With a state unemployment rate hovering around 7% and the long-term specter of climate change it is easy to understand why many public officials, myself included, tout the potential for green jobs. Training our workforce to perform as solar installers, home weatherizers, etc. helps put people to work while getting us on the path to an energy efficient clean energy economy. Recently, high profile missteps on the state and national level – Evergreen Solar in Massachusetts and Solyndra in California – have lead some to doubt the strategy of investment in energy efficiency and clean energy. These are the wrong lessons to take from these two cases, but there are lessons to learn.
First, as a matter of economic development policy, we should put in place stronger clawback provisions when public dollars are used as incentives to support any business, green or otherwise. In the case of Evergreen, Massachusetts has only been able to recoup a small portion of the investment. If businesses want an incentive from the state, then they must be willing to accept the risk that they will have to repay taxpayers if they do not meet certain goals. This should go for every company that seeks federal, state or local incentives, no matter the sector.
The second lesson is a more positive one: when strong policy is in place and consistent investment is made, clean energy and energy efficiency can be a key component of job growth and economic recovery. Consider this: in 2006 Massachusetts hosted 2 megawatts of solar capacity and 30 solar energy related companies operated in the Commonwealth. Today, 61 megawatts of solar generation is in place, and there are more than 200 companies in Massachusetts’ solar industry, employing upwards of 2,300 people. National firms like Sun Run, Astrum Solar, and Borrego Solar have all opened offices in Massachusetts in recent years, investing and bringing jobs. Local firms have also benefitted. Nexamp of Andover, founded in 2007 with 10 employees has grown to 70, working on all aspects of renewable energy development. Next Step Living of South Boston has grown from 3 employees in 2008 to 180 in 2011, helping them expand their mission of making energy efficiency improvements in homes as easy as possible. From an industry wide perspective, the clean energy sector added 4,036 jobs in Massachusetts between July 2010 and July 2011. That was a 6.7% growth rate, with more than 1/3 of all firms growing, compared to only 13% cutting workforce, in what can best be described as a difficult economy.
None of this happened by accident. Massachusetts, thanks to the leadership of the Patrick Administration and actions of the Legislature, made a commitment to policies promoting investment in clean energy and energy efficiency. Through our membership in the Regional Greenhouse Gas Initiative (RGGI), as well as enactment of the Green Communities Act, the Global Warming Solutions Act, Green Jobs Act, Ocean Management Act, and other steps, Massachusetts has created a stable policy environment, allowing clean energy and energy efficiency firms to thrive and flourish. Yes, Evergreen Solar is a glaring and frustrating failure, but it should not obscure countless other success stories currently putting people to work.
Finally, an important lesson from the Evergreen and Solyndra cases is that the competition to capture the benefits of the clean energy economy is global. Both Evergreen and Solyndra cited competition from China as a driver in their failures. From this some extrapolate that the United States should stop competing for these types of jobs. This response is short-sighted, defeatist, and wrong. We should vie for every one of these jobs, but we must do so nimbly and efficiently. No program or incentive will work as well as it should if fossil fuels continue to be heavily subsidized without a cost placed on their environmental impacts. A stable national clean energy and energy efficiency policy is needed to change the incentives for how we use and conserve energy. Without such a policy, as envisioned by the American Clean Energy and Security Act passed by the U.S. House in 2009, any efforts to transition from reliance on dirty fossil fuels to clean energy and energy efficiency will be plagued by more failures.
Massachusetts’ transition to a clean energy and energy efficiency economy can create jobs and lead our economic recovery. The lessons from Evergreen Solar and Solyndra are that there are still obstacles in making that transition: capturing the economic development benefits in a way that protects taxpayers; global competition; and, our current national energy policy. Overcoming these obstacles will not be easy, but it is imperative if we want to tackle the immediate challenges of creating jobs and ending our reliance on fossil fuels as well as the long term challenge of addressing and preventing climate change.
State Senator Benjamin B. Downing (D- Pittsfield) is in his third term representing the 48 western Massachusetts communities of the Berkshire, Hampshire and Franklin District. He serves as the Senate Chairman of the Joint Committee on Telecommunications, Utilities and Energy.