July 23, 2015 Categories: Clean Energy Climate Change EPA Rule

The Clean Power Plan Will Create Jobs and Cut Electricity Bills

Despite the constant repetition of doom and gloom from the usual cast of characters seeking to protect polluter profits at the expense of our health, our kids, and our planet, cutting carbon pollution with the Clean Power Plan just makes plain economic sense. And study after study keeps on proving it.

It should not come as a surprise that helping people keep their showers hot and their beers cold while using less energy in the process saves families money on their utility bills. Similarly, we will see lower, more stable electricity prices by building a clean energy economy that takes advantage of the free energy provided by the sun and wind, especially given the continuing decline in renewable energy technology costs. In contrast, if we continue to dig up more and more rocks from far-flung corners of the country so that we can burn them in old, dirty power plants, we will see price volatility and a trend of cost increases over time.solar jobs

As coal continues its long march towards obsolescence, renewable energy and energy efficiency investments will provide critical job growth opportunities. Efficiency puts Americans to work upgrading our buildings with cost-effective energy saving measures. The wind and solar industries together employ three times as many people as coal mining does.

[EPA regulations] are going to grow jobs, they are going to allow us to grow the economy, but they are also going to be extremely beneficial to consumers. It’s talking about saving money. – Gina McCarthy

The Clean Power Plan will help to accelerate America’s clean energy transformation, and will bring big economic benefits to Americans, along with the health and climate benefits that are the central purpose behind the rule. Nevertheless, the old guard will not go softly into that good night, so fossil fuel interests and the politicians they sponsor continue to repeat unsupported and disproven claims that cutting carbon is expensive and that somehow spurring innovation in emerging industries kills jobs. These claims are false. Here are the facts.

Every Credible Study Has Found that the Clean Power Plan will Lower Electric Bills

When EPA drafted the Clean Power Plan proposed rule, it performed a comprehensive analysis of the likely effects the rule would have on electrical rates and customer bills. This analysis probably significantly over-estimates the cost of renewable energy and energy efficiency, but even so, it found that American families are likely to save about $100 a year on their electric bills.

sample bill

This study employed the same modeling software electric utilities rely on when making investment decisions and seeking approval for projects and cost recovery from state utility commissions. The same cannot be said for reports commissioned on behalf of fossil fuel interests that backed reports asserting that virtually any carbon pollution reductions will dramatically increase the cost of electricity pieces.  NERA (which earned four Pinocchios from the Washington Post’s fact checker), the Koch-funded groups like Beacon Hill Institute, and Peabody Coal’s mouthpiece in the U.S. Chamber of Commerce, have all issued reports along these lines, all of which continue to be cited by climate deniers in Congress, despite the reports’ having been thoroughly and completely debunked.

Studies that look at the overall effect on electrical bills have found more realistic results, and generally found that consumers will see modest, but real savings on their electric bills, provided that states take a smart approach to cutting carbon. As I described in a previous post, the two approaches that can most effectively reduce bills are for states to engage in cooperative regional approaches and to prioritize energy efficiency investment and renewable energy.

The consumer advocacy organization Public Citizen has recently released a series of reports describing these benefits in individual states. Ohioans, Mainers, New Hampshirites, Pennsylvanians, KentuckiansWest Virginians, and Virginians for example, will save about 10-12% on their electric bills. That translates to  $104-$147 in savings for each family as a result of the Clean Power Plan.

But even these estimates may overstate the costs to consumers, especially as wind and solar take flight and become available at low prices in every part of the country.

Synapse Energy released a new report today showing that, if states take advantage of these declining costs and the value of energy efficiency, they can go way beyond the levels of savings projected from merely hitting their minimum Clean Power Plan compliance targets. Based on Synapse’s analysis, states can cut carbon pollution by 58% compared to 2005 levels (almost twice the savings EPA projects), while saving customers $168 to $420 per year.

The Clean Power Plan Will Create Thousands of Jobs

Neutral analyses have been done by third parties employing standard econometric methodology have looked carefully at how jobs will be affected as dirty fuels give way to new investment in cleaner alternatives. These studies show that the Clean Power Plan will spur the net creation of anywhere from 74,000 to 273,000 new jobs in energy efficiency, renewable energy, and other industries that benefit from the investment the rule will drive.

But it remains a standard talking point for anyone opposing environmental regulations that any new regulation will “kill jobs.” The fact that these claims have proven to be pretty much universally false hasn’t stopped coal-funded groups and others dedicated to promoting dependence on fossil fuels from making hyperbolic claims, asserting impossible job loss numbers.

CPP jobs

To justify some of the more egregious (but still frequently repeated) claims the Clean Power Plan would have to somehow wipe out the entire supply chain covering coal mining, transportation, and combustion in coal power plants, plus find another 95,000 jobs to magically kill, all while doing literally nothing to spur any new jobs whatsoever. This is, of course, ridiculous. There is no he-said she-said here. These claims of catastrophic job losses from the Clean Power Plan are false and indefensible.  However what is true is that the Clean Power Plan will put us on a path to a clean energy future that will build a stronger economy with more good-paying jobs.

More realistic studies done by credible sources reached show that these jobs come from investing in American homes and connecting more families to the benefits of clean energy.

One study, done by the Economic Policy Institute, has found that the Clean Power Plan will indeed result in about 3% more coal mining job losses than would occur under business as usual. These job losses, and all other job losses from historic mining communities should not be dismissed. Coal mining communities with hardworking Americans often times are hurt the hardest at the hands of coal companies and their profit-only driven agenda. As a nation we have to stand up for these workers. As coal companies enter bankruptcy in the near term, these communities are at further risk that coal CEOs will take their golden parachutes and run, leaving pension and healthcare obligations unfulfilled. These workers deserve our respect and our help in transitioning to a clean energy economy, not half-baked propaganda from coal companies trying to squeeze a few extra years out of their declining market share.

One potential way to help these workers comes from the Clean Power Plan’s job creation benefits: the same study finds that the rule will create  a net 96,000 jobs in clean energy industries, and another net 260,000 jobs as a result of the increased economic activity that comes with these new clean energy investments by 2020.

Another study, performed by Economists at the University of Maryland found that the Clean Power Plan will create more than 74,000 jobs by 2020, and that this number rises to 273,000 by 2040. This study, like the Economic Policy Institute study, examines both job losses and job gains.

10 States Have Already Limited Carbon Pollution and Seen the Economic Benefits

While all of the studies cited here point to the potential benefits of the Clean Power Plan, those benefits are still only potential. Fortunately, 10 states (which are home to one in every four Americans) already know from experience that growing the economy and cutting carbon go hand in hand.

CA GHG GDPCalifornia has limited carbon pollution since the passage of the Global Warming Solutions Act (AB 32) in 2006, and the state is now on track to cut emissions by 80% below 1990 levels by 2050. As the state’s population and economy continue to grow, carbon pollution has dropped, and now the state is considering doubling down on renewable energy with a 50% renewable energy standard by 2030.  Thanks in part to California’s clean energy leadership, There are currently 430,000 Californians working in the advanced energy industries and that number is projected to grow.

In the Northeast, the nine member states in the Regional Greenhouse Gas Initiative (RGGI) have seen similar success. A new report by The Analysis Group has found that, since 2012, RGGI has created 14,000 jobs and $1.3 billion in purely economic benefits for its nine member states.

As these states show, the benefits of limiting carbon extend to economic opportunity, too.

So as states examine their options for implementing the Clean Power Plan, they should be heartened by the experiences of the states that have already limited harmful carbon pollution, to the benefits of their residents’ wallets.

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