Clean Energy Jobs for All

Kyle Gracey, Natural Resources Industry Lead — PreScouter, Inc., NLC Pittsburgh

Clean energy jobs are on the rise. A steady stream of research shows the clean energy industry now employs several million people, far more than the fossil fuel industry. But how diverse are these jobs? Who benefits most from them? And what about those left behind by the clean energy transition? In short, how can we protect and expand this job creation, while ensuring it benefits everyone? This memo summarizes key policy opportunities to support equitable clean energy job creation.

The Clean Energy Jobs Landscape

First, a review of where we stand. By one early 2017 estimate from the Department of Energy, there are already two and a half times more clean energy jobs in the United States than there are fossil fuel jobs[i]. Among wind and solar, energy efficiency and clean energy storage, there are 2.8 million jobs. In contrast, extracting and processing coal, oil and natural gas employs about 1.1 million Americans. If hydropower and nuclear jobs were added to the renewable energy number, the difference would be even more striking.

The main activities driving these changes are clear. Coal’s contribution to total energy use fell nine percentage points in the past five years (23% in 2007 to 14% in 2016)[ii]. Natural gas partially made up for this, growing seven percentage points (23% to 30%), while renewables grew by over three and a half percentage points (6.5% to 10+%). In March and April 2017, for the first time renewables collectively produced more electricity in the United States than nuclear[iii]. Simultaneously, energy efficiency companies are delivering results. In 2016, the economy grew by 1.6%, but energy use decreased by 0.2%, continuing a multi-year trend. In addition, decades of automation in the fossil fuel industry, compared to the relatively young renewable energy industry, means that it takes more jobs to create the same amount of clean energy. Put another way, investing money in clean energy creates more jobs than spending it on fossil fuels. Regardless of the model or whether we look at financial investment or electricity production, clean energy creates two to three times more jobs[iv] [v] [vi].

Equity in Job Creation

But who gets these jobs? As the Department of Energy study summarizes:

These energy-related sectors are relatively less diverse compared to the overall national workforce. Women are a smaller portion of the workforce in these sectors, ranging from 22 to 34 percent, compared to the overall economy, where women make up 47 percent of the workforce. The percentage of ethnic and racial minorities is slightly lower than the national average for Hispanic or Latino workers (14 percent versus 16 percent) and Black or African American workers (eight percent versus 12 percent).

The report also notes age imbalances, with older workers taking more jobs than younger workers, even though Millennials are now the largest demographic and are working age[vii]. Only veterans come out better than in the overall economy. This author’s own research into the equity of job creation found a similar imbalance[viii] [ix]. White, middle-aged males tend to hold a disproportionate number of the jobs in these studies, compared to their overall share of jobs in the economy. Even within other age groups, men stand to disproportionately gain from job creation.

The good news? First, while not exactly “good”, fossil fuel jobs are just as unequal. Fossil fuels and clean energy tend to employ a lot of the same types of people, particularly construction laborers and factory assembly line workers. Second, since clean energy companies employ more people in total than fossil fuel companies, there are more jobs for everyone, even if some races, genders and ages will gain more than others. Last, geographically the gains are at least fairly equal. The clean energy economy has brought gains to almost every state. Only nine states[x] have more fossil fuel jobs than clean energy jobs, and even here the balance is shifting. Even coal-heavy Appalachian states like Kentucky, Tennessee and Pennsylvania have more clean energy employment.

Still, job creation should be both robust and equitable. Below are a number of policies that could support this.

Policies to Support Inclusive Job Creation

Clean Energy Growth

The clean energy industry creates more jobs than the fossil fuel industry. While both industries are less equitable job creators than the overall economy, the clean energy industry creates more jobs in total across all races, genders and ages. Policies that support the clean energy industry will mean more jobs for everyone. These should include:

• Stronger renewable portfolio standards at the state level to move electricity generation to cleaner sources. More than half of the country already has some type of requirement for how much renewable energy should contribute to electricity generation[xi]. Half a dozen states increased their standards in the past year.
• Long-term Federal tax credits, especially production tax credits, for all forms of renewable energy and energy efficiency. Federal production tax credits for wind and solar are in effect through about 2019. But tax credits for other renewables and for energy efficiency expired in 2016 and Congress has not renewed them. More importantly, the tax credits have often been short-term, lasting as little as a few weeks to a few years. Companies need long-term assurance that credits will be in place when making decisions about what energy projects to invest in. Credits should last for at least 5 years.
• Expand Property Assessed Clean Energy (PACE) to more states and localities. PACE allows building owners to finance renewable energy and energy efficiency upgrades by paying for them over several decades as part of their property taxes[xii].
• Develop Federal and State legislation or regulation to steadily eliminate greenhouse gas pollution. No single policy would do more to expand clean energy jobs faster. Despite new roadblocks at the Federal level toward regulating greenhouse gases, a few states, particularly California, are advancing new or updated laws and regulations specifically to limit or put a price on greenhouse gas pollution. The Northeast Regional Greenhouse Gas Initiative helped cut power plant carbon dioxide pollution 40%[xiii] while adding 30,000 jobs[xiv]. Still, the vast majority of states have no specific greenhouse gas laws.

