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Katherine Blunt

Reporter

Wall Street Journal

December 21, 2021
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Ep 54: Katherine Blunt - Reporter, Wall Street Journal
00:00 / 01:04

Bret Kugelmass
We are here today with Katherine Blunt, who is an Energy Reporter at The Wall Street Journal. Katherine, welcome to Energy Impact.

Katherine Blunt
Thanks for having me.

Bret Kugelmass
Super excited to have you here. I just read your most recent article, very topical. I used to live in California and so this is definitely of like primary concern to me. But before we get into the work that you do today, we'd love to just learn a little bit about you. Can you tell us a little bit about yourself? Where'd you grow up? And how did you become a reporter?

Katherine Blunt
I grew up in Maryland and it's really something I've wanted to do since I was very young. I was the consummate high school journalism nerd and then I went to college and studied journalism and history also, but I knew that I wanted to be a reporter. And after school, I started at the Express News in San Antonio. I covered transportation, which was a lot of fun. It was a great beat to have right out of school. I mean, San Antonio is a big city, but has a very small-town feel, so it was good to get to know everybody and understand how they were addressing these issues of urban development as the population grew. Really exciting. And then I moved to the Houston Chronicle and I was a business reporter there for almost three years. Covered a wide range of subjects, perhaps most notably a deep dive into the business of Joel Osteen's mega church. That was fun.

Bret Kugelmass
And what- do you do features? Do you spend months digging into it? How does this type of reporting differ than- yeah, just actually walk through the basics of reporting, even to us. What are the different types of articles?

Katherine Blunt
Absolutely, I mean there are a number of different kinds. A lot of what you read on a day to day is stuff that takes maybe less than a day to write, or maybe a couple of days depending on the nature of the subject. But the ones that are the most fun to me are ones that take really months of talking to people and digging through documents. So you do that for quite a long period of time. And then sometimes the editing process can take almost as long, kind of depending on the subject. In this case, this was kind of a three-part series. And it was a feature- I mean, it was feature writing. There's almost a different element there and making it read as nicely as it is deeply recorded. So that was a lot of fun. And you flex a different set of muscles when you do that kind of work. Then I joined the Wall Street Journal in November of 2018, just a few days before the Camp Fire. I was hired to cover renewable energy utilities. And so all of a sudden, the largest story in the utility world and one of the most significant stories in the US is happening in real time.

Bret Kugelmass
And where was the Camp Fire for our audiences?

Katherine Blunt
It was Northern California. It destroyed the town of Paradise in the Sierra foothills. And so it was pretty soon after the fire started that it became clear that it was likely caused by one of PG&E's powerlines.

Bret Kugelmass
And how did they know that? Like, what makes that so clear?

Katherine Blunt
When the utility experiences a disruption in one of its lines, it has to file a report with regulator that indicates what the problem might have been. And you can't draw a definitive conclusion at that point in time that the power line started the fire, but you can kind of read between the lines. It takes a few more months before the State fire officials to finish their investigation, but in this case, it was pretty evident from the start. And so it launched what became more than a year of reporting on this company, with two close colleagues of mine,

Bret Kugelmass
What's your structure? On something that- and okay, first, let me ask the question: did you know that it was going to take a year? Or is it something just kind of like built and built and built?

Katherine Blunt
I think going into it we were basically given the directive to just look as much as you can, go as deep as you can on this company so that we can explain to our readers what the root of the problems are here. And it's not a simple story. And I think it was- I think we knew that it was going to take a long time. Shortly after that fire started, PG&E filed bankruptcy protection. So you know you've got a protracted process there and you're gonna follow that through to the end, to the extent that you can bring to light some of the historical dynamics that led to the circumstances. You're doing public service.

Bret Kugelmass
And what happens like in the newsroom? Do you tell your editor, Hey, I've got to shuffle my- like do you still work on other articles? Or how do you shuffle your own responsibilities at that point where you're about to like dig into something big?

Katherine Blunt
Well, I certainly still have responsibility for the daily news that would come forth about PG&E and whatever it was doing with the filings. Our bankruptcy team took care of a lot of the bankruptcy related news, but as it related to issues with the regulator, different hearings, their criminal probation related to another issue of gas pipeline explosion in 2010, there was-

Bret Kugelmass
I remember that, too.

Katherine Blunt
-about that as well. So you know, still responsible for the day to day. And then- but given a lot of time and a lot of space to go deep and kind of those off momentum, those off days. I wasn't doing a lot outside of PG&E at that time. I mean, there were some things here and there, but not much. Our directive was really to focus on the company. And that was a really great gift, because I think we were able to do good work.

Bret Kugelmass
Yeah, it's amazing. Do you- now, what's your structure? Do you like get a big whiteboard and say, Okay, we're going to map out who are the directors? And what's their role? I mean, or like it's a free forum, just I'm just gonna start calling people and then like, after a month, we'll regroup? What's the strategy?

