Speaker 1: Bloomberg Audio Studios, podcasts, radio news.
Speaker 2: US Interior Secretary Doug Bergham speaks with Bloomberg's Alex Steele
Speaker 2: at Sarah Weekend Houston. They discussed the need to keep
Speaker 2: coal plants open, gas prices down, and the impact of
Speaker 2: tariffs on energy production.
Speaker 3: Mister Secretary, the unleashing of energy of power?
Speaker 4: What is that? What does that look like? From the
Speaker 4: Interior Department?
Speaker 5: Well, both from Interior, but also I have an opportunity
Speaker 5: to wear two hats in this administration as also as
Speaker 5: the chairman of the National Energy Dominance Council that President
Speaker 5: Trump created by executive order, which contains most of the
Speaker 5: members of the Cabinet Vice chair Chris Wright, and I
Speaker 5: would say what it looks like is it's the unleashing.
Speaker 5: Is is exactly that? I mean, it's cutting through all
Speaker 5: the red tape. We've just come off of four years
Speaker 5: where the Biden administration had a hole of government attack
Speaker 5: US energy, and we're trying to turn that ship one
Speaker 5: hundred and eighty degrees in the other direction and be
Speaker 5: win at the back of US energy as opposed to
Speaker 5: a gale force wind in their face.
Speaker 4: What do you where are you able to do.
Speaker 3: What is your red tape that you can now cut.
Speaker 3: What can the Department of Energy Interior do to that?
Speaker 5: Well, again, going back to the National Energy Dominance Council,
Speaker 5: part of what President Trump fully understands is with this
Speaker 5: whole of government attack that the Biden administration had on energy.
Speaker 5: There was sec rules, there was Army Corps of engineers,
Speaker 5: there was you know, the weaponizing of certain laws like
Speaker 5: US Fish and Wildlife's Endangered Species Act. I mean, all
Speaker 5: of these things coming from different angles. And so we've
Speaker 5: got all the cabinet leaders that are on that, on
Speaker 5: this council to help us unleash it.
Speaker 1: And if we're going to.
Speaker 5: Put sanctions on an adversary like around, we've got the
Speaker 5: State Department, the Treasury Department, they're on there.
Speaker 1: They'll make sure those are enforced.
Speaker 5: We've got Brooke Rollins from USDA because bio fuels plays
Speaker 5: point this, and of course Chris Wright, our fabulous new
Speaker 5: Secretary of Energy and all of the things that are
Speaker 5: going there. And this is not just liquid fuels, this
Speaker 5: is also electricity. And part of the reason why President
Speaker 5: Trump declared a National Energy Emergency on day one is
Speaker 5: because the decisions to tilt so in favor of unreliable, expensive,
Speaker 5: intermittent sources for electricity has put our grid at risk
Speaker 5: at a time when we need to have more electricity
Speaker 5: to be able to win the AI arms race against China.
Speaker 4: That's to unpack there.
Speaker 3: So let's go where you took it, which is alternative energy,
Speaker 3: and one of that is offshore WIN. You've been reviewing
Speaker 3: offshore WIN in terms of the existing leases that have
Speaker 3: already been doled out. Are you any closer to deciding
Speaker 3: if those companies and those projects get.
Speaker 4: To keep the leases.
Speaker 5: They're all under review and including onshore WIN is also interview,
Speaker 5: not just offshore, but we're starting with the offshore WIN
Speaker 5: because of course that's sometimes three times is expensive and
Speaker 5: part of what our goal here for Americans is to
Speaker 5: have lower cost, affordable, reliable energy.
Speaker 1: Right.
Speaker 3: But if the company already has say, power purchase agreements,
Speaker 3: and they already have their contracts lined up and their
Speaker 3: permit being lined up, why would you take that away?
Speaker 5: Well, I think we again, that's part of the review.
Speaker 5: We've been instructed by an EO to take a look
Speaker 5: at all of that. But in some cases, if we've
Speaker 5: gone so far out of balance in certain of these
Speaker 5: rtos regional transmission organizations where we've got too much renewable
Speaker 5: and not enough baseload in that that's part of what's
Speaker 5: putting the grid at risk, and we've got to make
Speaker 5: sure that we've got the right balance.
