What impact can a federal stimulus package have on the creation of green jobs?
There are two categories of employment that we should distinguish between: short-term and long-term employment opportunities. The short-term ones are obviously the coin of the realm right now. In terms of job creation, I think the stimulus package is really going to try to target employment-intensive development, mainly in construction-oriented areas. If investments are mde for the New Economy, enhancing productivity, long term employment gains will follow.
What types of projects might be best for California?
The current policy is intended to fight a recession, so the Administration will be particularly interested in short-term job creation with so-called “shovel ready” type projects. For energy, I think the best candidate in California is energy infrastructure.
In an upcoming report we’re looking at the “super grid” idea for California, developing an integrated energy distribution network for the digital age. Basically, electricity started out illuminating light bulbs. Now energy is really focusing on illuminating people with digital information content.
We need an energy infrastructure that's fully integrated, that doesn't just move electricity for machinery and industrial use, but also moves all energy-related services, including media and other information content. Some examples would be home monitoring [of electricity usage] and energy efficiency. A new super grid would be a classic megaproject like the TVA for the digital age, something that really focuses on restructuring energy services for the whole California economy.
I think California can market itself as the test bed for this on a national basis. We're out in front in the energy technologies, were out in front in the information technologies, and we've got very forward looking utilities who will participate. California is a really good candidate for a megaproject to establish a new digital age electrical power network.
What would this involve - it’s more than stringing lines, right?
What this means is not only linking the bedrock power sources, like traditional power plants, but integrating the grid with renewables, which are now orphaned from traditional energy sources. The existing grid grew from demand centers outward, so it’s where the traditional sources are. Renewables are located now in places like the Mojave desert (solar), hilltops and ridges (wind), and remote mountain areas (geothermal). These all need to be integrated into a grid for delivery to demand centers.
On the demand side, we have an ad hoc patchwork of electricity services that are part of the established grid. Both are 1950s era systems in the way they handle energy. They deliver it to households, and households use it. There’s no monitoring, no “smart” home or enterprise energy management technologies are integrated.
Technology centers, biotech centers and other high end users each have different but critical Digital Age energy requirements. We haven’t entered a space race type of situation yet, where we promote innovation from end to end for this technology.
What would this mean to the economy?
It would be employment intensive at the outset, requiring all kinds of workers, from basic construction services to the most esoteric levels of IT. The long-term energy efficiency gains would pump money into the economy and stimulate employment across all sectors.
For example, the money households save on energy would be spent on haircuts and espresso drinks rather than going into the carbon fuel supply chain. When energy savings free up money to spend, we end up with what I call indirect job creation. These are green jobs but not green collar jobs. And they make up the majority of green jobs, and most are in services, where jobs cannot be outsourced.
There are three phases of green technology development: design, fabrication and adoption/implementation — or installation. Phase one and three can be captured domestically. Phase two is likely to be outsourced to more competitive labor markets. I don’t see this as much of a problem. Biotech and IT hardware products may be made in China, but the industries and their downstream retailers are very profitable here.
Even if solar panels are not made here, phase one and three can be very lucrative. What California needs to do is capture the innovation potential and really establish energy efficiency as the next knowledge-intensive factor after IT and biotech.
At the Green California Summit, policy makers, agency chiefs and others involved in green government network and learn about the latest technologies and regulations. What should they consider at this time?
Now is the time that all eyes are in California, watching to see what we will do. Washington is now moving beyond the denial phase on climate policy, and national leaders will be turning their heads towards California. We have to provide a roadmap for energy efficiency and intensive New Economy job creation.
We cannot relent on this because of temporary low energy prices. Energy prices are being driven down by demand side forces, but global scarcity will come right back and bite us when economies recover. We’ll need a lot to invest in when it comes to climate change. We have to protect ourselves against it. There are a lot of assets at risk. We have two airports in Bay Area, for example, that are within two meters of sea level. We have to start right away planning for how we want to adapt. There’s a lot to do and, with planning, the state can spend its stimulus money very productively and set an example for the nation.