Nations across the globe are knee-deep in the challenges that come with transition from fossil fuels to clean energy. Climate change and global warming a driving the efforts to reduce the carbon emissions that come from coal and other fossil fuel use, and advances in wind, solar, and nuclear power are helping develop strategies to make the shift. But other factors must also be considered while this shift is made, including how traditional coal-based energy towns can survive. The replacement of coal-fired power plants requires intense planning and thought–simply building a wind or solar farm without consideration for how these developments affect communities isn’t economically viable. Instead, it’s important that such plans be comprehensive in nature examining all the repercussions.
Such is the case in some states and communities already as they seek replacement of coal-fired power plants. Minnesota specially is pursuing a comprehensive plan for clean energy transitions from fossil fuels with entire communities in mind. Major investments are needed to achieve these efforts, including those at both state and federal levels. But at the same time, bold business solutions can help further by addressing specific community needs in the process. Such needs not only relate to job displacement and retraining workers. But it also involves accommodating losses to secondary small businesses affected by these transitions. Certainly, the goals are worthwhile in the long run. But protecting people’s livelihoods along the way is as well.
Case Study: Minnesota’s Clean Energy Efforts
In an effort to appreciate how clean energy transitions from fossil fuels might occur, Minnesota offers a potential template. Though the program is in its early stages, it nonetheless demonstrates a thoughtful approach to the replacement of coal-fired power plants. The Coalition of Utility Cities in the state has begun a transitions plan in seven specific cities. These cities are traditional energy towns with a long history of using coal to create energy. However, the program is drastically reducing coal as an energy source by closing several such plants in these cities. And instead, in their place, large solar farms are being constructed along with long-term, battery-based energy storage. This has resulted in a significant change in energy derived from coal use not only in the state but nationally. These efforts have contributed to coal now representing only 16% of the nation’s energy, down from 52% in 1990.
Naturally, building massive solar farms for the replacement of coal-fired power plants costs money. In this regard, Minnesota is leveraging tax credits offered via the Inflation Reduction Act for states building solar farms. The Inflation Reduction Act has a goal to cut 2005 carbon emission levels by 52% by 2030. Naturally, solar energy represents a means to achieve this goal, which explains federal tax credit supports. At the same time, Minnesota created a $4.75 million funding program for communities pursuing clean energy transitions from fossil fuels. And the state is investing millions in new industrial park with a greater focus on technology as opposed to fossil fuels. To date, Minnesota’s program has resulted in the closure of 24 of the state’s 36 coal power plants. Given that one plant burns 120,000 pounds of coal per hour, this is a substantial improvement in the state’s clean energy efforts.
Community Impacts Being Considered
The replacement of coal-fired power plants naturally requires an assessment of how communities will be directly impacted. In many smaller towns, including those in Minnesota, a significant portion of families rely on power plant incomes. Therefore, simply shutting these power plants down without additional supports undermines a community’s economic health and resilience. Assuming these same workers can simply adjust to clean energy transitions from fossil fuels is naïve. Working in solar and wind requires different skillsets and knowledge. And if communities lack alternative occupations for displaced workers, any clean energy project may be doomed before it is well started. For Minnesota, training workers for new skills is to be supported by state grants. And new industrial centers are to provide new job opportunities while helping communities become more resilient. Certainly, this is a good start.
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Direct impacts on coal workers and their families from the replacement of coal-fired power plants isn’t the only concern. In fact, secondary effects involving other industries also must be considered. In some communities in Minnesota, agricultural farms leased lands that are now being leased to solar farms. The same could occur with wind farms as well. Leasing to clean energy solutions tends to pay more than four times what a farmer might pay. That means land lease options can be seriously reduced within communities making clean energy transitions from fossil fuels. At the same time, there are cultural shifts that must take place as a community embraces clean energy over coal. Change is always difficult, and for small communities that have relied on coal for many decades, the shift is particularly hard. As such, social supports must also be in place to ease the pain of these transitions.
A Need for a More Comprehensive Approach
As the Minnesota case demonstrates, federal and state funding supports for the replacement of coal-fired power plants help. In addition to investing in clean energy transitions from fossil fuels, these funds are also helping communities change. But alone, such programs can only facilitate these shifts so far. These financial supports are limited, and they are not likely to meet the cultural and social needs of communities involved. This is where bold business solutions can come to the aid of these traditional energy towns. For example, developing coal worker training programs and courses for marketable skills represents one critical business opportunity. Likewise, agricultural supports that increase crop yields while reducing land requirements is another. Such needs will vary from one community to the next, but businesses can make a difference and complement state and federal efforts. And in all probability, businesses can devise much more comprehensive solutions that make clean energy success stories more probable.
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