Proposed legislation will generate new jobs, consumer savings and increased Gross State Product in Ohio
- A new economic analysis conducted by the University of Illinois, Yale University and University of California finds that strong federal policy combining standards for energy efficiency and renewable energy and placing a price on carbon could create up to 61,000 jobs in Ohio, while increasing annual incomes by $992 and growing the state economy by $3.7 billion. [1] (These results are consistent with multiple projections by U.S. government agencies.)
Strong federal energy efficiency standards create a powerful economic driver – saving money on energy puts dollars back in Ohio consumers’ pockets, which we can spend on more job-intensive goods and services. Consumer spending generates 70 percent of our Gross State Product, and energy efficiency is the cheapest, fastest way to see a return on clean economy investments.
- Ohio could save over $3.7 billion, creating more than 41,000 new jobs if a federal climate and energy policy with strong energy efficiency standards is passed.[2]
- Increasing energy efficiency (which eliminates waste) improves the bottom line of Ohio businesses and gives Ohio workers an edge in an increasingly competitive global marketplace. For example, Proctor & Gamble, through improvements in energy efficiency throughout its facilities, has reduced its own absolute global warming emissions by 7.6 percent while increasing sales by $37 billion over the past five years.
- Increased performance standards will create new jobs in construction, insulation, engineering and other industrial sectors as well as auditing, commissioning, and financial sector jobs.
- Energy efficiency protects consumers by reducing their energy use and saving them money. Energy efficiency investments generally cost less than half as much as comparable fossil fuel generation capacity and, on a per kilowatt hour basis, are less than half average retail electricity rates, according to Duke University.[3]
Ohio’s dependency on imported energy costs our economy money and security
- Ohio sends $1.5 billion out of state to pay for imported coal – money that could stay at home and grow our economy.
- Placing a price on carbon will encourage development of domestic advanced energy generation.
- With secure, reliable domestic sources of energy, Ohio’s manufacturers can predict energy costs, lowering prices and increasing demand on their products.
Given Ohio’s leadership in clean technology, passing strong federal energy and climate legislation will give Ohio a competitive edge in the emerging multibillion-dollar global industry
- With the nation’s 4th highest clean-energy jobs growth rate, Ohio is poised to capture a leading edge of the clean technology market.
- Ohio’s manufacturing base will receive an infusion of funds. Proposed federal legislation provides $30 billion for retooling and retrofitting manufacturing firms.
- 2,513 Ohio businesses generated more than 35,000 jobs in the clean energy economy by 2007, according to recent economic analysis conducted by Collaborative Economics.[4]
- Between 2006 and 2008, Ohio captured $74.2 million of venture capital investments in clean technology. [5]
- Three Ohio metropolitan areas are in the top 100 places in the country that offer green jobs, according to the U.S. Conference of Mayors.[6]
- Columbus is No. 32. In 2006, the area had 3,938 green jobs. It could have 31,163 by 2038.
- Cleveland-Elyria-Mentor is No. 41. In 2006, the area had 2,952 green jobs. It could have 23,357 by 2038.
- Toledo is No. 85. In 2006, the area had 1,298 green jobs. It could have 10,272 by 2038.
- From 1998- 2007, clean technology jobs nationwide grew by 9.1 percent, while total jobs grew by only 3.7 percent. Despite the financial crisis, experts predict jobs in the clean technology sector will be better protected than U.S. jobs overall.
- On a national level, clean technology is the fastest-growing sector of venture capital investment. $4.12 billion was invested in clean technology in 2008, up 54 percent over 2007.[7]
- Ernst & Young’s Corporate Venture Capital Survey 2008-9 revealed that 44 percent of respondent corporate venturing programs intend to increase their clean technology investments in the next five years.[8]
Without strong U.S. policy, China and India are quickly capturing the emerging multibillion-dollar global clean energy industry
- Uncertainty over U.S. policy is choking growth of this industry here at home. Passing federal climate and energy legislation will create the market certainty needed to spur investment and grow jobs.
- Energy is the largest industry, by revenue, in the world. It represents the next breakout technology sector. Clean energy technology will do for energy, what IT has done for information and communications.
- Worldwide demand for new technologies developed to reduce global warming pollution will create a global market potential of more than $180 billion annually, according to government estimates.
