The Vermont Department of Public Service (the same entity that served the public by helping to hasten the decommissioning of Vermont Yankee, which means Vermonters will be subject to spot-market pricing for power and increased electricity rates – conveniently timed for after the next gubernatorial election) recently published a study that forecasts 1,800 new jobs in the “clean” energy industry for 2014. The job forecast is based on a poll commissioned by the DPS.
1. “Clean” energy jobs (as if there is such a thing; every erg of energy created has some kind of cost in terms of its generation, either the burning of fuel, the build of solar panels with its well-known collateral environmental impacts, or habitat impacts of hydro generation, etc) are largely funded by taxes, in the form of grants, subsidies, or contracts issued by local, state, or federal agencies. These jobs are not spontaneously born in the marketplace. For the most part, those jobs are created because there is tax money available for revenues. Ask any company that builds wind turbines or solar panels where their dollars are coming from.
In other words, those jobs would not exist without tax money. At best, it’s an economic wash – a transfer payment, not an indicator of economic growth. It’s just a re-allocation of capital, funded by taxes and borrowing.
2. The “clean” energy industry is much more mature in other countries where these energy policies have taken root much earlier than here in the states. So what are some of the longer-term results of those efforts in other countries?
A few examples:
“The first report, which came from a commission of experts that had been appointed by the German parliament to study the country’s energy laws, recommended Chancellor Angela Merkel’s government on Wednesday to abolish all subsidies for green energy which cost the state some €20 billion per year.
It concluded that the current system, in which green power producers are paid guaranteed, above market prices to put electricity on the grid, is financially unsound and not producing a measurable effect on innovation. “For both these reasons, there is no justification for a continuation of the [policy],” it said.”
“The result is a web of grotesque distortions. On sunny days Germany pushes its excess power into the European grid at a loss. Because producers of renewables are paid a fixed price, their subsidy rises as the spot price of electricity falls. On cloudy days Germany relies ever more on brown coal. Last year its CO2 emissions rose.”
“Europe’s electricity system is not living up to its promises, according to a French advisory body to the prime minister, which published a report on Tuesday (28 January) largely blaming renewable energy subsidies for this failure.”
“Whether on low-carbon growth or boosting competitiveness with lower prices – none of the benefits of a common EU electric policy have materialised, the report says.”
Given the examples set by other countries who adopted a “clean energy or die” policy, rushing headlong into the subsidy industry, er, “clean” energy industry,
might Vermont want to take a look at those efforts before committing to having “90 percent of our energy from renewable sources by 2050”, as Christopher Recchia, the commissioner for the DPS, states? (Hell, why not 100%? No one likes a quitter, Chris – you’re either in or you’re out.)
But the DPS report’s research methodologies were sampling, in large part, the industries that are direct recipients of some kind of subsidized dollar of one kind or another. The report itself says that its survey population (10,000 phone calls and 1,200 emails, with a response of 1,464) consisted of “a list of businesses that were identified by Renewable Energy Vermont, various state agencies, and other advisory team members (the “known universe”).”
Well. If you limit your universe to those entities – private, public, and advocacy – that have an enormous self-interest in the propagation of subsidies, do you really expect to get results back from the survey that paint a bleak outlook for “clean” energy jobs in the future? The responses to these inquiries are all going to be positive, because if you paint a negative picture, the likelihood of additional subsidy funding diminishes. It is a self-serving survey. Given the membership of Renewable Energy Vermont, companies that have an interest in promoting renewable energy and seeking more revenues, it’s like conducting a survey about capital punishment by asking death row inmates their opinions on the subject. You’re probably only going to get one answer.
In terms of the state’s job growth outlook, I’m not sure if the DPS has talked with the Vermont Department of Labor’s employment projections, but I’m having a hard time correlating 1,800 new jobs with both the occupations and the number of new jobs that the Department of Labor projects for 2015. Granted, these are two different years, but I would assume DPS does not expect 1,800 new jobs in 2014 to disappear in 2015.
The reason Vermont is rushing forward with clean energy mandates while simultaneously wearing a blindfold is because it’s politically useful to do so. Peter Shumlin has long backed these subsidy regimes, and even with high-profile, epic failures like Solyndra, no planet-sized levels of reality need slow down a political agenda, one that both brings tax revenues (in the form of subsidies) to energy industry companies, and also allows a politician to claim he or she is actually doing something. Once again, the only thing being done is political advancement on the taxpayer’s dime, and there will be no net benefit to Vermonters.
In fact, if countries like France and Germany are running away from energy subsidies as fast as they can, all of our policies and budgets that are devoted to emulating those failed models should immediately be halted and put up for legislative review. Sadly, given Vermont’s politics, that’s about as likely an occurrence as a new nuclear power plant licensing.