they pick a national champion, they give them the money, they tell them go away and find out what it is we have to do. they built the first thousand kilible a.c. line doing exactly that, the world's largest carbon capture and storage projects are going to happen in the ordos and will be done by the cinwa coal company and are going to be done because that's what the chinese government wants. they also have the door open to the united states to cooperate in any way we choose to do it but we have to just do two things. one is we have to be willing to cooperate with them as partners. as equal partners, and we have to be willing to pull our end of the bargain. we have to come up with our money to match up with their money. we don't have to fund them. they've got plenty of money. we have to come up with our end of the bargain and be willing to see it through. this is a historic opportunity. we can radically accelerate. >> one of the ways of speeding

up how we're thinking is become more cooperative and engaged on projects on a global scale. >> yeah. >> skip? >> let me make this observation and then suggest five bays to achieve scale -- five ways to achieve scale china time that might be useful. . . to achieve scale china time. first of all, the united states just as a normal part of it investing its own economy can in the next 25 years is going to invest something on order of 65 to $70 trillion anyway. that's my in our homes, money in our hospitals, money and our bridges, infrastructure. that has to happen anyway just to maintain any kind of robust economy in the first place. that opens a huge opportunity. if we know it's going to be -- >> the number by the way, that number is larger than all of the investment of the republic from been found in other public until now the. >> it's that scale, exactly right. right. so we have to do that in any case. we redirect that investment away from the inefficient to less

useful, less environmentally friendly through a couple of mechanism. one is to help the policy and help the public understand the imperative and the opportunity. that's step one. images of the future again are critical. secondly, is to provide that sigir. that signal is actually important. it's got to be clear, consistent and increasing over time. >> leasable tells how to get that signal done. [laughter] >> third is to invest, make a continuing and accelerate investment and the human capital we have been discussing about research and development, our workforce, skills, technologies. the next is to align the insipid. i think jim has it right. if we made the incentives out there so he would prefer to invest rather than a $10 billion set up our plans, that's going to get us there. and it's becoming been a means of doing energy services, not any particular form of energy, but a useful energy as required at the moment and at that time, given that business or that hostile. energy sources is a critical

element. and, finally, i like what we just talked to with the idea of collaboration. we need to build more collaborative models. not only within the u.s., but among private university relationships and other countries as will. >> let's hear from lisa and sunil on this question of speed. and the signals, lisa, how do we get these right? >> well, i think that we need to figure out -- one of the issues is that jim's company, duke, is doing all this amazing stuff. but any other utility who may not be doing all this amazing stuff, who may be keeping their grandfather all plans online or whatever they're doing, they get the same perch. so we actually need to put incentives in place so that we does incentivize the bad stuff, the environmental effects, and we incentivize the good stuff. and those things need to be in place over the long-term so, you know, utilities, oil companies,

all of them are thinking in 10 or 20 years time horizons. . . there will be costs but there needs to be this vision of where we want to go. and a willingness to let the market take us there if we can get those incentives in the right place. we need a long-term policy that is hard for policymakers to do. the long best people we have in office for the longest are in for six years. they're still thinking in terms of short and midterm election cycles anyway.

we are in a pickle with our political time, it is different from energy time. it is 10 to 20 years minimum. time being very different from energy time. energy time is 10-20 years minimum. >> one of the issues would be how do we start dealing with this? we interviewed someone to be the director of art school of public affairs. this person had a fantastic idea about focusing reform on the design of our policy formulation structures themselves. if they're not skill to operate fast enough and then they have e rethought and modernize to some extent. i hear you are saying that is a part of all of this also. not just decisions. perhaps that system can't produce the decisions that are needed. >> well, i think that what we need to do is produce the visions and then put in place a structure for making the decisions and figuring out how to tinker with the system on the

backside to make sure that the incentives are all aligned. right now we have incentives going in all sorts of different directions. >> maybe a congress that floats 10,000 bills in the session, perhaps, ought to focus more energy on vision itself and out comes that they would like the country to achieve as opposed to floating 10,000 bills. >> that is their nature. i think it is to us to come up with visions and to say this is what we want and transmit that to them. they'll listen to us, and their way. we need to send that message. we need to say, look, we need to stop dithering. >> a think the biggest thing we can do to accelerate change is to create a culture that where leaders think, leaders in the capitalistic world think about

