What renewable energy can mean for business
Last February, Democrats introduced the Green New Deal resolution in the United States Congress. The resolution is nonbinding but wide-ranging and an aspirational call-to-action for government-led efforts to combat the causes of climate change. The Green New Deal also seeks to invest in programs that will help communities fight the effects of climate change. In order for the Green New Deal to successfully implement its goals, such as achieving net-zero greenhouse gas emissions, the United States will need to change the transportation sector over to an electric mode of operation, alongside investing in renewable energies, and to deploy those cleaner energy technologies. These types of changes will send vibrations that will be felt through the energy industry.
As commendable as the Green New Deal is there could be a few major hiccups. By transitioning to renewable energy certain communities are going to suffer. Coal mining communities are already hurting, and their industry has been in decline for years. The industry will experience further loss, and a transition to clean energy may increase power prices and costs for transportation. Clean energy will create scores of new jobs; however, those jobs will require skills that are not prevalent in coal communities. The government will have to take a leading role in sparing these communities, however, companies will also need to work hard on making technologies more accessible, and by aiding in the transformation of vulnerable communities, companies will also potentially secure new revenue streams.
There are potentially two opportunities for companies. The first is to support the Green New Deal’s initiatives and create new economic opportunities in coal country. Some initiatives, such as The Reclaiming Appalachia Coalition, are working to set up agricultural projects like CBD and hemp farms, lavender field land conversion, outdoor resorts, and recycling centres. Companies can also expand access to renewable energy by working with the communities’ local governments. For example, one company installed 6,500 solar panels in Detroit in 2016. The second opportunity is to create inclusive business models. One proposed model is a subscription-based service. Members of the community could buy a subscription to solar and energy services that are owned and operated by a company or community. In this scenario, the community members will have access to clean energy, but they won’t have all the up-front costs that come with owning your own solar panels. Other initiatives will have to be created for low to moderate income families with other issues that will arise from the transition. An example of an issue is that low to moderate income families are the demographic most likely to invest in community solar programs but may have credit that’s too low to permit their participation. Some of these models may not be profitable, so governments will need to create new programs that encourage companies to partner with them to expand access to renewable energy.
The Green New Deal has a lot of promise, and there are a lot of reasons to implement it. The issues presented here, however, will need to be dealt with if they are going to implement such a bold and necessary transition.