Green Giants – Episode 90

Wes Ashworth (02:24)

Absolutely. I see that kind of moment of convergence really come through as you describe it. I think energy tends to pull people in because it forces you to engage with real constraints and real trade-offs all at once. You’ve said renewable energy was the first time you felt a true professional what specifically clicked for you in that moment and kind of helped you to come to that conclusion?

Ben Gerber (02:46)

Well, I think it was really the challenge and the, newness, but when I working on, C&I rates and regulatory policy, working on behalf of the business community with, the environmental community was really inspiring and working on, permitting reform and ensuring that projects could be built in the state of Minnesota where I’m located now, but was also located then at the time. What I think was what really, got me inspired to realize that there’s a lot of opportunity and there was that, that the rules were evolving from large centralized, production facilities to not only just distributed generation, but smaller facilities, that could provide a lot of different benefits to the grid.

Wes Ashworth (03:29)

I think that sense of alignment matters. I think it draws a lot of people in and the reason kind of they stay through the ups and downs, the highs and lows. It’s a complex challenge. There’s a lot to do, but it’s cool to be a part of it. It’s cool to be a part of the solution and seeing it happen all that. You started your career in oil and gas during a difficult economic period. How did that time shape your perspective on energy markets and the transition ahead?

Ben Gerber (03:53)

I think it helped a lot. I think always keeping an open mind is important. I knew I wanted to work in energy. There weren’t opportunities in the 2010 time frame to work on renewables. It was still part of that coming out of the downturn. But a lot of the same issues that oil and gas development face, the renewable energy industry faces. In fact, a lot of those problems are pretty intertwined in the regulatory structure as well.

A lot of the rules around permitting oil pipelines, which I’ve worked on, are the same as permitting clean energy transmission and clean energy facilities. It’s the same type of opposition that you see from communities. We don’t want industrial development here. We don’t want to see wind turbines. We don’t want to see oil pipelines.

It actually is really instructive. That’s why you see a lot of lawyers working on both electricity transmission systems and oil pipeline permitting. People are always surprised. The problems are the same. A lot of it really just has to do. We see this now today with renewable energy purchases, is being able to tell the story and getting community involvement. First, before the repose to it, it’s really critical to any project succeeding, whether it’s oil and gas or renewable or clean.

Wes Ashworth (05:05)

I think there are a lot of parallels, a lot that we can learn certainly from that. you said, there are tons of similarities. Some people just think they’re completely just counter against each other. I don’t know. There are things that we can definitely pick up and learn from that experience because, one, it’s a more mature market’s been around longer, but a lot of these same issues exist. That’s a cool perspective.

A lot of professionals I’ve talked to have come from that world and now are in the renewable energy side. But for that reason, I think there’s a lot that sets you up for success. Then when you moved into representing large commercial and industrial rate payers, what did you learn about how major consumers think about energy and risk?

Ben Gerber (05:43)

It was always really interesting to me because I also represented some of the small C&I customers and it was interesting to me to ask people if they ever looked at their bill. Now there’s a really interesting movement that’s just come out recently about making utility bills easy to read. I forgot they came up with a snazzy title.

They’re really complex and hard to understand. Even someone that’s in energy, I have solar at my house and an EV and I’m trying to figure all this stuff out. I geek out on it and it’s difficult. But working with the C&I customers and understanding what their needs were was always really interesting. Including, it got very wonky, working with a company in Northern Minnesota that was creating issues on the grid when they ran one of their metal recyclers. As they were crushing metal, they created problems for some of the other sensitive customers in that area of the grid where you had large mines and paper mills and some other complex that couldn’t have those harmonics and issues on the grid.

Being able to understand those and then working with a utility to figure out, instead of having them spend $200,000 on upgrading infrastructure in that area is their used equipment they could get from the utility. We ended up finding out that they could. It was a really good way to understand some of these problems that we’re now seeing, or will see, when whether you have too much or not enough generation in certain areas and how you deal with that and how you work with utilities and regulators to come up with solutions. I mean, I’ve always tried to look at these problems and come up with the easiest solution, but also innovative ways. Sometimes it’s not that you need to go to the difficult route, but finding out what the common ground is.

Wes Ashworth (07:25)

Good stuff there. Good perspective and finding that common ground. I think that buyer perspective will really set up lot of what we’ll get into here in a little bit to kind of stay on just this early journey and kind of building the foundation of this. CleanCounts has evolved dramatically since you joined in 2015. What was the problem you originally stepped in to solve and how has that expanded over the last decade?

Ben Gerber (07:47)

Well, I was originally hired when the Clean Power Plan was coming into being. Those of you that listening that were in the market at that time might remember that trauma, we all suffered it together. But the idea was, all right, we have these robust tracking systems. What happens when we start tracking something at a different level?

