The American Solar Energy Society (ASEA) reported a staggering forecast of “37 million jobs resulting from Renewable Energy and Energy Efficiency in the US by 2030”. That’s pretty exciting stuff. In fact, the numbers are so big, I had to get a closer look. 37 Million new jobs would certainly fix things in this, or any, economy.
I know from having lived in Colorado that there is a lot going on there because there are 300 sunny days a year, so it’s a great place for solar power projects. Many businesses like the Whole Foods company and other large retailers have projects going on and the Federal Center is putting in major solar power arrays to reduce their electrical demand . The National Renewable Energy Labs are in Golden Colorado, near Denver, and they have huge campuses with thousands of people working on all sorts of energy related topics. Public Service, the local power company has major wind farm projects going on in the state. And there are major wind testing facilities that have recently sprung up to support the wind industry in Colorado.
So as part of measuring the impact of Renerwable Energy and Energy Efficiency activities, the report from the American Solar Energy Society focuses quite a bit on the local Colorado situation. I have heard that Colorado claims to have 10,000 new jobs in the renewable energy arena. There is a long way to go to get from 10,000 jobs to 37 million. More importantly, the report states that 5600 of those jobs are at NREL and other government or non-profit organization, like ASEA. I don’t think you can count jobs that are paid for with taxes, they don’t produce revenue.
The methodology of the report includes under it’s definition of Renewable Energy category of business; wind, photovoltaic, solar thermal, hydroelectric, geothermal, biomass (ethanol, biodiesel, biomass power), fuel cells and hydrogen. That’s pretty broad by itself.
Then the Energy Efficiency businesses include; appliance, HVAC, insulation, automobile and other. So on a statistical basis some of the appliance and HVAC businesses, which already exist, get counted for a certain amount of head count and revenue generated because portions of their product sales focus on energy efficiency. Wow! That means you can count a small percentage of almost everything else. Personally, I don’t consider guys putting insulation into your home part of the emerging green economy. But the folks at ASES do.
And jobs that are federal, state or local government that are related to renewable energy are counted as well. Non-profits, trade associations, foundations, consultants, investment, and other related positions are all in the count if they are related to Renewable Energy or Energy Efficiency.
So there is a huge gap between estimating the “impact” of the green economy and job creation based on the green economy. Looking at the report from ASEA, they are clearly not the same thing. If 56% of measured jobs in Revewable Energy in Colorado are in the government and non-manufacturing roles, then the claims for job creation can not be more that 4400. And the size of the “green” job creation opportunity is significantly lower than the announcement would lead you to believe.
Worse still for the US economy, one of the dominant suppliers in wind power is Siemens, which means that a lot of the sales generated here, translates to revenue for Europe. In the solar cell market Japan, Germany and China supply the majority of the market and several foreign suppliers have operations in the US.
We sure hear a lot about how the green economy is going save our economy. I think some of the messages are exaggerated and taken out of their proper context. The analysis needs to be based in terms of what we can really expect in Growth.