NREL Industry Growth Forum Speech by Board President Cynthia McClain-Hill

Delivered May 2, 2023

Good morning. I thought it might be good to “jazz-things-up…just-a-little-bit” before I got to the substance of my city’s response to climate change and its clean energy future.

Let’s start with "Equity” … some might scoff at the notion… others might feel it’s (what’s the latest pejorative), “woke.” But the truth is, equity has been a matter of concern, at least for some, for a long time, hence the message of Ray Charles’ 1962 classic 'Them That Got.'"

I’m really happy to be here today to talk about the City of LA’s policy work in building the foundation, and developing the infrastructure for a cleaner, greener, and electrified City… And doing so without leaving a significant number of our residents, customers, and diverse communities trapped in a carbon-fueled past.

Los Angeles has its fair share of inequality. No place in the country can escape the realities of the “haves and the have-nots.” But in a city the size of L.A., with its population of four million residents, the economic disparities are dramatic, leaving way too many identifying with the song’s sentiment “And I ain’t got nothing yet.”

Los Angeles has some of the wealthiest zip codes in California, and across our nation. We also have some of the poorest. But those who rarely get singled out, are the women and men in working families that fall between those income-earning extremes, and the jobs they perform, as nurses, teachers, food and commercial workers, public safety employees and a range of others. These are the same working men and women we deemed “essential” during the height of the COVID-19 pandemic. If they hadn’t shown up to work, we would have all suffered. The fact is, they’re “essential” because our economy doesn’t work without them.

It’s important to remember, we pushed them onto the front lines of a deadly pandemic and implored them to do their jobs. But as the virus has receded and pandemic deaths have slowed, we no longer view them quite the same way. Still when we need them to embrace major changes to facilitate carbon-free technologies for the benefit of everyone, we’ll be back to telling them that doing so is “essential.”

A lot of us have been fortunate. We not only earned more during the pandemic, enabling us to meet our financial obligations, but we were also able to work from the safer, sanitized confines of our own homes. During our pandemic years, we were… the “Them That Got.”

So, how does all of this relate to our drive toward a clean energy future in the City of Los Angeles? Simple, it informs our conclusion that we won’t be successful in reaching our clean energy future unless everyone in our city is along for the ride.

Equity in this context isn’t political or cultural. Equity is the sensible and right approach. Not to mention an actual moral imperative. As utility policymakers, we firmly believe…, we know that leading with equity is the only path to our city’s decarbonized tomorrow.

Without a “just” transition, we’ll end up overseeing just another run-of-the-mill technology-fueled “advancement” necessitating another series of behavior modifications that our customers are asked, encouraged, incentivized, and sometimes forced, to make; even if they know, and we know, they can’t financially afford it, their built environments won’t support it and their quality of life is a mere afterthought.

So, when you think about making your investments and developing new technologies to help save our planet…and to make a profit… don’t forget the people…the people you should be partnering with, learning from, and reflecting in your business models. And don’t stop there, consider your corporate governance, management ranks, and with whom you place your capital, because…, frankly speaking, diversity, equity and inclusion is essential to the long-term success of your clean energy business ventures, products, and applications.

Don’t let anyone tell you leading with equity is not good business. Understand that it pays dividends and profit from it. If our residents resist the impending transition to clean energy, it could put us decades behind in our effort to achieve our carbon-free goals. A setback of that magnitude won’t lessen the social, health, environmental and economic impacts, and burdens brought about by climate change, it would increase them.

We need to cultivate adopters, not resisters.

For the past year, the Los Angeles Department of Water and Power has been engaged in a focused study on equity strategies as part of our city’s LA100 initiative to achieve 100% clean, renewable, carbon-free power generation. Our mandate is to be there by the year 2045 at the latest, but we’re making a concerted push to achieve this goal even faster, by the year 2035. Think about the audacity of our city’s ambition, it’s just 12-years from now.

We knew we couldn’t make this journey without a roadmap, so, we turned to the National Renewable Energy Laboratory. Through their incisive analysis, NREL senior researchers and staff plotted a course that would get our city to its clean energy destination. Now that we have a clear roadmap, we need to make sure that all of our stakeholders are prepared and willing to take the ride.

We asked NREL to provide us with point-by-point directions – a clean energy equity GPS, so to speak – that delivers our residents and customers to our ultimate destination, together, with no disparities in how they experience their new carbon-free future. The Equity Strategies Study is a natural extension of NREL’s work on our city’s initial LA100 Study. But, make no mistake, LA100 Equity Strategies is a unique, transformative, and industry-leading undertaking. And rest assured, we’ll be excited to share its findings this summer.

