You are here

oil

US Energy Transition Presents Organized Labor With New Opportunities, But Also Some Old Challenges

By Delger Erdenesanaa - Inside Climate News, July 27, 2021

President Biden’s push for “good, union jobs” in clean energy has increased hope that organizing solar and wind workers can close the pay gap between them and fossil fuel workers.

President Biden’s push for “good, union jobs” in clean energy has increased hope that organizing solar and wind workers can close the pay gap between them and fossil fuel workers.

Two years ago, Skip Bailey noticed a lot of trucks from a company called Solar Holler driving around Huntington, West Virginia. A union organizer with the International Brotherhood of Electrical Workers, Bailey saw an opportunity.

“We want to get in on the solar business,” he said, predicting the industry will grow in his home region, which includes historic coal communities in West Virginia, Kentucky and Ohio.

Bailey talked to Solar Holler about unionizing its employees who install photovoltaic panels on homes. IBEW showed the company its local training facility for electricians, and explained the health insurance and pension plans it offers. 

“It wasn’t a hard sell in either direction,” said the company’s founder and CEO, Dan Conant. He was already interested in securing union protections for his employees when Bailey contacted him, he said. The move fit with Solar Holler’s dedication to West Virginia’s legacy of energy production and strong union membership.

“It was not just good business, but it just really spoke to our history as a state,” he said.

Conant and Bailey’s efforts paid off in March 2020, when IBEW Local 317 and Solar Holler signed a contract. It’s just a start—Solar Holler only has about 20 unionized employees—but the agreement is an early example of the future Joe Biden is promising. The president frequently pledges to create millions of jobs while transitioning the U.S. to clean energy. Every time he does, he’s quick to add that these will be “good, union jobs that expand the middle class.”

“It’s a great talking point,” said Joe Uehlein, president of the Maryland-based Labor Network for Sustainability, an advocacy group pushing to unionize green jobs. But he added that Biden faces a difficult balancing act to achieve his pledge. 

Combatting Climate Change, Reversing Inequality: A Climate Jobs Program for Texas

By Lara R. Skinner, J. Mijin Cha, Hunter Moskowitz, and Matt Phillips - ILR Worker Institute, Cornell, July 26, 2021

Texas is currently confronted by three major, intersecting crises: the COVID-19 public health pandemic and ensuing economic crisis; a growing crisis of inequality of income, wealth, race and power; and the worsening climate crisis, which continues to take its toll on Texans through hurricanes, major flood events, wildfires, debilitating heat waves and the significant economic cost of these extreme weather events. These crises both expose and deepen existing inequalities, disproportionately impacting working families, women, Black, Indigenous and people of color (BIPOC) communities, immigrants, and the most vulnerable in our society.

A well-designed recovery from the COVID-19 global health pandemic, however, can simultaneously tackle these intersecting crises. We can put people to work in high-quality, family- and community-sustaining careers, and we can build the 21st century infrastructure we need to tackle the climate crisis and drastically reduce greenhouse gas emissions and pollution. Indeed, in order to avoid the worst impacts of the climate crisis, it is essential that our economic recovery focus on developing a climate-friendly economy. Moreover, there are significant jobs and economic development opportunities related to building a clean energy economy. One study shows that 25 million jobs will be created in the U.S. over the next three decades by electrifying our building and transportation sectors, manufacturing electric vehicles and other low-carbon products, installing solar, wind and other renewables, making our homes and buildings highly-efficient, massively expanding and improving public transit, and much more.

Conversely, a clean, low-carbon economy built with low-wage, low-quality jobs will only exacerbate our current crisis of inequality. The new clean energy economy can support good jobs with good benefits and a pipeline for historically disadvantaged communities to high-quality, paid on-the-job training programs that lead to career advancement. Currently, the vast majority of energy efficiency, solar and wind work is non-union, and the work can be low-wage and low-quality, even as the safety requirements of solar electrical systems, for example, necesitate well-trained, highly-skilled workers.

Read the text (PDF).

