DEPARTMENT OFAGRICULTURAL, ENVIRONMENTAL,AND DEVELOPMENT ECONOMICS

aede.osu.edu

Making Green Jobs Work for OhioMarch 3, 2011

Ohio Farm Bureau Federation

Amanda WeinsteinSwank Program in Rural-Urban Policy

http://aede.osu.edu/programs/swank/

Introduction

• Motivation• Ohio Energy Profile• Green Energy and Employment• Agriculture and Alternative Energy• Green Energy Strategy• Conclusion

• Ohio’s Senate Bill 221 requires 25% of the state’s electricity to be generated from alternative energy and at least half of that from renewable sources such as solar or wind by 2025

• In his State of the Union address, President Obama stated a national goal of obtaining 80% of our electricity from clean energy sources by 2035

Motivation

85.93%

0.78%2.75%

9.91% 0.43% 0.19%

Ohio 2009 Electricity Generation by Source

Coal

Petroleum

Natural Gas

Nuclear

Hydro

Other Renewables

47.06%

0.79%

22.35%

19.69%

6.64% 3.48%

U.S. 2009 Electricty Generation by Source

• In the green energy race, Ohio is definitely starting off behind and other states won’t be waiting for Ohio to catch up

Renewable Energy Breakdown

Geotherm

al

Hyd

ro Conventional

So

lar

Wind

Wood/W

ood Waste

MSW

Biogenic/La

ndfill Gas

Other B

iomass0

1000

2000

3000

4000

2008 Ohio Renewable Energy Generation

Thou

sand

Meg

awatt

hour

s

• Ohio generates far less renewable energy as a percentage than the U.S. as a whole

• Additionally, Ohio’s distribution of the renewable energy generation looks very different from the U.S.

Replacing Coal with Wind

• Our previous paper showed that replacing 25% of Ohio’s electricity with electricity generated from wind would decrease carbon emissions by approximately 58 billion pounds

• It would also increase energy costs for consumers by about $1.4 billion

• Ohio would gain at most 6,000 net jobs, and at worst, lose 1,000 net jobs. – Energy generation is capital intensive not labor intensive– There are significant displacement effects– Although green energy jobs have been experiencing significant

growth, the energy sector isn’t that large to begin with

Employment by Energy Source

Coal Natural Gas Biomass Low

Biomass High

Wind Low Wind High Solar Low Solar High0.00E+00

2.00E-07

4.00E-07

6.00E-07

8.00E-07

1.00E-06

1.20E-06

1.40E-06

1.15E-07 1.08E-07 8.90E-08

3.24E-07

8.11E-08

3.18E-07

8.46E-07

1.21E-06

Average Facility Employment (Jobs/kWh)

Implications for efficiency and productivity

Cost by Energy Source

Coal Natural Gas Nuclear Hydroelectric Biomass Wind Solar Geothermal0.00

5.00

10.00

15.00

20.00

25.00

30.00

35.00

40.00

45.00

10.04 8.3111.90 11.99 11.10

14.93

39.61

11.57

2016 U.S. Average Levelized Cost (2008 cents/kWh)

•The average levelized cost is the present value of all costs including building and operating the plants. •Ohio’s lower energy costs are in part due to the significance of coal in energy generation (also implies that the demand for energy efficient products will be lower)

• In 2007, Ohio had approximately 35,257 clean jobs

• From 1998 to 2007 clean jobs experienced a growth rate of 7.7% (0.85% annualized) while Ohio’s total economy experienced a growth rate of -2.2% over this time frame

• Most green jobs are not in green energy

Green Jobs

63%10%

15%

8%

3%

Ohio Jobs in the Clean Energy Economy

Conservation and Pol-lution Mitigation

Clean Energy

Energy Efficiency

Environmentally Friendly Production

Training and Support

Ohio Green Jobs

• With a declining manufacturing industry, Ohio employment has been struggling.