In my experience, in my oil and gas work was in North Dakota, realizing having worked with some states that might not be always favorable to the federal government coming in and intervening, but they also weren’t gonna pay for something that they didn’t really wanna do. Realizing that these systems, the rec generation systems that weren’t part of the government may potentially go away, but is there a role for them still to play? If there’s not, we’re a nonprofit, we don’t need to exist. We realized that, yes, there is. In Europe where they had carbon regulation already and still do, the type of renewable energy certificate markets are still really robust and mature markets. There was going to be a need for it.

But what was that need going to look like? That’s right around the time where we saw a change in the federal government, the clean power plan go away and the whole idea of the PPA revolution, for lack of a better term, and the ability for customers to actually demand or make demands at the grid and actually get them.

I think having worked with those customers before, it’s really interesting because understanding that they already had very good relationships, in some cases with utilities, or wanted to have good relationships. They went to the utilities and said, we want this and you need to find a way to give that to us. There was a lot of tension at first, but then we started seeing those first deals, their smaller deals pop up and more and more. Now there’s a whole sophisticated industry around power purchase agreements.

VPPAs, PPA, and all of these really complex. Now we’re seeing that those customers are driving policy changes at the federal and state levels.

Wes Ashworth (09:35)

Quite the evolution. How does that translate? What’s the main problem you’re trying to solve today? If you look at kind of where you came from and some of the things that it was focused on and how that evolved, what’s the main focus today and what CleanCounts is out there to solve and do?

Ben Gerber (09:50)

Most people have never really seen, will never see a clean energy registry. It’s funny, I was Googling on Reddit and there’s one Reddit string and there’s Reddit strings for everything, but not a clean energy registry. That’s okay. I’m not expecting it, but nearly every clean energy deal will rely on them. Most importantly, if you can’t measure it, you can’t fix it and improve it.

Data is really the foundational measurement to improve the grid and really to understand how to decarbonize the grid. You have to be able to measure it and understand where you are now and where you want to go. Without registries and data, we are acting blindly. To some extent we are now because even if we have parts of that, so the registries have this information, but there’s very little coordination and standardization around this data.

Not only between the registries, which is an issue that my own industry owns, but in providing useful information to regulators and others, it’s still a frustrating endeavor. One of the things we want to do is fix that. We see that we played an important role in that, we have an obligation to improve transparency and access to this data so that we can achieve those goals of the grid, whatever they are.

Wes Ashworth (10:59)

Awesome. I agree completely. I think it’s one of those, probably lesser known people don’t think about it. It’s sort of behind the scenes, you doing the really important work and it’s reason why I’m glad we’re having this conversation, getting some of this out there as well too. Tell us a bit about, CleanCounts transitioning from just compliance centered registry to voluntary market powerhouse. What does that actually mean? What should people understand about it? Is there an inflection point that stands out as a moment? Everything just began to accelerate and led you to obviously today.

Ben Gerber (11:29)

I think that real transition, so when I joined in 2015 in October, less than 25 % of the volume in our system, was under 100, it was like 75 million RECs issued, 75 million megawatt hours, and it’s now over 300 million issued in a year.

Less than 25 % was voluntary and now I look out today and last year it was over 75%. We’ve seen a total flip and what the compliance markets were what really drove the early voluntary markets. There was regulatory surplus, the generator owners and utilities, what do we do with these? Well, there’s customers that want them. We can start with green tariffs and green pricing programs that started to proliferate, but even before power purchase agreements. Then others realized, well, I want to actually direct access. I want to see the pricing strategies. I think that is really where the turning point was. In terms of years, it was really in the 2020 timeline.

We saw the massive growth where it wasn’t just the big tech companies. It was a lot of companies wanting to build or own generation and seeing 18 plus percent growth, not just in our revenue, in the generators registering and the production we’re seeing and the different types.

I mean, it’s still the case now that it’s a small minority of our overall generators produce the majority of the certificates, but it’s no longer the case that that’s going to be true in every registry. You have some registries that have hundreds of thousands of generators, but have half the volume of issued certificates that our system. Especially on the coasts or areas where you don’t have like in the Midwest, we track all over North America.

But our historical footprint and where the bulk of our generators are in the SPP and MISO territory. That’s where you see a ton of large generators that are then the electrons are bought by companies all over.

Wes Ashworth (13:31)

Absolutely. Now we’ve kind of set the stage of a little bit your journey, CleanCounts, what you’re doing and how that’s evolved. I want to talk about getting into one of the least visible, but most essential parts of the system, which is how clean energy is actually counted and claimed. We’ve been talking about this, but growing criticism of EACs, from both ends of the political spectrum, What do people misunderstand about what EACs actually do? I would think most people are somewhat familiar, but maybe just a quick explainer on what they actually are, what it’s actually doing, and why it’s important, and then what people misunderstand about them.

Ben Gerber (14:06)

I kind had a moment of clarity a few months ago when the Trump administration put out a letter criticizing EACs and I think it was a DOJ asked for information from some of these large tech companies saying, you’re not providing accurate accounting because you don’t have what we call a 24 seven match or your production consumption is a match, which by the way, the federal government has never required, but some customers want.

