National business group Advanced Energy Economy (AEE) released results of a report that quantified significant economic benefits associated with investments in advanced clean energy deployment for the state of Arizona. The report, which was produced by international economics consultant Analysis Group for AEE, used an industry-standard modeling tool to estimate the impact of investing potential federal stimulus funds in advanced energy technologies, products, and services to boost economic activity in the wake of the COVID-19 slowdown.
The full report “Economic Impact of Stimulus Investment in Advanced Energy: An economic assessment of applying stimulus funds to advanced energy technologies, products, and services in Arizona,” is available here.
“As Arizona, like the rest of the nation, looks to recover from the economic impacts of the coronavirus health crisis, this report shows investment in advanced energy delivers huge returns to the state’s economy, creating in-state jobs and adding much-needed tax revenues,” said J.R. Tolbert, managing director at Advanced Energy Economy. “Such public stimulus also attracts billions of dollars in private investment and saves consumers — commercial and retail alike — billions annually.”
“By investing in energy efficiency and renewable energy, while accelerating the shift to zero-emission transportation, we can generate significant economic activity in the state’s hardest hit communities while also helping Arizona move toward an advanced energy future,” added Tolbert.
Specifically, the report shows that a hypothetical investment of $15 billion of public investment dollars in Arizona, allocated across a range of advanced energy technologies, would produce the following economic benefits:
- Adding a total of $209 billion to Arizona’s economy (Gross State Product), a 14-fold return on the public investment,
- Attracting $39 billion in complementary private investment, a contributor to GSP impact above,
- Creating 1.3 million new jobs, measured in job-years, resulting in a mix of short-term construction or installation employment along with ongoing positions,
- Increasing tax revenues by $10 billion to local and state governments, and
- Saving consumers $11 billion in energy costs annually.
The report found that energy efficiency investments delivered the greatest overall boost to the Arizona economy, totaling $172 billion in Gross State Product, and the most jobs (1 million job-years). The next biggest impact came from renewable energy generation (both solar and wind), totaling $17 billion, and 110,000 job-years of employment. Investments in electric transportation – electric vehicles and associated charging infrastructure – would contribute $9.9 billion in economic activity and create 83,000 jobs. Energy storage contributes $5.9 billion and 59,000 jobs.
In terms of consumer savings, energy efficiency investments produced the greatest benefits. For residential customers, energy efficiency would save $7.6 billion per year and rooftop solar $310 million annually. Commercial and industrial customers would save $3.4 billion per year from energy efficiency upgrades and onsite solar. Switching from gasoline-powered vehicles to electric would save drivers $270 million in fuel costs.
The report notes that a greater or lesser level of stimulus investment would result in greater or lesser economic impact, but the modeling shows that advanced energy stimulus investments can generate important and positive economic benefits in the state of Arizona, adding substantial value to the Arizona economy, creating millions of jobs, and sending additional revenue to state and local governments.
“Arizona is uniquely poised to leverage the economic benefits of deploying advanced energy technologies, with 69,000 employed in the sector and an established in-state supply chain involving a broad range of companies,” said Tolbert.
AEE’s Arizona Jobs fact sheet shows there were 69,000 workers employed in Arizona’s advanced energy industry in 2019, more than those working in schools and colleges, and twice those in agriculture and mining combined across the state. The sector experienced strong 3.5% jobs growth last year, beating the state’s overall 2.8% jobs growth rate, and employers reported they had expected a substantial 5% increase in jobs for 2020 before COVID-19 hit.
In January, Arizona Public Service (APS) announced a goal to deliver 100% clean, carbon-free electricity to customers by 2050, aiming to reach 65% clean energy by 2030, with 45% coming from renewable energy sources. APS also plans to end all coal-based generation by 2031. To help meet these goals and transportation electrification, AEE and 15 member companies worked with APS to identify 10 solution opportunities.
News item from AEE