Looking Globally to Help the Energy Capital of the World

Evan Pruett
The Ends of Globalization
14 min readMay 1, 2021

When running for office, former President Donald Trump promised to defend oil and gas jobs in a time where many were calling for reduced carbon emissions, garnering him a lot of support from those working for the fossil fuel industry (Domonoske). Trump acted upon this promise during his term in office by pulling out of the Paris Climate Accords. Mayors across the country, including Mayor Sylvester Turner of Houston, vowed to keep the Accords and implement a Climate Action Plan (Rotter). And according to Paper City Mag, now “The City of Houston sources 92% of its power from solar and wind energy” (Rotter). There has been pushback against Mayor Turner’s embrace of renewable energy because it is perceived as turning away from what powers Houston’s economy. With many cities following suit and the increased consumer use of renewable energy, the need for fossil fuels across the country is dwindling. Additionally, renewable energy generation sources are needed in order to prevent a large variety of consequences that will result from pollution caused by fossil fuels.

The pushback against Mayor Turner’s embrace of renewable energy is because fossil fuels are a large portion of the economy and create a large variety of jobs in Houston. I live and grew up in Houston, Texas, which is considered the world’s energy capital. I know so many people who work in oil or for energy companies. Throughout Houston, the influence of fossil fuel companies is extremely apparent. Because of this, Houstonians worry that the shift from fossil fuels to renewable energy sources poses a threat to their livelihoods. Many politicians have exacerbated this fear by calling climate action dangerous to the industry that is a large part of Texas’ economy, which they assert would result in the loss of many jobs. While the shift to renewable energy will result in the loss of some jobs in fossil fuels, there will be a creation of many better jobs in renewable energy, and Houston’s economic landscape will remain relatively unaffected. In order to predict how Houston’s economy and jobs will change, the analysis of other countries’ and state’s transition to renewable energy can be analyzed.

I think it is first important to understand why Houston is the energy capital of the world in order to understand the fear easily created around a shift to renewable energy. Houston is located 50 miles from the Gulf of Mexico, and before the discovery of oil in Texas, 17 railroads converged in Houston (World Wide Power). This allows for oil to be easily transported across the United States and the World from Houston. Once oil was discovered in Texas, The Texas Company (now known as Texaco) was offered a cheap price for an office building in Houston and many companies followed them there (World Wide Power Products). Houston remains such a powerhouse in energy because the environment created by a high concentration of companies in a small area allows for an easy flow in business (World Wide Power Products). This environment keeps existing energy businesses in Houston and attracts emerging businesses across the globe to Houston.

The business environment for oil and gas companies created in Houston has generated lucrative amounts of money that has a hold on a large share of Houston and Texas’s economy. Oil and gas is economically lucrative on its own, but in order to understand the full scope of how much it is generating for the economy, the money and jobs generated from pipelines, equipment manufacturing, engineering, and other induced impacts must be factored in. According to an article published in Austin American-Statesman titled “Fact-check: Is the Texas oil and gas industry 35% of the state economy?”, induced impacts include things like “an interior decorator in Houston who is hired by an oil and gas employee” (Mulder). When all things are considered, the oil and gas industry accounted for 30.5% of Texas’ gross state product in the beginning of 2020, which includes a factor of 2.3 for induced economic impact (Mulder). In Houston, “energy likely accounted for around 25 percent of GDP in ’18” (Greater Houston Partnership). So since Houston’s initial economic success was built upon oil and natural gas, and oil and natural gas continue to contribute to a large portion of Texas’ and Houston’s economic output, the move from fossil fuels to renewable energy for some feels like the removal of a cornerstone that could crumble the city and potentially hurt Texas. This feared collapse would theoretically lead to the loss of thousands of jobs in Houston, which could uproot communities and create an exodus of workers to more economically viable cities.

