Policy Brief

No. 06 / February 2022

Job Creation Towards

Achieving the Regional
Renewable Energy Target
Monika Merdekawati a, Beni Suryadi a, Amira Bilqis b,
Shahnaz Nur Firdausi b, Jeihan Kartika Hapsari b

Objective
To estimate the total number of renewable energy jobs needed to achieve the 2025 regional renewable energy target.

Highlights

• In total, the potential job creation reaches 1.3 million in 2025. In terms of renewable energy (RE) type, the most needed
jobs are in the field of solar (54%) power. In terms of activity, the most needed skills are related to construction (59%).
• Vietnam offers the highest potential job creations in hydro, solar and wind power. Geothermal jobs are highly needed
in Indonesia.
• More than half of ASEAN’s new RE jobs are in Vietnam (56%) and the remainder are distributed proportionally in seven
ASEAN Member States (AMS): Indonesia (10%), Myanmar (11%), the Philippines (9%), Lao PDR (4%), Malaysia (3%),
Thailand (3%) and Singapore (2%).
• ASEAN will be able to reach part of the regional RE target – the installed capacity criteria, with only a 1.5% gap to fill
before 2025. But a rigorous plan is still needed to expand the capacity of hydro by 15.7 GW and of solar power by 51.8
GW to reach the regional RE target.
• The main purpose of this discussion is to map the skill needs and allocations from two perspectives, energy type and
location.
• The recommended actions are 1) to improve the accuracy of energy jobs projection, and 2) to establish a knowledge-
sharing platform among ASEAN policymakers and develop a people-centred transition plan.

Introduction regional RE target. With the existing RE policies, the estimates

of new jobs range from 85,000 by 2025 (direct employment
Over the past decade, renewable energy (RE) has increasingly of solar and wind only) [4], to 1.7 million by 2030 (all type
taken significant role in the ASEAN energy system. Under of RE) [5]. The Net-zero Scenario by 2050 would call for a
ASEAN Plan of Action for Energy Cooperation (APAEC) Phase net increase of 9 million energy sector jobs globally [6]. The
II: 2021 - 2025, ASEAN is committed to work together to numbers underline the size of the market and the expected
achieve a 23% RE share in the total primary energy supply speed of the changes in near future.
(TPES) and a 35% share in the total installed capacity by 2025
Hence, this brief aims to examine the employment needs up
[1]. In 2020, RE deployment was 33.5% of the power capacity
to 2025 in the context of each ASEAN member state (AMS),
mix [2]. This achievement cost approximately USD 9 billion in
RE type and activity of RE project cycle. This projection is
the same year [3].
intended as a reference for policymakers in mapping which
Given the huge investments needed to realise the energy RE types and what skillsets would be most needed in their
transition, it is crucial for ASEAN policymakers to prepare respective countries.
sufficient qualified workers with the right skills to achieve the
––––––––––––––––
a Researchers of ASEAN Climate Change and Energy Project (ACCEPT), ASEAN Centre for Energy.
b Interns of ASEAN Climate Change and Energy Project (ACCEPT), ASEAN Centre for Energy.
 Policy Brief

Scope and Methodology data: employment factors (EFs), regionality factors (RFs)
and decline factors (DFs). The formulas are quite simple as
The purpose of this article is to project the direct employment summarised in Figure 1. The EFs are the number of jobs per
of solar, wind, geothermal and hydro power plants in 2025. unit of capacity that are categorised into three activities of
The term “direct” refers to the jobs in the primary industries RE project cycle, manufacturing, construction and operation
such as in manufacturing, site development, construction, and maintenance (O&M). The RFs indicate how labour-
installation and operations and maintenance. In particular, this intensive a certain region is in comparison to the OECD
analysis concerns the activities to support domestic projects averages. This factor implies the productivity data was
only and does not include cross-border job creation, for influenced by gross domestic product (GDP) per worker. The
example manufacturing is assumed to be locally produced for DFs are the reduction factors per year that are unique for
local use. This calculation is based on the capacity expansion each technology. This adjustment reflects the employment
plan from 2020 to 2025 from the power development plans per unit reduction as technologies become more efficient
(PDPs) of the ten AMS which were compiled in ASEAN Power over the years.
Updates, Edition: September 2021 [2].

