Clean energy has the potential to be a leading driver of economic growth for Pennsylvania as it recovers from the pandemic, according to a new report from the national business group Advanced Energy Economy.
Under a scenario where Pennsylvania receives a $50 billion stimulus investment, the report says the state would achieve an economic return of $400 billion. This scenario would also yield $20 billion in annual consumer savings and more than $20 billion in additional tax revenue.
The report allocates the funding toward renewable resources, energy efficiency, electric vehicles, grid monetization, energy storage, high voltage transmission and building electrification.
The Keystone State is already a big player in the energy sector. The oil shale industry plays a critical role in Pennsylvania’s economy, with more than 32,000 people working in the sector as of June 2020.
Pennsylvania is also the only state that levies an impact fee on unconventional natural gas operators. According to the Marcellus Coalition, the impact fee has generated nearly $1.7 billion in new revenue since 2012, which has been distributed to every county in the state. Gov. Tom Wolf has been pressing for years to add a severance tax on top of the impact fee to fund statewide infrastructure improvements, but hasn’t managed to garner support from the idea from the Legislature’s Republican majority.
Daniel Bloom, principal at Advanced Energy Economy, said the analysis points to Pennsylvania as “one of the strongest returns on investment with an eight-fold economic impact.”
By comparison, the same analysis gave California a sevenfold impact and Florida a fourfold impact.
“Given its strong manufacturing legacy, plus a broad and diverse base of companies and supply-chain, Pennsylvania is well-positioned to expand advanced energy,” Bloom says.
The analysis also suggests that Pennsylvania is uniquely poised to leverage electric transportation growth. About 150 firms currently operate in the state’s electric transportation supply chain.
“Our recent report found that more than 350 Pennsylvania firms, many of them in industries and geographies that have seen significant declines in recent years, could easily transition to serving the supply chain for electric vehicles, which is expected to grow at a rapid rate in the coming years,” Bloom said.
More than 2.6 million jobs would be created from the hypothetical $50 billion stimulus listed in the report, including short-term construction and other ongoing positions. Energy efficiency investments would result in 1.6 million jobs, renewable energy generation such as solar and wind would result in 405,000 jobs, and investments in electric transportation would result in 259,00 jobs.
Pennsylvania ranked 11th in the country for advanced energy jobs in 2019. The sector already supports more than 104,000 jobs in the state, which is nearly four times as many workers in mining, oil, and gas extraction.
President Donald Trump has sought to make the future of Pennsylvania’s natural gas industry a centerpiece of his campaign in recent weeks, seizing on comments by his Democratic opponent, former Vice President Joe Biden, as a sign that he wants to ban “fracking,” the process by which natural gas is extracted.
“That means no fracking, no jobs, no energy for Pennsylvania families,” Trump said during a series of appearances in the state Monday, according to Politico.
Biden’s desire to eventually move away from energy sources like natural gas is tied to their environmental impacts, as some pipeline operators in Pennsylvania have been accused of allowing excessive leaks and studies have claimed that the state’s methane emissions are far greater than the industry admits to.
The Marcellus Shale Coalition rejects the idea that the industry is in any way irresponsible regarding the environment, insisting that its members are in full compliance with state and federal regulations.
“Environmental safety and public health is a priority for the industry,” the organization wrote in a news release in June. “The tens of thousands of Pennsylvanians who work across the sector – building and union trades, professional engineers, environmental professionals, health and safety experts, as well as exploration and production companies that contract with hydraulic fracturing service providers, midstream companies and countless other Pennsylvania-based small, family-owned businesses – have every reason to place the highest value on regulatory compliance and transparency.”
Reports like the one from Advanced Energy Economy make the case that Pennsylvania can transition to cleaner, safer energy production and create jobs in the process.
“It is a fact that advanced energy jobs have been growing – twice as fast as Pa. jobs overall last year – while we would expect to see some fossil fuel jobs, especially coal, to decline,” Bloom says.
Bloom adds that the current number of advanced energy workers in the state is already “more than those working in fabricated metals manufacturing and twice those working in hotels and motels.”
“When the state legislature and governor are considering pathways for putting those that find themselves unemployed because of COVID back to work, EV supply chain companies including manufacturing, operation and maintenance, and wholesale trade and distribution should be considered for key stimulus actions,” Bloom says.
