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Well, thank you. 

I had planned to say how pleased I was to be back with the Western Governors’ Association.  (Laughter.)  But it really is good to be here.  And it’s good to have fun while we actually get some serious work done, and I appreciate that.  And thanks, of course, to our hosts here in Jackson Hole.

I’m going to try to make very brief comments to leave most of this for Q&A, because I think that would be more interesting.  So let me just highlight a few things that certainly have occurred since we last got together.  And I also will be coming back and acknowledging my colleague Secretary Jewell later on.

But clearly in the energy sphere, frankly, the biggest piece of news – it’s not news anymore – but the biggest piece of news was the Paris agreement, the COP21, with essentially every country in the world committing to decreasing carbon emissions.  Now, again, without getting into the issues of climate science, et cetera, I would argue that there is essentially an inevitability in terms of this direction, and all that it implies. And we all know that the kinds of change in the energy sector that this implies is both opportunity and challenge.  And we know that, and obviously in Western states you know that quite, quite well.

But let me emphasize that, in that context we remain committed very, very strongly to continuing to enable all of our energy sources to have a place in the low-carbon marketplace.  Certainly for coal, for example, we all know that means continuing extremely robust investments in carbon capture, carbon utilization and sequestration.  We appreciate, first of all, the Western Governors’ statement on this.  And secondly, I wanted to emphasize that we are putting a strong emphasis on what we call Innovation CCS, looking at novel approaches that may substantially reduce the cost, for example, associated with carbon capture.  And again, we can discuss those if you wish.  But I just want to emphasize that fossil fuel use, nuclear, along with renewables and efficiency, will all remain very prominent in our portfolio.

As a factoid, I think no one predicted the speed with which we have seen – largely driven by low natural gas prices – the substitution of natural gas for coal in the power sector.  But again, that is something that we will continue to try to manage together as we go to the lower-carbon future.  I would also add there’s a certain irony that the questions we get asked all the time is:  Are low natural gas prices going to, you know, drive out renewables?  Well, the facts are that low natural gas prices have actually hit hard is coal and nuclear, because that’s what’s also underpinning the closure of a number of nuclear power plants.

So, anyway, there’s no way around the fact that we are on the pathway to a significant transformation.  Our job is to turn this into opportunity across the entire country.  In that context I want to emphasize something else that was very important in the road to Paris, and I believe will be even more important in the road from Paris, and that is something that we call Mission Innovation.  That’s where the United States, along with 19 other countries, committed – and now, by the way, we’ve added the EU as a 21st entity – over a five-year period to double energy R&D.  The idea is to expand the innovation pipeline, create more opportunities for investors to come in. 

And, in parallel, Bill Gates led the formation of a coalition called the Breakthrough Energy Coalition, which is 28 investors, rather deep pockets, from 10 different countries who are poised to focus on taking advantage, if you like, of the increased innovation pipeline.  So this will be a big focus.

We’re talking here serious money.  The baseline to be doubled among the participating countries is just about $15 billion.  So this is going from 15 (billion dollars) to 30 (billion dollars) over a five-year period, and a lot more opportunities, again, to make this transformation one in which we can really, frankly, profit from as we make the transition.

So this is a big focus for us.  Governor Hickenlooper mentioned the rest of our term; certainly, in the rest of this term, we will be focusing on this very hard.  And it will have this, as I said, very, very broad investment footprint.

I mentioned coal; let me mention nuclear, another area where there are certainly challenges.  But we are moving forward in a number of ways.  And certainly, with our friends in Idaho, we are continuing to emphasize innovation in nuclear.  We are very interested in small modular reactors at our Idaho lab, in connection with our Utah friends, NuScale.  We may have, we hope, the first of those deployed early in the next decade.  And we are also looking at solutions to the back end of the fuel cycle.

Again, just to mention a few things to tee-up possible questions, our loan program, which has had a major footprint in the West – in California, Arizona, Nevada, Oregon – is still, I want to emphasize, open for business.  And we will be looking to deploy considerably more loan and loan guarantee authority to move forward big projects, including fossil fuel based projects that address emissions.

I’d like to mention another thing, which I think hopefully will be of strong interest in the Western states.  In the Senate, we achieved some language which we hope will eventually get through the entire Congress to use a small part of that loan authority for an Indian tribal lands and Alaska native villages loan program.  This would greatly amplify what we can do on tribal lands, perhaps deploying like $100 million of loan authority to get projects done.  So I think this is something, obviously, which could be of very, very strong interest here in the Western states.

Finally, on the energy side – or maybe not quite finally – let me mention that we have put a much stronger emphasis on energy integration with Canada and Mexico.  In fact, there’ll be a summit coming up in a few weeks that will be addressing some of the issues around particularly electricity integration across those two borders.  Again, a major issue.  And in fact, Governor Bullock and I discussed that, along with other things, coming forward.  But that will be something that is going to grow strongly with the new government in Canada, and we can expect along our borders to have a more activity there.

Mentioning infrastructure, we are continuing to work on and we will put out the second regional installment of the Quadrennial Energy Review.  Without going into detail, this will be an end-to-end consideration of the electricity system.  And I mean system.  It’s not specific technologies only.  It’s the system design.  It’s policy design.  And, for example, an area that is of tremendous interest in many of the Western states is how one values different services in the gird.  It’s a contentious issue, but one that’s very important.  And we will continue to be in dialogue with the Western Governors’ on that.  I would just note that earlier this year we exercised for the first time what’s called Section 12.22, a way in which the Department of Energy, in regions that have SWAPA or WAPA footprint, which the Department of Energy can become a partner in long-distance, high-voltage transmission to move clean energy around. 

I’ll mention that in legislation passed in December, and potentially further legislation, the emergency response authorities and obligations of the department are being expanded considerably, another thing of interest in these areas and in the West.  For example, just about a month ago there was a major exercise done looking at a scenario –– some of the issues that could arise if there were the really “big one,” so-called, a major offshore earthquake in the Northwest, which is considered to be a major risk.  But anyway, that’s another area where we are being asked to expand our footprint.

Finally, just two things on a different subject, our nuclear security responsibilities.  One I want to mention – and this is in partnership with Secretary Jewell and the Department of Interior and the National Park Service – we are moving to establish the Manhattan Project National Park in Washington, New Mexico and Tennessee.  And that’s an important project, certainly in those states, and I think for the country. 

And finally, something that has indirect consequences for many of the states is we remain on track to reopen WIPP, the underground repository for transuranic waste in New Mexico, this year, to start emplacing things. 

So those are the news bulletins.  And I’d like to just then open it up for Q&A.  Thank you.