In this episode, I sit down with financier Tom Steyer to discuss his 2026 run for governor of California. We dig into his pledge to cut the state’s notoriously high electricity bills by 25 percent, how he plans to break the stranglehold of investor-owned utilities through local competition and smarter grid utilization, and the delicate politics of pushing a climate-forward agenda when voters are primarily focused on the immediate cost of living.
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David Roberts
Greetings, everyone. This is Volts for April 27, 2026: “Tom Steyer wants to be California’s climate governor.” I’m your host, David Roberts.
Today’s guest is billionaire financier and longtime climate crusader Tom Steyer, who — thanks to the Eric Swalwell campaign’s recent implosion amid sexual misconduct allegations — is now narrowly leading the Democratic field in California’s 2026 race for governor. He has edged out Xavier Becerra and Katie Porter in the most recent post-Swalwell polling, though the three of them are bunched together within the margin of error.
The June 2 primary is about six weeks away. Steyer is self-funding to the tune of over $100 million, and the interests he has picked fights with — the investor-owned utilities, the oil companies, the realtors — are going equally big against him.
I have not endorsed anyone in this race and I’m not about to, but Steyer is the climate-forward candidate in the country’s biggest climate-forward state, at a moment when climate policy is at a crossroads and climate as a political issue is visibly in retreat. That seemed worth an hour.
We talked about his pledge to cut electricity bills by 25 percent — what it means for utilities and how the math adds up. I asked him about the YIMBY fight, wildfire costs, refinery closures, the Iran war, transit’s fiscal cliff, and his take on where the climate cause stands now, fifteen years after he first jumped into it.
Here’s my conversation with Tom Steyer.
With no further ado — Tom Steyer, welcome to Volts. Thank you so much for coming.
Tom Steyer
Thank you very much for having me, Dave.
David Roberts
Tom, I’ve spent the last few days reading and researching this, and the main conclusion I’ve come to is that you would have to be crazy to want this job. Let’s start there. There’s a baseline of crazy you must have to be pursuing this. Many issues we could touch on. I’m trying to prioritize a little bit.
I want to start with electricity, my beloved topic, the main subject of my podcast. Currently, California has the second highest electrical bills in the nation. They have risen sharply, at least since 2019. Now, when you see polls, a majority of Californians are saying this is a top issue, a big issue.
You have pledged to bring utility bills down by 25%. That is a bold claim. I want to dig into that a little bit. Let’s start with utilities. You said in some of your campaign ads that you’re going to break up the monopolistic utilities. But then in a press conference a few weeks ago, you walked that back or clarified that you do not literally mean that you want to break up PG&E. I’m just curious, what do you mean, what do you want to do to and about utilities?
Tom Steyer
Let’s start with a little discussion of the investor-owned utilities in California, of which there are three. They are all legal monopolies. You are not allowed to compete with them. They charge twice as much as the average in the United States. That is a punitive situation, but entirely predictable given the fact that they are a legal monopoly that has legally no competition.
They also have, Dave, very distorted and unhelpful incentives from the utility system where they get a 10% guaranteed return to their equity for every capital expenditure that the Public Utilities Commission allows into the rate base. That’s how they make money. Most people don’t understand that. I’m sure you do. But that gives them an incentive. If you have a choice between a $100 million plant and a $200 million plant — “If we do the $100 million plant, we’ll make $10 million. If we do the $200 million plant, we’ll make $20 million. Boys, let’s do the $200 million plant.” It’s a huge distorting incentive. What I’ve said is, would I like to break them up?
It turns out there are two big municipal utilities in California, one in L.A., one in Sacramento. They both charge about half what the big monopoly electric companies charge.
How am I going to do that? Part of it is by different oversight from the Public Utilities Commission where we’re incenting different behavior and insisting that they’re obeying it. Also, the idea that they need a 10% return on equity in a guaranteed form with about a 50/50 debt-to-equity ratio makes no sense as well. Dropping that number will make a dramatic difference. But the big thing is I also want to be able to enable local competition because if you look at how this is happening, the cost of electricity — you say “you love electricity” — me too. There’s an electricity revolution going on in the world. The cost of clean energy is plummeting and the cost of batteries is plummeting and everyone around the world is taking advantage of it except us.
If we allow local competition, it costs between solar and batteries or wind and batteries — that’s 3 or 4 cents a kilowatt hour. Just to put that on the table. We’re getting charged somewhere between 30 and 40 cents a kilowatt hour. Is it going to be necessary if we’re going to do community choice aggregators, to do the local grids, are we going to rebuild everything? No. Are we going to use their poles and their wires? Yes. Is that worth 37 cents? No.
We’re going to be able to produce energy and distribute it locally much cheaper, which is going to force these big monopolies to reduce their costs or lose customers. It’s going to be competition that drives down the price of electricity. To say 25% — let’s be clear. If we drive down the cost of electricity by 25%, we will still be 50% more expensive than the average in the United States of America at a time when electricity prices around the world are plummeting. When everyone’s saying, “Oh, that sounds impossible,” it’s — really? Let’s put it in a context. Does that even sound like a fantastic outcome? That sounds like a better outcome, but not a fantastic outcome.
