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Create Jobs And Support A Just Transition

“I look at buildings and wonder about efficiency. Can we get miners back to work making our communities stronger and more efficient?”
– A Seat At The Table participant, Hindman, Kentucky

What is a Just Transition, and why is it important?

In this moment of rapid changes in our energy sector, Kentuckians have the opportunity to shape a just transition to a clean energy economy, one that works for all people.

There are important and varied perspectives about what Just Transition means here in Kentucky and around the world. In the Empower Kentucky Plan, Just Transition means an all-in, inclusive process to protect the well-being of affected workers and communities, address racial and economic inequality, and build a new, just, and sustainable economy.

This understanding of Just Transition has been shaped over many years by the work of members of Kentuckians For The Commonwealth and our labor and community allies around the country. In 2013, KFTC identified the following principles for a just transition:

  • Improve the quality of life for people and communities affected by economic disruption, environmental damage, and inequality
  • Foster inclusion, participation and collaboration
  • Generate good, stable and meaningful jobs and broad, fair access to them
  • Promote innovation, self-reliance and broadly held local wealth
  • Protect and restore public health and environment    
  • Respect the past while strengthening communities and culture
  • Consider the effects of decisions on future generations

A just transition in Kentucky starts by involving affected communities and workers to shape strategies to protect their well-being and support a bright future. Kentucky has lost more than 13,000 mining jobs since 2009, with coal employment dropping in 2016 to its lowest point since 1898.  The workers who have labored and risked their health and safety in our coal-based economy deserve our respect and financial security, along with opportunities to create and have good, meaningful livelihoods in the next economy.

But the work of Just Transition doesn’t stop there. A just transition also means directing investments to places where jobs have been lost and where poverty and/or racial disparities are high. It means scaling up energy efficiency and supporting locally owned renewable energy to create new clean energy jobs across Kentucky. It means ensuring full and fair access to job training and good jobs for disadvantaged workers, including displaced coal workers, women, people of color, young people, LGBT individuals, veterans, formerly incarcerated, and others. It means supporting worker owned cooperatives, homegrown small businesses, and entrepreneurs. And it means laying a solid foundation for thriving local economies by investing in good schools, public transportation, broadband infrastructure, public services, access to health care, and a strong public safety net.

How does this plan support job creation and a just transition?

Many reports, including the Empower Kentucky Plan, show that shifting to a clean energy economy leads to better health and more new jobs overall, while also contributing to some job losses in the fossil fuel sector.

For example, an analysis by the Labor Network for Sustainability showed that strategies to reduce overall CO2 emissions by 80% by 2050 would create, on average, 550,000 net new jobs per year for 35 years in the U.S. Most of those new jobs would be in manufacturing and construction industries, while most of the jobs lost would be in mining and gas extraction. The Economic Policy Institute took a comprehensive look at the job impacts of the EPA’s Clean Power Plan, which has a narrower goal of reducing CO2 emissions from only the electric power sector by 32% from 2005 levels by 2030. It found the CPP would lead to a net increase of 360,000 jobs by 2020, with net job creation falling to 15,000 jobs by 2030. This report also found that jobs being lost tended to be in industries that pay higher wages, are more likely to be union jobs, and are more likely to be held by workers without a college degree than the jobs being created in the clean energy sector or the economy as a whole.

An analysis of the Empower Kentucky Plan shows it creates 46,300 net additional job-years (an average of 3,100 net new jobs in each year for 15 years) for Kentuckians, compared to the business-as-usual scenario. Most of the new jobs created by this plan are driven by the emphasis on energy efficiency, including jobs in construction, engineering, installation, and electrical and energy services. Most of the jobs lost are directly or indirectly related to coal mining and power plants.

Deliberate actions and investments are needed to ensure that jobs created in the growing clean energy economy are high-quality, good paying jobs. Strong public policies can result in more better paying jobs, located in the communities that need them most, and accessible to dislocated and disadvantaged workers. Achieving those goals requires significant, sustained public investment, as well as collaboration, plans, actions, and policies.

Below are key recommendations for creating jobs and shaping a just transition in Kentucky as we shift to a clean energy economy. (Many of these proposals on just transition are closely linked with earlier recommendations for prioritizing health and equity.)

