    [Senate Hearing 118-338]
    [From the U.S. Government Publishing Office]

                                                            S. Hrg. 118-338

                    THE OPPORTUNITIES, RISKS, AND CHALLENGES
                      ASSOCIATED WITH GROWTH IN DEMAND FOR
                      ELECTRIC POWER IN THE UNITED STATES

    =======================================================================

                                    HEARING

                                   BEFORE THE

                                  COMMITTEE ON
                          ENERGY AND NATURAL RESOURCES
                              UNITED STATES SENATE

                        ONE HUNDRED EIGHTEENTH CONGRESS

                                 SECOND SESSION

                                   __________

                                  MAY 21, 2024

                                   __________

    [GRAPHIC NOT AVAILABLE IN TIFF FORMAT]

                           Printed for the use of the
                   Committee on Energy and Natural Resources

            Available via the World Wide Web: http://www.govinfo.gov

                                    __________

                       U.S. GOVERNMENT PUBLISHING OFFICE
    55-900                    WASHINGTON : 2025

    -----------------------------------------------------------------------------------

                   COMMITTEE ON ENERGY AND NATURAL RESOURCES

                    JOE MANCHIN III, West Virginia, Chairman
    RON WYDEN, Oregon                    JOHN BARRASSO, Wyoming
    MARIA CANTWELL, Washington           JAMES E. RISCH, Idaho
    BERNARD SANDERS, Vermont             MIKE LEE, Utah
    MARTIN HEINRICH, New Mexico          STEVE DAINES, Montana
    MAZIE K. HIRONO, Hawaii              LISA MURKOWSKI, Alaska
    ANGUS S. KING, JR., Maine            JOHN HOEVEN, North Dakota
    CATHERINE CORTEZ MASTO, Nevada       BILL CASSIDY, Louisiana
    JOHN W. HICKENLOOPER, Colorado       CINDY HYDE-SMITH, Mississippi
    ALEX PADILLA, California             JOSH HAWLEY, Missouri

                          Renae Black, Staff Director
                          Sam E. Fowler, Chief Counsel
                    Daniel Palken, Professional Staff Member
                  Justin J. Memmott, Republican Staff Director
               Patrick J. McCormick III, Republican Chief Counsel
           Valerie Manak, Republican Deputy Staff Director for Energy

                               C O N T E N T S

                                  ----------

                               OPENING STATEMENTS

                                                                       Page
    Manchin III, Hon. Joe, Chairman and a U.S. Senator from West
      Virginia.......................................................     1
    Barrasso, Hon. John, Ranking Member and a U.S. Senator from
      Wyoming........................................................     9
    Risch, Hon. James E., a U.S. Senator from Idaho..................    12

                                   WITNESSES

    Fowke III, Benjamin G.S., Interim CEO and President, American
      Electric Power Company.........................................    13
    Onaran, Karen, President and CEO, Electricity Consumers Resource
      Council                                                            32
    Gatzemeier, Scott, Corporate Vice President, Front-End U.S.
      Expansion, Micron Technology...................................    41
    Mills, Mark, Executive Director, National Center for Energy
      Analytics......................................................    49

              ALPHABETICAL LISTING AND APPENDIX MATERIAL SUBMITTED

    American Clean Power Association:
        Letter for the Record........................................    91
    Barrasso, Hon. John:
        Opening Statement............................................     9
        Chart entitled ``U.S. vs. China: Cumulative Change in Coal
          Power Since 2015 Paris Agreement...........................    11
    Clean Energy Buyers Association:
        Letter for the Record........................................    93
    Electricity Customer Alliance:
        Letter for the Record........................................    95
    Fowke III, Benjamin G.S.:
        Statement for the Record.....................................    13
        Written Testimony............................................    16
        Responses to Questions for the Record........................    78
    Gatzemeier, Scott:
        Statement for the Record.....................................    41
        Written Testimony............................................    43
        Responses to Questions for the Record........................    84
    Manchin III, Hon. Joe:
        Opening Statement............................................     1
        Chart entitled ``Total Manufacturing Construction Spending:
          U.S. vs. EU, Percentage Change''...........................     2
        Chart entitled ``NERC: 5 U.S. Regions at Elevated Risk of
          Outages This Summer''......................................     5
        Chart entitled ``Wind Capacity Additions (GW)''..............     7
    Mills, Mark:
        Statement for the Record.....................................    49
        Written Testimony............................................    51
        Responses to Questions for the Record........................    88
    Onaran, Karen:
        Statement for the Record.....................................    32
        Written Testimony............................................    34
        Responses to Questions for the Record........................    80
    Risch, Hon. James E.:
        Opening Statement............................................    12
    (The) Williams Companies, Inc.:
        Statement for the Record with attachments....................    97
    Zero Emission Transportation Association:
        Statement for the Record.....................................   127

       THE OPPORTUNITIES, RISKS AND CHALLENGES ASSOCIATED WITH GROWTH IN
                 DEMAND FOR ELECTRIC POWER IN THE UNITED STATES

                                  ----------

                             TUESDAY, MAY 21, 2024

                                           U.S. Senate,
                     Committee on Energy and Natural Resources,
                                                        Washington, DC.
        The Committee met, pursuant to notice, at 10:02 a.m. in
    Room SD-366, Dirksen Senate Office Building, Hon. Joe Manchin
    III, Chairman of the Committee, presiding.

              OPENING STATEMENT OF HON. JOE MANCHIN III,
                    U.S. SENATOR FROM WEST VIRGINIA

        The Chairman. The meeting will come to order.
        Today we are here to discuss the opportunities, risks, and
    challenges associated with the growth in demand for electric
    power in the United States. In the half century after World War
    II, demand for electricity grew steadily in this country, along
    with our economy, but in the decade following the
    implementation of the North American Free Trade Agreement,
    which was in the 1990s, annual electricity demand growth fell
    by nearly 45 percent--45 percent. And for the past two decades,
    electrical demand--or ``load''--has been flat across the
    country.
        We are here today because that era appears to be coming to
    an end rapidly. With exponential growth in the domestic
    technology and manufacturing sectors, utilities and grid
    experts across the country are telling us that electricity
    demand is poised for truly remarkable growth. Meeting this
    demand growth may prove to be one of the greatest challenges--
    and also opportunities--that we will face in 21st century for
    our citizens, our economy, and the defense and security of our
    country.
        I want to thank our witnesses for being here to share their
    perspectives on this historic load growth and what is at stake
    if we do not meet it. The load growth is being driven by three
    main factors as we evaluate it. First, it is the reshoring of
    industry and advanced manufacturing spurred by the Bipartisan
    Infrastructure Law, the CHIPS Act, and the IRA. Construction
    spending on manufacturing has more than doubled since we signed
    these bills--and I think you see this behind you--signed these
    bills into law as shown in the chart behind me.
        [The chart referred to follows:]
        [GRAPHIC NOT AVAILABLE IN TIFF FORMAT]

        The Chairman. This is unbelievable. Unbelievable. People
    don't realize how much is coming into the U.S. and how rapidly
    demand--that tells you the spread of energy that we need and
    what we don't have, maybe. So look, the EU has been flat as a
    pancake. Most of all, the world's been flat as a pancake, and
    here we are. We are seeing new factories to build advanced
    energy and semiconductor technology spring up practically every
    week.
        Second, it is a revolution in advanced computing
    applications, especially artificial intelligence and the rapid
    growth in data centers to provide the processing power needed
    for those technologies. And I understand that they just have an
    unquenchable thirst for power as far as the data centers. And
    third, it is the push to electrify technologies across multiple
    sectors, like the administration's push to flood the market
    with EVs, which I think they are way over their skis on, and I
    have been cautioning and warning them from day one.
        The North American Electric Reliability Corporation, or
    NERC as we know it, projects in its 2023 long-term reliability
    assessment that there will be 90 gigawatts of demand growth by
    2030. Put that in perspective. That is over ten percent of this
    peak of the U.S. electrical demand, which is about 750
    gigawatts. But even that number is likely conservative. NERC
    relies on data submitted in the previous year from industry and
    the forecast just keeps growing unbelievably faster than what
    they can keep up with.
        This is unbelievable. Last month, the Texas grid operator
    revised its 2030 load forecast from last year to add 40
    gigawatts of new expected load growth. One state. That is like
    adding the demand of the entire State of California to the
    Texas grid six years from now. That should be a wake-up call. I
    hope it is. We need to be prepared to meet this demand. Let me
    be clear: the load growth is an opportunity of a generation,
    and it is ours to lose.
        The reason we have the growth is that industries that will
    define the 21st century--chips, AI, advanced manufacturing--are
    tripping over one another to build in America. They are coming
    from all over the world, but there is no guarantee of success.
    To put it plainly, we can't be open for business if we can't
    keep the lights on.
        If America can't build the energy infrastructure needed to
    support these industries with reliable and affordable power, we
    will be forfeiting the opportunity to be on the forefront of
    technologies of the future and ceding control to China and
    other nations that we cannot necessarily trust. And right now,
    between the Administration's policies and our inability to act
    in Congress, it seems like we may be in the real danger of
    doing just that.
        We have heard from both FERC and NERC that our grid's
    reliability and affordability are at risk because we are
    retiring baseload dispatchable generation faster than we can
    replace it. They came in and spoke with me and told me that
    basically we are taking off dispatchable 24/7, whether it be
    coal, nukes, whatever it may be that we can depend on, and now
    even natural gas because of an environmental movement, trying
    to replace it with intermittent power. And they are very, very
    concerned across the board.
        NERC's summer assessment came out last week. These are
    brand new numbers, and they show half the country at elevated
    risk of blackouts this summer, as shown in this chart.
        [The chart referred to follows:]
        [GRAPHIC NOT AVAILABLE IN TIFF FORMAT]

        The Chairman. If you live in or represent one of these
    areas, tell them to watch out. They are going to be in trouble.
    The potential is great that they may be having rolling
    brownouts and even blackouts, and that should be concerning to
    everybody in this Administration and every Senator and
    Congressmember who represents those areas.
        Last July, NERC even added energy policy as a brand-new
    category of major risk facing our grid. When NERC, which is
    basically nonpartisan, says the policies that you are putting
    out in Washington--and only Washington can fix it--are
    basically putting us at risk, you should take heed. It is
    ridiculous that government action is creating new categories of
    grid risk instead of preventing the risk.
        As if to prove NERC's point, EPA recently finalized four
    new power plant rules that, as far as I can tell, aim to kill
    coal completely and stop natural gas from replacing it. It's a
    double-whammy. I don't know what they are thinking. These
    dispatchable resources are essential for reliability. And I
    have said this to them: the transition is going to happen, but
    you can't take something off before you have something equally
    as good if not better to replace it with.
        You might not like coal, but coal has built this country
    into what it is today. We are doing it better and cleaner than
    any place else in the world. And the transition is there, no
    one's fighting the transition. Just give us other jobs that we
    can do to take care of our families and make a living, and
    that's fine. The bottom line is, we don't have that technology
    yet. We are not there, but they are just damned to do it
    because of the political reasons. And that is what we are
    trying to make sure they understand, that it's not going to
    work.
        These dispatchable resources are essential for reliability,
    I have said, and if this Administration were serious about
    onshoring critical industries, the ones driving the load
    growth, they would not be in a race to take power offline, they
    would be racing to bring new generation on. But instead, it is
    getting harder and harder to admit and build new energy
    infrastructure and connect new generation to the grid. It just
    is. We now have 2.6 million megawatts of generation waiting an
    average of five years to connect. Think about that. So 2.6
    million megawatts waiting to go and nowhere to go with it.
        For example, in West Virginia, in my little state, we have
    one plant over 1,800 megawatts, a state-of-the-art, combined
    cycle gas plant with carbon capture. The cleanest it can
    possibly be. The cleanest. But the company's telling me they
    have to wait half a decade before they even get the green light
    to even start the permitting. It's unbelievable. And to be
    clear, these are not just problems for fossil plants. It is as
    bad or even worse for wind. I can't believe this chart. This is
    where wind demand, this is what's happening in wind, how far it
    has gone down. They can't connect. There is nowhere to connect.
        [The chart referred to follows:]
        [GRAPHIC NOT AVAILABLE IN TIFF FORMAT]

