SBAM study projects net job losses if Proposal 3 passes
LANSING – Passage of Proposal 3, the 25 percent renewable energy
mandate, will result in 1,600-1,700 fewer jobs in Michigan every year for 30
years, according to an Anderson Economic Group study commissioned by the Small
Business Association of Michigan (SBAM).
“Anderson’s impartial analysis of the impact and costs of
Proposal 3 projects a loss of more than 50,000 Michigan jobs as a result of
higher costs,” says Rob Fowler, SBAM president/CEO. “Michigan can’t afford to
risk so many jobs.”
The
study considered Proposal 3’s effect on jobs in two ways. First, it considered
the reduction in the number of jobs in Michigan that would result from the
increase in electricity prices ($187 million in additional annual cost or $5.6
billion over 30 years), which would result in a decline in economic activity
and employment. Second, although jobs would be lost due to the increased cost
of electricity, some jobs would be created by electricity generators (an
initial six-year period ) as electricity suppliers increase the proportion of
their output that comes from renewable sources. But the net effect would be to
create a few jobs and destroy many jobs.
(see
attached chart.)
The study also finds fault with
the energy restrictions that Proposal 3 would enshrine in the Michigan
Constitution. It would define renewable energy sources as being wind, solar,
biomass and hydropower only, thus diverting investment away from other
renewable energy sources and away from investment in improving efficiency.
Proposal 3 also restricts electricity suppliers from buying cheaper renewable
sources outside the state.
Finally, the study says it is
not at all clear from the ballot wording whether the mandate requires price
increases resulting from incremental renewal generation costs to be limited to
one percent per year, or that price increases resulting from incremental
renewable generation costs may not push price increases above one percent, or
that the mandate limits price increases for any reason to one percent per year.
If Proposal 3 passes, the uncertainty would be enshrined in the Constitution.
“Michigan currently has a strong
law ensuring that a significant portion of our state’s energy portfolio
utilizes renewable sources of energy,” says Fowler. “We shouldn’t lock into the
Constitution anyone’s preconceived ideas about the proper mix of our energy
sources. Given the volatile nature of energy pricing and new technologies for
extracting clean-burning energy, Michigan can’t afford to be inflexible about
power sources. Approval of Proposal 3 would cement that inflexibility into our
Constitution.”
SBAM represents more than 17,000
small business owners in Michigan.
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