The Green Economy Review: Insight into Green Job Developments Worldwide Volume 1. October, 2010

Welcome to Blue Green Canada's Green Economy Review. This is the first installment of a monthly service we are offering to policy and decision makers in Ontario. In providing a brief summary of some key global developments in the areas of renewable energy, green jobs, and green manufacturing, the review will help Ontario’s policy makers stay ahead of the curve. This issue covers the summer of 2010. Subsequent issues will be sent out monthly.

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1. Green Energy Act attracts manufacturers to Ontario

Over the course of the summer, a number of firms announced plans to open manufacturing plants in Ontario to supply the component parts of wind turbines and solar panel installations. The influx of investment and the plans to open manufacturing plants can be attributed to the Province’s Green Energy Act which stipulates that in order to receive the rates offered by the feed-in-tariff, a percentage of the content in renewable power projects must be sourced domestically.

In July, Sun Edison announced plans to team up with Scarborough manufacturer, Samco, to build solar panel racking systems, leading to the creation of 100 jobs. In August, Canadian Solar announced their plans to open a solar module manufacturing facility in Guelph, which is expected to employ 500 people. Also in August, it was announced that Samsung C&T and Pattern Energy had contracted Siemens to provide 600 MWs of wind turbines, and Siemens would be building the province’s first blade manufacturing facility, which will employ roughly 300 people.

Canasia Power Corp, MTorres, GE, and Vestas are all said to be scouting sites in Ontario and more announcements are expected in the coming months.

2. Domestic content in wind projects tops 60% in the U.S

In August, the U.S. Department of Energy released its “Wind Technologies Market Report.” Of note, the study found that an increasing proportion of wind turbine equipment is being sourced domestically. As a fraction of total equipment-related costs, the U.S. content was estimated to be roughly 60%. Despite a troubled economy, the report also finds that overall U.S. employment in the wind energy sector held steady at 85,000 full-time jobs in 2009; of these, 18,500 are estimated to be turbine and component manufacturing jobs. The success of the U.S. may contain some lessons for Ontario as we seek to build the domestic supply chain here.

The report can be downloaded from the DOE’s Energy Efficiency and Renewable Energy site by clicking here.

3. Countries invest in green jobs training programs

A DOE-funded report from the Lawrence Berkeley National Laboratory found that the growth experienced by key segments of the energy efficiency services sector (EESS) is projected to continue and accelerate over the next decade. The report, available here, recommends a number of best practices to help workers find the training they need. As this article in the New York Times points out, the U.S. government is playing an active role to ensure that the U.S. workforce is prepared to handle the growth in the EESS. The Federal government has provided $500M for green jobs training and subsidised some students’ tuition as part of the federal stimulus funds for green courses and training.

As this article from Forbes reports, green jobs training programs are now being offered to inmates in some U.S. prisons. “Green jobs training programs provide a great opportunity for the nation's underserved communities to gain valuable work training to help lift them up out of poverty. This includes individuals that have served prison sentences.” Some 650 inmates are receiving green jobs training in Chicago, as are inmates in San Quentin in California. The funding for these training programs comes from the American Recovery Act.

The Government of South Korea recently announced plans to spend 396 billion won (U.S.$331 M) over five years to train personnel in the green energy sector. In total , the program is intended to provide training for over 100,000 engineers and technicians.

Green jobs training is also on the radar in Ireland after the release of a report which concluded that Ireland could encounter a skills shortage over the coming years if they move towards more sustainable development without training their workforce adequately. The report argues that training for unemployed people should have a green component, apprenticeship programmes should be modified, and other measures should be put in place to ensure Ireland’s workers are ready to fill thousands of green jobs anticipated over the next decade and beyond. According to the authors, "unless a concerted effort is made to upskill our existing and prospective labour force, Ireland risks having a skills shortage scenario or – worse still – risks missing the potential boom that a green economy can offer." Read more here: and here.

4. China is now the most attractive country for wind and solar developers. Canada is 9th

In August, Ernst & Young released their 26th Issue of their Renewable Energy Country Attractiveness Indices. Of note, the report finds that China has supplanted the U.S. as the most attractive country for renewable energy investors. The report, and this article from Bloomberg, suggest that the failure to pass climate legislation in the U.S. is partially at fault. While investors remain uncertain about conditions in the U.S., “China is rapidly developing a market that supports its own manufacturers, ”says Mark Machman, an analyst at Auriga USA in New York. China has set a target of generating 15 percent of its electricity from renewable sources by 2020. They have also doubled a subsidy for consumers who wish to generate renewable energy. In the second quarter of 2010, China attracted $11.5 Billion dollars in financing for renewable energy, which is more than the U.S. and Europe combined. The report can be downloaded at from Ernst and Young

Canada’s ranking remained unchanged at 9th overall. Our score is believed to be the result of the resilience of the financial sector and a number of provincial initiatives, such as Ontario’s Green Energy Act. According to North American Wind Power, Canada's attractiveness could be improved if the federal and provincial governments provided more support for domestic manufacturing.

