Economic Benefits of Climate Investments

Beyond the climate benefits, investments in policies that decrease greenhouse gas emissions can be smart from an economic standpoint. Investments in energy efficiency, for example, can create jobs and also result in energy cost savings.

Job creation estimates are a combination of direct, indirect, and induced job numbers. Adding to these economic benefits, the money saved from lower energy bills is then put back into the economy and stimulates ongoing job creation. Such economic benefits can be forecast from investments in clean energy and mass public transportation as well, remembering that industry-specific job creation ignores any resulting job destruction in competing industries.

Estimates by Pollin, Garrett-Peltier, Heintz, and Hendricks (see graphic to the right) are that every $1 million invested in mass transit creates more than four times the jobs as the same investment in natural gas. Renewable energy investments create, on average, more than twice the number of jobs as investments in natural gas and coal. Fossil fuel extraction is typically mechanized and capital intensive while renewable energy production is more labor-intensive, which creates more jobs. In addition, fossil fuel infrastructure is already mature while investments in renewable energy expand renewable energy’s generation capacity.

Click to enlarge.

There will inevitably be job losses in existing fossil fuel and other high carbon sectors and protecting and transitioning those workers to new employment is fundamental to ensuring an equitable clean energy future.