Oil well clean-up can create jobs; but not the way Alberta spent Green Recovery funding

By Elizabeth Perry - Work and Climate Change Report, July 15, 2021

The Big Cleanup: How enforcing the Polluter Pay principle can unlock Alberta’s next great jobs boom was released in June by the Alberta Liabilities Disclosure Project . It makes thirteen recommendations, including the creation of an independent, non-profit Reclamation Trust to wind down end-of-life companies and use their remaining revenue to fund the cleanup of their wells. The report states that implementing all its recommendations will create 10,400 jobs and generate $750 million in wages, and contribute nearly $2 billion Alberta’s Gross Domestic Product annually for the next 25 years. The report also includes new calculations and analysis on the growing crisis of Alberta’s oil and gas well liabilities, stating that the average projected cost of cleaning up Alberta’s over 300,000 unreclaimed oil and gas wells is $55 billion dollars, with the top 20 Alberta municipalities alone facing $34 billion in cleanup liabilities in their boundaries.

In April 2020, the government of Canada announced its Covid-19 Economic Response Plan, including $1.72 billion directed toward the cleanup of inactive and abandoned oil and gas infrastructure across the western provinces. $1 billion of this funding was directed to Alberta. Dianne Saxe, the former Environmental Commissioner of Ontario, had been one of the early critics of this program, for example in “Canada’s murky bail-out deal for oil and gas will cost us all” ( National Observer, April 21). In early July, a further evaluation was published by Oxfam Canada, the Parkland Institute, and the Corporate Mapping Project : Not Well Spent: A review of $1-billion federal funding to clean up Alberta’s inactive oil and gas wells . The report finds some alarming failures on many fronts – including that the program is not tracking methane emissions, so it is impossible to determine the emissions reduction impact. Author Megan Egler also cautiously argues that the public funds were used to accomplish what industry should have been responsible for, according to a polluter pays principle.

One of the stated goals of Alberta’s $1 Billion Site Rehabilitation Program (SRP) was to create 5,300 jobs. However, Not Well Spent states: “ If this is met, funding of $1billion will create 5,300 jobs at $188,680 per job. This is $41,800 more per job than money injected into the industry through the Orphaned Well Association to do similar work in 2018. There has been no clear explanation from the Government of Alberta why the public dollars to create one job are higher in the SRP program.” The report also notes that 23% of the total amount of funds disbursed went to only five companies out of the 363; only 10% was allocated to clean-ups on Indigenous lands. The author makes recommendations for improvement in future funding, to ensure better accountability and transparency, which would be more consistent with a “polluter pays” objective.

As the US Pursues Clean Energy and the Climate Goals of the Paris Agreement, Communities Dependent on the Fossil Fuel Economy Look for a Just Transition

By Judy Fahys - Inside Climate News, June 28, 2021

Perhaps the proudest achievement of Michael Kourianos’ first term as mayor of Price, Utah was helping to make the local university hub the state’s first to run entirely on clean energy. It’s a curious position for the son, brother and grandchild of coal miners who’s worked in local coal-fired power plants for 42 years.

Kourianos sees big changes on the horizon brought by shifts in world energy markets and customer demands, as well as in politics. The mines and plants that powered a bustling economy here in Carbon County and neighboring Emery County for generations are gone or winding down, and Kourianos is hoping to win reelection so he can keep stoking the entrepreneurial energy and partnerships that are moving his community forward.

“That freight train is coming at us,” he said. “You look at all the other communities that were around during the early times of coal, they’re not around.

“That’s my fear,” he said. “That’s my driving force.”

New research from Resources for the Future points out that hundreds of areas like central Utah are facing painful hardships because of the clean-energy transformation that will be necessary if the United States hopes to reach the Paris agreement’s goals to slow climate change. Lost jobs and wages, a shrinking population and an erosion of the tax base that supports roads, schools and community services—they’re all costs of the economic shift that will be paid by those whose hard work fueled American prosperity for so long. 

“If we can address those challenges by helping communities diversify, helping people find new economic growth drivers and new economic opportunities, that might lessen some of the opposition to moving forward with the ambitious climate policy that we need,” said the report’s author, Daniel Raimi, who is also a lecturer at the Gerald R. Ford School of Public Policy at the University of Michigan.

