Naomi Klein, photograph by Joe Mabel, distributed via Wikimedia Commons

A renewable energy economy will create more jobs. Is that a good thing?

Also published at Resilience.org.

In a tidal wave of good news stories, infographics and Facebook memes about renewable energy job creation, the implicit, unquestioned assumption is that More Jobs = A Healthier Economy.

A popular Facebook meme, based on the Stanford University Solutions Project, celebrates the claim that in a renewable energy-powered Canada, 40% more people will work in the energy sector.

From the Environment Hamilton Facebook page.

From the Environment Hamilton Facebook page.

 

In elaborate info-graphics, the Solutions Project provides comparable claims for all 50 US states and countries around the world – although “assertion-graphic” might be a better term, since the graphics are presented with no footnotes and no clear links to any data that might allow a skeptical mind to evaluate the conclusions.

From The Solutions Project website.

From The Solutions Project website.

And Naomi Klein, author of This Changes Everything and one of the proponents of The Leap Manifesto, cites the Energy Transition in Germany and notes that 400,000 new jobs have already been created. In her hour-long talk on the CBC Radio Ideas program and podcast, Klein gets at some of the key issues that will determine whether More Energy Jobs = A Good Thing, and we’ll return to this podcast later.

To start, though, let’s look at the issue through the following proposition:

The 20th century fossil-fueled economic growth spurt happened not because the energy industry created many jobs, but because it created very few jobs.

For most of human history, providing energy in the form of food calories was the major human occupation. Even in societies that consumed relatively high amounts of energy via firewood, harvesting and transporting that wood kept a lot of people busy.

But during the 19th and 20th centuries, as the available per capita energy supply in industrialized countries exploded, the proportion of the population employed supplying that energy dropped dramatically.

The result: instead of farming to provide the carbohydrates that feed humans and oxen, or cutting firewood to heat buildings, nearly the whole population has been free to do other activities. Whether we have made good use of this opportunity is debatable, but we’ve had plenty of energy, and nearly our entire labour force, available to run an elaborate manufacturing, consumption and service economy.

Seen from this perspective, the claim that renewable energy will create more jobs might set off alarms.

What’s in a job?

Part of the difficulty is that when we speak of a job, we refer to two (or more) very different things.

A job might mean simply something that has to be done. In this sense of the word, we don’t usually celebrate jobs. If we need to carry all our water in buckets from a well five kilometers from home, there are a lot of jobs in water-carrying – but we would probably welcome having taps right in our kitchens instead. Agriculture employs a lot of people if the only tools are sticks, but with better tools the same amount of food can be raised with fewer people working the fields.

So when we think of a job as the need to do something, we typically think that the fewer jobs the better.

When we celebrate job-creation, on the other hand, we typically mean something quite different –  a “job” is an activity that is accompanied by a pay-cheque. Since in our society most of us need to get pay-cheques for most of our lives, job-creation strikes us as a good thing to the extent that pay-cheques are involved.

Here’s the wrinkle with renewable energy job creation: the renewable energy transition will likely create jobs in the sense of adding to the quantity of work that must be done (which we normally try to minimize) and jobs in the sense of providing pay-cheques (which we typically want to maximize). The two types of job-creation are at cross-purposes, and the outcome is uncertain.

Allocation of energy surplus

Widespread prosperity depends not only on what work is done and what surplus is produced, but on how that surplus is allocated and distributed.

In the middle of the 20th century in North America and Europe, only a few people worked in energy supply but they produced a huge surplus. At the same time, the products of surplus energy were distributed in relatively equal fashion, compared to the rising levels of inequality today. The mass consumption economy – a brief anomaly in human history which is ironically referred to as Business As Usual – depended on both conditions being met. There had to be a large surplus of energy produced (or, more accurately, extracted) by a few people, and this surplus energy had to be widely distributed so that most people could participate in a consumer economy.

Naomi Klein gives prominent emphasis to the second of these two conditions. In her CBC Radio Ideas talk, she says

There’s a group in the US called Movement Generation which has a slogan that I quote a lot, which is that “transition is invevitable, but justice is not.” You can respond to climate change in a way that people putting up solar panels are paid terrible wages. In the US prison inmates are making some of the solar panels that they’re putting up. … There has to be a road map for responding to climate change in an intersectional way, which solves multiple problems at once.”

