Milken's Matt Horton on Catalyzing the Clean Energy Project Pipeline

Headshot of Matt Horton

With billions in federal funding and incentives available to finance clean energy and climate infrastructure projects, in this interview with VX News, Matt Horton, Director of the Center for Regional Economics and California Center at the Milken Institute, elaborates the opportunities to catalyze the climate and clean energy project pipeline and operationalize resilient economic development strategies across California.  Following the SGC Catalyst Conference in February, Horton highlights an upcoming Accelerating Clean Energy Infrastructure summit at  CARB’s Southern California Headquarters in Riverside on April 14.


Matt, you have been taking the lead for some time on addressing the need for cities and communities to be strategic about operationalizing the new public climate-related infrastructure funding presently available to California. To that end, you will lead a panel May 1st at the upcoming VerdeXchange 2023 conference. What’s your message?

Matt Horton: Well, I think we're at a time when we've been clamoring for long-sought federal funding to meet some of our resilient infrastructure development needs and better realize some of the climate resiliency policy stewardship in terms of projects that the state has been marshaling for almost two decades.

We're also at a time when we need to be strategic about the deployment of those funds. How do we match that with energizing an economic development scenario around the state? How do we operationalize the Inflation Reduction Act and the Infrastructure Investment and Jobs Act into a new economic development strategy for California?


How ought cities and communities best operationalize the Inflation Reduction Act; specifically, how do cities and regions incorporate available public funding for climate-related infrastructure into a new economic development strategy for California’s underserved communities?


We ought to look to harness these funds as a means to create a new economic development framework around the state, one that support and create more opportunities for California residents, especially in areas that maybe have missed out on past eras of tech-based growth. This obviously means looking at Inland California, not from an extractive-kind of capitalistic expansion sense, but with the vision of how to incubate more opportunity in places around the state that create more jobs that pay better wages.

I think operationalizing this new funding requires targeting certain areas of renewable energy production, manufacturing, storage, and the underlying supply chain dynamics around wind, geo -thermal, hydrogen and hydrogen-fuel storage.

We’d also like to have that triple bottom line dynamic of incubating more resilient solutions that can become a model for other places where the state is looking to operationalize a more resilient economic development strategy.


In addition to VerdeXchange Conference in May… share with readers your current plans to cohost a Mid-April Clean Energy Infrastructure summit at CARB’s Southern California Headquarters in Riverside?


So, the Department of Energy Loan Program is a separate part of the funding that was approved through the Inflation Reduction Act and the Bipartisan Infrastructure Law. That loan program has this ability to really catalyze a lot in terms of geothermal and hydrogen fuel production storage.

What we're planning to have is a conversation with local jurisdictions at the California Air Resources Board facility about what that would actually look like in the from a jobs and workforce standpoint or from a fuel technology standpoint. What does this economic development scenario look like in terms of an opportunity that cities can help incubate? How can the funding from this DOE program specifically help support those local goals?

We’re doing it at the CARB forum is not just to talk, but to align funding with specific planning and, hopefully, create shovel-ready opportunities that can build towards that economic vision that I mentioned earlier.


Who will be participating?


They are an array of local, state, and federal leaders including leaders from the DOE Loan Program, state representatives and developers. I think it amounts to fewer than 200 people or so, but we're looking to have a pretty dynamic and not just thought-provoking, but action-oriented conversation.


Why is such a conference/conversation, to be provocative, still needed in California?


I think we do a great job in California in dedicated planning resources and getting ready for potential growth, but what we lack is impact and development that can take our planning aspirations towards implementation.

What this federal funding does is hopefully help us realize and or decide how we move beyond our planning exercises towards shaping real impacts. This is going to require long term and dedicated technical assistance and capacity-building efforts on the ground with cities.

We’ve struggled with that in the past (like in 2009/ 2010 with ARRA) and we’re going to need to look at existing projects and programs that might be able to harness, absorb and deploy these new funds, projects and efforts are aligned with Transformative Climate Communities or look at Cal Enviro Screen to explore where we can make impact investments in historical disadvantaged communities as well as other programs that current ­­­­­­­cap-and-trade funding supports. If we can add some certainty to these resilient infrastructure development efforts matched with latent potential for value capture tied to the increased revenues and resulting commercialization spillover effects associated with the (re)industrialization opportunities in the renewable energy, production and manufacturing incentives embedded in the IRA and IIJA (perhaps further boosted by complementary state place- based incentives like CalCompetes, R&D and new markets - which currently do not have a sector  or industry prioritization focus) we can begin to realize this new economic framework. 


What, if any, alignment does the Milken Institute presently have with California’s Strategic Growth Council (SGC).


