Energy sector faces shortage of human capital

The world's fast-growing clean energy industry is facing a new obstacle to further expansion – a shortage of human capital, especially experienced business leaders. This is the message of a study of top-level recruitment in the clean energy sector, produced jointly by New Energy Finance, a leading clean energy investment analysis provider and Heidrick & Struggles – the international executive search firm.

The two companies conducted a survey of senior executives in the alternative and renewable energy sector to gauge the seriousness of the 'war for talent' and identify areas where recruitment difficulties are greatest.

According to Ayman Haddad, Managing Partner (Middle East and North Africa) of Heidrick & Struggles, the issue is rising in sub-sectors such as wind and solar energy and bio-fuels, as investment in specialist businesses climbs rapidly.

"While the global clean energy industry faces this serious issue, in the Middle East there is a huge opportunity, because the oil and gas sector is the principal training ground for future managers in the clean energy sector. As well as this, with this region's large population of young people, we have a huge pool of future talent, provided there is a focus on education and training to address this need. Indeed, the Middle East has the potential to be the world's talent "bread basket" in the clean energy sector," Haddad said.

New Energy Finance figures show that investment in clean energy worldwide in 2007 reached $148.4 billion (Dh545bn), up 60 per cent on the previous year. However, the central finding of the research is that business leaders regard the recruitment issue as a serious challenge, with 37 per cent of respondents saying it is "very serious" and 59 per cent describing it as "moderately serious" while only four per cent termed it "not serious".

Senior managers said finding executives to drive the growth of their businesses was a key challenge for the next 12 to 18 months, at least comparable with other concerns such as the availability of projects and assets, capital availability and cost, as well as government and regulatory support.

Another conclusion was that firms are looking hard outside their sector for top-level recruits. Just 32 per cent of respondents said most staff came with significant experience in the clean energy sector. About 48 per cent said most recruits came with experience in the traditional energy sector.

Anita Hoffmann, co-head of the alternative and renewable energy practice at Heidrick & Struggles, said: "The global need for entrepreneurial CEOs and chief technical officers with the right experience to drive these innovative clean energy companies is a senior leadership issue on a scale that threatens to hamper growth in this important industry."

Michael Liebreich, chairman and CEO of New Energy Finance, said: "This research has shown that very rapid growth in investment in clean energy is putting a strain on the availability of senior managers with experience in the sector."

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