Vermont’s Path to Sustainability | Jigar Shah and Navneet Trivedi
Join Jigar Shah, co-founder of Multiplier and former DOE Loan Program Office Director, and Navneet Trivedi, co-founder of Vrinda, as they discuss Vermont’s path to a sustainable future. Explore the transition from pilot programs to full-scale electrification during this global energy crisis. Learn why financing solutions and battery storage are critical for Burlington residents, including renters. Our experts break down how local innovation can stabilize energy rates and increase grid resiliency. Discover how we can move beyond fossil fuels today.
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Join Jigar Shah, co-founder of Multiplier and former DOE Loan Program Office Director, and Navneet Trivedi, co-founder of Vrinda, as they discuss Vermont’s path to a sustainable future. Explore the transition from pilot programs to full-scale electrification during this global energy crisis. Learn why financing solutions and battery storage are critical for Burlington residents, including renters. Our experts break down how local innovation can stabilize energy rates and increase grid resiliency. Discover how we can move beyond fossil fuels today.
Transcript
00:00 Jennifer Green: Hello, Burlington and welcome to Net Zero Energy. I’m Jennifer Green, director of sustainability for the City of Burlington, where our goal is to reduce and eventually eliminate fossil fuel usage. We’re really thrilled to have Jigar Shah and Navneet Trivedi with us today. We’re here at the Davis Center at UVM for the second annual Electrify Vermont Summit, and we’ve been really pleased to have Navneet and Jigar join us as the keynote speakers. Jigar is the co-founder of multiplier, an energy advisory firm. Jigar, you were also named to the 2024 TIME 100 list for the world’s most influential people, and you served as the director of the U.S. Department of Energy’s Loan Program Office, which was the federal government’s clean energy investment vehicle. And Navneet, we’ve had the pleasure of working with you for many years in Burlington. You’re the co-founder and COO, the chief operating officer of Vrinda, an energy transition advisory firm located in New York. Let’s tell listeners a little bit about some of the key themes or takeaways that you just shared during your keynote.
01:14 Jigar Shah: First of all, thank you so much for having me. Look, I think that the real question in people’s minds, I think right now, particularly with all of the conflicts in Iran, etc., is what is the art of possible, right? Because I think people sometimes think, oh, we can get to 100% electrified. And I don’t think that’s realistic today. I mean, there’s a lot of folks who use fuel oil and propane and natural gas and other things. And I think in general, when you look at what China has achieved, they’ve taken their overall economy from 25% of all energy being electricity to 35% of all energy being electricity. I think that’s well within reach within Burlington Electric. Right. And that means more electrification of transportation, more electrification for heating and cooling and more electrification around, you know, industrial processes and, you know, some of those kinds of things, motors, etc. And I think that in general, we have all of that expertise here in Vermont. I think so then the question becomes, when gasoline is persistently above four dollars a gallon, right? Why are people not switching to plug in hybrids or electric vehicles, even if they’re used electric vehicles? Like, what are the barriers and how do we best solve those things? I think a lot of what I’m saying to people is that we have been testing these things in a lab at UVM for 25 years, right? We have been testing them within the utility context in pilot programs for 10 years. Right? So the question is, what is it in this moment of an energy crisis globally that we can do to actually get people out of the pilot phase and into the full rollout phase?
02:56 Jennifer Green: It sounds like you want to share a little tough love.
02:58 Jigar Shah: Yeah. I mean, I’ve had a great working relationship with BED, but also many other utilities around the country for years, and my goal is not to villainize or criticize as much as it is to say that. I think these solutions really are ready. And I think for a long time we weren’t in a crisis. And so therefore, the utilities had the ability to go slow. And I think today we’re in a crisis. I don’t think the utilities have the ability to go slow. I think, you know, like in New York state, 1.3 million households are behind on electricity bill for at least two months. Right? I think 20% now of customers across the country are behind on at least one energy bill. And I think that they’re not doing that because they’re deadbeats. I think that they’re doing that because they really are in a place right now where the economy is weak and people feel put upon by all these rate increases. So I think we have to accelerate new technology to really bring rates under control.
03:57 Jennifer Green: Yeah. So tell us what is that? As you know, BED offers incentives. We offer rebates, offer technical support. We offer an off peak charging rate. You know, tell us more. What are we missing here and how can we change the paradigm?
