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62–183 2010

REINVIGORATING THE ECONOMY THROUGH 

STIMULUS LEGISLATION: OPPORTUNITIES FOR ALL 

HEARING 

BEFORE THE

SELECT COMMITTEE ON 

ENERGY INDEPENDENCE 

AND GLOBAL WARMING 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED ELEVENTH CONGRESS 

FIRST SESSION 

JANUARY 15, 2009 

Serial No. 111–1 

( 

Printed for the use of the Select Committee on 

Energy Independence and Global Warming 

globalwarming.house.gov 


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SELECT COMMITTEE ON ENERGY INDEPENDENCE 

AND GLOBAL WARMING 

EDWARD J. MARKEY, Massachusetts, Chairman 

EARL BLUMENAUER, Oregon 

JAY INSLEE, Washington 

JOHN B. LARSON, Connecticut 

HILDA L. SOLIS, California 

STEPHANIE HERSETH SANDLIN, 

South Dakota 

EMANUEL CLEAVER, Missouri 

JOHN J. HALL, New York 

JERRY MCNERNEY, California 

F. JAMES SENSENBRENNER, JR., 

Wisconsin, Ranking Member 

JOHN B. SHADEGG, Arizona 

GREG WALDEN, Oregon 

CANDICE S. MILLER, Michigan 

JOHN SULLIVAN, Oklahoma 

MARSHA BLACKBURN, Tennessee 

PROFESSIONAL STAFF

GERARD J. WALDRON, Staff Director 

ALIYA BRODSKY, Chief Clerk 

THOMAS WEIMER, Minority Staff Director 


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C O N T E N T S 

Page 

Hon. Edward J. Markey, a Representative in Congress from the Commonwealth of Massachusetts, opening statement .................................................... 1 

Prepared statement .......................................................................................... 3 

Hon. F. James Sensenbrenner, Jr. a Representative in Congress from the 

State of Wisconsin, opening statement .............................................................. 5 

Hon. Earl Blumenauer, a Representative in Congress from the State of Oregon, opening statement ...................................................................................... 6 

Hon. John Shadegg, a Representative in Congress from the State of Arizona, 

opening statement ................................................................................................ 7 

Hon. John Hall, a Representative in Congress from the State of New York, 

opening statement ................................................................................................ 8 

Hon. Jay Inslee, a Representative in Congress from the State of Washington, 

opening statement ................................................................................................ 8 

Hon. Emanuel Cleaver II, a Representative in Congress from the State of 

Missouri, opening statement ............................................................................... 9 

WITNESSES

Hon. Michael A. Nutter, Mayor, City of Philadelphia .......................................... 10 

Prepared statement .......................................................................................... 14 

Hon. Douglas Palmer, Mayor, City of Trenton ...................................................... 28 

Prepared statement .......................................................................................... 31 

Mr. Van Jones, President, Green for All ............................................................... 39 

Prepared statement .......................................................................................... 42 

Ms. Denise Bode, CEO, American Wind Energy Association .............................. 48 

Prepared statement .......................................................................................... 51 

Dr. David Kreutzer, Senior Policy Analyst, Heritage Foundation ...................... 55 

Prepared statement .......................................................................................... 74 

Answers to submitted questions ...................................................................... 108 

Mr. Trevor Houser, Visiting Fellow, Peterson Institute for International Economics, Director, Energy and Climate Practice, Rhodium Group LLC ........... 80 

Prepared statement .......................................................................................... 83 

Answers to submitted questions ...................................................................... 114 

SUBMITTED MATERIALS

Hon. Edward J. Markey, letter of January 14, 2009, from the U.S. Green 

Building Council ................................................................................................... 117 


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REINVIGORATING THE ECONOMY THROUGH 

STIMULUS LEGISLATION: OPPORTUNITIES 

FOR ALL 

THURSDAY, JANUARY 15, 2009 

HOUSE OF REPRESENTATIVES, 

SELECT COMMITTEE ON ENERGY INDEPENDENCE

AND GLOBAL WARMING, 

Washington, DC. 

The committee met, pursuant to other business, at 2:20 p.m. in 

room 2172, Rayburn House Office Building, Hon. Edward J. Markey (chairman of the committee) presiding. 

Present: Representatives Markey, Blumenauer, Inslee, Larson, 

Solis, Herseth Sandlin, Cleaver, Hall, Sensenbrenner, Shadegg, 

Walden, Miller, Sullivan, and Blackburn. 

Staff present: Danielle Baussan, Jonathan Phillips. 

The CHAIRMAN. For that purpose, I welcome back the members 

of the select committee for the first hearing of a new year. The beginning of a new year often prompts people to appraise the previous 12 months and, sensing the promise of a fresh start, resolve 

to improve over the next 365 days. Though some New Year’s resolutions have a habit of going in one year and out the other, Congress cannot weaken its resolve to address two of the most important issues before the Nation, restoring the economy and fighting 

climate change. 

Over the past year, the U.S. economy suffered through a market 

meltdown, a foreclosure crisis, and volatile oil and commodity 

prices. During this time, 2.6 million U.S. jobs were lost; the Southeast suffered a serious drought; and a coal ash catastrophe in Tennessee created more environmental damage than the Exxon Valdez 

oil spill. We must prevent 2009 from having a similar summary. 

The Obama administration has outlined an economic stimulus 

plan to revive the economy through tax incentives and millions of 

jobs in renewable energy, infrastructure improvements, increased 

State and local aid, and improving the energy efficiency of buildings. These initiatives offer an unprecedented opportunity for green 

collar jobs and environmental reform to be the backbone of a 

stronger economy. 

Just this past week, it was reported that a sustainable building 

supply company, Serious Materials, is working with a bankruptcy 

court to buy a traditional window factory that closed last December. The company is trying to rehire 300 workers who were laid off 

with 3 days notice. Congress and the administration must support 

these efforts on a national scale. 


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The stimulus package cannot be a plan to dig ditches or create 

a couple of pork ridden specialty projects. These greenbacks should 

yield green results for all. A stimulus package focused on more efficient and renewable energy can result in greater labor intensity 

and higher wages than investing in oil production. 

This is not robbing Peter to pay Paul. The Center for American 

Progress predicts a net increase of jobs created if Congress supports expanding the renewable energy and energy efficiency industries. 

As the stimulus plan is adopted, it must reflect short-term and 

long-term benefits, direct infusion to States and localities, and 

kick-start economic and energy development. Energy efficiency and 

weatherization can be deployed immediately through existing skill 

sets and technology. Tax incentives can encourage greater investment and employment in renewable industries, while smart grid 

development can sustain a national network of long-term permanent employees. 

A green economy didn’t get us into this mess, but it can get us 

out. The promise of a green economy can be met in every State, in 

every demographic. It is estimated that 30 percent of jobs created 

or sustained through the stimulus bill will be in construction and 

manufacturing, with another large share in the retail, hospitality, 

and mining industry. These sectors employ many low- and middleincome workers who have been hardest hit by the recession. 

Technological advancements and corporate investment opportunities can augment these economic gains. Congress and the administration must seek ways to find a green economic tide that lifts all 

boats. 

Some people may look forward to the new year as a new start 

on old habits, but we cannot afford to overlook the opportunity to 

strengthen the economy by developing a globally competitive industry for renewable energy, restoring our failing infrastructure, and 

increasing environmental and energy security. This is one resolution we cannot and will not break. 

Let me turn and recognize the gentleman from Wisconsin, Mr. 

Sensenbrenner, for his opening statement. 

[The statement of Mr. Markey follows:] 


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Mr. SENSENBRENNER. Thank you very much, Mr. Chairman. Let 

me first start out by apologizing that I am going to have to leave 

a little after 3:00 because I have a plane to catch to get back to 

Wisconsin. We are not really into the global warming bit, particularly today when the high temperature is scheduled to be minus 2, 

but nonetheless I am happy that the committee has been reauthorized and that we will be working on this issue in the next 2 years. 

Despite having more than 50 hearings in the last Congress, the 

select committee never fully examined how legislative proposals to 

address global warming will truly affect the American economy. I 

think we are all for creating jobs, green jobs, brown jobs, purple 

jobs, any kind of jobs. But I think that we also have to recognize 

that there are consequences to whatever we do. And if a rising tide 

is to lift all boats, it shouldn’t be up to the Congress or the Federal 

Government to pick winners and losers. We live in a market economy. It is the market that will pick the winners and the losers, and 

we should not deprive people of their right to earn a living to support their family and to have a comfortable and acceptable lifestyle 

simply because they happen to be on the politically incorrect side 

of today’s equation. So we are going to have to look at what tradeoffs result from what we are dealing with here and what we are 

thinking of dealing with here. 

I look at the stimulus proposal as something that can either be 

very good or very bad, and not in between. Let me say that we hear 

from our friends on the other side of the aisle that this is all good 

and nothing is bad at all. I want to put a couple of things on the 

table. 

First of all, if all of this money is borrowed, we are going to have 

to pay it back sometime. And we are borrowing money in many 

cases from people who do not share our interests and values, like 

China and OPEC. 

Secondly, we have to look at what happened in Japan in the decade of the 1990s where they had stimulus packages that were almost entirely public works oriented; and there were more jobs created while the money was being spent building a new bullet train 

line or a new freeway or new buildings or whatever, but as soon 

as that federal or national government money ran out in Japan, 

then they were right back from where they started. And most Japanese call the decade of the 1990s the lost decade. We Americans 

cannot afford to repeat that, and I am afraid we might be going 

down that road. 

Now, finally, in terms of the whole issue of cap and tax——and 

that is what I call cap and trade, because the carbon credits that 

have to be bought are really a tax—we have got to be careful that 

the businesses that we are trying to help and the segments of the 

economy that we are trying to help with the stimulus package don’t 

end up having to pay on the other end what we are trying to give 

them on one end. 

For example, the concrete industry has a huge carbon footprint 

in it. Making concrete is probably more carbon emission intensive 

than driving your car between here and Philadelphia and back. 

And if we think we are creating jobs by improving our infrastructure, and a lot of that involves concrete, whether it is roads or 

bridges or buildings or things like that, we just have to make sure 


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that the government does not taketh away what it is giving with 

one hand. 

So I think we are going to have to look at this all very carefully, 

and we are going to have to look at it beyond the boundaries of the 

four corners of the piece of legislation that we will be voting on in 

the next couple of weeks. If we do that and do that properly, we 

will be doing ourselves and the American people a great favor. If 

we don’t do this properly, we are going to end up being asked to 

bail out more industries that we harm, either by sins of omission 

or sins of commission, and we are going to lose the accountability 

that we desperately need when the Federal Government appropriates a huge amount of money. 

And the final point I want to make on this whole business is accountability is really the key. There was no accountability with the 

TARP that was passed in September; there was no accountability 

with the Katrina money that was spent. And, if we do not have 

much, much better accountability, then we in Congress are breaching the trust that the American taxpayers have given to us to 

spend their tax money wisely and to the best possible effect. 

Thank you. 

The CHAIRMAN. The gentleman’s time has expired. 

The Chair recognizes the gentleman from Oregon, Mr. 

Blumenauer. 

