How energy efficiency programs can create jobs and unlock hidden value

How energy efficiency programs can create jobs and unlock hidden value
Jun 28, 2022

Utilities need pathways to advance community-building goals. How should energy efficiency programs play a role?

Do your energy efficiency (EE) programs have untapped potential? As the industry focuses more on decarbonization, equity, and economic development, many utility leaders are thinking more expansively about the role energy efficiency programs can play in supporting these initiatives.

The energy efficiency evolution is certainly in evidence as utilities recognize the opportunity to use these programs to build close relationships with customers while thinking more holistically about how to best deliver energy service. Looking for win-win scenarios, some have invested in clean energy workforce development programs that bring jobs to disadvantaged communities while supporting ambitious energy reduction targets.

In this article, I will take a closer look at energy efficiency workforce development programs: what’s motivating them, the elements of a successful program, and how one utility is doubling down on energy efficiency workforce development to position itself for the future.

The top-down, bottom-up push to make energy efficiency programs work harder

Why should utilities create energy efficiency workforce development programs that, while admirable, fall outside the remit of their traditional role? One reason is that investors, stakeholders, and policymakers increasingly want utilities to fulfill a broader mission that brings more benefits to society.

At the federal level, we see whole-of-government initiatives such as Justice40, which plans to deliver 40% of the overall benefits of climate investments to disadvantaged communities through partnerships between federal agencies, states, and local communities. Justice40 sends a strong signal that environmental and energy justice are key priorities for the current administration—and that recipients of federal funding need to be thoughtful stewards of these investment dollars.

The need to provide safe, reliable, and affordable energy is still a primary driver, but today’s utility leaders understand that the role of the public service companies they lead extends in several directions.

States are also making efforts to better align energy, decarbonization, affordability, and equity goals, and rolling out new approaches to support these objectives. Two examples from 2021: (1) The California Public Utilities Commission approved an expansion of energy efficiency goal setting that considers total system benefit—a way of bundling long duration GHG reductions and grid benefits into traditional program goals; and (2) Illinois passed the Climate and Equitable Jobs Act, which invests in clean energy workforce development initiatives for members of equity-focused populations.

And at the local level, there is a need for a reliable pool of trained workers who can do the work in the field. Energy efficiency programs traditionally enlist the services of a trusted network of program implementation partners and contractors. That means jobs. The need for skilled workers, combined with a heightened interest in—and demand for—equity and energy affordability, creates an opportunity for utilities to develop job training programs that focus on systemically underemployed community members.

Elements of a successful workforce development program

While every utility has a specific regulatory and business context to consider, and not all are prepared to launch a comprehensive workforce development program on day one, there are entry points at every level suited to your specific needs and priorities.

A typical workforce development program includes elements such as:

  • Job readiness screening
  • Individual plan development
  • Community asset mapping
  • Labor market analysis
  • Employer engagement
  • Capacity building
  • Economic recovery and resilience
  • Work-based learning

To ensure success, energy efficiency workforce development programs should be guided by industry experts who can teach candidates the skills they need to thrive—and support the utility’s end-to-end workforce development process, from targeted recruiting efforts to on-the-job training programs to securing hiring commitments from trade allies.

A thoughtful approach to clean energy workforce development programs will consider barriers applicants face, and work to accommodate them as much as possible. Programs that provide childcare, transportation, and other wraparound services can expand the pool of job candidates while creating economic opportunities for customers in disadvantaged communities.

One large utility’s approach to energy efficiency job creation

There is little doubt that realigning energy efficiency programs is a major undertaking for utilities, not just in planning, design, and implementation but in the work they would need to do to develop consensus with regulators and policymakers.

As a starting point, it can help to study examples from other utilities. In our new paper, we examine a case study of one utility that has gone “all in” on clean energy workforce development. PSE&G through its Clean Energy Future-Energy Efficiency Program is pursuing decarbonization, clean energy development, economic development, and workforce development in disadvantaged communities, with an emphasis on job training and job creation.

The goal of the program is to train 2,000 workers for careers in the fast-growing energy efficiency sector. To learn more about PSE&G’s workforce development program—including the progress it’s made to date, and lessons learned along the way—read “Large utility's all-in approach to clean energy workforce development yields results—and jobs."

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Meet the author
  1. Philip Mihlmester, Executive Vice President, Global Energy + ICF Climate Center Senior Fellow

    With over 45 years of experience in the energy sector, Phil is a strategic advisor to senior industry and government executives specializing in policy, regulatory, and market analysis across the energy value chain. View bio