- The COVID-19 pandemic is causing industry-wide job losses, but many storage developers are optimistic they won’t have to reduce their workforce, according to a survey conducted by the U.S. Energy Storage Association (ESA).
- The survey included 101 storage companies, including contractors, three-fourths of which did not expect they would reduce employment — despite the fact that nearly two-thirds anticipate a decrease in revenue.
- The storage-specific results are in stark contrast to estimates of the novel coronavirus pandemic’s impact on the clean energy sector. More than 106,000 workers lost their jobs in March, according to new analysis, and without legislative intervention 15% of the entire clean energy workforce could lose their jobs in the coming months.
In March, 106,472 clean energy workers — including electricians, construction workers, solar installers and wind industry engineers — filed for unemployment benefits, according to analysis released by Environmental Entrepreneurs, the American Council on Renewable Energy (ACORE), E4TheFuture and BW Research Partnership. This erased all job gains in 2019 across renewables sectors, electric vehicles, energy storage and energy efficiency.
“The renewable sector is being hit hard by supply chain disruptions, shelter-in-place orders and other significant pandemic-related delays,” Gregory Wetstone, ACORE’s president and CEO said in a press release, adding that to stem the losses, Congress would need to extend the deadlines for renewables projects to meet tax incentives.
More than 500,000 workers in the clean energy industry could be out of work in the next few months without some kind of action from Congress or the Trump administration, according to the groups.
Their report notes that a majority of the unemployment claims field in March came from leisure and hospitality workers who were affected as soon as states began to adopt shelter-in-place policies. But many states expanded those orders toward the end of the month, causing facilities that manufacture electric vehicles, batteries, solar panels, wind turbine components and other clean energy raw materials to shut down — leading to more furloughs and layoffs which are likely to be reflected in unemployment claims filed in April, according to the analysis.
In contrast, 75% of the respondents to the ESA survey for the second quarter of 2020, released Tuesday, said they did not anticipate reducing employment, including contractors. Those that did anticipate reducing their workforce think that up to 20% of employees could be let go.
Companies are looking to retain their employees so that they can prepare and respond once businesses are back up and running, the association said in a press release. However, there’s also the chance that these companies are delaying any plans to reduce their workforce until after the second quarter of the year.
At the same time, 63% of the survey’s respondents expect that their revenues will decrease — and a third expect reductions of 20% or more — because of customer delays, challenges in getting equipment and delays with permitting and approvals. These delays affected manufacturing companies more than developers and installers.
The storage sector is in a period of growth despite pandemic-related delays, Kelly Speakes-Backman, executive director of ESA, told Utility Dive. Projects are being installed for several reasons other than just supplementing renewables — for instance, as transmission alternatives or peak reduction devices — and so while that work may be delayed, it will not necessarily go away, she said.
“Our folks are doing everything they can to avoid reducing employment … I think that speaks to why most are trying to hold on, because this market will pick up again,” she said.
Humless, a developer of energy storage systems, had to hold off on some business because of stay-at-home policies that make it difficult to install systems in people’s home. But on the other hand, “we’ve definitely seen an increase in demand where a lot of people are worried about the future,” because of reliability concerns, Glenn Jakins, CEO of Humless, told Utility Dive.
While the future is uncertain, the storage industry is currently “bucking the trend a little bit” in terms of reducing workforce, he said.
“We’ve had a pretty steady flow — we’ve not had to lay off any of our manufacturing staff at all and in fact, they’re working steadily and moving product further,” he added.
However, everything boils down to sales, Jakins added. If sales were to dry up in the future, “we’ll adapt around that, but right now, we’re definitely not seeing that effect … and I think we’ll be as busy as ever,” he said.
8minute Solar Energy, which provides both solar and storage solutions, also does not plan any workforce reductions and is continuing to grow the team, spokesperson Katie Struble told Utility Dive in an email.
“8minute is in a strong financial position, having recently closed additional funding from our joint venture partners and had a profitable first quarter. We hired a storage engineer last month and have other positions open to support our growing pipeline. We’ve also started procurement for key energy storage projects,” she said.
One distinguishing feature of the energy storage industry is that it has a very tight workforce and it isn’t always easy to find experienced workers who know the sector, Jamal Burki, senior vice president of IHI Energy Storage, told Utility Dive — “unlike solar maybe, or wind, which are much more established and there’s a larger workforce.”
“I do not see us laying off anyone because our work is somewhat limited on the field,” he added.
The Long Duration Energy Storage Association of California is also optimistic. The state’s Public Utilities Commission recently identified the need for long-duration energy storage by 2026 to meet its climate goals, Executive Director Julia Prochnik said in an emailed statement, and Gov. Gavin Newsom has also been supportive.
“With continued support from state policymakers, long duration energy storage is well positioned to help California achieve its climate and reliability goals while creating new jobs and economic opportunity in regions across the state,” she said.
Original source: Utility Dive