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♪ ♪ KATKO: Welcome, America, to "Balancing Act", the show that aims to tame the political circus of two-party politics.

I'm John Katko.

This week, we're focusing our energy on energy.

How do we keep up with increasing demand while preserving the environment?

We'll talk with former Deputy Secretary of the Department of Energy, Dave Turk, about the current and future energy needs of the U.S., and two energy experts, Joseph Majkut and Kenny Stein, will join us on the trapeze to weigh in on the energy issue, exploring everything from going all green to finding additional sources to solve the energy dilemma.

Plus, I'll give you my take.

But first, let's walk the tightrope.

♪ America's energy demands are significantly increasing at a time when clean energy sources have become a high priority.

According to the consulting firm Grid Strategies, electricity demand is projected to jump nearly 16% by 2029.

A big part of that surge comes from, you guessed it, the rapid growth of artificial intelligence, data centers, and other tech infrastructure.

Now, adding to that is the push to power transportation through electric vehicles, the expansion in manufacturing, and increasing consumer energy usage due to climate change.

It's safe to say that meeting America's future energy needs will require new and substantial investments in generation, transmission, and storage.

So, the question is, where will that energy come from?

And which path will our leaders follow?

For years, the energy conversation has centered on moving towards clean and renewable energy.

Renewables such as wind and solar encompass 17% of the makeup of our current energy grid, but they only produce 12 percent of our need.

So, with demand growing at a record pace, the conversation is now shifting to include other power solutions from our past, such as nuclear, natural gas and oil, but the stakes are high Worldwide carbon emissions, such as those from fossil fuel production, must be cut in half by 2030 to keep global warming levels below 1.5 degrees Celsius -a rate the United Nations Climate Change Panel already suggests will lead to significant environmental impacts and disasters.

But today, policies currently in place worldwide point to up to 3.1 degrees Celsius of warming by the end of this century.

The United States would have to reduce its carbon emissions by over 43% by 2030 to do its part in maintaining the United Nations goal.

According to the U.S.

Energy Information Association, roughly 84% of U.S.

energy consumption still comes from fossil fuels.

And we need more energy, but we also need to protect the planet.

So how do we balance our need for abundant, reliable power with our need for a cleaner environment?

Let's get some direction from our expert in the center ring.

♪ ♪ Joining me is former Deputy Secretary of the U.S.

Department of Energy, Mr.

Dave Turk.

Welcome, Dave.

TURK: Well, thanks, John.

It's a pleasure to be with you.

KATKO: Thanks so much for coming on the show today.

It's such an important topic.

What are the power needs of this country, plain and simple-current and projected?

TURK: Well, the power needs are enormous.

We're a big country.

We're an economically developed country, of course, which is great.

And our economy is growing.

So what we find is this power is not just electricity.

A lot of times when people think energy, they just think electricity.

But electricity ends up being only about a third of the energy that we use.

Think transportation, think manufacturing.

The big news going on right now, though, is in electricity.

After about 15 years of flat demand in our country, we're actually seeing significant amounts of increases in electricity going forward.

Part of that's AI and data centers, but it's not just AI and data centers.

And how we deal with that and make sure that we have affordable, reliable, and clean power is a big, big deal, and it's something that I've focused on for many, many years.

KATKO: So can you kind of describe for us the dilemma we have here?

Because there's plenty of laudable goals out there where people are striving to have clean energy and reduce the carbon footprint and everything.

That's great.

But then we're running into practical realities of if we don't have a good energy source, we may fall behind on the world stage, particularly with the advancements in AI.

Is that right?

TURK: Well, those of us who are energy nerds kind of look at it with a three-part test that we need to satisfy-all three parts.

First of all, we have to have reliable energy.

It doesn't do consumers any good, it doesn't do a business any good if they can't have power 24/7 that's reliably coming into their business or their home.

Secondly, we need to have affordability.

No one wants to pay more for power than they need to.

It not only impacts folks' bottom line, especially those who can least afford it from a residential perspective, but it's also a key part of our competitiveness.

If we can have cheap energy, we can be competitive versus countries all around the world.

And then third, we do need to deal with sustainability, including the climate emissions as well.

So we need to do all three of these together, and there's tension between those three, and that's where the real-world politics and real-world policy come in-trying to satisfy all three of those, as you say, laudable goals.

