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Study Predicts Economic Windfall for State

Black & Veatch recently completed an economic impact study of renewable energy in Pennsylvania to determine potential benefits that investments could create for the Commonwealth of Pennsylvania. The study included a review of the current status of renewable energy development in the United States and Pennsylvania, characterization of renewable power generation technologies, assessment of Pennsylvania’s renewable resources and estimation of economic benefits the state would experience by adopting a Renewable Portfolio Standard (RPS) policy that would mandate their use to provide a percentage of the state’s energy.

Overland Park, Kansas – April 5, 2004 [SolarAccess.com] “Our findings concluded that investments in renewable energy resources would provide a windfall of economic benefits to the state of Pennsylvania,” said Ryan Pletka, Black & Veatch renewable energy project manager. “By instigating a shift from fossil fuels to sustainable renewable energy resources, the state could potentially create 85,000 net new jobs over the next 20 years and increase earnings by approximately $2.8 billion and state output by $10.1 billion.” The study compared the economic impacts of the RPS to a “business as usual” (BAU) case of building all fossil fuel resources over the course of 20 years. The analysis revealed that the RPS would result in $10.1 billion more in gross state output and $2.8 billion more in earnings over the 20 year time period than the BAU portfolio. Additionally, 129,000 new jobs over 20 years would be generated by developing renewable energy resources, compared to 44,000 for the BAU scenario (a net increase of 85,000). Impacts on consumer electricity prices would be small, equating to an increase of about 30 cents per month for the average residential customer. Reduction of fossil fuel consumption and prices are also potential benefits of renewable energy development. The Black & Veatch analysis revealed that a 1 percent reduction in fossil fuel prices could yield annual savings of $140 million, or 50 percent of the RPS cost premium, in 2015. According to the study, the state’s most abundant renewable energy resources include wind, solar, biomass, landfill gas and hydro. “The technical potential of these resources is capable of supplying more than the current Pennsylvania demand for electricity,” said Pletka. RPS policies have been a popular mechanism used by other states and countries to mandate a certain percentage of electricity be generated from renewable energy resources. To date, 12 states have implemented RPS policies, and many others are actively considering the adoption of an RPS. These policies have directly initiated the installation of thousand of megawatts of renewable energy and have helped to spur the 20 to 30 percent growth in wind energy capacity in the United States over the past 5 years. The study was performed for the Community Foundation for the Alleghenies, which was funded by the Heinz Endowments. To download a PDF version of the study, please access the following link: