WHEN: Today, Tuesday, March 8, 2022
WHERE: CNBC’s “Closing Bell”
Following is the unofficial transcript of a CNBC exclusive interview with United States Energy Secretary Jennifer Granholm on CNBC’s “Closing Bell” (M-F, 3PM-5PM ET) today, Tuesday, March 8th. Following is a link to video on CNBC.com:
All references must be sourced to CNBC.
SARA EISEN: Joining us now for a CNBC exclusive interview is US Energy Secretary Jennifer Granholm. It’s great to have you Secretary Granholm from the CERAWeek conference in Houston. Nice to see you.
JENNIFER GRANHOLM: Thank you. Glad to be on.
EISEN: My question is about the impact because the US isn’t a major importer of energy from Russia say like the Europeans our friends there did not ban oil because they’re too dependent on it so how much of an impact do you think it will ultimately have in terms of hurting Putin?
GRANHOLM: Well, first of all, I think it’s really important that we not finance Putin’s war and I think that’s why so many people in America have felt that way too. Surveys have shown over the past few days that up to 70% of Americans agree that they are willing to even sacrifice themselves by paying more at the pump in order to not fund that war. If you combine this, of course with the sanctions that have already been collectively announced against Putin, these are extremely damaging. Now, let me just say that we know that the United States is in a privileged position in this way because we have, we don’t rely that much on Russian oil and we don’t rely on Russian gas at all. We know that our allies across the world may not be in that same position and so we are not asking them to do the same thing. But for us, for our nation for our citizens, this is an important statement.
EISEN: Should we not be boosting energy production right now in this country to meet demand both domestically and in places like Europe?
GRANHOLM: We should be boosting all around the world and in the United States, and we should be investing in moving toward clean energy as well. That’s what our message is here at CERAWeek, we want to see increased supply. We want to see it in the United States to the extent that the industry can do that. We want to see us move as well toward solutions that don’t have us relying on fossil fuels from countries that do not have our interests at heart. We have to do both, and we have to accelerate.
EISEN: How much are you willing to do on that front? Because there’s been a lot of criticism for this administration in particular for being tough on oil companies and limiting production, not allowing the federal leases on, on federal land, not allowing the Keystone Pipeline to go through. Is there some regret and potential change?
GRANHOLM: There is nothing that would have increased production. If the Keystone Pipeline had been approved, it wouldn’t have even been built by now so that is just a talking point. There is this administration under this administration, oil is almost at record production. By the end of this year, it will be at record production. Natural gas is at record production, liquefied natural gas is at record production, every molecule that we can liquefy, we are exporting in terms of natural gas if there is a facility to liquefy it. There are six, excuse me, 9,000 permits that have been issued that are not being taken advantage of and I say that to encourage the oil and gas sector to take advantage of the permits that they have. There are 20 million acres of public lands that are under lease right now by the oil and gas industry that are not being used that are not being produced on and remember that 90% of oil drilling is on private lands and not public lands. So this is not about that, those are talking points. What we want to do is to say we are in an emergency, we have to increase supply so that we cannot, so we can make sure that people are protected at the pump and we have to move to clean energy solutions with great accelerating both right now. But clean is in the end where we should be so that we don’t find ourselves in this position again.
MICHAEL SANTOLI: Secretary Granholm given that it is an emergency and given that you’re trying to access supplies everywhere and you mentioned you don’t want to be financing Putin, is the administration any closer to trying to encourage production by other countries to fill in some of these gaps? And I guess a similar point, would you look to try and close off revenue from the sale of Russian energy products to other, to other customers, to other countries at this point?
GRANHOLM: Yeah, I mean, as I say, the other other countries are in a different position. Because we do not rely so much upon Russian oil and we don’t, we don’t import Russian gas at all-natural gas, we don’t import coal, we are in a different position. And that’s good for us, but we want to make sure that we are not putting pressure on countries who simply cannot, cannot survive without access to those resources but who are themselves for example, our European allies had just announced a plan to accelerate their movement toward clean and to your first question, we are calling upon all producers across the globe to increase supply. We’ve got to make up for eight and a half million, million barrels of Russian oil that could potentially come off. That’s what, that’s what they export. And so we need to make up for that so we want to encourage producers around the globe including in the United States.
EISEN: There’s no quick fix, as you know, Secretary Granholm and $4.17 is the price for the average, price per gallon of gas for regular gasoline in this country right now. How high do you expect it to go and how long will that last?
