An unavoidable consequence of the war in Ukraine will be shifting energy supply chains globally. European Union member states dependent on Russian oil have already voiced a strong desire to establish better energy security. In the short-term, that will require burning greater quantities of fossil fuels. European consumption of imported natural gas and coal are expected to increase as EU imports of Russian oil are slowly phased out by 2027. In the long-term, however, the EU has indicated that renewable energy will fuel energy security on the Continent.
America’s relationship to Russian oil is less precarious than that of our neighbors across the Atlantic. The war has caused gas prices to skyrocket — which often harms low income Americans the most — but has not endangered our long-term energy supply. We only imported 8% of our crude oil from Russia in the year preceding Biden’s import ban and, furthermore, we are net exporters of energy. Even so, the U.S. attitude toward action abroad for greater renewable energy should not be indifference. America ought to seriously evaluate whether we are on track to successfully transition to renewable energy alongside the rest of the world.
Aggressive climate policy is a top priority for the Biden administration. Last year, President Biden announced a plan to decrease emissions by 50% (from 2005 levels) by 2030. To achieve this ambitious goal, rapid investment in solar, wind and other renewables will be necessary on a massive scale. At the same time, Biden’s industrial policy — protecting American industry from foreign competitors and bringing industrial plants back to America — has the potential to frustrate his climate goals if it is not executed strategically.
Policy decisions affecting the solar power industry illustrate the tension between the interests of labor and swift climate policy. President Biden wants a rapid shift to clean energy, but at the same time wants American solar manufacturers to play a major role in that shift. To demonstrate his commitment to American labor, Biden extended and amplified Trump-era “Buy American” economic policies aimed at protecting manufacturing jobs, including jobs in the solar power industry. In practice, that has meant the continuation of tariffs levied on solar panel components imported from China.
Because Chinese polysilicon, a major component of solar panels, is much cheaper, tariffs imposed on Chinese imports lead to increased costs for firms installing solar panel fields and slow down the pace of increasing America’s solar power capacity. Because of this complication, tariffs of this nature are generally not popular among economists. However, President Biden’s (and Trump’s) concern about the economic well-being of manufacturing workers is not misplaced, only misdirected. Advocates of the transition to solar tend to make the argument that because the burgeoning industry will create jobs, those working in fossil fuels stand to lose nothing in the transition. Though the “more jobs” claim is correct, the second — and arguably more important — claim that solar jobs are just as good is not.
The American Federation of Labor and Congress of Industrial Organizations, or AFL-CIO, a prominent U.S. labor union, came out against the Green New Deal when it was pitched in 2019. Although other unions supported the bill, AFL-CIO’s leader, Richard Trumka, was concerned about what the legislation as written would do to the livelihoods of fossil fuel workers. Evidence suggests his worry was warranted. Currently, the average compensation for California fossil fuel workers is $130,000 (including benefits), while the same figure for solar power workers is roughly $86,000. Comparing wages across these industries nationally tells a similar story, with oil workers making roughly $27 for every hour worked, compared to an average $24 an hour wage for solar workers. Without labor laws that strengthen the position of labor unions in the clean energy industry, a hasty transition to solar energy would give hundreds of thousands of workers an effective pay cut.
Opening up trade with China is essential to the future of American renewable energy. China has long been dominant in the race to produce solar power; continuing to protect American solar manufacturers is a noble, though idealistic, project. Even so, the Biden administration must work to ensure that the interests of the new generation of workers in the clean energy industry are not ignored by providing the legal backing necessary for unionization. The transition to green energy will not be painless, but it is inevitable. Striking a better balance between rapid development and fair labor conditions must become part of that transition.
Alex Yee is an Opinion Columnist and can be reached at firstname.lastname@example.org