By Carter Hanson
Carter Hanson is a first year MAIR candidate studying climate and U.S. foreign policy at Johns Hopkins SAIS in Bologna, Italy. He is passionate about environmental politics and the policy-making process at all levels of government from the global to the local. He received a BA in political science and philosophy from Gettysburg College and has worked for political campaigns, held research fellowships, and edited an undergraduate political journal.
Introduction
The green energy transition has two components, politics and policy, and climate change mitigation must engage both to be effective. The challenge is not a shortage of policy solutions, which are abundant, but the election of climate-conscious governments and, therefore, the expansion of local support for mitigation policy. Bottom-up activism and persuasion are essential to shifting public will, but these strategies must harmonize with top-down policy solutions [1]. For this reason, justice must be treated as the essential political imperative of the sustainable transition.
Global climate leaders identify reactionary populism as the “biggest obstacle to tackling climate change” [2]. Political headwinds are particularly strong in the U.S., as the Republican Party is loath to acknowledge the climate crisis, let alone contribute to meaningful solutions. Consequently, U.S. energy policy may be highly inconsistent in the long run; if Donald Trump wins the 2024 presidential election, he plans to eliminate the IRA [3] and take significant action to reverse decarbonization [4].
These threats are supported by an ethos prevalent among many Americans that, as one gas pipe installer said, “[the green transition is] gonna take a middle class and destroy it” [5]. Nevertheless, most fossil fuel workers understand the exigent need to address climate change [6] and would support green policy if it does not leave their communities behind [7]. Climate-conscious politicians and activists must acknowledge and address the legitimate concerns of such constituencies as a political necessity, with justice being essential to mobilizing support for mitigation policy in communities often overlooked and ignored.
The Green Transition in the U.S.
The sustainable transition is well underway in the U.S., with 83.8% of new power plant capacity in 2023 expected to be renewable or nuclear [8]. The passage of the Inflation Reduction Act (IRA) is largely responsible for this recent climate progress [9]. In its first year, the IRA fostered $278 billion of investments into new clean energy projects; in the next decade, it could create as much as $1.2 trillion in investments [10]. Despite its high price, the IRA is cost-effective and prudent given the long-term cost of inaction [11].
However, the U.S. is still not on track to meet its climate goals. Before the IRA, the Rhodium Group estimated that the U.S. would reduce its greenhouse gas emissions by 17–25% below 2005 levels by 2030 [12]. Post-IRA, their estimate increased to 29–42% [13], but this figure is far short of the 50–52% required to meet the U.S.’s Nationally Determined Contribution (NDC) under the Paris Climate Agreement [14].
To achieve the NDC goal established in the Paris Agreement, the U.S. would need to fully decarbonize its power grid, which would cost approximately $4-4.5 trillion [15]. An additional obstacle to the U.S. energy transition is the shortage of land that can cheaply host renewables. According to The Washington Post, solar and wind farms are at least 10 times more land-intense per unit compared to coal- and natural gas-fired power plants [16]. Even highly efficient development would require roughly 114,642 square miles of land if the US energy system would completely rely on wind and solar, an area larger than the state of Arizona [17].
Compounding the land-use issue in the U.S. is a further geographical dilemma: efficiently transporting solar energy—primarily from the Southwest and Great Plains [18]—and wind energy—from the Great Plains and Midwest [19]—to the consumer markets on the populous Pacific and Atlantic Coasts. The U.S. has so far neglected this transmission problem, and the spike in renewables investments since the passage of the IRA is quickly overwhelming the fragile transmission system [20]. Achieving a comprehensive solution will require a huge injection of capital.
NIMBYism
A $4-4.5 trillion investment and a landmass the size of Arizona is a big sell for the climate ambivalent, let alone the fossil fuel dependent. In this way, policy solutions determine political challenges, and the immense expenditure demanded to mitigate climate change incurs an equally immense obstacle: not-in-my-backyard-ism (NIMBYism) [21].
NIMBYism assumes various forms, with the language of conservation prevailing in liberal areas and economic objections and traditionalism predominating among conservatives. NIMBYism is even present in affluent and otherwise liberal cities and suburbs, manifested as opposition to densification and making communities less car-dependent [22]. Other liberals counterintuitively cite protecting the environment as justification for advocating against renewable development [23]. Often it is a combination of many concerns, as was the case in Marshall, Michigan, where local opposition forced an indefinite hold on the construction of a $3.5 billion Ford battery factory [24].