Mr. BLUMENAUER. Thank you, Mr. Chairman. I appreciated the 

comments from my good friend from Wisconsin. I would take modest exception to the notion that we don’t care whether these are 

green jobs or brown jobs, because I think it is very important that 

we do not use the economic stimulus, the investments that we are 

going to make, to create jobs of the past that are in fact brown or 

black or dirty, however you want to term that. And it is not just 

the invisible hand of the market that has created dirty jobs. Many 

of these efforts were deliberately subsidized by the Federal Government, by our policies in terms of energy, tax, public lands, to— 

whether it is coal or nuclear or inefficient transportation patterns 

or Federal policies that virtually dictated suburban sprawl that 

made a huge problem, for example, for the inner city for Philadelphia, while it was subsidizing their competition. The notion that it 

is the invisible hand that has worked against Detroit when our tax 

dollars have subsidized the establishment of modern foreign owned 

factories in other States, I beg to differ. 

And I think, Mr. Chairman, part of what has been so important 

with this committee under your leadership is that for 2 years we 

have focused on what the security and economic provisions are. 

Some of our witnesses are no stranger to the committee or other 

committees that I sit on. They have been helping us to be able to 

develop many of the elements of this plan I think are excellent. I 

think it can be better. I look forward to hearing the comments from 

the witnesses here and working with them and with the committee 

to continue to push those boundaries. We can refine the package 

not just for what it means today, but it sets a standard for what 

this Congress and the new administration are going to do over the 

course of 4 years with reauthorization, with budget. This starts the 

job; it doesn’t finish it. 


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We need, however—and the distinguished ranking member is 

right on the money when he talks about how we are going to pay 

for these ultimately. Yes, we are going to stimulate. It would undercut our efforts if we would suddenly raise taxes and fees to pay 

for it now. But we are moving into an era where money does matter, and, again, creatively capturing, creating and capturing green 

value can help us finance this over time. And I look forward to 

working with the committee and especially our distinguished witnesses here today to be able to develop these boundaries. 

Thank you, Mr. Chairman. 

The CHAIRMAN. The gentleman has expired. The Chair recognizes the gentleman from Arizona, Mr. Shadegg. 

Mr. SHADEGG. Thank you, Mr. Chairman. I want to commend 

you for holding this hearing, and I want to thank you for the adoption of the rules and beg your forgiveness for my tardiness. I understand they passed unanimously, and I would have been happy 

to join in that. I am—given the restraint on opening statements 

which is occurring in other committees, I want to thank you for 

being generous in your allotment of time to opening statements in 

this committee, and hope it will continue to be the policy of this 

select committee, and I appreciate that very much. 

I think this is an interesting topic, and I think it is good that 

we are having this kind of dialogue. For me, stimulating the economy is extremely important. It comes down to people losing their 

jobs and people being unemployed and people suffering, but there 

is an interface between the economy and the environment. I think 

as a nation we have learned that when we have done gratuitous 

damage to the environment, it has been economically ill-advised as 

well. But, by the same token, I think it is generally true across the 

globe that nations that are financially prosperous and successful 

and doing well are the nations best able to protect the environment. That is one of the reasons why I think looking at a stimulus 

package and looking at a green component of a stimulus package 

is an appropriate thing to do. 

I was interviewed on the radio a week ago—actually, it was on 

a TV show, I think. And they wanted to know why I would not object to a green component of a stimulus package. I said, well, I 

think the Nation needs to be very concerned about its environment 

and needs to be looking at green issues, but we also need to look 

at those issues in the context of the economy. For example, I argue 

that there are things that we can do that both benefit the economy 

and benefit the environment. On, for example, the emission of 

greenhouse gases, I made a statement today in the Commerce 

Committee where I pointed out that there are things that we can 

do that have dual benefit, that both reduce greenhouse gases and 

also reduce our reliance on foreign energy. And relying on foreign 

energy is something that I think we have discovered is not good for 

the Nation. 

So I am anxious to stimulate the economy. I am anxious to do 

so in a way which is environmentally sensitive. I don’t think we 

can, using government money, spend our way out of the current 

economic troubles we are in, but I do believe that there are problems with our infrastructure in the country and that where we can 

look at projects that have both a stimulative value and a value that 


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benefits the economy, and particularly, for example, improving insulation in buildings, which will not only reduce greenhouse gases 

but also reduce our consumption of foreign oil, or we can make 

more efficient automobiles which will have those dual benefits, or 

where we can rely on renewables such as wind or solar, which will 

have that dual benefit, we should pursue those strategies first and 

foremost. 

The CHAIRMAN. I thank the gentleman. 

The Chair recognizes the gentleman from New York, Mr. Hall. 

Mr. HALL. Thank you, Mr. Chairman, for holding this hearing, 

and thank you to our witnesses for being here today. 

Our country is in a recession. Unemployment is on the rise, as 

are foreclosures. At the same time, the stock market is falling, 

wages are stagnating, and home prices are dropping as well, wiping out hard-earned equity for many families. So it is our responsibility to do whatever we can in the short term to stimulate the 

economy, but in doing so we should also make sure that our investments make sense in the long term and that they help solve the 

climate crisis. 

I believe that we need an economic stimulus package, and that 

by focusing on green jobs and green infrastructure we can create 

even more jobs than if we simply invest in traditional public works. 

In fact, we have heard testimony from other panels that that is the 

case. And in fact, we have in the past, other Congresses have in 

the past selected winners or losers; for instance, by exempting certain kinds of vehicles from emissions or safety standards or by allowing extractive industries to take minerals out of public lands 

without paying a fair royalty. 

Those are choices that are being made by government, and I 

think that we can make—we should either have a level playing 

field and not make choices like that, or we should try to favor those 

with the least environmental impact and most environmental benefit, such as renewable energy production, smart grid technology, 

energy efficiency, weatherization, which can not only create jobs 

but can have a multiplying effect, as my colleague Mr. Shadegg 

said, by saving consumers and businesses money on energy costs. 

And many weatherization projects are not so sophisticated as a 

highway or a bridge design. In fact, in my district we don’t call 

them shovel ready, they are already screw driver ready. Many of 

the construction trades people who were laid off of work because 

of the downturn in housing could be hired immediately to start saving this energy and saving people the cost of heating or cooling 

their homes and have an immediate impact on our economy. 

So these are good policy, economic, environmental policy, energy 

policy, and also for our sovereignty and our independence as a nation. I look forward to the testimony of our witnesses, and thank 

you again, Mr. Chairman. 

The CHAIRMAN. The gentleman’s time has expired. The Chair 

recognizes the gentleman from Washington State, Mr. Inslee. 

Mr. INSLEE. Thank you. I want to thank everybody for being 

here, especially Mr. Jones, whose brilliant book, Growing a Clean 

Economy, is just wonderful. And if you have a sleep problem, don’t 

read it; you won’t be able to go to sleep. Thanks for your great 

work. 


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I just want to point out, we are trying to maximize the amount 

of the renewable package that goes to energy. And the reason is, 

we want to have something that is quick but we want to have 

something that is enduring as well. And we know that the enduring job creation we are going to have is in green collar jobs. That 

is where the money is, that is where the jobs are. That is what is 

going to grow the economy for the next decade or two, not just for 

the next 60 days. 

And we think we have got quite a number of unexplored options 

available to us. Some of us are going to continue to try to improve 

the amount that has been dedicated to these green jobs, both in 

building and retrofitting our buildings so they are more energy efficient, which are immediate things we can do, R&D, lithium ion 

batteries. Some say we can’t do this right away. 

I had a company, Johnson Controls, just leave my office an hour 

ago. They can have a lithium ion battery manufacturing plant 

built, in operation, by next December. That is fast enough, and it 

is an enduring contribution. We cannot allow—and if we don’t put 

pedal to the metal in this renewable package, we are going to trade 

a dependence for Saudi Arabian oil for a dependence on Chinese 

lithium ion batteries. And that is why we are going to try to do as 

much as we can on this. 

And thanks for all your testimony. 

The CHAIRMAN. The gentleman’s time has expired. 

The Chair recognizes the former mayor of Kansas City, the gentleman from Missouri, Mr. Cleaver. 

Mr. CLEAVER. Thank you, Mr. Chairman. I appreciate the opportunity to be a part of this hearing, and thank you for calling it. 

Particularly, I got a chance to have some dialogue with a friend 

and mayor of Trenton, New Jersey. We served together during my 

terms as mayor of Kansas City, Doug Palmer. And of course Michael Nutter, who has already distinguished himself as mayor of 

Philadelphia. And as a former mayor, and my colleagues will tell 

you, at our meeting this morning every statement I made as we 

were talking about this package dealt more with issues with which 

mayors would be concerned, so much so that one of my members 

reminded me that I am the Fifth District Representative from Missouri in the United States Congress. 

But I am concerned that we are going to spend some enormous 

amounts, as I think we are, in trying to go into public housing, for 

example, retrofit them so that they are energy efficient. All of that 

is good. The problem is whether or not we have a sufficient workforce trained to do that. And if we are supposed to be screwdriver 

ready, as my colleague said, if these projects must go in 90 days, 

I am really concerned that we are going to leave out a large number of people who would otherwise have an opportunity to work in 

this arena but are simply not trained in putting up solar panels. 

And there is a job component, a job training component, but here 

again if that job—and if there is some stuff that doesn’t quite fit, 

I don’t know how you can train people for a job that has to begin 

in 90 days. Because if it doesn’t—my understanding is that if the 

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So I am interested in some exchange, some information, some 

suggestions that you might have on those particular subjects. 

Thank you, Mr. Chairman. I yield back the balance of my time. 

The CHAIRMAN. I thank the gentleman. The gentleman’s time 

has expired. 

The stimulus package is out. It has been announced, and the 

good news is that this committee is very pleased with what has 

been included in this sector. It reflects the 57 hearings that we had 

last year, it reflects the recommendations which we made with regard to what should be included in a stimulus package. There is 

$10 billion in the package to support wind energy; there is $4.5 billion for smart grid technology, which uses Internet technology, to 

make America smarter about energy use. There is $10 billion for 

grants to cities and States for efficiency programs. There is $6.2 

billion for weatherization. As Mr. Inslee referred to, there is actually a program for $2 billion in here for advanced battery research 

as we move to this electric vehicle future. 

So it is an excellent package. It starts to move us in the right 

direction off of energy dependence and towards the goal of solving 

the problem of climate change. 

Our panel today is extremely distinguished, and it has a pedigree 

that is unmatched by any panel that we have had before us. And 

we begin by—first of all, although I am a Patriots fan, Mayor Nutter, we are all rooting for you in Philadelphia to win. You are not 

a Jets fan, are you, Mayor Palmer? 

Mr. PALMER. Dallas Cowboys. At least I admitted it. 

The CHAIRMAN. So all the more reason to welcome you, Mayor 

Nutter, to the panel. You are a great mayor of a great city. We welcome you. Whenever you are ready, please begin. 

Mr. SHADEGG. A point of personal privilege. I just want to make 

sure that the ‘‘we all’’ doesn’t include those of us from Arizona, who 

will be rooting for the Arizona Cardinals. Thank you, Mr. Chairman. I do appreciate your sensitivity, but it is important to me. I 

do need to get reelected back in Arizona, and I don’t want the incorrect implication to arise. 

The CHAIRMAN. And if I ever said ‘‘we all,’’ then my mother is 

spinning in her grave somewhere. 

Mr. SHADEGG. I appreciate that, Mr. Chairman. I am glad I have 

had this chance to set the record straight. 

The CHAIRMAN. Mayor Nutter, whenever you are ready, please 

begin. 

STATEMENT OF THE HON. MICHAEL A. NUTTER, MAYOR, CITY 

OF PHILADELPHIA 

Mr. NUTTER. Good afternoon, Chairman Markey and Ranking 

Member Sensenbrenner, all members of this distinguished committee. Thank you very much for the opportunity to be with you 

this afternoon to give testimony. 

