The clean-energy industry is one of the America’s fastest growing employers, and one of the industries with the greatest long-term potential, given a global market that is fated to grow throughout the coming century.
But it is being dealt a body blow by the Covid-19 crisis, and it is beginning to look like it’s not going to get any help from the federal government, at least not until next year (and then only if Democrats win big). Fossil fuels, on the other hand, are getting everything they ask for.
Doubling down on a polluting industry in decline, while allowing a burgeoning domestic industry to wither, is incredibly short-sighted and self-defeating. But it’s happening. And it illustrates yet again the asymmetry between America’s political parties, in terms of who they fight for and how hard they fight, what they consider fundamental and what secondary.
Republicans have declared that helping clean energy industries is a silly luxury during a pandemic, while helping fossil fuels is a hard-nosed necessity. And Democrats are letting them get away with it.
The clean energy industry, one of America’s most promising, has taken a gut punch
Before the Covid-19 crisis struck, renewable energy was one of America’s fastest growing industries, surging 100 percent between 2000 and 2018. In 2019, solar represented 40 percent of all new electricity generation capacity in the US, the fastest growing sector, expanding an average of 48 percent a year for the last decade. Wind power has more than tripled over the last decade and is now the nation’s leading source of renewable generation, providing more than 20 percent of power for six states (three of which, Texas, Oklahoma, and Kansas, are solidly Republican) and sending more than $1 billion in tax revenue to local governments.
In 2018, the wind industry supported more than 114,000 jobs across the US; the solar industry employed 250,000. As of 2019, wind technician and solar installer were the two fastest growing jobs in the US. The energy efficiency sector employs 2.4 million Americans. According to Advanced Energy Economy (AEE), advanced energy overall supports 3.5 million jobs in the US, “more U.S. workers than retail stores (3 million), twice as many as hotels and motels (1.7 million), and more than three times as many as the coal and oil industries combined (1 million).”
Clean energy has been one of the great success stories of the US economy over the last decade or so — mainly sparked by the Obama stimulus bill. But the industry relies heavily on in-person projects and installations, and the Covid-19 virus and subsequent lockdown have dealt it a body blow. The latest numbers reveal that in March alone, the clean energy sector shed 106,000 jobs — a year’s worth of job gains, gone in a matter of weeks.
According to analysis and projections by the BW Research Partnership, “the clean energy sector has or will lose more than a half-million jobs — or 15 percent of its total workforce — in the months ahead if no additional actions are taken to support the industries.”
The Center for American Progress has a new report rounding up the damage Covid-19 is doing to clean energy in the US. It is grim.
Residential solar installations are down 40 percent. Market analysts at Wood McKenzie recently lowered their yearly outlook for solar capacity deployment by 18 percent, more than 20 gigawatts. The Solar Energy Industries Association (SEIA) projects that some sectors, especially residential solar, could lose up to half their jobs.
The American Wind Energy Association (AWEA) projects that in coming months, 35,000 wind-power jobs could be lost, 25 gigawatts worth of new projects put at risk, and $43 billion in investments in rural communities jeopardized.
The electric vehicle (EV) industry, which employs 200,000 Americans, has a less developed supply chain than gasoline vehicles and will be particularly hard hit by the economic freeze. A Wood McKenzie analysis expects sales to fall 43 percent this year, as auto sales overall drop by 30 percent.
Energy efficiency projects, especially residential projects that rely on face-to-face contact, are being cut back across the country, leading to widespread layoffs. In the energy storage industry, 63 percent of respondents to a recent survey expected canceled projects and lower revenue this year.
And so on down the line, with all the industries at the forefront of the clean energy transition. They do not have the scale and deep political ties of their fossil fuel competitors; especially in energy efficiency and residential solar, the biggest employers, the market is filled with small mom-and-pop shops. If the economic freeze goes on as long as some are now projecting, they could be wiped out en masse.
The industry’s requests are modest
In a better world run by people of greater wisdom, the US would use the lockdown in part to prepare, to ensure that when the economy gets going again, it does so on a cleaner, more just and sustainable trajectory. (I wrote a long post about what that might look like.)
Typically in recessions, carbon emissions and air pollution decline, but then snap back or even increase when the economy recovers. Smart planning on the part of policymakers could accomplish economic stimulus without the typical surge in emissions, by pouring money into clean energy research, development, and deployment, setting a date to ban the sale of new internal combustion vehicles, preparing a massive national jobs program focused on retrofitting buildings to run on clean electricity, prohibiting new fossil fuel development, and putting a price on carbon.