Then on the other side saying that these are just greenwashing tools. Coming from my policy background, having been a lobbyist and regulatory attorney, that’s the place you want to be. If you’re being attacked by both flanks, like that’s actually means you’re probably doing something right. I’m kind of joking but I’m a little bit serious, which is that, I think that’s a good thing. However, a lot of those attacks are misguided.

You know, for one, think attacking, first of all, greenwashing, I feel like is kind of just one of those things that if you don’t like something, you just call it greenwashing. If it has to do with environment, and it’s kind of hard to rebut that. But a lot of the criticism addressed to EACs are that, especially specifically RECs is that, well, they’re not decarbonization instruments. My response was, well, they weren’t originally supposed to be. It was an accounting tool for RPS policies.

But if you want them to be decarbonization instruments, let’s talk about that so you can scrap it totally and create a new instrument and scrap all the hours and time and money that went into that and the markets, or you talk about adding more and more data to the certificates. That’s what we’re looking at doing. There are questions and concerns over what type of data, whether it’s hourly certificates or this 24 seven idea, which the greenhouse gas protocol is considering requiring.

Then there’s also the idea of emissionality or emissions data, locational marginal emissions and other emissions data stamped on certificates. We can do all of those and let the market decide what they prefer. Then I think the criticism that recently came from this administration was, well, you’re not being accurate. Okay, well, we need the data.

Part of it is can we get the data? The answer is yes. It’s not really a data issue. It’s a systems issue, and it’s an implementation issue. If you want customers to have to match their production and consumption, they can do that. It adds complexity. It doesn’t necessarily mean it makes it more expensive or it’s impossible, but it is more complex. But it’s a doable thing.

I think what we saw as a problem is, and you mentioned this, our origins in the compliance market, most of the registries still view themselves and sort of be critical of our own industry is, well, we listen to regulators and whatever they want us to do, we do it. Well, we do that too, but that doesn’t absolve you of facilitating the rest of the market. Even if it’s only 10 % for another register, even less than that, that was an important piece of your market. We believe that we also have to listen to the voluntary customers and obviously if those things ever come in conflict, which we haven’t seen it yet, but it could happen, then I think we would defer to the regulators because there’s legal requirements around them. You can facilitate multiple different, especially with modern technology, can facilitate multiple different options or optionality into the system, whether it’s emissionality or other thing, or 24-7 and provide for the customers.

Wes Ashworth (17:13)

I appreciate you speaking to that criticism. I think clearing that up is one of the things that I always love to do on the show is just, tell truth around misconceptions. I think people sometimes just chalk things up as like, yeah, that’s just what it is. I heard it. I saw it, you know, but it’s really good to speak to those and some of the context behind it, which I think is really important. Another thing is when groups argue that we should ignore EACs and rely on grid mix, what would the consequences be for the supply chain installers, equipment markets and developers?

Ben Gerber (17:40)

I mean, it would be catastrophic because I think when you look at the NREL data, the state of the market report that they put out, and so this is government data that hasn’t really changed across administrations either, that the bulk of the renewables put on the grid last year, I think it was over 70%, which is a number I keep saying, but it kind of keeps coming up. But you can safely say over two thirds of the generation that went online last year is for voluntary customers of new renewables.

You wouldn’t have that. I think there’s a lot of folks that would say, that in an academic census where you tend to hear this is that, well we should just rely on a residual mix and which is like remove all the voluntary. Then there’s the grid mix. That’s what the standard delivery mix is and then try to reduce that. But if you can’t, if you, if you can’t count those voluntary commitments, you lose the bulk of new generation coming online and you would do way more damage to this industry than any legislation could. I stand behind that. I mean, way more damage financially, from a jobs perspective, from anything. We may harm ourselves more this industry than the government ever could. I think that’s what’s scary.

I understand a lot of the folks that want that come from the position that the government should make these decisions and should decarbonize the grid. I think, again, in theory, that might work out. But if you look at what’s happening, if you follow what’s happening at Davos or anything like that, which is annoying to have follow that stuff, but it’s important because it’s where decisions are made, people are walking away from that. At least publicly. I mean, privately, the consensus is, we still care about climate. We’re just not going to talk about it. But if you’re going to rely on governments to do it, I think that’s a much more scarier prospect than those corporates who are putting their own dollars into this. They have to answer to shareholders

Wes Ashworth (19:32)

Absolutely. Those ripple effects really tend to get overlooked when the debate stays theoretical. I agree. That’s why we need to really think about it and how it’s going to have a real world impact. I think for me, just really underscores how these accounting debates translate into real world outcomes, the importance of what you’re doing. How do you maybe explain to skeptics that electrons on a grid cannot be traced physically and that an accounting system is essential rather than optional?