- China is spending $12.6 million every hour on clean energy investment. Only six of the top 30 wind, solar and advanced battery technologies are American.[9]
- By eliminating uncertainty, providing clear incentives and regulatory guidelines, federal policy creates the market signal to spur billions in investment capital, unleash our world famous innovative entrepreneurs and enable our state to help lead the clean energy technology revolution.
Fossil fuel prices have nowhere to go but up. The current economic recession will end, U.S. energy demands will increase, and without action to increase clean efficient energy, our economy will be wrenched by ever-higher more volatile fossil fuel prices
- Over the last few decades we have seen fossil fuel prices fluctuate wildly because of increasing demand and decreasing supply.
- Oil has jumped as high as $140 a barrel – sending prices at the pump upwards of $4 a gallon for gasoline. Coal prices also spiked, with the benchmark Central Appalachian coal hitting $175 per short ton.
- The economic downturn has caused those prices to come down temporarily, but still they remain high — gas prices are 40 percent higher now than in January — and will continue rising once the economy recovers.
- The financial crisis we are experiencing now is in part due to our energy posture, according to high-ranking retired military leaders.
- There are expensive national security implications of relying so heavily on fossil fuels: we send billions of dollars to countries openly hostile to US interests to pay for oil. And because we consume far more than all our reserves, on or offshore, we can never stop that flow of money as long as we are using oil.
Proposed federal legislation protects Ohio industry & jobs[10]
- The American Climate and Energy Security Act (ACES) includes two key provisions supported by a wide array of industry and labor organizations that will prevent jobs from being exported because ACES effectively puts a price on carbon for U.S.:
- Free allowances (approximately 15 percent of the total) to fully compensate U.S. industries that could be disproportionately affected by having to purchase emission allowances, such as aluminum, cement, chemicals, iron and steel, lime, pulp and paper, and many others that use or purchase large amounts of energy and produce products subject to international competition (Inslee-Doyle). The goal would counter pressures to shift production, jobs, and emissions to countries that do not have carbon emission reduction programs.
- A border tax adjustment on imports from countries that have not taken action in these key sectors that will level the carbon cost playing field.
- ACES fully compensates each affected industry sector for its climate change costs.
- During the first 14 years of the program (2012-2025), the bill provides free allowances to affected industry sectors at a level that will ensure full compensation for the costs of direct emissions and the carbon costs of electricity purchases. Plants that directly emit less than the sector average (on an emissions per unit output basis) will benefit by receiving more allowances than they need to cover the added costs of their direct emissions, while plants that emit more than the sector average will receive an added incentive to reduce their emissions.
- ACES grants free allowances to electricity distribution companies that must be passed through to their consumers, including industrial consumers. This mechanism will help all industries and businesses that rely on electricity purchases, not just the heaviest energy users in internationally competitive markets.
- ACES taxes the imports from countries that have not taken action.
- In 2022, the President will make a determination whether he finds that a given U.S. industry sector remains disproportionately affected by prices of greenhouse gas emissions (GHG). ACES authorizes the President in 2025 to stop or slow the phase out of free allowances and/or to establish border tax adjustments to imports from countries that fail to take sufficient action to mitigate greenhouse gas emissions.
[1] UC/Yale/University of Illinois. http://are.berkeley.edu/%7Edwrh/CERES_Web/Docs/ES_DRHFK091024.pdf or Go to top of page link to find press release and links to study.
[2] http://www.aceee.org/energy/national/50states.htm
[3] Nicholas Institute for Environmental Policy Solutions, Duke University, “Transforming Utility and Ratepayer Support for Electrical Energy Efficiency Nationwide,” October 2008.
[4] The Clean Economy Report, 2009. Collaborative Economic; Pew Center on the States. http://www.pewcenteronthestates.org/uploadedFiles/Clean_Economy_Report_Web.pdf
[5] Ibid
[6] http://usmayors.org/climateprotection/documents/Green%20Jobs%20FINAL.pdf
[7] “Cleantech drives through stormy 2008,” February 2009, PricewaterhouseCoopers.
[8] “Record year for US cleantech investments with $4.7 billion raised from venture capital in 2008,” February 2009, Ernst & Young: http://www.ey.com/global/Content.nsf/US/Media_-_Release_-_03-02-09DC
[9] http://www.commerce.gov/NewsRoom/SecretarySpeeches/PROD01_008262
[10] The American Climate and Energy Security Act Protects U.S. Industrial Production and Keeps Jobs At Home: Summary of Competitive Provisions, Center for Clean Air Policy. www.ccap.org