As COP 29 is in full swing, our renewables expert Tom Jewsbury enlightens us on what we can expect from the summit, the challenges the industry is facing and gives us insight into what the future of renewables holds.
The Current Challenges of the Industry
The renewable energy industry has, for a long time, had to face several challenges related to talent acquisition, retention, and development. As the industry continues to grow, it is becoming increasingly evident that expertise around solar engineering, grid connection and energy storage, etc. is lacking to allow governments to hit their respective climate targets. It is known that all organisations are suffering from a workforce shortage, something that many are aware will not resolve itself rapidly amidst an expanding sector.
With inconsistency in policy and regulation, organisations are finding it difficult to invest in talent with a long-term mindset. Uncertainty is detrimental for attracting and retaining talent as individuals wonder if working in renewables does indeed represent a long-term career, therefore discouraging people from entering the market. The renewables industry has been tainted by the turbulent 2024, and it is not yet clear what the new normal looks like.
An answer to the skills shortage and distrust in the longevity of the sector, would be to reskill professionals currently in the Oil & Gas sector. However, it will not be as straightforward as wanted. Given the location of this year’s COP in Baku, and its links to Oil & Gas, we can hope that this skills transfer will at least form part of the conversation. Encouragingly there are some great organisations out there who are working hard to help talent make that transition – for example from the Armed Forces and Automotive sectors. This means that the talent pool has widened slightly, and this will play a vital role to keep the talent available.
Another challenge that becomes more pressing daily is the lack of skills in the digital space. As the applications for AI are identified for grid management, plenty of opportunities are set to be missed due to the lack of talent available to leverage the technological advances on offer. The challenge here is around how companies can keep up with technological progress whilst simultaneously investing in Capex heavy projects.
A pressing topic on the minds of most executives is diversity, equity and inclusion – in fact I rarely have a meeting in which it does not come up at all. It seems that organisations are acutely aware of the benefits of having a diverse workforce but are unable to effectively engage with this topic. The opportunity is there to drive a true DE&I agenda, but it is a long-term play that requires confidence, patience, and a clear vision. As mentioned above, these conditions currently appear uncommon in the renewables sector to allow businesses to successfully rethink their talent strategies.
The Topic of the Conference
“Climate Finance” is the big topic that will be discussed in Baku at COP29.
Given renewables are Capex heavy projects, this is a topic that needs to be rapidly resolved to ensure that governments and investors can invest with more confidence, and that more private finance is unlocked. With a challenging investment landscape following periods of high inflation and sustained higher interest rates, organisations have had to adapt their approach to financing.
We should also not forget that COP 29 is a global platform – i.e. there are governments from across the world who will be attending, and what works in Western Europe does not work for Sub-Saharan Africa for example. Discussing financing opportunities for countries across the world will therefore be part of the agenda. This should lead to some significant growth opportunities if a common platform can be agreed.
It is hoped that all of the above challenges will be discussed in Baku, and that both governments and the private sector can send out a clear message to unleash funds which have been pent up for the past year or so, and start tackling them head on.
Emerging trends in the renewable energy sector
With 2024 having been a year of transition due to prevailing macro-level factors, one of the big challenges for executive search firms has been to identify where the future trends lie within the industry.
On one hand, there are market segments which have seen their outlook change for the better – SMRs and Data Centres being two such examples which are intrinsically linked to the renewables industry. On the other hand, many organisations have asked themselves whether they have the right leadership in place to take to the next level once the market conditions get better. Indeed, an executive committee’s objectives today are likely to be different to those from 3-4 years ago.
Another key change: candidates need to have a stronger knowledge around regulatory frameworks and policy than previously. This is due to the fact there has been a lot of inconsistency in policy, especially across multiple geographies. That alongside the need of a wide range of technical expertise and the leadership capability to turn a vision into a reality, the talent pool gets thin. As such, finding leaders who have a proven track record of successfully adapting to these fluid situations, with the right traits for the industry, is key.
Experience and skillsets in two key areas are proving particularly valuable with hiring organisations at the moment. As supply chain issues continue to persist across the industry, experience in finding innovative and cost-effective procurement solutions is putting candidates at the front of the queue. Meanwhile, the ability to develop and execute robust digitalisation strategies is in high demand to truly comprehend the rapid advances and opportunities of AI, before taking decisive action and securing first mover benefits. Leaders who prove they can translate the AI buzz for the rest of the senior team before turning opportunities into business-wide benefits will certainly have an edge over other candidates.
Effectively adapting to an ever-changing and fluid sector, will continue to be key for executive search organisations going into next year. Our job has, this year especially, become far more consultative as a result – and we have had to be proactive in ensuring that organisations are aware of talent that fits their current reality.
With much to be explored about what is coming out of COP 29, it is certain that the renewables sector continues to be ever-changing and dynamic. Want to discuss more about how we can partner with you to find the talent to navigate this challenging industry? Request a call here.