Abbey Exec Summary, Pa Green Jobs Status Report

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  • 1. 2009 Pennsylvania Green Jobs: Status Report Kevin Abbey 10/13/2009
  • 2. Green Jobs: What they mean? Why we care? Why we need them? Green Jobs offer a possibility -- a restorative possibility. By that I mean the opportunity to engage people in work that fulfills the need for self reward while at the same time an opportunity to do work that invests in the future well-being of the community. Green Jobs exist at this intersection between “What’s in it for me?” and “How can I help my neighborhood, my community?” Simply stated, green jobs are more than just a job. Green Jobs can be defined by the five (5) Es:  Efficiency – jobs that increase the efficient use and conservation of energy – whether in electric use habits, consumption of fossil fuels, or reduction of Green House Gas (GHG) emissions;  Energy – jobs that support production and distribution of alternative, clean forms of energy;  Environment – jobs that prevent pollution, minimize waste, and clean up the environment;  Economy – jobs that contribute to improved equipment efficiencies, streamlined manufacturing processes, clean technology improvements and sustainable business practices; and lastly,  Equity – jobs that provide a pathway to prosperity for individuals frequently not engaged in skilled trades or the construction industry. We care because green jobs make good sense and because we understand that green jobs invest in our communities. By supporting the emergence of green jobs, we can concretely and collectively loosen the grip of our dependence on fossil fuels and rectify the security imbalance caused by expensive acquisition of these depleted resources owned and controlled by countries hostile to the U.S. Closer to home, green jobs help people take responsibility for their role in the present situation facing the community and participate in co-creating a new future. We need green jobs because they represent a new and powerful force for economic growth and long- term environmental sustainability. Here in Pennsylvania, since the start of the current Great Recession in December 2007, we have lost 192,300 jobs, and witnessed a steep increase in our unemployment and, critically, underemployment rates (14.1%). Earlier this month unemployment reached 8.5% statewide, the highest rate in over 25 years! At the same time, wages have declined for most Pennsylvania workers regardless of earning percentile (i.e., 40th percentile 1% drop, 50th percentile = 2% and 80th = 4%). Likewise, the nation has witnessed 6.6 million jobs lost, a 4.8% dip. More importantly, looking to the future, businesses large and small are setting rigorous goals and metrics for sustainable improvements in process, detailed energy audits (known as “treasure hunts”), supplier networks, and carbon output. Several encouraging examples point the way to successful outcomes. GE with its ecoimagination initiative has lowered costs over $100M by improving energy efficiency and reducing environmental impact. At the launch of the program in 2005, GE committed to a GHG reduction of 30% by 2008 and met its goal! In the 2008 year-end report, GE detailed the following successful outcomes:  ecoimagination’s portfolio of products expanded by one-third (e.g., combustion systems, ENERGY STAR rated appliances, uninterruptible power supply & power grid improvements);  Revenues rose by 21%; and  R&D investment in clean technology solutions climbed 25%. 2
  • 3. On a similar path of commitment to sustainability and reduced carbon emissions, Walmart has announced a Green Supplier Chain Initiative which will track the carbon footprint of its supplier network in order to identify best practices, measure sustainability and stimulate process improvements that deliver increased value and minimize impacts on energy and the environment. These private sector investments in sustainable business practices rely on green jobs. Likewise, states and the federal government have targeted major investments in the green sector to encourage the expansion of social capital that builds communities and can lead to “game-changing” transformation of local and regional economies. Green Jobs Examples In an important research effort on the make-up of green jobs, a team from North Carolina State University and the National Center for O*Net Development published in February 2009 "Greening of the World of Work: Implications for O*NET®-SOC and New and Emerging Occupations Definitions: Greening of existing occupations (O*NET study).” The O*Net study analyzed the green economy and its impact on existing and emerging green jobs and occupations. To concentrate its focus on the most relevant occupation sectors impacted by the green economy, the study selected 12 green sectors:  Renewable Energy Generation  Transportation  Energy Efficiency  Green Construction  Energy Trading  Energy and Carbon Capture  Research, Design, and Consulting  Environment Protection  Agriculture and Forestry  Manufacturing  Recycling and Waste Reduction  Governmental and Regulatory After evaluation