[Senate Hearing 110-288]
[From the U.S. Government Printing Office]


                                                        S. Hrg. 110-288
 
                        DOMESTIC ENERGY INDUSTRY 

=======================================================================

                                HEARING

                               before the

                              COMMITTEE ON
                      ENERGY AND NATURAL RESOURCES
                          UNITED STATES SENATE

                       ONE HUNDRED TENTH CONGRESS

                             FIRST SESSION

                                   TO

  RECEIVE TESTIMONY ON WHETHER DOMESTIC ENERGY INDUSTRY WILL HAVE THE 
                   WORKFORCE--CRAFTS AND PROFESSIONAL

                               __________

                            NOVEMBER 6, 2007


                       Printed for the use of the
               Committee on Energy and Natural Resources

                     U.S. GOVERNMENT PRINTING OFFICE

40-735 PDF                 WASHINGTON DC:  2008
---------------------------------------------------------------------
For sale by the Superintendent of Documents, U.S. Government Printing
Office  Internet: bookstore.gpo.gov Phone: toll free (866)512-1800
DC area (202)512-1800  Fax: (202) 512-2250 Mail Stop SSOP, 
Washington, DC 20402-0001


































               COMMITTEE ON ENERGY AND NATURAL RESOURCES

                  JEFF BINGAMAN, New Mexico, Chairman

DANIEL K. AKAKA, Hawaii              PETE V. DOMENICI, New Mexico
BYRON L. DORGAN, North Dakota        LARRY E. CRAIG, Idaho
RON WYDEN, Oregon                    LISA MURKOWSKI, Alaska
TIM JOHNSON, South Dakota            RICHARD BURR, North Carolina
MARY L. LANDRIEU, Louisiana          JIM DeMINT, South Carolina
MARIA CANTWELL, Washington           BOB CORKER, Tennessee
KEN SALAZAR, Colorado                JOHN BARRASSO, Wyoming
ROBERT MENENDEZ, New Jersey          JEFF SESSIONS, Alabama
BLANCHE L. LINCOLN, Arkansas         GORDON H. SMITH, Oregon
BERNARD SANDERS, Vermont             JIM BUNNING, Kentucky
JON TESTER, Montana                  MEL MARTINEZ, Florida

                    Robert M. Simon, Staff Director
                      Sam E. Fowler, Chief Counsel
              Frank Macchiarola, Republican Staff Director
             Judith K. Pensabene, Republican Chief Counsel





























                            C O N T E N T S

                              ----------                              

                               STATEMENTS

                                                                   Page

Berrigan, Carol, Nuclear Energy Institute........................    54
Bingaman, Hon. Jeff, U.S. Senator From New Mexico................     1
Bowers, Paul, Southern Company, Atlanta, GA......................    43
Corker, Hon. Bob, U.S. Senator From Tennessee....................     4
Cornelius, Andra, Workforce Florida, Inc., Tallahassee, FL.......    16
Derocco, Emily, Assistant Secretary, Department of Labor.........     4
Domenici, Hon. Pete, U.S. Senator From New Mexico................     2
Hoffman, Patricia, Deputy Director, Department of Energy.........    10
Hunter, Jim, International Brotherhood of Electrical Workers.....    60
Stults, Ray, National Renewable Energy Laboratory, Golden, CO....    50
Szydlowski, Norm, Colonial Pipeline, Alpharetta, GA..............    39

                               APPENDIXES
                               Appendix I

Responses to additional questions................................    73

                              Appendix II

Additional material submitted for the record.....................    93


                        DOMESTIC ENERGY INDUSTRY





                              ----------                              


                       TUESDAY, NOVEMBER 6, 2007

                                       U.S. Senate,
                 Committee on Energy and Natural Resources,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 9:59 a.m. in room 
SD-366, Dirksen Senate Office Building, Hon. Jeff Bingaman, 
chairman of the committee, presiding.

OPENING STATEMENT OF HON. JEFF BINGAMAN, U.S. SENATOR FROM NEW 
                             MEXICO

    The Chairman. OK, let me call the hearing to order. This is 
a hearing on the U.S. energy workforce. I'd like to thank all 
of the witnesses for coming today, we have two distinguished 
panels. Some came from out of town, and I know they have very 
busy schedules, so we appreciate them being here.
    Let me just mention a couple of statistics. The Energy 
Information Administration's annual energy outlook projects 
that energy use in the United States is going to increase by 31 
percent over the next 25 years. That will result in a very 
substantial increase in generating capacity for electricity in 
the country. EIA projects an addition of 4,761 miles of new 
natural gas pipeline, up by 50 percent from the 2007 projection 
that they had earlier come out with.
    At any rate, these large increases in the projections by 
the Energy Information Administration indicate the Nation will 
require a trained workforce on hand to design and build this 
future energy generation, whether that's from fossil fuels, 
from nuclear power, from renewable sources, and the purpose of 
this hearing is to understand what policies we should be 
supporting and putting in place to help with the development of 
that workforce and avoid a workforce shortage in this critical 
period.
    So, I very much appreciate folks being here, and let me 
defer to Senator Domenici for his comments.
    [The prepared statement of Senator Bingaman follows:]

  Prepared Statement of Hon. Jeff Bingaman, Chairman, From New Mexico
    Let me call today's hearing on the U.S. Energy Workforce to order. 
First, I would like thank all the witnesses for coming today, many of 
you came from out of town with very busy schedules in order to testify 
to the full committee.
    Today's hearing addresses whether our existing and future 
workforce--both skilled and professional are capable of supplying the 
nation's energy needs.
    Let me highlight a few statistics on our growing energy need.
    The Energy Information Agency's Annual Energy Outlook 2007 projects 
that energy use in the U.S. is expected to increase by 31 percent over 
the next 25 years.
    To help meet this increase in energy use the U.S. generating 
capacity is projected to increase by 199 GW of which 258 GW are from 
new generating units--or roughly 258 1000 MW plants.
    For 2008, the EIA projects an addition of 4761 miles of new natural 
gas pipeline, up by 50 percent from the 2007 projection of 3195 miles.
    These large increases indicate that the nation will require a 
trained workforce on hand to design and build the future energy 
generation whether it is from fossil, nuclear or renewable sources.
    The Department of Labor estimates that the energy industry employs 
well over 1 million people and accounts for 4 percent of the Gross 
Domestic Product. However, the average age of energy industry workers 
is now over 50 with 500,000 expected to retire over the next 5 to10 
years--a turnover rate of 50 percent. The impact of this energy 
workforce turnover is projected to be largest in the utilities--which 
employ over half of the current energy workforce.
    We have assembled before this committee today representatives from 
the federal government, state government and industry to help this 
committee learn about what the workforce issues are and what we in the 
Congress can do to help address what appears to be a looming workforce 
shortage.
    Again, let me thank everyone for coming today and I look forward to 
the testimony.

   STATEMENT OF HON. PETE V. DOMENICI, U.S. SENATOR FROM NEW 
                             MEXICO

    Senator Domenici. Thank you, Senator Bingaman, Mr. 
Chairman. Actually, this is one of the most important and 
exciting meetings that we're going to have regarding America's 
ability to solve our energy problems in the future.
    It's obvious to me that many of our companies are ready to 
make investments to use innovative technology to build new 
things. It's obvious that nuclear power is, once again, 
exciting. Those who are thinking about using it, obviously, 
have to think about borrowing money, for the most part, a lot 
of money. They also have to find out whether they can build on 
some reasonable schedule.
    All of the energy production has to worry about schedules, 
because they borrow money based on schedules, they build their 
business based on schedules. Frankly, many of them are going to 
have a very difficult time finding the employees that they 
expect to be available for major kinds of production 
facilities, be it a nuclear power plant, or any other kind of, 
let's say offshore drilling rigs with everything that goes with 
it. It's obvious that they're going to have trouble finding the 
equipment, and now we come to what we're talking about, having 
difficulty finding the trained people on the highest level, 
called engineers, and operational engineers, all the way 
through welding, even if these jobs pay well. The question is, 
who wants them? Who will take them? Where do we have them? 
Certainly, we can start the hearing knowing that we don't have 
enough of them on hand. It's not like we can just move them 
from one place to another, there just aren't enough 
electricians around for three or four nuclear power plants. 
You're going to have to find a way, business and America, are 
going to find ways to train these electricians, these welders, 
these engineers, and that's what the hearing is about, how are 
we going to do it?
    I, myself, am interested in what industry thinks is the 
answer to how we're going to do it. I was telling Senator 
Bingaman that I've been thinking in my mind, that maybe we need 
a national effort with something like we might call a National 
Energy Workforce Training Act, and then figure out what the 
Federal Government can do to help organize and help see that 
the right kind of information gets to our schools, so that 
community colleges would start training, maybe even vocational 
education programs can be reinstated at seniors in high school, 
so they will get, at least, excited about these kinds of 
things.
    Now, that's not what I had in my opening statement----
    [Laughter.]
    Senator Domenici. So, Senator Bingaman, if you'll forgive 
me, I won't give the opening statement, that will be it, and 
I'll ask that it go in the record. I thank you for calling the 
hearing, and I join in thanking you all who came, especially 
those from far away.
    We hope we get enough out of this to justify all you have 
done to help us.
    Thank you, Mr. Chairman.
    [The prepared statement of Senator Domenici follows:]

    Prepared Statement of Hon. Pete V. Domenici, U.S. Senator From 
                               New Mexico
    Good morning. I thank you all for your attendance and participation 
in today's hearing on the current and projected workforce needs of our 
nation's energy sector.
    Our witnesses today will describe the pressing needs facing the 
energy sector in recruiting, training, and retaining skilled workers 
for their industries. The energy industry employs well over 1 million 
people and accounts for 4 percent of the Gross Domestic Product. Half 
of these workers--that's 500 thousand people--are expected to retire 
over the next five to ten years creating a turnover rate of 50 percent.
    An analysis by Cambridge Energy Research Associates projects big 
delays for large oil and gas production projects worldwide owing to the 
expanding shortfall of qualified engineers and skilled workers. The 
workforce shortfall could be 10 to 15 percent by 2010, according to 
their comprehensive analysis of the engineering and project management 
staff needed to deliver the over 400 major projects expected to come 
on-stream over the next five years. Their analysis confirms that 
engineering and project management personnel are already insufficient 
to meet upstream project demand.
    A recent study by the Global Energy Management Institute at the 
University of Houston estimated that the energy sector's talent 
shortage cost the industry more than $5 billion in pretax profits in 
2006. This estimate includes costs due to higher wages offered when 
competing for workers, and lost business opportunities due to a lack of 
available workers.
    Take, for instance, the current shortage of welders. At Williams, a 
unit of Canada's Flint Energy Services Ltd., the Rocky Mountain 
region's thin labor pool has hindered efforts to train more welders 
through an on-site training and apprenticeship program. Executives say 
the company could increase production by 20% to 25% if it had more 
welders.
    Williams has raised its starting wage for welders by 30% over the 
past two years to $16 an hour. This year, it sent recruiters to job 
fairs as far away as Saginaw, Michigan to recruit welders from the 
declining auto industry.
    Moreover, because these worker shortages are international in 
scope, we will not be able to simply import skilled workers to address 
national shortages. In Canada's Athabasca oil sands region, engineers 
and workers are relocating from as far away as Mexico and China to join 
the labor pool.
    Energy projects in the Arab Gulf region face delays and 
cancellations due to a massive shortage of engineers and laborers to 
build them. Analysts predict over the next five years, the Arab Gulf 
region will need an extra 100,000 engineers and contractors, and 
another 600,000 construction workers. To stay competitive as a nation, 
we need to continue to create good jobs in America's energy sector--and 
to make sure we are doing everything we can to recruit, train, and 
retain workers to support our energy industries.
    I look forward to learning more about these challenges from our 
witnesses. Thank you.

    The Chairman. Thank you very much.
    Senator Corker, did you have an opening statement?

   STATEMENT OF HON. BOB CORKER, U.S. SENATOR FROM TENNESSEE

    Senator Corker. I think you all opened very well, and I 
look forward to the testimony.
    The Chairman. All right. We will start with our witnesses 
here, we have two witnesses from the Federal Government, and 
another witness on this panel.
    Emily DeRocco, who is the Assistant Secretary of the 
Department of Labor, thank you for being here. Patricia 
Hoffman, Deputy Director in the Department of Energy, thank you 
for being here. Andra Cornelius, who is with Workforce Florida, 
Inc., in Tallahassee, thank you very much for being here.
    Why don't we just go across the--if you could take 5 or 6 
minutes and just summarize the main points, we will include 
your full statement in the record.
    Senator Domenici. Senator Bingaman, might I state for the 
record that last, yesterday evening late, the Appropriations 
Committee called a conference meeting on the defense part of 
the bill, and I'm on that, and I think you would like me to go 
to that meeting, as well as I would like to go.
    So, I'm going to go there, and try to come back as soon as 
I can. Thank you very much.
    The Chairman. All right.
    OK, Secretary DeRocco, go right ahead.

    STATEMENT OF EMILY STOVER DEROCCO, ASSISTANT SECRETARY, 
                      DEPARTMENT OF LABOR

    Ms. DeRocco: Thank you, Mr. Chairman, Senators, for 
inviting the Department of Labor to testify at this very 
important hearing on the workforce challenges confronting the 
energy industry, and how we at the Department of Labor are 
helping the industry respond to these challenges.
    To better understand the workforce issues of the energy 
industry, in 2004 and 2005, my agency--the Employment and 
Training Administration--conducted 7 forums for executives from 
all sectors of the industry--oil and gas, electric and natural 
gas utilities, nuclear, and mining. These forums provided us, 
and the workforce investment system, with the opportunity to 
gain deep understanding of the critical workforce needs of the 
industry, and to begin developing model solutions to meet their 
challenges.
    Our discussions with the industry identified several key 
workforce development concerns.
    First, a large percentage of current workers in the 
industry are nearing retirement. The average age of workers in 
the energy industry is now over 50, and the industry estimates 
that up to half of its current workforce--more than 500,000 
workers--will retire within 5 to 10 years.
    As experienced workers retire, they are difficult to 
replace, because too few entry-level workers are equipped with 
the advanced skills required by today's technologically 
sophisticated companies. Creative solutions are necessary to 
help experienced workers who will be retiring, transfer their 
knowledge and skills to their replacements, and to help new 
workers gain necessary skills as quickly as possible.
    The situation is compounded by the problem that too few 
potential workers are interested in careers in the energy 
industry. Stereotyping of energy careers as ``low skilled'' 
causes qualified workers and youth to be unaware of the many 
highly skilled, well-paying career opportunities the industry 
has to offer.
    An additional set of challenges arises because many 
training programs were reduced or eliminated during the 
downturn the industry experienced in the late 1980s and early 
1990s. Programs have not expanded at the same rate that the 
industries need has rebounded.
    Also, we know that employers in all sectors need workers 
who are more proficient than their predecessors in math, 
science, and especially technology skills.
    Finally, it was noted at the forum that too few industry-
defined, portable credentials have been developed in the energy 
industry. Additionally, some energy occupations lack clearly 
recognizable career ladders, necessary for instilling a new 
perception that working in the industry is an attractive and 
viable long-term career choice.
    ETA began addressing these workforce challenges through an 
initiative called the High Growth Job Training Initiative. 
Launched in 2002, this initiative is the cornerstone of the 
Administration's efforts to create a workforce investment 
system, through which taxpayers invest over $15 billion a year, 
that is demand-driven, and balances the needs of America's 
workers with the demands of employers.
    Under this initiative, we've awarded 11 grants, totaling 
$27 million, to help model how to meet the workforce needs of 
the energy industry.
    A quick example is our investment with the State of 
Alaska's Department of Labor and Workforce Development. In 
order to meet the State of Alaska's demand in the energy 
sector, the State--in partnership with education and industry--
is directing training resources directly toward energy-related 
competencies and occupations, while at the same time 
integrating their vocational and technical education program 
with energy skills training.
    A key component of this initiative is the use of the 
apprenticeship model, a training tool that has been proven to 
improve job level skills, and workforce readiness across a 
number of sectors, including energy.
    Our work in the high-growth sector revealed a critical 
shortcoming in the workforce development capacity of many 
regions. To address this capacity issue, the Administration has 
initiated the community college initiative, or Community-Based 
Job Training Grants, to address the need for expanded, 
affordable, flexible education and training capacity in local 
communities across the country. Due to their close connection 
to communities, community colleges are well-positioned to 
understand the intricacies of the industry's needs, and better 
prepare workers for occupations in these localized industries.
    Of our current community college initiatives, 13 grants, 
totaling $20 million have been awarded, that focus specifically 
on the energy sector. Another example in this arena is with 
Montana State University at Billings, to develop an industry-
driven model for just-in-time training, programs in the energy 
industry, responsive to new technologies being used in mining, 
oil and gas, power generation and biofuels. This project will 
train over 1,000 individuals for careers in the industry.
    Finally, building on the principles of both the High-Growth 
and Community College initiatives, we have begun the Workforce 
Innovation in Regional Economic Development Initiative, or 
WIRED. WIRED seeks to help regional economies transform their 
workforce investment, economic development, and education 
systems to support overall economic growth by fostering talent 
development in high- growth industries. Thirteen of our current 
39 WIRED regions are focusing on the energy industry, and their 
talent development needs, and this includes, for example, the 
Central New Mexico region.
    This regional initiative is led by New Mexico's technology 
triangle, an industry-driven regional development alliance 
affiliated with New Mexico Tech University in cooperation with 
a broad array of stakeholders, the alliance is coordinating an 
inter- regional effort to stimulate entrepreneurship, develop 
the technical workforce needed by the energy industry, and 
create a policy environment that supports and rewards 
innovation.
    A very important element of WIRED has been our partnership 
with other Federal agencies, particularly the Department of 
Energy. We have engaged, since 2006, with the National Labs, 
represented here today by the National Renewable Energy 
Laboratory, which has become a full partner with the WIRED 
regions which are exploring alternative energy growth and 
opportunities to take advantage of the National Lab's 
resources, expertise and technical assistance, to increase 
industrial competitiveness, stimulate employment opportunities, 
and foster public/private collaboration in talent development.
    We have many other initiatives I'd like to share with you, 
they're in my written testimony. Perhaps the most important of 
which are two we conducted with the 16 Southern States, an 
energy Skilled Trade Summit, just a few months ago, to deal 
with the issue of advancing careers in the construction 
industry tied to new construction in the energy industry, and 
we have also launched a partnership with the Departments of 
Energy and Interior to conduct the study called for in the 
Energy Policy Act, on the availability of skilled workers in 
the industry. This study will be done by the National Academy 
of Sciences.
    We understand that energy is a critical driver in America's 
economic growth and competitiveness in the 21st Century 
economy, and that high wage opportunities with established 
career pathways are awaiting American workers in the energy 
industry. The Department of Labor is prepared to continue to 
support these efforts.
    [The prepared statement of Ms. DeRocco follows:]

