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The long-term effect of renewable electricity on employment in the United Kingdom
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Description: Assessment of the employment impact of renewable electricity technologies is generally implemented through either complex and data-intensive methods (such as Computable General Equilibrium models) or simplistic approaches, normally focused on specific energy generation technologies, such as employment factors. In contrast, this article proposes a transparent and easily reproducible econometric methodology based on the Vector Error Correction (VECM) model that uses aggregated and widely available data. We apply our approachThe model is applied to the UK power generation sector in the United Kingdom using annual data from 1990 onwards and provide evidence that the long-term employment impact of renewable technologies is much higher than the impact arising from deploying nuclear or natural gas technologies. The impulse response function analysis indicates that a permanent 1 Gigawatt-hours (GWh) increase in annual electricity supply generated by renewable technologies creates 3.5 jobs in the long-term period. Finally, we this study derives the implications of our the findings in the context of decarbonisation scenarios for the UK power sector in the United Kingdom and assesses the extent to which decarbonisation pathways based on renewable rather than nuclear technologies contribute to stimulating employment in the generation sector.