Center for American Progress Reports 625,000 New Jobs Possible

A new report this month, under the auspices of the Center for American Progress – a nonprofit, nonpartisan think tank – and Energy Resource Management Corp. (an energy investment firm), states that energy efficiency is one of the most promising paths to jumpstarting the faltering economy and creating jobs.

Called “Efficiency Works”, the 56-page report – highlighted in a conference call by Senator Harry Reid (D-NV) on September 7 – suggests that energy efficiency mandates could create 625,000 new, permanent American jobs.

This estimate, based on retrofitting just 40 percent of the nation’s “energy hog” buildings in both the private and public sector, would save the nation about US$64 billion, which could be pumped back into the economy to create jobs over the next decade. Retrofits to conserve heating and cooling energy would also reduce the nation’s carbon footprint by five percent.

Currently, the report notes, unemployment in the construction trades stands near Depression-era levels, or 25 percent for the entire first quarter of 2010. In the period of 2006-2010, 2.1 million construction-related jobs were lost, with housing starts and other residential construction down by 38 percent.

This means that more than one in three construction workers lost their jobs as the result of this recession. Manufacturing jobs in the wood products sector also fell, by almost a third. These two categories represent some of the best jobs left in America, a nation whose production economy has been increasingly outsourced to countries where cheap labor dominates.

As the report notes, it will take public policy to drive the private sector into investing in energy efficiency, but such mandates at the state level are already paying off. In fact, states with policies mentioned below in place are best positioned to capture more than their market share of the monetary reinvestment and job creation, and also positioned to capitalize on the innovation that creating such a marketplace will inaugurate.

Listing Connecticut, California, Maryland, Massachusetts, New York and five other states as prime markets thanks to their renewable portfolio standards (RPS), renewable energy credits, energy efficiency standards for buildings (think New York City’s “green” building measure), utility rate unbundling, and similar policies, the report also states, without chagrin, that the U.S. lags behind Europe (and Asia) in the dollar amount of energy needed to produce every dollar of goods.

If true, and authors Bracken Hendricks, Bill Campbell and Pen Goodale clearly see no reason to doubt it, this means that the nation’s inefficiency is effectively sapping its economy, and reversing that slippery slope is most efficiently done by reducing the amount of energy consumed – a fact backed by a McKinsey & Company study that shows Americans waste US$130 billion in energy each year.

Finally, with no apparent recourse from the current recession, jobs creation – even in the absence of significant energy savings in the near-term – could reverse the three-year downward financial trend that has even seasoned investors shying away from blue chips in favor of junk bonds that, while dicey, offer returns up to eight times greater than money market funds.

If America is addicted to cheap, polluting energy, does the term “scared straight” ring a bell?

Learn more about Energy Efficiency on eBoom's Emerging Energy Learning Page.