        The Chairman. Solar is doing much better because solar can
    get into the grid system faster. It's in areas where the grid's
    already there. Wind is coming in areas, whether it be offshore
    or whether it be somewhere out to where there is no grid system
    whatsoever, and they can't get there because they can't get
    permitting. And if the Majority Leader, Senator Schumer,
    believes that what was done cured all the problems, I got news,
    it didn't do it.
        American Clean Power just published their 2024 figures, as
    you can see. We are on pace to install less wind in 2024 than
    we did during the worst year of the Great Recession, as shown
    in the chart. Here was the recession coming out of it here. Now
    we are down to there. We have to make it easier to build
    generation pipelines and transmission lines to meet the moment,
    and that is why the permitting is needed so, so desperately.
        FERC finalized two rules last week, which in time may help
    build new transmission. But let me be clear, these rules are
    using the tools FERC currently has and are not a replacement
    for Congressional action. These rules help with one aspect of
    one part of a bigger set of the grid permitting problems. I
    know you all have looked into this, but as my friend Senator
    Hickenlooper said, ``They are a Band-Aid on Congress's
    inaction,'' which you are totally right, Senator.
        For example, the new rules took action on transmission
    lines within regions--transmission lines already within the
    regions, not for the interregional lines that truly have the
    most reliability and affordability benefits to offer. It didn't
    happen, did not affect them at all. And only if the rules prove
    durable in courts and under future administrations. They are
    all going to be challenged.
        I want to quote FERC Commissioner Clements two days after
    the rules came out--and she is retiring in June--and she said:
    ``Considerable work remains to be done both at the Commission
    and in Congress if we are to realize the modern electricity
    grid on which the continued vitality of the United States'
    economy and security increasingly depends . . . for some of
    these next steps, particularly in regional planning and
    permitting reform, Congressional action could be critical in
    providing direction and momentum to the commission.''
        And just so we are clear that permitting and transmission
    legislation is not a partisan priority, let me also quote Mario
    Layola, a senior fellow at the Heritage Foundation, who served
    in the White House during the Trump administration. He said,
    after FERC issued its new rules, ``Transmission expansion has
    only become more difficult. These are problems only Congress
    can solve.'' I have to say I couldn't agree more. There are
    critical permitting problems for all types of energy
    infrastructure that only Congress can fix, and I remain
    committed to addressing that.
        Myself and Senator Barrasso's team have been working
    diligently for quite a while. We finally have language. We are
    going to start sharing this language with everyone, so that
    people can see where we are and hopefully maybe we can all get
    our act together here. In fact, each of the industry witnesses
    before us today submitted testimony that speaks in stark terms
    to the permitting challenges facing new sources of electric
    supply and demand. I look forward to hearing more from our
    witnesses on this topic shortly.
        With this, I am going to turn to Ranking Member Barrasso
    for his opening remarks.

               OPENING STATEMENT OF HON. JOHN BARRASSO,
                       U.S. SENATOR FROM WYOMING

        Senator Barrasso. Well, thanks so much, Mr. Chairman.
    Thanks for holding today's important hearing. America's demand
    for electricity is expected to grow rapidly through 2030. In
    fact, we may be entering a period of sustained demand growth
    unlike anything we have seen since the two decades following
    World War II. As you said, Mr. Chairman, we cannot be open for
    business if we cannot keep the lights on.
        The biggest source of new electricity demand is expected to
    come from data centers. Data centers enable cloud computing,
    Bitcoin mining, and artificial intelligence. How we meet this
    growing demand for electricity will have serious economic and
    security consequences for our nation. The stakes couldn't be
    higher. In fact, many believe that the race for artificial
    intelligence with Communist China will be more consequential
    than the space race with the former Soviet Union. And the AI
    race has already begun.
        Data centers running artificial intelligence consume
    massive amounts of electricity. Some estimates suggest that
    electricity demand for these data centers will double between
    now and 2030. Whoever secures affordable and reliable electric
    power, China or America, will have a big head-start in the race
    for artificial intelligence. And right now, America is not
    positioned well.
        Our grid is already strained. For years, the North American
    Electric Reliability Corporation, NERC, has raised alarm about
    grid reliability. It has warned that the premature retirement
    of coal and natural gas-fired power plants has increased the
    risk for blackouts and brownouts in much of the country. Yet
    the retirements continue, and President Biden is making the
    situation worse.
        Last month, the Environmental Protection Agency issued new
    rules that will force the premature closure of even more coal
    and natural gas-fired power plants. These plants play a major
    role in ensuring electric reliability. They also help make
    electricity more affordable. President Biden doesn't seem to
    care at all. He wants the cost of complying with EPA rules to
    be high. He wants to force operators to shut down these plants
    before the end of their useful life. It is a disgrace.
        We cannot regulate our way to more electric generation.
    When it comes to data centers, the quality of the generation
    source is as important as the quantity of electricity
    generated. Now, I acknowledge wind and solar can help, yet they
    are weather-dependent. Batteries, too, can help. Yet batteries
    are expensive and can't provide power for extended periods.
    They also require vast amounts of minerals from China, from the
    Congo, from Indonesia, and other countries with horrible human
    rights and environmental records.
        We need a reliable, steady, and balanced supply of
    electricity. Nuclear, coal, natural gas, and hydropower can
    provide that. With demand poised to surge, it only makes sense
    to keep our existing power plants operating while also building
    new generating capacity. Our goal should be addition, not
    subtraction. Mr. Chairman, the 20th century was the American
    century. Which country will lead the 21st century is still up
    for grabs. Much depends on how America capitalizes on the
    potential of artificial intelligence. The president's
    opposition to coal, to natural gas, and even to hydropower, the
    fuels that generate 65 percent of our electricity, is a white
    flag. It is a surrender, an act of surrender to China.
        Mr. Chairman, this chart shows that China has added 262
    gigawatts of coal-fired electric generation since the Paris
    Climate Agreement in 2015.
        [The chart referred to follows:]
        [GRAPHIC NOT AVAILABLE IN TIFF FORMAT]

        Senator Barrasso. The red lines show how much China has
    added from coal-fired power plants to electric generation.
    Meanwhile, the United States has shut down over 100 gigawatts
    of coal-fired electric generation. What does this mean? It
    means that when China's AI developers need electric power, the
    Chinese Communist Party is going to make absolutely sure that
    they will get it, and they will get it from coal. When
    America's AI developers need power, will it be enough, will it
    be reliable, will it be affordable? Right now, under Joe Biden
    and the Democrats, the answer is no.
        The race for artificial intelligence is one America cannot
    afford to lose, and we cannot win this or any other race with
    China if we are unwilling to use the very energy sources that
    China is going to exploit to the fullest.
        Thank you, Mr. Chairman.
        The Chairman. Thank you, Senator. I would like to turn to
    our panel of witnesses. I am going to introduce you all and
    then I am going to go to Senator Risch, if I may.
        Mr. Ben Fowke, he is interim CEO and President of the
    American Electric Power Company, one of our home-state
    utilities in West Virginia. Ben, it's good having you here. We
    have Karen Onaran, President and CEO of the Electricity
    Consumers Resource Council. We have Mr. Scott Gatzemeier,
    Corporate Vice President of Front-End U.S. Expansion at Micron
    Technologies, and we have Mr. Mark Mills, back again, Executive
    Director of the National Center for Energy Analytics.
        At this time, I am going to turn to my friend, Senator
    Risch.

               OPENING STATEMENT OF HON. JAMES E. RISCH,
                        U.S. SENATOR FROM IDAHO

        Senator Risch. Well, thank you, Chairman Manchin. I
    appreciate that, and to Ranking Member Barrasso, thanks to both
    of you for holding what is really an important hearing today,
    which covers a lot of ground and underscores some real
    shortcomings that we have but that we can address.
        It is my privilege today to introduce to you a
    distinguished Idahoan, Scott Gatzemeier, who is Vice President
    of U.S. Expansion for Micron Technology. Micron Technology was
    founded in Boise, Idaho, and had a very humble beginning, to
    say the least. And it has grown today to be one of the top four
    semiconductor companies in the world. Idaho ingenuity drove
    this growth and continues to drive the company's innovation in
    advanced memory and storage technologies. Micron's advancements
    have given the United States a competitive edge in data
    storage, security, and supercomputing.
        However, all is not well in the semiconductor industry. For
    those of us that serve on the Foreign Relations and
    Intelligence Committees and who work in the national security
    lane, over recent years, we have heard over and over and over
    again the shortcomings of the semiconductor industry. And it
    was driven by the semiconductor industry following the siren of
    cheap wages and moving production offshore. This has caused us
    some real difficulties, and it is very much a national security
    problem.
        With semiconductors, I think everybody is aware, and no one
    more than the defense industry and the defense contractors, of
    how important microchips and semiconductors are in the
    construction of certain products. They are in everything now.
    They are in refrigerators, TVs, and in automobiles. But very
    importantly, they are in just about everything that we
    manufacture that has to do with defense. Thus, those of us who
    saw this came up with the CHIPS Act, a $52 billion addition to
    our budget to stimulate bringing this industry back to the
    United States. This was not driven by a desire to subsidize the
    semiconductor industry. It was designed to meet what was a
    great challenge in semiconductor production, and to bring it
    back here to the United States and close this gap in national
    security.
        It appears to me it's working. We thought it would. No one
    ever knows until you actually try it, but right now, this is
    happening, and Micron is leading the charge in onshoring chip
    production again. The company recently broke ground on a new
    fab in Boise, Idaho, and has plans to build four additional
    fabs nationwide. Mr. Gatzemeier, who brings more than 25 years
    of experience across fab engineering, operations, and
    technology development, is Micron's leading expert on domestic
    expansion. His experience and expertise position him to offer a
    unique perspective on how Congress and industry must rise to
    the challenge of returning the American-born semiconductor
    industry to the United States.
        A key component of meeting that challenge is sufficient and
    dependable energy. And it is no accident that companies like
    Micron continue to invest in Idaho. Our state's all-of-the-
    above energy policies and support for clean, reliable,
    affordable, always-on hydropower make it a prime location. This
    issue of national security and semiconductors fits very well
    with the subject of what we are talking about today because it
    does demand a tremendous amount of energy. And Mr. Chairman, I
    think you did a really good job of underscoring what the
    experts are telling us we are going to need for energy in the
    future.
        So Scott, thank you for being here today, and we look
    forward to hearing your testimony on this important issue.
        The Chairman. Senator Risch, thank you. I know you have a
    very, very important Foreign Relations Committee meeting that
    you have to be involved with coming up right now, so I am sure
    Scott will get you up to date as quickly as possible after you
    have to go.
        Senator Risch. Thank you.
        The Chairman. With that, let's start with our testimonies,
    and Mr. Fowke, you are first.