NREL has our city’s gratitude for taking on this extremely important work. In the end, our clean energy future is one where everyone benefits from cleaner air, good jobs, economic opportunity and growth, and importantly… an equitable cost structure. What do we hope to find from LA100 Equity Strategies? Some of what we already know, and… more specific things we don’t know. That said, we haven’t been waiting around for the recommendations from the study to take the actions we know we must take now to address the needs of our utility customers.

The COVID-19 pandemic showed us that a substantial number of our customers needed help managing the costs of their energy usage. In the past, if a customer failed to pay their bill the response could be swift and certain: shut-off their power. But that act alone – cutting off a customer’s power – could trigger a quality-of-life crisis for many families – no power means no light, no refrigeration. Power shutoffs can also lead to household financial calamities worsened by mounting past-due utility debts.

Pandemic Recovery Act funds enabled us to aid our customers and think of new ways to help them keep their lights on, so their children could do their homework and seniors weren’t stranded alone in the dark. Now, we’ve gone further. What had once been a pandemic emergency response is now policy. Our Board of Commissioners voted to end utility service shutoffs as a debt collection method for our low-income customers. Today, we work with these customers by offering extended repayment plans, free access to energy and water conservation technologies and Level Pay billing to better meet their needs. In all, we provided $554 million (five-hundred, fifty-four million dollars) in utility bill financial assistance to hundreds of thousands of our customers thanks to the support we received from the federal and state government …combined with our own resources. You heard that right, to support our customers, we put money on the table too. We’ve taken other steps, as well.

Let me digress for a second to talk specifically about climate change. I make it a point not to argue about it. You either believe it’s real or you don’t. Either way, the consequences of a changing climate can be seen in the natural disasters we’ve experienced in California; More than a decade of drought, thirty-one (31) atmospheric rivers that flooded communities this past winter and covered the Sierra Mountains in record snowfall, and, of course, last summer’s record 121-degree temperature in a portion LA’s San Fernando Valley.

On that last item, we launched a program called “Cool LA” that offers our low-to-moderate income customers reduced costs on portable air conditioning units… rebates redeemable at the point of sale. Extreme heat can kill, and children, seniors and those with compromised health conditions have the highest heat stroke risk. These aren’t the actions most people think of when they think of their water and power company. But they’re necessary steps to serve our customers, and in some cases, save lives.

Among the things we’ve learned through LA100 Equity Strategies is how critical it is for our department to engage our community. Community engagement and community-based organizations have been fully integrated into the study process. No one understands equity better than those who feel, and have felt for a long time, that “They Ain’t Got Nothing Yet.”

So, the message I want to underscore for you this morning is; understand your customers, not just your client. Engage members of the communities where your investments in grid modernization and end-user technologies will be utilized. We have a long way to go and not a lot of time to get there.

And, I know one thing for sure: We can’t afford to be late. Leading with equity will ensure that we all arrive at the same time because we took the right, agreed-upon route, not the wrong one.

Assess your investment strategies and calibrate your technologies to fit the needs of the greatest number of our customers. Latino homeowners and renters in East L.A. will need home solar as much as their more affluent neighbors in the Valley and West L.A. We need your innovation and capital investment to make that happen. The millions of car and truck owners in working class neighborhoods in South Los Angeles, East L.A., Koreatown, Chinatown and, Little Tokyo can’t all drive their plug-in EVs to West L.A. to charge their vehicles overnight.

Of course, right now that’s hypothetical problem, because people in working class communities don’t own EVs in substantial numbers. The point is: When they’re forced to buy EVs in 2035, they need EV chargers where they live, not just where they work or shop. Making their EV charging infrastructure a reality requires leading with equity.

If you’re looking for market share, that’s where you’ll find it, in working class neighborhoods throughout our city. Right now, early adoption of clean energy technologies is based on a “Them That Got” foundation.

Cleantech industries have been focusing on low-hanging fruit in affluent communities, but the potential is much greater, and the incentives provided, largely by the public sector, will most assuredly start focusing more and more on the have nots, rather than the haves.

And to be clear, that includes LADWP. The challenge is yours to meet. The good news is I am absolutely certain that you can.

So please, in moving forward, be bold! Make history by building a future that learns from the mistakes of the past. Double down on the three Ps. And most of all, lead with equity! Thank you.

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