Clean Energy is a ‘Powerful Engine of Job Opportunity’
Contrary to what EPA chief Scott Pruitt says, investing in clean energy ‘is an enormous source of job creation relative to maintaining our fossil fuel economy,’ says economist Bob Pollin
SHARMINI PERIES: It’s The Real News Network. I’m Sharmini Peries coming to you from Baltimore. This week, the Environmental Protection Agency administrator, Scott Pruitt, announced that the Trump administration intends to roll back the most important environmental and economic policies of our times, the Clean Power Plan. The CPP, as it is known, was to reduce national electricity sector emissions by an estimated 32 percent below 2005 levels by 2030. The CPP was the cornerstone of the United States adherence to the Paris Climate Agreement under President Obama. However, the Trump administration’s withdrawal from both the Paris Agreement and from the Clean Power Plan is expected to be more complicated than Pruitt or Trump would like to admit. For one thing, an announcement of intent is insufficient in the case of the EPA canceling the CPP. That would mean that there will be hearings, a public comment period and most likely a legal battle.
Joining us now to discuss what is at stake here is Robert Pollin. He is a distinguished professor of economics and the co-director of the Political Economy Research Institute at the University of Massachusetts Amherst. He’s the author of several books, including Greening the Global Economy. And he is also the co-author of a recently authored article in the American Prospect titled, A Just Transition for U.S. Fossil Fuel Industry. Bob, it’s good to have you with us.
ROBERT POLLIN: Thank you very much, Sharmini.
SHARMINI PERIES: So Bob, I must mention that you have also co-authored an article in the American Prospect titled, ‘A Just Transition for U.S. Fossil Fuel Industry.’ So all of this gives you a good standing in terms of discussing this issue. So Bob, let’s get down to it. The clean energy sector is the biggest and the fastest-growing energy sector in the US. Tell us about the Clean Power Plan and how it was supposed to work. And in your opinion, was the CPP a potentially effective proposal for reducing emissions and to fight this runaway climate change we are faced with?
ROBERT POLLIN: Well, the Clean Power Plan proposal was, as you said, the single most important measure introduced under the Obama administration in the area of regulation. I would argue that Obama made enormous contributions as part of the stimulus program in 2009 in terms of promoting clean energy investments. But that’s past history.
The Clean Power Plan, as you said, the aim was to reduce emissions, CO2 emissions by 32 percent by 2030. That’s good. That’s good. That is actually fairly modest relative to what is needed in order to get close to a real climate stabilization goal. Nevertheless, it was an important step in the right direction. Now if we do not go through with it, let’s say it’s a total disaster in terms of any kind of climate stabilization policy because it’s not like we can go on forever not trying to stabilize the climate. Every year that goes by that we don’t take sufficient action makes it ever more difficult to ever get to any climate stabilization goal.
SHARMINI PERIES: And Bob, the effect CPP would have had on employment when it’s fully implemented, especially employment in the renewable energy sector, so-called green jobs, give us a sense of what that may have looked like under CPP.
ROBERT POLLIN: The basic point is that investing in clean energy, meaning investing in renewable energy, solar, wind, geothermal, small-scale hydro, and energy efficiency so that we don’t consume so much energy, we can run on less energy, investing in those areas is an enormous source of job creation relative to maintaining our fossil fuel economy. I’ve done studies on this now for a decade, including for the Obama administration. What we found consistently is that investing in green energy generates about three times more jobs per dollar of expenditure than maintaining our fossil fuel economy. So as a source of job creation, a green growth path is a powerful engine of job opportunity.
Now the problem of course is that obviously is not a source of job opportunity for people who have jobs in the fossil fuel sector, such as coal miners. Obviously those jobs have to go away. But those jobs can be handled by giving, creating … Thank you for mentioning the article I wrote. And I’m doing other studies on that now on what we call a just transition for fossil fuel sector workers. Meaning that fossil fuel sector workers should have guaranteed jobs in other areas, re-employment, retraining, relocation, the communities need re-investment. That has to be part of the equation as well. And in fact, Obama had proposed such a measure that was supported and towards the end of his presidency by most Republicans because it would benefit people in the coal industry and those region. Mitch McConnell was against it because anything that Obama was for he was against.
Now keep in mind total number of people working in coal, including everybody, not just the miners, everybody in coal in the United States now is about 66,000 people, 66,000. Our labor force is 150 million. The people in coal represent five one-hundredths of all jobs. We can easily find ways to get these people in the coal industry over time into better situations. That’s what a just transition is about. And just transition is critical in order to make this green power transition something that is favorable all around.
SHARMINI PERIES: Now Bob, do we have a measure of how many jobs are being created in the green jobs sector in comparison?
ROBERT POLLIN: Yeah. So if we were to spend a million dollars in green energy, on average you get 16 jobs. When you spend a million dollars on fossil fuels, including coal, natural gas, and oil, you get five jobs. Five jobs versus 16 jobs, meaning you get three times more jobs per dollar of expenditure by investing in clean energy. But even that, that three to one ratio understates the relative benefits. Because really what happened and is happening is we’re investing in clean energy now, which is creating the jobs. And the jobs losses that will take place over time in the fossil fuel sector are gonna get spread out over 20 years. So it’s not like for every new job we create in clean energy, we lose one in fossil fuel energy.