Meeting the Paris agreement’s target of keeping global temperature rise “well below 2 degrees C” by the end of the century means Americans must burn 90 percent less coal over the next two decades and half as much oil and natural gas, Raimi said.

And less fossil fuel use will also affect employment, public finances and economic development region-by-region, according to Raimi. In 50 of the nation’s 3,006 counties, 25 percent or more of all wages are tied to fossil fuel energy, he notes. In 16 counties, 25 percent or more of their total jobs are related to fossil energy.

Biden Says He Backs a Just Transition for the Climate Crisis. Advocates Say, “Prove It.”

By Rachel M. Cohen - In These Times, June 2, 2021

While the administration has taken some early steps to provide support for energy workers and frontline communities in the transition away from fossil fuels, experts and activists say the crisis demands a more transformative approach.

One of the most difficult problems that political leaders have faced in addressing climate change has not involved the science or technology, but the politics, including bringing key constituencies like energy workers and their labor unions on board. This skepticism and resistance to change is why a so-called ​“just transition” — referring to an ethical and economically secure shift away from a fossil-fuel powered economy — has become so integral to crafting a successful climate plan. 

Figuring out how to provide economic security for both energy workers that have depended on the nation’s fossil fuels and frontline communities has become a leading priority for activists and elected officials alike. The Biden administration, for its part, has thrown its weight behind developing a just transition, though some advocates tell In These Times that federal leaders haven’t gone far enough, or worry the executive branch’s rhetoric won’t deliver real results. Other researchers have called for more careful study of past economic transitions, as well as more firm commitments around social programs such as universal healthcare. 

On January 27, one week after taking office, Biden signed an executive order establishing an interagency working group focused on addressing the economic needs of ​“coal, oil, gas, and power plant communities.” The group, co-chaired by National Economic Council director Brian Deese and National Climate Adviser Gina McCarthy, is a collaboration between 12 federal agencies including the labor, interior, treasury and energy departments. 

In late April the working group published an initial report identifying 25 of the most impacted regions for coal-related declines, and highlighted existing federal programs that could provide nearly $38 billion in funding for relief. The report noted that ​“creating good-paying union jobs in Energy Communities is necessary but not sufficient” and stressed that ​“foundational infrastructure investments” including broadband, water systems, roads, hospitals and other institutions would be necessary to economically revitalize these areas. The group also noted that a just transition would require prioritizing pollution mitigation and environmental remediation, like plugging leaking oil and gas wells and reclaiming abandoned mine land. These objectives hold the potential not only for job creation but also achieving environmental justice priorities.

Jobs and equitable transition: Bridging the chasm between rhetoric and action

By Sean O'Leary - Ohio River Valley Institute, May 26, 2021

There was a time when the sight of rows of office workers hammering away at their Friden adding machines would have sent me into paroxysms of delight because I, the Victor Comptometer salesman, had a new and better “programmable calculator” that could kick the Friden’s ass.

I was a young 1970s college graduate entering the workforce at the tail end of the era of mechanical business automation. Typewriters, adding machines, and mechanical cash registers were still the workhorses of stores and offices.

Behind all that machinery were companies – Burroughs, Monroe, Friden, Victor – whose names were as familiar then as Cisco, Oracle, and SAP are today. And those companies supported factories, sales offices, and repair facilities that provided living wage jobs to hundreds of thousands of workers and their families.

Then, within a little more than a decade, it was all gone. A year after I fizzled as a Victor salesman, I was playing at home with my new Radio Shack TRS-80 home computer and five years later, instead of an adding machine and typewriter on my desk at work, there sat an Apple II desktop computer, precursor to the Mac.

Gone too were those hundreds of thousands of jobs plunging not only workers and families, but entire communities, into financial crisis. One could argue that Dayton, Ohio, once home to National Cash Register and the business forms giant, Standard Register, never recovered.

The knock-out blow suffered by the office automation industry was as ferocious and sudden as the one that hit the American steel industry a few years earlier, the textile industry a few decades before that, and also as the one that possibly faces workers in the fossil fuel economy today.

So how did we as a society help displaced workers and communities manage the economic consequences of the transition from the mechanical workplace to a digital one? We didn’t. Thanks to the New Deal, we had unemployment insurance and Medicare and Medicaid were brand spanking new. But that was about it – a little help for individuals and families and none whatsoever for communities.

