Angel Investor’s Guide to Changing Our Climate Stories | Ramez Naam for Project Drawdown
So, I'm really excited we're going to talk to Ramez Naam. Ramez is one of the world's leading thinkers about technology and the future of energy and how it links to climate-change solutions. He's a noted science fiction author and a former executive at Microsoft and is one of the world's leading thinkers about technology, change, and the future. So, Ramez, thank you for joining us today! I'm really excited to have you here and talk to you about climate change and what we could do about it. Well, how about first, I'd love to hear your perspective on, you know, as a technologist, as someone who's thought very deeply about this, but also, somebody who's thought very deeply about future issues, what worries you right now mostly about climate change? What are the things that kind of keep you up at night about this issue? I worry about the second-order effects and the nonlinearities that are hard for us to predict. I worry
about ways in which, you know, things that are close to the science – temperature rise, direct impact on ecosystems – can have ripple effects. Coral reefs dying, being close to the bottom of the food chain, for billions of people who rely on ocean protein. You know, drought causing crop failure, causing societal unrest, causing refugee phenomena that cause political changes. Those are the things that are, are really hard to predict and that keep me up at night. Yeah, and sadly, we're beginning to see maybe some early glimpses of things like that now. These kind of, you know, domino effects or, you know, what you call a nonlinearity where small changes sometimes get into be big impacts later.
What are some examples of that, do you see today that you worry about? Do you see some of that happening now? Well, I mean, there's a lot of discussion of things like was Syria or Darfur, and Sudan, were those climate events? And it's actually – there's not an easy yes or no answer. But, you can imagine that, you know, the Darfur sort of left the headlines now, but 3 million people died, was a local ecological issue. It was a overuse of resources in a conflict between farmers and grazers who just were overusing the resources that were there. And so I do worry that things like massive droughts in Latin America, or in the Middle East and North Africa, could unleash waves of immigrants and then – I would have imagined 10 years ago that places like Europe and the US would be incredibly compassionate and welcoming to those immigrants, but now we see that's not necessarily the case, and that the immigration waves have maybe drove a rightward surge in governments over the last handful of years. So it gets sort of weirdly interconnected in ways that I would not have predicted myself. Yeah, that's one of the things we really worry about in our community, is, you know, you're alluding to what is sometimes called a threat multiplier. Like, you know, climate change can take a bad situation we might've had already and make it a lot worse, whether it's a refugee crisis, or a drought or a famine, or even a disease outbreak, in some cases, things like that.
And so, yeah, this kind of idea of like, climate change being kind of the overhead on top of the future, that's just going to make things a little bit harder, a little bit harder, a little bit worse, and maybe even more unpredictable is something inherently hard to predict, inherently hard to manage, but it's the world we're moving to. We have to think about it very, very hard. And that's the language of the U.S. turn of events and the U.S. intelligence community, as well, as they talk about climate change as a threat multiplier to the U.S.
And they talk about things like climate, having the biggest – we talk a lot about climate justice in the U.S., right? About, like, minority communities and so on. But, let's be real. The biggest threat of climate change is in the developing world, in least developed nations that are already teetering on the brink of whether or not they hold together and function effectively.
And that's what U.S. DOD and U.S. DNI see as the biggest threat. That climate change could take nations that are teetering on the edge, tip them over the edge into civil war or, or falling apart, and that becomes a breeding ground for terrorism, extremism, and so on. Yeah, so – that's the bad news. That's the bad news.