04:09 Jigar Shah: Well, I mean, look, each utility is going to be a little different. But what I find is that about 1/15th of all of the stuff gets replaced every year, right? Whether it’s your water heater or your refrigerator or your air conditioning. And in this place, obviously heating system and then, you know, your vehicles, right? All of that stuff gets cycled, right? And when that cycling occurs, particularly in a moment where the economy is starting to get weak, like we’re in right now, a lot of people don’t have that money when a water heater breaks. And so the question becomes, how do you use like on bill financing? How do you partner with third party financing players to make sure that folks aren’t fleeced? I’m really focused on the people who frankly, are, you know, like, saying, oh my God, like something broke, like this is the wrong time for that to break. You know, I’ve got very little savings right now, and I’m being forced to replace this for hot showers or for, you know, like to keep my food, you know, cold or whatever it is. And I think that in that moment, there’s a set of solutions that aren’t rebates, but are actually financing support.
05:21 Jennifer Green: Yeah. So you’re saying really a time of replacement. We got to lean into that and provide the financing to make that possible.
05:27 Jigar Shah: Or facilitate it. Like, I don’t know that it has to come out of Burlington Electric. It could come out of a partner credit union or a partner, but I think it has to be something where people know in that crisis to call their electric utility, because they’re there to help.
05:41 Jennifer Green: Now, turning to Navneet, we’ve had the pleasure of having you come back and forth to Burlington many times. Tell us what you think. How would you enhance Jigar’s response?
05:50 Navneet Tivedi: You know, I was here in 2018, 19, and I visited some of your credit unions on behalf of Burlington Electric to kind of figure out a way of financing these things. Obviously, that is a route you should pursue. But I want to go further. I think, you know, Burlington Electric should think about owning some of these assets, especially like I’m talking about batteries. And all utility should not be shy of owning the battery, you know, guarantee a resiliency, but then use it because the customers don’t know what to do with these things and they should not know. And then you have to even suppose you’re incentivizing what I have seen is like incentives are not tied to any performance, right? So you need to say that you need to participate. You need to do something with that. I’m giving you some money also. It can be like a partnership. Like, as Jigar said, there may be companies which are like willing to put their capital and all. You just need a partnership. So it’s like ownership doesn’t mean like you need to pay for your pocket, but you can really lower the cost. Like, you know, you have a lot of instruments.
06:52 Jennifer Green: I want to take a step back and think about Vermont in the wider context. You wrote a short policy brief, the two of you, in preparation for the summit where you talked about the potential for Vermont to be an energy hub or an innovation hub. Can you talk about what that looks like and how we’re going to get there?
07:09 Jigar Shah: Yeah, I think when you think about what it looks like to be strategic in this moment, it really means that you want money to come into Vermont from outside of Vermont, right? It’s one thing to keep Vermont dollars local, but it’s another thing to bring outside dollars into Vermont. And right now, because of the way that the New England Independent system operator operates, they actually are paying a lot of money for capacity, particularly on the transmission grid. Right. And so when you think about what it looks like to own the batteries or to control a lot of these batteries, etc., you now have the ability to unlock the ability to get more of the money from the New England Independent system operator. Right. And so that is something that is within Vermont’s control. right? Because you have a bunch of people who want batteries because especially because they’re 70% cheaper than when Green Mountain Power did their pilot with Tesla, right? And so it’s much cheaper today than it was just seven years ago. Right. And so, so now we’re in a place where people want it because, you know, sometimes they lose power in their home for a variety of reasons, right? You get really bad storms or whatever it is. So they want these resources to ride through those things. They work from home, right? Whatever it is. But as Navneet was suggesting that battery can be used in a distributed energy resources management system or a DERMS platform, and actually then sold and packaged to the New England ISO. Right. And so when you think about how that works, it has to go through the utility company. It really is very hard to see how any individual private sector company is going to aggregate a bunch of batteries and bypass the utility to get access to those revenue streams. And so it has to be fully coordinated.
09:02 Jennifer Green: Yeah. So the challenge, of course, well, the challenge or opportunity here in Burlington is because we’re so small, 14 square miles with very few outages. Batteries are not cost effective for us. So we’re talking utility scale battery storage. Is that right?