• Unemployment is still approximately 9.3%• Total number of jobs in Ohio is 6,304,302. • Although growing at an annualized rate of

0.85%, only 0.56% of jobs are clean in Ohio 2000 2009-2000 Years to Make Up

State Clean Jobs Total Jobs Lost Current Job Loss

Ohio 33,413 551,000 331

Michigan 21,546 800,100 303

• Life cycle emissions rates include the total aggregated emissions over the life cycle of the fuel to include extraction, production, distribution, and use.

• Also implies that buying an electric car is less “green” in Ohio and demand will be lower

Carbon Emissions

Coal Natural Gas Nuclear Hydroelectric Biomass Wind Solar Photovoltaic Geothermal0

0.5

1

1.5

2

2.5

2.082

1.244

0.034 0.036 0.092 0.028 0.078 0.03

Life Cycle Emission Rates (lbs CO2/kWh)

Agriculture and Alternative Energy

• Although the employment effects may not be large, alternative energy has the potential to be very good for agriculture

• Wind energy- it may look different but something about it fits – lifestyle, continue farming, additional income, etc.

• Wind concerns–some consider it an eyesore, noise, bats, birds, and other wildlife effects to consider

Ohio’s Wind Potential

Agriculture and Biofuel

• Alternative energy from biomass can also be a natural fit for Ohio

• Ohio climate is clearly conducive to growing corn which can be used in corn-based ethanol, algae used to make algae oil, and producing other biofuels

• Some biofuel concerns - raises price of corn affecting other agriculture sectors and food prices

Ohio’s Biofuel Potential

• Ohio has some often overlooked advantages when it comes to alternative energy

• Established transmission lines – population and manufacturing centers, significance of coal

• A recent article calls transmission lines “the missing link in energy evolution.”

• Because wind and solar are more land intensive, renewable energy must be located away from population centers (even farther than coal power plants) requiring significant power lines for transmission.

• To keep this an advantage need to continue to maintain and upgrade transmission lines and establish smart grid

Advantages of Ohio Alternative Energy

U.S. Population Density• The Dayton/Columbus region is one of two “centroids” in the U.S. because of

its proximity to a large share of the U.S. population and manufacturing centers

U.S. Energy Grid

Ohio’s Disadvantages• It’s important to look at Ohio’s resources especially compared to other areas• Solar is just not one of Ohio’s resources especially compared to other areas

such as Arizona and California and the southwest region in general

• Just because lacking solar resources doesn’t mean there’s not a place for Ohio in the green economy

• We need to be economically strategic when considering our green jobs strategy

• It’s important that we don’t just play follow the leader, but consider Ohio’s unique resources and find where Ohio fits into the green economy

• Use Ohio’s strengths while considering the strengths of other states competing for green jobs and businesses

• We need to find out how our strengths can fill green energy gaps

Economically Strategic

• More manufacturing experience than the U.S. – Build energy efficient products for households, businesses, and the

alternative energy industry– First Solar in Perrysburg, OH largest producer of thin film solar panels

• Meters and advanced instrumentation– Help with intermittent nature of alternative energy– Update energy grid and invest in a smart grid– Columbus, Cincinnati, and Cleveland are all experimenting with new

smart meters• Innovation and R&D in alternative energy– Energy storage and transmission (battery patents)

Taking Strategic Action

Ohio’s Current Green Energy Strategy

$350,000

$81,640,558

$5,418,095$10,102,044

$101,026,479

Ohio Third Frontier Green Economy Spending

Conservation and Pol-lution Mitigation

Clean Energy

Energy Efficiency

Environmentally Friendly Production

Training and Support

• Continue to support:– Alternative energy research and development and

innovation– Renewable energy projects– Energy efficiency– Conservation and pollution mitigation

• Increase attention and support for:– Environmentally friendly production and

manufacturing– Transmission and storage of renewable energy

Conclusion

Questions