Using more of the grid we’ve already built

[Music] Hello and greetings everyone! This is Voltz for April 1st, 2026. Using more of the grid we've already built. I'm your host, David Roberts. The US power grid is built and operated around a simple principle. As long as they're willing to pay for it, anybody who wants power gets as much as they want when they want. Unlike highways or broadband lines where traffic congestion occasionally slows you down, you get your electrons the second you plug in. Because it must accommodate anyone at any time, it must be built big enough to reliably meet the heaviest demands that might conceivably be placed on it. It must be built for its worst day. An August afternoon with a hundred plus degree temperatures, everyone running their AC and charging their EVs at the same time. While the benefits of this kind of system are pretty obvious, it's quite useful and conducive to economic growth to have effectively unlimited power at your fingertips whenever you want. But it has significant downside. If you build the grid big enough to smoothly meet the demands of its worst day, most of that grid, most of the power plants and transformers and substations and wires will be grossly underutilized most of the time. Most days aren't worst days. Across the whole country, on average, we are now using about half the grid's capacity. That is low relative to the last 50 years. And now utilities are looking at a surge in new demand from data centers and saying we need to build more, more power plants and transformers and substations and wires. All of this will be expensive, all of it will be slow to build, and all of it will eventually show up on power bills, which is a big part of why the average Americans' electricity costs have risen about 25% in the last six years, even as the cost of actually generating power has fallen, thanks to renewables. It is the infrastructure. What if instead of always building more, or at least before building more, we tried to use what we've already built a little more efficiently? My guest today, Ian McGruder, heads the Utilize Coalition, a new industry-backed consortium, including Google, Tesla, and many other big names, making just that case. We're going to talk about what boosting grid utilization actually means in practice and what it implies for electricity bills, the clean energy transition, and U.S. politics. [Music] With no further ado, Ian McGruder, welcome to Vultz. Thank you so much for coming. Thanks for having me, David. I'm excited to be here. Ian, I'm so excited about this, and I thought, as I was sitting thinking about how to introduce all this, I was thinking of saying something to the audience along the lines of, you know, I know this sounds super, super technical and nerdy, but it's really actually crucially important. But then I realized I say some version of that before every single one of my parts. Almost every pod, yeah. Flirting with self-parity, but so I'll just say this is complicated, but I really think this is a super, super important, super timely debate to be having a discussion of you having right now. This hits all the hot issues in the power world, in the energy world right now, so people should just focus up. Yeah, I think we have a chance to make grid utilization sexy or at least interesting in this moment. And so for those who are skeptical in the beginning here, I hope we'll have gotten them juiced and excited by the end of this. Yeah, hang out. The word utilization, really, is just so unfortunate, but there it is. All right, so what do we mean when we are talking about grid utilization? I think when I say that the grid utilization is at 50%, some people might imagine like a big power line, like 50% of the time it has power running through it, and 50% of the time it doesn't, but that's not quite right. Like to help us understand what we mean when we're talking about utilization. Sure. So I think many of your listeners may be familiar, but we broadly think about the grid in sort of three sections. Right, you have generation, how we make our power, transmission, how we distribute across long distances, high voltage, and then distribution, how we bring it to our homes, businesses, so the last mile, so to speak. And the way we think about grid utilization is holistically. So there's different ways of measuring this, but we think of it as the total throughput on the grid, and this report that we have just released from Brattle, that I think we're hopefully going to get to, outlines one way of measuring that, which is pretty straightforward. Which is just to lay it out plainly, the total throughput that the grid is capable of, divided by the electrons actually running through it. Like how much power is actually running through it relative to how much power it's capable of putting through. Exactly. Yeah. So they define system utilization as a percent as the total energy delivered or produced over available system capacity over the same time period. And I think what's important here, you know, the number as a whole is important, right? The percentage. But it's also important to think about this at a granular level, because in any given geography, you're going to have parts of the grid that are more utilized and less utilized. Right. And that's where you have really interesting opportunities for efficiencies. Right, right. This is not evenly smeared. Utilization varies dramatically across geographies. It's 50% on average across the country. Exactly. And the simple way to think about this, you know, that we talk about is just to make it more real for people as an analogy. And this ties into the affordability piece is to think of an airplane. If we build an expensive airplane or fleet of airplanes and we're flying them with half the passengers on any given day, those tickets are going to be expensive. And if you can fill more of those seats, the prices will come down. Right. And let's spell it out why they're expensive, because in addition to paying for your seat when you buy a seat on an airplane, you are also paying some small percentage of the fixed costs required to keep that plane running. So if you sell more tickets, more people are splitting up those fixed costs of keeping the plane running. So the more passengers you cram in, the lower the per passenger price. Exactly. And before someone, you know, I'm sure we'll have a distribution engineer listening to this or someone who may have an issue with the, it is a slightly oversimplified analogy, of course. Ian, I ran through so. I honestly ran through so many analogies when I was thinking about this for my intro. I ended up abandoning and not using any analogy, because they're all not quite right. Another one I think is kind of vivid for people is like, what if you built highways on the principle that no one should ever have to slow down at all? Right. So then you're like, well, what's the maximum number of people who are ever going to be on this highway, rush hour, bad weather, you know, busy time of year, whatever. Let's build a highway. Why did enough to accommodate all those people so that they don't have to slow down? Yeah. And then I think people would intuitively see the vast majority of the time. There wouldn't be nearly that many cars. And then all the cars that were on that road would be paying for all that extra asphalt to maintain all that extra asphalt. That is also another analogy. There are like 10, but there's a plumbing analogy we could use. Yeah, yeah. There's so many different ones. I mean, does it finish the plain one though? You know, you could fill a plane. You could fill every seat safely and fly it. You know, the grid is different. You want a little bit of flexibility. You're not going to, our goal is not 100% utilization here. But I think the important thing to understand is that our grid in America is underutilized. There is extra capacity sitting