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Obstacles to decarbonization are 'mostly political,' former Md. governor says

➤ Former governor recommends states 'push the envelope' for green goals.

➤ New jobs will follow the incentivization of renewables, O'Malley argues.

➤ Regional Greenhouse Gas Initiative could expand to other sectors, he says.

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Former Gov. Martin O'Malley.
Source: University of Virginia

Martin O'Malley, who served as Maryland's governor from 2007 to 2015 and ran for president in 2016, spent much of 2018 traveling the country to campaign on behalf of Democratic nominees for Congress and governorships. Less than a month before the Nov. 6 midterm elections, O'Malley estimated that he had visited 29 states to stump for over 100 candidates up and down the ballot, with many of his speeches focusing on energy and the environment as winning issues for his party in the 2020 presidential election.

During an Oct. 17 event at the University of Virginia's Miller Center for Public Affairs, O'Malley outlined a progressive energy platform that Democrats could implement if elected. This notion has gained traction in recent weeks, with incoming Rep. Alexandria Ocasio-Cortez proposing a "Green New Deal," and Senate Minority Leader Chuck Schumer declaring that permanent tax incentives for renewable generation and battery storage must be included in any infrastructure package taken up by Congress in 2019.

S&P Global Market Intelligence spoke with O'Malley before his address. The following is a condensed and edited version of that interview.

S&P Global Market Intelligence: What is the best way to approach a renewable portfolio standard: aiming for 100% clean energy like California, or a lower figure like your state did in 2017 with a 25% target?

Martin O'Malley: Given the fact that policy is being so greatly outpaced by technology, I would think that the only responsible course of action is to push the envelope of what's possible, realizing policies that you put in place today are probably already going to be three or four years behind the technology curve once they're implemented.

We don't really have to guess anymore. We know the scale of what works, and we've never had a better ability to model the dynamic in terms of energy usage, production and conservation than we do right now. So as we move beyond the goal to actually realizing the goals, that'll be the key. Small things done well make bigger things possible. The public needs to see that we can actually make progress on these things.

So with all these positive circumstances in place, what are the remaining obstacles to a decarbonized grid?

They're mostly political. I think some are financial, in terms of the sunken costs. I had lunch with the leadership of Apex Wind Energy, one of the largest wind companies in North America, and I said to them, "Imagine how totally hopeless we would be if our politics were all perfectly aligned, but none of the technical curves were moving in the right direction?" This is the reverse of that. The technical curves are outpacing anybody's wildest imaginations.

What's been lagging is the political consensus. And you see that it lags over age cohorts, and you see it lags in particular in our primary representative institution being Congress, as it suffers from gerrymandered districts and concentrations of wealth and the absence of other needed reforms. But that'll change. That's a consensus that's going to allow a lot of really impactful actions to happen in short order.

In Ocean City, Md., residents refused to accept free electricity from US Wind Inc. in its attempt to build a 750-MW offshore wind farm. What do you make of that, and how in general can stakeholders become more unified?

Whether you're talking about a new grocery store or a new wind turbine, you'll always have those siting issues. The Chinese don't have them, but then again I wouldn't want to trade our freedoms for their speed of central planning.

What I hear out there across the country is a new way of talking about our clean energy future, and wrapping it in the language of opportunity and greater health and well-being. It's not an appeal that begins from a standpoint of despair or disaster or pending planetary destruction, though all of those things are definitely in the offing. But it's an appeal that begins from a standpoint of greater opportunity: more jobs, not less. That's been an exciting political shift that I see out there.

The public understanding about the cost of new solar and new wind is definitely lagging the reality. The Apex guys told me they bid on a project where it was a 1 cent/kWh, and they got outbid. They said they could not have imagined a reality where anybody would be getting financing for bidding on a 1 cent/kWh project.

Maryland was home to a BP Solar International Inc. manufacturing facility, but it ended up closing in 2010. How can states incentivize those companies?

I met with the leaders of it, who were telling me that they were about to announce a big expansion and were asking for some tax credit help. And then the next thing I know, without a call, they're shuttering two months later.

The most important thing you can do is put policies in place that accelerate the shift to 100% renewable energy, and I think the manufacturing will follow. One is not only dialing up the portfolio, but the other is reimbursing utilities for providing a dynamic grid, rather than based on how much of a certain commodity they can burn and how much can we use. Another one is net metering.

Do you see the Regional Greenhouse Gas Initiative, of which Maryland is a member, expanding to transportation and other sectors?

Yeah, it sure could. Like so many things, once states show that it can be done individually or as groups of states, then it becomes easier for Congress to move. I don't think we should stop; we can't afford to stop at just a 100% renewable grid. I think consumer demand will force us to go for lower-cost vehicles over their lifecycle, and the lack of having to put gas in them is going to make that change happen very fast.

It was only within about a 10-year period of time from 1910 to 1923 that we developed a national highway system. There wasn't one before that. So in this day and age, things can happen even faster. The sunken costs of fossil fuel extraction and the traditional ways of transport is a problem. It's a financial problem, but financial problems like those or financing a world war are things that can be done over generations, especially when the imperative is as real as it is.