Ben Gerber (19:57)

I think this is not like cable. I actually use this analogy for someone’s in the cable industry. This is actually how it happens. Like you call up your cable company, like on HBO and then someone flips a switch and HBO is at your house, right? Well, that’s not how electrons work. With electrons, they flow under the laws of physics. You can, you can go through, jump through hoops and try to guess in theory based on congestion and other things.

It’s more likely that these electrons flowed this way. But it’s impossible to actually say, yes, this electron went there. What we’re left with is the need, which is why EACs exist, to decouple the physical commodity or the electron from the environmental attributes. We decoupled those at the point they’re put onto the grid.

For our gas products, it’s when it’s put into a common carrier pipeline or a pipeline, you’re decoupling that. Then you can create boundaries. This is what the GHG protocol is doing and saying, well, you need to be in the same bidding zone or you need to be in the same interconnect. You can do it that way, but you can’t ever say, yes, this electron was consumed by this customer unless you’re off grid.

As we’re seeing now the discussion with a lot of these large users, this one was really, truly off grid at this point. I mean, it might happen, but you still want that extra insurance policy of being on the grid. Outside of that, even a lot of utility programs, like I have to tell people I’ve solar in my house, I’m enrolled in Xcel’s solar rewards program, which means I sold the right to all my environmental attributes. In Minnesota, it’s a buy all, sell all. Those electrons in theory are going back to the utility and it’s, it’s likely if I’m consuming at my house, it’s going to get pulled back.

But again, we don’t do it that way and those electrons go there. If I’m enrolled in a green tariff, then yes, I can say I’m consuming clean electricity at my house, but just by the fact of having it at my house doesn’t mean I am. I try to explain that to people at dinner parties. They get really bored and their eyes glaze over and I have to be reminded that not everyone cares about this stuff.

Wes Ashworth (21:48)

We care we care. I think once people understand the physics at least you know the need for an accounting layer becomes much more clear and you understand why we need this. I think overall once we understand a little bit of why EACs exist what problem they were designed to solve the next question naturally follows which you started to touch on a little bit but as goals shift from simply procuring clean energy to actually measuring emission reductions people began asking more of the system and that’s where greenhouse gas accounting and new approaches start to matter. EACs were designed for procurement accounting, not necessarily decarbonization measurement. You touched on that briefly in the beginning. What does that evolved EAC look like in your mind? If that changed and evolved the way you think it should, what would it look like?

Ben Gerber (22:36)

The thrust of all this is, what does the customer want? It’s not even always clear what the customer wants, this is an evolving issue in itself. But I think one of the things I’ve learned is that running what I never thought would become a tech company. When we built our own system in 2017 and launched it, I’m an energy regulatory lawyer. I told my board, I have no business doing this. You guys probably hire someone else. They’re like, no, we believe in you. I think it was the greatest decision that I didn’t make, is someone saying, no, we think you should do this, because I’ve a lot and am much better for it.

But one of the things that we’ve learned is that a lot of people don’t understand technology, especially in the energy world. so sometimes it’s more about iterations and trying things out.

I hate the word pilot, because I think that can get misused. A lot of times pilots become actual official products and if you build it off of a platform that isn’t stable and supposed to be permanent you can get yourself into trouble and it’s really like related to the tech piece of it. But it happens in other parts of the world. I think that trying things out and whether it’s mock-ups are like what we did with Google in 2020. Right before everything I was at NARUC and I was pleading with them like hey we have this data in our system already and you guys publish this paper let’s like try to make this work. Finally we got the right attention and they realized, okay.

They did this first ever transaction in our system. It was just to show the world, okay, this is not a technical problem. The small little dinky nonprofit that’s not even a $2 million a year in revenue and had five employees at the time can, can provide for this. Now let’s get into like, what are the rules around it? How do we actually build a product out of this? That’s where Energy Tag came I and created global rules and standards, standard processes, which we were deeply involved in.

The same thing with the emissionality is like, we don’t believe in this 24 seven thing. We think the emissions, the marginal emissions values where you should invest your resources and trying to reduce the marginal emission, the dirtiest places in the grid by your activity. It’s integrating that data. You go through a few things, which is how do I validate the data and make sure that I’m giving people real information.

I will say this and stand by it, the data in the energy ecosystem is still awful. I think that’s a nice way to put it. You know, for the fact that you have civilized audiences, I probably could use a worse word or words to describe it. There’s a real lack of standards and appreciation for data. We’re starting to see that change, but it’s still slow going.

That’s a little bit frustrating. A lot of the systems we’re dealing with are like old systems that need to be updated, but it’s hard to update a system because if it’s launched and it’s broken, the grid goes down. You also have that, like I don’t have, like I have some sympathy for them because if our system goes down, the grid doesn’t fail and people lose their jobs and like it’s serious. All of that is to try to figure out how do we create a product that is validated data that we know is real.

