Challenging environmental changes

Dean Emeritus Joseph P. Tomain, Wilbert and Helen Ziegler Professor of Law, is a highly respected professor and scholar, teaching and conducting research in the areas of law and the humanities, energy law, and regulatory policy. He has published in these areas for over 40 years, producing numerous articles, essays, casebooks, treatises, and monographs, as well as delivered papers at conferences through the U.S. and Europe.   

In late April Dean Tomain led a moderated conversation with three distinguished Cincinnati Law alumni discussing climate change, energy and the environment. The participants—Julie Janson ’88, Executive Vice President and Chief Executive Officer, Duke Energy Carolinas; Neil Chatterjee ’02, Commissioner, Federal Energy Regulatory Commission; and Seán Arthurs ’05, Director of Global Education and Training, EarthRights International—are well-respected in their fields and bring thoughtful analysis to today's environmental changes and impacts. Here’s their insightful conversation. You can also view the conversation on the College’s YouTube channel in its entirety.

Julie Janson: I saw a posting in the career development office at the law school in 1987 for a summer internship at the Cincinnati Gas and Electric Company, and here we are 33 years later. I started full-time a couple weeks after I took the bar exam and have since had at least a dozen roles. I would say two thirds of them have been legal in different subject matter expertise areas. Most notably I served as the corporation’s general counsel for seven years. Then about a third of those roles have been non-legal in various operating responsibilities. I served as the president of the Ohio and Kentucky region before relocating to the Carolinas in 2012 in the general counsel role, and I’m currently EVP and CEO of the Carolinas, which is North and South Carolina regions for Duke Energy.

JJ: That is such a good question. I will tell you, having spent the early part of my career in the practice of law, those of us who are trained in this, I think, we have a bit of a hard time letting it go. The training is so terrific from the perspective of the way we approach problem solving. When I went to my first business role, issues come at you really fast, you learn the business quickly as opposed to when you practice law. I think it's more iterative in that respect. But you return to the practice of law with a very different view about what your business clients need from you.

Neil Chatterjee: It’s been a fascinating journey. I had the great fortune of being a student at UC while you were dean. My parents were faculty at the time at the Vontz Cancer Center, and the University of Cincinnati has a wonderful tuition remission program for the children of faculty, and my parents really encouraged me. They viewed education as a buffet in that you should consume as much as possible. So, I enrolled in the JD/MBA program and did my first and second year of law school, then did what would have been my third year at the business school, then came back for my final year of law school. I was in business school on September 11, 2001 and decided at that point that I wanted to serve my country in some capacity.

My best friend in business school, Bill Mulvihill, whose father also worked at the university, and I shared that vision. He graduated from business school and got a job with then congressman, now U.S. Senator, Rob Portman. I had a job lined up at an insurance defense firm in Cincinnati and a $400 a month apartment in Northern Kentucky. I went to visit Bill in Washington, and I just saw the work that he was doing, and I asked him, “How does one get here? How do I get a job in the legislative branch of government?” He said, “Neil, no one cares that you’re a lawyer, that you went to business school. You have no prior experience. Congressman Portman is on a very prestigious committee, the House Committee on Ways and Means, we can get you an internship on the committee.”

So here, as all my fellow graduates from UC went on to jobs at wonderful firms in and around the region with well paying salaries, I took an internship that paid me a $1,400 monthly stipend. Meanwhile my rent was $1,650 in the Washington, D.C., area. But I knew at the time that I would be passionate about public service and I thought that if I went into a field I truly loved, that I would be successful in it. And I worked my way up through the legislative process. I worked for a congresswoman from Ohio named Deborah Pryce, who represented the Columbus area in the 2000s. Then I got an opportunity to serve my home state senator, I’m a Kentuckian originally, Senator Mitch McConnell, during a time that he was serving as minority leader in the Senate.