I will address the three questions posed to the City of Philadelphia by the committee, but let me first preface all my responses 

with an overarching comment about the evolving stimulus package. 

We as policymakers have grown accustomed to thinking of cities as 

warehouses of great need. But in a transition to a carbon constrained economy, cities are now repositories of great value. EconoVerDate Mar 15 2010 00:17 Dec 15, 2010 Jkt 062183 PO 00000 Frm 00014 Fmt 6633 Sfmt 6602 E:\HR\OC\B183.XXX B183

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mists and engineers have demonstrated that energy efficiency is 

the most effective way to reduce our energy consumption. Cities 

are, if you will, the Saudi Arabia of energy efficiency. With our vast 

portfolios of existing buildings and infrastructure, cities are the 

best places to find this energy resource. We are engaged in a great debate over an $800 billion package 

to forestall an unprecedented economic catastrophe; but if we are 

serious about spending the money quickly enough to stimulate the 

economy and wisely enough to maximize the life cycle benefits of 

those investments, then funding existing and scalable local projects 

is one key to that success. 

Where this rubber meets the road is on the streets of Philadelphia and many other cities across America. It is therefore critical 

that Congress design a Federal stimulus package that allows 

money to flow directly to cities and to those local programs that 

will spend the money quickly and wisely. 

Your first question was, how has the City of Philadelphia sought 

to strengthen its economy by reducing its impact on the environment? The City of Philadelphia has a long history of reaping the 

economic benefits of environmental stewardship of doing well by 

doing good, as our Quaker founders might say. While I could begin 

with that history, talking about William Penn’s establishment of 

our green country town in 1682, of course I want to be very respectful of the committee’s time today. So I will simply say that 

making Philadelphia the greenest city in America has become a 

hallmark challenge of my administration. 

In April, we will be launching our ambitious action plan to reduce our exposure to rising energy prices, limit our environmental 

footprint, and reposition our workforce in economic development 

strategies to leverage our enormous competitive advantage in an 

emerging green economy. Indeed, the whole effort could be described as strengthening our economy by reducing our environmental impact. 

Your second question posed: Specifically, how does storm water 

management affect cities and the environment? Two hundred years 

ago, Philadelphia was famous for many things, one of which was 

our water system. I am proud to say today that admiration for the 

Philadelphia Water Department, which has responsibility for our 

storm water management system, has only grown over the centuries. Cities such as New York and Boston, Washington, Milwaukee, and Philadelphia are spending billions of dollars to expand 

their storm water management systems to meet the requirements 

of the Clean Water Act of 1977. 

The traditional gray infrastructure approach to storm water 

management means building bigger and very expensive pipes buried in tunnels. That approach further disrupts the natural water 

cycle, effectively wasting the resource of the rainwater. Today, 

there are new approaches being pioneered by cities like Philadelphia to use nontraditional green infrastructure approaches to limit 

the negative impacts of past storm water management practices. 

These approaches, which have capital costs somewhat similar to 

gray infrastructure, all attempt to use the landscape itself to manage storm water, and are outlined in greater detail in my written 

testimony that was submitted. 


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Your third question: What policy that is likely to be included in 

a stimulus package would help Philadelphia and other cities rebound from a weak economy? In answering this question, I focused 

my testimony on local investments that we believe quickly increase 

employment by simply scaling up existing local programs and capacities. We organize these investments into two broad categories, 

a building retrofit program and a green infrastructure program. 

First, the retrofit program. There are enormous potential returns 

to energy saving investments in building retrofits, but the challenge is in designing effective programs. Building retrofits may be 

self-financing, but they are not self-implementing. They require 

both startup capital and effective delivery programs. 

The City of Philadelphia currently spends $19 million annually 

on housing preservation and weatherization, $11 million of which 

are supported by the CDBG program. These funds are used to provide weatherization improvements such as attic and wall insulation, window sealing and replacement, and upgraded heating 

equipment. We currently conduct some degree of weatherization in 

about 5,000 homes a year. How large can such an effort really be 

in Philadelphia? This work is truly caulk gun ready and could happen as quickly as funds are available. 

There are approximately 400,000 row houses in the City of Philadelphia. Using the estimates cited in my written testimony, we 

could raise the energy efficiency of, say, a quarter of those row 

houses by 20 percent. Examples are insulation, air-sealing, cool 

roofs, and so on. By investing $250 million over 2 years, 50,000 

projects would directly employ at least 1,000 people full time over 

the course of a year. 

The kind of weatherization proposal in the above example, insulation, air-sealing, cool roofs, typically has a simple payback in 

lower energy bills of about 2 years. In Philadelphia, we propose to 

use that payback to replenish the original $250 million; we propose 

to use that payback—with the replenished funds we could weatherize every row house in Philadelphia in less than a decade, harvesting a huge return in reduced energy consumption and greenhouse gas emissions. 

Capitalizing this effort with stimulus dollars that could be leveraged by other sources and used to create a revolving fund is critical 

to conducting building retrofits at a scale under current financial 

conditions. 

Now, a few words on the green infrastructure program. We want 

to deploy green space as a public utility by placing thousands of 

new trees on city streets; increasing the amount of green open 

space; using pervious pavement on parking lots and playgrounds; 

and building green roofs and bioswales. We can use green to supplement pipes. 

In the long run, green infrastructure investments are much more 

sustainable as an adaptive approach to climate change and sea 

level rise. In the short term, they improve air quality and lower the 

incidence of heat stress, support walkable streets, with bicycle and 

transit options, and provide access to outdoor amenities and fresh 

locally grown food. 


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And, finally, investing in green infrastructure technologies also 

makes us more competitive by growing our position in new green 

technologies and job skills. 

Philadelphia has an extensive catalog of green infrastructure 

projects that we have demonstrated in neighborhoods all across the 

city, from green streets to city farms. We have over $100 million 

worth of green infrastructure projects capable of producing benefits 

in terms of water, air quality, family sustaining employment, and 

more equitable access to healthy environments and food. But the 

current downward financial spiral is preventing us from making 

these investments. Providing stimulus funds for this innovative 

green infrastructure approach is critical to the City of Philadelphia 

realizing these benefits over the foreseeable future. 

In conclusion, Mr. Chairman, ranking member, and members of the committee, a $250 million building retrofit program in Philadelphia would be consistent with the creation of a $50 billion national program. A $100 million green infrastructure program in a 

city like Philadelphia is consistent with the creation of a $20 billion 

national program. This is less than 10 percent of an $800 billion 

stimulus package, 10 percent focused on effective local programs 

that create jobs while improving the environment. 

Mr. Chairman, ranking member, members of the committee, 

thank you very much. 

[The statement of Mr. Nutter follows:] 


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The CHAIRMAN. Thank you, Mayor Nutter, very much. 

Our next witness is the Honorable Douglas Palmer, the mayor of 

the City of Trenton. He has served four terms in office. He has 

been a champion of working families. He has also received the 

Phoenix Award by becoming a national leader on brownfields development, and he recently completed a 2-year term as the President 

of the U.S. Conference of Mayors. 

Welcome, Mayor Palmer. Whenever you are ready, please begin. 

STATEMENT OF THE HON. DOUGLAS PALMER, MAYOR, CITY 

OF TRENTON 

Mr. PALMER. Thank you, Mr. Chairman and members of the committee. It is a pleasure to be here with this very distinguished 

panel and my good friend and neighbor, Michael Nutter. It is also 

good to see former Mayor Cleaver. But once you are a mayor, you 

are always a mayor. 

I really want to thank you for the opportunity to appear today 

on behalf of the United States Conference of Mayors, who represent 

1,200 U.S. cities. And also on behalf of the Nation’s mayors, we 

also want to express our deep appreciation to the committee, especially you, Mr. Chairman, and Ranking Member Sensenbrenner, for 

holding a field hearing, as you remember, at our meeting in Seattle, Washington. And it was very fruitful. 

At that time, I was pleased to participate in this hearing to discuss the mayors’ energy and climate efforts, and most notably our 

call for enactment of the Energy Efficiency and Conservation Block 

Grant Program, which is a top priority of the Nation’s mayors for 

the economic recovery package. 

Immediately following your hearing, Congress enacted the 

EECBG program as part of the Energy Independence and Security 

Act of 2007, and thanks to your leadership, Mr. Chairman, members of this committee, and others throughout the Congress. Since 

that time, the Nation’s mayors, through the Conference of Mayors, 

joined by the National League of Cities and National Association 

of Counties, has spent many months urging Congress to fund this 

program so that we can accelerate our Nation’s efforts through 

community-based investments and other initiatives to grow green 

jobs and a greener economy. 

Mr. Chairman, also, we are pleased that the House of Representatives today released an outline of its American Recovery and Reinvestment Plan, and that plan includes $6.9 billion to help State 

and local governments make investments that make them more energy efficient and reduce their carbon footprint. 

Mr. Chairman, you asked for testimony on three priority concerns: How has the economic downturn affected cities’ efforts to 

meet fiscal and environmental goals? Can a green economic recovery package create jobs and stimulate the economy? And, how 

should stimulus funds between States and cities be allocated? 

The reality at the local level is the economic downturn is having 

a profound effect on our fiscal and environmental goals. We strongly believe that there is evidence that supports this; that the economic recovery plan can create jobs and stimulate the economy 

while providing significant environmental benefits for local areas. 


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Mr. Chairman, and members of the committee, our Nation’s cities and their metro areas are the engines of our national economy. 

Our 363 metro areas are home to 86 percent of U.S. employment, 

over 90 percent of wage income, and nearly 90 percent of our gross 

domestic product. Therefore, without the economic recovery of our 

cities and metros, there can be no U.S. recovery. 

We are going to release at our conference meeting this week a 

forecast of metro unemployment for 2009, which was prepared by 

Global Insight, and of course it is no secret the news will not be 

good. Almost all metros will see significant job declines in 2009, 

and an amazing number of our metro economies will experience no 

employment gains for the decade. And with your permission, I 

would like to add that report to the record. 

The CHAIRMAN. Without objection, it will be included in the 

record. 

Mr. PALMER. Complement this jobless picture with a significant 

loss in our tax base due to falling real estate prices, which you 

mentioned as a part of the foreclosure issue, and cities are left with 

almost no fiscal capacity to expand existing or start new initiatives 

on climate protection, energy efficiency, and energy independence, 

areas that are absolutely essential to building a competitive economy for the future. 

I want to move a little forward and talk about economic recovery 

plan, job stimulus, and local environmental goals. You know, mayors have been consistent in our views about the opportunity and 

necessity to put this Nation on a path to a green economy. This has 

certainly been a central theme of the mayors’ advocacy of the conference’s Main Street Economic Recovery Plan, which I will be glad 

to answer questions later, first released in early November. The 

Nation’s mayors have been urging Congress and the new administration to make a strong commitment to Main Street-oriented investments that will create jobs and reinvigorate the economy. 

Mr. Chairman, to support this Main Street recovery plan, we are 

continually surveying our mayors on investments that can immediately stimulate job creation from completed projects before the 

end of 2010. This weekend we will release an updated survey of 

ready-to-go projects that illustrate the variety and range of investments that could be made in cities all across the country. 

At our winter meeting, the conference will release its updated 

survey results based on responses from 779 cities, and one of 

course is in Phoenix, Arizona, just so you know, and Portland, and 

even in Wisconsin. We project that for each $1 billion in EECBG 

funding, about 10,000 local jobs in our cities would be created exclusive of the many other direct jobs in manufacturing and other 

direct and indirect jobs that will result. 