In this fallen world, however, the clean energy industry’s asks are fairly modest. It wants deadlines extended for federal tax credits; many of those credits are set to expire this year, and if projects are delayed by even a few months, they could miss out.
The industry would like the tax credits extended at least through the crisis, if not longer, and expanded to cover energy storage, geothermal, and waste-to-heat energy. (Senator Ron Wyden of Oregon has sponsored a bill that would do all this.)
Finally, it would like tax credits converted into direct cash payments — at least for the time being, while tax equity is difficult to come by.
Better, more reliable tax credits would meaningfully boost the industry through a difficult time. And in the grand scheme of things, given the trillions of dollars being thrown at the economy and the trillions more likely to come, fully funding clean energy tax credits would be a rounding error in the federal budget.
Republicans are fighting to help fossil fuels and hurt renewable energy
Trump and the party he leads make no bones about what side they are on: they are for fossil fuels and against renewable energy.
It doesn’t matter that some of the biggest renewable-energy states are Republican; it doesn’t matter that the industry employs people in every red state; it doesn’t matter that voters, including majorities of Republicans, support clean energy. Fossil fuel executives are the ones writing the checks and funding the astroturf groups. They’re the ones in the room when decisions are being made. They’re the ones with longstanding social, political, and financial ties to politicians at every level of the party. So it is their interests that are defended.
In the last round of stimulus negotiations, Trump and Senate Majority Leader Mitch McConnell both intervened to prevent clean energy from getting support. McConnell mocked the industry’s requests as “dusting off the Green New Deal.” Trump said stuff like this:
This is not about the ridiculous Green New Deal. It is about putting our great workers and companies BACK TO WORK!— Donald J. Trump (@realDonaldTrump) March 24, 2020
That tweet, like Trump’s recurring, hallucinatory accusations against wind power, makes no sense on its face. Renewable energy companies are real companies that employ real people, losing real jobs. Tax credits are a tiny, technocratic policy relative to the sweeping reforms of the Green New Deal. Trump didn’t begrudge casinos, airlines, or real estate developers stimulus money. Why this?
It makes more sense when viewed in the context of a long-running war on renewable energy that the Trump administration has been waging since it came into office. CAP Action has a report compiling the administration actions that have cost renewable energy jobs — repealing the Clean Power Plan, imposing solar tariffs, blocking the extension of clean energy tax credits, slashing clean energy agencies and budgets, stifling the development of renewable energy on public land, and more — and concluding that they have led, cumulatively, to “the loss or suppression of at least 622,000 jobs in the renewable energy sector.”
As Geoff Dembicki reports for Vice, there are even now several fossil-funded advocacy groups working to prevent any aid for the renewables industry from entering into any stimulus bill. The groups often invoke “free markets” when support for renewable energy is on the line, but the GOP has no such scruples when it comes to supporting oil & gas.
The administration is gutting fuel economy standards, which by its own estimation will increase pollution and eliminate 13,500 jobs a year. The EPA has dramatically eased enforcement of pollution regulations and moved forward with its “secret science” rule, which will make it more difficult to understand and address the health impacts of air pollution — and will constrain the federal government’s ability to investigate a Covid-19 virus.
Despite a glut driven by historically low prices, the Interior Department is rushing to lease federal land for oil and gas development, despite anemic response, rock-bottom prices, and calls from conservative and taxpayer groups to suspend leasing in the face of the virus.
Just this week, EPA administrator Andrew Wheeler announced that the administration, in defiance of an enormous body of evidence and the recommendations of EPA scientists and staff, would not tighten restrictions on soot pollution.
The administration seems determined to bail out struggling shale gas companies, despite that overleveraged, debt-ridden sector being long overdue for a shakeout. (For more on that, check out Amy Westervelt’s reporting on Drilled.) Trump is out negotiating with Saudi Arabia and Russia on oil supply cuts, and has his Department of Energy buying up billions of tons of oil for the Strategic Petroleum Reserve, all to try to boost the price of oil to help struggling oil majors. A group of GOP senators is lobbying for fossil fuel companies, including coal companies, to be eligible for the small-business recovery fund.
There’s no mistaking the pattern in this extraordinary solicitude toward fossil fuel industries. The Republican Party has, in practice and in rhetoric, declared itself: it supports fossil fuels and will work to block the transition to clean energy.
