NEW ENERGY CREATES JOBS - BOGUS SPANISH “STUDY” DISCREDITED

NREL Response to the Report Study of the Effects on Employment of Public Aid to Renewable Energy Sources from King Juan Carlos University (Spain)
Eric Lantz and Suzanne Tegen, August 2009 (National Renewable Energy Laboratory of the U.S. Department of Energy)

"Job generation has been a part of the national dialogue surrounding energy policy and renewable energy (RE) for many years…The report Study of the Effects on Employment of Public Aid to Renewable Energy Sources, from King Juan Carlos University in Spain…asserts that, on average, every renewable energy job in Spain “destroyed” 2.2 jobs in the broader Spanish economy…and [estimates significant U.S.] job loss from renewable energy development and policy…The analysis by the authors from King Juan Carlos University represents a significant divergence from traditional methodologies used to estimate employment impacts from renewable energy. In fact, the methodology does not reflect an employment impact analysis. Accordingly, the primary conclusion made by the authors – policy support of renewable energy results in net jobs losses – is not supported by their work….

"The authors of the King Juan Carlos study…compare the government expenditure per estimated RE job with the average private-sector resources expended per worker and the average productivity per worker…[and conclude there will be] job loss as a result of public investment in renewable energy. This is based on the assumed principle that every dollar spent subsidizing renewables represents a reduction of one dollar in private-sector investment and that every dollar spent in the private sector will generate jobs equally. In contrast, traditional jobs analyses evaluate how changes in demand for specific goods and services will affect economic activity and jobs within specific industries, their supply chain, and the broader economy. The input-output tables applied in traditional analyses are derived from real inter-industry transactions at a specific time…"

This highly-regarded ASES study sees enormous job growth in New Energy and Energy Efficiency. (click to enlarge)

"Fundamental Limitations…The metrics used in the Spanish study are not jobs impact estimates…The comparison of RE jobs with average economy-wide metrics fails to recognize the variability within the modern economy…The report fails to account for technology export potential…The study ignores the role of government in facilitating growth of valued new industries…

"Technical Limitations…The calculation of average capital and average productivity per worker is based on jobs resulting from economic activity at all levels (i.e., it includes direct, indirect, and induced jobs). However, the RE jobs estimate used to calculate the RE subsidy per job is based on a quantification of direct and indirect impacts only…The report relies on jobs estimates that were developed in 2003 and do not reflect Spain’s RE industries in 2009…The report lacks transparency and supporting statistics…"

The U.S. Dept. of Energy predicts wind will provide a half million jobs in the coming 2 decades. It created 35,000 new jobs in 2008 without provoking any job losses. (click to enlarge)

"Shortcomings in Assumptions…The authors assume that a dollar spent by the government is less efficient than a dollar spent by private industry and that it crowds out private investment…The authors assume that results from Spain are reflective of the impact of RE technologies in other countries…The report relies on jobs as the sole metric to assess the value of renewable energy…

"In summary, the analysis performed in this recent study is not a jobs impact estimate…provides little insight into job creation or job loss from Spanish RE policy… has oversimplifications and assumptions that lead to questions regarding its quantitative results…[and fails] to justify their implication that because of the jobs comparison, subsidies for renewables are not worthwhile…[A]n array of benefits besides employment creation [flows] from government investment in renewable energy technologies. Nevertheless, the authors’ basic question regarding whether investment in RE provides a positive or negative employment impact is a fair one…In general, comprehensive analyses show that net employment impacts are sensitive to assumptions regarding future energy prices, strategies for addressing greenhouse gas (GHG) emissions reductions, and the capacity to export technology…[R]ecent research has found that it is only when conventional energy prices are forecast to be very low that net employment impacts from RE investments are negative…Measuring long-term economic and employment impacts is a complex task, sensitive to an array of unknowns, including future prices for both conventional fuel and renewable energy. Because this work is highly sensitive to assumptions and the quality of research, it is critical that policy makers seriously evaluate the work presented to them; and even after careful scrutiny, place jobs estimates within the broader context of energy, the economy, the environment, and the future."