KATKO: Yeah, I remember when I was in office, a big thing we were working on was trying to help the nuclear industry in my district from going out of business.

And the conventional wisdom was that there were going to be no more nuclear power plants.

All of a sudden, we're hearing what's called the small modular reactors as a potential solution to some of the problems.

Is that a potential going forward to use that type of energy?

TURK: Well, nuclear is a huge part of our electricity mix right now, especially if you look at that part that doesn't have carbon emissions.

And so when I think of nuclear, I think of it two ways.

One is exactly what you just said-not just in New York, but across the country.

Let's take advantage of the nuclear assets that we have right now, those big reactors that we all see and drive by.

But then there is an opportunity with new nuclear, small modular reactors.

If we can get those prices down, if we can get those costs down, develop those technologies, that can be a really important part of our electricity mix going forward.

We actually spent-when I was at the U.S.

Department of Energy and the current administration as well-spending a lot on fusion energy so that we can harness fusion energy.

That's the energy of the sun.

And if we can really get those technologies in place or at a cost that works for everybody, that could be a big part of the solution going forward too.

KATKO: What about natural gas and oil?

TURK: Yeah, so natural gas and oil still power a lot of our economy-oil much more on the transportation side, and natural gas is a big, big part of our electricity mix.

Natural gas has displaced a lot of coal.

We used to burn a lot of coal for electricity in our country.

We still do a certain amount, but quite a bit less than we did.

And that coal is being replaced both by natural gas, and it's being replaced more and more by renewables, especially solar.

Solar has been the real workhorse on the renewable side over the last several years.

Wind is important.

It's an incredibly important part of the mix in a lot of parts of our country, but solar is an increasingly important share on the renewable side.

KATKO: So on the renewable side, there's been plenty of states and nationally and internationally, there are laudable goals trying to go all green, if you will.

Are we remotely there yet?

Has anyone been able to go all green?

TURK: So we're making a lot of progress.

I'm not sure your viewers focus on the numbers maybe as much as an energy nerd.

KATKO: That's why you're here.

TURK: That's why I'm here.

But we've actually made progress in our country.

We've made progress in reducing our emissions.

We're one of a number of countries around the world that's actually reduced our carbon emissions over the last several years.

Now, there have been some ups and downs-some years we do better than other years.

But overall, we've reduced our emissions, including on electricity.

And a lot of that is replacing coal power, which is quite carbon-intensive, with natural gas and with renewables, and especially with solar being so cheap right now and an increasing amount of energy storage by batteries, but other types of energy storage.

We're reducing our emissions as well.

So we're not reducing them as quickly as the climate scientists say we need to, to do our part to avoid climate change.

We need to work more on that.

But of course, just as you said, we need to have clean power-more and more clean power-but we also need to keep our eye on affordability and reliability in our country as well.

And that's what real-world policymakers, whether in New York or across the country, are very focused on.

KATKO: Are we going to be able to keep pace internationally with other countries?

Because obviously, energy policy is foreign policy.

TURK: Well, we need to, is the short answer.

We need to compete.

We need to compete not only against China, but we need to compete against other countries around the world.

And energy is one of those big input costs.

If you want to revive manufacturing-I come from a Rust Belt community in Illinois, not too dissimilar from some communities in upstate New York.

If you want to compete, if you want to have manufacturing, energy is a key input to it.

And so you need reliable energy, you need affordable energy.

And we're making some progress on that, but I would say we should lean into that even more with policy, with loans, with other kinds of mechanisms, to try to make sure that we can compete.

KATKO: So it sounds like the energy demand is not going to be able to decrease.

Is that right?

TURK: Well, what we should do is use whatever energy we have as efficiently as we possibly can.

In a world of energy nerdness, energy efficiency is probably the nerdiest and least sexy of the topics, but it's also the most important.

It's referred to many times as the first fuel.

If we can be as efficient as we possibly can with our energy, it allows us to compete better.

It allows us to bring those costs down, to have price pressure go down, not up, on energy.

And right now, unfortunately, in the U.S.

and around the world, we are not being as energy efficient as we need to be.

Last year, we saw about 1% energy efficiency improvement.

That's down from about 2% over the decade, from 2010 to 2020.