more than just the return and absolutely return on capital has to be a top priority. we are also human beings. we also said the essence of the country and of the world. their needs to be better on that front. part of the reason we created gigaton throwdown was to create the division of for the community of clean energy to think more than just about return, to think about what of the implications for climate and energy security. it already has had some benefit at least one investor the participated, because he was thinking, this is interesting. by having that same kind of and the debate about scale it has resulted in what he thinks is the most interesting investment in his portfolio. he came in and ask the question. what does it take to get to gigaton scale? and the result after a couple of

months of working on it turned into a most promising portfolio investment. i think that same kind of and vision is possible, and we should expect it from our political leaders. yes, of course they care about votes, and they should, just like capitalists should care about return on investment. it is more than just about votes and politics. we should hold them to a higher standard and expect them to have a vision for what happens to future generations. it is not just about the next election. i would say one final thing, to accelerate what the pace of innovation and the delivery of this new world that we see of the most important thing we could do from a policy perspective is don't screw things up. things are actually moving along. because of innovation in

biotechnology, information technology, materials science, those innovations, many of them funded by the government are accelerating the pace of change. the reason why there are these interesting biofuel companies, the reason why there are advances in batteries and power electronics, the reason why, you know, i have a fuel cell company that is able to deliver a return on investment or payback time of often 12 months with no subsidy. the way that those things can get screwup are messing apple the immigration and the fact that we have got this great power house of a country that accepts people and accept t brad energy and power from all over the world. we are in the process of string that up. the kids grew up the education system.

not at higher levels of education. we are failing at the elementary and secondary level because this new economy that is coming, it is a new clean economy. it is not just for ph.d. it is, requires steel and the ground, welders, pipefitters. as people need to be educated and able to perform at these higher levels. whenever you do out there in the policy world, don't screw with the. we don't actually, we need clear policy signals and the roadmap, but more than anything else we need to not mess up the great strengths of what we have in this country. >> arun and then jim and then questions. >> let me say a few words. we need pervasive and constant innovation. i think we are hearing that. we talked about science and technology. that is sort of obvious. the

we talked about policy innovations, whether it is decoupling or decoupling plus. we need innovations out there. in terms of financing, incentives, yes. let me just come to one that we have not talked about. sunil just touched on, education. i like the idea of stapling a green card to every ph.d. i think that is a good idea. i came here because this is the place, action, where it happened. this is where the country sent the first man to the moon. so we need to create the environment. those ph.d.s that you staple the green card for, that's great. but those numbers are dwindling. those numbers are dwindling because the economy is improving. they came from china and india. those economies are improving. those numbers are going down. we need to have the human

capitol in this country to be interested in science and engineering. for a while i was in the advisory committee for a national directorate. they founded the national academy to do a study of how much. other kids are interested. the number one attractive, you know, profession, this was right after 9/11, that was a fireman. that is understandable. and doctors. etc. engineering came way down below being a priest. i was shocked. i was shocked at that. [laughter] given the current state of priesthood this doesn't make sense. [laughter] and i won't say the in between. anyway, the point is that we need to change that. again we are in a moment.

if you look at the history of science and engineering after sputnik there is a huge bump. the idea of being a rocket scientist was in the jargon of everyone, of the kids. >> one of the things we have done at your old school, by the way, is gone from about eight or 9,000 science, math and engineering majors to 18,000. the reason we have done that is we have changed what is there were focusing on. we have a challenge oriented engineering school, a school of sustainability. that is what these young kids want to be engaged in. if you go to study, you know, differential equations and need to know them, but why do i need to know them? so we focus more on the why. >> i am happy to report that my grandson made a decision to go to engineering school and not be a priest. [laughter] not that the world doesn't need