of a range of green job definitions and occupations, the study selected three (3) occupational categories to measure the impact of the green economy on occupational performance. Within each category a number of specific Standard Occupational Classification (SOC) occupations were identified and are shown here (in parenthesis):  Green Increased Demand Occupations (64)  Green Enhanced Skills Occupations (60)  Green New and Emerging Occupations (91) (45 SOC occupations qualified as previously identified “in demand” industries; 46 separate candidate occupations qualified as green new & emerging) A brief sampling by category is detailed below to illustrate the green job classification process. Green Increased Demand Occupations Reported Occupation O*NET – SOC Code O*NET – SOC Occupation Bus Drivers 53-3021.00 Bus Drivers, Transit and Intercity CNC Operators 51-4011.00 Computer-Controlled Machine Tool Operators, Metal and Plastic Insulation Installers 47-2131.00 Insulation Workers, Floor, Ceiling, & Wall 3
  • 4. Green Enhanced Skills Occupations Reported Occupation O*NET – SOC Code O*NET – SOC Occupation Fuel Storage Technicians 11-3071.02 Storage and Distribution Managers Ground Water/Heat Pump 49-9021.01 Heating and Air Conditioning Mechanics Contractors or Installers and Installers Energy Crop Farmers 11-9012.00 Farmers and Ranchers New and Emerging Green Occupations (from previous classified occupations) New & Emerging Occupation Description Energy Auditors Conduct energy audits of buildings, building systems and process systems. May also conduct investment grade audits of building or systems. Brownfield Redevelopment Specialists and Site Participate in planning and directing cleanup and Managers redevelopment of contaminated properties for reuse. Does not include properties sufficiently contaminated to qualify as Superfund sites. Recycling Coordinators Supervise curbside and drop-off recycling programs for municipal government or private firms. New and Emerging Occupations (from new green sectors) New & Emerging Occupation Description Biomass Plant Technicians Control and monitor biomass plant activities and perform maintenance as needed. Climate Change Analysts Research and analyze policy developments related to climate change. Make climate-related recommendations for actions such as legislation, awareness campaigns, or fundraising approaches. Sustainability Design Specialists Address organizational sustainability issues, such as waste stream management, green building practices, and green procurement plans. The O*Net study and complete listing of the 215 identified green sector occupations can be found at: http://www.onetcenter.org/research.html?d=1 Cautions It is important to note that one must use caution when evaluating green job forecasts. As we observe, jobs are created in the economy due to growth, change and a host of market forces. Jobs routinely identified, defined, tracked and forecasted are generally based on the economy as it is not as it could be with substantial public (e.g., ARRA) or private investment. In the case of green jobs, it is especially important to exercise caution because both proponents and critics of green jobs and presence or emergence of a green sector in the economy are frequently tempted to overstate or obfuscate. The 4
  • 5. O*Net study is highly recommended here for its detailed technical analysis and fair handling of the green jobs subject. Current Status of Green Jobs in Pennsylvania Wind Energy Wind energy in Pennsylvania has had a large impact in the creation and retention of green jobs in Pennsylvania. Numerous studies have pointed to the positive direct and indirect impacts wind energy projects can have on the local/regional job market. For example, the Wisconson Energy Bureau has estimated that wind energy development creates 3-times as many jobs per dollar invested as have fossil fuel power projects traditionally. In reinforcement of this workforce assessment, the American Wind Energy Association (AWEA) estimates that for every 100 megawatts of wind energy designed and installed – 75 short-term and 45 long-term jobs are created or retained. In Pennsylvania, the Department of Environmental Protection (PA-DEP) echoes AWEA resource reporting of 463 existing megawatts of wind power generation (13 sites) and 356 MW under construction at 5 additional project sites. Pennsylvania ranks 16th in existing capacity and 22nd in potential capacity (www. awea.org). Wind energy jobs have been created in Pennsylvania through implementation of large and small wind farms as well as in the manufacturing of wind turbines and related turbine equipment and technology. Jobs include site assessors, construction jobs, operation and maintenance jobs, etc. The manufacturing process has created manufacturing, technician and engineering jobs as well as sales and project development jobs. Gamesa Corporation, a worldwide leader in the manufacturing of wind turbines and in the design and development of wind energy technologies, has opened production facilities in Fairless Hills (2006 - SE PA) and Ebensburg (2006 - Central PA). A