Katherine Blunt
In this case, I'm working very closely with a couple of other reporters, who some- I'm sure some listeners know Russell Gold and Rebecca Smith. We had a lot of shared documents. We had like a shared spreadsheet in which we had just lists of people, different types of people that we wanted to call and we divided up who was going to do that. Everything got uploaded to Document Cloud. And I know that- I think Russell had his own way of mapping out things on the wall. I took over the conference room in our small office and just had everything spread out. So it was- I think that oftentimes journalists aren't known for excellent organizational skills and this was definitely evident, but we somehow made it work.

Bret Kugelmass
I think that's pretty incredible. And how many times do you like requestion what the story is throughout the process of writing it? Are there new developments that you think are immediately like, Oh, my God, we've got to change what our focus is? Or just a natural accumulation of evidence makes you think, are we looking at this differently?

Katherine Blunt
Yep, absolutely. I think that there were a couple of different points that were pretty salient when you're asking that question? Because at first, you're kind of like, what are what are we looking for? You know, we're looking for anything that can help explain what happened in some sense, whether it be you know, the, the immediate question of why did this happen, or kind of the overall historical question of what transpired that allowed this to happen? There was one instance and in which Russell to his great credit was going through just an incredibly long for filing, it was one of the transmission owner filings. And he came across something that indicated that there was supposed to have been some work done on the line that started the Camp Fire. And then it was ultimately delayed and delayed again and delayed again. Because he's like, I think I found something that can look at this. And it's like, yeah, that seems like something that we should take closer look at. And then that sort of changes the reporting track at that point, not only looking at that particular thing, but other instances in which there's projects on other lines that were delayed or pushed back are not done, for whatever reason, and those first filings ended up being extremely fruitful in that way. Same thing with some records requests that came back. And then I think that the most comprehensive story that we did, wasn't so much, there wasn't a big reveal, as in, you know, there was work on this line that got delayed, it was just what we hoped was a very comprehensive account of what happened over the last 20 years that, you know, maybe made the made for the current circumstances. And that's a totally different process. I mean, it's just a constant conversation about sourcing and, you know, sort of the, our understanding of the historical dynamics, and how do you best present that in a pretty tight way, given that we're, you know, we're a newspaper, you get about 5,000 words. So it's, it was a hugely it was, it was a fantastic learning experience for me to say that.

Bret Kugelmass
Yeah. And, oh, man, there's so many different ways I want to take this, but I guess one that's based on something you just said, what were the reasons for the delays? And like, were they legitimate? Or did you notice, overall, like a pattern of bad behavior in some way or another?

Katherine Blunt
Yeah, I think in this case, it's a good question. And it's one that we probably didn't arrive at a super satisfactory answer. But what I think is that- what we concluded just over time, the company had a very difficult time deciding what needed to be done when. Part of it - not all of it - was that it was largely focused on the lines that served the most people for the liability reasons. You have one of those lines goes down and you have millions of people without power, that's a problem. But some of these lines up in the Sierras, they don't- it's not a very population dense area, so if something goes down, the reliability impact is lower. And of course, like many other utilities, PG&E has historically struggled with having good information on the state of various pieces of equipment. It didn't know the extent to which there were problems on certain lines. And the nature of these projects was such that they didn't, I think, really see it as something critical that needed to be done from a safety standpoint, even though it would have improved the overall health of the infrastructure. Unfortunately, there's not really a simple answer. But I think just issues with prioritization is the best way to sum it up.

Bret Kugelmass
Can I ask like a dumb question about powerlines?

Katherine Blunt
Yeah, of course.

Bret Kugelmass
I can imagine that it's more expensive to put them underground than it is - especially over mountains and stuff - than it is to put them overhead. But how much more expensive? And when you weigh like the potential damages - and I don't even know how you measure the cost of lives loss, but I'm sure some actuarial guy- I don't know. How much more expensive could it possibly be to dig a couple feet, lay some pipe, dig a couple feet, lay some pipe? How hard could that be?

Katherine Blunt
Yeah, exactly. And this is a really, really relevant question right now, because PG&E has just announced that it's going to underground 10,000 miles of distribution wire over some span of time that they haven't quite determined yet. But their contention at this point is that they've started doing this in Paradise, which is the town that was destroyed by the Camp Fire and so they're learning that they can do it a lot more cheaply than they initially thought. I mean, in some cases, perhaps- this might be a little bit off, but maybe half as much as they initially thought in terms of miles underground. It historically has been- most utilities really do believe that it is expensive to retrofit the overhead system in this way, because it requires just a lot of upfront cost in terms of engineering and assembling all the labor needed to do all the digging. And then there's the question of if there's an issue on the line, it might be harder to fix because there's digging involved and there's just a whole different way of going about maintenance. Of course, the obvious benefit is that a tree can't fall on a wire that's underground and take it out. That's huge. So if you're weighing that PG&E case against the constant cost of trimming trees, constantly keeping these things that are- it's a dynamic risk, right, trying to address that. And the fact that the consequence of single spark is so high right now and can carry so much potential liability costs, I mean, the cost benefit analysis there gets pretty complicated. And this could be a game changer for them if they can pull it off. But right now the estimated price tag is $20 billion for these 10,000 miles of lines. And they'll have to continue to do other safety work in the interim as they're trying to figure out how to do it. So it's going to come down to how much the regulator's gonna authorize.

