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Green jobs economy has hits and misses in Maryland

Uneven growth may improve in future

By Timothy B. Wheeler, The Baltimore Sun

7:27 PM EDT, September 13, 2011

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Dirty, used oil promises to bring some badly needed jobs to Baltimore, one recycling company says. But energy-saving light fixtures aren't proving to be the growth business that another company thought they were — at least not yet.

FCC Environmental, a Houston-based company, recently announced plans to build a $50 million plant in Fairfield to recycle used motor oil, hiring 30 people to reclaim a waste normally burned in industrial boilers.

SavWatt USA, meanwhile, is having trouble finding enough work to expand its fledgling light-emitting-diode light assembly plant near M&T Bank Stadium. The Baltimore-based firm has 30 workers, but hoped to have 100 to 150 by year's end, according to its CEO.

Such are the vagaries of the "green" economy that government officials and some economists have long touted as the employment wave of the future.

Businesses are trying their hands at producing environmentally friendly products and services, from solar-powered lights and electric vehicle charging stations to waste recycling and pollution cleanup. But the growth in such "clean" jobs has been uneven, and hasn't matched some of the rosier projections to date — even in Maryland, where state and local officials have tried to encourage green industries.

"I don't think it's been as fast as anyone hoped for, but there's been growth," said Brad Heavner, senior policy analyst with Environment America and former state director for the environmental group in Maryland.

"Green-collar" jobs account for just 2 percent of the nation's work force and even before the recent stalling of the economy had been growing more slowly than overall employment, according to a recent report by the Brookings Institution, a Washington think tank.

The Baltimore area ranked 22nd among the 100 largest metro areas in the number of "clean" jobs, with nearly 23,000, according to the Brookings report. But those positions represent just 1.7 percent of all the jobs in the region, the report noted, a lower share than in the nation as a whole.

Clean jobs locally grew 2.6 percent annually from 2003 through last year, the report said, but that rate trailed most metro areas.

Statewide, Brookings found the number of clean jobs topped 43,000, which put Maryland 23rd among the states and the District of Columbia. But the state's clean economy also accounted for less than 2 percent of all jobs, and the growth lagged that of most states.

Mark Muro, senior fellow at Brookings and lead author of the report, said the slow growth of green jobs in Maryland is not surprising, given the sluggish national economy. A large share of the jobs classified as "green" by the Bureau of Labor Statistics and others are in the construction industry, which Muro noted has been especially hard hit by tight credit and the real estate slump.

Local economists said they think green jobs will grow in Baltimore and Maryland, in time.

"It's not a significant part [now], but I think it's something that could become a significant portion of the economy," said Raquel Frye, an economist with the Regional Economic Studies Institute at Towson University. With Congress and the Obama administration looking to cut federal funding and government employment — a bulwark of Maryland's economy for years — Frye suggested green jobs could help make up for the losses.

"We have the workforce for it, very skilled, highly trained," she said. The major question, she added, is: "What kind of investments are needed?"

At the national level, President Barack Obama's administration has pushed for development of renewable energy, more efficient cars and other elements of a green economy. But in laying out his latest jobs proposal to Congress last week, Obama didn't use the word "green" and skirted mention of energy, which has become a partisan issue. The president proposed a broad array of general employment tax breaks and public-works programs, including renovating schools and building bridges and other infrastructure

The O'Malley administration has offered incentives and tax credits to businesses creating more jobs in energy efficiency, renewable energy production, waste management and environmental cleanup or restoration. And officials say the state's green economy is larger than the Brookings report indicates.

A recent survey of employers found the state had more than 113,000 green jobs and expected to hire 13,000 more in the near future, according to Andrew Moser, president of the Maryland Workforce Corp., an entity created by the legislature to provide job training.

Moser's nonprofit received a $4 million federal grant to promote green jobs. The state also has used federal economic stimulus grants to fund work in alternative and renewable energy, and in environmental remediation.

