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Disclosure: Nexus Labs Syndicate is an investor in WattCarbon.
“They're doing the same thing they did last year, but now it's called decarbonization. But the reality is, is that they are decarbonizing buildings. The work that we've been doing for 20 years is the right work to be doing we just don't have a metric to measure ourselves against and a way to value that work."
—McGee Young
Welcome to Nexus, a newsletter and podcast for smart people applying smart building technology—hosted by James Dice. If you’re new to Nexus, you might want to start here.
The Nexus podcast (Apple | Spotify | YouTube | Other apps) is our chance to explore and learn with the brightest in our industry—together. The project is directly funded by listeners like you who have joined the Nexus Pro membership community.
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A quick community announcement before we dive in: Now that Cohort 5 of our Foundations course is launched, I want to make sure everyone knows that we also do private cohorts. All of you do onboarding when you hire new people… think of this as industry onboarding. We host teams of 10 or more and teach the smart buildings industry to them in a private setting. Hit us up to get on our schedule.
Episode 120 is a conversation with McGee Young, founder and CEO of WattCarbon.
We outline one of the most important journeys I think our industry needs to go on: The transition from energy management to carbon reduction, from lowest-cost carbon accounting to highest impact carbon accounting, and from any renewables are good to valuing renewables based on location and time of production.
Underpinning all of that is the need for a data platform to help calculate, understand, and value carbon and unite energy consumed in buildings or produced by DERs with the carbon-intensity of the grid at that location and time. That’s what WattCarbon is building.
Without further ado, please enjoy the Nexus podcast with McGee Young
A message from our partner, Montgomery Technologies:
Cybersecurity, change management, remote access, and data integrity across 8-10 siloed systems per building presents a significant challenge for CRE operations. Just knowing where everything is, how it is connected, and where it is connected can be too much for thinly-staffed corporate IT departments, whose primary function is to oversee the corporate network.
🎥 Watch this quick explainer video to learn how a converged network fills this gap, solves for all the above, and is the first step to enabling a Smart Building.
You can find McGee on LinkedIn.
Enjoy!
A message from our partner, enVerid Systems:
Improving indoor air quality (IAQ) with optimized ventilation and air cleaning need not conflict with building decarbonization and climate resilience goals.
Read enVerid's new white paper, How to Achieve Sustainable Indoor Air Quality, to learn how a four-step Clean First approach can be used to design and operate low-energy, high-IAQ, climate resilient buildings of the future.
👋 That's all for this week. See you next Thursday!
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Music credit: Dream Big by Audiobinger—licensed under an Attribution-NonCommercial-ShareAlike License.
Note: transcript was created using an imperfect machine learning tool and lightly edited by a human (so you can get the gist). Please forgive errors!
[00:00:33] James Dice: Our first sponsor on the show had to be Montgomery technologies. Their COO Joe grasper, Doni is easily. The number one fan of the show. No offense, of course, to any of you, other hardcore listeners out there, but Joe listens to every episode sometimes more than once. And then he gives me his feedback via email. Good, bad, or otherwise.
Joe as a podcast host dream. And I think you've made me a much better interviewer. Jonas team liked to remind all of you of [00:01:00] the importance of the network layer and the smart building stack. Technology installed in buildings placed a heavy burden on commercial real estate operations teams.
Cybersecurity change management road, access data. Integrity across all the different siloed systems in the building presents a significant challenge, just knowing where everything is, how it is connected, where it is connected can be too much for thinly staffed, corporate it departments. Their primary function is to oversee the corporate network, not all of these systems in the network.
So learn how a converged network fills this gap. By clicking the link in the show notes, it shows how a converged network solves for all of the above and is the first step to enabling a smarter building.
This episode is a conversation with McGee young founder and CEO of wok carbon. We outline one of the most important journeys. I think our industry needs to go on this transition from energy management to carbon reduction from lowest cost carbon accounting to highest impact carbon accounting. And from renewables are good to value renewables based on [00:02:00] location and time of production.
Underpinning all of that is the need for a data platform to help calculate, understand, and value carbon and unite the energy consumed in buildings or produced by. Distributed energy resources with the carbon intensity of the cred at that location in time. And that's what wall carbon is building. Equip community announcement. Before we dive in, now that cohort five of our foundations courses launched. I want to make sure everyone knows that we also do private cohorts.
So all of you in the industry do onboarding when you hire new people, think of our foundation's course as industry onboarding. We host teams of 10 or more and teach the smart buildings industry to them in a private setting for your context. So hit us up to get on our schedule without further ado. Please enjoy the nexus podcast with Mickey
[00:02:47] James Dice: Hey McGee, welcome to the show. Can you
[00:02:50] McGee Young: introduce yourself? Uh, thanks James. Uh, hi everybody. I'm McGee Young. I'm the founder and CEO of Wat Carbon. Yeah,
[00:02:58] James Dice: I'd love to hear more about [00:03:00] your background. Can you, can you go a little bit deeper? What'd you study in school? And then take us through from there all the
[00:03:07] McGee Young: way to today,
Yeah, sure. Um, I was a, I was actually a political scientist as a, as an undergraduate, as a graduate student. I got a PhD in political science and then I taught for 10 years at Marquette University in their political science department where they gave me tenure. And, um, a few months later I walked into my president's office and said, I'd like to retire, please.
And they looked at me like I was crazy. They said, I don't think you're old enough for that. Um, so, well, I think I quit and um, and then I left and came out here to do startups. Amazing,
[00:03:46] James Dice: amazing. You have to explain this epiphany to me. So how long had you been studying for, and then how long did it take you to decide to quit and why'd you quit?
[00:03:56] McGee Young: Well, it was, yeah, I, I graduated from, from undergrad, you [00:04:00] know, not knowing really what I wanted to do. So, of course, you know, grad school seemed like a reasonable place to, you know, camp out for a while. Got it. Okay. And then, You, you kind of get wrapped up in it and you know, they're like, Well, you know, you're gonna get your PhD right?
And they're like, I guess so. And it's like, well, you gotta go get a job now, right? Yeah. And then you gotta get, write a book and get tenure and you just sort of get on that treadmill. And, but Marquette was, uh, was a great place to be at. And, and one of the things I got involved with there was, uh, setting up a social entrepreneurship program.
Mm. Okay. And, um, I started to incorporate that into my classes. I actually started two companies while I was a professor and, you know, so I was, um, you know, way more interested in doing that part of my job than doing the like actual, you know, professor part of my job. And so once I had kind of gotten through the milestone of getting tenure, there was nothing really left to kind of prove.
Academically mm-hmm. . And so I felt like [00:05:00] it just made sense to go do the thing that I was really excited about doing. And so I had a, an unprofitable software startup and I thought it makes total sense for me to relocate my family to the Bay Area to try to pursue this in a place twice as expensive. And, and of course that didn't work.
Um, but, um, I ended up, uh, getting a job out here as the first employee of a company called Open Energy Efficiency, and, uh, which later became known as recur. And, um, and so I spent five years as the CTO at recurve building measurement and verification software for utilities to measure their demand side energy programs.
And so that was really my, you know, indoctrination into the, into the depths of, of, you know, energy modeling and, and, and the energy industry, um, in general.
[00:05:47] James Dice: okay. So how'd you go from political science
[00:05:51] McGee Young: professor to
[00:05:53] James Dice: cto? Explain to me how the educational process works to, to make that transition happen.[00:06:00]
[00:06:00] McGee Young: So the, so the, my, my kids make fun of me cuz like, as a political scientist, you really don't have any skills, right? I like, you know, I joke that I'm a doctor and, and it's like that, you know, it gets more laughs but, um, you know, for the world of energy, um, you know, I had, so I had started to, to learn software and to build, you know, software products, um, as in my first couple of companies.
So there I have, you know, sort of a passing familiarity with some of those principles, but really in the world of, of energy and, and, you know, m and v. The bulk of the technical work is actually in the modeling. And a lot of the work that we're doing and at Recurve was, you know, kind of regression based, modeling the same types of methods that frankly we used in political science to study elections and, and that I see.
So, um, it wasn't actually, it was a different, a lot of different acronyms, . Um, but, but that was also kind of like, you know, as it, it, as you get into, you know, the world of academia, you have to [00:07:00] learn a lot of different, you know, kinds of esoteric concepts. And so energy sort of fits quite nicely and with, oddly enough, political science and half of the work, you know, that we do is policy work.
Uh, Right. So having a deep appreciation for how policy gets made and, you know, understanding, you know, federalism and, and those, um, you know, institutional kinds of, um, Or, you know, ways in which decisions get made and, and executed on and some of the like limits that we have, uh, to being able to do things, uh, really like kind of paid off, um, in a lot of ways, you know, definitely at Recurve and, and, and certainly the work I'm doing now.
Totally.
[00:07:43] James Dice: So we had about a year and a half ago had, um, Matt Golden on the podcast. So can you talk a little bit about, maybe review for people, kind of the work you did at, at recur and sort of give us a sort of, you know, 32nd overview of [00:08:00] Cal Track and the things that you guys developed there that were
[00:08:02] McGee Young: novel?
Yeah. In the world of energy efficiency, m and v, the challenge that, that that industry has faced is that you put a hundred engineers in a room and ask them to measure the savings of a. And you get a hundred different answers. Mm-hmm. . And the problem is that they're all right. And so when you try to build, you know, um, so if you wanted to build markets around energy savings, you know, it, it ends up looking like the ESCO industry with, you know, 200 page legal documents, you know, describing how exactly you're going to get out of the obligations that you've put yourself into in the first place with the contract.
And, and so this was really a, you know, Matt saw this, you know, quite acutely, um, that this presented a real barrier to being able to scale energy efficiency, you know, markets in, in particular, um, especially as we start to transition into the, these newer kind of forms of virtual power plants and flexibility markets, um, integrating demand response and energy efficiency.
And so we had to really kind of like [00:09:00] figure out how would you, if you were to standardize, you know, a measurement in verification calculation, and if you were to use hourly energy data so that you could really dial in. The particular value for energy savings at particular times a day. How could you develop a framework in which that measurement and verification could be more or less universal?
Right? So that any organization that was delivering demand side energy savings could presumably participate in a market that was set up to do that. And it took us, you know, five years of, of, you know, like kind of in, in stages, right? We did CalTRACK 1.0, which established methods for using meter data for, you know, daily and monthly, you know, uh, granularity of, of data.
Then CalTRACK 2.0, which really honed in on the hourly methodology. Mm-hmm. . And then, you know, we kind of didn't really call it Cal Track 3.0, but the, the last kind of big [00:10:00] lift was post covid. How do you. Create comparison groups that would allow you to, uh, account for major disruptions. Like the world shuts down and everybody's energy use is a lot different.
Um, how does my, how I can't really do like a pre-post anymore. I have to do more of a broader comparative, um, methodology. So how do you go find doppelganger buildings to the ones that you're looking at so that you can, um, kind of account for those out, those external conditions as you're doing your mnv.
So all of those became, you know, kind of core to thinking about, Okay, so what if you took that, you know, kind of universality of meter based measurement verification and weren't just thinking about it in terms of like energy markets or, you know, demand side energy programs, but really like building decarbonization in a broader sense.
And could we actually, you know, since we're now generating revenue grade meter [00:11:00] metered savings, Uh, for energy programs, could we come with a, come up with a way to do the same thing for buildings for decarbonization that would allow us to invest in be decarbonization, um, broadly in buildings, right? Not just as a response to an energy price signal, but to the, the degree to which their responsible for carbon emissions.
This is 35% of our carbon emissions, you know, on an annual basis is coming from our buildings. And so unlocking them as trying to kind of assets right. That like help us get to our net zero goals felt like a really awesome opportunity to go after. Mm-hmm. . Yeah. Yeah. And I'm
[00:11:39] James Dice: sure
[00:11:39] McGee Young: as, as you and I have talked about in the past, you learned a lot about how, you know, the traditional
[00:11:45] James Dice: methods of measuring and calculating energy savings are, are a bit flawed.
Um, Which we've discussed in this podcast that we won't fully get into. Uh, but I can only imagine you coming in from political science and even if you [00:12:00] understood regression and understood how it's done on that side, still coming in and like viewing it and going, Oh,
[00:12:08] McGee Young: you know, what's
[00:12:09] James Dice: ip mvp? What's this astray Standard 14?
And all of that is a deep, deep rabbit hole. Um, but you got bit by the book, it sounds
[00:12:19] McGee Young: like . Yeah. I mean, here's the thing is like, I think, I think there's a lot of people have really tried hard to think about how to measure energy savings, right? There's, there's sort of this sort of like bad rap, you know, that like, well all these people do it differently, but it's not because they're acting in bad faith.
Uh, it's because these are hard problems. There's no right answer, right? There's the counterfactual is. Just, you know, a sort of a hypothetical of like what would've happened and there's a lot of different, you know, considerations that you might, you know, bring to the table. And, and, [00:13:00] and as you look at a lot of different ways that, you know, a lot of different methodologies, you know, evaluation methodologies that are used, um, you know, every, it's really easy to pick apart flaws in a particular, you know, study or a particular approach.
And some of the flaws are, are kind of, um, you know, you can point to specific methodological choices. Others are the time lag that you get between, you know, when a, when a project happens and when we get around to evaluating it. But I think as a profession there's been, you know, just a lot of really good, thoughtful work, uh, that's gone in.
And as we approach this question of measuring carbon emissions from building. Um, meter data is actually not always the best way to do this. Um, you know, when we look at, for example, putting in a heat pump versus, you know, another natural gas furnace, you may not actually wanna use whole building meter data to assess the impact of the heat pump vis Avi, the gas furnace.
Um, and so some of, [00:14:00] some of the IPM VP family, you know, option B, option D, uh, might actually be, uh, a better way of assessing the particular impacts of a particular type of, or if you think about like plugging in your car, right? Is whole building meter data really the best way to, you know, tease out the carbon impacts of an electric vehicle?
Maybe not, right? And so I think we shouldn't be biased or have blinders on about like, there's only one right way to do things actually. Really appreciating the nuance and, and all of the different kinds of contributions to this work that the industry has, um, you know, developed so far. Give us the resources that we need today to actually be, um, really thoughtful about calculating the decarbonization impacts of different kinds of projects.
Totally. That was very diplomatic. Thank
[00:14:50] James Dice: you . Um, so, okay, so you were at recur. Um, can you talk about the, like why'd you jump ship [00:15:00] to go to, to start wat Carbon? Um, what's the problem you sort of set out to solve?
[00:15:05] McGee Young: Yeah, so once I, um, you know, we had, we had gotten, you know, Recurve is doing great by the way, and, and you know, it's a, it's a company that's, you know, solving some really important problems on the, you know, four utilities who are trying to deploy demand side energy programs in a scalable way.
Um, and once I left and you know, I was kind of, had time on my hands to, to, to think about things. One of the. I kept getting, you know, riled up about, I would read these stories about California's cap and trade system. Yeah. Where we've kind of established this like license to pollute for the big, for the utilities and the oil companies and, you know, the big industries in California and that, you know, cap kind of comes down every year and if you exceed the cap, you have to go buy offsets in the carbon market.
Mm-hmm. , which turn out to be, you know, trees and a forest somewhere [00:16:00] for the most part. And, uh, ProPublica did this really interesting, uh, study of what were being purchased for offsets and how they were being calculated. And it turned. That this is like, kind of like the funny part is that they're mostly using deemed savings to measure the carbon impact from the office that were purchased.
So they would, they would divide up California into climate zones and they say if your trees are in this climate zone, you get this amount of credit for it. Okay. Just like a deemed savings program for a utility program. And that we had been fighting against. I was like, so what ProPublica realized is that all of the carbon assets were coming at the very edge of the climate zone were the least amount of trees were for that particular, you know, for that, you know, that zone.
And so they were gaming the system. And, and, and then can
[00:16:53] James Dice: you explain real quick what deemed
[00:16:55] McGee Young: savings was? Oh, uh, yeah. So deemed savings, uh, [00:17:00] are typical of a utility program where you install, say like, Thermostat or some lights. And they don't bother measuring the, of those savings. They just give it a number and they say, Well, all thermostats are worth X amount.
