The Future of the Labor-Climate Alliance

The Future of the Labor-Climate Alliance

Relying on the private sector to decarbonize is a recipe for abandoning workers.

Workers install a solar panel on a home in Washington, D.C. (J. Lawler Duggan/Washington Post via Getty Images)

President Joe Biden has emphasized the need for climate action since he was on the campaign trail. His platform included policies inspired by the Green New Deal, and one of his first acts in office was to issue an omnibus executive order calling for a “Whole of Government” approach to tackling the climate crisis. Then, in August 2022, he signed the Inflation Reduction Act. Heralded as the most significant piece of U.S. climate legislation to date, the IRA allocates $369 billion to incentivize clean energy, energy efficiency, electric vehicle purchases, and other supply-side measures to build demand for low-carbon technologies and products. Its underlying philosophy is that if renewable energy and low-carbon technology is cheap and plentiful, market dynamics will make fossil fuel production and use prohibitively expensive.

The IRA has also been promoted as a climate jobs bill; one estimate projects that the law will create roughly 900,000 jobs per year over the next decade. The Biden administration’s focus on good climate jobs is the result of the hard work of climate and labor activists alike. For decades, any attempt to expand environmental regulations was met with industry threats of job losses due to increased compliance and operation costs. Industries were able to successfully pit workers against environmentalists, who were perceived, at times with good reason, as elitists who cared more about animals than people. Now, after decades of organizing, unions have become more engaged in pushing for climate action, while climate advocates have recognized that workers are integral to winning ambitious climate policy. The job-creating power of decarbonization is an important draw for those who may not have been otherwise engaged in climate politics.

Equally important is the recognition that workers and the environment both face harm from companies. Capitalist principles reduce environmental protections to costs that cut into profits. The same goes for worker protections and wages. The IRA was an opportunity to provide an alternative model: investment in public projects and moving away from privatizing the clean energy economy. Instead, the law continues to place faith in the private sector to do right by workers and the climate. The underlying belief is that if enough incentives are provided, businesses will act in ways that are socially beneficial. An analysis by McKinsey found that the majority of energy and climate funding in the IRA comes in the form of tax credits for corporations. They will receive them regardless of what they pay in taxes; if the credit is more than the tax bill, they pocket the difference.

Furthermore, while the IRA is likely to spur private-sector renewable energy development and uptake of low-carbon technology, it does not fundamentally disrupt fossil fuel systems. There is no target for the reduction of fossil fuel use over time, no effort to force fossil fuel companies to diversify their energy portfolios, and no requirement that oil, gas, and coal stay in the ground. Money directed at negative emissions technology—carbon capture and storage (CCS) and carbon dioxide removal—translates to continued fossil fuel use if not coupled with a mandate to eventually end fossil fuel use. Despite billions spent, there has yet to be a successful CCS project that meaningfully captured emissions. And there is overwhelming empirical evidence that regardless of renewable energy production, fossil fuel production and use is not only continuing, but growing. In the United States, it is expected to reach a new record level this year, beating the previous one set in 2019.

The truth is that as long as fossil fuel production is profitable, companies will continue to extract and burn coal, oil, and gas. Meaningful climate action requires regulations and restrictions that will draw down the fossil fuel industry. A planned drawdown can also provide the time and resources necessary to support displaced workers and communities, which in turn can ease tensions that arise when climate policy more accurately reflects the economic impact of decarbonization. Relying on the private sector to decarbonize, by contrast, is a recipe for failing to support workers.

While progress has been made in bringing unions and climate activists together around the promise of green jobs, there is no way to address the climate crisis without ending the use of fossil fuels—which will result in job losses. This fact has led to continued tension between climate movements and labor movements, particularly at the national level. In big oil and gas pipeline fights, such as Keystone XL or Dakota Access, some unions, especially in the building trades, have come down in support of the developers because of the work pipeline construction generates for their members. On the other hand, many climate proposals continue to focus on emissions reductions, touting the creation of millions of jobs without discussion of their quality. Mainstream climate advocates are relatively quiet on the proliferation of low-wage, exploitative work in areas like in solar energy build-out.

There is an expectation, whether implicit or explicit, that fossil fuel workers should support decarbonization for the greater good, regardless of the economic uncertainty that it will bring. They may be able to find work in other industries, but there is a misguided expectation that they should support being displaced from their current jobs despite the uncertainties about future employment and the threat of economic insecurity.

The term “just transition” has become the go-to phrase for dealing with these conflicting concerns. The idea originated with labor and environmental justice advocates who believed workers and communities should be supported as the industries they relied upon financially were phased out. Applied to the energy transition, just transition argues for policies that support workers and communities as economies move away from fossil fuels. And research has shown that attitudes about an energy transition, even in fossil fuel regions, become more positive if there are social supports in place. But as just transition has become a more popular framework, it has been co-opted by entities with little concern for either workers or the environment. Shell has issued a “just and fair transition” declaration that provides no specifics and is undermined by its legal disclaimer that the company’s operating and planning budgets do not reflect any net-zero target. Many climate advocates, for their part, have claimed that any increase in renewable energy will produce a just transition with no discussion of the quality of the new jobs or who has access to them.