related business development unit, Gamesa Energy USA, located in Philadelphia, PA, has the goal, along with its sister offices in Minneapolis, Minnesota and Austin, Texas, of developing and constructing wind farms in Pennsylvania and throughout the country. Other wind turbine manufacturers in Pennsylvania include ITW WindGroup in Montgomeryville, PA, GE Transportation Systems in Erie, PA, and Siemens Power Generation, Environmental Systems & Services in Pittsburgh, PA. In addition to large commercial scale wind developments, many Pennsylvania schools are implementing small wind projects for both educational purposes and as an alternative energy supply. One school wind project – Shade-Central City School District in Somerset, PA – has been implemented while 7 additional school wind projects are proposed or in the pipeline. 5
  • 6. Biomass Energy Biomass energy is defined as a sustainable, renewable form of energy because the resource (i.e., organic materials such as agricultural crops, crop residues and forest products) which generates the energy can be “renewed” frequently enough to not compromise the continued use of the bioenergy resource by future generations. The four (4) methods which generate biomass energy are: direct combustion, production of liquid fuels from crop seeds, cellulosic conversion of crop residues to liquid fuel, and methane production from animal manures. According to the Biomass Energy Center at Penn State University, the value chain in the biomass industry can be classified into four (4) categories:  Improved production of biomass feedstocks;  Integration of biomass production into sustainable agrosystems;  Conversion of biomass into energy; and  Technology transfer to companies, state agencies, NGOs, and citizens throughout Pennsylvania and beyond. Because the reductions in Green House Gas (GHG) emissions are so dramatic – biodiesel combustion is 78% less than petroleum diesel – we can anticipate continued and aggressive research in more feasible biomass products as the search for energy alternatives continues. An associated growth in green jobs from the growing biomass industry can be expected well into the future. Solar Energy According to the Pennsylvania Department of Labor & Industry in its preliminary review of green jobs creation, the solar market in the state is approaching $1 billion per year. As we evaluate the opportunities and incentives present in Pennsylvania, solar power – whether closed-loop thermal or photovoltaic installations – will be a major driver in expanding the energy marketplace to meet increasing demand for more affordable, more sustainable energy alternatives. A sample of some of the new and emerging green jobs, as defined by the O*Net study, is included on the next page. 6
  • 7. Sampling of Biomass, Geothermal, Solar “New and Emerging” Green jobs New & Emerging Occupation Description Design plants that generate electricity from the Biomass Plant Engineers combustion of biomass. Manage operations at biomass power generation facilities. Direct work activities at plant, including Biomass Production Managers supervision of operations and maintenance staff. Control and monitor biomass plant activities and Biomass Plant Technicians perform maintenance as needed. Manage operations at geothermal power generation facilities. Maintain and monitor geothermal plant equipment for Geothermal Production Managers efficient and safe plant operations. Perform technical activities at power plants or individual installations necessary for the generation of power from geothermal energy sources. Monitor and control operating activities at geothermal power generation facilities and perform maintenance and repairs as necessary. Install, test, and maintain residential and commercial Geothermal Technicians geothermal heat pumps. Direct work crews installing residential or Solar Energy Installation Managers commercial solar photovoltaic or thermal systems. Assemble, install, or maintain solar photovoltaic (PV) systems on roofs or other structures in compliance with site assessment and schematics. May include measuring, cutting, assembling, and bolting structural framing and solar modules. May perform minor electrical work such as current Solar Photovoltaic Installers checks. Monitor and repair the instrumentation, controls, and electrical systems in a utility-scale solar power Solar Power Plant Technicians generating facility. Contact new or existing customers to determine their solar equipment needs, suggest systems or Solar Sales Representatives and Assessors equipment, or estimate costs. Perform site-specific engineering analysis or evaluation of energy efficiency and solar projects involving residential, commercial, or industrial customers. Design solar domestic hot water and space heating systems for new and existing structures, applying knowledge of structural energy requirements, local climates, solar technology, and Solar Energy Systems Engineers thermodynamics. Install or repair solar energy systems designed to collect, store, and circulate solar-heated water for Solar Thermal Installers and Technicians residential, commercial or industrial use. 7