72% of surveyed oil and gas workers in Canada want career transition, with many willing to accept wage reduction

By Elizabeth Perry - Work and Climate Change Report, April 12, 2021

A survey of over 2,000 respondents from across Canada who had previously worked in the oil and gas industry found that 72% indicated that their career priority was to make a career transition. Of that 72%, “35% indicated their desired employment situation was in a different role or industry; 14% were seeking a different work arrangement such as self-employment; and 12% planned to seek employment after additional training.” The survey results are summarized in two blogs on March 30, Untapped Talent: Opportunity to Transition, and Untapped Talent, Transitioning Opportunity , from Canada’s oil and gas labour market organization, PetroLMI. The survey was conducted from October 2019 to December 2020.

While a resistance to lower wages is frequently cited as a barrier to Just Transition, the PetroLMI survey showed that: “the wage expectations of respondents were not out of line given their education, experience and skills. When asked about their salary expectations, 61% indicated a salary of less than $100,000, and 28% were willing to take a reduction in their salary for stable employment. In Alberta more than 35% of respondents said they were willing to take a salary reduction.” 42% of respondents were over the age of 55; 77% had over 15 years of experience; 86% had post-secondary education – in Alberta, most held a university, while in the rest of Canada, trade certification was most cited.

From the industry point of view: “While layoffs rarely have a silver lining, these workforce reductions mean there is a robust pool of talent available for hire.” “The layoffs that occurred among respondents were broad and impacted a wide range of job families and occupations from trades, truck drivers, technologists and technicians to geoscientists, engineers and information technologists. The talent pool also included occupations that tended to be transferable across industries including finance, accounting, human resources, health and safety, sales, marketing and business development. They also included field operations and drilling workers with transferable skills such as working in safety-sensitive workplaces, critical thinking and problem-solving. As a result, construction and renewable energy companies have begun hiring from this talent pool.”

Canada’s Petroleum Labour Market Institute (PetroLMI- formerly the Petroleum Human Resources Council of Canada) produces ongoing labour market analysis, recently stating: “The cumulative impacts of a six-year economic downturn, lower demand due to COVID-19 health restrictions, and structural shifts in the oil and gas industry, mean there is a smaller oil and gas workforce in Canada – down 26%, or 58,700 jobs from its peak in 2014.” Their latest detailed labour market data, sourced from Statistics Canada, is here. Analytical reports are compiled here, including a four-part series titled “The Impact of COVID-19 on Canada’s Energy Workforce: A four-part series on work practices, productivity and opportunities”. On that topic, Norwegian consultancy Rystad Energy ranks Canada, U.S. and Australia as hardest hit in “Covid-19 job toll: Top O&G employer China resilient, US takes larger hit than European peers” , a March 9 newsletter. (The Canadian Energy Research Institute also published Economic Recovery Pathways for Canada’s Energy Industry: Part 2 – Canadian Crude Oil and Natural Gas in September 2020, modelling employment and economic impacts).

Fracking boom brings job and income loss to Appalachian communities

By Elizabeth Perry - Work and Climate Change Report, February 23, 2021

A February study examined the economic changes in 22 counties the authors call “Frackalachia” – home to the Utica and Marcellus shale gas industry. The report, Appalachia’s Natural Gas Counties: Contributing more to the U.S. economy and Getting less in return examines the period from 2008 to 2019, a time when the area went from producing a negligible portion of U.S. natural gas to producing 40%. The report summarizes the job forecasts provided by oil and gas industry economic impact studies, (over 450,000 new jobs for Ohio, Pennsylvania, and West Virginia), and shows the actual economic data from the U.S. Bureau of Economic Analysis – a 1.6% increase in jobs – at a time when the number of jobs across the U.S. grew by 9.9%. Detailed statistics demonstrate the differences amongst counties and states – with Ohio faring the worst and Pennsylvania faring the best. The report’s analysis shows that in the entire area represented by the 22 counties, the share of the national personal income fell by 6.3 percent, the share of jobs fell by 7.5 percent, and the share of the national population fell by 9.7 percent , while 90% of the wealth generated from fracking left the local communities.

