Monday, March 15, 2010

Green Technology Means Higher Unemployment

There is a sense of frustration in America today; our government is taking concrete steps to drive up unemployment while millions of Americans are looking for work. People are fed up with the status quo and they want to get this economy moving again. Unfortunately however, the federal government is using green technology as a means to drive up unemployment and to prolong the recession. This claim may seem strange as it stands in contrast to the often presented picture that green technology will help solve our current economic woes; but in reality green technology is making the situation worse.

To help sort fact from fiction CARE is pleased to present Dennis T. Avery, a regular contributor and Senior Fellow with the Hudson Institute. As an environmental economist he builds the case that government-mandated green technology such as the "smart grid" is driving up unemployment in America just as government-imposed renewable energy is driving up unemployment in Spain. He also points out that federal mandates are benefiting Chinese manufactures as America imports wind turbines from the far-east. All the while our federal government is failing to help advance proven energy sources such as fossil fuels and until this changes, more American workers will be left filing for unemployment benefits...

Losing Jobs With Green Technology
President Obama has allocated $4 billion in "stimulus funds" to help advance the "smart grid," which is intended to seamlessly integrate all our new solar and wind power into the national supply of electricity. Much of the $4 billion will be spent to install 20 million new digital "smart meters." These meters will instantly tell the power company how to deploy its varied generating sources most effectively.

The "stimulus fund" goal is to create new "green" jobs. The Washington Post estimates that deploying the 20 million smart meters will create jobs for about 1,600 installers, and keep them employed for about five years. The manufacturing process for the meters will be highly automated, so only a few hundred jobs would be involved there. Still, 2,000 green jobs for five years, paid for by stimulus funds, must be good. Or is it?

Let’s think this through. The smart meters report automatically to the power company. We’ll lose 28,000 existing, permanent jobs for meter-readers. The Washington Post says all our "green" energy efforts are likely to produce only tens of thousands of jobs, not the millions of jobs needed to keep America at full employment.

A good Spanish study, led by Dr. Gabriel Calzada of Juan Carlos University in Madrid, found that every renewable-energy job created by the Spanish government has destroyed 2.2 other energy-related jobs. Worse, every megawatt of expensive "green energy" has destroyed 5.39 jobs in non-energy sectors as products became too expensive for consumers to buy—or as manufacturing shifted to countries without energy taxes. President Obama has held Spain up as a country for us to emulate, which only emphasizes that Calzada’s study is likely an Obama-valid blueprint for our own energy future.

Note, by the way, that China has already become the world’s major source of wind turbines, cutting further into Obama’s "green job" expectations. The wind turbine manufacturing will shortly be joined by our steel and aluminum industries, fertilizer plants and many other production facilities when the U.S. energy penalty taxes mount up.

Unfortunately, the $4 billion doesn’t replace our massive existing investments in coal-fired and gas-fired power plants, in gasoline refineries and service stations, in natural gas pipelines and drilling rigs. In reality, the renewables will subtract from our standard of living.

In 2007, U.S. subsidies to coal-fired electricity were 44 cents per megawatt hour, compared with $23.37 in subsidies for wind turbine megawatts, and $24.34 in subsidies per solar megawatt. That’s a fair measure of the added cost for renewables, except that wind and solar megawatts must also be billed for the additional costs of the fossil fueled plants that must be built and kept in "spinning reserve" in case the wind drops or clouds cover the sun. Denmark, a world leader in wind, has not decommissioned any fossil-power generators because of its "spinning reserve" requirement.

As Obama’s energy taxes force reductions in coal and oil production, the price of U.S. energy will double and triple—and so will the costs of the things we buy. Clearly, if the President wasn’t afraid of man-made global warming, we would not have spent the $4 billion on the "smart grid" at this moment of recession. Nor would we be planning massive and ineffective wind farms.
We might, instead, be designing new coal-fired power plants with the Department of Energy’s latest discoveries in clean-burn technology.

DENNIS T. AVERY is a senior fellow for the Hudson Institute in Washington, DC. He is an environmental economist and was formerly a senior analyst for the Department of State. He is co-author, with S. Fred Singer, of Unstoppable Global Warming Every 1500 Hundred Years, Readers may write him at PO Box 202, Churchville, VA 24421 or email to

Source: Gabriel Calzada; "Study of the Effects on Employment of Public Aid to Renewable Energy Sources," Juan Carlos University, Madrid; March, 2009.

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