Speaker 4: Okay, so when do you think the review will be completed.
Speaker 1: We've got an open end on this thing.
Speaker 5: We're going to make sure we do a thorough job
Speaker 5: on reviewing those projects that are underway.
Speaker 4: Well we switch them to other forms.
Speaker 3: A big part of this is going to be obviously
Speaker 3: permitting and be able to move the energy, whether or
Speaker 3: not it's a liquid form, whether or not it's just power.
Speaker 3: If I'm a company and I'm looking at what the
Speaker 3: administration is trying to do, what's the confidence level that
Speaker 3: all of this permitting, legal issues, putting pipes in the
Speaker 3: ground can be done in four years.
Speaker 1: Well, it has to be done sooner than that.
Speaker 4: Usually it's like twenty sometimes for a pipeline.
Speaker 5: Right, Well, those days have to be over because if
Speaker 5: you've got a national energy emergency, we've got to figure
Speaker 5: out a way to actually deliver. In this case, one
Speaker 5: of the things we got to be able to do
Speaker 5: is we've got to be able to deliver low cost,
Speaker 5: clean US natural gas to all.
Speaker 1: Corners of the lower forty eight.
Speaker 5: I mean, we've got a situation now where we've got
Speaker 5: New England states that might be gas prices there might
Speaker 5: be four times higher than Pennsylvania because we can't complete
Speaker 5: one hundred and twenty four mile pipeline across the state
Speaker 5: of New York. So again, if you're in a national
Speaker 5: energy emergency. At the time of the Russian invasion of Ukraine,
Speaker 5: we were offloading four hundred thousand barrels of oil a
Speaker 5: day of thirty Russian heating oil into New England. I mean,
Speaker 5: eighty percent of the people in the state of Maine
Speaker 5: and forty percent of the people in New Hampshire are
Speaker 5: still heating their homes with heating oil. We can do
Speaker 5: better than that for these citizens. They ought to have
Speaker 5: the same right and the same access to LNG that
Speaker 5: someone does in North Dakota, Pennsylvania or Texas. Well.
Speaker 3: Yes, and when I talk to any the company, whether
Speaker 3: it's a pipeline company, an oil company, and gas company,
Speaker 3: everyone feels uncertain, like they don't know where tariffs are
Speaker 3: going to land. They don't have clarity on certain policies.
Speaker 3: They don't have clarity from all the departments, so they
Speaker 3: don't want to make a decision yet. How can you
Speaker 3: give them that clarity.
Speaker 1: Well, tariff's is a separate bucket.
Speaker 5: But part of what we're talking about on building linear
Speaker 5: infrastructure in this country is really a regulatory well, because.
Speaker 3: If I'm going to build a pipeline, I got to
Speaker 3: get the steal an aluminum.
Speaker 4: And that's more expensive.
Speaker 5: Yes, but we should also understand the core principles of tariffs.
Speaker 5: At President Trump, he's been very very consistent, which is
Speaker 5: if a country has got a high barrier in their
Speaker 5: country for the importing into their country of US goods,
Speaker 5: he wants to have reciprocity. And so people can take
Speaker 5: a look, the United States is not going to be
Speaker 5: needlessly or without cause putting tariffs on stuff coming to
Speaker 5: our country unless that other country has also got a
Speaker 5: closed market. And also the other thing that President Trump
Speaker 5: said he's been looking at as he's looking at the
Speaker 5: trade balances, and one of the ways that a country
Speaker 5: can level their trade balance with the US is to
Speaker 5: buy more US energy. And the way we buy more
Speaker 5: US energy is we build those export tournables, removing of
Speaker 5: the Biden export van or the pause on export facilities
Speaker 5: for LNG. I mean, Chris Wright and I were in
Speaker 5: Louisiana last Thursday, six thousand American workers in hard hats
Speaker 5: that wouldn't be working today on an eighteen billion dollar
Speaker 5: expansion if that permit and that ban had not been reversed.