         STATEMENT OF BENJAMIN G.S. FOWKE III, INTERIM CEO AND
               PRESIDENT, AMERICAN ELECTRIC POWER COMPANY

        Mr. Fowke. Chairman Manchin, Ranking Member Barrasso, and
    Committee members, thank you for the invitation to testify at
    today's hearing.
        My name is Ben Fowke, and I serve as Interim CEO and
    President of American Electric Power Company. AEP is one of the
    largest electric utilities in the United States, serving
    customers across an 11-state footprint. We have a diverse
    electric generation fleet, and we own and operate the largest
    transmission system in the United States. This is a significant
    moment for our country, our industry, and our company. We at
    AEP are excited about the opportunities and challenges ahead of
    us as we meet the growing demand for electricity in our
    regions.
        Demand for electricity was almost flat for two decades. We
    are now beginning to see this trend reverse, driven by large
    customers such as industrial manufacturers, data processors,
    and others who require significant amounts of power. The
    efforts of Congress to support the development of these
    businesses have been remarkably successful and companies are
    now building and growing here in America because in part we
    have abundant and diverse energy resources and reliable and
    affordable power. However, in some areas of the country, the
    demand for electricity is growing faster than the available
    capacity. Just a few years ago, a large-scale industrial
    manufacturing facility might require 100 megawatts, or about
    enough to power 100,000 homes. A facility that size would
    typically be one-of-a-kind in a region and would be a major
    source of economic activity for that area. Now it is common for
    a single data center to require up to 15 times this amount of
    power for a single site.
        As technology evolves, power demand from data processing is
    expected to double nationwide in three years. One small example
    of this demand surge, Open AI's Chat GPT, requires 2.9 watt-
    hours for a request. Now that is nearly ten times more power
    than a typical Google search. AEP currently has requests from
    large customers that would more than double the existing peak
    demand we serve on our system today.
        It took over 100 years of planning and building to create
    our current system, and a step-change in infrastructure
    investment on an accelerated timeframe will be required to
    serve even a fraction of this future demand in a reliable
    manner. As demand is rapidly increasing, our nation's
    electricity system is transforming to accommodate new forms of
    energy. The pace of this transformation must not overtake the
    reliability needs of our system. Independent assessments by
    NERC find that the risk of electric power supply disruptions
    are steadily increasing. Our society depends on a reliable
    power system. As we embark on this era of economic growth and
    technological transformation, customers need an energy system
    that is available to deliver reliable, affordable, and
    environmentally sensitive power where and when they need it.
        Continued development of the electric system must be a
    central priority of U.S. energy and economic policy, and we
    need to think bigger and more comprehensively to address the
    many opportunities and challenges in front of us. For your
    part, we ask that Congress work with regulators to ensure
    electric system resource adequacy and prevent premature
    retirements of dispatchable power plants. This includes
    considering the impact of recent EPA regulations, which could
    hasten the pace of plant retirements and diminish reliability;
    collaborating with FERC and other federal and state
    constituents to evaluate the establishment of a central
    planning authority focused on reliability; and directing FERC
    to ensure that viable reliability safety-valve mechanisms are
    in place to prevent premature plant retirements.
        Congress should also expedite the development of new 24/7
    dispatchable and clean energy resources to meet the growing
    consumer demand. This could be done through encouraging FERC to
    allow for fast-tracking of generation resources in the
    interconnection queues that have been selected by utilities to
    meet their obligation to serve customers; encouraging the
    development of advanced technologies such as next generation
    nuclear; passing a siting and permitting package that
    accelerates the development of critical infrastructure; and
    maintaining the Inflation Reduction Act and the technology-
    neutral and nuclear tax credits, which serve to reduce costs
    for customers.
        Finally, Congress should encourage FERC's recent efforts to
    support the efficient development of necessary regional and
    interregional electric transmission facilities to ensure
    reliability and accommodate economic growth and development.
    The electric power industry will play a crucial role in helping
    the U.S. remain a global leader in advanced manufacturing and
    technology innovation. With the help of Congress and our
    federal and state regulators and agencies, we can serve this
    emerging demand and secure America's role as a leader for
    generations to come. To do so, we will need to work together to
    quickly build new sources of electric generation and high-
    voltage power lines to deliver electricity where it is needed.
        Thank you.
        [The prepared statement of Mr. Fowke follows:]
        [GRAPHIC NOT AVAILABLE IN TIFF FORMAT]

        The Chairman. Thank you.
        Ms. Onaran, we have you next, if you will.

       STATEMENT OF KAREN ONARAN, PRESIDENT AND CEO, ELECTRICITY
                       CONSUMERS RESOURCE COUNCIL

        Ms. Onaran. Chairman Manchin, Ranking Member Barrasso, and
    distinguished members of the Committee, thank you for the
    invitation to appear before you today.
        My name is Karen Onaran. I am the president and CEO of the
    Electricity Consumers Resource Council, or ELCON. ELCON is the
    trade association for large industrial consumers of
    electricity. Our mission is to ensure that we have reliable and
    affordable power, and so we support the development and
    adoption of rational and coordinated policy to ensure electric
    reliability at low cost. The purpose of my testimony today is
    to represent the industrial sector as one of the drivers of the
    electricity demand that we are speaking of today.
        So after decades of decline in manufacturing, domestic
    manufacturing is seeing a resurgence in the U.S. According to a
    recent report from the Deloitte Research Center for Energy &
    Industrials, the number of manufacturing facilities in the U.S.
    grew by over 11 percent between the first quarter of 2019 and
    the second quarter of 2023. Construction spending on
    manufacturing has nearly tripled since June 2020 and was up 37
    percent year over year in January 2024, when construction
    spending reached a high of $225 billion. As a result, the
    industrial sector is projected to add 36 gigawatts of
    additional power by 2030. Bringing manufacturing back to U.S.
    shores has many implications and benefits, as we have talked
    about. This is bringing investment into communities that have
    been neglected in the past, bringing thousands of jobs, whether
    that be through construction, the permanent jobs to run the
    operations and manufacturing, and the secondary jobs to support
    those workers, including retail and food and housing.
        According to the National Association of Manufacturers, the
    industrial sector contributed at a yearly rate of $2.9 trillion
    to the U.S. economy in the third quarter of 2023, and it
    projects that we will need approximately 3.8 million
    manufacturing workers in the next decade. We have already heard
    about the national security implications. We can no longer rely
    on hostile foreign nations to supply our critical
    infrastructure, our critical minerals, and our computing power.
    And we saw the devastating impacts during COVID of supply chain
    interruptions. It behooves us to create more and manufacture
    more here on our shores.
        So at this point, we must right-size our grid, and we must
    meet this demand by reducing some of the regulatory barriers
    that we are seeing. We all know the risks. We have heard them
    today, from varying energy supply to extreme weather like we
    saw in Houston last week. So we cannot take any options off the
    table right now. We need all-of-the-above resources, and we
    need the infrastructure to support those resources. We need an
    agile and flexible grid that can manage variable supply as well
    as variable demands. Demand is going to change their profiles.
        So we really, really implore this Committee and the
    Congress to pass significant permitting reform for transmission
    infrastructure and other energy infrastructure. We have seen
    that the Federal Energy Regulatory Commission has taken some
    measures to address interconnection backlogs and transmission,
    but we still have a lot more work to do. I really ask everyone
    to come to the table and work on solutions. Take nothing off
    the table now.
        And finally, even though we all appreciate and wish to be
    good stewards of the environment, the EPA rules that recently
    came out further complicate a tenuous situation on our grid.
    And so we cannot be further impeding our reliable and safe and
    affordable electricity. Electricity underpins our national
    economy, our national security, and the prosperity and
    ingenuity here in the United States.
        Senators, again, I thank you so much for your invitation. I
    will conclude my remarks and look forward to your questions.
        [The prepared statement of Ms. Onaran follows:]
       [GRAPHIC NOT AVAILABLE IN TIFF FORMAT]

        The Chairman. Thank you.
        Now we have Mr. Gatzemeier.

    STATEMENT OF SCOTT GATZEMEIER, CORPORATE VICE PRESIDENT, FRONT-
                 END U.S. EXPANSION, MICRON TECHNOLOGY

        Mr. Gatzemeier. Chairman Manchin, Ranking Member Barrasso,
    Senator Risch, and members of the Committee, thank you for the
    opportunity to testify today and represent Micron regarding the
    importance of affordable, reliable, and sustainable energy.
        I serve as the corporate Vice President for Micron's
    expansion in the United States. Micron was founded more than 45
    years ago in Boise, Idaho, in the basement of a dentist's
    office. Today, Micron is a world leader in design, development,
    and manufacturing of memory and storage technology. We have an
    expansive IP portfolio of more than 55,000 patents. We operate
    in 17 countries, and we have over 40,000 team members
    worldwide.
        Micron plans to invest $125 billion with the support of the
    bipartisan CHIPS and Science Act to build fabs in Onondaga
    County, New York and Boise, Idaho that will transform these
    regions and create over 75,000 jobs. We are also seeking CHIPS
    funding for our existing fab in Manassas, Virginia, and would
    be excited to host you or your staff on a tour.
        Washington has been focused on the vital role that
    semiconductors play in American economic and national security.
    Micron is the only manufacturer of memory. Our memory and
    storage products are essential to all computing and storage
    capabilities in phones, data centers, computers, and numerous
    other devices. Without memory, none of those devices would be
    able to operate and provide the remarkable capabilities that
    shape our modern world. Micron has an expansive memory product
    portfolio, from the DRAM chips that will be made in Idaho and
    New York to the NAND and NOR in Virginia, to Micron's latest
    product, high bandwidth memory, HBM3E.
        Our high bandwidth memory powers today's generative AI
    models by enabling them to break through data bottlenecks.
    Micron's HBM is the fastest, highest capacity, and 30 percent
    more energy efficient than other products available across the
    industry. As Micron manufactures, we have made significant
    efforts to reduce our consumption of energy, which is detailed
    in my written report.
        However, as the expansions of U.S. semiconductor
    manufacturing, new data centers, and other manufacturing in the
    U.S. have been highlighted, electric demand will grow faster
    over the coming years than it has in decades. For all those
    planned investments in U.S. manufacturing and data centers to
    actually work, the U.S. needs to modernize its grid and expand
    electricity generation capacity. When it comes to energy
    permitting, I am an Idahoan, and I will speak to the challenges
    that we face.
        The western U.S. produces an abundance of sustainable
    energy, including hydropower in the northwest, wind in Wyoming,
    and solar in the desert southwest, but capacity is constrained
    on the transmission lines that move energy from the places
    where it's generated to the homes, farms, and businesses that
    need it. There is no transition to sustainable energy without
    transmission. To power our fab in Boise, we plan to import 400
    megawatts of affordable, reliable power from the Pacific
    Northwest in the summer, when a surplus of energy is available
    there. In the winter, when the Pacific Northwest energy demand
    peaks, utilities there will import energy across the planned
    Boardman to Hemingway (B2H) transmission line from Oregon to
    Boise.
        B2H began in late 2006. Idaho Power has a Record of
    Decision but does not have a Notice to Proceed from the Federal
    Government. The cost to build B2H is between $1.5 and $1.7
    billion. On top of that, permitting costs have already exceeded
    $220 million. Construction is finally slated to begin later
    this year, with completion in 2027, over 20 years after this
    project began. A federal permitting process that adds two
    decades to the project timeline and adds hundreds of millions
    of dollars in the cost is not a permitting process that will
    enable a U.S. manufacturing renaissance or AI leadership.
        Above all, Micron supports efforts which will ensure
    affordable and reliable electricity, which could include a
    balanced approach to permitting reform that utilizes all
    avenues to support the growth of domestic manufacturing,
    improves reliability of the grid, maintains low energy costs,
    and addresses the need for sustainable energy sources.
        I will leave you with this: Micron's main product is memory
    chips. It is an intensely competitive and dynamic business.
    Micron succeeds because we provide an edge, often in power
    requirements or better performance metrics, but we have been
    growing and planning to grow and invest to meet our customers
    in the digital economy. It is imperative that Congress also
    plan for the energy demands of the data-driven economy of today
    and tomorrow so the United States can remain competitive and a
    destination for manufacturers like Micron.
        Thank you, and I look forward to your questions.
        [The prepared statement of Mr. Gatzemeier follows:]
       [GRAPHIC NOT AVAILABLE IN TIFF FORMAT]

        The Chairman. Thank you. And now we will hear from Mr.
    Mills.