That can be a problem too, because things like locational marginal emissions, you’re guessing at a data point, what is the marginal unit in that part of the grid at that time? But for your incremental renewable, or, it would have, you would have dispatched more coal. How can everyone claim that they were the one that displaced that marginal unit and chase it around the grid? If you’re looking at hourly there’s a lot of complexity around managing that and, how do you ensure that, that you’re able to operationalize effectively, not just cost effectively, but, efficiently produce whatever your product is?

I have to criticize them both because if I don’t, then I get criticized. I get criticized like you’re too pro-hourly to your two pro- emissionality. No, we want to be solutions provider for everyone. We also have to make sure that what we’re giving the industry we can stand behind.

Wes Ashworth (26:27)

It’s complex, right? I think it’s evolving. I think that’s the key thing. I think some people expect perfect right away is never going to happen. These things take time, takes going through iterations and I just had sort of a little bit of trying things out, some trial and error and you end up getting it right, but it never starts perfect. I guess that’s always the reminder. You started to touch on a couple of real world examples, like Google’s 24 seven CFE model, Meta’s emissionality modeling for different outcomes. With those comparing, what does each get right and what are their blind spots?

Ben Gerber (27:00)

What I can say, and this is not trying to give you a politician’s answer or a lobbyist answer, is that they both get one thing right, which is that they want to decarbonize the grid and they want to do it as efficiently and cost-effectively as possible. I think that’s what’s frustrating to me is that there’s a lot of fighting between, in some cases, the proponents of these ideas individually, collectively, and then the service providers and everything.

But in the end, when you talk to these companies, whether it’s Level 10 or Assurity or Google or Meta, they all have the same end goal in mind, which is to, as I said before, cost efficiently decarbonize the grid. I think that’s what I try to focus on.

I think it’s easy to poke holes in each of the models, especially if you consider yourself on one side or the other. But in the end, we want to do is provide a pathway to do we spend a lot of time now fighting over this and the GHG protocol now saying, well, like, we’re going to require hourly. Now you have all this fighting and it’s like, hey, we’re all trying to reduce emissions on the grid, let’s focus on that instead of like staking. It’s hard. It’s hard to do it. I’ll be totally honest with you in my evolution of this, because I think you need to keep an open mind. As I mentioned, my career has kind of been like that too.

I came into this thinking that emissionality was the most important thing behind hourly is that we should look at what hours are the most carbon intensive on the grid go look at investing in those areas. Boston University is a good example of a company that did that even before it was called emissionality. They took a lot of flak, even internally, from within the university system. They bought the output of a wind farm in a coal-heavy region of South Dakota. They actually used our system to buy those certificates. That was important.

I think they should be applauded for that one, for doing something innovative when it wasn’t the popular thing to do and they had to push on it. Google doing 24-7, I think is another example of that. But I think my eyes were opened about like, all right, well, you asked me to be a little bit critical. I think I owe you that a little bit of that answer of, well, you’re almost as like squeezing the balloon. Where are you just pushing emissions up other places and chasing this around?

If you’re investing in 20-year assets, but your value is based off of an hourly LME is that asset going to be valuable for you from a carbon accounting perspective, for those 20 years? Because if everyone runs to the same place, I think there’s a fair criticism there, like there’s a fair criticism of hourly in many ways, that it’s going to increase compliance costs for some customers and I think the criticism I often hear is like, all right, a 96 % or 99 % load factor data center, matching that on hourly level, is much easier than having 1800 stores across the country. Utilities that you might have to go to get their tariff, have to go between nine and five to the county clerk’s office to check it out, which is a real thing that happens.

That’s a real criticism of like from an operational standpoint, how do I do that? I’m trying to be fair here to show like there’s, there’s no silver bullet for decarbonization. Which is always frustrating to me. We’ve been working a lot on, CCS and carbon capture and sequestration, creating a certificate model for that. We work with Northbridge, on the report. We were the only registry that got active in that. You have a lot of people that are like, well, CCS is terrible.

It’s like, well, if we can create electrons without emissions, is that the goal or is the goal your preferred way? Because science will say that emitting carbon is a problem the more carbon we emit, bigger the problem. It doesn’t say that we should only use nuclear or not use nuclear or not use CCS. It’s carbon abatement. I think being focused on that is how I try to stay grounded.

Wes Ashworth (30:45)

I think it’s good. I think a couple of threads you shared there, which I’ll touch on just one, I think keeping the end goal in mind of what we’re all trying to accomplish. Sometimes you do get distracted from that when you’re set on like this particular way. Then also keeping an open mind, that it’s not perfect, that is evolving, it’s changing as well. Keeping that open mind, I think is important as we go forward in general.

Thinking about this, so for those listening, maybe project developers or corporate buyers that are trying to choose between these models, what guiding questions should they be asking themselves? What wisdom could you share for them?

Ben Gerber (31:19)

I think really the question that you have to ask is to cost effectively decarbonize the grid is what is going to work for your company. As I mentioned for having two stores or 1800 if you have them in different regions where I woke up yesterday and it was negative 20, you’re in a very different energy profile than if that second store that you had is in Southern Florida and the temperature was 60 degrees when folks were waking up.