However, oil jobs are already very unstable compared to renewable energy jobs, and renewable energy will create millions of more stable jobs in Texas as Texas’ landscape is prime for developments in renewable energy. Because oil is so lucrative they are able to employ large numbers of people for higher wages but these jobs are volatile. The number of oil jobs often follows boom and bust cycles based on the price of oil, leading to cycling rounds of layoffs. In an interview with NPR, Daimon Rhea, an oil worker, felt like his “life depended on how much that barrel cost” (Domonoske). Petroleum jobs do pay 40% more than the national median (2020 U.S. Energy & Employment Report) which is more attractive when compared to 25% above average clean energy boasts (Muro et al.). But according to labor economist Julia Pollack, clean energy jobs are more stable than oil jobs, following a linear positive trend rather than the fluctuations that characterized oil jobs (Domonoske). This stability and the feeling that working for clean energy is working to save the planet for future generations has attracted some workers, but still so many remain not convinced to work in renewable energy.

Because there has been so much campaigning against renewable energy, fossil fuel workers reject working for renewables, and Houstonans as well as people across the world are apprehensive to make the switch. Most recently, a large amount of false information was disseminated following the winter freeze on Valentines Day in Texas which left many, myself included, without power for days and caused multiple deaths. Tucker Carlson asserted “renewables were to blame” for the power outages, and Texas’ Agricultural Commissioner claimed “the experiment failed big time” when referring to Texas’ use of wind turbines (Farrer). However, according to a press conference from ERCOT, which operates Texas’ power grid, “failures in natural gas, coal and nuclear energy systems were responsible for nearly twice as many outages as renewables” (Farrer). With an event as devastating as the winter freeze, placing the blame on something new is an easy target.

Additionally, a lot of the resistance from fossil fuel workers is fueled by the negative way certain politicians have framed many political actions on climate change. There’s also a lot of money coming from the oil and gas sector going to campaign contributions for Texas Governor Greg Abbott, Texas senators, and House representatives in Houston in order to keep things the way they are. Republican Governor Abbott has taken over $21 million in donations from Oil & Gas (FollowTheMoney.Org). Houston Representative Lizzie Fletcher, a democrat, was the 2nd highest recipient of campaign contributions from Natural Gas transmission and distribution in the House of representatives, Republican representative Dan Crenshaw, the 3rd highest (Center for Responsive Politics). Both Senator Ted Cruz and Senator John Cornyn have received over a million dollars from oil and gas (center for Responsive Politics). No matter the party affiliation, oil and gas has lobbied to keep things the way they are. The rhetoric these Texas politicians push reflects these large donations. Governor Abbott called an executive order from President Biden that would freeze oil and gas leases on public lands a “hostile attack” on the oil and gas industry despite public property rarely being used for drilling (Natario). However, Governor Abbott raised a good point in the same press conference when he said that we can not assume fossil fuel workers can be retrained overnight to work in another part of the energy sector if they lose their jobs (Natario). Some skills do translate while others do not. So there must be a way to make that transition for workers smoother.

Thankfully there are already companies paving the way for programs that can help ex-fossil fuel workers find jobs. Companies like Workrise are working to find jobs in renewables for skilled workers in the oil and gas industry when they lose their jobs (Saul). Workrise also handles payroll and benefits for the workers, and in 2020 was able to find clean energy jobs such as building solar farms or fixing wind turbines for 4,500 workers (Saul). Still, there is a gap in pay between workers in fossil fuels and renewable energy. Workers can expect to make around $50,000 installing solar panels but $10,000 to $20,000 more in a similar fossil fuel construction job (Saul). This is where the Texas and United States government needs to step in. Subsidies for renewable energy companies or benefits for workers in renewable energy could attract workers more and make the transition from fossil fuels easier.

Texas’ neighboring state of New Mexico can be examined in order to see how policies favoring renewable energy may speed up Houston’s transition to renewable energy. An article authored by Constantine Hadjilambrinos of the Department of Geography and Environmental Studies of the University of New Mexico examined the effects of New Mexicos’ renewable energy policies that accelerated renewable energy development. The article, “Renewable energy development as a job creation mechanism: Lessons from New Mexico” found that fiscal policy such as tax credits “resulted in only a few distributed wind and solar installations’’ (Hadjilambrinos). New Mexico’s Public Regulation Commission instead passed the Renewable Portfolio Standard in 2000 “which require that a specified percentage of the electricity that utilities sell comes from renewable resources” (Hadjilambrinos and Shields). The result of the Renewable Portfolio Standard was the building of a 200 megawatt facility, the New Mexico Wind Energy Center (Hadjilambrinos). Facilities like these mean jobs in construction and maintenance for the surrounding area. While there are similar policies in Texas currently, more aggressive policies will expedite the change to renewable energy and create the opportunity to make Houston a leader in renewable energy.