These projects could include, as has been mentioned, energy retrofits of public and private buildings, installation of solar panels or 

wind turbines, deployment of new energy distribution technologies 

that significantly increase energy efficiency, and the development 

of systems to capture and generate power from methane at landfills. 

Mr. Chairman, we also believe, in conclusion, that certainly 

through this formula one of the best ways to make sure that this 

money is done, as Mr. Sensenbrenner wants to see it is done, done 


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right, that there is competition. One of the best ways to do this and 

do it quickly is to put monies direct to cities. I love the States and 

I love the Governors, but I think if you want to see things happen 

right away, where the rubber meets the roads, are the Nation’s 

mayors that have projects that are transparent. No bridges to nowhere. A lot of times, any monies we spend have to be through all 

kinds of public bidding as well as other kinds of things that are 

transparent. My citizens in Trenton, they won’t allow me to put a 

bridge to nowhere. They would have my head. So we have the 

transparency. We can get the money out into our communities and 

our cities. And we suggest part of the monies that go, go direct to 

cities. 

And I want to thank you for having the opportunity to be on this 

distinguished panel, and look forward to answering any questions. 

[The statement of Mr. Palmer follows:] 


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The CHAIRMAN. Thank you, Mayor Palmer, very much. 

Our next witness, Van Jones, is the President of Green For All, 

and a Senior Fellow at the Center for American Progress. Mr. 

Jones also co-founded the Ella Baker Center for Human Rights and 

has received numerous awards, including being selected by Time 

Magazine last year as an environmental hero. 

We welcome you back, Mr. Jones. Whenever you are ready, 

please begin. 

STATEMENT OF VAN JONES, PRESIDENT, GREEN FOR ALL 

Mr. JONES. Thank you. Good to be here. 

Well, Mr. Chairman, other committee members, I am just happy 

to be here and I appreciate the opportunity to talk. I was here in 

2007 when the term ‘‘green collar job’’ was very rarely heard anywhere. This may have been the first place it was heard in Congress, and now it is everywhere. And that reflects something. It reflects a hunger and a desire on the part of the American people to 

solve the two biggest crises possibly ever to face this country, an 

economic catastrophe and a climate crisis, both of which could undermine our Nation’s security, our economy, not just now but for 

decades into the future. 

You, unlike the rest of us, next week we are going to be celebrating; you will celebrate for about 10 minutes and then you are 

going back to sweating, sweating over the details of this recovery, 

sweating over the details of how it is that we can actually beat the 

recession and global warming at the same time. 

The 111th Congress will be in the history books. A hundred 

years from now students will study this Congress, and they will 

ask one question: Were you able to solve the problem? Were you 

able to deal with this twin crisis? How did you do it? And you are 

going to get a grade from our great grandchildren, yes or no, pass 

or fail. 

The reason that green jobs are so important is because they are 

the most secure way to ensure success for this Congress, because 

while on the one hand we are facing an economic catastrophe and 

on the other we are facing a climate crisis, what we have to keep 

in mind is that everything that is good in the fight against global 

warming, everything that is good for the environment is a job. It 

is a job. Solar panels do not put themselves up. Wind turbines do 

not manufacture themselves. Buildings do not retrofit themselves 

and weatherize themselves. And in our industrial society, trees 

don’t even plant themselves. Everything that is good for the environment is in fact a job, and that is a key to a breakthrough. 

What I want to implore is three things. Keep in mind as we go 

forward that sometimes—and you know this from your personal 

life—sometimes something really bad has to happen before something really good can happen. Sometimes you have to have a breakdown before you can have a breakthrough. You look at your personal life; that is true. It is not after you had a bunch of good days 

in a row that you say, hey, I need to go on a diet or make a big 

change. It is when you get a bad diagnosis from a doctor, it is when 

something awful happens. That is when you sit down and say, I 

have got to make a difference here, I have got to make a change. 


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Well, we just got a bad diagnosis, and the whole country now is 

looking for a change. 

You have the opportunity to turn this breakdown into a breakthrough, and you can if you honor three principles: Number one, 

this is a chance for America finally to return to its roots as the 

most important economy in the world, not because we are the number one consumers, but because we are the number one producers. 

Congressman Inslee pointed out that there is an opportunity to 

bring green manufacturing jobs back to this country making batteries, making wind turbines, doing those things in the United 

States. Let us seize the opportunity to abandon the idea that we 

can forever be the most important economy in the world based on 

consumption, based on consumerism, based on credit cards. Let’s 

get back to building rather than borrowing in the United States. 

Number one. 

Number two, as we honor Congressman Sensenbrenner’s plea for 

accountability—and I will underscore that. We don’t want to see 

any more wasted money. We can’t afford it. We don’t want to see 

any more of the Katrinas and those kinds of things. We can’t afford 

it. But as we do that, let’s make sure we get our math right. This 

is a green economy we are trying to build, and in a green economy 

the math is different. You don’t just count what you spend, you 

count what you save. This is a key point: When you are building 

a green economy, you don’t just count what you spend, you count 

what you save. And a massive investment, as the mayors are calling for, in energy efficiency will save us money over the long term. 

And that is the importance of the Energy Efficiency and Conservation Block Grant that the mayors have fought so valiantly for. 

The third is simply this. We have an opportunity to do something 

that no generation of Americans has ever had the opportunity to 

do: We can build a green economy that Dr. King would be proud 

of. We have the opportunity to connect the people who most need 

work with the work that most needs to be done, and fight pollution 

and poverty at the same time, and be one country about it. We 

have a chance to slow up for just a second, as Congressman Cleaver said. We might have to delay 2 weeks to help some of the young 

men and young women that you represent to get a little bit more 

training to get involved. We might have to wait 3. We might have 

to hold up a month to get some of these young folks coming home 

from wars, coming home from prisons, coming out of high school, 

we might have to even wait an extra month to get them trained 

to become a part of this. But if we do that, we will have built a 

green wave that can lift all boats, we will have created green pathways out of poverty. We will show a new generation of Americans 

that we can stand together and do great things again, and that differences of color and class, starting point differences, don’t matter, 

because we have a big future that we are trying to fight for together. 

You as the leaders of the 111th Congress on this most pressing 

issue have the opportunity to make us the number one producer in 

the world, to change the math so we count what counts; we don’t 

just count what we spend, we also count what we save, and to connect the people who most need work to the work that most needs 


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to be done. And if you do that, our great, great grandchildren will 

give you an A-plus. 

Thank you very much. 

[The statement of Mr. Jones follows:] 


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Mr. PALMER. He gave my speech. 

The CHAIRMAN. Let’s hear it for Van Jones. What a great speech. 

Fantastic. I agree with you. We don’t agree on the Dallas Cowboys, 

but Van Jones we agree on. Is this a great panel? Come on, I told 

you it was a great panel starting out here. 

Our next witness is Denise Bode, who is the Chief Executive Officer of the American Wind Energy Association. She is a nationally 

recognized energy expert, and previously served as CEO of American Clean Skies Foundation and President of the Independent Petroleum Association of America. 

Is this recombinant political DNA? This is the Obama era, huh? 

The President of the American Petroleum Association is now the 

head of the American Wind Energy Association, and this is the way 

the wind is blowing now, huh? 

So Ms. Bode, we welcome you. Whenever you are ready, please 

begin. 

STATEMENT OF DENISE BODE, CEO, AMERICAN WIND ENERGY 

ASSOCIATION 

Ms. BODE. Thank you, Mr. Chairman, and Ranking Member Sensenbrenner, sorry he had to leave as well, and distinguished members of the committee, it is really a pleasure to be here. My name 

is Denise Bode, and I am CEO of American Wind Energy Association. 

Our association is a national trade association of America’s wind 

energy industry, with more than 1,800 member companies, including project developers, manufacturers, component and service supply. 

I have to tell you, I come at an extraordinary time, and sitting 

next to Van Jones, I swear I am so excited about the future. I was 

excited before, and now I just want to go out and do even better 

work to support this new era of green energy jobs. 

You know the economic, the national security, the energy and environmental challenges are numerous and momentous and, fortunately, the industry that I represent can play a key role in solving 

many of them for the future, including serving as economic driver. 

Last week, I had the opportunity to attend the President-elect’s 

speech where he announced that he wanted to double the amount 

of renewable energy over the next 3 years, and our industry is prepared to achieve that. In fact, to do so, though, we need Congress 

to adopt the right policies in this stimulus package as part of the 

economic recovery bill now being developed. And we have had great 

encouraging conversation over the past several days with Members 

of Congress, transition team, and I am really hopeful that when 

the details and the specs come out of this package it will include 

key provisions to enable us to continue to grow through the economic downturn. 

Let me tell you just a little about the status of the wind industry, 

because I think a lot of folks still think of it as kind of a boutique 

industry or not really a major part of the growing energy generation source. Last year was the fourth straight year of record growth 

in the industry. We are still compiling final numbers, but more 

than 7,500 megawatts of wind energy was installed, second only to 

natural gas for the fourth year running. Total wind energy capacity 


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is now over 24,000 megawatts, and that is equivalent to 18 typical 

coal-fired power plants, eight nuclear plants. That replaces 140 

million vehicles off the road. 

Our industry has seen significant growth, though, in manufacturing as well. More than 65 new or expanded manufacturing facilities have been announced or opened since January 2007. That 

is amazing. Twenty-one States, too. Not just in certain select areas. 

Auto sector facilities have retooled the manufacture for wind. A 

former appliance manufacturing plant was renovated to build turbine blades. And I suspect there is no other sector of the economy 

that can point to that kind of manufacturing growth over this difficult economic period. 

Even though our industry employs over 80,000 workers in goodpaying jobs, we are just getting started and growing. In May 2008, 

the U.S. Department of Energy released a report on the feasibility 

of achieving 20 percent of our Nation’s electricity from wind energy 

alone by 2030, and DOE concluded that with no—with absolutely 

no additional technological breakthroughs, that it is doable, and 

that achieving the level of deployment would have significant benefits for the environment and economy. And they talk about achieving that with increasing to over 500,000 jobs. And let me tell you, 

if you look at the numbers, since that report has been issued we 

have had met or exceeded every target every year in adding those 

megawatts. 

But while the wind industry growth has been strong, the industry has not been immune to the larger forces that have dragged our 

economy down. The market is not there for us either. In fact, major 

developers of wind farms have publicly announced plans to cut 

back on turbine installations by 25 to 50 percent in 2009. And that 

setback also impacts manufacturers. DMI Industries, a tower manufacturer, is laying off around 191 employees. There is a blade 

manufacturer laying off 150 workers, another, TPI Composites, another one delayed plans to hire 300 workers, and Trinity Structural 

Towers is laying off another 131. Many of those are from all across 

the U.S. 

Job losses will mount without congressional action. And, according to recent analysis, a failure to address the credit crisis and 

make sure tax incentives for renewable energy work in a down 

economy will result in the loss of 89,000 jobs in wind energy and 

related industries. 

Because wind industry is capital intensive in growing, many developers do not have enough income and large enough tax bills to 

directly use the tax incentives, the production tax credit and accelerated depreciation that is intended to permit renewable energy. 

Instead, they partner with financial institutions that can use the 

incentives to offset their own tax liabilities. 

The economic decline has eliminated many major financial players from the tax equity markets, dramatically reducing the ability 

of many wind power developers to realize the intended benefits of 

available tax incentives. In fact, the number of tax equity investors 

has been slashed from 20 in 2007 to approximately five today. Let 

me tell you, it is critically important that we make a huge difference in addressing the ability to utilize these tax incentives, and 

that is a lot to ask of only five investors. 