Now, in my role as a senior advisor with the Milken Institute, but last year we able to from a great partnership with the team at the Strategic Growth Council to look out at shaping how the state and local communities were positioned to access the billions of dollars that have been earmarked for California (through the IIJA and IRA) and asking, how are we going to make best use of these funds? What is a resilient future with resilient economic development? What is dependent on us right now to meet this moment from a public policy standpoint?

So, we through partnership we the Climate Catalyst Conference that hopefully will become an annual meeting place around the issues that multiple communities are dealing with, in terms of harnessing this funding towards real shaping and realizing solutions. How can we better support that from a public finance standpoint? How do we help accelerate or identify project and or economic development priorities, with added resources at the local level, whether that's technical assistance on grant writing or some policy framework that gets these projects moving faster with partnership on community-based needs?


Given the Milken Institute historic preference that the private sector should lead on economic development, what explains why the private sector is less involved, engaged, and aggressive re climate change/economic development than is California’s public sector?


On the private sector front what we continue to hear is the need for a sense of certainty which the state can help provide with skin-in the game pre-development funding support and or prioritization framework that accelerates development and removes costly delays. The private sector needs to know projects and associated development isn't going to be overly delayed by a costly regulatory apparatus which adds risk.

For the public sector, this conversation presents an opportunity to structure a hub-and-spoke dynamic almost like a community asset pool or pipeline of projects (tied to CERF, IRA, IIJA) and associated economic development priorities. Some might question where these projects can be generated or pulled from? While we know we have cycles of past RTP’s and regional SCSs’ and other potential projects associated with city climate action plans etc., all around the statethat have community buy-inwhich I think signals a willingness at the local and regional level to realize these projects.  


Share with readers the expected outcomes that you hope will come over time from the April, Accelerating Clean Energy Infrastructure Summit in Riverside?


I think we want to really ignite a spark of recognition amongst city and state leaders around how we can pull down this funding to meet some of our resilient, renewable energy aspirations. We want to get to a sense of where those investments can be made in the region, not just in the Inland Empire, but around the state.

Then, we want to get to a point where we can align what the state and local communities have already been doing with this new funding, so we can make it more catalytic while addressing some of systemic deficiencies around community and place-based investment.

This is a competitive moment for us, as other states start to look at where their assets align and how they can pull down these dollars. With the race for business formation can we scale or apply exiting incentives that support industry and jobs that we already have in the state, like the California Competes Tax Credit? Maybe look at those incentives and credit enhancements can be aligned with the complementary tax provisions in the IRA that can help further this conversation about spurring a new economic development around renewable energy production.


Arnab Pal, from DOE LPO, will be at both the IE summit and VerdeXchange VX2023 Conferences. Elaborate on Arnab’s role with DOE?


Arnab has really been instrumental in creating this project use case scenario that outlines a few project types that the funding from the loan program, as an example, could support. Where are these types of funding opportunities in California? What cities have a site or an existing program or even just an aspiration that could support something like this? If so, how do we expand this array of project use cases as a mechanism to get things moving in California?

This action orientated dynamic underlines the April summit. I hope we can either get some hands that go up around those project use cases or even add to the list of ideas that might align, from on-the-ground aspirations to real world impact and then follow up, get the necessary technical assistance in place to build capacity and see impact.


Lastly, leveraging the upcoming April summit, will be, as noted, VerdeXchange VX2023 on May 1st. How might the latter’s audience best contribute to ensuring incoming IRA fund in fact scales the market opportunities for clean energy and sustainability?


With the passage of the IIJA, IRA, and other COVID related recovery resources sources (e.g., SSBCI, unspent ARPA, etc.,), cities and local jurisdictions across the country are poised to access generational funding that can make up for decades of under and disinvestment in many communities.

Now that we put some of the worst of COVID behind us, and now that we have this new funding reality in front of us, we’re hoping to meet this moment with the kind of stewardship on deployment that we've been preparing for in California.

Now, meeting this moment with impact and deployment is exciting, but scary. We saw a bit of this in 2008 with the American Recovery and Reinvestment Act, and some of the problems we had there with meeting shovel-readiness with available funding. We were spinning the wheels on things that didn't work and acquiescing to the persistence of some bad ideas.

For instance, we don't want to keep pouring money into highway widening projects but reconnecting communities. And we need to find a way to put money into a new resilient project pipeline that we want to see built. So, we've got to stop doing what doesn't work or things that we don't want to see done.

We’ve got to start prioritizing and accelerating the things that we want to see in our resilient future.



“How do we operationalize the Inflation Reduction Act and the Infrastructure Investment and Jobs Act into a new economic development strategy for California?"- Horton