    STATEMENT OF MARK P. MILLS, EXECUTIVE DIRECTOR, NATIONAL CENTER
                          FOR ENERGY ANALYTICS

        Mr. Mills. Good morning. Thank you, Chairman Manchin and
    Ranking Member Barrasso for the opportunity to testify. And
    Senators, if I may, as a personal observation, as a longtime
    observer of this great Committee and occasional witness, just
    note that it's music to my ears, I will have to say, to hear
    such significant bipartisan convergence on such a critical
    issue.
        It is of personal interest, because I began my career as a
    young physicist in semiconductor fabs in New Jersey and Ohio.
    And we are, as you said, Senator, at a rare pivot in history.
    We are witnessing the emergence of a significant and ostensibly
    unanticipated new vector for electricity demand. And as you
    know, I am referring specifically to the emergence of useful
    artificial intelligence (AI), especially when it's combined
    with the next phase of expansion for the cloud computing
    infrastructure that was pioneered in the United States and has
    expanded to the world.
        While there is debate, of course, and outright guesswork
    about where the future specific uses for AI will come from--
    both civilian and military--no one doubts that the AI boom is
    here. Utility planners and energy pundits have rediscovered a
    basic truth--the arrival of new ways to boost the economy
    illustrates a longstanding correlation, a kind of iron law that
    links growth with rising energy use and especially electricity
    use. We have a good idea why we are now seeing such surprising
    leaps in the near-term forecast for electricity demand.
        Put in monetary terms, not the physics terms that I grew up
    with, but in monetary terms, every billion dollars spent on
    data centers leads to over $60 million a year in electricity
    purchases. And last year, before the AI acceleration kicked
    into high gear, capital spending on U.S. data centers was
    running at over $100 billion a year. Now, the addition of AI-
    enabled hardware is accelerating both the rate at which data
    centers are being ordered, and the energy use per data center.
    So a billion dollars spent on a new AI-infused data center will
    likely drive something like $200 million a year in energy
    purchases.
        Now, for context, a billion dollars spent on new EVs, for
    example, or a billion dollars' worth of new chip factories,
    generates only about $20 million a year in annual electricity
    demand. That AI has a voracious energy appetite is not news in
    the technical community. There have been myriad studies
    pointing out that the so-called ``training'' phase that is the
    equivalent of building, not flying, an aircraft, can use as
    much electricity as driving a Tesla anywhere from 300,000 to
    four million miles. And then the use phase--flying the AI, so
    to speak--can consume ten times more electricity. And there
    are, for all practical purposes, nearly unlimited numbers of
    potential applications for both training and using AI.
        Of course, AI will become more energy efficient. The latest
    AI chips are already a hundredfold more energy efficient over
    the last half-dozen years, and they will get another
    hundredfold more efficient before the year 2030. But efficiency
    won't solve the so-called problem of rising electricity
    demands. It will do the opposite, just as it did in the rise of
    the first cloud era. Improving energy efficiency lowers costs,
    which is what makes the proliferation of the benefits of the
    product or service possible, especially in digital domains.
        Operating at the computing efficiency of a 1980 computer, a
    single smartphone today, just one of them would use as much
    electricity as a skyscraper. A single data center would use the
    entire grid. It is because of electricity gains that the world
    has billions of smart phones and thousands of data centers.
    Consequently, today's global cloud infrastructure already
    rivals the energy use by global aviation, and that is before
    AI. We can count on the pattern repeating with AI.
        Electricity demand coming from the expansion of the cloud
    will continue to overshadow the combined impact of new EVs and
    new chip factories. But whether the AI expansion is in fact
    fully realized, and the expansion of chip factories and EVs as
    well in America, that will be determined, as other witnesses
    have said, on whether we have adequate electricity, whether
    it's affordable, and whether it's available when it's needed.
    And given the scales of electricity demand from the cloud, and
    AI particularly, when added to the demands from reshoring
    manufacturing and promoting EVs, the nation's electricity
    producers now need full access to all options. Electric power
    planning now needs to focus on additions to--not transitions
    away from--existing electricity production.
        The U.S. is the world's cloud leader today. We pioneered
    it. We pioneered AI, much as the U.S. was a dominant aluminum
    producer just 25 years ago. Producing, again in monetary terms,
    a billion dollars of aluminum requires purchasing some $400
    million of electricity, which today happens mainly on low-cost
    coal-fired grids in China, which has become the world's
    dominant supplier of aluminum, while the U.S. now has a single-
    digit percentage share of global aluminum supply. Aluminum and
    silicon are different materials and different industries, but
    the energy implications of the two domains, I suggest, has a
    relevant lesson for us.
        Thank you.
        [The prepared statement of Mr. Mills follows:]
        [GRAPHIC NOT AVAILABLE IN TIFF FORMAT]