     Statement of Emily Stover Derocco, Assistant Secretary, Labor 
      Employment and Training Administration, Department of Labor
    Mr. Chairman and Members of the Committee, thank you for the 
opportunity to provide the Department of Labor's perspective on the 
workforce challenges confronting the energy industry. Recognizing the 
importance of this sector of our economy to the Nation's overall global 
competitiveness, the Department of Labor has been actively helping the 
energy industry respond to the workforce challenges it faces.
    The U.S. energy industry is undergoing a dramatic transformation as 
advanced technologies revolutionize the traditional methods of energy 
extraction and refinement. In addition, the renewable and alternative 
energy field presents a whole new set of opportunities for the industry 
that did not exist a decade ago. We recognize this transformation as 
critically important for our economy as a whole, and that a successful 
transformation requires a highly-skilled workforce. Therefore, we are 
working with the energy industry to understand their business 
processes, market dynamics, and skilled workforce needs.
    Leaders in the energy industry, along with other high growth 
sectors of the economy, express the need for more highly trained and 
highly skilled workers in order to grow and be competitive in the years 
ahead. Most of the new jobs created today require at least some post-
secondary training, whether it be a vocational degree or certificate, 
apprenticeship training, or a four-year degree from a college or 
university. However, the skilled workers that companies need are 
becoming increasingly difficult to find. This is where the Department 
of Labor has an important role to play.
    High-wage employment opportunities with established career pathways 
are awaiting American workers in the energy industry, but first, some 
key workforce challenges must be overcome. Now, and over the next few 
years, the public workforce investment system, private industry, the 
education system, and the entire energy community must work together to 
address the following challenges: the aging of the energy workforce and 
the lack of highly-trained workers in the pipeline to replace them; 
outdated misconceptions about careers in the energy sector; the lack of 
energy training and education programs due to elimination of programs 
during the recession of the early 1990s; the demand for workers with 
higher levels of science, technology, engineering, and mathematics 
skills; and the need for industry-recognized credentials and better 
career pathways for workers in the energy industry.
    The Role of the Workforce Investment System Currently, the Federal 
government invests over ten billion dollars annually in job training 
and employment assistance programs. The Employment and Training 
Administration (ETA) administers many of these programs, through the 
public workforce investment system, with a goal of preparing workers 
for jobs of the 21st century. The workforce system is an important 
resource that the energy industry can draw upon to secure a skilled 
workforce.
    ETA has strived to build a ``demand-driven'' workforce system to 
provide America's economic engine--businesses--with the highest quality 
workers possible, and to link the two together for their mutual 
benefit. This relationship allows businesses to be more competitive in 
the global economy and workers to live more productive and prosperous 
lives. Key to the success of a demand-driven system is the workforce 
investment system's ability to respond to the needs of the labor market 
by partnering and working collaboratively with businesses, educators 
and trainers, and community leaders in a strategic effort to prepare 
workers for opportunities in high growth sectors of the economy. In 
recent years we have undertaken a series of initiatives to better do 
this, starting with the High Growth Job Training Initiative.
          the president's high growth job training initiative
    ETA began working to address the workforce challenges of the energy 
industry through the President's High Growth Job Training Initiative. 
Launched in 2002, this initiative is the cornerstone of the 
Department's efforts to create a workforce investment system that is 
demand-driven and balances the needs of America's workers with the 
demands of employers. Under the High Growth Job Training Initiative, 
ETA has partnered with 14 high growth industries and economic sectors, 
including energy, to evaluate their skill needs and ensure that workers 
are being trained with the skills these businesses require.
    Through the High Growth Job Training Initiative, ETA has invested 
$288,517,000 in 156 partnerships among employers, education programs, 
and the workforce investment system. Each project targets the skill and 
talent needs of high growth, high demand industries in our nation's 
economy and provides the resources necessary to develop the capacity to 
train workers in the skills demanded by the 21st century economy. By 
training workers with the skills employers want, more workers will 
obtain quality jobs that pay higher wages, while enabling employers to 
address their skill shortages and better compete in today's changing 
economy.
    To better understand the workforce issues of the energy industry, 
in 2004 and 2005, ETA conducted seven forums for executives from all 
segments of the oil and gas industry, electric and natural gas 
utilities, nuclear energy, and mining. These forums provided us and the 
workforce investment system with the opportunity to gain further 
understanding of the critical workforce needs of the industry and 
develop workforce solutions.
    Our discussions with the energy industry in these forums identified 
several key workforce development concerns. First, a large percentage 
of current workers in the energy industry are nearing retirement. The 
average age of workers in the energy industry is now over 50, and the 
industry estimates that up to half its current workforce--more than 
500,000 workers--will retire within 5 to 10 years. As experienced 
workers retire, they are difficult to replace because too few entry-
level workers are equipped with the advanced skills required by today's 
technologically-sophisticated companies. Creative solutions are 
necessary to help experienced workers who will be retiring transfer 
their knowledge and skills to their replacements and to help new 
workers gain necessary skills as quickly as possible.
    The situation is compounded by the problem that too few potential 
workers are interested in careers in the energy industry. Stereotyping 
of energy careers as low-skilled causes qualified workers, especially 
youth, to be unaware of the many highly skilled, well-paying career 
opportunities the industry has to offer.
    An additional set of challenges arises because many training 
programs were reduced or eliminated during the downturn the industry 
experienced in the late 1980s and early 1990s. Programs have not 
expanded at the same rate that the industry's need has rebounded. Also, 
we know that employers in all sectors of the industry need workers who 
are more proficient than their predecessors in math, science, and 
especially, technology skills.
    Finally, it was noted at the forums that too few industry-defined, 
portable credentials have been developed in the energy industry. 
Additionally, some energy occupations lack clearly recognizable career 
ladders necessary for instilling a new perception that working in the 
industry is an attractive and viable long-term career choice.
    Working from this foundation of information about the workforce 
challenges faced by the energy industry, investments were made under 
the High Growth Job Training Initiative to implement solutions to the 
identified challenges. Of 156 current investments under the initiative, 
11 grants totaling $27,093,668 have been awarded to help meet the 
workforce needs of the energy industry. One example is our investment 
with the State of Alaska's Department of Labor and Workforce 
Development. In order to meet the growing workforce demand in the 
energy sector, the State of Alaska, in partnership with education and 
industry partners, is directing training resources towards energy-
related occupations while at the same time integrating vocational and 
technical education with skills training. A key component of this grant 
is also apprenticeship training--a training tool that has proven to 
improve job skill levels and workforce readiness across a number of 
industry sectors, including energy. To build upon the current 
investments, ETA anticipates announcing a Solicitation for Grant 
Applications targeting the energy industry under the High Growth Job 
Training Initiative later this year.
                  community-based job training grants
    Our work under the High Growth Job Training Initiative revealed a 
critical shortcoming in the workforce development capacity of many 
regions: many communities are not positioned to meet the training 
demands of our high growth industries because of limited training 
capacity and outdated curricula and training delivery systems. To 
address this need for expanded affordable, flexible education and 
training capacity in local communities across the country, President 
Bush established the Community-Based Job Training Grants program. The 
initiative provides grants to help community and technical colleges 
train workers for jobs in high growth sectors though the use of 
community and technical colleges.
    Due to their close connection to local labor markets, community 
colleges are well positioned to understand the intricacies of local 
economies and better prepare workers for occupations in these localized 
industries. To date, the Department has provided $250,000,000 to 142 
community colleges, One-Stop Career Centers and other entities under 
this initiative. A third round of Community-Based Job Training Grants 
totaling $125,000,000 is currently under review by the Department and 
award announcements are expected soon.
    Of the current investments, grants totaling $20,405,604 have been 
awarded that focus on the energy sector. One of those investments is a 
$1,998,885 grant to Montana State University at Billings to develop an 
industry-driven model for just-in-time training programs in the energy 
industry, including mining, oil and gas exploration and production, 
power generation, biofuels, bioproduct development, renewable resources 
and energy-related construction. The grant expects to train over 1,000 
individuals for jobs in energy and establish an Energy Workforce 
Training Center that will focus on jobs in the energy industry and will 
support training programs and degrees that serve the developing 
biofuels sector.
         workforce innovation in regional economic development
    Building on the principles of the High Growth Job Training 
Initiative and Community-Based Job Training Grants is the Workforce 
Innovation in Regional Economic Development Initiative, or WIRED. The 
WIRED Initiative is also answering the call for competitiveness by 
fostering innovation through regional workforce and economic 
development. Though global competition is often seen as a national 
challenge, it is actually at the regional level where solutions must be 
developed and the challenges met. It is in regional economies where 
companies, workers, researchers, educators, entrepreneurs and 
government come together to create a competitive advantage and where 
new ideas and new knowledge are transformed into advanced, high-quality 
products or services.
    WIRED focuses on labor market areas that are comprised of multiple 
jurisdictions within a state or across state borders. It seeks to help 
regions transform their workforce investment, economic development, and 
education systems to support overall regional economic growth by 
fostering collaborative partnerships among universities, businesses, 
government, workforce and economic development organizations, and other 
key regional partners. Many of the regions selected have been affected 
by global trade or Base Realignment and Closures (BRAC) activities, are 
dependent on a single industry, or are recovering from natural 
disasters. Under the WIRED Initiative, ETA has invested $325 million 
and is providing expert assistance to 39 regions across the nation to 
implement strategies that will create high-skill and high-wage 
opportunities for American workers.
    To date, 13 of the 39 WIRED Regions are focusing on the energy 
industry, including the Central New Mexico region. The regional 
initiative is led by New Mexico's Technology Triangle, an industry-
driven non-profit regional development alliance affiliated with New 
Mexico Tech University. The alliance supports the growth of 
entrepreneurship, talent and innovation in the state's green 
manufacturing industries, including renewable energy, green building, 
aerospace and aviation, microelectronics, and optics. In cooperation 
with a broad array of stakeholders within and beyond the eight-county 
region, the alliance seeks to coordinate an inter-regional effort to 
stimulate entrepreneurship, advance the development of the technical 
workforce, and create a public policy environment that supports and 
rewards innovation.
    An important element of the WIRED Initiative is the partnerships 
that ETA has developed with other Federal agencies. ETA has worked with 
10 other Federal agencies, including the Department of Energy (DOE), to 
provide funding, technical assistance, and other support to the WIRED 
regions. Beginning in 2006, ETA began working with the national 
laboratories of DOE, including Oakridge National Laboratory and the 
National Renewable Energy Laboratory (NREL) to increase WIRED region 
access to Federally-funded technologies at Federal laboratories. Site 
visits at both locations led to increased discussion on how DOE and DOL 
can work together to share resources, experience, technology, 
information and infrastructure in solving our workforce challenges in 
the energy industry. Our partnership with NREL is particularly 
noteworthy because it is the only national laboratory dedicated to 
renewable energy and efficiency research and development. The assets 
and resources at NREL were shared with WIRED regions during a two-day 
institute, April 18 and 19, 2007, at which WIRED regional leaders were 
introduced to methods to increase industrial competitiveness, stimulate 
wealth creation and employment opportunities, foster public-private 
collaboration in technology development, and increase innovation, all 
of which are essential elements in today's ``knowledge economy.''
                     additional energy initiatives
    ETA has also undertaken a number of other initiatives to more fully 
understand the workforce development challenges of the energy industry 
and to ensure that the industry has highly skilled workers, including 
holding an Energy Skilled Trade Summit, utilizing apprenticeship as an 
important pipeline of workers into the industry, and launching a study 
on the workforce needs of the industry.
Energy Skilled Trade Summit
    To address the workforce challenges faced by the Energy Skilled 
Trades sector, ETA, in partnership with the energy industry and the 
construction firms and labor management organizations that support it, 
embarked on another initiative to improve the pipeline of craftsmen and 
utility workers, with a focus on the Southeastern United States. To 
kick off the initiative, ETA convened an Energy Skilled Trades Summit 
in August 2007 in Biloxi, Mississippi, as part of the Southern 
Governors' Association meeting, hosted by Governor Haley Barbour. 
Additional key sponsors were the Nuclear Energy Institute, Edison 
Electric Institute, the American Petroleum Institute, and the Center 
for Energy Workforce Development (CEWD). Among the over 300 attendees 
were four Governors and 20 CEOs of major energy and construction firms. 
Summit participants discussed strategies to align Federal, state, and 
local resources to increase the supply of workers for high growth, high 
demand careers in the energy and construction industries, and began to 
develop state action plans for improving synergy between industry and 
the education, workforce, and economic development systems. ETA and 
industry leaders have pledged their continued support for this 
initiative.
Apprenticeship Programs
    ETA administers the National Apprenticeship Act, which establishes 
the framework for registered apprenticeship programs. The 
apprenticeship model continues to use the time-tested method of 
learning on-the-job in combination with related technical and 
theoretical instruction in the classroom to train workers in skilled 
occupations. Apprenticeship is an industry driven system that develops 
employee skills, competencies, and knowledge in order to meet the 
workforce development needs of business. Currently, there are over 900 
active apprenticeship programs in energy industries, involving 5,900 
apprentices in occupations such as power plant mechanic, boilermaker, 
line erector, and operating engineer. These numbers will continue to 
grow. As the energy industry builds new facilities and adopts new 
processes due to technological advances, the apprenticeship system 
works closely with program sponsors to adapt apprenticeship programs to 
keep pace with these changes.
Study of Energy and Mining Workforce Supply
    The Energy Policy Act of 2005 directed DOE to enter into an 
agreement with the National Academy of Sciences to conduct a study on 
the availability of skilled workers in the energy and mining 
industries. Given our interest and expertise in workforce issues, ETA 
approached DOE and proposed to administer this study on their behalf. 
ETA is prepared to commit $750,000 to the study, and is executing a 
Memoranda of Understanding with DOE to carry out this study. The 
Department of Interior is also interested in this issue and will 
contribute funding to the study. ETA will soon execute a procurement 
with the National Academy of Sciences to conduct the study, which we 
expect to be completed by next fall. This study will provide 
significant information about the availability of workers to meet 
energy and mining industry demands. In turn, this will help us learn 
about strategies on how to best meet those demands, thus contributing 
to securing the Nation's energy future.
                               conclusion
    In conclusion, Mr. Chairman, energy remains a critical driver of 
America's economic growth and competitiveness in the global economy of 
the 21st century. High-wage employment opportunities with established 
career pathways are awaiting American workers in the energy industry. 
The programs and initiatives I have described will not only help 
address the structural changes the energy industry is facing, but they 
will provide a skilled workforce that can take advantage of the 
employment opportunities that exist in the industry. At this time I 
would be pleased to answer any questions that you or other Committee 
Members may have.

    The Chairman. Thank you very much.
    Ms. Hoffman, go ahead.

 STATEMENT OF PATRICIA A. HOFFMAN, DEPUTY DIRECTOR, DEPARTMENT 
                           OF ENERGY

    Ms. Hoffman. Mr. Chairman and members of the committee, 
thank you for this opportunity to testify on behalf of the 
Department of Energy on the nation's domestic energy sector 
workforce.
    Our nation's technical workforce is the backbone of our 
economy. Given looming retirements in the energy workforce, 
success in ensuring America's future energy security will 
depend on our ability to recruit, educate, and train highly 
skilled workers. Energy security is undeniably linked to our 
national interests.
    In 2006, the Department of Energy released a report to 
Congress on workforce trends in the electric utility industry, 
pursuant to Section 1101 of the Energy Policy Act. Although the 
report did not forecast an immediate threat to the reliability 
of the electric system, it raises awareness of the need to plan 
for, and proactively address this workforce transition.
    One example of a successful public-private partnership in 
this area is the Department's designation of Bismarck State 
College in North Dakota as the National Power Plant Operations 
Technology and Educational Center.
    The Administration, through efforts such as the Advanced 
Energy Initiative, supports the enhanced use of renewable 
electricity generation. It is clear that continued innovation 
and a strong workforce is an important part of unlocking and 
sustaining our energy future with renewable technologies. DOE 
also estimates there may be additional workforce needs in the 
building sector, ranging from trade skills to building 
professionals. DOE is working with a consortium of universities 
to develop multi-level, multidisciplinary building science 
curricula, to support the long-range needs of the home building 
industry.
    The expansion of nuclear power in the United States offers 
our nation the opportunity to foster continued economic growth. 
DOE's Nuclear Energy Research Initiative, which focuses on 
developing nuclear science and technology, recently announced 
the selection of 11 U.S. University-led grant recipient teams, 
to receive up to $30.7 million for cooperative research 
projects.
    The Department also supports the White House Initiative on 
Historically Black Colleges and Universities (HBCU's) in 
developing the energy sector. This is administered within the 
U.S. Department of Education. In the last three Fiscal Years, 
the Department's National Nuclear Security Administration 
(NNSA) has awarded 41 grants to 25 HBCUs, totaling over $47 
million. These grants cover research related to NNSA's nuclear 
security and non-proliferation mission requirements.
    DOE's Office of Economic Impact and Diversity also 
facilitates numerous mentor-protege relationships. This past 
summer, for example, the Oak Ridge National Laboratory and 
Morehouse College signed the first of the such agreements 
between an HBCU and a DOE Office of Science Laboratory. This 
new joint initiative will assist students in the college's 
science programs, as well as promote research collaborations at 
both institutions.
    To meet future workforce requirements, the Department has 
several recommendations for the committee.
    First, foster math and science education. The DOE's Office 
of Science has been a long-dominant Federal sponsor of basic 
research in the physical science. These research programs are 
supported by a dedicated effort designed to recruit, train and 
retain the next generation of Americans who are interested in 
science, technology, engineering and mathematics.
    One example of this is DOE's annual ``Day of Science'' at 
Oak Ridge National Laboratory in Tennessee, which this year was 
attended by more 1,000 students from 125 universities.
    Second, support strategic research in engineering. 
University curricula should strike an effective balance between 
addressing the short-term needs of industry and promoting the 
strategic research necessary to maintain America's long-term 
competitiveness. Without strong support for strategic research 
in engineering and without qualified replacements for retiring 
faculty, the strength of our nation's university-based 
engineering programs will wane.
    To help address this trend, the Department's funding for 
the Power Systems Engineering Research Center--a multi-
university, multidisciplinary National Science Foundation-
sponsored center--develops broadly trained power engineers, as 
well as future power engineering faculty candidates.
    Third, develop cross-cutting understanding. An analysis of 
the interdependencies of the workforce across the entire energy 
flow is required to ensure the energy reliability will not be 
impacted by a national shortage of skilled personnel. The 
Department of Energy is partnering with the Department of Labor 
(DOL) to arrive at a better understanding of the energy sector 
workforce issues. As Assistant Secretary DeRocco mentioned, the 
Department of Energy is working with DOL to fulfill the 
requirements of Section 385 and 1830 of EPACT. As you know, 
these sections require DOE to enter into an arrangement with 
the National Academy of Sciences to conduct a study on the 
availability of skilled workers in the energy sector.
    This concludes my statement, Mr. Chairman, and I look 
forward to answering any questions that you and your colleagues 
may have.
    [The prepared statement of Ms. Hoffman follows:]

Statement of Patricia A. Hoffman, Deputy Director, Department of Energy
    Mr. Chairman and Members of the Committee, thank you for this 
opportunity to testify on behalf of the Department of Energy (DOE) on 
the nation's domestic energy sector workforce.
    Our nation's technical workforce is the backbone of our economy. 
These individuals have accumulated a wealth of experience and knowledge 
that cannot be duplicated overnight. If America is to remain the 
world's leader in science and technology and continue to lead the world 
in energy innovation, the energy industry needs to invest in a vibrant 
workforce.
    Given looming retirements in the energy workforce, success in 
ensuring America's future energy security will depend on our ability to 
recruit, educate, and train highly skilled workers to meet the demands 
of our rapidly evolving, technology-driven energy industries. As 
traditional sources of energy become more stretched by the growing 
demand for energy domestically and globally, our nation's energy sector 
will undergo significant changes. Energy security is undeniably linked 
to our national interest. The move to diversify our energy supply from 
the conventional sources of the past requires equipping our workforce 
with the skills, technology, and creativity required to achieve a 
sustainable energy future.
                            electric sector
    In 2006, DOE released a report to Congress on ``Workforce Trends in 
the Electric Utility Industry,'' pursuant to section 1101 of the Energy 
Policy Act of 2005 (EPACT). The report examined workforce trends 
associated with the electricity delivery industry, which is the primary 
focus of my office, OE. For electric utilities, whose service quality 
and reliability depend on maintaining an adequate, knowledgeable 
workforce, managing the upcoming retirement transition is a particular 
challenge.
    Although the report did not forecast an immediate threat to the 
reliability of the electric system, it raises awareness of the need to 
plan for and proactively address this workforce transition. For the 
purposes of this analysis, trends associated with electrical 
lineworkers and electric power engineers were considered representative 
of the broader electric utility workforce. Electrical lineworkers' 
responsibilities include erecting poles and light or heavy-duty 
transmission towers and installing or repairing cables or wires used to 
carry electricity from the power plant to the customer; they represent 
the physical labor required to operate and maintain the electric grid. 
Electric power engineers traditionally focus on systems and devices for 
the conversion, delivery, and use of electrical energy. These 
applications enable technology enhancements that significantly improve 
the capability, performance, and reliability of the entire electricity 
system.
                          electric lineworkers
    Since 2000, the electric utility industry's employment level for 
lineworkers, which experienced declines from the early 1990s into the 
early 2000s that coincided with restructuring of the industry, has been 
steadily increasing. This hiring trend is driven by utilities' 
anticipation of increased demand, and is a response to the long periods 
of little or no capital investment. Utilities, concerned at the 
prospect of meeting rising demand for electricity using the existing 
transmission lines, have embarked upon a hiring program to provide the 
employees necessary to maintain, upgrade, and expand the electric 
utility system. The August 2003 U.S.-Canada blackout also focused 
attention on the fragile state of the grid, which put pressure on 
utilities to ensure that they were meeting reliability standards.
    Growth in the industry is outpacing the number of available and 
qualified personnel. In 2005, there were approximately 31 lineworker-
training programs across the country, with a total of 1,360 active 
students in various stages of lineworker training. Should the present 
trend continue, the number of pre-apprenticeship lineworker training 
institutions across the country could increase to 45 institutions by 
the year 2015. Yet, even with the increased interest of students in 
entering these training programs, the numbers may still not be enough 
to compensate for the expected retirements. Across the organizations 
contacted for the section 1101 report, retirement eligibility and the 
percentage of the workforce expected to retire within the next five to 
ten years varies from about 11 percent to as high as 50 percent. One 
utility indicated that the high level of retirements that began a few 
years ago is expected to persist for the foreseeable future due to this 
demographic profile, which includes a very high percentage of the 
lineworker and engineering workforce.
    The electric industry is being proactive in addressing the 
lineworker shortage by building awareness, encouraging training 
initiatives, and increasing interest in the lineworker profession at an 
early age. It is important to note, however, that the magnitude of the 
impact on individual utilities varies significantly. Even with the 
addition of new lineworkers to the labor pool, the loss of historical 
knowledge (and perhaps productivity due to the more inexperienced 
workforce) might by itself have a detrimental effect on the reliability 
and security of the grid.
    Adequate training is the key to sustaining a qualified pool of 
lineworkers. Preparing a highly skilled electric utility lineworker can 
require 10 to 12 years, including classroom instruction and on-the-job 
experience. Potential lineworkers pass through various stages of career 
development, from ``Introductory Training'' to formal apprenticeship 
programs to on-the-job learning. Since the attrition rate is very high 
for new lineworkers, these courses help orient trainees to the mindset 
needed for lineworker careers before utilities make a large investment 
in the employee's career development. In many cases, however, utilities 
will bring trainees directly into their apprenticeship programs without 
the student having completed an introductory training program.
    Strong public-private partnerships are necessary to promote the 
energy industry as a viable employment option, to develop strategies 
for encouraging retirement-eligible workers to remain employed in the 
industry, and to ensure adequate training and education opportunities. 
Developing and using technology to increase productivity and fostering 
knowledge transfer may also be beneficial.
    One example of a successful public-private partnership, although 
geared toward operator training and not lineworkers, is the 
Department's designation of Bismarck State College in North Dakota as a 
National Power Plant Operations Technology and Educational Center. 
Bismarck State's programs in power plant, process plant, electric 
power, electrical transmission systems, and nuclear power technologies 
will educate and train many of our future energy sector workers. It 
also uses the latest technologies via the internet and training 
simulations to speed up the knowledge transfer process.
               electric power and transmission engineers
    Jobs for new power engineering graduates began declining in the 
1980s when utilities saw a decline in electric consumption, and the job 
market remained challenging with deregulation in the 1990s. However, by 
2001 and 2002, power engineering graduates were able to find positions 
at generation companies, transmission companies, power traders, 
independent system operators, independent power producers, consulting 
companies, and large processing and manufacturing companies that have 
extensive electrical facilities.
    As detailed in the section 1101 report, the projected demand for 
power engineers will grow to 11,113 by 2014, which represents an 8.1 
percent increase. The average annual demand for electrical engineers in 
the electric utility industry is 749 per year for the 10 year period 
from 2004 to 2014. International competition and the use of engineering 
services performed in other countries may limit employment growth 
domestically; nevertheless, the projected strong demand for electrical 
devices such as giant electric power generators could provide 
employment opportunities in the U.S.
    Over the past decades, there has been a decline in the United 
States in the number of students considering power engineering careers. 
In contrast, in many countries outside of the United States, the power 
engineering profession enjoys more prestige and thus, experiences 
higher enrollment levels. There are indications that the power 
engineering education system in the United States is actually 
weakening, and the rate of weakening will likely escalate as faculty 
retirements occur without replacement. Without strong support for 
strategic research and without qualified replacements for retiring 
faculty, the strength of the university-based power engineering 
education programs will continue to decline. This is in part because 
some schools do not rehire power faculty and instead use the faculty 
slots to hire individuals with other technical knowledge.
    DOE supports Gonzaga University in Spokane, Washington in 
developing an online certificate program in transmission and 
distribution engineering aimed at practicing utility engineers who seek 
to broaden and upgrade their skills. In addition to basic electric 
design, construction, operation, and maintenance courses, this program 
also plans to offer courses in related disciplines that would examine 
the environmental and legal aspects of electric line design, which have 
become inherent components of modernizing the grid. The availability of 
this course online minimizes the disruption to the engineer's work 
schedule and reduces the employer's cost for the training.
                        renewable energy sector
    The Administration, through efforts such as the Advanced Energy 
Initiative, supports new, bold steps toward the goal of a reliable, 
affordable, and clean energy future for all Americans. In the energy 
sector, the enhanced use of renewable electricity generation--from such 
sources as solar photovoltaics, high-efficiency wind power, and 
biomass--would help reduce emissions of air pollutants and greenhouse 
gases. It is clear that continued innovation is an important part of 
unlocking our energy future.
    The Department has conducted surveys of key market participants to 
better understand the time required for training qualified photovoltaic 
(PV) installers. These surveys 5 indicate that the time to train a 
qualified PV installer ranges from 6 weeks to 3 months if the trainee 
already has basic training in a key ``enabling'' trade, for example, as 
an electrician or roofer.
    DOE also estimates there may be additional workforce needs in the 
buildings sector, including trained trades and trades management 
(electrical, plumbing, HVAC techs, etc.); mid-level construction 
managers and building operators/energy managers; skilled professionals 
(lighting designers, building commissioners, energy auditors, 
construction specifiers/purchasing agents, etc); and building 
professionals (architects, engineers, designers, etc.). DOE is working 
with a consortium of universities to develop multilevel, multi-
disciplinary building science curricula to support the long range needs 
of the home building industry. The Department is also working with 
professional organizations like AIA, ASHRAE, IESNA, and IALD to promote 
the integration of efficiency technologies and practices into their 
professions as well as to draw upon their knowledge as we implement our 
programs.
                             nuclear sector
    The expansion of nuclear power in the United States offers our 
nation the opportunity to foster continued economic growth, to raise 
living standards, and to be responsible stewards of the environment by 
reducing greenhouse gas emissions. DOE's Nuclear Energy Research 
Initiative, which focuses on developing nuclear science and technology, 
recently announced the selection of 11 U.S. university-led grant 
recipient teams to receive up to $30.7 million for cooperative research 
projects.
 white house initiative on historically black colleges and universities
    The Department also supports the White House Initiative on 
Historically Black Colleges and Universities (HBCUs) in developing the 
energy sector, which is administered through the office of the 
Secretary within the U.S. Department of Education. In the last three 
fiscal years, the Department's National Nuclear Security Administration 
(NNSA) has awarded 41 grants to 25 HBCUs totaling over $47 million. The 
grants cover research related to the NNSA's nuclear security and 
nonproliferation mission requirements, curriculum development in 
science and technology programs, and infrastructure improvements.
    DOE's Office of Economic Impact and Diversity also facilitates 
numerous mentor-protege relationships. This past summer, for example, 
the Oak Ridge National Laboratory and Morehouse College signed the 
first such agreement between an HBCU and a DOE Office of Science 
laboratory. The new joint initiative will assist students in the 
college's science programs and promote research collaboration at both 
institutions. Many students from Historically Black Colleges and 
Universities have participated in the Department's internship programs. 
Interns from summer 2007 in our offices in Washington, DC and 
Germantown, Maryland, worked on projects in nuclear energy, computer 
technology, radioactive waste, energy efficiency, scientific research, 
and environmental management. An additional 40 students were assigned 
to DOE's national laboratories and field facilities. Finally, the Dr. 
Samuel P. Massie Chairs of Excellence Program, funded by DOE, is named 
after an African-American chemist of national reputation who was a 
leader in championing the cause of minority education in the United 
States. The program now comprises nine HBCUs that graduate more than 30 
percent of the minority engineers in the United States.
                       meeting workforce demands
    The following are ways in which the federal government can address 
future energy workforce demands in the United States:
Foster Math and Science Education
    DOE's Office of Science has long been the dominant federal sponsor 
of basic research in the physical sciences, including physics, 
chemistry, and related fields. The Office of Science also supports 
computer sciences, mathematics, environmental sciences, materials 
research, nanotechnology, and engineering. These research programs are 
supported by a dedicated effort designed to recruit, train, and retain 
the next generation of Americans who are interested in science, 
technology, engineering and mathematics (STEM) careers. The Office of 
Science, through its Office of Workforce Development for Teachers and 
Scientists, currently supports more than 600 undergraduate internship 
experiences at DOE laboratories and 200 K-12 educators who work with 
master educators and mentor scientists to hone their classroom skills. 
The Office of Science, through its research grants, also supports the 
training of thousands of graduate students and post-doctoral 
researchers, and has several dedicated graduate fellowship programs in 
the physical, computer, and life sciences. The Office of Science is in 
the process of working with DOE offices--including OE--that could 
benefit from focused placements of internships and fellowships in 
dedicated research assignments of importance to the U.S. electric 
utility industry.
    In addition, the Office of Science promotes science literacy and 
interest in the STEM careers through the National Science Bowl, which 
annually attracts 20,000 middle school and high school students to 
competitions at 100 regional events located throughout the U.S., and 
other efforts. One example is DOE's annual ``Day of Science'' at the 
Oak Ridge National Laboratory in Tennessee, which this year was 
attended by more than 1,000 students from 125 universities, including 
many Historically Black Colleges and Universities. Students from across 
the country participate in scientific presentations, innovative 
technology demonstrations, and one-on-one interactions with laboratory 
researchers. Faculty from universities also participate in this annual 
event and attend workshops designed to help them understand how to 
compete for DOE research grants and participate in DOE's research 
enterprise.
Support Strategic Research in Engineering
    As noted earlier, university-based research and education is an 
engine for innovation, exploration, and ingenuity. Curricula need to 
strike an effective balance between addressing the short-term needs of 
industry and promoting the strategic research necessary to maintain 
America's long-term competitiveness. Without strong support for 
strategic research in engineering and without qualified replacements 
for retiring faculty, the strength of our Nation's university-based 
engineering programs will wane, and along with them, the foundation for 
innovation in the energy sector to meet our future challenges. We need 
to ensure adequate funding for academic programs in energy-related 
disciplines to attract the most talented students to these programs.
    For instance, the Department's funding of the Power Systems 
Engineering Research Center (PSERC), a multi-university, 
multidisciplinary National Science Foundation-sponsored center, 
develops broadly trained power engineers as well as future power 
engineering faculty candidates.
Promote Interest in Energy-Related Careers
    There are significant opportunities for creativity and innovation 
in the energy sector to meet the challenges of the 21st century. It is 
important to highlight that supporting energy infrastructure is a 
national strategic priority. Federal agencies could work with the 
private sector to communicate what the energy industry is about, to 
emphasize the high-tech nature of future challenges, to identify the 
direction the industry is moving, and to build awareness for the 
careers of tomorrow.
Capture Existing Workforce Knowledge
    Even as we grow our workforce, the loss of historical knowledge as 
the so-called baby boomer generation retires, could be detrimental to 
productivity. For instance, a shortfall in experienced lineworkers 
would create longer restoration times after a disruption. Training, 
workforce retention, and phased retirements could help mitigate any 
consequences.
Develop Cross-cutting Understanding
    An analysis of the interdependencies of the workforce across the 
entire energy flow--from coal miners and well riggers to electrical 
lineworkers and engineers--is required to ensure energy reliability 
will not be impacted by a national shortage of skilled personnel.
    The Department of Energy is partnering with the Department of Labor 
(DOL) to arrive at a better understanding of energy sector workforce 
issues. As Assistant Secretary DeRocco mentioned, the Department of 
Energy is working with DOL to fulfill the requirements of Sections 385 
and 1830 of EPACT. As you know, those sections required DOE to enter 
into an arrangement with the National Academy of Sciences to conduct a 
study on the availability of skilled workers in the energy sector. 
Assistant Secretary DeRocco's testimony further describes this effort, 
and DOE is looking forward to working with DOL and the National 
Academies.
Think Globally
    In the past, declines in the domestic science and engineering labor 
force could be compensated for by attracting the best and brightest 
scientists and engineers from around the world. However, with new 
cutting-edge research infrastructure being built overseas, and with 
strong employment prospects in several developing regions, there is 
perhaps less of an incentive for students to remain in the United 
States upon graduation. Statutory caps on high-skilled temporary work 
visas and employment-based immigration limit the number of students and 
professionals that are able to either enter or remain in the United 
States.
Conclusion
    In order to maintain our economic preeminence in an increasingly 
competitive world, U.S. industry must invest in its human capital to 
ensure the next generation of skilled personnel, scientists, and 
engineers capable of maintaining American leadership in critical 
science and technology areas as we work to meet the energy and economic 
challenges of the 21st century.
    This concludes my statement, Mr. Chairman. I look forward to 
answering any questions you and your colleagues may have.

