A Labor Market Analysis of the Electricity Sector for 2030 using the National Energy with Weather System Simulator

Abstract:

We conducted an analysis that utilized the National Renewable Energy Laboratory's (NREL) Jobs and Economic Development Impact (JEDI) models to estimate the temporary and permanent jobs, earnings, and state sales tax revenues that would be created by various scenarios of the National Energy with Weather System (NEWS) simulator. This simulator was created by a collaboration between the Cooperative Institute for Research in Environmental Sciences (CIRES) at the University of Colorado and the Earth Systems Research Laboratory (ESRL NOAA). The NEWS simulator used three years of high-resolution (13-km, hourly) weather and power data to select the most cost-efficient, resource-maximizing, and complementary locations for wind, solar photovoltaic, and natural gas power plants along with high-voltage direct-current transmission, thereby providing the cheapest possible electricity grid that facilitates the incorporation of large amounts of wind and solar PV. We applied various assumptions to ensure that we produced conservative estimates, while keeping costs in line with those of the NEWS simulator.

Our analysis shows that under the lowest carbon-emitting scenario of the NEWS carried out (80% reduction in CO2 compared with 1990 levels), almost ten million new jobs could be created by 2030. Of those jobs, over 400,000 would be permanently supporting the operations of the power plants. That particular scenario would also add over $500 billion to the paychecks of American workers and $75 billion to state tax revenues by 2030. All of this is achieved with average electricity costs of 10.7¢/kWh, because the electric system relies less heavily on fuel and more on jobs constructing, operating, and maintaining infrastructure.

We use the current presentation to describe the methods used to reach these findings and examine some potential impacts of our estimates on public policy. Although we are able to identify some systematic problems with the JEDI model, we find that these problems are unavoidable due to the limited data available about the new renewable energy industry. Our discussion will include estimates for many of the twenty-seven NEWS-generated energy mix scenarios, comparisons of the jobs gained through a lower-carbon energy mix to those lost by the coal industry, and the directions for future study.