David Roberts
Let’s talk about this. What you are talking about is retail competition. I think Volts listeners mostly know there is wholesale and retail, and retail is just the last mile serving the electricity to the customers. There have been some analyses that show that only about 15 to 20% of bills are really on the generation side, the side that you could get at with retail competition. Most of the cost is in the poles and wires themselves, in maintaining, in transmission and distribution, which you are not going to get at with retail competition.
Tom Steyer
But we are going to get at, Dave, on the first half of this. I agree with you. Let’s talk about how we drop the costs in terms of how the overall system works. If you look at what’s going on, and I know this because I’ve spent a lot of time looking at some of the new technology that lets you, for instance, take a 35% efficient grid up to 60%. You don’t have to rebuild your —
David Roberts
Utilization. I saw this in your plan. It made my heart all aflutter. I’ve done a couple of pods on grid utilization. Say a little bit about that. What would you want? How could utilities increase utilization or how do you push them to do it?
Tom Steyer
They’re very slow to let people onto the grid. 73% of the time, they don’t make it in time. They want to rebuild the grid because we’re capacity constrained at 35%. I should mention to people, there is this thing called information technology. There’s this other thing called artificial intelligence. They’re now able to be used to take that 35% efficiency up to at least 60, so you don’t have to rebuild the grid to almost double the capacity of the grid. We’ve seen this at a lower level in Iowa where the cost to use information technology and sensors, as opposed to rebuilding the grid, was a fraction, and you could do it without putting the grid down while you rebuilt the whole thing.
This is an easy thing to do. Let me say this. This is not something that works well for the bottom line of electric monopolies. Therefore, they are not really interested in this. This is not the kind of thing they want to do because for them, if they rebuild the grid, that all goes into the rate base and they get a 10% guaranteed return on that. But for ratepayers, for the people of California, that saves them a gigantic cost and allows a whole bunch more utilization of the grid, which also drives down the overall cost to every single user. It is a big difference when you talk about the poles and wires and all that stuff. The truth is this is a much more efficient grid and therefore the overhead for every single user is lower.
David Roberts
But in terms of how to change their incentives to push them to do that, you are not talking about new legislation or even new regulations. You are mainly talking about appointments to the CPUC that would —
Tom Steyer
That is the first thing.
David Roberts
Jawbone them, bully them into doing it.
Tom Steyer
No, we’re going to give them different incentives. We absolutely have to. We’ve got to change this structure because you can’t be mad at executives that you give incentives to do uneconomic things, things that will drive up rates and then go, “You drove up rates.” It’s — yeah, you paid them to drive up rates and then you were mad at them when they did. We’ve got to have a different PUC and we’ve got to have different incentives because these are perverse and they’re definitely paid to gold-plate everything, to make everything as expensive as possible and, honestly, without fear of competition.
That’s where we are, and that’s why we are where we are. I’ll give you one other, Dave, which you probably know in some version. In Silicon Valley, if you have a new technology, your customer base, the median customer — the 50th percentile customer — adopts it in 18 months. Traditionally, in the electric utility business, the median customer adopts a new technology in 35 years. There is no incentive. Everybody’s sitting here going, “We can’t do better, we can’t do better, we can’t do better. You’re talking about something that’s impossible to do, Tom.”
35 years. It’s a seven-year vetting cycle. Seven years. That’s where we are. They come from a different world. It’s not a tech world, it’s not an innovation world. You know if you love electricity, we’re in a revolutionary world — we’re dramatically changing it based on new technologies. Their desire is to keep gold-plating everything and driving up the rate base and therefore their profits.
David Roberts
Another big cost center that has been identified specifically in terms of California rates is wildfire prevention and remediation. Huge and growing problem, obviously. A lot of people lately have been raising the idea that wildfire prevention and remediation help the whole state, and thus the whole state ought to be paying for it, not just ratepayers.
In other words, there’s been talk about moving these costs out of rates into the tax base because, as I’m sure you know, putting things in electricity rates is the most regressive conceivable way to pay for something, whereas the state income tax is much more progressive. Plus, the same people say, “we would like to keep electricity prices as low as possible if we want to encourage electrification.” All of that said, have you thought about this idea?
Tom Steyer
I’ve thought about it, but I want to — I want to be such a one-note Charlie, I want to go back to a previous point I was making about this, though. What the public utilities are choosing to do is to underground all the wires. They are paying $3 million a mile to underground those wires, and that goes into the rate base. Do I think that that’s the cheapest way to do this? I know that’s not even close. I know that they’ve got the PUC to agree to it, but the fact of the matter is there are technologies on this that would do this for a fraction. What they are doing is exactly what I said to you. They are gold-plating the system so they can drive up the rate base and get a guaranteed return.
David Roberts
But even so, don’t you think it would reduce rates?
Tom Steyer
I know. Everything you said is true. But the way this is going, they have a perverse incentive to do this, and it is very bad for ratepayers. Your point of should they be paying for everybody in the state or should we be keeping electricity rates low and letting the taxpayers pay for it has a lot of validity. The legislature made a different decision a while ago. Do I agree with you? I got your point.