    The Chairman. Thank you very much.
    Ms. Cornelius, go right ahead.

    STATEMENT OF ANDRA CORNELIUS, VICE PRESIDENT, WORKFORCE 
                 FLORIDA, INC., TALLAHASSEE, FL

    Ms. Cornelius. Chairman Bingaman, Senator Corker, other 
members of the committee, my name is Andra Cornelius, I am Vice 
President of Business Outreach for Workforce Florida. Thank you 
for the opportunity to provide testimony on behalf of Workforce 
Florida, the State's workforce investment board.
    We have worked very hard in Florida over the last 18 months 
to better understand the energy industry's workforce needs in 
our State. We have identified it as a critical sector, because 
of the role this industry plays in keeping our economy strong, 
and in the event of storm activity, helping us to regain 
normalcy.
    This industry, like others in our State, is facing 
workforce shortages. Since 2002, Florida has had one of the 
lowest unemployment rates, and strongest job growth rates among 
the Nation's largest States. Florida is forecast to be the 
third-largest State in the country in 2011, just behind 
California and Texas. We gain about eight to nine hundred new 
residents daily.
    While every industry is collectively concerned about where 
to find skilled talent, with this much growth, our energy 
industry will need to develop new power sources. Additional 
workers will be needed to generate, transmit and distribute 
power. Our Governor has also set very bold guidelines to ensure 
our State stays as green as possible, so we're looking ahead to 
alternative sources of power generation, as well.
    One of the steps we took toward developing solutions was to 
form the Florida Energy Workforce Consortium, comprised of all 
of our major energy partners, workforce representatives, 
educators and associations to identify workforce issues 
impacting the energy industry, including the large number of 
expected retirements. We also needed to better understand the 
existing training option in our State, and the output from our 
schools--the pipeline, if you will--and how companies are 
transferring knowledge from their existing workers to the new 
ones.
    We also needed to identify what the specific occupations of 
critical concern were, and last, to begin developing solutions 
to meet the workforce needs now and in the future.
    What are the lessons from Florida, thus far? First, build 
effective partnerships--engage industry, labor, education 
partners, and the workforce system to collectively craft 
solutions for all. Second, build a talent pipeline. Many 
companies are finding it difficult to recruit younger job 
candidates with the skills needed for success. We will need to 
replicate feeder programs, like the Gulf Power Academy in 
Pensacola, which uses company instructors and equipment, and 
conveys company values to young people while still in high 
school. This is very critical in Florida, where 6 out of 10 
ninth-graders drop out, or do not go onto college.
    The energy industry provides excellent jobs with great 
earning opportunities that can change young peoples' lives, and 
these jobs are never off-shored.
    Our Consortium works closely with the National Center for 
Energy Workforce Development. This Center has a ``Get Into 
Energy'' website, among other tools, to foster career 
awareness.
    Finally, in addition to partnerships and deploying pipeline 
development strategies, we are implementing policies that will 
allow us to meet new challenges related to increasing energy 
demand, both traditional and alternative.
    Florida's experience leads us to believe that any national 
solutions for addressing this industry's workforce challenges 
should take into account three things.
    First, make the energy industry workforce development 
effort, and economic development priority. Reliable power is 
the backbone for any growing economy.
    Second, focus on talent pipeline development and career 
awareness, support programs like the Gulf Power Model that 
emphasize skills with documentable results.
    Third, align investments for solutions through partnerships 
to reduce redundancy and leverage funding.
    Chairman Bingaman, this concludes my remarks, I want to 
thank you again for this opportunity to testify before this 
committee.
    [The prepared statement of Ms. Cornelius follows:]

   Prepared Statement of Andra Cornelius, Vice President, Workforce 
                     Florida, Inc., Tallahassee, FL
                              introduction
    Chairman Bingaman, Ranking Member Domenici, and other distinguished 
members of the Committee: My name is Andra Cornelius, CEcD, and I am 
Vice President of Business Outreach for Workforce Florida, Inc. I am 
honored to have this opportunity to appear before you today on behalf 
of Workforce Florida, the state's workforce investment board. As such 
Workforce Florida is charged with fulfilling responsibilities outlined 
in the federal Workforce Investment Act. Working with the Florida 
Agency for Workforce Innovation and 24 regional workforce boards 
throughout the state, Workforce Florida's mission is to develop our 
state's business climate through strategies that help Floridians enter, 
remain and advance in the workforce, becoming more highly skilled and 
successful, benefiting our enterprises and the entire state. Our 
success at strengthening Florida's economy also boosts our national 
economic outlook.
                  florida workforce system background
    We are very proud of the accomplishments of Florida's public 
workforce system, which has been recognized as a national model for its 
innovative solutions to meeting workforce needs. The system was 
restructured in 2000 to create Workforce Florida, which is a nonprofit, 
public-private partnership. What makes our system unique is that a 
majority of Workforce Florida's Board of Directors represents Florida 
businesses and this workforce investment board is empowered to set 
policy by directing the appropriated resources. This ensures Florida's 
workforce system remains demand-driven and flexible to meet needs in an 
ever-changing economy. The Florida Agency for Workforce Innovation is 
our state-level partner and it is charged with administrative oversight 
of the regional workforce boards, governing compliance and providing 
technical assistance. At the local level, where most of the service 
delivery occurs, the also business-led regional workforce boards direct 
programs and resources for businesses and job seekers that are tailored 
to meet each community's unique needs.
    In my testimony today, I seek to address the intent of this hearing 
by providing a state workforce investment board's perspective on 
whether our Nation's energy industry will have the available workforce, 
both craft and professional, to meet growing needs and whether gaps 
exist that Congress should act to address. In doing so, I would like to 
speak to what Florida's workforce system has done over the past 18 
months to better understand the energy industry's workforce needs in 
our state, our accomplishments to date, and the challenges and 
opportunities we believe are ahead in implementing lasting workforce 
solutions for this vital sector. Finally, I would like to offer a few 
suggestions for this committee to consider as you continue to develop 
strategies in this critical area. Simply stated, I would like to share 
with you the three P's we have learned are essential in order to meet 
existing and future workforce challenges facing Florida's--and our 
Nation's--energy sector. They are: partnership, pipeline and, your 
influential role, policy.
                       creating new partnerships
    Developing lasting workforce solutions requires partnerships among 
industry, education, economic development and workforce. Across the 
Nation, our workforce systems are challenged to provide services within 
the reality of a global economy. Prosperity in the New Economy requires 
a highly skilled and productive workforce. Improving the skills of our 
Nation's workers to meet technological advances and support economic 
expansion has been identified as one of the most pressing needs facing 
our communities today. That need holds true too for the energy 
industry. Florida's energy industry is made up of a diverse mix of 
electric companies: investor-owned utilities, municipals and rural 
cooperatives. These companies employ about 26,350 people statewide, 
often in well-paying jobs that exceed the state and national annual 
average wages, but I'll discuss this more a bit later. Our state is 
fortunate that our economic outlook has remained strong with low 
unemployment and, though slowing, continued job growth. With a labor 
force of more than 9.2 million, Florida's 4 percent unemployment rate 
in September 2007 was below the national rate of 4.7 percent. Our 
state's unemployment rate has been below the national average since 
mid-2002 and based on nationwide data the September rate was the lowest 
of the 10 most populous states. Simultaneously, Florida ranked third in 
job growth among the most populous states, behind Texas and California, 
with an employment growth rate of 1.3 percent in September, 
representing 105,700 new jobs over the same period a year ago. The 
statewide job growth rate was slightly higher than the national job 
growth rate of 1.2 percent for September. Still, as our Governor 
Charlie Crist has proclaimed: We in Florida are not just focused on 
creating jobs, but good jobs that lead to a better quality of life for 
Floridians and keep our economy strong.
    Our state workforce investment board has chosen to direct Florida's 
mostly federal funding for workforce development to programs and 
services that lead to high-skill, high-wage employment and advancement 
opportunities in high-value industries. These are targeted industries 
that drive our regional and state economies, thus aligning with our 
state's economic development plan. It's only recently that the energy 
industry has become one of those workforce development targets, 
contributing to Workforce Florida's leadership role last year in the 
formation of the Florida Energy Workforce Consortium (FEWC), which is 
one of the key collaborative efforts I wish to discuss today. I must 
say too that in creating this consortium we had some extraordinary 
motivation.
                  understanding energy workforce needs
    You likely remember the four uninvited visitors to our state in 
2004: Hurricanes Charley, Frances, Ivan and Jeanne. Hurricane Dennis 
followed them in 2005. In the wake of the destruction of each of those 
storms, our utilities were essential in the rapid recovery of our 
businesses and citizenry. Line technicians were literally our heroes. 
They restored our power enabling us to get our businesses and our lives 
back in order. Prior to these storms, the energy industry was never one 
of Florida's economic development targets--in other words, it was not 
an industry we actively recruited, expanded or retained. However, after 
the series of storms, we realized just how vital this industry is to 
our state's economic stability. We knew we needed to begin our outreach 
by hearing from our industry partners, so we asked colleagues at Gulf 
Power Company and Progress Energy to help us get started and to ensure 
we had all of the major players at the table.
    Formed in April 2006, the consortium seeks to identify and develop 
solutions to meet the needs of the utility industry in Florida. The 
consortium is comprised of representatives from energy companies and 
associations, the workforce system, secondary and post-secondary 
educational institutions, labor organizations, and the national Center 
for Energy Workforce Development (CEWD). I'll discuss more about the 
national center's role and support later too. Interestingly, all of 
Florida's investor-owned utilities are at the table and have been from 
the beginning. This is noteworthy because these companies traditionally 
are seen as strong competitors who keep collaboration at a minimum, but 
their mutual need for skilled talent brought them to the table and is 
driving their participation in the consortium, which now has more than 
50 members. The consortium's primary goals are to:

   Identify workforce issues impacting the energy industry in 
        Florida, including the large number of expected retirements 
        with few prepared workers to replace them.
   Better understand existing training options as well as to 
        identify opportunities to transfer knowledge from the existing 
        workforce to entry-level workers.
   Bolster labor market projections about future energy 
        workforce needs--by occupation--with real-time utility company 
        validation and to prioritize those occupations by critical 
        need.
   Develop a three-pronged approach to energy industry talent 
        development. First by growing our own skilled workforce 
        deliberately focusing on youth and career awareness of 
        occupations in the industry. Second by attracting suitable 
        workers from previously untapped or under-tapped labor pools. 
        Finally by re-training workers from other industries who can 
        transition into in-demand energy sector occupations.