Very bad news. And so this idea of like, you know, the multiplier kind of idea, I think it's, you know, pretty, pretty damn serious. But, I like to flip it on its head. I know, you think about this, too. It's like, well, if the threats can be multiplied, but what about the solutions? Can't they be too? That sometimes the things we might do to address climate change might turn out to be really good for us in other ways, perhaps addressing some of our other big systemic problems. So you know, what do you think about that? Do you think that we can find kind of win-wins here if we really focus on solving these problems, rather than just letting them hiss? I think we are. And I think we stumbled into it accidentally. People have assumed for a long time that we had to fight climate change, and we had to be willing to give up something to do it. But what’s happened, and I came from technology. Before I've worked in climate and energy I worked in software, for Microsoft. And in technology, we take for granted
that the computer chips that power your cell phone, your laptop, and so on, just plunge in price and improve in performance dramatically, by a factor of 100 every decade or a million over the last 30 years. And when you look at clean-energy technology, whether we're talking about solar power, or the batteries of electric vehicles, or even wind farms to an extent, we see this similar massive plunge in price. I've been writing about this for the last decade, and I was pretty much called a crazy optimist. You know "What's this tech dude saying about solar power? He doesn't know anything about energy, it doesn't make any sense." When I wrote my first forecast in 2011, and in fact, I was wrong, because I was too pessimistic. The actual cost decline was faster than I thought it would be possible. And so now the IEA, the horrifically conservative organization, International Energy Agency, just put out its report, they're always way behind. They just put out their latest work, Energy Outlook, where they say, solar is
the new king of electricity systems. And Bloomberg New Energy Finance says solar is the cheapest energy in history. And so now, even though solar is only two and a half percent of all electricity globally, and even though electric vehicles are less than 1% of all vehicles globally, those deployment numbers, those are a trailing indicator. The leading indicator is often cost. People tend to buy whatever, you know, works best, cheapest. And the prices are just coming down at such a pace
that it looks to me at this point that the cleaning up the electricity supply and ground transportation – cars and trucks – is now just a matter of when, not if. It's now an inevitability, and it's just a matter about the pace, and can we make the pace go even faster than it would on its own. Yeah, that's been astonishing, and I've been following your writing on this for awhile now, that the plunging price of solar and batteries, maybe a little bit too. Sometimes we forget about LEDs, that's another kind of semiconductor thing that got so much better and so much cheaper. And they're just, you know, they're obviously the right way to go. I wonder if there's something about these kind of technologies that's different than other kind of energy and other transitions we made in the past that are more – more like what we saw with Moore's Law and computing that maybe it's the semiconductor, maybe it's leveraging consumer electronics, as well as big power systems, kind of leveraging each other.
But, why is this so different? Why are we seeing this kind of tremendous speed and breakthrough in solar and renewables, batteries, things like that now? There's actually a pretty good paper out recently talking about this. And we see is that, in most technologies, there is some cost reduction as the industry matures and scales. Because you get learning by doing, which is to say you – You look at solar, why is it cheaper? Well, we've made the solar technology better, so it turns more wavelengths of light into electricity. That's about a quarter of the cost reduction. The other three-quarters, though, is reduction in labor costs, energy costs, material costs. They slice the silicon
wafer thinner. They use diamond blades to, like, make it very precise. They recycle the silicon that's lost. They have found lower temperature ways to turn sand into the purity of silicon wafer that they need. They have factories that are more automated. And one of the – a couple of parameters that make technologies more likely to have very rapid constant declines are modularity, simplicity, and mass production.
So technologies that are built only on a really, really big scale, like a nuclear power plant. I love nuclear power, actually. But today's big, traditional nuclear power plants that are built at the gigawatt scale, have an average cost overrun of more than 100%, 100 to 120% in time and in dollars. Because each one is a megaproject, each one is customized to the site, and there's no like learning by doing. It takes a decade, right? Whereas solar you just like crank out millions and millions and millions of panels per month in these factories, and those panels could go onto our home rooftop, a school, a big utility-scale farm in the desert. And that ability to mass produce makes it much more likely you'll see that steep technology learning rate.
Yeah, that makes a lot of sense. There was a book out recently, you probably saw it from a professor of the University Wisconsin about, like, "How Solar Got Cheap" I think was the name of it. Yeah, it's kind of interesting, I think his argument was something like well, you know, American R&D early on, you know, Bell Labs and NASA and whatever, we hear these stories. But then European, mostly German policy, that kind of mandated that these start to be used in a bigger scale. But the critical thing I think, you know, is kind of the Chinese manufacturing, bringing it to scale and the efficiency and cost structure going so far down. Do you buy that argument? Is it the kind of thing like we need R&D
then need kind of policy to kick it off. But, then it's really going to be the market that kind of brings things to scale. That's when you get that tipping point where policy isn't needed anymore. Yeah, I do. I mean, I don't think that means that you give up on policy. It's – with solar and wind, for instance,
you know, we'll start to – yeah, we'll start to see saturation when they’re too much of a percentage of the grid, so you have to have policy to push other things. And we need to go faster in all these areas. We need to have policy to figure out long-duration, multi-day energy storage. Weeklong, 10-day energy storage. But, yeah, fundamentally, government has a great role to play in funding early-stage R&D into breakthrough energy technologies. Nobody can fund that like government. And we spend less on that in the U.S. than we spend on shampoo. You know? Like – and two, these scaling policies, policies that make the industry bigger by generating demand. Whether Germany did it by
a feed-in tariffs and subsidies, U.S. states have done it by RPSs, renewable portfolio standards, saying x% of energy must be clean by a certain year. That scaling of industry then takes over. And that – just by making a bigger market, you get these players the ability, now that they know that market exists, to invest in bigger factories, more automation, more ways to make their process more efficient. Like make the demand and the producers will, will show up. Yeah, that's a nice example of how, you know, kind of early-stage policies and R&D, plus incentive structures that you were just mentioning, and then market forces bring things to scale. They don't have to be in opposition, they're actually very
complementary to each other. That's when – That's when America gets things right, is when we get those things, you know, we used to do that better. And I love your example, of we spend more on shampoo than saving the world, which is sadly true. Yeah. But what do you – you were mentioning, like energy storage, and, you know, beyond the short-term battery kind of thing, I think you're thinking about here. But what are some other kind of technologies that excite you now, or things that you think we really need to focus on? It seems like electricity generation we kind of got some good momentum on, but we've got to do more and there's a lot more than just electricity facing us on climate change. Where are some of the big issues? Well, you've done great talks on this, and you've shown great slides on, you know, the pie chart of emissions globally and so on.