Yeah. You know, this isn't true. Right. And so it leads people to game the system to, you know, do the least amount of work possible to get the biggest benefit, which is, you know, kind of human nature. And so the same thing is happening with trees that we were. You know, kind of claiming these carbon offsets in these very narrow SLIs of the, the zone where there like literally weren't any trees in some cases.
And then in other places they were burning down in forest fires. And so we had said, Well, for the next hundred years we won't cut down these trees. And so that justifies the emissions from last year. Mm-hmm. take one year's worth of emissions and spreading them out over the next a hundred years. And then we were burning down and then the trees were burning down, burning down.
[00:18:00] We still had the emissions and so we didn't have to go buy a new set of trees. Uh, we just said like, Oh, well I guess that didn't work. And, and I, and I was like, . And, and, and then, so I simultaneously, I had this thought where like, well, I had been doing this work on my house and I had put in solar panels, a heat pump, a battery.
I had my ev and I wondered to myself, How am I doing? You know, like I, I think that my carbon emissions are probably pretty good. Um, but how would I know if that were the case or not? And I started to dig into that and it turned out to be like, not an easy question to answer. So what do you use to answer that?
Um, the, for our energy efficiency calculations, uh, the avoided cost calculator, there's a G HG benefit as part of the avoided cost. And it's kind of the same, pretty much, you know, it's, it's a single number that you add, that you multiply by. And so like [00:19:00] no matter if I was saving energy in the middle of the day or at night, I got the same GQ benefit, right?
That seemed, that seemed wrong. Right? Using kind of typical, uh, g HG accounting methodologies, I would take my annual energy consumption and multiply it by the carbon emissions of my grid on an annual basis. Uh, well that seemed wrong. And, and I have solar panels that feed back. So do I count my net metered energy and, and plus if I'm using zero energy during the middle of the day and, and all of my energy at night when my car is charging, uh, does it matter that it's what time of day it is?
Nobody could really answer any of these questions. And so it, like we started putting the pieces of the puzzle together, right? Like, like there's actually, you can get the hourly carbon intensity of the grid in California. Um, which by the way is another, you know, kind of like, Oh wait, I can't go to my [00:20:00] pg e bill for this, Right?
CE doesn't tell me, you know what my emissions are. They tell me I'm a hundred percent clean energy cuz I signed up for the deep green. Mm-hmm. , It turns out that's a lie. Also, uh, they just buy wrecks, uh, from solar and wind farms. They don't actually match it up to my actual consumption. Uh, so. I'm not really a hundred percent clean in any like, true sense of that word, only on an annual basis.
So as we started looking at this at an hour by hour basis, so I realized that my own carbon emission footprint was double what it really should have been because, you know, from an annual basis I look pretty good, but I'm charging my car at night and my solar panels, when they feed back into the grid, are feeding back into an already pretty clean grid.
Got it. So how should I even think about my own emissions, much less how to reduce them and, and then when I reduce them, I thought, Oh my gosh, it's gonna cost me almost $2,000 per ton of [00:21:00] carbon that I saved by shifting my electricity use from nighttime when it's cheap to daytime when it's clean. That seems really backwards, you know, first of all, and and highly inefficient, right?
Could there be a better way for us to reduce carbon emissions by tackling like the low hanging fruit? And so that became kind of our thinking at, while carbon is like, first of all, I need better information to be able to actually make decisions about my carbon emissions. I need to know how to make these decision decisions, how to calculate my carbon emissions.
And then what should I do? What's the, you know, what are the best possible ways to reduce my emissions without spending ridiculous amounts of money to make very, you know, little progress? And so I think that became kind of like the, the formative thinking behind the company. Got it. Got,
[00:21:51] James Dice: yeah. I really, a year ago when you launched, you wrote this like, here's what we're out, out to do.
The way you [00:22:00] phrase it then was, the measurement of carbon and carbon savings is gonna be critical to our future. Um, and it got me thinking back then, and then, you know, it's been fun working with you as an advisor. Recently, but we're, we're in these, like the middle of these transitions, I feel like, in the industry.
And the way that you phrase it back then was, we're transitioning from energy management to carbon. So my entire career has been energy management, right? And there's a new paradigm that we're shifting towards with carbon. Um, there's a paradigm that I'm just like starting to understand, which is low cost accounting to high impact accounting, which is what you said in the post back then.
Um, which I wanna unpack and then this, this also transition. Third one, which you talked about just now with the Rex, is that the value of renewable energy is location and time dependent. So we can't just, you know, throw solar panels where they're [00:23:00] not necessarily needed. Um, so how much of that transition, like where do you think we're at in those three transitions?
Um, Are we just starting them or are we, you know, further towards the end of that, those transitions happening
[00:23:18] McGee Young: as, as far as, I hope that we're just starting them. Mm-hmm. , I think so too, because if, if, if this is, if we're getting towards the end, um, the future's pretty bleak, , so we've got a long way to go, I think on, on all three fronts.
Um, I would say that there's a lot of great progress being made, uh, that there's really, you know, a lot of, I'm borrowing my thinking from lots of others who have been developing these concepts and, and certainly we're not necessarily breaking, you know, new ground necessarily as, as much as, you know, trying to pull different pieces together from different, you know, mm-hmm.
parts of the industry that maybe haven't, The demand side and the supply side are a good [00:24:00] example of, you know, To, you know, intertwined parts of the energy space that don't ever really talk to each other all that much. Totally. We think about a dpp, um, you know, that's, it's hard for supply side energy folks to like even take that seriously.
Even as much as demand response has proven pivotal timing again, as it's, you know, under for 22, 22, it's considered a resource just like any other supply side resource. But there's still this kind of like, um, you know, bifurcation of thinking and approaches in the industry. In in emissions accounting.
It's similar. Um, you mentioned, you know, scope two emissions, which are the indirect emissions associated with the electricity you're using from the grid. Those are largely, um, you know, off, they're not, they're not considered offsets, but as a corporation that's trying to reduce its scope to emissions will almost entirely buy renewable energy certificates.
Rex, [00:25:00] uh, to lower, its, um, its scope to emissions, you know, exposure, but the accounting for that is more or less done independently of the carbon emissions associated with the grid that those Rex come from. So if I'm offsetting energy consumption that's happening, say in Colorado where you're at, that's a relatively dirty grid with wind Rex from Texas or solar res from California, uh, we're not really getting, you know, the same bang for our carbon buck as we might be imagining.
Um, also the time of day, right? So if I offset a hundred percent of my energy use, Entirely with solar wrecks. Um, all of my nighttime energy use that's coming from gas and coal, you know, base load isn't really being accounted for with that renewable energy purchase. So my carbon emissions are not actually zeroing out.
I think there's some really good work that's being done on the 24 7 carbon free energy front right now that's trying to address that, but so much. But that is [00:26:00] turned out to be pretty complicated, Right, To being able to procure the exact amount you need at every hour of the day. Then what do you do with those, with the solar in the middle of the day that nobody needs?
Does it go mm-hmm. procured. Exactly. You don't really shut your solar panels off, maybe batteries a little bit. So there's a lot of rethinking that has to get done, I think still. Um, yeah, as the intersection of the supply and demand. As we think about what does our renewable energy future look like?
Totally.
[00:26:27] James Dice: Let's talk about what you guys have built so far. So like you're like a year into this journey. One of the things I think is really cool about what you're doing is connecting that demand and supply side, like you said, which is connecting real time carbon emissions data from the grid to hourly energy data that the building is consuming.
Um,
[00:26:47] McGee Young: so can
[00:26:47] James Dice: you talk a little bit more about what you guys have dug into there and some of the interesting
[00:26:52] McGee Young: pieces of that? Yeah. You know, our experience on the, you know, measurement and verification side, you know, [00:27:00] suggested. Access to data is one of the main barriers. Uh, for any, you know, any company that's trying to wrap their heads around this, um, meter data is still too hard to get, you know, mission data and Michael Murray are doing great work to try to open up.
Uh, we, but I think I read somewhere as 98%. Uh, Michael just had a big, uh, a big release about, you know, still today it's way too hard to get hourly smart meter data out of most utilities that are already collecting it. Um, so we actually went in a little bit of a different direction, uh, where we started to build on the work that NRE is doing again, in your backyard there.
Um, some of our first work, uh, was, um, involved modeling. Solar and wind production where you, you weren't quite sure, you know, this was sort of future projects that were, you know, going to be developed. And we're trying to get a sense of the, you know, what, what the production profile would, what those would be or res that you were buying that didn't [00:28:00] have an hourly timestamp.
And you're trying to get a sense of like, well, my solar rec's coming from here in California. When is it producing? And can I kind of back myself into a rough calculation of when that, you know, when I, when I should be us, you know, how I should be attributing those wrecks to particular hours of the day.
And then in Rail released an in use load shape database, um, last fall that, um, provided calibrated load shapes for all sorts of buildings across the US commercial and residential. Uh, it's a huge file, It's like 16 terabytes. And, um, and so we, we kind of worked our way through that so that in a, you know, through the platform that we built, Any building anywhere in the United States could, we, could, we could calculate the, roughly the hourly energy, the hourly load profile for that building, and associate it with the hourly carbon emissions from the grid that it was connected to, to give [00:29:00] hourly carbon emissions, um, for any building in the US on demand, um, through the app, which was sort of like, you know, that was game changing for us, right?
Because that, that was like, Okay, we can do this. Then we built our connectors to real utility data, so like utility api. Um, so now we could provide this sort of like real time accounting, as it were, of carbon emissions from, from any building in the United States. And I think that was like the moment where we're like, Okay, we have something here.
This is really cool now. Mm-hmm. , what can we do with this ?
[00:29:31] James Dice: Yeah. Real quick, before you talk about that, can you talk about how most people get their emissions today? So if I'm. Um, x, y, Z building portfolio, and I have, I've added up on my annual kilowatt hours and terms for all my buildings, and now I need to take that and get to emissions.
Um, how do they most
[00:29:55] McGee Young: people do that today? It turns out that even that, like [00:30:00] annual accounting that you're talking about, there is aspirational for a lot of companies. Mm-hmm. . And so not even getting that. Um, but let's say you have an annual total kilowatt hour consumption and you're trying to calculate your scope to emissions, uh, you would go look at the EPA website.
Um, they've got a, a, a data file that's called ERI and E grid. Uh, we'll tell you, you know, here's, here's the annual emissions factor for this, You know, for this grid that you, that you're, you know, you're building is, is, um, drawing its synergy from. And so you would multiply that annual number by your annual consumption number, uh, which is mostly fine if you're in a place like Seattle that's got a hundred percent hydro.
And so, or a place like Kentucky , that's a hundred percent, uh, coal. But if you live in California where the carbon emissions intensity of the grid's gonna fluctuate quite a bit over the course of a day. Uh, when you're [00:31:00] using your electricity during the course of the day, really can impact your carbon, you know, footprint as it were in a pretty significant way.
There's been some research to suggest that even upwards of a 30% difference, uh, for an annual average versus hourly. And so the, the companies that are doing this now are kind of stuck in this like, not very helpful annual kind of construct, but the, the getting from that to hourly is like a bit of a leap.
Mm-hmm. , So there's like this, you know, kind of like bifurcation now between are you doing it the annual average way or are you doing it in a more kind of authentic way? Yeah. I was just at a
[00:31:37] James Dice: conference last week where a software company was
[00:31:39] McGee Young: sort of ragging
[00:31:41] James Dice: about the development they've done where they've, you know, added on all their dashboards and all their metrics.
They now have carbon metrics, and I was just thinking like, hmm. Wonder how that's being calculated? But one of the things that kind of turned the light bulb on for me is, My water heater project, which I think people, listener for the [00:32:00] podcast will have heard a lot about. Um, the short answer about my project is that it's not done yet, and it's because I, you know, kind of used your guys' tool when you released it and realized how dirty my grid is locally and realized that, hey, like it's actually in the near term not really that helpful for me to, you know, convert my water heater from natural gas to electric.
I don't need to rush this. I can probably just run to fail. And in the meantime, this is a decision that I made. In the meantime, the technology, the heat pump technologies improving that actually just came out with a um, hundred 20 volt, uh, ream hot water heater. So like I'm, I'm kind of watching the space progress as I kind of weight out my project and I'm just basically told my wife, Hey, it's actually not great emissions wise for us to do this right now.
It's, it's helpful a little bit, but not it's, it's not really that high of an impact. I'm gonna let the water heater run to fail and as long as it doesn't [00:33:00] leak when it fails, uh, my wife's okay with us not having hot water for a few days, but yeah, I use your guys' tool to say okay. It just gave me some insight into, Okay, what's gonna happen when I switched this load from gas to electric?
Yeah, that was super helpful.
[00:33:15] McGee Young: Um, and you might, you know, consider putting solar panels Yeah. Them already, because the Colorado grid is still so coal reliant. Yeah. That would be an investment there that would have a, a massive carbon impact versus, you know, my solar panels are basically like, You know, not, they're great, especially when the, the power goes out and, you know, we need, but like from a climate standpoint, like I might have been better off putting my money someplace else.
Yeah. To really, um, make, make it if I, if that's where I wanted to, to, to sort of prioritize was. Um, and then, you know, just to kind of pick up on that point just a little bit, it's not, some, some listeners might say, Oh, this is terrible. All heat, hot heat pumps are good heat pumps. And, and, [00:34:00] but the thing is, is like we, every single day in the United States, 20,000 heat pump water heater are, are gas fired water heaters and gas powered powered furnaces fail 20,000 a day.
And almost all of them are replaced with more gas powered. Versions of that. And so that's the problem to be solved, right? Because they're gonna lock in 20, 20 more years of CO2 emissions if they're replaced with, And so I think our thinking on this is like, let's go make sure that as these units are failing, they're being upgraded.
At that point with the electric, even if the grid's still dirty, kind of where they are, we can kind of forecast out, you know, especially because of the IRA work, we're gonna get a lot more renewables on the grid. It's an appreciating asset in that sense. And so we definitely need to be swapping them out for the electric versions today if they're at failure point.
Yeah, I think that's one of the most important
[00:34:58] James Dice: concepts in [00:35:00] decarbonization right now is committed emissions. Like what is gonna happen from the, the replacement decisions that we make tomorrow.
[00:35:07] McGee Young: You know what I mean? Yep. Um,
[00:35:10] James Dice: okay. Another piece that I, I think is cool about what you guys have been doing is the, um, Kind of, and you're gonna have to describe this a little bit more, but can you go deeper into how you get to Scope two emissions from a kilo one hour used at a certain hour in a building?
Cause I think this is really important for sort of unpacking what we're about to impact next, which is Rex and Offset and kind of where we go from here. Can you talk about kind of the, the technical work that you guys have done there?
[00:35:43] McGee Young: Yeah, so it's, um, it's both, you know, deceptively hard and deceptively simple at the same time to do Scope two, which is, you know, partly why everybody, here's the tricky thing with Scope too, is.
There's two different types of Scope two emissions. There's your [00:36:00] Scope two locational and Scope two market. So Scope two locational should simply be your energy use multiplied by the carbon intensity of the grid that you're connected to. Um, and so again, we talked about that on an annual basis versus an hourly basis.
Um, and then scope to market, uh, takes into account the contracted energy use energy that you've, um, that you, that you've, or the energy that you've contracted for. So if I buy a wreck or I've, um, committed to a ppa, or even if I opt for a green energy tariff, uh, within my utility, I can report that contracted, um, electricity as a, I can subtract it from my total electricity that I consume.
So that my scope two emissions only reflect the difference between my total consumption and what I've contracted [00:37:00] for from mm-hmm. these from these other instruments. Uh, it's confusing. Uh, when you, you look at, you know, I'm not really taking into account the time of day or the location necessarily of what those contracted instruments, right?