    As the consortium got to work, energy companies brought to our 
attention that it's not just more line technicians who are needed to 
help keep the power flowing to businesses, residences, schools, 
hospitals, and elsewhere, but also power plant technicians, maintenance 
staff at plants, plant construction crews, and many others. Perhaps one 
of our industry partners best summed up the driving force that has led 
to this unprecedented effort in Florida to seek solutions to energy 
sector workforce needs when he said, ``We can continue to compete for a 
talent puddle or work to create a talent pool.''
    Before we could begin to identify ways to create this pool, we 
needed to better understand the current and future energy and workforce 
demands. Growth, of course, is at the top of this list. By 2011, 
Florida is on target to become the third most populous state behind 
California and Texas. By 2020, our state's population is expected to 
top 23.5 million Floridians. We are by no means alone. Our Nation's 
population is projected to increase to more than 419 million by 2050, 
according to the U.S. Census Bureau. Today and closer to home, the 
Southern states account for 38 percent of the U.S. population--with 
growth in the region outpacing national growth. Almost everyone uses 
power or needs it, so demand will continue to soar as will the need for 
additional infrastructure to generate, transmit and distribute power. 
According to the Florida Public Service Commission, more than 73 
percent of energy in our state is generated from fossil fuels and 
nearly 12 percent comes from nuclear energy. Renewables account for 2 
to 3 percent, but under the policies being developed and implemented 
under the leadership of Governor Crist, who is also a member of the 
Workforce Florida Board of Directors, we expect this percentage to 
increase. Meanwhile to meet projected power demand, energy companies 
have indicated to the Florida Public Service Commission their interest 
in bringing online up to 18 new fossil fuel units by 2015 as well as 
two new nuclear units beginning in 2016.
    Additional major issues affecting the industry's workforce in 
Florida, and other states, include the aging power delivery networks 
that will have to be replaced; the restructuring of companies due to 
deregulation in the 1990s that led many utilities to cost pressures and 
cost reductions, especially associated with hiring, training and 
retaining skilled craft workers; new technology; and the anticipated 
wave of retirements as more than half of the industry's workers 
nationwide, such as line technicians and power plant operators, are 
scheduled to retire in the next five to 10 years. These challenges 
along with the limited current pipeline for entry-level workers have 
led to a perfect storm. Unless we undertake long-term solutions to 
expand the energy sector workforce, we'll face exceptional challenges 
to keep our lights on.
    A national Black & Veatch Electric Utility Industry Survey released 
about a year ago found that replacing the aging workforce was the No. 1 
issue of concern cited by municipal power companies and the No. 3 issue 
identified by investor-owned companies. Other issues at the top of the 
list were infrastructure and reliability. The North American Electric 
Reliability Corporation (NERC) in its 2007 Survey of Reliability Issues 
found that ``the aging workforce and lack of skilled workers'' is 
ranked first among all business issues, with the highest likelihood and 
highest impact on reliability. In a Florida survey, 75 percent of the 
state's electric companies cited the accelerated pace of retirements as 
a chief concern. Failing to maintain the skills of today's workforce by 
replacing retiring workers with competent substitutes, by training and 
re-training workers to keep pace with technological changes, and by 
capturing and transferring knowledge more effectively could affect the 
quality of service to consumers in Florida--and across the Nation--and 
impact the sustainability of economic development going forward. A 2006 
U.S. Department of Energy study also found that ``the loss of 
institutional knowledge is a critical concern, especially for a 
profession heavily dependent on mentoring and on-the-job training.'' 
Several of Florida's investor-owned utilities have formal knowledge-
transfer initiatives in place for this very reason. One Florida company 
has surveyed its employees asking them to characterize their knowledge. 
Full certainty means they know how to do their job and why they do it. 
Partial certainty means they know how, but not why and conditional 
certainty indicates they don't know how or why, but are willing to try. 
On average, only half of the utility's operations and maintenance 
employees report ``full certainty'' of the required skill sets for 
their position. How problematic would it be to continue production with 
skilled talent exiting their workforce with only half reporting they 
have full knowledge of the required skill sets?
                     high-demand job opportunities
    With an understanding of how such critical issues affect the 
workforce in power operations and energy delivery now and in the 
future, the consortium turned to identifying the jobs in which skilled 
employees are most needed by our utilities, which not surprisingly 
mirror critical occupations of other utilities in the Southeast. What 
are they? In energy delivery, they are line technicians and substation 
technicians. In power operations, they are electricians, instruments 
and controls technicians, welders and power plant operators. This list 
of in-demand occupations also is nearly identical to a nationwide list 
compiled by the Center for Energy Workforce Development. The center 
also is beginning to focus more attention on the national need for 
engineers to support this sector. In fact, a 2007 Center for Energy 
Workforce Development survey found that among participating companies 
about 46 percent of employees in engineering jobs could retire 
beginning in 2012. I mentioned the center earlier and its support of 
our efforts in Florida. Ann Randazzo, the center's director, has been 
an active participant in our meetings. The national center is a 
nonprofit consortium of electric, natural gas and nuclear utilities and 
their associations. It was formed about the same time as our Florida 
Energy Workforce Consortium and the center's research and advocacy on 
behalf of the workforce needs of this sector have been invaluable to 
us.
    I can't underscore enough how critical the partnership among 
industry, education, economic development and workforce is in creating 
and sustaining a pipeline for skilled energy workers. The Florida 
success story would be incomplete without examining the actions taken 
by the industry to not just await a government solution, but to create 
programs and partnerships to begin to address their own needs. Florida 
energy companies such as Gulf Power, Florida Power & Light, Progress 
Energy, Ocala Electric Utility and Sumter Electric Cooperative (SECO) 
have initiated partnerships and created pipeline programs with 
secondary and post-secondary schools.
    A challenge for the industry in recruiting students to participate 
in programs such as these is raising awareness about rewarding career 
opportunities in the energy sector. To recruit the desired workforce, 
companies will have to change their public image from one which is 
static to one which is more dynamic, offering challenging careers in an 
exciting industry. Creating awareness of jobs is essential and we can't 
rely on high school guidance counselors to do it for us. If we are to 
build a pipeline of skilled talent, we need to convince young workers 
that the industry is a desirable one to work for. They must understand 
the industry produces a commodity that is essential to society and to 
our quality of living. They also must be taught that those who work in 
the industry are environmentally responsible and that the jobs are 
stimulating and pay well. The Center for Energy Workforce Development 
has developed a website, GetIntoEnergy.com, which acquaints young 
people with jobs in the industry. The website provides career 
assessment, determining what job suits you; it also offers a career 
quiz, salary comparisons, and allows you to view videos of the actual 
work and people doing it. It outlines the skills required for key 
occupations as well as education requirements and where you can go to 
get that education. One of the early projects of the Florida Energy 
Workforce Consortium was to identify all school-based energy training 
options in our state and to make that information available on this 
site. Industry job listings for Florida and other partner states also 
are posted on the site.
           focusing on secondary education pipeline programs
    When we do engage young people who are interested in energy careers 
the connection is a powerful one. In North Florida, Gulf Power began 
its first academy in Pensacola at West Florida High School of Advanced 
Technology in the summer of 2001. It did so to develop a feeder pool 
for critical jobs such as entry-level power generation and power 
delivery positions as well as degreed positions such as engineers. The 
popular program now has expanded to two other high schools, Laurel Hill 
School in Laurel Hill and Locklin Tech in Milton. Gulf Power employees 
hold formal interviews for those students seeking entry into the 
academies. The curriculum is focused on industrial electricity and the 
electrical utility industry. Instructors use the National Center for 
Construction Education and Research (NCCER) electrical curriculum. In 
the Gulf Power program, every 11th grader is paired with a Gulf Power 
mentor who is in a career of interest to the student. Seniors who meet 
school criteria are placed in the Advanced Career Experience (ACE) 
program where they report to Gulf Power on alternating days during 
school hours for completion of their curriculum requirements and work 
opportunities. Graduates of this high school program earn 15 hours of 
college credit and a nationally recognized NCCER industry credential. 
Many of the graduates are now employed by Gulf Power. Also critical to 
the success of any program is public accountability and the outcomes. 
Gulf Power uses the Edison Electric Institute pre-employment tests as a 
condition of hiring. In the most recent graduating class from the power 
academy program, the exam passage rate was 100 percent, compared to an 
average passage rate of 40 percent for general test-takers. The West 
Florida High School program has produced 62 graduates. Of those, 20 
have been hired by the company into entry-level positions, 10 went to 
work for other utilities or related companies, 26 enrolled in college, 
two went into the military and four are in the Gulf Power pre-
employment process.
    For a more personal peek at the effectiveness of the Gulf Power 
Academy program at providing opportunities for a brighter future for 
students as well as utility companies, consider the experience of Ron, 
though I've changed his name to shield his privacy. Ron was initially 
disqualified from participating in the ACE program during his senior 
year because of excessive tardiness to school. Program leaders later 
learned his tardiness was attributable to an unstable home life. Ron 
had a turbulent relationship with his parents and feared for his 
personal safety because his father struggled with alcoholism. Ron had 
often been late to school because he was homeless for a period 
alternately living in his truck, spending the night with friends or 
sleeping in parks. Despite this hardship, he continued to come to 
school and after opening up about his difficulties, Ron appealed his 
ineligibility to participate in the ACE program. Following his appeal, 
Ron was accepted into the ACE program and successfully passed Gulf 
Power's preemployment tests earning praise from the utility company's 
employees for his eagerness to learn, respectfulness and engaging 
personality. When Ron graduated from high school he was offered a job 
as an apprentice line technician and he began working for Gulf Power 
shortly after turning 18. Just over a year after completing the Gulf 
Power Academy and graduating from West Florida High School, Ron closed 
on a three-bedroom, two-bath home and is well on his way in his career 
at Gulf Power. From homeless to homeowner, Ron through his experience 
exemplifies how relevant training and support from professionals in an 
industry with great earning opportunities can change your life.
    In Miami Dade, Florida Power & Light has joined with Miami-Dade 
County Public Schools to create a two-year, dual-enrollment high school 
apprentice program to train future line specialists. The first class of 
nine graduates completed the program earlier this year. In Central 
Florida, Progress Energy and other utilities are working with CLM 
Workforce Connection, the local workforce investment board in this 
region, as well as the school districts in Citrus, Marion and Levy 
counties, in a recently opened power industry academy modeled after the 
Gulf Power program in North Florida. Workforce Florida awarded two 
grants totaling about $157,400 to support launching the new program 
that will train high school students and provide a pathway for careers 
as utility electricians, electrical engineers and electrical 
contractors. The Central Florida academy is taking aim at preparing 
students for jobs in anticipated, new power-producing plants in the 
region. Eighty students have signed up for the program, which also is 
modeled after Florida's CHOICE career academies. Part of what makes all 
of these programs such tremendous successes is that they emphasize 
industry certifications. Participants graduate not only with high 
school diplomas, but also with industry-awarded credentials and often 
college credits, at no additional charge to students or their parents. 
These certifications demonstrate the students are work-ready and 
prepared to step into good paying jobs or to continue their education 
in a postsecondary setting.
    In fact, these career academies--and others like them in our state 
that prepare students for careers in industries such as aviation, 
manufacturing, information technology, construction and health 
sciences--use rigorous and relevant industry-endorsed curriculum. They 
also represent a major transformation in career and technical education 
in Florida in part thanks to a new state law, the Career and 
Professional Education Act, which will lead to similar high school 
academies in every Florida school district to train students for 
careers in energy and other sectors that help drive regional economies. 
In our state, the work to create the CHOICE model of career and 
technical education and the new law that codifies this blueprint was 
led by state Senator Don Gaetz, a businessman and former superintendent 
of the Okaloosa County School District. Florida's workforce system was 
at the table from the beginning helping to shape the CHOICE programs 
led by Mary Lou Reed, executive director of the Workforce Development 
Board of Okaloosa and Walton Counties. Workforce Florida has awarded 
more than $5.1 million in grants statewide since 2005 for initiatives 
to replicate and support CHOICE-model career academies. Why is this 
important? Again, each CHOICE program is created through partnership 
with education, workforce, economic development and industry and 
provides excellent choices for future career paths whether it's a head 
start on college with credits already in hand or skills that allow 
students to enter the workforce qualified for higher wage jobs. Such 
preparation is critical in Florida where six out of 10 ninth graders 
either drop out of high school or don't go on to college even if they 
finish high school. The energy sector, as we know, is among the 
industries that have an abundance of well-paying job and career 
advancement opportunities that do not require college degrees. In 
Florida last year, the average annual wage for electrical power line 
installers and repairers was $52,956; for power plant workers, $59,217; 
and for first-line supervisors of mechanics, installers and repairers, 
$64,480. The state annual average wage for all industries was about 
$38,500. The national annual average wage for all industries was 
$42,535.
        expanding the `pool' through post-secondary initiatives
    Beyond our efforts in growing talent at the secondary level, 
Florida energy companies also are taking action to forge stronger 
partnerships with post-secondary institutions to train and re-train 
energy workers. For example, Florida Power & Light, our state's largest 
utility company serving 4.4 million customer accounts, has strong 
partnerships with Miami Dade College and Indian River Community College 
for post-secondary training programs, particularly for nuclear 
technicians. Among Florida's newest workforce initiatives are Employ 
Florida Banner Centers. These centers, mostly based at Florida 
community colleges, are charged with developing new, cutting-edge 
training with industry input that is portable and can be delivered 
throughout the state by other community colleges, universities, 
vocational technical centers, private training providers and others. 
These centers also provide training to entry-level and advanced workers 
and serve as a clearinghouse for companies and job seekers in their 
targeted industry. Workforce Florida has awarded $8.8 million in grants 
to support this e3 (employment, education and economic 
development) initiative. Two of the 12 new Banner Centers are 
designated in energy and alternative energy, based in part on the 
workforce needs identified by the Florida Energy Workforce Consortium. 
The Employ Florida Banner Center for Energy got under way this past 
spring at Lake-Sumter Community College. It builds on the college's 
existing six-week pre-apprentice boot camp program that orients those 
interested in becoming line technicians with the demanding work. It 
also provides skills upgrade training for incumbent workers. In fact, 
before the consortium got under way (and later the new Banner Center 
for Energy), many of our utilities were recruiting line technicians 
from North Dakota, South Georgia, and Puerto Rico, while unaware of the 
home-state resource available right there at Lake-Sumter Community 
College. The lead instructor for Lake-Sumter's program is Bill Tyler--a 
42-year veteran of the line-worker trade. Under the Banner Center for 
Energy initiative, Lake-Sumter Community College also has partnered 
with Indian River Community College to increase training opportunities 
and develop new curricula for power plant workers, expanding the work 
of Indian River's existing Power Plant Technology Institute. The Banner 
Center for Energy's advisory council is made up of key organizations 
and companies represented in the Florida Energy Workforce Consortium 
including the Florida Electric Cooperative Association, Florida 
Municipal Electric Association, Florida Power & Light, Gulf Power, 
Progress Energy, Jacksonville Electric Authority, Orlando Utilities 
Commission, Lakeland Electric, SECO and TECO Energy. In its first four 
months of offering training, the Banner Center trained 118 incumbent 
and entry-level workers in line specialist skills, directly helping at 
least 16 of the 18 or so people who were being introduced to the 
profession find employment in the industry.
    In Florida, we're also beginning to examine more closely the need 
to fill critical professional positions such as in engineering that 
require post-secondary degrees. We have learned through the consortium 
that demand for engineers varies among utility companies. We also know 
that with the number of new plants on the drawing board the need for 
professional staff will grow. One area that we have identified through 
the consortium that needs attention is strengthening articulation 
agreements between our secondary career academies and post-secondary 
institutions (both community colleges and universities). Workforce 
Florida also has worked with the Florida Energy Commission on its 
recommendations to the Florida Legislature on strategies to secure the 
state's energy future. Not surprising, one of the commission's 
recommendations is that Florida establish an Electric Power Institute 
within the state university system to concentrate on both undergraduate 
and graduate training in fuels, power technology and management. The 
workforce system has traditionally focused on short-term training, but 
it's critical that we fortify the link with our higher education 
partners to ensure the highly skilled engineers and other professionals 
required by the industry are produced in Florida and, more importantly, 
stay in Florida. Our higher education partners also play a critical 
role in the mounting focus on research and development as our state's 
energy policies increasingly expand beyond today's power production 
technologies.
    The new Banner Center for Alternative Energy based at the 
University of Central Florida and the Florida Solar Energy Center, for 
example, will help ensure our state has a workforce that is equipped to 
seize upon opportunities created through renewable energy sources. This 
mission is consistent with the greener direction our state is headed 
led by Governor Crist, who during his first year in office has set 
Florida on a bold path to diversify our energy resources and reduce 
greenhouse gas emissions.
           linking energy companies with qualified candidates
    Another way in which our workforce system helps to expand the 
talent pool for this sector is by bridging the divide between employers 
and qualified job candidates. Key to our comprehensive strategies for 
meeting the energy sector's demand for skilled talent is linking 
Florida companies with job seekers both through the job-matching 
services offered through Florida's nearly 100 one-stop centers and 
through our powerful online tool the Employ Florida Marketplace on the 
Web at EmployFlorida.com. The Marketplace website receives 3.85 million 
hits and has about 48,800 unique visitors daily. On it you will find 
registered 2.9 million job seekers and 159,000 employers seeking to 
connect with one another. On any given day, the site has about 285,000 
job listings, including those from Florida utilities, posted on it. 
There are also 406,000 resumes currently available there.
    We also have professional workforce experts in our one-stop 
centers, who are dedicated to helping sometimes untapped or under-
tapped groups such as veterans. In fact, veterans represent a strong 
talent pool for the energy sector. We are all familiar with the many 
benefits of hiring veterans such as their leadership skills, ability to 
perform under pressure and penchant for working as a team. They also 
receive some of the best training while in the military and, if they 
weren't when they joined, they are tech savvy when they leave. To 
illustrate just how important the workforce system's role is in 
bringing companies and job candidates together allow me to briefly 
share the story of Gabriel Johnson.
    Mr. Johnson was a nuclear-power-trained Machinist Mate Chief Petty 
Officer (E-7) who, as a single parent, decided to get out of the Navy 
to raise his two young children. He registered at the Fort Pierce One 
Stop Career Center for assistance with finding a job and had expressed 
an interest in working for Florida Power & Light at its nuclear energy 
plant in South Florida on Hutchinson Island. He applied online through 
Florida Power & Light's Web site as well as expressed interest in 
nuclear plant jobs in other states. He was mulling an offer in Nebraska 
when Larry Sowers, the regional veterans' program coordinator in the 
Fort Pierce one stop, reached out to a Florida Power & Light human 
resources manager, who had previously indicated her company's keen 
interest in recruiting veterans for employment openings. That 
intervention led to a job interview for Mr. Johnson, who was offered a 
maintenance supervisor position with a $75,000 annual salary. This 
experience also demonstrates our system's commitment through our 
workforce partners, such as the Fort Pierce One Stop Career Center 
under the Workforce Development Board of the Treasure Coast, to 
retaining our best talent in Florida to meet the employment needs of 
our key industries.
           what's ahead: building a national policy blueprint
    From creating new partnerships such as the Florida Energy Workforce 
Consortium to developing pipeline programs like the career academies 
and Banner Centers to leading through policy-setting as Workforce 
Florida has done in recognizing the energy sector as vital to our 
economic future and investing resources accordingly, we've indeed made 
significant progress in our state toward ensuring we have the reliable 
power resources needed to sustain our quality of life as well as our 
economic prosperity. Yet, we also recognize that more work remains 
ahead. Where do we go from here? How do we build lasting solutions for 
what will be long-term challenges in meeting the demanding workforce 
needs for the energy sector? How do we move this workforce from a 
puddle to a pool? We'll continue to build on the strategies that I 
outlined today and seek new ones through our collaborative efforts. The 
momentum of our early success at building new bridges through our 
Florida Energy Workforce Consortium has led us to plans for our first 
statewide summit on the energy workforce in February 2008. We'll use 
this opportunity to assess our progress, set short-term and long-term 
goals and initiate plans to get us there. Additionally, we plan to 
invite some new partners to join our efforts by expanding membership in 
the consortium to include contractors, their associations, and labor 
organizations that provide contract labor that is essential to efforts 
at maintaining and increasing our energy infrastructure through both 
construction and operations. In Florida's experience are lessons and 
strategies that can be replicated to address the national scale of 
workforce challenges presented by our country's increasing energy 
demand--both traditional and alternative. That experience leads us to 
believe that any national solutions to ensuring we have a reliable 
workforce to provide reliable power resources should take into account 
the following three things:

          1) Make the energy industry workforce development effort an 
        economic development priority. This is paramount because 
        reliable power is essential to both our quality of life and 
        business operations and it is the backbone for any growing 
        economy.
          2) Focus on talent pipeline development and raising awareness 
        about career opportunities in the energy sector. A key point 
        worth remembering is that many of the in-demand jobs for this 
        sector such as line workers, power plant mechanics and 
        electricians are positions that are never, ever off-shored. 
        Programs aimed at producing more entry-level talent should 
        emphasize skills attainment with documentable results. That is, 
        industry-recognized certifications awarded as a result of 
        training as productive outcomes.
          3) Align investments in solutions through partnerships to 
        reduce redundancy. Ensure that government, industry and labor 
        are all involved in developing this critical workforce. To 
        accomplish this, encourage collaboration among companies, 
        educational institutions, agencies, and nonprofit 
        organizations, which are empowered to craft solutions with the 
        urgency to drive results. Also maximize limited public funding 
        with leveraged private sector dollars.

    Finally, in doing these three things, remember the three P's that 
are essential to effecting lasting solutions: partnership, pipeline and 
policy.
    I would like to thank Ann Randazzo, Mary Lou Reed, Jennifer Grove, 
of Gulf Power, and Adriane Glenn Grant, of Workforce Florida, for their 
assistance in preparing these remarks.
    Chairman Bingaman, this concludes my testimony on behalf of 
Workforce Florida. I want to thank you, this entire Senate Committee on 
Energy and Natural Resources and your outstanding staff again for our 
state's participation in this hearing on this critical issue. I welcome 
any questions that you may have.

