Canada's embarassing green jobs record

Canada’s embarrassing green jobs record

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Canada's embarassing green jobs record
Unlike Canada, Germany is a world-leader in renewable energy development

The real-life global competition over clean energy is growing increasingly intense, as countries around the world sense a huge economic opportunity and the opportunity for cleaner air, water, and a healthier planet.

– Former US Energy Secretary Steven Chu, May, 2012

The current Conservative government wants Canadians to believe that economic development and sustainable development are opposing forces. Consequently, Conservatives see their Bills C-38 and C-45, with  draconian anti-environmental components, as justified. Nothing could be further from the truth.

First, the clean tech is among the globe’s fastest growing and highest job-creating sectors. In 2012, global investments in renewable energy amounted to $268.7B – down from $302.3B in 2011 due to decline in prices and costs, policy uncertainty in the US, and European economic woes.

China led the way with $67.7B in clean energy investments in 2012, an increase of 20% over the previous year, due to a surge in its solar tech sector. Investments in 2012 for the US, Japan and Germany were $42.2B, $16.3B and $22.8B respectively.

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On jobs, the employment to date in these sectors that only a few years ago were nascent sectors are extraordinary. The total global numbers of jobs in 2011 in clean energy sectors were 5M with China, once again leading the way with 1.6M, followed by Europe with 1.1M and Germany and India with 372,000 and 350,000 respectively.

Canada, as a result of the absence of adequate federal support for being a full participant in this growth misses out on job opportunities by the 1000’s every year and the gap between Canada and other developed nations grows yearly.

For a sense of lost employment opportunities for Canadians, the November 2012 report of BlueGreen Canada, an organization that represents unions and environmentalists, indicated that if the $1.3B in subsidies allocated to the oil and gas sector which currently supports 2,300 jobs were to be transferred to renewable energy, energy efficiency and public transit, this same amount of money would create 18,000-20,000 jobs in clean energy sectors – 6 to 8 times more jobs per investment unit.

Behind the aforementioned growth figures lies the fact that the point of departure for much of this leadership by other nations is government support for innovation. Specifically, innovation leads to product development and ultimately manufacturing jobs. However, the Conservative Budget 2013-2014, for the first time in over 40 years, did not assign any financing for clean tech innovation – zero!

To catch up, Canada’s requires a highly aggressive climate change action plan that includes substantive fiscal, legislative, program and research components for immediate implementation after the next federal election in 2015. Put another way, Canada’s catching up to the rest of the world should not focus principally a dependency on clean tech imports and the sacrificing of the potential for domestic clean tech innovation and manufacturing in Canada.

China

In 2009, China became the largest single energy consumer in the world, putting the US in second place. But, since then, China has also become the largest clean energy market in the world and a leader in the manufacturing of clean technologies for both domestic and international markets.

While thermal coal-fired generating plants continued to dominate new installations of electrical power generation, with 50.7 GW in 2012, wind energy came in second with a record 13.2 GW added. Total 2012 installed wind capacity was 67.7 GW and the installed projections are for 2020 are 200 GW. (Note, for comparative purposes, Quebec’s total electricity capacity is 37 GW, not including Churchill).

From the 150,000 jobs in the Chinese wind sector in 2009, the projections for 2020 in this sector are 500,000 jobs.

With respect to solar energy, there are 14 GW in the pipeline. China had 300,000 people who worked in the photovoltaic sector and  800,000 employed in solar heating/cooling in 2011. Projections for total installed solar capacity for 2020 are on the order of 50 GW.

The United States

The US is the second largest clean tech market and, consequently, its energy portrait is changing rapidly. Wind was the largest new source of electrical power generation in 2012 with 13.1 GW of new installations, bringing the total US installed capacity to 60 GW.

This US migration to a green economy was kick-started with the American Recovery and Reinvestment Act (ARRA), which pumped $70B into the green economy – including major investments in innovation – during the 2009 to 2011 period, the first half of the first Obama mandate. Grants, tax credits loans, loan guarantees and investments in research were among the principle mechanisms applied during the 2009-2011 period. Republicans have since put the brakes on this; nevertheless, a strong momentum has been established.

There are about 75,000 people working in the US wind sector and over 500 facilities manufacturing turbine components. There were about 119,000 jobs in the US solar in 2012, a 13% increase over 2011 and the biomass and geothermal sectors provided 152,000 and 10,000 jobs respectively in 2011. When one adds the sum of the various parts of the renewable energy sectors, renewable energy capacity in the US doubled in the 5 years from 2008 to 2012.

Meanwhile, in parallel, between 2007 and 2012, oil consumption as a percentage of total US energy consumption dropped from 39.3% to 36.7%. As well, the consumption of coal has dropped from 22.5% of total US energy consumption in 2007 to 18.1% in 2012.

The impacts of the above-mentioned factors combined with investments in energy efficiency by power utilities and improved average fuel consumption of US vehicles, have resulted in a 13% drop in US CO2 emissions from 2007 to 2012.