Mm-hmm. , so I'm buying a hundred percent solar. Um, I'm not really actually offsetting all of my electricity consumption and, and you know, and so it doesn't really take into account the actual carbonate. It's, again, some of this stuff represents like a good faith effort at the time in which these protocols were drafted, given the state of our technology, of our data infrastructure, we just didn't have the capability.
Mm-hmm. , now we're here in, you know, 2022. And I know that actually the WRI is actually starting to update its scope two, they've just hired somebody to update the Scope two emissions protocols. So this is work in progress, but, um, some of the, uh, [00:38:00] incongruencies in the reporting are a function of, um, just technology's getting better and our, our protocols are like, kind of like circuit 2010, you know, kinda, Yeah.
So, um, so what, what's interesting about this is that, um, if you start to think about this from an hourly standpoint, then you can optimize for carbon. And, and so if I, you know, right now the guidance in the scope to emissions to say you should try to procure your energy from the area in which you know, you're using your energy.
And that way it kind of like roughly nets to the grid that you're, you're part of. But maybe I wanna procure. Rex from, you know, Kentucky. And so, and I live here in California, so like if I bought Rex from Kentucky, that certainly solar power is gonna displace dirtier energy in Kentucky than it is in California.
And we can kind of keep track of this stuff on a vocational and an hourly basis. In the word, in the protocol terms, this is the [00:39:00] residual grid. What are you, what's already out there on the grid that you're, that you're interacting with? Um, same way that you might think about demand response as another way in which you could specifically target dirty times of the day contract.
Mm-hmm. contract for demand response, you know, during the OR or, Yeah. Or the clean fronts of the day. Right. So you use more energy when the grid is clean. Don't use as much energy when the grid is dirty. What if you created a wreck around that right around demand response. And so you were really targeting your purchase, as it were, of, of energy to coincide with reducing energy loads when the grid was dirty and increasing them when, when it's clean.
So I think there's a really interesting kind of story here around carbon accounting that as we have better data systems in place, um, and we're being more thoughtful about, you know, identifying particular times in which, you know, we might impact the grid one way or the other, um, that, uh, we could be more targeted and thoughtful in our approach.
[00:40:00] Totally love it. Um,
[00:40:03] James Dice: the third piece that I wanted to highlight about kind of what you guys have built in the last year is the data platform and sort of API strategy. So can you talk about sort of the data infrastructure here in a way that's kind of all we've been talking about so far, Right? Um, Can you talk about some of the use cases you're solving for today for some of these early customers and kind of where that could
[00:40:27] McGee Young: go in the future?
Yeah. We, you know, part of the, the work of doing a lot of this data, we call it data, data lunging. Uh, we have, you know, different data sources coming in. They're, they all have sort of problems with, you know, by themselves, right? Time zones are wonky or you're missing data, or you have outliers and. Every time you add a new data source into the mix, you have to sort of go through that whole process again of like [00:41:00] cleaning and then matching it up the right way to the other data that you're trying to get.
And, and in the world of buildings and energy, you know, you have sites that have multiple meters on them that might be sub metered. And so you're trying to, you know, create your hierarchy of, of relationships and then maybe single out, how much is my HVAC driving my carbon emissions, you know, from building or I've got a bunch of buildings in different places.
I'm trying to like put them all in together in a portfolio and this one's on this grid and this one's on that grid. And, and it just really quickly becomes a hot mess. But then throw up, throw on the Rex that I've purchased and, you know, other, like it's, it was really obvious early on that companies that have struggled even just to figure out.
Their energy bills , like there's this whole, you know, the preexisting condition here is like, we're having a hard time just managing our energy spend. And I'm gonna throw on this complexity of carbon accounting on top of it. Like, [00:42:00] forget about it. Right? But there's a last mile problem here, which is to say that like all of the guests on your show are solving, you know, for the most part, uh, they have a customer at the end of that who's, you know, not a grid carbon emissions expert who hasn't read the geg protocol, who doesn't even, you know, again, sort of barely understand their own energy spend and is now counting on this relationship that they have.
Yeah. To help them navigate this new world that we're in. We're no longer managing around energy, we're managing around carbon. So what does that mean? And so there are companies out there and individuals in these companies who are doing wonderful. Uh, to, um, to, to illuminate, you know, how carbon can, can impact investment decisions into buildings and, and all the rest who are engaging employees who are, you know, creating reporting infrastructure for, um, you know, for different, uh, regulatory frameworks, [00:43:00] but who, who aren't data scientists, who don't, aren't data engineers, uh, by training and, and don't wanna hire a staff of 8, 10, 12 data engineers and spend a year kind of building all the infrastructure you need to do this the right way.
So if as an industry we want to be serious about carbon accounting and drive, you know, carbon related outcomes, we have to have some sort of like way to actually wrap our heads around, you know, what's actually going. Creating an API around that, which is really just kind of pulling together a bunch of other APIs.
Um, but solving for all those kind of complicated data issues that always arise and slow down these, these, these, um, these initiatives so that out the gate you can provide carbon reporting to your clients. Uh, out the gate, you've got a new startup up and you're doing, you know, we've got one, we've got, um, a company that's doing employee engagement so that, you know, when they do emissions reductions at home, uh, then, um, the, the company rewards [00:44:00] them for that and the company can kind of claim some of those emission credits for themselves.
But like they need the data underneath all that Terry to make that work, right? And so they can just build on our API and we're building on, you know, Singularities API and utility API and, you know, all these other, um, kind of formative foundational pieces of our industry. To be able to unify carbon accounting in a way that makes it accessible to all those other companies that are doing this good work.
Yeah, and that was my first thought, like I
[00:44:27] James Dice: said last week at this conference I was at, is I feel that there are a ton of application providers out there and data layer providers that should be connecting into your api basically saying like, Okay, I have, I have energy data right now. If I wanna turn that into carbon and I do it myself, it's gonna be wrong.
I might as well, you know, provided in the most accurate way and kind of build on everything that you guys have already built. Um, can you talk about the importance of [00:45:00] transparency in these calculations? Because that's a, that's a sort of a, a tangent, but an important one to that conversation, which is, You could do it in a black box way, or you could do it in a way that says, I've covered all these different edge cases and I've done it in this way, and here's my math and here's how I calculate savings and that type of thing.
I, I know it's one of your sort of core values, so can you talk
[00:45:23] McGee Young: about that piece? Yeah. It, it became, um, you know, really evident when we were building the, the markets at, at Recurve, that if you weren't doing this in a, you know, transparent, reproducible, auditable way, that nobody would trust your numbers.
And because there's no right answer, right? So the question just became like, how did you get to the number? And can we all agree that it may not be perfect in all cases, but at least we know how you got it and this is the least wrong way to do it. Yeah, Yeah. And if you open it up to like, we got a lot of really great input from folks that improved how we, [00:46:00] you know, the development of Cal Track was a consensus process and as painful as that was, you know, like I owe a lot to Ken Agnew and you know, the people who have been doing this for, for 20 years, uh, who, you know, beat it into us that we needed to do things, you know, like better.
Um, so. With carbon accounting, it's, it's quite similar, right? There's, and there's unfortunately a lot of greenwashing that happens now with, you know, different ways of kind of accounting for emissions or emissions reductions. We saw this with the carbon offsets, you know, with the trees in California that didn't really exist.
Um, and if we're gonna, you know, be serious about decarbonizing buildings, then we should be transparent about the methods that we use, the data we use to come up with the numbers that, that, that we use. And, um, and so this goes, you know, up and down the full stack. So the first thing that I did when I started to work on this was I called up my friend Julie Goodman, who runs, who's [00:47:00] the executive director of LF Energy, which is the Linux Foundation's Energy Division.
And I said, Julie, I, I'm really interested in this, you know, carbon accounting, uh, work that's emerging and it's intersection with energy, but there's a lot of. Different claims that are being made around emissions. Most of it is like, and this is equal to a thousand trees, and, and, and it sort of like rings hollow, you know, like when you said, you know, like, okay.
Um, and so we actually put together, um, a working group, it's called the Carbon Data Specification Consortium that, um, it brought together, you know, Google and Microsoft and, and some of the software companies, some of the rec companies, um, both in Europe and, and the United States, um, to actually like work on a set of standards that we could use for the underlying emissions data from the grid so that we could all be talking about the same thing when we talked about this is what we mean when we say X, Y, and Z, you know, emissions.
But that goes all the way up to [00:48:00] stack. So if I'm going to be using that data, using building data, creating a counterfactual to, um, establish, you know, a savings benchmark for a project that's been done. All of that really needs to be done with an eye towards transparency, rep, replicability, auditability, so that it can have the credibility it needs to be used, you know, to actually make decisions around optimizing for carbon.
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[00:49:07] McGee Young: So I, yeah, I
[00:49:08] James Dice: totally agree. Let's switch gears a a little bit, um, and talk about kind of this new direction, I'd say new direction. It's really what you're building on top of the data platform. So
[00:49:20] McGee Young: it sounds like the
[00:49:20] James Dice: API is able to be used by anyone that wants to sort of piggyback on the work you guys have done, but you're also headed towards building this marketplace.
Um, can you talk about kind of why you feel like a marketplace is needed and kind of the thinking
[00:49:36] McGee Young: behind that? Yeah. Plant heat pumps, not trees.
Uh, I mean, this kind of goes back to the origin story, right? Like we, we, we've we're spending billions of dollars a year on, on nature based assets. And a lot of those are really great projects that do, you know, some, some amazing work, [00:50:00] really novel technologies being developed to capture con, you know, carbon and put it in the concrete or to, um, you know, take corn cobs and turn 'em into oil and pump it down into the ground.
And, and, and frankly, like not cutting down trees is, is a pretty good, pretty good plan, uh, for us. But it's not really the root of the problem. The problem isn't that we have is isn't that we cut down too many trees, is that we're continuing to emit, you know, millions and billions of tons of, of CO2 every year.
And unless we stop doing that, it, we can't plant enough trees, uh, to, um, you know, to get us out of the problem. And so we have to decarbonize buildings that's, you know, 30, 35% give or take of our emissions. But going back to your heat pump, your hot water heater 20,000 times a day, the guy shows up at your door when your water heater breaks or your furnace breaks and brings the natural gas version with him on.
Yeah, that's what he is. Gotten the truck. [00:51:00] And you as the like, thoughtful, you know, you're gonna push back and say, No, I want the, the, you know, the electric version. And he's gonna say, No, no, no, no, you don't want that. You know, it like breaks down or like whatever, because it's a pain in the butt to install and it's, it's, you know, the profit margin goes way down.
He's gotta train his guys on how to do this. Um, there's so many barriers to actually doing the environmentally correct thing, and the only way that we have to justify it right now is either our conscience. Or the bill savings. And the bill savings aren't really there for the most part. And like, not my, not in my case.
Yeah. And our conscience is good, but it's like, not gonna, doesn't scale. Yeah. Uh, so how could we think about maybe then taking this idea of, okay, like let's spend money to get an environmentally beneficial outcome. Like not cutting down trees, but think about that. But buildings as a source of our [00:52:00] offsets.
So could I buy the environmental benefits of putting in an electric, you know, heat pump ahead of time so that when the guy came to your door, he said, James, I got this great deal on this, you know, high efficiency heat pump, water heater, and it's not gonna cost you anything out of pocket. And, um, you know, and it's great for you and your family and Oh, and, and you're like, Oh my gosh, this is so great.
Because your plumber is getting paid on the back end for the environmental benefits associated with the project that he has now sold you. Right? And if we could do that at scale, if we could invest in buildings for their decarbonization potential and use the offset money that's now going to fund, you know, pre preservation instead to fund building decarbonization, we can both achieve the principles of offsets in the first place, which is to kind of keep us in balance, but also be driving permanent and, [00:53:00] um, and, and actually transformative decarbonization projects in our buildings and homes.
I
[00:53:06] James Dice: love this. Um, I want that plumber to show up in my house like tomorrow. I'd love that. Um, let's do this. Let's build this thing. Um, Connect that vision of my house and my future plumber. Connect that to say the biggest reach in the industry, in the office industry or whatever. Connect that to those guys who are out there buying extremely cheap offsets today.
And maybe they have a future, um, goal in the future of being, you know, not buying any offset's, being totally net zero at some point in the future. So they're looking at this, you know, portfolio and saying, we have to get to this future point. How can this idea sort of help them
[00:53:54] McGee Young: along their, their roadmap?
I think there's a, there's a [00:54:00] just an amazing potential here. Um, so, so first of all, if I'm a, you know, property owner of any, any sort, I, like, I think about my own house, it, it's gonna cost me $1,800 a ton. CO2 to, to kind of reduce my carbon footprint. I'd much rather go, you know, instead of that spend, you know, say $200 a ton to help fund heat pump projects, you know, in Fresno say mm-hmm.
right. So there's, um, already sort of an allocation of resources here that we can be a lot more thoughtful about. Um, and so, and if I'm buying, um, you know, carbon offsets that are, you know, maybe like really cheap right now, um, maybe that's a sign that you're not really, you know, moving the needle, that this is greenwashing and, and not really the where, where, where you want, you know?
Do you want to end up on John Oliver? Is the question that a lot of carbon offset buyers are asking themselves right now? Um, but what's I think is really exciting about this. There's so of all of the things that I [00:55:00] think kind of for a re to think about, um, what if we started to think about these investments into buildings themselves as PPAs.
We would buy a PPA for, you know, a big solar facility, but, but distribute them. And, and so I'm buying the cash flow of, of a, of your heat pump project. For example, you're gonna pay me back over the next, you know, five or 10 years or so for the cost of that. But in, in exchange for that, you also give, I own the environmental rights to that project.
And so now the offset, as it were, comes with the cash flow associated with the heat pump project that we just financed. And what if we remade the, the capital stack for buildings around the impact of on carbon emissions that projects would have in those buildings. So I could make a fortune as a reit decarbonizing buildings.
This, this, you know, this is a world that I wanna live in, [00:56:00] right? Where, where now we have opened up, uh, unlocked new pathways to allocate capital that result in envir in fundamentally transformative environmental improvements based in the built environment. That's where we see kind of the big opportunity for like institutional investors to think about how do I make money and at the same time, decarbonize the buildings that I'm both responsible for directly as well as potentially in my community that, that, that could use those extra resources being invested in them.
So re
[00:56:30] James Dice: could or re could eventually say, I'm gonna put this, allocate this money to decarbonize my own buildings and then reap the rewards financially of that. Or they could say, I'm gonna take that money and find it, uh, a higher impact home elsewhere that decarbonize other people's buildings. Mm-hmm. . And what you wanna build is the marketplace where those decisions and those transactions can be
[00:56:53] McGee Young: made precisely, precisely.
So I, I think
[00:56:58] James Dice: one piece of this that I'd like to [00:57:00] get your take on is going back to John Oliver, where it's kind of, I think people, you know, maybe a couple years ago were, were saying, we're just gonna go buy offsets and we're gonna be carbon neutral. And I think that has gotten to a point even before John Oliver special, which we'll, we'll link to in the show notes, show notes, um, even before that was published, obviously people in our industry had soured on offsets.
It's kind of viewed as like a transition that I'm gonna put in my marketing materials until I can get a better idea about what to do in the future. So I think people agree, like, they're probably not good, but like, how, in your mind, can we make them good in this, in this future vision that you have?
[00:57:50] McGee Young: I, I think about, um, I was on the phone with a, with a.
A company that's managing, managing some buildings that have, um, [00:58:00] highly sensitive materials in them and, and they, you know, they don't really wanna mess around today with today's technology, um, with other ways of keeping that building cool. Of keeping the air circulating because of the sensitivity of the materials inside that building.
Yeah. Mm-hmm. . Um, now we can quantify exactly the environmental impact so that that choice that we're making, right. Um, on keeping, and it may be worth it, right? It may be worth burning natural gas or whatever to keep the, the stuff that's in that building from, you know, approaching the environment or, or whatever it is that it might be.
But it doesn't mean that we have to sort of ignore that. We could take that and we could offset that impact that we, that we sort of are okay with having, uh, with. A reduced impact someplace else. So if I put a, a heat pump into your house and to a thousand other houses, that might equal the impact that [00:59:00] that building is, is having now, that building's gonna keep having that impact every year.