It has asserted, against all logic, that the extraordinary steps it has taken to protect fossil fuels are necessary, while any help for the renewable energy industry — which helps reduce respiratory illnesses that increase vulnerability to Covid-19, reduce the cost of energy, and reduce the greenhouse gases that are driving the next crisis — is some sort of frivolous political gambit.
And the Democratic Party, forever unwilling to declare itself, seems to have accepted this absurd framing.
Democrats won’t champion clean energy the way Republicans champion fossil fuels
As Adam Aton and Benjamin Storrow report for E&E News, “House Democrats have mostly stopped insisting that emergency relief bills address climate.” (Their headline: “Virus response excludes climate. Get used to it.”)
Why have efforts to address climate change fallen out of the conversation? Because in the first round of stimulus negotiations, Republicans forced Democrats to choose between aid for health care workers and assistance to renewables. Given that choice, Democrats rightly addressed the emergency need.
But why should that be the choice? Why shouldn’t Democrats insist on both? After all, Republicans need the stimulus bill more than Democrats do — their guy is in charge and must answer for the results. Democrats had, and have, leverage. Why won’t they use it?
“A bigger concern,” Aton and Storrow report, “is how Democrats can insist on cutting emissions without appearing to stall economic recovery.”
And therein lies the rub. It is the same core issue identified in this excellent Politico piece by Michael Grunwald, the great chronicler of Obama’s stimulus. It’s not that Democrats don’t have leverage, Grunwald says. It’s just that they are unwilling to use it. “We’re terrified that we’ll look like obstructionists,” one Democratic congressional aide told him.
It is worth pondering that for a moment. From the moment they were able to the very last minute of his presidency, Republicans in Congress blocked everything Barack Obama tried to do through legislation — everything, including desperately needed additional economic stimulus in 2010. Did they ever once express any fear of being seen as obstructionists? Did they ever once pay any political price for being obstructionists?
No, and no. They recognized that, with Obama in charge, voters would blame him for partisan fighting and gridlock — and they had the power to generate endless partisan fighting and gridlock.
With Trump in charge, Democrats don’t seem to have the same confidence. They have talked themselves into being scared of the scolding of DC pundits, of what Republicans will say about them, of their own shadows, of everything. They have simply accepted the fact that, if it comes to a messaging battle with Republicans, they will lose, so better not to risk it.
It is maddening. Voters are worried about the election and want universal access to mail-in voting (which should be Democrats’ bottom-line demand). They love the post office and want the Postal Service protected. And they support a massive green stimulus that would fight recession and climate change at the same time.
These are broadly popular policies. The only place they look like liabilities is in the hothouse atmosphere of DC media and cable news shows.
NEW: I wrote about the attacks on climate advocates and the Green New Deal during CARES Act negotiations, and how environmental organizers are planning to shape future stimulus bills https://t.co/VtU3RHZcDE— Rachel Cohen (@rmc031) April 9, 2020
Until and unless they win big in the 2020 elections, this is the last time Congressional Democrats are likely to have substantial leverage. They are in a position to block a bill that Republicans desperately need. They can secure popular progressive policies if they are willing to stand united against bad-faith Republican attacks.
If they signal in advance that they aren’t willing to do so, that they will allow Republicans to define what is and isn’t in bounds for a stimulus bill, they give Trump free rein. Their leverage will decline with each subsequent stimulus bill and Republicans will have no incentive at all to back down. “As long as Democrats are terrified of looking like obstructionists,” Grunwald writes, “Trump won’t have to worry about obstruction.”
That’s inexcusable for a party that claims to believe what the Democrats claim to believe. Climate change isn’t going to wait. It’s not “the next crisis,” it’s already happening. As Abrahm Lustgarten reports for ProPublica, climate-driven disasters like hurricanes, floods, and fires are almost certainly going to strike while the virus still has everyone in lockdown. If physical distancing is difficult now, what will it be like in the face of a wildfire or a flood? Where will people evacuate in a hurricane?
Multiple concurrent crises is likely to be the new normal in the 21st century. The US desperately needs to become more resilient — in its governance, its social safety net, and its emergency response — while reducing the emissions that are accelerating the crises. Part of that is escaping dependence on fossil fuels by standing up clean energy industries to scale.
Preparing the US economy for what’s to come is not some nice extra, a decoration to hang on a stimulus bill. It is fundamental to securing the long-term stability of US democracy. Democrats in Congress need to act like it.