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New RAND Study Shows Dam Removal Wouldn't Hurt Region's Economy
A new study by the RAND Corporation shows the Northwest doesn't have to choose between affordable electricity and Columbia and Snake River salmon restoration. The study, released September 4, found that removing the four lower Snake River dams would have virtually no impact on the region's economy and could create as many as 15,000 new jobs. The RAND report also confirms that investing in energy efficiency and diversifying the region's energy mix with new renewable resources is sound economic policy.
Using a macro-economic model, Generating Electric Power in the Pacific Northwest: Implications of Alternative Technologies looked at the economic and employment impacts of alternative energy development scenarios, including replacing power now generated by the four dams with combinations of energy efficiency, wind and solar power. A second scenario replaces 20 percent of projected new gas-fired generation over the next 20 years with mixes of efficiency measures and renewable resources. The study assumes a business-as-usual approach to meeting the Northwest's growing need for electricity would rely mostly on new natural gas-fired power plants.
RAND found that both alternative paths would impact Gross Regional Product in the Northwest by about 0.2 percent, either positively or negatively, depending on assumptions made about future prices of gas, energy efficiency investments, and wind and solar power. "We can't say that's any different from zero," said Mark Bernstein , director of RAND's Environmental Science & Policy Center and study co-author.
Salmon restoration advocates see the study as a major step in reframing the debate over dam removal. "The RAND report rejects the myth that dam removal must pit jobs versus wildlife . . . A healthy economy and healthy ecology go hand in hand," said Pat Ford , executive director of Save Our Wild Salmon , in a September 5 Associated Press report.
The net employment figures for the dam removal scenario range from zero to 15,000 additional jobs, compared to business as usual. The range is mostly a function of the price of energy efficiency and renewable resources. The price of energy from the dams is relatively inexpensive. As the cost of power replacing the dams drops, economic growth increases and more jobs are created. The region realizes a net gain of 15,000 jobs if the dams are replaced with the least expensive energy efficiency measures (1.5 cents per kWh). The range also reflects jobs created from work associated with physically removing the dams and from a boost to local recreation expected to accompany dam removal.
The authors chose wind and solar power from among the many available renewable resource technologies because they say those two resources reflect the low and high ends of the cost range for renewables, wind being the lowest and solar the highest. The cost of energy efficiency measures considered in the study range up to 3 cents per kWh. Clean energy advocates note that RAND used conservative estimates for the cost of energy efficiency and wind power. A standard benchmark for measuring conservation's cost-effectiveness is the long-term outlook for the price of natural gas-fired generation, which is currently in the 3 to 4 cents per kWh range. And conservation gets added credit because it's stable and predictable in cost and doesn't produce greenhouse gases or other pollutants.
The study's 20-year projections for the price of wind is higher than generally accepted in the industry. Most experts predict wind power technology will continue to enjoy significant leaps in efficiency and accompanying gains in competitiveness which were not reflected in RAND's findings. The RAND study was paid for by PEW Charitable Trusts . The study's primary author is Christopher G. Pernin .
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Mark Glyde