And what maybe is not clearly visible to folks who observe the agency process, bi-partisan boards like FERC, like the FCC and the SEC, these are independent agencies comprised of individuals who represent both parties. And per the terms of an agreement that was struck during the Clinton era by then Senate leaders, Bob Dole and Tom Daschle, they brokered an arrangement where the Senate leader of the party that doesn't control the White House identifies that party's candidates for bi-partisan boards and commissions. So, for the eight years that President Obama was in office, Senator McConnell picked the Republican candidates to serve on these various bi-partisan boards and commissions. Since I was his principal energy policy advisor, it was my responsibility to identify and vet candidates for FERC. In doing so, I paid very close attention to the agency and its authorities.

When a vacancy came up in 2016 on the commission, I had identified a candidate for it that I thought would be perfect, someone who had been a mentor to me in the Senate. I put this individual in front of Senator McConnell. Senator McConnell loved this person, and we moved this person forward with the Obama administration to be nominated for the FERC vacancy. This person got cold feet and backed out. I was alarmed. I thought, what do I do now? We urgently need to fill this vacancy, you were the perfect candidate for it, what do we do?

This person said, "Let's go out to dinner and I'll have a suggestion for you on who could fill this seat." I went out to dinner assuming that I would get a list of potential alternatives and this individual said, "Neil, you are the one person that ought to fill this vacancy at this time." I was flattered, but a little taken aback. This person ultimately convinced me to go for it and I had a conversation with Senator McConnell and he graciously put me forward for it. I have had the wonderful opportunity to serve at the commission for the past four years at what has been really an exciting time in the energy landscape.

The country's in the midst of this tremendous energy transition, FERC is squarely at the epicenter of it and it's been an honor. And back to that original decision that I made to take that internship in DC, I've been passionate about coming to work every day and I think that's helped me in the job.

NC: It's been interesting. I had a wonderful experience working in the House and working in the Senate and being immersed in the political process, but I actually had to very seriously make the transition from partisan political aid to independent regulator. And I've been pretty public that I struggled with it initially. I think during my initial months on the commission I was approaching issues before an independent regulatory through a partisan political lens and it took a while for me to recognize how problematic that was. I was kind of roiling markets and stakeholders who weren't certain that I would be able to separate my partisan political views from my role at an independent quasi-judicial body.

It took me a while to grow into my role at an independent quasi-judicial body, but I'm hopeful now as I come towards the conclusion of my term, that stakeholders will appreciate that I did ultimately grow into the role and did carry myself in an independent matter, calling balls and strikes based on the facts and the record in the dockets before us. But I will be the first to admit that initially switching those hats was tricky.

Seán Arthurs: This is a good point, Joe. Neil talked about how his parents looked at education as a buffet. I think my parents wish I would stop eating at the education buffet because I’m now at five degrees, with hopefully no more, though I never say never. But it has been a great story and a different arc since UC. It looks like Julie had 12 roles within one company, I think I've had 12 roles within different companies since UC. I started at Legal Aid right out of law school as a Skadden fellow working with victims of domestic violence. I went on to a clerkship in Washington, DC at the DC District Court, then joined Sherman and Sterling as a litigator for three years. Something I’m seeing as a commonality in our stories here is, when you see an opportunity, when you see a door, walk through it.

Prior to UC I had been a teacher, loved teaching, and went into the law to think about how to have more of a systemic impact and make change on that level. An opportunity came up at the Georgetown Street Law Clinic as a teaching fellow, which combined law and education. As I was coming to the end of that fellowship, I was thinking, ‘I loved some of the stuff I was doing in the law. I love what I'm doing in education, how can I really combine those and think about having an impact, be a system level leader?’ I applied for an Education Leadership doctoral program at Harvard that takes 25 people a year. I thought there was no way I’d get in, but I took my shot.

I was really fortunate, got into that program and spent three years up in Boston. Then I wanted to think about scaling, this was one of the biggest challenges in any sector, I think, but especially in education, how do you scale a successful intervention or program?

So, I was with the National PTA for about two and a half years scaling their programs. I then decided I really want to get back into education not just focused on scaling. So, I was doing consulting with a variety of school districts and nonprofits around the country, and then this unique opportunity came up. And I think as I trace my career arc since UC, I can say that it's been a path with heart and a dose of practicality thrown in there as well.