        The Chairman. Thank you. And now we are going to start with
    our questions, and I will begin. I have so many questions, I
    don't know where to start to be honest with you.
        But first of all, I would ask you all, you heard about the
    rules that FERC came out with, and some people are thinking it
    took care of everything. Do any of you believe that what FERC
    did cleared or took care of our permitting problems that we
    have getting things built, especially transmission or getting
    pipelines built or any of the things we need? Anybody believe
    that it cured it? Nobody? Okay. And you know, we all understand
    it stays within the region, so all it did is allowed, if you
    have a regional transmission line, it applies there, but it
    does not take care of interregional, right? Okay, so we are on
    the same page there.
        We all agree with the charts that we had here? Let me just
    show you on this chart here.
        [The chart referred to appears on page 5 of this hearing
    document.]
        This chart shows that if you live in these areas or you
    represent any of these areas, coming this summer is where they
    are predicting you are going to have rolling brownouts or
    blackouts because demand will be so great. It doesn't account
    for the winter now. It will change around in winter when the
    load is different in the winter. We understand that. I would
    ask you, Mr. Gatzemeier--coming from the technology end of it
    where you are all looking to put your new databases and things
    of that sort--do you look at this, and finding out where you
    might have more reliable power, where you might go and
    recommend putting a plant or a center in an area where they are
    going to be reliable and not basically intermittent?
        Mr. Gatzemeier. Yes. Power reliability is incredibly
    important to our industry. A minor----
        The Chairman. Did that factor into basically making
    decisions on where you are located?
        Mr. Gatzemeier. Yes, yes it did. In fact, when you look at
    New York, one of the reasons why I made the decision to go
    there is there is a nuclear power plant 40 miles directly north
    of our facility with a direct-line connection to a 345-kV
    substation across the street from that site. And in looking at
    it, it was one of the most reliable substations on the grid
    when we were looking at where to select our site.
        So reliability of the system is incredibly important to
    semiconductor fabs, because a small millisecond blip in our
    power would take down our factory for up to a week by
    interrupting processing. So reliability is incredibly important
    to semiconductor fab manufacturing.
        The Chairman. I am going to put a chart that I used before
    on wind, and truly all of our environmental friends and
    everything are big on the wind thinking it's going to come.
        [The chart referred to appears on page 7 of this hearing
    document.]
        I know our Majority Leader is big on wind. Wind has hit a
    slump and it's going down because it takes so long to build
    transmission lines. Solar--it's easy to bring solar on. Solar
    is record high. Wind has dipped clear down to here. Do you all
    agree or disagree with this analogy of what happened to wind,
    because we can't get transmission built?
        What I am trying to make a point on is that we all have to
    have permitting reform, and we have worked on this Committee in
    a bipartisan effort. Mr. Mills, you pointed out, we all
    understand, we just can't get the Administration to understand
    how desperate that we are in need of this. Have you all had any
    contact with the White House, John Podesta's office, the
    climate department there about the need to get permitting done,
    to get the lines to be able to deliver the--have you had any
    input at all? Have they reached out to you at all?
        No? None? None of you? Have you tried to reach out to them
    and tell them how desperate we are of trying to get
    transmission and get things built? I would encourage you to do
    so if you haven't. Please do so and reach out to them.
        The other thing is on China. Do you believe that China has
    a competitive edge with the amount of power they have
    dispatchable to them? Mr. Mills, do you want to comment on
    that?
        Mr. Mills. Well, Senator, they have a profound competitive
    edge in low-cost, high-reliability, electric power, as you well
    know, and a profound competitive edge on exporting the critical
    minerals materials that we use to build our unreliable power.
        The Chairman. If we don't have the capacity, Mr. Gatzemeier
    back to the production end of it, with AI coming on so strong,
    if we are not able to keep pace and be the leader of the world,
    are we in jeopardy because of the lack of power that we have in
    our manufacturing?
        Mr. Gatzemeier. Yes, I think you said it, you can't run a
    business if you can't keep the lights on. We need additional
    generation, and so we encourage investigation in all sources of
    new generation, like new hydro, new nuclear, small modular
    reactors, geothermal, battery technology for wind and solar to
    make them more reliable, because our fabs run 24/7. So we
    encourage looking at all sources of generation and requiring
    new generation to be created before you retire existing
    generation.
        The Chairman. Mr. Fowke, if I could ask you, since I am a
    customer of yours.
        [Laughter.]
        Mr. Fowke. Thank you.
        The Chairman. Anyway, are you concerned about the amount of
    EPA regulations coming out in power plants that you are going
    to have to be closing more reliable power than what you intend
    to do?
        Mr. Fowke. Yes, very much so. The EPA is a big fan of CCS,
    and they think that is the best available technology. As you
    know, we had a pilot program to explore the carbon capture, and
    we have some experience with it and it has its challenges in
    front of us. And it's not a proven technology today, and nor is
    the infrastructure to move the carbon to sequester it
    available. So while it might be a viable technology, a proven
    technology in the future, it's not today, and it's unrealistic
    to expect that it will be available by 2032.
        The Chairman. Do you have any coal-fired plants that are
    being retired earlier than their time?
        Mr. Fowke. We will have to have that conversation with our
    commissions. They were not scheduled to be retired in 2032. And
    these rules--if you don't comply with these rules, you need to
    shut the plants down and that would be a premature shutdown.
        The Chairman. And also, for the record, on the premature
    shutdown, who continues to pay? Because your rate was based on
    the life of the plant, correct?
        Mr. Fowke. Correct.
        The Chairman. So it's based into the rate that West
    Virginians and anybody in your system are going to be paying
    for shutting down earlier and bringing on other power too. So
    it's a double-whammy for the most hard-pressed and challenged
    people, basically. It doesn't make any sense at all. No sense
    whatsoever, sir. I hope you speak up loud and clear and you put
    statements out--what is going to happen, and who's going to pay
    the freight.
        Mr. Fowke. We plan to do just that, Senator.
        The Chairman. Thank you, sir.
        Senator Barrasso.
        Senator Barrasso. Well, thank you. Just to follow up, Mr.
    Fowke--so, in 2021, you testified before a different committee
    in the Senate that ``renewable energy can only take us so
    far.'' You went on to say, ``at higher levels of intermittent
    renewables, the cost of the energy system begins to skyrocket,
    and the reliability degrades.'' Still true today?
        Mr. Fowke. Yes, I made that testimony when I was CEO of
    Xcel Energy, but that statement still holds true because it
    reflects the physics of the grid. I am a big proponent of
    renewable energy. I think it's part of the solution and it's
    part of how we address climate change and the risk of it. But
    the reality is, the more renewable generation you put on the
    grid, at some point that grid reaches saturation point, and
    then the value of that renewable energy diminishes and the
    integration cost increases. And it's the reality that the big
    grid that we are all part of needs 24/7 spinning mass
    dispatchable generation. And that's just a fact, and we have to
    accept that.
        Senator Barrasso. So it's dangerous to force all these
    natural gas and coal-fired plants offline at this point.
        Mr. Mills, let me go to you. What would be the consequences
    if federal and state regulators effectively prohibited the use
    of natural gas and coal to meet the growing demand for
    electricity?
        Mr. Mills. Well, in simplest terms, the stifling of
    economic growth and opportunity and the profound disadvantage
    geopolitically. You can only consume the energy you produce.
    And since all of the witnesses and all of the members of the
    Committee understand now that we have soaring demand and
    economically driven need for electricity, we would not get that
    growth without the power.
        Senator Barrasso. So, some argue that electric batteries
    will also play a big role in meeting the growing demand for
    electricity. They argue that rapid deployment developments in
    battery technology are going to enable us to store energy for
    longer periods of time at lower costs. What is your assessment
    of the state of battery technology, and what are the
    implications for the affordability of electric service if we
    rely significantly on these batteries?
        Mr. Mills. Well, I'll make a point--a technical point, a
    physics point: batteries don't produce energy, they store it.
    They are extraordinarily expensive ways to store energy. On an
    engineering/physics basis, roughly 100 times more expensive
    than the traditional ways to store energy--tanks, caverns,
    piles of coal. They will play, and are playing a very
    significant role in short-term stabilization. For long-term
    energy storage, the United States would have to deploy tens of
    trillions of dollars of batteries at scales that the world
    cannot now manufacture, nor produce the minerals for.
        Senator Barrasso. So let me follow up. So Jigar Shah, who
    is the head of the Department of Energy's Loan Programs Office,
    recently argued that the projected growth and demand for
    electricity that we have all talked about and has been reported
    broadly in the press, he said that is significantly overstated.
    He claims many large energy users can control when they need
    electricity. He said they might agree to stop using power
    during times of peak demand. He also said that individuals will
    stop using electricity during times of high demand in response
    to high prices.
        Mr. Mills. Right.
        Senator Barrasso. In your view, will this be enough to
    address the growing demand for electricity? And if not, why
    not?
        Mr. Mills. Well, first another physics point. Demand-side
    management does not produce energy. It is avoiding the use of
    energy. Economic growth requires more energy. Also, utilities
    have been very, very good at managing demand for about a
    century. It's not a new discovery in the utility industry. I
    would say the principal discovery is that our society is more
    electrified and that there are fewer and fewer sources of
    ``low-hanging fruit'' where we would turn to.
        And I will pick on Micron because they are a spectacular
    company, where you would turn to them when they are running
    their factory, who will tell us, as the fabs I worked in, if
    you take power away for milliseconds, you cause astonishing
    economic destruction. I have had that happen to me when I ran a
    fab as a young man. So you don't get to ask them to please turn
    it off right now, the wind isn't blowing and our batteries have
    run out, because when you have a four-hour battery, at four
    hours and one second, you are black. You don't have a pile of
    coal nearby. You don't have more electricity if there is wind
    lull and it's cloud covered.
        It is not a solution, but it is a tool in managing cycles.
    Society is cyclical. Humans are cyclical. So peak demands can
    be shaved, but they don't produce energy.
        Senator Barrasso. Well, since you turned to Micron, let me
    turn to Micron. I understand that both the availability of
    electric service and the quality of the electric service that
    you get are incredibly important to Micron. What is the impact
    of the temporary voltage dips that we just talked about on
    facilities like yours?
        Mr. Gatzemeier. Yes, I also unfortunately have had the
    opportunity to recover a fab from a minor power blip--
    milliseconds, you know, tens of millions of dollars of product
    loss in that fab recovery. This would be on the order of
    hundreds of millions of dollars product loss on these other,
    you know, larger facilities that we will be building. So
    absolutely a large economic impact.
        And while we are putting in all sorts of energy savings
    types, opportunities--variable speed drives, heat capture
    recovery--we are putting all that in to try to lower our
    demand, the ability to fluctuate, we are what we call a
    baseload. You know, we run 24/7, 365 on all the time at peak
    out, and you can't just shut it off.
        Senator Barrasso. Thank you, Mr. Chairman.
        The Chairman. Senator Cortez Masto.
        Senator Cortez Masto. Thank you. Thank you, Mr. Chairman
    and the Ranking Member. I am one of those that believes we
    still need permitting reform. And Ms. Onaran, let me start with
    you, and I want to express my appreciation for ELCON's
    endorsement and support of one of my bills. It is the
    Expediting Generator Interconnection Procedures Act--EGIPA--for
    short.
        I was pleased to see your testimony call on Congress to
    consider this legislation as soon as possible, really in order
    to ease what we are talking about--interconnection, backlogs,
    enhance grid reliability, and lower energy costs. As we have
    all been talking about and are aware, Lawrence Berkeley
    National Lab recently determined there were over 2,600
    gigawatts of generation in storage pending in U.S.
    interconnected queues at the end of 2023.
        Ms. Onaran, can you talk a little bit about why--expanding
    on some of the ways--that this legislation works to alleviate
    the bottlenecks, and it will have a positive impact on energy
    development and grid resiliency?
        Ms. Onaran. Yes. Thank you for the question, Senator.
        And yes, ELCON was a supporter of that proposed bill. We
    are at a point where we need, again, as my testimony stated,
    all of the above resources. We have a lot of resources that are
    hung up in the interconnection queue that are ready to put
    steel in the ground and start producing power. And
    unfortunately, due to regulatory constructs in the markets,
    these are being held up through red tape and, you know,
    restudies, and so we really need to find a way to standardize
    and perhaps automate some of these study processes so that we
    can do it more quickly, and get these resources on the grid.
        FERC has done some work with their Order No. 2023, but we
    still need to go further, and it's just the first step. Thank
    you.
        Senator Cortez Masto. Thank you. And while I have you,
    because you mentioned this, and this is always a concern of
    mine because I think as we build out our portfolio around
    energy, including clean energy, we need to ensure we have a
    workforce.
        Ms. Onaran. Yes.
        Senator Cortez Masto. And you talked a little bit about it.
    So when considering the severity of literally growing and
    moving forward in clean energy and all of these projects, what
    do we need to be thinking about for that workforce?
        Is it there, or should we be putting more investments, and
    what type of investments in the workforce?
        Ms. Onaran. Yes, absolutely. You know, coming from the
    utility side, before I joined the consumer side, that was
    something we heard from the utilities quite a bit, that the
    workers, to come, even managing our electric system, the same
    for manufacturing, you know, trade schools, things like that
    have, you know, declined. There was a more prominent focus on
    say, you know, liberal arts education. We moved away from sort
    of the trade education that we need. We need to encourage more
    workers to look at some of these new and emerging jobs. We need
    to make sure that they are well paid, we need to make sure that
