Industry insiders are warning that Australia will struggle to meet the demand for both specialised and generalised skills to drive the post-Covid renewable energy transformation, especially those skills needed to develop the statesā regional Renewable Energy Zones.
With an estimated $66 billion to be invested in renewable energy over the next 10 to 15 years, and a further $27 billion in rooftop solar and battery storage, the money and the ambition for a revolution are there, yet the risk of being unable to find workers may threaten the entire ventureās viability.’
āThe wider context is that it really rings alarm bells for renewables projects,ā said Dr Chris Briggs, a research director at the UTS Institute for Sustainable Futures and author ofĀ Market Capacity for electricity generation and transmission projects.
Even now, he adds, āthere is a significant potential for shortages [of] engineers, electricians, then there are some specialised occupations like line workers which could impact more critical [projects].ā
Labor shortages can have severe consequences for projects, and particularly shortages in specialised skill-sets. Being unable to source a crane operator to lift a wind turbine could not only delay the progress of a wind farm but could lead to missed delivery dates, which could in turn incur contractual penalties.
Even before the first sod is turned at large-scale solar and wind projects, financiers will evaluate the projectās risks, including the availability of skilled workers. Projects considered too risky may never get off the ground.
Renewable energy development draws from the same labour pool as big infrastructure projects, which are set to surge in the post-Covid boom. In this broader context, demand for labour is expected to increase by 75% over the next three years, with one in three roles unfilled.
Such a spike could squeeze out renewables, warns Briggs, as āenergy is quite a small player andā¦ doesnāt pay as well as resources.ā
There is also the city/regional divide, with big infrastructure concentrated in the major cities together with the bulk of the workforce. Renewable Energy Zones, on the other hand, have always been sold as regional renewal, as much as green projects.
āDeveloping a local workforce will be a challenge for anything beyond a [fly in fly out] approach ā then you need longer term jobs, career paths and supporting infrastructure,ā said Briggs, citing a source whose experience working in a REZ has revealed not just a skills shortage, but a more generalised labour shortage.
āIt really is tough and weāre competing in a very limited labour market for people who will have a good chance of getting a job in mining or other industries ā and we need specific skills,ā says Peter Cowling, the head of the Australian arm of Danish wind giant, Vestas, which has landed some of the biggest wind farm construction projects in Australia.
Of all the skills on Cowlingās list, power systems engineers rank as the most in-demand.
āGiven any chance to talk to an electrical engineering students, I will say first, āplease do your power systems elective and if you like it you will be piled into a limousine and taken somewhere to be signed upā,ā he said.
According to Cowling, the renewable labour market is still living with the legacy of historic uncertainty.
āThe current government wanted to shut us down eight years ago ā thatās a lived memory.ā This has led to companies lacking the confidence to make long-term investments in staffing, Cowling added ā ābut thatās all past us.ā
Even now in the late-Covid lull, in an industry as established and metro-concentrated as rooftop solar, the bite the the labour force is already being felt.
Solar Runās CEO Anthony Kurta has been in the sector for 15 years and has tried recruiters but they returned with the same candidates he had found himself.
āThe industry is growing at such a rapid rate ā where are these people going to come from?ā Kurta said.
āThereās a real shortage of talent out there,ā said Richard Evans, managing director of Talent Nation, a recruitment agency that specialises in the sustainability space.
ā[Shortages are being experienced across] the full life cycle,ā he added, āfrom project development through to design construction and operations as well.ā
Skills shortages are a cost absorbed throughout the entire industry. A bidding war over candidates can inflate salaries. The entire value proposition needs to be considered, Evans says: āIt canāt be just the dollars, because someone will always offer more money.ā
Cowling says: āWe talk to recruiters, we directly advertise ourselves, we use social media and we work with a number of institutions.ā
He says universities and schools and TAFEs need to start training people quickly and Cowling has even visited schools adjacent to wind farms to try to correct this very problem.
āIāve spent some time in Mount Gambier in the school weāre working with ā there are kids you can talk to about a blue collar career, kids you can talk to about a white collar career.ā
Before Covid, one solution could be to source talent from overseas, but for the time being borders are closed. Covid has also forced a rethink on an economy reliant on overseas labour and, politically, there is a huge payoff for local jobs and āgetting Australians back to work.ā
Whatās more, green energy is a global boom, so the whole world is searching for the same skills as Australia.