She cites the German Energy Transition as an encouraging example:

There are 900 new energy co-operatives that have sprung up in Germany. Two hundred towns and cities in Germany have taken their energy grids back from the private companies that took them over in the 1990s, and they call it “energy democracy”. They’re taking back control over their energy, so that the resources stay in the communities and they can use the profits generated from renewable energy to pay for services. They’ve also created 400,000 jobs as part of this transition. So they’re showing how you solve multiple problems at once. Lower emissions create good unionized jobs and generate the revenue we need to fight the logic of austerity at the local level.”

In Klein’s formulation, democratic control of the energy economy is a key to prosperity. Because of this energy democracy, the new jobs are “good unionized jobs” which “fight the logic of austerity”. But is that sustainable in the long run?

As Klein says, in Germany’s “energy democracy” they use “the profits generated from renewable energy to pay for services”. But that presupposes that the renewable energy technologies being used do indeed generate “profits”.

It remains an open question how much profit – how much surplus energy – will be generated from renewable energy development. If renewable energy developments consume nearly as much energy as they produce, then in the long run the energy sector may produce many pay-cheques but they won’t be generous pay-cheques, however egalitarian society might be.

Book cover, Life After Growth by Tim MorganEnergy sprawl

Tim Morgan uses the apt phrase “energy sprawl” to describe what happens as we switch to energy technologies with a lower Energy Return on Energy Invested (EROEI).

‘energy sprawl’ … has both physical and economic meanings. In physical terms, the infrastructure required to access energy and deliver it to where it is needed is going to expand exponentially. At the same time, the proportion of GDP absorbed by the energy infrastructure is going to increase as well, which means that the rest of the economy will shrink.” (Life After Growth, Harriman House, 2013, locus 2224)

As Morgan makes clear, energy sprawl is not at all unique to renewable energy transition – it applies equally to non-conventional, bottom-of-the-barrel fossil fuels such as fracked oil and gas, and bitumen extracted from Alberta’s tar sands. There will indeed be more jobs in a renewable resource economy, compared to the glory days of the fossil fuel economy, but there will also be more energy jobs if we cling to fossil fuels.

As energy sprawl proceeds, more of us will work in energy production and distribution, and fewer of us will be free to work at other pursuits. As Klein and the other authors of the Leap Manifesto argue, the higher number of energy jobs might be a net plus for society, if we use energy more wisely AND we allocate surplus more equitably.

But unless our energy technologies provide a good Energy Return On Energy Invested, there will be little surplus to distribute. In other words, there will be lots of new jobs, but few good pay-cheques.

Top photo: Canadian author and activist Naomi Klein, photographed by Joe Mabel in October 2015, accessed via Wikimedia Commons

Newspapers, running on empty

Also published at Resilience.org.

There isn’t much news in most community newspapers these days. While it’s common to blame the internet for the woes of newspapers, the crisis in the news business is also a symptom of the faltering growth of our fossil-fueled economy.

Our local newspaper carried a headline this week that caught my eye: “Metroland papers in Durham well read”. The self-congratulatory article shared a number of factoids from a Metroland-commissioned survey. For example: “readership topped 82 per cent” (with “readership” defined generously as meaning a person had “read” at least one of the past four issues of the newspaper and/or its flyers). Or this: the typical issue “is kept in the house for an average of almost four days” (which makes perfect sense, since recycling day varies through the region, but on each street the recycling truck comes once a week).

Metroland is a subsidiary of the Toronto Star (the largest newspaper in Canada by circulation). Metroland is responsible for more than 100 small-market papers in Ontario, including Clarington This Week in my town.

Since moving to Clarington a year ago I’ve read every issue of Clarington This Week, looking especially for news of local politics, economic development and planning. Alas, this is not one of the paper’s strong suits, and I studied the news for months before learning the secret of when the municipal council holds its meetings.

For that, I do not blame local journalists. They work in chronically understaffed newsrooms, and if they wrote up each significant development in municipal politics, management would be hard-pressed to free up any space to print the stories.

