Our latest guest on the podcast is a household name in the green community and corporate sustainability movement. Boardroom Alpha sat down with Neha Palmer, CEO of privately-held Terawatt Infrastructure.
Palmer has been at the epicenter of electrification since her days as Head of Energy Strategy at Google (GOOG, GOOGL). As the tech giant’s first hire focused on data center energy, Palmer built and led the team developing electric infrastructure and electricity procurement for its global fleet, covering dozens of sites over four continents. She was instrumental in helping Google become 100% renewable and the largest corporate renewable energy buyer in the world [although Amazon (AMZN) eclipsed that achievement last June]. She left Google to become CEO of Terawatt, an exciting startup company in the commercial electric vehicle (EV) charging space.
In addition to heading up Terawatt, Palmer also serves as a Director at Go Green Investments Corp. (GOGN), a pre-deal SPAC focused on the sustainability space. Listen to the podcast to hear Neha explain what happens to the grid when massive companies like Amazon (AMZN) decide to go electric, how her board experience has made her a better CEO, any why tech needs more women in the conversation.
Terawatt’s business is very much aligned with ESG (environmental, social and governance) mandates. The company is purpose-built to focus on large-scale electric vehicle charging infrastructure for fleets of medium and heavy-duty vehicles. Fleet vehicle depots are complex. They will need to incorporate not only charging stations, but energy management systems, and energy storage and on-site generation. These sites will also require massive amounts of power capacity, and in turn, close coordination with local electrical utilities. Many fleet operators are turning to third-party companies like Terawatt to manage all these elements as part of a turnkey charging service.
Electric vehicle charging networks are making headlines lately, bolstered by strong EV demand and the Biden administration’s $1.2 trillion infrastructure plan. In addition to sector bellwether Tesla (TSLA) which has built out its own charging infrastructure, a growing list of startups, mostly SPAC IPOs, have focused on building out passenger EV charging networks. These include Chargepoint (CHPT), Blink Charging (BLNK) and EVgo (EVGO), among others.
Terawatt’s mission is different from this cadre of passenger EV charging networks. Medium and heavy duty class vehicles are expected to electrify faster than passenger vehicles. The reason is simple: there’s a much lower per-mile cost, or TCO (Total Cost of Ownership) for medium and heavy-duty fleets going electric. So when operators make the decision to electrify a fleet, they have a bottom line business incentive to make this transition as quickly as possible. Ultimately, the motivation behind some of the biggest logistics companies in the world — Amazon (NASDAQ: AMZN), Fedex (FDX) and UPS (UPS) — to electrify their supply chains boils down to economics.
More than just lip service: Energy consumption is terawatt-sized secret
In a world in which ESG performance is driving corporate reporting and decision making, it’s worth noting that Amazon won’t disclose how much energy it uses. Google, Apple (AAPL), Facebook (FB) and Microsoft (MSFT) all publish annual reports detailing their carbon footprints, electricity use, and overall energy consumption.
In 2019, amidst rising pressure, Amazon finally revealed its carbon-dioxide emissions, which totaled about 44.4 million tons in 2018. Last June, the company reported that its emissions jumped by 15% over the prior year to about 51.1 million tons. That means Amazon’s emissions are nearly as high as Chevron (CVX), which emitted 60 million tons of CO2 in 2019. For its part, the company says it’s on a path to operating via renewable energy by 2025 and to be net-zero carbon by 2040.
On the flip side of the carbon-neutral equation are cutting-edge companies like EV maker Polestar (GGPI), which is working to build an electric car entirely free of emissions. For more details on how Polestar is working toward being carbon neutral throughout the entire automotive cycle (including recycling its own parts!), check out our February podcast with Polestar CEO Thomas Ingenlath.
Bottom line: companies like Terawatt, working toward a green energy future, will be interesting to watch—particularly if they can achieve what Palmer calls the “double bottom line” — profitable growth and an ESG mandate. Here’s what Palmer had to say about women in tech, how Terawatt is aligned with a sustainability focus, and how board experience makes for a more empathetic CEO.
On women in tech
So yeah, we have a lot of work to do in this space, in tech, and energy. I started off my career as an engineer. I was a banker. And certainly I would sometimes be the only woman on the team. And I think that’s still persists today in many places. And so, for me, it’s something I think about a lot because I think that the diversity brings a better perspective, and you actually have better results as a company. There’s lots of statistics out there that say, if you have 50% of the executives in your company that are women, you actually have better financial results. You know, I think one thing I’ve noticed now that I’m hiring very aggressively is that women like working for women. And so if you have women in the senior ranks, you’re actually able to pull more diversity in here.— Neha Palmer, CEO of Terawatt Infrastructure
On aligning a business with ESG mandates
I think we are seeing, you know, there’s been lots of talk for many years about this double bottom line, the ability to actually create value, but also create this with the ESG aspect to it. And so I think [investors] are looking for that double bottom line. I don’t think anyone would invest in ESG, just because it’s an ESG investment. They really want to make sure that it’s something that will create value for their investors and individual investors as well. So, it’s about creating a profitable company that has a great product…but definitely doing it in a responsible manner. So, they’re looking for the companies that are able to thread that needle and provide both of those aspects.— Neha Palmer, CEO of Terawatt Infrastructure
On how Palmer’s role on a Company board has influenced her as a CEO
I was a director before I was a CEO sitting on this side of the table. There’s certainly a level of empathy that you might not have without that. So certainly, I think you realize [that] there’s a lot of things that happen inside of a company that you have purview to. So that is a definite perspective that I’ve gained. I do think it’s made me a better CEO, I’ve been able to be at the table for a couple of different entities and see how they’ve navigated these issues that have crept up or opportunities. And so I have that in my back pocket now…[based on] that sort of experiences that I’ve had. And it’s really valuable to actually have gone through that before I sat in the seat. So certainly, that empathy, though, is something that I really didn’t realize.— Neha Palmer, CEO of Terawatt Infrastructure