Renewable energy can create jobs, but kills old ones

By Zhang Min
0 CommentsPrint E-mail, July 5, 2010
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The effect that greenhouse gases and the depletion of fossil fuels have had on the environment has pushed low-carbon economies to the front of energy discussions. Developing renewable energy industries will create new jobs, but the transition will also eliminate old jobs. Whether there will be a net gain of jobs has been unclear.

Some Job creation evidence from EU

Some European Union expert groups, independent researchers and non-governmental organizations have presented their low-carbon economy research, which shows there is a positive correlation between the renewable energy industry and job creation. Without a doubt, the EU will benefit by tackling the European debt crisis and encouraging small and medium enterprises to engage in the low-carbon policies. Here are just a few of the available studies in this field.

The first report, published in 2009 by the European Commission's Directorate-General for Energy and Transport, shows that increased support for renewable energy sources (RES) will benefit the economy and create a significant number of jobs. In this study, the researchers used several economic models to show how RES policies affect the EU's economy and job market, how they did so in the past, and how their effects might change in the future.

It makes sense to say that the RES sector is already very important for employment. Future impact analyses show that available jobs should increase by as much as 300,000 over the next 20 years.

The United Kingdom's Department for Business Enterprise and Regulatory Reform released a report that shows there are more than 881,000 jobs within the low carbon and environmental goods and services sector, and almost half of those are in emerging low-carbon industries. Alternative fuels will create at least 162,000 jobs, and wind energy may employ approximately 87,000 people.

Job gains outnumber the job losses

But evidence also shows that jobs will be lost in some traditional fields such as energy extraction and refining; the power sector; and in energy-intensive industries like steel, aluminum, paper and cement. The automotive industry and aviation will also feel the blow.

Out of about 130 million jobs in EU countries in 2006, just 733,000 were in mining operations. According to a report by the World Wildlife Fund, the job gains from renewable energy industries in France will outnumber the jobs lost in the conventional energy and automotive industries by 2020.

China's road towards low carbon economy

This evidence will have significant implications for China's road to becoming a low-carbon society. Although these studies indicate that renewable energy industry and low-carbon economy will create new jobs, it seems inevitable that traditional industry jobs will be lost. However, in working to become a more global nation, China must work to develop low-carbon industry and prepare the economy for growth.

China's transition toward a low-carbon economy should be gradual, and there should be a serious focus on closing the gap between the economy of east China and the inland economy in west China. East China should be financially and legislatively supported by the government at the provincial and municipal levels in an effort to establish and improve low-carbon industries. Some of the inland areas can be used as pilot projects to develop low-carbon industries.

Most importantly, industries should not be allowed to upgrade blindly and abandon the traditional industries that contribute to regional development.

The author is an associate professor with Institute of European Studies, Chinese Academy of Social Sciences.

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