Episode 147: Kate Gordon, Senior Policy Advisor on Climate to Governor Gavin Newsom & Director of the Office of Planning and Research for California

Mar 8

This week's guest is Kate Gordon, Senior Policy Advisor on Climate to Governor Gavin Newsom & Director of the Office of Planning and Research for California.

The California Governor's Office of Planning and Research serves the Governor and Cabinet for long-range planning across three significant buckets: land use and planning, climate risk and resilience, and sustainable economic development. As Senior Policy Advisor on Climate, Kate focuses on California's climate initiatives across policy, leadership, and budget.

Kate has spent the last 15 years focusing on the intersection of clean energy, climate, and economic growth. Before she was appointed OPR Director and Senior Policy Advisor, Kate served as the founding Executive Director for the Risky Business project at the Center for the Next Generation. The Risky Business Project works to quantify the economic impacts of climate change on US energy demands, crop yields, and coastal infrastructure. She has also taken on senior roles at the Apollo Alliance, the Center for American Progress, and the Paulson Institute. Kate holds a J.D. and a Master's in City Planning from the University of California, Berkeley.

I was looking forward to this episode as policy plays a crucial role in a clean energy transition. Kate's knowledge and experience led to a lively discussion about the role of state government, public sector climate initiatives, and federal policies. She explains why California is unique and key ways the state is taking action to accelerate the transition. Kate also talks about her climate journey, what motivated her to work in climate, and her role in the Governor's office.

Enjoy the show!

You can find me on Twitter @jjacobs22 or @mcjpod and email at info@myclimatejourney.co, where I encourage you to share your feedback on episodes and suggestions for future topics or guests.

Episode recorded February 9th, 2021.

In Today's episode we cover:

What led Kate to focus on climate
Kate's role as director of the Governor's Office of Planning and Research as well as Senior Policy Advisor on Climate
Why OPR is so unique in comparison to other State governments
How Kate's team determines what to focus on and how to balance aggressive policy without overstepping as an agency
How the various climate agencies work together to make equitable and successful decision that weigh both public interest and the voices of the private sector
The Climate Catalyst Fund, the Governor's low-interest loan and loan guarantee program
How California's zero-emission commitments and climate initiatives come to fruition
Where California sits in terms of success on its climate initiatives
How the agency thinks about staging has comprehensive plans are rolled out and announced
The dynamics at play between State and Federal policy and how California stays consistent with its actions and priorities even as federal administrations change
Kate's thoughts on how the federal government can accelerate a clean transition
What the Biden Administration can accomplish in its first 100 days and first four years
The most impactful initiatives within tech and policy that can accelerate climate progress
How California will reach its carbon-neutral and zero-emission commitments
The effectiveness of taxing emissions as it relates to incentivizing individuals to emit less
Advise Kate has for those transition into climate

Links to topics discussed in this episode:

Governor's Office of Planning and Research: https://opr.ca.gov/
Please note, Kate misspoke when she mentioned the Climate Cabinet Fund; she meant to say the Climate Catalyst Fund. For more information about the Climate Catalyst fund and the Governor's plan: https://calmatters.org/environment/2020/01/california-budget-billion-dollar-climate-innovation-loan-fund/

Jason Jacobs: Hey everyone, Jason here, I am the My Climate Journey show host. Before we get going, I wanted to take a minute and tell you about the My Climate Journey or MCJ as we call it membership option. Membership came to be because there were a bunch of people that were listening to the show that weren't just looking for education, but there were longing for a peer group as well. So we set up a Slack community for those people. That's now mushroomed into more than 1300 members. There is an application to become a member. It's not an exclusive thing. There's four criteria we screen for; determination to tackle the problem of climate change, ambition to work on the most impactful solution areas, optimism that we can make a dent and we're not wasting our time for trying and a collaborative spirit. Beyond that, the more diversity, the better.
There's a bunch of great things that have come out of that community. A number of founding teams that have met in there, a number of nonprofits that have been established, a bunch of hiring that's been done, a bunch of companies that have raised capital in there. A bunch of funds that have gotten limited partners or investors for their funds in there, as well as a bunch of events and programming by members and for members and some open source projects that are getting actively worked on that hatched in there as well. At any rate, if you want to learn more, you can go to myclimatejourney.co, the website and click, the Become A Member tab at the top. Enjoy the show.
Hello everyone. This is Jason Jacobs and welcome to My Climate Journey. This show follows my journey to interview a wide range of guests to better understand and make sense of the formidable problem of climate change and try to figure out how people like you and I can help. Today's guest is Kate Gordon, the OPR director, which is the Governor's Office of Planning and Research for the State of California. Kate has spent the past two decades working at the intersection of climate change, energy policy and economic development. She was appointed director of the Governor's Office of Planning and Research and a senior advisor to the governor on climate by governor Gavin Newsom in January, 2019. Kate is also trained as a community organizer and later in law and regional economic development. Her focus has long been on bringing diverse groups together to work towards a more sustainable inclusive economy.
Before she was appointed as OPR director, Kate was the founding director of the risky business project, which focused on quantifying the economic impacts of climate change on US energy demand, crop yield, and coastal infrastructure, as well as on human health and mortality. I was really looking forward to this one because policy is just such an important lever in the climate fight. State government has such an important role to play, and California has really been setting the tone. We cover a lot in this one and I really hope that you enjoy it as much as I did. Kate, welcome to the show.
Kate Gordon: Thank you. I'm so glad to be here.
Jason Jacobs: Well, I'm glad to have you. We were chatting a little bit before I hit the record button and it turns out that we went to the same undergrad, although we missed each other by a year. And so that's one reason I'm excited [laughs]. But another reason that I'm excited is because I spent my whole career in startups and focusing on climate for the last two and a half years, I've come to believe that policy is so important and actually not just federal policy, that what happens in the State really matters. And I think out of all the States in our United States, you are sitting in an interesting spot, in an interesting State to talk to. So I'm so excited to learn from you today.