    The Chairman. Thank you very much, let me ask a couple of 
questions and then defer to my colleagues here.
    You know, one thing that occurs to me in hearing the 
witnesses so far is that we have efforts going on at the 
Federal level to assist with this type of training, or training 
of people for this group of industries, out of several 
departments--Department of Labor, Department of Energy, 
Department of Education, maybe others, that I can't think of 
right now. To what extent is that coordinated? To what extent, 
in making a decision as to what you will support, in the 
Department of Labor, to what extent do you, are you aware, and 
do you take into account what is being done by other 
departments?
    Secretary DeRocco, why don't you answer that?
     Ms. DeRocco. Certainly, Mr. Chairman. I will tell you that 
coordination among Federal agencies engaged in education and 
job training in any sector, but particularly in energy, in the 
past has not been well-coordinated, we have known little of 
what each other has focused on. Our WIRED initiative has 
offered us the opportunity to build a partnership among 12 
Federal agencies, engaged in supporting the development of 
talent in sectors of the economy that are creating jobs and 
assuring economic prosperity.
    In that engagement, we have found that there is a 
duplication of effort, and it is critically important for us to 
institutionalize some ways in which the investments across the 
Department of Labor, the Department of Education, in the case 
of energy, the Department of Energy, the National Science 
Foundation, interestingly, the Department of Defense--all of us 
are engaged in some level of investment, and encouragement of 
stem education, workforce development and technology skills 
development across multiple sectors in our economy.
    The Chairman. So, do I take it from your answer that there 
is a group now that actually tries to do this coordinating, or 
is that just something that's planned, or what?
    Ms. DeRocco. No, there currently is a group of 12 Federal 
agencies engaged through this specific initiative, the WIRED 
initiative, that is working in 39 regional economies across the 
country. But, from an institutional basis, there is no current 
institutionalized engagement across the agencies for, for 
example, the energy sector, when it's not specific to a 
regional economy. We need to do that.
    There is an example underway in the aerospace industry 
which, by law, Congress called for an interagency taskforce on 
the future of the aerospace workforce, which has engaged 
agencies that are developing the talent to support the 
aerospace industry in a very formal way. Now, in the energy 
arena, we are partnering in an informal way.
    The Chairman. Ms. Hoffman, did you have a comment on any of 
that?
    Ms. Hoffman. Mr. Chairman, I would agree that we need to 
have better coordination among the Federal agencies.
    Within the Department of Energy, our activities focus on 
research and university-level educational programs to continue 
to sustain long-term funding for faculty development, as well 
as student development. We do have efforts with DHS and DoD 
that are definitely an opportunity for dual-use technologies. 
We have interagency agreements with the National Science 
Foundation to conduct workshops, and in fact there is a 
workshop on November 28 and 29 to look at workforce issues. 
There is also a potential to work with USDA through the Rural 
Electric Service.
    So, I do believe that there is an opportunity that we could 
do better coordination.
    The Chairman. Ms. Cornelius, let me ask you, I know we've 
talked a lot about how you need to stay in close touch with 
industries to identify the needs and all----
    Ms. Cornelius. Yes.
    The Chairman [continuing]. How does what you're doing there 
in Florida relate to union apprenticeship programs?
    Ms. Cornelius. IBEW sits on the Consortia, J.B. Clark, 
State-level IBEW representative is a very important part of our 
Consortia.
    Again, sir, we need to have everyone at the table, whether 
it be through traditional apprenticeship models, or through 
new, creative, innovative training models--we need to do all of 
it because of the need, the need is so great in our State.
    We had a study done by our Florida legislature back in June 
2002 that took a hard look at our State apprenticeship models, 
and regrettably, we found that there was much more that needed 
to be done to align the critical occupations in our State, 
particularly in construction, with our traditional 
apprenticeship models.
    We're intending, at our very next Consortium meeting to 
have an overview, again, of the apprenticeship models to find 
out where we can develop better linkages, and in addition to 
what my colleagues here have said, we must--we need to align 
resources, we need to build upon traditional training sources, 
and look to new ones as well, to meet the need.
    The Chairman. All right, Senator Corker, go right ahead.
    Senator Corker. Mr. Chairman, I just, I do want to 
reiterate the point you made about coordination. I think that 
we have a tendency in government, everybody gets excited about 
a particular issue, every department has to do it, every 
Senator has to be involved on the committees that they're on, 
and I hope that we can work together to really focus these 
efforts.
    What is happening at the college level right now? I 
remember, a long time ago, that much of what students focused 
on was sort of what was the cool thing to do at the time, is 
there much focus on the university level right now on causing 
people to have the background, if you will, moving into 
industry that is focused on energy?
    Ms. DeRocco. I would be glad to comment on that, Senator.
    We certainly have found, particularly the State 
universities and land grant colleges, becoming much more deeply 
engaged, returning to their mission, so to speak, of economic 
development within their regional economies, and thus becoming 
much more engaged with us at the Department of Labor in 
assuring a connection to the employers within those regional 
economies, the growth sectors of the economy, an understanding 
of where jobs are being created, and tailoring curriculum, more 
specifically, to meet the requirements of the job market, post-
graduation.
    I know through our partnerships with the Department of 
Energy and the National Science Foundation, we are also 
engaged, certainly, in the energy sector in assuring the 
highest level graduate degreed engineers, scientists, 
mathematicians that are needed to guide that first part of the 
innovation life cycle in energy, are seeking an engagement by 
the industry to both define their jobs, their career 
opportunities, and to make better connections with the 
industry.
    Senator Corker. Yes, ma'am?
    Ms. Hoffman. Senator, I just would like to provide a couple 
of comments. First, I think we need to continue to stimulate 
the high school level so they engage into education in the 
engineering field. We need to get our high school students into 
science and mathematics and get their abilities in science and 
mathematics to the level that's required for engineering 
colleges and universities.
    Second, I do believe that there is still a momentum to the 
popular-type college programs. One thing that we should do is 
to start promoting engineering and emphasizing the high-tech 
nature of the industry, whether it's the electrical industry 
with smart grids, or whether it's the oil and gas industry with 
wired oil fields, and build momentum in gaining some students 
back in those fields.
    Senator Corker. Which areas of the energy sector do you 
think we have the most critical shortages right now, that are 
going to affect us in the most immediate future?
    Ms. Cornelius. I'd be happy to respond to that, Senator 
Corker.
    Senator Corker. OK.
    Ms. Cornelius. Line technicians is an area that we've been 
very, very concerned about in Florida, with an estimated half 
of the line technician workforce to be retiring in a 5-year 
period.
    We're also very concerned about power operators, 
electricians, welders that will be needed to maintain our power 
sources today, but then looking ahead to new sources of power 
generation.
    But, if I were to identify the top three, clearly line 
technicians, welder, plumber/pipe fitters, and power plant 
operators.
     Ms. DeRocco. I would like to add to that, if I may, 
according to the outreach we've made to all sectors of the 
energy industry now, it appears we also need a significant 
focus on the future of our nuclear industry, the industry is 
projecting that they're going to need 21,000 new workers to 
build new plants, and new plant capacity--this goes to the 
skilled crafts and trades that this Nation is seriously facing 
a shortage of--5,000 new workers to operate the potential 
nuclear energy plants currently in the application process, and 
25,000 workers to replace retiring skilled workers today.
    So, in addition to the utility occupations that my 
colleague has emphasized, we are focused very much on the 
nuclear sector.
    Alternative energy--a growing opportunity in so many 
regional economies across our country is now defining new 
competencies and skills that their workforce is going to need, 
so that's an opportunity for workers, and also an opportunity 
for our economy to grow.
    Senator Corker. I think the answer to the next question is 
self-evident, but climate change legislation would affect the 
industry, how? From a standpoint of any comments about the 
meeting needs in the future if climate change legislation were 
to come to fruition?
    Ms. DeRocco. I'm not sure we've done a national assessment, 
I would defer to my colleague from the Department of Energy, 
but it is clearly the emphasis on climate change issue I think 
that is spurring a lot of interest in the alternative, or green 
energy sources, and the opportunities for biofuels development, 
and alternative energy plants and operations growing all across 
the country--ranging from wind to solar to other green energy 
alternatives as well.
    A whole new set of competencies and skills, a whole new 
need for curriculum and education and training opportunities 
for America's workers.
    Ms. Hoffman. I would agree with Assistant Secretary 
DeRocco, that with the growth in alternative energy there are 
solar, wind, and the technology opportunities there for that 
sector.
    I would also comment that, in engaging the university and 
power plant operators, we need to get folks up to speed on the 
new technologies that are coming out with respect to climate 
change--carbon sequestration and advanced nuclear 
technologies--so that we can actually educate the workforce to 
be on top of where we're heading in the future with our 
technology advancements.
    Senator Corker. Thank you, Mr. Chairman.
    If I could have one point of----
    The Chairman. Sure.
    Senator Corker. What does a line technician make in 
Florida, just so you can advertise on C-Span?
    Ms. Cornelius. Fifty-three thousand dollars a year. The 
average wage in Florida is about $35,800. With overtime--which 
is not unusual with line technicians, they can make up toward 
six-figure salaries.
    The Chairman. Senator Corker, that's what you make, a six-
figure salary.
    [Laughter.]
    The Chairman. That's what I make.
    Senator Wyden.
    Senator Wyden. Thank you, Mr. Chairman, I thank all of our 
panelists.
    My own sense is that the green energy field is going to be 
a huge magnet for economic development and for good- paying 
jobs for our country's future. My sense is that we're really 
lagging behind in terms of getting good numbers about what's 
going on in this area.
    I've appreciated Chairman Bingaman's leadership in this 
area, and I know he's already tasked the Department of Energy 
to give us a sense of their assessment of the workforce needs, 
particularly in solar and biofuels and wind.
    What can you tell us today, in terms of the workforce needs 
in these very promising green energy fields?
    Let's make that for Ms. Hoffman to start with.
    Ms. Hoffman. We don't have any statistics at the moment on 
the workforce needs, but we have expanded EPACT Sections 385 
and 1830 to include the workforce requirements for renewable 
technologies as part of the potential future agreements with 
the Department of Labor. We know that there is growth in the 
industry, and that there is a huge potential for alternative 
energy and jobs across the United States in this area.
    Senator Wyden. When do you think you could give us a report 
on your assessment of the workforce needs in this area--and 
look, I'm not trying to give you a hard time on this--I think 
this is an area we feeling strongly about. My sense has been 
that because this is new, the government--and not as a result 
of blaming, you know, always flounders a little bit in terms of 
trying to figure out how to get all of the information. Can 
you, for purposes of this morning, give us a timeline on when 
you could get us a assessment of the workforce needs, at least 
in those three key areas--biofuels, solar and wind?
    Ms. Hoffman.
    Ms. Hoffman. Can I defer to----
    Senator Wyden. I'm sorry, for our two witnesses from the 
Government, Ms. Hoffman, Ms. DeRocco.
    Ms. DeRocco. As you can tell, Senator, we're partnering on 
the National Academy of Sciences study that is called for in 
the Energy Policy Act and with the expansion to alternative 
energy, we really have just begun the study work. We certainly 
will look at accelerating the work on the alternative energy 
field to see when we can get data to you from that study.
    Also, we have gained some experience with industry itself, 
having projections, and we'd be more than glad to very quickly 
reach out to provide the industry projections.
    I would also, just want to add that the National Renewable 
Energy Lab in Golden, Colorado has been an exceptional partner 
with nine of the WIRED regions that are focusing on alternative 
energy, to both determine the talent development requirements, 
the new competency and skill requirements, and to be of 
assistance in ensuring those employment centers around the 
country are beginning the skills development programs that will 
be necessary to support the growth of the industry.
    From those three sources, we will try to get you some 
preliminary information as quickly as possible, and we will 
focus on this National Academy of Sciences study which, I 
believe, is a year-long effort, so----
    Senator Wyden. So you could have this to us in 6 months?
    Ms. DeRocco. We'll try to get you some preliminary 
information within 6 months, National Academy of Sciences study 
will look to its conclusion within the year.
    Senator Wyden. Because I'm looking at the statute in terms 
of the National Academy and it talks about energy and mineral 
security requirements--all of which I strongly support, and I 
want to be clear on that. I just don't want renewables and 
green energy to get the short end of the stick, and I very much 
appreciate Chairman Bingaman's leadership on this, because I 
think both the Chairman and I think that there are a great many 
economic opportunities in this area, it's going to be an 
economic magnet for investors, and we're just going to need the 
government to be more proactive as it relates to the assessment 
of workforce needs in this area. I would like the recorder to 
note that there have been a lot of nods--affirmative nods--from 
our Government witnesses on this, and we appreciate that.
    Thank you, Mr. Chairman.
    The Chairman. Thank you very much.
    Senator Craig.
    Senator Craig. Thank you, Mr. Chairman, for focusing on 
energy workforce.
    Let me put it in a slightly different context--the Senator 
from Oregon talked about green and clean technologies, I am of 
the belief that all new technologies are clean or green, or we 
won't be building them. That's not only part of the climate 
change debate, it's about what we are now. EPACT says it, 
others say it--so in the context of all of this, a stainless 
steel welder on a nuclear reactor facility is going to be 
making twice as much money as the average wage of the State of 
Idaho.
    How do we take these traditional skills, Madame Secretary, 
and do what Senator Corker so appropriately says, how do we 
make them cool today? Because all skills related to energy 
today are clean, and green, and that's where our country wants 
to go.
    Now, that construction worker that erects a standard, put a 
wind turbine on, is making very good money with potential 
benefits. While that might be viewed as a sweat of the brow 
kind of labor force, compared to somebody sitting at a computer 
keyboard--that's green technology. That's cool. How do we make 
it cool? How do we communicate the new need in a way that 
catches the imagination of a necessary workforce?
    Sputnik did it for us, NDEA--I grew up in that period of 
time, 1958 forward. Then we went--National Academy of Science 
rising above a gathering storm, produced legislation here, and 
I stuck a little nuclear education and training into that.
    But, America gets captured by a feeling, and a mood, and a 
desire, and what becomes cool in someone's youth oftentimes 
drives them into a future employment or job training or 
education, how do we make it cool?
    Ms. DeRocco. Absolutely, well, we have a very strong 
industry education, government partnership looking at exactly 
that issue, Senator, you're absolutely right.
    I would make several points that we know now, and we are 
really advancing our opportunities to make these jobs cool, and 
to provide career information.
    The first point is, we have developed, the Department of 
Labor, in conjunction with the Department of Education, a Web 
site called ``Career Voyages,'' which is for young people, 
teachers and their parents to take them on a road trip to the 
careers of the future, and to present young people very diverse 
video, online information about the careers in energy and the 
opportunities to make good salaries and to be cool in their 
work life and at the workplace.
    We also published In-Demand magazine that illustrates the 
careers and put it in a million high schools around the 
country.
    We have to do much more than this, though. As my colleague 
from Florida indicated, our statistics show that 30 percent of 
our young people that are in 9th grade today will not graduate 
from high school 4 years from now. In large measure, we believe 
we haven't made education relevant to their work opportunities, 
their career opportunities, which tells me age 14 or 9th grade 
is too late to begin talking to these young people about the 
exciting career pathways that they could explore if they 
maintain and gain their academic foundation and then go on to 
post-secondary education in multiple forms.
    Our current Workforce Investment Act precludes our working 
with young people that are younger than 14. I think for career 
awareness purposes, and for exciting the young people, we 
probably have to look at that age.
    Finally, I would say this education, industry and 
government partnership now gets it, that we have to meet these 
young people where they are. They're on the web, and they're on 
iPods, and they're on YouTube, and Facebook, and we need to 
find ways to communicate with them in their medium, and we're 
working very hard on creative solutions that industry will be 
driving to meet them there, and to encourage them to explore 
careers in the energy field.
    Senator Craig. You mentioned in response, I think, to a 
question to Senator Bingaman that our land grant universities 
are kind of getting back to the idea of economic development. I 
know we've gone through this great period of university 
education as one of socialization and experience--maybe we 
can't get back to our roots. But, the only way land grant 
universities, oftentimes, are driven is by money. The private 
sector, in need of a workforce, is likely to invest at a 
university level if that university can see the green. In this 
case, we're not talking environment, we're talking bucks.
    Those kind of partnerships need to re-establish themselves. 
If you go back and look at the old background of land grant 
universities, they were all about economic development.
     Ms. DeRocco. Right.
    Senator Craig. Out there on the frontier, if you will, of 
economic growth. How do we recreate--or is there an opportunity 
for us to assist in creating greater advantages for private 
sector investment in our colleges and universities that move in 
that path?
    Ms. DeRocco. Again, Senator, I keep referring to the WIRED 
initiative, because it has been such a phenomenal learning 
experience for all of us, including the universities that they 
can play such a strong catalytic role in bringing together all 
of the strategic partners that are necessary to advance job 
creation and economic prosperity within a regional economy, and 
they serve so many roles, including being the site of lifelong 
learning for new skills and competencies, as well as the 
universities as researchers that begin the innovation 
lifecycle.
    So, they are creating the new products and product 
features, and they are training our workforce throughout their 
careers for individuals who are going to have multiple jobs and 
multiple opportunities in their lifetime.
    I'm not naive, either, in knowing that we invest $15 
billion a year--as I cited earlier--through this Public 
Workforce Investment System, which has rather traditionally 
looked to low-wage, low-skill occupations and the churn in the 
economy, and today recognizes that 90 percent of the fastest-
growing jobs require some post-secondary education, so the 
investment from the Federal Government and from States and 
local governments in our post-secondary education system--be it 
community colleges or 4-year colleges and universities--is 
going to increase. Therefore, they are most interested in 
becoming partners with government at all levels, with industry 
that is driving job creation and serving a leadership role 
within their regional economies. I think our day has come for 
engaging our university system as the regional economic 
catalyst.
    Senator Craig. Good, thank you.
    The Chairman. Senator Murkowski.
    Senator Murkowski. Thanks, Mr. Chairman, and thank you to 
the panelists here this morning, I appreciate your comments.
    To my distinguished colleagues, we're going to have to get 
with it. ``Cool'' is not the appropriate lingo when you're 
talking to teenagers----
    [Laughter.]
    Senator Murkowski.``Cool'' has now been replaced with 
``sick.''
    [Laughter.]
    Senator Murkowski. So----
    Senator Craig. The mother of teenagers.
    Senator Murkowski. [continuing]. I've got a 14 and a 16-
year old, and every time they say something is ``sick'' I look 
at them, oddly, and they say, ``Well, that's your version of 
`cool'.''
    So, I don't know that we necessarily want to include that 
in our legislation or in the pamphlets that we've had----
    [Laughter.]
    Senator Murkowski [continuing]. Out for publication.
    But, it is important to be meeting the young people where 
they are and I appreciate what you said, Madame Secretary, 
about going to their venues. Whether it's YouTube or wherever 
it is.
    We've been relatively successful in the State of Alaska in 
some programs to try to get kids more interested in the trades. 
We've realized that you don't start in high school. That fifth 
grade is about right. By first and second grades, kids are 
deselecting their careers. Once they've deselected, they're not 
going back to that as an area of interest. So, we need to get 
them very, very early on.
    I think we missed an opportunity here yesterday, we had 
about 5,000 young people here on Capitol Hill, their purpose 
was to lobby us on climate change issues. But when you talk 
about bright young minds that are passionate about the future 
of their country, and how we're going to make a difference, I 
told the 25 of them or so that were in my office, we need to be 
able to advance these technologies. There are huge 
opportunities for us out there, but you all are the ones that 
are going to make that happen. We need to tap into that source 
there.
    I want to ask you, Ms. DeRocco, from the Department of 
Labor's perspective, they've been helpful to us in the State of 
Alaska with some training grant money--we've received energy 
employee training money back in 2004, this was to help us 
prepare for our gasline, which we recognize--great opportunity 
for us, but it causes us a fair amount of angst, in terms of 
where are we going to get the workers that we will need for 
this very, very massive project?
    We have been working to build the energy workers for this 
project, but what we're finding is that, we'll train them, and 
they get kind of sucked into that energy infrastructure 
pipeline that is already needed. So, the gasline is still years 
down the road, we're trying to keep up with the need on the 
ground right now, and we're seeing a graying of our oil slope 
workers--about the same rate that you're experiencing here in 
the lower 48, but--what do we have available to us, in terms of 
training dollars across the country that is really going to 
make a difference? Do we have enough? Is it sufficient?
    Ms. DeRocco. Senator, yes, the needs in Alaska are huge, 
and we understand that. In addition to the project that you 
mentioned, which was a high-growth project for $7 million, we 
just this year provided $7.5 million specific, to creating the 
pipeline of workers for the pipeline. Putting the programs in 
place through your technical and vocational education programs 
and new apprenticeship programs. We've been working very 
closely with Commissioner Bishop in Alaska to make sure that we 
are supporting the efforts of the State, to use their Workforce 
Investment Act dollars which come as an annual appropriation, 
and to use them effectively as an investment for both your 
short- and long-term needs to build this energy pipeline. I 
mean that in both senses--the pipeline of workers, as well as 
the new pipeline that we're all working toward.
    Are there enough dollars? I think first and foremost, we 
have been focusing on reforming this workforce investment 
system and the current investment of $15 billion a year, to 
ensure that the investment is demand-driven, that we are, in 
fact, using it to educate and train workers for the jobs that 
are being created today, and those that are going to be created 
in the years ahead. To become demand-driven and understand that 
it may take longer, and higher levels of education and training 
to ensure that our workers are equipped for the marketplace 
next year, and 5 years from now.
    Once we get that--the use of those dollars that are 
currently invested and appropriated--right, I think we'll have 
a much better feel for whether additional resources are or are 
not needed. You've heard us say--and I know it's been 
frustrating to some Senators that--of, just the part of the 
Workforce Investment dollars that go through my Agency, which 
is about $9 billion out of that $15 billion a year, States and 
local workforce investment areas are carrying in over $1 
billion each year, unspent.
    That tells us there is still capacity to use the current 
appropriated dollars better, more effectively and more targeted 
to these sectors where jobs are being created, and new 
competencies and skills are needed by the workers. We need to 
get that right first. We need to assure we have reformed and 
well-invested those dollars, before we assess the need for 
more.
    Then the second point is--it is staggering, the amount of 
resources across our Federal agencies that are devoted to 
educating and training workers. We need to align and leverage 
those resources, and without any institutional framework for 
doing that, just the force of an initiative like WIRED, and the 
personalities that are currently working together, it is really 
hard work. Because every agency is kind of siloed and working 
in its own venue, and even the sharing of information is 
extraordinarily hard. But, we're getting better at it, and I 
think anything that Congress can do to help us in aligning and 
leveraging the resources currently devoted, we'll be doing a 
better job for Alaska and for the Nation in ensuring an 
educated and prepared workforce.
    Senator Murkowski. I appreciate that, thank you.
    The Chairman. Thank you very much.
    There are two Senators who haven't had a chance to ask 
questions of this first panel, and I'd just remind everyone 
that we have a second panel of five witnesses, still waiting to 
testify.
    Let me call on you, Senator Sessions, and then Senator 
Salazar.
    Senator Sessions. Thank you, Mr. Chairman, I appreciate 
this discussion. It goes beyond energy, to me. When I travel to 
Alabama and talk to businesspeople, they continue to be 
concerned about the number of qualified applicants.
    I will say to my business friends, however, that in many 
areas, the wages haven't gone up a lot, which makes me wonder 
how seriously driven they are.
    But, I do think it is a national problem, so I would just 
say, Mr. Chairman, I'll wait till the next panel, but would 
note two problems that we should be able to address.
    One is the question of young people finishing high school. 
Some have called it delayed adolescence. But they seem somewhat 
reluctant to move into a job that might be their permanent job 
the rest of their life, it's a commitment like marriage or 
something, they're just not willing to make, they don't want to 
make. They drift around with much lower-paying jobs, with less 
benefits, than they might otherwise take advantage of at some 
of these fabulous energy companies who pay well, who have good 
benefits and insurance.
    So, I guess, are you concerned--any of you would want to 
comment on this question of this gap of lost productivity that 
occurs when perfectly capable young people are not taking 
advantage of, perhaps, the best job opportunities that there 
exist, and can we help them take advantage of that?
    Ms. Cornelius. I'd like to respond to your question, 
Senator.
    In Florida, we've passed aggressive legislation to 
modernize and make more market-relevant our career and 
technical education programs.
    But, to your point--our statistics in Florida with our 
young people dropping out of school or not going on to college, 
6 of 10--it's criminal, that kind of statistic. These are not 
children that can not learn, rather, they've become 
disappointed with the traditional learning environment. What 
we've found through our modernized career and technical 
academies, like those we have in construction and in 
electricity, that they find some relevancy to the training that 
they're receiving--they're able to develop a mentoring 
relationship with a energy industry employee. They can see the 
future ahead of them and they understand why they are learning 
the way that they are.
    So, I think if there was anything that I would respond to 
your question with, it's the whole market relevancy, and the 
better understanding of what they're learning, and the 
application to the real world.
    Senator Sessions. Wonderful answer. Now, I know you're 
doing that in Florida, it sounds good. Let me ask you, 
honestly, I assume you're one of the leaders of the Nation in 
that, but with regard to the total number of kids graduated 
from high school in Florida, you're not yet at--reaching all of 
those, are you?
    Ms. Cornelius. No, sir, we are not.
    Senator Sessions. That's certainly not----
    Ms. Cornelius. We're just at the beginning.
    Senator Sessions. So, I think we're behind on that.
    Other question I would ask is about this aging workforce. I 
notice that Southern company representatives said that 45 
percent of the half million utility worker employees throughout 
the Nation are over 48. So, to me, what do you do at 60 or 65--
is there a way to encourage those older workers to stay and 
work longerand maybe taking less stress and less hours, more 
free time--are we doing enough to make work appealing for older 
workers to keep at it?
    Ms. Cornelius. Senator Sessions, if I may, again, respond 
to your question.
    Through the Florida Energy Workforce Consortia, which is 
comprised of all of our major energy partners throughout the 
State, we in effect, learn from one another--their knowledge 
transferring skills that they employ in their own company to 
retain those skilled workers. The ways that they're utilizing 
those skilled workers to keep them, either one, in the labor 
force, or to use them in other capacities. Perhaps teaching the 
new entrants into the workforce. It's a situation that we must 
look at.
    So, we're learning from one another, our power companies, 
learning what best in class for this knowledge transfer model, 
and applying it where we can.
    Ms. DeRocco. Senator, if I may add to that, just very 
quickly, we are about to present to the Senate, an interagency 
task force report on the aging of the American workforce called 
for by the Senate Select Committee on the Aging, where we are 
proposing many recommendations for continuing to engage, or 
reengage our older, mature workers in a variety of 
opportunities still in our workplace, and to bring down 
barriers that currently exist to their continued engagement, be 
it in employment, or as educators in these areas where we 
significantly need their assistance to ensure a strong, viable 
workforce. So, we'll look forward to sharing that report to 
you, as well.
    Senator Sessions. Thank you.
    The Chairman. Thank you very much.
    Senator Salazar.
    Senator Salazar. Thank you very much, Chairman Bingaman. 
I'll just make a quick comment, I know we have another panel 
waiting on the wings.
    But, I would say first, that through your leadership and 
the work on this committee, the work on the Finance Committee, 
the work on the Agriculture Committee and the Farm Bill that's 
on the floor today, we really are opening up this whole new 
opportunity for clean energy economy for the 21 Century.
    I think all of us who work on these issues are cognizant of 
the fact that we have technological barriers that we have to 
overcome, we have economic barriers that we have to overcome, 
but also, with that, we need to make sure that we are training 
the right kind of people to be able to take on the jobs for 
what is, I think, a huge imperative, as well as an opportunity 
for America.
    The National Renewable Energy Lab who, which is stationed 
in Colorado, and we will be hearing in the next panel from Dr. 
Ray Stults in a 2006 study NREL provided, made a finding that 
one of the barriers that we are looking at in terms of moving 
forward with this clean energy economy, is the whole issue of 
the absence of trained workers to deal with the new 
opportunities that are coming on down the line. So, I just want 
to say to you, Mr. Chairman, thank you for putting the 
spotlight on this issue, and I look forward to working with you 
on this, and so many other matters.
    Thank you.
    The Chairman. Thank you very much.
    Senator Menendez.
    Senator Menendez. Thank you, Mr. Chairman, I have a couple 
of questions that I'd like to ask.
    Secretary DeRocco, as you know, renewable energy demand and 
production has been exploding in recent years. For instance, 
some have projected 50 percent annual growth in the solar 
industry--something my home State of New Jersey is very 
interested in--for many years to come.
    Of course, creating those new green jobs is great for our 
economy, and for our environment, but I wonder what the 
Department of Labor has done to ensure that these new green job 
seekers actually get reached out in underemployed communities?
    For example, does the Administration support Senator 
Sanders' and Clinton's Energy Efficiency and Renewable Energy 
Workforce Development amendment to the Energy bill that would 
provide $100 million to develop a green job training program? 
Or, do you have some of your own initiatives in that regard?
    Ms. DeRocco. Let me start, Senator, thank you for asking 
these important questions. No. 1, in New Jersey, I hope you are 
aware that we have three WIRED regions, New Jersey is a huge 
contributor to our learning through the WIRED initiative, one 
of which is very much focused on green energy, and among their 
strategies is to assure that untapped labor pools is a focus 
for the education and job training that will provide new 
employment opportunities and long-term careers for many that 
have been previously been marginalized in the workforce.
    So, we are in your home State, looking very definitively at 
the opportunities for untapped labor pools. I would say--again, 
nationally, this is our time as a Nation to assure that 
targeted populations that previously have been marginalized. 
The demographics of today's workforce presents huge new 
opportunities for us to reach out to everyone and find a good 
job with good pay, and security and opportunity for economic 
prosperity for them and their families.
    So, while we talk about the challenges of the demographics 
of our workforce, this is our opportunity to really engage 
those who have formerly been marginalized. I think in the 
alternative, or green energy area, this is going to be an 
exploding area.
    The one issue--we did have several issues with the Green 
Jobs proposal. It is--it appears to us to be another siloed job 
training program. I've spoken often this morning about this 
public workforce investment system, where we are now managing 
17 different siloed programs which, by the time the resources 
and the eligibility requirements and all of the rules and 
regulations of 17 different programs get down to the States, 
and then to local workforce investment areas, it's very 
difficult for them to actually engage in----
    Senator Menendez. But, if it's not siloed for--to take your 
argument--then ultimately, how do we ensure that we drive in 
what seems to be the potential for an ever-growing part of the 
labor force, to reach out to it?
    Ms. DeRocco. It doesn't mean that it couldn't be focused 
specifically on an industry sector or a growth part of our 
economy, but I don't believe in that particular provision now, 
there is any reference at all to this broad- based public 
workforce investment system, and assuring alignment and 
leveraging with the resources, the service delivery system, and 
the opportunities for workers to access those opportunities 
through their community-based one-stop career centers, and to 
assure the resources for education and training are among those 
that can be accessed in that particular----
    Senator Menendez. Let me, in line with that, let me ask Ms. 
Hoffman, or you for that matter, you both might be willing to 
respond--but part of the purpose of this hearing is to raise 
awareness, helping to fill jobs that will ensure that we all 
have heat and electricity in the years ahead, but the current 
workforce didn't age overnight. It is the product of a whole 
host of things, one is aging, of course, but the other one is 
layoffs. It wasn't too long ago we had layoffs, consolidation, 
deregulation, and result in negative perceptions as to whether 
this is a field I want to get into.
    The question now becomes, how do we learn from those 
experiences as we talk about now moving to a growth level--how 
do we learn from those experiences, and what steps do we have 
to take to avoid this cycle in the future? So that we don't 
enter into the same cycle again? I'd invite anyone who wants to 
make an answer to that.
     Ms. DeRocco. I think, perhaps, we both do.
    One of those things we've learned, we've gotten a lot more 
sophisticated about understanding that across, for example, 
sectors within the energy industry, there are certain 
competencies and skills that are cross-cutting. In other words, 
these workers are no longer on a career ladder in a single 
sector within the energy industry, they have a career lattice--
an opportunity as business cycles change, as certain sectors 
within the industry grow, or others might decline, that their 
competencies and skills are transferable, to jobs across the 
industry.
    One of those things this shortage of skilled workers has 
really done for all of us, is engage all of the sectors--oil 
and gas, nuclear, power generation, alternative energy 
together, in looking at how do we define the competencies and 
skills that are needed for our workers, how do we assure that 
those workers have portable skills, so that they have career 
opportunities within the energy industry broadly, not just in a 
narrow sector where they might experience a business cycle 
downturn, for example.
    Ms. Hoffman. I would agree with Assistant Secretary 
DeRocco, that we must have some cross-cutting capabilities 
across the whole energy sector, to bring diversity to our new 
workforce. We also have to have flexibility within the 
workforce to be able to move them around in areas where we have 
the greatest need.
    The other thing that we need to provide is certainty in the 
industry and certainty that the energy sector is an important 
part of our economy for the investment that is required.
    Senator Menendez. Thank you, Mr. Chairman.
    The Chairman. Thank you very much.
    Let me thank this panel for your excellent testimony, and 
why don't we move right to the second panel here?
    The Chairman. OK, let me introduce people as you're taking 
your seat, your seats. We have five panelists on this panel.
    Norm Szydlowski is with Colonial Pipeline in Alpharetta, 
Georgia. Ray Stults is with the National Renewable Energy 
Laboratory. I know Senator Salazar wanted to make an 
introduction of Ray Stults, and why don't you go ahead right 
now with that.
    Senator Salazar. Thank you, Mr. Chairman.
    I have the special pleasure today to introduce my friend 
Dr. Ray Stults, who is the Associate Laboratory Director of 
the--for Energy Science at the National Renewable Energy 
Laboratory in Golden, Colorado. He is the program manager for 
research at NREL, sponsored by DOE's Office of Science, and is 
leading NREL's expansion of basic research programs. These 
programs are the roots that underpin NREL's applied research in 
solar, biomass, wind, buildings, and transportation. Ray has 
long been a servant at NREL, with a distinguished career in 
leadership in our National Laboratories and he brings a wealth 
of experience, bridging government and industry in NREL.
    I want to say this very quickly, just about NREL and some 
of the efforts we have underway in Colorado. It is our hope 
that, along with the rest of the Nation, that we see a 
burgeoning of renewable energy and new technologies to deal 
with the energy issues that we face in our Nation.
    We have to face those issues because of the inescapable 
forces of national security, environmental security, and 
economic opportunity that we face.
    NREL has been at the lead with the University of Colorado, 
Colorado School of Mines, and the University of Colorado, in 
developing a co-laboratory, which we actually discussed at some 
point here on our Energy Committee, where that co-laboratory is 
in the process of working with the private sector community to 
deploy the research and technologies being developed at NREL 
out into the private sector. It's something that we are very 
proud of. I know that the workforce issues are very much a part 
of those concerns.
    So, Dr. Stults, thank you for visiting us in Washington 
today. We're proud of NREL and I know that my colleagues here 
on this committee are very proud of the work you do.
    Dr. Stults. Thank you.
    The Chairman. Let me also say that we taught Ray everything 
he knows about energy in New Mexico when he was at Los Alamos 
National Lab. But we're very glad to see him here representing 
NREL, too.
    Jim Hunter is with the International Brotherhood of 
Electrical Workers here, and we appreciate you being here. Paul 
Bowers, Southern Company from Atlanta, Georgia. Thank you very 
much for being here. Carol Berrigan is here representing the 
Nuclear Energy Institute.
    Why don't we just go across from left to right on the panel 
here, and if each of you will take 5 minutes to summarize the 
main points of your testimony. We'll include your full 
testimony in the record.
    Mr. Szydlowski, go right ahead.

