Technical data

How to make America’s clean energy transition fair


This article originally appeared on World Resources Institute.

Existing and long-standing social and economic inequalities mean that climate change disproportionately endangers those least responsible for it.

Globally, fair climate action requires the United States, as the largest historical emitter of greenhouse gases, to dramatically reduce domestic emissions while increasing international financial commitments. Making the transition to net zero emissions in the United States – in a way that corrects historical inequalities and provides a fair distribution of costs and benefits – will require tackling decades of systematic discrimination. The federal government can play a critical role in effectively implementing equity-focused climate policy and stimulating climate investments to increase equity. Climate spending alone will not achieve the necessary systemic change. However, intentionally directing the expected economic, public health and quality of life benefits of clean energy to those who disproportionately bear the costs of a dirty energy system can begin to fight inequalities.

The energy transition in the United States must take into account the inequalities of the current energy system

More than one in four American households faces a high energy load, spending at least 6 percent of household income on energy, compared to a national average of 3.1 percent. A disproportionate number of Hispanic, Black, and Native American households face a high energy load compared to their share of households nationwide, with median household energy loads of 3.5%, 4.2%, and 4. 2% respectively, compared to 2.9% for white households, according to the United States Council for an Energy Efficient Economy.

Fair climate action requires the United States to significantly reduce its domestic emissions while increasing its international financial commitments.

As clean energy becomes increasingly available, access to it is not equal. Solar technology, for example, mostly benefited high-income households, who were four times more likely to adopt it than low-income families. Despite this, 42% of the residential rooftop solar potential is found in low to moderate income communities. This is due to a series of barriers to the use of solar technology, including high upfront costs and hard-to-access financial incentives, a lack of home ownership which can make it more difficult to use the solar power. solar energy and a lack of access to rooftops.

New clean energy spending and clean energy jobs are essential, but there is no guarantee of a fair distribution of the economic opportunities that accompany them. Although racial and gender diversity differs by sector, there is an apparent lack of gender diversity in all energy sectors. For example, a 2019 survey found that only 26% of the solar industry’s workforce identified as female, compared to 47% in the overall national workforce. The solar industry also has an above-average pay gap and reflects the dismal representation of women and people of color in leadership positions nationwide. This presents a broader challenge not only to employ a diverse workforce, but also to cultivate diversity in business ownership and leadership, for example through minority and owned businesses. women.

Congress and federal government ready to invest

President Joe Biden began his term by pledging to address these inequalities by supporting equitable climate action and environmental justice. The administration’s Justice40 initiative, which pledges to deliver at least 40 percent of the benefits of federal climate investments to underprivileged communities, comes to an inflection point in the country and in the federal government’s reckoning with discrimination systematic, its relationship with the climate and the environment, and its generational effects. .

The federal government can already help underprivileged communities by targeting investments that provide lasting benefits through direct payments such as the Bloat Support Program, project-based grants, loans, loan guarantees, etc. including the loan and loan guarantee program for power infrastructure, as well as technical assistance and training. as through the Equity in Energy initiative.

Congress envisions massive investments in clean energy transition through these and new programs. Congress recently passed the Infrastructure Investment and Jobs Act, which includes significant clean energy transition spending that can improve equity. One example is publicly accessible electric vehicle charging, with priority given to rural, low and moderate income neighborhoods and areas with a higher number of collective dwellings compared to single-family homes and private parking spaces. If done intentionally and successfully, public electric vehicle charging can increase the accessibility of electric vehicles and their benefits for these communities. Public charging of electric vehicles is also important for electrifying vehicles used for mass transit, which are often used more intensively than other cars and by low-income drivers.

But much remains to be done in terms of the scale of investments in clean energy transition and energy equity. Congress is reviewing the Build Back Better bill. This legislation would invest hundreds of billions of dollars in climate programs that can bring benefits to marginalized and disadvantaged communities, such as a $ 29 billion fund to finance zero-emission technologies, including energy goods and vehicles, for low-income and disadvantaged communities, and $ 3 billion for global climate justice grants. These are significant investments to reach underserved communities in the energy system, a fundamental prerequisite for a fair clean energy transition.

Targeted spending alone is not enough

Efficient and equitable clean energy expenditure must be combined with intentional and favorable investments in policies and processes. Disadvantaged communities face multiple overlapping social and economic inequalities that can limit the effectiveness of this funding, including a lack of access to capital, barriers to business ownership and exclusion from taking decision-making. To address this, federal policymakers and other authorities should consider:

  1. Data quality and availability: Clean energy spending can be fairly targeted through the implementation of effective, data-driven and results-driven energy equity programs based on a culture of metrics, reporting requirements , qualitative and quantitative data sources and analysis based on the experience and contribution of target households and communities.
  2. Local capacity building: The federal government should provide funding and technical assistance to build the capacity of states, local governments, community groups and other representatives of disadvantaged communities to lead the co-creation of opportunities, apply for federal funds and s ” engage in or implement programs.

The transition to clean energy is both limited and dependent on addressing systemic racism and wealth inequality in the United States.

  1. Community engagement: Federal actors should put the interests of historically excluded communities at the forefront of federal spending, while equipping and empowering these actors to lead the design, implementation and monitoring of programs. Incorporate pre-planning, community-led project design and funding for a strong, inclusive, respectful, culturally sensitive and intentional community partnership.
  2. Labor and purchasing policies: Federal actors can ensure that clean energy spending creates pathways to high-quality jobs for a diverse workforce by requiring that jobs created through federal spending meet wage standards, protecting the right to ‘organization, enforcing protections against harassment and discrimination, encouraging local hiring and engaging minority and women-owned businesses, and training and equipping currently under-represented members of the workforce clean energy to take advantage of new opportunities in the sector.
  3. Inclusive funding: Federal policies can support inclusive funding approaches to deploy clean energy and energy efficiency in low-income communities; Black, Latino and Indigenous communities, as well as other communities of color.

There is more to learn

The most impactful policies are based on contributions from communities and stakeholders and on the best available analysis. As the federal government turns more aggressively to tackle issues of climate and energy equity, it is critical to understand the economic impacts of proposed pathways to meeting U.S. clean energy goals, particularly in disadvantaged communities. This raises unresolved questions about how some of the enabling programs discussed above may affect the deployment of clean energy and job creation. WRI intends to address some of these questions with an upcoming analysis of the economic impact of decarbonization policies that prioritize disadvantaged communities and the creation of quality American jobs.

An opportunity not to be missed

Under the 117th Congress and the Biden administration, the federal government is seeking to invest unprecedented federal funding as part of a historic commitment to a cleaner, more equitable energy system. The clean energy transition is both constrained and dependent on addressing systemic racism and wealth inequality in the United States. Investments in clean energy that benefit marginalized, underserved or disadvantaged communities are essential to building a future that is less vulnerable to climate change and more prosperous for all.