there. And in our view, there's no state in America that is sort of perfectly utilized. It's grid or optimized it. And so there's opportunity everywhere. And we can have debates about, okay, how far can you push it, et cetera. We're going to have technical working groups thinking through these things, et cetera. But there's opportunity now and everywhere. And so let's work on that in the media term. So 50% is low. Low by historical standards. Low relative to even like 20, 40, 50 years ago. Yeah. But at no point is it ever 100, right? So the right level is going to depend on a lot of things. But I think it's safe to say almost every grid has some spare capacity. And I think we can also say categorically. And this is kind of the whole point of your effort that any effort to exploit and make use of already existing capacity is almost by definition going to be cheaper than building new capacity. I think you can say that categorically. That's right. Exactly. And I think that's a really, really important point because we've historically built our grid to peak. And our view that is not some grand conspiracy. It's just how we had to do it. To your point in the intro. We have to ensure that when someone flips the lights on, they're going to come on. And even in the hottest summer day and the coldest winter morning or night. And we didn't have the technology that we do now to enable a more flexible grid. But we have that technology now. And so I think our policies and the way we plan the grid haven't fully caught up with the capabilities we have now to get more out of the grid we have. Is there a simple explanation for why grid utilization has been falling on average for, I don't know, like 40 or 50 years now, like what is there a simple explanation for why the grid is currently so underutilized? Yeah, I hesitate to weigh in on the exact reasons. I think there are probably other guests you could bring on grid anthropologists who may have stronger opinions on this. I think with our campaign, we're a little less focused on the why of the past and more on the, okay, what do we do about this now and how do we meet the moment? All right, so greater utilization has many benefits, which we're going to get into. But I'm sort of curious to start with a comms question, a PR question, which is, you know, you could pitch this as, hey, we have a plan for getting data centers online faster or you could pitch this. Hey, we have a plan to put some downward pressure on rate payer bills. Or you could say, hey, we have a plan to accelerate the clean energy transition and reduce greenhouse gases. All of those would be to some extent true. What are you leading with? What is the, what do you think is the most powerful message and like, what is the headline message? I love this question because it's one that we've thought about a fair bit. We're focused on affordability. We think that's, you and everybody else. Yeah, that's, and people are by the way throwing the word affordability around a lot and sort of slapping it around their favorite pet project from the last, you know, decade or more. But this is really something that is designed at its core to drive affordability. And this Brattle Study shows that a 10% increase in grid utilization could drive over $100 billion in savings for Americans over the course of the next decade. So that's, it's very significant. This is not a playing on the emergence thing of affordability. Right. I want to, I want to return to the question of scale later because it is something that slightly vexed me. Yeah, but to get to your point on messaging, there are lots of different reasons why people may care about utilization. And I think one of the things that's exciting with this campaign is that we can welcome them all to the table. In other words, if you're someone who believes that, you know, America needs to win the AI world with China, and we want to bring new domestic manufacturing to our shores, then utilization is your issue. If you're someone who believes that we need to electrify everything and we need more power for that utilization is also your issue. There are people across the political spectrum who, for different reasons, care about this and are talking about it, Republican governors, Democratic governors. And so I think we have an opportunity here to do something that I've described as cross-partisan. And I'm intentionally saying that rather than bipartisan, which is to reach people in different states. And the reason I say cross-partisan is, you know, in this country now we live in such a polarized world. When I think of bipartisanship, I think of the classic, you know, the senior senator meeting in the middle of one party and a senior senator another and you kind of hash out some compromised solution that sort of. And that may be the case in certain places, but if we run this bill in a state to prioritize grid utilization and it's a Republican governor, Republican legislature, you may not need a single Democratic vote to get that done. Or you run into the Democratic state, the Democratic governor, you may not need a single Republican vote to get it done. So it doesn't need to be bipartisan, per se. It does need to be cross-partisan. And it needs to be something that people from different persuasions, backgrounds, and interests can see themselves as a part of. And I think affordability is the thing that connects that. So our, you know, tagline, if you go to our website, it says America needs more power more affordably. And I think most people, policymakers in the public would acknowledge that we're going to need a lot more electricity in this country in the coming years for all sorts of reasons. And so I'm a little less concerned with what all those reasons are and more about, okay, given that we need more power. How can we do this in a way that's going to not break the bank? I'm going to return a little bit to the coalition politics later because they are really interesting. And I want to discuss like, who's against this? Sure. And why? But first let's talk about just, so the grid is currently underutilized. And the basic affordability argument is the same as the airplane. You get more passengers in the airplane. You're splitting the fixed costs over a larger group of people. Same exact thing on the grid. The more you utilize the grid, you're more, you're sharing the fixed costs of maintaining the grid across a wider group of people. That's the affordability argument. So what are the mechanisms whereby we can boost grid utilization? How do we use more of the grid more of the time? I mean, I guess the way to frame this, I think, is, and we mentioned this in the intro is the size of the grid is pegged to the size of the peak of the highest peak, right? That is the size of the grid. So when you're thinking about how to use more grid, you're mostly thinking about reducing peaks, I imagine. Like most of the policies are going to circle around that, but I'll just throw it open to you. So what are the mechanisms for increasing utilization? So there's a wide range of things that can increase grid utilization, everything from distributed resources, demand response, grid enhancing technologies, advanced conductor, large load flexibility, et cetera. But let me just walk through a few examples from some of the organizations that are coming together to support this effort. As a preface, there are policies I can imagine increasing utilization on distribution grids, and then there are policies I can imagine increasing utilization of long distance transmission, like the aforementioned grid enhancing technologies. From what I can tell from your literature, the coalition is mostly focused on the distribution side on DERs, VPPs, that kind of thing. Although you do mention transmission, and you do mention reconducting and grid enhancing technologies in the literature. So I'm just sort of curious, like on the