Jennifer Granholm – Secretary of Energy
Public service shouldn’t be a boon to government officials’ bank accounts, yet Jennifer Granholm has held on to millions of dollars of stock for a company the President and his Administration are actively promoting.
When questioned, Secretary Granholm indicates she might hold on to the stock for as long as six months after her confirmation date. Is this the ethical standard the public should expect going forward as Congress prepares to hand trillions of taxpayer dollars to build a renewable energy infrastructure system and fund related R&D?
Jennifer Granholm is the current Secretary of Energy. She was previously a two-term governor of Michigan, a CNN political commentator, and held several profitable board memberships and consulting roles. One such board membership is Proterra Inc., – dubbed the “Tesla of electric buses” – which is currently being promoted by President Biden himself as a likely beneficiary of his renewable energy agenda. Fortunately for Granholm, another former client is Media Matters, a non-profit organization that has since defended her continued ownership of Proterra investments in the face of media scrutiny and Capitol Hill demands for investigation.
Governor of Michigan
Granholm served as Governor of Michigan from 2003-2011. During her tenure, she led efforts to provide state taxpayer funds to selected companies in the electric vehicle and other renewable energy sectors. One company, Renewable and Sustainable Cos., was headed by a paroled convict who had previously gone to prison for embezzlement but was able to join then-Governor Granholm on stage to tout the supposed benefits his company would provide. Ultimately the company failed and the founder was sent back to prison after receiving over $9 million in tax benefits from Michigan. Many other companies that received investments under Granholm’s administration also went bankrupt and failed to provide either the jobs or revenue they and Grandholm promised the taxpayers.
Private Sector Consulting and Board Memberships
Granholm earned considerable income from serving on several Boards of Directors and providing consulting services to organizations such as American Bridge PAC and Media Matters.
Granholm was a member of Proterra’s board of directors from 2017-2020. She also holds as much as $5 million in stock in the company. Upon being nominated for Secretary at the Department of Energy, she signed an Ethics Agreement that required her to both step down from Proterra’s board – along with any others she was serving on – as well as divest all Proterra stock she owned. On April 6, 2021 she signed a document listing the stocks she had divested, but Proterra’s was not among them.
Biden’s Department of Energy
President Biden formally announced his intention to nominate Jennifer Granholm to be the next Secretary of Energy on December 18, 2020. The U.S. Senate voted 64-35 to confirm her on February 25, 2021. The day before, on February 24, 2021, President Biden signed Executive Order 14017 which instructs the Secretary of Energy to lead efforts relating to the supply chains for batteries and other materials for electric vehicles. Specifically, the order states that “The Secretary of Energy, in consultation with the heads of appropriate agencies, shall submit a report on supply chains for the energy sector industrial base (as determined by the Secretary of Energy).” Secretary Granholm is also required under the order to “submit a report identifying risks in the supply chain for high-capacity batteries, including electric-vehicle batteries, and policy recommendations to address these risks.”
It is unclear whether Secretary Granholm has discussed these and other similar duties she will be asked to perform with DOE’s ethics officials to ensure there is no potential for a conflict of interest. Even beyond a divestiture, how will Secretary Granholm be able to work on these matters without financially benefiting Proterra, the so-called “Tesla of electric buses?”
The President’s involvement with Proterra has meant both increased public exposure and potential for financial returns for shareholders as the company prepares to go public. On April 20, President Biden virtually toured the Proterra’s facility in support of the Administration’s policy of using electric buses to replace fossil fuel buses. Days later, on April 27, Granholm affirmed in an interview that she has still not divested her Proterra stock. Given Granholm’s former position with Proterra and her ownership of its stock, the President’s choice to tour the facility after directing Granholm to report on national supply chains for electric vehicle batteries raises questions about what influence she or DOE played in arranging the visit.
Moreover, it easily stands to reason that a visit by the President of the United States to a company’s factory would have a positive impact on the company’s ultimate stock price once the company goes public. Some have even estimated that the current infrastructure bills being promoted by Secretary Granholm and President Biden could mean as much as $174 billion to green vehicles and $45 billion to zero-emission buses. Does Secretary Granholm plan to hold the stock options until after Proterra has gone public? Has she been granted a waiver to work on electric vehicle issues given the strong potential for a conflict of interest or public perception of an appearance of bias on these matters?
Carrying out both of the directives assigned to DOE in President Biden’s Executive Order would involve Granholm making recommendations to the White House that could provide financial benefit for Proterra. Each day that the Department of Energy works to enact these initiatives is another day when Granholm’s stock options could increase in value as a result of her policy decisions. This not only presents clear questions of a conflict of interest between Granholm and Proterra but is the precise type of arrangement that has so damaged the public’s trust in their government officials.