So we're gonna have to find more and more heat pumps, you know, to put into buildings year after year that will have permanent reductions in emissions forever, because we're probably not gonna go back to not heat pumps, you know, um, once, once the useful life of yours is up. And so actually we think about this as a tradeoff between there are some uses of fossil fuels that we're going to be okay with.
And if instead of trying to mitigate that by saying, Well, let's not cut down a tree and then it'll absorb the CO2 that's emitted, let's actually use that to make an investment into actual decarbonization. We end up having a much, actually, it's like a transformative effect. And if we did it today, like what if every single organization on the planet today committed to net zero today and, and spent all of the money that would be required to like, you know, eliminate their emissions [01:00:00] impact today on decarbonization, they just said, Will, like, we're just gonna put all of the money now into decarbonization.
The transformative effect globally would be like something we couldn't even contemplate. Right? And, and for sure we're gonna have to like, cut down on some of those. We're gonna have to eventually, you know, drill and, and burn less oil and we're gonna have to stop, you know, burning coal. But in the interim, there's so much that we can do to clean up our environment to trans, to transition to more sustainable systems.
The amount of capital that we could harness right away through assets might just be what we need to make it to, you know, to next year and to the year after, to keep hitting those interim goals on the way to a sustainable planet. Totally. Talk to me a little bit about, a bit about cost. So,
[01:00:48] James Dice: um, I had someone tell me that they're last week, that they're buying offsets for $8 a ton or something like that.
Where is that number? If it were high [01:01:00] quality decarbonizing a, a building, where should that number be at? In other words, what I'm getting at is like, how can we get people to understand the cost increase to go from greenwashing offsets? Uh, which I have a feeling that that $8 per ton number is probably in that category, but like, what's the high, Like what should people be spending on offsets that gets them actual decarbonization in your mind?
How does that even calculation to get to cost? What are the
[01:01:32] McGee Young: factors there? Yeah. I think about when I was in college and we lived off of, uh, 25 cents a package. Ramen noodle is soup, right? Yep. That you can feed yourself with that. Sure. Amazingly, you know, like sustained ourselves on, on that for a shockingly long time.
Probably not the best longer term strategy for Yeah. Help. Um, that's
[01:01:58] James Dice: like Yvonne [01:02:00] Ard, the CEO of Patagonia, he lived off of, uh, dented cat food cans when he was a dirtbag in Yosemite
[01:02:09] McGee Young: a long time ago. Yeah. Right. Again, doable but not maybe sustainable. , uh, the, the social cost of carbon has been recently reactivated to be somewhere in the neighborhood of $150 per ton.
Okay. Um, that, you know, strikes me as a more realistic, uh, figure. But the thing about it decarbonization is that it's not cheap. Right. Like it costs a lot of money to put in, you know, heat pumps and solar panels. And, and even if, you know, the, the longer, if you can make the investment and have a longer term, you know, roi, that that pencils out.
It's still a cost of capital. And, and these are. And I think that we're fooling ourselves if we think that, you know, $8 a ton is gonna get us very far with actual decarbonizing buildings. We have this, you know, avoided [01:03:00] cost concept in the energy space. You know, for a utility in order for it to make sense for a utility program has to like pass the avoided cost test.
But that's a very different test than the achieve our policy goals test. And so when we think about decarbonization, we should be thinking about the cost in terms of like, what's it actually going to take to be able to decarbonize buildings. And it's probably gonna be closer to that $150 per ton than the $8 a time.
Now if you want it for cheap, then you just buy the whole project and have, you know, take on the risk of that repayment over time and there'll be some bill savings, There'll be some other ways in which you can make those, those numbers pencil out. Um, but you know, it's kinda like in the world of software development.
There's good, there's cheap and there's fast, but you can only pick two. And, and so in the world of, of carbon offset, if you're, if you're anchoring. On, uh, on cheap, uh, you're probably sacrificing, you know, in on one of those other areas. Absolutely. Okay. So you guys are planning on building out this marketplace where
[01:03:59] James Dice: [01:04:00] the supply side is people that are doing out there, you know, contractors or developers that are out there doing decarbonization projects like the plumber that's gonna install my water heater like that, that's
[01:04:13] McGee Young: the supply side.
Um, the buyer side is
[01:04:16] James Dice: like, um, the organizations that are looking to, you know, get rid of their carbon emissions. Right? So can you gimme some examples of more examples of the supply side? Cause we've been talking about heat pumps this whole time. What else might this marketplace be filled up with? All the different ways in which, uh, car decarbonization in buildings can
[01:04:39] McGee Young: happen?
One of my kind of motivators for thinking about this was I saw this incredible transition in the marketing materials of all of the companies that show up at like re plus or, you know, the other like energy companies that are, have now rebranded to become decarbonization companies. Mm-hmm. . Yeah. And, um, I was sort of like annoyed [01:05:00] by it at first because it felt like just opportunism.
Like they're doing the same thing they did last year, you know, but now it's called decarbonization. But the reality is, is that they are decarbonizing buildings. Um, the work that we've been doing for 20 years is the right work to be doing. We just don't have a metric to measure ourselves against and a way to value that, that work.
And so, um, you know, there's an important aspect of this in the world of offsets. Um, the, the term is additionality. And what, you know, offset purchases get dinged for. And where, you know, in the world of, of energy, this happens with Rex a lot, is that you have a, a wreck is generated every time a megawatt hour of energy is produced.
But that, you know, say the solar farm that is coming from might have been built 10 years ago. Mm-hmm. , if you buy a wreck from a solar farm that was built 10 years ago, like really, how much of an impact are you having? Right, Right. So, additionality requires us to raise the bar a little bit and to say, uh, you know, we're gonna [01:06:00] be funding projects that that haven't happened yet, and we're gonna be using the funding specifically to.
Turn buyers or turn, you know, the end customer from a no to a yes, right? Where they, they wouldn't have done the environmentally good thing before, but now there's the offset there to kind of juice the pu a little bit. And so now we're gonna get to, yes. And so you do that through a contractor whose job it is, is to get you to say yes at the lowest possible and keep as much money in his pocket for himself as he possibly can, uh, by their very, you know, like not nothing wrong with it, right?
Like this is actually like a good thing because that means that the offset dollars go to build that contractor's business as much as it does to, um, support projects. That would've happened anyway, right? If you were gonna, if he came to your house, none of that rebate money would actually get a go to you because he, he'd look around and see all the books on your walls and like, and he like, You're just gonna pay full freight for this cuz I know you're gonna, I'm not passing the savings on to you.
[01:07:00] Exactly. Whereas, you know, your neighbor, uh, you know, Takes a look at the big truck in the driveway and the American flag or whatever, and, and goes, I'm gonna need to actually, you know, kind of entice you with some extra, you know, the berry gold water sticker on the bumper. Um, and so that's the, that's the way in which, you know, we wanna make sure the market doesn't just.
Um, reinforce decisions that were already going to be made, right? We're not just subsidizing the rich as we're, in fact, we're targeting those really hard to reach customers who need that extra incentive through their contractors, but then use your imagination a little. And you have, you know, solar contractors going out and putting solar panels on, on homes, heat pumps, electrification generally is a, is a really great, Um, but energy efficiency also, you know, delivers carbon savings, demand response.
So we're putting in batteries, you know, smart thermostats in commercial buildings. All of the controls and lighting systems can now be [01:08:00] optimized for a carbon signal. Um, and not just, um, an energy, you know, energy arbitrage signal or, or, you know, lowering your bills. Uh, and so, you know, we're really excited.
You know, we've been meeting. Dozens of companies, you know, in the last, you know, month or so as we've been working on this, who I've actually been quite surprised by the diversity of mm-hmm. ingenuity that's, that's already out there in terms of like clever ways of thinking about how to get projects into buildings that result in real carbon emissions.
And I'm actually kind of excited to be able to showcase more and more of them that people don't really realize that the, the good work that's getting done already and to be able to drive more revenue into them for the environmental benefits that they're delivering feels like a win-win altogether.
Totally. And then not only ensure for
[01:08:47] James Dice: an additionality, but like you said earlier, ensure for, um, ensure that
[01:08:52] McGee Young: that energy that's
[01:08:53] James Dice: being pumped into the grid or lack of energy that's being, um, consumed is matched with [01:09:00] location, location emissions. Right. And the temporal, or as you say it, the, the time of day that the emissions are happening.
So the ability to then match. That project with what your data platform is calculating as the carbon emissions is the
[01:09:15] McGee Young: key. Yeah, it totally, And, and you know, the fun, the real work is really interesting within the platform is that, We can pull in the data from the buyers themselves, right? So you're, you know, say Walmart, you load in all of the, you know, energy use data on an hourly basis from all of your buildings across the country.
All of the Rex that you've purchased, all the PPAs that you've purchased, and now you have new portfolios of carbon offset projects that are, have the same hourly locational accounting as all of your buildings. And so it looks like just another way to manage your energy spend and your carbon spend, but with buildings that are, that are with projects that are [01:10:00] happening in your communities.
And it's a little bit of a different story to tell as an organization about not only do we care about our own emissions, our own footprint, but we're really deeply invested in, you know, our communities and, um, the health and wellbeing. And, and, and honestly as, as energy prices continue to increase, there's a financial component to this.
There's a lot of the companies, you know, that we talk to on the buy. You know, we're talking to their ESG group and we tend to focus a lot on the e the environment, which we're synonymous with energy in, in a lot of ways. But the s is actually like, present, you know, and a lot of these conversations and, and we think about, you know, as energy prices go up, people like you and me, James, we're gonna put in our solar panels, we're gonna optimize, you know, low.
We're gonna have the wherewithal to be able to lower our bills. There are quite a few, you know, renters, uh, you know, low income, uh, households in general who are gonna be left behind and who are gonna be, you know, [01:11:00] facing higher and higher bills and increasingly difficult to try to transition because of the overall scarcity of, you know, it's, it's gonna be hard to get a contractor.
I have a hard time getting a contractor to show up to my house and I. Full afraid, and I, you know, know I'm doing, and a modern house, like to get access, you know, into some of those other communities is, is really gonna be a challenge. And so companies that have a strong, you know, e and s, um, uh, a social dimension to the thinking, they're thinking about buying assets, um, I think are gonna be really well positioned to be able to tell a powerful story about how those assets they're purchasing from their community are having, uh, multiple sets of effects, um, positive effects from, from those investments.
Love it. So you build up the
[01:11:46] James Dice: data platform, you're headed towards, blooming out this marketplace where, talk to me about 10 years from now where the company's gonna be
[01:11:54] McGee Young: as you look forward. Yeah, we're, uh, you know, as a startup [01:12:00] you always have to take it one day at a time and, you know, focus on the next thing.
But, uh, in, in 10 years, you know, most of our. Midterm net zero goals will have been not met. And, um, you know, as we think today, we have still a little bit of luxury. Um, you know, it's not that hot in the summertime. The storms aren't that bad. We're about to see a huge hurricane hit Florida. Uh, we saw a summer of, of, you know, climate catastrophe, you know, across the planet.
This is the, the mildest weather year we'll have for the rest of our life. So in 10 years, it's going to be, you know, all that more critical that we're able to really smartly deliver decarbonization solutions, not just in the United States, but globally. And so our, you know, obviously we want to be able to focus on the things that we can focus on today, which typically has a US [01:13:00] focus.
But I'm really excited about like, how do we decarbonize Mexico City or, you know, Logos or, you know, Bangkok or, you know, like there's, you know, there, the, the, the challenge ahead of us is, is almost, it's almost overwhelming in a way, but if we can start to leverage capital in a smart, thoughtful way, I think we can have an impact that goes far beyond our own borders to be able to improve the lives of the, you know, billions of people who are gonna be really affected by climate change over the next decade.
Love it. I'm excited
[01:13:36] James Dice: about this. Um, let's close with some carve-outs. Uh, I'd love to hear something that you would think people should, uh, check out these days. Book, podcast, TV show. I know you don't listen to podcast, movies, documentaries, et cetera. What, what should, what should we point people towards?
[01:13:55] McGee Young: Uh, geez.
Well, my, my one. Is NBA [01:14:00] basketball. Uh, so I'm, I'm really excited for it, for the, for the upcoming season to see if the, the doves repeat uhhuh. You guys, you guys have a good team in Denver there. So that will be, uh, an interesting, I think right now I like to watch, if I watch tv, I, I love kind of entrepreneurial themes.
Um, Breaking bad, for example, you know, is a good, uh, I, I'm watching, uh, Narcos Mexico right now. Okay. Which is the story of the Mexican drug cartel. It builds on the first narcos, which was the story of the, um, Columbian drug cartel. But the Mexican drug cartel is a fascinating look at, you know, the mid eighties, the, you know, transition from kind of like, local, marijuana, you know, what do they call just these local distributed organizations that are trying to sell weed to American kids, and all of a sudden they, you know, they get.
And it's, it's a, it's a founder story, right? This guy gonna talk about like [01:15:00] scale, right? These guys, you know, scaled to, to billions of dollars in revenue in just a few years, they diversified to cocaine and started working with the Columbian. And it's a, it's a classic entrepreneurial tale with, you know, like some, it's like more interesting in a lot of ways than the kind of stuff that we work on, right?
And the stakes are a little higher, so there's a lot of murder and, and uh, you know, the guys like definitely stressed out, right? So I feel helps me feel like, okay, my job's not that stressful. At least I don't have like all these people trying to kill me on the daily basis. Yeah, you're not on the other side at the law.
Totally. Highly recommend Narcos, Mexico if anybody's into entrepreneurial TV shows. I love it. I love it. Um,
[01:15:42] James Dice: okay, so mine, I'm gonna share a couple. Um, one is I read, uh, one to 10. It's a book by, uh, former podcast Guest Rags Gupta. Um, the premise is one of my favorite books is Zero to One, Written by Peter Teal.
You've probably read it as well. [01:16:00] But Rags took it and said, Okay, well what if you're at one? You have customers, you have product market fit, like how do you get to 10? Um, and he's done it a couple times and it was just fun to read it. I read it on the plane to Boston last week, and then I had dinner with Rags when I got there.
So it was like this amazing, uh, uh, kind of full circle moment for me as the, you know, the founder of this fun community. Um, another one is, I, I, you probably would enjoy this book, which is why I wanted to share it with you. Um, I read it over the weekend. It's called Training for the Uphill Athlete. And when they say Uphill Athlete, they're talking about, um, cyclists like you, trail runners like me, um, ski mountaineers, like any money that does a lot with their quads to, to gain elevation basically.
Um, and it's just like a deep dive into. Uh, biochemistry on how our muscles use energy and how to like, build and [01:17:00] maintain and sustain endurance. And I just, I found it fascinating. I couldn't put it down all week, and I like, have a new sort of roadmap for my running after reading it. So if anyone's like me that likes to nerd out on that kind of thing, definitely check that out.
Um, well, thanks McGee. Uh, I'd love, love to dive into this. You've taught me a lot with sort of understanding what you're building. Um, I'm so glad to share it with everybody else.
[01:17:27] McGee Young: Yeah, thanks for having me on. Uh, it's, it's still fun and, and, uh, even though I've, I don't listen to your show. I, I read the transcripts, uh, so I'm, I'm a big fan of the transcripts of your shows.
Well,
[01:17:39] James Dice: we'll have to do a better job of editing them for you than I know that I, I don't know very many people
[01:17:46] McGee Young: that just
[01:17:46] James Dice: listen to transcripts. So, um, if that's you out there listeners, uh, I guess. That would be hard for them to hear this.
[01:17:54] McGee Young: If someone's reading without reading this on the transcript transcript, they're still with us.
This is [01:18:00] for you. This is
[01:18:01] James Dice: for you. Yeah. Um, but let me know because we could probably spend more time cleaning them up, uh, because machine learning is not a hundred percent accurate at this point yet. Um, anyway, thanks so
[01:18:13] McGee Young: much. Talk to you soon. All right. Thank you.
Disclosure: Nexus Labs Syndicate is an investor in WattCarbon.