Bret Kugelmass
Yeah. And does that line of reasoning that I just went down, is that something that you- like when you're reporting, do you ever have different branches that you say, Well, wouldn't it be interesting to explore this topic? And could that topic even turn into its own feature of some sort where it's like, you know, why don't like- just a whole article on why don't we move towards a totally underground system. And then the PG&E almost becomes a small part of that, instead of the other. Do these thoughts go through your head?

Katherine Blunt
No question, and especially this year because you think about the amount of stress that we've seen on the grid in various places in the US, whether that be the heat wave in the Pacific Northwest - or heat waves - Hurricane Ida, which had impacts in both New York and Louisiana, Texas freeze. Just all kinds of strains that I think are- were exacerbated by climate change in some respects. And I think that we all anticipate that that's going to continue to be the case going forward. Also there were a lot of storms over the summer in Michigan, wildfires in Minnesota. I mean, just the various things that might prompt you to reconsider whether the overhead system should continue to exist in its current form. It would be a great idea, I think, in light of everything that's happened this year to look at the way that that conversation is evolving and how you- whether the cost benefit analysis begins to change as a result of all of this.

Bret Kugelmass
Yep. And so you did all this- you did all this reporting. I'm sure you learned a tremendous amount about California and about PG&E. Where does this story go next? You have book coming out?

Katherine Blunt
I do, I do. So I sort of used our reporting over that year plus as a springboard for a book about the company and about the very dynamics that we're talking about. It looks very closely at 20 years of history, but there's also a chapter that goes all the way back to the beginning of the 20th century in which some of this infrastructure was built out. Some of the oldest parts of the system were developed to support hydroelectric development in the Sierras. It was very interesting. It was a very- it was a time of exploration and like romanticism and experimentation and that's a great legacy. But it also has presented a huge challenge for the utility at this point in time to have all these really, really old lines running through forests that have been devastated by drought. And so there are a lot of issues with- a lot of internal mismanagement within this company over the years. A lot of negligence in the sense that poor decisions were made and they didn't really realize the extent to which they were poor decisions until later. But there's also a lot of issues - regulatory issues, political issues, and just environmental issues - that deserve just as much scrutiny, so the book attempts to weave all that together.

Bret Kugelmass
Yeah. Does it have a title yet? Just so we don't forget.

Katherine Blunt
Yeah. "California Burning: The Fall of PG&E and What It Means For America's Power Grid."

Bret Kugelmass
California Burning, that is quite a title. Okay, but it does bring up like a larger issue almost. So the utilities have this public good. They're also highly regulated in ways that other businesses aren't. Is there proper oversight? Does it vary from state to state? Like are we talking about a more systemic problem? And after you having done all this research and really diving into it, what are your personal opinions on just the state of energy regulation overall?

Katherine Blunt
It's a great question. It does vary. It really significantly varies state by state. In general, state utility commissions generally have the most oversight over the operations of a utility. And a lot of these are investor-owned utilities of sort of different subsidiaries based on the states in which they operate a lot of the time. But, of course, one thing that has really been a challenge for the California Public Utilities Commission over the years is that they had a lot of resources dedicated to policy, in pursuing the state's renewable energy goals and making sure that the utilities were doing- were helping in that effort by procuring more wind and solar power. There just- there weren't a lot of resources dedicated to this oversight of the system from a safety perspective. That was just something that was really hard to build up. That division didn't have a lot of cachet in terms of resources and have the resources to really oversee the safety of, for example with PG&E, the system covers 70,000 square miles. And so they're mostly just auditing records. They weren't really going out and looking at the equipment. And so in that case, you're really relying on the information the utility is giving to you. I think you certainly would have a similar dynamic in many other states. What's interesting, too, is a couple of decades ago, there was a push toward deregulation, making it so that the utilities were no longer the primary owners of power plants, so that there could be two different competitive markets throughout the country. That played out in different ways in different areas. But one legacy of that is that oversight of transmission specifically is pretty fragmented. It's like kind of at the federal level, it's kind of at the state level. And for that reason, I think that there hasn't been a huge amount of attention paid to the extent to which- like the health of the high voltage system. There are a lot of challenges there. And I think that they're going to become more acute.

Bret Kugelmass
Do you think that- like to me, everything comes down to like incentives. Do you think that the incentive structure for the person at PG&E, or whoever the transmission operator might be in any scenario, are they properly incentivized to wake up every day thinking, How do I make sure that this system operates the way that it should? And when I say incentivize, I mean, not just the carrot, but also the stick. Like they wake up thinking, I'm going to be in real trouble if the system fails. Or do they think that, Well, I'm an independent engineer report from a well-known company to stamp off on it, so I'm protected if this ever goes to court. Where does it sit in that?

