Press release

8 Jun 2021 London, GB

Power and utility workforce unprepared for a decarbonized, digitized energy future

LONDON, 08 JUNE 2021. Power and utility executives foresee seismic changes in the sector over the next few years with near universal (94%) agreement among respondents on the need for direct investment in technology and the workforce, according to the new EY Power & Utilities Digital Transformation and the Workforce Survey.

Related topics Power and utilities
  • Nearly 90% of utility executives report having too few workers with the right skills to adopt digital technology
  • Utility executives strongly agree they are responding more effectively to decarbonization (36%) than digitization (22%)
  • New technology, advances in renewable energy and the response to decarbonization rank as the top three positive drivers of change for utilities over the next three years

LONDON, 08 JUNE 2021. Power and utility executives foresee seismic changes in the sector over the next few years with near universal (94%) agreement among respondents on the need for direct investment in technology and the workforce, according to the new EY Power & Utilities Digital Transformation and the Workforce Survey. In addition, nearly 90% of responding executives say that too few workers with the right skills is challenging their ability to adopt digital technologies, with many lacking a plan on how to proceed.

The EY survey of 159 power and utility executives across the globe provides unique insight into digital technology and skill adoption in the sector, as societal pressures to tackle the climate crisis mount and as the world transitions to a low-carbon energy system. According to the report, the COVID-19 pandemic has accelerated the sector’s need for large-scale transformation to decarbonize and enable electrified economies with more renewable and distributed energy — an evolution that goes hand in hand with cultivating a digitally savvy workforce.

Cyntressa Dickey, EY Global and Americas People Advisory Services — Energy & Resources Leader, says:

“The low-carbon energy transition will create new roles that require different skills, and a utility’s agility to adapt and respond to the unknown will become even more critical. The number of disruptive threats continues to rise, the number of non-traditional 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.”

New skills for a new energy world

The survey findings demonstrate the challenge faced by utilities. The digital technology landscape and the workforce skills required to support it are far beyond the core skills traditionally coveted by the sector. More than 9 of 10 respondents 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. Furthermore, more than half (55%) of respondents ranked the adoption of new technologies as one of the three trends that will have the most positive impact on their organization.

Utility executives responding to the survey estimate that nearly 60% of the workforce requires reskilling or upskilling. Yet according to current plans, only 41% of the workforce is estimated to be reskilled or upskilled as per the survey, with an average education time of 7.5 months and $4,650 in training costs per reskilled employee. Despite the growing need, respondents report that 36% of the workforce will not be reskilled or upskilled, for a variety of reasons, including competing priorities, internal challenges and market pressures.

Closing the skill gaps

Even though failure to close the skills gap and effectively implement digital technologies poses a threat to their future, utility executives provide an uneven response to how they plan to overcome the challenge. For example, while 85% of respondents said reskilling is essential to their success in the next three years, only 57% said they have a robust plan to reskill over the same period, dropping to 48% among respondents in the Americas. 

Further complicating the challenge is that respondents 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. 

Ryan Levine, Principal, Ernst & Young LLP and EY US-East Energy People Advisory Services Leader, says:

“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. 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.”



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About the survey 

The survey was conducted to measure digital technology and skill adoption in the power and utilities sector. The survey respondents consisted of 159 power and utility executives globally representing renewables, electric, natural gas, water and other types of utility companies. Respondents hold a breadth of functional roles, including IT, HR, operations, strategy and digital. The survey was conducted between January 12 and February 8, 2021.