Let’s be frank: in community newspapers actual journalism is an essential but minor component of the much larger business of distributing ads, especially ads in the form of flyers.

The most recent issue of our local paper, for example is 48 pages. Measuring the amount of news coverage (defined as all photos, articles, and headlines which are not paid advertising) I found that the newspaper itself is just under 30% news, and just over 70% ads. That makes 14.3 pages of news.

But the flyers total 180 pages (and this at a slow time of year for retail; in the month before Christmas the bundle is far thicker). The newspaper and ads together are 228 pages, so the 14.3 pages of news take up just 6% of the total package.

“Free” media and the shrinking news hole

The most recent edition of Clarington This Week is hard to find among all its flyers.

The most recent edition of Clarington This Week is hard to find among all its flyers.

How did the news get buried in an avalanche of ads? The shift to 100% advertising-supported business models marked an inflection point in a process that’s been going on for decades.

Full disclosure: in my own small way I was an accomplice in this process. As a managing editor at the end of the 1990’s, I helped shift a subscription-supported small-town newspaper to 100% advertiser-funded, “free” distribution. For this misdeed I expect I will be reincarnated at least once as some lowly scavenger – perhaps a carp, or a dung beetle, or a homo economicus.

There was a clear business case for free distribution. For many years, the proportion of newspaper revenues from subscription fees had been decreasing while the proportion of revenue from ads had increased. By the 1990s, subscription newspapers typically received only about 20% of their income from subscriptions – basically, subscriptions just covered the cost of delivery, while ad revenue covered all the rent, the printing costs, and the staff salaries.

Most advertisers were happier to pay for ads that reached all local residents, not just subscribers. For small-community newspapers, in particular, the shift to free distribution meant more ad revenue, which could easily replace the diminishing income that previously came from subscription fees.

There was one underlying condition: if advertisers funded ever-greater proportions of the cost of newspapers, they had to sell ever more stuff to make their ad expenditures worthwhile. Through the lifetimes of everyone working in the newspaper industry today, this trend was reliable enough that we didn’t have to think about it, until recently.

Almost continuous economic growth for several generations has lead many people to regard continuous economic growth as the natural order of things. But a minority among economists points out that continuous, exponential growth is not the natural order, but instead is a natural impossibility. They further note the past century of rapid economic growth coincides neatly with the rapid exploitation of most of the world’s easily accessible fossil fuels. In this view, the explosive growth in consumer spending for the past century is in large part an artifact of what James Howard Kunstler calls the “fossil fuel fiesta”.

From "Shifts in Newspaper Advertising Expenditures and their Implications for the Future of Newspapers", by Robert G. Picard, July 2008, accessed from academia.edu (click graphic for link to article)

From “Shifts in Newspaper Advertising Expenditures and their Implications for the Future of Newspapers”, by Robert G. Picard, July 2008, accessed from academia.edu (click graphic for link to article)

For the past 60 years, newspaper ad expenditure growth tracked pretty closely with Gross Domestic Product (GDP) growth. And as long as consumers bought more of the stuff that businesses advertised, these businesses could spend more on ads, and newspapers could reduce or even eliminate subscription fees and thereby boost circulation. Gradually, consumers began to think of news and information as “free”.

When internet information providers started to grow in the late 1990s, most adopted this “free” distribution model. That in turn made this model less successful for newspapers. Total ad expenditures continued to rise, but they had to be shared among more media. Ads got much cheaper, and newspapers found it increasingly difficult to price ads high enough to finance journalists’ (diminishing) salaries. When the effects of the Great Recession of 2008 combined with competition from the internet, the crisis for newspapers intensified. The “news hole” – the space left over for news after the paid ads were slotted in – continued to shrink, as newspapers filled up with lower-priced ads which barely covered production costs.

A blizzard of flyers

Back to our local story. At the turn of the millennium when I managed a small-town newspaper, a news hole of 50% or more of the newspaper was still common. And although flyer distribution was becoming a significant sideline for many newspapers, the volume of flyers was still small compared to the size of the newspapers.