Katherine Blunt
This is a really good question. I'm just gonna use PG&E as an example, but I think that- I mean, this is a very broadly applicable question. So first of all, I think that without question, PG&E - which has been through hell and back in the last 10 years or so - understands better than it's ever understood before the risks throughout the system. I think that there's a big incentive for everyone who works with that company today to wake up and say, We are going to try to make this as safe as possible, given the amount of destruction that's occurred over the last several years. Now, that's not the case for every utility, because oftentimes it takes disasters to call into sharp relief the extent of the problems that they face, the risks that they face. But the question is, in terms of incentive, they have to balance so much at once. I mean, the nature of an investor and utility is such that you do need to deliver to Wall Street in order to be able to raise necessary capital to invest in the system, so that you want to be making decisions that are accretive to shareholders, right? But then there's also the full maintenance side that is expensive by nature. It's just- it's not something on which they earn returns. And so they have to just strike this balance and there are finite resources. Maybe that's because a case before the regulator didn't yield as much money as they were hoping. Or there's an issue in some other division that's kind of sucking up a lot of cash and cuts have to come from some other place. And so they have to- and when you think about the nature of a utility organization, you've got all these different divisions, all of these different people kind of making the best decision that they can make with the information that they have, but they often can't see what the others are doing. And so then it becomes hard to have, I think, any individual decision maker have a holistic view of the risk profile and how their decision or maybe a decision to cut corners just a little bit is in pressures that they face, accrues to become something much bigger than themselves and the decision that they just made. So I think that the incentives, I don't think anybody wants for the equipment to fail with potentially destructive consequences. That's- it's not something that anyone wakes up and is okay with happening. They're all safety-minded people, but they have a lot to balance. Does that answer the question?

Bret Kugelmass
I think the summary of your answer is it's very complex, like even the- very complex. And I think that does answer my question perfectly. It's not very satisfying to what's the right answer, but it is the appropriate answer.

Katherine Blunt
A quick aside, what's interesting with PG&E, just almost as like a broader topic of interest, is that it's several times been- it's faced federal charges for first, it was violating federal pipeline safety laws. And then, as many listeners probably know, the company ultimately pleaded guilty to 84 counts of involuntary manslaughter for its role in the Camp Fire, because it was determined it was recklessly negligent in maintaining the transmission system.

Bret Kugelmass
I was gonna say, Well, what does that mean, a company pleading guilty to manslaughter? Go to jail?

Katherine Blunt
Exactly, so this question of corporate liability. In both cases, the prosecutors who are pursuing these cases were like, Who is at fault here? And in both cases the answer is nobody really. I mean, no one individual is at fault. Taking in aggregate, their actions are enough to indict the corporation. But it's- when you look at the way that decisions were made and the knowledge that individuals held about the risks, you can't point a finger at someone and say, This was this was your doing. Someone put it nicely to me. I mean, these are crimes that were not- it's not a crime in which someone pulled the trigger. It's a crime committed over the course of decades. And it was just like decision upon decision that just ultimately resulted in catastrophe.

Bret Kugelmass
Yeah, but I don't like that. Because, I mean, not that I want to like see people burned at the stake or anything, but I do- to me, that doesn't- that's not enough to change this from happening in the future or in some other place. Because, yeah, it's just- it's not enough, because it might just be that the utility kind of attracts a certain type of people. The investors don't expect it to make that much money. And then these things just go on. It doesn't have all the right dynamics of a company where everyone wakes up and thinks either the company's success - like true success is my responsibility - or the company's failure is my responsibility. And then like, people take their job- listen, I'm sure people take their job pretty seriously there. But there's a difference between that and pulling your hair out in the middle of the night thinking, I've got to make sure there's no fire ever again, which I'm sorry, it's stressful, but that's the job I want you to have if you work there.

Katherine Blunt
Yes, yes, yes, yes. And I think that right now, the executive team at PG&E just as an example really feels that way. Like the buck stops with them and they're trying to do a lot more to really have a granular knowledge of what's going on beneath them. I think that is definitely true. But to the extent that this is not just about PG&E, because it's not. I think that it takes a while for an organization like a utility to arrive at that mindset. And if you begin to see more risks inherent throughout any given utility system and they're plagued by the same sorts of problems and an inability to assess it until it's absolutely critical that they do some sort of records overhaul or operational overhaul, it's gonna take a while to change that kind of culture. I think that's a potentially very scary thing.

Bret Kugelmass
Yeah. Tell me about the introduction of renewables onto the grid and just kind of the broader push towards clean energy and how you see this actually impacting the grid moving into the future. Is this going to make things worse or better? I mean, I can see distributed means less transmission is necessary, but if it's intermittent, you need more transmission to move the electrons around. Where is this all going?

