Do Renewable Portfolio Standards Create or Destroy Utility Sector Jobs? Evidence from Staggered State Adoption

Abstract

Renewable Portfolio Standards (RPS) mandate that utilities procure minimum shares of electricity from renewable sources, yet claims about their employment effects—from "green jobs bonanza" to "job-killing regulation"—rest on weak evidence. I exploit staggered RPS adoption across U.S.\ states using American Community Survey data from 2005 to 2023 to provide among the first credible causal estimates of these mandates' effects on electricity sector employment, applying heterogeneity-robust difference-in-differences estimators. Because the panel begins in 2005, the estimand reflects the average treatment effect on the treated for cohorts first treated in 2006 or later (25 states in 8 cohorts); 10 early adopters—including California, Texas, and Massachusetts—are excluded from identification. The Callaway-Sant'Anna estimate is $+0.112$ jobs per 1,000 population (SE $= 0.097$, $p = 0.251$), an economically small and statistically insignificant effect representing roughly 4.8 percent of the sample mean. The null is robust across four estimators and multiple specifications. However, important limitations qualify this finding: a joint pre-trend test rejects at $p < 0.01$ (driven by distant horizons), the binary treatment indicator masks substantial variation in RPS stringency, and the design cannot verify that RPS adoption actually increased renewable generation in the identified sample. The evidence is consistent with approximate labor reallocation within the utility sector, though attenuation bias from measurement and design limitations cannot be ruled out.