Employment effects and renewable energy policies: applying input-output methodology to Portugal

Renewable energy is playing an increasing role in energy mixes around the world, including Europe, which is aiming for a target of 20% renewable energy by 2020. Portugal is at the forefront of the European intention, with a 31% target. The advantages of the application of renewable energy policies are widely accepted to include a decrease in greenhouse gas emissions and an improvement in energy security. In many cases job creation is also touted as a benefit but this claim stands on an uncertain footing. Amongst the variety of methodologies, analytical studies using extensive surveys seem to be more appropriate for regional studies while linear simulations, either in the form of input-output (I-O) analysis or, in recent years, social accounting matrix (SAM) multiplier analysis appear to better suit national and international studies. This paper offers an assessment of the impact of Portuguese 'green' energy policies on the employment level departing from a system of symmetric input-output tables recently built for Portugal by the Department of Foresight and Planning.