From coal to clean: The economic challenge of shifting energy paradigms

Oil Price has published an article saying there's a significant skill gap and labor shortage in the renewable sector, necessitating greater support for both renewables and fossil fuel workers to ensure a smooth transition. Caliber.Az reprints the article.

A total switch to renewable energy is going to wreak havoc on job markets in the United States. In some places, this will be a great thing – huge numbers of well paid, steady skilled and unskilled jobs will pop up in communities close to utility-scale solar and wind farms, for example. But in other areas, the loss of fossil fuel jobs could be catastrophic if it’s not properly addressed and planned for.

The United States is home to 1.7 million fossil fuel workers. But until recently there has been a problematic lack of data about exactly where these jobs are concentrated, where they represent the majority if not the entirety of available work, and which areas will be hit the hardest by the coming energy evolution.

To help get out in front of this problem, the Massachusetts Institute of Technology (MIT) recently conducted a county-by-county study across the United States that shows exactly which job markets are the most closely tied to fossil fuels, and therefore most vulnerable to the clean energy transition. This map, which the researchers are calling an “employment carbon footprint,” could then be used by policy-makers to properly support these counties which will bear the burden of this unprecedented economic shift to ensure a “just transition.”

The focus on a just transition is important, because the transition is already underway, and it’s already looking like the widespread loss of fossil fuel jobs is an inevitability. In the year after the Biden administration enacted the Inflation Reduction Act – the nation’s single biggest piece of climate legislation in history – companies announced over $110 billion in clean energy manufacturing investments. And it’s estimated that, as of July of last year, those investments had already created more than 170,000 clean energy jobs.

According to the US Department of Energy’s annual employment report, more than 40% of all domestic energy jobs added in 2022 were in clean energy, with an increase in green jobs recorded in each and every one of the 50 states. While it’s encouraging that these kinds of jobs are spread throughout the country, there are still significant pockets within each state that are at risk of being left behind by the transition.

So while the green jobs boom is great news for the climate and for the economy writ large, these figures are nothing short of terrifying for the counties that rely on fossil fuels for their livelihoods and for the wellbeing of entire cities and communities. “Efforts to target communities in the US Inflation Reduction Act leave a significant number of the most carbon-intensive regions of the country behind,” states the aforementioned MIT study, published earlier this month in the Proceedings of the National Academy of Sciences (PNAS), a peer reviewed journal of the National Academy of Sciences (NAS).

The study found that there are a concerning number of counties that are highly dependent on fossil fuels to keep their economies afloat, but which are not currently eligible for support from the Inflation Reduction Act. “It’s important that policymakers understand these economy-wide employment impacts. Our aim in providing these data is to help policymakers incorporate these considerations into future policies like the Inflation Reduction Act,” lead author Kailin Graham was recently quoted by MIT News.

What’s more, the rapid addition of clean energy jobs has resulted in a major skill gap for laborers. It won’t be as easy as taking all those unemployed fossil fuel workers and putting them into all those new green energy positions. “Beyond construction, wind and solar farms typically require few workers to operate, and new clean energy jobs might not necessarily offer comparable wages or align with the skills of laid-off workers,” the New York Times reported last year.

At present, there are simply more clean energy jobs available than there are trained workers to fill them. At present, there is such a high demand for renewable energy workers that a labor shortage threatens to derail the United States’ planned buildout of renewable energy production and manufacturing capacity. Clearly, greater support is needed on both sides of the energy industry, for renewables and fossil fuel workers alike, in order to facilitate a smooth and just transition.