distribution versus transmission thing, are you, is the coalition attacking both sides of that? Yeah, we're looking at this holistically. So like I said in the beginning, distribution, transmission, generation, we want to look at this sort of the whole picture. And you're right, there are certain technologies that can help with certain parts of it. So I want to want to under over index on the folks that are supporting the effort because we're really taking a tech neutral approach. Instead of trying to, and this actually gets into the policy strategy, instead of trying to mandate a specific technology, we think that a smarter way to do this is to really prioritize grid utilization is a metric and sort of a guiding principle and then let the best lowest cost technologies win the day. Okay, well, get to policy. But first I want to help people understand when we say DERs, you know, people are familiar with these just EVs, EV chargers, solar panels, home batteries, all we talk about all the time on, on volts. Just say a little bit about why using those distributed resources increases utilization, just spill it out a little bit for people so they understand the connection. So let me just walk through a handful of examples from the various companies that are involved in this effort just to help illustrate I think some of the technologies that can help with this. So Google, they're building data centers, they just announced a gigawatt of flexibility that they have enabled on the grid and they're committed to flexibility through different mechanisms, right? They're putting batteries on site at their data centers. They are finding new ways to move compute around so that you can actually ramp up and down data centers within certain limits. It's not possible everywhere. But Tyler Norris, who's now at Google wrote this seminal study while he was at Duke that I think a lot of people read and got a little lot of buzz, which essentially said that if we can limit the usage of these data centers just a few hours a year essentially, you can bring them online so much faster without meaningful upgrades that are expensive and time consuming. And I should say the day we're recording this, which is Wednesday, March 25th, I released today a podcast with Jesse Jenkins and Astrid Atkinson specifically about data center flexibility running in some detail through all these options having a little on site, power of your own, having some flexibility in your compute and then having flexibility on the utility side, right, flexible interconnection arrangement. So that's all kind of on the, I guess what you'd say the transmission into things. Right. So that's one example exactly. And just to sort of further illustrate this point, you know, Google recently announced this new data center in Minnesota. And part of what they're doing with that is with form energy, the largest battery deployment in the world. Long duration. Long duration. Exactly. But the other thing they're doing that that I think wasn't picked up quite as much as they're also putting 50 million dollars towards distributed batteries in the community in Minnesota. Yes, as I've been, you know, as I've been preaching and preaching for for over a year now, they are buying distributed capacity. Exactly. which means household. level capacity. Right. And what they're doing with that program through Spark Fund in this distributed capacity procurement is literally putting batteries in the community. So it's actually front of meter batteries, not necessarily in homes in this case, but in church parking lots. And you know, you could imagine batteries behind a Walmart or wherever in your community about the size of a shipping container. So these are not a giant field of utility scale batteries the way that you know, California and Texas are doing it. It's that under exploited middle right. It's not residential. It's not utility scale. It's kind of like whatever you're 20 megawatt kind of like front of the meter community scale. I guess I don't know if we have a technical term for it. Exactly. And that is a really interesting and exciting model because it also creates some resiliency in the community, right? You're having having batteries spread out as opposed to just located in one. And it gets to this question you had around. So how do you enhance utilization? There are instances where instead of upgrading an entire distribution circuit, you can plop a battery somewhere and manage it more dynamically. And so that may be more cost effective. A few other examples. Renew home has the ungodly number of Nest thermostats that they manage. We had them on too. I think they run a big VPP mostly composed of thermostats. Exactly. And those are the kinds of things you can preheat or pre-cool your home depending on you know, when the grid needs that power. And a lot of places they have you know, gigawatts of capacity actually across the country now that is just waiting to be turned on, right? If we have the right incentives in place, span has I think you've brought them on your pod as well. Smart electrical panels that can dynamically manage the appliances in your home and ensure that you're using less power when the grid electricity is more expensive and the grid needs it. And and you shouldn't have to manage this yourself. It can happen in the background. Carrier is now putting batteries in heat pumps. Yeah. And they're putting them in air conditioners. Air conditioners. Exactly. Air conditioners and heat pumps are going to be battery enabled. I'm going to do a pod on that for sure. Air conditioners especially are just like ubiquitous. They're everywhere like if carrier put a battery in every AC at sold, that is like overnight the biggest VPP on the planet. Absolutely. And if you imagine, you know, the hottest summer day, right, which is when peak demand typically occurs in most parts of the country or the coldest winter morning. And I either case, it's heating and cooling that tends to drive that peak. And so if you think about if every HVAC unit in America one day was battery enabled, there's hundreds of gigawatts of capacity. That we could enable. And I think that's such a big deal. You know, and a final example on this varices building data centers that are totally flexible battery enabled, you know, low water usage, etc, etc. So there's multiple solutions here that can help drive affordability and better grid utilization. And our approach is instead of picking any one of those, although I'm clearly very excited about all of them. And there's many more we could mention, right, advanced conducting and dynamic line rating. And we think about grid enhancing technologies, right? There's so many things we have now. And I think another important point is that the technology has come a lot further. So, you know, we've been discussing in this country, non-wires alternatives, etc. for a decade. Yeah, and like demand response, all this stuff is very old. And if you talk to the companies, they get frustrated because they felt like they've been so many cases stuck in pilot purgatory. And their technology is proven now. We don't need to keep piloting it. It's ready for scale. Yes, as jigger shahs find a pointing out, they've been using this stuff in normal operations in Europe for years now. Like, they're well beyond the pilots. Exactly. And now we have an opportunity and a need to scale it up. And so the question is, you know, from a policy standpoint, you know, there's different ways of accomplishing this. One thing that has been tried in many states is the equivalent of, you know, an 80 plus page VPP mandate bill, which may be well intentioned, but utilities tend to hate regulators or skeptical of. And we think in general has not been the most successful policy approach. And so our policy approach is to say, what if instead of mandating anyone given technology, we set utilization as the North Star, let the