Has the clean energy economy arrived?

By Elisa Wood

June 18, 2009

We’ve seen many forecasts that show the clean energy industry boosting future US job growth. But a Pew Charitable Trust study released last week indicates that green job creation isn’t just a thing of the future; it’s been emerging for several years.

From 1998 and 2007, clean energy jobs increased by 9.1%, while total jobs grew by only 3.7% nationally, according to “The Clean Energy Economy.” http://www.pewtrusts.org. In all, clean technology accounted for 770,000 jobs in 68,200 businesses by 2007.

States showed a similar trend.  The clean energy economy outperformed overall job growth in 38 states and the District of Columbia during the same period.

What’s interesting is that the growth occurred before the influx of federal stimulus funds for clean energy. So what will the clean energy job market look like after $85 billion makes its way into the economy? Lori Grange, interim deputy director of the Pew Center on the States,  envisions nothing less than “explosive growth.”

The report also shows that Americans are clearly on board with the idea of pursuing energy efficiency. In 2007, alone, consumers purchased more than 500 million Energy Star® products, up 67% from the previous year.

As the economy recovers, what kind of jobs will the efficiency industry produce?  Expect demand for  workers “who make and distribute software and meters to monitor energy consumption and who manufacture and install efficient glass and lighting, along with service-related jobs that help companies and individuals improve home or business energy use,” the report says.

Regulators see the writing on the wall in New York, which intends to meet 45% of its energy needs from renewables and efficiency by 2015. They are concerned the state will lack enough clean energy workers. So the state public service commission this week approved $6.6 million to train workers for energy efficiency jobs.

The commission described the money as only a “bridge” until it can get federal stimulus dollars to further ramp up training, and said it hopes to avoid “bottlenecks” in programs caused by lack of workers.

True, the clean energy economy has been hurt like all sectors. Venture capital investments dropped in 2008, Pew says. But the downturn appears to be only a dip in what has been – and by all accounts will be — an upward trajectory in clean energy growth for several years.

Visit Elisa Wood at www.realenergywriters.com and pick up her free Energy Efficiency Markets podcast and newsletter.

Where to Find A Green Job?

By Elisa Wood

February 26, 2009

William Carlos Williams began one of his most famous poems: “So much depends upon a red wheel barrow.” Maybe if he were writing today he’d switch ‘red wheelbarrow’ to ‘green job.’

The US is relying on green jobs to push forward economic recovery. Our political leaders promise they are on their way, spurred by $80 billion in stimulus money for efficiency and renewable energy.

But what are green jobs? Who offers them? What training do they require?

Most green jobs are not exotic. In fact, the green job of tomorrow is likely the job you have today (or had before the recession). The product you deliver may be different, but the work is much the same, according to a report issued by the Political Economy Research Institute (PERI).

“The vast majority of green jobs are in the same areas of employment that people already work in today, in every region and state of the country. For example, constructing wind farms creates jobs for sheet metal workers, machinists and truck drivers, among many others. Increasing the energy efficiency of buildings through retrofitting relies, among others, on roofers, insulators and building inspectors,” says Job Opportunities for the Green Economy: A state-by-state picture of occupations that gain from green investments.

Many of the green efficiency jobs are in the building and auto sectors, areas particularly hard hit by this recession. Building retrofits require electricians, heating/air conditioning installers, carpenters, construction equipment operators, roofers, insulation workers, carpenter’s helpers, industrial truck drivers, construction managers, and building inspectors. Manufacturing plug-in electric vehicles and other efficient cars take the work of computer software engineers, electrical engineers, engineering technicians, welders, transportation equipment painters, metal fabricators, computer-controlled machine operators, engine assemblers, production helpers and operations managers.

Many of these jobs are the old blue collar variety. What sets a green job apart is that it supports energy efficiency, renewable energy or some other environmentally beneficial product.

High-tech workers also are likely to benefit from the green boom, especially as the nation begins to create a smart grid, most often characterized as a system that allows your refrigerator and utility to ‘talk’ and save you energy and money. By some estimates the smart grid may create as many as 280,000 jobs in the next five years. As a result, many of the old names in technology are moving into energy, among them Cisco, IBM, Google and Hewlett Packard.

So if you want a green job, you may not have to look too far beyond where you’d find your wheelbarrow. Right in your back yard.

Visit energy writer Elisa Wood at www.realenergywriters.com and pick up her free EE Markets newsletter and podcast.

Energy efficiency’s $1 trillion identity

By Elisa Wood

January 22, 2009

The energy efficiency industry is a bit like the orphan who grows up to discover his long-lost parents left him a fortune.

The industry suffers from an identity crisis, says a report by the American Solar Energy Society. What is energy efficiency? Insulating attics? Demand response? Plug-in hybrids? Led lights? Combined heat and power?

ASES decided to quantify the worth of the energy efficiency job market, so first needed to define the industry. Here is what the organization came up with:

A job in the EE industry consists of an employee working in a sector that is entirely part of the EE industry, such as an energy service company (ESCO) or the recycling, reuse, and remanufacturing sector. It also includes some employees in industries in which only a portion of the output is classified as within the EE sector, such as household appliances, HVAC systems, construction, automobile manufacturing, and others.