    they can exist in this society and can prosper. And so we
    really need to be investing in our future workforce, and we
    need to start doing that now.
        Senator Cortez Masto. Thank you. Mr. Fowke, are you
    familiar with advanced reconductoring?
        Mr. Fowke. Yes, very much so.
        Senator Cortez Masto. Can you talk a little bit about that?
    Because there is an opportunity, as we are talking about
    building out the grid and transmission, the technology is also
    going to help us with capacity. Isn't that correct? So can you
    talk a little bit about that?
        Mr. Fowke. Yes. It's a grid-enhancing technology. We
    actually have just used it a couple years ago down in South
    Texas where we used the advanced conductor technology to--I
    think a 330-mile transmission line of 345-kV. And to your
    point, it increased capability by about 40 percent. I would
    caution though that you do have to find specific applications
    in specific regions and a lot of other technical things before
    it can produce those sorts of results that I mentioned. But we
    have been a very big proponent of grid-enhancing technologies,
    making sure that they also have a cost benefit, you know,
    favorably score out on that. And when they do, we are all in.
        Senator Cortez Masto. Are other countries already using
    this type of technology, advanced reconductoring?
        Mr. Fowke. Are other utilities?
        Senator Cortez Masto. Countries.
        Mr. Fowke. Countries? I believe so, but I would have to
    check with my team to see how extensively they are.
        Senator Cortez Masto. I appreciate that. Thank you. Thank
    you, Mr. Chairman.
        The Chairman. Thank you.
        And now we have Senator Cassidy.
        Senator Cassidy. Mr. Fowke, the Chairman just reminded me--
    do you also have that coal-fired plant in Shreveport,
    Louisiana, or did you all shut that down?
        Mr. Fowke. I believe that has been shut down.
        Senator Cassidy. So the Chair just reminded me that my
    ratepayers in Louisiana are still paying for that----
        The Chairman. Absolutely.
        Senator Cassidy [continuing]. Because it did not go to its
    life, so when we speak about higher energy costs, and they have
    risen significantly during this Administration, part of that is
    the kind of unrealized productivity of sunken assets. And let's
    be clear: that's regressive. That is regressive. Poor people
    pay a greater percentage of their income for this unrealized
    potential.
        But I will note, by the way, in Northwest Louisiana, and
    Louisiana, you guys and Cleco, I think, supply that area, and
    you all have great reliability. So I just also want to give you
    a congratulations and a shout-out. Our state consumes a lot of
    energy, and you guys are providing reliable energy. So I
    appreciate that.
        Let me ask you this: I recently toured Sempra--building a
    little bit off of Senator Cortez Masto--Sempra in Southern
    California, and 100 percent of their electricity right now is
    being supplied by renewables. You just got to hand it to them.
    It's remarkable. Now, I don't think of Southern California as
    being huge in manufacturing, but there is more than I thought
    there was. Now, they admitted in another time of the year it
    would have a mix. But just to say, this kind of load balancing,
    it is possible, correct? I mean, as much as I believe in fossil
    fuel and the necessity for baseload, in a place like Southern
    California with lots of renewables, et cetera, it is certainly
    possible, correct?
        Mr. Fowke. I will tell you, in all sincerity, they are
    connected to a big grid that somewhere has that dispatchable
    24/7, likely fossil fuel, that is supplying them. And you can
    stream renewables from different places, but at the end of the
    day, they are still connected to grids that have fossil
    capability on that.
        Senator Cassidy. So I was struck that Micron located
    downstream from a nuclear power plant. And that was one of the
    reasons you did that. Somehow, I think state subsidies had a
    role to do with it, but that's okay. You know, we will leave it
    at that. So for that ``always got to be on,'' even if you are
    like this great utility in Southern California, in which at
    that time they were using 100 percent renewables, you've still
    got to have that baseload.
        Mr. Fowke. Absolutely. And you know, that nuclear power
    plant, I assume, is not behind the meter of Micron. It's on the
    grid, so it's supplying its resources to the entire grid for
    the benefit of many customers, not just Micron.
        Senator Cassidy. Okay. Thank you.
        Mr. Mills, going to permitting reform. I have been
    interested in the judicial review aspect of permitting reform.
    Any comments on that?
        Mr. Mills. Well, I think, as you well know, Senator, one of
    the big challenges for large manufacturers of any kind is that
    the permits are effectively in an infinite period of potential
    review, judicial and other forms of review, which is why we see
    exactly the kind of challenges, especially to the transmission
    line--in Idaho--the same was true in Maine, where I spent my
    summers, a transmission line that just never got built.
        Senator Cassidy. So again, the Chairman knows how lawsuit
    after lawsuit can effectively tie up something and effectively
    kill the project. So I like to say that the folks on the other
    side of the dais want powerlines, and the folks on this side
    want pipelines. But we really want both because we know that
    both are essential. So is it fair to say that the permitting
    reform that would benefit both power and pipe are the same ones
    that would benefit pipe and power?
        Mr. Mills. Well, yes sir. That would be a terrific outcome,
    to accelerate the permitting of both, because the world cannot
    operate without both.
        Senator Cassidy. Got you. Sir, I know that Micron has had
    development in China. I just know that because the Chinese have
    been somewhat non-cooperative with your economic development
    there. Is the power source there coal? Or what is the typical
    source that you get there?
        Mr. Gatzemeier. I don't know what the power source is for
    our back-end facility, but at Micron, we are one of very few
    semiconductor manufacturing companies that do not have front-
    end manufacturing in China.
        Senator Cassidy. That do not have what?
        Mr. Gatzemeier. Front-end. We don't have a fab in China.
        Senator Cassidy. Got it. I want to point out that I just
    learned this, that I think 60 percent of Chinese power is
    generated by coal. They typically don't turn on their scrubbers
    because that decreases the efficiency. Oftentimes, they are
    built on the Pacific Coast, which means the trade winds blow
    them over to the United States. So, to the degree that our
    energy policy increases the cost of energy and therefore
    encourages someone to move to China, we are actually worsening
    global greenhouse gas emissions because we are increasing
    consumption of Chinese coal-fired electricity as opposed to
    clean-burning U.S. electricity, be it renewables, nuclear, or
    natural gas.
        And natural gas has accounted for a decrease in absolute
    emissions in the United States, less than I think now, well,
    certainly 2005--you guys will tell me it's probably even
    earlier--despite a bigger population, a bigger economy, and
    more electricity usage. I say all that, and I yield back, Mr.
    Chair.
        The Chairman. Right on, brother.
        [Laughter.]
        The Chairman. We have Senator Cantwell now.
        Senator Cantwell. Thank you. Thank you, Mr. Chairman. Thank
    you for highlighting the success of the CHIPS and Science Act.
    This breakthrough legislation is on track to triple domestic
    chip manufacturing capacity by 2032. So we should be excited
    about that. And thanks to the Act, that is the largest
    percentage of semiconductor growth rate in the world, so I
    can't emphasize how important that is, and many people here
    played a big role in supporting that.
        But we have the same issues as the Chairman mentioned in
    the Northwest. The Northwest Power and Conservation Council
    calculates that the region will need 3,500 megawatts of
    renewable generation by 2027 and 14,000 additional megawatts by
    2040. I think it's a DOE estimate that puts the Pacific
    Northwest in a need of 56 percent more transmission capacity by
    2040.
        So we are very proud of our AI, cloud computing, all of
    that, but we have to figure out what we are going to do about
    the power need. You mentioned hydro, so I wanted to ask you
    about what you think the priorities there for hydro relicensing
    should be. Do you think we need a tax credit to help spur
    baseload, keep baseload power in place? And what other things
    do you think we need to do in the transmission capacity that
    would be interesting for your next phases of production?
        Mr. Gatzemeier. So first, I mean, we are fortunate to
    operate in Idaho, where we have a lot of access to hydro in the
    Pacific Northwest generation. And then we will be operating in
    New York, where again, there is additional hydro, you know,
    access. So it's absolutely a good source of, you know,
    sustainable energy that we should be continuing to invest in.
    But I would also say we need to be looking at all sources of
    sustainable energy--looking at nuclear, small modular reactors,
    investing in that, investing in improved battery storage
    technology for wind and solar, which we have discussed here as
    well. And then geothermal and other sources. Any additional
    generation that we can get is critical.
        And then for the grid in the Pacific Northwest, I mentioned
    the B2H transmission line, getting that put in place and
    interconnecting, you know, Washington, Oregon, and Idaho more,
    to where there could be seasonal demand fluctuation and
    differences in generation being able to share. That's how that
    transmission line is going to be critical for the Pacific
    Northwest in enabling interconnectivity.
        Senator Cantwell. Well, just to make clear, there are some
    savings, right? I mean saving, I think it's like one-third or
    one-fourth the cost to basically save an electron than it is to
    produce one.
        Mr. Gatzemeier. Yes.
        Senator Cantwell. There is some capacity to build into the
    grid on smarter technologies that would help us in moving power
    around where we need it.
        Mr. Gatzemeier. Yes. And when you look at the availability
    of power from lower-cost sources during different seasonality,
    and then also you look at the cost of an asset, if you will, of
    a generation source that sits idle because wind or solar are
    running at that time, if you could send that power somewhere
    else to where it could be utilized as a lower cost, that could
    help savings as well.
        Senator Cantwell. What about the tax credit idea? We
    already have it for wind and solar. Why not for hydro?
        Mr. Gatzemeier. You know, one thing I will say, in New
    York, they introduced zero-emission credit (ZEC) for their
    nuclear power plants that they had, to work on, effectively,
    maintenance activity that they had with their nuclear plants to
    keep them online and running. So to continue hydro plants
    funding, that could be a program that you could look at and
    follow potentially.
        Senator Cantwell. Okay. And what about other sources of
    energy for the future? You mentioned battery technology. You
    didn't mention fusion, but we have three fusion companies going
    to work in Everett, Washington. Do you think that there are
    some other things that Micron is looking at as we think about
    these data centers and AI integration into the grid?
        Mr. Gatzemeier. Yes, I mean, we produce semiconductors, not
    energy. We are a consumer of energy, but I will say that we are
    working to innovate in our factories to lower our consumption,
    and then also our products. You know, it takes power to make
    our chips, but then it's also about the power our chips use
    after they get out in the data centers. So every generation of
    our technology, we are working to reduce the power that they
    consume. Since 2011, we have done a 10X reduction in our power
    consumption of our chips. And as I mentioned, our high-
    bandwidth memory is 30 percent more energy efficient than other
    competitors' products on the market. So we are working to
    effectively reduce our energy consumption in those ways.
        Senator Cantwell. And, I don't have enough time, but that
    is monumental success, right? And when you think about
    driverless cars or other applications, it's an immense amount
    of energy and memory that is required. So thank you.
        Thank you, Mr. Chairman.
        The Chairman. Thank you, Senator.
        And now we have Senator Murkowski.
        Senator Murkowski. Thank you, Mr. Chairman. I want to
    follow on the comments from Senator Cantwell about hydro. Now,
    just thinking about what we have in place with the hydro
    production in this country and how it has provided us that
    great baseload--wonderful. We can do more. We know we need to
    be doing more, but when we are looking at the number of hydro
    facilities that are now up for relicensing, and recognizing how
    much it costs to relicense and how long it takes to do it, you
    know, what's to say that we are not going to have some of these
    facilities that are just like, not worth the time nor the
    energy, and it goes back to the permitting, but it is something
    that I think, as we think about our energy demands, we have got
    to have some better projection here.
        I was in a Defense Approps hearing not too long ago, and we
    were talking about PACAF's number one priority at JBER in the
    Anchorage area there. It is a training facility, and they just
    very casually say that it's going to increase JBER's power
    requirements by roughly 50 percent. And you're thinking about
    what that means. This is in an area of the state where we are
    talking right now about importing LNG from Canada because our
    LNG reserves in Cook Inlet are going down.
        So we are thinking about what it's going to mean. Are we
    going to be seeing brownouts? What's happening? Where are we
    going to get this resource? We have got a Governor that is now
    saying we are going to go back to coal. I mean, there is more
    than a little bit of panic and anxiety. We had our legislature
    just shut down just last week. But so much of the focus has
    been on our energy and the increased consumption, the increased
    demand here.
        So a question for probably Mr. Fowke and Mr. Mills, this
    anticipated energy demand, we see the forecasts in filings by
    the RTOs over the last couple years. But EIA's latest 2023
    Annual Energy Outlook only forecasts demand would grow by about
    one percent on average from 2022 to 2050. I cannot even begin
    to think that that is reasonably or remotely sane. It's not the
    world that we are living in, and we are seeing this every
    single day.
        What is the discrepancy here in terms of the forecast,
    whether it's from EIA or the RTOs? Is the problem in how they
    are collecting the information? The forecasting issues--we have
    got to get a better handle on what's coming down the pike here.
        What do we need to do?
        Mr. Fowke. Well, I don't know where EIA is getting their
    information. That sounds like a forecast that maybe would have
    been accurate four years ago----
        Senator Murkowski. Maybe.
        Mr. Fowke [continuing]. But not with what we are seeing.
    Not with what we are seeing in today's world. I mean, in
    central Ohio, we are going to double our capacity in five
    years. And we have talked extensively about the amount of
    demand we are seeing. I think one thing that has to happen
    within the RTO structures is, it is incumbent upon us as a
    utility to get the updated forecast in a timely manner so they
    can have full information.
        Senator Murkowski. Do you think that they are collecting
    the right data in order to give you a forecast that is
    accurate?
        Mr. Fowke. Well, the RTOs typically collect their data from
    their members. So we need to tell them how much load we are
    seeing. And then of course, there is a risk adjustment process
    and how much of that is actually, you know, serious, how much--
    maybe it's duplicate, et cetera. But we are working very
    closely with them to get those forecasts right. And they are
    recognizing it.
        And you are starting to see it, Senator, in what is
