In March alone around 106,400 jobs have been lost in areas such as builders of electric vehicles, installers of solar panels, energy efficiency retrofitters, and more.
With many projects in construction now on hold companies have been cutting discretionary spending with clean energy tax credits up in the air. Ellen Hughes-Cromwick, a fellow at the think tank Third Way and former Obama administration economist who was not involved in the E2 analysis commented those workforces are getting thrown to the sidelines,” adding “Clean energy is one of the first things to get thrifted when you go into a downturn.”
If this trend continues the renewable energy sector could lose half a million jobs by this summer, destroying the last five years’ worth of growth and development.
It has been reported that the majority of job losses in March were in the energy efficient sub-sector that involves upgrades on commercial buildings. As a result of these buildings closing, construction jobs have been postponed with little work to be done.
Hughes-Cromwick commented April is likely to be “another ugly month”, with numbers not predicted to rebound for some time even after social distancing procedure is reviewed and relaxed for coronavirus. She went on to say “Consumer spending and capital investment by companies are both likely to remain tepid, especially for non-essential services like clean energy, while the economy gets back on its feet.” Adding “It’s too early to tell where the bottom might be. That will likely depend on what kind of support, if any, Congress offers to the sector in its next round of stimulus funding.”
Green energy companies, particularly in the solar and wind companies, are looking for extensions of tax credits that balance the cost of installing and operating panels and turbines. This will allow these companies to provide prices that are more competitive than fossil fuel-powered electricity. Over the next year or two these credits are due to phase out; this means that construction delays could be fatal to many projects. The wind sector estimates that $35 billion in investments are at risk.
Hughes-Cromwick commented “We can’t leave this up to chance and let the chips fall where they may”