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Energy News

In Illinois energy bill negotiations, equity is taking center stage

All three major coalitions pushing for new clean energy legislation are touting social justice as a priority but vary on their approaches and accountability. 

As the country continues to grapple with its historic and ongoing racial injustices, equity is seen as a driving factor in Illinois energy legislation being hammered out in often-contentious negotiations leading up to the state’s fall veto session. 

At a state senate committee hearing on environmental justice and energy policy Oct. 22, community leaders talked about how Illinois’ 2017 Future Energy Jobs Act fell short in its promises of equitable access to the clean energy economy. This time around, they demanded new legislation do more. 

“If we train but don’t have jobs, if we have capital but don’t have projects, all of these things don’t work together and we end up with the situation we have,” said Delmar Gillus Jr., chief operating officer of Elevate Energy, the agency that administers an equity program created by FEJA. “We need to make sure we have a systematic approach to solving these problems.” 

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The coalition of community and clean energy groups that backs the proposed Clean Energy Jobs Act (CEJA) recently added beefed-up equity provisions to a bill that was already centered around environmental justice, as backers describe it. 

The proposal includes ambitious provisions for creating clean energy jobs and entrepreneurship opportunities for Black, Indigenous, People of Color (BIPOC) communities, as well as “just transition” provisions to aid communities where coal mines and fossil fuel plants close. The bill would also make equity a key factor in distributing the renewable energy credits (RECs) that are key to the state’s aggressive distributed solar targets. 

Also this month, a growing coalition of labor unions called Climate Jobs Illinois released its own energy platform, that calls for equity and diversity, labor protections and union participation in the clean energy sector. 

The labor unions aren’t backing a formal bill, but are demanding a lead role in negotiating legislation. Like CEJA, the unions call for extensive investments in a just transition for communities where power plants close, and for prioritizing communities—often communities of color—most affected by pollution from fossil fuel generation. Both the Clean Jobs Coalition that backs CEJA and the labor coalition also want public supports for the state’s nuclear plants, owned by scandal-plagued Exelon. 

Meanwhile renewable energy developers back a competing bill, called Path to 100, that they say would jumpstart the state’s flailing solar industry more quickly than CEJA, without ratepayer support for the nuclear plants. Path to 100 supporters this month held their own equity-focused press conference with members of the legislative Black Caucus. Thus far Path to 100’s equity components are much briefer and less specific than CEJA’s. 

“It’s a positive step and exciting that so many other groups have discovered the importance of equity and are at least saying the right things,” said Natural Resources Defense Council clean energy advocate J.C. Kibbey, a CEJA backer. “It’s encouraging we’re seeing more consensus around the issue, and we say welcome to everyone who is just getting here.”

CEJA expands equity measures 

The Illinois Solar for All program created by FEJA has been slow to create jobs or lead to solar installations in communities of color. The latest draft of CEJA would make such goals part of the adjustable block program which is at the heart of the state’s distributed solar expansion. 

CEJA calls for reserving 40% of RECs in the adjustable block program for projects that score high on an equity scale. As a CEJA memo explains, the scale prioritizes diverse workforces paid prevailing wage, minority-owned businesses, and projects with a labor peace agreement or community benefits agreement. 

Projects awarded the right to sell RECs early in the adjustable block program receive a higher price than those later in the program. Reserving RECs for diverse businesses would allow new companies more time to access the higher REC prices from the earlier blocks, rather than seeing them snapped up by existing, less-diverse companies. 

If it takes longer for the 40% pool of reserved RECs to be claimed, it becomes  more attractive for customers to work with companies that are meeting the higher equity bar, because of the higher REC prices, Clean Jobs Coalition members have explained. Illinois Solar for All would also still exist under CEJA, with the annual budget increased from $30 million to $50 million.

Under FEJA, the wildly popular community solar incentives program was dominated by relatively large (up to 2 MW) projects initiated by developers who then sought subscribers without a particular connection to a given community. CEJA calls for prioritizing community solar with meaningful community involvement and local ownership.

CEJA also aims to protect environmental justice communities from further pollution by demanding the Illinois EPA set different emissions limits on different coal plants in order to drive closures or emissions reductions in communities of color and marginalized communities. The limits should also get the state to zero carbon emissions by 2030, CEJA backers say.   

