The Energy Transition Workforce Initiative
The energy transition underway in the United States continues to present a unique set of opportunities to put Americans back to work through the deployment of new technologies, infrastructure, energy efficiency, and expansion of the electricity system to meet our carbon goals. Unlike many previous industrial transitions, the U.S. can directly influence the pace of change, promote greater social equity, and create new jobs to replace those that are phasing out.
Since 2021, significant policies have been enacted to support this transition, including the Infrastructure Investment and Jobs Act (IIJA), CHIPS and Science Act, and the Inflation Reduction Act. The most recent Congressional Budget Office estimates of the energy-related spending of these three pieces of legislation was at least $956 billion over a 10-year period.
Despite these historic investments, additional work remains to be done. To supplement the accomplishments of the last four years, the next administration should:
- Establish the Energy Workforce and Economic Development Extension Program inside the Department of Energy (DOE).
- Restore the interagency Energy and Advanced Manufacturing Workforce Initiative.
- Initiate the Energy Transition Community Benefits Training Program.
- Establish a national public-private commission on steel decarbonization.
- Restore the DOE Labor Working Group under the direction of a senior advisor to the Secretary of Energy.
Challenge and Opportunity
In 2023, the energy sector added over 250,000 jobs, with clean energy accounting for 56% of jobs. Energy efficiency jobs, such as the manufacture and installation of heat pumps, added 74,700 jobs, the most of any technology area. While energy jobs are found in every state in America, fossil fuel production jobs and the infrastructure associated with them are highly concentrated. In 2020, 73% of the roughly one million oil, coal, and natural gas production jobs were in just 10 states. By 2023, 70,000 of those jobs were lost in the same 10 states, leaving the communities that host them at risk of economic decline. The Interagency Working Group on Coal and Power Plant Communities was established by Executive Order in 2021 to address this issue and provide new incentives for clean energy production such as the Sparkz and Form Energy battery plants in West Virginia. To date, over $538 billion of competitive and formula funding has been provided to “revitalize America’s energy communities.”
Plan of Action
On day one, the next administration should announce the expansion of the DOE Office of Energy Jobs to lead the following efforts.
Recommendation 1. Establish the Energy Workforce and Economic Development Extension Program (EWEDEP) inside the DOE.
Modeled after the Agricultural Extension Program, and in partnership with the National Laboratories, the EWEDEP should provide technical advice to the state decarbonization plans funded by the Environmental Protection Agency, as well as to municipalities, regional entities, tribal governments, and private-sector businesses. Led by the Office of Energy Jobs, this program should also assist regional, state, local, and tribal governments in developing and implementing technical decarbonization strategies that simultaneously create good local jobs. State and regional support staff for the Office of Energy Jobs should be located in each of the national laboratories.
Recommendation 2. Restore the interagency Energy and Advanced Manufacturing Workforce Initiative (EAMWI).
During the Obama Administration, EAMWI, run by the Department of Energy, coordinated activities between the Departments of Energy, Labor, Education, Commerce, and Defense and the National Science Foundation to harmonize planning, training, and curriculum development for the new energy workforce. In addition to resuming those coordinative activities, the next administration should mandate that the EAMWI produce quarterly assessments of the needs and opportunities in workforce training in response to the requirements of the energy transition. Based on updated USEER data from 2024 and ongoing job occupational needs’ assessments, EAMWI should provide annual reports on state energy workforce needs to the appropriate federal and state agencies in charge of energy, education, and economic development strategies.
Recommendation 3. Initiate the Energy Transition Community Benefits Training Program.
Community Benefit Plans (CBPs) and Community Benefit Agreements (CBAs) have emerged as the primary tools for monitoring job quality metrics in the energy transition, particularly those that are supported by federal government grants and loans. This program should provide expert training in the design and performance of CBPs and CBAs for company executives, community organizations and advocates, labor unions, and local government employees. This program should be informed by an advisory board of experts from business schools, trade associations, labor unions, and community stakeholders.
Recommendation 4. Establish a national public-private commission on steel decarbonization.
Decarbonizing the steel industry will be one of the most difficult and expensive challenges posed on the energy transition. Appointing a national commission of industry stakeholders, including business, labor, communities, and federal agencies, will be critical for developing a model for managing hard-to-decarbonize, industrial sectors of the economy in ways that create quality jobs, protect communities, and build broad consensus among the American people. DOE should also establish an Office of Steel Decarbonization to implement the commission’s recommendations.
Recommendation 5. Restore the DOE Labor Working Group under the direction of a senior advisor to the Secretary of Energy.
The DOE Labor Working Group provided monthly guidance on how to implement high wage strategies in the energy sector while preserving jobs and reducing greenhouse gas emissions. Member organizations included energy sector unions involved in the mining, extraction, manufacturing, construction, utility, and transportation industry sectors.
After initiating these actions on day one, the next administration should prioritize legislation establishing an Energy Transition Adjustment Assistance Program (ETAAP). In some cases, the loss of fossil fuel jobs in concentrated parts of the country will require retraining of current employees to prepare them for new careers with new employers. The U.S. will need a program to provide income support greater than extended unemployment to recipients undergoing retraining. Such a program should learn from the shortcomings of the Trade Adjustment Assistance (TAA) program by providing more supportive services. Based on two-year training costs and average participation rates of TAA-certified beneficiaries, a minimum of $20 billion for worker retraining should be allocated as part of this effort.
In addition, the Interagency Working Group on Coal and Power Plant Communities should be consulted to design standards for broad eligibility to participate in the ETAAP, including energy-intensive manufacturing businesses impacted by the energy transition. Finally, as existing energy companies transition to producing cleaner forms of energy, the program should consider subsidizing the retraining of existing energy-sector employees to provide new skills for the transition.
Conclusion
Unlike many previous industrial transitions, which were driven by new technologies and market forces, decarbonization is driven largely by social policy interventions. Thus, well-planned responses, based on timely clean-energy economic development investments, can provide good jobs and economic opportunity for displaced workers and affected communities. The clean energy tax credits included in the IRA should be maintained and extended. Labor standards and domestic content rules should be attached to both grants and formula spending. Finally, the lending authorities for the DOE Loan Program Office should be expanded to include energy infrastructure, energy-intensive manufacturing, and energy efficiency projects. With such an approach, the U.S. and its workers can benefit from the global push to decarbonize.
This idea was originally published on February 1, 2021. We’ve republished this updated version on November 27, 2024.
This action-ready policy memo is part of Day One 2025 — our effort to bring forward bold policy ideas, grounded in science and evidence, that can tackle the country’s biggest challenges and bring us closer to the prosperous, equitable and safe future that we all hope for whoever takes office in 2025 and beyond.
PLEASE NOTE (February 2025): Since publication several government websites have been taken offline. We apologize for any broken links to once accessible public data.
The main challenge is providing a timely economic development response to impacted communities before the most serious job losses have occurred. Our goal is to create a Federal Emergency Management Agency (FEMA)-like response in advance of the economic storm devastating some communities because of the loss of fossil fuel jobs. However, unlike FEMA, most federal economic development programs are not designed to respond to emergency job loss, and they require annual appropriations and lengthy preparations.
The overall success of the Energy Transition Workforce Initiative will be measured by the number and quality of jobs created in the communities expected to be hardest hit by the energy transition, the timeliness of the intervention, and the stability of the communities. Utilization rates of EWEDEP technical support for regions, state, local and tribal governments to develop implementation plans will also be a primary measure.
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