more priests. i am delighted. i am a lawyer by training. my son is in. i am happy my grandson will build something. let me pick up on something that gary said that i think is very important. there are two aspects to it. one is, when i went to change what i was struck by the fact that -- on a sunday morning, and i was struck by the fact fact tt embedded was a center where the had people there at the campus and a part of the facility working. i was impressed. it gets back to the point of the rd and commercialization tied together. the second thing i want to

quickly share with you is our company is entered into three moes with chinese energy companies. one is the largest producer of electricity from coal, and they are pioneering green gin where they are doing ccs. we are doing @@@@@@@ @ @ @ @ @ we have entered into an agreement with the largest private company which, by the way, is made up of a lot of chinese-americans who got their ph.d.'s here and working for enn. the reason we're doing it is quite simple. one, the chinese have what we have always had, a great can-do spirit. increasingly, i find this is

like the classes of our ancestors. ngly i find it is becoming more like the class of our european ancestors. we spend a lot of time talking about it and not as much can do. but the second thing is most important. we need to be smart enough in this country to recognize they have an imperative, and economic development imperative to scale energy infrastructure as the world people who move to urban centers the way that happened in our country. so what we need to be, have relationships with that are nuanced enough, we cooperate and compete and ride their imperative because i believe there is a reason they lead the world in solar panel in production.

they're building 14 nuclear plants. they are experimenting. they are doing these things and building a coal plant every other week. when you are stealing this kind of technology every plant you build your really innovate and get smarter about. if my mission is affordable, reliable, clean i increased the probability that it will be affordable if i'm working with the chinese and i increase the probability of reliability and clean. their is a lot of political debate b ate in washington about the chinese and americans. my reality is action speaks louder than words. i see their leadership in renewables and these other areas. it says a lot more to me about them building a bridge to look green than all of the chattering we're doing in washington about cap and trade.

>> let's go to questions. raise your hand and someone will give you a microphone. let's try to make sure their questions. >> yes. my question is -- >> say who you are. >> i'm chris bentley. i am with the white house. i am an intern there. all of you have mentioned there is a role for government. each of you seem to have a different perspective on that, but i am just curious. i don't really feel like i have gotten any clear-cut answers as far as what the government should do given the fact that congress is built on individuals who are really concerned about getting reelected. i would love some comments about that. what do we need to do to make sure that the government makes these changes that you all want >> short answers. already talked a lot about focusing on outcomes, that is describing what the outcome is that we are working toward in

this round which is not we will describe to be too wants to tor stab at this? you want to go first, lisa? >> what we might think of as the ideal marketplace. the ideals of the market are insufficient to allow this kind of innovation to move ahead. government needs to take a role. if we need new buyers and sellers of energy efficiency, but they are not there then government needs to help create or incubate through training and education and technology, through the development things to give rise to that opportunity so government plays a complementary role. the ability that people have access to financial means to actually go after these kinds of opportunities. government can play a role in helping shape the design, but then letting the energy service companies deploy, use their skills, use their ability to

make that capitol available. the critical role of government is to complement what when we might think of as the ideal and learn and offset the inadequacies or the weaknesses of our market institution. >> anybody want to add to that? there is a whole new literature that has sprung up. the government becomes engaged. it is a fantastic literature. >> it is actually very simple. it is to enable businesses to create jobs and make money. that is the scale. whether it is in the front end, r&d, or aligning the right incentives and giving the right price signals. that's it. >> there is a vision that the outcome of those people making money and creating jobs will create a certain kind of outcome of the world. >> right. >> that is the part that people have difficulty adding. >> the exact mechanisms for doing that to me are putting a price on carbon.

it needs to be there and stable. the larger context of incorporating these price signals. you know, create and incentivize infrastructure. electricity infrastructure as well as infrastructure in the feul regime that creates a lot of choices. for example, flex-feul cars that can operate on a mix of the ethanol and methanol. making sure that immigration reform is there and education systems are conducive to increasing the amount of talent and expertise in this country so that we have good paying jobs. making sure we have a regulatory scheme through decoupling and adding incentives. making sure that you don't mess it up by disallowing states from being able to do the same kinds of innovations. one of the problems with the federal government is that the likelihood of action at the