    happening with the pricing of capacity, for example, in the PJM
    market. A three-year capacity window does not encourage the
    capacity that needs to be built for a 30-year time frame. But
    we are starting to see change.
        Senator Murkowski. Mr. Mills, do you want to comment on
    this?
        Mr. Mills. I think the fundamental problem is the obvious
    one--it's hard to predict the future, but one thing we do know
    we can predict is that innovation occurs in episodes. There are
    interregnums.
        Senator Murkowski. Well, okay, but talk to me, because we
    just passed the CHIPS Act a couple of years ago. We know that
    is coming, right?
        Mr. Mills. Correct.
        Senator Murkowski. So how are we incorporating what we know
    legislatively, what we know from an appropriations perspective
    we should see coming our way?
        Mr. Mills. Well, Senator, I would say this is blowing my
    own horn, as they say, but when the CHIPS Act was passed, I did
    write and did testify for the Committee that the effect of that
    would be to radically increase electricity demand, because chip
    fabs--in fact, in Taiwan, 20 percent of the entire country's
    electricity is used to build semiconductor chips. And in
    Ireland, because it's a data center hub, 20 percent of the
    entire country's electricity is to run data centers. This was
    predictable. It was predicted in the technical literature.
        I am one of the players that tries to push it into the
    public policy domains. But we are told that we will see
    efficiency solve ``that problem.'' And what I have pointed out
    in my testimony and said for years is, efficiency does not
    solve the ``problem'' when you have net new demands from new
    innovation.
        Senator Murkowski. Right.
        Mr. Mills. The invention of the car led to the demand for
    gasoline, the invention of electric car, demand for batteries,
    the invention of chips, demand for electricity, and so on. So
    the hard part is that--and I have sympathy for the leaders of
    electric utilities and RTOs--they are stuck with trying to
    guess what innovators are doing in this market. They are stuck
    with guessing that a new Micron might show up one day.
        There aren't--I can promise you, as a student of this
    industry--there are hundreds of new Microns brewing in the
    country. Five or ten of them will succeed. In a very few years,
    they will demand astonishing amounts of energy and we will all
    act surprised. It's predictable that it will happen. What is
    hard to predict is exactly when, but it's not a century, it's a
    few years.
        And I will sort of close by saying that the demands, as we
    have discovered, occur faster than we can get permits to build
    power plants or relicense hydro dams. And this is the part that
    has to be resolved, the incommensurate velocity of what we want
    for growth--we won't get it--and what we don't want to permit.
    And it doesn't matter whether it's transmission lines for wind
    or the gas turbines and the pipelines for the gas turbines.
        Senator Murkowski. Thank you.
        Thank you, Mr. Chairman.
        The Chairman. Thank you, Senator.
        And now we have Senator Hickenlooper.
        Senator Hickenlooper. Thank you, Mr. Chair and Ranking
    Member Barrasso. I have and continue to support your bipartisan
    efforts to----
        The Chairman. Now we have got contents for you. We are
    going to have everything at your desk.
        Senator Hickenlooper. Okay, well, I'm ready. I am looking
    forward to it. I support that permitting reform and will assist
    any way I can. Obviously, we need to accelerate all the points
    that you all are making. And it's far beyond whether someone is
    on one side or the other of the climate change debate. The
    world is changing so rapidly, and a big part of the ability to
    respond to the greater need is going to be our ability to move
    electricity from one place to another.
        I will start with Ms. Onaran. How would you say,
    specifically, and just provide a couple of examples of how
    permitting delays impact your members and their ability to
    grow.
        Ms. Onaran. Right, thank you. Yes, so, you know, we are
    looking into communities, as is Micron. We are looking for the
    reliable, we are looking for states and regions that are open
    to infrastructure expansion, that are not shutting those
    conversations down. The permitting, of course--when we delay
    getting that infrastructure in the ground, we cannot expand our
    operations there because we will not be able to reliably
    support our operations. We need to have that infrastructure in
    place. The longer it takes to permit, we either move to a
    different state or we do not expand. And so we are curtailing
    our economic prosperity by delaying this permit and getting
    that infrastructure that we need.
        Senator Hickenlooper. Right. And I think the same was said
    in terms of reliability.
        Ms. Onaran. Absolutely.
        Senator Hickenlooper. The same constraints exist and
    restrictions. And we have been discussing all about the
    predictions that NERC has provided that the enhanced
    interregional transmission would significantly lower costs and
    enhance reliability. We have got a BIG WIRES Act to hopefully
    help coordinate interregional build-out, as I have discussed
    with several of you over a period of time. And the SPEED and
    Reliability Act would streamline permitting reform on
    nationally significant lines.
        Mr. Gatzemeier, Micron is obviously making huge investments
    in New York and in Boise. How does that reliability and access
    to low cost influence those decisions?
        Mr. Gatzemeier. On the reliability side, you know, we have
    talked about the impacts that a millisecond dip in power can
    have, right, in significant product loss for us. So reliability
    is absolutely paramount. Availability as well. And that's
    where, you know, the cost of inaction is extraordinarily high
    here. We have a once-in-a-lifetime opportunity. You know, I
    will just talk about DRAM for a second. Ninety percent of the
    world's DRAM used to be made here in the U.S. in 1975. Today,
    less than two percent of the world's DRAM is made here. And
    that is at Micron's facility in Manassas, Virginia.
        With our planned investment, right, in Idaho and New York,
    we will get that up and we will get to where over 60 percent of
    our capacity, you know, 12 percent of the world's capacity is
    built here in the U.S. again, but if we are unable to get the
    power, you know, either the generation or the transmission to
    the locations where we want to build, it will be an opportunity
    missed for the United States.
        Senator Hickenlooper. Right. No, I appreciate that. And I
    celebrate Micron, your innovation and your success. Even though
    you are Idahoan, we still in the West take--of innovation. I
    realize innovation occurs everywhere. I don't want to create
    enemies. But we do appreciate all that you guys have done and
    are going to take this CHIPS and Science investment and make
    the most of it.
        Mr. Fowke and I have known each other for many years, well
    back into my gubernatorial days. AEP testified last year before
    FERC that you are being asked to connect loads across the
    transmission system footprint equal to roughly ten percent of
    the total U.S. electricity demand today. And earlier this
    month, DOE released that preliminary list of National Interest
    Electric Transmission Corridors (NIETCs). And many of these
    primarily designated areas fall within AEP's service area.
        So how would that final designation of these high-priority
    areas make it easier for you to access new transmission
    infrastructure and connect new generation? How much of the work
    has been done?
        Mr. Fowke. Yes. First, good to see you again, and we are
    very supportive of the BIG WIRES Act, by the way, and want to
    continue to work with your staff on that. As far as the
    national corridors, you know, at AEP, we have had a tremendous
    amount of success working with our states to get transmission
    sited, and I think we have had to use eminent domain in less
    than three percent of the circumstances. So I think what's
    important, what the national corridors bring--FERC doesn't have
    the ability across the full grid--is in those rare cases where
    we need a federal backstop to step in when it's a critically
    important transmission line for reliability, that's where I
    think FERC today only has that authority in these national
    corridors.
        So that to me is the bigger thing than having a national
    corridor in my humble opinion, because states should be leading
    the siting process. I think they are critical in that process.
        Senator Hickenlooper. Totally agree.
        Great. Thank you all. I appreciate your--I am out of time,
    but I might come back for a second round of questions. Mr.
    Chair.
        The Chairman. Senator Hoeven.
        Senator Hoeven. Mr. Chair, I am just glad I could be here
    to help balance things out for you.
        The Chairman. Oh, I'm so happy you're here.
        [Laughter.]
        The Chairman. I am looking forward to this.
        Senator Hoeven. Well, I knew you would be. Thanks to all of
    you for being here. I have got to start with Mr. Gatzemeier. I
    don't know if anybody has mentioned it yet that you were a
    four-year member of the University of North Dakota's
    outstanding swim team and that you received a B.S. in
    electrical engineering--double E. So obviously a jock on campus
    and obviously managed to get an electrical engineering degree.
    Pretty impressive. Then went on to, you know, reasonably good
    schools, although not as good, to get an M.B.A. in Fort Collins
    and an M.S. at Berkeley. So I just wanted to make sure people
    were aware of your impeccable and outstanding credentials. If
    you would have had something in West Virginia in there as well,
    it would have been a trifecta.
        [Laughter.]
        Senator Hoeven. But seriously----
        The Chairman. Now you see why we are happy he is here.
        Senator Hoeven. Yes. He and I were Governors together for
    about ten years. So we go way back.
        The Chairman. Way back.
        Senator Hoeven. Way back. But seriously, let me start with
    Mr. Fowke. And that was serious, but I did want to welcome you.
    Mr. Fowke, in your testimony, you say that EPA has finalized
    new power plant sector regulations, and I quote, ``which could
    hasten the pace of plant retirements and diminish reliability''
    at the same time that FERC is saying we need to increase
    electricity over the next five years. Increase it. So, don't we
    need to be focusing on dispatchable resources 24/7 to provide
    this additional electricity? I mean, it's not going to
    magically appear out of thin air, right? So aren't we on the
    wrong track, and don't we need to have EPA work with our
    baseload industry to make sure we can meet our electricity
    needs? And we're not like some third-world country with
    blackouts and brownouts, which have already started to happen.
        Mr. Fowke. Yes. I agree with you there. I love seeing
    renewables on the grid, but you cannot substitute 24/7
    dispatchable generation. In fact, if you look at the queue
    right now, the generation queue, I think it's 2.6 terawatts,
    which is more than double the existing capacity we have on our
    system. But if you look at what is in those queues, Senator,
    over 95 percent of it is non-dispatchable generation.
        Senator Hoeven. What was the percent?
        Mr. Fowke. Over 95 percent of it is--less than five percent
    of it is dispatchable 24/7 generation. So we absolutely need to
    hang on to what we have.
        Senator Hoeven. I heard you the first time. I just wanted
    to make sure everybody else did.
        [Laughter.]
        Mr. Fowke. We absolutely need to hang on to what we have.
    And the EPA rules, I believe, will hasten the retirement of the
    dispatchable generation we have on our grid today.
        Senator Hoeven. Okay. Who wants to disagree with him and
    why?
        Let the record show that nobody disagrees. I think that is
    pretty important. Now, from the user side, Mr. Gatzemeier, I
    don't know, is dependable electricity important at all in your
    business, or do you think it's important to anyone else?
        Mr. Gatzemeier. It's incredibly important, and I know it's
    important to all semiconductor manufacturers. Minor
    interruption, milliseconds, can cause our factories to go down
    for a week and cause, you know--millions--tens of millions in
    product loss, so incredibly important, and our factories run
    24/7, 365 at peak output operations, so we require, you know,
    the baseload to meet our demand.
        Senator Hoeven. So, would you argue it's vitally important
    in terms of our economy, being competitive in a global economy?
    And would you argue it's important for national security as
    well to be able to generate energy for ourselves and our
    allies?
        Mr. Gatzemeier. Absolutely, yes.
        Senator Hoeven. Okay. Any other thoughts on how we not only
    maintain, but increase our baseload--from any of you that would
    like to respond to that? Mr. Mills, sir.
        Mr. Mills. Senator, the fastest way to increase power
    supplies, as we are talking about demands that are occurring in
    the next few years, not decades, is not things we don't know
    how to build, but things we know how to build. So the fast
    construction of dispatchable power will come from gas pipes and
    gas turbines. That will be the primary source of new supply.
    This will be true with the United States--almost every state--
    and it's also true in Europe. It's what is happening in and
    around the world, but especially here.
        Senator Hoeven. And would you agree that American
    technology and ingenuity is driving improvements to
    environmental standards at the same time that we are producing
    energy on a low-cost basis, and on a dependable basis in this
    country, and that is a better approach than regulations that
    shut us down and force us to get energy from other countries?
        Mr. Mills. Well, you know the expression that the question
    answers itself, sir.
        Senator Hoeven. Good. Well, I really like that answer. So
    again, I want to thank all of you.
        Thank you, Mr. Chairman.
        The Chairman. Thank you, Senator.
        And now we have, let's see--Senator King.
        Senator King. Thank you, Mr. Chairman. What's bothering me
    about this entire discussion is that we are only talking about
    half of the equation. We're like in a car on a railroad track
    with a train coming toward us, and we're talking about the cost
    of a tow truck. The cost of not addressing climate change
    dwarfs the cost of addressing climate change. There are
    reliable studies that indicate it is as much as five times. In
    Houston today, the power is off.
        Now, we can talk about this, and you can dismiss these
    studies and talk about environmentalists and everything else. I
    will tell you who is paying attention to this--the insurance
    companies. They are cold-eyed businesspeople. And there was
    just a report this morning that Texas has had to create a kind
    of risk pool because people can't get homeowners insurance
    because of the volume of these violent storms.
        So I just want to put the context here. Nobody is saying we
    should go back to hydro because they love the looks of dams.
    They are saying we should be talking about renewable power
    because the alternative to moving in that direction is
    catastrophic in terms of dollars and cents. So I just wanted to
    lay that little bit of context. I agree with you all, Mr. Mills
    and others, about permitting reform. I have been working with
    the chairman for years on this. It has got to include judicial
    reform. So the whole point is that the process just can't take
    forever. Last week we had the Secretary of the Interior. I
    talked to her about it, and I informed her, because of the
    delays that they have in doing their studies, that Eisenhower
    retook Europe in 11 months. So I suggested she send an email to
    her permitting staff with one word--Eisenhower.
        And so we have got to address that. I understand that. But
    to act like the transition is just something we are doing
    because it's a nice thing to do, or because some elite group
    says we should do it, is just not accurate. Transmission is
    obviously a big part of the problem. Mr. Fowke, I like your
    testimony about GETs, that's not the whole answer, but it's