best lowest cost solutions win, and not set up more individual pilot programs, but really incentivize this at scale and let us really bring these resources to bear. You discuss a wide variety of solutions and there are a wide variety transmission versus distribution like household versus front of the meter. There's a million different ways of increasing utilization, but in the end, you know, I'm going to ask this question, isn't it mostly just putting batteries everywhere? I think that's a big part of it. Aren't all grid problems in the end, don't you just need to put batteries everywhere? I think that is definitely a big part of it. They are a piece of every solution you mentioned, you know, you might have noticed like every individual solution, the little battery hiding in it. Yeah. And, you know, some people are starting to talk about batteries is like the next chale boom, right? That this is, this is something that whose time has come, you know, the price of batteries has fallen tremendously. And I think a lot of people haven't quite wrapped their heads around this. And so, you know, we're going to need batteries to your point everywhere, businesses, homes, front of meter behind the meter in your vehicles all over the place and batteries, thankfully, now that there's so much cheaper and still coming down in cost, have the potential to, I think, solve a lot of this. Yeah. One aspect of using your existing resources more like the Brattle Report actually raises this, if your existing resources are primarily fossil fuel based, then utilizing them more means running fossil fuel plants more often increasing the capacity factor of fossil fuel plants, which means more emissions. So there are some cases you can imagine where greater utilization would yield more greenhouse gases at least to begin with. So I would just wonder how you think about the relationship between utilization and decarbonization? From our perspective, the most juiced to squeeze is really on the distribution transmission side. So if you're looking at this system wide, I think that's where you're going to find the most savings and the most ability to increase utilization. But, you know, there may be instances where you end up running your existing generation fleet, whatever that may be at a higher utilization level, if you choose to manage it system wide. And I think there's a question given that we need more power if a certain state is, if you're looking at this through decarbonization lens, going to use an existing plant, let's say a gas plant, for instance, at higher utilization or build a whole new one, what's better? Yeah. Do you want more gas plants or you want to use the ones that you have a little bit more? Yeah, certainly better than building new fossil fuel plants. Right. For what it's worth, our campaign is not, we're not a climate group, we're not, you know, actually clean energy org. We're focused on affordability, capacity, speed to power. But if you want to look at it through that lens, I think most environmental groups would would much rather not build that additional fossil plant. Well, also, and just like the fossil plant is expensive and slow, like, we're, I think we forget it sometimes, but we are in kind of an enviable position in that all these problems that all the people with money want to solve, the clean stuff solves that faster and better and cheaper. So you don't even really need to talk about the cleanness of the clean stuff. It's just performs better. Right. So the thing the Brattle says is, if you, and this is all, we should say this about the Brattle study, like it is highly abstract. Any real world, you know, grid utilization scenarios going to be much, it's going to have a very, a lot of sort of idiosyncratic characteristics and, and et cetera. So this is just kind of directional, a directional study, I would say. But the Brattle study for models, it says 10% improvement in system utilization produces a 3.4% rate reduction. So that's not a small rate reduction. I think it's meaningful. What I kind of want to wrap my head around is how big of a deal is a 10% improvement in system utilization? Like what is, do we have any sense of how heavy a lift that is? And I guess it'll obviously vary from grid to grid. But like, is this the kind of thing where there are a few switches they could flip and boost it 10% tomorrow? Or is this like the work of years? And you know what I mean? I just want to wrap my head around how big of a task is those free utilities? Sure. And just to situate ourselves, the Brattle report we're talking about is called the untapped grid. You know, those who want to dig in and, and read the whole 40 pages can, it's linked in the show notes as they say. Fantastic. Dig into it. And I think we'll will enjoy it. You know, the 3.4% reduction in rates may seem like a small number, but to my earlier point extrapolated across a decade that can amount to over a hundred billion. They model out 110 to 170 billion dollars of savings. So it's not a small amount when you think about it kind of at the macro level, but that 10% increase in utilization is also very significant. So I think you'd have to get a modeler on to, you know, sort of quantify all the things that have to happen. But in, you know, an aggregate, we would have to meaningfully shift the way we manage the grid and the resources we're using. But it's achievable. I think, you know, a 10% increase is absolutely doable in this country. We could debate 20, 30, 40%, maybe that's less likely or realistic. But this is something that we can do as a nation. And individual states can act on it and the technology's here. Well, let me push you into an area that you might not be totally comfortable talking about, but I think it's important, which is the role of utilities. As I've been thinking about this, I've been thinking like, who could be against this? What I mean, like you spent billions of dollars building a bunch of infrastructure. Who's going to argue against using it more efficiently? Like why would be the basis for any such argument? And I was trying to think about it. Who's against this? Who politically? Like who are you fighting? And one thing that came to mind is, well, there are utilities, right? And what people come back to over and over again is something I've discussed on this pot a trillion times is the basic sort of financial incentives of utilities, right? They have these profit margins that they make from spending on infrastructure. So from a utilities, from an IOU's perspective, investor-owned utilities, they make more money if they spend more money. And if you are telling them, instead of spending more money, utilize what you've got more effectively, you are pretty directly telling them to make less money. And I notice that the Brad or Port and all your literature, you kind of dance around. You don't talk about utilities and utilities. And incentive structures vary directly. And I totally understand that since pretty much every member of your coalition has to work directly with utilities and you don't want to stick your thumb in their eye, but is not the incentive structure of investor-owned utilities part of the problem here. Hey there, everybody. Don't worry. I'm not going to tell you about a new mattress or push a credit card on you. This isn't an ad. There are no ads on volts. It is supported entirely by listeners like you. If you'll indulge me for a second, I'd like to ask for your support. I started volts because we're all surrounded by depressing news about climate change and misinformation about clean energy. And it's never been more important to share the stories of the real people on the ground doing the real work of transition and all the ingenuity, courage, and public spirit they are bringing to it. People are hungry to hear these stories, to learn from and find inspiration in them. I've heard from people who've changed