Does reducing energy consumption create American jobs? | Opower ...

Based on recent employment analyses of the automobile industry and buildings sector, the answer appears to be ?yes?: initiatives to increase energy efficiency are important drivers of US job growth.

One report released last week, authored by a group of fuel-efficiency advocates, cites that the US auto industry has grown by 236,000 jobs since June 2009. ?And in Michigan, Ohio, and Indiana, 38% of the total number of jobs added over the last 3 years were in the?auto industry. The report suggests that this job growth has been strongly driven by the industry?s shift toward making cars that have better gas mileage.

The first half of 2012 set an all-time record for the energy efficiency of new passenger vehicles sold in the US ? with the average new car getting 23.8 miles per gallon. One reason for the record-breaking fuel-efficiency of new cars is that consumers now rank efficiency as their highest priority when shopping around for a vehicle. In addition, there is a regulatory motivation: stricter fuel economy standards, adopted by Congress in a bipartisan bill in 2007, have now taken effect and are set to rise to an average of 35.5 miles per gallon by 2016.

What is the mechanism by which higher fuel efficiency creates jobs in the automobile sector? The report discusses three pathways:

• A shift to fuel-efficient technology (e.g. turbochargers, electric power steering, light-weight steel) means more workers ? from research to assembly
• Higher fuel efficiency increases overall vehicle sales, which means an ongoing demand for auto workers: with gas prices and environmental awareness both rising, people are more likely to buy a new car if it is more efficient
• As sales of fuel-efficient vehicles rise, factories will need much higher volumes of advanced components ? many of which will begin to be sourced locally from American workers (e.g. Ford is beginning to produce hybrid transmissions in Michigan instead of Japan)

And do we see the same relationship between increased energy efficiency and job growth in the buildings sector?

Every $1 million invested in energy-efficiency retrofits of buildings creates 17.4 jobs, according to the Political Economy Research Institute at the University of Massachusetts, Amherst.

Another policy analysis, from the think tank Center for American Progress, estimates that if 40% of the nation?s residential and commercial building were retrofitted with energy-efficiency improvements, the associated number of full-time jobs (i.e. to manufacture parts, do the retrofitting, etc.) sustained over a decade would be 625,000. ?And remember, the job creation is just a side benefit: in terms of the primary objective, those retrofits could reduce US energy bills by up to $64 billion per year?or $300-$1,200 in savings for individual families.

Source: http://blog.opower.com/2012/08/does-reducing-energy-consumption-create-american-jobs/

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