Empower Kentucky Recommendations

  1. Support a meaningful public process to shape a just transition to a clean energy economy.
    1. Meaningfully engage a broad, diverse set of Kentuckians (individuals, workers, businesses, communities, organizations, unions, educational institutions, and utilities) to shape a shared vision for an energy system that is good for all Kentuckians.
    2. Adopt strong statewide goals and a policy framework for reducing risk and harm to our health and climate and shaping a just transition to a clean energy economy.
  2. Create a Just Transition Fund to invest in workers and communities affected by job losses in the coal industry and utility sector.
    1. Establish a Just Transition Commission with diverse and strong community and worker representation, to shape policy recommendations, direct public investments in a just transition, and monitor outcomes.
    2. Create a Just Transition Fund, seeded with 20% of revenues from a price on CO2 pollution. Proceeds from this fund, totaling $387 million over 15 years, and other public investments should be directed to support displaced and disadvantaged workers, create clean energy jobs, and build a more diverse and sustainable local economy in affected communities. Possible uses include:
      • secure workers’ pension and health benefits;
      • provide high quality job training, career counseling, and education;
      • support apprenticeship and pre-apprenticeship programs that offer paid on-the-job training;
      • offer stipends or support during job training, search, or moves;
      • provide early retirement;
      • support local infrastructure improvements – especially clean energy projects;
      • support the development of worker cooperatives and entrepreneurship;
      • leverage other investments in local job creation, especially energy efficiency and renewable energy projects and energy efficient affordable housing.

The Empower Kentucky proposal to put a fee on CO2 pollution from Kentucky’s power plants is addressed in other sections of this plan will be mentioned only briefly here. This plan establishes a price on CO2 pollution from Kentucky’s electric power sector and the CO2 content of imported power, starting at $1 in 2018 and rising to $3 over 15 years. By 2032 this policy will generate nearly $2 billion in revenue. Eighty percent of those funds will be plowed back into efficiency programs across our economy, while 20% is invested in to support a just transition and job creation for affected workers and communities.

Establishing a fee on CO2 pollution is necessary part of the Empower Kentucky Plan for several reasons: It is needed to achieve significant pollution reductions in Kentucky. It also generates funds to support equitable public investments in a just transition for workers and communities and build an energy efficient economy. And importantly, it is part of an overall plan that results in more jobs, lower average bills, and better health in Kentucky by 2030 than the business as usual scenario.

  1. Make additional sustained, equitable public investments in communities most affected by energy sector job losses, cumulative pollution, high poverty, and racial disparities.
    1. Pass the RECLAIM Act, a bill in Congress to invest $1 billion from the Abandoned Mine Lands Fund to restore and develop abandoned mine sites, many of which are in Kentucky and other Central Appalachian states, and the Miners Protection Act, a bill to ensure pension and health benefits for retired miner workers.
    2. Invest additional state and federal resources in just transition efforts, including support for affected workers and communities and clean energy transformation in affected communities. One example is a bill introduced in 2015 by Sen. Bernie Sanders. Another is a bill recently passed in the Kentucky General Assembly creating a Kentucky Coal Fields Endowment Fund to support infrastructure projects and economic diversification in coal communities. The Obama administration’s Power+ Plan and Promise Zone Initiative offer examples of the kinds of diverse investments that are possible and needed.
    3. Ensure 18% of energy efficiency savings directly benefit low-income residents, and require at least 5% of shares in community solar projects to directly benefit low-income residents. These recommendations apply statewide, and would directly benefit just transition efforts in distressed coal communities.
  2. Make sure new clean energy jobs are good jobs and ensure fair access
    1. Set state job standards – including wages, benefits and a percentage of jobs to be filled by disadvantaged workers and local hires – for renewable energy and energy efficiency projects receiving state grants and incentives.
    2. Local governments, schools and utilities should establish job standards – including wages, benefits, and job access – before putting energy efficiency or renewable energy projects out to bid. Alternatively, they should use “best value contracting,” which rewards bids that provide good quality jobs and ensure access to those jobs for disadvantaged workers.
    3. Utilities, unions, workforce development agencies, community colleges and community organizations should collaborate to offer high quality pre-apprenticeship programs that provide training, skills certification, on-the-job training, and pathways to careers in the clean energy sector. These programs should prioritize participation by displaced and disadvantaged workers in affected communities.

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