So we're improving the efficiency of our energy, but not nearly as much as what we've done just a few years ago.

KATKO: It seems like we're somewhat of a paradox from the research I've done with respect to AI.

AI-artificial intelligence-is going to generate all kinds of advancements for us, including energy advancement in ways that we can't even fathom right now.

But in order to generate the AI, we need a lot more energy.

So it almost seems like we need to engage in some short-term pain to get to long-term gain the fruits of AI will bring us.

Is that fair to say?

TURK: Well, AI is an incredibly important part of our economy already, and when you look at the growth opportunity, of course, you got to think of the workers, you got to think of the job displacement, you got to think of different types of jobs and make sure that you're thinking ahead on that front as well.

But there's a lot of economic opportunity for AI.

It is also a big user of energy.

The latest numbers, the best numbers that I've seen in 2023, about 4.4% of our electricity across the country was used by AI and data centers.

That could increase-one of the best estimates out there is by Lawrence Berkeley National Lab-that could increase from 4.4% to upwards of 12% of our total electricity use just by 2028.

Now, that's the higher end of the estimate.

It could be lower than that- 6.7 percent is the lower part of that estimate-but it is projected to use an increasingly larger and larger percentage of our electricity.

That brings upward pressure on prices for everyone if we don't deal with it right.

But I think you're absolutely right, John.

There's a huge upside here too.

AI, machine learning can allow us to be more efficient with our energy use.

It can allow us to explore new ways to make energy, like fusion energy.

AI is a significant component of how we actually deliver on fusion energy-something that's been talked about literally for decades.

AI, with the materials research, with the opportunity to understand the physics of fusion that much quicker and experiment that much quicker, can help us with fusion.

It can help us with geothermal.

It can help us with all sorts of ways to improve the use of energy, but also how we produce energy.

KATKO: Dave Turk, you made sense of a very difficult topic, and thank you so much.

♪ ♪ So which type of energy infrastructure is right for the United States?

And how do we balance this energy need with preserving the environment?

In the trapeze, we're joined by the Director of the Energy Security and Climate Change Program at the Center for Strategic International Studies, Mr.

Joseph Majkut, as well as Vice President of Policy at the Institute for Energy Research, Mr.

Kenny Stein.

Welcome to both of you.

MAJKUT: Pleasure to be here.

STEIN: Thanks for having us.

KATKO: Thanks for having us.

I'm looking forward to a robust discussion here.

So right off the top, are we keeping up with our energy demands right now?

Mr.

Majkut, you can go first.

MAJKUT: I think, you know, in the sense that the lights keep turning on for most people around the country, yes.

But are we keeping up with what we hope the energy system will look like in the coming years as we're facing growing demand from AI and data centers, as we're trying to reshore manufacturing here in the U.S., and as businesses and consumers are trying to get better services and electrify large parts of the economy?

We have a lot of work to do to make sure we can do all of that while maintaining reliability and keeping the system affordable.

STEIN: Yeah, well, I think it also depends on the use in the sector we're talking about.

As already mentioned, in electricity, there is some question about whether we are keeping up.

Certainly today we're okay, but are we going to be okay next year?

That's not at all clear.

But we start talking about transportation fuels or home heating or some of these other areas where, you know, the United States is actually doing pretty well, especially when you compare us to the energy prices that you see in other countries.

KATKO: So it seems like a few years ago, clean energy was the runaway train, if you will, where everyone was getting on it, and we were going to go completely clean energy, and that's all there was to it.

And nuclear was not really in the mix, and natural gas was on the wane.

And all of a sudden, things seemed to be changing where they're getting back to, well, we need nuclear, and we need natural gas, maybe even oil, going forward to try and balance the demands going forward.

Mr.

Stein, what do you think about that?

Is that a legit take right now?

STEIN: Sure, I think that's very true.

And part of the problem is what we were just talking about-electricity demand.

You know, in the previous 20-plus years, electricity demand had been basically flat.

So you could do lots of clean energy, lots of wind and solar, and it didn't really have that big of an impact on your supply situation because there was not a lot of increasing need.

The last couple of years, because of particularly AI and data centers, you've seen this sudden increase in demand, and now it's become a question.

The unreliability and the intermittency of both wind and solar are a problem for things like, especially AI, and that's why people are talking about nuclear again, and they're talking about building a lot more natural gas.

