A Blog by Jonathan Low


Jan 18, 2015

There Are Now as Many Solar Jobs as Coal Jobs in the US

A funny thing happened as the ideological assault on solar energy caused many to question its efficacy and staying power: it continued to grow. In fact, it grew so much that it now employs as many people in the US as does the coal industry.

This is not, at the moment, unalloyed good news. Despite the evidence that many people are finding solar a logical alternative to fossil fuels, at least for powering their homes, the growth in employment is a signal of inefficiency given the relative ratio of workers to the medium's contribution to energy output. But before it is written off yet again by those philosophically predisposed to doubt it, it is worth noting that most new technologies were and are similarly inefficient in terms of resource allocation.

The reality is that as experience with solar grows - design, installation and management - the cost curve will come down. Solar is here to stay and given its current financial status, is likely to grow as the underlying economics improve. JL

Brad Plumer reports in Vox:

The combination of cheap natural gas and new air pollution regulations really is shrinking the coal industry. But measures to bolster cleaner energy are also creating jobs elsewhere.
Solar power is awfully labor-intensive. You need people to design and manufacture panels. Then people to market the panels to households. Then people to come and install them on rooftops.
The US solar industry employed about 174,000 people in 2014
That means lots of jobs. Even though solar power provides just a small fraction of electricity in the United States — about 0.4 percent — the solar industry employed roughly 174,000 people in 2014, according to a new survey from the non-profit Solar Foundation. And the industry is expected to add another 36,000 jobs this year, as installations keep rising at a tremendously fast pace.
To put that in perspective, 174,000 is roughly the number of people who work in the entire US coal industry, when you add up everyone employed in mining and transportation and at power plants. And coal provides 39 percent of America's electricity — far, far more than solar does.

So are all these solar jobs a good thing?

There are a few different ways to look at this.
From an employment perspective, it's great. The United States has been reeling from a brutal recession, and any source of new jobs is welcome. In 2014, solar companies added positions 20 times faster than the rest of the economy, the Solar Foundation said. These are also decent-paying jobs, with average wages around $20 to $24 per hour. About 55 percent were installation jobs, 19 percent were manufacturing, and 12 percent sales.
Solar power is still far more labor-intensive than other sources
Another way to interpret these numbers, however, is to point out that solar power looks like a pretty inefficient way of creating energy. As one 2012 University of Tennessee study found, it takes far more manpower to generate one megawatt-hour of electricity from solar than it does from any other energy source.
That's not always a good thing. If the world wants to avoid drastic global warming, we need to replace dirtier sources of energy like coal with cleaner sources — like, say, solar — and fast. And the high cost of solar is a real impediment here. Here's Michael Liebreich, head of Bloomberg New Energy Finance, making this point on Twitter:
If anything, Liebreich added, a solar industry that created fewer jobs could be a good thing:
Now, the positive news is that this is already starting to happen to some extent. Analysts expect residential solar systems to keep getting cheaper through 2017, thanks to reductions in "balance of systems" costs — things like installation, financing, engineering, and so on.
One example: As the solar market expands, word of mouth will spread, and it will become easier to find new customers without the need to hire as many people in sales. Solar power, in essence, is contagious.
price of solar power
(GTM Research)
If power plants had to internalize all their social costs, clean energy would fare better
There's another key point here: Solar is far more expensive than coal if you only look at the direct costs of producing electricity. But there are indirect social costs, too. Coal plants produce lots of pollution — soot, mercury, coal ash — that foul the air and water and make people sick. These costs don't show up on electricity bills. Instead, they're dumped on the broader public, in the former of shorter lives or higher hospital bills. Coal plants are also a major source of carbon-dioxide emissions, causing damage through global warming.
If power plants had to internalize all these social costs, then sources like wind, solar, or even nuclear power would be far more competitive — as this 2012 paper by economists Michael Greenstone and Adam Looney explained in detail. (One way to do that would be through a carbon tax on fossil fuels.)
In other words: It would be a major boon for clean energy if solar power keeps getting cheaper and less labor-intensive over time. But getting fossil-fuel users to pay for all the external costs they impose would also make a huge difference.

As the solar industry expands, will it have more clout?

For years, a significant number of US politicians have opposed action on climate change or stricter regulations on air pollution. And oftentimes, this opposition comes in the form of jobs talk: Obama is waging a "war on coal" and killing coal jobs. That worry isn't wholly unfounded. The combination of cheap natural gas and new air pollution regulations really is shrinking the coal industry. And, in areas like West Virginia or eastern Kentucky, that really does mean fewer jobs.
As the coal industry shrinks, its defenders have often cited jobs as
But as the Solar Foundation's report details, measures to bolster cleaner energy are also creating jobs elsewhere. Over time, that may end up creating a bigger constituency for further clean-energy policies (though likely in different regions). A US solar industry that employs as many people as the influential coal industry could have a lot more sway — in Washington and elsewhere.
It's still unclear how that will all shake out, however. Right now, the solar industry is still booming thanks to a 30 percent federal tax credit for rooftop solar systems. But that tax credit is set to expire in 2016 unless Congress extends it in some shape or form. And if the credit does lapse, the solar boom is likely to slow (though it probably won't stop entirely in states that are sunny and have high electricity costs, like California).
It'll be worth watching how the solar industry deals with that over the next few years — and whether all those jobs translate into extra political clout or not.


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