Kate Gordon: Thank you. It's great to be here. I mean, I started working for the State of California a couple of years ago, and I'm always amazed by how big it is and how diverse it is. I think people sometimes think, Oh, you know, California is so different from the rest of the United States and the world because it's out there doing its lefty thing. In reality, we're just this enormous State, 40 million people, incredibly diverse we're oil and gas producers. We have a forest sector, we have an Ag sector, we've got all this technology, we've got all this manufacturing. So in some ways I almost feel like it's a microcosm in a way, of what's happening nationally and in some cases globally. So I, you know, it's super exciting to get to be at the forefront of all this stuff.
Jason Jacobs: I have to say, I'm a little nervous for this discussion because relative to when I bring on climate solutions, startup for acts or things like that, I'm a lot more out of my element, but I think this is such an important topic that I'm going to put on my, my big boy pants and try to muscle my way through it here.
Kate Gordon: Well, Jason, you just told me [laughs] before we started recording that you were an American Government major in college. So, you know, I'm expecting some serious separation of powers questions here. [laughs].
Jason Jacobs: And you're too nice to repeat the rest of what I told you about [laughs] what a slacker I was in college. So don't be misled by the, the American Government degree. But at any rate, what I typically do with guests is we just start from the top with what you are doing currently and, and where that sits in relation to the State of California and the climate world.
Kate Gordon: Yeah, it's a great question, particularly because the office I run in California doesn't exist in a lot of other places. So I run something called the Governor's Office of Planning and Research, which is a, it's a department within the governor's office. Our focus is long range planning and issues that are cross cutting across other agencies and departments. And we serve in an advisory role to the governor and to the cabinet. So a number of, kind of pieces of the climate challenge fall into that because climate change is long-term by nature, as well as being very current. We do kind of three big buckets of things. We do land use and planning. And there's a big climate overlay with land use and planning because of the amount people drive in California, in particular. We do climate risk and resilience. So we kind of run the State program on climate resilience.
I'm thinking about current climate impacts, wildfire, extreme heat, flood, sea level rise, impacts on regions across the state and on communities and on the economy, through that. And then our third big area is sustainable economic development. So really thinking about what I think is in some ways the most important issue facing all of us working on climate, which is what is the transition actually look like. All of these places like California have committed to carbon neutrality, right? We have a commitment to carbon neutrality by 2045. We have a commitment to clean energy by 2045. We have all these commitments. What does it actually look like to get from where we are today to that? It's not a switch you turn overnight. It's a transition of every sector, every region, every industry. And so a lot of what we do at my office is work on what does that transition really look like? And how does it work on the ground?
I'm also the governor's senior policy advisor on climate. So the stuff I don't do in my office of planning and research, I do generally on climate, which is a bunch of other stuff that kind of falls, you know, across the board. How do we spend our budget on climate initiatives? Where are we prioritizing in terms of policy? What is California trying to show leadership on globally, stuff like that.
Jason Jacobs: So you mentioned one thing that I just want to come back to, and, and that's that a cross-cutting organization like this, isn't a common thing in State governments. So why is that? And how did it come about that California was blessed to have such an organization that could think longterm in this way.
Kate Gordon: It's an interesting question. You know, government, I think in general can get really siloed. You see that a lot, right? In the federal level and the state level, less at the city level, actually 'cause people who are working in city and County government kind of have to do everything all the time. They're right there on the ground and everything is sort of top of mind. But state and federal, you just tend to get these really siloed agencies. Like there's the environmental agencies, there's the transportation agency, there's the housing agency. In California, this was, my office was started back in the seventies. And I think the reason was that it was increasingly clear that land use was just such an important issue affecting kind of everything. It's a housing issue, it's a transportation issue, it's a pollution issue. It's a, you know, it's a, it's a sort of economic development issue and the state didn't really have a way to think about it.
California is really strong on local control. We give localities an enormous amount of power on planning and zoning. And so I think there was a recognition back in the seventies that the state needed to have a hand in thinking about the overall growth of the state across regions, because ultimately it's our responsibility at the state level to think about how all those things interconnect. That was the original theory. It's grown from that, I mean that the addition of the climate resilience piece really wasn't until a few years ago. From the legislature, and that was frankly just the extreme impact of all these things that have been happening to us, fires in particular, top of mind, obviously. But we also just came out of a drought. That those are significant issues that cross municipal boundaries, cross issue boundaries and are just issues across the state as a whole. So I think it was a combination of those things.
Jason Jacobs: And there's lots of things I could ask about as it relates to your work with OPR and, and as a climate advisor, but taking a step back maybe even way back, where did all this come from? I mean, when you were a, a liberal arts undergrad at Wesleyan, had you been turned on to being concerned about the environment and sustainability and, and did you envision for yourself a career in public service or how, and when did, did all that come about and, and why?
Kate Gordon: Yeah, I'm, I'm unusual actually in the climate world and that I don't come from an environmental background. At Wesleyan, I did a lot of work on, I was an American Studies major. I did a lot of work on housing actually. And my undergraduate thesis was all about how cities are designed to like exclude, in America, to exclude people or embrace people and sort of how that actual physical design related have history to how people have been excluded in looking at things like urban sprawl and the growth of the suburbs and red lining. And so I've always been really interested in places and in the relationship between places and economics, instead of economic access and equity. I ended up going to law school and did a joint degree in law in city planning and with a focus on regional economic development. Because again, I've just always been super interested in sort of how do these systems, economic systems, planning systems, structural legal systems lead to the opportunities people have, or don't have.
And I kind of like many people, kind of fell into that becoming about climate change. I was working as a lawyer after I graduated from law school, I was at a small impact litigation firms. So our firm really focused on sort of like class actions in consumer rights and civil rights at the appellate level. And super interesting work but it just happened that, that firm, which had started in Oakland office, which I was in, only had like two other lawyers in it. And one of them was the first who started the firm and he was sort of a mentor to me. And I had gone to do that fellowship because of him. And, you know, accidents of life, two days before my two year fellowship, he got into a terrible car accident and was out for a year and a half, in the hospital.