Katherine Blunt
Well, I think in terms of simple worse or better question, it will make it better, because I think that there's an imperative to reduce carbon emissions. And this is a big piece of the puzzle. It's not the only one by any stretch. But in terms of the intermittency issue, there are going to be some very interesting challenges over the next few years. And California is a great case study, because there's a very ambitious target to decarbonize the power grid by 2045. So what that means is it's gonna require a huge amount of new wind and solar generation as well as - critically - battery storage to store that power and to dispatch it when either the sun isn't shining or the wind isn't blowing or there's some other issue that's made it so that the renewable generation portfolio isn't producing full capacity. PG&E and as well as the other two large utilities in California were leaders in this respect over the last couple of decades. They began bringing a lot of this type of generation online well before the utilities in the country. There are some consequences of that, because at the time wind and solar power were really expensive. But they were procuring so much, they were helping to drive down costs for other utilities. And right now what you're seeing is, I mean, this is largely market driven at this point. The cost of wind and solar has fallen so far, so fast. And it's absolutely some of the cheapest generation out there at this point in time. That's a good thing. Battery costs are also falling, but it's still somewhat of an expensive proposition, depending on what type of project you're considering. That being said, the trajectory is only trending downward. It's only becoming more cost competitive. A big question mark that kind of hangs over the sector is the state of long duration storage. Right now, most battery projects are gonna- they are four hour batteries. So maybe you can have a fleet in which you kind of discharge one and discharge the next and discharge the next to get you through a long period of low wind, low solar. But most people agree long duration storage really has to be part of the solution and you're beginning to see more commercial pursuit of this at this point, with some really interesting companies with potentially very viable products. But it's just- we're just not there yet.

Bret Kugelmass
And one thing that I'm worried about is that while the cost of the equipment might decrease with scale, cost to the grid operator might increase with penetration. So like it's way different handling a grid with 20% renewable penetration than 60% renewable penetration. And then like coming back to the whole transmission conundrum, I feel like costs might start going up at some point, as well, even if like the cost of panels and battery packs go down. I'm a little worried about that. Does the reporting that you do take any look at that, like really future penetration scenarios of like 60% plus and what that means for the grid?

Katherine Blunt
Yeah, I think that- I probably can't answer that as precisely as I would like. But I think that the concern that you're outlining is very valid. I think that what is pretty clear, I think, to me - at least based on the reporting that I've done - is this is really a speed question, right? I mean, a lot of this has to be developed in a very short span of time. And then in the case of California, you've got these other pressures in the sense that they're about to retire the Diablo Canyon Nuclear Power Plant, the last nuclear power plant.

Bret Kugelmass
I want to talk about that. I want to hear your thoughts on that.

Katherine Blunt
Yeah, I'm sure you do. And then also a fleet of natural gas power plants that operate in the southern part of the state. So you've got a huge amount of generating capacity that's going offline in the span of a couple of years. Not only do you need to replace that, but you need to build upon that and augment that with battery storage, right? So the amount of new generation and storage that needs to come online in the next couple of years, it's just- it's kind of like a mind blowing amount. It's going to require all the pieces to fall just perfectly into place. No big supply chain snafus - which is like- we're clearly seeing a lot of that around the around the world - no big cost hurdles, and so it's like- and also just the means of assessing projects to queue them up and connect them to the grid. That's a long study process.

Bret Kugelmass
Okay, that's the other thing you brought up in your most recent article that drove me insane. It was like when you were talking about the interconnect period of time and why that's so long. To me, that is the lowest hanging fruit. Why is that not like- why don't we just pass a law that says, instead of taking years, it takes months? Like how hard could that be?

Katherine Blunt
I mean, resources, right? Resources. But they have opened a proceeding to figure out how to cut through some of that, kind of cut through some of that tape. So hopefully that is low hanging fruit.

Bret Kugelmass
Do you watch Bill Maher ever? He had this like days ‘til solar. Did you see this thing where-

Katherine Blunt
I don't know, tell me.

Bret Kugelmass
Oh, he was- you know, he's a rich guy. And he's very environmental, so he installed a lot of solar on his property. I guess more than the normal amount, maybe, but he needed like a shed that connected it and whatever. And he had it like all installed and ready to go for years, but couldn't get the final documentation sign off to get connected to the grid. And he was keeping quiet about it for a while, because he's very pro-environmental, didn't want to like raise a stink about this, but eventually got to the point where he's like, I need to use my celebrity power just to get California to sign the paperwork. And I'm like- alright, so that's the problem. Then you mentioned the interconnect in your article as well. And I'm like- I'm looking at this and I'm like, if California is really serious about a move towards more clean energy, you've got to solve the non-technical issues as fast as possible, because they're low hanging fruit.

Katherine Blunt
I agree with that. And hopefully that resolves itself in due time, or not in due time. Quickly. Hopefully it resolves itself quickly.

Bret Kugelmass
And you mentioned in your article, we're talking about like hundreds of billions of dollars to overhaul the California grid.

Katherine Blunt
Yeah, I think that- so the cost thing is a bit hard to nail down, because the procurement process is ongoing. No knows exactly how much this particular procurement order is going to cost to execute. But some studies have been done the last couple of years in terms of what it's going to cost to achieve the State's carbon reduction goals. Yes. I mean, billions of billions of dollars. I mean, whether that be in terms of the departments and the power grid itself or in pursuit of heightening EV penetration, building electrification, all the major things that are going on right now.