But this opportunity came up at EarthRights International to be the director of global education and training. And it just seemed like the perfect unification. At UC I was part of the Urban Morgan Institute and did a lot of work with Bert Lockwood and the International Human Rights Program. And I had my background as a teacher, so it was a chance to bring together my legal background, my education background, and also combine it with the promotion of human rights.

SA: EarthRights works to combine the power of people and the power of law to protect what we call earth rights. It's a combination of environmental rights and human rights and they point to this term earth rights. They brought me on because we have some amazing initiatives going on around the world. We have a school building in Chiang Mai, Thailand, where we actually bring in about 15 to 20 indigenous activists, people in communities in countries in Southeast Asia, Myanmar, Cambodia, Thailand, Vietnam, and they come together and learn about how to work with their communities, to resist corporate and governmental environmental abuses in their communities.

We train folks for almost six months in Chiang Mai, Thailand. We’re thinking about how can we improve that program, possibly scale it. We also have an office in the Amazon where we train indigenous lawyers, primarily female. We have an amazing team down in the Amazon, and we bring in these indigenous lawyers for about two weeks, we train them, and they go back to their communities. One of our guiding principles is working with communities. Community interests are first.

We've been invited to other locations around the globe. They brought me on to think about our education program globally. There's talk about working towards building a global school. As you can imagine, that's been hampered by COVID, but we're going to bring together folks from river valley basins around the world so they can share lessons and best practices. And then we're also trying to see how we can pivot to online. We've got some really exciting global initiatives and then also our work on the ground in schools.

SA: Yes. We have an entire legal department who have brought some pretty groundbreaking cases, including the Doe v. Unocal, which was one of the cases that got EarthRights started in the first place. We train lawyers, indigenous activists and frontline community members, and we train them on how to partner with others and how to mobilize their community to resist any abuses. In advocacy, there's an education component, there's skills building, but most broadly, I’m training for advocacy.

SA: Yeah. And it's a really unique combination, Joe, because we've got lawyers that we’re bringing in. We're working with activist Krystal Two Bulls on the Dakota Access Pipeline. We're working with communities in Colorado. We're also working with the U'wa tribe in Columbia. We have a legal team that handles all of that and then we are also doing this frontline work with activists. Our founder, Ka Hsaw Wa, was imprisoned and tortured for his activism 25 years ago, which led him to found this group. But we're working with people in the Mekong who may have no formal education, and they come to our school and learn about environmental rights and climate change and what their options are, and then we're working with people who know more about environmental rights, who might be on Professor Mank's level. And then we've got the lawsuits and the litigation as well as the education and training arm. There’s a wide range in the audiences we're working with.

NC: There are many things that I've tried to do to bring the commission into better alignment with not just market realities in the 21st century, but also with how the commission interacts with the public. I'll first start with some of the softer, non-substantive things we've done. I've been very visible both as chairman and a commissioner, I've been out there and accessible.

I think initially some FERC workers were taken aback because they hadn't seen that in a regulator before. But over the last couple of years the commission's profile has risen as the public has become more aware of issues around energy transition, their own energy consumption and the challenges being posed by global climate change. The role of the commission and the accessibility of the commission has become more and more of an issue. And I've been pleased to hear from folks who commend everything we've done, from updating our website and our e-library platform, to encouraging both the commission and project stakeholders to be more targeted in communicating with communities and landowners as we go about the work we need to do in evaluating energy infrastructure projects.

It is not the responsibility of a landowner to keep up with FERC dockets and I think we've done a good job in bridging that. As the commission and the energy landscape changes, you have new parties, new entrants to the energy sphere. For instance, we've now got big tech. Everyone from Google to Amazon to Facebook, these large energy consumers who are now looking for an opportunity to actually become players in energy markets. They historically haven't been as familiar with the commission of statutory authorities and processes, and I've had people thank me for making the commission more accessible. That’s brought more stakeholders to the table and given them the opportunity to engage and ensure their voices are heard. I think that's really important and that's something that I'm proud of.

