T. Boone Pickens' Roadmap for Green Entrepreneurs
T. Boone Pickens' Roadmap for Green Entrepreneurs
[Editor's note: This article is the first in our Eco-Leadership series, a regular feature with Anna Clark talking to the leading lights of green business to find tips, strategies and success stories for making green work for you. More interviews will be posted soon, and you can find them all at GreenBiz.com/eco-leadership.]
T. Boone Pickens' office in Dallas is 15 minutes from my front door, but our lives are worlds apart. He is a billionaire energy magnate with a plan to get America off foreign oil. I am a sustainability consultant and writer with a desire to reduce America's CO2 emissions. Our worlds collided when I interviewed Boone for my upcoming book.
As it turns out, our missions aren't so different after all. We both want to gain independence from foreign oil, revitalize the economy, protect the environment, and preserve America's status as a superpower. And we're not alone. These are the stated goals of U.S. presidents for the past 40 years.
So why is Pickens succeeding where so many others have failed? He's got a plan, for starters. Here's what Boone tells me to expect if we don't adopt his plan. And here are the opportunities available if we do:
Anna Clark: Boone, I've read through the Pickens Plan and I think I understand it. Could you share the most important elements of it for our readers?
T. Boone Pickens: It goes like this. In 1970 we imported 24 percent of our oil. By 2008, it was 70 percent. The cost of importing this much oil was $700 million dollars when the price of oil reached $140 per barrel. In a few years, this could easily reach $10 trillion dollars as the price of oil goes up. Think about it -- the world produces 85 million barrels a day and we use 21 million in America alone. We have only 4 percent of the population. What are we going to do when China and India catch up with us? That's a big problem.
But there is a solution. Seventy percent of the oil we import goes to fuel or diesel. We have the resources to offset this. Natural gas is our second largest resource next to coal, and the only one that can help with transportation. There are 8 million vehicles in the world running on natural gas today, so we know it works. There is enough natural gas to go around, especially when we talk about increasing wind power to 22 percent of our energy mix. Moving some of our natural gas to the transportation sector would cut our consumption of foreign imports by 38 percent and save $300 million from going to countries that don't like us.
AC: That sounds good to me. Does anybody oppose this plan?
TBP: Nobody opposes it. It's the only plan we've got. For 40 years we've had no plan and it took a guy who is 80 years old to come up with something. So my plan is the only one on the table. If you're not for it, you're for foreign oil. It's that simple.
AC: At a recent town hall meeting you said that if we could get 350,000 18-wheelers to convert to natural gas, we could reduce our imports of foreign oil by 4 percent. What are the challenges to getting fleet owners to jump on board?
TBP: There are no challenges. This is all based on price. Under H.R. 1835 [the "New Alternative Transportation to Give Americans Solutions Act of 2009," introduced by Rep. Dan Boren], fleet owners can get new natural gas powered trucks paid for. There's no reason for them not to do this.
AC: Do you believe that natural gas is viable as a fuel for public use?
TBP: Sure, but we'll have to wait for it to dribble down. If you want to drive green, you can go buy a hybrid, but it won't get us completely off foreign oil. Or you can do what I did -- install a natural gas pump in my garage and convert my car to run on natural gas. Anyway, we're focused on fleets because one diesel garbage truck emits as much pollution as 350 cars. Heavy-duty trucks are where we can make the biggest difference.
AC: In your book The First Billion Is the Hardest, you liken your wind deal to a 100-yard track with 10 hurdles. You figure you can get over 3 or 4, but you don't have $10 billion for the entire project. Can you give us an update?
TBP: It's a done deal. We've cleared all the hurdles. Mine will be the largest wind farm in America. We have the best wind in the world in West Texas.
AC: How do you finance a project like that in this economy?
TBP: We'll need a "wind bank" to finance large-scale wind projects. This would cost a fraction of the federal spending on a stimulus package. It'll also be cheaper than continuing to spend money on foreign oil.
AC: The U.S. Department of Energy says that 20 percent wind power by 2030 is feasible, but it cites transmission as a challenge. Half the country's population lives within 100 miles of the coasts and the bulk of wind power lies in less populated areas. How do landowners feel about putting in transmission lines?
TBP: In the 1950s we used eminent domain to build the highway system. Transmission lines could be like that. My friend Ted Turner and I talked about this recently and he agreed. He said, "If it's good for the country, then it's good for Ted Turner." I have a feeling that we're going to have a lot of landowners in the U.S. who say that too. This is for the security of the country.
AC: Do you believe that it would benefit America to have a national electricity grid smart enough to enable Americans to sell their power back to the grid?
TBP: That's fine and all if people want to generate their own power. I'm in support of people doing whatever they can. But it's pie-in-the-sky to think that enough people will be able to live off the grid to make a difference. We need a plan now that factors in the reality. We have an abundance of cheap and clean domestic energy in the form of natural gas. We need to use it.
AC: If America does not reduce its dependence on foreign oil over the next ten years, what kind of economy and standard of living do you think Americans will have?
TBP: If we continue without a plan, in ten years we'll be importing 75 percent of our oil at $300 a barrel. If that happens, we're sunk. That's $200 trillion going to nations that don't like us. We won't have to worry about health care or education anymore. There won't be any more money left to pay for them. In a world like that we'd become a second rate nation. You can bet on it.
AC: You're getting some traction at the governmental level. What about leadership from corporations?
