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The job generation impacts of expanding industrial cogeneration

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  • Baer, Paul
  • Brown, Marilyn A.
  • Kim, Gyungwon

Abstract

Sustainable economic development requires the efficient production and use of energy. Combined heat and power (CHP) offers a promising technological approach to achieving both goals. While a recent U.S. executive order set a national goal of 40GW of new industrial CHP by 2020, the deployment of CHP is challenged by financial, regulatory, and workforce barriers. Discrepancies between private and public interests can be minimized by policies promoting energy-based economic development. In this context, a great deal of rhetoric has addressed the ambiguous goal of growing “green jobs.” Our research provides a systematic evaluation of the job impacts of an investment tax credit that would subsidize industrial CHP deployment. We introduce a hybrid analysis approach combining simulations using the National Energy Modeling System with Input–output modeling. NEMS simulates general-equilibrium effects including supply- and demand-side resources. We identify first-order employment impacts by creating “bill of goods” expenditures for the installation and operation of industrial CHP systems. Second-order impacts are then estimated based on the redirection of energy-bill savings accruing to consumers; these include jobs across the economy created by the lower electricity prices that would result from increased reliance on energy-efficient CHP systems. On a jobs-per-GWh basis, we find that the second-order impacts are approximately twice as large as the first-order impacts.

Suggested Citation

  • Baer, Paul & Brown, Marilyn A. & Kim, Gyungwon, 2015. "The job generation impacts of expanding industrial cogeneration," Ecological Economics, Elsevier, vol. 110(C), pages 141-153.
    • Handle: RePEc:eee:ecolec:v:110:y:2015:i:c:p:141-153
    DOI: 10.1016/j.ecolecon.2014.12.007
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    Cited by:

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    3. Antonio Molino & Vincenzo Larocca & Simeone Chianese & Dino Musmarra, 2018. "Biofuels Production by Biomass Gasification: A Review," Energies, MDPI, vol. 11(4), pages 1-31, March.
    4. Urbano, Eva M. & Martinez-Viol, Victor & Kampouropoulos, Konstantinos & Romeral, Luis, 2022. "Risk assessment of energy investment in the industrial framework – Uncertainty and Sensitivity Analysis for energy design and operation optimisation," Energy, Elsevier, vol. 239(PA).
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    6. Comodi, Gabriele & Rossi, Mosè, 2016. "Energy versus economic effectiveness in CHP (combined heat and power) applications: Investigation on the critical role of commodities price, taxation and power grid mix efficiency," Energy, Elsevier, vol. 109(C), pages 124-136.
    7. Arvanitopoulos, T. & Agnolucci, P., 2020. "The long-term effect of renewable electricity on employment in the United Kingdom," Renewable and Sustainable Energy Reviews, Elsevier, vol. 134(C).
    8. Cecere, Grazia & Mazzanti, Massimiliano, 2017. "Green jobs and eco-innovations in European SMEs," Resource and Energy Economics, Elsevier, vol. 49(C), pages 86-98.
    9. Flowers, Mallory E. & Smith, Matthew K. & Parsekian, Ara W. & Boyuk, Dmitriy S. & McGrath, Jenna K. & Yates, Luke, 2016. "Climate impacts on the cost of solar energy," Energy Policy, Elsevier, vol. 94(C), pages 264-273.
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    11. Łukasz Jarosław Kozar & Adam Sulich, 2023. "Green Jobs: Bibliometric Review," IJERPH, MDPI, vol. 20(4), pages 1-16, February.
    12. Kyungho Song & Hyun Kim & Jisoo Cha & Taedong Lee, 2021. "Matching and Mismatching of Green Jobs: A Big Data Analysis of Job Recruiting and Searching," Sustainability, MDPI, vol. 13(7), pages 1-15, April.

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