In terms of what we've done on the substantive side, just so much has changed in the energy world. When I first came to Washington, the first significant piece of energy legislation I worked on was the Energy Policy Act of 2005, and that's really the last time that Congress addressed energy policy in any significant way. The last 16 years, most of the legislative updates that have occurred in the energy space have happened in omnibus appropriations bills or in tax bills. There has not been a really significant look at the energy challenges that the country is facing from Congress, and in the absence of that direction, more and more of the critical decisions are falling to agencies like FERC that, in some instances, don't have the tools to really tackle these pressing challenges.

The common denominator for me, throughout my tenure, has been a focus on markets, on really developing a regulatory ecosystem that enables new technologies to flourish and for markets to thrive. That can range from updating the commission's PURPA regulations, which were initially enacted in 1978 and in my view no longer matched the realities on the ground in the 21st century, to removing barriers to entry for innovative new technologies like battery storage and aggregated distributed energy resources.

I think FERC taking that step of being an enabler, of removing obstacles that have inhibited these innovative new technologies, I think that's been the ideal method to really facilitating a market-driven approach to energy policy that I think better aligns the country's regulations with the realities of the 21st century marketplace.

JJ: Pretty much, Joe. And our stakeholders didn't have a whole lot of interest in our business either. But I have to tell you, I am so humbled to have an opportunity to speak with all of you. And one of the threads that I hear through this conversation is the importance of stakeholder engagement. I think about how powerful Seán and I could be working together, as well as with Commissioner Chatterjee. You don't solve big, hairy problems as a society looking at things in either a partisan or a litigious way. You solve them by sitting down and really working through the issues.

As I think about my current role, I have responsibility for the regulatory and legislative affairs in the Carolinas, as well as the strategic planning and the financial performance of our Carolinas utilities. Our corporate strategy is our business strategy, which is to reach net zero carbon emissions by 2050. We have a couple interim goals at 2030, net zero methane, and at least a 50% reduction in CO2 emissions by 2030 (from 2005 levels). Our business has retired 51 coal units since 2011. Over the next decade we have the largest fleet transition in the industry set out before us. We've reduced our carbon emissions by 40% since 2005, so we're all headed to the same place.

I think we have the complicating responsibility to actually provide power that is reliable, that is affordable, that works from a physics perspective in an increasingly clean way. You started the question with state and federal and permitting, and it isn't an easy job. I used to have responsibility for corporate communications, and one of the things we say internally is, “If we're explaining, we're losing.” The headlines can be so simple, ‘no fossil fuels,’ ‘no coal,’ but we've got to operate a system that doesn't switch on a dime, and we're trying to find cleaner forms of generation, zero-emitting load following resources, new technologies that will get us from here to there so that we can meet these goals. I think working together is going to be so important because we all see the end goal, and we need to work to get there together.

JJ: The latter. And it's interesting because we serve seven and a half million meters, as we used to call them, which if you think about four people in a household, 30 million customers in seven jurisdictions. We would not put a goal out that we didn't see a real way to achieve. We have worked and solved and run analysis and inputs to get us there, and so you can imagine if for either a reliability reason or a regulatory reason we wouldn't be able to retire a coal facility in one part of the enterprise, then we'll need to pick up the pace someplace else to get us to those interim goals and then to that final goal.

But we really see the need for R&D, for new technologies, advanced nuclear, hydrogen, carbon capture and sequestration in that mid-2030s to come in hard for us so that we can get to that 2050 goal, because today we're a bit hamstrung with the limitations on four-hour lithium-ion battery technology. In the Carolinas we are a winter peaking system, and today we do not have a way to get that July afternoon sunshine to a cold February morning.

I think about the Texas market and what happened there in mid-February. You had markets and players and generators, and I know that fingers have been pointed and will be pointed. In the Carolinas, you have us. I will do anything humanly possible to avoid a situation like that because this is all about our customers. They depend on us.