Bret Kugelmass
I'll lay out my bias. I'm very pro-nuclear and it seems to me shutting down Diablo does not help with that goal. What's going on? Why aren't we building forty of them?

Katherine Blunt
Yeah, you've got a generator that's supplying nearly 10% of the state's electricity carbon free. It's already in the ground. It's already built. So the question at this point is I guess- I was probing this question, like why not? Why not just keep it open? And the resounding answer was like, What's done is done. The ship has sailed. We can't pursue relicensing with the NRC at this point very easily. I've heard rumblings that there are some that actually want to mount a more serious challenge to the extent to which this is actually true. But I think that even from a regulatory standpoint, the PUC already signed off on the decision to close it. And so it's not just a federal licensing issue. There is also an issue with the state regulatory process and having to turn back the clock on that, they'd have to open a new proceeding. That could just be very slow. So what we're talking about is just a lot of bureaucratic hurdles. And could they be overcome? I don't know. I don't know. I mean, it would have to take a really-

Bret Kugelmass
Well, you tell me, because you have probably the best insight into this more than anyone, just how important California electricity is. So you tell me. How important is 10%?

Katherine Blunt
I've heard it might be possible for them to get a short term extension on the license while they go through the bureaucratic process of keeping it open. That being said, there would be a lot of political pushback, because this is a very unpopular generator. People have concerns about nuclear energy, as you know. And there's plenty- I mean, I think certainly after Three Mile Island- I mean, the safety of this plant is is quite high. The nuclear industry is very safe. And so I think that those concerns could potentially be addressed if people can rationally process them. But that's a big if. So I think that it would be it would be very politically challenging. And I think it would be challenging from a bureaucratic standpoint. It's probably possible, but it would take a lot of will, from not only the PG&E, but also state regulators, state politicians, and the support of the feds to do the sort of short term stuff that you need to do to keep this open while going through the formal process of relicensing.

Bret Kugelmass
All right. I want to switch gears for a little. Tell me about just broader energy issues overall. Where's your beat going next? Are you gonna continue to focus on California? Are you take a more global perspective? How does the Wall Street Journal actually even divide up energy? Who reports on what?

Katherine Blunt
Our energy team is based in Houston. I recently relocated to San Francisco, just because it's closer to a lot of the folks that I talk to on a regular basis. So it's myself and then my colleague, Jennifer Hiller, also was recently hired to cover renewables utilities. She's gonna have a slightly closer focus on some of the pinch points that come with the transition and what that means for, for example, natural gas, as batteries become cheaper and can maybe function like a peaker plant. And she's going to look a little bit more on the East Coast, some issues with offshore wind development. I'll be a little bit more West Coast focused to the extent that we're dealing with issues related to heat, power supplies. California, I'll continue to look at California, because it's a great- it so encapsulates a lot of the challenges I think that we're going to see more broadly. And it's just very interesting in its own right, as it pursues these very ambitious decarbonisation goals. But I think that we're going to be keeping a very close eye on what happens with sort of the overall issue of developing more transmission to support the energy transition has historically been extraordinarily challenging in this country. And it's been a big topic of legislative debate. The Federal Energy Regulatory Commission is taking a close look at how you can see some of those roadblocks, but I don't know if we necessarily have a great set of answers at this point. And it'll be, of course, interesting to see what happens on the legislative side in the next however long and whether there's any incentive there to help with the build out or even just think differently about the use of the system to ease any sort of bottlenecks we have right now in transferring power around the country. Transmission is a big thing. I think batteries is a super interesting space to continue to watch. It's so critical.

Bret Kugelmass
And I was gonna ask, how much of this is tied into Build Back Better, the infrastructure moves in the future. Do you, as you look at these- obviously a public acknowledgement that we need to upgrade our infrastructure. I mean, even I think like five years ago, there was something like the civil engineers report gave us a D across all these- it's like, okay, we know that we've got to build more infrastructure. Now that you're so deep in it - and I mean, you're the first to talk about how complex these issues are - do you think we're heading in the right direction? Do you think we need to double, triple down on how we think about this? Do we need new technology? Or are things just gonna keep going for the next 10 years like the last 10 years? What's your kind of like, you know, real critical?

Katherine Blunt
Maybe guarded optimism? I don't know. I mean, I think that there's much more broader acknowledgement that much more needs to be done, objectively, to invest in the infrastructure. We have to think differently about it, because climate change is a real threat. There is a very challenging timeline that we're supposed to be working on across the board globally to reduce carbon emissions. And investments in our power grid and the way that we produce power the way that we consume power is going to be critical in achieving those goals. I mean, that's just objectively true. And so I think that there's a lot of recognition of that. But there's a lot of very thorny questions that come with cost. Who should bear those costs? And so, in terms of the Build Back Better, the legislative debate that's going on right now, you see those tensions. I have a colleague who covers federal policy, federal energy policy. I don't focus so squarely on that, but it is critical, because the companies in my universe are all going to be affected by this in terms of what they're required to do, what they're going to be incentivized to do. And then, of course, there's some of this that they're already doing, regardless of what happens at the federal level and policy standpoint. I don't know. I mean, I think that the the kind of infighting and the back and forth you see over this kind of stuff just shows how hard it's going to be to achieve what we're trying to achieve quickly. Not that it's not going to happen, but it might not happen on the timeline that's been set forth, certainly.