GRANHOLM: It’s, that’s, that’s the question. We don’t know. Of course, we don’t know how long Putin is going to terrorize Ukraine. We do not know how long his war will last. But let’s be clear, these increases are, are because of Vladimir Putin. This is Putin’s war, these are Putin’s increases and we cannot allow it to stand so it may take a bit. And this sacrifice, we are fortunate that we are not being asked to sacrifice our sons and daughters to go and fight this war. But we may have to take on other sacrifices and it makes me so proud that so many Americans are willing to pay a little bit more at the pump in order to accelerate the end of this war.
SANTOLI: There have been calls for additional reserve releases globally, international reserves that countries have control of. Is that something that’s an active discussion?
GRANHOLM: Yes.
SANTOLI: It is, and do you have a sense of when there might come to be a decision on that?
GRANHOLM: Yeah, I think there’s a sense of urgency about this. We are in active discussions with our allies. As you know, we just did a release of 60 million barrels collectively as a collective action with the International Energy Agency last week. And we will be having further discussions both internally to the US but also with our allies.
EISEN: There’s also some concern that that in an effort to boost the production of oil globally that the US is maybe being friendlier than it would ordinarily to places like Iran, Venezuela to try to fill the gaps in oil that are not our friends. Can you address some of those concerns?
GRANHOLM: Well, I know that the Biden administration has conversations with our, with allies and adversaries all the time. I know that we are looking to create partnerships with countries that may be unusual in the broader spectrum of energy including energy technologies. I’ve been meeting with folks here at CERAWeek who are from all manner of countries who also want to be part of the solution in the move toward clean energy and decarbonized, decarbonize fossil fuels. So, there are a series of discussions happening around the world and that’s all I can say about that.
EISEN: But is it your expectation that the Iranian barrels do come back online if there is a deal here on the nuclear agreement soon?
GRANHOLM: That’s certainly something that is a possibility. But of course, you have to get to the deal first and the deal the fundamental the reason for the deal, is a denuclearized Iran. That’s the reason for the deal. If there is a byproduct of increased supply, so be it, but that the deal is all about making sure the world is safer because Iran doesn’t have a nuclear weapon.
SANTOLI: And Secretary Granholm, can you give us a sense of just other things being explored I’m sure it’s pretty much everything but whether it be trying to ease petroleum taxes or something else that you’re looking at in terms of potential short-term leverage to pull?
GRANHOLM: Yeah, there, I mean as I mentioned, the release from the Strategic Petroleum Reserve is one thing. There’s a whole array of ideas that are being kicked around. I’m not going to talk about them. I’ll let the Biden administration release that when that when it’s ready, but suffice it to say, there’s a lot that’s on the table.
EISEN: And finally, Secretary Granholm, you said that the timeframe on these elevated prices depends on Putin and the war. What is the off ramp for these energy sanctions?
GRANHOLM: Well, you know, this is a very fluid situation, we do not know what is the next shoe to drop in this war against Ukraine. So we are taking this one day at a time. Clearly, we don’t want to see people hurting at the pump for a long period of time, which is why we’re looking at increasing production and that’s really the most important thing to do. Ultimately, it’s difficult to imagine flipping a switch and seeing those barrels, those Russian barrels come online and be acceptable around the world given the egregious activities of Vladimir Putin. So, this is why increasing production and really increasing clean energy, transitioning to clean energy are the solutions for, for being able to reduce those prices at the pump.
EISEN: But doesn’t clean energy just raise oil prices even more? Because we’re still dependent very heavily on fossil fuels and it’s very expensive to get there.
GRANHOLM: It is not expensive. Clean energy is the cheapest form of energy, wind and solar are the cheapest forms of energy. So no, it does not in fact, if you drive an electric vehicle, not that everybody can afford one, but just if there were a transition to an electric vehicle and you filled up today at the pump with your vehicle, it would cost you maybe between $50 and $60 to fill it up. If you charged it at home, it would cost you maybe $12 to fill it up. So no, clean energy is abundant. It is cheap, it is accessible and the prices continue to drop. And that’s why it’s very important for us to continue to press there are new technologies that make energy even more abundant and dispatchable and base like baseload power, those may not be quite ready yet but certainly on the renewable side, it is ready to go.
EISEN: Now I ask because even Elon Musk is advocating for increasing energy production, which is very unlikely source as he is the king of making EVs.
GRANHOLM: I think everybody recognizes that we have to increase supply right now because we are in an emergency at the same time as we need to move toward clean.
EISEN: Secretary Jennifer Granholm, thank you very much. An important day to have you. We appreciate the time.
GRANHOLM: Thank you.
