In the absence of clear federal policy, states across the country are deciding whether and how to provide leadership on energy issues. In 2011, Massachusetts became the number one state in the nation for energy efficiency, overtaking California for the first time. According to the Massachusetts Clean Energy Center, the Commonwealth’s clean energy sector boasts nearly 5,000 firms and employs more than 64,000 workers – 1.5 % of the total state workforce. During 2010, the sector grew by 6.7%, while the rest of the state’s economy grew a little over 1%. This impressive growth is a direct result of state leaders recognizing the economic and environmental benefits of developing a clean energy sector. But the story would be incomplete if it were not for scientists, engineers, entrepreneurs and investors partnering with government on the vision and on implementation. Long term data is of course not in yet. This approach may be a model for the nation or at the very least an example of one way to fearlessly shape new markets and empower citizens and private enterprise to do their part.
Satisfied? Recently, business and government leaders in Massachusetts have been working to strengthen the state’s commitment. Over the past few months, both houses of the state legislature have passed significant energy bills to build upon the Green Communities Act, the landmark legislation passed in 2008 that made Massachusetts a national leader in renewable energy. A six-member conference committee is now tasked with reconciling two versions of the energy bill by the end of the current legislative session, which concludes July 31st. As Paul Gaynor, CEO of First Wind, and Jeremy McDiarmid, Massachusetts Director of Environment Northeast, explain in an opinion piece in the Boston Globe, the proposed legislation would expand the state’s growing clean energy economy, help keep energy spending local and create jobs locally.
Additionally, Massachusetts is one of nine states participating in the Regional Greenhouse Gas Initiative (RGGI), a market based regulatory program to reduce greenhouse gas emissions. Through the initiative, states in the northeast place a cap on all CO2 emissions, sell the emissions allowances through auctions and then invest the proceeds toward projects such as clean energy technologies and energy efficiency programs. In Massachusetts alone, allowance auctions have resulted in $498 million in revenue, and created 3,791 jobs. There is now a push to further strengthen RGGI by adjusting the cap to ensure it reduces emissions 20% below current levels by 2020 and is on track to reduce emissions by at least 80% by 2050 and to ensure that the revenues from the RGGI program are invested in energy efficiency and renewable energy programs that will save energy, lower costs, create local jobs and reduce pollution. Reports in Maine have called RGGI participation an “economic boon” and in New Jersey, the initiative is credited with creating jobs. Despite regular political resistance to the program, RGGI is said to have meant a $17M boost to the New Hampshire economy. The northeast is not alone of course. Texas, for one example, has some cutting edge incentive polices to encourage installation of wind power. The rest of the country – including California – could learn lots from these states, demonstrating the importance of regional initiatives rather than waiting for Washington to move.
There is still much more to be done in Massachusetts to complete an economic development plan that includes hitting ambitious greenhouse gas reduction targets, but legislative frameworks like those provided by the state’s Green Communities Act, and state participation in regional initiatives such as RGGI provide tools to achieve long-term sustainable economic growth, create thousands of regional jobs, and maintain a competitive advantage. We are doubly impressed by the initiative taken in the public sector to frame the energy issue in alignment with the public interest, and with the deliberate and thoughtful engagement of the private sector to be a full partner in achieving the desired outcomes. Sustainable economic growth, good jobs, increased energy independence, savings for families and businesses, cleaner environment? It sounds like leadership in action to us, and that is worth celebrating.