So two years of my fellowship, a year and a half of that, I did not have anybody to work under or any kind of mentorship or any kind of support, which is incredibly challenging as a first year lawyer. I mean, it's a very complex system. You have to understand all these rules, you have to understand all these things like the font size of footnotes, right? Or the difference between your brief getting accepted or thrown out in the Ninth Circuit. So it was really isolating. And at the end of the two years, they wanted me to stay on and become a staff attorney in that office. And I was like, "I can't do this." Like I can't not have a team. I can't be in this isolating an environment. And I happen to have an opportunity, a former professor that I knew really well from law school who I had worked with in law school, it was at University of Wisconsin.
And he said, "Hey, we're starting this Institute at the university, which is going to look at the economic development implications of clean energy and like looking at how do we move away from imported at the time, imported natural gas, imported oil, you know, how do we do that in a way that creates good jobs and economic opportunity, and really like makes these places into vibrant places." And I thought, you know, this is my economic development background, it's super interesting. Ended up moving to Madison where I'm from. So it wasn't that crazy. But ended up moving to Madison, working for four years on what became the Apollo Alliance, which was actually the first green jobs organization. It was the organization that provided all the green jobs research and background and talking points to the Obama campaign to the Clinton campaign back in 2008. Ultimately did a whole bunch of work around the Recovery Act under Obama, the American Recovery and Reinvestment Act.
So I kind of fell into it in a way, it was very much natural from my background. But that opportunity just who could have guessed that that would have happened, right? And so that led into me then kind of being recognized as somebody who was making these connections between the economy and clean energy. And then ultimately leading into the economy, clean energy and climate change. And it was kind of the beginning of a wave. So that's really how I come about it. And I still think of myself as an economic development person first, like, uh, equitable and sustainable economic development person who thinks of climate change as this big macroeconomic force. That's going to reshape industries, reshape communities, reshape regions. And how do we think about doing that in a way that makes sense for people and make sense for the economy? So that's really where I come from. Very unusual, 99% of people in the climate world come from environmental sciences backgrounds or environment backgrounds generally. And so it, it's kind of an odd story. [Laughs].
Jason Jacobs: Yeah. Although I would suspect, and I'm no futurist, I don't have a crystal ball or, or anything like that, but that due to the systems nature of the problem and the fact that it truly does touch everything, the more, it kind of grows from like a little niche of, of activists to something that is pervasive in terms of the wholesale change, that's required sector by sector and region by region and function by function, et cetera, that there'll be so many more skillsets and backgrounds that wouldn't have been thought to be relevant for climate that are not just going to be relevant, but going to be essential.
Kate Gordon: Yeah, I think that's right. I mean, I, I've been really struck by kind of, I think it was like 10 to 15 years behind in some ways, but I've been really struck by the way that people are talking. And now the Biden Administration is talking about climate as a whole of government approach. That's something we've done in California for the last two years. You know, the Green New Deal is obviously a very integrated system wide approach to climate change. Sort of a funny because when I was at the Apollo Alliance, we actually put out a Green New Deal back in, I think, 2005 or something. So it's definitely a concept that has been around and percolating, but you know, like all policy, frankly, it takes the right moment, the right messenger, the right opportunity to really make this stuff big. And obviously that happened in the last couple of years with the Green New Deal.
But I, I agree with you. I think this is a systems issue. I mean, one thing we talk about a lot now, you know, I'm again like one of the early green jobs people, but I talk all the time now about how we shouldn't be talking about green jobs. We should be talking about greening the entire economy. Because this really is an economy wide project. It's not about some niche sector with a specified kind of job. It's really about a different way of thinking about carbon and about how we use energy, how we produce energy and how we run the overall economy. So I think it's a major shift. People underestimate what a big shift it is, but it also is a ton of opportunity.
Jason Jacobs: So one of the things I wrestle with, and I'd love to get your input on is that there's these kind of chicken and egg phenomenons, where because everything is so interrelated and even interdependent, you can say like, for someone that wants to help, you can say, "Well, it doesn't matter where you start because we need to bring about change. We need corporations to act, in order for corporations to act, we need policy. In order for policy, we need the right bills to get pushed. The right bills get pushed from the right people, get an office. The right people get an office when people vote, the right, you know, vote when they get educated. They educate when you fix the schools, right?" So on the one hand, it doesn't matter. But on the other, it's easy to pass the buck. So as you sit as essentially a state entity, how do you figure out who's going to do what and what the right balance is between policy being aggressive enough without overstepping its bounds?
Kate Gordon: It's a [laughs] it's a big question. It's a really good question. And I think we struggle with it all the time. I will say on... I'm kind of taking an integrated approach or assistance approach, as you said before, and so then how do you figure out who's in what lane, sort of how we talk about it, and like, when do you have to join together, the lanes together? That is not easy, right? I mean, I think anyone who's ever worked in a big corporation knows that's not easy, right? It's hard to get divisions of a corporation to work together. It's hard to get divisions of government to work together. It's the people have different cultures, they have different approaches, they have different backgrounds. One of the things we started doing at the very beginning of this Administration under Governor Newsom was that we put together, and I actually now coordinate this Climate Cabinet, which is like the subset of the Cabinet that has the folks who have anything that touches on climate, which you could argue is absolutely everybody, but basically it's energy, housing, transportation, business.
I'm definitely forgetting somebody. And then all this sort of regulatory agencies. And we run that as a way to kind of check in with each other. It's partly education because each of those different agencies has different stakeholders and here's different things from different people. So something that comes out, here's an example, the governor recently at the end of last year, did a big Executive Order on preserving 30% of all of our natural and working lands and our coastal waters by 2030. Actually, the Biden Administration has done that since we did it. And by conserve it doesn't mean wall off. It just means making sure they stay as natural working lands and don't get converted to urban uses.
Jason Jacobs: So it's not going to be meant to be like a venture capitalist beach house or something-
Kate Gordon: Yeah [laughs].
Jason Jacobs: -With walls around it.