Get my point, which is they’re not using technology to solve this problem. They’re not using the cheap things they could do to solve this problem. They have chosen to do the most expensive platinum gold-lining that they could think of and the PUC let them do it.
David Roberts
A final question on that. Governor Newsom signed SB 254, which put this big flat charge on electricity rates going forward, I think nine years or 10 years or something like that. He did the opposite of what these people are talking about. He definitely put these costs squarely in electricity rates. Would you have signed that bill? I guess that is my question.
Tom Steyer
That is not the way that I would have solved this problem. I think that the governor has done a lot of good things about wildfire prevention in terms of controlled burns, getting rid of a lot of the dry timber around the state up in the Sierra, and a number of things of that nature. But I have a very different opinion about the electric monopolies that are driving electric rates in our state. They are spending millions and millions of dollars to prevent me from getting elected governor.
David Roberts
Yeah, I heard they are funding a PAC.
Tom Steyer
They are funding an anti-Tom Steyer PAC because they are worried that I will do exactly what I am saying, which is I will give them different incentives. I will have different people in the PUC and we will promote local competition, and that is very real and therefore their monopoly. Every monopolist loves their monopoly. Every monopoly will explain to you — “The world will end if you get rid of my monopoly.”
That’s what AT&T said. They said, “If you get rid of our monopoly, there will never again be a phone call completed in the United States of America.” But when they broke it up, if you will remember, the explosion of creativity in telephony blew everyone’s mind. The truth is we’re seeing that in the energy world in terms of new ways to generate electricity, new ways to store it, new ways to use it, new ways to conserve it, new ways to send it back and forth. There is an absolute explosion of new ideas and new technology. This system is stifling that in the State of California.
David Roberts
If you think 10% rate of return is too high, do you have a rate of return in mind that you would push your CPUC to target? Do you have a specific number in mind?
Tom Steyer
Look, I think the whole question in this, as someone who is an investor, is — okay, what is the risk involved? A 10% rate of return guaranteed to a 48/52 balance sheet guaranteed by the state of California is way too high. Are you kidding me? The question is, what is the risk to that? What is the thing that would make that not come true?
David Roberts
Do you have a number in mind or would you want to see some analysis?
Tom Steyer
I would like it to be a couple percent lower. But, Dave, in this stuff, I know God’s in the details, I really do. I think that the way this will work is for us to have a vision of where we want to go and then make sure that the details work, not trying to put these people out of business. I’m representing the ratepayers and citizens of California who have a monopoly that is taking advantage of them. That is very clear. People in California, if you go around California and talk to people, I can tell you there’s a deep, deep anger about what’s going on.
The people of this state are very stretched between housing costs and health care costs and electricity costs. The idea that we’re not going to address those problems is a gigantic mistake. I’m the person in this race who’s pushing for change. The people who are profiting from the status quo are pushing back at me very hard. But the truth is the people of California are at their wits’ end.
David Roberts
Let’s talk about transportation a little, because speaking of affordability, California now has the highest average gasoline price in the nation at $5.30. I think the national average is up to four. This is a vexed and difficult subject in California. Right now you have a big refinery closed at the end of 2025. There’s another big refinery that is set to close this month.
On the one hand, climate-wise, it might seem like a good idea. On the other hand, forecasts are that those two refineries closing will raise California gasoline prices, which are already the nation’s highest, by an additional more than a dollar to the point that Newsom spent the last year in office trying to shovel money at this refinery to keep it open. This is not a great look, but also you don’t want gas prices going up even further.
You have been asked about this before and your response a few months ago was, “We should import more from Asia,” which made sense at the time, but since then circumstances have changed quite a bit and importing oil now looks much more vexed and much more slow and much more expensive than it did. A rock and a hard place here. How do you offer short-term relief to California drivers and then long-term, what do you do about transportation affordability more generally in the long term?
Tom Steyer
I agree. Dave, let me say this. The price of oil has gone up $1.50 in the state of California because of this failed war in Iran declared by Donald Trump, which is putting $70 billion more into the pockets of the oil companies who got them elected in the first place. Are their costs going up? Is this somehow a cost-based problem that American oil companies suddenly have? Their costs go up because they have closed the Straits of Hormuz? No, this is a straight windfall profit to the oil and gas companies.
In the short run we should have a windfall profits test the way that we did in the 70s. It’s on the books in California. We’re not enforcing it —
David Roberts
On California oil companies?
Tom Steyer
On the oil companies who are selling oil in California. That windfall profit, which is totally a result of this war in Iran and nothing to do with their costs, should be delivered right back to Californian consumers, not to the government of California, but directly to the people of California to pay them back for that dollar and a half.
David Roberts
Before we go long term, let’s talk about the refineries. Do you think it is worth your effort to try to keep this refinery open to hold down gas prices, or are you going to let it close?