Speaker 5: So we're providing all kinds of certainty in this market
Speaker 5: to people to know that this is a pro business,
Speaker 5: pro energy, pro USA administration and that we need all
Speaker 5: forms of energy to help us drive forward.
Speaker 3: Yeah, you're being a ventro global and the expansion there
Speaker 3: in the Gulf Coast. Speaking of though, in terms of
Speaker 3: oil and gas leases, for example, if workers who actually
Speaker 3: approve leases are being let go or if feeling Musk
Speaker 3: is targeting them for doughs.
Speaker 4: Does that make your job harder? Well, get those leases
Speaker 4: done well.
Speaker 5: First of all, the has been clarified by the President
Speaker 5: that each Cabinet sectary is in charge of their downsizing
Speaker 5: efforts within their agency, and we welcome the support and
Speaker 5: help of the additional resources of a DOGE team that's
Speaker 5: digging in and looking really for on the cost side.
Speaker 4: So you have had to lay off anybody, we've.
Speaker 1: Made a decision. Not had to, but we've made a decision.
Speaker 5: I mean there's I mean, obviously we've got a right
Speaker 5: sized government. It's not it's bad for the interest rate markets,
Speaker 5: is bad for the world, it's bad for every American,
Speaker 5: it's bad for future generations. If we think that it's
Speaker 5: sustainable to spend two trillion dollars more, two thousand billion
Speaker 5: a years.
Speaker 1: Extra is what we spent last year.
Speaker 5: So I mean, the vision is we've got to drive
Speaker 5: revenue up, and we got to drive additional one trillion
Speaker 5: of revenue, additional one trillion cost savings is the path
Speaker 5: to a balance budget. Well, the Interior Department, we've got
Speaker 5: the biggest balance sheet in the world. Five hundred million
Speaker 5: acres of land, seven hundred million acres of sub service,
Speaker 5: two billion acres of offshore acreage. All of that's got
Speaker 5: revenue possibility, and not just an oil and gas but
Speaker 5: timber and grazing leases, and the under the Biden administration,
Speaker 5: the revenue in Interior was on a decline. If this
Speaker 5: was if Interior was a hedge fund, it would be
Speaker 5: the largest balance sheet in the world, and we would
Speaker 5: have the poorest returns of any company in the world.
Speaker 5: I mean this is this is a turnaround opportunity for
Speaker 5: us to drive revenue up. We want to make sure
Speaker 5: anybody that's involved in getting permits done they need to stay.
Speaker 1: People who've been involved in.
Speaker 5: Blocking permits are people who've been participating in illegally not
Speaker 5: holding the required lease auctions that are required by law.
Speaker 1: They probably don't need to stay.
Speaker 4: Okay, that's good clarity.
Speaker 3: So let's pivot just before we let you go to
Speaker 3: say coal and nuclear and steps to be taken to
Speaker 3: prolong the life of coal plants and nuclear plants, which clearly,
Speaker 3: if you're above all energy, you're going to need those.
Speaker 4: Where are we in that right now?
Speaker 1: Well?
Speaker 5: Absolutely, We've got two sources of baseload that have been
Speaker 5: neglected and sometimes demonized, and that's coal and nuclear. And
Speaker 5: if there's a coal plant still running in the US,
Speaker 5: it's among the cleanest in the world. And China last
Speaker 5: year opened up a hundred gigawatts of new coal. India
Speaker 5: on a similar track. They understand that we've got billions
Speaker 5: of people that don't even yet have electricity in China
Speaker 5: in particular, understands they need baseload to be.
Speaker 1: Able to win the AI arms race.
Speaker 5: They're also got thirty new their plants under construction and
Speaker 5: they're spending hundreds of billions of dollars on hydro.
Speaker 1: So in the US we've fallen behind on energy production.
Speaker 5: Now we've got real demand from people that are willing
Speaker 5: to pay for and that's the hyperscalers. The five big
Speaker 5: tech companies have a three hundred billion dollar capex budget.
Speaker 1: This is the largest.
Speaker 5: Their capex budget is bigger than oil and gas, bigger
Speaker 5: than automotive, bigger than steel, bigger than any other industry.
Speaker 1: And what they want to spend it on is they.
