Terry McAuliffe’s Green America: an Exclusive Interview
By Natalia Brzezinski
Losing a political primary can be morale-breaking. But for Terry McAuliffe, it was inspiring.
“I literally woke up the next day rarin’ to go. I loved running, I loved talking to people and I’m doing what I said I’d do for the state, I’m just not doing it as governor,” McAuliffe told me laughing.
Although the question of whether he will run again in Virginia in 2013 remains tantalizingly unanswered, there’s little doubt McAuliffe will be a better potential governor now than two years ago.
The political maverick, famous for his prowess as a formidable negotiator, had a 135-page business plan for Virginia when he ran in 2009. But in the past two years he has brought his plan to life, doing what most successful candidates don’t do — fulfilling his campaign promises.
The former Democratic National Committee chairman and father of five has gone on a green crusade to bring renewable energy jobs and industrial dynamism to his home state. The Commonwealth of Virginia is today at a cross-roads between old and new, between colonial conventional and diverse cosmopolitan, and it shares in the suffering that all states now experience, lack of jobs.
“One-third of Americans have already been forced to change their lifestyle because their disposable income is gone. A guy can’t go to the corner bar after a rough day at work to have a beer, that’s gone to oil! We’re borrowing from China, slapping an interest rate on it and shipping it to the Middle East — that’s not a good position for the United States of America.”
According to the latest report from the Commonwealth Institute Fiscal Analysis based in Richmond, it may take ten years to reach pre-recession employment levels and in parts of Southwest Virginia unemployment is hovering near twenty percent. What worries McAuliffe most is that much of the state is propped up through generous Department of Defense spending, which is poised to be reduced soon under the Obama administration’s extensive defense budget cuts. McAuliffe believes Virginia can be both fiscally responsible and economically productive with a little creativity.
By starting an electric and hybrid car company called GreenTech Auto, investing in wind turbines, scouting out new technology throughout Asia to bring back home, and fighting to resuscitate a shuttered factory in Franklin, Virginia, McAuliffe is personally taking the strategic financial risks he believes the state needs to launch into the future.
In fact, with its diverse population (Fairfax County public schools boast 192 different nationalities), its geographic location abutting against the nation’s capital, with major research universities (both public and private), and world class international airports and sea ports, the state has no excuse in McAuliffe’s eyes than to be doing better than it is.
“Virginia is where Dorothy and I decided to raise a family twenty years ago. I love it. I love this tax base, I love this education system, and I love its great pro-business mentality and incredible natural resources. Moving here was the best decision we ever made. But now Virginia needs to shake things up and get into the global game.”
The fact that McAuliffe has mastered the Gordian nuances of global business is a major asset, according to several Virginians I spoke to while shadowing him. On the day of his youngest son’s First Communion, we spent four hours at two separate events for Northern Virginia Democrats, where McAuliffe served as a keynote speaker for both. Worrying that his wife would “kill him” if he was late, McAuliffe later zipped home in his hybrid Chevy to make the late afternoon service.
“I have big ideas. If you don’t like them, don’t vote for me. And you didn’t.”
McAuliffe joked about his 2009 effort as he introduced Del. Scott Surovell at a Mexican-themed barbecue, replete with a bright-colored Piñata and lively mariachi band. Although some voters remain puzzled by this high-energy force of nature, they’re also drawn to his enthusiasm and curious about his business ventures. Sitting in a circle around a fresh keg, blue Solo cup in hand, McAuliffe seemed like a tempered version of the braggadocio who once wrestled an alligator for a $15,000 political contribution.
Arriving at his GreenTech Auto Corporation corporate headquarters two days earlier, I was intimidated to meet the much-televised McAuliffe. But I found the man that greeted me to be open and keenly reflective on how he can contribute to a country that has allowed him to start 25 successful businesses from scratch. Below is a condensed version of our two-hour conversation.
Natalia Brzezinski: Why are you so passionate about renewable energy?
Terry McAuliffe: I’ve always been an entrepreneur, but it’s never been about the money. I like a challenge, the harder the better. But you know what, I’m in my early 50s and at a stage of my life where it’s not even about that anymore, it’s about what I can do to give back, to make the place a little bit better for the next generation.
Ultimately, it’s about the environment, job creation and national security. We import nearly 60 percent of our oil from overseas, much of it from countries that don’t like us. In addition to the $900 billion we spend on petroleum products per year, we spend $65-85 billion dollars a year to protect the channels where that oil is flowing. That money should be going to the American people.
How quickly do you think America is slipping behind in renewable energy?
China recently announced an $800 billion dollar investment in alternative energy — $800 billion! According to Pew, America used to be number one in investment in alternative energy, now China has taken the lead and Germany is second. Last year, private investment for green initiatives in China reached 54.4 billion dollars. Boy, I think some of that ought to come here to America.
Do you think business is much better poised than government to usher in a green revolution and create jobs?