So, electricity is about a quarter of global emissions as of the last IPCC report, and that's where we have the most progress. Transport, 21%, we have the second-most progress, at least for the ground section. What's hard, what are the hard problems out there? Within electricity, that long-duration storage or long-range transmission, either way you can slice it, is one of the biggest problems. But, then you start talking about some other big chunks that I think are underestimated. Agriculture, deforestation, land use change – that's about a quarter of all global emissions. It's not actually going up very fast. It looks kind of flat. It's very policy dependent. But, you know, and it’s not any one thing.
It's not just methane emissions from cows. It's not just deforestation. Well, a whole lot of it is clearing land that is forest or a wetland or something to turn it into either grazing land or land to grow animal feed or land to grow biofuels is horrific. In terms of its direct biodiversity, direct ecological impact, land clearing is actually even worse with climate change in the short term, and it has this massive carbon emissions impact as well. So there, I think, mostly about policy approaches. How can we protect more land? But I do think increasing crop yields, by every approach we possibly can, so that we can grow more food on a smaller footprint, makes a huge impact, especially in the developing world.
And these alternative protein companies that are out there with everything from vegetable-based protein to cell-based agriculture, that just cuts the land use versus meat, you know, by a factor of 10 or more, is a big deal. And biofuels should just go away, at least on the ground, as much as you should replace them. And the other really big challenging one – there's two, but the bigger of them is industrial emissions. This is all about heat. But there's sort of low-temperature heat, the building that you're in, even though it's snowing right now, I'd call that like a low-temperature heat situation. We've got to get it up to, you know, 25 C in your office building, something like that.
But there are – and that is natural gas, so we, you know, let's talk about heat pumps and electrifying that. And that's a decent chunk of emissions in the world, and in developed nations especially. But, the high-heat industrial processes - making steel, making cement, making plastics, even glass. Those are bigger than transportation. Steel is four times the size of aviation. People are saying "Oh, climate activists shouldn't fly."
Your steel footprint is much bigger than your aviation footprint, probably. We need to do now in those industrial sectors what we did in electricity with solar. Which is bootstrap more and more of the early stage R&D, and then create a demand signal to tell the world we are going to buy, we are going to source steel made with no carbon dioxide production for x% for, you know, 2% of our steel next year.
We're going to build buildings. The skyscrapers built in our – the apartment blocks built in this city, the cement that we use, number two industrial source, three times the size of aviation. The cement we use is going to be – have a dropping carbon content or carbon emissions footprint like this over the next few decades. Create that demand signal so that
those technologies get bootstrapped, scaled, and get cheaper. Yeah, that's a really good point and the industrial emissions have been kind of the – kind of the orphaned climate solutions in some ways. We hear a lot about electricity. Some quarters we hear about food, but we usually focus on the wrong things when it's really, it's deforestation, methane, and nitrous oxide. We forget about that from fertilizers. Yes, yes. But then you get to industry, which is, you know, a big sector as well. And, yeah, it's very important people know that
steel and concrete, I mean, you've heard the statistic, if concrete were a country, it'd be the third or fourth largest emitter of CO2 in the world. And it's not just the fossil fuels, it's the chemistry of concrete itself. So we've got to solve that one. And, where do you see some of the best innovations happening right now? I mean, do you see it in like the national labs and government research. Is it in venture capital and private research? Where are we finding the innovations we need in things like steel, concrete, long-term energy storage. Who's going to crack that nut? There's incredible innovations. A lot of it is funded by government, which means we could have even more. If you look,
in the U.S., we have, you know, various Department of Energy programs, including ARPA-E is the energy equivalent of DARPA, and they've invested a lot in that long-duration storage sector. You see Europe really focusing on clean industry, and Europe really focusing on hydrogen. You know, focusing on an approach rather than the problem in a sense, but hydrogen can be used to make carbon-neutral steel, can be used to do – green hydrogen made from cheap solar and wind can be used to do high-temperature industrial heat.
