ARPA-E (the Energy Department research arm) and EERE (the Energy Efficiency and Renewable Energy office at DOE) are two signature scientific research programs that have been the tip of the spear for innovation in a brand new jobs sector. The reason why these two DOE offices are expected to be targets in the federal budget is they have been the primary scientific research arms at the federal level behind innovative renewable energy research. Senior aides have signaled for weeks that they intend to take broad aim at climate and clean energy programs in federal agencies that were prominent during the Obama administration, which these were.
Why should you care about a bunch of alphabet soup acronyms in D.C? Here’s why:
ARPA-E and EERE have been at the center of this race to revolutionize an industry sector that is creating millions of jobs in every state. Multiple sources at the trade associations and federal agencies that track economic statistics for this sector confirm this.
Jobs at wind farms, wind-manufacturing facilities or both are located in 70 percent of U.S. congressional districts. The 10 congressional districts in the U.S. that produce the most wind energy are in Texas, Oklahoma, Iowa, Colorado, Kansas, North Dakota, Oregon, and California — all represented by Republicans.
This new energy sector in America — including energy efficiency, natural gas, solar, wind, hydro, nuclear, energy storage, electric vehicles, bio-fuels and smart grid businesses — now collectively generates $200 billion in annual revenues (almost the same as consumer electronics) and employs 2.7 million Americans.
The U.S. wind and solar industries employ more than 300,000 people. The wind energy sector employs nearly 90,000 Americans, 20 percent more than in 2015. Jobs in the solar sector have increased 123 percent since 2010. One of every 83 new jobs in 2015 was in the solar sector. On the flip side, low oil prices resulted in the loss of nearly 100,000 jobs in the oil industry.
There are 75,000 megawatts of wind power installed in the U.S. today, contributing 5.4 percent of the capacity of the power grid. This is expected to double to 10 percent by 2020, and to 20 percent by 2030 — creating 300,000 additional jobs. In high-tech computing, this sort of exponential growth is what led to “Moore’s Law” – the notion that computing speed doubles at regular intervals.
Right now, America’s solar industry employs nearly 209,000 workers, compared to about 150,000 jobs remaining in the domestic coal industry. A study published in the journal Energy Economics found that the growth of solar-related employment could absorb coal-industry layoffs and provide full-time careers for coal workers during the next 15 years. After retraining, the study concluded, salaries for technical workers in the solar industry would surpass the money they made working in coal.
Slightly more than 14,000 megawatts of new solar, a record, were installed across the U.S. in 2016. Last year, new investment in U.S. wind farms was $14.7 billion. A total of $33 billion worth of U.S. wind farms are being developed. Added to this are regular capital investments at more than 500 wind supply chain factories, and in the maintenance of the 49,000 existing utility scale turbines in the U.S.
Clean energy is also spurring investment in other related new technologies and industries. For example, 2015 revenues for energy storage grew 12 times, from $58 million in 2014 to $734 million the following year.
This economic renaissance isn’t happening just in big cities. Many rural communities are surviving because of the growth of renewable income and jobs. Traditional sources of farm income are in decline – down 17 percent in 2015, the third consecutive year that farm income has fallen. This is a major reason for declining land values across the heartland.
The overwhelming majority of U.S. wind farms today operate in rural areas and they pay $222 million annually to rural landowners. By 2030, rural landowners expect to receive $900 million a year for land leases for turbines. Utility scale solar is starting to have a large rural benefit too. North Carolina, for example, is now third in the nation in installed solar capacity and most of these solar farms are on rural lands.
Renewable energy has also become a competitive advantage for U.S. businesses. Hundreds of companies (including more than 150 from the United States) have made significant commitments to purchase renewable energy, with dozens of them pledging to obtain 100 percent of their energy from renewables.
Here’s what these American companies know. Those making the most ambitious commitments to renewable energy have seen a 27 percent return on investment.
Even if it closes its borders, America still needs to remain competitive in the world economy. Clean energy does that. Globally, advanced energy is a $1.4 trillion industry, nearly as large as world military spending ($1.6 trillion) in 2015.
“Technology improvements, cost declines, and the catalytic influence of new financing structures, have turned the (renewable energy) sector into a driver of economic growth – both in the United States and around the world. The renewable energy industry remains one of the most vibrant, fast-changing, and transformative sectors of the global economy,” concludes a report from the U.S. International Trade Administration.
The renewable energy sector employed 8.1 million people worldwide in 2015, according to the International Renewable Energy Agency (IRENA). Collectively, 60 percent of those jobs are in Asia, including 3.5 million in China, while 9.5 percent of the world’s renewable energy jobs are in the United States. IRENA expects there will be 24 million jobs in the clean energy sector by 2030. Solar photovoltaics were invented in the United States and wind turbines were pioneered here as well – yet we have ceded much of the current leadership in those technologies to other nations, principally China.
Based on today’s sales, 5 of the top 10 current wind turbine manufacturers are Chinese companies; only one of the top 10, General Electric, is from the U.S. China supplies about 70 percent of global demand for solar cells and modules. It was the world leader in 2015 in renewable power, biodiesel production, hydropower capacity, solar PV capacity, wind power capacity and solar water heating capacity.
Global investment in renewable power was $266 billion in 2015, more than double the amount invested in new coal- and natural-gas-fired power generation. China led the world with 36 percent of that total investment.
Energy efficiency, meanwhile, is like handing a new, tax-free check to every American family month after month.
The United States has enormous untapped potential to improve its energy productivity in every sector. McKinsey & Co. estimates that a $520 billion national investment in energy efficiency would cut nontransportation energy consumption by 9.1 quadrillion BTUs by 2020 – about 23 percent of projected demand. The U.S. economy would save more than $1.2 trillion and avoid annual greenhouse gas emissions equal to replacing 1,000 conventional 500-megawatt coal-fired power plants with renewable energy.
Energy efficiency measures, the least expensive and most readily available form of “clean energy,” produce savings for all consumers – savings that can be more productively spent in local economies where they produce a multiplier effect that can serve as an economic stimulus.
The Department of Energy’s two research arms, EERE and ARPA-E, have been important to all of this. The renewable and advanced energy economy is where the jobs are now in America. It would be willfully irresponsible to block this innovation. Eliminating or severely curtailing both of these innovative research programs does just that. The only reason to get rid of both of them is politics. In this case, it’s myopic, short-sighted politics of the worst kind – the sort that sacrifices rapid movement toward an inevitable American economic opportunity to appease the anti-science wing of the Republican Party that has found its voice again.