The definition also includes those in government, finance, education, non-profit and environmental organizations, education, consulting and similar fields that deal with energy efficiency.

Using this definition the industry’s worth is tremendous. Gross revenues nationwide totaled more than $1 trillion in 2007. Energy efficiency created nearly 8.6 million jobs, more than 98% in private industry.

It is hard to fathom the import of $1 trillion. ASES provides perspective. It exceeds the combined sales of the three largest US corporations: Wal-Mart, Exxon- Mobil, and General Motors in 2007. Their sales were a meager $905 billion.

Beyond the report, why is it important for the industry to proceed with a clear identity? As President Obama moves forward with his “New Energy for America,” many will vie for a prominent position in the plan. ASES makes clear that a coalesced efficiency industry can provide what Obama seeks. Jobs and plenty of them: 29.8 million by 2030 that range from blue collar to high tech.

The industry has found its name–and fortune. Here is the chance to spread it around.

Visit Elisa Wood at www.realenergywriters.com and pick up her free Energy Efficiency Markets podcast and newsletter.

Clean energy, jobs and the real estate market

By Elisa Wood

November 20, 2008

President-elect Barack Obama wants to create five million new green jobs over the next decade. This is a big goal, but in line with what clean energy industry advocates see as possible.

An upcoming international report provides some solid perspective on why green initiatives make for good job building opportunities.

Scheduled for release next summer, “Greening Buildings and Communities: Costs and Benefits,” finds that green buildings create roughly $1/square foot of value in increased employment. A typical green office creates roughly one-third of a permanent job per year. This is done by shifting spending from fossil fuel-based energy to more labor intensive domestic jobs in energy efficiency, renewable construction and new green industries.

A preview of the study, released this week by Good Energies www.goodenergies.com, also finds that green buildings are not as pricey as often believed. They add, on average, about two percent to the cost of a building. Moreover, green buildings reduce energy use by an average 33%. The extra cost of building green usually pays back within five years.

Based on an analysis of 150 green buildings in the United States and 10 other countries, the study is billed as the largest international review of its kind to date.

What good is it to bet on jobs from new construction in this economy? It turns out that green buildings are not falling victim to today’s real estate downturn. Buildings in green neighborhoods are holding value better than conventional homes. On average, sales prices tend to be $20/square foot higher.

“The deep downturn in real estate has not reduced the rapid growth in demand for and construction of green buildings,” said Greg Kats, the study’s lead author and a Managing Director of Good Energies. “This suggests a flight to quality as buyers express a market preference for buildings that are more energy efficient, more comfortable and healthier.”

The report’s findings underscore a growing sentiment that the green energy and efficiency industries are key to economic recovery. What we’ve lost – jobs and real estate values – these industries offer to give back.

Visit Elisa Wood at www.realenergywriters.com and pick up her free Energy Efficiency Markets podcast and newsletter.

And Now for Some Good Economic News: EE Workers Needed

By Elisa Wood
July 10, 2008

With energy demand high and supply tight, the only thing in abundance these days is uncertainty. So says a recent Standard & Poor’s report: “The Credit Impact of Rising Energy Costs on Industry Sectors.”

“Whether energy production can keep up with demand growth is a major question,” says the credit rating agency. “Where the energy will go is easy to estimate. The harder question is where will it come from?” Even if oil prices dip in the short-term, S&P says they are “cycling around a rising trend.”

High energy prices and uncertainty cripple business growth. The auto industry is expected to end 2008 with the lowest sales in 15 years, says the report. The airline industry is squeezed between consumers demanding cut-rate fares and fuel prices that now gobble up as much as 40% of operating expenses. Meanwhile, stores and other retail businesses find customers lack discretionary cash for merchandise.

But buried deeper in the report is some good news, and it is about capital goods aimed at improving efficiency. Specifically, S&P tells the tale of Sweden-based Alfa Laval www.alfalaval.com, a leading global supplier of heat exchanges, pumps, valves and other equipment aimed at improving efficiency in industrial processes.  Company sales are up 50% since 2005. The company’s credit rating has improved because of the demand for energy efficiency products — Alfa Laval saw a one-notch upgrade in April.  S&P says prospects are good for the company because it is stepping up product development and increasing capacity to capitalize on the strong market in the efficiency sector.

For companies like Alfa Laval, the challenge is to “maintain and improve market share, while at the same time keeping control of costs and avoiding over-expansion,” S&P says. The credit-rating agency doesn’t say this, but inherent in this strategy is attracting workers to support expansion.

We’ve heard from industry insiders who say a shortage of workers is becoming a very real problem in the energy efficiency arena. We suspect we’ll hear more talk about this need in the near future as states and utilities ramp up spending on efficiency programs.

Compared with much of today’s bad economic news, worker demand is a good problem to have. But it is a problem nonetheless, and one that requires immediate attention if the industry is to fulfill its mandate as the near-term solution to our energy supply and demand woes.

The solar industry has made clear its need for installers, and policymakers have responded with training programs at community colleges.  What does the efficiency industry need to do to attract the same attention? And will policymakers listen? We welcome your thoughts.

Visit energy writer Elisa Wood at www.realenergywriters.com and pick up her free Energy Efficiency Markets newsletter and podcast.