Tom Steyer
I understand that we are beholden to a very small number of refineries because of the position that we’ve put ourselves in. Therefore, it’s important for the people who are still driving — which is most Californians — internal combustion cars. It is important for us to make sure that those refineries stay open or to get oil from overseas at a competitive price. As you point out, what was true is less true because of the blocking of these straits and therefore the blocking of oil and gas to Asia. Understood? Yes. Do they have us over a —
David Roberts
You’re going to do it. You’re going to make a pun.
Tom Steyer
— have us over an oil barrel. I got it. The answer here is to get off oil. As I say, solar and wind don’t go through the Straits of Hormuz. The cost of electricity is plummeting. You said you’re in love with electricity. It’s plummeting around the world. The cost of electric vehicles is plummeting around the world. An electric vehicle is a battery with a car stuck around it. The cost of batteries is going to go down 80% this decade. The cost of EVs is going to go down enormously along with the cost of that battery.
We know already that the most efficient electric vehicle manufacturers in the world, in China, for $26,000, can deliver an EV with a 400-mile range. We know the game is over. We know it’s cheap. The point is, EVs are more expensive to buy. They’re more expensive to buy here. The truth is, I would triple the tax credit to move people to EVs.
David Roberts
This is my question because the Republicans federally have gone after a lot of things, among which the California waiver, which allowed California to set its own fuel economy standards. That’s being fought legally now, but there’s at least a decent chance that that’s going to go away. Where does that leave you? What are you going to do to make up for the loss of that waiver?
Tom Steyer
We need to move off internal combustion engines, period. That’s why I would triple the credit to move people to EVs. The upfront cost of an EV is cheaper. It’s already cheaper to maintain, it’s cheaper to fuel up. By the way, if I drop electricity prices by a quarter, that will make it that much cheaper to fuel up. We need to move there. The idea that we should be allowing more gas guzzlers because the actual pollution isn’t harming anyone — I want you to call the people in Pacific Palisades, in Altadena, and explain their houses didn’t burn down.
The Trump administration literally said they want to go back to the 1950s with Woody station wagons. Gas guzzling is good if you’re an oil and gas company. But if you follow the reason that clean electricity is so important, it is to drive down costs. It is cheaper. It is important that we move to that so that people who are strapped at the end of the month have lower bills. It’s also important that we don’t burn down cities in California.
It’s also important that we don’t have high electric bills, we don’t have high house insurance bills. All the other things that are happening in terms of food bills. The idea that anything that the Trump administration is talking about, about allowing more gas guzzling — “Let’s prevent us doing a sensible thing that is cheaper in terms of electricity and energy” — is insane. California should be going the exact opposite way.
David Roberts
You think through boosting tax credits, you can make up the gap that is left by the loss of the waiver?
Tom Steyer
No, I think that that is something that can — I know that not everyone’s going to sell their car today. I know that the speed with which people are buying solar panels in Europe doubled over this war. I know that the move to an EV — now it’s cheaper in the life of an EV to own an EV if you include the cost to fuel it and the cost to maintain it. Now, EVs are cheaper. Upfront isn’t cheaper.
David Roberts
I just heard in the UK upfront just got cheaper. Putting aside savings over time, even the upfront cost is cheaper in the UK now, not in America.
Tom Steyer
There is no question where we’re going in terms of costs. Battery costs are what drive an EV and they’re going down 80% this decade. It’s over. I know you’ve read my book, Cheaper, Faster, Better: How We Win the Climate War. What I want to provide people in California is something that is cheaper. EVs are faster if you’ve driven one, and it’s better. That’s the whole point. Let’s get people to make the smart decisions that also have the second-order effects that help us and let’s stop subsidizing.
Do I think oil and gas is cheaper? By the way, why do you think we are spending $200 billion in a war in Iran? Do you think that has anything to do with oil and gas? I do.
David Roberts
Can we talk about transit then? The other way to reduce transportation costs is to make more and better transit alternatives. Transit systems across the state, across the country really, but especially across California, are facing this fiscal cliff. This is extremely acute in California right now. There’s a bill, it’s going to be on the same ballot you are — SB63 — that would raise a little bit of sales tax revenue to fund Bay Area transit agencies. I’m curious whether you support that, but beyond that, do you have a plan for rescuing transit in California?
Tom Steyer
I am in favor of that bill, Dave. I don’t know whether you know this, but last year I was also a strong proponent publicly, both in terms of talking to people, but also writing an op-ed of a rezoning proposal in the legislature.
David Roberts
We’re going to get to the housing stuff.
Tom Steyer
No, housing and transportation are the same thing for sure. If you have dense housing where people can take public transportation to where they need to get to, then people use public transportation. The issue is that bill was about dense housing near public transportation. When you talk about why there would be a fiscal cliff, it’s because there isn’t enough ridership. Over time, what we need to do in California is build more densely for a whole bunch of reasons.
David Roberts
That’s a long-term thing. Do you have a short-term fix for the cliff? Because it is a cliff.
Tom Steyer
It depends how long-term is long-term. I’m talking about building a million houses in the first four years around public transportation in dense places. Is that the fix of all fixes? I think we need to do a lot more than that, but it’s a pretty good down payment. When we’re really talking about public transportation, we need to have dense urban environments around public transportation where people can get around. They don’t drive an hour and a half to work. They don’t have to be the Uber driver for their kids.
