Electrification of vehicles in Canadian mines

Trade magazine Electric Autonomy has published a series titled BEV’s in Mining, and while clearly from an industry point of view, the articles provide a useful overview of the transformation being wrought by electrification of the mining industry in Canada.  “Deep secrets: How Canada’s mining sector grabbed the global lead in mining electrification “  (Nov. 2020) introduces the topic of Battery Electric Vehicles and highlights the specific activities of mining majors GlencoreVale and Newmont, as well as Maclean Engineering, a Collingwood, Ontario-based equipment manufacturer.  A related, brief article highlighted the use of Rokion-manufactured trucks at Vale Canada mining sites in Manitoba and Ontario.  “Human capital: How BEVs in underground mining change the working environment for the better” was published in February 2021 – discussing the benefits for operators from less noise and vibration, cleaner air, and less fire risk underground. This healthier environment is linked to greater worker satisfaction and a competitive edge for employers to attract scarce talent.  The article also states that “the ventilation system for an all-electric mine will operate at roughly 50 per cent of the cost of a diesel mine and cut greenhouse emissions per mine by 70 per cent, according to government data. The Canadian government estimates transitioning to electric could save 500 tonnes of CO2 emissions per vehicle, every year.”  

Most recently,  “There’s a skills shortage maintaining electric mining vehicles. One training program is trying to fix that” ( Aug. 25), which describes the new “ Industrial Battery Electric Vehicle Maintenance Course”, associated with Cambrian College’s research-oriented Centre for Smart Mining in Sudbury, and with Maclean Engineering. What the series does not discuss are the other labour market implications – including layoffs – from the automation of vehicles and other operations.

Clean energy jobs as a transition destination

Released on June 3, Responding to Automation: Building a Cleaner Future  is a new analysis by the Conference Board of Canada, in partnership with the Future Skills Centre. It investigates the potential for clean energy jobs as a career transition destination for workers at high risk of losing their jobs because of automation. The clean energy occupations were identified from three areas: clean energy production, energy efficiency , and environmental management and the “rapid growth” jobs identified range from wind turbine technicians and power-line installers to industrial engineers, sheet metal workers, and  geospatial information scientists. Based on interviews with clean economy experts, as well as the interview responses from over five hundred workers across Canada, the analysis identifies  the structural barriers holding employers and workers back from transition:  Lack of consistent financial support for workers to reskill • Employer hesitancy to hire inexperienced workers • Current demand for relevant occupations which makes change less attractive • Lack of awareness around potential transition opportunities • Personal relocation barriers, such as high living costs in new cities, and family commitments. None of the recommended actions to overcome the barriers include a role for unions, with the burden for action falling largely on the individual employee. Only summary information is presented as a web document, but this research is part of a larger focus on automation, so it can be hoped that a fuller report will be published – if so, the partner group, Future Skills, maintains a Research website where it will likely be available.  

Other news about renewable energy jobs:

“Renewable Energy Boom Unleashes a War Over Talent for Green Jobs” appeared in Bloomberg Green News (June 8), describing shortages of skilled workers in renewable energy, mainly in the U.S.. It also summarizes a U.K. report which forecasts a large need for workers in the U.K. offshore industry, which is expected to be met by people transferring from the oil and gas sector.  

A report by the Global Wind Energy Council forecasts a growth of 3.3 million wind jobs worldwide by 2025, and suggests that offshore wind energy jobs could offer a natural transition for workers dislocated from offshore oil and gas and marine engineering workers. According to the analysis, in 2020, there were approximately 550,000 wind energy workers in China, 260,00 in Brazil, 115,000 in the US and 63,000 in India.  A related report, The Global Wind Workforce Outlook 2021-2025 forecasts a large training gap: the global wind industry will need to train over 480,000 people in the next five years to construct, install, operate and maintain the world’s growing onshore and offshore wind fleet. That report is available for download here (registration required), and is summarized in this press release.

And forthcoming:   Clean Energy Canada will release its research on the clean energy labour market in Canada on June 17.  Their last jobs report, The Fast Lane: Tracking the Energy Revolution, was released in 2019.