  • 8. Opportunities & Incentives in Pennsylvania The factors driving green jobs and development of the green sector economy in Pennsylvania are many and quite diverse:  Alternative Energy Portfolio Standards;  State and federal government funding programs that provide incentives for energy efficiency, conservation and renewable energy development;  Utility-based energy conservation programs;  Electric de-regulation that occurred in 1996;  Fluctuating energy prices in the global marketplace; and  Pending carbon regulations and federal energy legislation. Federal Summary Pennsylvania is anticipated to receive nearly $10B in recovery funding over the next 3 years based on formula-driven calculations for the Keystone State. Without consideration for possible competitive grant awards available, the energy funding share of the state’s ARRA total is $455M. When combined this amount with the $2.5B annual identified under the State Summary section earlier in this report, it is not at all surprising that the PEW Charitable Trust ranked Pennsylvania 3rd in the nation in the number of clean energy jobs. Likewise, Pennsylvania compares favorably in a June 2008 study conducted by the Political Economy Research Institute at the University of Massachusetts that reviewed “Job Opportunities for the Green Economy” in 12 comparable states (Florida, Indiana, Minnesota, Missouri, Nebraska, New York, Ohio, Oregon, Tennessee, Virginia, Wisconsin). Pennsylvania has distinguished itself among other states in the financial commitments made available and legislative framework constructed to stimulate energy efficiency and renewable energy initiatives in all energy sectors (agriculture, commercial, industrial, institutional and residential). In this section of the report, a sampling of these opportunities and incentives is presented. 8
  • 9. Alternative Energy Portfolio Standards (Act 123 of 2004) In Pennsylvania – like 35 other states – Alternative Energy Portfolio Standards are a primary incentive for growth in the green economy. Signed into law on February 28, 2005, the AEPS requires all electric distribution companies and generation suppliers to meet an increasing minimum percentage of alternative energy sources over a 15-year schedule. Pennsylvania’s Alternative Energy Portfolio Standards Electricity sold to PA customers must meet 18% alternative energy standard by 2021. Other than solar PV carve-out, specific sources are not mandated, but suppliers must meet 2-tier minimum on increasing gradual compliance ramp-up schedule.  8% - Tier 1  10% - Tier 2 Solar Thermal Solar PV (0.5% requirement by 2020) Wind TIER 1 Low-Impact Hydro (run-of-the-river) 8% Geothermal (electric generation) Fuel Cells Biomass Coal Mine Methane Demand Side Management (energy conservation) Distributed Generation (personal power) TIER 2 Large Scale Hydro Waste Coal 10% Municipal Solid Waste Wood / Pulp Coal Gasification Pennsylvania’s Department of Labor & Industry reports that investment in solar energy being driven by AEPS is nearly $1B per year. Wind accounted for $400M worth of business activity in 2008 alone. Combined with private sector investment in other renewable energy clusters, the total annual of investment in renewable energy owing to the AEPS is approximately $1.570B or $4.7B over 3 years. 9
  • 10. Alternative Energy Investment Fund (Special Act 1 of 2008) Adopted as the first major statute in the Special Energy Session of the General Assembly in 2008, the Alternative Energy Fund committed $650 million to a 5-year, front-end loaded incentive for the development of alternative energy in the Commonwealth. The investment category breakdown is detailed below and then a few of the currently active programs are highlighted: Solar Energy $180M Alternative Energy $190M Energy Efficient Green Buildings $ 25M Early Stage Green Business Development $ 40M Pollution Control Technology Projects $ 40M Alternative Energy Production Tax Credits $ 50M Energy Conservation Improvements $100M (Homeowners, Small Business, Low Income) Pollution Prevention & Environmental Clean-up $ 25M Renewable Energy Program: Geothermal & Wind Projects (Commonwealth Financing Authority-CFA)  $25M competitive grants, loans, and guarantees for installation or manufacturing of wind or geothermal systems for business, local government, non-profits Pennsylvania Sunshine Solar Program (PA-DEP)  $100M in funding for small business and residential  Rebates for qualifying solar photovoltaic (PV) and solar thermal installations Solar Energy Program (CFA)  $80M in funding for business, local government, non-profits  Grants, loans, and guarantees for solar photovoltaic and solar thermal 10