CEJA calls for creating a Displaced Energy Worker Bill of Rights that guarantees laid-off workers “financial advice, continued health care and retirement packages, and full tuition scholarships at Illinois state and community colleges and trade programs,” according to the memo. 

It also would create Clean Energy Empowerment Zones where tax breaks and other supports would be offered for new clean energy businesses in areas where plants have closed in the past 10 years or where they may close in the future.

CEJA proposes these measures be funded by a fee on emissions and a coal severance fee worth 6% of the gross value of coal.

The emissions fee would be capped at one cent per kilowatt hour of electricity produced, and could generate approximately $2 billion between 2021-2029, CEJA backers say. Unlike other states—including Wyoming, which has a 7% severance—Illinois does not currently have a coal severance fee, though one has been proposed periodically. The coal severance would generate about $70 million per year between 2021 and 2035, CEJA backers say. 

Under CEJA, 16 clean energy workforce hubs would pay participants a living wage to go through training and mentoring, with transportation and child care costs also subsidized. 

The hubs, located on Chicago’s South and Southwest side and in towns and suburbs statewide—would serve people of color, alumni of the foster care system, displaced fossil fuel workers, people returning from the criminal justice system, women, transgender people and youth. (White men who are not displaced from fossil fuel jobs would be the main demographic ineligible). 

The hubs—also funded by coal severance and an emissions fee—would be overseen by advisory boards and administrators from community organizations and environmental justice communities. 

Rev. Tony Pierce leads a church in Peoria, which has a large African American population and is home to the E.D. Edwards coal plant, which is scheduled to close by 2022. Pierce told the state senate hearing that clean energy jobs are crucial to helping communities of color recover from the ravages of the pandemic and pollution. 

“Since people generally hire and promote people who look like them, (minority-owned) alternative energy and energy efficiency contractors offer the greatest potential to create significant increases in minority employees and minority subcontractors,” said Pierce, who supports CEJA and is also board chair of Illinois People’s Action. 

In another new addition to the draft bill, CEJA would create a program for solar and energy efficiency job training in prisons, and would pair the program with mental health and other support.

CEJA would also create a Green Fund offering low- and zero-interest loans to clean energy businesses that meet equity criteria. It would create a $20 million fund offering project grants of up to $1 million for clean energy businesses with diverse ownership and workforces. And it would create an accelerator program offering technical assistance, mentoring, low-interest loans and other supports to clean energy contractors of color or from diverse backgrounds. 

Kibbey said CEJA backers still want legislation to include controversial capacity market reforms that would help the nuclear plants. Savings that CEJA backers say would be achieved through these reforms would be key to funding renewable development and equity provisions. Critics say such savings would not materialize, and Gov. J.B. Pritzker in his own energy platform released this summer opposed the capacity changes that CEJA seeks. (An NRDC spokesperson later said the coalition is open to other approaches that put clean energy — including nuclear — on a fair playing field with fossil fuels.)

Union coalition sees equity through labor rights 

The labor coalition Climate Jobs Illinois aims to make labor protections and standards and the existing union apprenticeship program integral to the clean energy sector. The group’s platform emphasizes equity and increased diversity. 

But the building and electric trade unions most directly involved in energy and the apprenticeship program have a long history of racial exclusion and lack of diversity, as critics and studies have noted. 

State Rep. Will Davis, who supports Path to 100, said he is skeptical of the union coalition’s ability to push an equitable energy transition.

“Labor has to offer some transparency on how they will ramp up the number of minorities in their apprenticeship program,” said Davis, adding unions will face “staunch opposition” from Black Caucus members until they do so.

Like CEJA, the unions call for overhauling the state’s solar incentives program. But they emphasize utility-scale rather than smaller distributed solar projects, and call for utility-scale developers to reveal their diversity data and hire more people of color.

The unions’ platform calls for 10 GW of new utility-scale solar and 4 GW of solar on schools, including in low-income and environmental justice areas. It cites a study in saying: “For every one gigawatt of utility-scale solar power installed, about 7,600 total jobs are saved or created, including 2,800 directly for skilled construction workers.”

