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 Climate Change

Government and Policy
Published on: Feb. 14, 2020, 4:26 p.m.
A sustainable energy sector needs a sustainable workforce
  • Both skilled and unskilled workers find employment at different stages. Source: Wikipedia

By Neeraj Kuldeep. The author is Programme Associate at the Council on Energy, Environment and Water
I

ndia is undergoing an energy transition. Renewables have dominated power sector investments since 2015. India targets 175,000 megawatts (MW) of renewable energy capacity by 2022. In pursuit, it has already deployed more than 80,000 MW and about 20,000 MW of additional capacity is under construction. There have been indications that India could aim for 275,000 MW by 2027. Research from the Council on Energy, Environment and Water (CEEW) suggests that with falling technology costs, cheaper finance, and better grid integration, solar and wind power could account for up to 42 per cent of electricity generation by 2040, up from about 8 per cent today. In short, the existing targets for renewables suggest a floor, rather than a ceiling, for India’s clean energy ambitions.

The potential to create jobs has been an important factor behind the big push for renewables. Although renewable energy creates more jobs per unit of power generated than thermal power, between the promise and the reality lie several challenges. India’s energy transition promises jobs but needs a trained workforce.

India’s targets of 100,000 MW of solar power capacity and 60,000 MW of wind capacity could generate about 1.3 million direct jobs on a full-time equivalent (FTE) basis. These jobs are spread across the entire project deployment value chain.

A million FTE jobs translate into a workforce of 330,000 people because not all activities require a person to be employed throughout the year. The construction phase requires a large workforce to set-up a solar or wind power plant, when contractual workers are hired. Personnel handling business development, design and operations and maintenance (O&M) tend to be permanent employees. That said, 330,000 is a non-trivial addition to the workforce, when compared to the nearly 300,000 people employed in Coal India. As renewable energy expands, the workforce will grow further.

CEEW and the Natural Resources Defense Council conduct periodic surveys to estimate jobs in the solar and wind sectors. Their latest research points to 61,000 people employed in utility-scale solar and wind power sectors. Rooftop solar sector employs another 38,000 people.

Employment coefficients vary across renewable energy technologies. Rooftop solar creates 24.7 jobs for every MW installed, compared to only 3.45 jobs in the case of large utility-scale solar plants. Wind power creates only 1.27 jobs per MW mostly thanks to the use of prefabricated components and more mechanisation during construction.

Both skilled and unskilled workers find employment at different stages of the value chain for solar or wind. Business development requires highly skilled professionals to participate in the tendering and bidding process, legal due diligence, and contractual agreements. Design and pre-construction also need skilled technical personnel for plant design-related functions. The construction and O&M stages use a mix of semi-skilled and low-skilled workers.

Another major job creator is the decentralised renewable energy (DRE) sector. The projects are smaller in size and not concentrated in pockets of the country. As a result, more workers are needed to install and service the plants. CEEW and Power for All estimate (based on primary data collected from 37 DRE companies) that DRE provided direct employment to about 305,000 people in 2017. In addition, this sector has generated employment for another 470,000 people, by inducing jobs in communities that have gained access to electricity.

Despite the opportunities, renewables struggle to attract people to the sector. First, prospective workers encounter unclear career prospects due to fluctuating policy and investment swings within the sector. In the utility solar sector, for instance, the demand for workers grew from 4,000 people in FY15 to 29,000 people in FY18. But when the Goods and Services Tax, safeguard duties and cancelled auctions dampened enthusiasm for project developers, workforce demand also collapsed to 20,000 people in FY19. Wind projects have also experienced a slowdown, as a result of which worker demand dropped to 2,000 in FY19, 71 per cent lower than two years earlier.

Secondly, the remote location of projects makes it harder to attract skilled professionals. In order to keep tariffs low, cheaper lands are sourced but these tend to be located far from urban centres. 