Understanding what works for you as long as your goal is how do we reduce our emissions impact on the grid. Whether that’s a utility green tariff, whether that’s a PPA, it’s going to really be up to the individuals. I think what’s really important both from a regulatory standpoint, is the options are given. I think what’s frustrating is that a lot of parts of the grid, know, buyers, whether it’s a residential customer or a C&I customer, isn’t given those options. That’s where people lose their patience.

I think we’re starting to see this, but utility companies are going to need to continue to evolve and they will become technology companies like everything. If they don’t, they will cease being the utility. But understanding that this whole idea of a platform economy, people are used to getting what they want and they don’t really tolerate that. We can make all the policy arguments in the world where they don’t understand reliability or they don’t understand the utility compact. Those all go out the door when they start, you know, really aggressively pursuing what they want.

I think that it’s going to be, difficult because you are going to have those folks that all they care about is that their lights are on and that, that the bill is affordable. There are going to be some that want, you know, like the VIP package where they can pick and choose what they want. They’re willing to trade off some of those things.

Wes Ashworth (33:10)

I think just practical reminders to help bring clarity to a complex decision. But good questions, to ask yourself and how to frame that up and how to think about it. I think it makes a ton of sense and it’s very practical which I love. CleanCounts also is working on providing granular data so markets can decide which model they want to support. Just digging further into this, what does it take to build a registry flexible enough for that level of complexity?

Ben Gerber (33:35)

That’s been what we’ve seen is the fun and the hard part. When I started, there was four of us and we had an outsourced software company. When we built and launched our own system, there was really three of us and then we had three contract software developers. We now have 30 employees, including about 10 of our own software developers, and then plus 25 other contract software developers. We’ve grown quite a bit and to build something flexible and future-proof requires a lot of resources. A lot of that growth, I mean, we’re lucky that we were in an industry that was growing 20% a year and that we’ve always been historically very tight with our budget.

But we’re expecting, when I joined, I mentioned we were a little bit over a million dollars a year in revenue. We’re now this year 13, but almost all of that goes back into software. Our salaries are public. I’m not driving a Ferrari. I run a nonprofit and I’m proud of what we run. I joke about that, but this is a job that I love in that we’ve been able to be innovative and help change these markets. That to me means more.

Could we become a for-profit? Yes, but I think that harms our credibility. We’re able, I think the nonprofit piece, and I harp on this a lot with regulators, is the revenue goes back into the system. It goes back into improvements. If we had to pay dividends to shareholders, this wouldn’t work.

That’s where a lot of the systems become outdated and inefficient and ineffective, is that there’s not a lot there. It takes a lot of reinvesting back into the system and continuously building. Technology, if you slip up even just for a year, it can bite you and you have to constantly maintain. I think of it as a living creature and that you’re constantly feeding it and it to be updated. It’s cage cleaned out and changed and updated. If you don’t, then it’s not a good situation.

Wes Ashworth (35:32)

It’s clear, obviously, the amount that has to go into it, obviously the reinvestment and I appreciate your work in it and the heart and passion to do it. It needs to be done. Obviously we talked about it. It’s messy and complex and not perfect. This is just continuing to get better. But obviously the amount of work you’re pouring into it and doing it from the right heart and mind of doing it the right way and maintain credibility and trust. I think that’s so, so important.

For me, what kept coming up through all of that and thinking about it is just none of these approaches work without that solid data underneath them. I think that’s becoming true of all of our society. We’re trying to get just more accurate data underneath everything going on. But you can have those right goals and frameworks, but the information feeding the systems, it’s incomplete or fragmented. Everything else on top of it becomes fragile in turn. It brings us kind of the critical role of data infrastructure.

You’ve mentioned, obviously, it’s a little outdated, a little messy, and some utilities sometimes rely on scanned PDFs and outdated systems. What’s that hidden cost of just poor energy data infrastructure?

Ben Gerber (36:34)

I think it’s significant and I don’t even know if I could put a number on and it goes across, and I come from coming from the legal world, I had this debate with our lawyer when we launched our system as cloud infrastructure and our lawyer said like, no, that’s terrible, it’s not safe. You gotta have your own server rack at a data center somewhere. I sat down and explained, like, do you know how much like AWS or Google Cloud spends on their security.

They spend more every minute than we could spend in five years. These things are changing so rapidly that I think that’s what’s important. That’s where I think it’s important that we think of ourselves as a technology company and not just a clean energy nonprofit. We are and we do a lot of education around that, but it’s really important by building a modern scalable registry platform, we designed around our customers and not bureaucracy. I think that’s where a lot of these systems that people interact with– whether, by the way, there are some really great government systems. EIA is probably one of the best, we usually use it internally often as a reference point. We were doing some planning and it was like, I want our system to show charts like this. Not all government system, but a lot of times when people interact with like bureaucratic systems, it’s a terrible infrastructure and it’s glitchy.