In 2022, “[n]early 80 rural governments either banned or restricted solar energy projects” and “55 communities” limited wind development, according to the Institute for Energy Research [25]. Furthermore, environmental groups like the Sierra Club and Greenpeace continue to oppose nuclear energy, and activists have successfully shut down nuclear plants like the Indian Point plant in New York [26], thereby increasing emissions [27]. The pervasiveness of NIMBYism seriously complicates mitigation efforts, eroding community support for the sustainable transition.
In general, proactive cooperation and fostering early and regular engagement in communities can somewhat ameliorate local concerns [28]. Additionally, communities can directly benefit from renewable development by establishing municipally-owned utilities, which are cheaper, cleaner, and more efficient than private energy monopolies [29]. Adjusting the renewable energy mix can also lessen NIMBYism— offshore wind development could reduce the land shortage problem [30] and new technologies like enhanced geothermal could become a popular renewable alternative to natural gas fracking [31].
Beyond NIMBYism: Fossil Fuel-Dependent Communities
The largest community-based challenge to mitigation, however, is the unavoidable reality that many regions of the U.S. are highly dependent on fossil fuel industries for employment and tax revenue. The energy transition will be most painful for fossil fuel-dependent communities, not liberal NIMBYs, and additional policy support is needed to bring them on board.
Beyond the exigent need for continued and expanded employment in fossil fuel-dependent communities, which are some of the poorest in the country [32], just transition policies are necessary to lessen the possibility of a populist backlash derailing mitigation [33]. Expanding the social safety net could alleviate these concerns; according to a forthcoming study in Energy Policy, “a majority of fossil fuel community residents would support climate policy if coupled with just transition assistance” [34]. This points to an opportunity to increase support for green policies by engaging with and providing for regions too long written off by environmentalists and the climate-conscious Democratic Party.
In 2022, fossil fuel industries directly employed about 900,000 Americans [35], a figure that rises to 1.7 million when including indirect employment [36]. Emissions-intensive jobs are disappearing as the U.S. gradually decarbonizes, yet less than 1% of Americans who leave fossil fuel industries are able to attain green jobs [37]. This “rate of successful transition” is slowly rising as the number of available clean energy jobs increases, but the transition is leaving many behind [38], especially older and less-educated workers [39]. Environmentalists and Democrats often gloss over this reality, but they must understand and address this issue to expand the climate-conscious coalition and advance mitigation.
The first challenge to providing continued employment to fossil fuel workers and integrating dependent communities into the emerging sustainable economy is inherent to the practical enterprise of green technology: renewables are more efficient than fossil fuels, requiring a smaller sustained labor force for their long-term operation. Green energy projects initially require a significant workforce during construction but subsequently employ fewer workers during production than fossil fuels [40]. In short, renewables can produce “more watts per worker” than fossil fuel alternatives [41]. Furthermore, renewable jobs pay less on average than fossil fuel jobs [42]. In California, for example, a 2021 study from the Political Economy Research Institute found that the average salary of a clean energy worker is $45,000 lower compared to that of a fossil fuel worker [43]. Beyond the increase in efficiency, lower unionization rates in the solar and wind industries (4% and 6%, respectively) than in the fossil fuel industry (17%) contribute to these pay and employment disparities [44].
The second challenge is location. A 2022 International Monetary Fund report concluded that areas with “green-intensive” and “pollution-intensive” employment generally cluster in different regions of the U.S [45]. Similarly, other research has identified “little co-location between [...] fossil fuel worker employment and projected green job growth” [46]. While some states have both robust fossil fuel sectors and high renewable development potential —such as Texas, Oklahoma, and Wyoming—other states have large numbers of fossil fuel workers but relatively little renewable potential, such as West Virginia, Pennsylvania, and Kentucky [47].
Exacerbating these challenges is a bevy of systemic obstacles. American workers are more vulnerable to job displacement and pay cuts than their counterparts in other developed nations, as they are less unionized and have a weaker social safety net [48]. While most developed democracies have robust unemployment benefits, employment is itself the social safety net for many American workers [49]. Similarly, the U.S. boasts one of the lowest unionization rates of any advanced economy at 10.3% [50]— a low figure compared to the population-adjusted averages for the European Union at 20.1% and the Organisation for Economic Co-operation and Development (OECD) countries average at 17.4% [51]. Workers in fossil fuel-dependent communities face further challenges, as 45% of energy communities are “disadvantaged” according to the U.S. government, meaning that they are characterized by high rates of poverty, health issues, and poor infrastructure [51].
