Greenpeace has recently released a report proposing an “energy revolution” to cut greenhouse gas emissions without the use of either clean coal or nuclear energy. There’s lots of things to pick apart in the report – insanely optimistic timelines, a rather touching certainty that we’re going to run out of uranium, and a rather naive belief that technological development proceeds linearly were three that struck me – but there’s one section that illustrates a broader point on how economic conditions have changed.
The Greenpeace report contains an analysis of the likely effect on employment of their energy revolution, which purports to show that any employment loss in the fossil fuel sector will be more than made up for by job gains in renewable energy and energy efficiency. Notably absent is any consideration of what the employment effects in the wider economy might be, not to mention any analysis of what impacts on household income their scenario might impose. But even that’s not what’s really odd about the document. It’s the seemingly innocuous assumption that more jobs are necessarily a good thing.
At the moment, Australia is importing pretty much all the skilled labour it can get its hands on. It’s even getting to the point where there’s considerable pressure on the government to allow unskilled guest workers, from the Pacific Islands and even East Timor. It seems every specialist trade publication in the land features employers complaining about the difficulty of getting staff. While there’s undoubtedly a level of self-interested exaggeration here, Australia is closer to full employment than it’s been since the 1970s. And the demographic trends seem likely to work in favour of employees over the next couple of decades, as the Baby Boomers are finally put out to pasture.
As I understand the current situation, we have to turn the assumption of the 1970s and 1980s – that net job creation was always good – on its head. Right now, creating jobs is likely to just take employees from one employer to another, rather than result in a net gain in employment. Creating more jobs to create the same product will be a net drain on our well-being, not an improvement.
Reminds me of the (apocryphal?) story of the economist who visits China under Mao Zedong. He sees hundreds of workers building a dam with shovels. He asks, “Why don’t they use a mechanical digger?” “That would put people out of work,” replies the foreman. “Oh,” says the economist, “I thought you were making a dam. If it’s jobs you want, take away their shovels and give them spoons.”
Doesn’t more jobs signify at some level less efficiency?
Wilful, check out Robert’s last line.
Robert, where do they say it’s necessarily a good thing? It looks to me like they’re following through the assumptions of the model.
DK: it’s the only economic issue that they seriously analyzed. They didn’t report any analysis on costs to households for instance.
Furthermore, you have to interpret this as a marketing document – they’re trying to sell their policy prescription (which is a perfectly appropriate thing to do and what their members expect them to do). So why would you spend time talking about positive impacts on job creation unless you thought that was a selling point?
Robert, you are absolutely right that jobs are not necessarily a good thing, and that the amount of jobs in the whole economy is what matters.
As far as the rest of the report goes, I think there were many aspects of it that were quite conservative, using data from the IEA. Their fossil fuel price projections are extremely low, especially for crude oil; their carbon cost projections are also very low. Increased fossil fuel prices will lead to renewable energy being much more competitive, and the renewable scenario costing much less compared to BAU.
While the assumption that learning curves for renewable technologies are linear on a logarithmic scale may or may not be true, I can’t think of a better assumption to make about their costs. I think the main issue is that because costs are so uncertain it is silly to project the cost of anything to 2050 unless you have massive error bars. I also don’t much evidence of insanely optimistic time lines, except for the 600 MW of Solar PV by 2010…
With the proviso that higher fossil fuel prices will result in reduced carbon prices…
Personally, I reckon the long-term price of carbon is whatever it costs to take it directly out of the atmosphere and sequester it.
As far as the insanely optimistic timelines, I’m referring specifically to their 2020 targets. I simply don’t think you can get that kind of renewables market penetration in that timescale without going on something akin to a war footing, particularly when they’re factoring in absolute cuts in energy use. And I don’t think that’s politically doable.
“Doesn’t more jobs signify at some level less efficiency?”
Absolutely yes – it means those working are less productive and therefore, in the long run, lower paid.
That people can’t see this drives me crazy – it’s a fallacy (a fixed amount of work to be done) that leads to all sorts of really bad policy (notably protectionism). We should always be looking for ways to get the job done with less human effort – that is, with fewer jobs.
I think their assumptions are about the cost rather than the price of carbon. They are factoring this cost into the cost of fossil fuel generation, I don’t think they look into the price of carbon required for a particular amount of emission reductions.
