Advanced Energy Jobs In Texas Prepared by BW Research Partnership May 2016 Table of Contents What is Advanced Energy? ............................1 About .............................................................2 Highlights .......................................................3 Introduction ....................................................5 Methodology ..................................................7 Industry Overview ............................................. 9 Segment-by-Segment Results .......................13 Energy Efficiency ......................................................... 13 Advanced Electricity Generation ................................ 15 Advanced Fuels .......................................................... 17 Advanced Transportation ........................................... 18 Advanced Grid ............................................................ 19 Market Compostition ...................................21 Value Chain ................................................................. 21 Energy Workfoce ........................................................ 21 Firm Size ..................................................................... 23 Employer Hiring Experience ....................................... 23 Customers and Vendors ...............................25 Revenue Streams ..........................................26 What is Advanced Energy? Advanced energy is a broad range of technologies, els, and nuclear power plants are all examples of products, and services that constitute the best avail- advanced energy, as they diversify energy sources, able technologies for meeting energy needs today reduce costs to communities, and use energy and tomorrow. Defined in this way, advanced energy resources more productively. For the purposes is not static but dynamic, as innovation and competi- of this report, advanced energy employment has tion produce better energy technologies, products, been divided into five industry segments: advanced and services over time. Today, demand response, electricity generation, energy efficiency, advanced natural gas-fueled trucks, high-performance build- grid, advanced transportation, and advanced fuels. ings, energy-saving industrial processes, wind tur- bines, onsite and utility-scale solar power, biofu- 1 About the Texas Advanced Energy What is Advanced Energy? Business Alliance The Texas Advanced Energy Business Alli- ance (TAEBA) includes local and national advanced energy companies seeking to make Texas’s energy system more secure, clean, reliable, and affordable. TAEBA’s mission is to raise awareness among pol- icymakers and the general public and the opportunity offered by all forms of advanced energy for cost savings, elec- tric system reliability and resiliency, and economic growth in the state of Texas. www.texasadvancedenergy.org About BW Research Partnership BW Research Partnership is a full-service research consulting firm with offices in California and Massachusetts. Recog- nized by the Congressional Research Office as developing the most accurate data to date, BW Research has conducted more clean energy labor market anal- yses than any other firm. Recent pro- jects include: The U.S. Department of Energy’s U.S. Energy and Employment Report (USEER), The Solar Foundation’s National Solar Jobs Census series, wind and solar labor market reports for the National Renewable Energy Laboratory, and clean energy reports for a variety of state agencies, trade associations, and nonprofits. www.bwresearch.com Advanced Energy Jobs in Texas 2016 Copyright 2016 Texas Advanced Energy Business Alliance 2 2016 HIGHLIGHTS Advanced Energy Jobs in Texas Advanced energy employs 143,000 workers in Texas, more than twice as many as Airlines, more than Chemical Manufacturing and Petroleum Refining, and approaching 143,023 Building Construction.1 The advanced energy industry advanced energy jobs now supports just over 1% of total statewide employment. Employers expect to add 9,334 new jobs by the end of 2016, an increase of almost 7%. This projected growth would bring total advanced energy employment in the Lone Star State to just over 152,000 workers. In 2015, there were 14,968 advanced energy compa- nies doing business in the state, the vast majority of 14,968 which support or service other local Texas businesses advanced energy companies and customers: 62% report sourcing their technolo- doing business in the state gies from in-state vendors while 74% report serving in-state customers. These firms represent more variety of industry segments and technology types than in other states with sizeable advanced energy economies, where firms tend to be more concentrated in one segment or another. While energy efficiency workers comprise just over half of the advanced energy workforce in Texas, the share is over two-thirds nationally as well as in other large advanced energy economies like California. 9,334 new jobs by the end of 2016 EmploymentEmployment byby Industry, Industry, 2015 2015 155 143 51% 100 of workers are in Energy Efficiency 60 Airlines Chemical Manufacturing Advanced Energy Building Construction & Petroleum Refining 27% of workers are in 1 BLS, Current Employment Statistics State and Area Employment, total Advanced Electricity nonfarm, Industry figures are from Q2 2015, available at: http://www.bls. Generation gov/cew/apps/table_maker/v4/table_maker.htm#type=11&year=2015& qtr=2&own=5&area=48000&supp=0. Industry definitions are available at http://www.census.gov/eos/www/naics/2012NAICS/2012_Definition_File. pdf. 3 What is Advanced Energy is All Over the Map Advanced Energy? Select Advanced Energy Projects $16 billion industry revenue in Texas $200 billion industry revenue nationwide With almost 39,000 workers, employment in Texas’s New technologies and business models Advanced Electricity Generation segment is notably are fundamentally changing the way we large. In Texas, this segment is primarily composed make, manage, and use energy. We call of wind, which continues to thrive in the state as a these technologies “advanced energy,” result of high wind resource potential, available trans- and they are driving our economy toward mission capacity, and the state’s unique competitive a prosperous future powered by secure, power system. Wind generation firms employ 45% of the Advanced Generation workforce, or about clean, reliable, and affordable energy. 17,000 workers. Solar, the next largest Advanced Electricity Generation technology, represents about three in 10 Advanced Electricity Generation workers. ADVANCED ENERGY SEGMENTS Texas is also home to a significant Advanced Fuels indus- try – about 9,500 workers in total, the majority of which are working in corn ethanol. With 13% of total advanced Advanced Electricity energy employment, Advanced Transportation is also Generation a significant segment of the state’s advanced energy economy. Advanced Transportation employs almost 19,000 workers who spend some or all of their time on hybrid, plug-in hybrid, and natural gas vehicles. Energy Efficiency As the Advanced Energy industry grows in Texas, it is also showing signs of maturing. As with most advanced energy economies, Texas has a heavy concentration (55%) of employment in installation, repair, and main- Advanced Grid tenance operations. However, there is notable employ- ment in trade, distribution, and transport (19%), engi- neering and research (18%), and manufacturing (6%), indicating that the industry as a whole is large and Advanced stable enough to support jobs in service professions Transportation as well as in project development or maintenance. Texas’s advanced energy workforce is predominantly male (78%); 43% of advanced energy workers in Advanced Fuels Texas are racial or ethnic minorities, with the share of last year’s hires significantly higher (53%). One in 10 advanced energy workers in Texas are Veterans. 4 Introduction Texas is the nation’s second largest state in both energy resources. According to the National Renewable population and land area. It is also the nation’s largest Energy Laboratory (NREL), Texas tops the nation in energy market, consuming more than any other state onshore wind potential, representing 17% of the and producing nearly twice as much electricity per nationwide total. Texas also ranks first in solar resource year as the next two largest energy producing states potential.4 In addition to wind and solar resources, the combined.2 A large and growing portion of Texas’s state ranks second in biogas potential from landfills, energy needs are being met by advanced energy wastewater treatment, and organic waste, and also has technologies. Yet no attempt to quantify employment notable geothermal resources.5 With about 449 MW of in this industry has been made—until now. installed capacity, the state ranks fourth in commercial combined heat and power (CHP), a high-efficiency Advanced Energy Jobs in Texas 2016 is the first report technology that is in widespread use in the oil refining on employment across all segments of Texas’s advanced and petrochemical industries.6 energy economy. It follows Advanced Energy in Texas, published last year, which found that advanced energy The state’s pro-business, pro-growth spirit, coupled represented a $16 billion industry in Texas.3 Advanced with supportive policies, have allowed advanced energy Energy Jobs in Texas 2016 finds that the Lone Star State businesses to transform the state’s resource potential is home to nearly 15,000 advanced energy businesses, into a booming advanced