  • 11. De-regulation of Electricity In 1996 the Pennsylvania General Assembly and then Governor Ridge re-organized the electric utility industry to stimulate more competition in the marketplace. As part of this effort, the generation portion of the industry was re-structured and “caps” were placed on the rate structure for electric consumers. Now, more than a dozen years later, Pennsylvanians face the expiration of the last set of rate caps placed on generation costs. In other states (and the extreme northeast corner of Pennsylvania) when such rate caps have expired, electricity costs have increased dramatically, some might say “skyrocketed” with consumers experiencing rate hikes from 20-70%. Early rate shock predictions have moderated in recent months, but, clearly, the expiration of rate caps has Pennsylvania consumers very worried and, therefore, much more interested in energy efficiency and conservation. Expiration of PA Electricity Rate Caps Utility Rate Cap Status Transmission Distribution Generation Citizens Expired Expired Expired Duquesne Expired Expired Expired Met Ed Expired Expired 12/31/10 Penn Power Expired Expired Expired Penn Elec Expired Expired 12/31/10 Peco Expired Expired 12/31/10 Pike County Expired Expired Expired PPL Expired Expired 12/31/09 Wellsboro Expired Expired Expired West Penn/Allegheny Expired Expired 12/31/10 UGI Expired Expired Expired Act 129 of 2008 – Energy Efficiency and Conservation for Public Utilities Many industry observers believe that Act 129 will have the greatest long-term effect on the “greening” of Pennsylvania’s marketplace. The law mandates specific energy consumption reductions in all customer classes and can impose stiff penalties for failure to achieve required targets. A brief look at its key provisions will provide a familiarity with the breadth and depth of this game- changing legislation: 11
  • 12. Act 129 of 2008 Public Utilities: Energy Efficiency and Conservation  Bill signed into law October 15,2008  Conservation Plan due July 15, 2009  Electricity Reduction Targets  1% by 2001 3% by 2013  100 Hr Peak Demand Reduction  4.5% by 2013  Reductions Monitored & Verified  Reductions in all customer classes  Conservation Plan Budget Limit  2% of all 2006 total annual revenues ($245M estimate statewide)  Penalty: failure to meet targets  $1M minimum - $20M maximum  PUC may set increased reduction  PUC to employ Independent Auditor targets after 2013 if cost effective State Summary The 2% of 2006 total annual revenues for all utilities, which can be recovered by utilities through automatic billing adjustments to cover plan costs, is estimated at $245M. Based on the draft utility plans submitted to the PUC and currently under review, several analysts have projected – using common multipliers for incentive programs included in Act 129 plans – that an emerging statewide energy efficiency and conservation industry will be created by Act 129 with an annual value of $650-750M. From a public utility standpoint, compliance with Pennsylvania law for energy efficiency/conservation and renewable energy – in the short term with Act 129 and, increasingly, over the next decade with the Portfolio Standards – will require a steadfast commitment to the development and implementation of new energy thinking and new markets. The combined green sector investment of AEPS, Act 129 and AEIF represents $2.5B a year. A transformative opportunity for green jobs. Federal Incentives American Recovery and Reinvestment Act of 2009 (ARRA) First and foremost in the federal arena for green jobs development is the American Recovery and Reinvestment Act of 2009 (ARRA) known most commonly as the “Economic Stimulus.” $61.3 Billion of the total ARRA package of $787 Billion is earmarked for energy investments. Virtually all of the workforce development and employment activities to be stimulated by ARRA fall into our working definition of green jobs. Additionally, the Green Jobs Act, while authorized in 2007, did not have funding appropriated until the enactment of ARRA. Some of the most notable programs are summarized in this section. 12
  • 13.  Energy Efficiency and Conservation Block Grant Originally signed into law in 2007, the EECBG received $2.7B in appropriation via ARRA. This formula grant program is available to U.S. states, territories, local cities (35,000 population or one of the 10 highest populated in the state), counties (200,000 population or one of the 10 highest populated in the state), and Indian tribes to develop and implement projects that improve energy efficiency and reduce energy use and GHG in local communities. To date, Pennsylvania has been allocated a total of $51.15M via formula grants to 20 municipalities ($27.6M) and the Commonwealth’s state share of $23.5M. More awards are anticipated as additional cities/counties complete required documentation. Pennsylvania’s total EECBG allocation = $102.5M. The $23.5M received by PA-DEP can be used for smaller cities, counties, non-profits at the state’s option. Recently, DEP created the PA CONSERVATION WORKS! Program with its EECBG monies to fund projects up to $250,000 that harvest at least 25% savings in energy consumption and reduced energy costs through efficiency improvements.  