Emerging Power and Utilities Workforce Challenges and How to Overcome Them
Originally published in the August 2024 Workforce Edition of the Northwest Public Power Association monthly bulletin.
The power and utilities industry is undergoing a significant shift towards renewable and sustainable energy sources—such as wind, hydro, electric, solar, and nuclear—due to global, economical, and regulatory demands.
This shift requires a workforce with new skills, capabilities, and experience to advance the effort towards cleaner and greener sources of power as well as being adaptable and innovative.
Having insight into the industry’s current workforce concerns and emerging challenges can improve decision-making, inform hiring practices, and help you build an agile, future-focused team.
Current Workforce Concerns
One of the most significant trends in the industry is the growing focus on integrating renewable energy sources into the grid, which requires workers with expertise in renewable energy technologies and grid management.
For example, the rise of distributed energy resources (DERs), like rooftop solar and battery storage, requires new workforce skills for managing decentralized networks and integrating them into the main grid.
There’s also an increased focus on customer experience and personalized services, with utilities employing more customer service representatives and investing in customer relationship management systems (CRM) to meet customer-centric service demands.
Finally, a significant portion of the current workforce is nearing retirement age, creating an intellectual property and experience gap, increasing the need for actionable succession planning and knowledge transfer to the younger talent.
Emerging Workforce Challenges
Sourcing effective talent is an ongoing business struggle across industries, especially with the ongoing talent shortage. Below are workforce hurdles specific to the power and utilities industry.
Attracting and Retaining Talent
As power and utility organization transitions towards renewable and sustainable energy sources, one of the most significant challenges is the talent shortage. Many organizations have predominantly focused on recruiting talent within the industry. Historically, this has been adequate, however, it’s not meeting current needs.
As the emphasis to move towards skills-based hiring gains momentum, many organizations are expanding their recruiting networks to candidates with diverse backgrounds and skills—like science, technology, engineering, and mathematics—from other industries.
While the power and utility profession remain strong and growing, organizations are experiencing a higher-than-normal number of voluntary workforce turnovers. A significant number can be directly tied to retirement, but others are leaving in search for better opportunities, career progression, flexible working, and work life balance.
Shifting Regulatory Requirements
Navigating complex and evolving regulatory environments at local, state, and federal levels is an ongoing industry challenge. Meeting compliance requirements while maintaining operational efficiency and cost-effectiveness is crucial.
Having a workforce with the skills to navigate shifting compliance and regulatory changes is essential to meeting the necessary requirements and reducing risk.
Decarbonization Targets
Achieving sustainability and decarbonization targets set by governments and international agreements involves significant changes in operations, technology adoption, and workforce planning. Utilities must focus on decarbonization goals while maintaining grid stability and meeting increasing demand for clean energy.
Going forward, the power and utilities industry is expected to leverage artificial intelligence (AI) and digital solutions to enhance grid resilience and operational efficiency. This will require a significant investment in new talent and talent development to meet these objectives.
Cyber and Grid Security
The increasing cyber threat to critical infrastructure is requiring enhanced security measures, increasing the demand for cybersecurity experts, and causing organizations to invest in robust security protocols.
Climate change also poses significant challenges, with extreme weather events affecting grid reliability and operations. The need to invest in workers with the advanced knowledge and skills to manage the infrastructure, digital and monitoring systems used in these high-level events is an increasing trend. Utilities must also invest in resilience measures and sustainable practices to mitigate these impacts.
The rapid adoption of new technologies and the shift towards renewable energy require upskilling the existing workforce and attracting new talent proficient in these areas.
Artificial Intelligence
AI is expected to address industry challenges such as grid reliability, predictive maintenance, and resource planning. Digital twins, which are virtual models of physical assets, are being employed to improve grid control and anticipate infrastructure challenges. Employing workers with advanced technology skills is becoming a common need.
Innovations such as blockchain for secure transactions and GIS for accurate utility mapping are being integrated into the sector, enhancing transparency, efficiency, and asset management. Immersive technologies like virtual reality (VR) and augmented reality (AR) are being used for training and maintenance, improving worker safety and operational effectiveness which also necessitates the need for a technology-savvy workforce.
How to Mitigate Workforce Challenges
Overcome workforce challenges with the following protocols.
- Conduct strategic planning sessions and assess the organization to understand its short-, mid-, and long-term talent needs.
- Evaluate the current workforce and develop a capabilities matrix to define the skills, capabilities, education, certification, and experience that exist in the organization.
- Develop an actionable workforce strategy resulting in new or modernizing existing programs to support in the acquisition, engagement, and retention of talent—such as career pathing, development, mobility, total rewards, tuition reimbursement, diversity, equity and inclusion—to support the talent needs.
- Review past organizational trends associated with hiring, engagement, productivity, turnover, diversity, aging workforce, and define internal risks to overcome.
Plan for the Future
Implement an organization-wide workforce planning team to effectively plan for current and future needs, with a focus on:
- Build. Investing in the training and development of the current workforce to build skills and capabilities based on current gaps or future needs.
- Buy. Acquiring external talent with the required skills when the specialized skills don’t exist within the company or is too costly and time-consuming to develop in-house.
- Borrow. Leverage temporary, contract, freelance, or gig workers to support a current role, or bring a specialized skill for a limited time.
- Bind. Leverage compensation, incentives, and other rewards to retain employees’ either full-time, part-time, or as an independent contractor. Put in practice forecasting, predictive modeling, and scenario planning to proactively plan for and implement strategies.
We’re Here to Help
To learn more about how your organization can identify and overcome workforce challenges, contact your Moss Adams professional.