TBP: Well, you saw in the news how AT&T has agreed to replace 8,000 vehicles to run on natural gas -- that's one fifth of its fleet. I know that this legislation will motivate many others, from major corporations and municipalities operating fleets on down to individuals to choose a truly American fuel at the pump.
AC: Do you believe Americans need to adjust their lifestyles?
TBP: Well, let's put it like this. I go into a room anywhere in the country and I ask for a show of hands, "How many environmentalists we got in here?" All the hands go up. Then I ask, "What if I told you it would cost you an extra $100 per month?" Suddenly those hands go down. People are still motivated by the price at the pump. I don't know what it will take to change that.
AC: What's your best guess as to what the price per gallon of gasoline would be if all of its environmental and national security-related costs were included?
TBP: The real cost is astronomical.
AC: Even if it's politically unpopular, isn't a gas tax the most efficient method to bring these hidden costs to light?
TBP: Maybe, but I'm not waiting for that to happen. My plan is better.
AC: You believe the future is in renewable energy. What would you advise our current and next generation of entrepreneurs who are interested in getting involved in this industry?
TBP: This industry is just about to burst open. There is enormous potential. My advice is to get as educated as possible between now and the end of the year. Read about what's happening in the wind and solar corridors. Also, monitor H.R. 1835. I think we'll know what we're looking at by August recess, but certainly by the end of 2009. We will have an energy plan for America for the first time in 40 years. That is where the opportunity is.
The Six Degrees of T. Boone Pickens
I ask Pickens how he's managing to get somewhere with a problem that has stymied presidents for the past four decades. "It starts with having a logical argument and presenting the facts," he tells me. But didn't Al Gore do that, too? How many politicians heard him?
"Well, Al Gore's my good friend, you know. He and I were just talking about this over lunch," says Pickens. "Al said to me, 'Boone, we're getting to a tipping point. Let me tell you about a moment that happened during the civil rights movement.'"
Boone continues the story, "One day a lot of peaceful demonstrators got hosed down for protesting. Kids came home from school and asked their parents, 'Why are those nice people getting hosed down?' The parents thought about it and said, 'You know, why is that happening, anyway?' Once the kids got a hold of it, the whole thing began to change."
Boone's story about a tipping point gets me thinking. Maybe it took Al Gore doing what he does best to pave the way for Boone Pickens to do what he does best. Or maybe on a subconscious level we find Pickens' blatant self-interest more relatable than Gore's altruism. In any case, he's succeeding at mobilizing 1.5 million Americans to support his plan -- and so far it looks like it's working.
As we're wrapping up, I can't resist asking Mr. Pickens to autograph several of his books. "Who's this one for?" What does he do?" asks Boone. I reply and he smiles. "Oh, I know what I'll tell him," he says. "He'll like this one!"
As he personalizes each book message, I can see what makes Boone so successful -- aside from several billions of dollars and unparalleled business acumen, of course. Boone is brilliant with people. His willingness to give every town hall meeting, media op, and speaking engagement the personal treatment has won him friends across the political spectrum. Who else counts West Texas landowners, Midwestern farmers, Californian businessmen, corporate giants, college kids, and a string of U.S. presidents among their list of friends?
By the time Boone is finished promoting his plan, it wouldn't surprise me if he knows every sixth person in America.
Pickens' Roadmap to Success
Pickens has taken his plan on the road from Main Street to Manhattan at the cost of $60 million of his own money. It may be the largest one-man special interest group around, but it's one that happens to address our nation's dependence on foreign oil and reduce our carbon emissions.
But is Pickens alone capable of ending our energy woes? No. Policy wonks say his plan will increase the cost of natural gas, a finite resource. And by pushing natural gas over other technologies, Pickens could help divert public money away from zero-emission vehicles and hybrid technology. Moreover, all these subsidies come at the cost of further increasing the federal deficit.
But you can't bake a cake without breaking a few eggs, right? Boone himself admits his plan is a bridge to the future, not an end in itself. One fact remains: nobody else has a non-partisan energy plan gaining this much momentum. For my part, I will be following the trail of legislation more carefully. According to Pickens, it's as good as a treasure map.
As I write this up, I realize that Boone didn't tell me anything he hasn't already said before. He's nothing if not consistent. In fact, this insight may be the real scoop to report. If you want to build Boone-style momentum for your own plan, make sure to:
1. Address a need. Clean power at a good price will always be in demand.
2. Know your pitch and don't waver from it. How many times do you think Boone had to say, "Natural gas is cheap, clean, and abundant" before it finally began to sink in?
3. Communicate your message through a multitude of channels. Boone had peddled his plan to everyone from the Boy Scouts to the U.S. Senate.
4. Appeal to emotions. Boone doesn't let us forget the economic and national security dangers of dependence on foreign oil. And who wants to be unpatriotic?
5. Give people a voice. People want to be a part of something bigger than they are. Pickens' campaign uses social media to create community and connect others, not just inform them.
6. Don't hide your success. People love Boone's big talk. He's not shy about telling us stories about losing and winning big. Remember, it ain't bragging if it's true.
Pickens' method is deceptively simple, but therein lies another key to his success. While every one else is still talking about what to do, Boone says, "Just do it." He is frank about his interests, follows his instincts, and doesn't get paralyzed by things outside his control. In short, Boone is a man with a plan, and like his grandfather used to say, "a fool with a plan can beat a genius with no plan any day."
Anna Clark is president of EarthPeople, a full-service consulting firm that helps companies of all sizes create and execute green strategies to save money and bolster their brands.