Minister Chen speaks with Alexander Ochs, Haibing Ma, and Chris Flavin (from left to right).

“China is dedicated to low-carbon and sustainable growth,” said Chen Dawei, head of the visiting Chinese delegation to the Worldwatch Institute. “[The] Institute’s experience and current works on promoting green development are really impressive and I hope collaborative projects can be developed through this meeting,” said Mr. Chen. Back in China, Mr. Chen is the Vice-Minister of the Ministry of Housing and Urban-Rural Development (MOHURD). He is leading the Low-Carbon Economy and Sustainable Urban delegation, which consists of more than 25 high level officials from Chinese central, provincial, and municipal governments.

The visit was organized by the Global Educational Institute at Georgetown University. During the meeting, Christopher Flavin, Worldwatch’s president emeritus, delivered the opening remarks and briefly introduced to the Chinese delegation the institute’s history, program layout, and major works. Alexander Ochs, the Director of the Climate and Energy Program, detailed our work in the Caribbean region by highlighting the unique characteristics of our Low-Carbon Energy Roadmap approach. I then provided an overview of our previous and ongoing China-related research works. In addition, I used this opportunity to introduce various ideas of our future China work, including a sketch of our plan to work with different levels of Chinese government.

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China, Chinese delegation, effectiveness, efficiency, green development, green economy, green transition, Low-Carbon Energy Roadmap, MOHURD, renewable energy, sustainable development

While U.S. policymakers remain hesitant to contemplate the transition to a low-carbon economy, Germany’s energy transition is already under way. At two Washington, D.C. events on Monday, October 3 (Germany’s Unity Day holiday), Franz Untersteller, Environment Minister for the German State of Baden-Württemberg, discussed his country’s efforts to phase out nuclear power and heavily promote renewable energy in the coming decades. Germany’s decision this spring to phase out nuclear energy by 2020 has been regarded as a controversial path to reducing greenhouse gas emissions and tackling climate change. At a panel titled Leading the Way or Lights Out? Germany’s Nuclear Exit and U.S. Energy Perspectives held at the Johns Hopkins School of International Studies (SAIS), Minister Untersteller described how Germany plans to achieve both the nuclear phase-out and the reduction of carbon dioxide (CO2) emissions.

Minister Untersteller has been Environment Minister of the State of Baden-Württemberg in the Green-Social Democratic government since the March 2011 regional elections. Baden-Württemberg is a highly industrialized German state that is home to global industrial players such as Mercedes, Porsche, and Bosch. The region could serve as a model for other very industrialized areas in showing how high energy intensity can be combined with CO2 emissions reductions. Untersteller described the German government’s nuclear exit strategy as “irreversible,” not just because the amendments to the Nuclear Energy Act were supported by an agreement of all parties in the German Bundestag, but also because the strategy is based on broad popular consensus. The nuclear phase-out by 2020 is accompanied by several other elements:

  • A substantial rise in the share of renewable energy in the country’s energy mix, projected to reach 38 percent of the national electricity supply by 2020, compared to 20 percent today and 6 percent in 2000;
  • The construction and use of flexible natural gas power plants;
  • Infrastructure adaptation, especially high investment in the electric power grid; and
  • Increase in energy efficiency, including a further decoupling of energy use from economic growth.

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Baden-Württemberg, Climate Change, energy, energy policy, European Union, Franz Untersteller, Germany, greenhouse gases, nuclear, phase-out, Untersteller

Metros with clusters across the United States

There are 2.7 million clean economy jobs in the United States, according to a recently released report by the Brookings Institution entitled “Sizing the Clean Economy: A National and Regional Green Jobs Assessment.” Brookings hosted an event to announce the release, at which one panel explored the fascinating and increasingly important role that Regional Innovation Clusters (RICs) play in fostering the clean economy.

The report shows that the majority of green jobs (defined as jobs with a direct or indirect environmental benefit) are in conventional sectors like manufacturing, waste management, and mass transit. But the fastest growing sector is clean technology, which includes renewable energy, smart grid, and energy efficiency. While 64 percent of green jobs in the U.S. reside within the 100 largest metropolitan areas (which hold 66 percent of the U.S. population), the same metros hold an outsized 74 percent of the clean tech jobs created from 2003 to 2010. The Brookings report takes this as evidence that metros have strong industry clusters that boost clean economy growth.

