The number of clean energy jobs in Vermont has leveled off in the last four years after a period of substantial growth, according to the Vermont Clean Energy Industry Report, but has likely plunged amid the pandemic.
The state has lost 408 solar jobs since 2017, including 20 in 2019, the report found, despite growth nationally in the solar sector over the last two years. But the report, issued in May, does not account for jobs lost during the coronavirus pandemic. It estimates that Vermont lost 2,600 clean energy jobs in April alone. In June, VTDigger reported that 18% of renewable workers nationally sought unemployment benefits.
The report, conducted by BW Research Partners on behalf of the Vermont Clean Energy Development Fund, a branch of the Department of Public Service, showed that the clean energy sector represents about 6% of the state workforce, which is above the national average. It employed just shy of 19,000 workers before the coronavirus.
“We have a healthy clean energy sector still, with almost 6% of the workforce in some part of the clean energy sector, which is kind of holding steady where we’ve had before,” said Andy Perchlik, director of the Clean Energy Development Fund. Perchlik is also a Washington County state senator.
The findings were released as the Vermont Public Utility Commission considers its biannual update of the net metering program.
The debate about net metering compensation rates has gone on for years, with proponents arguing that the system, which pays corporations and individuals above retail rates for renewable power, helps the state increase production of renewable energy and creates jobs.
Others, including the Department of Public Service, contend that high net metering compensation rates disproportionately hurt low-income Vermonters and are no longer needed to sustain the industry.
This year, amid the uncertainty cast by the coronavirus, solar proponents say there is added weight to the PUC’s deliberations about net metering.
“With the reduction in local solar jobs and the tremendous reduction of new project permits, if we want to at least maintain the clean energy sector that we have, then we need to keep the existing opportunities through net metering, and not reduce them,” said Olivia Campbell Andersen, executive director of Renewable Energy Vermont.
Campbell Andersen says that, with federal tax credits set to decrease in the coming years, now is the time for the state to promote the development of new solar projects. Currently, the investment tax credit allows individuals and firms to deduct 26% of the cost of solar projects from their federal taxes. That number will drop to 22% in 2021, and then to 10% for commercial projects in 2020, and it will go away for individuals.
“Interest rates are low, so it makes sense to make these capital investments now and utilize the federal benefits that are available before they drop down, because two years from now, when the (tax credit) is just 10%, we will have lost a lot of value and opportunity for investment in local renewables,” she said.
The Public Utility Commission heard opinions on the net metering program in March, but decided to delay proceedings once the coronavirus hit.
In comments to the PUC, the Department of Public Service contended in March that compensation rates should go down. The department has not updated its comments since the coronavirus tabled the proceedings.
“Our concern has been — and the reason we recommended reducing compensation back in March was — on a per kWh basis, net metering is almost twice as expensive as what you can get for other solar,” said Ed McNamara, director of the department’s Regulated Utility Planning Division.
McNamara says net metering installations disproportionately go to wealthier towns and then drive up rates for lower-income electric customers.
“The economic disparity is still a concern, and actually has been heightened in the last few months,” he said.
But Campbell Andersen says solar jobs can help support Vermont’s economy, the way they did during the Great Recession in 2008.
“We’re ready to get back to work and grow the economic opportunities again,” she said. “But the state doesn’t seem very interested in that with some of the signalling we’ve been receiving, particularly from the Department of Public Service.”
McNamara says that lowering net metering compensation rates — and in turn, electricity costs — could help the state promote the use of electric vehicles and heat pumps.
“Being a state agency, our responsibility is to all Vermonters as a whole,” he said. “And right now, you actually have the greatest number of folks who have unpaid electric bills that we’ve ever had in Vermont. So adding more of an economic burden to those folks who can’t already pay their eclectic bills is a concern.”
In 2018, the PUC lowered net metering compensation for new systems to between about 13 and 18 cents per kWh.
Nils Behn, CEO of Aegis Renewable Energy in Waitsfield, says another drop in net metering compensation would significantly affect the number of new solar projects and hurt the solar industry.
“I can honestly tell you that the economics on projects in the state are at the tipping point,” Behn said. “They barely are economically viable under the current state of net metering. And any loss of net metering rates would very likely have a disproportionate reduction in deployed projects in the next year.”
Behn says renewable energy provides “some of the most viable jobs in a Covid world” due to easy social distancing conditions on sites and office positions that are adaptable to remote work.
“In a time when we need as many jobs in the state to keep the economics, to keep people employed in the state, and keep people working and paying taxes, it would be completely counterintuitive to make any move that would degrade the health of the solar industry,” he said.
McNamara says the Department of Public Service is still evaluating what to recommend to the PUC, given the job losses in the industry amid the pandemic. Comments are due by Aug. 31.