72% of surveyed oil and gas workers in Canada want career transition – with many willing to accept wage reduction

A survey of over 2,000 respondents from across Canada who had previously worked in the oil and gas industry found that 72% indicated that their career priority was to make a career transition. Of that 72%, “35% indicated their desired employment situation was in a different role or industry; 14% were seeking a different work arrangement such as self-employment; and 12% planned to seek employment after additional training.” The survey results are summarized in two blogs on March 30, Untapped Talent: Opportunity to Transition, and Untapped Talent, Transitioning Opportunity , from Canada’s oil and gas labour market organization, PetroLMI. The survey was conducted from October 2019 to December 2020.

While a resistance to lower wages is frequently cited as a barrier to Just Transition, the PetroLMI survey showed that: “the wage expectations of respondents were not out of line given their education, experience and skills. When asked about their salary expectations, 61% indicated a salary of less than $100,000, and 28% were willing to take a reduction in their salary for stable employment. In Alberta more than 35% of respondents said they were willing to take a salary reduction.”  42% of respondents were over the age of 55; 77% had over 15 years of experience; 86% had post-secondary education  –  in Alberta, most held a university, while in the rest of Canada, trade certification was most cited.

From the industry point of view: “While layoffs rarely have a silver lining, these workforce reductions mean there is a robust pool of talent available for hire.” “The layoffs that occurred among respondents were broad and impacted a wide range of job families and occupations from trades, truck drivers, technologists and technicians to geoscientists, engineers and information technologists. The talent pool also included occupations that tended to be transferable across industries including finance, accounting, human resources, health and safety, sales, marketing and business development. They also included field operations and drilling workers with transferable skills such as working in safety-sensitive workplaces, critical thinking and problem-solving. As a result, construction and renewable energy companies have begun hiring from this talent pool.”

Canada’s Petroleum Labour Market Institute (PetroLMI- formerly the Petroleum Human Resources Council of Canada)  produces ongoing labour market analysis, recently stating: “The cumulative impacts of a six-year economic downturn, lower demand due to COVID-19 health restrictions, and structural shifts in the oil and gas industry, mean there is a smaller oil and gas workforce in Canada – down 26%, or 58,700 jobs from its peak in 2014.” Their latest detailed labour market data, sourced from Statistics Canada, is here.  Analytical reports are compiled here,  including a four-part series titled “The Impact of COVID-19 on Canada’s Energy Workforce: A four-part series on work practices, productivity and opportunities”. On that topic, Norwegian consultancy Rystad Energy ranks Canada, U.S. and Australia as hardest hit in “Covid-19 job toll: Top O&G employer China resilient, US takes larger hit than European peers” , a March 9 newsletter.  (The Canadian Energy Research Institute also published Economic Recovery Pathways for Canada’s Energy Industry: Part 2 – Canadian Crude Oil and Natural Gas in September 2020, modelling employment and economic impacts) .

Employment and Job loss experience of Canada’s oil and gas, coal workers

In September 2020, Canada’s oil and gas industry employed approximately 160,100 workers –a 0.9% increase from August 2020, but a 14% drop from September 2019.  In that same one-year period, employment in the services sub-sector decreased by 29%;  the pipelines sub-sector decreased by  30% and the exploration and production sub-sector increased by 3%.  These statistics are based on Statistics Canada’s Labour Force Survey (LFS) data,  made available on the  Employment and Labour Force Data Dashboard provided by PetroLMI, a labour market agency specializing in the oil and gas industry, jointly funded by government-industry.  Their September 2020 blog is here, summarizing the current trends ; an archive of PetroLMI reports re the trends and forecasts is here – most recently, The LNG Opportunity in Canada: Employment Prospects and Requirements (June 2020).

In addition to providing regular labour force data by industry, on September 22 Statistics Canada released two studies in its Economic Insights series:  How Do Workers Displaced from Energy producing Sectors Fare after Job Loss? Evidence from the Oil and Gas”  Industry    and How Do Workers Displaced from Energy producing Sectors Fare after Job Loss? Evidence from coal mining. Both studies use data, (including age),  from Statistics Canada’s Longitudinal Worker File, covering the period 1995 to 2016, for  workers permanently laid off from those industries..  