Kate Gordon: Yeah, exactly [laughs]. And I should say working lands means like agriculture and forestry and stuff. So it's all these different things. So there's an obvious story to tell about that from like a biodiversity perspective, right. But then there's also a story to tell about that from a carbon sink and carbon sequestration perspective. Like you can store more carbon in the soil if you protect the soil. There's also a story to tell about that from a climate resilience perspective. If you drive through Napa right now, you can actually literally see where the vineyards stopped fires from hitting developed areas of Napa. The thing that I think folks hadn't thought about as much, but the climate [inaudible 00:18:57] it was a place where this came up is the reaction to that from the housing developer community was, you're closing off all these options for us to develop, right? Like where are we going to put housing?
We were in a housing crisis. So you also need to be thinking through at the same time. Okay, what are the parallel policies that we have that actually streamline housing development in places that are near jobs and services and transit, so that we're doing infill housing where it should be built, where there's more density. How do we make that easier, at the same time we're protecting all this land. You can't ignore that piece of it, right? You can't ignore the questions about, what does it mean for clean energy development? If we need all this utility scale, solar and wind to meet our clean energy policies, where are we going to put it if all this land is conserved? So that whole negotiation on what do you mean by conservation and where do you put big solar and wind [inaudible 00:19:43], that's another part of that conversation.
So I think what it gives us is an opportunity to just think this stuff through ahead of time, instead of being surprised by it. And having sort of stakeholder opposition without having thought about it. I think it's really important because we can be honest with each other. We can fight some stuff out. We don't always agree, but nobody wants to be disagreeing in the media and nobody wants to be surprised by a position. And so I think it allows us to really think that stuff through, it is really not easy. I was joking with someone in the Biden Administration, they're taking a whole of government approach on climate and it's really challenging to do because everybody coming into that space is an expert and a leader in their own right. And has been working on climate for decades. So how do you organize those people into a comprehensive systems based approach? Not easy, but I think totally necessary for us to succeed.
Jason Jacobs: And you talked about getting the diversity of perspectives from the different stakeholders in the Climate Cabinet, which makes total sense. What about the voice of the people and what about the voice of industry? Where do those fit in? How do those fit in and how much do those fit in?
Kate Gordon: Yeah, they fit in a lot. I mean, each of our agencies is very public facing, so we have enormous amount of public interaction. For instance, the California Natural Resources Agency runs all the parks, right? So there's a big public facing part of that. And the State Water Systems and you know, all these just pieces that are all part of that. Oh, I forgot agriculture, they're on the Climate Cabinet. So the agriculture system is interfacing with farmers and ranchers all the time. That's their constituency, right? Transportation is interfacing with all the regional transportation planners, but also the developers. And also all the people who rely on transportation, which is essentially everybody. And then GO-Biz, the governor's office of planning and research is on, sorry, the governor's office of business and economic development is on the Climate Cabinet. And they're the portal to business, basically. They're like the direct ombudspeople to the business community and the state government.
So I think we have a lot of stakeholder engagement through each of the agencies that then bring that to the table. But also on your point of an industry, which I think is a good one. And you asked about earlier too, a big part of what I'm really interested in. And it's partly because of work I did before coming into the governor's office is how do we think about the actual fiscal and economic impacts of climate change of current climate impacts and a future climate policies and regulations and this transformation we're talking about and how do we actually embed that into how we're thinking about finance and how we're thinking about procurement and how we're thinking about spending in our state budget and how we're working with companies to prioritize those who are thinking ahead to that transition and supporting them as much as possible.
So I think that's just really important. There is no way we do this thing on climate without the private sector. Government is a drop in the bucket in terms of money and yes, obviously influence and regulatory power, but this cannot be done through regulation, this is gotta be a partnership. So we spend a lot of time thinking about that and, and setting up systems. We just, in the budget that the governor just put out well, that he put out last year, we created something called the Climate Cabinet fund. The legislature created something called the Climate Cabinet fund. It's a low interest loan and loan guarantee program that basically we use government money to de-risk projects out in the private sector that are kind of innovative projects to reduce carbon emissions and also build resilience.
And in this current budget year, the governor is arguing for support into that program for a number of things. So that's unusual for California. It's basically the Green Bank Model that many other States have done and many countries have done. But California has never done it before. So for us, it's kind of a new foray into that public private partnership on climate.
Jason Jacobs: I've seen on the last few months, I think, correct me if I'm wrong. But back in September, there was a big pronouncement from Governor Newsom about zero emissions vehicles by 2035. And when these types of big pronouncements come about, how much of that is top-down based on what the science says we need versus kind of bottom up in terms of what you think is possible and, and how much work has been done to connect those dots before those pronouncements go out the door.
Kate Gordon: It is both of those things. It is a lot of inputs from different places. So, you know, when I came into my job as senior advisor on climate policy, one of the first things the governor asked me to do was to look at all of our existing goals in the state. Our high level goals, again, carbon neutrality by 2045, a hundred percent clean energy by 2045. The, uh, Oh, we have so many. Our low carbon fuel standard, 10% below average carbon intensity of fuel. I'm not even gonna be able to tell you the all of them, there's like a hundred of them. But anyway, we have a lot of goals. And he said, "Look at all our goals and figure out where we are, how are we doing and where do we need to make more progress? And that's where I want to prioritize." And what we realized after doing that analysis was we're doing pretty well on a number of them.
I mean, California has the huge advantage of having set many of these policies a long time ago. Our initial cap and trade, low carbon fuel standard and renewable energy standards were all set back in 2006. So we've been living with this system for a long time. So we've made some good progress, but we had two big areas that we just have not made enough progress. And one of them is transportation, which is our single biggest area of emissions. If you count our vehicles, [inaudible 00:25:20] emissions, plus our extractive industries. So oil and gas extraction and refining, it's 51% of all our emissions in California is huge. We were not making enough progress there. And then the other big one was we didn't even have goals on the contribution of our natural working lens to our climate agenda. And that's something that internationally like scientists have said you have to. Land has to be part of the solution, right?
