Challenges facing the energy and utilities sector

Dominic Claeys-Jackson, Editor
April, 2015

The energy industry is facing countless new challenges - meaning that attracting top graduates is a sector priority

Most key issues revolve around the 'energy trilemma' - the unenviable task of balancing security of supply and rising costs, while mitigating environmental impact. In other words, the sector is striving to ensure that energy is secure, sustainable and affordable.

Tackling this while catering for the world's growing population requires innovation, and graduates are being tasked with engineering alternative and sustainable energy sources. But as the controversy surrounding fracking shows, solutions don't just maximise availability of affordable energy - they're also environmentally responsible.

Improving customer relationships

One bi-product of the energy trilemma is consumer expectations. Lower incomes and rising levels of unemployment are sidelining climate change concerns, with many customers instead more interested in cutting their household bills and ensuring that they receive a value-for-money service.

However, improved transparency hasn't stopped protests to the Ombudsman Services from soaring and more than 30% of complaints to the Office of Gas and Electricity Markets (OFGEM) in 2014 were related to billing.

'Customers are increasingly concerned about the relationship between their energy bills and wholesale prices,' notes Andrew Falconer, director of careers and employability at GSM London, a Greenwich-based independent school of higher education. 'Smaller suppliers such as Ovo are generating interest because of its focus on customer relationships and greater transparency.'

Such scepticism is reflected in the industry's doubts about the efficiency of smart meters. Although still in the early roll-out stage and supported by the sector, some experts believe that these devices - which are aimed at changing consumer demand - may struggle to change behaviours and that the government's target will be difficult to meet.

This is despite their ability to provide users with a greater understanding of their lifestyle's impact on energy use. 'The concept of an energy company trying to encourage less consumption of their product is an anathema to customers,' concedes Andrew.

Attracting graduate talent

Many of the country's power plants and stations are being decommissioned, with the government targeting renewable sources such as wind, solar and tidal energy. Around 7,500 offshore turbines must be built over the next four or five years to meet European Union (EU) targets.

However, there's a severe lack of skilled technical individuals entering the industry. More engineers and scientists are urgently required, with research showing that the UK's construction plans will require the recruitment of around 1,000 graduate-level workers every year. Indeed, there are countless opportunities for IT, physics and engineering experts in particular.

'We are seeing people with years of experience retiring without having new talent to transfer important skills onto,' says Kate Dinwiddy, professional development team manager at the Energy Institute. 'While the take-up at universities may look positive, these numbers don't always transfer into graduates pursuing energy careers.'

According to EU Skills research, the UK's energy and utility workforce will increase by more than 200,000 people by 2023 - so being prepared for the graduate job market is essential.

Research the sector, and consider joining a professional body that provides free access to local networking events and key individuals. 'There's a wealth of information in magazines, on websites and in libraries,' adds Kate. 'It's important that students maintain their awareness of issues facing the industry.'

John Stewart, director of HR at energy company SSE, says that securing placements in different areas of the industry helps to build skills and identify areas of interest. 'Hands-on experience in the industry is very important and internships are a great way of getting real insight into the challenges that we face and the skills that are needed to tackle these challenges,' he advises.

'Exposure within an organisation helps graduates to build a strong network and provides them with practical experience of business challenges, the business environment and operational challenges.

'However, we also look for our people to develop softer skills such as leadership and decision-making, which are equally important in a large and complex organisation.'