I’ve been doing studies for the state of New York, the state of Washington. The number of people who actually are gonna lose their jobs per year in either of those states is less than 100 people after we account for people that will be going into retirement. So it’s easy to come up with a just transition plan, as I tried to argue in that American Prospect article.
SHARMINI PERIES: Bob, now let’s turn to what the Trump administration is saying in terms of why they want to withdraw from the Clean Power Plan. So Pruitt in the press release he issued says, “The Trump administration estimates the proposed repeal could provide up to 33 billion in avoided compliance costs in 2030.” If true, what does this mean? And who would avoid the 33 billion in costs? And who would lose that revenue?
ROBERT POLLIN: Look, this is from the official Department of Energy, energy information agency, even under Trump, and I hope they keep putting out factual reports. Right now, if you were to try to set up a electrical generating utility using renewable energy–solar, wind, geothermal, hydro–versus doing it with coal or nuclear actually, this is from the Department of Energy, you are at cost parity or lower cost with green energy versus non-renewable, fossil fuel or nuclear. It is the costs are lower, okay. There are no costs after we of course undergo the transition. There are no net costs. The cost of buying electricity for consumers will be roughly the same or lower. This is coming from the Department of Energy. This isn’t coming from me. The Department of Energy’s own results. There are no net costs.
There are net benefits, obviously, as I said, in terms of jobs. But the most fundamental net benefit is we’ve gotta do something about climate. We’ve gotta do something to stabilize the climate. We really don’t have a whole lot of time in order to do this. And the Clean Power Plan was an important, no inadequate step in the right direction.
SHARMINI PERIES: Now before Trump came to office, and this has been documented by The New York Times, in fact he signed off on a full-page ad by CEOs of the country asking for the U.S. to sign on to the Paris Climate Agreement. And President Trump’s name appears in this ad. This is before he started running for office. Now obviously this is something he agreed awhile back; now it’s not so convenient. So who’s benefiting from this repeal?
ROBERT POLLIN: Well, the people that are benefiting are the people that own fossil fuel assets: oil companies, coal companies, natural gas. There’s really nobody else. I mean, yes, of course the communities, the workers they are affected. We have to take that seriously. So that’s why, as I mentioned, I’m doing a study now with a coalition in the state of New York. I’m doing another study with a very progressive union coalition in the state of Washington, which really takes this idea of just transition quite seriously. Because there will be people hurt. And what Trump and his administration are exploiting is the fact that there will be short-term transition costs, and there will be really damage done to people and communities unless we have a just transition.
But the point is, it’s not hard to enact and implement a just transition. This has to be part of the overall plan. And once we have that, the idea of just transition integrated into a green growth strategy, then the Trumpites can’t make the argument that “Oh, we don’t care about coal workers. We don’t care about their communities.” We do care about their communities. And we care about their communities, and we care about everybody else’s communities. That’s why green growth and a green energy plan with just transition is the only way to go. And by the way, if we don’t do this, if we don’t enact a green growth, what’s going to happen, is happening, is that China’s gonna completely dominate the clean energy market for the next generation, and we will have fewer jobs because we’ll be importing solar plants and wind turbines from China.
SHARMINI PERIES: And Bob, we’ve tackled this issue in previous interviews we’ve done. For people who are in the fossil fuel sector, it’s difficult for them to imagine a just transition. And particularly for the Trump base, there’s a tendency to gravitate to coal and keeping coal jobs, which is obviously unhealthy and not good for the environment and not good for your bodies. So give us a sense of how this just transition works. How do we actually transition people who are working in the fossil fuel industry now?
ROBERT POLLIN: Okay. So, again, as I said, and I shouldn’t give too many details now because we have these studies coming out. And hopefully we can all come back on, we can discuss when the studies come out. But there are groups, really community coalitions that include labor unions, environmental groups, community groups that have worked on these things quite seriously. And I’m a resource person for them.
So what would a just transition look like? First of all, we look at the workers who are involved. And we say, okay, the first set of workers that we’re thinking about are the workers who are near retirement age, old folks like me. So those people we’re saying we will get you a income guarantee into retirement and a pension guarantee subsequent to that. So those are critical things. And what about the people that are not in their 60s or close to their 60s? How many jobs do we need to create? Well, as I said, in coal in the whole country there’s 66,000 people. Basically, so we say some are gonna move towards retirement. So we say there’s 50,000 total, and of those … We’re talking about a contraction of the industry over time. So we’re looking at maybe something like 5,000 people per year that we have to place into new jobs. It can be done. It’s easy to do that. Five-thousand people in a labor market of 150 million. So we have to commit to getting these people new jobs. And we have to say that those jobs that they get will have wages at least at the level of their current jobs.
On top of that, communities. The communities will contract. There will be cost to the communities in terms of contraction. But we have to also realize that there are new clean energy investments coming in. So we need to channel a relatively high share of the new clean energy jobs into the regions where we have high impact. Those are the key elements of a just transition that we’ve worked out.
SHARMINI PERIES: All right, Bob, we’re looking forward to the studies you’re working on to shed more light so that people can imagine what a new green economy looks like. So we wish you all the best with that and look forward to having you back to talk about it.
ROBERT POLLIN: Thank you for having me on, Sharmini.
SHARMINI PERIES: And thank you for joining us here on The Real News Network.