Clean Energy and Climate Policies Lead to Economic Growth in Montana

On the eve of U.S. Senate deliberations on climate legislation, a new analysis shows that comprehensive federal clean energy and climate legislation could create up to 13,000 jobs in Montana by 2020 and increase the state’s GDP by as much as $500 million a year. It would lead to average real household income in Montana that is $599 to $1,736 higher per year than without the legislation.

Based on collaborative research by the University of California, University of Illinois, and Yale University, the analyses reveals that clean energy legislation would create 918,000 to 1.9 million new jobs nationally, and increase national GDP by $39 billion to $111 billion more than what would occur without the legislation.

“This report shows that the stronger the federal energy and climate policies, the more Montana and the rest of the country stand to gain economically,” said David Roland-Holst, the report’s co-author and a professor of economics at the University of California. “Those who say we cannot afford to take action now need to realize we could miss a huge opportunity by not acting.”

Using a state-of-the-art forecasting model, the study evaluated the economic implications of three key components of federal climate legislation – energy efficiency, renewable energy and a cap-and-trade program for reducing carbon emissions – on the state of Montana. The study models moderate and aggressive implementation of policies that cap carbon emissions, create a market-based program to achieve emission reductions, and set strong standards and incentives for energy efficiency and renewable energy.

The study was co-released by Montana Business Leaders for Clean Energy, Environmental Entrepreneurs (E2) a national community of individual business leaders who advocate for good environmental policy while building economic prosperity, CERES, and The Clean Economy Network.

The analysis is available at: http://www.e2.org/jobs

Today’s report comes two weeks after eight Montana businesses met with the state’s two Senators in Washington urging them to support strong climate and energy legislation in 2009. The group also hand delivered a letter signed by more than 100 Montana businesses (http://www.climatesolutions.org/solutions/States/montana/september-25-montana-teleconference). The Clean Energy Jobs and American Power Act is being heard this week in the US Senate’s Environment and Public Works Committee.

“This report is nothing less than the roadmap to a more prosperous and stable future for us and our kids,” said Pete Strom, owner of several Bozeman-based businesses. “The Clean Energy Jobs bill will spur job growth and add up to $500 million to Montana’s economy. At the same time, it will dramatically increase national security and energy independence. Four birds with one stone. Congress needs to act — and quickly.”

“It’s simple: in this economy, Montana needs jobs, and there’s no industry out there with more potential than clean energy; but, Congress needs to act and send the right signals to the market,” said Barton Churchill of Independent Power Systems in Bozeman. “A good clean energy bill out of Congress could add 13,000 new, sustainable jobs in Montana. That’s a significant boost to our economy.”

Clean energy legislation will strengthen national security by reducing America’s dependence on imported fossil fuels so more resources can be directed to increasing renewable energy production and energy efficiency. Montana has significant and largely untapped potential renewable resources, particularly in wind power and biofuels. Furthermore, meaningful national legislation will reduce the pollution that causes global warming making it a win-win for Montana.

“Montana’s perfectly positioned to be the national leader in the new energy economy. If we step up to the plate in the battle for American energy security, we’ll be creating 5,000 to 13,000 thousand new, high-paying, Montana jobs. In fact, our business and many other Montana entrepreneurs are ready to hire more employees as soon as our market expands, and this report shows that’s exactly what the Clean Energy Jobs bill will do,” said Steve Corrick with Prudential Montana Real Estate in Missoula.

“A comprehensive clean energy and climate policy will help us continue to build a successful camelina industry on all fronts, providing significant economic opportunities for growers and processors,” said Scott Johnson, General Manager for Sustainable Oils. “Our focus on creating a renewable, low-carbon feedstock is reducing greenhouse gas emissions from fuels, but just as importantly injecting life into the local economy with additional growing opportunities for the region’s farmers.”

The cost reductions driven by climate legislation will boost our economy. Energy efficiency provisions in the legislation will reduce the costs for transportation, heating, electricity, etc., saving households, farmers and ranchers, and businesses money — money they can spend on domestic goods and services and create jobs.

"Improving energy efficiency cuts costs for transportation, heating, cooling and other energy demands,” said lead report co-author David Roland-Holst, “Money saved on energy puts dollars back in household bank accounts, and gives consumers the freedom to spend on things they want.”

More specific findings from the report on the economic impacts of federal climate legislation:

On a national level, create between 918 thousand (moderate efficiency case) and 1.9 million (high efficiency case) new jobs, increase annual household income by $487 to $1,175 per year, and boost GDP by $39 billion to $111 billion – with all of those benefits measured relative to a scenario without such legislation.
Create between 5 thousand and 13 thousand jobs in Montana – on top of a baseline increase of 76 thousand jobs over the same timeframe.
Increase Montana’s real Gross Domestic Product by $0.1 billion to $0.5 billion more than without legislation (2008$). That is a 0.4% to 1.4% increase on top of baseline growth of 26.9%.
Lead to average real household income in Montana that is $599 to $1,736 higher per year than without the legislation (2008 dollars).

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Additional contact information:

Pete Strom, PowerHouse Integrated Conservation Systems, [email protected] (406) 580-3228

Barton Churchill, Independent Power Systems, Bozeman, [email protected] (406) 600-8669

Van Jamison, Gaelectric, Helena and Great Falls, [email protected], Cell: (406)-459-2512; Office Direct: (406)-443-0815

Dennis Steinhauer, Archer Construction, Bozeman, [email protected], (406) 585-7770

Steve Corrick, Montana Prudential Real Estate, [email protected], (406) 329-2033

Dave Fischlowitz, Firschlowitz Building Services, [email protected], (406) 862-9222

Methodology: The economic analysis was conducted by University of California researchers using EAGLE, a state of the art forecasting model that details patterns of supply, demand, employment, incomes, resource allocation, energy use, and emissions, capturing both direct impacts and the extensive economy-wide indirect effects of climate and energy policies. The EAGLE results are consistent with modeling by U.S. government agencies – such as the EPA, CBO, and Department of Energy – all showing substantial economic benefits from the more efficient use of energy as part of comprehensive energy and climate legislation.