Bret Kugelmass
Can we switch gears for a second? I'd love to just learn about writing in general. I've tried my hand at a couple op-eds and so I'm like personally becoming a little more interested. Do you have a process? Do you have like a little notebook? Do you go to coffee shops with your laptop? How do you write?

Katherine Blunt
I mean, the nice thing about reporting and just writing daily stuff is, when you do it a lot, it becomes pretty easy. And then there's like, from a journalistic standpoint, you kind of know how to structure it. It's like, what's the most important thing you need to go at the top? What's all kind of the supporting information? We call it B matter, like the kind of secondary stuff that can come from previous articles, honestly, just to kind of give people the background that they need to understand the new thing you're putting forth. It's pretty simple. It doesn't usually take a huge amount of time. But it's when you're doing something that's more complex analysis or something in which the way that it's written kind of matters more. I mean, just my personal process, I have to write pretty early in the morning. That's when it's easiest for me. Some people I know are completely the opposite. They have to wait until it's like after 10 o'clock at night. The kids are in bed, no one's gonna interrupt me. I'm going to work until two o'clock in the morning. So I think that there's a real art to it. And I'm trying to describe how to like articulate what that looks like. But I can tell you that it's extraordinarily frustrating sometimes. You're like writing a sentence and you're like, I can see it in my head and this is not it.

Bret Kugelmass
How much back and forth is there with an editor, let's say for like an 800 word article, like 500 to 800 words? How many rewrites do you do before you send it to the editor, after the editor?

Katherine Blunt
For the most part, I would say if it's 500 to 800 words and it's just a daily, there's not a huge amount of back and forth, unless for whatever reason, my conceptualization of it wasn't- he didn't feel hit the hit the mark. And that happens sometimes. But I would say for the most part, that's pretty easy to execute quickly. There's not a huge amount of rewriting. But certainly when- I mean, in every big like longer story that I've done that has an element of very deep analysis, the journals process is very, very involved. It goes through a lot of different editors and depending on the subject matter, we might go through it word by word. It's like, where did this- is this word justified, basically.

Bret Kugelmass
You're talking about now when you get up to like the 5,000 features. That's when you get really serious.

Katherine Blunt
I mean, 2,000... 3,000.

Bret Kugelmass
2,000... 3,000. All right. Oh, okay. Yeah, so let me ask that as well. So what are the categories? I said, 500 to 800, just because that's what like a lot of the op-eds are.

Katherine Blunt
That's pretty standard for a daily story or a short-term enterprise story.

Bret Kugelmass
And then there's like a medium feature, which is like 3,000 and a large feature, which is like 5,000?

Katherine Blunt
5,000 is a very large feature.

Bret Kugelmass
So it's very rare that you do that much.

Katherine Blunt
You don't usually go quite that high, but it's not unprecedented. But oftentimes, I would say 2,000, maybe 2,500.

Bret Kugelmass
And how do you keep a reader's attention for that long? Are there tricks, like bring in a personal story or something? How do you keep someone reading?

Katherine Blunt
Usually, if you've got a long story, it's got a narrative element. I mean, that's the- I don't think that we usually go that long on a story that totally lacked a narrative and it's just presenting to you a set of really interesting facts that took us a long time to cover. That's a lot. That's- you're asking the reader to really sit with like a paper. So storytelling is the key and then you hope that- and what that requires is just a lot of very personal sourcing, requiring people to recall different recollections that actually help shed light on the broader issue that we're trying to do. And know if it's any sort of a contentious issue, that can be a challenge. A lot of people don't want to be associated or recall the various anecdotes that inform the circumstances.

Bret Kugelmass
When you're trying to navigate through different sources, I mean, can't- when you say like, Hey, I'm a reporter, but there's obviously going to be anonymity to it. Do they believe you? How much trust building-

Katherine Blunt
One way of approaching this is to say, We're gonna talk in background and that informs my understanding of the situation. Maybe we reach a point in which I've heard the same anecdote from people and it's all- they all agree that the details- corroborate the details of this meeting or whatever it might be in which this decision was made. And then you go back and say, I'm gonna report this, everyone sort of agrees with this chain of events and it's all according to people familiar with it. And then, at the Journal, if we ever do a familiar with the matter sort of situation, it's like you have to walk through privately and walk through the sourcing, to the extent to which everyone agreed, was there any sort of dispute. So source reporting has its own sort of internal process and it's something that you need to approach delicately with sources. And it's certainly not something you try to rely on overuse, right, because people can kind of raise eyebrows of those familiar with the matter instruction, which is funny, right? Because you'd never cite people unfamiliar with the matter. So trust that I figured this out for you. Sorry. I hope I answered the question.