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Specific policies are needed in the economic recovery legislation. 

What the wind industry is seeking is temporary changes to Federal 

renewable energy incentives that will help expand the number of 

investors in renewable energy projects, assist in providing adequate 

capital for project development, and ensure that incentives provide 

the benefit Congress originally intended when extending the PTC. 

Specifically, we support changes that enable renewable energy developers to effectively monetize their tax credits and accelerated 

depreciation benefits to the extent they don’t have sufficient levels 

of taxable income to otherwise utilize those tax incentives. Why put 

it in place if you can’t use it? Allowing renewable energy developers 

to carry back PTCs against their tax liabilities over prior decades, 

and, third, a long-term extension of the PTC to provide a more stable environment for renewable energy developers. 

Thank you so much. I have a lot more I can talk about in question and answers, and I appreciate the opportunity for somebody 

that has worked in the fossil fuel area who has seen the light and 

has been working now in the clean energy in the wind power era 

to testify before you and to hopefully add to this debate. 

[The statement of Ms. Bode follows:] 


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The CHAIRMAN. Thank you very much. And thank you for being 

here as well. 

Our next witness, Dr. David Kreutzer, is Senior Policy Analyst 

in Energy Economics and Climate Change at the Heritage Foundation. He taught economics at James Madison for more than 20 

years, and he also served as the mayor of Dayton, Virginia in 2003 

and 2004. 

So we welcome you, sir. Whenever you are ready, please begin. 

STATEMENT OF DAVID KREUTZER, SENIOR POLICY ANALYST, 

HERITAGE FOUNDATION 

Mr. KREUTZER. Thank you very much. Mr. Chairman, I want to 

thank you and the members of the Select Committee on Energy 

Independence and Global Warming for this opportunity to address 

you. I would like to point out that I would thank you even more 

heartily if next time you have me speak before Van Jones instead 

of after. 

My name is David Kreutzer. I am Senior Policy Analyst in Energy Economics and Climate Change at the Heritage Foundation. 

The views I express in this testimony are my own and should not 

be construed as representing any official position of the Heritage 

Foundation. 

Concern with the state of our economy is understandable, as is 

the desire to take action to improve it. The committee has asked 

me to address several questions regarding economic stimulus as it 

relates to energy and climate policies. 

The first question is, how would mandatory restrictions on carbon emissions affect the U.S. economy? Mandatory restrictions on 

carbon dioxide emissions reduce economic growth and destroy jobs. 

Last summer, a colleague, Dr. Karen Campbell, and I analyzed the 

impact on the economy from regulating carbon dioxide as a Clean 

Air Act pollutant. We have attached that report to my testimony, 

and I hope it would be entered into the record. 

The CHAIRMAN. Without objection. 

[The information follows:] 


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Mr. KREUTZER. Thank you. 

The damage to the economy is significant. The aggregate income 

loss as measured by gross domestic product over the period 2009 

to 2029 is $6.8 trillion inflation-adjusted 2008 dollars: The job 

losses are also stunning. The manufacturing sector is especially 

hard hit, with job losses of nearly 3 million by the year 2029. Employment and machinery manufacturing and in rubber and plastic 

products and others drop by over 50 percent by that time. Of 

course, some of the unemployed manufacturing workers find jobs in 

the service sector, but not all of them. The net impact drops total 

employment for most years by more than 500,000 and in some 

years by over 800,000. All of these losses, by the way, are net of 

green job creation. A stimulus package should include provision to 

explicitly exempt carbon dioxide as a regulated pollutant under the 

Clean Air Act. 

The second question is, what energy policies should be included 

in an economic stimulus package? A stimulus package should not 

constrain energy supplies, but allow them to expand and to include 

provision to maintain and increase access to energy resources of all 

kinds, but also those on the Outer Continental Shelf. We should 

keep moving forward to develop those resources. And while the bigger impacts of this policy may not come for several years or more, 

it should be emphasized that this part of the stimulus package does 

not cost the government anything and may well avert an economic 

crisis in the future. 

The third question is, as it develops a stimulus package, what 

lessons can Congress learn from European policies on carbon emissions and energy? Some claim that programs forcing a move to a 

less carbon-intensive economy will actually stimulate the economy, 

create green jobs and increase income. The logic in supporting the 

analysis of these studies ignores the negative impact caused by diverting resources to green projects from other areas of the economy. 

Since they are already pursuing many of these programs, Europe 

provides a lesson. Though many factors determine economic 

growth, stock market performance and unemployment rates, European performance in these areas does not argue for green stimulus 

or for creating energy security through conservation. In 2008, the 

FTSE Euro 100 index, a broad measure of the Euro area stock 

market, lost 47.3 percent of its value while the Dow Jones Industrial Index for the United States dropped less, that is by 33.9 percent. Their economic growth was smaller, and their unemployment 

rate was higher than in the U.S. 

If European energy efficiency came from superior technology, we 

would expect to see lower energy prices than in the U.S.; instead, 

we see the opposite. The latest numbers for electricity costs show 

that household electricity prices are 50 to 200 percent higher in the 

European Union than in the United States, even for those European countries that lead the world in wind energy technology and 

use. Europe’s lower carbon footprint seems driven more by demandkilling higher prices than by efficiencies of a new energy economy. 

The European Union can claim to be leaders in producing wind turbines and can point to the many jobs in the factories that build 


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them, but that doesn’t mean their policies lead to a net job increase. 

Evidence better supports a contrary conclusion, that green initiatives cost more jobs than they create. A stimulus package that 

forces a move to forms of uncompetitive forms of energy will raise 

costs and thwart economic growth. Instead, a stimulus package 

should focus on policies that reduce costs and make production and 

employment more profitable. Done. 

[The statement of Mr. Kreutzer follows:] 


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The CHAIRMAN. Thank you, Mr. Kreutzer. 

And our final witness is Trevor Houser, who is a visiting professor at the Peterson Institute for International Economics. 

We welcome you, sir. 

STATEMENT OF TREVOR HOUSER, VISITING FELLOW, PETERSON INSTITUTE FOR INTERNATIONAL ECONOMICS, DIRECTOR, ENERGY AND CLIMATE PRACTICE, RHODIUM GROUP 

LLC 

Mr. HOUSER. Thanks very much, Mr. Chairman, and members of 

the committee. I thank you for inviting me to testify on this important and timely topic. 

My name is Trevor Houser, and I am a visiting fellow at the Peterson Institute for International Economics and director of the Energy and Climate Practice at the Rhodium Group, an economic research firm based in New York. 

Last year the Peterson Institute, in partnership with the World 

Resources Institute, launched a multi-year initiative to examine 

the economic trade and financial effects of energy and climate policy. Our initial effort, ‘‘Leveling the Carbon Playing Field,’’ was 

published last May and was the first in a series of reports we will 

be releasing between now and the international climate negotiations in Copenhagen later this year. 

As the 111th Congress and President-elect Obama begin to work 

this month on drafting an economic stimulus package, there was 

an interest reflected in the opening statements of members in this 

committee in directing government spending in a way that not only 

generates near-term economic growth and employment but also addresses long-term policy goals. Energy and environmental objectives, including reducing carbon dioxide emissions and dependence 

on foreign oil, are chief among these, and the notion of a green 

stimulus package has gained considerable traction among policy 

makers and attention in the press. 

A Wall Street Journal/NBC poll that was released yesterday indicates that public support is strongest for prospective energy and 

environmental components of a stimulus plan. Given the speed at 

which an economic recovery package is being drafted, there is a 

need for a frame work to help legislators evaluate which policies 

and programs to include in order to meet both the immediate and 

long-term policy goals. In a forthcoming report from the Peterson 

Institute, my colleagues and I assess a range of policy design options currently being considered in terms of their energy and environmental as well economic impact. 

In my testimony today, I would like to share some of the key 

findings of our study, and I am happy to follow up with members 

of the committee after the hearing to provide more detail on the 

work. I also have considerable more detail in the written testimony 

that was submitted. The study finds that well-tailored energy programs as part of a recovery package can create jobs and stimulate 

the economy while achieving significant cost savings for businesses, 

consumers and the government. At the same time, it is clear that 

$100 to $150 billion in energy-related investment today is far from 

sufficient to meet long-term energy security and climate change 

goals. 


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Green elements of a recovery package, however, can complement 

forthcoming energy and climate policy by focusing on four things: 

First would be market failures, opportunities to reduce energy demand and CO2 emissions through energy efficiency that will not 

likely respond to price-based energy or climate policies alone. The 

second is energy security, as market based climate policy aimed at 

reducing CO2 emissions, such as a cap-and-trade program or carbon tax, does not necessarily reduce dependence on foreign sources 

of energy. The third is technology hurdles, as uncertainty about the 

availability of critical low-carbon energy technology between 2012 

and 2030 creates anxiety about the future cost of climate policy. 

And the fourth is infrastructure bottlenecks. In addition to reducing costs, the deployment of low-carbon technology depends on the 

availability of enabling infrastructure. Whether electricity transmission, CO2 pipelines or mass transit, the government will necessarily have a role in building and regulating that infrastructure 

that facilitates a low-carbon economy. 

So with these principles in mind, let me provide some specific results from our analysis. And I think we have a chart up here. I like 

to hold off on the bubble charts until I get to that point as people’s 

attention immediately diverts from what I have to say. So let me 

walk you through what this shows here. So we modeled 10 different energy stimulus policy scenarios. And so on the Y axis here, 

it is a change in U.S. energy imports over the base case as projected by the Department of Energy in their annual energy outlook 

released in December. It is important to note that this includes 

both natural gas and oil imports. And in fact, in most of the scenarios, the decrease in energy imports is in the form of natural gas. 

On the X axis, we have a change in annual CO2 emissions on average between 2012 and 2020. And that is measured in million tons 

of CO2. 

The size of the bubble indicates the number of jobs created 2009 

to 2011. And what we include in here is both the direct jobs in the 

industry getting investment, the indirect jobs in supply chains, the 

induced jobs when the wages are spent, and the fourth category, 

which hasn’t been included as much in studies to date, is the jobs 

created by the energy efficiency savings, which was referenced by 

a couple of members on the committee. 

We subtract from that jobs lost in fossil-fuel industry by lower 

spending on oil, gas and electric power to create a sense of the net. 

Again, this is just for 2009 to 2011. We did similar analysis what 

the long-term job implications would be, which I am happy to share 

with the committee later. 

So some headline findings, investments in building efficiency 

hold the most promise for near-term job creation and long-run reductions in energy imports and CO2 emissions. Spending $10 million to weatherize homes and retrofit Federal buildings would create and sustain up to 100,000 jobs between 2009 and 2011, and 

save the economy between $1.4 to $3.1 billion a year between 2012 

and 2020. 

Incentives for renewable energy can yield comparable energy savings and large emission reductions but with more uncertainty. Extending the production tax credit would stimulate an additional 


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gigawatts of wind power capacity construction over business as 

usual between now and 2014. 

The CHAIRMAN. I am going to have to ask you to summarize, and 

then we have a Question and Answer Period, and we can come 

back to you. 

Mr. HOUSER. So let me wrap up. The one note I would want to 

leave you with is, when considering green stimulus items versus 

other items in the stimulus package, the one component that people haven’t considered is the long-term implications of energy savings. Money we borrow today will have to be paid back down the 

road. And the long-term revenue both to government, to households 

and in job creation can help offset some of those costs. 

[The statement of Mr. Houser follows:] 


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The CHAIRMAN. Thank you, Mr. Houser, very much. We will 

come back to you. 