Speaker 5: Need electricity to drive that because this is not ANAI
Speaker 5: data center.
Speaker 1: Is not like, oh, we're going to process healthcare claims.
Speaker 1: I mean that's important work. It's just business back office processing.
Speaker 5: In an AI data center, you're actually manufacturing intelligence, and
Speaker 5: that intelligence now becomes the highest value product we've ever
Speaker 5: created with electricity since electricity was invented.
Speaker 1: So the demand for that is going to be real.
Speaker 5: We've gone through decades of almost no demand increase. The
Speaker 5: entire time that I was in tech, we used one
Speaker 5: percent of the nation's electricity, even as the tech sector
Speaker 5: was growing. Because everything was becoming more efficient now we're
Speaker 5: in a spot where we've got real demand growth. We've
Speaker 5: got to meet that demand growth, and we've got to
Speaker 5: meet it with reliable, affordable baseloads.
Speaker 3: And that's not even the entering part, the inference part
Speaker 3: of it, which is going to be even more so.
Speaker 3: What's the mechanism that you guys can use to keep
Speaker 3: the coal plant open longer, the nuclear site open longer.
Speaker 1: Well, we can.
Speaker 5: First we can stop death by regulation, and part of
Speaker 5: that we can do by taking a close look at
Speaker 5: the actual legality of some of the rule making that
Speaker 5: was perpetrated against these these industries. And I think as
Speaker 5: part of under the National Energy Emergency, which President Trump
Speaker 5: has declared, we've got to keep every coal plant open,
Speaker 5: and we've got to and if there have been units
Speaker 5: had a coal plant that have been shut down, we
Speaker 5: need to bring those back on, not just when it's
Speaker 5: zero degrees.
Speaker 1: Or twenty below.
Speaker 5: I mean, we've had days On the day that President
Speaker 5: Trump was a NAUGA in the entire PGAM market, which
Speaker 5: is thirteen states from New York to Virginia, five AM
Speaker 5: of January twentieth was the highest peak load for the
Speaker 5: winner zero from solar because it was five am.
Speaker 1: It was dark out.
Speaker 5: Two percent from wind, seventy percent from fossil fuels, twenty
Speaker 5: two percent from nuclear.
Speaker 1: So if somebody says, hey, we don't need.
Speaker 5: Fossil fuels or nuclear, it was providing over ninety percent
Speaker 5: of the power on that particular day for some of
Speaker 5: our most populous areas. I mean, the only thing would
Speaker 5: be running would have been a hospital with a diesel
Speaker 5: generator if you didn't have based load fossil fuels.
Speaker 1: We're not in a period of energy transition.
Speaker 5: That is one of the big lives of the climate
Speaker 5: extremists is energy transition.
Speaker 1: We're in a period of energy audition.
Speaker 5: We need addition for the billions of people that don't
Speaker 5: have electricity, We need additions for AI, we need additions
Speaker 5: in supply to keep the prices down. And if we
Speaker 5: want to bring manufacturing back to the United States and
Speaker 5: reindustrialize our nation and not make the mistake that Germany
Speaker 5: and the UK are making right now deindustrializing with electric
Speaker 5: electric prices in Germany or triple what they are here
Speaker 5: in the United States.
Speaker 1: And so we're on.
Speaker 5: A path under President Trump to reindustrialize the US, bring
Speaker 5: manufacturing home, bring investment back, and it's working.
Speaker 1: Look one point.
Speaker 5: Seven trillion dollars of capital flowing back to the US
Speaker 5: in the last six weeks because they know we're committed
Speaker 5: to a policy of providing abundant, reliable, low cost energy
Speaker 5: a TVD.
Speaker 3: IF that includes solar and onshore and offshore wind, well,
Speaker 3: I think that those are We know that offshore wind,
Speaker 3: for sure, is three times as expensive and it's intermittent.
Speaker 5: So if you're trying for reliable and affordable, it wouldn't
Speaker 5: meet either of those criteria.
Speaker 2: US Interior Secretary Doug Bergham speaking with Bloomberg Zalx Steel
Speaker 2: at Sarawek in Houston,