In the paper I worked for, we prided ourselves on keeping the news hole above 50%, and bundling only a couple of flyers with each issue. We felt we were still primarily in the news business, instead of primarily in the ad distribution business.

How quaint that seems now. Over the past 15 years, retailers have been increasingly reliant on volume sales of low-profit-margin junk. A half-page ad inside a newspaper doesn’t suffice – each supermarket or big-box retailer wants multiple pages of their ads landing in consumers’ homes each and every week. (Those 75 different flavours of potato chips don’t sell themselves.)

So they’ve demanded ever-cheaper flyer distribution, and newspapers have been in no position to turn them down.

We reached the point where people referred to a local newspaper as just a wrapper for flyers – but we’re far beyond that now. With many community newspapers the pack of flyers is far too thick to fit inside the paper.

The result: newspapers like the one I received last Thursday, with 6% news, 94% ads.

Is the end nigh?

As unsatisfactory as the current media business is to an avid reader, it is also unsustainable. Whether the news provider is Google or Facebook or the local newspaper, providing “free” information only works as long as readers and viewers keep buying more of the stuff that is being advertised.

When the long trend of economic growth stalls, advertisers will no longer be able to fund media. I’m among those who think this change is already well underway.

The economic turmoil of the past eight years will upend many business models that used to sound prudent, back when abundant and easily-accessible fossil fuels helped us to produce and consume more stuff every year.

Top photo: a single issue of a local newspaper underneath all its ad flyers, on the backdrop of the parking lot of the vacant Target store in Bowmanville, Ontario.

Freight expectations

Also published at Resilience.org.

Alice J. Friedemann’s new book When Trucks Stop Running explains concisely how dependent American cities are on truck transport, and makes a convincing case that renewable energies cannot and will not power our transportation system in anything like its current configuration.

But will some trucks stop running, or all of them? Will the change happen suddenly over 10 years, or gradually over 40 years or more? Those are more difficult questions, and they highlight the limitations of guesstimating future supply trends while taking future demand as basically given.

When Trucks Stop Running, Springer, 2016

When Trucks Stop Running, Springer, 2016

Alice J. Friedemann worked for more than 20 years in transportation logistics. She brings her skills in systems analysis to her book When Trucks Stop Running: Energy and the Future of Transportation (Springer Briefs in Energy, 2016).

In a quick historical overview, Friedemann explains that in 2012, a severely shrunken rail network still handled 45% of the ton-miles of US freight, while burning only 2% of transportation fuel. But the post-war highway-building boom had made it convenient for towns and suburbs to grow where there are neither rails nor ports, with the result that “four out of five communities depend entirely on trucks for all of their goods.”

After a brief summary of peak oil forecasts, Friedemann looks at the prospects for running trains and trucks on something other than diesel fuel, and the prospects are not encouraging. Electrification, whether using batteries or overhead wires, is ill-suited to the power requirements of trains and trucks with heavy loads over long distances. Friedemann also analyzes liquid fuel options including biofuels and coal-to-liquid conversions, but all of these options have poor Energy Return On Investment ratios.

While we search for ways to retool the economy and transportation systems, we would be wise to prioritize the use of precious fuels. Friedemann notes that while trains are much more energy-efficient than heavy-duty trucks, trucks in turn are far more efficient than cars and planes.

So “instead of electrifying rail, which uses only 2% of all U.S. transportation fuel, we should discourage light-duty cars and light trucks, which guzzle 63% of all transportation fuel and give the fuel saved to diesel-electric locomotives.” Prioritizing fuel use this way could buy us some much-needed time – time to change infrastructure that took decades or generations to build.

If it strains credulity to imagine US policy-makers facing these kinds of choices of their own free will, it is nevertheless true that the unsustainable will not be sustained. Hard choices will be made, whether we want to make them or not.

A question of timing

Friedemann’s book joins other recent titles which put the damper on rosy predictions of a smooth transition to renewable energy economies. She covers some of the same ground as David MacKay’s Sustainable Energy – Without The Hot Air or Vaclav Smil’s Power Density, but in more concise and readable fashion, focused specifically on the energy needs of transportation.