So that's where a lot's happening now. There's some venture capital in this sector with things like breakthrough energy ventures. Bill Gate's funds and so on, or the Prime Coalition. But most venture capital is scared of really physical, hardware-based technologies. It takes a long time to bring it to market. So government has a big role to play, both in funding R&D and in creating that demand signal that will
scale the market. Yeah, absolutely. Well, where do you see – I guess some of the most exciting innovations happening right now? We just talked about some of the big technological challenges facing us, like, you know, steel and concrete. We can solve that but you know, it's going to be tough. But what's the stuff that gets you really excited right now? What do you think is like "Oooh, this is really cool!" Man, I mean, I just, stuff happening on electricity is amazing every day. The EV revolution is really coming. I think we're a few years away, you know, 2023, 2024, 2025 where buying a brand-new car, the purchase price, the sticker price, is just going to be cheaper on an electric with a 250-mile range than it will be on a gasoline car.
And then once you own it, there's going to be no maintenance. You just – there's no fluids to change. You like change the windshield wiper fluid and rotate the tires. No belts, no gears, no transmission, and the energy cost is a third or a quarter. And you don't have to ever stop at a gas station, really. For like daily commuting, you just treat it like your phone.
You just plug it in when you get home. So that I think is going to make a big impact, and it's going to come on faster than people believe. Yeah, I like your point, it's like, you know, when –we're not talking about like, sacrificing. Sometimes these solutions are "Hey, wow. We came up with something better. I get a car that's cheaper to buy, cheaper to run, doesn't break down" –
mechanics are going to hate this, by the way – but, you know, and it just runs forever and you can just, you know, we figure out how to recycle the batteries, that kind of thing. There's some challenges still, but it's going to be great. These aren't necessarily sacrifices. Some things will be. Some things will be hard, but a lot of things are like, "Hey, we learned how to do this better." Even in food, too. Like we find, like hey, it isn't about sacrificing eating something bland and awful. Like we're
talking about eating better food that might be healthier for us, often very tasty. We're wasting less of it. I'm still – well, I would love to ask you about this. We sometimes forget about like efficiency still. Like there is energy efficiency in the electricity sector, buildings, industrial sector, food efficiency, reducing food waste. And when we do our, crunch our numbers, it's like, gosh, it's almost always a quarter to a third of the answer is still efficiency, low-hanging fruit. Why doesn't that get the attention it should? Why isn't efficiency sexy? It's a really good question. It's not very sexy. You know, it’s, it's just that people like the new, and they, they don't
get nearly as excited about retrofitting the old. But, we're going to have to do it. Inherently, electrifying the world and powering it by renewables is also going to be way more efficient. Today, if you run a coal plant, you know, two-thirds of your energy, ultimately, is loss of heat, either in that plant itself, or transmission losses. If you operate a motor vehicle, you’re – you've got like a 15% efficient vehicle, something like that. Like this, you've got this, this combustion engine that, that burns stuff and is small.
It's not very efficient. It loses most of the energy as heat. And then when you brake, you're just taking all of that energy and throwing it away. As opposed to the EV, it's got a 90% efficient electric motor and regenerative braking that recaptures that energy. So you make it sexy by integrating it into something that gives the customer some of the value they're looking for.
