December 8, 2010
In all the jargon-laden field of sustainability and climate change, some of the most common but most unnecessarily obscure terms are “Renewable Energy Standards” (RES), also known as “Renewable Electricity Standards” (RES) and “Renewable Portfolio Standards (RPS).” All are essentially the same thing — requirements that electric companies get a certain proportion of their energy from renewable sources like wind, solar, and geothermal.
Currently 29 states have some form of binding RES policies. Once implemented their RES programs will cover approximately half of retail electricity. Yet under these programs less than 5% of total projected electricity generation will be renewable by 2025.
Some states have gone much farther. Maine law, for example, requires 40 percent of electricity come from renewables by 2017. But some politicians are trying to eliminate the RES policies that states have already implemented.
A national RES is under active debate in Congress.
RES policies address several goals:
- Diversifying energy sources to make prices more stable and supply more secure.
- Reducing the greenhouse gas emissions that cause global warming.
- Reducing pollution.
- Increasing energy independence.
- Creating new jobs.
A transition to renewable energy sources for electricity can play a major role in reducing greenhouse gasses and other pollution and health threats.
The public is often told that measures to prevent climate change by transitioning to “green energy” will threaten jobs and livelihoods. RES policies refute that belief. A recent study estimates that RES policies already established by states will create two million new jobs. California’s 33 percent RES standard alone is predicted to produce a quarter million to half a million jobs. It is estimated that a national RES will create between 300,000 and 850,000 new jobs.
Not everyone supports RES. For example, the Edison Electric Institute, the trade association for privately owned utilities, opposes a national RES. So does the National Association of Manufacturers, whose president says, “an RPS will lead to higher electricity prices for all types of consumers, undermining the ability of U.S. businesses to compete in a global economy and reducing the take-home pay of American workers.”
Why RES is an issue for labor
RES policies matter for workers and organized labor.
Organized labor has supported the transition to a green economy, recognizing that it is not only necessary for protecting the earth’s climate, but that it can also provide a massive expansion of “green jobs.” But clearly that transition – and the jobs it will create – is not happening on its own. It requires public policy commitment and a substantial public role in regulation and investment. RES policy is a crucial building block for that transition.
Appropriate public policy is also necessary to ensure that the green jobs are good jobs and that workers can choose to make them union jobs.
Renewable energy will provide a reliable source of safe, clean energy, which labor has long maintained is crucial for economic prosperity.
The individual and social costs of making the transition to green energy are small compared to the colossal but often disregarded costs of not doing so. However, public policy must ensure that there is a “just transition” in which the small proportion of workers and communities that might be adversely affected will be protected.
Making the green transition is essential to create the kind of sustainable world we want and need not only for ourselves but also for our children and their children.
What RES policies for labor?
RES policy is set at both national and state levels. At present, the US has no binding national RES policy, although Congress and the Obama administration are discussing establishing one. In the meantime, many states have gone ahead on their own. Their policies are still evolving on the basis of experience. Labor has a strong interest in affecting several dimensions of RES policy at the state level.
One key issue is the level of binding targets set in RES policies. State standards currently range from 4 percent by 2009 in Massachusetts to 40 percent by 2017 in Maine. A goal often stated by RES advocates is “20 by 20”: a requirement for 20 percent renewables by 2020. Labor has a strong interest in raising the level of RES standards to create green jobs and hasten the transition to a green economy.
RES policy can affect the number of “green jobs” created locally or statewide. In California, for example, the legislature has struggled over the percentage of jobs created by its RES that must be located in-state. Labor and environmentalists have promoted a high level of in-state jobs. Gov. Arnold Schwartznegger initially pushed for out-of-state jobs, but has then supported a provision that guarantees that no less than 50 percent of the renewable energy be generated in California.
RES policy can also affect job quality. For example, California defines state-funded renewable energy projects as “public works” projects; they thus must meet the standards of prevailing wage laws. The state of Washington’s RES policy provides incentives for approved apprenticeship programs.
RES can be closely connected with other energy policies. For example, New York State has supplemented its RES with an Energy Efficiency Portfolio Standard (EEPS). It requires that electricity usage be reduced by 15 percent by 2015 – “15 by 15.” Such programs have significant implications for labor. They promise to create substantial numbers of jobs. They also require extensive worker training to create the necessary workforce.
RES policies have so far relied primarily on the private energy industry. But it remains to be seen whether the industry will in fact be able and willing to make the necessary changes. Meeting the challenge of renewable energy may require an expanded public role. This may enlarge the part long played by municipal, regional, and other public power companies – an important objective for public utility workers and unions. And it may involve expanded public investment in renewable energy – perhaps through a Marshall Plan or TVA for renewable energy.
National RES standards are currently under debate in Congress. Currently about half of states and half of the electrical market are not covered by binding RES. Federal standards would promote the shift to renewable sources in these states and markets.
Most proposed Federal standards are far below those being pioneered by many states. For example, Sen. Jeff Bingaman recently submitted the “Renewable Electricity Promotion Act of 2010” requiring utilities producing four million megawatt hours or more annually to get fifteen percent of their energy from renewable sources or increased energy efficiency by 2021. While the bill as written does not prevent states from establishing higher standards, there is a danger that the electrical utilities will try to modify Federal legislation to preempt higher state standards. Labor has an interest not only in promoting Federal RES standards, but in making sure that they don’t prevent states from developing higher standards of their own.
Labor’s role in RES
Organized labor and worker concerns can play a significant role in RES policy at both state and national levels.
At a state level, labor support of RES is likely to take different forms depending on the current state of play for RES issues:
- In states without RES, support is needed to establish them.
- In some states, powerful politicians are demanding the repeal of RES policies; it is in labor’s interest to defend them.
- In states with relatively low standards, the standards need to be raised.
- In states where utilities are failing to meet interim standards or proceeding too slowly toward ultimate standards, public support is needed to insist on compliance and block weakening of standards and/or acquiescence in delay.
- In states where policy objectives are not being met by current policies, alternative approaches, such as New York State’s mandatory procurement by a state agency, need to be considered.
- State RES campaigns can also be an important vehicle for educating the public on the value of renewable energy for climate protection, energy security, and job creation.
Public understanding of and support for RES at the state level can help lay the groundwork for a strong national RES policy that goes beyond existing state policies without weakening them.
At a national level, labor can play an important role in supporting high RES standards that do not preempt states from requiring still higher standards.