It’s trying to figure out how we can build it around the customer and not like the bureaucratic nature of the systems. Where a lot of folks go wrong, and this is across systems, you see it really bad in the register energy world, is that it’s all stakeholder driven. I had a great mentor early on in my career that said stakeholder groups are a poor excuse for leadership. By the way, stakeholder groups have their place, but sometimes you’ve just got to do something and then get feedback. Because if you sit around and talk about it, it doesn’t always come together.

What that driving change and bringing that technology and designing around the customer allows you to get rapid feature development. It allows you to lower costs in the end, but most importantly, it’s the ability to anticipate and not react to market change. We can sit there and think about it.

If we’re solely responding to what has been discussed ad nauseam in these groups, then you’re going to be way behind the curve. Sometimes that’s good, but it’s usually not, and it’s usually bad. How do we really focus on these changes? I think it’s tough because if people don’t log in and look at their utility bills and they don’t ever log into these systems, they don’t know.

You know, I think it was really indicative, like I have solar on my house. It was a year before we had a smart meter installed and I knew more about what was happening at my house and my energy system than the utility did and that was crazy to me. I think you know not everyone’s going to care about that and so it’s again they just want the lights to flip on. But I think we’re starting to see, as well as good design I think a lot of people look at it as a luxury.

But good design usually means you’re listening to the customers and we spent a lot of time not just designing what we’re then gonna show, but then going back and fixing and seeing how customers use our system. It’s important to do that because again, that’s gonna give you that ability to anticipate those upcoming market changes and not just be reactionary.

Wes Ashworth (39:45)

Absolutely. Thinking about some of the progression. There are some emerging platforms like MISO’s collaboration with Singularity Energy that show what’s possible. Can you tell us a little bit about that and maybe what needs to happen to scale that kind of innovation across different markets?

Ben Gerber (40:00)

We’re really excited about that one. We’ve worked very closely with Wenbo and their CEO and continue to be excited for them about their success in working with RTOs and more and more utilities on data. But I think one of the things that we’re seeing is the need to reform. This is where I’m going to go back to my utility regulatory hat that I can never escape, which is that for a long time and still in a lot of states, utilities can only rate base their own infrastructure, not cloud infrastructure or some of the third-party services. They had no incentive to work with third parties that are developing these things. These tools that are helping them work.

I think about companies like Spark Fund is another one, Singularity, Resurity, Level 10. They’re all working on these tools that will help utilities build efficiencies into their own processes, but if there’s no incentive for the utilities to do that, and so I think then they’re not going to, or they’re gonna make it very difficult. Getting the right incentives in place in the utility regulatory structure is important, and that’s where things like NARUC and other groups are hopefully listening.

But it’s hard because having been a lobbyist in the regulatory world and now working in tech and having this overlap, I understand why people, especially like how you have one of the biggest like, you know, changes that we’ve seen in the utility world in generations with like large loads and all of this and fire risks. How are you going to now pay attention to how technology is integrated and understanding technology? I understand why this isn’t happening, but we have to figure out a way to do it and do it efficiently so that these types of companies who are really innovative and understand this data can then make sure it’s useful because we can have all this data.

If we don’t know how to use it or we use it wrong, it can actually be problematic. We need to get the data, make sure that it’s accurate, and then figure out what is the best utilization for it and how can we advance society or our common goals through it. I do have faith not to sound corny, and then the next few years I think we’ll get there.

But you kind of have people trying to figure all of this out and it exists. That’s the frustrating part. It might exist in a PDF and some utilities, you know, PDF, filing system, but it’s there. It’s how we access it, how we standardize it and then how we utilize it.

Wes Ashworth (42:13)

I know you make the good point there. The importance of getting it right, again, having the right data and being able to pull out of it what we need to as well. I think you can see both sides of that. I think how great it could be if you get that right. But also the risks if you have the wrong data and don’t use that appropriately.

Ben Gerber (42:33)

I was talking to somebody who showed me this product, which it ended up, it was kind of cool, but it was really just taking like, I guess what they’re called as like ChatGPT wraps, where you like try to make a product out of ChatGPT and sell it as like this innovative product. This is not to demean this product, but one of the things that was like, well, I can, you asked me a question and I can like, this can take all of these regulatory data that’s public and give you like a better answer.

I was like, yeah, but a lot of the reasons why regulatory decisions are made aren’t ever put into the comments, or it’s not always clear, or there’s differing reasons. We also have to be careful about, like the anthropic example, not to hammer on it, which is that if we’re going to train these really important tools, and we’re training it on things that aren’t really indicative of where we want humanity to go or where it is or has been, that’s a problem. I think we’ll figure it out.