Weatherization Established 33 years ago in response to high heating oil prices and the Arab oil embargo of the mid-1970s, Weatherization provides assistance to low- and moderate-level income homeowners to reduce the cost of home heating and conserve energy. Under ARRA, the Weatherization program was appropriated $5B, a 20-fold increase over its FY2008 funding. It is projected that the ARRA funding will cover 30,000 homes and being fully expended by March 31, 2012. Pennsylvania’s share of the FY 2009 appropriation = $253 M – up from $14.6M last year – to be distributed via its Weatherization Assistance Program (WAP) and the 47 certified provider agencies. The first major impact of the increased funding will be a doubling of the maximum installation allowance per home – from a $2500 average limit in 2008 to $5000 this year. Weatherization monies were the first ARRA funds received in Pennsylvania earlier this year and the impact of the dramatic hike in funds will have a major effect on the initial wave of green job growth. Workers in the weatherization program, after an introductory training course, are to a large extent taught the requirements and skills/tasks of the job, on the job. The low-to-modest entry level skills required for entry level positions on weatherization crews mean that many of the new green jobs will first be realized on weatherization work crews across the state.  State Energy Program (SEP) $3.1B restricted to states, territories and the District of Columbia to carry-out the goals established for the SEP: Increase energy efficiency to reduce costs and lower consumption for consumers, businesses, and government; reduce reliance on imported energy; improve the reliability of electricity and fuel supply and the delivery of energy services; reduce the impacts of energy production and use on the environment. States must submit plans that show how they intend to maximize efforts toward achieving the specific goal of reducing per capita energy consumption by ≥25% of the state’s 1990 per capita usage rate by 2012. Higher and more stringent goals are encouraged. Pennsylvania’s SEP allocation under ARRA is $99M. 13
  • 14.  Water and Sewer Infrastructure Several new and existing programs have recently been announced via the PENNVEST (PA Infrastructure Investment Authority). Under ARRA, $220M in earmarked recovery funds was reported in August, 2009: $155M for wastewater projects; $65M for upgrades to existing drinking water systems. New state funding, derived from the Pennsylvania Gaming Economic Development and Tourism Fund, has been pledged via an $800M bond issue – known as H2O PA – to pay for municipal water and sewer projects. When coupled with annual state funding of $300M, PENNVEST expects to invest $1.52 B over the next three (3) years on critically need water and sewer infrastructure improvements.  Green Jobs Training ARRA included $500M for green jobs training competitive grants through the Department of Labor (DOL). This funding has been split into five (5) separate grant competitions with a strong emphasis on strategic partnerships to prepare a range of candidate worker groups for careers in energy efficiency and renewable energy industries. In selected grant solicitations a “set-aside” is included for project serving communities impacted by restructuring of the automotive industry. The five competitive opportunities:  State Energy Sector Partnership $190M Submission Deadline 10.20.09 Eligibility limited to State Workforce Investment Boards, in partnership with the state workforce system and One Stop Career Centers to provide training and various activities to be included in a comprehensive statewide strategy for the energy sector.  Energy Training Partnership Grants $100M Submission Deadline 9.05.09 Energy efficiency (EE) and renewable energy (RE) training partnerships with a priority focus on unemployed individuals, workers in need of updated training, veterans, and, if you structured at the local community, individuals with a criminal record and populations not traditionally employed in construction and skilled-trade occupations, such as women and minorities. Training must be targeted toward careers in the seven (7) EE and RE industries indentified the Green Jobs section (§171(e) of the Workforce Investment Act.  Pathways Out of Poverty $150M Submission Deadline 9.29.09 Both national and local competition categories for eligible local public or private nonprofit organizations that serve between 3-7 in at least 2 states or a single community, respectively. Special emphasis in this grant opportunity required for the unemployed, high school dropouts, individuals with a criminal record and disadvantaged applicants living in areas of high poverty.  State Labor Market Information Improvement Grants $50M Submission Deadline 8.14.09 Targeting state workforce agencies or consortium groups of such organizations, this grant funding pool looks to enhance the collection, analysis and dissemination of labor market information in the EE and RE industries. As referenced in the cautionary note above regarding current green job labor market information and projections, this grant program is looking to fortify the labor exchange data in these two emerging industries. 14