“They're doing the same thing they did last year, but now it's called decarbonization. But the reality is, is that they are decarbonizing buildings. The work that we've been doing for 20 years is the right work to be doing we just don't have a metric to measure ourselves against and a way to value that work."
—McGee Young
Welcome to Nexus, a newsletter and podcast for smart people applying smart building technology—hosted by James Dice. If you’re new to Nexus, you might want to start here.
The Nexus podcast (Apple | Spotify | YouTube | Other apps) is our chance to explore and learn with the brightest in our industry—together. The project is directly funded by listeners like you who have joined the Nexus Pro membership community.
You can join Nexus Pro to get a weekly-ish deep dive, access to the Nexus Vendor Landscape, and invites to exclusive events with a community of smart buildings nerds.
A quick community announcement before we dive in: Now that Cohort 5 of our Foundations course is launched, I want to make sure everyone knows that we also do private cohorts. All of you do onboarding when you hire new people… think of this as industry onboarding. We host teams of 10 or more and teach the smart buildings industry to them in a private setting. Hit us up to get on our schedule.
Episode 120 is a conversation with McGee Young, founder and CEO of WattCarbon.
We outline one of the most important journeys I think our industry needs to go on: The transition from energy management to carbon reduction, from lowest-cost carbon accounting to highest impact carbon accounting, and from any renewables are good to valuing renewables based on location and time of production.
Underpinning all of that is the need for a data platform to help calculate, understand, and value carbon and unite energy consumed in buildings or produced by DERs with the carbon-intensity of the grid at that location and time. That’s what WattCarbon is building.
Without further ado, please enjoy the Nexus podcast with McGee Young
A message from our partner, Montgomery Technologies:
Cybersecurity, change management, remote access, and data integrity across 8-10 siloed systems per building presents a significant challenge for CRE operations. Just knowing where everything is, how it is connected, and where it is connected can be too much for thinly-staffed corporate IT departments, whose primary function is to oversee the corporate network.
🎥 Watch this quick explainer video to learn how a converged network fills this gap, solves for all the above, and is the first step to enabling a Smart Building.
You can find McGee on LinkedIn.
Enjoy!
A message from our partner, enVerid Systems:
Improving indoor air quality (IAQ) with optimized ventilation and air cleaning need not conflict with building decarbonization and climate resilience goals.
Read enVerid's new white paper, How to Achieve Sustainable Indoor Air Quality, to learn how a four-step Clean First approach can be used to design and operate low-energy, high-IAQ, climate resilient buildings of the future.
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Music credit: Dream Big by Audiobinger—licensed under an Attribution-NonCommercial-ShareAlike License.
Note: transcript was created using an imperfect machine learning tool and lightly edited by a human (so you can get the gist). Please forgive errors!
[00:00:33] James Dice: Our first sponsor on the show had to be Montgomery technologies. Their COO Joe grasper, Doni is easily. The number one fan of the show. No offense, of course, to any of you, other hardcore listeners out there, but Joe listens to every episode sometimes more than once. And then he gives me his feedback via email. Good, bad, or otherwise.
Joe as a podcast host dream. And I think you've made me a much better interviewer. Jonas team liked to remind all of you of [00:01:00] the importance of the network layer and the smart building stack. Technology installed in buildings placed a heavy burden on commercial real estate operations teams.
Cybersecurity change management road, access data. Integrity across all the different siloed systems in the building presents a significant challenge, just knowing where everything is, how it is connected, where it is connected can be too much for thinly staffed, corporate it departments. Their primary function is to oversee the corporate network, not all of these systems in the network.
So learn how a converged network fills this gap. By clicking the link in the show notes, it shows how a converged network solves for all of the above and is the first step to enabling a smarter building.
This episode is a conversation with McGee young founder and CEO of wok carbon. We outline one of the most important journeys. I think our industry needs to go on this transition from energy management to carbon reduction from lowest cost carbon accounting to highest impact carbon accounting. And from renewables are good to value renewables based on [00:02:00] location and time of production.
Underpinning all of that is the need for a data platform to help calculate, understand, and value carbon and unite the energy consumed in buildings or produced by. Distributed energy resources with the carbon intensity of the cred at that location in time. And that's what wall carbon is building. Equip community announcement. Before we dive in, now that cohort five of our foundations courses launched. I want to make sure everyone knows that we also do private cohorts.
So all of you in the industry do onboarding when you hire new people, think of our foundation's course as industry onboarding. We host teams of 10 or more and teach the smart buildings industry to them in a private setting for your context. So hit us up to get on our schedule without further ado. Please enjoy the nexus podcast with Mickey
[00:02:47] James Dice: Hey McGee, welcome to the show. Can you
[00:02:50] McGee Young: introduce yourself? Uh, thanks James. Uh, hi everybody. I'm McGee Young. I'm the founder and CEO of Wat Carbon. Yeah,
[00:02:58] James Dice: I'd love to hear more about [00:03:00] your background. Can you, can you go a little bit deeper? What'd you study in school? And then take us through from there all the
[00:03:07] McGee Young: way to today,
Yeah, sure. Um, I was a, I was actually a political scientist as a, as an undergraduate, as a graduate student. I got a PhD in political science and then I taught for 10 years at Marquette University in their political science department where they gave me tenure. And, um, a few months later I walked into my president's office and said, I'd like to retire, please.
And they looked at me like I was crazy. They said, I don't think you're old enough for that. Um, so, well, I think I quit and um, and then I left and came out here to do startups. Amazing,
[00:03:46] James Dice: amazing. You have to explain this epiphany to me. So how long had you been studying for, and then how long did it take you to decide to quit and why'd you quit?
[00:03:56] McGee Young: Well, it was, yeah, I, I graduated from, from undergrad, you [00:04:00] know, not knowing really what I wanted to do. So, of course, you know, grad school seemed like a reasonable place to, you know, camp out for a while. Got it. Okay. And then, You, you kind of get wrapped up in it and you know, they're like, Well, you know, you're gonna get your PhD right?
And they're like, I guess so. And it's like, well, you gotta go get a job now, right? Yeah. And then you gotta get, write a book and get tenure and you just sort of get on that treadmill. And, but Marquette was, uh, was a great place to be at. And, and one of the things I got involved with there was, uh, setting up a social entrepreneurship program.
Mm. Okay. And, um, I started to incorporate that into my classes. I actually started two companies while I was a professor and, you know, so I was, um, you know, way more interested in doing that part of my job than doing the like actual, you know, professor part of my job. And so once I had kind of gotten through the milestone of getting tenure, there was nothing really left to kind of prove.
Academically mm-hmm. . And so I felt like [00:05:00] it just made sense to go do the thing that I was really excited about doing. And so I had a, an unprofitable software startup and I thought it makes total sense for me to relocate my family to the Bay Area to try to pursue this in a place twice as expensive. And, and of course that didn't work.
Um, but, um, I ended up, uh, getting a job out here as the first employee of a company called Open Energy Efficiency, and, uh, which later became known as recur. And, um, and so I spent five years as the CTO at recurve building measurement and verification software for utilities to measure their demand side energy programs.
And so that was really my, you know, indoctrination into the, into the depths of, of, you know, energy modeling and, and, and the energy industry, um, in general.
[00:05:47] James Dice: okay. So how'd you go from political science
[00:05:51] McGee Young: professor to
[00:05:53] James Dice: cto? Explain to me how the educational process works to, to make that transition happen.[00:06:00]
[00:06:00] McGee Young: So the, so the, my, my kids make fun of me cuz like, as a political scientist, you really don't have any skills, right? I like, you know, I joke that I'm a doctor and, and it's like that, you know, it gets more laughs but, um, you know, for the world of energy, um, you know, I had, so I had started to, to learn software and to build, you know, software products, um, as in my first couple of companies.
So there I have, you know, sort of a passing familiarity with some of those principles, but really in the world of, of energy and, and, you know, m and v. The bulk of the technical work is actually in the modeling. And a lot of the work that we're doing and at Recurve was, you know, kind of regression based, modeling the same types of methods that frankly we used in political science to study elections and, and that I see.
So, um, it wasn't actually, it was a different, a lot of different acronyms, . Um, but, but that was also kind of like, you know, as it, it, as you get into, you know, the world of academia, you have to [00:07:00] learn a lot of different, you know, kinds of esoteric concepts. And so energy sort of fits quite nicely and with, oddly enough, political science and half of the work, you know, that we do is policy work.
Uh, Right. So having a deep appreciation for how policy gets made and, you know, understanding, you know, federalism and, and those, um, you know, institutional kinds of, um, Or, you know, ways in which decisions get made and, and executed on and some of the like limits that we have, uh, to being able to do things, uh, really like kind of paid off, um, in a lot of ways, you know, definitely at Recurve and, and, and certainly the work I'm doing now.
Totally.
[00:07:43] James Dice: So we had about a year and a half ago had, um, Matt Golden on the podcast. So can you talk a little bit about, maybe review for people, kind of the work you did at, at recur and sort of give us a sort of, you know, 32nd overview of [00:08:00] Cal Track and the things that you guys developed there that were
[00:08:02] McGee Young: novel?
Yeah. In the world of energy efficiency, m and v, the challenge that, that that industry has faced is that you put a hundred engineers in a room and ask them to measure the savings of a. And you get a hundred different answers. Mm-hmm. . And the problem is that they're all right. And so when you try to build, you know, um, so if you wanted to build markets around energy savings, you know, it, it ends up looking like the ESCO industry with, you know, 200 page legal documents, you know, describing how exactly you're going to get out of the obligations that you've put yourself into in the first place with the contract.
And, and so this was really a, you know, Matt saw this, you know, quite acutely, um, that this presented a real barrier to being able to scale energy efficiency, you know, markets in, in particular, um, especially as we start to transition into the, these newer kind of forms of virtual power plants and flexibility markets, um, integrating demand response and energy efficiency.
And so we had to really kind of like [00:09:00] figure out how would you, if you were to standardize, you know, a measurement in verification calculation, and if you were to use hourly energy data so that you could really dial in. The particular value for energy savings at particular times a day. How could you develop a framework in which that measurement and verification could be more or less universal?
Right? So that any organization that was delivering demand side energy savings could presumably participate in a market that was set up to do that. And it took us, you know, five years of, of, you know, like kind of in, in stages, right? We did CalTRACK 1.0, which established methods for using meter data for, you know, daily and monthly, you know, uh, granularity of, of data.
Then CalTRACK 2.0, which really honed in on the hourly methodology. Mm-hmm. . And then, you know, we kind of didn't really call it Cal Track 3.0, but the, the last kind of big [00:10:00] lift was post covid. How do you. Create comparison groups that would allow you to, uh, account for major disruptions. Like the world shuts down and everybody's energy use is a lot different.
Um, how does my, how I can't really do like a pre-post anymore. I have to do more of a broader comparative, um, methodology. So how do you go find doppelganger buildings to the ones that you're looking at so that you can, um, kind of account for those out, those external conditions as you're doing your mnv.
So all of those became, you know, kind of core to thinking about, Okay, so what if you took that, you know, kind of universality of meter based measurement verification and weren't just thinking about it in terms of like energy markets or, you know, demand side energy programs, but really like building decarbonization in a broader sense.
And could we actually, you know, since we're now generating revenue grade meter [00:11:00] metered savings, Uh, for energy programs, could we come with a, come up with a way to do the same thing for buildings for decarbonization that would allow us to invest in be decarbonization, um, broadly in buildings, right? Not just as a response to an energy price signal, but to the, the degree to which their responsible for carbon emissions.
This is 35% of our carbon emissions, you know, on an annual basis is coming from our buildings. And so unlocking them as trying to kind of assets right. That like help us get to our net zero goals felt like a really awesome opportunity to go after. Mm-hmm. . Yeah. Yeah. And I'm
[00:11:39] James Dice: sure
[00:11:39] McGee Young: as, as you and I have talked about in the past, you learned a lot about how, you know, the traditional
[00:11:45] James Dice: methods of measuring and calculating energy savings are, are a bit flawed.
Um, Which we've discussed in this podcast that we won't fully get into. Uh, but I can only imagine you coming in from political science and even if you [00:12:00] understood regression and understood how it's done on that side, still coming in and like viewing it and going, Oh,
[00:12:08] McGee Young: you know, what's
[00:12:09] James Dice: ip mvp? What's this astray Standard 14?
And all of that is a deep, deep rabbit hole. Um, but you got bit by the book, it sounds
[00:12:19] McGee Young: like . Yeah. I mean, here's the thing is like, I think, I think there's a lot of people have really tried hard to think about how to measure energy savings, right? There's, there's sort of this sort of like bad rap, you know, that like, well all these people do it differently, but it's not because they're acting in bad faith.
Uh, it's because these are hard problems. There's no right answer, right? There's the counterfactual is. Just, you know, a sort of a hypothetical of like what would've happened and there's a lot of different, you know, considerations that you might, you know, bring to the table. And, and, [00:13:00] and as you look at a lot of different ways that, you know, a lot of different methodologies, you know, evaluation methodologies that are used, um, you know, every, it's really easy to pick apart flaws in a particular, you know, study or a particular approach.
And some of the flaws are, are kind of, um, you know, you can point to specific methodological choices. Others are the time lag that you get between, you know, when a, when a project happens and when we get around to evaluating it. But I think as a profession there's been, you know, just a lot of really good, thoughtful work, uh, that's gone in.
And as we approach this question of measuring carbon emissions from building. Um, meter data is actually not always the best way to do this. Um, you know, when we look at, for example, putting in a heat pump versus, you know, another natural gas furnace, you may not actually wanna use whole building meter data to assess the impact of the heat pump vis Avi, the gas furnace.
Um, and so some of, [00:14:00] some of the IPM VP family, you know, option B, option D, uh, might actually be, uh, a better way of assessing the particular impacts of a particular type of, or if you think about like plugging in your car, right? Is whole building meter data really the best way to, you know, tease out the carbon impacts of an electric vehicle?
Maybe not, right? And so I think we shouldn't be biased or have blinders on about like, there's only one right way to do things actually. Really appreciating the nuance and, and all of the different kinds of contributions to this work that the industry has, um, you know, developed so far. Give us the resources that we need today to actually be, um, really thoughtful about calculating the decarbonization impacts of different kinds of projects.
Totally. That was very diplomatic. Thank
[00:14:50] James Dice: you . Um, so, okay, so you were at recur. Um, can you talk about the, like why'd you jump ship [00:15:00] to go to, to start wat Carbon? Um, what's the problem you sort of set out to solve?
[00:15:05] McGee Young: Yeah, so once I, um, you know, we had, we had gotten, you know, Recurve is doing great by the way, and, and you know, it's a, it's a company that's, you know, solving some really important problems on the, you know, four utilities who are trying to deploy demand side energy programs in a scalable way.
Um, and once I left and you know, I was kind of, had time on my hands to, to, to think about things. One of the. I kept getting, you know, riled up about, I would read these stories about California's cap and trade system. Yeah. Where we've kind of established this like license to pollute for the big, for the utilities and the oil companies and, you know, the big industries in California and that, you know, cap kind of comes down every year and if you exceed the cap, you have to go buy offsets in the carbon market.
Mm-hmm. , which turn out to be, you know, trees and a forest somewhere [00:16:00] for the most part. And, uh, ProPublica did this really interesting, uh, study of what were being purchased for offsets and how they were being calculated. And it turned. That this is like, kind of like the funny part is that they're mostly using deemed savings to measure the carbon impact from the office that were purchased.
So they would, they would divide up California into climate zones and they say if your trees are in this climate zone, you get this amount of credit for it. Okay. Just like a deemed savings program for a utility program. And that we had been fighting against. I was like, so what ProPublica realized is that all of the carbon assets were coming at the very edge of the climate zone were the least amount of trees were for that particular, you know, for that, you know, that zone.
And so they were gaming the system. And, and, and then can
[00:16:53] James Dice: you explain real quick what deemed
[00:16:55] McGee Young: savings was? Oh, uh, yeah. So deemed savings, uh, [00:17:00] are typical of a utility program where you install, say like, Thermostat or some lights. And they don't bother measuring the, of those savings. They just give it a number and they say, Well, all thermostats are worth X amount.
