A suggested focus for economic recovery AND decarbonization
By: Nicole Hughes, Renewable NW Executive Director
As the world struggles to flatten the curve of Coronavirus infections, I am reminded of another curve we would be wise to maintain our focus on — the decarbonization curve. While the small improvement in air quality and lowered emissions we have noticed during this time of quarantine is encouraging, it is nothing to celebrate. It does however, shed light on an opportunity as we consider the best way to stimulate our economy toward recovery.
In the coming weeks, we expect our elected officials will begin designing a federal infrastructure spending bill that will rebuild foundational elements of our economy. The choices these leaders make may well dictate whether or not we are able to definitively bend the curve of carbon emissions in a direction that protects the long-term economic and health prospects of our country and the world.
Prior to the Coronavirus outbreak, much of the focus in the electricity sector was on meeting the clean energy goals and mandates that organizations such as Renewable Northwest were instrumental in passing. As with all things, the economic impact of Coronavirus has risked severely slowing the momentum of these efforts. It is tempting during this time of intense hardship to suggest pausing investments in decarbonization. However, the initial allure is quickly dulled when we look at just what is at stake. Hitting the pause button on decarbonization is the absolute last thing we should be doing. We are fighting against the Coronavirus in order that we may once again more freely and openly engage with our communities. The long-term health and livability of the communities we return to must stay top of mind, and decarbonizing the Northwest’s electric grid is key to our long-term success.
While policymakers will be moved by promises of short term raw economic growth opportunities from a variety of industries, it is our view that any infrastructure stimulus package must include measures for maintaining growth in the renewable energy industry, where we have seen consistent growth over the past 10 years. Growth in renewables continued even through the 2008 economic downturn and the years following. In late 2019, the IEA forecasted that renewable technologies would set a record for new generation in 2020. Currently 3.3 Americans are employed in the clean energy sector. This figure outnumbers jobs in fossil fuel industries by 3–1. BW Research recently estimated that as a result of the Coronavirus outbreak nearly 1 million Americans employed in clean energy risk losing their jobs. Jobs associated with one of the fastest growing industries, also supporting our efforts at decarbonization, are the exact type of jobs we need to preserve.
Economic recovery and decarbonization of the electricity sector are far from mutually exclusive goals; they can and must be considered in the same process. With the decarbonization curve in mind, if we focus our stimulus programs on continuing the investment in clean energy, we will both continue to invest in the fastest growing sector and ensure a longer healthier existence for our planet. Additionally, it will secure an energy future not reliant on world markets and environmentally damaging extractive resources. The good news: with economics increasingly favoring renewables, the help this industry needs at this point in time is relatively modest.
In order to accelerate decarbonization of the electricity sector what is most needed is extensions of the deadlines in the current Investment Tax and Production Tax Credits. Extending the life of these pre-existing programs will provide the important signal to investors to continue development of clean energy projects. Without this simple adjustment, we are facing the potential loss of a significant number of jobs as well as economic uncertainty that could affect our industry for years to come.
States play a role in our current crisis as well. Oregon and Washington are currently considering a round of financial stimulus plans to kick start the economy. State leaders should be looking closely at all the investments our states are making to ensure they have decarbonization performance measures, are valuing investments in clean energy infrastructure, and are ensuring the goals and mandates we have in place are still on track to be met. Oregon policy makers need to not lose sight of the greenhouse gas emission goals established in the Governor’s Executive Order. Washington agencies and utilities must also keep their eyes on the planning process for implementation of the Clean Energy Transition Act. Likewise, targeted investments in transmission, electric vehicle charging infrastructure and demand side resources will support development of an electricity grid that is more resilient and able to withstand the pressures of future disruptions to the economy.
Not only is it absolutely possible to have economic recovery AND decarbonization, but in fact, driving decarbonization might be our best shot at reviving the economy. By focusing on renewable energy, we get the best of both worlds: we provide jobs and certainty for our clean energy future, while at the same time keeping the decarbonization curve in the direction it must go. It is yet to be seen what the full economic effects of the Coronavirus will be, but it is well understood that global supply chains and energy prices will continue to be uncertain. With the right leadership and investments targeted at sustainable clean energy infrastructure, we will recover our economy while keeping our eye on the decarbonization curve.