The stimulus grants have been criticized for not producing as many jobs as officials had projected. The short-term impact of that funding was oversold, Brookings' Muro said, but he suggested that it has helped spawn new ventures.

"The innovative, clean-tech [industries] are … doing well, they are producing results, they are growing. It's just early," he said.

As an example Muro pointed to ATR, an engineering firm in Columbia that has developed robotics and other systems, with the military as a major client. With a stimulus grant, the firm has developed sun-tracking solar power units, which it's now peddling for home, business and public use.

The governor has pushed particularly hard to build industrial wind turbines off Ocean City, a huge project that supporters say could create up to 800 permanent jobs in the state.

But legislation to help finance the turbines was shelved for further study as lawmakers of both parties questioned the potential costs to ratepayers.

Del. Anthony J. O'Donnell, the House minority leader who represents Southern Maryland, said joblessness is too severe right now to pick and choose which kinds of jobs to create. "I'm more concerned about the economy of now, not the economy of the future," he said noting that BP Solar had closed its manufacturing plant in Frederick.

Some economists suggest for the near term, green jobs will remain a relatively small part of the overall employment landscape, and prospects for growth are in more modest ventures, such as making or installing solar panels, insulating homes or recycling wastes.

"I think green jobs are an important part of our future," said Anirban Basu, CEO of Sage Policy Group, a Baltimore economic consulting firm. But for now, he argued, the government needs to focus its efforts on "the most realistic jobs or technologies today."

The proposed oil-recycling plant in Fairfield may fit that description. FCC Environmental, the Texas-based subsidiary of a multinational company headquartered in Spain, plans to recycle 40 million gallons of used motor oil on the site of an old asphalt terminal operated by Chevron.

"We like to say this is green because we take a material and return it to its original form," said Vince Glorioso, vice president for FCC Environmental's existing local operations, which include collecting used oil and recycling oil filters and antifreeze.

In the United States, the vast majority of the 1.2 billion gallons of used oil collected every year winds up being burned in industrial furnaces — or dumped illegally.

The increased price of oil in recent years has provided an economic incentive for such higher-grade recycling, Glorioso said. Baltimore was chosen for the first plant because it is within a day's drive of six or seven FCC oil collection facilities in the mid-Atlantic, and because the site has ready access to interstate highways, rail lines and the water.

The asphalt terminal site was attractive due to state and local tax breaks, Glorioso said. The state is providing a $5 million tax credit, while the city is giving the firm a 10-year property tax break on the value of the facility it builds.

SavWatt USA also got tax breaks to locate its LED light assembly operation in Baltimore. But according to CEO Michael Haug, a big attraction was the city's plans to retrofit its 70,000 streetlights with energy-saving fixtures. Hoping to get a piece of that lighting makeover, SavWatt moved into a 21,000-square-foot space near the stadium in March and has hired 30 workers so far.

Ultimately, city officials project saving taxpayers $7 million annually by switching to the long-lasting and energy-efficient bulbs. But the city's initial contract earlier this year to switch 11,000 streetlights to LED stalled when Baltimore Gas and Electric Co. — which gets paid $12 million by the city to provide and maintain most of its streetlights — raised safety concerns. Spokespeople for BGE and the city say they've been in negotiations and hope to resolve the dispute soon, but the delay has cast a shadow on hiring plans for SavWatt, its CEO says.

"If we don't get projects, we can't move forward," said Haug, who had predicted last winter that the operation could create as many as 500 jobs here. He said he still hoped to have 100 to 150 employed by year's end as the company angles for business with public and private entities.

Despite slow growth and even setbacks, Brookings' Muro said he's still sure that clean technology will gain in economic importance, but it's likely to take longer than many had hoped.

"This is not going to produce multiple millions of jobs in two or three years," he said. "It might produce a million jobs over a decade."

tim.wheeler@baltsun.com

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