I had a go at using their estimated investment costs for 2010 for each technology to estimate the investment required for the additional capacity of renewables and gas by 2020 (I didn’t look at the generation costs). I came up with a figure slightly under $70 billion, which would be invested over 12 years. I have no idea how accurate their investment cost estimates are, but in any case $70 billion is a very small figure. It is certainly less than a war footing, which I would consider to be 5-50% of GDP.
It is time to face up to it and admit that Hansen’s prediction is inevitable. We are “toast”.
http://www.smh.com.au/news/global-warming/last-chance-or-were-toast/2008/06/24/1214073221343.html?sssdmh=dm16.321266
It does not matter what any report says, “reason” will prevail, and paralysis is the consequence. I wonder how much reasoning was going on on the Titanic before it slid into the depths?
The human race knows how to build very well, but we do not know how to unbuild. We do not know how to back down, change direction, rethink. Individually we can, but collectively it seems to be impossible. It may be that the machinery of our western success, capitalism and democracy, are to be the instruments of our failure to act communally in the one crisis that threatens our entire community.
There is only one issue that Kevin Rudd should be addressing. And that is the issue of environment. This is the issue that requires unique leadership. If he fails to recognise this then he has failed as a true leader.
For every other issue there is an army of committed and experienced people to work through the challenges and keep the machinery running. But there is one issue, only one issue that can jeopardise every aspect of our lives. Global Warming. And this is an issue that requires the undivided attention of a true problem solving leader.
Our Captain is attending to the place settings in the dining hall as our ship steams steadily forward towards certain collision with a fate that I do not want to contemplate.
Wake up Kevin Rudd, wake up, WAKE UP………
For the past twenty years the green movement’s critics said we were a threat to jobs. During this whole time the left mostly sat on the sidelines as fossil fuel funded think-tanks did the jobs vs environment and climate skeptic hatchet jobs.
Those on the left who did engage, were split 50/50 between having an appreciation of the ecological critique and having some anti-green stance, mostly about jobs but sometimes on other spurious grounds (greens are essentialist, romantic, anarchist, bourgeois, un-theoretical or some bastard combination of these sins).
So reading Robert Merkel attack Greenpeace (from where I am on leave) for being too pro-jobs is a bizarre shifting of the goal posts.
Three points about the global report that the Greenpeace report is based on 1. The model is deliberately conservative, eg. using IEA assumptions and not counting on likely next generation technologies. 2. This conservatism has meant that each iteration of the scenario demonstrates that Greenpeace has under-estimated growth in the renewables sector, which adds somewhat to its credibility.
Robert,
You say that “Creating more jobs to create the same product will be a net drain on our well-being, not an improvement.” but it’s not the same product: one product (energy from fossil fuels) comes with toxic side effects which could kill us, the other doesn’t. You can hardly leave that out of the equation.
I’m also not convinced about this full employment stuff – we have an enormous number of people in part-time, low-skilled, casual work – which might suit many people while the economy is booming, but I’d like to see more full-time, skilled, continuing jobs, such as the ones Greenpeace suggests could be created.
Dan Cass: it’s not the 1970s any more. Your organization’s report is a half-baked marketing document whose employment analysis isn’t worth the electrons I used to download it.
If you don’t get that the world has changed since the 1970s (hint: counting jobs was never a very smart way of assessing policy decisions, and it’s even dumber now) it’s your problem, not mine.
Yes, Dan, the anti-Greens “environment versus jobs” meme was always largely bulldust, just like Greenpeace’s “environment and jobs”. In all but the very short term what determines the number of jobs has little to do with how productive they are. If anything the more efficient our use of resources is, the higher wages are and hence the more people want to work.
It’s about overall living standards. Greenpeace would do much better spruiking the Stern-type economic modelling showing that well crafted emissions policy, using market mechanisms, would have surprising litlle effect on our material standard of living. Our common foe here is the industry denialists who are concerned with their own personal short-term living standards rather than the longer term living standards of the whole society.
Dan: I’m sorry for being rude. I disagree strongly with the organization you’re on leave for, both in its tactics and many of its positions, but that’s no excuse for me getting personally cranky at you.
That said, I stand by the substance of my critique, which has been expressed much better by DD.
When considering the economic impact of a move to renewables and away from fossil/nuclear energy and the associated mining/export practices in Australia the example of Austria springs to mind.
