Utility workforce unprepared for a digitized energy future


Power and utility executives foresee seismic changes in the sector over the next few years, with many agreeing they lack the proper planning on how to proceed or prepare.

The is according to the new EY Power & Utilities Digital Transformation and the Workforce Survey that shows nearly 90% of executives report having too few workers with the right skills is challenging their ability to adopt digital technologies, with many lacking a plan on how to proceed. Furthermore, the survey shows near-universal (94%) agreement on the need for direct investment in technology and the workforce.

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The EY survey of 159 power and utility executives across the globe provides insight on how executives are dealing with increased societal pressures to tackle the climate crisis, the global transition to a low-carbon energy system, and the accelerated need for large-scale transformation, especially post COVID-19. Ultimately, these challenges have created an evolution that must include cultivating a digitally savvy workforce, says EY.

“The low-carbon energy transition will create new roles that require different skills or reskilling, and a utility’s agility to adapt and respond to the unknown will become even more critical,” said Cyntressa Dickey, EY Global and Americas People Advisory Services — Energy & Resources Leader. “The number of disruptive threats continues to rise, the number of nontraditional competitors continues to grow, and technology is developing at the most rapid pace in history. Digital adoption and investment without an accompanying skilled workforce will not result in the desired benefits or returns.”

Survey findings

  • More than 9 of 10 executives said they will be changing their mix of energy sources (91%) and adapting to changing consumer expectations for a cleaner energy economy (93%) over the next few years. These changes will require new and enhanced capabilities for utilities.
  • More than half (55%) ranked the adoption of new technologies as one of the three trends that will have the most positive impact on their organization.
  • Nearly 60% of the workforce requires reskilling or upskilling, however, according to current plans, only 41% will be reskilled or upskilled, with an average education time of 7.5 months and $4,650 in training costs per reskilled employee.
  • 36% of the workforce will not be reskilled or upskilled, for a variety of reasons, including competing priorities, internal challenges, and market pressures.
  • 5% of executives said reskilling is essential to their success in the next three years, however, only 57% said they have a robust plan to reskill over the same period.

According to the survey, executives don’t necessarily know where skill gaps exist and are experiencing issues with workforce retention. One-third said they cannot measure the gap between the skills they have and what they need. Additionally, two-thirds report having difficulty retaining those with in-demand skills in their workforce.

“Utilities can be the linchpin of a decarbonized economy, if they can effectively execute a plan for digital and develop the workforce to support it,” said Ryan Levine, Principal, Ernst & Young LLP and EY US-East Energy People Advisory Services Leader. “However, failure could make them lose market share and become a prime target for disruption. Utilities will need to embrace a human-centered approach to develop a digital mindset and integrate technology across the enterprise to serve customers more efficiently.”

Study findings and illustrations can be found online.