Memorandum submitted by Energy and Utility Skills (LCT 34)

 

Overview

We believe that skills are a key factor in delivering low carbon technologies in a green economy. However this has been an area of fragmented solutions, duplication of effort and low strategic priority. To overcome this, we have undertaken a lot of preparatory work to develop collaborative approaches because we believe they will be both more effective and will cost the country less. However it is clear to us, that this is accorded a low priority by some government departments, for whom these initiatives do not match their own priorities. Action is now needed to support this work and drive it forward to deliver against its potential.

Analysis

To be effective we need to be able to plan for new skills, develop appropriate skills solutions and be able to deliver them to the wide variety of employers, who will develop and deliver our low-carbon future.

 

This means:

1. Collaboration with Government and industry strategic policy makers to ensure that skills' planning is effective in each major technology or market initiative. This means recognising the skills dimension during planning, identifying the lead times, funding the development of skills delivery programmes during the planning stage and being willing to pump prime skills investment for 'early adopters' of new initiatives. Closer working with the economic regulators has the potential to link skills preparation work with strategic low carbon technology planning and could lead to greater collaboration on achieving greater penetration of new skills throughout the supply chains of the power companies.

2. Collaboration amongst the employer led bodies tasked with supporting employers to get the skills they need. The Renewable Energy Skills Group comprises AssetSkills, Cogent, ConstructionSkills, ECITB, EU Skills, Lantra, SEMTA and SummitSkills, who have come together to deliver this agenda. The initial focus is on research, but is expected to lead into broader collaboration on qualifications and delivery. Funding for the first research phase which will cover the whole of the UK, has been agreed in principal by DECC and is imminent, while collaborative research in Scotland is nearing completion. Further funding to ensure delivery will require the Departments responsible for funding skills and training across the 4 Nations to have policies aligned to the low-carbon agenda.

3. Developing delivery tools through collaboration on skills and qualifications. The experts believe that many of the skills needed are often to be found in a non-standard of mix of skills from a number of sources. Supporting the Renewable Energy Skills Group is a good way of getting these solutions developed.

4. Developing delivery mechanisms. These will vary from the very successful Scottish construction skills model, through the more problematic Train to Gain experience to initiatives such as the National Skills Academy for Power. Through collaboration, they have the potential to give us the tools that will deliver both new skills and innovation in their delivery. These mechanisms (and the collaboration with a significant number of Sector Skills Councils and Bodies) can provide a powerful platform for engaging with employers to focus the skills development initiatives in ways that suit their needs.

5. Developing an understanding of the importance of this agenda of skills for a low carbon economy. Our research indicates that the Power Industry has a big challenge in developing the skills it needs to deliver its existing commitments. If it can succeed, through the way it develops its National Skills Academy for Power, it will create the collaborative mechanisms that will drive new skills through their supply chain, to the 'hard to reach' smaller companies necessary to deliver the low carbon agenda. This will significantly enhance the country's skills base for the low carbon economy. (If the NSAP is not created, the demand for skills needs from the core energy sector will compete with the additional skills needed for the Low Carbon economy and the whole economy will suffer.) However delivering these initiatives is not easy. In times of increasing need arising from changing Energy policy, our attempts to increase the scope of the NSAP to support this work is facing difficulties because of the lack of funding available to the Learning and Skills Council. There is a real risk, in times of financial hardship, of not grasping the opportunities to drive change but to choose the lowest possible cost, which would establish a much weaker NSAP.

Finally many of the skills needed will be incremental, adding new capabilities to individuals with established skills. This has two implications. People who develop those incremental skills will not obtain full new qualifications and they are not eligible for Train to Gain type support. This means that many SMEs will not be 'early adopters' of new low carbon technologies. It also means that we will not be able to use one of the Government's main tools for promoting new skills (Train to Gain) to support the introduction of new low carbon technologies. The second implication is that we will need to 'backfill' the jobs of the newly up skilled people if we are not to create market strain and therefore extra costs from the introduction of new technologies. These issues need to be recognised and addressed.

6. Working with a wide range of employer size. Although many of the skills initiatives will need to work for the largest internationally owned companies, they also need to work for micro businesses. For example we need to work with the 40,000 employers (many of them sole traders) of the 120,000 people on the GasSafe register, who via gas utilisation will be key to delivering some new technologies such as smart metering and the innovative control systems that will inevitably follow. Skills policies that are able to work across the range of employers are often difficult to facilitate.

7. However in spite of these difficulties, we passionately believe that these collaborative approaches will cost less than the alternative diverse approaches that have largely been adopted so far. We also believe that it will deliver new skills more effectively to the benefit of the UK economy.

 

June 2009

Appendix

Renewable Research for the National Skills Academy for Power Business Plan

 

The challenge is considerable. In addition to the rapid expansion required in renewables, many of the roles required are only just becoming fully understood. Additionally, the traditional, thermal generation sector of the Power Sector faces its own skills challenge. With 25% of its workforce expected to retire over the next ten years companies operating in this arena will find themselves competing with renewables for recruits during this time.

The report draws on interviews with fifty five organisations; including industry, education and training, government and NGOs. Alongside a qualitative analysis of skills issues, a quantitative element shows the required workforce size for meeting 2020 targets.

The key findings include:

■      Skills shortages are already apparent, with high levels of churn and rising wages levels reported by some and most industry respondents having experienced recruitment problems.

■      Based on a 35Gw (medium growth) scenario the renewable generation sector will require 9,619 new learners by 2020.

■      In the more immature sectors e.g. marine, a lack of skills is holding back industry, and lack of industry holding back skills.

■      An acute shortage of experienced trainers in the sector.

■      Some strong links between particular educators and companies but overall links are fragmentary, with no cohesive national response. The UK's private independent educators find it difficult to get involved in training. Whereas, universities & colleges are initiating links between themselves.

■      No renewables-specific apprenticeships currently exist, which could put off many potential recruits.

■      Training infrastructure is lacking. Some international employers believed that training facilities abroad are more developed and the quality of education better.

■      The renewables sector, in contrast to the Power Sector as a whole, is highly attractive to potential employees. However, a lack of clear career paths directly into the sector is hindering attempts to exploit its attractiveness to potential recruits however.

■      Renewable skills are not new, but in some roles the mix of skills is. Multi-skilled employees are particularly important for SMEs.

■      There is a need to identify where current skills clusters are, and where future renewables sites will be located. The particular route into the sector, and the skill level involved, affects the need for local training.

Both the NSAP and EU Skills are focused on building collaboration across the range of sector bodies that have an interest in renewable energy and the associated technologies for the Power Sector.

As the labour markets for renewable energy sit across many of the established sectors covered by a range of UK Sector Skills Councils (SSC) and sector bodies a Renewable Energy Project Group has agreed a shared commitment to create a Skills Strategy to support the renewables agenda, including the Engineering Construction Industry Training Board (ECITB) and 7 other SSCs. EU Skills is currently leading the co-ordination of this Renewable Energy Skills Strategy and will use existing industry groups across the collaboration to consult on the development of this strategy.