Bret Kugelmass
Yeah, yeah, no, definitely. And then I wanted to ask a similar set of questions for the book writing process. How do you treat a book differently? When you go off to publish a book while you're still working for them, are they part of that process also? Is that like a side process? And what's that like?

Katherine Blunt
Yeah, so it is a side process. And I was very fortunate the journal gave its blessing to this project. That's the key, you can't kind of do it by yourself. So the book writing process, I mean, certainly, for me it was a learn as I went. I've not written a book, but I had a really good time doing it, because I really enjoyed digging very deeply into some of the- pretty much all of the different elements of our conversation so far. One of the most stimulating ideas for me in writing all this is just this very idea of corporate liability and what it means to hold a company of this nature - one of such consequence - accountable for the decisions have been made over time. And, of course, the issues related to climate and regulatory stuff are super interesting also. But at the end of the day, I was just really happy to have the space to try to explain this more fully.

Bret Kugelmass
Do you have like a mentor when you write it? If this is your first book, do you have someone who is your advisor on this process?

Katherine Blunt
No. Well, I'm fortunate that I have colleagues who have written books. And so I was certainly consulting on certain elements of the process with them, including my colleague, Russell Gold, who has written two. I don't have a formal advisor, but working with a thoughtful editor at the publishing- through my publisher, so that's been good. But it was certainly- I do recall, in the beginning, feeling like this was really challenging. And then the first few chapters took a really long time. But then I felt like I kind of got in the groove and the rest of it was easier to execute than that, even just in the beginning. And part of that was because the material in the beginning I wasn't as familiar with. But I certainly learned a lot through the process in terms of how best to research this and how to bring a story to life over the course of such a long- so many chapters, thinking of each chapter as a discrete story.

Bret Kugelmass
Yeah, I was gonna- I was wondering if- I've seen this in some cases where people who have like a beat will kind of test out the ideas or write as they go like by writing articles, and then they'll compile the articles to a book. I'm wondering if there's some element of that as well, where some of the daily articles that you've written helped formulate the nuggets for different chapters as you go.

Katherine Blunt
Absolutely. The work that I- that we produced on PG&E in 2019 really served as the foundation of the book and then the narrative that we- we published a long narrative at the end of 2019 that- we attempted to do what this book is attempting to do, just in a much shorter format. And it largely cues to that structure, so that was like a very good roadmap for how I was going to parcel it out into different chapters. And I, of course, added some, added a couple of chapters that we never really got into whatsoever in the narrative, naturally, but that was foundational.

Bret Kugelmass
How close to finished is it?

Katherine Blunt
Just turned in the manuscript a couple weeks ago. Going through edits currently. I think we're kind of buttoned up at Christmas and then it'll come out next summer.

Bret Kugelmass
That's awesome. Do you feel a sense of relief at this point? Or is there still a lot of hard work that's gonna come?

Katherine Blunt
Yeah, I thought it was gonna be, but hopefully by the holidays, maybe a little bit of relief.

Bret Kugelmass
Well, I'm gonna ask you the question a different way then. Do you have like- did you catch the bug now? Now that you kind of finished up at least your main thoughts, you got it out, okay, now you got some cleanup work to do. But are you kind of excited about what your next book is gonna be?

Katherine Blunt
Several people suggested a book about the Texas freeze and that's something-

Bret Kugelmass
That would be on theme with you.

Katherine Blunt
I would absolutely read another book, given the right opportunity. I just don't know what that would be just yet. And talking about having the work that I was so privileged to have done for the Journal as a foundation for this made the process exponentially easier than it would have been just starting cold on something, essentially. And I wouldn't have been starting cold on the Texas freeze, but that's- if the PG&E story is complicated, the Texas freeze story is like-

Bret Kugelmass
Yeah, probably a lot more to it.

Katherine Blunt
So we'll see. We'll see, but if you have any ideas, you know.

Bret Kugelmass
Yeah. The problem is ideas are a dime a dozen. The reporting is the hard part. Okay and then also I want to learn just a little bit about like you and when you discover- when you have like a new idea, what's that like? What's that experience like for you when you come to a conclusion in your writing? Is that like a jump up and down moment? Is it like you sit back with a quiet satisfaction? How do you- like your personal intellectual like being stimulated? How does that occur in writing?

Katherine Blunt
Oftentimes, it's something that- I love feeling very enthused by an idea and wanting to think about it hard enough that you can basically crystallize it in a way that demonstrates your deep understanding that puts it forward so that almost any reader comes into it and understands what it is that you're trying to convey. With really complex ideas, that's a really hard thing to do. And so to feel as if you've done it effectively at some point or thought about it enough to reach a really- a conclusion that is really useful and concise and simple enough to help everybody come to terms with something that they might not have thought much about themselves, that's really satisfying. It's a quiet satisfaction, but it's definitely really satisfying. And there were a couple of points like in the book that I'm hoping people will appreciate.

Bret Kugelmass
Amazing. Katherine Blunt, thank you so much for joining us today. This has been an awesome conversation.

Katherine Blunt
Thank you for having me.

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