Now we are going to go to a question-and-answer period. I would 

like to have a conversation with our two mayors in terms of how 

they envision the stimulus package, as you have heard the outlines, impacting your cities and other cities in the country, and 

what the job creation potential is and what the transformative capacity is of these programs to really even change the way in which 

the cities think of themselves. 

Could we begin with you, Mayor Nutter? 

Mr. NUTTER. Mr. Chairman, thank you very much for the question. 

I think there are two primary areas that I would draw attention 

to. The first is, as Mayor Palmer laid out and I have made the 

same case, and I raise this issue in my testimony, stimulus dollars 

coming directly to cities again with every respect to States, and you 

have to balance those interests, are dollars that are going to be immediately spent. We talk about—I heard a new term today, but I 

usually talk about shovel-ready, hammer-ready, money-ready, we 

heard about screw-diver-ready, and I am fine with that as well. 

That is a project that is 90 to 120 days, ready to go, can be completed in 2 years. 

The stimulation, quite frankly, to our economy from the Federal 

resources does two big things. One, helps us to not take counterbalancing actions of our own because of the economic crisis in our cities. And by that I mean, a couple of months ago, I had to announce 

that we were laying people off from city government, which is unfortunately putting more people out of work while the Federal Government is trying to put people back to work; cutbacks in programs 

and services and the like. So you stop a number of bad things from 

happening with the stimulus dollars. 

The second is, we are able to make the kind of investments that 

I talked about earlier in my testimony, and I know that Congressman Cleaver had to go, but I would lay out, for the record, his concern with regard to how quickly some people can be trained. I will 

tell you, in Philadelphia, there is a new job training program that 

has been developed by our Energy Coordinating Agency that will 

certify new weatherization specialists. Some of this training can be 

completed in as little as 2 weeks to get people ready to go and take 

on some of the challenges that are out there. Some programs may 

take longer. But there are many opportunities. Again, when you 

talk about what Van Jones is talking about in terms of green-collar 

jobs, these often are not jobs that take forever to get ready for. 

So we can put people to work. We have the population. We have 

the projects. Literally, Mr. Chairman, and members of the committee, all we are lacking is the resources to make these projects 

happen and make them a reality. 

The CHAIRMAN. Mayor Palmer, do you want to add to what 

Mayor Nutter just said? 

Mr. PALMER. Absolutely, and just the best way to get people in 

the inner cities and the metro economies is to give people jobs. I, 

like Mayor Nutter, have the unfortunate task to make tough decisions, but we are laying off people in the City of Trenton. We 

talked about closing libraries, rec centers. It is something no mayor 


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would want to do, and we struggle with that. But we need to get 

our people back to work. And you can do it, as Van was saying, as 

being producers. 

I will give you just a quick example of how you can take care of 

a number of things with stimulus money going direct to cities, 

which is a transparent process. In the City of Trenton, we have like 

many older northeast cities, problems with lead and how it affects 

our children and their ability to learn. We have estimated that we 

have about 4,000 homes in the City of Trenton that have lead problems. You can with stimulus dollars do two things. One, you can 

train people on how to abate all the houses that have lead problems, which help in terms of environmentally; all those houses at 

the same time be trained how to retrofit a lot of these homes as 

well, whether it is energy-efficient windows, whether it is thermostats or creating green or white roofs. Not only can you do that, but 

you are training people that are willing, ready and able to learn 

how to do those things. We are working with Public Service Electric and Gas, my city and Newark, for a training program with 

Isles and YouthBuild to do those kinds of things. When you look 

at retrofitting, public housing projects and getting the costs that 

you can measure, how much would it cost to reduce your energy 

efficiency in public housing, which has some of the largest buildings, New York City, for instance, or in Philadelphia or Trenton, 

Washington, D.C., get the cost of how much it will save in terms 

of energy, you can actually use that cost and, if the banks would 

give up the money, use that savings and get loans that you could 

retrofit public housing with the caveat as you are doing that to 

train the people that in public housing or around public housing or 

in the area code, to train those individuals for jobs. 

The CHAIRMAN. So you are saying that, in a lot of these areas, 

these are ready-to-go jobs with limited, with not a lot of training 

necessary, that produce a huge benefit for your cities and get people off the rolls and into a job. 

Mr. PALMER. And real quick, absolutely, we had the MainStreet, 

U.S. Conference of mayors did this MainStreet stimulus plan; 774 

cities participated, projects that are shovel-ready in 2 years, because we have many more than that that are sustainable and will 

be able to be done right and get moving right away. So it is not 

pie in the sky. It is things that can help our economy and help our 

citizens. 

The CHAIRMAN. Mr. Jones can you comment about what Mayor 

Nutter and Mayor Palmer just said? Just deal with the cities aspect of this if you could. 

Mr. JONES. I would be happy to, and hopefully, we will get a 

chance to talk about the rural agenda as well, but just to talk 

about cities for one second. There is a great program called Solar 

Richmond very close to where we are. They take people that come 

from disadvantaged backgrounds and teach them how to become 

solar panel installers in 6 weeks. What people have to remember 

is when we are talking about green jobs, we are not talking about 

space-age George Jetson, Buck Rogers science-fiction jobs that no 

one has ever heard of. We are talking about very familiar trades. 

We are talking about very familiar kinds of work but upgraded and 


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upskilled to function in a more carbon constrained environment. 

The Green Jobs Act which—— 

The CHAIRMAN. Just give me an example. Let’s take the Green 

Jobs Act. Let’s look at Trenton and Philadelphia here for a second. 

Give us a couple examples of programs that, if we pass this package, will have an immediate impact on cities like Trenton and 

Philadelphia. 

Mr. JONES. Sure, well, for instance, you take homes that are 

leaking energy, just to sort of go on your example whether public 

housing projects or frankly just regular homes. Most people are not 

going to—you can tell them all day if you wanted to that if you invested X amount of money, you will ultimately save $3,000, 

$20,000 on their energy bill. Most people do not have the ability 

to spend that $2,000 to $3,000 dollars right now. If you have a 

more collective approach, where we can actually deploy a workforce—look at the kind of jobs very low-skilled people can do right 

away. Energy auditing, knock on the door; you have a clip board. 

Knock on the door; you have a small laptop. You talk to that homeowner. You show them where they can make immediate improvements in terms of energy efficiency, but you also point out where 

a little bit more work—what is the next problem? Blowing and 

clean nontoxic insulation. That is a low-skilled job that can have 

an immediate impact that day on the heating and cooling cost of 

that building. What is next? Replacing windows that don’t fit, doors 

that don’t fit with high-performance windows and doors. Somebody 

has to make all those parts and bring them in. There is your manufacturing agenda that is getting ready to go. Replacing all those 

boilers and furnaces. Some are 20, 30 years old, incredibly inefficient, replacing them with new modern furnaces and boilers. You 

are going up the ladder now in terms of skill and training, and yet 

you can now retrofit homes with geothermal. You don’t even need 

a boiler. These are the kind of things that have immediate, shortterm effect in terms of stimulus to the economy but long-term effects in terms of savings and carbon reduction. 

The CHAIRMAN. Let me come back to you again, Mayor Nutter 

and Mayor Palmer. What is your response to Mr. Jones in terms 

of how this would impact Philadelphia or Trenton? 

Mr. NUTTER. Mr. Chairman, Mr. Jones is absolutely correct. We 

are doing about 5,000 homes a year in Philadelphia. If we were 

able to scale that up literally to about 100,000 houses, you will put 

thousands of people to work. You will dramatically lower the energy costs of those homeowners which, quite frankly, rather than 

the dollars going for energy resources, literally money back in their 

own pockets. We propose a program where for about $2,500 and in 

over 2 years, that homeowner would stay pretty much at the payment right that they have been making. We pay back those dollars 

into the fund and do more of this same kind of work, and after that 

point, the homeowner enjoys the benefits of significant 20- to 30- 

percent energy reduction costs. That is money literally going 

through the roof, out the door, rather than staying in their own 

pockets. This can work. It is the capitalization upfront of dollars 

that clearly here, that is the need, but I have got 400,000 flat roofs 

in Philadelphia. They are tar black roofs today. They can be pulled 


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or green later on and significantly reduce even the temperature in 

someone’s home just by changing it, the tar roof. 

Mr. JONES. That would be paint-brush ready. 

The CHAIRMAN. Mayor Palmer. 

Mr. PALMER. Absolutely. And mayors are leading the way, quite 

frankly, when the Federal Government didn’t. Our good friend from 

Seattle, Washington, Mayor Greg Nickels signed up now and started with 120 mayors to sign our Climate Protection Agreement. We 

have over 900. We are doing it now, except we can’t do it to the 

scale that we would like to do to the training and the retrofitting 

without an infusion of capital. 

The other thing it will do, if you have seniors and others that are 

on fixed incomes or just got laid off that are hurting, they are 

choosing between now—it used to be fuel and; food, now it is their 

energy costs. You can reduce their energy costs. You can help sustain their homes. Another thing you can do is, Van was saying— 

Mayor Nutter so well knows—we have got—I am not trying to be 

political. People need hope. When they have a job and they are people that are now being trained and helping people reduce energy, 

they have hope. They have a job they can walk through the neighborhoods and be proud about. They are not knocking people over 

the heads. They are not doing other kinds of things and the other 

thing that will go—— 

The CHAIRMAN. Turn on your mike. 

Mr. PALMER. It is on. The other thing they can do is become taxpayers as well, and so all of these things help. We can all be a part 

of this new recovery by making sure it is transparent, that we are 

all held accountable, and that is it is sustainable. 

The CHAIRMAN. Thank you. 

Chair recognizes the gentleman from Oregon, Mr. Blumenauer. 

Mr. BLUMENAUER. Thank you. 

I appreciate it, Mayor Nutter, where you were talking in a more 

comprehensive, way you talked about issues that were related for 

example to water quality as part of the economic stimulus, both in 

terms, perhaps, of the standards and the methodology. And I would 

put to you, actually to both our mayors, a request for you to help 

us as we work with the new administration to think about how we 

change the standards of the—and the relationship of the Federal 

partnership. A lot of it is prescriptive, having still scars that 

haven’t healed entirely from trying to work with the previous administration when I was in your shoes, trying to negotiate agreements with EPA about spending a couple billion dollars much more 

effectively if we were greening it. And we found out that people 

just wouldn’t accept the extent to which you, with the resources, 

with your fellow mayors, could help us develop alternative approaches for regulation where you would commit to, not just meet, 

but exceed the water quality standards, but we would cut a deal 

with you so that you could be more flexible, daylighting creeks, 

using maybe some investments upstream that would actually 

produce better water quality improvement than you spending massive sums for a river that is already polluted before it gets to you. 

Would you be willing to help us with your certified smart people 

that work with you to think about how we change those standards 

and give you some flexibility? 


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Mr. NUTTER. Yes. Absolutely, Congressman, this is some of the 

most important work that goes on in Philadelphia. We, again, not 

trying to brag too much about our great city, but the Philadelphia 

Water Department has been a leader in storm water management 

for a long, long period of time. And it is why I talked about it earlier. Sometimes, even though on the environmental side, when people talk about, well, we are just going to plant a lot of trees, and 

isn’t that nice? I love trees as much the next person. It is not just 

about trees. It is the fact that the trees absorb water. We create 

pits around the trees to take more water; 90 percent of the major 

storms in Philadelphia result in about an inch or less of rain fall. 

Rather than that water going in our storm water management system, it should be going into pervious surfaces all over the City of 

Philadelphia. That is being smart about green and not investing in 

the old gray infrastructure as opposed to green infrastructure to 

deal with storm water management issues. 