  • 15.  Green Capacity Building Grants $5M Submission Deadline 8.5.09 Limited to current DOL grantees, this funding opportunity can be used to support capacity building for existing organizations to provide entry level training positions leading to career pathways in the EE and RE industries. Other Federal Renewable Energy Tax Credits and IRS Incentives Business Energy Investment Tax Credit (IRS)  30% for solar, fuel cells, and small wind projects;  10% for geothermal, micro-turbines, and combined heat-power applications Renewable Energy Grants (U.S. Treasury)  30% of qualifying cost for solar, fuel cells, and small wind projects;  10% for others * Individuals must select either the Investment Tax Credit or the Treasury Grant but not both. Renewable Electricity Production Tax Credit/Incentive (IRS/Dept of Energy)  2.1¢ per kWh for wind, geothermal electric, closed-loop biomass  1.0¢ per kWh for other eligible technologies (low-impact hydro, municipal solid waste, landfill gas, etc.  Qualifying facilities can opt for tax credit (IRS) or annual payments (Dept of Energy) Modified Accelerated Cost Recovery (MACRS) & Bonus Depreciation (IRS)  50% bonus for renewable energy systems acquired and placed in service 2008-2009  5-year MACRS depreciation Barriers in the Creation, Deployment and Retention of Green Jobs In their ground-breaking report on the challenges and rewards of “Unlocking Energy Efficiency in the U.S. Economy,” McKinsey & Company identified several “significant and persistent” barriers that stand squarely in the way of our country realizing the compelling economic, environmental and security paybacks from our more efficient use of energy. On a scale that would likely render Robert Louis Stevenson envious, McKinsey & Company enlisted the aid and support of several government agencies, research foundations, public and private companies, academic institutions and independent experts to go treasure hunting in hopes of unlocking the mystery of energy efficiency. “How is it that so many energy-saving opportunities worth $130+ billion annually to the U.S. economy can go unrealized?...despite decades of public awareness campaigns, federal and state programs, and targeted action by individual companies, NGO, and private individuals?” The conclusions they reached are insightful:  By their nature, EE benefits are highly fragmented, spread across 100 million locations and billions of devices at work in the home, the factory, the shopping mall. This dispersion guarantees that efficiency is the highest priority for virtually no one.  EE measures typically require substantial upfront investment in exchange for savings that accrue over a lifetime.  Measuring and verifying energy not consumed…is, by its nature, vexing. 15
  • 16. The report identified three (3) opportunity-specific barriers:  Structural: where end-user is unable to capture attractive EE benefit (e.g., tenant in rental unit has little choice/control of HVAC system, even though tenant pays the electric bill).  Behavioral: lack of awareness blocks pursuit of EE opportunity (consumer replaces broken appliance with cheapest available replacement rather than EE model with lower total ownership cost).  Availability: when end-user is ready and willing to pursue EE but can’t access EE unit in acceptable form (e.g., insufficient cash flow to acquire EE or bundling of EE features in premium unit is a deal breaker). Given the close parallels between the challenges of green sector workforce development and the widespread acceptance of energy efficiency, a close reading of the McKinsey & Company report is instructive. Recommendations for Future Green Job Growth A review of the literature on the subject of green jobs reinforces life lessons learned about energy use and consumption habits. Any significant behavior modification or even modest change in thinking doesn’t come easy. As can be seen, significant financial resources, unprecedented incentive funding and awe-inspiring “potential” will not individually or collectively bring about the market transformation necessary to fully realize the benefits of a thriving green sector workforce. Not until the “un-subsidized consumer” opts for cleaner technology and favors the green choice in the marketplace will we have succeeded. Specific future recommendations should include: 1. The recognition that nothing truly significant in our lives or the economy can undergo fundamental re-structuring simply because the empirical evidence recommends a favored course of action. An integrated and over-arching strategy is required to achieve the full potential of green sector development. One that is holistic yet simple. A bright idea. Energy efficiency is the bridge that can carry us through this transitional phase as we adjust to a carbon constrained future and… as we develop , invent and grow the low- and no-carbon energy sources of next week, next month and next year. Energy Efficiency is job one. 2. Look to the evidence from our past to verify what has changed the world: our children, grandchildren and the kid next door waging and winning their war on smoking, seatbelts, and recycling. Take the joyful spirit of greening along with its infallible logic into the kitchens, the kindergartens, and the playgrounds every bit as much as the boardrooms and lecture halls. When your kids can give you the definition of a “green job” from memory, you better be listening. Energy is a resource. Let’s begin the conversation immediately about how to manage and conserve it. Start now to incorporate the basic value and simple wisdom of energy management and conservation into pre-school and elementary school routines and daily regimens. Let’s get scouts and youth groups involved because as we’ve seen before – these life lessons are too important to leave to grown-ups. 16
