Two new reports on the impacts of moving to a low-carbon economy show putting money toward energy efficiency, building retrofits and renewable energy projects can create 1.7 million new jobs, significantly more than the same investment in fossil fuel industries.

The reports were released today in tandem by four groups: Green for All, the Natural Resources Defense Council and the University of Massachusetts at Amherst's Political Economy Research Institute (PERI) worked together on the "Green Prosperity" study, while PERI also worked with the Center for American Progress on the "Economic Benefits" report.

Together, the reports show the economic, environmental and social impacts of investing about $150 billion per year in energy efficiency and clean energy technologies; that number includes funding from the federal stimulus package signed into law in February as well as the proposals in the Waxman-Markey climate bill that is currently making its way through Congress.

"[I]nvesting in clean energy for $1 million will generate 16.7 jobs; correspondingly, investing in fossil fuels generates about 5.3 jobs," explained Robert Pollin, the co-director of PERI and the lead author of both studies, in a press conference this morning. "When you net the two things out, you're going to get about 12 incremental jobs per million in spending by investing in clean energy."

In addition to creating these new jobs -- enough to cut the current unemployment levels in the U.S. by 1 percent, from the current 9.4 percent to 8.4 percent -- and trimming the country's carbon footprint, the investment proposed in the reports will also make well paid labor available on a large scale to working-class, blue-collar and less-educated workers.

Phaedra Ellis-Lampkin, the CEO of Green for All, explained that almost 900,000 of the estimated 1.7 million jobs created through these investments would be accessible to people with high school educations or less. The new clean economy jobs would offer a solid job ladder for workers to steadily improve their wages as they grow their skills.

The employment impacts of alternative energy sources, from the "Economic Benefits" report. Click for full-sized.

"This is an opportunity" to change how our economy works, Ellis-Lampkin explained, "and it's our obligation to put policies in place to allow this economy to grow differently."

Importantly, Ellis-Lampkin and Peter Lehner, the executive director of the NRDC, both highlighted the fact that these job-growth estimates are net gains, factoring in jobs displaced in the fossil fuel industries as the economy shifts to renewables. The loss of existing jobs is a regular criticism of green-collar jobs proposals.

Retrofits, Public Transit, and the Smart Grid

There are three prongs to where these investments should occur, Pollin said. The biggest and most immediately beneficial is energy efficiency retrofits for existing buildings: Those projects make up 40 percent of the funding in the $150 billion annual project.

"Retrofits right now is a known technology," Pollin said, one that "creates fast returns with low risk, creates a lot of jobs in a construction industry that is flat on its back."

Making homes, schools and workplaces more energy efficient offers a significant boon to residents and business owners: Ellis-Lampkin estimates that boosting energy efficiency will decrease the cost of living for low-income households by 3 to 4 percent per year as energy bills shrink. From the "Economic Benefits" report:

An average-sized single-family home in the United States would require an investment of as little as $2,500 in energy-efficiency retrofits to produce a cost savings in the range of 30 percent per year. This would involve caulking to plug air leaks in the house and adding insulation to attics and basement ceilings. For an additional $2,500, further energy savings are available through replacing windows with air leaks and installing energy efficient appliances.

Similarly, public transportation investments will allow municipalities to get more for their dollar: Pollin said that every mile traveled on public transit produces half the greenhouse gases than in a private vehicle, and costs about half the amount to travel the same distance in a private vehicle.

The final leg of the investment project is smart grid technology, which the reports' authors suggest investments of about $44 billion per year to meet the growing demand for energy across the country.

"In the immediate term, energy efficiency is going to be the best investment," Pollin said. "Then, for the next decade we're going to see the creation of the clean energy economy."

Because these investments originate primarily from the private sector, the groups cited the importance of federal policy to shift the markets toward low-carbon technologies.

"This is not a question of whether the private sector spends the money, it's a question of if we spend it smart or stupid," said Peter Lehner, executive director of the Natural Resources Defense Council. "If we spend it well it will have tremendous impacts throughout the economy."

Both of the reports are available for download from GreenBiz.com: "Green Prosperity: How Clean-Energy Policies Can Fight Poverty and Raise Living Standards in the United States" and "The Economic Benefits of Investing in Clean Energy: How the Economic Stimulus Program and New Legislation Can Boost U.S. Economic Growth and Employment."

Construction photo CC-licensed by Flickr user gregor_y.