Expanding the clean energy workforce to fulfill IRA targets
The Inflation Reduction Act (IRA) represents a crucial turning point in the US energy policy, aiming to create a new wave of employment through extensive investments in clean energy. Aligned with the administration’s ambitious plans for an energy transformation—which includes the complete decarbonization of the grid by 2035 and the attainment of net-zero emissions by 2050—the IRA is both a symbol of America’s commitment to climate leadership and a mechanism to generate millions of new jobs. The IRA’s potential for job creation is staggering, with projections reaching up to 9 million new roles across the country within the next ten years. However, achieving these targets will necessitate a substantial expansion and enhancement of the US labor force.
Energizing the Economy through the IRA
The IRA’s strategic approach has already led to massive private sector investment, spurring $271 billion in utility-scale clean energy and $50 billion in the burgeoning electric vehicle (EV) supply chain since the legislation was enacted. However, these unprecedented projects demand a workforce skilled enough to realize them, and the signs are emerging that the demand for skilled labor might soon outstrip supply.
Labor Force Bottlenecks
An industry-wide survey found that nine out of ten US solar companies are grappling with finding skilled labor, impeding the progress of new installations. Three specific fields—builders, factory workers, and electricians—are witnessing acute labor shortages, already falling short by hundreds of thousands of workers. With an unemployment rate of 3.6 percent, new industries requiring advanced skills may face even more significant challenges.
The lack of qualified labor could set back timelines and increase costs for clean energy projects, undermining the ‘Inflation Reduction’ core of the legislation. To surmount this hurdle, policymakers must innovate ways to retain existing workers and attract younger generations to the clean energy field through comprehensive education and training initiatives.
Transitioning Workforces
The shift towards decarbonization must be just and inclusive. The current fossil fuel labor pool, comprising about 1.7 million individuals, can be a vital resource for the clean energy economy. States like California, West Virginia, and Texas have seen substantial growth in clean energy jobs, adding over 25,000 combined.
However, this transition presents unique challenges. Salary disparities between green and hydrocarbon industries, lower unionization rates in renewables, and differences in staffing requirements for wind and solar farms could obstruct this shift.
Proactive Measures for the Clean Energy Transition
To avoid potential pitfalls, concerted efforts for upskilling and economic diversification are indispensable. Engaging communities in various facets of the clean energy economy, such as manufacturing, redeveloping retired power plants, and cleaning up pollution, can be a win-win for all.
Recommendations
- Establish Public-Private Partnerships: Federal, state, and local policymakers should collaborate with clean energy providers to develop workforce academies. These partnerships can foster shared costs and ensure alignment with market needs.
- International Collaboration: Exchanging best practices with international partners, such as the European Union, can help standardize the skills needed for the energy transition.
- Streamline Visa Processes: Addressing backlogs, processes, and quotas can help draw skilled workers to the US clean energy sector. The current administration has made strides in this area, but more can be done, such as adopting systems similar to Canada’s Express Entry system.
Urgent Action Required
The clock is ticking to meet the United States decarbonization goals by 2030. A successful and timely transition requires a committed, strategic effort to grow and upskill the US labor force, recognizing the multifaceted challenges and opportunities that lie ahead.
As the nation stands on the cusp of a green revolution, the Inflation Reduction Act is not just legislation; it’s a commitment to a cleaner, sustainable, and economically robust future. Policymakers, industry leaders, educators, and communities must join hands to make this vision a reality. The path forward may be complex, but the rewards are transformative, reflecting a united drive to shape an environmentally responsible and prosperous America.
Paddy Ryan is an assistant director at the Atlantic Council Global Energy Center and the editor of EnergySource.
Maia Sparkman is an assistant director at the Atlantic Council Global Energy Center.
