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Analysis: Biden’s clean-energy ‘revolution’ faces challenge to match fossil-fuel jobs, pay

WASHINGTON/NEW YORK (Reuters) - Democratic presidential nominee Joe Biden, seeking to allay concerns that his plan to fight climate change would harm the economy, has promised a “clean energy revolution that creates millions of unionized middle-class jobs” if he’s elected.

FILE PHOTO: Democratic U.S. presidential nominee and former Vice President Joe Biden speaks at a drive-in, Get Out the Vote campaign stop in Coconut Creek, Florida, U.S., October 29, 2020. REUTERS/Brian Snyder

That vision, however, would require policy makers and clean-energy companies to overcome some major challenges in replacing the number and quality of fossil-fuel jobs that could be lost in a transition away from coal and oil.

Union representation, pay and benefits in the fast-growing wind and solar power industries at the center of a clean energy transition lag those in oil, gas and coal, according to data from the U.S. Bureau of Labor Statistics, academic studies and interviews with labor experts and industry officials.

Solar and wind energy installations, once built, also tend to require fewer workers to run than oil and gas infrastructure. And both industries rely heavily on imported components to keep costs down, potentially limiting their U.S. job creation.

Biden’s $2 trillion climate plan envisions a massive shift to cleaner energy sources such as solar and wind over the next three decades. It would also aim to create jobs across a variety of other sectors, including construction, power transmission and electric vehicle manufacturing and charging infrastructure.

The Biden campaign acknowledges the prospect of short-term economic pain as the nation builds a cleaner energy infrastructure.

“There is no doubt we will suffer some job loss because of this transition, but there will be opportunity,” said Lonny Stephenson, a member of Biden’s transition team and president of the International Brotherhood of Electrical workers, a labor union.

Biden campaign spokesman Matt Hill said the candidate would work with labor leaders to “ensure that clean energy investments are creating jobs with the opportunity to join a union across all energy sectors.”

If elected, Biden plans to issue executive orders to boost demand for U.S.-made products and push legislation to help workers unionize, his campaign said. His plan also calls for retraining and other support for traditional energy workers caught up in the transition.

President Donald Trump, throughout his campaign, has called Biden’s focus on climate change a recipe for economic devastation. “Biden’s ‘clean energy’ plan is nothing more than him risking millions of American jobs,” said campaign spokeswoman Samantha Zager.

Selling clean-energy as an economic boon is critical to gaining union support in fossil-fuel sectors, said Jason Walsh, president of the Blue Green Alliance, an association of labor unions and environmental groups, which supports Biden.

“Labor will only fully endorse this shift to a clean energy economy if their rank and file members are getting jobs,” he said.

While Biden has been leading Trump in most national opinion polls heading into the Nov. 3 election, the contest is tight in swing states crucial to an electoral victory.

TOUGH TO ORGANIZE

In North Dakota, where oil-field workers can often make six-figure annual pay, the oil market crash during the coronavirus pandemic has made the prospect of wind jobs more appealing.

Gerard Tessier, 25, moved from Pennsylvania to North Dakota to study to become a wind technician at Lake Region State College. He’s eager to avoid oil’s boom-and-bust cycles but worries about pay in the wind business.

“My hope would be that the industry becomes more unionized,” he said.

The United Steelworkers represented nearly 18% of U.S. petroleum refining, pipeline transportation and pipeline construction workers in 2018, according to calculations of data from the U.S. Department of Labor. By contrast, solar workers are unionized at a rate of 4% and wind sector workers at 6%, according to the 2020 U.S. Energy and Employment Report, produced by a consortium of researchers and state energy officials using government statistics.

Fossil fuel workers also get better pay. Jobs in fossil-fuel power generation range from $70,310 to $81,460, compared with $46,850 to $64,330 for jobs in solar and wind generation, according to the consortium’s reports and 2019 figures from the Bureau of Labor Statistics.

And there’s a benefit gap: Three-fourths of fossil fuel workers get health insurance, while estimates of coverage for clean-energy workers range between 32% and 57% percent, according to Bob Pollin, co-director of the Political Economy Research Institute (PERI) at the University of Massachusetts Amherst.

Compensation is likely to rise naturally as the renewable energy industry grows and faces pressure to attract more workers, Sunrun, the biggest U.S. rooftop solar company told investors in a recent regulatory filing. Wind technician and solar panel installer are the first and third fastest growing U.S. jobs, according to the Bureau of Labor Statistics.

“The unionization of the industry’s labor force could also increase our labor costs,” Sunrun told investors.

But the wage and benefit gaps, at least for now, pose a political challenge for Biden in winning the support of energy workers and lawmakers for an ambitious clean-energy transition.

“I got into fossil-fuel work for the quality of life and the benefits, and the jobs I’m seeing listed in renewables just don’t offer those things,” said Charlie Sandoval, the 36-year old vice president of a local union that represents workers at several Los Angeles refineries.

The renewable energy industry is aware of the gaps and making early moves to address them.

The Solar Energy Industries Association, the industry’s biggest trade group, told Reuters that it is “ready and willing” to meet with union groups to address pay and labor representation.

Democrats are pushing a bill called the Protecting the Right to Organize Act that calls for sweeping change in labor laws. It would, for instance, weaken “right to work” laws in 27 states that prohibit unions from requiring workers to pay dues as a condition of employment. Biden also supports a Democratic bill written by Oregon Senator Jeff Merkley that would offer renewable energy companies a 10% tax credit for providing good wages and benefits.

Stephenson, of Biden’s transition team, said the Democrats might need to take control of the U.S. Senate in the elections in order to pass such laws.

Stephenson said Biden’s plan would also create jobs beyond the wind and solar sectors. It includes goals, for instance, of updating the electric grid, boosting energy efficiency and installing a half million electric car chargers across the country by 2030.

CARS IN THE PARKING LOT

Beyond policy fights, the clean-energy sector faces more fundamental challenges in matching the job creation of fossil-fuels industries. Labor leaders also worry that clean-energy jobs will not be created in the same communities where fossil fuel jobs are lost - or even in the United States.

The U.S. solar industry is highly dependent on foreign manufacturing with imports satisfying about 84% of U.S. demand for solar cells and modules in 2019, according to figures from the Blue Green Alliance. The American Wind Energy Association estimates that between 30% and 50% of a typical U.S. wind project’s value is currently imported.

“That’s not going to cut it if we want to move toward this new green economy,” said Sean McGarvey, president of North America’s Building Trades Unions, which gave a last-minute endorsement to Biden last week.

Wind and solar projects, once installed, also do not require the kind of intensive labor seen at an oil field or a coal mine.

About 800,000 people were employed in the production, transmission, storage and combustion of natural gas and coal for electricity in the United States in 2020, according to the U.S. Energy and Employment Report. That compared to around 350,000 people in wind and solar - almost all of whom were employed in construction or installation, rather than in production or transmission, according to the report.

“I challenge you to drive past an operating solar field,” said Mark Johnson, business manager of the Tri-State Building Trades, representing 50 construction unions in Kentucky, Ohio and West Virginia. “What you won’t see are cars parked where people are working.”

Reporting by Valeria Volcovici and Laura Sanicola; editing by Richard Valdmanis and Brian Thevenot

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