Job loss experience for oil and gas workers

How Do Workers Displaced from Energy producing Sectors Fare after Job Loss? Evidence from the Oil and Gas” Industry reports that “job loss leads to substantial and persistent earnings declines”, although “three years or five years after being displaced, a significant fraction of workers displaced from this sector earn more than they did in the year prior to job loss.”  Data show that re-employment has become progressively more difficult, and for workers laid-off in 2015 or 2016, less than two-thirds found paid employment in the following year, with most moving outside the oil and gas industry – construction being the most common sector for re-employment. CBC produced a summary of the Statistics Canada report in an article here , augmenting it with personal stories and commentary from economists.

Coal workers’ job loss experience

Similar analysis (the reports are authored by the same Statistics Canada economists) appears in  How Do Workers Displaced from Energy producing Sectors Fare after Job Loss? Evidence from coal mining . Contrary to the trend for oil and gas workers, finding employment within a year of lay-off became easier for coal workers more recently: 67% for workers laid-off in 1995 compared to 89% for those laid-off in 2005 . However, regarding earnings loss, the report compares coal data with all industries, and states: “These numbers imply that about half of workers laid-off from coal mining and from other industries during the 2004-to-2011 period saw their annual wages and salaries drop by at least 30% in the short term. Since coal miners are paid higher-than-average wages …. the median declines in annual wages and salaries of coal miners displaced from 2004 to 2011 amounted to roughly $14,800 (in 2016 dollars) in the short term, more than twice the median declines (of about $6,100) experienced by other laid-off workers.” Conclusions are similar to those in the report on oil and gas workers: a  transition to “green jobs” has not materialized, and “ for many coal miners and other workers, job loss leads to substantial and persistent earnings declines”, but, “the financial consequences of job loss are not uniform for all displaced workers. …. Three years after job loss or five years after job loss, a significant fraction of displaced workers earn more than they did in the year prior to job loss.”

Just Transition proposals for Australia’s Coal Industry workers

Flag_of_Australia.svgOutside of the United States, it seems that there is general recognition that the coal industry is in decline, and that this demands a planned response to transition both the energy mix and the communities and workers.  The Institute for Sustainable Development and International Relations (IDDRI) in Paris, for example, is coordinating a Coal Transitions Project, bringing together researchers from Australia, South Africa, Germany, Poland, India and China, to publish reports examining past experiences in the six countries in March 2017, culminating with a global report and a consideration of the future of coal by 2018.

Australia’s coal production has a long and highly-political  history – summarized in  “The long-term future of Australian coal is drying up”  in The Conversation (October 2015), or “Australia’s Addiction to Coal” in the New York Times (November 14, 2016) . Amidst this highly political climate, the current government established a  Senate Inquiry into the Retirement of Coal Fired Power Stations in October 2016,  to examine “the transition from ageing, high-carbon coal generation to clean energy”  in light of the Paris Agreement commitments on emissions reductions , and the Agreement’s  provisions re just transitions. The deadline for the Inquiry’s Final Report has been extended to the end of March; an  Interim Report was released at the end of November 2016, with Chapter 4 devoted to options for managing the transition for workers and communities.   Submissions to the Senate committee are here, listed by author. Three  noteworthy examples: the Australian Psychology Association reviews the “flow-on psychosocial impacts on individuals, families and whole communities” of mass closures, but argues for the possibility of  building “vibrant, diversified, energy sustainable communities with good local jobs, and capable of lifting the prospects of all citizens”. The submission states: “Community-led transitions that identify the community’s needs and resources, involve the community in the formulation and control of change, and strengthen the local people’s capacity for action, are critically important components of planned transitions. “”  The Appalachian Transition  and Renew Appalachia are cited as models of community building.

The Australian Council of Trade Unions (ACTU) submitted a thorough, 30-page proposal:  Sharing the challenges and opportunities of a clean energy economy: Policy discussion paper. A Just Transition for coal-fired electricity sector workers and communities.  Amongst the recommendations: establish  a “national independent statutory authority”, named Energy Transition Australia (ETA), within the environment and energy portfolio, and reporting to the Minister and parliament.   The  ETA would be overseen by a tripartite advisory board comprised of industry, unions and government, with a mandate to  oversee a planned and orderly closure of Australia’s coal fired power stations;  “manage an industry-wide multi-employer pooling and redeployment scheme, where existing workers would have an opportunity to be redeployed to remaining power stations or low-emissions generators; and  develop a labour adjustment package to support workers obtain new decent and secure jobs, including by providing funding for workers to access job assistance support, retraining, early retirement and travel and relocation assistance.”