Corporate greenwashing and a lack of attention from climate groups increases distrust among fossil fuel workers and communities about the very idea of a just transition. An initiative as well-financed as the IRA could have shaped the meaning of the phrase, but here the IRA comes up short. A just transition requires the redevelopment of regions affected by job loss; the IRA could have directly allocated funding for these places via publicly built and owned renewable energy projects that would keep more revenue in communities. Instead, the IRA provides tax credit bonuses for clean energy projects in fossil fuel regions, with far fewer attendant social benefits.

The IRA’s approach to labor protections is the same as its approach to emissions reductions. Rather than mandating a prevailing wage or other labor provisions, there are bonuses for companies that provide them. The incentives certainly make creating good jobs more attractive, but they don’t change how difficult it is to unionize workplaces. States like Illinois and New York, by contrast, have passed climate policies that integrate labor standards into renewable energy projects over a certain size. The Illinois law also includes dedicated just transition funding. These efforts move past incentivizing good jobs to mandating them.

There have been some recent successes in other states. Last December, workers in Warren, Ohio, voted overwhelmingly to unionize Ultium Cells, an electric vehicle (EV) and components factory. Any vote to unionize is significant given how U.S. labor law is stacked against workers, but this victory was particularly noteworthy because of the dearth of unionized EV plants. Today, much of the auto industry is moving to the South, where right-to-work laws dominate. According to one analysis in 2021, electric vehicle and battery manufacturers had made plans to invest nearly $24 billion in factories across the region.

U.S. union density reached a record low in 2022. The private-sector unionization rate is just 6 percent; in auto manufacturing, the trend is not toward unionization but toward relocating plants in jurisdictions with weaker labor protections. Proterra, an electric bus manufacturing company long heralded as an example of a good union employer in a low-carbon sector, just announced that it was concentrating production in South Carolina, a right-to-work state, and closing its plant in California. Stellantis, the company that makes Jeep Cherokees, announced it was closing an Illinois plant that produced vehicles with internal combustion engines and moving those operations to Mexico, claiming the increased cost of manufacturing EVs meant it had to cut costs elsewhere. These examples show that despite the financial incentives in the IRA, companies are still relocating to places where labor costs are cheaper and labor protections are weaker. Moreover, EV production is less labor intensive than internal combustion engine production; a transition to EVs, even holding the number of cars manufactured even, means there will be fewer jobs available. Autoworkers are already being laid off in the transition to EV production—some estimates put the number as high as 80,000 lost jobs globally—and it is unclear what provisions are in place to support those workers.

The shaky foundations of the IRA make it all the more important that labor and climate organizers remain engaged with the process of implementation. Though it is federal legislation, much of the IRA’s success will depend on what happens at the state level, where rebates for energy-efficient appliances will be distributed, programs that receive federal funding will be administered, and much more. Moreover, while hiring union labor is encouraged and rewarded in the IRA, it is not guaranteed. Implementation will dictate how much of the work is union. The importance of implementation is why Ryan Pollock, lead organizer at IBEW Local 520 in Austin, Texas, believes that state governments should be organizing targets. (Pollock and his union were part of the coalition of unions that advised the creation of the Texas Climate Jobs Project to advocate for climate policy at the state level.) A hostile governor like Texas’s Greg Abbott can refuse to accept federal dollars that come from the IRA rather than fund state climate resilience efforts, or reject federal funds and projects that would require labor standards or other equity measures they oppose. Local organizing is necessary to push back against these hostile forces.

State and local organizing can also be more effective in bridging the tension between fossil fuel workers and climate policies. In Pollock’s experience, state-level organizing is also where you can build the support of fossil fuel workers and unions for climate policies: if you understand regional economic conditions, it’s easier to build relationships where you can have difficult conversations. As Pollock told me:

Using the organized building trades as an example, when I would explicitly use the words GND, I could practically see my brothers and sisters raise their hackles. However, when I would have conversations about the very ideas raised by the GND, without naming it, such as how we need to start planning for how our industries might be changing in the future and how that might affect both our careers and our union, then those very same people wouldn’t hesitate to listen and agree.

In addition to state and local organizing, another logical step to strengthen labor-climate advocacy is for more environmental and climate organizations to support legislative reforms to make organizing easier. Renamed in honor of the late leader of the AFL-CIO, the Richard L. Trumka Protecting the Right to Organize Act (PRO Act) was reintroduced with bipartisan support in February 2023. The PRO Act would override right-to-work laws and enact reforms to hold employers responsible for violating workers’ rights. Rather than fight plant by plant or warehouse by warehouse, the PRO Act would facilitate organizing everywhere, and therefore serve as a big step toward building a unionized clean energy economy. Several environmental organizations have already declared their support for the PRO Act, including the Sierra Club, whose own workers are unionized. Environmental organizations should go beyond communicating support for the bill and expend actual political capital to pressure elected officials on the issue. An easy step would be to include support for the PRO Act on legislator environmental scorecards to signal that labor organizing is considered a climate issue, and making endorsements contingent on support for the bill.

There is no prescriptive, one-size-fits-all path forward to building a labor-climate alliance. What cannot happen is a return to pushing for emissions reductions while leaving economic and social concerns aside, because of a mistaken belief in the tradeoff between expediency and efficacy. Ending fossil fuel use will require building power through multi-issue, broad-based coalitions. We are stronger together.

J. Mijin Cha is an assistant professor of environmental studies at the University of California, Santa Cruz. She is also a fellow at Cornell University’s Climate Jobs Institute and a member of the Climate and Community Project.

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