They can live in a place which is a walkable neighborhood and where people take public transportation to get places. That is something that works all over the world. That is the move we have to make. Much of California is built around the car. No one loves an hour-and-a-half commute. No one loves sitting in traffic. We’re going to have to make it possible for people to avoid both those things.
David Roberts
A common criticism in California — this was a part of the Abundance book, I’m sure you have heard it talked about — and that transit agencies in California spend on a per capita basis way more to build than they do almost anywhere else. There are more employees per rider. The employees are paid more. This is part of the larger critique of just how expensive it is to build anything in the US. Do you have concrete ideas about how to bring down the average cost of building transit in California? Obviously that is a piece of the puzzle too.
Tom Steyer
It is a huge piece. I’m a big fan of public transportation and I’m not a big fan of spending enormous amounts of money for very little output in public transportation. Dave, let me say this. I’ve spent a lot of time thinking about how to build houses in California. I’ve spent a lot more time on that than I have specifically. I’ve said to the transit organizations, “I’m a huge fan of public transportation, but you need to come back to me with a plan that works from a financial basis.” I’m willing to go through that line by line with you. But don’t come back and say we’re doing it because we’re not doing it at any price.
David Roberts
What about high-speed rail? Speaking of any price, $1 billion a year is going from cap and invest currently to the high-speed rail, and yet it’s proving to be not nearly enough. Meanwhile, all these other transit agencies are starving. How do you think about that? Do you want to double down and make high-speed rail work competently, or do you think that money should be going toward more proximate transit?
Tom Steyer
Of course I want high-speed rail, but I don’t want high-speed rail at any price. That is what I said to those people — look, I’m a big fan of public transportation, but not at any price. You’ve got to come back to me and let’s go through how this could possibly work. It’s not going to be just one thing. I always say about building houses — no silver bullet, silver buckshot. We have a multivariate problem. We’ve got to deal with urgency with every one of these issues and we’ve got to be smart and we’ve got to use new technology and there’s no choice about it because people can’t afford to buy the houses that you can build in California. How are we going to get the cost down to a place where people can afford it so that people can go back to buying houses and affording their rent?
David Roberts
Let’s talk about housing then. You would be coming in on the tail of a pretty extraordinary five-year period of legislative activity around housing. YIMBY stuff — generally a lot of victories. There’s SB131, which exempts infill housing from CEQA, which is a very big deal. There’s SB79, which is about density around transit stops. A lot of the laws are in place and there are a bunch of smaller reforms that came before. But there’s been this report from the YIMBY Law Report — looked at all these previous reforms and said what’s happened is they haven’t had much effect on the ground because local opposition, locals are passing local ordinances to block these state laws.
Now you’ve escalated. Now there’s a law in place that says the attorney general can come in and start fining these cities per unit they’re not building per year. I’m curious how you think about that in terms of enforcing. How do you envision enforcing these things locally?
Tom Steyer
Everybody thinks it’s just about NIMBYism, that in fact it’s just — we like the way things are and we’re not willing to change. I think there’s been a sense over time that not building a new housing development is a victimless crime. “There was a vacant lot here before, there’s a vacant lot here afterwards. Nobody got hurt. What’s the big problem?” The big problem is we’re not building anything. That means that tens of millions of Californians are suffering urgently because they can’t make rent or are leaving California.
David Roberts
And moving to Texas.
Tom Steyer
Yes. This is not a victimless crime. Let’s talk about the legitimate reasons that a city or a county would push back against permitting and try to do everything they can to block it besides just NIMBYism, and that is this: they feel that every unit, every dwelling unit that is added is an unfunded mandate to them to provide education services and healthcare services. They do not have the money to do it. That is why you see fees to build a house that go up to as high as 20% of the cost of a house because they are trying to front-load the cost that they expect to see going forward. That is why they push back.
I have said that on the first day of me being governor, I will call a special election to close a corporate real estate tax loophole that’s been there since the 70s, that’s worth over $20 billion to the state of California, the city and county level, for health care and for education. The idea that they have an unfunded mandate will no longer be true. They will have a funded mandate. Is that important? It is important. Is that the only thing? Because that will give us a lever to say to them, “We are going to push you hard to get this done and if you don’t, then there’s going to be a carrot and a stick.” We’re going to provide you this money in order to do it.
If you don’t do it, there’s something called the pro-housing designation program where you reward people who pay. We’re going to have to use the money of the state to say, “Your legitimate reason for not doing it is gone. Now there’s going to be a carrot and a stick here in terms of money.” We’re also going to have to modernize the Surplus Lands Act. There’s a whole bunch of things the state can do to get over the issue you’re talking about. The NIMBYism itself? That can’t be okay.
David Roberts
Governor Newsom just, I think this month or last month, sent out notices to I think 15 cities saying, “Get on the stick or I’m going to pull this AG thing on you. I’m going to refer you to the attorney general and you’re going to start getting fines.” Will you refer them to the attorney general if they don’t do what they need to do?
