Decentralized renewables employment data shows its potential in helping achieve both United Nations Sustainable Development Goals 7 and 8.
The Decentralized Renewable Energy (DRE) sector is a major source of stable employment with an estimated 374,000 jobs across Africa and 80,000 in India.
Demand for skilled workers in the off-grid energy sector resumes upward trajectory after pandemic dip, and it is estimated will create up to half a million jobs by 2030 in Africa alone.
The DRE sector is upskilling as it matures. According to survey respondents 71 percent of the jobs in India are skilled, 56 percent in Nigeria, and 43 percent in Kenya. Ethiopia, with a relatively underdeveloped DRE sector, has 25 percent skilled workers.
Female representation in DRE jobs remains low due to cultural and social norms, preventing many women from entering and remaining in the DRE sector. However, the wage gap is smaller than national averages, with the exception of Ethiopia.
New York, New York, U.S.A, September 19, 2022 – Power for All, the global campaign to end energy poverty, today released its second Decentralized Renewable Energy (DRE) jobs report; supported by GET.invest, Good Energies Foundation, and The Rockefeller Foundation. The industry’s most comprehensive emerging markets employment census shows increased demand for DRE solutions is creating hundreds of thousands of formal and informal jobs. The sector is becoming a major employment engine, especially in remote rural areas in emerging and developing economies where poverty and unemployment levels are high. In addition it is helping achieve universal electricity access while supporting the world’s transition to clean energy.
In order to realize the full social and economic benefits of DRE, the report calls for concerted efforts from all stakeholders in the public, private, and non-profit sectors to ensure the necessary human capital is in place.
“With DRE recovering from the impact of the pandemic faster than the broader economy its promise is clear, however significant challenges remain,” said Kristina Skierka CEO, Power for All. “Energy regulations need to be overhauled to accommodate renewables and other energy innovations, foreign investment encouraged, and structural issues like access to foreign capital and licensing restrictions resolved in order to grow DRE jobs and realize the sector’s full potential.”
According to the report, the DRE sector is a significant contributor to job creation in energy poor countries with the potential to create direct employment for up to half a million people in Africa by 2030. The sector showed great resilience in the face of COVID-19 with jobs returning in 2021 and now surpassing pre-pandemic levels in most of the study countries.
DRE–which includes pico-solar, appliances, solar home systems (SHS), commercial and industrial (C&I) standalone systems, and mini-grids–has an important role to play in accelerating United Nations Sustainable Development Goal 7 (universal access to clean reliable and affordable energy) especially in remote rural communities, and efforts towards reducing greenhouse gas emissions.
The sector has also been a source of ‘productive’ and ‘decent’ employment, especially in emerging economies where employment is a major focus of United Nations Sustainable Development Goal 8 (inclusive and sustainable economic growth, employment and decent work for all). The rapid recovery of jobs following the pandemic proves the sector’s resilience, indicating those jobs are likely immune to the worst recessionary pressures.
"Access to energy transforms every facet of life and over the past decade, technologies have been rapidly replacing fossil fuels as the most cost-effective building blocks for powering economic development," says Suman Sureshbabu, Managing Director, Demand, Jobs and Livelihoods at the Global Energy Alliance for People and Planet (GEAPP). "The Powering Jobs Reports demonstrates the green job creation potential of the vibrant DRE sector, especially for entrepreneurship and small enterprise development."
Power for All’s “Powering Jobs Census 2022: The Energy Access Workforce” report provides a comprehensive overview of employment in the DRE sector, including skill levels, training opportunities, compensation, participation of women and youth, and job retention. It is based on a survey of more than 350 companies and focus groups across five countries: Ethiopia, India, Kenya, Nigeria, and Uganda. The survey collected employment and sales data from 2019 to 2021 as well as projections for 2022 - 2023.
Highlights of the report include:
Mixed bag of blessings in job growth: From 2019 - 2021 the DRE sector created more than 80,000 direct workers in India and 144,000 across Kenya, Nigeria and Uganda and Ethiopia.
Kenya’s estimated 50,000 jobs, greatly outnumber those of Kenya Power (KPLC), the nation’s utility-scale power provider, with its 7,000 workers.
Nigeria’s estimated 50,000 jobs nearly matches the oil and gas sector, currently estimated at 65,000.
India saw a nearly 10 percent reduction in 2020 jobs due to the pandemic, though this was milder than in the overall renewable energy sector and other sectors.
Quick recovery of pandemic-related job losses: The pandemic, and other factors such as supply chain disruptions, conflict and foreign exchange (forex) shortages, contributed to the decline in direct employment in 2021.
Pandemic related job losses ranged from 1 percent in Kenya to 23 percent in Ethiopia in 2020.
Kenya, and Nigeria DRE employment saw a strong recovery reaching pre-pandemic levels in 2021.
The sector is predicted to create more than 224,000 jobs through 2023 in Nigeria, India and Kenya.
Structural challenges in Ethiopia and Uganda are expected to keep direct employment sluggish.
Persistent low participation of women: Women’s direct employment in the DRE sector recorded a slight improvement from the previous study, but still has a way to go to reach parity. The share of female participation in the sector closely mirrors the labor force of each country; highlighting the untapped ability of the DRE sector to help address female economic participation.
Women’s participation nearly doubled in Kenya and increased by 10 percent in Nigeria.
India saw a largely pandemic driven reduction of 9 percent.
On a brighter note, the gender wage gap is smaller than the national wage gap for all focus countries, with the exception of Ethiopia.
Closing the skills gaps: As the sector matures it will require an increasingly skilled workforce, training and reskilling will be critical in meeting this demand.
Many DRE companies surveyed cited critical skills gaps that need to be addressed through upskilling including sales, installation, and after-sales services.
Companies and experts interviewed identified lack of financial resources and standardized curricula as additional challenges.
Ethiopia, as a relatively immature market with considerable structural challenges, has the lowest skilled workforce with almost 75% unskilled.
The growth and resilience exhibited by DRE in this report strengthens the case for increased support from government and development partners, to not only achieve the elusive universal energy access, but to tap into its job creation potential to accelerate rural development and poverty reduction efforts. As the world continues its transition from fossil fuels into renewable energy an increasingly skilled workforce will be critical.
In addition to this global report, individual country reports will be published to provide unique insights into the DRE job and skill trends in each focus country. Visit Power for All to learn more.
About Power for All
Power for All is a global coalition campaigning to accelerate the end of energy poverty by scaling distributed renewable energy solutions. The campaign represents more than 300 business, finance, and civil society organizations focused on decentralized renewables, including household and business solar, mini-grids and productive use appliances.
Powering Jobs Census 2022: The Energy Access Workforce was made possible by GET.invest*, Good Energies Foundation, The Rockefeller Foundation, Power for All, and its #PoweringJobs partners (AMDA, AFSIA, Ashden, CEEW, CLASP, CLEAN, Clean Technology Hub Nigeria, Ethio Resource Group, GOGLA, KEREA, Shortlist, UNREEEA).
Press Release July 15, 2019. Powering Jobs Census 2019: the Energy Access Workforce
*GET.invest is a European programme that mobilises investments in renewable energy, supported by the European Union, Germany, Sweden, the Netherlands and Austria.