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brookings, clean economy, cleantech, clusters, economic development, emissions reductions, energy, energy efficiency, finance, green economy, green jobs, Green Technology, Innovation, low-carbon, nortech, Obama, regional innovation clusters, renewable energy, renewable energy finance, sustainable, technology series, United States

The United Steelworkers Union (USW) has long recognized that environmental health and economic wellbeing are inseparable. As long ago as 1990, the USW declared “the real choice is not jobs or the environment. It’s both or neither.” (USW President Leo Gerard speaks about his union’s environmental history in this YouTube video.) The union is a major sponsor of the U.S. Good Jobs Green Jobs conferences that began in 2008 and that attract well over 1,000 participants annually: labor and environmental groups, business representatives, and public officials. The USW has 1.2 million active and retired members, representing workers in such energy-intensive industries as steel, aluminum, iron ore mining, cement, glass, metals, paper, and rubber, but also those in other sectors, including wind turbine manufacturing.

The USW leadership has placed strong bets that green job growth will be a healthy antidote to the blue-collar blues afflicting the U.S. economy. A recent report by the U.S. Census Bureau indicates that almost 44 million Americans are living in poverty. One of the report’s most shocking findings is that those falling below the poverty line are often full-time workers who simply do not earn enough. In 2009, the poverty rate for working-age people (18–64 years) grew to 12.9 percent, the highest rate in nearly 50 years.

It is against this backdrop that we must see the USW’s decision this month to file a 5,800-page petition with the Office of the U.S. Trade Representative, pressing the case that “a broad array of Chinese policies and practices threaten the future of America’s alternative and renewable energy sector.” The union is complaining about hundreds of billions of dollars in subsidies, performance requirements, preferential practices, and other activities that are illegal under World Trade Organization rules. The Obama Administration has 45 days from the date of filing to decide whether to act on the petition.

The petition represents another step in what shapes up to be a growing international battle over who dominates green industries like wind and solar energy. In a mere handful of years, China has transformed itself from marginal player to dominant force, to the point where this year it will likely produce more than half the world’s solar panels and close to half the world’s wind turbines.

This rapid development has been possible in part because China has used cheap labor, subsidized land, low-interest loans, as well as technology transfer requirements for foreign investors and domestic content rules to hatch and grow domestic companies. Its solar photovoltaics industry is almost entirely export-oriented: more than 95 percent of Chinese solar panels are exported to countries like the United States, Spain, and Germany. Former industry leaders in Japan and Germany are reeling.

As far as export subsidies are concerned, the USW is presenting a strong case. Eager to conquer global export markets, China has to date not taken any comparable steps to enlarge its domestic market for solar energy installations (though it has a much stronger record in the wind sector, accounting for one third of the world’s new installations in 2009). Given its sky-high coal use, expanding the use of solar power and other energy alternatives at home is a critical and urgent need.

USW President Leo Gerard (Flickr photo: aflcio Bernard Pollack)

Where I part ways with the USW is with regard to its critique of China’s domestic content rules and similar measures that stimulate the growth of the renewables sector, such as expedited approval of permits to build solar and wind factories. First, the United States itself is no stranger to domestic content requirements. In 1978, Congress imposed such rules with reference to government procurement of transportation equipment, in an attempt to revive the moribund U.S. rail manufacturing industry.

Second, it is high time to learn from China and to stop playing the blame game. China has made enormous strides in the renewables industry. In a climate-challenged world, we need more of these kinds of policies—in China, the United States, and elsewhere—not fewer. As Martin Khor, Executive Director of the Geneva-based South Centre, points out, China is being criticized in the West both for not doing enough to restrain its carbon emissions, and for providing overly generous support for its renewable energy industry.

Khor charges that Western countries have shaped and bent trade rules to their own benefit. Beyond an apparent double-standard in how such rules are applied lies an even larger question. Should we allow WTO rules, which elevate free trade priorities above all other considerations, to be the primary measuring stick of policies designed to avoid catastrophic climate change? Up to a point, domestic content requirements make enormous sense, since they create the space necessary for homegrown companies to compete and provide jobs, and they avoid domination of critical green industries by any single country—whether China, the United States, or any other nation.