Wes Ashworth (43:26)

I think everything like we’ve talked about today and what’s interesting is like the same questions you’ve been wrestling with on the electricity side are now showing up in new places and as clean electrons begin moving into clean molecules, the need for credible tracking doesn’t disappear becomes more complex. You’re doing some stuff with clean ammonia and hydrogen and other things. Tell us a bit about that, what’s evolving and what’s coming and what you’re working on with those molecules as well.

Ben Gerber (43:49)

I think we think about this internally that the clean energy transition isn’t just about building more tools or newer tools but counting what we have better and counting what we’re going to do better. That’s where that name really comes from. What we’re looking at in the future is a deeper integration with the corporate climate accounting world and whether it’s 24-7 or emissionality or other things that may come up and helping users achieve their goals with validated data that they can trust.

We are looking at expansions into new commodities. We really talk a lot internally about the electron and molecule pathway and sometimes back to electron or to more complex molecule. This idea of converting EACs, so taking electrons, creating hydrogen, then creating ammonia that can then be sent to Europe and cracked and taken as hydrogen. All those we know are the future and we’re working with customers that are actually already shipping clean fuels from the U.S. to places like Japan.

Understanding how these markets interact and engage is really critical. What a lot of companies, especially the for-profit model registries are like, we’ll just build all these different registries. We’ll build an ammonia registry. We’ll build a shipping registry. For us, it’s just have a clean fuels registry. You can pick it. What is the best tool for you? If you have to have 18 different registries and then you need a new interface just to like manage all your inventory and all the registries, that doesn’t do anyone any good. I think what we’re trying to do is simplify all these processes and we can do that, I think, with our nonprofit model and still make it work.

Then looking to continue to scale these markets without sacrificing trust. It’s difficult. We’re seeing this now that our thermal system and biomethane, where we already track green hydrogen certificates, that looking at how definitions evolve and how people sell these commodities and making sure that they’re doing so in a way that meets existing ethical and regulatory requirements. This is where we see all of these things coming together and the energy and fuel markets continue to be more intertwined. I think that’s a good thing because I think if they’re all both focused on decarbonization, it’s going to only benefit us in the future.

Wes Ashworth (45:53)

Absolutely. As we get closer to time, I’ll ask a couple more questions, just more future looking sort of stuff. Just thinking about where you are today, everything we’ve kind of considered talked about and what your company is doing. What are the things, that give you the most confidence right now? What are you hopeful about?

Ben Gerber (46:09)

That we still continue to see, you know, a lot of people ask me whenever there’s an election, what’s going to happen?

I would say that I don’t think it’s really politics that’s even dictating this anymore. It’s corporate customers and as well as residential customers and everyone have already made that move. we survey people globally, regardless of their political affiliation, especially outside the US where this is not as much of a political issue, that people see this coming.

I mean, I’ve kind of said to people like the government can’t stop this transition. They couldn’t legislate it. Even if they tried, because it’s what’s naturally happening. I think that’s what allows me to remain optimistic about it and realize this is not a political battle. It’s really, it’s a transformational shift in the way that we produce and consume electrons and as well as molecules. We’re going to continue to see greater and greater levels of decarbonization. Are we going to have blips where it might go up? Yes. I mean, I think in the next few years with the data center issue and winning the AI race. There’s going to be reasons where we may, as a society, realize it’s okay to increase emissions for a little bit. I’m not saying that we should, but I think as a society, there may be decision, but I think overall the trend is going to continue globally.

I think that’s what, and again, it doesn’t matter who’s in political power anyways, it’s kind of unstoppable and that’s what is exciting about it. But I also realize that’s scary for a lot of people, because change is scary and people don’t like change.

Wes Ashworth (47:35)

I think that’s what gives me hope is society continues to evolve. You’re never going to stop progression, especially technological progression. When you look at electricity and the Internet and A.I. and now new sources of power and doing that in a smarter, better way. I think those that are truly informed in the know can see that clearly, regardless of whatever noise is around and outside. That too gives me a lot of hope.

Final questions. When you imagine the clean energy system 10 years from now, what do you hope CleanCounts will have made possible that maybe would have not happened otherwise?

Ben Gerber (48:08)

Much better data integration so that you’ll be able to see the renewable generation you’re consuming on something like a Nest thermostat, or you’ll be able to like actually have that transparency if you want it. Not everyone’s going to care, but to actually see that’s what my activity was related to these generators. Again, those not those necessarily those electrons, but this is what’s covering my activity and being able to see that so it’s not just theoretical, it’s actually something you can touch and see.

Wes Ashworth (48:39)

I like that. Be able to touch it and see a powerful way to frame long term importance of this work and what you’re doing.

With that, Ben, thank you for walking us through the systems that make clean energy markets function. CleanCounts is doing the kind of foundational work that often goes unnoticed, but without it, progress would stall.

I really appreciate the clarity and thoughtfulness you brought to the conversation. To our listeners out there, thank you for spending time with us today. If you found this episode valuable, please subscribe, leave a rating, and share it with someone who cares about the future of energy.

With that, we’ll see you next time on Green Giants.