The employment creation model was built in Excel by

implementing three different factors to the power capacity

Figure 1. Overview of Employment Calculations [7]

A set of assumptions were applied from a 2015 report by J. hydro and onshore wind, respectively. Second, the RFs and
Rutovitz, et.al [7] to derive the employment factors. First, DFs were linearly annualised because the report provides the
although the AMS aspire to the development of small-scale numbers for specific years only. The employment factors are
hydro and offshore wind as reflected well in the PDPs, this compiled in Table 1.
model assumes that the capacity data is for large-scale

Table 1. Employment Factors

Employment factors (EFs) Decline factors (DFs)

Construction Operation &
Technology Construction Manufacturing
times Maintenance 2020 2021 2022 2023 2024 2025
Years Job Years/ MW Jobs/ MW

Hydro 2 7.4 3.5 0.2 98% 98% 97% 97% 96% 96%

Geothermal 2 6.8 3.9 0.4 84% 81% 78% 74% 71% 68%

Solar 1 13 6.7 0.7 86% 84% 81% 78% 75% 73%

Wind 2 3.2 4.7 0.3 99% 99% 99% 98% 98% 98%

Regionality factors (RFs) 2.3 2.26 2.22 2.18 2.14 2.1

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Further, the assessment is extended to identify whether the to construction (59%), followed by manufacturing (36%)
current PDPs would be sufficient in achieving the ASEAN and O&M (5%). In terms of RE technology, the hydro, solar
RE target by comparing the capacity expansion plan of the and wind jobs dominate all activities. The relative share of
PDP vs the APAEC Target Scenario (APS) of the 6th ASEAN manufacturing vs construction jobs follows the general trend
Energy Outlook (AEO6). for most of the RE types except wind, of which manufacturing
jobs are 1.5 times of construction.
Outlook for Renewable Energy Jobs
In total, the potential job creation reaches 1.3 million. As
suggested by Figure 2, the most needed skills are related

Figure 2. Overview of Regional Renewable Energy Employment in 2025

At the country level, solar jobs are the most diversely the highest potential job creations of hydro and solar.
spread among the AMS, followed by hydro. In contrast, the Nonetheless, Figure 3 reflects the overall trend where the
geothermal and wind jobs are concentrated in a specific most needed jobs are solar (54%), hydro (24%), wind (16%)
AMS, namely Indonesia and Vietnam. Vietnam also offers and geothermal (7%).

Figure 3. Job Creations based on Renewable Energy Type in 2025

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 Policy Brief

A more detailed summary is provided in Figure 4. More than regionally. In smaller scale, Thailand has a similar mix of RE
half of ASEAN’s new RE jobs are in Vietnam (56%) with the rest employment: solar (79%) is leading, followed by wind (16%)
is distributed proportionally in seven AMS: Indonesia (10%), and hydro (6%). Another comparable case is the Philippines,
Myanmar (11%), the Philippines (9%), Lao PDR (4%), Malaysia with the minor addition of geothermal (2%). Solar (68%) jobs
(3%), Thailand (3%) and Singapore (2%). The allocation of take the lead, followed by wind (23%) and hydro (7%).
new jobs according to the type of activity is quite uniform
among the AMS. The construction jobs are in the range of In Lao PDR and Myanmar, the hydro jobs account for a
51% - 65% of job creations in the AMS. The manufacturing significant share in comparison to solar, even extending to
jobs are in the range of 30% - 38%, and the O&M jobs are in 93% in Lao PDR. By contrast, in Cambodia and Malaysia,
the range of 3% - 17%. the solar jobs are more abundant than the hydro jobs, even
reaching 95% in Malaysia. In Indonesia, the geothermal (64%)
Aligned with the regional trend, the solar jobs are the jobs are highly needed and basically represent the required
mainstream (61%) in Vietnam. While the share of wind jobs is number in all of ASEAN. In Brunei Darussalam and Singapore,
only a quarter of the RE jobs in Vietnam, it has the major share the RE employment is solely focused on solar.

Figure 4. AMS’ Renewable Energy Employment in 2025

Does this projection reflect the pathway towards the ASEAN criteria, but the same presumption may not be applicable for
RE target in 2025? The answer lies in Figure 5 where the total the TPES criteria. Hence, a rigorous plan is still needed in
installed capacity of PDP is still short 68.4 GW. However, as order to expand the capacity of hydro by 15.7 GW and solar
noted before, ASEAN actually achieved a 33.5% RE share in power by 51.8 GW to match the APS scenario. As well, the
the 2020 power capacity mix, leaving a gap of only 1.5% left contributions from most of the AMS must be intensified,
to reach the 2025 target. To conclude, ASEAN will be able following the example of Vietnam that has surpassed its
to reach part of regional RE target – the installed capacity share in the APS.