09:15 Jigar Shah: Yeah, I think we’re talking about utility scale batteries. But we’re also talking about behind the meter batteries because, you know, you can imagine that whether it’s cost effective for you or not, there’s a lot of customers who find it appealing to have a battery, right? And so if they’re going to choose to have a battery, the question is whether you’re willing to unlock these other revenue streams for them or whether it’s too much of a bother.
09:41 Jennifer Green: I love the talk about batteries. I do feel it’s a little off topic for Burlington. I’m thinking our 60% rental rate.
09:49 Jigar Shah: Oh for sure. But remember, even if you’re in a rental building, Burlington Electric can ask for permission to site a battery at that apartment building. Right. And a lot of those folks will say, sure, as long as you’re paying me rent for the land that you’re using, I’ll let you use whatever property you want. And because the electrical infrastructure is already there, you can integrate a battery very cheaply at the site, right? So that gives resiliency to those renters, even if they’re not paying for that resiliency. And instead you’re getting paid by the New England ISO. I think separately, whether you’re talking about heat pumps or you’re talking about electric vehicles, right? As you electrify more of the economy, right. Well, then that resiliency matters even more because now that you’ve electrified their heat, well, their heat comes from having electricity. So if they lose electricity, they lose their heat. So that battery becomes even more valuable. And so I think it’s important to recognize that batteries and storage broadly is something that everyone is learning about through this Iran crisis, right? Everyone is now learning. Where do you store oil? How long do you store oil? What’s a strategic petroleum reserve? Why do we have them? Right? The electric utility is the largest commodity supply chain in the world, where they believe that they just can match supply and demand on every second basis for the rest of time. They don’t feature storage, right? The food supply chain has grain elevators. The fuel supply chain has tank farms, right? Everyone features storage except for the electric utility industry. And that is changing right now. We are moving to a place where batteries are 97% cheaper than they were ten years ago. And so as a result, batteries have now become cost effective for lots of things. But the culture of the utility is still saying, well, but we’re used to actually just doing this really complicated thing where we just match supply and demand every day. This easier thing that you’re talking about, where we feature storage is a departure from the way that we’ve run our grid for the last, you know, 40 years. And we’re saying, yes, that’s true. And you are heroes for doing this extraordinary work, but these tools will make the system more resilient and make it so that you don’t have to do this Herculean feat every single day of matching supply and demand. You have this buffer now that can help you.
12:11 Navneet Tivedi: The key here is, as I said, if utility is willing to go behind the meter in customer’s home and, you know, own these things, those people will not kind of mind because it makes their building more efficient. They can earn more revenue. You should have sharing with them something more. So I’m just saying that, okay, your rent is 1500 dollars through utility intervention. If I can get you one hundred more dollars or two hundred more dollars, he will take it, but that he’s not going to do on his own. And that’s why I think in the rental scenario, it is more important that, you know, you try to take the ownership and go behind the meter and do these things.
12:47 Jennifer Green: Okay. So I’ve heard you talk about the technologies available. We’re sort of all lined up. We’ve got the data. We’ve been studying this forever. You’ve expressed frustration that now we’ve got to change policy and adopt laws that really expedite this, this vision that you have.
13:04 Jigar Shah: Yeah. I’ve worked with electric utility companies my whole career and just find that the people who work there are extraordinary. Right. But they also have this consensus driven process, right? So there might be twelve or fourteen decision makers around the table, and any one of them can veto an idea. Right. It’s not like, you know, and so you’ve got, you know, eleven out of twelve of the vice presidents have all said yes to an idea. And one of them says, I don’t know, there’s a 0.01% chance that this could go badly. I think we should study it for another three years. So in that environment, again, I’m not beating up on the utilities, but I’m saying that in that environment, what eleven of those twelve vice presidents need is a law that sort of says, you will do this because it’s already been piloted to death in four hundred utilities. We have all this data. Even the Electric Power Research Institute is now backing this idea, and they are slow to back lots of ideas, right? And so it is time for us to overcome the, you know, conservative nature of the utility, which you want. You want a utility company who is conservative and protecting all of their ratepayers. But in this moment where you have a shortage of transformers, a shortage of pole transformers, a shortage of all of these essential things that you buy to keep your grid running. And a lot of that stuff is 50% more expensive today than it was three years ago, right? These other solutions are way cheaper than business as usual. Right? And so I’m not suggesting we pass a law because the utilities are intransigent. I’m suggesting we pass a law to help the utilities because they have a culture problem within their utility, where one person has the ability to slow something down and they need a law. So they can say to that one person, I’m sorry, but we have a law that we have to comply with. And so you being the last holdout, like is not going to stop us anymore because we have to comply with the law, right?