Finally, a submission by Professor John Wiseman  of the Melbourne Sustainable Society Institute lists and synthesizes many of the recommendations from recent  Just Transition publications, including   Life After Coal: Pathways to a Just and Sustainable Transition for the Latrobe Valley  (October 2016). This report by the Environment department of the province of Victoria  focuses on the four Hazelwood coal-fired power plants, scheduled to close as early as April 2017.

U.S. Fossil fuel workers need early retirement, guaranteed pensions, and clean energy futures

A Just Transition program of income and pension-fund support for workers in fossil fuel–dependent communities could be provided for approximately $500 million per year, according to the Just Transition proposals by Robert Pollin and Brian Callaci. “A Just Transition for U.S. Fossil Fuel Industry Workers” was published in American Prospect in July and re-posted to Portside on July 11. It estimates the numbers of jobs at risk in the fossil fuel industry, contrasting coal and the oil and gas industry, and assumes  that displaced workers will be re-employed in a growing clean energy industry. The Just Transition proposals focus on: Retirements at age 64 with full compensation; Guaranteed fully-funded pensions; and Community transition.  For coal workers, pension funds are managed through the United Mine Workers of America Health and Retirement Funds, which is currently underfunded by $1.8 billion. The authors call for the federal government to  bridge that gap with funding from  companies and the government. In the oil industry, the authors call on the U.S.  Pension Benefit Guaranty Corporation to use its legislated  power to prohibit the oil companies from paying dividends or financing share buybacks until the pension funds are fully funded, and to place liens on company assets if pension funds are underfunded.  Acknowledging that the decline of the fossil fuel industry, already underway, will bring hardships to entire communities, they point to past experience: the Worker and Community Transition program operated by the Department of Energy from 1994 to 2004 to cushion the impact of nuclear decommissioning. Once example from that program:  a successful economic diversification program in Nevada, which repurposed a nuclear test site to what is now a solar proving ground.  Another previous community assistance program, the Defense Reinvestment and Conversion Initiative,  is deemed less successful.  The authors conclude that a Just Transition program is eminently affordable at approximately  1 percent of the $50 billion in overall public spending needed to build a U.S. clean energy economy. And they state,  “ It is also an imperative—both a moral and strategic imperative.”

The Human Face of Displacement in the Oil, Coal Industries

A June 17  article in The Tyee, “Oil Sands Workers Fear Becoming Climate Change Casualties”   gives voice to a Unifor worker from Fort MacMurray, and his opinions about Just Transition.  Also from the Canadian oil sands, the workers’ organization  Iron and Earth has posted an online survey seeking such workers’ views;  the group  proposes a Workers Plan  with 3 main goals:   Build up Canada’s renewable energy workforce capacity; Build up Canadian manufacturing of renewable energy technologies, and  Position existing energy sector workers, developers, contractors, and unions within the renewable energy sector.  The  plight of coal workers is described  in “Alberta coal communities look at what future holds as age of coal comes to end”   in the  National Observer (June 22); so far,  the community stakes its hopes on promised “consultations”.   For  the U.S., see “As Wind Power Lifts Wyoming’s Fortunes, Coal Miners are left in the Dust”   in the New York Times (June 20), which puts a personal face on the plight of laid-off workers from the Peabody coal bankruptcy. Although a nascent wind industry is being encouraged in Wyoming, it is not forecast to replace all of the estimated 10,000 jobs to be lost in the coal industry.   And from Australia, a June paper from the Green Institute, The End of coal: How should the next government respond? states that rather than propping up the dying fossil fuel industry,.. “the most honest approach, and the one that will be best for people and the planet, is to immediately prepare for a staged transition, facilitate a dignified exit from the coal industry for workers and communities, and ensure that the corporations which have caused this mess cover the cost.” Further, the author proposes a trial of guaranteed basic income provided to coal workers in the worst affected coal areas.