It is actually risky for Houston’s economy to continue to rely on fossil fuels. Because of the nature of the current global oil market, foreign competition can greatly affect Houston’s economy. Houston’s economy is not diversified enough to withstand a collapse in oil prices, a threat that is looming due to competition from OPEC (Mintz). Explained in Evan Mintz’s article “Houston Is Not Prepared for the Oil Bust,” in May of 2020, Saudi Arabia flooded the market with oil in an attempt to undercut Russia, which severely dropped oil prices, oil companies’ revenues, and their employee numbers. Another crash could be catastrophic for Houston and oil workers, far more catastrophic than the adoption of renewable energy. And, by switching to renewable energy, we would be saving Houston’s economy by investing in an industry that is forecasted to be more important in the future.

There already has been extensive research into Texas’ potential for renewable energy generation. A study published in Environmental Policy and Governance analyzing the context of renewable energy deployment in the United States looked into the political and physical potential of renewable energy generation potential. The article “Which Way Does The Wind Blow? Analysing the State Context for Renewable Energy Deployment in the United States” authored by Elizabeth Wilson discovered that “Texas has a significant wind resource, particularly in the Panhandle area, and wind capacity is growing faster here than in any other US state” (Fischlein et. al.). However in contrast to most states and countries with renewable energy generation potential, there isn’t much incentive currently for the transition to renewable energy generation. The same study found that “There is currently no policy in place to create additional demand for wind power and buffer the wind industry from the impact of the extremely low natural gas prices experienced since the development of new unconventional gas resources” (Fischlein et. al.). This may set back Texas and Houston in the future as it is currently difficult for wind energy to compete with the large and established oil and gas businesses. Without the government incentive, it will only hurt workers more because wind energy and other renewable energy companies will not have the funds to create jobs and expand to their full potential.

One additional avenue for an expedited and smooth transition to renewable energy is for already established companies to shift to renewables themselves. That way, the resources they currently possess can be used to undertake large projects that newer renewable energy companies are unable to do. For example, oil and gas giant BP is shifting to renewable energy. BP, headquarters located in London, England, has noticed this change in the world and realized that renewable energy is the way of the future. It’s not just a decision for bettering the planet but also a business decision, “it is making a business wager that low-carbon energy will be a huge part of the world’s future” (Mufson). In order to make this transition BP is investing in renewable energy projects like offshore wind power, solar and battery storage, and electric car charging kiosks (Mufson). Massive companies like BP shifting to renewable energy will be extremely important to the transition from fossil fuels because of the resources they have. These companies have the money to support job retraining and to undertake large and difficult projects that no start up company can do. With large companies turning to fossil fuels and other companies working to find jobs for oil and gas workers, the transition seems more and more possible. But how can Houston carry out the transition? What will it look like once it’s all said and done?

Thankfully we can take out a lot of the guesswork out by examining the transitions that other countries underwent. By looking at these countries, we can find out why they made certain decisions and determine whether these decisions will work for Houston. For example, Iceland transitioned from being reliant on imported fossil fuels to deriving nearly 100% of its electricity from renewable sources (Logadóttir). The transition began with innovation and exploration in renewable energy by local entrepreneurs who found ways to utilize the abundant geothermal energy present in Iceland. Shortly after, Iceland’s government created incentives like their Geothermal Drilling Mitigation Fund which made it more economically viable and less of a risk to explore and use renewable energy (Logadóttir). Iceland also developed hydroelectric power at a large scale (Logadóttir). It could be argued that Iceland’s transition is a rare case due to the abundance of geothermal energy and could not be comparable to Houston. However, Houston is surrounded by large open land that could be utilized for wind power and is very close to the Gulf of Mexico which has the potential to generate wind and hydroelectric power. The economic incentives and policies that Iceland enacted can be used as a road map for Houston and Texas to begin the transition and make it a reality.