In all three of these books, there is an understandable tendency to answer the (relatively) simple question: can future supply keep up with demand, assuming that demand is in line with today’s trends?

But of course, supply will influence demand, and vice versa. The interplay will be complex, and may confound apparently straight-forward predictions.

It’s important to keep in mind that in economic terms, demand does not equal what we want or even what we need. We can, and probably will, jump up and down and stamp our feet and DEMAND that we have abundant cheap fuel, but that will mean nothing in the marketplace. The economic demand equals the amount of fuel that we are willing and able to buy at a given price. As the price changes, so will demand – which will in turn affect the supply, at least in the short term.

Consider the Gross and Net Hubbert Curves graph which Friedemann reproduces.

Gross and Net Hubbert Curve, from When Trucks Stop Running, page 124

From When Trucks Stop Running, page 124

While the basic trend lines make obvious sense, the steepness of the projected decline depends in part on a steady demand: the ultimately recoverable resource is finite, and if we continue to extract the oil as fast as possible (the trend through our lifetimes) then the post-peak decline will indeed be steep, perhaps cliff-life.

But can we and will we sustain demand if prices spike again? That seems unlikely, particularly given our experience over the past 15 years. And if effective demand drops dramatically due to much higher pricing, then the short-term supply-on-the-market should also drop, while long-term available supply-in-the-ground will be prolonged. The right side of that Hubbert curve might eventually end up at the same place, but at a slower pace.

The most wasteful uses of fuels might soon be out of our price range, so we simply won’t be able to waste fuel at the same breathtaking rate. The economy might shudder and shrink, but we might find ways to pay for the much smaller quantities of fuel required to transport essential goods.

In other words, there may soon be far fewer trucks on the road, but they might run long enough to give us time to develop infrastructure appropriate to a low-energy economy.

Top photo: fracking supply trucks crossing the Missouri River in the Fort Berthold Indian Reservation in North Dakota, June 2014.

Does your city have a future?

In the past, as in the future, local ecosystem resources were the key to the economies of cities. A review of America’s Most Sustainable Cities & Regions.

Also published at Resilience.org.

America’s Most Sustainable Cities and Regions, by John W. Day and Charles Hall, published by Springer, 2016

America’s Most Sustainable Cities and Regions, by John W. Day and Charles Hall, published by Springer, 2016

Readers hoping to find their home town rated in America’s Most Sustainable Cities and Regions may be both disappointed and enlightened.

Disappointed, because the book doesn’t provide a systematic listing that covers all American cities – either the most sustainable or the least sustainable. Enlightened, because the authors do provide a systematic way of looking at sustainability, which can be applied to cities across the USA and around the world.

The authors are counted among the pioneers of ecological economics, and their new book is a lucid introduction to the fundamental concepts of this viewpoint.

While a textbook of ecological economics might lose some readers in abstraction, this book moves fluidly between abstract concepts, and easy-to-follow application of these principles to the past development, and possible futures, of twelve cities and ten regions.

In the process, Day and Hall show that cities which grew up before the heyday of the fossil fuel age were sited to benefit from strong ecosystem services:

until the beginning of the twentieth century, cities like New York, Albany, Chicago, and New Orleans grew up in resource-rich areas and along waterways that provided food and fiber and convenient trade routes. Second, the climate of all of these early cities was moist …. (America’s Most Sustainable Cities and Regions, page 16)

The combination of adequate rainfall, benign climate and fertile soils leads to high potential for agriculture, as shown in a map of Net Primary Productivity:

The growth rate of plants (expressed as NPP or net primary productivity in grams per meter square per year) across the central part of North America. The tan areas have very low productivity, and dark green areas are highly productive. From America’s Most Sustainable Cities and Regions, Springer, 2016, page 132

The growth rate of plants (expressed as NPP or net primary productivity in grams per meter square per year) across the central part of North America. The tan areas have very low productivity, and dark green areas are highly productive. From America’s Most Sustainable Cities and Regions, Springer, 2016, page 132

By contrast, some major cities in the arid west enjoyed minimal ecosystem resources to begin with, and they had scarcely outgrown village status before requiring vast resource inputs that could only realistically be supplied by fossil fuels.

