Rocky Mountain Institute (RMI)

By Sam Mardell and Jeremy Richardson - Rocky Mountain Institute, September 15, 2022

Across the United States, the transition from fossil fuels to a clean energy economy is accelerating and will be supercharged by the recent passage of the Inflation Reduction Act (IRA). The clean energy transition is creating widespread social benefits ranging from lower and more stable energy costs to improved air quality. However, without thoughtful planning, the shift to clean energy will harm workers who depend on fossil fuels for their livelihoods, as well as the communities where they live and work.

Policymakers have an opportunity to shape a clean energy transition that supports workers and communities instead of leaving them behind. The fossil fuel industry is central to the economic life of communities across the country, and the real risks these communities face in the clean energy transition — job loss, depressed property values, and reduced local tax revenue for social services and institutions — can be devastating. Well-designed, targeted, proactive, and long-term interventions can help diversify local economies and drive new economic activity that aligns the global need for rapid decarbonization with local visions and priorities.

And governments are beginning to take notice of this risk and opportunity. Over the past few years, seven states passed bills designed to support coal workers and communities facing economic transition. The IRA and the Bipartisan Infrastructure Law of 2021 represent the largest set of investments and resources available to support energy communities in history. These laws could even eclipse 50 years of investments in economic development by the Appalachian Regional Commission.

Building on previous work by key stakeholders, we introduce a policy framework that outlines the risks facing fossil fuel workers and communities in the shift to clean energy and provides guiding principles for supporting them in the transition. RMI’s fossil fuel community recovery and revitalization framework can be used to assess the strengths and gaps in existing legislation and help policymakers and advocates develop and implement comprehensive, strategic policies to support a fair transition from fossil fuels.

RMI’s recovery and revitalization framework consists of three steps:

1. Relief for fossil fuel workers and communities to alleviate losses of local revenue and jobs that occur immediately following fossil fuel facility closure
2. Reclamation of remaining fossil fuel sites to prevent prolonged pollution risks and promote short- and medium-term job creation and local economic activity
3. Reinvestment in fossil fuel communities to promote long-term economic resilience and diversification