To its credit, the IRA takes preliminary steps to advance the just transition. It conditions renewable subsidies on paying workers a livable wage and mandates the inclusion of clean energy training in apprenticeship programs [53]. Most importantly, it incentivizes developing renewables in “energy communities” (fossil fuel-dependent regions) by subsidizing up to 40% of project costs and $4 billion in tax credits [54].
These solutions, however, address only a small fraction of the problems inherent to advancing mitigation policy in the face of widespread local opposition. The IRA neglects the reality that renewables are more labor-efficient than fossil fuels, thereby decreasing the demand for and price of labor. The result is fewer employees who get paid less, exacerbating the systemic failures of the U.S. social safety net [55]. The IRA also fails to provide direct assistance to systematically disadvantaged communities dependent on fossil fuels and to create national institutions to address the concerns of these communities [56].
Solutions
Achieving a just transition requires directly assisting former fossil fuel workers, providing fresh revenue streams for local governments, and establishing federal institutions to coordinate just transition policy, in addition to continuing IRA reskilling programs and renewable development incentives. All Americans—not just energy developers—should benefit from renewable energy’s increased efficiency. To maintain and expand support for climate action, mitigation policy must ensure that the oil and coal barons of today are not replaced by wind and solar tsars tomorrow.
Direct assistance must be robust and packaged in a politically pragmatic manner. For instance, a federal program can be established in the mold of the Alaska Permanent Fund Dividend. Alaskans receive an annual dividend from the Fund, derived from taxes on “revenues from publicly owned oil production”; in 2023, this dividend was worth $1,312 [57]. A similar fund—derived from renewables instead of oil revenue—can be established nationwide, particularly as renewables become increasingly lucrative [58]. Unlike the Alaska fund, however, this can be distributed according to fossil fuel dependency and carbon-intensive job losses.
Using the Alaskan model would make implementing a basic income politically palatable; the dividend has been successful (and popular) because its design conforms to Alaska’s libertarian political identity. Regardless of ideological presentation, the dividend is ultimately a form of basic income, and such a policy for renewables could increase public support for mitigation [59]. To ameliorate concerns that this scheme could undermine renewable energy’s market competitiveness with fossil fuels, the fund could only draw from renewables to the extent that renewable development remains cheaper than that of fossil fuels. The material purpose of employing a dividend model, rather than directly funding these communities, is to facilitate political feasibility.
The concerns of fossil fuel-dependent communities rich in green energy resources can also be addressed by ensuring that renewable development improves local economies [60]. In Denmark, new wind farms must be “at least 20% community-owned”; implementing a similar policy in the U.S. would ensure that communities benefit from and are directly involved in planning and implementing renewable projects [61]. Similar legislation is already in effect on Native American reservations, which receive direct payment tax credits for renewable installations [62].
Additionally, the U.S. must help local governments, particularly in rural areas, achieve energy independence through renewable development. In the 1960s, Iceland established the Geothermal Exploration Fund, which refunds half the cost of geothermal projects that village governments propose [63]. By enacting a similar program to subsidize proposals based on “energy community” status, renewables can be developed where jobs are needed most. Empowering communities also provides tax revenue that improves schools, local businesses, and the long-term economic health of these marginalized regions.
Finally, as proposed in a Brookings Institute article, a “Just Transition Office” can be established to facilitate coordination between federal, state, and local governments and provide a nationwide vision for a just transition [64]. Some states, such as Colorado and New Mexico, already have robust just transition programs, with Colorado’s Just Transition Office working to attract investment, bring state government resources to communities transitioning from coal, and help fossil fuel workers gain stable employment in green energy and other industries [65].
Conclusion
Fossil fuel-dependent communities, both those that have and that lack renewable potential, must shift away from their economic dependency on fossil fuel production. Extensive federal investment and social safety net expansion is needed to fuel comprehensive economic development. To prevent dependence on extractive industries and help fossil fuel workers transition to green jobs or gain employment outside of the energy sector, the U.S. must heavily invest in some of its most impoverished regions. The climate-conscious must recognize that the politics of the energy transition require a holistic policy approach in which renewable development is inseparable from a new war on poverty. Political necessity and mitigation policy must cohere; the sustainable transition is impossible without justice.
References:
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