Yeah. You know, this isn't true. Right. And so it leads people to game the system to, you know, do the least amount of work possible to get the biggest benefit, which is, you know, kind of human nature. And so the same thing is happening with trees that we were. You know, kind of claiming these carbon offsets in these very narrow SLIs of the, the zone where there like literally weren't any trees in some cases.
And then in other places they were burning down in forest fires. And so we had said, Well, for the next hundred years we won't cut down these trees. And so that justifies the emissions from last year. Mm-hmm. take one year's worth of emissions and spreading them out over the next a hundred years. And then we were burning down and then the trees were burning down, burning down.
[00:18:00] We still had the emissions and so we didn't have to go buy a new set of trees. Uh, we just said like, Oh, well I guess that didn't work. And, and I, and I was like, . And, and, and then, so I simultaneously, I had this thought where like, well, I had been doing this work on my house and I had put in solar panels, a heat pump, a battery.
I had my ev and I wondered to myself, How am I doing? You know, like I, I think that my carbon emissions are probably pretty good. Um, but how would I know if that were the case or not? And I started to dig into that and it turned out to be like, not an easy question to answer. So what do you use to answer that?
Um, the, for our energy efficiency calculations, uh, the avoided cost calculator, there's a G HG benefit as part of the avoided cost. And it's kind of the same, pretty much, you know, it's, it's a single number that you add, that you multiply by. And so like [00:19:00] no matter if I was saving energy in the middle of the day or at night, I got the same GQ benefit, right?
That seemed, that seemed wrong. Right? Using kind of typical, uh, g HG accounting methodologies, I would take my annual energy consumption and multiply it by the carbon emissions of my grid on an annual basis. Uh, well that seemed wrong. And, and I have solar panels that feed back. So do I count my net metered energy and, and plus if I'm using zero energy during the middle of the day and, and all of my energy at night when my car is charging, uh, does it matter that it's what time of day it is?
Nobody could really answer any of these questions. And so it, like we started putting the pieces of the puzzle together, right? Like, like there's actually, you can get the hourly carbon intensity of the grid in California. Um, which by the way is another, you know, kind of like, Oh wait, I can't go to my [00:20:00] pg e bill for this, Right?
CE doesn't tell me, you know what my emissions are. They tell me I'm a hundred percent clean energy cuz I signed up for the deep green. Mm-hmm. , It turns out that's a lie. Also, uh, they just buy wrecks, uh, from solar and wind farms. They don't actually match it up to my actual consumption. Uh, so. I'm not really a hundred percent clean in any like, true sense of that word, only on an annual basis.
So as we started looking at this at an hour by hour basis, so I realized that my own carbon emission footprint was double what it really should have been because, you know, from an annual basis I look pretty good, but I'm charging my car at night and my solar panels, when they feed back into the grid, are feeding back into an already pretty clean grid.
Got it. So how should I even think about my own emissions, much less how to reduce them and, and then when I reduce them, I thought, Oh my gosh, it's gonna cost me almost $2,000 per ton of [00:21:00] carbon that I saved by shifting my electricity use from nighttime when it's cheap to daytime when it's clean. That seems really backwards, you know, first of all, and and highly inefficient, right?
Could there be a better way for us to reduce carbon emissions by tackling like the low hanging fruit? And so that became kind of our thinking at, while carbon is like, first of all, I need better information to be able to actually make decisions about my carbon emissions. I need to know how to make these decision decisions, how to calculate my carbon emissions.
And then what should I do? What's the, you know, what are the best possible ways to reduce my emissions without spending ridiculous amounts of money to make very, you know, little progress? And so I think that became kind of like the, the formative thinking behind the company. Got it. Got,
[00:21:51] James Dice: yeah. I really, a year ago when you launched, you wrote this like, here's what we're out, out to do.
The way you [00:22:00] phrase it then was, the measurement of carbon and carbon savings is gonna be critical to our future. Um, and it got me thinking back then, and then, you know, it's been fun working with you as an advisor. Recently, but we're, we're in these, like the middle of these transitions, I feel like, in the industry.
And the way that you phrase it back then was, we're transitioning from energy management to carbon. So my entire career has been energy management, right? And there's a new paradigm that we're shifting towards with carbon. Um, there's a paradigm that I'm just like starting to understand, which is low cost accounting to high impact accounting, which is what you said in the post back then.
Um, which I wanna unpack and then this, this also transition. Third one, which you talked about just now with the Rex, is that the value of renewable energy is location and time dependent. So we can't just, you know, throw solar panels where they're [00:23:00] not necessarily needed. Um, so how much of that transition, like where do you think we're at in those three transitions?
Um, Are we just starting them or are we, you know, further towards the end of that, those transitions happening
[00:23:18] McGee Young: as, as far as, I hope that we're just starting them. Mm-hmm. , I think so too, because if, if, if this is, if we're getting towards the end, um, the future's pretty bleak, , so we've got a long way to go, I think on, on all three fronts.
Um, I would say that there's a lot of great progress being made, uh, that there's really, you know, a lot of, I'm borrowing my thinking from lots of others who have been developing these concepts and, and certainly we're not necessarily breaking, you know, new ground necessarily as, as much as, you know, trying to pull different pieces together from different, you know, mm-hmm.
parts of the industry that maybe haven't, The demand side and the supply side are a good [00:24:00] example of, you know, To, you know, intertwined parts of the energy space that don't ever really talk to each other all that much. Totally. We think about a dpp, um, you know, that's, it's hard for supply side energy folks to like even take that seriously.
Even as much as demand response has proven pivotal timing again, as it's, you know, under for 22, 22, it's considered a resource just like any other supply side resource. But there's still this kind of like, um, you know, bifurcation of thinking and approaches in the industry. In in emissions accounting.
It's similar. Um, you mentioned, you know, scope two emissions, which are the indirect emissions associated with the electricity you're using from the grid. Those are largely, um, you know, off, they're not, they're not considered offsets, but as a corporation that's trying to reduce its scope to emissions will almost entirely buy renewable energy certificates.
Rex, [00:25:00] uh, to lower, its, um, its scope to emissions, you know, exposure, but the accounting for that is more or less done independently of the carbon emissions associated with the grid that those Rex come from. So if I'm offsetting energy consumption that's happening, say in Colorado where you're at, that's a relatively dirty grid with wind Rex from Texas or solar res from California, uh, we're not really getting, you know, the same bang for our carbon buck as we might be imagining.
Um, also the time of day, right? So if I offset a hundred percent of my energy use, Entirely with solar wrecks. Um, all of my nighttime energy use that's coming from gas and coal, you know, base load isn't really being accounted for with that renewable energy purchase. So my carbon emissions are not actually zeroing out.
I think there's some really good work that's being done on the 24 7 carbon free energy front right now that's trying to address that, but so much. But that is [00:26:00] turned out to be pretty complicated, Right, To being able to procure the exact amount you need at every hour of the day. Then what do you do with those, with the solar in the middle of the day that nobody needs?
Does it go mm-hmm. procured. Exactly. You don't really shut your solar panels off, maybe batteries a little bit. So there's a lot of rethinking that has to get done, I think still. Um, yeah, as the intersection of the supply and demand. As we think about what does our renewable energy future look like?
Totally.
[00:26:27] James Dice: Let's talk about what you guys have built so far. So like you're like a year into this journey. One of the things I think is really cool about what you're doing is connecting that demand and supply side, like you said, which is connecting real time carbon emissions data from the grid to hourly energy data that the building is consuming.
Um,
[00:26:47] McGee Young: so can
[00:26:47] James Dice: you talk a little bit more about what you guys have dug into there and some of the interesting
[00:26:52] McGee Young: pieces of that? Yeah. You know, our experience on the, you know, measurement and verification side, you know, [00:27:00] suggested. Access to data is one of the main barriers. Uh, for any, you know, any company that's trying to wrap their heads around this, um, meter data is still too hard to get, you know, mission data and Michael Murray are doing great work to try to open up.
Uh, we, but I think I read somewhere as 98%. Uh, Michael just had a big, uh, a big release about, you know, still today it's way too hard to get hourly smart meter data out of most utilities that are already collecting it. Um, so we actually went in a little bit of a different direction, uh, where we started to build on the work that NRE is doing again, in your backyard there.
Um, some of our first work, uh, was, um, involved modeling. Solar and wind production where you, you weren't quite sure, you know, this was sort of future projects that were, you know, going to be developed. And we're trying to get a sense of the, you know, what, what the production profile would, what those would be or res that you were buying that didn't [00:28:00] have an hourly timestamp.
And you're trying to get a sense of like, well, my solar rec's coming from here in California. When is it producing? And can I kind of back myself into a rough calculation of when that, you know, when I, when I should be us, you know, how I should be attributing those wrecks to particular hours of the day.
And then in Rail released an in use load shape database, um, last fall that, um, provided calibrated load shapes for all sorts of buildings across the US commercial and residential. Uh, it's a huge file, It's like 16 terabytes. And, um, and so we, we kind of worked our way through that so that in a, you know, through the platform that we built, Any building anywhere in the United States could, we, could, we could calculate the, roughly the hourly energy, the hourly load profile for that building, and associate it with the hourly carbon emissions from the grid that it was connected to, to give [00:29:00] hourly carbon emissions, um, for any building in the US on demand, um, through the app, which was sort of like, you know, that was game changing for us, right?
Because that, that was like, Okay, we can do this. Then we built our connectors to real utility data, so like utility api. Um, so now we could provide this sort of like real time accounting, as it were, of carbon emissions from, from any building in the United States. And I think that was like the moment where we're like, Okay, we have something here.
This is really cool now. Mm-hmm. , what can we do with this ?
[00:29:31] James Dice: Yeah. Real quick, before you talk about that, can you talk about how most people get their emissions today? So if I'm. Um, x, y, Z building portfolio, and I have, I've added up on my annual kilowatt hours and terms for all my buildings, and now I need to take that and get to emissions.
Um, how do they most
[00:29:55] McGee Young: people do that today? It turns out that even that, like [00:30:00] annual accounting that you're talking about, there is aspirational for a lot of companies. Mm-hmm. . And so not even getting that. Um, but let's say you have an annual total kilowatt hour consumption and you're trying to calculate your scope to emissions, uh, you would go look at the EPA website.
Um, they've got a, a, a data file that's called ERI and E grid. Uh, we'll tell you, you know, here's, here's the annual emissions factor for this, You know, for this grid that you, that you're, you know, you're building is, is, um, drawing its synergy from. And so you would multiply that annual number by your annual consumption number, uh, which is mostly fine if you're in a place like Seattle that's got a hundred percent hydro.
And so, or a place like Kentucky , that's a hundred percent, uh, coal. But if you live in California where the carbon emissions intensity of the grid's gonna fluctuate quite a bit over the course of a day. Uh, when you're [00:31:00] using your electricity during the course of the day, really can impact your carbon, you know, footprint as it were in a pretty significant way.
There's been some research to suggest that even upwards of a 30% difference, uh, for an annual average versus hourly. And so the, the companies that are doing this now are kind of stuck in this like, not very helpful annual kind of construct, but the, the getting from that to hourly is like a bit of a leap.
Mm-hmm. , So there's like this, you know, kind of like bifurcation now between are you doing it the annual average way or are you doing it in a more kind of authentic way? Yeah. I was just at a
[00:31:37] James Dice: conference last week where a software company was
[00:31:39] McGee Young: sort of ragging
[00:31:41] James Dice: about the development they've done where they've, you know, added on all their dashboards and all their metrics.
They now have carbon metrics, and I was just thinking like, hmm. Wonder how that's being calculated? But one of the things that kind of turned the light bulb on for me is, My water heater project, which I think people, listener for the [00:32:00] podcast will have heard a lot about. Um, the short answer about my project is that it's not done yet, and it's because I, you know, kind of used your guys' tool when you released it and realized how dirty my grid is locally and realized that, hey, like it's actually in the near term not really that helpful for me to, you know, convert my water heater from natural gas to electric.
I don't need to rush this. I can probably just run to fail. And in the meantime, this is a decision that I made. In the meantime, the technology, the heat pump technologies improving that actually just came out with a um, hundred 20 volt, uh, ream hot water heater. So like I'm, I'm kind of watching the space progress as I kind of weight out my project and I'm just basically told my wife, Hey, it's actually not great emissions wise for us to do this right now.
It's, it's helpful a little bit, but not it's, it's not really that high of an impact. I'm gonna let the water heater run to fail and as long as it doesn't [00:33:00] leak when it fails, uh, my wife's okay with us not having hot water for a few days, but yeah, I use your guys' tool to say okay. It just gave me some insight into, Okay, what's gonna happen when I switched this load from gas to electric?
Yeah, that was super helpful.
[00:33:15] McGee Young: Um, and you might, you know, consider putting solar panels Yeah. Them already, because the Colorado grid is still so coal reliant. Yeah. That would be an investment there that would have a, a massive carbon impact versus, you know, my solar panels are basically like, You know, not, they're great, especially when the, the power goes out and, you know, we need, but like from a climate standpoint, like I might have been better off putting my money someplace else.
Yeah. To really, um, make, make it if I, if that's where I wanted to, to, to sort of prioritize was. Um, and then, you know, just to kind of pick up on that point just a little bit, it's not, some, some listeners might say, Oh, this is terrible. All heat, hot heat pumps are good heat pumps. And, and, [00:34:00] but the thing is, is like we, every single day in the United States, 20,000 heat pump water heater are, are gas fired water heaters and gas powered powered furnaces fail 20,000 a day.
And almost all of them are replaced with more gas powered. Versions of that. And so that's the problem to be solved, right? Because they're gonna lock in 20, 20 more years of CO2 emissions if they're replaced with, And so I think our thinking on this is like, let's go make sure that as these units are failing, they're being upgraded.
At that point with the electric, even if the grid's still dirty, kind of where they are, we can kind of forecast out, you know, especially because of the IRA work, we're gonna get a lot more renewables on the grid. It's an appreciating asset in that sense. And so we definitely need to be swapping them out for the electric versions today if they're at failure point.
Yeah, I think that's one of the most important
[00:34:58] James Dice: concepts in [00:35:00] decarbonization right now is committed emissions. Like what is gonna happen from the, the replacement decisions that we make tomorrow.
[00:35:07] McGee Young: You know what I mean? Yep. Um,
[00:35:10] James Dice: okay. Another piece that I, I think is cool about what you guys have been doing is the, um, Kind of, and you're gonna have to describe this a little bit more, but can you go deeper into how you get to Scope two emissions from a kilo one hour used at a certain hour in a building?
Cause I think this is really important for sort of unpacking what we're about to impact next, which is Rex and Offset and kind of where we go from here. Can you talk about kind of the, the technical work that you guys have done there?
[00:35:43] McGee Young: Yeah, so it's, um, it's both, you know, deceptively hard and deceptively simple at the same time to do Scope two, which is, you know, partly why everybody, here's the tricky thing with Scope too, is.
There's two different types of Scope two emissions. There's your [00:36:00] Scope two locational and Scope two market. So Scope two locational should simply be your energy use multiplied by the carbon intensity of the grid that you're connected to. Um, and so again, we talked about that on an annual basis versus an hourly basis.
Um, and then scope to market, uh, takes into account the contracted energy use energy that you've, um, that you, that you've, or the energy that you've contracted for. So if I buy a wreck or I've, um, committed to a ppa, or even if I opt for a green energy tariff, uh, within my utility, I can report that contracted, um, electricity as a, I can subtract it from my total electricity that I consume.
So that my scope two emissions only reflect the difference between my total consumption and what I've contracted [00:37:00] for from mm-hmm. these from these other instruments. Uh, it's confusing. Uh, when you, you look at, you know, I'm not really taking into account the time of day or the location necessarily of what those contracted instruments, right?