The report was produced and published on February 10 by the Ohio River Valley Institute, a non-profit think tank based in Pennsylvania, founded in 2020 with the vision of “moving beyond an extractive economy toward shared prosperity, lasting job growth, clean energy, and civic engagement.” This report has been widely reported, including in “Appalachia’s fracking boom has done little for local economies: Study”(Environmental Health News , Feb. 12), which summarizes the report and adds context concerning the health effects of fracking, and the failed attempts to expand production to petrochemicals and plastics using ethane, a by-product of the fracked natural gas.

Appalachia's Natural Gas Counties: Contributing more to the U.S. economy and getting less in return

By Sean O'Leary - Ohio River Valley Institute, February 12, 2021

Economists debate whether there is such a thing as a “resource curse”.

Between 2008 and 2019, twenty-two old industrial and rural counties in Ohio, Pennsylvania, and West Virginia, which make up the Appalachian natural gas region, increased their contribution to US gross domestic product (GDP) by more than one-third. In 2008, the 22 counties were responsible for $2.46 of every $1,000 of national output. By 2019, the figure had climbed to $3.33. Their rate of GDP growth more than tripled that of the nation. However, during the same period, measures of local economic prosperity—the economic impacts of that growth—not only failed to keep pace with the increased share of output, they actually declined.

  • The 22 counties’ share of the nation’s personal income fell by 6.3%, from $2.62 for every $1,000 to just $2.46.
  • Their share of jobs fell by 7.6%, from 2.62 in every 1,000 to 2.46.
  • Their share of the nation’s population fell by 10.9%, from 3.26 for every 1,000 Americans to 2.9 for every thousand.

It is a case of economic growth without prosperity, the defining characteristic of the resource curse.

Most of the GDP increase in this group of counties was due to the Appalachian natural gas production boom, which was facilitated by the advent of a drilling technique called hydraulic fracturing, or “fracking” for short.

Read the text (PDF).

Appalachian Fracking Boom Was a Jobs Bust, Finds New Report

By Nick Cunningham - DeSmog, February 11, 2021

The decade-long fracking boom in Appalachia has not led to significant job growth, and despite the region’s extraordinary levels of natural gas production, the industry’s promise of prosperity has “turned into almost nothing,” according to a new report. 

The fracking boom has received broad support from politicians across the aisle in Appalachia due to dreams of enormous job creation, but a report released on February 10 from Pennsylvania-based economic and sustainability think tank, the Ohio River Valley Institute (ORVI), sheds new light on the reality of this hype.

The report looked at how 22 counties across West Virginia, Pennsylvania, and Ohio — accounting for 90 percent of the region’s natural gas production — fared during the fracking boom. It found that counties that saw the most drilling ended up with weaker job growth and declining populations compared to other parts of Appalachia and the nation as a whole.

Shale gas production from Appalachia exploded from minimal levels a little over a decade ago, to more than 32 billion cubic feet per day (Bcf/d) in 2019, or roughly 40 percent of the nation’s total output. During this time, between 2008 and 2019, GDP across these 22 counties grew three times faster than that of the nation as a whole. However, based on a variety of metrics for actual economic prosperity — such as job growth, population growth, and the region’s share of national income — the region fell further behind than the rest of the country. 

Between 2008 and 2019, the number of jobs across the U.S. expanded by 10 percent, according to the ORVI report, but in Ohio, Pennsylvania, and West Virginia, job growth only grew by 4 percent. More glaringly, the 22 gas-producing counties in those three states — ground-zero for the drilling boom — only experienced 1.7 percent job growth.

“What’s really disturbing is that these disappointing results came about at a time when the region’s natural gas industry was operating at full capacity. So it’s hard to imagine a scenario in which the results would be better,” said Sean O’Leary, the report’s author.

The report cited Belmont County, Ohio, as a particularly shocking case. Belmont County has received more than a third of all natural gas investment in the state, and accounts for more than a third of the state’s gas production. The industry also accounts for about 60 percent of the county’s economy. Because of the boom, the county’s GDP grew five times faster than the national rate. And yet, the county saw a 7 percent decline in jobs and a 2 percent decline in population over the past decade.