Climate Jobs Illinois’ proposal also includes an aggressive just transition program. It proposes paying workers laid-off from coal, gas and nuclear plants three to five years’ worth of wages and benefits, along with subsidizing retraining and relocation costs. It also demands two years’ notice before a plant closes, and asks the government to compensate towns for the lost tax revenue when plants close. 

Like CEJA backers, the labor coalition proposes to fund these investments through an emissions fee on power plants. The union platform also says money could be raised through charges to ratepayers, and fees from clean energy developers that benefit from the energy transition. 

The labor coalition calls for bringing clean energy jobs under the umbrella of the state’s Rebuild Illinois program, created by last year’s capital spending bill. Rebuild Illinois calls for spending $45 billion over six years, creating 540,000 jobs. 

While Rebuild Illinois generally deals with state-funded and administered infrastructure projects, Climate Jobs Illinois executive director Nikki Budzinski said it could also be tailored to private-sector clean energy investments, especially since regulated utilities and publicly-administered incentives are involved. 

Budzinski said that nationwide, only about 4% of solar jobs are unionized. She noted that FEJA had no labor standards attached to solar incentives, something the coalition wants to change. 

“Through good labor standards, you have the most highly skilled workforce working on this transition, and they will be paid a living wage with benefits,” she said. She noted that small solar companies doing residential installations might not be able to guarantee stable employment at high wages, but companies building large community solar and utility-scale solar and wind projects should be required to do so. While employment even on utility-scale projects may be short-term, the labor union apprenticeship structure that the coalition wants to incorporate into energy legislation would also equip trainees for other opportunities. 

“They might be working on a solar project for a certain amount of time, then they might move to doing electric work inside a building, even beyond the clean energy sector,” Budzinski said. “There’s a lot of room for growth going forward.” 

The labor coalition recently added prominent members: the Illinois Federation of Teachers, and the SEIU Illinois State Council that represents 150,000 janitors, healthcare workers and public employees. The new members are more diverse than the traditional building trades, including many people of color who live in environmental justice communities and communities most impacted by the pandemic. SEIU Illinois State Council President Tom Balanoff said in a statement that his members have long been affected disproportionately by energy-related pollution, and “are ready to fight for a clean energy economy.” 

There appears to be significant common ground between the Clean Jobs Coalition and the unions. A statement provided by the Clean Jobs Coalition says that the unions’ principles “clearly align with many tenets of the Clean Energy Jobs Act, especially on holding utilities accountable and improving transparency, creating equity and jobs in communities of color, forging a just transition for communities where coal companies have cut and run, and a commitment to creating thousands of clean energy jobs by boldly addressing climate change.”

Path to 100: Jumpstart the industry, then talk equity 

Kibbey and Budzinski acknowledged that it may be difficult for sweeping energy legislation to pass in the state’s three-day veto session in November, or even the lame duck session in January. Kibbey said he’d rather see comprehensive legislation pass in the spring than something “piece-meal” with equity provisions added later. 

But renewable developers backing Path to 100 say legislation needs to pass immediately to rescue the state’s solar industry from a boom and bust cycle created by FEJA, not to mention the effects of the pandemic. 

“The solar cliff has to be addressed, so we know we can get these projects up and running again, and stem the job loss we’ve been experiencing,” said Davis, a Path to 100 supporter and leader of the Black Caucus. “Then we can start the real dialogue about diversity and inclusion.” 

Davis said it’s crucial that legislation include enforceable mandates for equity. But given that Path to 100 doesn’t include specific mandates thus far, Davis said he might support a bill to jumpstart the industry as soon as possible with equity provisions added later. 

“As a legislator who’s been around 18 years, I know you don’t always get what you want on the first try,” he said. 

Path to 100’s statement on equity cites the state Department of Commerce and Economic Opportunity’s workforce and entrepreneurship programs as a way to augment diversity in the industry. Davis said he’s seen much interest in clean energy jobs from African American and Latino communities, including at a job fair last spring, and he’s confident developers want to tap that potential. 

“The companies that are supporting Path to 100 have been very open and appreciative of the dialogue on increasing diversity, they appreciate when they go into minority communities, their workforce needs to reflect the people who live there,” Davis said. 

“We know that there’s a significant interest among diverse people who want to work (in clean energy). It’s similar to the way we’re looking at marijuana as an industry—it’s something new, we can get in on the ground floor, and truly shape it moving forward.”

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