You have to think about the role of land. So looking at the science and looking at our own progress, we basically came to those two things as critical areas we had to focus. The third one, which is also coming from the global science community is none of us is going to reach any of our climate goals globally without carbon removal. So we're starting to talk about, you know, the role of land in removing carbon from the atmosphere, but also about technology solutions to removing carbon from the atmosphere. That's new for California, as well as California had been basically laser focused on technology solutions to reducing emissions. And it's really become clear that we have to go to a much larger range of things and make it an olive economy kind of approach.
So, so I would say we came to kind of the big things the governor has taken action on in the last two years basically are around transportation transformation and natural working [inaudible 00:26:36] because of that analysis. How that then gets turned into an Executive Order is based on a whole bunch of things, specific input and data from our regulatory agencies, particularly the Air Resources Board of California, Energy Commission and the Public Utilities Commission, a enormous amount of kind of political analysis [laughs] and also economic analysis, talking about zero-emission vehicles.
What does the vehicle market look like today in California, right? How many cars are there? Who's buying new cars? Who's buying used cars? What kind of cars are they buying? Are people getting rid of a car when they buy a new EV, like all of this economic data that goes into those decisions and how we do policy to get to our goals. And you'll see, actually in the governor's budget, there's a big emphasis on used electric vehicles on our vehicle retirement and replacement program, which essentially is a program where lower income Californians can get rid of a car that doesn't pass smog and can get a voucher for getting into an electric vehicle. That's a great program from an emissions perspective because it replaces a car with another car instead of just adding an electric car [laughs] to a vehicle fleet. And it also is like very equity focused. So it's a bunch of different information that goes in honestly, and you know, some of it's politics.
Jason Jacobs: And once you have that proclamation and then you go through and do that analysis philosophically, and, and maybe the answer is case by case. And it depends on what we're trying to get done, but philosophically, do you start to put some wins on the board, as you find some small wins and pick them off, you wait until you have a comprehensive plan and then roll it out in stages, but it's pretty baked before anything goes out the door. Like, how do-
Kate Gordon: Yeah, it depends.
Jason Jacobs: -You think about, how do you think about staging?
Kate Gordon: [Laughs]. It really depends, you know, I actually have to say for me, I really have learned a lot from work I've done with the private sector on setting interim goals. 'Cause I think interim goals and targets are really important because you just don't really know. And particularly in the energy and vehicle technology space, we just don't really know exactly what's coming down the pipe in terms of technology advancements. So you can't decide one technology is going to win. One approach is going to win. You really do have to stay somewhat flexible. I will admit that it's hard to do in a political context. The political world doesn't love flexibility, right? I mean, legislators like to set rules and have like big pronouncements with roles and there's a whole bunch of push and pull on trying to create flexibility within those rules because we all know that the private sector needs flexibility.
So it's a constant battle, but yeah, it depends on the thing. We do try to project out with the best available information. We do try to see where we have to be by certain benchmarks in order to make the longterm goal and think about the policies within each of those, each of those shorter periods of time. But you know, again, nobody can decide, like nobody can say for sure what's going to happen. I, as an example, I remember back when I was working in DC at the Center for American Progress and everyone was excited about cellulosic ethanol. This was like 15 years ago and everyone kept saying, "It was like, 10 years out, it's 10 years out, it's 10 years out. We're going to be able to take, like, we're gonna stop having to having this food energy debate. We're going to take all the like switchgrass and Corn Stover and we're going to turn it all into fuel and that still has not come to fruition."
So if we'd based an entire set of policies on that, then we would've had to rethink everything, right? If we'd based loan programs where you could only spend the money on that, we would have had to, you know, write new legislation to amend those, which is really hard to do. So I just think you got to kind of keep that flexibility, especially when it comes to technology, because technology in this field is either much faster or much slower than we think it's going to be [laughs], frankly.
Jason Jacobs: As it relates to the dynamic of federal policy versus state policy, how much do the actions and priorities of the State of California change depending on what's happening at the federal level and how much stays consistent from administration to administration no matter what?
Kate Gordon: Some of both. The federal government's really important, particularly right now, right? When you're in a recession, the federal government is really important. And the main reason for that is that California, like many States has a balanced budget requirement. We have to balance our budget under our Constitution. So anytime we're spending more than usual, which we are seriously doing right now, like we're spending enormous amounts of money, as you can imagine on COVID response, vaccine distribution, all of the school-related expenses that come with remote learning, all of the social safety net stuff, unemployment, right? You know, Food Stamps, everything. If you have a good relationship with the federal government, they reimburse you for a lot of that stuff. So we just got, for instance, word from the Biden Administration that we're going to be reimbursed for this huge program.
We did call it Project Homekey, Project Roomkey, which was basically getting homeless folks into housing over the last year so that we could reduce the risk of COVID among homeless populations, really cool program. That's going to now get reimbursed, which now means that the amount of money we spent on it gets opened up and we can spend it on other things in our budget. So it makes a really big difference. It's the difference between frankly, the entire budget going to safety net issues and like required spending and having anything in the budget for innovation, for new policy, for, you know, for anything new. And we are really thrilled with our current relationship with the federal government on that. But I don't want to be completely dismissive, but the last government, the Trump Administration, actually, we worked very closely with some of their agencies, like our relationship with the forest service is very strong. 47% of California is federally owned land.
And most of that is forest. So there's a lot of federal forest land. We really need to partner with them on forest management. And that's something we were able to do in the last administration. So it matters a lot from a budget perspective, we find in general that when it comes to actual implementation of policy, the people who are below the political levels, you know, are professionals, [laughs] so in DC. And so, you know, we get stuff done. Everyone's just plugging along, getting stuff done. And then when it comes to the big picture stuff, the big announcements or, you know, moments of crisis, it's really important who's in charge, politically.
Jason Jacobs: When you think about what the federal government could do to accelerate the clean energy transition, what do you hope to see out of the Biden Administration in say the first a hundred days? And then what do you hope to see out of them, say over four years, or maybe even longer, are there things that we could be doing as a federal government that ensure that the hard work that happens over the next several years will carry over from administration to administration?
