WISCONSIN – Last week, the Milwaukee Journal Sentinel ‘Ideas Lab’ published a column from Robb Kahl, Executive Director of the Wisconsin Business Construction Group, a joint labor-management organization representing trade workers and contractors.
As explained in the column, and a recent report released by Forward Analytics, the single greatest factor in determining whether Wisconsin will maximize the impact of more than $2 billion in anticipated development of build utility-scale, renewable energy projects is whether or not Wisconsin workers are hired to do the job.
The full column can be viewed below or at this link.
Earlier this week, Kahl joined the Steve Scaffidi Show on AM620-WTMJ to discuss the column. Audio of that conversation is available here, beginning at 1:28:36.
Wisconsin can maximize the economic impact of renewable energy development if local workers build the projects
The last 20 years have seen a dramatic national shift in energy production to renewable sources, particularly wind and solar. That shift has been most pronounced over the last decade and been turbocharged over the last five years.
The unfortunate news is that Wisconsin has lagged the nation in adoption of renewable power, particularly in solar energy generation. The good news is that the state is poised to catch up quickly in the next several years. Wisconsin’s first large, utility-scale solar installation came online in 2020 and another 19 projects have recently been approved or are awaiting approval by the Wisconsin Public Service Commission.
This boom in solar energy generation will reduce the state’s dependence on fossil fuels and has the potential to help local Wisconsin communities where they are built. But whether solar energy generates real benefits for Wisconsinites will depend largely on how many local residents are put to work in good jobs building these projects.
With so many of these new projects expected to come online in the next few years, so few workers required to maintain them once built, and so few of the raw materials produced in Wisconsin, we wanted to understand how to maximize the economic impact for the state. What Forward Analytics, a division of the Wisconsin Counties Association, found is that the single greatest factor in generating economic impact is whether or not local workers are hired to do the construction.
The study looked at the local economic impact generated by the workforce required to install a 150-megawatt solar installation in Wisconsin. Specifically, examining the expected economic impact when using local workers vs. an out-of-state workforce.
The findings indicate that a 100% local workforce on a solar plant such as the 300 MW Koshkonong solar farm currently under consideration just west of Cambridge, would generate $43.3 million in wages and benefits, which would create $23.6 million in spending at local businesses if Wisconsin workers were hired for the build, and these numbers do not include the planned battery storage facility.
In contrast, a 100% out-of-state workforce would only generate as little as $9.2 million in local economic activity. In percentage terms, using local workers for such a project generates between 73% and 158% more economic activity. That means stronger communities and even more opportunities for Wisconsin workers.
The 19 solar projects currently pending in our state represent more than $2 billion in construction activity, more than the state’s latest two-year capital projects budget. That means that Wisconsin could see return on investment to the tune of at least $195 million in economic activity if local workers build all of these projects.
By comparison, employing an out-of-state workforce for these projects would generate between $83 million and $120 million less economic activity. Because these utility-scale installations are almost always sited in rural areas and counties, the required materials are not produced locally and have a negligible local economic impact. The labor costs, typically between 10% to 20% of this type of project, are where the local economy will be most impacted.
This means the opportunity exists for thousands of good, family-sustaining construction jobs in our state in the near future. The people of Wisconsin want these jobs to go to their neighbors and expect the PSC to insist on accountability for developers to ensure we seize this opportunity. In a recent statewide survey, nearly two thirds of respondents supported requiring developers to report to the public how many Wisconsin workers are employed on renewable energy projects.
Across party lines, the public expects that level of transparency in the utility-scale solar projects the PSC is currently considering. Approving all of them will increase our solar capacity by more than 400% in just a few years’ time. This will further reduce the state’s reliance on fossil fuels to supply electricity to state residents and represent a tremendous step forward on climate.
It’s up to policymakers to require developers to track and report the economic impact and makeup of the construction workforce on these projects to ensure Wisconsin workers, and our local communities, don’t miss out on this once-in-a-generation opportunity.