Wherein the Jobs Jobs Jobs Rhetoric Hampers Solar Power Development

Michael Giberson

If you believed what politicians say about green energy and jobs, you probably think they fit together like peanut butter and jelly squished between layers of bread. Has there been a renewable power subsidy announcement or ribbon-cutting ceremony where the word “jobs” was not featured in the first two or three sentences uttered by politicians? When it comes to public policy, job counting is the new measure of policy.

So in the outer suburbs of Phoenix, Queen Creek town officials counted up the jobs associated with a couple of solar power projects proposed to occupy a large bit of their industrially-zoned property with the help of some town economic development funds. Turns out it doesn’t take a lot of people to maintain a large-scale PV power system, and they’re mostly low level maintenance workers. The jobs-counting is giving the town second thoughts about the projects.

Now, in some big-picture, overall costs-and-benefits, thorough and balanced look at energy technologies, that it doesn’t take a lot of highly paid professionals to operate a PV solar power facility is a good thing. It is one of the reason that PV power has such a low marginal cost of operation. But in the kookier world where local economic development, renewable power rhetoric, and taxpayer subsidies collide, jobs are counted as benefits and then the analysis stops.

Two comments: First, PV power remains more expensive than alternative sources of power even admitting the presence of larger external costs for fossil-fueled power plants. We likely would be better off if money currently being used to build solar projects now were spent on additional research instead. Queen Creek may be on the right track, even if for the wrong reason. Solar advocates are promising that grid-parity is just around the corner, so why are we wasting money building inefficient projects now instead of spending that money on getting us around that corner?

Second, the number of jobs a policy is expected to create has very little relevance to the evaluation of public policy proposals. Mostly what matters is whether the benefits of a policy proposal exceed the projected costs (plus, you know, those old-fashioned ideas about the proper scope of government and trying not to infringe on people’s rights).

Environmental economist John Whitehead is right to hope that environmental policy creates few jobs, because, as he explains, it would mean that businesses have found lower cost ways to get cleaner air and water.

3 thoughts on “Wherein the Jobs Jobs Jobs Rhetoric Hampers Solar Power Development

  1. Entrepreneurs don’t try to create jobs, they try to create value. Attempts to create jobs will lose money by definition, creating legions of workers who eventually become dispirited and poor. I think this describes our current government, creating public jobs which will strand millions of people when our finances meet reality.

    Milton Friedman visited a massive government project in Asia. Thousands of workers using shovels were building a canal. Friedman asked why there was no powered earth-moving equipment? An official replied that using shovels created more jobs. Friedman quipped, “Then why not use spoons instead of shovels?”

    A free market of investors and managers directs workers to activities (it “creates jobs”) that produce more value than the resources required to employ the workers.

    Team Obama has no such incentive. The more jobs the merrier, and the wages consumed are marked as GDP and are considered good, regardless of what is produced. The government is indeed happy to build canals with spoons, or alternately, to produce not much of anything.

  2. “We likely would be better off if money currently being used to build solar projects now were spent on additional research instead.”

    Spoken like a true academic. Now, we are better off wasting money on useless research, than we are on wind mills or solar panels, as we will not have to pay to haul the junk away. But, it is still a waste of money.

    What I want to know from anyone who wants to spend research money is: What is it that you want to research? Why?

  3. I think the biggest problem with green jobs rhetoric is that there is no distinction between different types of green policies. Green policies run a wide gamut, and some create jobs and others don’t. Policies promoting energy efficiency create jobs because it is generally labor intensive, and much cheaper than conventional energy, so the money saved can go on to create jobs elsewhere in the economy. But because solar is still somewhat more expensive than fossil energy (assuming externalities are relatively small, as you do) and solar is what most people think of when they consider green energy, those green policies that clearly create jobs get tarred with the “expensive” solar brush.

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