JJ: One of my responsibilities is for long-term strategic planning for these Carolinas utilities, and I've got someplace I have to be in 2050. Hopefully I'll leave those who come behind me in a good situation to achieve that, but there's a bit of back solving. What decisions, what investments, what partnerships do we need to be making today to get us there? 5-year goals, 10-year goals, 15-year goals. As a business we have investors, we have responsibility to pay dividends, we have our communities and our customers to serve, and we have 30,000 employees in seven states throughout our country to whom we have an obligation as well. It’s a multi-pronged equation, but one I'm thrilled to have the opportunity to work on.

JJ: Well, we have the largest regulated nuclear fleet, and very well run I might add, with both a really stellar performance record and low cost to our customers. In the Carolinas, I think there could be a number of distributed advanced nuclear opportunities. I think green hydrogen in particular is very promising, carbon capture, but at this point I'm not prepared to pick one. I just say let's invest in them and figure out which ones are going to work instead of fighting about what I think for the most part we agree on.

NC: I’m going to take a different approach to the question. That’s not our role to identify technologies. I will leave that to the innovators. But there is a role that FERC can play in that we can create that regulatory flexibility to enable the deployment of those new technologies. For example, in FERC Order 2222, which removes barriers to entry for aggregated distributed energy resources, we specifically built in flexibility to accommodate technologies that we might not even be able to envision today. I think that's the role that the government and regulators can play.

We aren't responsible for the innovation, but we should not be inhibitors to innovation, and so to the extent that we can provide that regulatory flexibility, I think that's important.

To touch on your prior point about the role that the private sector has played in the energy transition, I think as a nation we can all be proud of the de-carbonization efforts that have taken place in the US power sector. I will note that cap and trade legislation that had been proposed in the late 2009, 2010 era was never enacted by Congress.           

The Obama era EPA Clean Power Plan got stayed by the courts. President Trump famously pulled the US out of the Paris Climate Accords, and yet US power sector emissions continued to decline even in the absence of federal government action. I think that's a testament to the power sector, to stakeholders and to consumers. Consumers ranging from Fortune 100 Companies to small businesses to individual families are becoming more aware of their sources of energy. They’re demanding cleaner sources of energy and utilities, and energy providers like Duke are stepping up and meeting their consumers. And I'm a big believer in that market driven approach. I think our markets have successfully squeezed carbon out and we will continue to do so.

One of the more enjoyable components of my tenure at the commission is having our international allies reach out to us for guidance and for expertise. When I initially took this position as a domestic energy regulator, I didn't anticipate that I would have opportunities to represent the United States government in India and Japan and in Western Europe. What we're finding is that our allies are looking to FERC as the body which has the foremost experience in overseeing these competitive energy markets. They want to learn from us so that they can better design their markets and their grids to see the similar benefits that we have seen. So, I think as we're undergoing this energy transition, it's important to take a step back and appreciate how far we've already come.

SA: I'm heartened to hear how, especially I know Neil has limitations as a governmental employee, I'm heartened to hear from Julie just both with the need for collective action and the efforts moving towards net neutral carbon 2050. There's an analogy I’d like to use. Katharine Hayhoe uses an analogy I like where, you walk into your bathroom and you see your bathtub is overflowing. The faucet is on, it's overflowing. You walk over and first you need to turn off the faucet, right? We need to reduce greenhouse gas emissions, but then we also need to unclog the drain. And Julie talked about some of the carbon capture or carbon removal efforts; there are a lot of different ways to unclog the drain and also slow down the water coming out of the faucet in the future.

I know it's early on. But there are some initiatives in Iceland—there’s a Swiss company working in Iceland to do negative emissions and capture carbon—that is really fascinating from the technology side. And if I could go back one second, Joe, I was really hoping I'd get to answer the question about the greatest challenge or one of the greatest, now there are many, right?

Turning off the faucet and unclogging the drain, there's lots of opportunities. I don't know that there's one silver bullet, but one of the things that we have certainly seen that’s incredibly troubling, and we've seen in the last year really, a lot of people have called it America's reckoning with race. But I think in the energy and climate space there is massive environmental discrimination and racism that we've seen everywhere, from where facilities are located to how people are impacted to the options they have. You know, especially indigenous communities and communities that don't have access to a lot of resources, the impact and the suffering, the choices that they have, I think that's something that we can amplify as well. The impact of this is not being felt equally.