federal level sometimes dampens enthusiasm for action at the state level. there's all kinds of interesting innovations. we have not mentioned the pace program which is a great way to encourage energy efficiency and solar and other kinds of generation through property taxes and levies. always had some great success. >> do this within a 20 year framework so that the policy remains consistent over time. >> okay. next question. >> thanks. >> john harper with npri. my question is for mr. rogers. if anyone else has comments i would appreciate it. barring major government subsidies or carbon regulations, do you envision a time frame for the development of commercially viable smart grids on a state or national level? >> my judgment is that

modernizing our grid -- we build our great with analog because that was the technology that was available. we produced electricity delivered 99.9% of the time. we moved to digital technology. that will enable the plug-in hybrid. that will enable our ability to manage solar on the roof top. we are prepared to make those investments, and we will make those investments. but what you find, what we are finding is that we started out looking at 900 different companies in the funnel. we dug into 250. and we tested the products of 100. we are piloting five. there are a jillion great ideas out there, but trying to get them narrowed down to the ones that really works is a challeng. the real challenge is the immigration in egration in the .

no one, each company has its own deal. there is no company in the historic suppliers like ge or siemens or abb this isn't where they make the big part of their money. so in a sense we are creating a capability of integrating the technologies and actually building the road map of how you upgrade your distribution and you create the apps beyond the meter and you tie it all together in communication. that is really the better way to talk about. i have tried to get away from using the word smart grid because everybody has a different definition. it's like 10 blind man standing around an elephant trying to

describe it. i try to narrow its to upgrade the grid, come up with the apps. >> a state regulatory commission that regulates price might not necessarily be the best government mechanism for a technology company looking to advance technology. it is one of those things that is probably outmoded. >> i would say maybe not. i am reluctant to challenge the president. [laughter] >> mr. chairman, go ahead. >> and that is, state commissions really understand the balance between affordable, reliable, and clean. you have to think about it as 50 different laboratories around the country. some of our states have been very supportive of us doing this in terms of smart, in getting the right incentives for energy efficiency. other states have said let's do pilots. other states have taken different approaches. our point of view is that if we

can't convince them of the value for in the consumer then it is our fault. so we are going to prove it one way or another because we believe deeply that it is the right thing to do. but i think it would be a huge mistake, and i know lisa hinted at this, having the federal government step in and mandate things. over the last hundred years state commissions have done it. that is why we have universal access where the real price of electricity is flat. that has been done by state commissions, and with the right charters they can also achieve this transition. >> i think this is kind of where the vision thing comes in. we don't need to know what color the cat is. it needs to catch mice. we already regulate gasoline based on performance standards. we don't tell bp which molecules we want in it. we say we want them to explode this way when they are in your

engine, and we don't want them to fly off into the air when they are lying on the ground. we have performance standards. there needs to be real-time pricing for consumers. i am interested in my scripts, but i am also interested in enabling the ron popeal. he is the pocket fisherman and the stovetop rotisserie. that is exactly what we want on the smart grid. we want the weirdest possible solution to air-conditioning that pulls an electoral load off the grid in the heat of the day. it is not necessarily going to be something that i come up with sitting in an office, and it is not right to be something to end comes up with sitting at the utility. it is going somebody sitting in

a trailer saying, we can do this differently. here is how. that is the opportunity. that is where the vision thing comes in. >> you started with subsidy. jim nailed it right. we need to move away from words like subsidy and instead and investing in our population and labor force and providing the incentive. one in the front. one in the back. >> we talked a lot about increasing the speed of innovation and ecosystems. how do we enhance, improve the speed of our monetary analysis and feedback systems, so that we can also avoid some of the problems like we have seen with

corn ethonal. we introduce some of these new untested technologies. >> you could have imagined the price of tortillas will be affected by energy decisions in the united states. >> actually, another example. we need to print think through e unintended consequences. you can't always identify them all. you need to have a little things in terms of solving it. take shell gas, which everybody calls the game changer. we don't quite know what the environmental impact is point to be of that yet. we know that water, from arizona y'all really know this. we have seen it all across our country. water could be the next oil in the 21st century. if shale gas takes an incredible amount of water with chemicals and the potential