This is just a sampling of possible policies. Importantly, states, cities and municipalities have many options available to advance local clean energy job creation, even if progress stalls at the national level.

Diversity Growth

Several policies exist to improve the diversity, and not just the total number, of clean energy jobs. In one sense, the answers are often straightforward. Many have been known for years, since they support more inclusive job creation, whatever the job. On the other hand, they suffer from the same challenges that plague other policy areas–a lack of implementation:

• Gender-inclusive work policies. Laws that make it easier and more equitable for women to participate in the economy, and for men to care for children, will help balance the gender gap not just in clean energy, but across the economy. Many of these are well known, if not as well implemented, and include support for childcare, paid family leave, comprehensive reproductive and sexual health care and insurance, and equal pay. Companies don’t need to wait for state or federal action, of course–they can offer these policies themselves.
• Improve clean energy demographic data. We can’t improve what we don’t measure. Currently, clean energy jobs data is scattered across academic papers and government databases. The 2010 stimulus package provided funding for the U.S. Bureau of Labor Statistics (BLS) to specifically collect “green jobs” data, including both clean energy jobs and other environmentally sustainable careers[xv]. However, the 2013 sequester cut funding for this program. Even when the program was operating, it did not plan to collect demographic data. The recent Department of Energy study is a valuable set of data, but decision makers and stakeholders need ongoing information. BLS should restore its green jobs program and add demographic information. States could also benefit from picking up where the federal government left off. Equitable job creation is in their interest, too. Likewise, most academic jobs studies don’t include demographic information. This should change.
• Provide skills training, nontraditional education and education-to-work opportunities. Many clean energy jobs require new skills compared to fossil fuel jobs. Providing wide access to the education necessary for these positions will ensure that more groups of people will have the knowledge to be hired. Traditional four-year colleges and graduate degrees are one route. Here, affordable public universities and diversity-focused scholarships will help. However, many of the skills necessary for these positions can be gained through community colleges, vocational-technical schools and other education-to-work programs. Community and vocational colleges have long asked for funding and support to help them train clean energy workers[xvi]. Legislators should tie this support to accountability standards for these programs. For example, the program curriculum should teach the material necessary to earn relevant industry certifications, and ideally include real work experience[xvii].
• Share insights from leading cities. A number of cities and other municipalities are leading the charge to more inclusive economic growth in clean energy. Indianapolis, Portland, San Jose and New York recently joined a program to share data on how they are supporting inclusive growth, with clean tech a major focus of their efforts[xviii]. From investing in urban manufacturing centers, building inclusion metrics and inclusive stakeholder processes into investment decision, to providing tax credits and other incentives for companies to hire local workers in more diverse communities, these cities are leading the way and learning from each other. More programs like Equitable Innovation Economies, which serves as a platform for these four cities to share resources, are sorely needed.

Just Transition

Part of creating more inclusive jobs requires that we find new jobs for workers displaced by the massive shift to a clean energy economy. A so-called “just transition” depends on a combination of its own set of policies and some of the policies already discussed:

• Workers will need retraining and transition support, whether through colleges, vocational schools, or their new employers. Those companies and educational institutions will need funding to develop and offer that training. For example, in Kentucky the Mountain Association for Community Economic Development recently began paid retraining and hiring of laid off coal company employees to become state energy efficiency auditors and perform other energy contracting services for the state[xix]. Many of the employees were already electricians, so the retraining makes use of skills they already possess. The Appalachian Regional Commission finances the effort.
• Displaced employees will also require temporary wage and benefit support while they retrain, which may go beyond the levels already provided by public assistance. Retraining could be a condition for receiving these benefits.
• Communities will need new sources of employment as fossil fuel infrastructure shifts and shuts down. Some of this can come from clean energy. But since fossil fuels and clean energy resources are not always located in the same places, communities will need other types of support and guidance to help diversify their economies. Many communities lack local experts in economic planning, or can’t afford outside consultants. Importantly, communities need to have these resources available or in place before a plant or a mine closes. Effective transition planning can take months to years, and some job losses happen suddenly, with only weeks or months notice.
• Public Private Partnerships can help transform temporary government support into long-term jobs for displaced workers. For example, in Kentucky, the company Bit Source used federal support for Appalachian economic development to kick-start a program paying displaced coal miners to learn computer coding. Bit Source then hired the former miners to complete projects for its clients[xx].
• Corporate Power Purchase Agreements (PPAs) present a non-policy options that can help drive renewable energy development. PPAs are long-term contracts between power providers and large buyers, such as a single company. They provide dedicated funding to develop new (renewable) energy sources, while helping companies secure predictable energy rates for one to two decades. To support a just transition, companies can prioritize renewable energy providers who will site their projects in areas experiencing declining fossil fuel employment.

Support for a just transition will require financial investments from federal and state governments and employers. But the costs of unemployment and inequality are arguably far greater.