Mm-hmm. , so I'm buying a hundred percent solar. Um, I'm not really actually offsetting all of my electricity consumption and, and you know, and so it doesn't really take into account the actual carbonate. It's, again, some of this stuff represents like a good faith effort at the time in which these protocols were drafted, given the state of our technology, of our data infrastructure, we just didn't have the capability.
Mm-hmm. , now we're here in, you know, 2022. And I know that actually the WRI is actually starting to update its scope two, they've just hired somebody to update the Scope two emissions protocols. So this is work in progress, but, um, some of the, uh, [00:38:00] incongruencies in the reporting are a function of, um, just technology's getting better and our, our protocols are like, kind of like circuit 2010, you know, kinda, Yeah.
So, um, so what, what's interesting about this is that, um, if you start to think about this from an hourly standpoint, then you can optimize for carbon. And, and so if I, you know, right now the guidance in the scope to emissions to say you should try to procure your energy from the area in which you know, you're using your energy.
And that way it kind of like roughly nets to the grid that you're, you're part of. But maybe I wanna procure. Rex from, you know, Kentucky. And so, and I live here in California, so like if I bought Rex from Kentucky, that certainly solar power is gonna displace dirtier energy in Kentucky than it is in California.
And we can kind of keep track of this stuff on a vocational and an hourly basis. In the word, in the protocol terms, this is the [00:39:00] residual grid. What are you, what's already out there on the grid that you're, that you're interacting with? Um, same way that you might think about demand response as another way in which you could specifically target dirty times of the day contract.
Mm-hmm. contract for demand response, you know, during the OR or, Yeah. Or the clean fronts of the day. Right. So you use more energy when the grid is clean. Don't use as much energy when the grid is dirty. What if you created a wreck around that right around demand response. And so you were really targeting your purchase, as it were, of, of energy to coincide with reducing energy loads when the grid was dirty and increasing them when, when it's clean.
So I think there's a really interesting kind of story here around carbon accounting that as we have better data systems in place, um, and we're being more thoughtful about, you know, identifying particular times in which, you know, we might impact the grid one way or the other, um, that, uh, we could be more targeted and thoughtful in our approach.
[00:40:00] Totally love it. Um,
[00:40:03] James Dice: the third piece that I wanted to highlight about kind of what you guys have built in the last year is the data platform and sort of API strategy. So can you talk about sort of the data infrastructure here in a way that's kind of all we've been talking about so far, Right? Um, Can you talk about some of the use cases you're solving for today for some of these early customers and kind of where that could
[00:40:27] McGee Young: go in the future?
Yeah. We, you know, part of the, the work of doing a lot of this data, we call it data, data lunging. Uh, we have, you know, different data sources coming in. They're, they all have sort of problems with, you know, by themselves, right? Time zones are wonky or you're missing data, or you have outliers and. Every time you add a new data source into the mix, you have to sort of go through that whole process again of like [00:41:00] cleaning and then matching it up the right way to the other data that you're trying to get.
And, and in the world of buildings and energy, you know, you have sites that have multiple meters on them that might be sub metered. And so you're trying to, you know, create your hierarchy of, of relationships and then maybe single out, how much is my HVAC driving my carbon emissions, you know, from building or I've got a bunch of buildings in different places.
I'm trying to like put them all in together in a portfolio and this one's on this grid and this one's on that grid. And, and it just really quickly becomes a hot mess. But then throw up, throw on the Rex that I've purchased and, you know, other, like it's, it was really obvious early on that companies that have struggled even just to figure out.
Their energy bills , like there's this whole, you know, the preexisting condition here is like, we're having a hard time just managing our energy spend. And I'm gonna throw on this complexity of carbon accounting on top of it. Like, [00:42:00] forget about it. Right? But there's a last mile problem here, which is to say that like all of the guests on your show are solving, you know, for the most part, uh, they have a customer at the end of that who's, you know, not a grid carbon emissions expert who hasn't read the geg protocol, who doesn't even, you know, again, sort of barely understand their own energy spend and is now counting on this relationship that they have.
Yeah. To help them navigate this new world that we're in. We're no longer managing around energy, we're managing around carbon. So what does that mean? And so there are companies out there and individuals in these companies who are doing wonderful. Uh, to, um, to, to illuminate, you know, how carbon can, can impact investment decisions into buildings and, and all the rest who are engaging employees who are, you know, creating reporting infrastructure for, um, you know, for different, uh, regulatory frameworks, [00:43:00] but who, who aren't data scientists, who don't, aren't data engineers, uh, by training and, and don't wanna hire a staff of 8, 10, 12 data engineers and spend a year kind of building all the infrastructure you need to do this the right way.
So if as an industry we want to be serious about carbon accounting and drive, you know, carbon related outcomes, we have to have some sort of like way to actually wrap our heads around, you know, what's actually going. Creating an API around that, which is really just kind of pulling together a bunch of other APIs.
Um, but solving for all those kind of complicated data issues that always arise and slow down these, these, these, um, these initiatives so that out the gate you can provide carbon reporting to your clients. Uh, out the gate, you've got a new startup up and you're doing, you know, we've got one, we've got, um, a company that's doing employee engagement so that, you know, when they do emissions reductions at home, uh, then, um, the, the company rewards [00:44:00] them for that and the company can kind of claim some of those emission credits for themselves.
But like they need the data underneath all that Terry to make that work, right? And so they can just build on our API and we're building on, you know, Singularities API and utility API and, you know, all these other, um, kind of formative foundational pieces of our industry. To be able to unify carbon accounting in a way that makes it accessible to all those other companies that are doing this good work.
Yeah, and that was my first thought, like I
[00:44:27] James Dice: said last week at this conference I was at, is I feel that there are a ton of application providers out there and data layer providers that should be connecting into your api basically saying like, Okay, I have, I have energy data right now. If I wanna turn that into carbon and I do it myself, it's gonna be wrong.
I might as well, you know, provided in the most accurate way and kind of build on everything that you guys have already built. Um, can you talk about the importance of [00:45:00] transparency in these calculations? Because that's a, that's a sort of a, a tangent, but an important one to that conversation, which is, You could do it in a black box way, or you could do it in a way that says, I've covered all these different edge cases and I've done it in this way, and here's my math and here's how I calculate savings and that type of thing.
I, I know it's one of your sort of core values, so can you talk
[00:45:23] McGee Young: about that piece? Yeah. It, it became, um, you know, really evident when we were building the, the markets at, at Recurve, that if you weren't doing this in a, you know, transparent, reproducible, auditable way, that nobody would trust your numbers.
And because there's no right answer, right? So the question just became like, how did you get to the number? And can we all agree that it may not be perfect in all cases, but at least we know how you got it and this is the least wrong way to do it. Yeah, Yeah. And if you open it up to like, we got a lot of really great input from folks that improved how we, [00:46:00] you know, the development of Cal Track was a consensus process and as painful as that was, you know, like I owe a lot to Ken Agnew and you know, the people who have been doing this for, for 20 years, uh, who, you know, beat it into us that we needed to do things, you know, like better.
Um, so. With carbon accounting, it's, it's quite similar, right? There's, and there's unfortunately a lot of greenwashing that happens now with, you know, different ways of kind of accounting for emissions or emissions reductions. We saw this with the carbon offsets, you know, with the trees in California that didn't really exist.
Um, and if we're gonna, you know, be serious about decarbonizing buildings, then we should be transparent about the methods that we use, the data we use to come up with the numbers that, that, that we use. And, um, and so this goes, you know, up and down the full stack. So the first thing that I did when I started to work on this was I called up my friend Julie Goodman, who runs, who's [00:47:00] the executive director of LF Energy, which is the Linux Foundation's Energy Division.
And I said, Julie, I, I'm really interested in this, you know, carbon accounting, uh, work that's emerging and it's intersection with energy, but there's a lot of. Different claims that are being made around emissions. Most of it is like, and this is equal to a thousand trees, and, and, and it sort of like rings hollow, you know, like when you said, you know, like, okay.
Um, and so we actually put together, um, a working group, it's called the Carbon Data Specification Consortium that, um, it brought together, you know, Google and Microsoft and, and some of the software companies, some of the rec companies, um, both in Europe and, and the United States, um, to actually like work on a set of standards that we could use for the underlying emissions data from the grid so that we could all be talking about the same thing when we talked about this is what we mean when we say X, Y, and Z, you know, emissions.
But that goes all the way up to [00:48:00] stack. So if I'm going to be using that data, using building data, creating a counterfactual to, um, establish, you know, a savings benchmark for a project that's been done. All of that really needs to be done with an eye towards transparency, rep, replicability, auditability, so that it can have the credibility it needs to be used, you know, to actually make decisions around optimizing for carbon.
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[00:49:07] McGee Young: So I, yeah, I
[00:49:08] James Dice: totally agree. Let's switch gears a a little bit, um, and talk about kind of this new direction, I'd say new direction. It's really what you're building on top of the data platform. So
[00:49:20] McGee Young: it sounds like the
[00:49:20] James Dice: API is able to be used by anyone that wants to sort of piggyback on the work you guys have done, but you're also headed towards building this marketplace.
Um, can you talk about kind of why you feel like a marketplace is needed and kind of the thinking
[00:49:36] McGee Young: behind that? Yeah. Plant heat pumps, not trees.
Uh, I mean, this kind of goes back to the origin story, right? Like we, we, we've we're spending billions of dollars a year on, on nature based assets. And a lot of those are really great projects that do, you know, some, some amazing work, [00:50:00] really novel technologies being developed to capture con, you know, carbon and put it in the concrete or to, um, you know, take corn cobs and turn 'em into oil and pump it down into the ground.
And, and, and frankly, like not cutting down trees is, is a pretty good, pretty good plan, uh, for us. But it's not really the root of the problem. The problem isn't that we have is isn't that we cut down too many trees, is that we're continuing to emit, you know, millions and billions of tons of, of CO2 every year.
And unless we stop doing that, it, we can't plant enough trees, uh, to, um, you know, to get us out of the problem. And so we have to decarbonize buildings that's, you know, 30, 35% give or take of our emissions. But going back to your heat pump, your hot water heater 20,000 times a day, the guy shows up at your door when your water heater breaks or your furnace breaks and brings the natural gas version with him on.
Yeah, that's what he is. Gotten the truck. [00:51:00] And you as the like, thoughtful, you know, you're gonna push back and say, No, I want the, the, you know, the electric version. And he's gonna say, No, no, no, no, you don't want that. You know, it like breaks down or like whatever, because it's a pain in the butt to install and it's, it's, you know, the profit margin goes way down.
He's gotta train his guys on how to do this. Um, there's so many barriers to actually doing the environmentally correct thing, and the only way that we have to justify it right now is either our conscience. Or the bill savings. And the bill savings aren't really there for the most part. And like, not my, not in my case.
Yeah. And our conscience is good, but it's like, not gonna, doesn't scale. Yeah. Uh, so how could we think about maybe then taking this idea of, okay, like let's spend money to get an environmentally beneficial outcome. Like not cutting down trees, but think about that. But buildings as a source of our [00:52:00] offsets.
So could I buy the environmental benefits of putting in an electric, you know, heat pump ahead of time so that when the guy came to your door, he said, James, I got this great deal on this, you know, high efficiency heat pump, water heater, and it's not gonna cost you anything out of pocket. And, um, you know, and it's great for you and your family and Oh, and, and you're like, Oh my gosh, this is so great.
Because your plumber is getting paid on the back end for the environmental benefits associated with the project that he has now sold you. Right? And if we could do that at scale, if we could invest in buildings for their decarbonization potential and use the offset money that's now going to fund, you know, pre preservation instead to fund building decarbonization, we can both achieve the principles of offsets in the first place, which is to kind of keep us in balance, but also be driving permanent and, [00:53:00] um, and, and actually transformative decarbonization projects in our buildings and homes.
I
[00:53:06] James Dice: love this. Um, I want that plumber to show up in my house like tomorrow. I'd love that. Um, let's do this. Let's build this thing. Um, Connect that vision of my house and my future plumber. Connect that to say the biggest reach in the industry, in the office industry or whatever. Connect that to those guys who are out there buying extremely cheap offsets today.
And maybe they have a future, um, goal in the future of being, you know, not buying any offset's, being totally net zero at some point in the future. So they're looking at this, you know, portfolio and saying, we have to get to this future point. How can this idea sort of help them
[00:53:54] McGee Young: along their, their roadmap?
I think there's a, there's a [00:54:00] just an amazing potential here. Um, so, so first of all, if I'm a, you know, property owner of any, any sort, I, like, I think about my own house, it, it's gonna cost me $1,800 a ton. CO2 to, to kind of reduce my carbon footprint. I'd much rather go, you know, instead of that spend, you know, say $200 a ton to help fund heat pump projects, you know, in Fresno say mm-hmm.
right. So there's, um, already sort of an allocation of resources here that we can be a lot more thoughtful about. Um, and so, and if I'm buying, um, you know, carbon offsets that are, you know, maybe like really cheap right now, um, maybe that's a sign that you're not really, you know, moving the needle, that this is greenwashing and, and not really the where, where, where you want, you know?
Do you want to end up on John Oliver? Is the question that a lot of carbon offset buyers are asking themselves right now? Um, but what's I think is really exciting about this. There's so of all of the things that I [00:55:00] think kind of for a re to think about, um, what if we started to think about these investments into buildings themselves as PPAs.
We would buy a PPA for, you know, a big solar facility, but, but distribute them. And, and so I'm buying the cash flow of, of a, of your heat pump project. For example, you're gonna pay me back over the next, you know, five or 10 years or so for the cost of that. But in, in exchange for that, you also give, I own the environmental rights to that project.
And so now the offset, as it were, comes with the cash flow associated with the heat pump project that we just financed. And what if we remade the, the capital stack for buildings around the impact of on carbon emissions that projects would have in those buildings. So I could make a fortune as a reit decarbonizing buildings.
This, this, you know, this is a world that I wanna live in, [00:56:00] right? Where, where now we have opened up, uh, unlocked new pathways to allocate capital that result in envir in fundamentally transformative environmental improvements based in the built environment. That's where we see kind of the big opportunity for like institutional investors to think about how do I make money and at the same time, decarbonize the buildings that I'm both responsible for directly as well as potentially in my community that, that, that could use those extra resources being invested in them.
So re
[00:56:30] James Dice: could or re could eventually say, I'm gonna put this, allocate this money to decarbonize my own buildings and then reap the rewards financially of that. Or they could say, I'm gonna take that money and find it, uh, a higher impact home elsewhere that decarbonize other people's buildings. Mm-hmm. . And what you wanna build is the marketplace where those decisions and those transactions can be
[00:56:53] McGee Young: made precisely, precisely.
So I, I think
[00:56:58] James Dice: one piece of this that I'd like to [00:57:00] get your take on is going back to John Oliver, where it's kind of, I think people, you know, maybe a couple years ago were, were saying, we're just gonna go buy offsets and we're gonna be carbon neutral. And I think that has gotten to a point even before John Oliver special, which we'll, we'll link to in the show notes, show notes, um, even before that was published, obviously people in our industry had soured on offsets.
It's kind of viewed as like a transition that I'm gonna put in my marketing materials until I can get a better idea about what to do in the future. So I think people agree, like, they're probably not good, but like, how, in your mind, can we make them good in this, in this future vision that you have?
[00:57:50] McGee Young: I, I think about, um, I was on the phone with a, with a.
A company that's managing, managing some buildings that have, um, [00:58:00] highly sensitive materials in them and, and they, you know, they don't really wanna mess around today with today's technology, um, with other ways of keeping that building cool. Of keeping the air circulating because of the sensitivity of the materials inside that building.
Yeah. Mm-hmm. . Um, now we can quantify exactly the environmental impact so that that choice that we're making, right. Um, on keeping, and it may be worth it, right? It may be worth burning natural gas or whatever to keep the, the stuff that's in that building from, you know, approaching the environment or, or whatever it is that it might be.
But it doesn't mean that we have to sort of ignore that. We could take that and we could offset that impact that we, that we sort of are okay with having, uh, with. A reduced impact someplace else. So if I put a, a heat pump into your house and to a thousand other houses, that might equal the impact that [00:59:00] that building is, is having now, that building's gonna keep having that impact every year.