majors or careers after hearing episodes of volts. People using it in classrooms and community groups, even state legislators who have passed bills inspired by specific episodes. Sharing these stories matters. It makes a difference. If you have found value in it and want to help me continue doing it, I hope you will join the community of paid subscribers at volts.wTF. It's about the cost of a cup of coffee a month. If you don't like subscriptions, you can make a one-time contribution, leave a review on Apple or Spotify or just tell a friend about volts. I am grateful for any and all support. If you're already a paid subscriber, thank you. Now, back to the show. Is not the incentive structure of investor-owned utilities part of the problem here? I'm so glad you asked about this because I'm very comfortable talking about it and I think it's a really important part of how we actually get this done. We've actually had some surprisingly productive conversations with utilities around this and I think there are a number of reasons for that. In many parts of the country where we are seeing rates increase, they know affordability is real and they want to do something about it. Their perspective is there are a lot of bad ideas being thrown around, whether that's an immediate freeze on all rates or. Did you see just today, Sanders and AOC came out with a bill for a national moratorium on new data center construction? There you go. I think we should get into that as well because new demand on the system, this is actually worth a quick aside. Yes, let's do this here because this is counterintuitive. Yeah. Anyone who's taken a high school or college e-con class thinks that any time demand goes up, prices in a supply-constrained environment, prices will never go up. That is the case with most markets. Electricity is different because we have paid for so much of the grid already. Do me, David, all of our listeners, anyone who's paid a utility bill has helped to pay for the grid. Now that we've paid all this and we have all this infrastructure, if we can sell more electrons over the grid we have or to your point about the airplane analogy, fill more seats for the airplane we've already paid for, then prices come down. So whether it's new, large load through data centers or manufacturing or electrification or whatever it may be, load does not. This is a key part of the Brattle Study as well. New load coming online can actually decrease electricity prices if we increase utilization. So that's the big decision we have as a country right now in this moment is we know there's new load coming online. How are we going to handle it? Right. And just to underscore this, it is not a mechanical reaction that if you add a data center, people are going to be paying more. It is possible that you could add a giant chunk of new demand and if that new demand serves to increase average utilization of the grid, you will lower average per unit costs on that grid. In other words, there are circumstances where adding a data center to your grid could lower your costs. That could happen. Exactly. That's not inevitable either, right? It's either effect is inevitable or mechanical, but we can make data centers work for us to increase utilization and thereby lower costs. That is a very important point. Exactly. And so coming back to your question around utilities and I think how we're in our early stages of having a lot of these conversations, but our grid is aging. We do need to make upgrades to the grid. We're not a group that's saying don't build any new generation or stop upgrading the grid. Those things are going to have to happen. Actually, can we have a decide about that too? There's a side portion of the pod. Just because I want to address that directly too, there is a sentiment. I think in some circles in DC, among I think kind of, I guess you would say the abundance coded bros, they want abundance. They want more and more and more. They say we need to grow, grow, grow. That's kind of their fixation. And so when environmental groups, green groups respond to them, hey, instead let's increase utilization, it sounds to them or I think they perceive it as a kind of backdoor de-growth strategy as a way of avoiding building more, as a way of avoiding expanding the grid, as a way of avoiding building, basically, because they think green groups are allergic to building. So I just want to, once again, I've made this point several times now, but just once again make the point that the utilization push is not that. You and your colleagues at Frickin Google and Tesla are not secret de-groters. You want a better, bigger, higher functioning, higher throughput grid, right? So I just want to, that's right. Here's that up, deploying more power walls and mega packs from Tesla and all the other technology we discussed earlier is not a de-growth strategy. We're going to need more infrastructure to help us take advantage of the infrastructure we have and use it better and lower costs. And even if we push utilization up, and again, we're not sure how high it can go, but even if we push it up to, you know, we're still with data centers plus electrifying all of the transportation sector, plus electrifying all of the heating and cooling sector. Like we're still going to need more, more, more. We're still going to need more generation, more lines. It's like, that's still going to happen. But it just makes economic sense to solidify and bolster what you have already, right? I mean, you don't want to build a giant edifice on a rickety foundation. Exactly. And this is where I think from the utility standpoint, you know, they know that we need to keep upgrading the grid in certain places. And if we don't get better at utilization and rates keep going up, they're going to have a hard time doing what they want to do. Yes, the alternative here is just build, build, build, which means higher, higher, higher, bills. And they know we know politicians know everybody knows right now. That's just not politically tenable. Like utilities are going to get burned at the stake if they respond to increasing demand purely through building more. Exactly. And we're coming in and saying, let's do this in a tech-doos-for-all way. Let's not tell you or mandate specific solutions. Let's set some metrics that we can all, you know, measure this by. And this is what this new legislation in Virginia, which I hope we have a second to talk about does is to incentivize grid utilization by measuring it for the first time, formally putting it in the planning process. Okay. I want to talk about that now. But first, I want to push just a little bit more on utilities. Sure. Perhaps it is true that utilities recognize that they can't politically just build, build, build. It's just not tenable. And so perhaps they have some incentive not to just build, build, build. Nonetheless, the basic incentive structure remains. Would you acknowledge that that basic incentive structure pushes in the opposite direction from what you're trying to do. Yes, I think that's a really important final point on the utilities question, is how can we make this make sense for them for an incentive standpoint as well? And there's different ways of achieving that. Some people want to blow up the entire utility regulatory compact. That is not our position. We actually think that even within the system we have today, which I think in our view has served us quite well for a long time, there are subtle changes we can make that would better incentivize utilities to move in this direction. And so we're having those conversations as a coalition. And one way of doing that is just saying, "Hey, utilization is X. Make it X plus 10." Within 10 years, right? I mean, if you want to give the utility an incentive. Sure. passing a law that says it has to do this would be a great incentive. That's right. And there's also shared savings models