5. Electric cars in China and Tennessee

China may be the first country to roll out electric cars on large scale. The Financial Post reports that an alliance between industrial manufacturer Eaton Corporation, IBM, AECOM, and others was recently formed to accelerate the deployment of electric vehicles in cities across China. For more details, read release on Eaton Corp's Website.

Closer to home, Electric vehicles are getting a boost in Tennessee thanks to a partnership between the U.S. DOE, industry, utilities and the state government. The state is offering a $2,500 rebate on the first 1,000 electric vehicles purchased, in addition to a federal tax credit of up to $7,500 for the purchase of an electric vehicle. The money available from the state program will come from the federal petroleum violation escrow account made up of money collected from oil companies. Tennessee is one of six states that participate in the national Electric Vehicle Project funded through the U.S. Department of Energy. Read more here.

6. State assistance for clean energy

Off-shore wind development in New Jersey received a boost this summer. The Senate Budget and Appropriations Committee approved a bill to help offshore wind developers finance their projects. And New Jersey’s Department of Environmental Protection issued a study which found that offshore wind projects will cause minimal impact to the coastal waters’ marine mammals, fish and birds. The study may speed up the lengthy permitting process, making it easier for developers to get the go ahead. For more information, click here.

In a bid to attract green manufacturing, California has extended low-interest loans to four solar photovoltaic manufacturers. Morgan Solar, Inc., Solar Power, Inc., Quantum Fuel Systems Technologies Worldwide, Inc., and the Solaria Corporation will receive loans to support purchase of new manufacturing equipment. The loans are to be repaid during the course of seven years following installation of the equipment. “California’s leadership in clean energy technology is supported by these manufacturers who are investing millions to develop and produce advanced energy products,” said Governor Schwarzenegger.

7. More recycling equals more Jobs

Friends of the Earth U.K. released a study in mid-September which reported that over half a million jobs could be created if Europe increased it’s recycling rate to 70%. According to the report, recycling creates ten times more jobs per tonne than sending waste to landfill. The report was issued just a week after President of the European Commission, José Manuel Barroso, called for the creation of 3 million new green jobs by 2020. The report is available for download here.

8. U.S. invests in geothermal

The U.S. Department of Energy has committed an addition $20 million to geothermal projects this year, adding to the $338 million dedicated to geothermal projects last year. The $20 million in funding will go to a group of projects that tap a wide variety of geothermal resources, from large scale to micro-mini. The projects are expected to create a number of green jobs in a variety of settings. Of note, some of the projects are specifically intended to help small towns be more self sufficient, providing both heat and jobs for local residents. To read the release from the DOE, click here.

9. Green economy indexes added to NASDAQ

The NASDAQ OMX Group, Inc. recently announced it is offering “a comprehensive family of indexes designed to track the green economy.” Green Economy Index is said to cover the entire green economic landscape with constituents that are selected across all related industry sectors, including: advanced materials; biofuels; energy efficiency; financial; green building; healthy living; natural resources; pollution mitigation; recycling; renewable energy generation; transportation and water. More indexes are expected to be added in the coming months. Read the release here.

10. China’s pollution to cost at least 2% of GDP

Bloomberg reports that China is set to lose 2% of GDP cleaning up decades of pollution. Failure to spend that much — equivalent to the annual GDP of Vietnam — will likely cost the Chinese government more in blighted crops, health costs and pollution-related expenses. Pollution currently acts as a drag on the Chinese economy, causing lost productivity, lost work days, and a host of other issues. In 2007, the World Bank estimated China’s environmental were around $100 billion a year, or about 5.8 percent of GDP, including the impact on mortality. A combined paper by researchers from Harvard and Tsinghua universities last year estimated air pollution alone contributed to health damages equivalent to 1.8 percent of GDP.

The high cost of pollution will not only hamper China’s economic growth, but it will also raise costs for some industries, such as smelters, as the Chinese government moves to enforce stricter anti-pollution laws.

11. Renewable Energy a hedge against rising oil prices

In 2008, France’s feed-in-Tariff for renewable energy saved ratepayers money. Analysis conducted by Cécile Bordier at the French bank Caisse des Dépôts found that the cost of the French program was declining as renewable generation was growing, and, in 2008, the energy supplied from renewable generation was actually less expensive than conventional generation would have been. Bordier's analysis illustrated what is called the "merit order effect." The merit order effect results when renewable generation replaces more expensive fossil-fired generation at the margin. Previous studies in Germany, Denmark, and Spain illustrated the significant monetary benefit when renewables offset conventional generation. Bordier's analysis was the first to specifically look at France. For more information, click here.