(a) PDP (b) APS

Figure 5. ASEAN’s Capacity Expansion Plan in 2025 based on PDP vs APS

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 No. 06 | February 2022

Discussion Singapore’s Environmental Services Industry Transformation

Map (ES ITM) which has administered skill advancement and
The outlook for RE jobs in this analysis may differ greatly from workforce channelling programmes since December 2017
the results published elsewhere. However, the discrepancy [9].
is actually anticipated because different studies often have
different methodologies and assumptions which are not Two concluding recommendations are 1) to improve the
clearly described. The study might adopt input-output (IO) accuracy of energy jobs projection, and 2) to establish a
or computable general equilibrium (CGE) models that can knowledge-sharing platform within ASEAN policymakers to
quantify the net job impacts from the interlinked multi- develop a people-centred transition plan. In-depth research
sectoral employment. Or, as in this exercise, the study might is essential to build a detailed historical employment data
use a simpler analytical model which can be modelled in an bank for the AMS. This would aid in understanding the hiring
Excel spreadsheet by using the employment factors that needs, skills gaps, demographics and the dynamic of energy
represent overall employment impact. businesses. In addition, a dedicated working group under the
APAEC framework is needed to examine each AMS’ existing
The employment factor often varies due to different skill sets to address the shortage of manufacturing workers
underlying approaches. Some are derived from interviews or and to maximise opportunities through regional energy
questionnaires, others from data collection of job intensities, cooperation.
or from public literatures or unpublished sources. Most
studies rarely state when or where the observation was References
conducted [8]. In addition, Rutovitz’s 2015 report stated
[1] APAEC Drafting Committee, “ASEAN Plan of Action for
several limitations. For example, he noted that the factors
Energy Cooperation (APAEC) 2016-2025 Phase II: 2021-
are only indicative in that they were not extracted from
2025,” 2020. [Online]. Available: https://aseanenergy.
quantitative data of actual surveys, and they do not consider
org/asean-plan-of-action-and-energy-cooperation-
the periodic replacement of generating plants.
apaec-phase-ii-2021-2025/.
Recommendations and the Way Forward
[2] ACE, “ASEAN Power Updates,” 2021. [Online].
This estimation is only half of the equation. The missing part Available: https://aseanenergy.org/asean-power-
is to estimate the future job losses from fossil fuel-based updates-2021/#:~:text=ASEAN Power Updates 2021
electricity. Follow up studies should be extended to consider provides,Energy Database System (AEDS).
the location of new jobs in relation to job losses because they
[3] Bain, Microsoft, and Temasek, “Southeast Asia’s Green
often occur in different places. This issue would be relevant
Economy 2021 Report: Opportunities on the Road to
for ASEAN where fossil fuels have been the backbone of most
Net Zero,” 2021. [Online]. Available: https://www.bain.
of the AMS’ energy systems. Even if the job displacement
com/globalassets/noindex/2021/green-economy/bain-
were small, it could still cause vital economic losses, and
microsoft-temasek-sea-green-economy-2021-report-
would be more pronounced in local communities. Therefore,
road-to-net-zero-main.pdf.
fair transition pathways should be embedded in the policy
planning as highlighted by the findings of Preparing Green [4] ACE, “The 6th ASEAN Energy Outlook 2017 - 2040,”
Jobs for Coal Companies’ Transition Strategies in ASEAN. 2020. [Online]. Available: https://aseanenergy.org/the-
6th-asean-energy-outlook/.
The most important result of this discussion would be a
mapping of the skill needs and allocations, so as to ease the [5] IRENA, “Global Renewables Outlook: Energy
transition of displaced workers and ramping up the supply transformation 2050,” 2020. [Online]. Available:
of new jobs. The demand for qualified workers is particularly https://www.irena.org/-/media/Files/IRENA/Agency/
important and should be met before long. The immediate Publication/2020/Apr/IRENA_Global_Renewables_
strategy should be to give the current conventional energy Outlook_2020.pdf.
workers new skills. For example, the oil and gas workers
could readily use their expertise in geothermal exploration [6] IEA, “Net Zero by 2050: A Roadmap for the Global
and construction. Likewise, coal miners and coal-fired power Energy Sector,” 2021. [Online]. Available: https://www.
plant (CFPP) developers or operators could easily transfer iea.org/reports/net-zero-by-2050.
to solar and wind energy jobs. The next step should be to
foster new talents through well-planned technical and
vocational education and training (TVET) in both professional
and academic institutions. The exemplary case in ASEAN is

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Policy Brief

[7] J. Rutovitz, E. Dominish, and J. Downes, “Calculating

global energy sector jobs: 2015 methodology,” 2015.

[8] L. Cameron and B. van der Zwaan, “Employment

factors for wind and solar energy technologies: A
literature review,” Renew. Sustain. Energy Rev., vol.
45, pp. 160–172, 2015, doi: http://dx.doi.org/10.1016/j.
rser.2015.01.001.

[9] National Energy Agency, “Environmental Services

Industry Transformation Map,” 2021. https://
www.nea.gov.sg/industr y-transformation-map/
environmental-services-industry-transformation-map
(accessed Oct. 31, 2021).

This policy brief is a product of the ASEAN Climate Change and Energy Project (ACCEPT)

ACCEPT is funded by the Norwegian Government under the Norwegian-ASEAN Regional Integration Programme (NARIP) and is jointly implemented
by the ASEAN Centre for Energy (ACE) and the Norwegian Institute of International Affairs (NUPI). The project includes the active involvement of
key ASEAN stakeholders, and helps enhance modelling, analytical and regional policy planning capacities within ASEAN.

ACE is an intergovernmental organisation within ASEAN structure that represents the 10 ASEAN Member States’ (AMS) interests in the energy
sector.

NUPI carries out research on international issues of importance to Norway and the world.

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