In Austria, there have 80% renewable electricity generation, no nuclear power and a much higher GDP per capita than Australia. They have buses running on this electricity, are rolling out electrical courier and emergency vehicles and have pedestrianized city centres. They can also afford free university education, pay the unemployed 80% of their previous wage with no obligational mutualisation and dont tax booze. Obviously, insisting on beers with head on them like the Alps and other dodgy Austrian traits we don’t need to copy.
Thus, the economic impact of a switch to renewables in Australia will create a better and more wealthy form of social capitalism if it occurs. People could then live in or near major population centres rather in mining and (hopefully phased out) cattle industries if they choose.
A moratorium on immigration until this change can occur would help Australia meet its emission target as each Australian with their fossil fuel powered lifestyle is currently a blight on humanity. Re-educating people who made their fortunes through mining or fossil fuels such as the Forrests and the Libermans etc (and their associated workforce), that their moronic behaviour is now costing the earth is a priority. Yes we are taking the Kingswood and we are taking it to the non-visy renewable powered recycler and not building another.
A further example is Latvia where a Green party is in government, and the economic growth rate is phenomenal (mind you this is partly due to a switch towards monetary capitalism).
Furthermore, Cass et al the idea that Green politics and conservation was formulated in Australia in the last 20 years, with the founding of the Tasmanian Greens is basically a short sighted view. The shamanic connection to nature amongst the ancient and contemporary Lithuanian etc peoples (many of whom still live in ancient forests) where Truchanas (who inspired the Tassie Greens) sprang from may give the debate a somewhat more elongated perspective.
Parkos – I guess Austria is lucky that hydro is a mature and reliable technology and that they’ve got alps! But I’ve never thought of the Viennese as being a particularly spartan crowd and no doubt if they were within easy driving distance of fabulous beaches they’d be buzzing back and forth just as often as they could.
Solar energy is as old as the sun..
Some of those rocky Croatian nudist beaches are being bought up by the Wiener Borse boys as this is being read, if this sours their marital relations they may invade France again and take over its nuclear arsenal by which time a new set of environmental problems will be apparent. I hope this has not given them any ideas..
I’ve noticed this Greenpeace line a few times now. “Renewable will create heaps of jobs and money, hooray!”
So according to Greenpeace, jobs and arch-environmentalism are happy bedfellows.
I just wish I could say the same about Greenpeace and the oldest debunking of this type of fallacy on record.
BilB, from the article you linked to:
There’s more of James Hansen at Huffington Post.
parkos, CIA World Factbook has Australia at $36,300 per capita GDP and Austria at $38,400.
Higher, but perhaps not “much higher”.
I don’t think clean jobs are bad. We are really talking about a transition from dirty jobs (e.g. coal fired power stations, coal mining etc.) to cleaner jobs (e.g. installing solar panels, making them etc.). There may be more jobs, or there may just be a shift to green jobs.
The ABC reports that CSIRO seems to think there will be a big increase in green jobs, and a need to transition to them:
Millions of ‘green collar’ workers needed by 2015: report
Regarding the Energy [R]evolution report by Greenpeace, I think it is quite conservative in terms of both emission reduction targets and renewable energy uptake. They have adopted this conservative position in an effort to be taken seriously in the corridors of power. However, the main risk is that we need a more rapid transition to a greatly reduced (or zero) carbon economy.
Emissions trading won’t necessarily reduce emissions. Nor will an MRET that is not met.
The basic test for initiatives is “will this reduce emissions now, measurable immediately when implemented”. If yes, then we should do it. If not, then we shouldn’t.
This will off course take some guts and leadership to do, and I am afraid that our political system really can’t achieve this. I think we need to take energy management and climate change out of the hands of politicians and set up an independent rational science-based process to handle it. Free from political and vested interest lobbying interference.
Firstly this Greenpeace report is far too conservative, and drives the environment movement backwards. Robert Merkels arguments are ridiculous to say the least.
The IEA reports that 17% of all power on earth can be by Wind Power, That’s not electricity that’s power.
http://www.renewableenergyworld.com/rea/news/infocus/story?id=52837
or
Energy Technology Perspectives
http://www.iea.org/Textbase/techno/etp/index.asp
Now for Australia, a country with 1 of the better wind resources in the world ie an almost limitless supply of 30%-50% wind sites, we would be best aiming for 50%+ wind power as a conclusion you draw from this report.
