Finding Alternate Funding For Solar Workforce Development Programs


Solar installations in the U.S. have increased dramatically in the past few years. Market projections call for continued growth, but this good news brings with it some concerns. For example, will the industry have enough trained workers to install all of those systems?

A new report co-developed by The Solar Foundation, SolarTech and the North American Board of Certified Energy Practitioners (NABCEP) suggests that the workforce may, in fact, fall short. A primary reason is that many workforce training programs and supporting organizations can expect to lose some of their existing funding sources in the coming years.Â

‘Despite the fact that jobs and skills training for the solar industry are necessary to meet this precipitous rise in demand (and for quality workmanship to become standard), funding availability for workforce training programs has not been commensurate with industry and job growth,’ the report says.

Noting that ‘hundreds of thousands’ of additional workers will be needed in order to satisfy expected solar installation demands in the next several years, the report encourages the industry to begin addressing possible training gaps and funding shortfalls immediately.

Many solar workforce training programs benefited from more than $70 million in federal, state and local funding doled out between 2009 and the present. The U.S. Department of Energy (DOE) and Department of Labor provided more than $60 million of this total, according to the report. Key programs include the Solar Instructor Training Network, run by the Interstate Renewable Energy Council.

‘However, the majority of this funding has already been, or will shortly be, exhausted,’ the report warns. ‘This funding gap suggests industry growth may not be sustainable as long as their programs remain dependent on diminishing federal, state or local public funds.’

Entry-level workforce training programs – one of the main types of programs discussed in the report – could be especially vulnerable to funding cuts. Student enrollment appears to be directly proportional to the amount of money given to the training providers.

‘Although no data yet exists to support this, if workforce development and job training funding were not available over the next several years, many solar workforce development experts believe the majority of the organizations offering this type of training would close or drastically reduce their program offerings,’ the report says. Existing funding shortfalls have already led to the shutdown or reduction of some programs.

Other types of training programs – including advanced in-service training and continuing education programs – rely more on industry funding and less on federal funding than entry-level programs. However, this financial structure does not provide immunity from budgetary problems.

The solar sector itself tends to provide the most continuing-education offerings, through equipment vendor webinars, industry conferences and other means. Such offerings are ‘largely dependent on the health of the marketplace,’ the report points out. ‘It is commonly viewed by manufacturers as a promotional or marketing activity and will be curtailed if revenues or profits decline.

Finally, ‘train the trainer’ programs, which coach existing teachers and college professors on PV-specific instruction techniques, rely entirely on government funding. These programs will probably disappear once government funding is exhausted, unless alternate sources are found.

New models
For solar and other emerging energy sectors, the workforce-training issue can become a frustrating chicken-and-egg dilemma.

‘Government support for training becomes a critical issue when the workers are needed by emerging industries,’ the report explains. ‘Companies that are struggling to bring new technologies to market do not have the financial resources to invest in workforce development; however, their very success depends on trained personnel.’

However, the wind-down of American Recovery and Reinvestment Act initiatives, as well as other federal programs that provided vital funding to solar workforce development, will necessitate alternatives. The report proposes three ideas for new funding structures that the industry – and its partners – can deploy in order to replace government funding.

The first new funding concept, a classic public-private partnership, could ‘overcome the anticipated funding shortages by providing streamlined and integrated tools to support all stages of solar career training and placement programs (program design, technical support, financing, software/hardware solutions, training/certification and program administration),’ the report explains.

Local organizations, such as Workforce Development Organizations (WDOs) or Workforce Investment Boards (WIBs) would establish a line of capital or loans for solar companies in the area, enabling the companies to support solar workforce development in their regions. Entry-level programs could expect to receive the most benefit from this arrangement.

WBOs and WIBs also play a prominent role in the report's second funding idea: revolving loan funds. Under this structure, companies looking to increase the numbers of solar workers would create a pool of capital through contracts that would collect ‘nominal fees or assessments from industry participants,’ the report explains.

The funds would be collected on a per-watt basis, under a system that would allow a PV system of 3 kW to 5 kW (i.e., the average U.S. residential project) to capitalize on the revolving loan fund for approximately $22.50 to $37.50 per installation.

In all, the loan fund could be capitalized at more than $25 million, assuming 3,300 MW of domestic PV installations and 2,624 thousand square feet of solar thermal installations in 2012 (as is projected), according to the report.

Crowd-sourcing – a well-known concept in many industries – could also work to fund solar workforce training. For this purpose, crowd-sourcing could take the form of an online exchange that allows local market participants to match their offerings to current market needs. Training would only be held once certain participation thresholds are met.

‘Arranging training sessions through an online platform provides an innovative means of efficiently allocating solar workforce training funds, assigning scarce resources to areas with the greatest demand,’ the report notes.

Overall, of the three funding concepts proposed, the report ranks evolving loan funds as the most viable, though each idea presents both advantages and disadvantages.

‘It is of critical importance that these ideas be thoroughly evaluated by the industry and other stakeholders,’ the report notes. ‘Without participation of these stakeholders, the success and sustainability of any of the programs proposed herein cannot be ensured.’

The full report – titled ‘Financing the Next Generation of Solar Workers: An Exploration of Workforce Training Program Sustainability in the Context of Reduced Public Funding’ – is available here.

Photo credit: National Renewable Energy Laboratory

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