15:05 Jennifer Green: BED just for our listeners, of course, is a municipal electric department. So we’ve got four or five commissioners. And we do tout ourselves as being quite innovative. I hear what you’re saying though. You know, we’ve got the data, we’ve got the technology. These are utilities in general. Let’s go ahead and unlock what we’ve got.
15:23 Navneet Tivedi: So in my mind, this is not really a issue of like whether you are investor owned or, you know, this is a mindset in general, like, for example, years and years, you know, we have safety, reliability. And like, if you say this is for safety. Nobody can question. And in the name of safety, they can do whatever they want. Even like, you know, I used to review projects and will say what this has to do with safety. But the guy said, if I don’t put safety, they will not let me fund this project.
15:49 Jennifer Green: Jigar tell us sort of where we are from a reliability perspective, given the Strait of Hormuz and what that means for the fossil fuel industry and the opportunity to strategically electrify.
16:01 Jigar Shah: Well, I think that when you think about the blessings that we have here in the United States, I mean, we do have a lot of oil production. We have a lot of natural gas production. We have a lot of coal, right? We have a lot of resources. We have a lot of wind and solar and hydro and geothermal now. And I think we’re increasingly starting to build new nuclear again. And so I think we have a lot of these benefits. And diversification is helpful when you think about the last winter storm. I mean, we ran on a lot of oil fired production for a week, right? And so I think that diversification is, is valuable. But 60% of the fuel oil in the northeast comes from the Straits of Hormuz, right? And so that fuel oil is going to get super expensive next winter, right? And so now the question becomes, you know, do they still have to be on fuel oil? Do we have the technology? Maybe we leave the fuel oil in for when it’s negative twenty degrees. But, you know, most of the time it’s only thirty two degrees. And they could probably just use a regular heat pump, right? And so the fuel oil now becomes backup. And they only use it, you know, a little bit of the time and sparingly. So it’s still there, but it’s not being used as much. Right. And so I think when you think about beneficial electrification, I don’t think it has to be all or nothing. Right? I think part of what we’re saying to people is that, for better or for worse, we are in the largest energy crisis that anyone listening to this podcast will have faced in their entire lives. This is bigger than the 1973 oil embargo, right? When you think about the level of fertilizer that’s missing, right? We’re going to have probably 25% less acreage that applies fertilizer this year around the world. The amount of disruption that we’re about to face is so large, and the fact that UVM and all these other places have done all of this research and all of this piloting for 25 years, with the help of Burlington Electric and the help of Green Mountain Power, it is time to move to deploying things because every little bit helps, right? Every little bit where we are shifting away from fossil fuels towards electricity, we don’t have a shortage of electricity in this country, but we do have a shortage of a lot of these other supply chains, and they are being exacerbated by the Straits of Hormuz. And unfortunately, I don’t see this situation becoming back to normal for three years. Right? Like not like three months. I mean, when you think about some of the infrastructure has actually been damaged in the Middle East, and so it’ll take three years to fix some of it. And so I think people are not really feeling how disruptive this is going to be and how important their electric utility is going to be in this moment to help fill in gaps.
18:46 Jennifer Green: You know, you paint this picture, which is, you know, quite serious. How are we going to work through this?
18:51 Navneet Tivedi: We need more than ever because this is a crisis. This is not a time where I’m utility. You are a developer, you know you are a regulator. It doesn’t matter if you have to write, do things and then tell the regulator that. Write the rule now because it works. This is the time. So I’m just saying that we need to bring everybody together. And I think this is the time when Vermont and Burlington need to get out of, you know, pilot mentality and that we are small and we we cannot do much. We don’t have any. You know, we know anybody can make a difference in Vermont because sheer like innovation in your thinking, you can make a difference.
19:36 Jennifer Green: Thank you again for listening to Net Zero Energy from Burlington Electric Department. If you have any questions about this show or what BED offers regarding rebates or technical support, look for us at burlingtonelectric.com or call us at 802-865-7300. We’re here to help you on our mutual path to Net Zero Energy.