"Green" Weatherization claims don't add up

August 25, 2010

In a news announcement yesterday, Seattle Mayor Mike McGinn unveiled the Seattle Jobs Plan outlining a series of City-run programs, such as an energy efficiency weatherization program, that he believes will stimulate economic growth and environmental protection.

According to Mayor McGinn, the City of Seattle will use $26 million dollars from the U.S. Department of Energy to ramp up Seattle’s energy efficiency program.  The City’s Job Plan notes that the funding will provide:

“…incentives and financing tools to rapidly increase the demand for retrofits while simultaneously increasing access and training for low-income residents to become skilled workers.  The funding will put up to 2,000 people to work in the green jobs retrofit industry and will help residents and businesses save energy resources.”

Unfortunately, a closer examination of other existing weatherization programs in the state, as well as “green” job claims, shows that such claims are often overzealous and overstated.  The Following are four examples of how “green” job claims are misguided.

First, research shows that a focus on “green” job creation can cost jobs in other segments of the economy.  A Spanish economist found that for every “green” job created 2.2 jobs elsewhere were being destroyed.  The study, in part, found that taxation on other industries to pay for politically favored programs led to the loss of jobs in other economic sectors.

Second, there are serious questions that arise on the validity of the claim that 2,000 jobs will be created by spending $26 million, especially as long-term sustainable jobs.  Earlier this year we examined similar claims by Governor Gregoire when she announced $16.5 million for energy efficiency related grants to create 2,000 jobs.  The average salary range for each of these proposals would be $8,250 to $13,000, assuming each created the promised 2,000 jobs.  At this rate, these are hardly sustainable jobs.

Third, existing weatherization programs have failed to create the jobs promised.  The 2009 Legislature created a pilot weatherization program that has allocated more than $14 million to weatherize homes and create family wage jobs.  Onerous rules, however, such as a requirement to pay prevailing wage has increased costs and stymied job creation.  While the pilot program is new, data shows that job creation is slow, at best.  To date the pilot program reports that $1.4 million has been spent to complete 615 energy audits and 100 retrofits of homes.  The pilot program also reports 59 FTE’s (non-labor related), but it is questionable whether or not these jobs are new because of the weatherization program. 

Similar results are being experienced in other places, such as Boulder, Colorado.  A report in the Wall Street Journal noted the difficulty the City of Boulder has faced in trying to implement weatherization programs.  According to the Journal, “Boulder has found that financial incentives and an intense publicity campaign aren’t enough to spur most homeowners to action....”  Dr. Roger Pielke, the Keynote Luncheon speaker at our Environmental Conference in July, added, “If a place like Boulder that regards itself as a being in the environmental forefront has such a tough time, these types of efforts are not going to work as a core policy.”

Finally, the state’s own study on “green” job creation shows that the state is not creating new jobs, but just relabeling existing jobs.  The state’s report says, “…it seems unlikely that a large proportion of the increase in green jobs is due to new hiring.”

Policymakers continue to promise new “clear-eyed” approaches to stimulating job growth; unfortunately, what we tend to see is the same recycled “green” rhetoric.