00:00The hearing will come to order. Good morning and welcome to all of you.
00:04Today's hearing focuses on the challenges that America faces in meeting
00:10the increased demand for electricity, something that's gotten a lot of
00:15attention with good reason. Demand has been trending upward in recent years and
00:21some expect it could grow by 25% just in the next five years alone. Data centers
00:29supporting artificial intelligence, advanced manufacturing, and the planned
00:35retirement of current production sources are just a few of the causes creating
00:41this increased demand. And as more people are drawn toward electric cars that could
00:45put additional demand as well in play. America needs to put more electrons on
00:51the grid. We'll be hearing from three witnesses to better understand these
00:55issues today and we're very fortunate to have them. They are first Peter Huntsman,
00:59the chairman and CEO of Huntsman Corporation. Jeff Tench, the executive
01:04vice president of Vantage data centers. Welcome. And finally Rob Gramlich, the
01:10president of grid strategies. So thanks to all of you for being here. Now let's
01:14let's begin with a simple fact. America's electricity demand is surging. It's not
01:22creeping up, it's surging. For decades power demand in this country remained
01:28relatively flat. Utilities planned for it, markets priced for it, regulators counted
01:35on it, but that era is over. We're now entering a new era of electrification. Data
01:43centers, AI computing, manufacturing, returning home, electric vehicles, all of it. Even
01:49conservative estimates suggest that we could see two to three percent annual growth
01:54compounded over the next decade. Now that number two to three percent annually compounded.
01:59That might not sound like much, but it's it's like a two-way highway that was built decades
02:07ago that's now expected to carry rush hour traffic to and from a major city every time,
02:13every day of the year. More cars, bigger trucks, constant congestion. And if the
02:19road hasn't changed, but everything around it has changed, that's going to be an
02:26issue. Now that it's a fairly decent analogy, something to help understand our
02:32power grid. And the challenge is now facing it. Now here's the real problem. We have
02:38spent much of the last 20 years shutting down the generation that can actually meet that demand.
02:46Coal plants, retired. Nuclear, blocked. Natural gas, tied up in endless litigation. And we replaced
02:55a lot of that capacity with wind, solar and batteries, resources that by design don't work
03:02all the time. Work roughly a third of the time. One third of the time. That's not enough. Not enough
03:10to support the dispatchable baseload power that we got from the other sources I mentioned. These
03:16resources being non-dispatchable means that they cannot be dispatched at the exact moment that they're
03:26needed with predictability and the reliability that is required. They do not provide baseload power.
03:36And they do not build themselves. They require massive transmission overhauls, grid upgrades,
03:41and most importantly, in many circumstances, subsidies. So this isn't a free market. In many ways,
03:48it's a rigged one. The federal government has been investing heavily in certain green energy technologies
03:55for decades handing out tax credits like candy. So naturally, developers follow these credits,
04:01and why wouldn't they? But what's the result? 95% of the projects waiting to connect to the grid
04:08happen to be wind, solar, and batteries. But only 10% of those ever make it online onto the grid.
04:14Meanwhile, gas plants, nuclear reactors, geothermal, these things that can actually power a modern economy,
04:21providing predictable, reliable, affordable, clean, baseload power. They get crowded out or delayed
04:31endlessly or blocked entirely. Why? Well, government red tape is responsible for a lot of it. And
04:41activist-funded lawsuits also have a fair amount to do with it. Because a government that picks winners and
04:48losers and consistently picks losers creates a lot of this problem. Now, look at what FERC tells us.
04:56According to FERC, between now and 2028, we're set to retire 24 gigawatts of coal-fired generation, just in
05:03the next three years alone, and replace it with just 5 gigawatts of gas-fired power. That math doesn't work.
05:11Not in theory, not in practice, not now, not then, not anywhere, or at any time. The system was built for slow,
05:20steady growth. What we're facing now is a tidal wave. And if we don't change course, if we don't wake
05:28up to this reality, the lights are going out. We need utilities, developers, states, and congress to start
05:35telling the truth about this. The grid is not ready. The system is not built for this. And the path
05:41that we're on will culminate quite predictably in rolling blackouts, rising prices, national
05:49vulnerability, and our inability to remain competitive in what many are describing as the AI
05:55global arms race. In fact, only July 7th, the U.S. Energy Department warned that between
06:04the growth in demand and the retirement of some current sources, if we don't take steps to respond
06:09to the increased demand, the risk of blackouts in the United States will increase a hundred-fold.
06:15I repeat, increasing 100 times what we currently face in terms of blackouts across the country.
06:26We currently experience annual outage hours in the single digits. And if we don't take effective
06:32steps, the estimate is more than 800 outage hours per year in the next five years. We cannot allow that
06:42to happen. We've got too much riding on that. It's time that we face the facts, and that's what this
06:47hearing is about. And the chair now recognizes
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