Now given that the job market may be constrained — however this could change, the beauty of wind power is we can either provide incentives for the turbine manufacturers to build most of the content here, using Australian Steel, Copper, Concrete and Aluminium or we can make as much of it as we want here. Common wind components that can be either imported or made locally include Nacelles, Bearings, blades. Usually you import the generator but it too can be made locally and you almost always build the towers locally.
So renewables are dynamic, and get be rolled out with minimum constraints on supply of Labour or with market incentives more workers can have jobs, such as setting up manufacturing lines in the Latrobe Valley for workers who are dislocated from the closing down of the coal industry.
In terms of job effects and costs — we’ll all be wealthier because local pollution at coal power plants costs the earth — even without looking at CO2. Ie 7 times the national cancer rates in the Latrobe Valley, Biggest sources of Mercury to oceans and related respiratory conditions.
Another thing that was not looked at was the IEA report on using heat pump (air conditioners running reverse cycle). Which for instance yield 300% of the heat delivered to a house than heating directly with gas.
Report by IEA to save 8% of global emissions here omn the IEA/OECD heat pump website.
http://www.heatpumpcentre.org/
Regards,
Matthew
Also, there’s no point in running with conservative IEA projections. Where-ever we have to go, it’s not from there.
The New Global Growth Path: Implications for Climate Change Analysis and Policy
The point about doing without carbon capture and storage (and mothballing nuclear) is a fantasy concocted from the part of the world who already has access to a good standard of living and environmental regulations better than in most developing countries. If you’ve ever been to Bonn and listened to the Chinese, Indians, Brasilians etc say you in the west have a high standard of living, we deserve that too, we’re developing first and we will address climate change while we are doing that, the traditional high moral ground of the old green movement doesn’t seem too attractive. I don’t like nuclear, but I like preventing people from access to livelihoods less.
Arguing on a purely parochial basis seems to me to miss the point. This is why I’m not keen on immigration policy that does not have an international outlook – the whole world needs to reduce its footprint, not those of us holed up in Fortress Australia. Green Fortress Australia might be better than brown Fortress Australia but it is no real solution.
However, where job creation does have a pretty good outcome is when brown jobs become green (having once been directly involved in creating new “green” jobs in the 80s). As a rule, they should be better and more satisfying. So, rather than more, we should be thinking better.
But more jobs are needed in Ghana, Upper Volta, Guatemala and so on. I don’t think we need to steal engineers from developing countries to build more PVs if there is a more efficient way to have them use their skills sustainably in their own countries, and at a higher standard of living, too.
Now how do we do that? Jeez …
Roger, I reckon I agree with all that. The Chinese all want to drive cars, it seems. They shouldn’t, but who are we to tell them?
The problem is if we reduce emissions and they continue to increase so that we meet in a ‘contraction and conversion’ sense there will be an overall increase of significant proportions. Then we all go down together, in both senses.
I’m pretty much where you are on nuclear. I don’t like it and I think we should do it here if geothermal can be cranked up.
Geosequestration can’t be relied on as a magic bullet, but would be handy and may play some role. In short it’s still worth spending money on.
Thanks for the apology Robert!
I’m new to blogging because I’m old fashioned – I think the anonymity drags everyone’s standards down and makes the online “community” far less substantial that it likes to think it is.
Anyway, point of debate : naively scientific environmentalism has no social policy values apparently and would be quite happy to go with any decarbonising technology. That’s why naively scientific environmentalism is about as silly as naively scientific liberalism, conservatism etc.
I’m no labor economist but it seems like an all-round good idea to use every policy lever we can to create skilled, Australian jobs that build climate friendly technologies, at the expense of the fossil fuel industries, quickly. I’m yet to be convinced this is a bad thing.
PS I hear Peter Singer put all this in a useful context in his recent Melb Uni talk
http://harangue.lecture.unimelb.edu.au/lectopia/lectopia.lasso?ut=755&id=51257
cheers, http://greenfunkdan.blogspot.com/
The McKinsey Institute has released a new report on reducing global greenhouse gas emissions and creating a “carbon revolution”. It has quite a bit of cost curve analysis and seems quite well researched.
Thanks for the link the the Peter Singer talk Dan.
Its a pleasure, Laura.
If its for your students, I hope it stimulates their thinking in all the right ways.