Three universities of the USA have conducted studies related to renewable sources of energy and it has produced some interesting facts. The first and most important one is that renewable energy policies will lead to employment opportunities. Secondly, it will increase the consumer’s income and thirdly, it will have positive effect on the US economy too. The study Clean Energy & Climate Policy for U.S. Growth and Job Creation: An Economic Assessment of the American Clean Energy & Security Act and the Clean Energy Jobs & American Power Act presents quite an encouraging estimate. According to them as many as 1.9 million new jobs could be created across the United States within the renewable energy sphere. It would also account for an increase in annual household income by US$1,175 per year, and Gross Domestic Product could register a rise of US$111 billion by 2020.
The study indicates clearly, “By aggressively promoting efficiency on the demand side of energy markets, alternative fuel and renewable technology development on the supply side can be combined with carbon pollution reduction to yield economic growth and net job creation. Indeed, a central finding of this research is that the stronger the federal climate policy, the greater the economic reward.”
Ceres, Environmental Entrepreneurs and the Clean Economy Network were responsible for commissioning the study and this study was modeled by collaborative research teams at the University of Illinois, Yale University and the University of California. It is becoming obvious that clean renewable energy policies could generate 78,000 jobs in Pennsylvania, 61,000 in Ohio and 45,000 jobs in Indiana.
The main findings of the study concludes, “All 50 states can gain economically from strong federal energy and climate policy, despite the diversity of their economies and energy mixes. The states may differ on the supply side, but on the demand side they all have substantial opportunities to grow their economies by promoting energy saving and domestic renewable energy alternatives.”
The economic estimation was conducted with the help of EAGLE. EAGLE is a forecasting model and it mainly deals in the long term economic impacts of climate legislation on the economy. The model explains about the economic interactions within and between each of the 50 states. This model also does a comparative study of the impacts of combining a limit on carbon pollution with complementary efficiency and renewable energy policies.
According to the study, most American states would experience the increase in growth rates because adopting alternative sources of energy will help in cutting down the use of fossil fuel and exploitation of more efficient alternative energy sources. The study states, “By shifting to domestic renewable substitutes, the western states can reduce their long term external energy dependence and capture more in-state expenditure multiplier effects.”
The model makes certain assumptions. Electric utilities will be needed to fulfill 20% of their sales through renewable energy by 2020. They are also expecting a cap and trade system for carbon emissions and aggressive energy efficiency standards for new buildings and vehicles. The model also presumes that a “substantial program (in the hundreds of billions of dollars)” will come to effect to support RD&D in clean energy and energy efficient technologies, funded in part through CO2 allowances.