In that case it's longer range versus an EV. So one of the things I really like about your perspectives on climate and energy is you seem, kind of like, to find, you know, opportunities in these solutions. And that's not always the tone you hear from like, you know, some other parts of an environmental community, let's say. Sometimes it's about, you know, punishing the bad polluters, or you know, about the sacrifices we're going to
have to make, about all the terrible, you know, things that have happened, and we need better, you know, policies and so on. You're a little bit more, I'd say. I don't know if optimist is the right word, but you're kind of looking at opportunities and possibilities. Why is it important to have that narrative shift? You know, like, maybe we need a little bit of both. But, the narrative you're putting out there is somewhat, you know, seems to inspire more people. It gets people on board more. You know, the old saying, it's easier to catch flies with honey than vinegar, right? If you look at America, and America is a funny place. It's different than a lot of – different than Europe anyway. Climate is a super-polarizing issue. Clean energy is not. Americans, you know, like, climate they butt heads on. But
you ask Americans, "What's the, your favorite way to get electricity, if you could?" You know, 80, 85% will tell you it's solar. Right? And it crosses state lines. It crosses party lines. It – so, in a sense, when we're talking about punishing polluters, paying more, sacrificing we're talking about how grave the threat is. The threat is very, very grave, actually. But when we fixate on it, it can motivate the true believers. It can motivate people that are already fully convinced. It can, you know, further
engage them, and that has some value. But it's actually kind of scary to people in the middle. People who – it's not absolute climate deniers that I ever really worry about reaching. Those people that are so entrenched in their beliefs, that it's just not possible. But there's a large segment of America, most of America, that are sort of – they’re not climate agnostic, they're just climate low prioritizers. They say, "Yeah, climate change is real, and I've got to pay the mortgage. And I've got to get the kids to soccer, and I've got to, you know, make dinner and so don't – and my life is busy and stressed as it is, and my finances are tight. And so don't tell me about sacrifice
or how things are going to get more expensive." And so to reach those people, these messages of shaming, or what you're doing is wrong, or you're going to have to live a smaller life and give up luxuries that you have today, when they don't feel like they have luxury, are totally politically and sociologically counterproductive. Whereas messages of, "The future is going to get better. You know, clean air, cheap electricity from the sun and wind, a car that makes almost no noise, like road noise dropping, that doesn't stink of petroleum, and it doesn't break down, it's got no moving parts, and like a Tesla-style spaceship that just takes you where you want to go."
Those are things that get people excited. So give them those positive messages and you get people to join you that get scared away by messages of sacrifice. Yeah, that's – I was talking to somebody else, where we were using this analogy of like, you know, early on, the climate conversation is like a doctor who came to you like, "Man you're really sick. You're going to die!” And then they’re just, “But that's all I got!" And they walk out of the room. The second stage is like, "Okay, you're really sick. You could, you could die, and here's the antidote, but it's really going to be painful. There's terrible side effects."
But the reality is like, "Yeah, you know what, you're kind of sick, you're going to get worse if you don't do something about it, but the solution actually is going to make you happier, healthier, richer, you know, and better off in every possible way." I mean, I want to go to that doctor, by the way, you know. Yeah, absolutely. Absolutely. No co-pays. We're going to pay you to get this treatment actually, you know. And I don't know why we have a hard time kind of messaging that solutions to climate change could be an opportunity, not only to improve the economy, create jobs, we've heard that. But maybe even tackle some of our thornier issues around like injustices and equity issues too. If we're clever about it, this might be an opportunity to kind of rethink everything, don't you think? I think we're starting to. But I think that can also get a little scary. In America, the political swings
are driven, as far as I can tell, by the suburbs, right? The the urban core is the left or the Democrats. The rural areas, mostly Republican. And suburban white voters don't necessarily want a gigantic change to the way that America works. But they, do they like clean air, healthy forests, clean water, cheap energy, cheap transport options? Yes. So, do I
think that addressing – that these technologies can help us rectify some injustices? Possibly. I also think climate change itself is grossly unjust. In the sense that the people that will suffer the most, are people in developing nations that are not responsible for climate change, that have had almost no emissions in life, but are the most sensitive to climate and have the least resources to protect themselves. So anything we can do to accelerate the fighting of climate change brings a great justice benefit to the world.
That's a really good point, and one of the things that we sometimes forget is that climate change is grossly unjust today. People who are emitting the most are the best equipped to handle it, and the people who emit nothing are the ones who are going to get screwed. But it's also unjust over time. The people in the future, who've never, they aren't even born yet, haven't emitted a thing, and we're leaving this tremendous burden on all of them as well if we don't start to change our ways. So it's kind of one of the most – it is one of the biggest moral failures, I think, in history. At least, you know, we like to tell the story in America how sacrifice by previous generations allowed us to have a better life, to get a better education and more opportunity. That's the old American dream, right? But leaving a burden on future generations is betraying that dream. It's not really what we should be about.
It's the campfire or like – leave the site better than you found it. And we're not necessarily following that right now. No, we live in a big freakin' mess. But we can clean it up now. Yes, we can give our descendants a gift instead of a problem.
Absolutely. Well, hey, well, thank you so much for your time. I guess we're at the end of our session here, but thank you, Ramez. This has really been great. It has been very, very helpful. Thank you, Jonathan. A pleasure. Great to see you as always.