Closed borders have also devastated universities and exposed a key vulnerability of a business model that relies on overseas students as a vital source of income.
A report co-authored by Victoria Universityās Dr Melinda Hildebrandt, āAustralian Investment in Higher Education,ā found that total revenue for universities had fallen by $2.4 billion, or 6%, in 2020 compared with 2019.
Whatās more, the heaviest losses have been felt in technical universities like University of NSW and RMIT. The dust is still clearing, but the situation for universities will likely get worse before it gets better, with every missed six-monthly intake of international students costing around $1-$1.2 billion.
On the VET side, electricians are the most in-demand occupation during an energy transformation. Australian Industry Groupās head of education and training, Megan Lilly, says shortages in that field reach back all the way to schools.
āYou could put more funding into the vocational system and create more places but you wouldnāt necessarily create more electricians,ā Lilly said.
āThereās a shortage of people wanting to become electrical apprentices and thereās a shortage of positions available.ā
To Lilly, the drivers here are entrenched, with universities the preferred option of parents and schools who believe professions rather than trades guarantee a better future for kids.
āSome people have gone to universities who would absolutely have been better off pursuing a vocational pathway,ā she said. ā[Schools] should create parity of esteem across both these types of learning to ensure we open broader pathways for everyone that goes through schooling.ā
Apprenticeships have become a contentious political issue heading into the next election. Federal shadow minister for skills, Richard Marles, is critical of the Morrison governmentās performance in the space.
āWe have 115,000 fewer trainees and apprentices than we did when this government came to power, and that means we donāt have people skilled up to take advantage of opportunities in booming industries,ā he said. Labor has pledged to create 10,000 New Energy Apprenticeships if it wins the upcoming federal election.
The federal minister for employment, skills and small business, Stuart Robert, claims this is little more than āarithmetic gymnasticsā and points to the governmentās own ā$2 billion JobTrainer initiativeā and the $3.9 billion Boosting Apprenticeship Commencements, which he says increased new apprenticeships by 141.5 per cent.
Yet according to the governmentās own dataĀ apprenticeship commencements have been falling steadily over the past decade and are now at their lowest since 1996-97.
Even with government support, apprenticeships are a weak segment in the training pipeline, with poor pay and ā for employers ā the ever present threat they will be poached late, giving another company the benefit of a significant staffing investment.
Ultimately, any shortage of skilled labour comes back down to responsibility ā as in, whose responsibility is it to train a workforce required to power a nation-wide energy transformation?
Before the 90s privatisation binge, huge public enterprises such as the railways and state energy commissions were seen as apprentice factories to churn out the skills for the whole country.
With the decline of our manufacturing base and the resource sectorās Dutch Disease, Australia must reverse a downward trend.
The Australia Instituteās chief economist Richard Denniss says there is a fundamental flaw in how infrastructure projects are conceived.
āWeāre pretending the real skill of infrastructure is cooking up the contracts and financing,ā Denniss said.
āWeāve got every merchant bank in the country saying āoh yes, we specialise in getting new infrastructure projects by successfully bidding to do somethingā¦ Oh weāve won the bid! Does anyone have ten thousand skills staff willing to start? Oh I thought you did!āā
Cowling agrees on this point. āOur industry is really going to be running the grid. Thereās no point in renewables saying to the rest of industry, āwell, you need to train more people.ā Thatās us now. We are the SEC [State electricity commission].ā
The problem of supply, seen from another angle, could become an opportunity beyond simply providing grist to the renewable mill. Chris Briggs argues that Renewable Energy Zones could provide good entry level jobs in solar and transmission, including pathways for indigenous and regionally unemployed workers.
Federation TAFE is working with wind industry heavies like Vestas to build an Asia Pacific Renewable Energy Training Centre (APRETC) in Ballarat.
To Cowling, the incentive for investing in APRETC is very clear: āWe can get someone qualified there who we could use elsewhere in the world ā thatās really valuable.ā
Like APRETC, Queensland has announced a Pinkenba Renewable Energy Training Facility. The ambition is not new. Investment and innovation in higher education could establish Australia as not just a renewable energy superpower, but as a global centre for skills. Yet given the current deficit in supply, this seems a long way off.
This article was originally featured onĀ Renew Economy.
