Q & A
Impacts of Comprehensive Climate and Energy Legislation on Florida Jobs, Energy Costs, and the Economy
How will comprehensive climate and energy legislation impact jobs across the country?
- Forward looking, comprehensive energy and climate policy and long-term price signals will create an estimated 1.9 million jobs in America’s new energy economy.1 These jobs are in numerous sectors, including manufacturing, construction, engineering and transportation.
- Investing in a new energy economy will lead the way out of these tough economic times, creating millions of new jobs building wind turbines and solar panels; retrofitting homes and buildings; and retooling automobiles for hybrid and electric plug-in vehicles.
- Fossil fuel industry jobs are a tiny portion of the economy. In fact, renewable energy and energy efficiency create 10 times more jobs per dollar invested2 - investments that stay here in Florida and create jobs.
How many clean energy jobs could be created in Florida?
- New economic analysis from the University of Illinois, Yale University and the University of California shows that by 2020, comprehensive climate and energy policies could create up to 78,000 jobs in Florida.3
Will climate and energy policy cause energy costs to skyrocket?
- No. The Congressional Budget Office projects that the climate portion of the energy/climate bill passed by the House in 2009 will cost the average family less than the price of a postage stamp a day in the year 2020, while studies suggest that the energy efficiency provisions of the bill could save U.S. consumers an average of $215 per household in 2020 and $486 in 2030.4
- Energy efficiency protects consumers by reducing their energy use. Moreover, strong energy efficiency provisions lower electricity demand such that prices will go down for all.
- The Congressional bills protect against negative consumer impacts. In the House bill, for example, electric utilities are required to use their freely-allocated allowances to protect consumers from electricity price increases. The bill also provides rural electric cooperatives with allowances for energy efficiency, renewable energy, and low-income ratepayer assistance programs. Natural gas companies similarly have to use their allowances for the exclusive benefit of retail ratepayers.
How much will this legislation cost consumers in Florida?
- Actually, with strong energy efficiency and renewable energy standards in addition to a price on carbon, comprehensive climate and energy policies will increase Florida’s real Gross Domestic Product by $2.3 billion more than without legislation and lead to average real household income in Florida increasing by $303-$615 annually.5
Meanwhile, coal prices are very volatile, and as the economy recovers and demand increases, prices will likely rise again.
Shouldn't the economy be the top priority? Why act on climate change now?
- Tackling climate change is about the economy. The world is moving to clean energy and a low-carbon economy; the question is whether or not our government paves the way for American businesses to lead the way.
- We are in a global race to build the new energy economy. Millions of engineering, manufacturing and technical jobs are up for grabs.
- China is spending $12.6 million every hour on clean energy. HSBC Global Research estimates that nearly 40 percent of China’s proposed $586 billion stimulus plan – $221 billion over two years – is directed at low-carbon technology investments. This is equivalent to 3% of China’s 2008 GDP. In contrast, the American Recovery and Reinvestment Act includes $112 billion over the next two years, 0.5% of U.S. 2008 GDP.6
- America can choose now to capture the technological edge and become a primary mover in this market, or it can lag and become dependent on others for this energy.
- 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.
- Putting a price on carbon will eliminate uncertainty, provide clear incentives and regulatory guidelines, and deliver the market signal that will unleash innovation and spur billions of dollars in investment capital in clean energy technology.
- According to an analysis conducted by Collaborative Economic for the Pew Center on the States, Florida had 31,122 clean energy jobs in 2007, was home to 3,831 clean energy businesses, and attracted $116,980,000 in venture capital.7
Which is it? Will these policies punish states that depend on cheap and plentiful coal or will it help them make the transition to a low-carbon economy?
- The US relies on coal for a huge portion of its electricity; even if we quickly adopt renewable energy, we will not replace coal soon.
- On a per-capita basis, coal-reliant states are among the top recipients of consumer assistance funding under current Congressional proposals for climate and energy legislation.