MAJKUT: I think, you know, Kenny's half right, in the sense that we're making progress, progress, and he's half right.

But we face these emerging demands.

I think we make a little too much over the intermittency and reliability associated with renewables.

The bare reality is planners in the electricity system are building renewables as fast as they can, just as they want to build everything else as fast as they can.

And so the national debate really is not sort of what generation do we pick.

It's, you know, can we build enough of anything to meet our demand?

And in that context, you know, our research shows that we're going to be developing more solar, maybe a little bit of wind over the next few years than anything else that you mentioned, John.

They're going to be really important to add nuclear.

It's going to be really important to keep adding natural gas.

But the status of the industry is that the fastest and cheapest thing to build on the margins is solar and then increasingly battery storage.

KATKO: Mr.

Stein, what do you think about what he said?

STEIN: Generally, I think that's accurate.

It's partly a question of what can be built quickly, as he mentioned.

There are delays, certainly for nuclear.

There's delays today for natural gas.

So, yes, if you need rapid electricity addition right now, your solar is kind of the one game in town.

The problem is, of course, that solar is really only a useful resource in certain parts of the country.

In Arizona, California, solar is very useful.

In Massachusetts, it's not.

So this assumption that we can rely on solar, I actually think, is a poor strategic decision going forward, and we should be working on ways to accelerate nuclear development and to accelerate natural gas development.

KATKO: When you say accelerate natural gas development, we already have them, Mr.

Stein.

So what do you mean by accelerate it?

STEIN: Well, the problem is that the holdups right now are often supply holdups-things like the turbines themselves.

And that's a question of encouraging new supply, potentially trying to produce some of those turbines in the United States rather than in China, where most of them are produced today.

So it's about-there's also permitting questions, both for pipelines and for the siting of power plants themselves.

So there are ways that the process can be streamlined for, frankly, not just natural gas, for solar and for nuclear as well, that are very important for meeting future demand increases.

KATKO: So Mr.

Majkut, I'm trying to understand here.

Like a few years ago, we all focused on the green energy plans.

Was it realistic to focus so heavily on green energy without realizing these issues that are coming up?

Or is it just because AI is now this looming storm of demand that we needed recognition of?

MAJKUT: So glad you asked that question.

You know, for the last few years, as green preferences and the economics of green energy changed, we did see huge deployment.

But part of the long-term target here in dealing with greenhouse gas emissions means really growing the size of the electricity system, probably to double what it is today over the next few decades.

KATKO: What do you mean by that, though?

MAJKUT: How much energy you use in the electricity system?

How much you generate, how much is used.

As we shift to EVs, as people use electricity to heat and cool homes and businesses, the demand for electricity goes up, even as the reliance on gasoline or natural gas in buildings may fall, right?

We've for years, and myself included, looked at that load growth and said, we'll be able to manage it.

Now, AI, and to some degree manufacturing, have arrived and have forced us to say, oh my gosh, it's not clear that all that could have happened unless we make some pretty significant changes to the way we permit, to the way we plan our electricity infrastructure in particular.

And if we don't get it right for AI and for manufacturing, we're not going to get it right for almost all of our other national goals.

KATKO: I take it you agree that AI development, Mr.

Majkut, may actually lead us to more energy developments and clean energy sources.

Is that right?

MAJKUT: We expect AI as a demand sector itself to be significant, right, doubling from data centers-about 4-5% of electricity use in the United States now to 10% by the end of this decade.

And on top of that, the economic growth that we hope AI brings for the United States is going to be energy-intensive as well.

By the same turn, AI creates a whole new set of tools for us to use that energy more efficiently in new ways, and to develop more rapidly the innovative solutions like nuclear, like fusion, like geothermal, that we hope are going to allow us to do this really effectively and affordably.

KATKO: Okay, Mr.

Stein, it's pretty obvious from this discussion that we're going to need to have at least a short-term reliance on fossil fuels going forward.

Are you confident that we can do that-use fossil fuels in as clean a manner as possible?

STEIN: Well, certainly, the supply of fossil fuels, particularly from natural gas, really isn't even a question for the United States.

We are not in a position like Europe or Japan or even China, where natural gas supplies are a question.

We have more than enough to last us hundreds of years.