Tom Steyer
That will be one of the tools in the toolbox. I want to go back to this point about victimless crimes. It’s not a victimless crime. I’ll give you an example of this. The number one population that is growing in terms of homelessness is people over 65 who can’t make rent or lose their house. Think about that. That is not a victimless crime. That is something where something really serious is happening to people who are really at the end of their rope.
We’ve been endorsed by some of the people who work for the University of California as custodians, as dining hall workers, in a variety of — not professors. I talked to one of those guys who’d worked for the UC as a custodian for 20 years, living in his car, fully employed, never been unemployed, fully employed, living in his car. I talked to somebody who is 30 — I talked to his mom — 35 years old, lives in Salinas with his mother and commutes an hour and a half each way to Apple Computer. Not a poor company. My point being, this is not a victimless crime. Do we need to push to build what I’m saying we’re going to build, which is a million units in four years? We really do.
It is about permitting, it is about zoning, it is about overcoming the resistance of cities and counties, some of it legitimate, but it is also about building cheaper because there are tens of thousands of units in California that are permitted and zoned and not being built because we cannot build them cheap enough. We have got to use — I was saying to you, we have got to use new technologies to make the grid more efficient. It is really infinitely cheaper, infinitely faster, infinitely better. The point is, we can build houses in a different way where we are doing industrial construction off-site and then assembling them on-site. They are new technologies. They are much cheaper. They need revenues and demand for it to happen. The state of California can provide that consistent demand. We can drive down the cost per square foot by at least a third.
David Roberts
Let me ask more about the tax loophole you’re talking about. Californians, I’m sure, will be familiar with this. I’m not sure if the national audience is, but way back in 1978, the people of California, in their wisdom, voted for what’s called Prop 13, which had the effect of freezing — your property tax couldn’t go up more than 2% a year until you sold the property. This has had the effect of rooting people into their homes and buildings, not selling and wildly underpaying property tax revenue.
This is why California is resorting to sales taxes and impact fees and all these other places to get revenue, because they are not getting the property tax revenue that they ought to be getting. This has been crippling California state governance now for decades. What you are after is not repealing the whole thing. It applied to residential and commercial. You are talking about repealing on the commercial side.
Tom Steyer
Yes, I am.
David Roberts
Commercial properties should pay the market rate — they should pay their actual property tax.
Tom Steyer
Yeah.
David Roberts
My question to you is, a ballot initiative with exactly that on it failed in 2020. 2020 was a pretty big Democratic year. It was a Biden year. It was a lot of optimism, et cetera. Why do you think — you can’t, as a governor, just repeal this. It’s got to be either a supermajority of the legislature or a ballot initiative. What makes you think it can get through this time when it failed in 2020?
Tom Steyer
Dave, I don’t know how much you know about my history, but I’ve run three ballot initiatives against oil companies, tobacco companies, and out-of-state companies that weren’t paying fair state taxes in California. Every time people said exactly what you just said to me — “Are you insane? Don’t you know this is impossible?” And I won three times. I did watch the proposition, the ballot proposition in 2020, I did contribute to it. I know we can win this. It’s very clear. We’re going to have to make our case to the voters.
But you know what? We had to make our case to the voters against the oil companies. No one thought we could possibly win. We got 70% of the vote. The original idea behind what was Prop 13 in 1978 was — “We can’t kick Granny out of her house because her house used to be worth $20,000, and now it’s worth $200,000. She could pay the property tax at $20,000. She literally will have to sell her house to pay the property tax, given how much her house has gone up.” That is a lot of unintended consequences, as you pointed out. But Disney is not Granny. Disney is paying their property tax on Disneyland as if they were Granny, and they are very far from Granny.
David Roberts
Yes. All these corporate lawyers have figured out ways of transferring property to one another without ever upselling, without selling it. They’re still paying property tax rates from decades ago.
Tom Steyer
Maybe I could be right about this, Dave. Who knows?
David Roberts
We’ll see if you can persuade the people.
Tom Steyer
I’ve never gotten less than 60% of the vote. This is a very clear — absolutely unfair, unjust — loophole that corporations are taking advantage of and we have to close it. By the way, we need the money. I’m not doing anything unfair. I am closing an egregious loophole that got in there because Granny shouldn’t be thrown out of her house. This is anything but Granny.
David Roberts
All right, got 15 minutes left. I’d love to talk to you about climate change. In your book in 2024 —
Tom Steyer
Thank you. Look at that. My book. That is so good of you.
David Roberts
And I quote, “Climate is what matters most right now. Nothing else comes close.” Then your campaign launch video didn’t say anything about climate. It’s all about affordability, all about energy affordability. This mirrors a larger pivot in, I would say, the Democratic Party — climate has been pushed off the headline into the background and affordability is now on the forefront. I’m curious what you think about that pivot. What do you think about the status of climate change as a live issue right now? Do you agree with the general thrust of the pivot? In other words, do you think it’s appropriate now to talk about affordability instead of climate? How do you think about the relationship of those?