In his late June 2013 statement on new actions on climate Change, President Obama announced an objective of a reduction of 3B metric tons by 2030. Unfortunately, the new support proposed for clean energy in his pronouncements was very modest.

The good news is that President Obama announced that the process for approving clean energy production and distribution on federal lands would be accelerated. This is good because federal lands represent 20% of the US continental land mass. The bad news is the June 2013 proposals are in effect an accelerated version a Department of the Interior mandate assigned during the ARRA 2009-2011 period. No details have been provided as to the nature of initiatives to speed up DOI approvals.

Disappointing in the June 2013 action plan, is the lion’s share of new funding, $8B, is to be allocated to technologies to reduce fossil fuel emissions, in particular to support carbon capture and storage technologies (CCS).  CCS technologies are prohibitively expensive and consume enormous amounts of energy while only offering modest carbon reduction.

Short time line extensions from the ARRA days are 1) the Investment Tax Credit of 30% on investments, primarily applied for the construction of solar farms and 2) the Production Tax Credit of 2.2 cents/kWh used mainly by wind farm developers.

Europe

In Europe, renewable energy represented 69% of new electrical power capacity installed in 2012 while the oil, coal and nuclear sectors experienced negative growth.

There were 11.6 GW of wind power installed in 2012, bringing the total installed capacity in 2012 to 105.6 GW. Wind is expected to reach 136.5 GW by 2014 and 230 GW of installed capacity by 2020.

Solar installations surpassed wind in 2012 with 21 GW of installations, representing one quarter of 2012 global solar installations in that year.

This rapid growth of the European renewable sectors is generating equally rapid employment growth. From 192,000 jobs in Europe’s wind sector in 2009, the European Wind Energy Association (EWEA)  is predicting  280,000 jobs in 2015 and 450,000 by 2020. So quickly is the industry growing that despite the exceptionally high unemployment in many parts of Europe, the EWEA estimates that the industry will experience a skilled labour shortage of 5500 jobs/year.

Germany is a leader among European nations with about 372,000 jobs in its renewable energy sectors for the year 2011. That’s bigger than the German auto industry. By 2020, the projections are for 400,000 to 500,000 employed in the renewable sectors.

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In parallel, Germany’s nuclear sector is on the way out – a consequence of the Fukushima crisis. Germany has shut down 8 of its nuclear plants and intends to shut down the remaining 9 by 2022.

Germany’s installed wind capacity was 31.3 GW in 2012, representing 30% of the European Union total. Its installed capacity of solar energy in 2012 reached 32 GW, making it the second largest solar market in the world after China. With respect to its renewables targets for the percentage of total energy consumption by 2020 (including the transportation sector), Germany has a higher target than the 20% target of the European Union. Germany is going for 35% and offshore wind will play a major role in pursuing this target. To this end, the German development bank, kfw will be backing offshore wind development with $7.2B (€5B) in financing.

Conclusion

The US, Europe, China and other developed nations are well-engaged in the migration to a green economy – from supporting domestic innovation; to the construction of green technology manufacturing plants; to the development of clean energy production sites; and more generally, to the expansion of national and international markets.

These developments continue to give rise to the creation of jobs by the thousands in most regions of the developed world – with the exception of Canada. They also offer hope for developing countries, where more than 50% of the global potential for renewable energy power production exists.

Conversely, all the evidence indicates that the old model – the fossil fuel-based economy – no longer makes sense. The old model not only requires massive dependencies on importing energy and the resulting exportation and concentration of energy wealth, but it is also not good for the planet. Surely a healthy economy cannot exist in a planet that cannot sustain healthy life.

For at least the next 2 and a half years, until the federal election of 2015, Canada will largely miss out on the global green economy opportunities, both in terms of spreading the energy-related wealth across the country and in terms of green technology market possibilities, domestic and export markets alike.

Perhaps more importantly, under the present circumstances, Canadian innovation capabilities cannot be adequately supported to keep pace with the rest of the world and ultimately offer Canada high-job creating manufacturing and export opportunities.

In a recent special report on renewables to the United Nations, the International Panel on Climate Change concluded that public policies, rather than the availability of the resource, are the key determinants regarding expansion or constraints to renewable energy development/deployment. In its June 2013 report, the International Energy Agency came to similar conclusions and added that uncertainty about renewable policies may hamper investment and growth.

In other words, the extent to which nations benefit from the high job-creating clean tech sectors, while reducing emissions, is a matter of political will. There certainly are no lack of possibilities for those who choose to be a part of the solution, in light of the fact that less than 2.5% of the globally available technical potential for renewables is currently exploited – leaving over 97 % untapped.

Indeed, the technical potential of renewable energy technologies exceeds the current global energy demand by a considerable amount. Meanwhile, the prices of clean technologies have declined considerably.

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About Will Dubitsky

Will Dubitsky worked for the Government of Canada on sustainable development policies, legislation, programs and clean tech innovation projects/consortia. He lives in Quebec.

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