And that's just not even thinking about additional discoveries.

So I actually think that's a big part of this discussion that is often ignored.

People assume that, well, we must do green energy because it's the future, but we need to talk about what is best for the United States, the best for our national security.

And we have these supplies here, and we shouldn't be disregarding this natural advantage that, frankly, we have, that most other countries do not have.

KATKO: Would you agree that at least with respect to fossil fuels, the production and implementation of them in the last decade or two has gotten much cleaner?

MAJKUT: It's been an absolute sea change, not just for environmental progress in the United States, but for our energy security and geopolitical power as well.

Going forward, I think we face two big considerations.

As Kenny says, we have a lot of natural gas.

So how do we want to use it?

Do we want to use it to power our own energy system?

Do we want to find efficiencies there so we can export more?

And when we're exporting more, how is it being used abroad?

Do we want to use it to offset coal and reduce global emissions like we did here?

And how is the U.S.

going to make sure that we're proving ourselves the cleanest and most dominant producer globally?

Those are the key questions we're facing now.

KATKO: All right, gentlemen, that was a great conversation.

I appreciate your points of view, and that's so going forward, our leaders can be as rational with their discussions.

♪ ♪ Discussing energy policy, like many things nowadays, can really raise everybody's temperature.

But let's think about it.

Five years ago, in a previous administration, when clean energy became the big issue, and it was implemented both nationwide and around the country in various states, we didn't have the issues we have today.

Things have changed quickly, with the advent of artificial intelligence and manufacturing demands and data centers.

Our energy use is going through the roof, and clean energy policies just won't keep up with it.

So what do we do?

We have to be smart.

Nuclear power is now back on the table.

Natural gas, especially clean-burning natural gas, is back on the table.

And even oil, that can be done in a clean and efficient way, is back on the table.

My take is we always got to keep an eye on the ultimate prize.

That is a clean energy and a clean environment for our children and our children's children going forward.

But until we get there, we need the bridge of fossil fuels, implementing them, and using them as clean as possible, going forward.

That's my take.

♪ ♪ KATKO: For a look at what's happening next week in Washington, we're joined by Bloomberg's U.S.

Economy Team Leader Reade Pickert.

So what's happening next week?

PICKERT: Thanks for having me.

So thinking about what we're seeing right now, we've seen a pretty solid holiday shopping season, as we've seen many Americans seek to take advantage of the promotions and discounts that we see this time of year when affordability remains top of mind for many Americans.

So thinking about what Americans are working with right now and thinking about as they head into 2026, we've got affordability and prices on one hand and the job market on the other.

So on the affordability front, we've gotten some recent inflation data that showed that inflation slowed, but economists are a little wary of these numbers and how much of an impact the government shutdown may have played in them.

When looking kind of broadly across the economy, we've seen prices continue to rise, especially for things such as groceries, particularly things like meat and coffee, as well as other household, typical bills, like electricity or car repair when compared to a year ago.

You've also seen that things like housing remain quite expensive.

Housing prices remain high, and mortgage rates remain elevated, which has pushed home ownership out of a lot of folks' reach.

Which is what's really the combination of those things-years of accumulated price increases, even if inflation has come down-has really weighed on people and their views of their personal finances.

Then, on the flip side, you have a job market that's been slowing.

So, you know, a large portion of the job gains we've seen this year have really been concentrated in the healthcare sector.

You've also seen some strength, particularly recently in construction and leisure and hospitality.

But otherwise, hiring has been pretty tepid, pretty lackluster.

So at the same time, you've seen the unemployment rate slowly tick up as Americans have struggled to find jobs in many sectors, particularly white-collar sectors.

So when we look at 2026, economists are expecting more of the same-still a relatively rough job market in terms of looking, with a still elevated unemployment rate, but not serious deterioration.

KATKO: So, Reade, I must admit, it's always about the pocketbook issues.

It was last year's election, this year's, and it looks like it's going to be again next year.

Thanks, Reade, so much, and happy holidays, and we wish you well.

Thank you very much.

That's all for this week.

For more Balancing Act, visit WCNY.org for extras and exclusives.

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Thank you for joining us.

And remember, in the circus that is politics, there is always a Balancing Act.

I'm John Katko.

We'll see you next time, America.

♪ ♪