No question. As a private entrepreneur I’m willing to take some big risks and I’m proud to say I’ve done what very few other businessmen have done. I’ve gone to China, bought a manufacturing company and moved it to America. Now China wants to buy back some of that new technology from me. That’s a great story for America.What’s the key to revving up job creation?
We’ve got to get into the jobs of the 21st century. I think alternative energy is one of the greatest ways to do it. Many of these jobs are skilled manufacturing jobs, the sector which has been hit hardest.
You don’t go to those people and tell them, ‘now we’re going to re-train you to work with computers’. They want to work with their hands. That’s what they love to do! We could save entire communities by bringing just one electric car manufacturing plant to a town.
I’m making definite progress in taking over part of the massive International Paper plant in Franklin, VA that decimated the community when it was shuttered. We’re going to make wood pellets and ship them to Europe where they will be mixed with coal. Europe currently imports ten million tons of wood pellets per year and now plans to increase that to 100 million tons. So this could be a new, lucrative industry for the region and create thousands of new jobs.
What else do we need to do as a nation to become competitive?
You need to incentivize. In parts of Europe you don’t pay any parking meters or any tolls if you have an electric car. In Denmark, they have 150 percent excise tax on new cars but electric are exempt. We also need a national energy standard to compete against other nations. And Virginia is the only state in the Mid-Atlantic without a renewable energy standard. I say all the time we’ve got to fix that.
High speed rail is also something I always talk about. You build the cars here, you build the rails and tracks here, and it’d be a huge job creator. China is now the leader in high speed rail but this is a market America should own!
Is Virginia ready to compete on the global level?
With the right leadership it would be. This is not a partisan thing, but we’re not offering any incentives compared to our neighbors.
I decided to locate our first GreenTech Auto manufacturing plant in Mississippi because their governor was very aggressive and state and county officials offered us an incentives package worth millions. I wanted to do it in Virginia, my home, and where our corporate headquarters is located, but I have a fiduciary responsibility to my shareholders to go where the company will be most successful. Virginia didn’t bid on it. But hopefully in the next 6-7 months we will be announcing our next plant which will hire thousands of people. I’m hopeful that Virginia will have an interest in it.
How do you respond to anxious workers in coal states who worry that renewable energy is going to take away their livelihoods?
I spent five hours in a coal mine a few months ago. I wanted to have a better understanding of their work. I would never look those people in the eye and take away their jobs. We’re always going to need coal energy. But we do need to re-work our grid and diversify to create more jobs and remain competitive.
If I asked your children about you, what would they tell me?
Hopefully they’d say they love me and I’m a lot of fun. They’d probably also say I drive ‘em crazy! I started my first business at 14-years-old. Now they’re in that age range and I’m constantly asking them ‘why aren’t you guys starting your own businesses?’ They run from me.
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SunShot to Reduce Solar Installation Cost
The U.S. Department of Energy SunShot Initiative, working in collaboration with the solar industry, will dramatically decrease the cost of electricity from solar energy. The goal is to achieve price parity between solar electricity and fossil-based electricity by the end of the decade, without additional subsidies. Reaching this goal will re-establish American technological leadership,
improve the nation’s energy security, and strengthen U.S. economic competitiveness in the global clean energy race.
The SunShot Initiative builds on the legacy of President Kennedy’s 1960s “moon shot” goal, which laid out a plan to regain the country’s lead in the space race and land a man on the moon. Similarly, the SunShot goal aims to restore America’s once-dominant position in the global market for solar photovoltaics (PV), which has dwindled from 43 percent in 1995 to only six percent today. To achieve the SunShot goal of reducing the total installed cost of solar electricity by about 75 percent, DOE will be working closely with partners in government, industry, research laboratories and academic institutions across the country. DOE estimates that if the installed costs for solar energy systems drop to $1 per watt — equivalent to a levelized cost of electricity of 5-6 cents per kilowatt hour — solar without subsidies would be competitive with the wholesale rate of electricity nearly everywhere in the U.S. These reductions in cost will lead to a dramatic increase in the market demand for solar energy technologies, enabling new domestic manufacturing.
The SunShot initiative will continue to accelerate and advance the Department’s existing research efforts by refocusing the Department’s solar energy programs — valued at approximately $200 million per year — to support a targeted roadmap to meet the SunShot goal by the end of the decade. The program will emphasize collaboration between DOE offices, including: the Office of Energy Efficiency and Renewable Energy, which focuses on deployment and applied research and development; the Office of Science, which advances early-stage scientific discoveries; and the Advanced Research Projects Agency-Energy (ARPA-E), which is investing in a range of transformative energy technologies and has related ongoing work on power electronics.
Historically, solar investments have focused on achieving incremental efficiency improvements to solar cells and arrays. SunShot takes a different approach. In addition to investing in improvements in cell technologies and manufacturing, the SunShot initiative will also focus on steps to reduce installation and permitting costs, which are significant contributors to the total installed system price of solar electricity. This includes efforts to streamline and digitize local permitting processes and to develop codes and standards that ensure high-performance over the approximately 20 year lifetime of residential solar products.