  STATEMENT OF NORM SZYDLOWSKI, PRESIDENT AND CHIEF EXECUTIVE 
       OFFICER, COLONIAL PIPELINE COMPANY, ALPHARETTA, GA

    Mr. Szydlowski. Thank you, Senator. I appreciate the 
opportunity to address the committee today.
    I think what we're talking about is a convergence of 
workforce demographics and energy infrastructure keeping up 
with the GDP growth that you mentioned earlier on in your 
opening comments, Senator. Probably the solution lies somewhere 
in this idea of cooperative, coordinated cooperation.
    At Colonial Pipeline, that's the company that I'm from, 
we've seen that a lot of good comes when the Government and 
energy industry works together to ensure that the 
infrastructure is in place, it's strong, it's responsive to the 
needs of the Americans. Nowhere was this more evident than the 
aftermath of hurricanes Katrina and Rita.
    I don't think, for the cooperation between government and 
energy industry, that the suffering, I suspect, would have been 
far worse and the recovery would not have begun within 48 hours 
after those terrible storms had come ashore if that cooperation 
was not in place.
    There's a number of members on this committee, including 
you, Senator Bingaman, that took a special interest, along with 
State officials, in seeing that the energy industry had what it 
needed to serve the public. That's essentially what we're 
talking about, I think, today. Does the energy industry have 
the right workers to make sure that Americans will have the 
energy they need today, tomorrow, and in the future?
    First, let me give you a quick description of our company. 
Colonial Pipeline carries about 20 percent of all the liquid 
petroleum products that moves on U.S. pipelines. In many 
markets we supply the vast majority of fuels that the 
communities rely on. Our headquarters in is suburban Atlanta. 
There we have a control center that operates this pipeline 24 
hours a day, 7 days a week.
    We're a company based on some pretty fundamental values. 
First of this is safety of the operations, so that we protect 
the workers, the citizens whose communities we operate in, the 
environment that we all share. Another fundamental value we 
share is reliability. Our customers and the public they serve 
depend on Colonial Pipeline, the Nation's most efficient, 
safest method of delivering fuels, and Colonial strives to be 
the best in our industry.
    Industry-wide, the petroleum sector estimates, not unlike 
the figures we've heard so far from Secretary DeRocco, that 27 
percent of the workforce is within 5 years of retirement. That 
figure is, certainly the same for us in our company, and the 
problem is a little worse for us, in the people that actually 
do the operating of the pipeline, where near one in five of the 
employees are eligible to retire in 2 years.
    Labor statistics put the average U.S. worker at 39 years. 
We heard some earlier commentary about a much larger age in the 
electrical business. For Colonial Pipeline, our company-wide 
average is just short of 44 years. About half of our workers 
are over the age of 40.
    We currently have a project that we're developing that 
would add a third pipeline for our company. Trying to keep up 
with demand--this would be another pipeline in a corridor that 
exists between Baton Rouge, Louisiana and Atlanta--the project 
still faces some regulatory and engineering hurdles, but it 
would add about 33 million gallons of fuel delivery capacity a 
day. Also, if you look at the U.S. refining capacity, there's 
about a million barrels of new capacity scheduled to be 
available by 2012.
    When we initially proposed the project a few years ago, we 
thought it was going to cost a billion dollars. Today, we think 
by the time it gets together, it will probably be $2 billion, 
given cost increases, which include commodities and as well as 
labor.
    Colonial today, with industry and government partners also 
has been researching some transportation of ethanol and 
biofuels in the pipeline. While the initial results are very 
encouraging, we still have a lot of work to do, some questions 
to answer. Hopefully we'll be in a position to make some test 
shipments of those biofuels in 2008.
    It's unlikely that these efforts will add a lot to our 
workforce demands in the long-term, as we view this biofuels 
effort, but there may be some system modifications that, again, 
could put some pressure on the construction expertise.
    I'd like to suggest some actions that you might consider, 
one of which I think, encouraging policies that match the 
technical school with the skill-trade training, with workforce 
needs, working on the stigma of vocational technical careers, 
in the sense of professional careers. I think this would have 
the most immediate impact on workforce needs.
    It's an area where companies like ours would be willing to 
participate, either in design of curriculums or providing some 
other support. Also, there's some IRS relief, I think, that 
would be a big help to us. This has to do with phased 
retirement initiatives that would allow companies to make some 
in-service distribution of retirement benefits.
    This challenge of workers that are older, between, say, the 
ages of 62 and 55, is one--is a group where we need the 
experience for training, we need the manpower to do what we 
need to do in these areas, and it's becoming very, very 
difficult under the current situation to hold on to those 
workers and keep them in place.
    We can't ask them to jeopardize their pension benefits or 
the non-qualified status of our pension plan when we ask them 
to help us out and stay on longer and do training and 
participate in the company's activity.
    So again, thank you for the opportunity to testify. 
Colonial Pipeline welcomes your continued interest and support. 
It's been invaluable to our company, in particular to--and make 
a contribution to the industry and the Nation. Speaking for the 
630 employees in Colonial and for the pipeline industry as a 
whole, we're ready to help in any way we can to help develop 
some solutions for the workforce shortage facing the Nation's 
energy suppliers.
    [The prepared statement of Mr. Szydlowski follows:]

 Prepared Statement of Norm Szydlowski, President and Chief Executive 
           Officer, Colonial Pipeline Company, Alpharetta, GA
    I appreciate the opportunity to address the Committee today. I want 
to commend you for focusing attention on whether the domestic energy 
industry has the necessary workforce and skill sets to ensure our 
Nation has the vital energy we need.
    Too often the U.S. energy industry is portrayed as uninterested in 
the future, as passive and as part of the problem, not the solution. 
The truth is our industry exists to serve the American people by 
providing an essential commodity. I was fortunate enough to represent 
our country as an advisor to the Iraqi Oil Ministry, so I have seen 
firsthand what happens when a Nation's energy industry is unable to 
meet the people's needs. First at Chevron and now as CEO of Colonial 
Pipeline, I also have seen the good that comes when a government and 
the energy industry work together to ensure infrastructure is in place, 
is strong and is responsive to the needs of Americans.
    Nowhere was this more evident than in the aftermath of Hurricanes 
Katrina and Rita. If not for the cooperation between the government and 
the energy industry, the suffering would have been far worse and 
recovery would not have begun within 48 hours of those terrible storms 
coming ashore. Three members of this committee--Senators Bingaman, 
Domenici and Akaka--were among the U.S. and state officials who took a 
personal stake in seeing that the U.S. energy industry had what it 
needed to serve the American public. That is essentially what we are 
talking about today: does the energy industry have the right workers to 
ensure Americans will have the energy they need today, tomorrow and 
into the future.
    My remarks will share Colonial Pipeline's experience. As the 
largest pipeline of its kind, I believe it provides examples that 
represent the entire pipeline segment of the U.S. energy industry. I 
believe my remarks also represent experiences of the broader energy 
sector, including nuclear, refining, natural gas and electric 
utilities. I will conclude with my thoughts on what leadership this 
Committee can provide on this issue.
    First, let me give you a quick description of Colonial Pipeline. 
Created in 1962, Colonial today consists of 5,519 miles of underground 
pipeline connecting refineries primarily in the Gulf Coast with markets 
across the Southern and Eastern United States. We begin in Houston and 
end at the New York harbor. The main lines are 40-and 36-inches in 
diameter, with one primarily devoted to gasoline and the other carrying 
distillate products such as jet fuel, diesel fuel, home heating oil and 
fuels for the U.S. military.
    We connect directly to major airports along our system. Visually, 
Colonial looks like a long expanse of right-of-way with 15 tank farms 
along the way. These tank farms store more than 1.2 billion gallons of 
fuel and help provide communities with a 4-5 day supply before they 
need to be replenished.
    Overall, Colonial carries 20 percent of all liquid petroleum 
products that move on U.S. pipelines. In many markets we supply the 
vast majority of fuel those communities rely on. In others, such as the 
Northeast, we face competition from overseas shipments of fuel. There 
our gasoline shipments are less significant than our distillate 
shipments (home heating oil, jet fuel, etc.) Our headquarters is in 
suburban Atlanta from where our Control Center operates the pipeline 24 
hours a day, seven days a week. We are a company based on some 
fundamental values. The first of these is the safety of our operations 
so that we protect our workers, the citizens in whose communities we 
operate, and the environment we share. Another fundamental value we 
share is reliability. Our customers--and the public they serve--depend 
on Colonial. Pipelines are the Nation's most efficient and safest 
method of delivering fuel, and Colonial strives to be the best in our 
industry.
    When construction began in 1962, it was a different world. There 
wasn't the global economy we have today. The pipeline was mostly in 
rural areas. Growth and development have brought us much closer to 
cities and towns. Suburbs now overlap our right-of-way. There have been 
corresponding changes to the workforce as the Nation has grown. The 
information highway has shown many young men and women in search of 
career opportunities a more glamorous world 2 than pipelines and 
refineries. Fewer are following their parents' line of work, instead 
pursuing their own career paths and direction.
    Across our industry, consolidation has caused a sharp decline in 
employment since the early 1980s. Over half a million petroleum jobs 
were lost between 1982 and 2000. These layoffs gave an entire 
generation the impression that our industry was an unreliable employer. 
While Colonial's employment remained relatively stable during these 
years, we have had to deal with the same shrinking pool of candidates 
applying for careers within the overall industry. We are competing hard 
for candidates who may have fewer skills than candidates 10 years ago.
    To address the situation, we have increased our compensation 
packages in an effort to attract entry-level workers. Colonial offers 
candidates with no more than a high school degree a starting salary of 
approximately $42,000 with the ability to progress their career to 
$70,000 a year. That is only an average. Those who follow this path 
can--and do--become Lead Operators earning $84,000 per year. Again, 
these are base salaries. On top of the base are shift differentials and 
overtime pay. To attract entry-level workers and to retain our current 
workforce we have included a full benefits package and annual bonuses. 
In critical labor markets such as Houston and the Northeast, we also 
pay geographic differentials. I stress that these opportunities are for 
non-skilled positions. The competition for engineers and more highly 
skilled positions is even more intense and the pay packages accordingly 
climb dramatically.
    This challenge of recruiting new workers is not unique to our 
industry. But what makes it more serious for Colonial is the rate at 
which our current workforce is departing. Part of this is due to 
realities of the workplace. Fewer workers are spending their entire 
career at one company. The consequent trend is for an employee to spend 
2-3 years mastering their skills and then to re-enter the job market in 
search of opportunities beyond their current employer.
    But an even larger contributor is the graying of our workforce.
    Industry-wide, the petroleum sector estimates 27 percent of its 
workforce is within five years of retirement. That figure is the same 
for Colonial's workforce. The problem is worse among the people who 
operate the pipeline, where nearly one in five employees is eligible to 
retire within two years. Of the four most critical positions, 35 
percent of our Senior Operators/Lead Operators and 29 percent of our 
Inspectors are within two years of retiring. Among Controllers (who 
control and monitor pipeline operations) and Technicians (who maintain 
pumps, valves and other pipeline equipment), each group has 15 percent 
of their complement within two years of retiring.)
    The U.S. Bureau of Labor Statistics puts the average age of the 
U.S. worker at 39 years. Colonial's company-wide average age is just 
short of 44 years. As the chart* below shows, more than half of our 
workers are over the age of 40.
---------------------------------------------------------------------------
    * All charts and graphs have been retained in committee files.
---------------------------------------------------------------------------
    Unfortunately, these workforce issues are striking just as the 
business demands on and opportunities for pipelines are accelerating. 
This is especially true for Colonial Pipeline. As you are aware, 
expansions are under way for several refineries in the Gulf Coast 
region we serve. As a large-volume pipeline capable or transporting 
this product to the major population centers of the South and Eastern 
seaboard, Colonial is in a great position to help with the industry's 
growth and with increasing the supply of available fuels.
    We are currently developing a project that would add a third 
pipeline of 36 inches in diameter along our existing pipeline corridor 
between Baton Rouge and Atlanta. This project, which still faces 
several regulatory and engineering hurdles as well as the final 
approval of our owners, could add 800,000 barrels of additional 
capacity every day. That equates to an additional 33 million gallons of 
fuel every day. (By comparison, announced refinery expansions will 
produce an additional 1 million barrels per day of product by 2012.)
    When we initially proposed the project, we estimated the cost would 
be $1 billion for 465 miles of new pipeline. However, we now estimate 
the project will top $2 billion. Part of that may be our conservative 
estimates in the beginning, and part of it is the rising price of 
steel. But a significant part of the higher estimate is due to the 
competition for qualified workers to build our project. The very 
expansions within the refining sector of our industry are soaking up 
the available skilled labor pool we are seeking for our own project. 
Although construction on our proposed project would not begin before 
2011, our forecast is that the labor market will be as tight if not 
tighter by that time.
    While this expansion will likely have minimal impact on our long 
term needs for operations manpower, it will require approximately 2,000 
construction jobs during the building period.
    Colonial has also been researching the transportation of ethanol 
and other bio-fuels on our pipeline. As you may or may not be aware, we 
are working with others to determine whether ethanol can be transported 
in a steel pipeline without inducing stress-cracking. While initial 
results are encouraging and there is much work to be done and questions 
to be answered, we hope to make test shipments in 2008. It's unlikely 
that the these efforts will add significantly to our workforce demands 
long term, but the system modifications to handle these fuels may 
require could add yet another need for scarce design and construction 
expertise.
    We hope projects like our expansion and our research into carrying 
fuels that will boost America's energy security are steps toward making 
our pipeline industry more attractive to young workers looking for a 
company to start and/or develop their career.
    The work of this Committee has the potential to have far more 
substantial benefits for the workforce needs we face. Speaking for 
Colonial, here are some steps I think would benefit the industry as a 
whole and therefore the Nation's consumers:

    --Encourage policies that improve technical school and skilled 
            trade training. This would have the most immediate impact 
            on our workforce needs, and this is an area where companies 
            like Colonial would be willing to participate either in the 
            design of curriculums or by providing other support, such 
            as grants targeting the development of skills and trades 
            needed in our industry.
    --Provide IRS relief on phased retirement initiatives that will 
            allow companies to make in-service distribution of 
            retirement benefits. We need to tap into the knowledge and 
            experience of those employees who retired solely to have 
            access their lump-sum benefits. We need their help 
            preparing the new workers, and we can't ask them to 
            jeopardize their pension benefits--nor the tax-qualified 
            status of our pension plan--when they answer our call.
    --As Congress works on solutions to the Immigration question, 
            please keep in mind that foreign workers represent a 
            potential pool of skilled workers that would address our 
            workforce shortages and provide stable, well-paying jobs 
            that would not only benefit the individual but the 
            community as well.

    Thank you for the opportunity to testify before the Committee. 
Colonial Pipeline welcomes your continued interest and support. It has 
been invaluable to our company in particular and a contribution to the 
industry and the Nation. Speaking for the 630 employees of Colonial 
Pipeline, and for the pipeline industry as a whole, we stand ready to 
help in any way we can as you develop solutions to the workforce 
shortage facing the Nation's energy suppliers.

    The Chairman. Thank you very much.
    Mr. Bowers.

   STATEMENT OF W. PAUL BOWERS, PRESIDENT, SOUTHERN COMPANY 
                    GENERATION, ATLANTA, GA

    Mr. Bowers. Thank you, Mr. Chairman, and distinguished 
members of the committee. I am honored to appear before you 
today, and offer the perspective from the energy industry on 
its workforce needs and concerns.
    As we look forward over the next 5 to 10 years, we are 
confronted with a significant and increasing shortfall of 
skilled craft workers, upon whom we depend on for operation, 
maintenance, and development of our energy infrastructure. How 
this shortfall is addressed will directly impact the ability of 
the industry to satisfy the growing energy needs of our Nation, 
while ensuring a thriving secured domestic economy.
    To put matters in context, please let me offer you a few 
statistical frameworks. The National Electric and Gas Utility 
Sector employs approximately 550,000 individuals. More than 
half of these individuals work in specific areas, such as 
generation, transmission, and distribution, which require 
skilled craft personnel in such roles as technicians, 
mechanics, power plant operators, and line workers.
    In the Southeast, the supply of skilled of craft industrial 
labor, in recent years, was measured at approximately 120,000 
individuals. That number fell short of the demand by 
approximately 20,000 individuals. By 2011 the deficit is 
expected to more than double, as demand for labor increases to 
more than 170,000 persons.
    In short, the supply of skilled craft labor lags well 
behind demand. One key reason for this problem is our aging 
workforce, which has been mentioned here already. Within 5 
years, the utility industry could see losses of between 40 and 
50 percent of its generation, transmission, and distribution 
employees. Currently, more than 45 percent of the half million 
utility employees are at the age of 48. More than 25 percent 
are over the age of 53, while only 13 percent are below the age 
of 33.
    At Southern Company, our numbers are no different. 
Approximately 8,000 retirements are expected in the next 10 
years, or 31 percent of our company's entire workforce could 
retire. The drop in available skill-craft workers is also 
attributable to a shift in cultural norms associated with such 
careers. As compared to when you and I were in high school, 
educators, counselors, and parents today have deemphasized or 
eliminated altogether the avenue of vocational or technical 
programs. Participation in industry related vocational and 
technical courses has decreased by 35 percent over the past 
decade.
    The consequence of such deficit and skill-craft worker 
shortage can not be understated. The North American Electric 
Reliability Council found in its 2007 survey of reliability 
issues, that the utility user, owners, and operators ranked 
aging workforce and the lack of skilled workers as the foremost 
cause of reliability risk.
    Demand for energy continues to increase. To satisfy this 
demand, a national investment of approximately $900 billion is 
expected in energy infrastructure projects over the next 15 
years, with $400 billion of that committed to the Southeast. 
Current forecast assumes approximately 26 new nuclear plants, 
77 new generation stations, all could be constructed in the 
Southeast, along with 3,500 miles of transmission.
    Southern Company has taken a number of steps to address 
these issues as best it can. In 2001, which has already been 
mentioned, our subsidiary, Gulf Power, opened a academy in 
Pensacola, Florida, designed to foster and a feeder pool for 
important positions such as entry-level power generation, power 
delivery jobs. Southern Company, through Alabama Power and 
Georgia Power, provides a number of education leadership forums 
for students and educators and has partnered with technical 
schools to develop heightened standards of education in an 
effort to increase the passage rate of individuals taking 
industry pre-employment tests. These efforts can only take 
Southern Company and the industry so far, and will inevitably 
fall short.
    An effort to assist the committee in development of such 
plans, Southern Company offers some suggestions and ideas for 
consideration and discussion.
    One, an increased awareness is needed of the critical 
workforce issues we face. In an effort to support continued 
economic development across the Nation, our educators and the 
students in their care must become better aware of the existing 
and future skill-craft labor careers and opportunities. Current 
academic mandates do not award credit to students who 
participate in career technical educational programs. Their 
credit systems must be modified, so that credit toward 
graduation is awarded as part of participation in technical 
curriculum.
    The national curricula and related standards for middle and 
high schools are needed to complement and improve the 
perception and selection of careers in energy and construction 
industries by qualified students. A perfect example is the 
model in Florida with the Career and Professional Education 
Act.
    Finally, let me summarize and say thank you for allowing me 
to appear before you. Southern Company and its employees 
greatly appreciate your commitment to this issue. On their 
behalf, I hope you will carefully consider the points I've 
raised in my written testimony and hopefully I'm available for 
you to answer the questions you might have.
    Thank you.
    [The prepared statement of Mr. Bowers follows:]