    part of the answer. And an indication, you increase the
    throughput by 40 percent without building new poles. And I
    think that is the kind of thing--and also dynamic line
    management has got to be part of that as well.
        The other piece is the queue. Nobody has talked about the
    queue. I think one of you, I think you testified there is as
    much power waiting in the queue of the various RTOs around the
    country that's double the total amount of power being produced
    in the country right now. And by the way, it's not all non-
    dispatchable. Five hundred gigawatts is batteries. Batteries
    are dispatchable. And that's a technology that is obviously in
    development. There are other kinds of storage technologies.
    Good old pumped storage has been around for 150 years. All
    those kinds of alternatives.
        But Mr. Fowke, how do we get there? I guess I will go back
    to my original question. Do you believe we have to address the
    threat of climate change?
        Mr. Fowke. Yes, absolutely. And I think there is a lot we
    can do, but we also have to balance that against the need for
    reliable and affordable power. And we need to----
        Senator King. Absolutely.
        Mr. Fowke. I have spoken many times about this in my former
    role, and I will say it as just somebody that is in the
    industry. This industry can make tremendous strides to reducing
    carbon emissions, and already has, more than we probably ever
    thought possible. But that last--you picked a percentage--that
    last 20 percent is going to require different technologies than
    we have today. I am a big believer----
        Senator King. For example, small modular reactors.
        Mr. Fowke. You just took the words out of my mouth,
    Senator. I am a big proponent of that. Maybe carbon capture
    becomes viable. It's not now. Maybe there's something else, but
    we have to have technology move at the speed of value. And I
    worry that when we prematurely shut down power plants that are
    running, that is going to have a very negative impact on
    reliability and potentially the ability to fund this terrific
    growth that we are seeing across the country.
        Senator King. Do you agree though that the queue is a
    barrier in itself, in terms of the what's waiting in line?
        Mr. Fowke. Yes, I do. And that's why we think that FERC
    should be encouraged to fast-track those resources that load-
    serving entities that have the obligation to serve feel are
    essential to preserve reliability. We don't have that today,
    Senator.
        Senator King. I think part of the answer here, and we
    always talk about all of the above. There are so many options.
    Everything from GETs to storage to more efficient conservation.
    I used to be in the conservation business, where we could cut
    energy usage significantly in a factory or a hospital. And
    those are kilowatt-hours that you can use somewhere else. They
    are not generation, but they free up generation to be used
    somewhere else. So, plenty of options.
        Thank you all very much for your testimony. Thank you, Mr.
    Chairman.
        I don't know what to say. You're----
        Senator Hickenlooper [presiding]. I have gotten wiser.
        Senator King. Say something in West Virginian.
        [Laughter.]
        Senator Hickenlooper. I can't quite speak that language
    yet, but I am getting close.
        Senator Hirono.
        Senator Hirono. Thank you very much. I am glad that Senator
    King noted how important it is for us to deal in this space
    with climate change because I agree that the insurance industry
    certainly has gotten it when you can't afford homeowners
    insurance because of the need to cover the results of extreme
    climate disasters, including, I have to say, wildfires, which
    is what Maui experienced. Then, you know, at least we have one
    major industry that has said we need to deal with climate
    change. And thank you for agreeing that that's something we
    have to do.
        So I am interested in the importance of clean energy goals.
    Mr. Gatzemeier, the analysis from S&P Global recently released
    a study on data center power demand that concluded, ``Many of
    the large technology companies and private equity groups that
    own and manage data centers have pledged to use green-powered
    electricity for their needs. And we expect renewables to
    ultimately supply a majority of the incremental supply to the
    facilities.'' Can you elaborate on Micron's renewable energy
    commitments and the role they played in locating new plants
    Micron is building with the help of the CHIPS and Science Act?
        Mr. Gatzemeier. Yes, so at Micron, we have committed by the
    end of 2025 to be 100 percent renewable in our factories in the
    United States, and elsewhere in the world where available.
    Fortunately, you know, you look at Idaho and New York, the
    availability of renewables there was a play. The other thing
    that we were looking at is entering into co-op solar projects
    like we did with Idaho Power, with the Black Mesa project,
    which was a 40-megawatt project. In addition to that, we'd be
    looking at additional PPAs or renewable energy credits
    purchased as well, to hit those goals.
        Senator Hirono. So how much did the falling cost of
    renewable power contribute to Micron setting its energy goals?
        Mr. Gatzemeier. I'm sorry, what was the question?
        Senator Hirono. How much did the falling cost of renewable
    power play into Micron setting its energy goals moving toward
    green energy?
        Mr. Gatzemeier. Yes. Obviously, we look at the cost of
    energy and we are in a cost-sensitive business, so we want to
    continue to drive that and be effective. And fortunately, in
    the U.S., you can get renewable energy credits, you can look at
    renewables that are effective today. However, if there is not
    more generation added onto the grid with the amount of demand
    that we are talking about, the cost of energy would rise and
    create problems.
        So then you would run into availability issues, reliability
    issues, and those are the things that we would like to avoid
    through change here with transmission and additional generation
    of multiple sources coming online. So solar, wind, battery
    technology--to enable those to be more effective--geothermal,
    and we have talked about nuclear with the small modular
    reactors and other investments that could be done to continue
    down that path to meet all of the goals that we are looking
    for.
        Senator Hirono. So I think you are an example of a private
    company that pays attention to these issues.
        For Mr. Fowke, you described how new data centers could
    require 3 to 15 times as much power as a more typical
    industrial plant. Do you think states and utilities should
    require data centers with such a new demand for power to
    install energy storage onsite in order to shave back their
    demand for power from the grid at periods of peak demand?
        Mr. Fowke. I think that's an interesting commentary and
    it's something we need to look into. I mean, traditionally--and
    I refer to my colleague--data centers are backed up because of
    the importance to making sure you have backup power. But I
    think increasingly as we look around, I think data centers are
    more open to doing exactly what you described.
        I also would want to call to your attention the data center
    tariff that we filed in Ohio, recognizing that this
    extraordinary growth needs to be funded fairly by the data
    centers and not cost-shifting to other consumers. We think it
    is a critically important first step as we move forward with
    the data centers--the demand we see from the data centers.
        Senator Hirono. I agree. Mr. Gatzemeier, do you have a
    comment on this question?
        Mr. Gatzemeier. Unfortunately, right now, we have power
    conditioning coming into our site, but we don't have any co-
    generation or large power backup that could sustain us through
    a reliability event. So in the case of a reliability issue, we
    would see a power implication that would impact our production
    in a negative way.
        Senator Hirono. I have run out of time. Thank you, Mr.
    Chairman.
        Senator Hickenlooper. Thank you, Senator.
        So now I get to have a second round by myself, or at least
    until the Chair gets back. He will be looming over my shoulder
    soon enough. Oh my God, there he is.
        [Laughter.]
        Senator Hickenlooper. Looming over my shoulder, as
    predicted.
        The Chairman. You're on brother, take it.
        Senator Hickenlooper. Let me ask a final question. Mr.
    Mills, I will talk with you because you have been working on
    this for such a long period of time, and I think you have a
    perspective and, you know, part of what America values in this
    strange creation of a democracy, that most of the time
    functions pretty well--people have an opportunity to voice
    their concerns. We spend a lot of time designing the process by
    which neighborhoods and counties and states are heard.
        Two of the biggest reasons put forward in terms of the
    slowness of progress, especially in expanding transmission, but
    also making sure that it's efficient where it needs to be, have
    been the process, but then also the litigation. How would you
    rank those, relatively speaking, in terms of where we should
    put more attention to trying to move more rapidly? And again, I
    am a big believer that climate change is real and is happening
    at scale. And the costs of avoiding it, as Senator King said,
    are enormous. By delaying our response, it's going to cost 5 or
    10 times what it would cost now. So within that, where should
    we be focusing our attention?
        Mr. Mills. Well, you know, as a former practitioner,
    building things as a physicist and engineer, you are asking me
    to choose between process and litigation as the lesser of
    evils. It's a tough challenge.
        But seriously, I think what you would find from most
    industries, the threat of litigation is real. And in the
    hypertrophied examples, it becomes the critical--the
    dispositive factor that kills things. But on average, I think
    what you would find in business is that it's the regulatory
    process, it's the sand in the gears that, as economists would
    talk about, that faces businesses small to large in the United
    States.
        So the International Manufacturers Association puts out a
    semi-annual study of the actual costs of process in the form of
    regulations, but they monetize it. And of course, in the United
    States, the last study came out this spring. For a large firm,
    it's $18,000 a year per employee, and for small firms, $36,000
    per year, if I recall correctly, per employee for the
    regulatory compliance process. So that is a huge headwind for
    businesses to start and expand in the United States.
        So I would say, if I had to choose from the two, I would
    say the process system, the regulatory systems--federal in
    particular--but state as well, are big impediments.
        Senator Hickenlooper. Right. And I appreciate that. And I
    would argue that the process is, again, uniquely American and
    critically important----
        Mr. Mills. It is.
        Senator Hickenlooper [continuing]. And we don't want to
    eliminate it. But certainly, I think there are probably ways
    when we look at something like this, where really both sides,
    the Republicans and Democrats, rural and urban, everybody's got
    an alignment of self-interest, and getting things built more
    rapidly to address this energy challenge that we face, I think
    it's maybe a time to go and re-look at some of the processes,
    make sure people's voices are heard, that there is an inherent
    sense of fairness in how decisions are made. But we can do it
    more quickly.
        With that, I yield back to the Chair. The man who must be
    respected, who always is seeing both sides of the fence.
        The Chairman. Well, let me just say to all of you, thank
    you for your expertise that you bring to the Committee. I think
    it's something that we need to continue to raise the alarm on.
    Because I can see a real catastrophic situation happening in
    our country and not being able to meet the demand, no matter
    what side of the political fence you are on. And it's a shame
    that politics has divided us up to what team you are on. There
    is only one team, the American team. And every American expects
    to have dependable, reliable, and affordable energy because you
    know what, they always have.
        We have built a system around what the needs of the country
    are and the defense of our country. And we are getting to a
    situation now because of the political will, if you will, and
    whoever's in charge wants to push one agenda over the other.
    And I have always said this, if it's not feasible, it's not
    reasonable. It really isn't. If you can't do it, we are not
    there. We haven't matured. Carbon capture sequestration, Mr.
    Fowke, I remember, I was Governor at the time, and the Senator
    will tell you this, Senator Hickenlooper here, you all went
    into that venture.
        It was a 900-megawatt plant--the Mountaineer Plant,
    correct? I'm understanding in order to prove that we could
    commercialize carbon capture sequestration, and you all did
    that, and we showed that we could take Clearstream carbon off,
    liquefy it, pressurize it, and put it back in the ground. But
    it took about three--on scale, it would have taken a third of
    your power. So when President Obama--I told him this--I said,
    ``President Obama, you have said go ahead and build a coal-
    fired plant and I will break you.''
        And you would, if you made us use carbon capture at that
    time, we didn't have the maturity in technology. You can't
    build a plant that costs 900 megawatts of investment and only
    gets 600 megawatts of return. That's the problem. That's how it
    would break you. So when they said it was a war on coal, there
    was no alternative. It's either shut it down or get out of
    the--you know. So that was the problem. I will tell you this--
    politically, it changed my State of West Virginia from being
    over 75 percent Democrat registration--old line conservative
    Democrats--but they were still Democrats. That switched now to
    80 percent Republican in one decade because of that. And the
    only thing I have said about transitions, don't ever take
    someone's job away from them unless you have something equally
    as good, if not better, because you will pay the ultimate price
    on that one.
        So this transition is going on. We gave you the maps and
    this and everything else. My state will be hit eventually
    because if it wasn't for West Virginia two years ago with that
    polar bomb or whatever they called it, remember, shut
    everything down, every coal plant we had--and Ben, you can
    confirm this--you were running about 110 percent, putting out
    everything you had to keep PJM from falling apart. It would
    have gone down. So that's all we're asking this administration
    to realize, that I am not defending fossil over renewables or
    either one. I am just basically looking at the load that we
    have and the need.
        And we have replaced--growing up, the only two dispatchable
    24/7 that we had was at that time nukes and coal. Gas has
    replaced the coal. And we saw gas freeze up in Texas and people
    died. So we have some work to do there. SMRs are coming on, and
    we are all in. Battery storage, we are all in. Wind has the
    greatest challenge of all, I believe, of all the renewables
    they want to use because of permitting. So we need permitting
    for pipelines to move carbon capture and really get it matured.
    They need it, we all need it. And that's all we are saying.
        So when Senator Schumer said, you know, he thought it was
    not going to go anywhere, I think it must go somewhere and we
    have it ready to go, and we will, and we are working with our
    Republican colleagues here, our Democratic colleagues, and we
    will go and see if we can move this from this Committee forward
    on the floor.
        But again, your expertise means an awful lot to us. And I
    want to thank you for that. And what we will do is, we are
    going to go ahead and adjourn the meeting, but we are going to
    give members until the close of business tomorrow to submit
    additional questions for the record.
        So with that, thank you. The meeting is adjourned.
        [Whereupon, at 11:48 a.m., the hearing was adjourned.]

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