Mr. BLUMENAUER. You can help us, and I won’t take time now. 

I have some other questions for other panelists, and I want to circle 

back to you where you can help us, so we can look at this comprehensively with the new administration. 

You mentioned street trees, which deal with the heat island effect, the reduction of storm water runoff and actually some natural 

filtration, if we can think comprehensively so you can get multiple 

benefits and maybe move ahead of the line as we move this forward. 

Mayor Palmer, you referenced, I think, a partnership with your 

local utility. And I am curious, and Mr. Jones may have some observations along this line, we have thousands of utilities, public 

and private, around the country, electric, gas sewer and water, that 

collectively probably the top 4,000 have a monthly relationship 

with probably, what, 95 percent of American business and households. They have a credit rating that is pretty good these days. 

They have established relationships and programs, and they work 

with subcontractors. Can you envision our being able to work, 

maybe in the next round of energy legislation that is coming, where 

we could develop partnerships where we could actually use on bill 

financing that wouldn’t require massive Federal outlays, wouldn’t 

require lots of actual approval and tax increases, but develop a 

partnership with those public and private utilities to finance deep 

green projects that would have a payback period that would be well 

within the scope of when they would pay it back, 3, 5, 10 years, 

maybe even the Federal Government and other government agencies negotiate a special rate to finance the deep green, not just energy efficiency, but it may actually be new construction or major 

reconstruction, have you given any thought to that? Does that of 

any potential, Mayors, Mr. Jones? 

Mr. PALMER. It absolutely does, and that is one of the reasons 

why we were able to work with our Public Service Electric and Gas 

to come up with the pilot program to do those kinds of things. They 

did have to go to the Board of Public Utilities to get approval of 

what they wanted to do, but certainly, I think now is the time, and 

they are willing to make those kinds of investments. 

The other thing, I just want to let you know that the U.S. Conference of Mayors and our president, Manny Diaz, wanted me to 


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let you know that the Conference of Mayors is ready to work with 

you even on the water. We have what is called the Mayors’ Water 

Council, Mayor Diaz from Albuquerque and Mayor Coody from a 

town in Arkansas or Mississippi—he is going to kill me when he 

hears I don’t—but I got his name right. But we talk about all kinds 

of issues, water, waste water, removing the volume cap for private 

activity bonds and a number of issues and that we are a great resource to help in that area and to work with you and this committee as we craft the kind of policy that will help us. 

Mr. BLUMENAUER. Before I turn to Mr. Jones for elaboration, let 

me just posit one other item, because I am not sure we should be 

afraid of actually engaging our State, public regulatory commissions. Right now many people in the inner cities are disadvantaged 

because you are subsidizing sprawl and inefficient patterns of energy, the line loss. Maybe we should be looking at having a regulatory system that rewards efficiency that is sanctioned by the 

State, sort of get into wind energy and other alternatives here, but 

it is using existing mechanisms and the market. 

Mr. NUTTER. Congressman, with your permission, just share two 

pieces of information from back home in Philadelphia. First PECO 

energy, the main energy company in Philadelphia, was a leader, is 

a leader, in green roof activity on one of their buildings in Philadelphia. One of the first green roofs for any corporation was done by 

PECO. Second, the city is working with PECO to reduce our total 

base load by 1 percent by 2011. And there is also a new State legislation in that regard. So when you raise the issue of States, States 

can absolutely have an impact here. That would result in 20 percent less electricity being used, equal to about 200,000 homes, right 

in the City of Philadelphia. So there are clear partnerships at the 

city, State and Federal level on all of these issues, and we would 

be, I would be pleased, I am sure Mayor Palmer and many others 

would be pleased to work directly with you and the Members of 

this committee and the Congress on these kinds of issues. 

Mr. BLUMENAUER. I would love to follow up with you both in 

terms of the water and the utility partnership so we are able to 

magnify the Federal legislation in part, and Mr. Markey has got all 

sorts of leadership positions, and we may be able to convince him 

to have some Federal assistance and incentives for decoupling. And 

maybe on the Ways and Means Committee, we can find a little way 

to nudge that in terms of how they are treated financially. 

Mr. Jones. 

Mr. JONES. First of all, where have you been all my life, man? 

You had me at hello with that. 

This is exactly where I think the next round is going to be. Our 

utility companies have to be partners with us at the local level to 

do the one thing we can do right now, which is to capture these 

energy cost savings and use them as a way to incent private capital. McKenzie did a study that shows that in 2 to 4 years, all the 

work we just ascribed around energy retrofits and weatherization 

can pay for itself in energy cost savings, which means essentially 

you are talking about, if you do everything the mayors just said, 

look what you just did? If you can recapture those cost savings by 

having on bill repayment like you said. If utilities companies would 

be partners with us, you get to bring up home values, bring down 


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unemployment, cut greenhouse gas emissions, clean up the air, reduce asthma, and it pays for itself. It is revenue neutral. We have 

a genius in this room named Jason Walsh, whom I want to brag 

on, and point out—who is the man blushing but Jason Walsh has 

actually taken your instinct and your insight and put together a 

proposal that would actually, for about $30 billion, let us weatherize and retrofit millions of buildings, put about 600,000 people to 

work. And because we are using revolving loan funds and loan 

guarantees, it would pay for itself. What we need is partnership 

with local utilities. 

We can unlock the value. We have a choice, as the mayors said; 

the money can go out the roof, or it can go into the pockets of workers and then become savings for homeowners and for building owners. That is the opportunity that we have here. 

Mr. PALMER. I have to leave, but this committee had me when 

they asked me to be here and my other colleagues, but thank you 

very much. The U.S. Conference of Mayors, we look forward to 

working with you. 

Mr. BLUMENAUER. I look forward to following up with you on 

these specifics. 

As you are walking out the door, one little thing, Mr. Chairman, 

before—I appreciate your indulgence, but it doesn’t like a lot of 

people waiting to elbow ahead of me. But I want a cautionary note 

just in terms of the training because some of the people we want 

to engage in this, again based on prior life as a local official and 

dealing back when we used to have training programs, CETA, 

JPTA, back—these acronyms, nobody in this room is old enough to 

remember this stuff. 

Mr. KREUTZER. Some of us are, sir. 

Mr. BLUMENAUER. But dealing with the population that we want 

to engage, I am sorry, 2 weeks isn’t enough, and I am with you 200 

percent in terms of training and engagement and using the community, working with the community colleges, working with utilities, 

working with the people in the affected neighborhoods, but we can’t 

set this up to fail. And we need to invest in particularly some of 

these young people are people who have been out of the workforce 

for some time; there is more than just learning how to slap down 

the solar panel. That is the least of it in terms of job readiness. So, 

please, make your case. I think it is right that it can be done much 

easier than people think, but we shouldn’t minimize the need to invest in the human infrastructure if we are going to be successful 

in the energy infrastructure and the new challenges. 

Mr. NUTTER. If the chairman would allow, on the Congressman’s 

point, one of the issues that I have been raising about the overall 

stimulus package has been the issue with regard, the word of the 

decade may be ‘‘infrastructure.’’ And I will just have to say this at 

least as Mayor of Philadelphia and some of the things that have 

happened in our city and many other cities across America, whether it is on the energy efficiency side, and, Congressman, I absolutely agree with you. I was trying to be responsive to Congressman Cleaver about one particular program. For some things, 2 

weeks may be enough. For some programs, 2 weeks is no where 

near enough, and there is everything in between. 


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But when we talk about infrastructure, whether it is bridges, 

roads, tunnels, underground communications, storm water, management systems, schools, and the like, specifically in the construction industry but a number of others, I would only ask for consideration that, in cities like Philadelphia, there are many people who 

have been left out and locked out of opportunities to participate, especially in the construction industry and a number of others. And 

I don’t know ultimately how you will do this, but for many of these 

job creation programs, they are certainly, I would ask that there 

might be consideration of requirements for diversity in the workforce, job training components, the opening up of apprenticeship 

programs and others. If everyone is supposed to participate in this 

economic revitalization, if we are really talking about putting 

Americans back to work, then we just can’t put the same Americans who have always had the opportunity back to work and leave 

others sitting on the sidewalk. And I would ask for that consideration as well. 

Mr. BLUMENAUER. Mr. Chairman, I appreciate your courtesy. I 

hope at some point—we spent a little time, in Portland, Oregon, we 

were the first city in the country with a comprehensive energy policy in 1979. We have got a few of these, we have had great experience working with this in the past. The Chairman indicates that 

some day we may even visit Portland to talk about some of the 

transportation, land use, and energy connections, but I really appreciate the way that you have captured it and the way the panel 

has presented an opportunity. 

And this is this has been very helpful for me Mr. Chairman. 

The CHAIRMAN. I thank the gentleman. 

And to you, Mayor Nutter, I couldn’t agree with you more. I was 

in a meeting last week with some African American Congressmen, 

and one of them, who was a little older, said his mother and father, 

said they were not happy in the South during the New Deal because the Governors of those States who were Democrats insisted 

that in most New Deal programs, there was actually a prohibition 

on African American participation in them. And it was only when 

Harry Truman’s Fair Deal came along in 1949 that there was a 

fuller inclusion. 

And I agree with you. We have to make sure that we do this in 

a way that reflects a fair deal for the 21st century in this green 

jobs area. And we thank you so much for being here, and we are 

honored to have had you here. 

Mr. NUTTER. Thank you, sir. 

The CHAIRMAN. Mr. Van, now we can have you swing back over 

to the other side of the panel, and I would like, Ms. Bode, if you 

could, to just elaborate a little more on this green job revolution as 

it is manifesting itself in the wind sector and tell us about, maybe 

you could do this Mr. Jones as well, the president of the American 

Steel Workers told me that it takes 28 tons of steel for every wind 

turbine that is built in America. That is a lot of steel workers— 

thank you, mayor. It was an honor to have you here. 

Can you talk a little about that and the jobs implications for our 

country, not just in the way people might think of it as some kind 

of a white collar, you know, Boston-San Francisco kind of oriented 


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wind industry? Who gets employed, and can you take us through 

that from beginning to end? 

Ms. BODE. Absolutely, absolutely. In fact, it is interesting that 

you ask today because tomorrow the President-elect will be visiting 

one of those facilities in Akron, Ohio, like many other facilities that 

has expanded from doing auto parts and other kinds of parts and 

equipment to adding jobs in the area of building supply chain 

equipment for wind turbines. He is going to be going to Cardinal 

Fasteners, which provides those huge long bolts that helps put 

those turbines and facilities in place and into the ground. So it is 

a very exciting opportunity, I think, for America. 

Our association had a workshop in December where they thought 

they might have 200 or 300 companies come to learn about opportunities to convert, to grow, to add new jobs in the wind area. Over 

850 companies showed up in Cleveland, Ohio, to try to see how 

they might grow and add these jobs in their area. When you talk 

about 80,000 or 90,000 jobs, it is just a down payment. It is like 

where you are just at the beginning of this new, clean jobs revolution. I mean, we are talking about half a million jobs just as a kind 

of a starting point when you start putting these in place. And as 

I said, the megawatts are growing exponentially, and it is not just 

the generation, the jobs around generation. It is about manufacturing facilities. Much of these parts were really not made in the 

U.S. initially, and now all of these new facilities are coming to the 

U.S. When you talk about the growth in energy jobs, this is where 

the growth in energy jobs, clean energy jobs in over 21 States, 65 

new manufacturing facilities have opened up. 

