Australia’s rush to build renewable energy fast enough to replace ageing coal-fired power stations is being fettered by the US’s own clean energy push that is luring key talent, particularly engineers, industry officials say.
America’s Inflation Reduction Act (IRA), passed just over a year ago, will pour at least US$370bn (A$570bn) into clean energy programs. Groups such as the Clean Energy Council warn the program “has the potential to permanently tilt the scales toward the US and hamper our progress in Australia”.
“In the global energy transition, the best talent will be mobile,” the council’s chief executive, Kane Thornton, said. “The success of our own energy transition relies on making the case that Australia is an attractive place to call home and our commitment to renewable energy is solid.”
Jane MacMaster, the chief engineer at Engineers Australia, said the looming skills shortage was raised by many speakers at an energy transition summit in Sydney last week.
“It’s a fantastic time to be an engineer but it’s also a very busy time,” MacMaster said. “There’s definitely a challenge in the supply of the engineering workforce at the moment, and it’s pretty much across all sectors and almost all disciplines of the profession.”
MacMaster said the IRA was drawing US engineers home as well as those from elsewhere. Several nations were considering launching countermeasures that could further challenge the appeal of working in Australia.
“Australia is competing with other countries [and] our states are competing with each other,” she said. A confluence of national priorities – from transitioning to net zero emissions, to building up sovereign manufacturing capability including for nuclear submarines – was stoking the need for engineers and other technology workers.
“We need 60,000 more graduate engineers in the next 10 years just to replace … the engineers that we think will retire”, MacMaster said. Local universities now only produce about 7,500 four-year graduates annually, many of whom get snapped up by banks or management consultancies.
The IRA’s impact on Australia’s renewables race is ill-timed. The Australian Energy Market Operator this week said 62% of the coal-fired power stations in the national electricity market were forecast to close by 2033, requiring “imminent and urgent investment” in new energy sources.
Major projects that are under way, such as the now $12bn Snowy Hydro 2.0 pumped hydro plan, have also struggled with complexity and cost overruns.
Developers such as Transgrid, which is building the now $5bn HumeLink to connect Snowy 2.0 to the main power grid, are hoping the federal government’s $20bn Rewiring the Nation plan will bolster Australia’s chances in a global race for skilled labour, material and equipment.
“Many major infrastructure projects are under way across Australia, which is squeezing limited resources,” a Transgrid spokesperson said.
“As the demand for clean energy continues to grow, the ongoing transformation of our energy system requires an urgent focus on upskilling tens of thousands of workers to address skills shortages,” he said.
Transgrid alone expects to require hundreds of electrical design, commissioning, civil and asset engineers over the next five to 10 years. The company is investing millions of dollars in training and development and partnering with Charles Sturt and Newcastle universities to help meet demand, he said.
MacMaster said her organisation detailed the issues facing the profession last year. Only about 60% of the 400,000 or so qualified engineers in Australia work in an engineering role.
Australia has long relied on importing engineers, with about 62% of those qualified born overseas. In the past five years, 82,000 of the 115,000 additional engineering jobs – or 71% – were filled by overseas talent.
MacMaster said the number of students studying intermediate or advanced maths was in steep decline while the standard of maths education was also on the skids.
Australia had also dropped from 13th in the 38-nation OECD’s program for international student assessment in 2003 to 30th by 2018, she said.
Women, too, only made up about 18% of student engineers and 14% of the qualified engineering workforce, underscoring one area of potential future growth.
Australia may also fill some of the gaps by hiring more engineering technologists, with three-year degrees, or two-year engineering associates.
“It’s a bit of a win-win situation – for those people who aren’t necessarily inclined to study as advanced levels of maths as required of professional engineers,” MacMaster said. “But we need industry to create the demand for them to incentivise more [universities] to offer these places.”
