Early on, Chicago native Jay Precourt's father discouraged him from following in his footsteps in the textile industry. This was OK, because Jay had formed a romantic notion of becoming an oil and gas wildcatter--a vision he "never doubted."

Throughout his high school, university and grad school years, Precourt spent summers working in the oil industry: at refineries, a petroleum research lab, in marketing, on or around drilling rigs and at Standard Oil (N.J.) in New York, helping him understand at an early age the energy business from the wellhead to the trading floor.

His youthful vision was realized in a long and successful career. Until recently, he was chairman and CEO of Hermes Consolidated, a Denver-based private company active in refining, pipelining and marketing. Earlier, he was a president or CEO at Hamilton Oil Co., Tejas Gas Corp. and ScissorTail Energy. Hermes and the latter two were startups that grew to substantial companies under his leadership.
Precourt has served on many nonprofit boards: the Eagle Valley Land Trust, Vail Health Services, The Denver Art Museum Foundation, the Children’s Hospital, Historic Denver, and the Alley Theatre in Houston.

He may be best known currently for his major funding of The Precourt Institute for Energy at Stanford University. With a mission to better national energy policy and technology, the institute’s research projects range from the science and engineering of converting energy from sunlight to electricity, from plants to fuels, and from carbon-based fuels to electricity—-absent carbon emissions-—to improved energy efficiency. It sponsors the annual Vail Global Energy Forum (VGEF).
Precourt received his undergraduate and master’s degrees in petroleum engineering from Stanford and his MBA from Harvard
.

Investor: Why did you found the Precourt Institute for Energy (PIE)?

Precourt: Following operational and financial successes from a series of my startups, I had a strong desire to give back philanthropically. I wanted to be a catalyst to fund ideas that might not otherwise receive attention. Because Stanford had been so influential in my early life, it was natural to consider opportunities there.

An Institute for the Environment existed, but there was no major Stanford focus then on energy. An institute for energy of some kind would have three constituencies: a cleaner environment; industrial efficiency; and increased energy security. The timing was fortuitous, as crude oil prices skyrocketed to a record $147 per barrel.

My biggest surprise may have been how innovative PIE and its centers for energy efficiency, fundamental research, renewable energy and policy have become.

Investor: How have these initiatives grown?

Precourt: PIE and the centers involve more than 20 departments and more than 200 Stanford professors and researchers.
Stanford helped launch an IT revolution—-why not energy technology? A major new natural gas initiative with an extraordinary staff of talented researchers is now also being formed.

The policy center has collaborated with various states to set higher and more workable energy standards for energy consumption and the power grid.

Investor: The Vail event is billed as a forum for conversation and networking. Examples?

Precourt: Representatives for a PIE/MIT energy policy initiative organized by PIE Chairman George P. Schultz presented their joint policy recommendations to Congress. Recently, Colorado Gov. John Hickenlooper, three energy CEOs and the president of the Environmental Defense Fund came together to solve the problem of regulating methane emissions for the benefit of all. VGEF’s networking opportunities established a high bar for serious dialogue in a nonpartisan setting.

Another message was the widespread agreement that the cutting-edge technologies of hydraulic fracturing and horizontal drilling are game-changers. There was unmistakable optimism expressed by many, including former Secretary Shultz and David Danielson, currently assistant secretary at DOE, about the inevitability of new supplies and advances in energy efficiency making North America energy independent within the next decade. The availability of energy exports from North America could also significantly assist Europe in reducing energy dependency on Russia.

Investor: What are the most exciting developments in energy-efficient technologies and renewables?

Precourt: Wind and solar are making great strides. What is equally challenging, however, is that these technologies require a whole new energy infrastructure: DC transmission lines, electricity storage technology and integration into a complex and vulnerable power grid.

The enormity of the energy industry plus growth challenges renewables to make substantial inroads.

Investor: What’s the secret to building a company?

Precourt: With startups, the “secret” was hiring executives smarter than me, slowly and one at a time, while the company grew sufficiently to provide new challenges for the next new hire. Also, giving the others credit for success.

Investor: Your goal over the next 10 years?

Precourt: To see this new energy economy take root—-and to play a part in making it happen.