The long-term effect of renewable electricity on employment in the United Kingdom

Abstract

Assessment of the employment impact of renewable electricity technologies is generally implemented through either complex and data-intensive methods (such as Computable General Equilibrium models) or simplistic approaches, normally focused on specific energy generation technologies, such as employment factors. In contrast, this article proposes a transparent and easily reproducible econometric methodology based on the Vector Error Correction model that uses aggregated and widely available data. The model is applied to the power generation sector in the United Kingdom using annual data from 1990 onwards and provides evidence that the long-term employment impact of renewable technologies is much higher than the impact arising from deploying nuclear or natural gas technologies.The impulse response function analysis indicates that a permanent 1 Gigawatt-hours increase in annual electricity supply generated by renewable technologies creates 3.5 jobs in the long-term period. Finally, this study derives the implications of the findings in the context of decarbonisation scenarios for the power sector in the United Kingdom and assesses the extent to which decarbonisation pathways based on renewable rather than nuclear technologies contribute to stimulating employment in the generation sector. Highlights Novel econometric methodology to estimate renewable energy net employment impact  Method employs relatively aggregated data on UK national level  1 GWh increase in annual renewable energy creates 3.5 long-term jobs  Renewable energy generates about 6 times more jobs than nuclear *

Towards a green economy in Europe: does renewable energy production has asymmetric effects on unemployment?

“…This finding is reliable with Arvanitopoulos and Agnolucci (2020), who noted that renewable energy production contributes to stimulating employment in the United Kingdom. This study also reported that 1 GWh increase in annual renewables creates 4.7 new jobs in the short-run period and 3.5 jobs in the long period.…”

“…Hillebrand et al (2006) revealed that renewable energy production has importance in their formulation of the labor market. Therefore, we follow Arvanitopoulos and Agnolucci (2020) and adopt the following long-run model:…”

Forecasting of China’s solar PV industry installed capacity and analyzing of employment effect: based on GRA-BiLSTM model

“…Therefore, the results of the model do not include indirect employment and induced employment. Some scholars also apply econometric methods such as vector error correction model and panel data analysis to the impact of renewable energy on employment (Arvanitopoulos and Agnolucci 2020 ), analyze the relationship between renewable energy installed capacity and job creation, and propose that every 1% increase in renewable energy generation capacity will increase employment by 0.48% (Proença and Fortes 2020 ).IRENA and Greenpeace International use the work intensity or employment factor (Vosniadou et al 2018 ) to measure the number of jobs gained from an increase in capacity or investment in given energy technology, and the results are highly transparent (Zhou et al, 2020 ). Rutovitz and Atherton ( 2009 ) elaborate on the EF approach to job creation potential in a low-carbon energy environment of the future as proposed in the Greenpeace Energy Plan.…”

Employment generation in net oil‐importing and net oil‐exporting countries: the role of energy consumption

“…The long-term response of employment to renewable electricity consumption in the U.K. is examined by Arvanitopoulos and Agnolucci (2020) with evidence supporting 3.5 jobs in response to 1 GWh increase in yearly renewable energy. For China, Mu et al (2018) reveal that about 15,800 and 45,100 direct and indirect jobs are induced by the expansion of wind power and solar PV by just 1 TWh, respectively.…”

“…The long‐term response of employment to renewable electricity consumption in the U.K. is examined by Arvanitopoulos and Agnolucci (2020) with evidence supporting 3.5 jobs in response to 1 GWh increase in yearly renewable energy. For China, Mu et al .…”