   Prepared Statement of W. Paul Bowers, President, Southern Company 
                        Generation, Atlanta, GA
    Thank you, Mr. Chairman, Ranking Member Domenici and other 
distinguished members of the committee. My name is Paul Bowers, and I 
am president of Southern Company Generation, a business unit of 
Southern Company, the largest electric utility in the United States. 
Headquartered in Atlanta, Southern Company owns and operates more than 
42,000 megawatts of generation capacity and more than 27,000 miles of 
electric transmission lines. To operate, maintain and manage this vast 
electric energy infrastructure and to reliably supply electricity to 
our customers, Southern Company employs more than 26,000 women and men 
across four states.
    I am honored to have this opportunity to appear before you today on 
behalf of Southern Company and offer the perspective of the electric 
utility industry on the workforce requirements of our Nation's domestic 
energy industry. These needs are an integral part of any discussion 
regarding the electric utility industry in the United States--both 
present and future--and it is my hope through this testimony to address 
the intent of this hearing by outlining several fundamental workforce 
issues that our industry faces as it continues to grow into this new 
century. First, I will describe the current state of the energy 
workforce and the demands facing the industry. Then I will discuss the 
future growth requirements expected in the region as well as short-term 
actions that have been taken to alleviate problems associated with 
current and anticipated industry workforce needs in the face of growing 
demand. Finally, I will offer suggestions for this committee to 
consider as it addresses these critical issues and recommends policy 
actions that will ensure the United States has a secure and abundant 
supply of energy.
         i. the state of the domestic energy industry workforce
    Recent data collected by the United States Census Bureau indicates 
that the national electric and natural gas utility sectors employ 
approximately 555,000 individuals. Half a million people, dedicated to 
keeping the lights of our country on, its homes warm, and its economy 
thriving. More than a quarter of this group, or approximately 120,000 
workers, serve the Generation (including nuclear) function of the 
sectors--namely producing the energy our Nation needs. Another 260,000 
people serve the Transmission and Distribution functions, and see that 
the generated energy safely and reliably reaches the people and 
businesses that require it. Both functions require a host of skilled 
craft personnel, who fulfill the critically important roles of 
technicians, power plant operators, lineworkers, and pipefitters/
pipelayers.
    The energy demand served by the infrastructure to which these 
individuals tend has increased by an average of 2 percent annually over 
the last five years. In the Southeast, that demand growth has averaged 
3 percent over the same period. In any event, according to the Energy 
Information Administration, the demand for energy in the United States 
is expected to increase 31 percent between 2005 and 2030. As this 
committee has recognized, such growth in demand necessarily requires a 
workforce to satisfy it. As this committee also appears to have 
recognized that, a shortage exists in the number of workers available 
to meet this demand.
    Internal Southern Company research indicates that the available 
supply of skilled craft industrial labor in the Southeast for 2006 was 
approximately 120,000 individuals.* \1\ This figure comprises such 
service categories as operation and maintenance, environmental, and 
industrial, and includes both union and non-union workers trained as 
pipefitters/combo welders, boilermakers/tube welders, electricians, 
millwrights and iron workers.\2\ The 120,000 person number fell short 
of the demand in the Southeast for skilled craft labor in 2007 by 
approximately 20,000 workers. Moreover, that deficit is expected to 
more than double through 2011, as demand for skilled craft laborers in 
the Southeast grows to more than 170,000 persons.
---------------------------------------------------------------------------
    * All exhibits referred to in Mr. Bowers's testimony have been 
retained in committee files.
    \1\ See Exhibit 1, Southeast Industrial Craft Labor Demand Chart, 
Southern Company Generation.
    \2\ See Exhibit 2, Southeast workforce White Paper.
---------------------------------------------------------------------------
    This demand growth reflects not only the expanding energy needs of 
the Southeast (along with the rest of the Nation), but calls attention 
to an equally significant workforce issue the electricity industry must 
face: an aging workforce. According to a recent Center for Energy and 
Workforce Development (CEWD) survey, the electric and natural gas 
industries could lose between 40 to 50 percent of their Generation, and 
Transmission and Distribution employees within the next five years.\3\ 
In fact, more than 45 percent of the half million utility employees 
serving our country's energy needs are above the age of 48. More than 
25 percent are over the age of 53. Only 13 percent of employees are 
below the age of 33. According to a fall 2006 Washington Post report, 
more than half of the entire electric utility workforce will be 
eligible for retirement within 10 years. Not surprisingly, an 
accounting for this demographic distribution of personnel results in 
projected losses in some skilled craft positions well in excess of 50 
percent.
---------------------------------------------------------------------------
    \3\ See Exhibit 3, Gaps in the Energy Workforce Pipeline: A 2007 
Workforce Survey Report from the Center for Energy and Workforce 
Development, Executive Summary and Summary of Findings.
---------------------------------------------------------------------------
    For example, more than 52 percent of Generation technicians may be 
eligible to retire by 2012. When that number is considered with the 
normal 8.4 percent attrition rate, the potential need for replacement 
Generation technicians exceeds 60 percent. Lineworkers likewise present 
a similarly significant workforce issue. In 2005, the Department of 
Energy concluded that the electric utility industry could suffer a 
shortage of 12,000 lineworkers by 2015 (assuming a modest 1.5 percent 
growth rate), or nearly 20 percent of the current workforce. For some 
organizations, lineworker retirements could approach 50 percent of 
total personnel. Vacancies of upwards to 50 percent (and beyond) also 
are anticipated for power plant operators and engineering jobs 
generally as retirement eligibility grows over the next five years.
    The numbers at Southern Company vary little from national figures. 
Our 26,000 employees include 6,300 persons serving the Generation 
function, 2,500 serving the Transmission function, while the remaining 
17,200 serve roles in Distribution, Customer Service and Support 
functions. Approximately 15 percent of Southern Company's employees are 
below the age of 33; however, more than 45 percent are above the age of 
48. Over the next 10 years, Southern Company projects approximately 
8,000 retirements, or 31 percent of its workforce, with approximately 
one quarter of those being skilled craft personnel such as plant 
operators and lineworkers. Retirement eligibility, however, will grow 
to 64 percent of the workforce, with approximately 46 percent of the 
Southern Company Generation workforce between age 58 and 61.
    Compounding these problems is a marked lacked of proficiency of 
personnel entering the workplace. Over the past two years, more than 
2,000 potential employees could not pass entrance tests required for 
employment with Southern Company Generation. Although Southern Company 
has seen a slight increase in qualifying applicants between 2006 and 
2007, only 37 percent of applicants qualified for employment in Alabama 
in 2007 (up from 30 percent in 2006), while 41 percent of applicants 
qualified for employment in Georgia in 2007 (up from 39 percent in 
2006). A number of sources can be blamed for the shrinking skilled 
craft labor pool. Most notable is a shift in cultural norms associated 
with skilled craft labor careers.
    Presently, parents, school counselors and students' peers emphasize 
the importance of completing secondary education with the goal of 
gaining acceptance to and attending a four-year college. To this end, 
some state government policies (whether organic or interpreting federal 
policy) have led to the elimination of many high school vocational and 
technical programs that previously served as introductory training for 
future skilled craft laborers. Over the past decade, the number of 
students in high school who are taking trade or industry-related 
vocational and technical courses has declined by 35 percent. Moreover, 
many would-be candidates hold misperceptions about such positions. Once 
considered excellent career options, the high-paying skilled craft work 
is now seen as second class. Individuals also associate such work as 
seasonal and without adequate benefits, neither of which may be (and 
often is not) true.
 ii. future growth affecting the workface and short-term actions taken
    The consequences of a skilled craft worker shortage cannot be 
understated. The North American Electric Reliability Corporation (NERC) 
found in its 2007 Survey of Reliability Issues that utility users, 
owners and operators ranked ``aging workforce and lack of skilled 
workers'' as the foremost cause of reliability risk. Moreover, a 
deficit of 50,000 skilled craft workers by 2011 cannot adequately 
sustain the industry growth that the Nation expects in order to satisfy 
the corresponding increase in demand. The growing number of industry 
retirements that will invariably overlap with the increase for labor 
will only exacerbate the problems created by such a shortfall.
    Specifically, Cambridge Energy Research Associates (CERA) expects 
supply levels in the Southeast to fall over the next five years to 
levels that will require investment in new capacity.\4\ According to 
CERA estimates, the energy industry nationally will invest 
approximately $900 billion in infrastructure projects over the next 15 
years, with the South's share of such investment expected to exceed 
$400 billion. The Nuclear Energy Institute estimates that the Southeast 
could host 26 new nuclear plants for which license applications are 
being developed. Moreover, NERC estimates the construction of 77 new 
generating stations in the Southeastern Electric Reliability Council 
(SERC) region through 2013, along with 3,500 miles of transmission 
lines as part of 183 different projects. Through 2025, Southern Company 
will require 17,000 MWs of new capacity to satisfy demand within its 
four-state control area, an amount that is more than 40 percent of our 
current capacity. In addition, Southern Company will be installing 
environmental controls over the next three years, for which we expect 
to expend $4.6 billion and require 8.5 million skilled craft labor 
hours, as well as other projects that we expect to consume more than 2 
million skilled craft labor hours.
---------------------------------------------------------------------------
    \4\ See Exhibit 2, Southeast workforce White Paper.
---------------------------------------------------------------------------
    Southern Company is not atypical in this regard. Across the 
Southeast, 55 new scrubbers to reduce sulfur dioxide emissions are 
planned over the next several years that will, in total, require an 
estimated 35,000 workers. The skilled craft labor required to serve 
these needs does not, however, exist for the utility industry alone. By 
way of example, Southern Company understands the new ThyssenKrupp steel 
plant in Mobile, Alabama will need skilled craft workers to satisfy 
approximately half of its 2,700 total workface, while the new Kia 
automobile plant in western Georgia will require a substantially 
similar amount of craft labor as part of its approximately 2,800 
workers. Additionally, reconstruction along the Mississippi and 
Louisiana Gulf Coast in the wake of Hurricane Katrina still consumes 
the time and availability of thousands of skilled craftspeople.
    It should thus come as no surprise that the spiking demand and 
plummeting supply make for an impressive increase in wage expectations 
for the skilled craft laborers. While perhaps obvious, it bears 
remembering that the work performed by these skilled craftspeople 
cannot be outsourced. Rather, it must be performed on site. 
Accordingly, in the coming years, union wages are expected to increase 
4 to 6 percent annually. Additional compensation, such as subsistence 
(per diems, stipends) and other incentives, may become required to 
attract union labor to specific projects. Non-union compensation is not 
expected to be any different, as wages and benefits packages for open 
shop employees currently coincide with that received by union workers. 
Although the skilled craft workers certainly benefit from higher wages, 
the increased costs ultimately result in higher electricity rates for 
customers.
    Furthermore, the reduction in qualified skilled craft personnel 
increases the potential for quality and safety issues, and a 
corresponding lack of productivity. For example, one of Southern 
Company's Alabama plants has approximately 1,400 skilled craft 
employees on site. Over the past year, the turnover rate at the plant 
has increased to 28 percent. Additionally, the plant has seen an 
increase in the failure rate of certain quality control metrics. Such 
failures cause delays in repairs and ongoing maintenance, which 
necessarily impact productivity and result in an increase in plant 
costs. In this time, Southern Company also has witnessed an increase in 
the percentage of skilled craft workers who are either less familiar, 
or unfamiliar, with working on industrial sites. Here too, quality and 
safety concerns are implicated.
    Southern Company is taking steps to address the issues that it has 
recognized. In 2001, Gulf Power (one of the Southern Company operating 
companies) began its first academy at West Florida High School of 
Advanced Technology in Pensacola, Florida. Through this academy, Gulf 
Power was able to develop a feeder pool for important positions such as 
entry-level power generation and power delivery, as well as degreed 
positions such as engineers. Each incoming junior is paired with a Gulf 
Power mentor who holds a career of interest to the student. Incoming 
seniors who meet certain criteria are placed in a program where they 
report to Gulf Power during certain school hours for completion of 
their curriculum and work obligations. Since its introduction, the 
program has expanded to two other Florida high schools, and has 
produced 62 graduates, 30 of whom have been hired by Gulf Power or 
other utility or related companies (with another 26 enrolled in 
college).
    Southern Company also provides a Summer Energy Career and 
Leadership Academy for incoming freshmen in Burke County, Georgia; 
facilitates a Summer Educators Forum at its nuclear plants Vogtle and 
Hatch for area high school and technical school educators; provides a 
leadership conference for junior students in the Mobile County, Alabama 
School District to raise awareness of careers in the energy industry; 
and partnered with technical schools in Georgia to develop a Technical 
Certificate of Credit, the goal of which is to increase the passage 
rate of individuals taking the Edison Electric Institute pre-employment 
test (and thereby increase our qualified pool of candidates). Southern 
Company also is partnering with Georgia technical schools to develop an 
electrical lineworker program from which our Georgia Power operating 
company can hire new personnel. An additional, but by no means final, 
effort undertaken by Southern Company involves collaboration with 
technical schools to develop a power-plant operator course that 
introduces students to the responsibilities of a plant mechanic at our 
Southern Nuclear facilities.
    Southern Company also has taken operational steps to address 
workforce shortage. One short-term method we have adopted in an effort 
to manage the labor demand issues is scheduling. For example, when 
possible, Southern Company plans its plant outages to coincide with 
environmental-controls construction projects in an effort to optimize 
the skilled craft labor on our plant sites. In other situations, 
Southern Company has changed the timing of its installation of 
environmental controls. In this way, we avoid having too many skilled 
craft workers at a particular location at any one time (which often 
creates high turnover, as well as quality and safety issues).
    Through partnerships with other industries, workforce investment 
boards, and state governments across our service territory, as well as 
active membership in community, state and national organizations, 
Southern Company also is endeavoring to increase the supply of skilled 
craft professionals. For instance, in 2004, Southern Company began 
evaluating the workforce needs in our region through the CEWD. A 
partnership among utilities and industry associations such as the 
Edison Electric Institute, the American Gas Association, the Nuclear 
Energy Institute and the National Rural Electric Cooperative 
Association, as well as contractors and unions, CEWD seeks to expedite 
the creation of educational programs, improve the skill levels of 
graduates, improve their awareness of opportunities in the utility 
industry, and increase the number of diverse qualified applicants who 
want to work for utilities.
   iii. suggestions for the committee in development of policy action
    Despite these and other efforts by Southern Company and others in 
industry, there remains much to be done to address the critical 
shortfall of skilled craft workers the domestic energy industry faces 
in the coming years. Resolving this challenge will not be accomplished 
without attention and support from Congress and distinguished leaders 
such as yourself. In an effort to assist the committee in this regard, 
Southern Company offers the following suggestions.

   Increased awareness is needed on issues related to skilled 
        craft labor and workforce initiatives in order to support 
        economic development. As I have discussed, the domestic energy 
        industry is approaching a significant demographic cliff in its 
        skilled craft workforce. Addressing the problem posed by this 
        reduction in available labor should be a priority for Congress, 
        as the growth of the Nation's electric infrastructure 
        generally, and Southern Company's region of the country 
        specifically, depends upon the development of a workable 
        solution to this problem. By increasing awareness of these 
        issues, the confidence of all business sectors in the South 
        will improve, as will the quality of life of those working in 
        it, and dependent upon it.
   National curricula and related standards for middle and high 
        schools are needed that raise awareness of careers in the 
        energy and construction industries and enhance the ability of 
        qualified students to enter skilled craft positions immediately 
        from high school. A possible model would be Florida's Career 
        and Professional Education Act. Developed through a partnership 
        with the state workforce and led by Andra Cornelius, vice 
        president for business relations at Workforce Florida, the act 
        requires all school districts to have at least one career 
        academy that prepares students for high-wage, high-skill jobs 
        within the local economy. The act also requires industry 
        certification to receive enhanced full-time equivalent 
        weighted-funding, and it requires the rigor of articulated 
        coursework with post-secondary institutions. In this way, a 
        functioning pipeline of skilled workers can be established that 
        industry can rely upon to serve its growing workforce needs.
   Flexible teacher-qualification standards are needed that 
        would permit domestic energy industry personnel to teach in the 
        public education system. Additionally, career and technical 
        education courses should be developed so that they meet 
        specific quality standards--such as completion rates and 
        industry and instructor certifications--in order to receive 
        enhanced funding.
   Industry-certification programs are needed in secondary and 
        post-secondary schools. Current academic mandates do not award 
        credit to students who participate in career technical 
        education programs, nor do they provide the time necessary for 
        students to participate realistically in such programs. The 
        credit systems must be modified so that technical credit is 
        awarded as part of a curriculum, thus allowing students who 
        participate in such classes to accrue sufficient credits toward 
        graduation. Technical education programs help students become 
        immediately employable with high starting salaries that often 
        exceed state averages. Such programs also instill technical 
        skills in such students, and the certification would be 
        portable and nationally recognized. Industry certification 
        should be a component of all career technical education 
        programs of study.
   Lastly, school systems need counseling programs to encourage 
        students and their parents to consider these career academy 
        programs. The image of the domestic energy industry as a career 
        should be one of excitement and opportunity, and not anything 
        negative or second class. To facilitate this change in 
        perception, school systems must educate students and their 
        parents about the potential inherent in the energy industry, 
        and how they can pursue a career in which they could earn a 
        good wage.

    In summary, Chairman Bingaman, Ranking Member Domenici and other 
distinguished committee members, your support and action is needed. 
Southern Company and its employees greatly appreciate your commitment 
to this issue. On their behalf, I hope that you will carefully consider 
the matters I have raised and the requests that I have outlined.\5\ In 
the meantime, thank you again for the opportunity to speak with you 
today, and I welcome any questions that you may have.
---------------------------------------------------------------------------
    \5\ A copy of my biography is attached for your convenience at 
Exhibit 4.

    The Chairman. Thank you very much.
    Dr. Ray Stults, please go right ahead.

 STATEMENT OF RAY STULTS, ASSOCIATE DIRECTOR, ENERGY SCIENCES, 
        NATIONAL RENEWABLE ENERGY LABORATORY, GOLDEN, CO

    Mr. Stults. Thank you, Senator Bingaman. It's a pleasure to 
be here to provide some information regarding the development 
of renewable energies as we meet the current projected energy 
demands of the U.S. and the world with tremendous growth, as 
projected, and particularly as we start to relate to 
considering the energy security and the climate change issues 
that we believe that renewable energy will play a strong role 
in the future.
    Ideas of the investment that's going to be required have 
been provided by such agencies as Inter-Governmental Panel on 
Climate Change, which has estimated a $30 billion--$30 trillion 
investment between now and 2030, of which over $5 trillion of 
that will be in the U.S. in energy infrastructure. So, the 
projections of growth are certainly there, and we're already 
seeing growth in the renewable energy.
    For example, wind power in the last 5 years has enjoyed an 
annual growth rate of 22 percent, 27 percent last year, and 
we're seeing a tremendous growth this year. Although, what's 
really interesting, is on this growth and investment of over $4 
billion in the wind industry, is that if we look at the Energy 
Information Agency's projections, that by 2030, the 
contribution from renewable energies is almost stagnant. Today 
it's about 6 percent and they're projecting only a 7 percent 
growth. Now, we're seeing growth in selective sectors of this 
because the overall energy portfolio--overall energy demand is 
growing, but yet the amount of energy renewables is not 
projected to grow.
    However, I think that's going to change and it's going to 
change by one, the awareness of the need for green energy and 
renewable energies. It's always going to change by initiatives, 
such as the American Competitiveness Act, the Advanced Energy 
Initiative, and so forth. That's a major part of what's 
currently going on at our laboratory right now.
    As you know, we're a National Laboratory and the primary 
focus of what we work on is developing new energy technology 
options for the future. So on wind, solar, biomass, geothermal, 
we're heavily involved in developing, you know, new energy 
options for the future. Only recently have we started to 
address the workforce issues, as we develop these new 
technologies and we start to build plants.
    So, what I would like to do now is to talk a little bit 
about one example, and that's the example in the biofuels area 
where there's been tremendous amount of interest in the last 
several years. Energy renewable--Office of Energy Efficiency 
and Renewable Energy is investing in pilot-scale facilities. 
The Office of Science has invested in advanced bioenergy 
centers in the United States. We've recently done an analysis--
and this is a preliminary analysis of what it would take to 
replace 20 percent of our transportation fuels by ethanol by 
2017--so we've done an analysis of this, and basically what it 
talks about, is how do we produce 20 billion gallons of 
cellulosic ethanol, put it into the marketplace, and then have 
the mechanisms to use that energy.
    Let me just give you a few numbers. Now, these numbers are 
not in my written testimony, I actually received these last 
night when I arrived in Washington, DC and there's some 
information. But I thought I should try to share these. If 
we're going to produce 20 billion gallons of ethanol by 2017, 
we're going to require developing on the order 400 new 
refineries. The stainless steel requirements will equal 8 
percent of the annual U.S. production of stainless steel to 
build those refineries. In some years, the peak will be more 
like 30 percent of the development. We will need 600,000 tons 
per year of concrete to build those plants. Once they're 
operational, the demands on water is significant, 80 billion 
gallons of water per year to do the processing, OK?
    Construction labor--this is averaged out over that 10-year 
growth period, will be 10,000 personal labor-years per year. 
Then once the plants are operating, we'll need 12,000 person-
years of labor each year to operate the plants. So, I think 
those numbers are quite staggering and sort of goes along with 
everything we've been hearing this morning about the demand on 
trained skilled workforce.
    In addition, we're going to need dispensing units in the 
form of new gasoline pumps to dispense this. So this analysis, 
in order to use this, says that by 2015, we need to have E-10 
available nationally, and we need to have E-85 pumps available 
in many regions of the country. That's on the order of 30,000 
stations, investing somewhere between $300 and $600 million 
just to put in the pumps to provide this. Flex-fuel vehicles 
will need to be available. It's projected that by 2017, we'll 
need to have nearly 93 million flex-fuel vehicle on the road in 
order to take advantage of this.
    So, I think the numbers are staggering and it sort of 
accents the problem, and certainly contributes to the demand 
for skilled workforce to build the plants, to operate the 
plants, and so forth.
    The last thing I would like to comment on is something that 
we're seeing at our laboratory, and that is the projected 
shortage of scientists and engineers in this field. We're 
already seeing a workforce demand. We need additional 
scientists and engineers in our National Bioenergy Center, for 
example. We have numerous positions we're working to fill. It's 
going a lot slower than we would like. So, there is a work 
labor issue in the science and engineering.
    So, I think these are all issues that we need to address in 
the future and this is, by a lot of the comments today, I'm 
summarizing this, so, anyway, I applaud the committee. I think 
this is the first of several hearings, meetings, workshops 
that's going to be necessary as we start to address these 
issues, and I certainly look forward to answering any 
questions.
    Thank you.
    [The prepared statement of Mr. Stults follows:]

Prepared Statement of Ray Stults, Associate Director, Energy Sciences, 
            National Renewable Energy Laboratory, Golden, CO
    Mr. Chairman, thank you for this opportunity to discuss workforce 
issues related to our Nation's growing energy needs. I am Ray Stults, 
Associate Laboratory Director for Energy Sciences at the National 
Renewable Energy Laboratory (NREL) in Golden, Colo. NREL is the U.S. 
Department of Energy's primary National Laboratory for research and 
development of renewable energy and energy efficiency technologies.
    The challenges we face today in the energy sector are unprecedented 
in our Nation's history. While we clearly must produce tremendous 
amounts of new energy to serve our citizens and keep our economy 
growing, we at the same must strive to reduce our dependence on 
imported oil and take new measures to protect our environment.
    As we look to the future, the demand for new energy technologies, 
and especially clean energy technologies, is expected to grow 
exponentially. A study conducted this year by the Intergovernmental 
Panel on Climate Change estimated that from 2007 until 2030, the global 
need for new energy infrastructure will total some $20 trillion 
dollars. New energy infrastructure needs in the U.S. were projected to 
be $5 trillion.
                 renewable energy--a look to the future
    The Nation is increasingly looking for solutions from renewable 
energy technologies, and wind, biomass and solar energy industries are 
growing at rapid rates. Although the renewable energy sector is a long 
way from realizing its ultimate potential, these varied industries 
already are having significant impact. Wind power, for instance, over 
the past five years has enjoyed an annual growth rate of 22 percent. In 
2006, U.S. wind power generating capacity rose by some 27 percent. The 
wind power industry this year anticipates U.S. investment of $4 
billion, with 2,454 megawatts of new generating capacity installed. 
Wind power will be the second largest source of new generation in the 
Nation--second only to natural gas--for the second year in a row.
    While it is difficult to predict long-term growth of any particular 
technology in the marketplace, several studies are providing insight 
into the future. Perhaps the most inclusive review of workforce demands 
from renewable energy development was conducted in 2004 by the Energy 
and Resources Group of the Goldman School of Public Policy, University 
of California, Berkeley. Incorporating the work of some 13 existing 
studies, that examination found that even least-case scenarios of 
renewable energy development will create a major new employment sector 
in the future.
    The University of California study analyzed the employment needs of 
renewable energy industries if they were to achieve a 20 percent market 
penetration by 2020--a goal of various policy initiatives at the state 
level. With biomass contributing 85 percent, wind 14 percent and solar 
1 percent of total renewable energy production, the study indicated 
that 52,530 jobs would be created in construction and manufacturing, 
and 188,317 jobs created for facility operations and maintenance.
    The study also found job creation to be generally greater for 
renewable energy expansion, as compared to fossil fuels development, 
per unit of energy delivered. (A study by NREL's Energy Analysis Office 
likewise found economic benefits from encouraging renewable energy 
development. In a comparison of renewable energy development verses 
fossil energy development, it was found that for every equivalent of 
one megawatt produced, fossil energy development generates 25.4 job 
years per additional megawatt capacity; renewable energy 41.7 job 
years.)
    Another valuable assessment of renewable energy growth is DOE's 20 
Percent Wind Scenario, which looks at wind power's potential to meet 20 
percent of the Nation's electricity needs. The 20 Percent Wind Scenario 
found direct employment would be created for nearly 150,000 people, in 
manufacturing, construction and operation of wind power systems--jobs 
that largely would extend over a period of 20 years or more. (The total 
U.S. electric power sector currently employs about 395,000 people.) The 
indirect and induced economic activity that would result from that 
level of investment in wind power would create an additional 300,000 
jobs. The overall economic activity that would be created from wind 
development, if it were to reach 20 percent of total generation, was 
estimated to approach, and could potentially exceed, $1 trillion.
    In addition to the workforce needs of manufacturing and operations, 
the equally crucial need for new related infrastructure must also be 
considered. No definitive research has been completed in this area. 
However, a look into one aspect of biofuels development begins to 
reveal the complexities and workforce demands ahead. The Department of 
Energy's ``20 in 10'' goal of displacing 20 percent of the Nation's 
gasoline use by 2017 would require that 30 billion gallons of E85 be 
sold annually. That would require an estimated 28,500 service stations 
to be equipped to dispense ethanol. The cost of labor for installing 
new tanks averages $20,894 per station; the labor cost for retrofitting 
existing tanks averages $7,771. Overall estimates of labor costs 
associated with providing enough ethanol pumps at the Nation's gas 
stations range from $220 million to $600 million, according to NREL's 
Center for Transportation Technologies and Systems.
                       skilled labor requirements
    As the renewable energy sector grows to meet more of the Nation's 
energy requirements, there will be new demands for skilled labor. While 
few detailed studies exist of future skilled labor requirements, 
several assessments have been initiated. One demonstrated area of 
concern is the gap between existing workforce skill sets and those 
needed for emerging energy industries. The wind power industry, for 
example, will require substantial growth of both skilled labor and 
technical labor, and create new demands for engineering and scientific 
professionals.
    Research by the Renewable Energy Policy Project (REPP) analyzed the 
likely distribution of benefits throughout the U.S. manufacturing 
sector that will result from wind power development. Because 
manufacturing of wind turbine components is a labor-intensive process, 
some significant manufacturing has gone to foreign facilities. At the 
same time, U.S. firms are attempting to increase productivity at 
domestic production facilities--to outweigh the advantageous labor 
costs of foreign competitors. One wind blade manufacturer with 
significant international manufacturing experience estimates that the 
labor hours per blade would need to be reduced by a third for a U.S. 
factory to remain competitive. To ensure that manufacturing jobs remain 
in this country, development of advanced manufacturing technologies is 
essential.
    To address the projected shortage of skilled workers for the 
biomass fuels industry, a number of educational programs have been 
initiated at the state and local level. For example, Indian Hills 
Community College constructed the Iowa Bioprocess Training Center in 
2002, and began offering a two-year bioprocess technician program, 
working with two local ethanol producers. Another school, Minnesota 
West Community and Technical College, worked with local ethanol 
producers and the Minnesota Coalition for Ethanol to create a two-year 
Renewable Energy Technology program. A third of program's initial 
students moved on to a related four-year program, two-thirds were 
immediately hired in the ethanol industry.
    On the national level, DOE has created a program to improve and 
expand solar installer training and certification in cooperation with 
the North American Board of Certified Energy Practitioners (NABCEP). 
Similarly, NREL is working through the U.S. Department of Labor's 
Workforce Innovation in Regional Economic Development, or WIRED 
Initiative, to ensure that skills of the emerging renewable energy 
industries will be addressed. The WIRED Initiative supports innovative 
approaches to education and workforce development that serve the needs 
of employee and employers alike.
    We recommend a detailed analysis be conducted of skilled labor 
requirements for the renewable energy industry, now and into the 
future. A comprehensive, multi-industry assessment of the need for new 
craft and skilled workers is essential to inform national policy in 
this critical area.
                engineers and scientists for the future
    The steady decline of engineering program enrollment comprises a 
major concern for therenewable energy industry. A report published by 
the National Science and Technology Counsel in 2000 found that the 
percentage of 22-year-olds earning degrees in science and engineering 
will continue to fall over the next four decades. Currently, U.S. 
graduate power engineering programs produce about 500 engineers per 
year. During the 1980s, this number approached 2,000 annually.
    This issue poses risks to U.S. competitiveness. The number of wind 
engineering programs at European schools is significantly greater than 
that offered in the U.S. Although our Nation has historically been a 
world leader in providing broad access to higher education, and in 
attracting foreign students, other countries are closing the gap, by 
providing comparable educational access to their own population and 
attracting large numbers of foreign students.
    The nascent biofuels industry in the U.S. already is encountering a 
shortage of qualified engineers and scientists with the appropriate 
education and training to make the contributions that are needed in the 
field. A looming shortfall of potential biofuels researchers in the 
undergraduate system today will only be compounded as industry ramps up 
its hiring demands in the future. At our own National Laboratory, we 
have experienced a severe shortage of qualified candidates for 
technical and scientific positions within the National Bioenergy 
Center, and competition for qualified candidates is only expected to 
intensify in the years to come. Just as Petroleum Engineering served 
this Nation for decades as an important discipline, so too must a new 
``Biofuels Science and Engineering'' discipline become an attractive 
and fulfilling educational and career path for our emerging workforce.
    NREL is currently working with the research and consulting firm 
Independent Project Analysis, Inc. (IPA), to help DOE better understand 
the challenges associated with commercialization of new biofuels 
technologies. IPA focuses on the quantitative analysis of capital 
projects worldwide, including energy projects, and conducts extensive 
research on the factors that influence project success. Through this 
work, we are finding that shortages of technically qualified workers 
are currently having significant impacts on the costs and schedules of 
capital projects, such as power plants, chemical plants and refinery 
upgrades. In one striking example, data suggests the cost of 
engineering labor on the U.S. Gulf Coast more than doubled between 
January 2004 and June 2007, due to a shortage of qualified design 
engineers. Such labor issues are likely to be compounded as the 
biofuels industry expands.
    We recommend a detailed national study be initiated to identify 
potential shortages of crucial engineering and scientific 
professionals. Study results would provide policy makers with the 
information they will need to ensure an adequate workforce is available 
to meet the Nation's future energy needs.

