The Employment Impacts of a Low-Carbon Fuel Standard for Minnesota

Garrett-Peltier estimates the employment impacts of a low-carbon fuel standard (LCFS) in the state of Minnesota. She develops three scenarios by which the demand for transportation fuels in the state could change by 2021, and further to 2035. Under each scenario, she estimates the number of jobs that could be created in construction and manufacturing as the transportation fuel infrastructure expands, as well as the number of jobs that could be created in harvesting, transportation, and production as the supply of alternative fuels expands. She finds that a LCFS would significantly increase the demand for alternative fuels such as corn-based ethanol, cellulosic ethanol, and bio-diesel, as well as increasing the demand for electric vehicle charging stations and alternative fuel blending pumps. Over the next ten years, enactment of a LCFS could result in the creation of over 7,500 jobs building alternative energy capacity and infrastructure. In addition, over 1,200 jobs could be created in harvesting, transporting, and processing transportation fuels. When she extends the analysis to 2035, the author finds that a LCFS could create over 32,500 job-years in manufacturing, installing, and building renewable energy infrastructure and capacity, and an additional 12,000 jobs could be created in the ongoing production of this level of alternative transportation energy. Finally, in addition to the substantial net employment benefits, employment in the state’s oil refining sector decreases slightly under a LCFS, but losses are more than offset by the significant employment gains in ethanol.