Kate Gordon: Yeah. I think there really are. First, you know, everybody's laser focused on recovery right now. That is the number one focus of everybody, right? I mean, vaccines and then recovery, right. And economic recovery has to integrate climate risk. And by climate risk, I really mean the fiscal risk and economic risk from ignoring physical climate impacts. Like you can't ignore all the science on the fires, on the floods, like wherever you are. But also you can't ignore the risk of, of not being ahead of a transition. Like if we don't plan an economy, if we don't plan during our recovery an economy that is going toward carbon neutrality, going toward net zero, we're going to fall behind because the global policy environment, the global climate is going in that direction. So incorporating not just sort of saying as we did in the Recovery Act, and I think the Recovery Act was amazing in a lot of ways.
But what we did in the Recovery Act was really to say, "Let's make sure a chunk of the money is spent on green jobs and green industries." This time, I think where the Biden Administration is going, and it's really important. 'Cause it mainstreams this issue is to say everything we do has to be done through the lens of a shift to carbon neutrality, a shift to net zero. And the recognition that physical climate impacts are like a part of our world right now. We had more than $10 billion climate disasters last year in the United States. We in California spent a billion dollars on firefighting alone last year. So this is not going away. We have to pay attention to it. We have to, like if we're building out infrastructure with the Recovery Act, we got to do it in a way that's resilient and low carbon.
So I really liked that the federal government is incorporating that into planning and into operations. It's very hard to unravel that even with a new administration, like if you get that kind of approach through your budget process, through your procurement process, through how you do contracting, through how you do, you know, relationships across your agencies, that becomes part of your ecosystem, it becomes part of your culture. And it's very hard to unravel that. I will say it would be like ignoring globalization and you're doing economic planning. You just wouldn't do that. It doesn't really matter political party you're from. Globalization's a reality. You're not going to ignore it. So I think that's really important. I also think that just the spending itself creates, especially infrastructure spending, creates such an important foundation for everything else we do.
There is no company in this country that doesn't depend on underlying infrastructure. The education system, the transportation system, the system of healthcare, the system of housing. It's what we all depend on to keep the economy running, at the private sector and innovation level. So building out that infrastructure in a way that is more climate friendly is super, super important. And it'll last for years, these are like multidecadal investments that we're making right now. So I'm excited about that.
Jason Jacobs: And to get tactical for a moment, so if you put aside federal versus state, or this administration versus that, and you just look at this problem and you look at where we are with our footprint as a country, and you look at the different levers that we have to pull, what do you think is the most, or maybe a handful of the most impactful initiatives that could be put in place to accelerate our progress, for- forgetting for a second about where they live?
Kate Gordon: Yeah. It's a great question. It's [laughs] I have to think about where to attack that question, 'cause there's like a technology answer and then there's like a policy answer.
Jason Jacobs: Yeah. I mean, if you want to do it that way and say [laughs] on the technology side X, on the policy side Y, that, that works.
Kate Gordon: Yeah. And the technology side, this is like not rocket science really, but on the technology side, I mean, batteries, batteries, batteries so important. We can't reach any of our goals around grid resilience, electrification. Everybody wants to do full, you know, we just did an executive order, right? I mean, electrification of the vehicle fleet, electrification of buildings, adding that much demand to our electricity grid, you have to actually really pay attention to the energy going into your electricity grid. We've got to pull scale up. We've got to make renewables storable over a long periods of time. We've gotta get that to be affordable. And we've got to be really good on demand response. So how do we actually really advance the technology around individual homes, appliances, cars, and you know, being part of that system, right? Like feeding back into the grid or only working at, at times when you have peak renewables.
So that whole grid system, huge, we just literally cannot reach our goals without it. If you think of electrification is like number one thing you have to do to decarbonize these, electrify as much as you can. Number two thing, is use as much renewable energy as you can. And number three, is be as efficient as you can. Those three things are basically the grid. So I would put that one, two and three. Also in the technology side, I said something about it before, but I really, we have to figure out carbon removal. We have to be getting carbon out of the atmosphere now, even as we're looking at aggressive solutions for the future. The thing about climate change is that it's constantly advancing because every day we're constantly new emissions into the atmosphere. And that goes up and down with policy, with politics, with all kinds of things. We've got to figure out ways to be pulling out that carbon and stabilizing, even while we're looking at aggressive policy. So I would put that up there with technology.
There's a lot of other things actually. I mean, electrification, de-carbonization of hard to decarbonize sectors. So when people say that they usually mean airplanes, boats, steel production, cement production, as we're looking globally, so many places are growing and populations are growing and they're urbanizing. The steel and cement demand is unbelievable, and we haven't figured out how to decarbonize those industries. So that is super interesting from like a technology advancement perspective. So lots of cool stuff. I mean, and you know, and I guess finally again on technology, technology to make us more resilient, I mean water reclamation, right? We have these climate impacts that are actually making water availability really insecure, so how do you reclaim water? How do you dissociation? Like how do you think about ways to have a more secure water supply? That's going to be one of the base issues of this century.
So lots and lots and lots of things, but those are the bunch that are top of mind. And the policy stuff that goes along with that. What can we do as a government to incentivize that stuff, to prioritize it, to partner, to de-risk, to work with the private sector, to bring more value to those types of industries? How do we work with countries that are developing countries? How do we think about the relationship between developed and developing countries on technology advancement and technology deployment? I think that's the most important thing, because otherwise we're setting goals and we're not implementing and we're not achieving.
Jason Jacobs: So bringing that back around to the state of California, so if you have things like net zero by 2045 and carbon neutral by 2045 and you know, big, aggressive net zero vehicle goals by I think 2035 and things like that. And then I just wrote down everything you mentioned in terms of the key punch list of things collectively that we need to address. How does that actually manifest from a tactical standpoint? What can we expect from the state of California in the weeks, months, years to come to the extent that you know, and or can telegraph in any way?