Another similar circumstance is the Asturias region of Spain. A region historically reliant on coal, is now making the transition to renewable energy. In a study done by researchers at the University of Oviedo showed that “the obtained forecasts show that the development of renewable energies will have an outstanding effect on employment, thus compensating the gradual losses in employment in the traditional mining industries” (López et. at.). One of the most interesting things discovered by this study is that most of the jobs created correspond to construction and installation, not maintenance which would be a more direct parallel to fossil fuel jobs in the energy sector (López et. at.). But there would be jobs needed to plan and execute projects and jobs “related to economics, management and administration” (López et. at.). Therefore there are a wide range of jobs that are not initially thought of when considering the shift to renewable energy that are necessary and available. The study concludes that “future government policies and private initiative should adopt strategies to satisfy the requirements of the energy sector, including the training of future workers, thus improving regional competitiveness and generating positive effects on the regional labour market” (López et. at.). In a perfect world, there would be one job in the renewable energy sector for every worker who loses their job in fossil fuels. This isn’t the case, but there will be a wealth of jobs and opportunities created nevertheless. Also, this transition will not happen overnight. There will still remain the need for oil and gas workers until enough renewable energy generation is put in place, and eventually jobs capping oil wells and petroleum manufacturing until more sustainable alternatives are found.

Houston has experienced a wealth of climate disasters in recent history. From Hurricane Harvey to the Winter Freeze of 2021, and at this rate of climate change, climate disasters predicted to become more frequent and worse. This fact, along with the economic benefits seen from switching to renewable energy, have led to increased urgency for a transition to renewable energy generation sources from fossil fuels. The shift is possible and could become a reality if Texas can enact policies similar to those enacted across the globe to incentivize the change. In his interview with NPR, Damien Rhea added that his former colleagues in the oil and gas industry who are mad at renewable energy are like “mailmen getting mad at email, times are changing. You have to adapt” (Domonoske).

Works Cited:

Center for Responsive Politics. “Natural Gas Pipelines: Top Recipients Members of the House.” OpenSecrets.org, Center for Responsive Politics, 2020, www.opensecrets.org/industries/recips.php?ind=E1140&cycle=2020&recipdetail=H&Mem=Y&sortorder=U.

Center for Responsive Politics. “Sen. John Cornyn — Texas.” OpenSecrets, Center for Responsive Politics, 2020, www.opensecrets.org/members-of-congress/john-cornyn/industries?cid=N00024852&cycle=2020.

Center for Responsive Politics. “Sen. Ted Cruz — Texas.” OpenSecrets, Center for Responsive Politics, 2020, www.opensecrets.org/members-of-congress/ted-cruz/industries?cid=N00033085&cycle=2020.

Domonoske, Camila. “Oil Jobs Are Big Risk, Big Pay. Green Energy Offers Stability And Passion.” NPR, NPR, 21 Oct. 2020, www.npr.org/2020/10/21/925504343/oil-jobs-are-big-risk-big-pay-green-energy-offers-stability-and-passion.

Farrer, Martin. “US Conservatives Falsely Blame Renewables for Texas Storm Outages.” The Guardian, Guardian News and Media, 17 Feb. 2021, www.theguardian.com/us-news/2021/feb/17/conservatives-falsely-blame-renewables-for-texas-storm-outages.

Fischlein, Miriam, et al. “Which Way Does the Wind Blow? Analysing the State Context for Renewable Energy Deployment in the United States.” Environmental Policy and Governance, vol. 24, no. 3, Wiley Subscription Services, Inc, 2014, pp. 169–87, doi:10.1002/eet.1636.

FollowTheMoney.org. “Abbott, Greg.” FollowTheMoney.org, 2018, www.followthemoney.org/entity-details?eid=11281947.