So we're gonna have to find more and more heat pumps, you know, to put into buildings year after year that will have permanent reductions in emissions forever, because we're probably not gonna go back to not heat pumps, you know, um, once, once the useful life of yours is up. And so actually we think about this as a tradeoff between there are some uses of fossil fuels that we're going to be okay with.
And if instead of trying to mitigate that by saying, Well, let's not cut down a tree and then it'll absorb the CO2 that's emitted, let's actually use that to make an investment into actual decarbonization. We end up having a much, actually, it's like a transformative effect. And if we did it today, like what if every single organization on the planet today committed to net zero today and, and spent all of the money that would be required to like, you know, eliminate their emissions [01:00:00] impact today on decarbonization, they just said, Will, like, we're just gonna put all of the money now into decarbonization.
The transformative effect globally would be like something we couldn't even contemplate. Right? And, and for sure we're gonna have to like, cut down on some of those. We're gonna have to eventually, you know, drill and, and burn less oil and we're gonna have to stop, you know, burning coal. But in the interim, there's so much that we can do to clean up our environment to trans, to transition to more sustainable systems.
The amount of capital that we could harness right away through assets might just be what we need to make it to, you know, to next year and to the year after, to keep hitting those interim goals on the way to a sustainable planet. Totally. Talk to me a little bit about, a bit about cost. So,
[01:00:48] James Dice: um, I had someone tell me that they're last week, that they're buying offsets for $8 a ton or something like that.
Where is that number? If it were high [01:01:00] quality decarbonizing a, a building, where should that number be at? In other words, what I'm getting at is like, how can we get people to understand the cost increase to go from greenwashing offsets? Uh, which I have a feeling that that $8 per ton number is probably in that category, but like, what's the high, Like what should people be spending on offsets that gets them actual decarbonization in your mind?
How does that even calculation to get to cost? What are the
[01:01:32] McGee Young: factors there? Yeah. I think about when I was in college and we lived off of, uh, 25 cents a package. Ramen noodle is soup, right? Yep. That you can feed yourself with that. Sure. Amazingly, you know, like sustained ourselves on, on that for a shockingly long time.
Probably not the best longer term strategy for Yeah. Help. Um, that's
[01:01:58] James Dice: like Yvonne [01:02:00] Ard, the CEO of Patagonia, he lived off of, uh, dented cat food cans when he was a dirtbag in Yosemite
[01:02:09] McGee Young: a long time ago. Yeah. Right. Again, doable but not maybe sustainable. , uh, the, the social cost of carbon has been recently reactivated to be somewhere in the neighborhood of $150 per ton.
Okay. Um, that, you know, strikes me as a more realistic, uh, figure. But the thing about it decarbonization is that it's not cheap. Right. Like it costs a lot of money to put in, you know, heat pumps and solar panels. And, and even if, you know, the, the longer, if you can make the investment and have a longer term, you know, roi, that that pencils out.
It's still a cost of capital. And, and these are. And I think that we're fooling ourselves if we think that, you know, $8 a ton is gonna get us very far with actual decarbonizing buildings. We have this, you know, avoided [01:03:00] cost concept in the energy space. You know, for a utility in order for it to make sense for a utility program has to like pass the avoided cost test.
But that's a very different test than the achieve our policy goals test. And so when we think about decarbonization, we should be thinking about the cost in terms of like, what's it actually going to take to be able to decarbonize buildings. And it's probably gonna be closer to that $150 per ton than the $8 a time.
Now if you want it for cheap, then you just buy the whole project and have, you know, take on the risk of that repayment over time and there'll be some bill savings, There'll be some other ways in which you can make those, those numbers pencil out. Um, but you know, it's kinda like in the world of software development.
There's good, there's cheap and there's fast, but you can only pick two. And, and so in the world of, of carbon offset, if you're, if you're anchoring. On, uh, on cheap, uh, you're probably sacrificing, you know, in on one of those other areas. Absolutely. Okay. So you guys are planning on building out this marketplace where
[01:03:59] James Dice: [01:04:00] the supply side is people that are doing out there, you know, contractors or developers that are out there doing decarbonization projects like the plumber that's gonna install my water heater like that, that's
[01:04:13] McGee Young: the supply side.
Um, the buyer side is
[01:04:16] James Dice: like, um, the organizations that are looking to, you know, get rid of their carbon emissions. Right? So can you gimme some examples of more examples of the supply side? Cause we've been talking about heat pumps this whole time. What else might this marketplace be filled up with? All the different ways in which, uh, car decarbonization in buildings can
[01:04:39] McGee Young: happen?
One of my kind of motivators for thinking about this was I saw this incredible transition in the marketing materials of all of the companies that show up at like re plus or, you know, the other like energy companies that are, have now rebranded to become decarbonization companies. Mm-hmm. . Yeah. And, um, I was sort of like annoyed [01:05:00] by it at first because it felt like just opportunism.
Like they're doing the same thing they did last year, you know, but now it's called decarbonization. But the reality is, is that they are decarbonizing buildings. Um, the work that we've been doing for 20 years is the right work to be doing. We just don't have a metric to measure ourselves against and a way to value that, that work.
And so, um, you know, there's an important aspect of this in the world of offsets. Um, the, the term is additionality. And what, you know, offset purchases get dinged for. And where, you know, in the world of, of energy, this happens with Rex a lot, is that you have a, a wreck is generated every time a megawatt hour of energy is produced.
But that, you know, say the solar farm that is coming from might have been built 10 years ago. Mm-hmm. , if you buy a wreck from a solar farm that was built 10 years ago, like really, how much of an impact are you having? Right, Right. So, additionality requires us to raise the bar a little bit and to say, uh, you know, we're gonna [01:06:00] be funding projects that that haven't happened yet, and we're gonna be using the funding specifically to.
Turn buyers or turn, you know, the end customer from a no to a yes, right? Where they, they wouldn't have done the environmentally good thing before, but now there's the offset there to kind of juice the pu a little bit. And so now we're gonna get to, yes. And so you do that through a contractor whose job it is, is to get you to say yes at the lowest possible and keep as much money in his pocket for himself as he possibly can, uh, by their very, you know, like not nothing wrong with it, right?
Like this is actually like a good thing because that means that the offset dollars go to build that contractor's business as much as it does to, um, support projects. That would've happened anyway, right? If you were gonna, if he came to your house, none of that rebate money would actually get a go to you because he, he'd look around and see all the books on your walls and like, and he like, You're just gonna pay full freight for this cuz I know you're gonna, I'm not passing the savings on to you.
[01:07:00] Exactly. Whereas, you know, your neighbor, uh, you know, Takes a look at the big truck in the driveway and the American flag or whatever, and, and goes, I'm gonna need to actually, you know, kind of entice you with some extra, you know, the berry gold water sticker on the bumper. Um, and so that's the, that's the way in which, you know, we wanna make sure the market doesn't just.
Um, reinforce decisions that were already going to be made, right? We're not just subsidizing the rich as we're, in fact, we're targeting those really hard to reach customers who need that extra incentive through their contractors, but then use your imagination a little. And you have, you know, solar contractors going out and putting solar panels on, on homes, heat pumps, electrification generally is a, is a really great, Um, but energy efficiency also, you know, delivers carbon savings, demand response.
So we're putting in batteries, you know, smart thermostats in commercial buildings. All of the controls and lighting systems can now be [01:08:00] optimized for a carbon signal. Um, and not just, um, an energy, you know, energy arbitrage signal or, or, you know, lowering your bills. Uh, and so, you know, we're really excited.
You know, we've been meeting. Dozens of companies, you know, in the last, you know, month or so as we've been working on this, who I've actually been quite surprised by the diversity of mm-hmm. ingenuity that's, that's already out there in terms of like clever ways of thinking about how to get projects into buildings that result in real carbon emissions.
And I'm actually kind of excited to be able to showcase more and more of them that people don't really realize that the, the good work that's getting done already and to be able to drive more revenue into them for the environmental benefits that they're delivering feels like a win-win altogether.
Totally. And then not only ensure for
[01:08:47] James Dice: an additionality, but like you said earlier, ensure for, um, ensure that
[01:08:52] McGee Young: that energy that's
[01:08:53] James Dice: being pumped into the grid or lack of energy that's being, um, consumed is matched with [01:09:00] location, location emissions. Right. And the temporal, or as you say it, the, the time of day that the emissions are happening.
So the ability to then match. That project with what your data platform is calculating as the carbon emissions is the
[01:09:15] McGee Young: key. Yeah, it totally, And, and you know, the fun, the real work is really interesting within the platform is that, We can pull in the data from the buyers themselves, right? So you're, you know, say Walmart, you load in all of the, you know, energy use data on an hourly basis from all of your buildings across the country.
All of the Rex that you've purchased, all the PPAs that you've purchased, and now you have new portfolios of carbon offset projects that are, have the same hourly locational accounting as all of your buildings. And so it looks like just another way to manage your energy spend and your carbon spend, but with buildings that are, that are with projects that are [01:10:00] happening in your communities.
And it's a little bit of a different story to tell as an organization about not only do we care about our own emissions, our own footprint, but we're really deeply invested in, you know, our communities and, um, the health and wellbeing. And, and, and honestly as, as energy prices continue to increase, there's a financial component to this.
There's a lot of the companies, you know, that we talk to on the buy. You know, we're talking to their ESG group and we tend to focus a lot on the e the environment, which we're synonymous with energy in, in a lot of ways. But the s is actually like, present, you know, and a lot of these conversations and, and we think about, you know, as energy prices go up, people like you and me, James, we're gonna put in our solar panels, we're gonna optimize, you know, low.
We're gonna have the wherewithal to be able to lower our bills. There are quite a few, you know, renters, uh, you know, low income, uh, households in general who are gonna be left behind and who are gonna be, you know, [01:11:00] facing higher and higher bills and increasingly difficult to try to transition because of the overall scarcity of, you know, it's, it's gonna be hard to get a contractor.
I have a hard time getting a contractor to show up to my house and I. Full afraid, and I, you know, know I'm doing, and a modern house, like to get access, you know, into some of those other communities is, is really gonna be a challenge. And so companies that have a strong, you know, e and s, um, uh, a social dimension to the thinking, they're thinking about buying assets, um, I think are gonna be really well positioned to be able to tell a powerful story about how those assets they're purchasing from their community are having, uh, multiple sets of effects, um, positive effects from, from those investments.
Love it. So you build up the
[01:11:46] James Dice: data platform, you're headed towards, blooming out this marketplace where, talk to me about 10 years from now where the company's gonna be
[01:11:54] McGee Young: as you look forward. Yeah, we're, uh, you know, as a startup [01:12:00] you always have to take it one day at a time and, you know, focus on the next thing.
But, uh, in, in 10 years, you know, most of our. Midterm net zero goals will have been not met. And, um, you know, as we think today, we have still a little bit of luxury. Um, you know, it's not that hot in the summertime. The storms aren't that bad. We're about to see a huge hurricane hit Florida. Uh, we saw a summer of, of, you know, climate catastrophe, you know, across the planet.
This is the, the mildest weather year we'll have for the rest of our life. So in 10 years, it's going to be, you know, all that more critical that we're able to really smartly deliver decarbonization solutions, not just in the United States, but globally. And so our, you know, obviously we want to be able to focus on the things that we can focus on today, which typically has a US [01:13:00] focus.
But I'm really excited about like, how do we decarbonize Mexico City or, you know, Logos or, you know, Bangkok or, you know, like there's, you know, there, the, the, the challenge ahead of us is, is almost, it's almost overwhelming in a way, but if we can start to leverage capital in a smart, thoughtful way, I think we can have an impact that goes far beyond our own borders to be able to improve the lives of the, you know, billions of people who are gonna be really affected by climate change over the next decade.
Love it. I'm excited
[01:13:36] James Dice: about this. Um, let's close with some carve-outs. Uh, I'd love to hear something that you would think people should, uh, check out these days. Book, podcast, TV show. I know you don't listen to podcast, movies, documentaries, et cetera. What, what should, what should we point people towards?
[01:13:55] McGee Young: Uh, geez.
Well, my, my one. Is NBA [01:14:00] basketball. Uh, so I'm, I'm really excited for it, for the, for the upcoming season to see if the, the doves repeat uhhuh. You guys, you guys have a good team in Denver there. So that will be, uh, an interesting, I think right now I like to watch, if I watch tv, I, I love kind of entrepreneurial themes.
Um, Breaking bad, for example, you know, is a good, uh, I, I'm watching, uh, Narcos Mexico right now. Okay. Which is the story of the Mexican drug cartel. It builds on the first narcos, which was the story of the, um, Columbian drug cartel. But the Mexican drug cartel is a fascinating look at, you know, the mid eighties, the, you know, transition from kind of like, local, marijuana, you know, what do they call just these local distributed organizations that are trying to sell weed to American kids, and all of a sudden they, you know, they get.
And it's, it's a, it's a founder story, right? This guy gonna talk about like [01:15:00] scale, right? These guys, you know, scaled to, to billions of dollars in revenue in just a few years, they diversified to cocaine and started working with the Columbian. And it's a, it's a classic entrepreneurial tale with, you know, like some, it's like more interesting in a lot of ways than the kind of stuff that we work on, right?
And the stakes are a little higher, so there's a lot of murder and, and uh, you know, the guys like definitely stressed out, right? So I feel helps me feel like, okay, my job's not that stressful. At least I don't have like all these people trying to kill me on the daily basis. Yeah, you're not on the other side at the law.
Totally. Highly recommend Narcos, Mexico if anybody's into entrepreneurial TV shows. I love it. I love it. Um,
[01:15:42] James Dice: okay, so mine, I'm gonna share a couple. Um, one is I read, uh, one to 10. It's a book by, uh, former podcast Guest Rags Gupta. Um, the premise is one of my favorite books is Zero to One, Written by Peter Teal.
You've probably read it as well. [01:16:00] But Rags took it and said, Okay, well what if you're at one? You have customers, you have product market fit, like how do you get to 10? Um, and he's done it a couple times and it was just fun to read it. I read it on the plane to Boston last week, and then I had dinner with Rags when I got there.
So it was like this amazing, uh, uh, kind of full circle moment for me as the, you know, the founder of this fun community. Um, another one is, I, I, you probably would enjoy this book, which is why I wanted to share it with you. Um, I read it over the weekend. It's called Training for the Uphill Athlete. And when they say Uphill Athlete, they're talking about, um, cyclists like you, trail runners like me, um, ski mountaineers, like any money that does a lot with their quads to, to gain elevation basically.
Um, and it's just like a deep dive into. Uh, biochemistry on how our muscles use energy and how to like, build and [01:17:00] maintain and sustain endurance. And I just, I found it fascinating. I couldn't put it down all week, and I like, have a new sort of roadmap for my running after reading it. So if anyone's like me that likes to nerd out on that kind of thing, definitely check that out.
Um, well, thanks McGee. Uh, I'd love, love to dive into this. You've taught me a lot with sort of understanding what you're building. Um, I'm so glad to share it with everybody else.
[01:17:27] McGee Young: Yeah, thanks for having me on. Uh, it's, it's still fun and, and, uh, even though I've, I don't listen to your show. I, I read the transcripts, uh, so I'm, I'm a big fan of the transcripts of your shows.
Well,
[01:17:39] James Dice: we'll have to do a better job of editing them for you than I know that I, I don't know very many people
[01:17:46] McGee Young: that just
[01:17:46] James Dice: listen to transcripts. So, um, if that's you out there listeners, uh, I guess. That would be hard for them to hear this.
[01:17:54] McGee Young: If someone's reading without reading this on the transcript transcript, they're still with us.
This is [01:18:00] for you. This is
[01:18:01] James Dice: for you. Yeah. Um, but let me know because we could probably spend more time cleaning them up, uh, because machine learning is not a hundred percent accurate at this point yet. Um, anyway, thanks so
[01:18:13] McGee Young: much. Talk to you soon. All right. Thank you.
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