Impact of Renewable Energy on Employment
Introduction
Energy is a leading resource in business cycles, making it a vital resource for value creation and fulfilling needs. The rapid development of most economies has created an increase in the demand for energy, thus promoting renewable energy as an alternative source of energy to meet rising energy needs. Renewable energy refers to sustainable energy acquired from a source that cannot be depleted, such as wind and sunshine. The need to create sustainable communities has increased the popularity of renewable energy and research on various concepts connected to its application. The use and production of renewable energy promote the development of new technologies and create new opportunities for entrepreneurs, thus contributing to economic growth. The energy sector, therefore, plays two significant roles in society: producing energy and supporting other parts of the economy by participating in economic processes. A developed and efficient energy sector with a stable and secure energy supply and reasonable energy resources prices promotes the development of the economy and assists in realizing other economic impacts, such as enhancing the competitiveness of the economy. Various researchers have focused on the economic impact of renewable energy by reviewing how it affects employment based on the fact that employment is considered to be one of the primary macroeconomic indicators characterizing economic efficiency. This research focuses on determining how renewable energy affects employment both positively and negatively based on secondary data retrieved from case studies and peer-reviewed journal articles.
Impact of Renewable Energy on Employment
Existing literature on how renewable energy affects employment has focused on both negative and positive impacts. According to Haerer and Pratson (2015), solar, wind, and natural gas energy sectors in the United States positively impact employment. The authors argue that these industries have created more than 200,000 jobs in the United States, while the coal industry has faced a loss of more than 40,000 jobs. The authors argue that the differences in the effect of renewable energy in the industries are a result of varying applications of renewable energy and the personnel needed to complete operations in the industries. This argument is supported by the findings of a survey conducted by Garrett-Peltier (2017), showing that renewable and energy efficiency sectors generate around triple the number of jobs in comparison to the fossil fuel sectors at similar spending levels. The research found that every 1 million dollars invested in fossil fuels generated approximately more than 25 thousand full-time jobs, while the same amount of spending on renewable energy would create more than 7 thousand full-time jobs.
The role of renewable energy in creating jobs is also explored by DOE (2017) in a study reviewing the impact of solar energy on job creation. The study concludes that the solar energy sector in the United States has created employment for more people compared to coal. This conclusion is based on findings indicating that the solar energy sector in the United States employed roughly 350,000 people, contributing to 43% of the workforce in the generation of electric power, while the fossil fuels industry offered employment for around 187,000 people, contributing to only 22% of the workers. Bulavskaya and Reynès (2018) conducted a study that established that the Netherlands ’ transition to renewable energy would create roughly more than 45,000 new jobs by 2030 and contribute to around 1% of the GDP. The researchers attribute this difference to the higher capital and labor concentration of solar and wind technologies compared to gas and coal. The authors also argue that generating power through renewable energy is more critical to a country’s economy compared to using fossil fuels because solar and wind power is more labor and capital-intensive compared to fossil power but less energy-intensive
Markandya, Arto, González-Eguino, and Román (2016) argue that there was a rise in employment between 1995 and 2009, resulting in an average of more than 500,000 new jobs because of transitioning from carbon-intensive energy sources to renewable energy and gas. Another study conducted by Mu et al. (2018) in China showed that expanding the use of wind and solar power would create more than 40 thousand and 15 thousand jobs respectively. The influence of renewable energy on employment is also explored by researchers arguing that the policy of using green energy can have a negative and positive impact on employment because it would create additional jobs in the new renewable energy industries and eliminate employment that is induced by investment in other sectors(Pestel,2014). According to Böhringer, Keller, and van der Werf (2013), the negative influence arises when grants provided to generate electricity using renewable energy sources are funded by labor taxes. The authors add that estimating how renewable energy affects employment requires considering net and gross employment.
IRENA (2011) defines gross employment as the collection of positive influences of employment ensuing from investing in renewable energy and does not consider any employment loss in other segments, while net employment considers both negative and positive influences. The government ought to develop policies that encourage the creation of employment related to renewable energy, focusing on deploying and developing renewable energy, considering the related opportunity costs, and balancing them against anticipated benefits(IRENA,2011). This recommendation is supported by Böhringer, Keller, and van der Werf (2013). The authors state that subsidized production of electricity from renewable energy sources has little impact on welfare and employment in Germany. The researchers established that subsidies used to fund renewable energy have a negative influence on employment and welfare.