Martin Khor

Martin Khor (Flickr photo: WTO Geneva Photos)

The United States needs less rhetoric, and more real action, in support of green industries—in the form of R&D programs, overall climate legislation, feed-in tariffs that set reliable prices for renewable energy, business incubators, preferential financing, worker training, and other measures. The experience of Massachusetts-based Evergreen Solar is a sad, but instructive case. Unable to raise funds in the United States, the company decided to move the final manufacturing phase for its solar panels to China, where state banks offered very attractive loan terms. Some 300 U.S. jobs will be lost.

This kind of development presents one kind of danger. Another lies in the rise of rivaling forms of green protectionism and green mercantilism that are oriented toward exclusively national goals. What the world needs instead is more cooperative efforts to develop and share sustainable technologies.

China, domestic content, economy, energy, export, green jobs, mercantilism, protectionism, renewables, Steelworkers, subsidies, trade, trade union, US, USW, workers, WTO

Harmonious Concept? (foto: Leon Rice Whetton)

This post was co-authored by Michael Renner and Gary Gardner

We continue to wrestle with the following question: is it possible to build economies that provide ample jobs, without stoking the fires of consumption? What will provide job creation if people are not spending as much on personal consumption? Below, we offer some basic principles and ideas to guide policymaking. Note that many green initiatives appear to require complementary policies to ensure that jobs are not lost as the environment is protected. We invite readers’ views.

1. Tax extractive activities like mining, logging, and oil drilling. This is a high-payoff option, because extractive industries tend to create few jobs but lots of pollution. For example, it takes only about 5 percent of the energy to create an aluminum can from recycled materials as it does to create the can from virgin ones. Taxing extractive activities could be a major stimulus for building a robust, job-creating recycling industry, and for generally boosting the durability of products.

2. Tax waste more and workers less. Taxes on air and water emissions, garbage collection, landfill use, and other forms of waste would stimulate the adoption of cleaner methods of production and consumption. Revenues could be used to reduce taxes on labor, stimulating employers across the economy to hire. Germany [large PowerPoint file] already has some experience with this kind of tax shifting.

3. Steer disposable income toward less materials-intensive uses. Fewer sales of cell phones, cars, and oversized houses, offset by greater purchases of music lessons, soccer tickets, and visits to national parks, would surely lower the environmental impact of consumption. The net effect on employment would depend on the labor intensity of the particular mix of changes adopted, but this arguably could be shaped by regulatory and fiscal incentives to favor outcomes that maximize employment and reduce materials consumption. Wages are another consideration, since manufacturing jobs typically pay far better than most service jobs.

4. Restructure manufacturing and retail to meet people’s needs in a green way. Instead of selling products with a the-more-the-better attitude, manufacturers would provide a desired service. Consumers lease or rent products rather than buy them outright. Manufacturers remain responsible for proper upkeep and repair, and ultimately recover components and materials for recycling or remanufacturing. This would create jobs in repairing and reconditioning goods, and these jobs are less likely to be automated or outsourced. In retail, proficient and well-paid sales personnel would advise consumers on the best product options available.

5. Restructure businesses to favor job creation and preservation, and to reduce environmental impact. Worker co-ops, as envisioned by University of Chicago philosopher David Schweickart, are governed by workers and capitalized from a public fund rather than private shareholders. The result is greater priority to job preservation, even as the co-ops operate in a competitive market system that requires efficient operation. Additional incentives, such as requirements for a minimum share of recycled content in products manufactured, could give Schweickart’s vision a green twist.

6. Explore the implications of a (partial) consumption shift from the realm of private to public choice. Capitalist economies thrive on making available a bevy of private choices. Think of private automobiles versus public transit, or private swimming pools versus municipal pools. In transportation, a multiplication of vehicles (millions of cars instead of thousands of buses or rail cars) doubtlessly creates more manufacturing jobs. Yet public transit involves a large number of employees running systems. The net job benefits will vary from one sector of the economy to another, and the public option may not always be the best from a jobs perspective. Yet a fundamental examination of public versus private options seems in order. Creative thinking about public provision of goods and services, as seen in the experiment with co-production—involvement of public agencies, their clients, and the larger community in the provision of services—could have some interesting employment benefits as well.

Creating vibrant green economies that provide adequate employment without depending on endless consumption as an engine of growth will require tools of all kinds and sizes, from the structure of business to incentives created at the national and international level. Although not intended to be an exhaustive list, the above ideas are our starting set. What do you think? What would you add, delete, or change? Keep the conversation going.

consumption, economy, extractive activities, government, Jobs and Environment, Policy, principles, resources, taxes, waste, workers