GE invests $6 Billion in renewable energy
GE Energy Financial Services announced today that it reached its multi-year target of building a $6 billion portfolio of renewable energy investments by the end of 2010, inspired by GE’s ecomagination initiative. Alex Urquhart, president and CEO of GE Energy Financial Services said “We achieved this $6 billion milestone because of our competitive advantage as a GE business focused on one of GE’s core domain strengths, renewable energy. To maintain this momentum, drive further deployment of renewable energy worldwide and keep America competitive through technology innovation and job creation, we are calling on Congress to enact long-term, predictable renewable energy policies.”
Cumulatively, the projects and companies have supported thousands of “green collar” jobs worldwide, helped grow the multi-billion dollar US renewable energy manufacturing industry, and—according to US Environmental Protection Agency methodology—avoided more than 23 million tons a year in global greenhouse gas emissions, equivalent to taking all the passenger vehicles off the road in the Washington, DC, metropolitan area. GE Energy Financial Services started investing in renewable energy in 1987. It had amassed a $3 billion portfolio by January 2008, when it set a target of reaching $6 billion by the end of this year. The investments have spanned 14 countries, 95 wind farms, 40 solar installations, six hydroelectric projects, 12 landfill gas facilities, and 15 projects involving other technologies, across a wide spectrum of capital – from project equity to debt, and venture capital.
Across the United States, GE Energy Financial Services has made approximately 75 percent of its renewable energy investments in states with renewable portfolio standards, or regulations requiring increased electricity generation from renewable sources. The GE unit’s research has shown that investments in the wind industry have risen and fallen with the renewal and expiration of renewable energy incentives. The expiration of incentives in 2000, 2002 and 2004 caused a 76-90 percent drop in installed capacity in the United States from the previous year.
An electric vehicle partner in Asia
This year China’s Ministry of Industry and Information Technology announced the New Energy Vehicle Promotion Plan, whereby the government will invest over 100 billion Yuan during the period 2011 – 2020 to promote energy conservation and develop the “new energy vehicle” industry supply chain. China is on a path to become the world’s largest car market. At the same time, the Chinese government is working actively to promote the development of the electric vehicle market in China through the use of policy tools. During the period of implementation of China’s 11th Five-year Plan, the Chinese government will be investing 7.5 billion Yuan in the development of vehicles powered by alternative energy sources, and a government subsidy of 60,000 Yuan will be provided for every electric vehicle sold.
According to Snow Tsao of the Department of Investment Services in Taipai,
Taiwanese firms benefit from sharing a common linguistic and cultural background with their Chinese counterparts. Some Taiwanese companies have been active in the China market for two decades, and have acquired an in-depth understanding of Chinese business culture. This insider knowledge will be very helpful for international corporations seeking to develop the business opportunities that the Chinese electric vehicle market offers. Foreign companies can also benefit from Taiwanese firms’ expertise in both large-volume manufacturing and the small-volume manufacturing of large numbers of different product types; by working with Taiwanese partner companies, international corporations can rapidly reduce their manufacturing costs and retail prices.
“Smart” electric vehicles constitute one of the four “smart” industries whose growth the Taiwanese government is promoting. Taiwan’s Executive Yuan has approved the Intelligent Electric Vehicle Development Strategies and Action Plan, whereby a “model” pilot project will be initiated in 2011. In addition, the Ministry of Economic Affairs has formulated the Key Points Regarding the Provision of Subsidies and Incentives for Electric Vehicle Development, under which the government will be subsidizing the purchase of electric vehicles by consumers in Taiwan. Through these measures, the Taiwanese government is actively promoting the development of the electric vehicle industry in Taiwan.
The White House will go Solar
Maybe the White House was listening after all. It was just a few weeks ago that member students from 350.org went on a solar mission along with environmentalist Bill Mckibben to ask the White House to reinstall solar panels that Jimmy Carter had installed in the 70′s and that were later removed by Ronald Reagan. Just announced today Steven Chu US Secretary of Energy said, “As you know, President Obama (Weekly Address) has a strong commitment to American leadership in solar technologies and the jobs they will create. Through the Recovery Act, we’re supporting the deployment of today’s solar technologies. And we will double our renewable energy generation capacity by 2012. We’re also investing in the next generation of solar power through the R&D programs at the Department of Energy.
Today, we’re taking an important next step. As we move toward a clean energy economy, the White House will lead by example. I’m pleased to announce that, by the end of this spring, there will be solar panels and a solar hot water heater on the roof of the White House.These two solar installations will be part of a Department of Energy demonstration project. The project will show that American solar technology is available, reliable, and ready to install in homes throughout the country. Around the world, the White House is a symbol of freedom and democracy. It should also be a symbol of America’s commitment to a clean energy future.”
On 10/10/10, 350.org will be holding a Global Work Party to celebrate climate solutions and send our politicians a clear message: “We’re getting to work—what about you?