Public Statements & Remarks

Statement of Commissioner Christy Goldsmith Romero on Electric Vehicles, Electric Power Grids, and Renewable Energy Before the Energy and Environmental Markets Advisory Committee, Nashville, TN (Virtual)

February 28, 2023

I want to express my gratitude to the members of the Energy and Environmental Markets Advisory Committee (“EEMAC”) for your service.  I also want to recognize Commissioner Mersinger for her leadership over EEMAC and the staff for their work in taking EEMAC on the road to Nashville, a town with good music and good food.  The last time I was in Nashville, I found myself eating dinner in the same restaurant as Al Gore, who as you know, was one of the earliest leaders to seek solutions to climate change.

Electric Vehicles and the Effect on Metals Markets

I wish I could have joined those of you who toured General Motors’ electric vehicle plant.  As the Special Inspector General of the Troubled Assets Relief Program (“TARP”), I conducted oversight over General Motors during the four years that GM took part in TARP programs.  I even testified before Congress about GM.

Demand for electric vehicles (“EVs”) is soaring.  EV sales have tripled in the last two years.[1]  According to a recent survey by Consumer Reports, more than one third of Americans plan to buy or lease an EV or are seriously considering doing so.[2]  With that anticipated growth, all eyes are on metals and the critical minerals needed for batteries.

The United States is making historical investments in electric vehicles and battery manufacturing.  In October 2022, the Biden Administration launched the “American Battery Materials Initiative.”  This is an effort to secure “a reliable and sustainable supply of critical minerals used for power, electricity, and electric vehicles.”[3]  This Initiative is designed to make America more competitive by growing an American battery supply chain, rather than relying on China or other foreign supply chains for the critical minerals used to produce EV batteries.[4]  The Department of Energy has provided billions of dollars to support battery-grade metals.[5]  EV tax credits under the Inflation Reduction Act (“IRA”) must meet standards on domestic battery production, including that a substantial percentage of battery components and critical minerals must be produced, extracted, processed, or recycled in North America.[6]

I look forward to the discussion about growth and challenges in the metals markets related to the expected increase in EV production.  With respect to the listed derivatives markets, CME’s Q1 2023 metals update states that “[b]oth lithium and cobalt contracts have found quick adoption from the marketplace, as the automotive sector seeks to manage commodity price risk in the transition to higher EV production volumes.”[7]  It will be important for the CFTC to have a clear understanding of how the metals derivatives markets are working with increased EV domestic production.

Electric Power Systems and Renewable Energy

I also look forward to the discussion on electric power systems and renewable energy.  Our electric power system continues to experience stresses amid severe weather events, many of them climate related.  Major electrical grid failures increased in the United States by more than 60% from 2015 to 2019.[8]  Between 2000 and 2021, about 83% of U.S. major outages were attributed to weather-related events, which appear to be “increasing in frequency and intensity” due to climate change.[9]  Much of our power grid was built decades ago, and was not designed to withstand frequent, extreme climate events.

Renewable energy sources, like solar and wind, are being deployed in the U.S. at increasing rates.  Solar and wind energy sources are expected to account for 16 percent of total electricity generation in 2023, which is more than double the share generated from those sources in 2018.[10]  This change will be driven, in very significant part, by expected expansions in solar capacity.[11]  Longer-term, the move towards U.S. reliance on renewable energy sources may be dramatically accelerated by the IRA.  By 2030, according to American Clean Power, the IRA will have put in motion investments that will mean that “roughly 40% of the country’s electricity will come from wind, solar, and energy storage.”[12]  This, in turn, will mark substantial progress towards climate goals and could provide thousands of U.S. manufacturing jobs.[13]

The increased deployment of renewable energy will require infrastructure that can reliably distribute renewable energy from wind- and sun-rich production areas to population centers where the energy will be used.  Large-scale investments in storage and storage technology, like those incentivized by the IRA, also can improve reliability and relieve stresses on the grid.

As we accelerate a transition to more renewable energy, it will be critically important to ensure that renewable energy producers have access to appropriate hedging tools for managing price risks relating to grid congestion.  Some recent studies have suggested that certain renewable producers, like wind plants, for example, face higher risks from congestion than certain other sources.[14]  Financial transmission rights (“FTRs”) and similar types of contracts could help manage congestion.  However, given that FTRs developed long before wind and solar played a significant a role in U.S. power generation, I’ll be particularly interested to hear how FTR markets have evolved, or need to evolve, with the growth of renewable energy.

As advisors to the Commission, you play an important role, and I look forward to hearing your thoughts on these important energy and environmental market issues.

[1] See White House, FACT SHEET: Biden-Harris Administration Driving U.S. Battery Manufacturing and Good-Paying Jobs, Oct. 19, 2022,

[2] See Consumer Reports, More Americans Would Buy an Electric Vehicle, and Some Consumers Would Use Low-Carbon Fuels, Survey Shows, July 7, 2022,

[3] See White House, FACT SHEET: Biden-Harris Administration Driving U.S. Battery Manufacturing and Good-Paying Jobs, Oct. 19, 2022,

[4] See Id (“China currently controls much of the critical mineral supply chain and the lack of mining, processing, and recycling capacity in the U.S. could hinder electric vehicle development and adoption, leaving the U.S. dependent on unreliable foreign supply chains.”)

[5] See Id.  This includes investments under the Bipartisan Infrastructure Act and the Inflation Reduction Act.

[6] See Bipartisan Policy Center, IRA EV Tax Credits: Requirements for Domestic Manufacturing, Feb. 24, 2023,

[7] See CME Group, Q1 2023 Metals Update (Feb. 1, 2023),

[8]  See Brian Stone, Jr., Evan Mallen, Mayuri Rajput, M., Carina J. Gronlund, Ashley M. Broadbent, E. Scott Krayenhoff, Godfried Augenbroe, Marie S. O’Neill & Matei Georgescu, Compound Climate and Infrastructure Events: How Electrical Grid Failure Alters Heat Wave Risk, 55 Environ. Sci. Technol. 6957 (2021),

[9] See Climate Central, Surging Weather-related Power Outages (Sept. 14, 2022),

[10] See U.S. Energy Information Administration, Increasing renewables likely to reduce coal and natural gas generation over next two years (Jan. 19, 2023),

[11] Id.

[12] J. Hensley, Inflation Reduction Act: It’s a Big Deal for Job Growth and for a Clean Energy Future, American Clean Power, The Power Line (Aug. 5, 2022),

[13] According to American Clean Power, in the three-and-a-half-month period following the passage of the IRA, there were more than $40 billion in domestic clean energy investments.  In the same period, 20 new or expanded clean energy manufacturing facilities were announced, opening the door to perhaps 7,000 new U.S. manufacturing jobs.  Id.

[14] See, e.g., Lawrence Berkeley National Laboratory, Rethinking the Role of Financial Transmission Rights in Wind-Rich Electricity Markets in the Central U.S. (Jan. 23, 2023), (”Wind plants typically face a larger and more negative basis than do thermal generators, and hence are more negatively impacted by congestion due in part to the negative correlation between wind generation and wholesale power prices.”).  The Lawrence Berkeley National Laboratory is a U.S. Department of Energy Office of Science national laboratory managed by the University of California.