Tom Steyer
You say I’m not using the word climate, but I’m talking about climate change. When I’m talking about breaking the electric monopolies, I’m talking about people putting solar on the roof and batteries in the basement. When I’m talking about getting people off gasoline and tripling the credit for EVs, I’m talking about getting people off fossil fuels and on clean electricity. When I’m talking about housing, I’m talking about cutting down on miles driven. I’m talking about a completely different impact on the world. I’m also talking about getting away from sprawl and leaving natural lands that we need if we are going to have any animals and birds and all kinds of living creatures left on this planet.
I’m not using the word. I’m talking about why this — my book, as you know, was called Cheaper, Faster, Better: How We Win the Climate War. I’m talking about Cheaper, Faster, Better, not about the colon — How We Win the Climate War.
David Roberts
Yeah, I get it.
Tom Steyer
In 2010, we ran — we were No on 23, fighting oil companies to preserve the cap-and-trade system. I ran that with George Shultz. We got 70% of the vote. I told everybody on that campaign, which was about climate at some level, “We’re never using the word climate. If you use the word climate, I’m going to fire you.” They said, “Please, can we use it?” I said, “No. We’re going to talk about the impacts of doing this, the job creation, the health enhancement, getting kids with asthma to be able to breathe clearly, the fact that we have business, half the chambers of commerce supporting us.” We’re doing something that’s good for the people of California right now.
We’re not talking about something 30 years off or 10 years off. The truth is, Dave, people who can’t make rent can’t think about what’s going to happen in five years. “I can’t make rent this month, I can’t make my health care payment this month. My kid is sick. What do you want me to do? I don’t want to think about five years off.”
What I’m doing is I’m talking about climate. I’m talking about climate in the ways that people can hear it, in the ways where we’re giving them something that is good for them right now, but which also has the benefit of moving us to a clean energy economy, including creating incredible jobs and incredible industries and incredible companies that will use new technology to get things done, including what I’m — I’m talking about it all over the place. I’m just not using the word climate.
David Roberts
Let me put a little point on it then, because the cap-and-invest program is California’s big high-profile headline policy. Climate policy used to be cap-and-trade. Now it’s cap-and-invest, just got reauthorized. There are a lot of critiques of cap-and-invest from a lot of different angles. But one of the angles is as a tool for addressing climate change. This operates by raising prices on fossil fuels. It does invest in other things, but it does raise prices on fossil fuels. In other words, it reduces emissions through taxes, which is not very popular right now, especially at a time of affordability crisis.
I wonder if you think that the relative emphasis of the carbon price versus the other tools, if that balance is right right now in this current circumstance. How do you feel about how cap-and-invest came out?
Tom Steyer
I don’t think there’s any choice but to charge polluters. I think that’s absolutely critical. I said I would triple the credit for people to move to EVs. I will drive down electricity prices by pushing for local clean energy alternatives. I want to make sure people’s bills are lower. That’s absolutely true. I think it’s critical. There is always going to be the incentive, as long as there’s one person driving a car, to say, “If we make the oil companies actually pay for the full cost of the oil, that is going to hurt that person.”
I did say this to you, but I’m not sure I really said it in any way that was understandable. I’ll say it very clearly. We are spending $200 billion to protect our oil industry. That’s why we’re in this war in Iran. That’s why the president asked for $1.5 trillion, because we’re now fighting wars. That is money that is going to oil and gas to protect them. That is not in the cost at the pump, last I checked. When I say to you we are subsidizing oil and gas, it’s brutal how much we’re subsidizing and that is our money. That money could go to the education and health care of people in California.
David Roberts
One of the left critiques of cap-and-invest, the way it came out, is that a bunch of oil subsidies — a bunch of oil and refinery subsidies — ended up in cap-and-invest.
Tom Steyer
That was supposed to burn off over time. Let’s talk about climate. As the saying goes, Mother Nature does not care about American politics. The laws of physics are not going to change because of American politics.
The truth is, if you look at the data from the natural world, it’s terrible. It’s incredibly terrible. If you look at the data from the technical world and our ability to get off oil and gas, it’s incredible. What I think is this — we have an absolute issue. We can see it happening. It’s a slow-motion car wreck.
On the other hand, we’ve developed the technologies that are cheaper, faster, and better. But the incumbent political powers are fighting their ass off to keep making money, to keep getting the federal government to protect them with hundreds of billions of dollars a year of military expenditures, not insisting they refuse to pay for the pollution that burns down people’s houses, that raises the cost of home insurance, that causes floods around the United States, that makes the water for farming much more difficult. They don’t want to pay for that. When in fact we have the answers at hand that are cheaper and faster.
David Roberts
Speaking of their political power, there was a big polluter’s pay bill in California just a couple of years ago, and it went down to defeat. Speaking of them fighting their asses off, are you talking about explicitly passing another bill like that, a polluter’s pay bill, a specific charge on —
Tom Steyer
I just want to burn off all the permissions they have to pollute that are part of cap-and-trade. We need to make this transition. The rest of the world is making this transition. No one else in the world is doing what we’re doing. If you look at Africa, Asia, Europe, they’re all burning to make this transition at incredible speed. The costs are going down, the costs are lower. We just happen to have an oil and gas industry that’s got us by the throat and they are fighting like crazy to make sure they can continue to get monopoly rents. Of course, they’re against me.