Kate Gordon: Yeah, it's a great question. I mean, I will say caveat, the way California's budget process works is that the governor does a draft budget or proposed budget in January, and then there's a giant negotiation and then the revision comes out in May. So we're in the middle of the giant negotiations. So what will actually come out at the end of that process is up to the legislature and the administration working together on, on a path forward. But given that, or despite that I would say, yeah, we're working on all those things. So just in the areas I just talked about. So let's take vehicles, right, we have this really aggressive goal now, which the governor has put an executive order last year, as you said, uh, no more combustion engine passenger vehicles sold by 2035. Part of what we do as a government is to say stuff like that, because what that does is send a signal to the market of what California, like planning ahead to 2035, what is the California vehicle market gonna look like? That's really important to the vehicle industry because we have 26 million cars, right? I mean, we're huge. We have a lot of vehicles.
So the signal is really important, but then going beyond the signal, what policies do we create to make that easier, right? So what are we doing to, and this gets manifested in, for instance, a big proposal in the governor's budget on zero emission vehicle infrastructure. So really supporting build out of that infrastructure all over the States so that there's less anxiety, less range anxiety, but also there's just an underlying infrastructure for all those vehicles that are going to be coming in because we sent the signal. So that's really important. The thing I talked about before, also in the budget support to low-income Californians to get rid of smog, cars that can't pass smog. So we have cars on the road in California that are, you know, 20, 30 years old. Being able to turn in one of those vehicles, get a voucher for turning it in and another one for getting into a plug-in electric or a fully electric vehicle, that's a huge deal. And that actually helps support more access to electric vehicles.
You know, while we're seeing the secondary market expand, all these people who have bought new EVs in the last five years or now the lease is over, they're going on the secondary market, how do we get those into the hands of people who haven't been able to afford new ones? So all those are little pieces of the puzzle. And then finally the catalyst fund, which I talked about before, which is a way to use our infrastructure bank to basically provide low interest loans, no interest loans, loan guarantees to projects, to more innovative projects happening around the state that are, you know, not venture projects, like not super, super, super high risk, because we could never do that with taxpayer money, but really are like they're commercialized, but they're having a hard time with private equity, for whatever reason. They seem too risky because they're in a part of the state that hasn't traditionally done [inaudible 00:43:40] mission vehicle stuff.
In Kern County in California, which is where a lot of oil is produced, it's very hard to get financing, to build out charging infrastructure for EVs because people don't think that people will want EVs, and so the private sector won't fund it. So that kind of thing. So we're basically kind of working on all levels to say, okay, we set up this big audacious goal. It sends a really important signal, how do we actually work back through where the tricky points, like where are the barriers to getting that done? And then we try to address those barriers.
Jason Jacobs: And then, I, I wanted to also just flag. So one area you mentioned is that we're going to need carbon removal in any scenario. And I'm curious, so I'm asking this both specific to carbon removal, but also to any other hard thing we need to decarbonize, which might fit this criteria. And that is, can we ever get there in a world where there isn't a tax to make up the difference for the math not working? And I would ask that for carbon removal, but also for a lot of things and like some of these hard to decarbonize sectors, I would ask that same question.
Kate Gordon: Yeah, it's a, it's a great question. It's a really important question. I worked, before I came into state government, on a project called the risky business project, which was co-chaired by Hank Paulson, and Tom Stier, and Mike Bloomberg, and with a number of kind of economic luminary people and CEOs, and very bipartisan, very different perspectives. And they came to the ultimate conclusion that you cannot do this without [laughs] a price on carbon. I think many people have come to that conclusion in many processes over the years. What the price on carbon looks like is the big question mark. And in California, we happen to have chosen in 2006, a cap and trade systems. So we have a market based system where essentially you, you have tradable permits, right, to emit with a cap that steadily decreases. So it's not like you can just keep admitting forever and just buy your way out of it, you actually have to emit less and less, less over time, but you have some flexibility in terms of tradable permits.
So if you're a concrete maker, for instance, you can buy some permits to keep doing your business because it's hard to decarbonize. So we effectively have a price in California. The fact that we have a price is really important to us because the money that we make as a state from that price, from this permit sales is what funds just about every program I just talked about. So if you don't have that kind of dedicated source of funding that's outside of your general fund, politics are going to kill you every time, because there's always going to be a priority that people are yelling about that's a higher priority than the longterm effects of climate change. It's just a reality. So that dedicated fund, I think is super important.
I also think to your earlier point about removal, you have to have a value. We don't have this yet, but we're looking at it. You have to be able to ultimately put a value on a removed ton of carbon. In California, we have a value on a non admitted ton of carbon, right? You get a permit if you don't admit. We don't have a value attached yet to a carbon that you've removed, and that's something that our Air Resources Board is looking at actually for the next scoping plan, the next big plan for how to accomplish our climate goals. But everybody essentially says that that's necessary, right? 'Cause it, to your point until you have that kind of value, how the hell are you going to get paid for removing carbon from the atmosphere? It can't be a government project, it's gotta be a private sector technology project, it's gotta have value. So that's something we're talking about a lot and I think a lot of people are talking about, particularly in Europe and we're all trying to figure it out. It's probably the big policy question of the moment.
Jason Jacobs: And I have one final topic area I'd love to cover. And if you can't talk about it to say, shut up Jason or something like that. But if I look at our current political climate and I look at the partisan nature of the discourse, and I hear some calls for unification in terms of a focus on unity to unite the country and that's the best path forward. And then I hear some other calls that if we want to make progress, we've got to do what's right. And so if there's one side that's kind of, you know, off the reservation, whichever side you think that you need to kind of dig your heels in and fight and you need to kind of outclaw them and outvote them and things like that. What's your view, and I guess also, I mean, maybe it might be the same view in the state versus at the federal level or, or it might be a different view, but how do you think about as a country, the best path forward and where unification fits in, in terms of maximizing our progress on climate change and just other important issues that we need to do to look out for all of our citizens?
Kate Gordon: It's an important question. It's a hard question. I kind of think people will say California is so different because we're a democratic majority state by lot, with a majority legislature and a Democratic governor. There are still factions, even within a single party, I will say, so there's still negotiation that needs to happen. But then the country as a whole has a much more intense version of something we actually also have in California, which is a big rural-urban split in particular on politics. Really don't want to be Pollyanna-ish about this, 'cause I'm not at all. I think we're in a very difficult political moment and it's really ugly. And I, you know, it's uglier than I ever thought it would be. But I will say my direct experience has been that you can work with a lot of different people if you're talking about things that they... Are bottom line for them.