Forster, David. NASEO & EFI, 2020, 2020 U.S. Energy & Employment Report, www.usenergyjobs.org/.

Greater Houston Partnership. “Economy at a Glance — August 2020.” Houston.org, Greater Houston Partnership, 17 Aug. 2020, www.houston.org/houston-data/economy-glance-august-2020.

Hadjilambrinos, Constantine. “Renewable Energy Development as a job creation mechanism: Lessons from New Mexico.” Journal of Research and Innovation for Sustainable Society, vol. 1, no. 2, THOT Publishing House, 2019, pp. 36–43, doi:10.33727/JRISS.2019.2.5:36–43.

Klump, Edward. “ECONOMY: Houston: An Energy Capital Looks to Evolve.” ECONOMY: Houston: An Energy Capital Looks to Evolve — Thursday, May 31, 2018, 31 May 2018, www.eenews.net/stories/1060083017.

Logadóttir, Halla Hrund. “Iceland’s Sustainable Energy Story: A Model for the World?” United Nations, United Nations, Apr. 2013, www.un.org/en/chronicle/article/icelands-sustainable-energy-story-model-world.

Mintz, Evan. “Houston Is Not Prepared for the Oil Bust.” Texas Monthly, 10 Mar. 2020, www.texasmonthly.com/news-politics/houston-not-prepared-oil-bust/.

Moreno, Blanca, and Ana Jesús López. “The Effect of Renewable Energy on Employment. The Case of Asturias (Spain).” Renewable & Sustainable Energy Reviews, vol. 12, no. 3, Elsevier Ltd, 2008, pp. 732–51, doi:10.1016/j.rser.2006.10.011.

Mufson, Steven. “Big Oil’s Green Makeover.” The Washington Post, WP Company, 20 Sept. 2020, www.washingtonpost.com/climate-solutions/2020/09/15/bp-climate-change-transition/?utm_source=google&utm_medium=acq-nat&utm_campaign=eng-hub-search&utm_content=hub-climate_soultions&utm_keyword=&campaignid=8202785432&adgroupid=111150677210&adid=504274061467&gclid=Cj0KCQjwvYSEBhDjARIsAJMn0lhDN9WPz8pB8Dh_vCXeIY1930hHRLFEBgWwF0sraV_2bzZ71LhHmggaAgCIEALw_wcB.

Mulder, Brandon. “Fact-Check: Is the Texas Oil and Gas Industry 35% of the State Economy?” Statesman, Austin American-Statesman, 22 Dec. 2020, www.statesman.com/story/news/politics/politifact/2020/12/22/fact-check-texas-oil-and-gas-industry-35-state-economy/4009134001/.

Muro, Mark, et al. Brookings, 2019, Advancing Inclusion Through Clean Energy Jobs, www.brookings.edu/wp-content/uploads/2019/04/2019.04_metro_Clean-Energy-Jobs_Report_Muro-Tomer-Shivaran-Kane.pdf#page=16.

Natario, Nick. “Houston in Position to Create High-Paying Jobs in Alternative Energy, Expert Says.” ABC13 Houston, KTRK-TV, 28 Jan. 2021, abc13.com/houston-jobs-industry-renewable-energy-are-there-any-in/10101833/.

Charles Rotter. “Houston Ranks №1 in America in Renewable Energy Use — No, Really.” Watts Up With That? [BLOG], Newstex, 2020.

Saul, Josh. “This Company Helps Roughnecks Find Renewable Energy Jobs.” Bloomberg.com, Bloomberg, 1 Mar. 2021, www.bloomberg.com/news/articles/2021-03-01/renewable-energy-jobs-for-oil-and-gas-workers-exist-workrise-is-finding-them.

Shields, Laura. State Renewable Portfolio Standards and Goals, National Conference of State Legislatures, 7 Mar. 2021, www.ncsl.org/research/energy/renewable-portfolio-standards.aspx.

World Wide Power Products. “Home.” New Used Generators Ends and Engines Houston TX Worldwide Power Products, www.wpowerproducts.com/news/why-did-houston-become-energy-capital-of-the-world/.

--

--