The CHAIRMAN. So a lot of people are talking about a nuclear 

renaissance. Right now, the nuclear industry produces 100,000 

megawatts of electricity every day. Now you are saying that the 

wind industry added 7,000 new megawatts of electricity this year. 

Ms. BODE. Second only to natural gas, which is the top. 

The CHAIRMAN. And 4 or 5 years from now, if we get the policies 

right, how many new megawatts per year do you think we could 

produce in the United States, new megawatts? 

Ms. BODE. We are talking about 20 percent of the Nation’s electricity. 

The CHAIRMAN. Do you think that could be 12 new megawatts a 

year? 

Ms. BODE. 13 gigs. 

The CHAIRMAN. What do you think is possible? 

Ms. BODE. Well, last year, we don’t have the final figures from 

last year, but we know it approached or exceeded 7,500 megawatts. 

It will be growing like that. If we get the stimulus package right, 

we hope to at least match that or get close to that if the uncertainty is not—— 

The CHAIRMAN. Five years from now—— 

Ms. BODE. Five years from now. We are going to be able—in 3 

years, we are going to meet the President’s target of doubling the 

amount of generation that we have. Over the last 3 years, we doubled it. We believe truly—— 

The CHAIRMAN. What I am trying to do is give people who are 

listening an idea, though, of the scale of what we are talking about. 

Ms. BODE. We are talking about 16 gigawatts. 


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The CHAIRMAN. Again, I am trying to keep it in one metric, and 

that metric is the nuclear industry produces 100,000 megawatts a 

year. That is 20 percent of all electricity in America. They haven’t 

built a new power plant successfully from ordering to completion 

since 1974. So there won’t be any new nuclear power plants to 

come online in the United States, even if they began today, for 

about 10 years. In 10 years, how many megawatts, for example, do 

you think that we could meet? So, today, there are 20—— 

Ms. BODE. 24,000. 

The CHAIRMAN. 24,000. You are saying that you will meet, if this 

stimulus package is put together, you will meet the President’s 

goal of doubling that in 3 years. Is that correct? 

Ms. BODE. That is right. 

The CHAIRMAN. Well that takes you to 48,000 megawatts. Again, 

the nuclear industry after 50 years produces 100,000 megawatts a 

year. So if you extrapolate that out and you go out 10 years altogether, you might be looking at 100,000 to 125,000 megawatts of 

wind in the United States before the first new nuclear power plant 

produces 1,000 new megawatts of wind. Is that correct? 

Ms. BODE. Good point, yes. 

The CHAIRMAN. Does that math work for you, or is that too ambitious for your industry? 

Ms. BODE. I don’t think that is too ambitious at all. 

The CHAIRMAN. Well, that is exciting because that is a guarantee 

of what is going to happen because there hasn’t been any new nuclear power plants for so long, and we know this is something that 

is creating new jobs. And what is the upside? How many jobs per 

year do you think you can actually create in the wind industry if 

you were producing 15,000 or 20,000 megawatts a year? 

Ms. BODE. I think what we are talking about right now is, you 

know, in the next, with this and with the renewable electricity 

standard, which we hope to have into place in the next 3 years, and 

perhaps close to 200-plus thousand jobs. 

The CHAIRMAN. By the way, this is not to say there isn’t going 

to be any new nuclear power plant generation in America. It is just 

to contrast it, so that there can be an understanding of what is 

happening already in the wind sector, and this doesn’t include solar 

or geothermal or tidal or a whole range of other renewable energy 

sources that will be creating new jobs over the next year as well. 

Mr. Jones, how would you respond to that? 

Mr. JONES. Well, first of all, that is an exciting number when you 

are talking about 200,000 jobs creating something that is going to 

deal with the greenhouse gas crisis. One of the things I think is 

very important is that we look at Detroit; we look at our so-called 

Rust Belt. Why don’t we put Detroit back to work, not making 

SUVs that are going to help destroy the world but in making these 

wind turbines? The thing about wind turbines is they are so heavy 

that it actually doesn’t make sense to make them on the other side 

of the world and bring them over here. When you are talking about 

28 tons of steel, you are talking about putting steel workers to 

work in this country, and you can put our automakers back to 

work. A wind turbine has 8,000 finely machined parts in it, 8,000. 

That is a car. You want to bail out Detroit, that is great, but let’s 

bail out the people on the planet, too. I would like to see a $15 bilVerDate Mar 15 2010 00:17 Dec 15, 2010 Jkt 062183 PO 00000 Frm 00108 Fmt 6633 Sfmt 6602 E:\HR\OC\B183.XXX B183

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lion purchase order from the U.S. Government going to General 

Motors. They are called General Motors, not General Cars, not 

General SUVs. The motors we need right now are wind turbines 

to get us the jobs of the future. 

The CHAIRMAN. They actually make automobiles in Akron, Ohio. 

Or they did. It is in jeopardy. But the president is coming with 

some good news for them—— 

Ms. BODE. Absolutely. 

The CHAIRMAN. Tomorrow that those same workers can be employed making some other technology, as Van Jones just said, that 

also requires a skill set that can help to assemble the new energy 

devices for the next century. 

Let me turn again and recognize the gentleman from Portland. 

Mr. BLUMENAUER. I wanted, Ms. Bode, to just make a request. 

I am wearing another hat here. You mentioned some of the vagaries with finance because, at this point, we need some Federal assistance with production tax credit, something that is part of how 

we have helped incent the industry and there have been all sorts 

of Federal involvement and all sorts of energy sources in times 

past, and we have made a judgment that I think is appropriate 

that we need to help get this off the ground to get to critical mass. 

And we still need to have some financial incentive; a, financial incentive, and, b, it needs to be predictable and efficient. 

I wonder if you could help us with the benefit of your team of 

members and staff to evaluate the efficiency of the production tax 

credit. How much of what we give away of Federal tax benefit actually is used by the developer to create the project? How much leakage is there because of the vagaries? Some of it is unpredictable. 

Now there are not quite as many people who can use the tax credit, 

and there is a discount; there is always some sort of discount and 

deal-making. Are you in a position to help us evaluate just how 

much of each dollar ends up in the production of wind energy? 

Ms. BODE. Well, it is interesting because, you know, the production tax credit is so interesting because it is based on the production of electricity. It is not like the investment tax credit, where 

you can build something and then get the credit without the next 

step. So, actually, that is why it was put in place, which I think 

is, again, a very important tax policy consideration. But the lion’s 

share of the money from the production tax credit in normal years 

is monetized for the use, to go into building and using for those facilities. But in the startup years, most of these companies do not— 

I mean, they are investing all their money into building this stuff, 

so they don’t have the extra revenue to utilize the tax breaks on 

it. So, in terms of the exact percentage, I can get that for you. But 

that is part of the problem now. That is why we are talking about 

asking for the refundability and the transfer ability of the issue, 

because that way, that way, you are actually able to utilize all of 

it for them without having to deal with going through the financing. 

Mr. BLUMENAUER. We have a package that, at least the last 

meeting I was at, seemed to have elements here that address those 

problems. 

So we hopefully will give you a clear window to operate going forward here for the, hopefully, the next couple of years so that we 


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can kind of sort this out. While we do that, I would appreciate your 

helping us evaluate its effectiveness; how they are able to take advantage of it; what the efficiency is in terms of the Federal outlay 

versus how much is actually utilized; how much leakage there is. 

And in part, any calibration or estimate about loss because of uncertainty, the start, stop, these would help us because we are going 

to have an energy bill, I anticipate, coming forward in the next few 

months as the administration kind of settles in, and we will be, because of the artful way that Karl Rove and Tom DeLay and Bill 

Thomas structured all the tax cuts to kind of expire, we are going 

to be revisiting the Tax Code in a, hopefully, pretty comprehensive 

way so we may be able to work with you to make sure that benefit, 

however much it should be, actually gets to you in the most efficient way. 

Ms. BODE. I very much appreciate that, and I wanted to say 

thank you to you as well because your work in terms of renewables, both wind and solar, on the Ways and Means Committee has 

been absolutely incredible. And I wanted to say thank you for the 

work on that. 

Also I wanted to mention as an old tax hand, I started off working on the Senate Finance Committee staff back in 1979, so I have 

kind of been through the whole wars on the renewable, what was 

renewable tax credit and not a production tax credit. And I was a 

State regulator for 10 years, and so we actually had to start wind 

projects in my home State of Oklahoma by putting an encouragement in rate cases. So what you do when you do not have a longterm or a permanent extension of these tax credits, whether you 

decide at some point to eliminate them or not, is you create this 

rush to build a project and then, without the certainty, then you 

have this drop off and, so you don’t have the long-term interest. 

You don’t build up the market of investors available to go in and 

to raise the capital to have this be a growing industry. And that 

is what has happened. We can chart it, every single time a tax 

credit. And that is why this is an important—short term, addressing the short-term problem in terms of the production tax credit. 

What we really need long term and mid term is to really get in 

there and address a renewable electricity standard that addresses 

the issues you were talking about, utilities, addresses the issues, 

giving people certainty, a signal from the Federal Government that 

this is the right answer. 

Mr. BLUMENAUER. And I am confident that that should and will 

be a part of the next wave in terms of having a real renewable 

portfolio standard in the legislation. 

Mr. Houser, do you have—— 

Mr. HOUSER. I can maybe provide some color on that. We analyzed this in our study, and Ms. Bode has more on-the-ground experience with the wind industry. But from a modeling standpoint, 

the Department of Energy currently predicts that, between now 

and 2014, an additional 5.9 gigawatts of wind will be built. In our 

scenario, using that model, and we extend the production tax credit 

to 2014, the additional wind capacity build is 16 gigawatts. So you 

are paying for the 5.9 gigawatts that would have happened anyway 

but there are 16 gigawatts in addition created, so—which isn’t bad 


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in terms of leakage, as you say. It is about 70 percent of the marginal increase that you get as the result of your tax credit. 

The more important question I think is what this body and the 

Senate are planning in terms of climate policy, because if our goal 

is to reduce CO2 emissions, then, as an economist, that is where 

we want to put the price is on CO2 emissions and not support specific technologies. If you put in place something like LiebermanWarner that took effect in 2013 in addition to the production tax 

credit, the amount of new wind created in our model goes up to 44 

gigawatts, but the share of that that the PTC is responsible is significantly less, and so you are double paying for the wind that you 

get both through the production tax credit and through climate policy. So I think, in thinking about the timeframe for incentives created under a stimulus package, it is important to keep climate policy in mind because, again, all the things that we are talking about 

here are only going to make the very smallest of a beginning in reducing CO2 emissions. 

The CHAIRMAN. Thank you. Thank you all. I feel a little awkward 

because I think I must adjourn the hearing, and I have to apologize. I have got 9 minutes to sprint across the Capitol, so I apologize. But I do deeply appreciate your being here. 

I have a letter that I want to enter into the record that Mr. Inslee wanted to be a part of. And we will look forward to following 

up with you individually because you have really sparked our interest and attention and look forward to continuing this work with the 

committee and maybe in some of our other committees on Budget 

and Ways and Means. I am sure we will be crossing paths. 

Ms. BODE. Well, you have given us a good to-do list, so I will follow up. 

Mr. JONES. Thank you so much. Also our colleague from Heritage 

raised some very, very important questions, especially comparing 

what is happening in Europe to what could happen here. And I 

think his point about doing what we can to lowering the cost of 

clean energy is something that we should follow up on very aggressively. 

Mr. BLUMENAUER. Thank you. Thank you all. 

Ms. BODE. Thank you very much. 

[Whereupon, at 4:10 p.m., the committee was adjourned.] 


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