The negative impact of renewable energy on employment is also explored by Cebotari, Cristea, Moldovan, and Zubascu (2017) by comparing revenues and employment in villages using renewable energy projects and those without the projects. The study found that renewable energy projects had no impact on revenue and employment. Cai, Wang, Chen, and Wang (2011) drew similar findings by considering a five-year period of using renewable energy, claiming that there is no certainty that renewable energy sources create more employment than other energy sources. During the study, which was conducted in China, the researchers observed that during the first three years of transitioning from natural gas and fossil fuel to renewable energy, the project did not generate as many jobs as those lost by reducing the use of fossil fuels and coal mines particularly for countries such as China. The results indicated that from 2006 to 2009, mitigating traditional power strategies resulted in a loss of more than 40,000 jobs. The results also showed that more than 400,000 indirect jobs were created as a result of using renewable energy. The authors argued that for every 1% of photovoltaic augmentation installed in China, there was a 0.7% increase in job creation, hence making photovoltaic the best alternative for producing power.
Rivers (2013) found that renewable energy has a negative influence on employment. The authors used an analytical equilibrium model to determine the relationship between the unemployment rate and renewable energy sources. They established that adopting renewable energy policies by subsidies and taxation on the consumption of fuel has a negative impact on employment. The authors also argue that there is a limited possibility of substituting labor and capital when global capital funds cannot be accessed, and when there is a high solution for the implementation of renewable energy, promoting renewable energy sources could reduce unemployment rates. Rivers (2013) also argued that the only thing that alters the creation of jobs after adopting renewable energy is the nature of the jobs created because renewable energy has a limited impact on unemployment. The author also argues that the impact varies from one society to another based on the socio-economic conditions of every country. This is mainly because mobilization to transition to the use of renewable energy is easier in countries where citizens understand the cost of investing in renewable energy because conditions favor the use of renewable energy, such as access to bank loans with little interest and no or low taxation and where competition between the companies using renewable energy makes the investment in renewable energy attractive. For developing countries where the cost of adopting renewable energy is high for citizens, the government must set rules on the procedures that should be performed because global capital may not be available and governmental policies favor global companies and large-scale renewable energy products.
References
Böhringer, C., Keller, A. and van der Werf, E., 2013. Are green hopes too rosy? Employment and welfare impacts of renewable energy promotion. Energy Economics, 36, pp.277-285.
Bulavskaya, T. and Reynès, F., 2018. Job creation and economic impact of renewable energy in the Netherlands. Renewable Energy, 119, pp.528-538.
Cai, W., Wang, C., Chen, J. and Wang, S., 2011. Green economy and green jobs: Myth or reality? The case of China’s power generation sector. Energy, 36(10), pp.5994-6003.
Cebotari, S., Cristea, M., Moldovan, C. and Zubascu, F., 2017. Renewable energy’s impact on rural development in northwestern Romania. Energy for Sustainable Development, 37, pp.110-123.
DOE, 2017. U.S energy and employment report.
Garrett-Peltier, H., 2017. Green versus brown: Comparing the employment impacts of energy efficiency, renewable energy, and fossil fuels using an input-output model. Economic Modelling, 61, pp.439-447.
Haerer, D. and Pratson, L., 2015. Employment Trends in the U.S. Electricity Sector, 2008–2012. Energy Policy, 82, pp.85-98.
IRENA, 2013. Practical Policies for Financing Renewable Energy Action Plan Investments Renewable Power Investments Required in South East Europe.
Markandya, A., Arto, I., González-Eguino, M. and Román, M., 2016. Towards a green energy economy? Tracking the employment effects of low-carbon technologies in the European Union. Applied Energy, 179, pp.1342-1350.
Mu, Y., Cai, W., Evans, S., Wang, C., and Roland-Holst, D., 2018. Employment impacts of renewable energy policies in China: A decomposition analysis based on a CGE modeling framework. Applied Energy, 210, pp.256-267.
Pestel, N., 2014. Employment effects of green energy policies. IZA World of Labor.
Rivers, N., 2013. Renewable energy and unemployment: A general equilibrium analysis. Resource and Energy Economics, 35(4), pp.467-485.
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Question 
CHOOSE ANY TOPIC OF YOUR CHOICE – Using different sources of information (e.g., journal articles, books, newspapers, or websites), review the literature around the topic of your choice. Your literature review should include the following:-
Distinguish different sources of information used in academic writing.
Impact of Renewable Energy on Employment
Evaluate the benefits of using different sources of information when compiling academic writing.
Explain how to formulate research aim(s), objectives, and questions.
- 1Review literature using a range of sources
2.2 Develop arguments from different perspectives in line with findings.
2.3 Present the output of the literature review.
3.1 Evaluate the different methods of collecting and analyzing data.
3.2 Use different methods to collect and analyze data.
4.1 Explain the importance of avoiding plagiarism and academic misconduct.
4.2 Produce a piece of academic writing, applying the Harvard Referencing system