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Pennsylvania must redirect its economic development tools away from fossil fuel industries toward clean energy to build a stable economy that supports and protects the state’s most vulnerable communities, an environmental advocacy group said in a report released Thursday.
The paper by PennFuture recommends reforms for Pennsylvania’s primary state government economic development agency, the Department of Community and Economic Development (DCED), to prioritize projects that promote the state’s carbon-reduction goals and encompass impacts on the environment and community health in the ways it measures success.
“If we want to change how our economy is structured, or what the foundation of it is, or even reshape the future of it, we’ve really got to look at agencies specifically like the DCED, because that’s where government starts to get involved,” the report’s author, PennFuture Policy Manager for Sustainable Economics Donna Kohut, told the Capital-Star.
The report, titled “Economic Policy is Environmental Policy: Prioritizing Environmental Progress in Pennsylvania’s Department of Community and Economic Development,” examines the Keystone State’s historical dependence on fossil fuel extraction as a foundation of its economy and the ongoing impacts.
“Economic and environmental consequences from the prioritization of extracting polluting resources accumulated in the form of unsafe working conditions, falling wages, and a legacy of industrial degradation,” the report says, noting that the state’s cultural and political associations have allowed the fossil fuel industry to continue “business as usual” into the fracking era.
Kohut said that because fossil fuel extraction tends to be concentrated in specific communities, removing that industry has an outsized impact even if the closure of a coal mine, for example, results in the loss of relatively few jobs. That can make it hard for leaders to push for the transition to climate friendly energy sources.
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The fossil fuel industry’s long history also means that it is embedded in the state’s policymaking process, Kohut said, noting the inclusion of a number of energy industry executives on the board of Team PA, a public-private economic and policy development nonprofit organization co-chaired by Gov. Josh Shapiro.
“Their voices are elevated in a way that communities are not that environmental groups are not, that racial justice groups are not, that energy communities are not, right. They have the seat at the table, and so that entrenchment is a major obstacle,” Kohut said.
PennFuture is a nonprofit organization that advocates for clean energy, environmental protection, and sustainable communities.
The Pennsylvania Coal Alliance (PCA), which promotes coal mining and adjacent industries, released a report this week prepared by the Allegheny Conference on Economic Development detailing the industry’s economic impact. It is responsible for 11,547 jobs and $3.8 billion in economic activity, the report said.
“The current jobs within the industry, and many more in the broader economy, would not exist without the activity of the coal mining industry,” The PCA report said. “Similarly, the wages paid to industry employees have an effect on the broader economy, as employees use their compensation to buy goods and services.”
PennFuture said Pennsylvania is in a strong position to reiinvigorate its economy, address climate change, and become a leader in the clean energy revolution, the report says. But it cautions that Pennsylvania is falling behind industrial neighbors such as West Virginia and Ohio.
The DCED should be reformed to:
Establish climate accountability measures to institute green building and energy efficiency standards for large projects within the department’s funding structure;
Increase tracking and transparency of data to measure the impact of projects on climate goals and communities;
Be more responsive to communities to ensure everyone benefits from projects and incorporate environmental justice goals into the department’s funding and policy programs; and
Shift the department’s energy program away from attracting energy intensive industries to promote development of the state as a hub for manufacturing for the clean energy industry.
The report also recommends reshaping Pennsylvania’s collaboration with public and private partners to shift the economy toward clean and renewable energy sources.
Shapiro’s office declined to comment on the report and the DCED press office did not respond to a request for comment.
While the report praises Shapiro’s energy policy proposals to reduce carbon-dioxide emissions, boost investment in new clean energy sources and increase the share of the state’s energy supply from carbon-neutral sources, it critiques several recent economic development efforts as failures with regard to climate and environmental policy.
Shapiro announced his two-pronged energy strategy in March, outlining the Pennsylvania Climate Emissions Reduction Act (PACER) and Pennsylvania Reliable Energy Sustainability Standard (PRESS).
PACER would establish a program to cap carbon emissions and require fossil fuel power plants to invest in energy efficiency projects through the purchase of carbon credits. PRESS would expand the state’s portfolio of alternative energy sources to include next generation nuclear, fusion, and carbon capture and require 35% of the electricity produced in Pennsylvania to come from clean sources by 2035.
If the state Legislature passes bills to implement the strategies, Shapiro said he would withdraw the state from the Regional Greenhouse Gas Initiative, a multi-state cap-and-trade program that opponents argued was an illegal tax on energy. The Commonwealth Court ruled last year that Gov. Tom Wolf’s entry into the compact violated the state Constitution by usurping the authority of the General Assembly.
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In the report, PennFuture said it remains committed to RGGI but is open to an alternative that achieves the same reductions in carbon emissions. It noted, however, that ShapiroShaprio’s proposals are not reflected in DCED’s strategies.
But the report also examines state-backed energy development initiatives such as the Shell ethane cracker plant, which it describes as an “economic disappointment and an environmental nightmare.” The plant, intended to process natural gas into plastic feedstock, was built with a $1.65 billion tax break for Sshell but thus far has not delivered on its promise of new jobs and a boost to the local economy. Meanwhile, the plant has racked up $10 million in fines for air quality violations.
“The reality is that the environmental costs of the facility outweigh any minimal benefit to the local economy,” the PennFuture report says.
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