as one thing we're exploring or discussing. So you could imagine if a specific policy provides significant savings for end consumers. Yeah, Brattle pitches this. That utilities could make more money doing that. Perhaps. Right, depending on how you structure it. And I think those are things we have to take seriously, because I think this is how a lot of the companies have been thinking about this. Is that they're tired of sort of going to war with utilities, fighting over these things, slow deployments. Everybody's exhausted by that. I have to assume the utilities also, right? Yeah. Everybody sees what we need to do now, and we're all saddled with this sort of like these weird legacy regulatory structures. Exactly. So let's come up with some better incentives that make sense that are actually true win-wins for consumers for small and large load, right? And for utilities. And I think that we have an opportunity to do that. And let's talk about Virginia, because I don't know if you planned it this way, but it's quite handy to sort of launch your coalition on the back of a big victory. The Virginia bill is a big and explicit victory. Like utilization is not a footnote in some larger bill. There is a bill about utilization that passed when some other energy bills didn't in Virginia. So tell us about how you went about assembling a coalition for this in Virginia and who is in that coalition. So this story starts with the governor, because the newly elected governor of Virginia Abigail Spanberger decided to put this on her energy affordability agenda. Yeah, affordability is huge there. Virginia data centers, if any state in the union, this is where this is like a severe top line problem in Virginia. Exactly. And so a number of groups, you know, ourselves included, have been talking about gridulization trying to plant this idea. There's a brilliant woman named Molly Null, who actually helped write the first draft of this legislation before she was working with us and now she's helping our effort, which I'm deeply grateful for. And so the governor decided to propose this bill. And we were able to do something that I think is challenging and unique, which is we actually sat down with the utilities and the environmental groups and various stakeholders and got a little bit of their input and there was some back and forth. And it's a one page bill and anyone can read it. You can look at SV621 in Virginia, which passed through both the House and the Senate and received bipartisan support. And really what it does is two things, in essence, one, it for the first time requires utilities to provide gridulization metrics down to the substation and feeder level. And it, too, it allows these metrics to be used for the first time in the planning process. It actually rolls it into, you know, the IRP and the formal planning process and allows the commission and the utilities to find the best lowest cost solutions. It mentions a whole bunch of the solutions we've talked about here today as potential contributors towards improving gridulization, but doesn't require a mandate any of them. And we see this as a really important step in the right direction towards incentivizing utilization. I think the commission's excited about it. Question about this bill. When we talked a while back, months back about this all coming together, me and you and Pierre LaFarge discussed, you know, possible policy tools to do this. And one of the things we discussed was the equivalent of, like, I know Voltz listeners will be familiar with renewable portfolio standards, right? Like you tell the utilities in a state you have to increase the percentage of clean generation on your grid by X amount by X year. Very familiar policy. Most states have them at this point. What we discussed was basically the equivalent of an RPS, a utilization standard. Basically like grid utilization in your utility area is X, raised that by X percent by a certain year. Basically the equivalent of an RPS. This is not that the Virginia bill does not mandate that the utilities increase utilization. I think it works on the assumption that if you make this transparent, right? If you publish the metrics and then you've got a PUC that's keen to do this, it's going to happen anyway, but we should make a note it does not mandate any particular level of utilization. That's right. And for what it's worth, I'm not sure that like an RPS for gridulization is the right way to think about this. Our perspective is that measuring this is the really the key starting point and then finding the right ways to incentivize it. So that it's a win for all parties involved. And it does admittedly put some of the onus on the commissions to get this right. Yes. And you've had other guests on your show talk about utility commissions that regulate utilities. They vary in quality. And why they're important and why they're, I think people have described them as the Supreme Court of Energy. And so we're putting some of the onus on them to ensure that that this works well. And so I think that there's going to be important regulatory work from a wide range of stakeholders, consumer advocates and different interest groups and utilities themselves to work with commissions to ensure that the right metrics are developed. Right. But it doesn't presume at the outset to try to peg some correct level of utilization. Right. Just says more. Right. So we're kind of back to the question of like, is there any sort of consensus on like what the upper bound of a safe level of utilization is? Like, do we know? I think this is one of the things that's exciting about this emerging field is that we have yet to reach consensus on that question. Like historically, how has the highest has ever been? Do you know off the top of your head? I mean, I'm springing that question on you. But do you know like how high is it gotten in the past? Yeah. The Fed has some good numbers on this that I can circulate. Maybe you can put in your show notes. But yeah, it's fluctuated over time. And the consensus is we have a lot of extra capacity to unlock here. I think on the Fred graph you've seen, I think it has gotten as high as 80%. I'm sort of going from memory here. Yeah. And it depends on how you measure it. You could at least get that right. So Fred measures it differently than for instance. Yeah. Yeah. Yeah. The Browder report does. But you know, I think the point here is we need to look into this. And I don't think it makes sense in the current moment before we're even measuring these things in any state to sort of set a target. I think this is where we're at now. And I think it's a really important meaningful step to measure this and incentivize it at the state level. So politically you told a pretty happy story there, but I'm going to rewind and poke out it a little bit. Sure. The Virginia bill passed unanimously in the house. Very bipartisan. Yay. Awesome. And then it passed basically on a party line vote in the Senate, which like what happened. So I guess I want to poke a little more at the, you know, sort of the polarization or the lack of polarization or what it's like some Republicans in the Virginia Senate were against this. Yeah. It was a priority bill for the new governor. And so I think there are probably reflect. Yes. Opposing anything that was there was nothing more than just like. Yeah. Because there wasn't also substantive debate on this. And so, you know, there weren't long committee hearings with a wide range of interests, you know, discussing this at length. That didn't happen. So I feel thankfully sailed through pretty quickly. So it could get subsumed in polarization just because everything does, but the issue itself. As far as we can tell so far has a lot of bipartisan potential. Yes. And we've had really good conversations on this topic with Republicans in various states. And so I, you know, I'm cautiously optimistic. We're early days, but I really do think this is an approach that can work in red, blue and purple states. And so the Virginia is, as, as mentioned, like absolutely the place you would start for this because they've got millions of data centers coming. It's a big political fight. It was the center of the gubernatorial race. Bills are like going up really dramatic fashion. And the thing is as kind of boiling there as it gets that adds a lot of political pressure and impetus and tailwinds. You don't necessarily have all of that in other states. You don't necessarily have those tailwinds in other states. So I'm sort of curious like what other states are you targeting and why? Like what are you looking for in a state? You know, are you sort of going down the line like who's the next state getting screwed by data centers or how are you thinking about. What states are right here? We have actually created a spreadsheet which is pretty easy to write. replicate since you can find this data publicly. And we've looked at where our states where load growth is happening, right? Demand for electricity is going up. And rates are increasing. The price of electricity is going up. And those are places where we think that makes sense. And that is happening across a wide range. - That's a lot. - Red blue and purple states. So those are I think some of the states that we will prioritize. Our thinking with this campaign is to focus this year on really helping get gridulization out there in the broader public consciousness, right? Raising it as a bigger topic like we're doing today and getting people to think about it and understand it and see it significance. And then a broader legislative push next year in 2027. So I think that, you know, early days we'll see, but I think there's a wide range of states that will be interested in this and where there's enough political will to do something new and different. - You know, I wanna believe, I mean, I know you don't wanna get ahead of yourself, but like, is there a red state where there are active discussions happening where we might actually see this breakout soon, something happened soon in a red state? - Sure, I mean, we haven't decided all the states that will be focused on, but, you know, there are Republican leaders who are talking about this across the country, including, you know, the governor of Indiana has talked about the importance of bringing down utility bills. And the current DOE has been talking about this. So Secretary Wright has even said, we gotta get more out of the grid. We have, Kathryn Horacea, who oversees the Office of Electricity at DOE, talks about her stabilized, optimized and grow agenda. And that second bullet point, optimized. It's really about what we're talking about here. - Yeah, I mean, it seems to serve everyone's interests, but I just don't trust anything these days. And I guess, you know, like a lot of what I'm poking at and trying to get at is, is there, maybe it's too early in all this to even know, but like, is there organized opposition to this? Like, is there a faction or a constituency that has some sort of like principled or empirical case to make against this? Is there anyone against it? - Yeah, I think the biggest barrier to this is the status quo. - Yes. - And it's easy to just throw out there, but let's break down why that's the case. We have historically built our grid in America to peak. And we've had to do it that way. And so building our grid less towards peak and more towards system-wide utilization is a shift in how we think about how we build the grid in America. And so, you know, that's a meaningful shift. And anytime you have a large complex system like the American electricity grid, changed by nature is slow. And historically that has served us well. While, you know, move fast and break things might arguably have worked in Silicon Valley for certain companies at certain times, does not work well for the US grid. And so, you know, we're trying to be very thoughtful and intentional about this. And anytime you propose a big new idea, it's gonna take some time. The fantastic tailwind that we have is that people across the political spectrum want to act on affordability or looking for new solutions. And so, I think that opens up the door along with, as we discussed, the technology's changing and being ready for prime time. And so, we feel like we've finally reached a moment in this country, which we were not in five, 10 years ago, where you have the political, economic, and market forces all coming together in a moment where this could really happen. - Yeah, it's the thing about the coalition politics. Like, as we said before, this is like a win, win, win, win, win, win, win, win, win. Situation. So, they're like, wins to hand out to almost any constituency you want to talk to. Like, what just occurred to me is like, I wonder if you've gotten green groups on board. And I wonder specifically if you've got an environmental justice groups on board because one of the side effects of greater utilization would be, I think, greater resilience. You briefly mentioned this before, but that strikes me as like a very important thing in some communities. - Absolutely. And that's, I mean, there's me a wide range of constituents that we need to engage. We are in the early days, so we have certainly not spoken to everyone. And we're gonna have to sit down with a lot of different groups. And I think one of the things that will make this easier is that we're not a trade association, right? I'm not out representing any of the companies I mentioned on a whole wide range of issues. We're a campaign coming together to work on one thing and one thing only. And we're willing to work with a wide range of stakeholders who may disagree vehemently on other things, but who can agree on this one thing. - Yes. Question about the state focus. I mean, obviously, it makes sense to me to start with states here because utilities are regulated at the state level. Most of the energy action is at the state level, but it seems like there are, well, I'll just ask you, are there federal tools here? Is there something FERC, for instance, could do to enhance grid utilization? - Yes. And so we're primarily a state focused campaign, but FERC oversees transmission in America. And that's a big part of this as well. And so we've, members of our coalition have actually sat down with FERC commissioners and begun discussing this. And I think there's interest. So, there's an argument you made that FERC theoretically could do this on their own without congressional direction. - Oh, really do what specifically? - Prioritize grid utilization. In other words, require metrics and begin incentivizing an increase in utilization is an action that could be taken. And I think we're gonna continue having those conversations as well. - Yeah, 'cause obviously you and I, you come out of rewiring America, sort of the residential side, the DER side, the VPP side, this is of course my allegiance as well. I'm a fanboy of all that stuff, but it really does seem like the transmission side. There are just such easy solutions and they make such a big difference. The study you've seen about transmission utilization in the West is just wild. Like we have all these very expensive, long distance high voltage lines that are being utilized at like, I forget what the exact number is like 18 to 30% on average or something in the West. Like you could double that pretty easily with existing grid enhancing technologies that the line ratings, all the things you mentioned, it double the throughput of the Western grid with relatively easy interventions. Like the potential for this on the transmission side is huge, I guess is what I'm saying. - Absolutely, and I'm glad you raised that because the transmission side is equally as important as the distribution side and we have to be thinking about these things holistically. And