Like I was, I was an organizer between college and law school. And one of the things I learned as an organizer, as a tenant organizer, is start where people are like, you can't come into a room of tenants and be like, "I don't really care what you guys are worrying about right now. Like let's all focus together on this policy or like this initiative." You have to start with, where are people worried? What do they want to see happen? What would make a difference to them? And then build from that up to support for, and, you know, building allies for a policy or for a program or for direction. And I just think that's true of everybody. Like my, my experience with the risky business project, which was a very bipartisan and I spent a lot of time talking to people all over the country, the project where I was interviewed by Hog Farmer Daily, like it was that kind of project, right?
My experiences with that project was that every single person in the country is at this point experiencing climate change in terms of the direct impacts on their lives. You don't have any snow mass, you don't have water. You have extreme heat and you have health impacts from that. You're inside cause a wildfire smoke, so you've asthma. Your crops are not yielding as much because of increased heat summer to summer. You have inland flooding and inland drought, so the Mississippi river doesn't, you know, isn't allowing for barge traffic. Whatever the thing is, pretty much everybody has, you know, hurricanes. And if you start with that lived experience and then go from there into the larger conversation about climate change and solutions, maybe you start with solutions on adaptation and then you go into longer-term solutions on bringing down emissions. It's just a different conversation. You go from starting with denial to starting with a discussion about lived experience.
I just think in general, walking into a room with someone and telling them that what's happening is their fault is never a good way to start a conversation. So I'm really, really a fan of at least trying to find those shared experiences, because this is... Climate change is a massive macroeconomic issue that affects absolutely everybody. And if we can find those shared experiences, maybe we can find some shared solutions or at least the ability to talk about it. Ultimately, not everything's going to be a negotiation, that's a consensus. Like there's gonna be things that are regulatory that some people are not going to like, because you got to do them. Sometimes you have to. Government's job is to like deal with things that are market failures. Sometimes you've got to, to move forward with the policy. But I really, really, really hope we can get to a place where we're sharing experiences and we're listening to each other and really having those one-on-one discussions. And that is a whole lot harder with COVID in a remote environment. But I still, I really hope we can get there.
Jason Jacobs: And my last question is just that a lot of people who listen to this show are trying to figure out how to reorient their professional lives around addressing this problem more directly. Some of them might be founders who started and sold companies. Some of them might be investors, but some of them might be undergraduates who have degrees that are a feeder into the oil and gas industry for example, who just don't feel comfortable going anymore and want to do something more purposeful. Or they might be mid career changers, who, you know, who might be an attorney at a big firm, or who might be an accountant, or work in financial services and just want to put it front and center because it's too important. Speak to them for a minute. And I know that's a wide range of backgrounds and perspectives, but what advice do you have for those people who maybe haven't been working on it for as long as you have, and aren't steeped in it and don't do it as part of their day-to-day, but feel guilty about that and feel a duty to make a change.
Kate Gordon: I think that everybody can work on this issue from wherever they are pretty much. I really think of this in terms of, you know, what do you bring to the table? You bring your lived experience, you bring your expertise, you bring your, you know, whether that expertise is in technology, or is in starting a company, or is in finance, or is in frankly geology, or even oil and gas, you know, market analysis. Every one of those things is critically important in the world of how we do this giant economy-wide global transition. You're working in financial services, there is an enormous and growing field of environment social governance investing, of climate risk disclosure, of looking at aligned investments across all kinds of different investment classes. So I think that's super exciting. I think finance is actually one of the most exciting places to be actually in climate right now.
You're working, as you said, there are a lot of people graduating with degrees that are like feeders in the oil and gas. I think it's really, we're thinking about the future of the oil and gas industry. There are oil and gas companies that are actually actively diversifying and actively thinking about how to move their RnD money into carbon removal, for instance, which also requires geologic expertise. Think about that, like make choices based on who is moving in that direction and who's not? I think lawyers, there's a million things that lawyers can do. I mean, the law of carbon markets is a hugely interesting field. So it was of course regulatory law, but not everything's about regulatory law. There's all kinds of interesting finance people are thinking about corporate structure and you know, how do you align corporate structure with social policies? Like you've become a B Corp, is that the right thing to do or are there other options from that? Like how do you start to align toward what Larry Fink from BlackRock has told us everybody should do, right? Aligning toward long-term investment and long-term social good.
So I think there's an answer for everybody. I just would say like, you don't need to reorient your entire career and suddenly become like an environmental scientist, or suddenly become like a regulator, or suddenly become an environmental lawyer. I actually think it's even more valuable to take the skills that you have and apply them to this world because it's literally going to be everything. And so we need it to be an all, you know, just like it's an all of government approach in the Biden ministration, it needs to be all of society approach. So I'm excited for people to come in from all kinds of different backgrounds and, and take this on because we need all hands on deck at this point.
Jason Jacobs: Well, we've covered such a wide range of topics. Is there anything I didn't ask you that I should have, or any parting words for listeners?
Kate Gordon: There are so many things to say, Jason, but that was great. I think, you know, covered a lot of things and really good questions. So I really appreciate it.
Jason Jacobs: Awesome. Well, I'm so glad we made this happen. And Kate, I know how busy you are, thank you so much for making the time to come on the show.
Kate Gordon: Thanks Jason. Appreciate it.
Jason Jacobs: Hey everyone, Jason here. Thanks again for joining me on My Climate Journey. If you'd like to learn more about the journey, you can visit us at myclimatejourney.co. Note that is .co not .com. Someday we'll get to .com, but right now .co. You can also find me on Twitter at JJacobs22, where I would encourage you to share your feedback on the episode or suggestions for future guests you'd like to hear. And before I let you go, if you enjoyed the show, please share an episode with a friend or consider leaving a review on iTunes. The lawyers made me say that. Thank you.