- Current climate and energy legislation contains substantial investment for research, development and deployment of technologies such as carbon capture and sequestration (CCS) to help ensure that coal remains viable and to provide a stimulus for new technology development.
- Fossil fuel industry jobs are a tiny portion of the economy. In fact, renewable energy and energy efficiency create 10 times more jobs per dollar invested.8
- Today, the US coal industry employs over 86,000 people.9 Meanwhile, the number of people employed in renewable energy in California alone is 170,000.10
- $1 million invested in the coal industry creates 3.96 jobs; when invested in solar, it creates 5.65 jobs.11
How will these policies impact farmers and agriculture sector?
- There are significant opportunities for the agricultural sector under climate and energy legislation, such as growing biofuels feedstock. Current legislation provides significant support for farmers and ranchers to generate offsets for carbon sequestration practices.
- Recent analysis of the implications of comprehensive climate and energy legislation for the agricultural sector by the University of Tennessee shows that under a properly constructed cap-and-trade program, net returns for virtually all major crops are positive, going up to $13 billion per year.12
- Furthermore, it is important to consider the impacts that not taking action to combat climate change would have on the agricultural sector. According to a June 2009 report from the US Global Change Research Program, inaction will allow climate change to cause significant harm to the southeast, including increased heat-related stresses for people, plants, and animals, decreased water availability, sea-level rise, increased hurricane frequency, and major disruption to native ecosystems.13
How will these policies affect small business?
- Small businesses have great potential for growth in the new energy economy.
- Energy efficiency is a huge economic driver. By saving consumers money on their electric and heating bills, they have more money to spend elsewhere.
- By diversifying our energy supply and improving energy efficiency, small business will be better protected from the volatile swings of fossil fuel prices.
- Small businesses have enormous energy efficiency potential. Every business person knows that efficiency is good for the bottom-line.
1. University of California Berkley, Clean Energy and Climate Policy for U.S. Growth and Job Creation: An Economic Assessment of the American Clean Energy and Security Act and the Clean Energy Jobs and American Power Act, October 2009.
2. University of California Berkley, Putting Renewables to Work: How Many Jobs Can the Clean Energy Industry Generate? April 2004.
3. University of California Berkley, Clean Energy and Climate Policy for U.S. Growth and Job Creation: An Economic Assessment of the American Clean Energy and Security Act and the Clean Energy Jobs and American Power Act, October 2009.
4. Congressional Budget Office, The Economic Effects of Legislation to Reduce Greenhouse-Gas Emissions, September 2009; American Council for An Energy-Efficient Economy, Energy Efficiency in the American Clean Energy and Security Act of 2009: Impacts of Current Provisions and Opportunities to Enhance the Legislation, September 2009.
5. University of California Berkley, Clean Energy and Climate Policy for U.S. Growth and Job Creation: An Economic Assessment of the American Clean Energy and Security Act and the Clean Energy Jobs and American Power Act, October 2009.
6. HSBC Global Research Climate Change, A Climate for Recovery: The Color of the Stimulus Goes Green, February 2009; Center for American Progress, We Must Seize the Energy Opportunity or Slip Further Behind, April 2009.
7. The Pew Center on the States, The Clean Energy Economy, 2009.
8. University of California Berkley, Putting Renewables to Work: How Many Jobs Can the Clean Energy Industry Generate? April 2004.
9. EIA, Average Number of Employees by State and Mine Type Sept. 2009.
10. Environment California, Renewable Energy and Jobs: Employment Impacts of Developing Markets for Renewables in California, July 2003.
11. University of California Berkley, Putting Renewables to Work: How Many Jobs Can the Clean Energy Industry Generate? April 2004.
12. University of Tennessee, Analysis of the Implications of Climate Change and Energy Legislation to the Agricultural Sector, 2009.
13. U.S. Global Change Research Program, Global Climate Change Impacts in the United States, 2009