  • 17. 3. Build on the drive and hard work necessary to convene and organize the type and style of strategic partnerships envisioned by DOL’s green jobs worker training grants. Carry that energy forward. Like any truly successful team you’ve been proud to be a part of, commit yourself to something bigger than yourself for the betterment of your community. You’ll likely find willing collaborators where you least expected. The Strategic Energy Sector Partnership for the Commonwealth of Pennsylvania, currently under construction, should encourage and reward local energy partnerships, envisioned and organized at the community level. Local institutions, co-created by local people in local communities, can bring focus, accountability and organization to green sector workforce development. Once created, these local energy partnerships can network with Pennsylvania’s very effective Career Link system to identify green career opportunities, provide needed support systems and track job placement and retention. 4. Make the case—first to yourself—then later aloud to others – that energy truly matters. When the value of energy is understood and accepted – like clean air and clean water – then we will start to care. Once we have a context for caring, like we did when our forests were clear cut or when abandoned coal mines poisoned our trout streams, then we can develop the best practices and problem-solving tools necessary to reclaim and repair. Innovation and commitment follow closely on the heels of caring. This essential re-thinking about energy will help create the context where green job awareness, can link up with the huge investment being made in the energy efficiency and renewable energy industry and marketplace. That is a formula for success. 17
  • 18. References Pollin, R., & Wicks-Lim, J. (2008, June). Job Opportunities for the Green Economy: A State-by- State Picture of Occupations that Gain from Green Investments. Political Economy Research Institute, University of Massachusetts, Amherst http://www.bluegreenalliance.org/atf/cf/%7B3637E5F0-D0EA-46E7-BB32- 74D973EFF334%7D/NRDC_report_May28.pdf Bezdek, R. (2007, November). Renewable Energy and Energy Efficiency: Economic Drivers for the 21st Century. Management Information Services for the American Solar Energy Society. http://www.greenforall.org/resources/renewable-energy-and-energy-efficiency-economic Green Jobs Guidebook (2008, September). Environmental Defense Fund. http://www.edf.org/article.cfm?contentid=8466 Green Collar Jobs in America’s Cities: Building Pathways out of Poverty and Careers in the Clean Energy Economy (2008). Apollo Alliance and Green for All. Wood, E. (2005, February). Jobs in the Renewable Energy Economy. Renewable Energy World http://www.earthscan.co.uk/news/article.asp?sp=608233664725232775346&v=3&UAN=386 Clean, Secure Energy and Economic Growth: A Commitment to Renewable Energy and Enhanced Energy Independence. (2008, February). The First Report of the New York Renewable Energy Task Force to Lieutenant Governor David A. Patterson. Green Jobs List: U.S. Partnership for Education for Sustainable Development. Erich C. Dierdorff, Jennifer J. Norton, Donald W. Drewes, & Christina M. Kroustalis. (2009, February). North Carolina State University. David Rivkin & Phil Lewis. National Center for O*NET Development. Greening of the World of Work: Implications for O*NET®-SOC and New and Emerging Occupations. The Pennsylvania Green Jobs Report: Preview. Pennsylvania Workforce Development. 2009. Mark Price, Stephen Herzenberg. (2009, September). The Keystone Research Center. The State of Working Pennsylvania. Pollin, R, Garrett-Peltier, H., Heintz, J., & Scharber, H. (2008, September). Green Recovery: A Program to Create Good Jobs and Start Developing a Low-Carbon Economy. University of 18
  • 19. Massachusetts-Amherst. http://www.peri.umass.edu/fileadmin/pdf/other_publication_types/peri_report.pdf The Sustainable Business Network of Greater Philadelphia. (2008, March). Building a Green Economy: Green Collar Job Development Initiatives in the Delaware Valley http://www.sbnphiladelphia.org/events/Building%20a%20Green%20Economy%20- %20March%202008.pdf Michigan Green Jobs Report: Occupations and Employment in the New Green Economy, (2009, May). Michigan Department of Energy, Labor & Economic Growth, Bureau Of Labor Market Information & Strategic Initiatives. Unlocking Energy Efficiency in the U.S. Economy. (2009, July). McKinsey Global Energy and Materials. McKinsey & Company. http://www.mckinsey.com/clientservice/electricpowernaturalgas/US_energy_efficiency/ 19