Conclusion

The clean energy economy is already a major job creator in this country. The transition away from fossil fuels is likely to accelerate. A wide variety of clean energy, inclusion and just transition policies exist to support these changes, driving robust, diverse job creation. Many success stories already exist. But without a greater focus on the benefits of the clean energy economy, and a commitment to sharing those benefits with all Americans, governments at all levels risk leaving their citizens behind.

[i] Sierra Club. 2017. “Report: Clean Energy Jobs Overwhelm Coal, Oil & Gas in 41 States and D.C.” Accessed July 15, 2017. https://en.scribd.com/document/343243328/Sierra-Club-Clean-Energy-Jobs-Report-Final-1.

[ii] Business Council for Sustainable Energy. 2017. “Sustainable Energy in America Factbook.” Accessed July 15, 2017. http://www.bcse.org/sustainableenergyfactbook/.

[iii] Bosson, Kenneth. 2017. “Solar Now Third Largest Renewable Source of Electricity in US. Renewable Energy World.” Renewable Energy World. Accessed July 15, 2017. http://www.renewableenergyworld.com/articles/2017/06/solar-now-third-largest-renewable-source-of-electricity-in-us.html.

[iv] Garrett-Peltier, Heidi. 2017. “Green versus brown: Comparing the employment impacts of energy efficiency, renewable energy, and fossil fuels using an input-output model.” Economic Modelling 61:439–47. Accessed July 15 ,2017. doi: 10.1016/j.econmod.2016.11.012.

[v] Kats, Greg. 2016. “How many jobs does clean energy create?” GreenBiz. Accessed July 15, 2017. https://www.greenbiz.com/article/how-many-jobs-does-clean-energy-create.

[vi] Dorn, Andrew. 2009. “The Labor Intensity of Energy.” Illinois Institute of Technology. Accessed July 15, 2017. http://www.kentlaw.edu/faculty/fbosselman/classes/energysp09/Coursedocs/The%20Labor%20Intensity%20of%20Energy.pdf.

[vii] Gunaratna, Shanika. 2016. “Millennials reach U.S. population milestone.” CBS News. Accessed July 15, 2017. http://www.cbsnews.com/news/millennials-surpass-baby-boomers-us-census-data-largest-living-generation/.

[viii] Gracey, Kyle. 2013. “Green Jobs: Who Benefits? Demographic Forecasting of Job Creation in U.S. Green Jobs Studies.” In Building a Green Economy: Contributions from Ecological Economics, edited by Robert Richardson, 171–209. East Lansing: Michigan State University Press.

[ix] Gracey, Kyle and Davidson, Michael. 2012. “Youth, Green Jobs, and Gender.” Accessed July 15, 2017. http://www.academia.edu/1242939/Youth_Green_Jobs_and_Gender.

[x] Texas, Oklahoma, Louisiana, West Virginia, Wyoming, New Mexico, North Dakota, Alaska and Kansas

[xi] Barbose, Galen L. 2016. “U.S. Renewables Portfolio Standards.” Lawrence Berkeley Laboratory. Accessed July 15, 2017. https://emp.lbl.gov/projects/renewables-portfolio.

[xii] PACENation. 2017. “PACENation.” Accessed July 15, 2017. http://pacenation.us/.

[xiii] Acadia Center. 2016. “The Regional Greenhouse Gas Initiative Status Report: Measuring Success.” Acadia Center. Accessed July 15, 2017. http://acadiacenter.org/document/measuring-rggi-success/.

[xiv] Paul Hibbard, et al. 2015. “The Economic Impacts of the Regional Greenhouse Gas Initiative on Nine Northeast and Mid-Atlantic States.” Analysis Group. Accessed July 15, 2017. http://www.analysisgroup.com/uploadedfiles/content/insights/publishing/analysis_group_rggi_report_july_2015.pdf.

[xv] Bureau of Labor Statistics. 2011. “Measuring Green Jobs.” United States Department of Labor. Accessed July 15, 2017. https://www.bls.gov/green/.

[xvi] American Association of Community Colleges. 2017. “Top Federal Priorities for Community Colleges.” Accessed July 15, 2017. http://www.aacc.nche.edu/Advocacy/Pages/federal_priorities.aspx

[xvii] Marsh, Akil. 2017. “Utilizing distributed solar goals as a tool to promote workforce development and diversity in cities.” Unpublished draft.

[xviii] Kumar, Tanu, Levers, Annie, Schildt, Chris and Alexis Stephens. 2014. “Prototyping Equity. Equitable Innovation Economies Initiative.” Pratt Center. Accessed July 1, 2017. http://prattcenter.net/eie/strategies/.

[xix] Mountain Associaton for Community Economic Development. 2016. “MACED Receives $2 Million from the Appalachian Regional Commission to Support Economic Transition in Eastern Kentucky.” Accessed July 15, 2017. http://www.maced.org/ETEK-announcement.htm.

[xx] Bit Source. 2017. “Remake Learning: From Deep Coal to High Tech: How Coders are Remaking Appalachia.” Accessed July 15, 2017. http://www.bitsourceky.com/news/remake-learning-deep-coal-high-tech-how-coders-are-remaking-appalachia.