The U.S. could add hundreds of thousands of jobs if Congress requires that part of the nation’s electricity be derived from renewable sources. That is the conclusion of a study by Navigant Consulting that was presented on Thursday.
If utilities were required to produce 20% and 25% of their energy from wind, solar and other renewable sources, between 191,000 and 274,000 jobs would be created, according to the study. The study also found that the U.S. would lose renewable energy jobs in the years ahead if such a renewable-energy standard would not be implemented.
The Navigant Consulting study confirms European success stories that show that governments can play an important role in speeding the transformation of the current economies based on polluting fossil fuels into sustainable renewable energy economies. Take the example of Germany. Germany is today the country with the most installed solar panels, whereas Germany is clearly not the country with the most sunshine. The success of the introduction of solar panels and other renewable energy instruments is a result of the German Renewable Energy Act.
The key point of this act is that all new renewable energies have absolute priority at a guaranteed price in the electric power market. Whatever renewable energy is produced must be taken by the grid and must be taken by the whole electric power service. The conventional energy companies have no possibility to block it.
Interestingly, the Germans did not set a minimum standard – as the Navigant Consulting study – is suggesting. They only dictated that whatever renewable energy would be produced, had to be bought by the utilities at an agreed price. This simple act has created a lot of new investment and jobs and has made Germany a leader in solar energy. The German approach has already inspired similar programs in Egypt, China, India, Brazil, Argentina and France.
The architect of this German success story was Hermann Scheer, member of the German parliament, a former minister in the German government and the president of Eurosolar, the European Association for Renewable Energy.
In a recent interview in Ode Magazine’s special Climate Change issue, Scheer argues that governments should also support the transformation to a clean energy economy through tax policies: “Renewables should be given tax exemptions. That would automatically change the investment decisions of energy producers and the behavior of consumers. It is a fact that conventional energy harms the climate and human health. Therefore it is ridiculous that these ‘poisoned’ energies are cheaper than clean energies. It must be exactly the contrary. Clean energies must be cheaper. And one instrument to accomplish this is to introduce tax exemptions and tax reductions for clean energies and increased taxes for conventional energies. This would provide incentives for producers and consumers to shift to renewable energies.”
The shift to renewable energy requires government intervention. That is not something that comes easily in the U.S. But as the German example shows, it is a healthy way to create jobs and a greener environment without wrongful distortion of the market mechanism. It is the way to go, not only for America but also for the whole world.