If you want to wonder who is the person pushing for clean energy, the person pushing against climate change, take a look at the people who are for climate change and who they are opposing. They are opposing me. I am really the only person in this race who has a plan on how to change energy and how to use energy to push us back into the forefront of the fight against climate change while we build big companies, while we drive down costs, and while we assume the kind of leadership that America is always supposed to have, in my opinion.
David Roberts
Final question. You have been involved in the climate fight — good grief, a long time. Now in 2010, as you say, you jumped in with Prop 23, which defended the famous Schwarzenegger climate bill. That started all of everything. In terms of ballot initiatives, that was a hall of famer and that set California in place and dragged the rest of the country along. Back then, you were rolling back the Koch money, you had a quasi-bipartisan coalition behind you. The sense that California was leading.
Today, the waivers are gone, the polluters pay bill died. Everybody’s on the back foot. It just seems a lot grimmer now. I’m curious about your personal reflection on the climate fight. Do you feel we have lost ground, or do you think that is just paying too much attention to US politics?
Tom Steyer
If you look at what the world — what the global action was supposed to be in 2020, we were supposed to reduce emissions by 40%.
David Roberts
Yeah.
Tom Steyer
Do you remember that?
David Roberts
I do.
Tom Steyer
It’s 2026, and the only year that emissions went down was in the COVID year because economic activity went down. We flattened out, but we haven’t gone down. That’s the truth. Therefore, all of the projections about where we were going to be are way off.
If you talk to the scientists, which I’m sure you’ve done, I’m not trying to sound like the font of all wisdom, but if you talk to scientists about when we’re going to hit what the UN described as the upper limit of acceptable — which is 2 degrees Celsius, which no one in the United States even knows what that means, but just for the Americans listening, that’s 3.6 degrees Fahrenheit, the way we think about it. That means the average in the world goes up 3.6% and a lot more in certain places. It pushes us towards tipping points. If you talk to scientists now and you ask, “When do you realistically think we’ll go through 2 degrees?” Before it was 2015. Now it’s probably 15 years earlier.
David Roberts
We’ve fallen behind, and climate change has accelerated.
Tom Steyer
David, in answer to your question, do I feel we’re losing? We’re obviously nowhere near what we said we were going to do, but the technology’s better than anyone ever expected. The world, the climate is worse, the technology is better. Let’s talk about the oil and gas countries. If we want to be like them — we want to be an oil and gas country. We’re the biggest oil and gas producer in the world. We’re Russia plus Saudi Arabia combined, plus some.
Do we want to be like Russia, a very poor country where the people with the guns are very rich? Do we want to be like Venezuela? No. Iraq, Iran? You go through the places, it is the resource curse. The problem with Trump is he thinks that is what riches are.
David Roberts
It seems we do want to be Saudi Arabia. If you pay attention to Trump —
Tom Steyer
Trump thinks — he knows that in those countries, the people with the guns are incredibly rich and everyone else is poor. He doesn’t give a damn because this is a chance for him for real corruption, for real control of energy and therefore real payoffs. No, am I disappointed? That’s what I’m running on, dude, taking on the establishment, the electric monopolies, the realtors who don’t want us to build houses, who don’t want us to work for Californians. I’m the person they’re all going after. Single-payer health care because Californians can’t afford their health care.
Yeah. There’s one person in this race who’s for change and there’s one person in this race who has an actual energy policy that takes climate into account. It’s me. They’re all lining up against me. I ask you, you’re saying, “The climate bill went down and all these things that didn’t work out.” That’s what I’m running for governor for — change. I’m the change agent. The establishment is pushing back — anybody but Tom. Trump posted against me. Elon posted against me.
David Roberts
Did you get a Trump post?
Tom Steyer
Hell yes.
David Roberts
What an amazing break for you.
Tom Steyer
I described it as a love letter. He called me a sleazebag and a loser.
David Roberts
That’s pretty mild.
Tom Steyer
The head of ICE posted against me. I always say in politics, you know who someone is by who their enemies are. That’s a bunch of enemies that I’m glad to have. I’m glad to take on the electric monopolies that are charging us twice as much as everybody else. I’m glad to stick up for working Californians. I can do it. I can take their punches. They’re punching. If I win, everything you say goes the other way.
David Roberts
We will leave it there. Thank you so much for taking the time. Good luck and maybe we will talk again in a few years.
Tom Steyer
Dave, I want you to move down here and vote. Get your ass in gear, dude.
David Roberts
I got problems up here, Tom. We all have things to deal with. All right, thank you so much.
Tom Steyer
Thank you very much, dude.
David Roberts
Thank you for listening to Volts. It takes a village to make this podcast work. Shout out especially to my super producer, Kyle McDonald, who makes me and my guests sound smart every week. It is all supported entirely by listeners like you. If you value conversations like this, please consider joining our community of paid subscribers at volts.wtf, leaving a nice review, telling a friend about Volts, or all three.
Thanks so much and I’ll see you next time.