Take the Bhadla solar park in Jodhpur district in Rajasthan, for instance. Located 150 kilometres from Jaisalmer and about 250 kilometres from Jodhpur, where temperatures can breach 45 degrees Celsius, with limited cellular network and scarce public transport, it is hard to find engineers who would be willing to spend a year or more in such conditions.

Thirdly, there are not enough skilled professionals in the sector. Industry representatives complain about a dearth of skilled manpower across all skill levels. There is also limited transferability of skills from other sectors that can easily be applied in renewables. For instance, existing construction workers in the real estate or infrastructure sectors cannot be smoothly shifted to specialised tasks like installation of solar modules. 

Fourthly, training programmes are not tailored to meet industry needs. Many industrial training institutes, vocational training institutes and government-supported training providers offer courses on renewables but the programmes have been found wanting. Industry insiders find that the programmes provide neither technical knowledge nor practical skills for high-precision tasks. Left with few options, renewable energy firms rely on in-house and on-the-job training to skill their staff. Moreover, the training institutions offer programmes of two- to three-months’ duration and are seldom near project sites. This imposes a cost on the trainees’ parent firms; and for many trainees from rural areas it is unaffordable to stay without income in urban centres for months on end.

In 2016, the government launched the Suryamitra programme to create 50,000 skilled manpower jobs in the solar energy sector. Again, renewable energy project developers indicate that Suryamitras do not meet industry expectations. Trainers (with only two to three years of experience) also lack the requisite skills. Consequently, many large solar companies have not recruited Suryamitras, further dampening expectations from the scheme.

Creating a trained workforce would need targeted interventions. Converting the potential for thousands of jobs into reality depends on whether prospective workers expect renewables to grow relatively faster than other infrastructure sectors. As a baseline, in order to inspire confidence, and attract more to its fold, the sector needs greater demand certainty. If India backslides on its renewable energy commitments or regulations are not well enforced, then investor confidence drops, triggering a cascade of incomplete projects and lost job options.

Alternatively, promoting distributed renewables can magnify employment opportunities. Biomass power could, alone, give jobs to 35,000 people to collect biomass as fuel, for every one GW of new generation capacity. Being primarily in rural areas, the jobs offer an extra income for households for their crop residues. Similarly, rooftop solar jobs are not limited to a particular geography but are spread across the country. If utilities piloted new business models that created additional revenue lines and new customers, they could accelerate rooftop solar deployment and create many more jobs.

There are more than four million rural micro-enterprises in India. For many, the lack of reliable electricity is the top bottleneck for business growth. Distributed renewables could, again, offer more reliable power, allowing rural enterprises to flourish. Solar irrigation pumps, solar lights, solar home systems, solar-powered sewing machines, milking machine and micro-grids are just some examples. CEEW research suggests that there is a market opportunity of more than $50 billion exists for clean energy innovations that can support the farm and non-farm rural economy. 

Shifting training centres closer to plant sites would be another useful intervention. Mobile training institutes could ensure significantly more participation. Further, the revolution in information and communications technologies now allows for workers at remote plant locations to be trained via video conference. When workers need to be re-skilled to adapt to changing technologies, they could also use cellphone applications to consume shorter training videos.

Finally, CEEW estimates that domestic manufacturing of solar photovoltaic modules and wind energy components could employ an additional to 45,000 and 10,000 people, respectively. India is also aiming for 30 per cent electric vehicle penetration by 2030. A high level of indigenisation (90 per cent of EV powertrain components manufactured domestically) could create about 40,000 jobs in four-wheel powertrain manufacturing alone. Additionally, about 165,140 jobs could be created for battery pack assembly. 

The energy transition in India (including mobility and manufacturing) offers some of the few new sources of job growth. Harnessing this opportunity needs a focus on the distributed nature of renewables, tailored and convenient training programmes, and on creating new enterprises designed around clean and reliable power supply. A sustainable energy sector needs a sustainable workforce.

*This article has been co-authored with Arunabha Ghosh, CEO, CEEW


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