SA: As we all know, there’s the law as it's written, and the law as it's enforced. But I think seeing enforcement, holding companies accountable to some of the promises and obligations that are made is important. Thinking carefully about the subsidies and looking at the massive imbalance between subsidies that we're giving to green energy and that are given to coal, I think that would perhaps be where I would start. I look forward to hearing what Neil and Julie are thinking on this, too.

NC: I’m actually going to make a higher-level point here. And I'm not saying this to be flip or funny, but I think we need to make energy policy boring again. What do I mean by that?

I think it was around the time cap and trade legislation and the Clean Power Plan that suddenly energy became really politicized. And I think that's unfortunate because when it comes to the grid and particularly the reliability, affordability, safety, and cleanliness of the grid, this shouldn't be political.

Julie referenced what happened in Texas, which was truly a humanitarian crisis and a real tragedy. People lost their lives, their homes, their businesses. In the aftermath of that I was frustrated that people quickly jumped to their partisan corners and, depending on your viewpoint, pointed fingers at the failures of particular fuel sources or market designs, or Texas's independence and interconnectivity. I think what struck home to me was how important it is for energy policy makers and regulators to be above politics and to just make the right calls to let the engineers and the economists and the lawyers make the interim changes that are necessary to stay abreast of the energy transition, and not have it be political.

So, I think if we can get back to boring substantive conversations around energy policy and take the political zest out of it, we can move the country forward in the right direction. Because as I mentioned earlier, if these decisions fall to unelected bureaucrats such as myself and agencies like FERC, we don't have the tools necessary to tackle some of these big challenges. The perfect example for that to me is transmission. Everyone is looking to FERC right now as there's this big bold ambition around building out a more robust transmission infrastructure and ensuring that we have the grid of the future in place to bring remote renewables to power centers. People are looking at FERC for guidance here, and they don't recognize that we don't have the ability to do this, we don't site transmission lines.

NC: I'm just pointing that out. And I want to be very, very clear. I am not advocating for any legislation to give FERC siting authority. I'm simply pointing out an area in which people are turning to the commission, and the commission just doesn't have the tools to execute upon what is being asked of us.

JJ: Well, the transmission, the investments required with the distributed generation resources and the need to invest in all of that is also a big component of what we're looking at. But I think from a policy perspective, cost-effective, market-based, equitable, promotes technological advances and probably not industry specific. We've got the transportation sector and certainly we're leaning into electrification of the transportation sector. But again, I think something that is cost-effective, and market based is probably the direction.

JJ: It's never been a more exciting time to be part of this industry. I've spoken to some Chapel Hill law students and I think the idea that you wouldn't want to be in energy and environmental law right now, I just can't understand because it's such an exciting time. The transition is upon us and we continue to look forward to working with our stakeholders and for the benefit of our customers.

NC: I think our role is going to continue to rise. I think many of the critical decisions that the country will face over the next couple of years regarding the energy transition, regarding electric reliability amidst the push for de-carbonization, are going to continue to keep the agency in focus. I think we're going to do a better job as that visibility increases with outreach, with ensuring accessibility to a greater number of stakeholders. But I think FERC is clearly out of the shadows now. When I first learned of the commission it was sort of perceived to be a sleepy technocratic agency. Obscure is the term that I heard quite a bit. I think it's quite clear that that is no longer the case. But I also hope that we continue to see independent experienced commissioners who are willing to serve, who will continue to execute on FERC's mission of ensuring just and reasonable rates and maintaining the reliability of the grid.

SA: I think lots of people put this far better than I, but any group in the human rights space, their aspirational goal is to work themselves out of existence, to the point they're no longer needed to monitor and enforce. That would be a long-term goal. I think in the short term, I'm encouraged by just the different efforts in the private sector and by the government and the access to new stakeholders. We would like to increase our education efforts and empower and partner with indigenous communities around the globe more and more and help educate and inform so that they can be making the decisions they want to make for their communities.