the Stanford study, my understanding, which folks can read was dropped in December, I believe right before the holidays. So I think very few people actually read this really interesting study on exactly all the things we're talking about, utilization of the transmission system in the West. I think they're following up and doing another study in the East is my understanding. - Yeah, that'll be so interesting. I want to assume that it's lower in the West in the East, but I don't actually. - We'll find out. - Well, we often get countering to it results from grid studies. - Right, you're touching on something really important, which I think more research needs to be done in the domain and we're eager to work with a wide range of partners who continue this research. We think the Brattle study is a really great foundational piece. And we think that there's more research to be done across the board on gridulization and how we can approve it. - But in terms of what people can do, this seems pretty clear. As complicated as some of the nuts and bolts are of increasing utilization, the concept is pretty easy to grasp and the legislation is one page long. So I guess if you're asking what people can do, is just like talk to your lawmakers about passing a similar one page bill. Are there avenues for people to get engaged here? - Sure, yeah, no, I think that's a great one. I think you have a wide range of listeners, David. I think that researchers can play a role in this. I think policymakers can play a role for this. I think the technologies and companies that are already working on this can play a role and help us advocate for it. And I think any individual citizen, you're right, can talk to their lawmakers and say, "Hey, electricity prices are too high. I paid for a lot of this grid over many years and I want to make sure that we're getting the most out of it for myself and for our country." - And I would just say, again, you mentioned this earlier, but it's worth underscoring. There's a lot of not great ideas about affordability, floating around the political world right now. Everybody's getting involved. Lots of people are getting involved with, shall we say, a loose grasp of substance, of electricity issues. So it's just good if nothing else, given that the affordability conversation is already underway, it's happening that that ball is rolling down, the boulder is rolling down hill, it's good to get a good affordability idea in the mix, right? - That's right. We're seeding the idea. We think that this is something that's not small ball. It has impact at scale and hopefully, can enable a wide variety of solutions to kind of come together all simultaneously. And this is like laboratories of democracy, right? Here we go. This is how it's supposed to work. It'd be great to see all the states or utilities and PUCs trying different things, getting a little more experimental, getting a little more, you know, just do stuff. - Exactly. And the path that Massachusetts could take to gradualization, maybe look different than the path that Utah or Nebraska would take. And we think that's okay. in states should be. figure out the right path to increasing its own utilization. How about a federal award, a grant to the state that hits the highest utilization target, a national contest. Let's really, let's blow this thing out again. You can pitch that to the 2028 presidential candidates. All right. I want to finish on a point that I made in my solo pod last year that you have kind of taken up and that is part of all of this, which is the no regrets aspect of all this. And just so if listeners missed that pod, they should go back and listen to it. But basically, like, we're in a situation now where it seems like we need a bunch more electricity grid, right? Got long cues, millions of data centers, whatever. But the fact is, as we've said many, many times, no one really knows how much demand there is for that. No one really knows the amount of uncertainty about the actual level of demand growth in coming decades is wildly huge. It's bizarre. It's crazy. It's crazy situation. Like an entire UK's worth of demand just beneath the top projection and the lowest projection. So all of which is to say, there's a danger here of us seeing this large but uncertain demand coming down the pike of us freaking out, building, building, building, and then the demand not like the bubble popping demand not showing up. We've been through this in this country before. So with that, I'll hand the point to you to make the point. Yeah. It's one of the big things that coming back to these utility commissions and these Supreme Court of Energy, so to speak, if you walk around the halls of neighbor, right, the National Association of Regular Utility Commissioners, where the regulators and the utilities and various interest groups come together, there are a lot of people talking about this and thinking about it, right? How much of this is real, how fast, do we have to move on these things? And there are big questions. We're going to need more power. We know that, but how much, how fast, et cetera. These are big questions. I think you've said it really well, which is we see utilization as the no regrets approach, which is regardless of whether or not you see some sort of a bubble or cyclical changes in demand here, getting more of the grid we have will serve us well for the long term, regardless. Yes. It would be beneficial in any scenario, right? I mean, that is sort of the definitions of a no regrets policy. Like, no matter what happens, it will be better for us if we're utilizing the grid at a higher rate. Exactly. And also, like, to gain, groping around grid analogies. This is what grid people spend half their lives doing, groping for good analogies. But I think about this as the analogy I try to use with people is like the DERs and the VPPs are sort of filling in gaps at the distribution level, right? So I think of it as like, cult, you know, like sealing up the cracks, making the joint firmer, building just a firmer foundation upon which we will go on to build a lot more, right? More transmission lines, more power plants, et cetera. But no matter what you want, you want that foundation to be as strong as possible. And that's kind of higher utilization is sort of a proxy, I think, for kind of the strength of the distribution grid. Exactly. And if it turns out, you know, 5, 10, however many years from now, the breakneck speed at which we're adding new load shifts in this country, and, you know, we accidentally just put a bunch of batteries in the grid and made everything work more efficiently. I don't think we're going to regret that outcome. No one regrets a battery. I'm going to make t-shirts. No one ever regrets a battery. All right, Ian, this is delightful. I love this effort. I love that you're highlighting this. I feel like this is long overdue. And this is another politically just bright spot where like everybody wants this. Everybody needs this. Everybody will benefit from this. Surely we can do this. Thanks David. We're excited. It was a great conversation. And we'll see where things go. How can people sort of get in touch and follow you? Sure. Yeah, we've got a website, utilizecoeolition.org. Feel free to, you know, join our email list there. Follow us on LinkedIn or other platforms. We'd love to be in touch. We're going to need a lot of different folks working on this together. Thank you for listening to Voltz. It takes a village to make this podcast work. Shout out especially to my super producer, Kyle McDonald, who makes me and my guests sound smart every week. And it is all supported entirely by listeners like you. So if you value conversations like this, please consider joining our community of paid subscribers at Voltz.wtf or leaving a nice review or telling a friend about Voltz or all three. Thanks so much and I'll see you next time.