Las Vegas, for example, was located at a small oasis fed by artesian wells amidst vast deserts. And the Los Angeles River initially supplied enough water for a small town, but as groundwater was withdrawn the River ceased to flow year round, and dried up in the 1920s. Thus both Las Vegas and Los Angeles had to wait for the high-energy economy of the fossil fuel age, which built dams and pumped water from hundreds of miles away, before they could grow into large cities.

Not surprisingly, Las Vegas and Los Angeles, along with other sunbelt cities in arid regions, get dismal ratings for sustainability in a future when cheap fossil fuels run short, and climate change exacerbates droughts.

At the other end of the spectrum, Cedar Rapids, Iowa, is located in a still-fertile plain with adequate rainfall for farming. Freight transportation is close at hand via the Mississippi River system, and relatively clear skies and dependable breezes can provide solar and wind generation of electricity (though the authors make clear that these energy sources are unlikely to provide anything like the quantities of energy we now routinely use). Perhaps most critically, Cedar Rapids is a small city, whose population can conceivably be supported by nearby resources in a low-energy future.

New Orleans was founded in an area with some of the continent’s richest ecosystem resources. But residents may not have the option to rely on these resources in future:

The ecosystem that has supported the unique, vibrant culture of the city is rapidly eroding into the sea as the impacts of sea level rise, levees, and oil industry canals exacerbate the natural land loss rates of the subsiding deltaic wetland environment that surrounds the city. (America’s Most Sustainable Cities and Regions, page 64)

Unless there is a major and effective restoration program, New Orleans’ future prospects are not good. Undoing the damage wrought by fossil-fueled projects will be difficult in a lower-energy economy – and doubly difficult as climate change brings stronger hurricanes, higher sea levels and storm surges, and more extreme fluctuations in the flow of the Mississippi.

Other cities are in very hard times currently, but the regional ecosystem services are still relatively strong, leading to more hopeful future prospects:

There are active plans in both Flint and Detroit to develop urban agriculture on vacant land. “Urban farms” from a few acres to several hundred acres have sprung up in both cities with vegetables, fruit trees, chickens and eggs. … Thus, in the face of pervasive urban decay and collapse, these cities may be able to produce a significant amount of food. (America’s Most Sustainable Cities and Regions, page 49)

While the book is a strong addition to the literature on sustainability, I do have a few quibbles. First, a reader expecting discussion of the sustainability of average citizens’ lifestyles in various cities will be disappointed. It gradually becomes clear that current per capita ecological footprints are not the subject of this book, nor are Hall and Day ranking the degree to which the economies of various American cities are sustainable in their current configurations. Rather, they elucidate the degree to which these cities will be sustainable as they cope with 21st century megatrends. A clear statement early in the book, explaining what the authors mean and what they don’t mean by “America’s most sustainable cities”, would have been helpful.

Finally, the book’s predictive usefulness is weakened by a lack of any mention of either large-scale migrations or political factors on future sustainability.

The authors note that the resources in the area around Cedar Rapids could likely support the current population (though not their current lifestyles). On the other hand, the population of the megalopolis from Washington DC to Boston, including New York City, is far too great to be supported by local resources. In theory, then, the current Cedar Rapids could become sustainable, while the current New York City cannot.

Eventually that which cannot be sustained, will not be sustained. However, suppose a severe resource crunch hits rapidly. Assuming the millions of people in New York City don’t just ascend in The Rapture, many will move to someplace that can provide the necessities of life. A large outflow of people from cities like New York, and an inflow into the smaller, theoretically sustainable cities like Cedar Rapids, would quickly alter the sustainability calculus.

Likewise, if sustainability is threatened for large numbers of people on a short time-line, political leaders could force through desperately short-sighted measures to feed populations. Thus regions which currently have relatively strong ecosystems may not be able to maintain those environments, as more populous and more powerful regions exert their demands.

In summary, John W. Day and Charles Hall have provided a great overview of the factors that can make a city and a region sustainable, even in the face of restricted energy shortages and the challenges of climate change. If we move quickly enough in adopting an “economics as if reality matters”, then this book may also serve as a road map to a reasonably prosperous future.