“This report documents that many Marcellus and Utica region fracking gas counties typically have lost both population and jobs from 2008 to 2019,” said John Hanger, former Pennsylvania secretary of Environmental Protection, commenting on the report. “This report explodes in a fireball of numbers the claims that the gas industry would bring prosperity to Pennsylvania, Ohio, or West Virginia. These are stubborn facts that indicate gas drilling has done the opposite in most of the top drilling counties.”

A Boom Without Job Growth

This lack of job growth was not what the industry promised. A 2010 study from the American Petroleum Institute predicted that Pennsylvania would see more than 211,000 jobs created by 2020 due to the fracking boom, while West Virginia would see an additional 43,000 jobs. Studies like these were widely cited by politicians as proof that the fracking boom was an economic imperative and must be supported.

But the Ohio River Valley Institute report reveals the disconnect between a drilling boom and rising GDP on the one hand, and worse local employment outcomes on the other. There are likely many reasons for this disconnect related to the long list of negative externalities associated with fracking: The boom-and-bust nature of extractive industries creates risks for other business sectors, such as extreme economic volatility, deterring new businesses or expansions of existing ones; meanwhile air, water, and noise pollution negatively impact the health and environment of residents living nearby.

“There can be no mistake that the closer people live to shale gas development, the higher their risk for poor health outcomes,” Alison Steele, Executive Director of the Southwest Pennsylvania Environmental Health Project, told DeSmog. “More than two dozen peer-reviewed epidemiological studies show a correlation between living near shale gas development and a host of health issues, such as worsening asthmas, heart failure hospitalizations, premature births, and babies born with low birth weights and birth defects.”

Moreover, oil and gas drilling is capital-intensive, not job-intensive. As the example of Belmont County shows, only about 12 percent of income generated by the gas industry can be attributable to wages and employment, while in other sectors, on average, more than half of income goes to workers.

In other words, it costs a lot of money to drill, but it doesn’t employ a lot of people, and much of the income is siphoned off to shareholders. To top it off, equipment and people are imported from outside the region — many of the jobs created went to workers brought in from places such as Texas and Oklahoma.

Despite the huge increase in shale gas production over the past decade, the vast majority of the 22 counties experiencing the drilling boom also experienced “economic stagnation or outright decline and depopulation,” the report said.

The American Petroleum Institute did not respond to a request for comment.

“[W]e could see long ago that the job numbers published and pushed out by the industry years ago were based in bluster, not our economic realities,” Veronica Coptis, Executive Director of Coalfield Justice, a non-profit based in southwest Pennsylvania, told DeSmog, commenting on the report. “At industry’s behest and encouragement, Pennsylvania promoted shale gas development aggressively in rural areas for more than a decade. And yet, the southwestern counties at the epicenter of fracking do not show any obvious improvement in well-being.”

Pages

The Fine Print I:

Disclaimer: The views expressed on this site are not the official position of the IWW (or even the IWW’s EUC) unless otherwise indicated and do not necessarily represent the views of anyone but the author’s, nor should it be assumed that any of these authors automatically support the IWW or endorse any of its positions.

Further: the inclusion of a link on our site (other than the link to the main IWW site) does not imply endorsement by or an alliance with the IWW. These sites have been chosen by our members due to their perceived relevance to the IWW EUC and are included here for informational purposes only. If you have any suggestions or comments on any of the links included (or not included) above, please contact us.

The Fine Print II:

Fair Use Notice: The material on this site is provided for educational and informational purposes. It may contain copyrighted material the use of which has not always been specifically authorized by the copyright owner. It is being made available in an effort to advance the understanding of scientific, environmental, economic, social justice and human rights issues etc.

It is believed that this constitutes a 'fair use' of any such copyrighted material as provided for in section 107 of the US Copyright Law. In accordance with Title 17 U.S.C. Section 107, the material on this site is distributed without profit to those who have an interest in using the included information for research and educational purposes. If you wish to use copyrighted material from this site for purposes of your own that go beyond 'fair use', you must obtain permission from the copyright owner. The information on this site does not constitute legal or technical advice.