    The Chairman. Thank you very much.
    Ms. Berrigan, go right ahead, please.

      STATEMENT OF CAROL L. BERRIGAN, Director, Industry 
            Infrastructure, NUCLEAR ENERGY INSTITUTE

    Ms. Berrigan. Chairman Bingaman, Ranking Member Domenici, 
and members of the committee, I am Carol Berrigan, Director of 
Industry Infrastructure at the Nuclear Energy Institute. I 
appreciate this opportunity to express the nuclear industry's 
views on the availability of the workforce necessary to meet 
our Nation's growing energy needs.
    Let me begin by thanking members of this committee for 
their long-standing vision and leadership, which has shaped our 
national energy policy, most recently embodied in EPACT 2005. 
We commend the enactment of the America Competes Act, which 
establishes a solid policy framework for addressing the 
challenges in stem workforce, and we look forward to this Act's 
implementation.
    In addition, this committee has long supported nuclear 
engineering education in university programs and we encourage 
you to continue to reinforce the importance of these programs 
with the Department of Energy.
    The 104 reactors operating in the United States today are 
among our Nations safest and most secure industrial facilities. 
In addition, they are the Nation's lowest cost producer of 
base-load electricity. Nuclear power produces one-fifth of 
America's electricity and U.S. utilities are preparing to build 
advanced design nuclear power plants to meet our Nation's 
growing energy needs.
    According to EIA estimates, U.S. electricity demand is 
expected to grow by at least 40 percent by 2030. Meeting new 
demands for electricity will require energy providers to make 
major investments in new power plants, as well as transmission 
and distribution systems. Nuclear energy holds great potential 
for meeting our Nation's climate- related goals. Today, nuclear 
energy represents over 70 percent of the Nation's emission-free 
generation.
    Given concerns about climate change and the need for 
affordable and reliable base-load electricity production, 
policymakers and energy industry leaders are evaluating an 
expanded role for nuclear energy. Both NRG and TVA have taken 
concrete steps toward this expanding role, with the submission 
of combined operating license applications for new nuclear 
reactors to be built in Texas and Alabama. There are currently 
15 other companies or consortia who have announce plans to 
submit COLOs for up to 27 additional nuclear power plants 
across the country.
    Since the interest of this committee is in the availability 
of workforce necessary to meet our Nation's growing energy 
needs, please note that while the nuclear industry faces 
several challenges in meeting its nuclear workforce demands, 
along with these challenges come significant opportunities for 
American workers.
    Each nuclear unit in operation today, directly employs 400 
to 700 people. In addition to direct employment, the nuclear 
industry relies on numerous vendors and specialty contractors 
for additional expertise. For maintenance and outages, nuclear 
power plants also require a skilled labor to complement onboard 
utility staff, in some cases as many as 1,000 additional 
workers.
    NEI's 2007 nuclear workforce survey indicated that 35 
percent or 19,600 current nuclear utility employees may be 
eligible to retire by 2012. Within the vendor community that 
supports the industry, that number is 25 percent.
    The resurgence of nuclear energy will also lead to 
increasing demand for skilled labor at all levels. NEI 
anticipates that each new nuclear unit will require 1,400 to 
1,800 workers for construction, with peak employment of up to 
2,300 workers.
    If the industry were to construct the 31 units that are 
currently being discussed, it would require roughly 43,000 to 
56,000 workers during construction with peak employment over 
71,000. Once built, these plants would require roughly 12,000 
to 22,000 permanent workers.
    One area that's often overlooked in considering the nuclear 
workforce, is the manufacturing jobs that new nuclear 
construction would generate. According to a DOE survey in 2004, 
deploying 33 to 41 new nuclear units through 2024 could 
generate as many as 37,000 to 38,000 nuclear manufacturing 
jobs.
    Jobs in the industry also have many desirable attributes. 
They are well compensated and commonly include family medical 
benefits, pensions, and generous incentive compensation plans.
    Across the energy sector, there is growing demand for 
technical workers. The nuclear industry, like the rest of 
American industry, faces increasing competition for engineering 
talent, but we do see some good news.
    In nuclear engineering programs, we see a fourfold increase 
in enrollment at the B.S. level, and a fivefold increase in 
enrollment at the graduate level.
    Within the skilled crafts, however, there are challenges 
remaining. At the same time that demographics-driven attrition 
of skilled crafts is rising, numerous reports--as you've heard 
in various testimony--indicate a growing demand for skilled 
labor. Recruitment into skilled crafts has several challenges, 
the first is a lack of awareness and prestige for these 
important occupations.
    The shift in national attention toward skilled craft 
employment, compounded by some State government policies, and 
various interpretations of Federal policies has led to the 
elimination of many high school career and technical programs, 
further reducing the qualified pool of skilled craft 
applicants.
    The industry also faces hurdles due to our need for high-
quality rigorous technical and personal standards.
    I'd like to--in the interest of time--skip down to talk a 
little bit about what the industry is doing. The industry is--
--
    The Chairman. Why don't you give us a short version of 
that, we're over the 5 minutes, go right ahead.
    Ms. Berrigan. I certainly will.
    The industry has taken aggressive actions in addressing the 
future workforce, pursuing initiatives in career awareness, 
developing training programs, providing financial support and 
scholarships, and developing regional and State-based workforce 
initiatives. We also actively work with the Center for 
Workforce Development, that you've heard mentioned elsewhere, 
and we're an active participant in the Southeast Skilled Trade 
Summit.
    Mr. Chairman, in conclusion, I encourage you in this 
committee to continue your legacy of leadership on this issue, 
through greater national attention, and coordinated efforts of 
Federal and State government, industry, organized labor, and 
the educational community, we can and will build our future 
energy workforce.
    Thank you.
    [The prepared statement of Ms. Berrigan follows:]

      Prepared Statement of Carol L. Berrigan, Director, Industry 
                Infrastructure, Nuclear Energy Institute
    Chairman Bingaman, Ranking Member Domenici and members of the 
Committee, I am Carol Berrigan, Director of Industry Infrastructure at 
the Nuclear Energy Institute. I appreciate this opportunity to express 
the nuclear industry's views on the availability of the workforce 
necessary to meet our Nation's growing energy needs.
    Let me begin by thanking the Members of this Committee for their 
long-standing vision and leadership which has shaped our national 
energy policy most recently embodied in the Energy Policy Act of 2005. 
Key provisions in this legislation have accelerated the nuclear 
renaissance, including Title XVII loan guarantees, the production tax 
credit and regulatory risk insurance.
    We commend the enactment of the America Competes Act, which 
establishes a solid policy framework for addressing the challenges in 
the science, technology, engineering and math (STEM) workforce and we 
look forward to this Act's implementation. In addition, this Committee 
has long supported nuclear engineering education and university 
programs, and we encourage you to continue to reinforce the importance 
of these programs with the Department of Energy.
    The 104 reactors operating in the United States today are among our 
Nation's safest and most secure industrial facilities. In addition, 
they are the Nation's lowest cost producer of base-load electricity, 
averaging just 1.72 cents per kilowatt-hour. Those 104 nuclear power 
plants produce one-fifth of America's electricity, and U.S. utilities 
are preparing to build advanced-design nuclear power plants to meet our 
Nation's growing electricity demand.
    According to EIA estimates, U.S. electricity demand is expected to 
grow by at least 40 percent by 2030. Meeting new demands for 
electricity will require energy providers to make major investments in 
new power plants, as well as in the transmission and distribution 
systems used to deliver electricity where it is needed. Cambridge 
Energy Research Associates estimates that, nationwide, the electric 
power industry will invest approximately $750 billion in infrastructure 
projects through 2020, with $250 to $300 billion in expenditure for new 
generation.
    Nuclear energy holds great potential for meeting our Nation's 
future climate related goals. Today, nuclear energy represents over 70 
percent of the Nation's emission-free generation portfolio, avoiding 
3.12 million short tons of Sulfur Dioxide, .99 million short tons of 
Nitrogen Oxide and 681 million metric tons of Carbon Dioxide compared 
to the fossil fuels that would have been burned in the absence of 
nuclear energy.
    Climate change is increasingly important as federal, state and 
local policymakers consider energy supply and greenhouse gas 
mitigation. Given those concerns and the need for affordable and 
reliable base-load electricity production, policymakers and energy 
industry leaders are evaluating an expanded role for nuclear power.
    Both NRG and the Tennessee Valley Authority have announced that 
they have taken concrete steps toward this expanding role with the 
submission of Combined Operating License Applications for new nuclear 
reactors to be built in Texas and Alabama. There are currently 15 other 
companies or consortia who have announced plans to submit Combined 
Operating License Applications for up to 27 additional new nuclear 
power plants across the country.
    Since the interest of this Committee is the availability of the 
workforce necessary to meet our Nation's growing energy needs, I will 
begin by describing the size of the workforce needed to support the 
current nuclear industry and new nuclear construction. While the 
nuclear industry faces several challenges in meeting its future 
workforce demands, along with these challenges are significant 
opportunities for American workers.
    Current Nuclear Power Plants:--Each nuclear unit in operation today 
directly employs 400 to 700 people.\1\ In addition to direct 
employment, the nuclear industry relies on numerous vendors and 
specialty contractors for additional expertise and services. For 
maintenance and outages, nuclear plants also require skilled labor to 
compliment onboard utility staff, in some cases as many as 1,000 
additional workers over a 4 to 8 week period, depending on the scope of 
the outage work. Based on an extrapolation of data supplied from the 
Associated Maintenance Contractors, over 30 million man-hours are 
worked by supplemental craft labor each year at the Nation's 104 
nuclear reactors.
---------------------------------------------------------------------------
    \1\ For some single unit sites, the number of workers may exceed 
1000. In addition to direct employment, each plant creates economic 
activity that generates roughly an equivalent number of additional jobs 
within the local community and produces approximately $430 million 
annually in expenditures for goods, services and labor, and through 
subsequent spending because of the presence of the plant and its 
employees. The average nuclear plants also contributes more than $20 
million annually to state and local tax revenue, benefiting schools, 
roads and other state and local infrastructure and provides annual 
federal tax payments of $75 million.
---------------------------------------------------------------------------
    NEI's 2007 nuclear workforce survey indicated that 35 percent or 
19,600 current nuclear utility employees will be eligible to retire 
within five years (2007 to 2012). In addition, the industry continues 
to experience non-retirement attrition, which over the same five-year 
period may require replacement of an additional 11 percent of the 
nuclear utility workforce or 6,300 workers. Within the vendor 
community, the NEI survey indicated that roughly 25 percent of the 
workforce would be eligible for retirement by 2012.
    New Nuclear Power Plants:--The resurgence of nuclear energy will 
lead to increasing demand for skilled labor at all levels. Depending on 
the build technique selected, NEI anticipates that each new unit will 
require between 1,400 and 1,800 workers for construction with peak 
employment of up to 2,300 workers. Some estimates with a shortened 
timeline and little use of modularized construction techniques have 
peak construction estimates at 4,000 workers per project. These jobs 
include skilled crafts such as welders, pipefitters, masons, 
carpenters, millwrights, sheet metal workers, electricians, 
ironworkers, heavy equipment operators, and insulators, as well as 
engineers, project managers, and construction supervisors.
    If the industry were to construct the 31 units that are currently 
being discussed for COL applications, this would require 43,400 to 
55,800 workers during construction with peak employment of up to 
71,300. Once built, these 31 plants would require 12,400 to 21,700 
permanent fulltime workers to operate the plants and additional 
supplemental labor for maintenance and outages.
    Manufacturing:--One of the areas that is often overlooked in 
considering the workforce impact of new nuclear construction are the 
manufacturing jobs associated with the nuclear industry. These jobs 
include the manufacture of components including pumps, valves, piping, 
tubing, insulation, reactor pressure vessels, pressurizes, heat 
exchangers, and moisture separators to name a few, and commodities like 
cement, structural steel, steel reinforcing bar, stainless steel, cable 
tray and cabling. According to a 2004 report from Idaho National Lab 
and Bechtel Power Corporation, if the industry were to deploy 33 to 41 
new Generation III units through 2024, this could create 37,000 to 
38,000 nuclear manufacturing jobs in the U.S.
    About the Jobs:--Jobs in the nuclear industry have many desirable 
attributes; they are well compensated and commonly include family 
medical benefits, pensions and generous incentive compensation plans. 
Today, the median salary for an electrical technician at a nuclear 
power plant is $67,517, for a mechanical technician, it is $66,581 and 
for a reactor operator, it is $77,782. A senior reactor operator's 
median income is $85,426. Jobs in the nuclear industry are safe with 
fewer reported accidents than numerous other industries, including 
banking and other white-collar occupations.
    Challenges and opportunities:--Across the energy sector, there is a 
growing demand for skilled technical workers.\2\ Many of the challenges 
facing the development the future STEM workforce are identified in the 
National Science Foundation's ``Gathering Storm'' report. The nuclear 
industry, like the rest of American industry, faces increasing 
competition for engineering talent, while the supply of this talent 
remains static.
---------------------------------------------------------------------------
    \2\ Skilled technical workers include both degreed and non-degreed 
personnel.
---------------------------------------------------------------------------
    Despite the challenges noted in the NSF report, there is good news. 
We are seeing the resurgence of interest in nuclear careers at the 
college and graduate engineering level, most notably evidenced by the 
rapidly increasing enrollments in nuclear engineering programs. 
According to a recent study by the U.S. Department of Energy, 
enrollments in undergraduate nuclear engineering programs have grown 
from just 470 in the 1998 to 1999 academic year to 1,933 in the 2006 to 
2007 academic year. Graduate enrollments have also climbed from 220 in 
the 1998 to 1999 academic year to 1,153 in the 2006 to 2007 academic 
year. The Bureau of Labor Statistics Occupational Outlook Handbook 
indicates median earnings for nuclear engineers are amongst the highest 
for all engineering disciplines at $84,880 per year.
    Within the skilled crafts,\3\ challenges remain. Demand for skilled 
craft labor centers on three activities: construction, operation and 
maintenance. These activities are common to all energy infrastructure 
types, including fossil power, transmission, distribution, pipelines, 
petrochemical refining and nuclear power. Skilled craft labor, 
particularly for construction and plant outage maintenance (or 
turnarounds), is able to work on all types of energy infrastructure.
---------------------------------------------------------------------------
    \3\ Examples of skilled craft labor include Boilermakers, 
Carpenters, Chemistry Technicians, Electrical Maintenance Technicians, 
Electricians, Heavy Equipment Operators, Instrumentation and Control 
Technicians, Insulators, Ironworkers, Lineworkers, Masons, Mechanical 
Maintenance Technicians, Millwrights, Non-Destructive Examination 
Technicians, Pipefitters, Power Plant Operators, Process Technicians, 
Quality Assurance Technicians, Quality Control Technicians, Radiation 
Protection Technicians, Sheet Metal Workers and Welders.
---------------------------------------------------------------------------
    According to NEI's 2007 nuclear workforce survey, up to 39 percent 
of nuclear utility maintenance workers, 34 percent of radiation 
protection workers and 27 percent of operations staff may reach 
retirement eligibility within five years.
    Non-utility skilled craft labor will likely be impacted by 
demographics-driven attrition as well. A report from the Construction 
Labor Research Council estimates that up to 185,000 new construction 
craft workers will be required nationally to replace the 95,000 
retiring workers and deliver the necessary 1 percent to 2 percent 
workforce growth between 2005 and 2015.\4\
---------------------------------------------------------------------------
    \4\ ``Craft Labor Supply Outlook 2005-2015,'' Construction Labor 
Research Council, 2005.
---------------------------------------------------------------------------
    At the same time that demographics-driven attrition of non-utility 
skilled crafts is rising, numerous reports indicate a growing demand 
for skilled craft labor on a regional or national basis. Figure 1 
illustrates anticipated demand for various types of industrial 
construction and maintenance workers in the Southeast. Although project 
demand after 2011 is difficult to forecast, many strong indications 
point to growing demand. When adding the expected rate of worker 
attrition to the estimates, the supply-demand imbalance is even more 
pronounced.
    The nuclear industry draws its supplemental skilled craft labor and 
will draw its construction labor for new nuclear plants from the same 
labor pool that supports the rest of the energy sector. The 
demographics-driven attrition and growing demand that affects the 
skilled craft labor pool will have an impact on the nuclear industry.
    Recruitment:--Recruitment into skilled crafts has several 
challenges. The first is a lack of awareness and prestige for these 
important occupations. A shift in cultural norms associated with 
skilled labor careers has contributed to the shrinking craft labor 
pool. Parents, guidance counselors and society in general push high 
school students to complete their secondary education with the 
intention of then attending a four-year college program. High-paying 
skilled labor jobs, once considered excellent career options, are now 
perceived as second class.\5\ This shift in focus, compounded by some 
state government policies and varying interpretations of federal 
policy, has led to the elimination of many high school career and 
technical programs. That, in turn, further reduces the number of 
qualified applicants for skilled craft positions.
---------------------------------------------------------------------------
    \5\ ``Where Have all the Welders Gone,'' Wall Street Journal 
Online, Aug. 15, 2006.
---------------------------------------------------------------------------
    The nuclear industry faces additional hurdles. Specifically, there 
are few workforce training programs focused on the skills needed for 
successful employment in the nuclear energy industry due to the 
industry's rigorous technical and personnel standards.\6\
---------------------------------------------------------------------------
    \6\ The nuclear industry is required to meet rigorous training and 
qualification standards for personnel. These standards are set by the 
Nuclear Regulatory Commission and the National Academy of Nuclear 
Training. In addition, some personnel must meet qualification 
requirements established by international standards organizations such 
as ASME and ANSI.
---------------------------------------------------------------------------
    As the entire energy industry works to replace its aging workforce 
and plans for new facilities and infrastructure, the overall decline in 
high quality career and technical education and a general perception 
that skilled crafts represent less valuable career choices have 
combined to restrict the pool of applicants for skilled crafts jobs.
    Individuals often incorrectly perceive skilled labor jobs in the 
energy sector to require little or no post-secondary training. In fact, 
these jobs require certifications, offer high pay with benefits and 
provide opportunities to earn college credits. In an era of rapidly 
escalating college costs, the advantages of energy sector skilled craft 
jobs are poorly communicated to potential entrants, particularly as 
high school students are directed almost exclusively toward four-year 
degree programs. Improving awareness of skilled craft jobs in the 
energy sector and changing this misperception will undoubtedly lead to 
more students electing to enter skilled craft careers and enjoying 
long-term, high-wage employment.
    Industry Response:--The commercial nuclear industry is taking 
aggressive action to develop its future workforce. The industry has 
been pursuing a variety of initiatives to increase career awareness 
through direct outreach efforts with professional societies, in high 
schools, and through the internet and other media. The industry has 
developed training programs and partnerships through high schools, 
union apprenticeship programs, skills centers, community colleges and 
universities. The nuclear industry also provides financial support and 
scholarships to students and is actively developing and engaging 
regional and state-based workforce development partnerships.
    In March 2006, the Center for Energy Workforce Development (CEWD) 
was established. It is a partnership between the Nuclear Energy 
Institute, the Edison Electric Institute, the American Gas Association 
and the National Rural Electric Cooperative Association. CEWD is a non-
profit organization that teams with secondary and post-secondary 
educational institutions, organized labor and the workforce system to 
create effective solutions to address the need for a qualified, diverse 
workforce. CEWD programs include: career awareness, identification and 
replication of model programs and processes, and support for regional 
and state workforce development partnerships. CEWD also endeavors to 
identify and address gaps in national workforce data and promotes 
policies that support energy workforce development.
    In August 2007, the Nuclear Energy Institute, the Edison Electric 
Institute and the American Petroleum Institute co-sponsored the 
Southeast Energy Skilled Trades Summit in Biloxi, MS. This Summit, 
hosted by the U.S. Department of Labor and the State of Mississippi, 
brought together nearly 300 key stakeholders from industry, organized 
labor, government, and the educational community to raise awareness 
about opportunities in the energy skilled crafts and develop concrete 
solutions to the energy skilled craft workforce challenges in the 
region. This Summit was the first step in an ongoing process that has 
lead to the establishment or enhancement of numerous state-based 
consortia that are working to implement innovative workforce 
development solutions locally. The industry, in partnership with the 
Department of Labor, is also investigating replication of this summit 
in other regions of the country.
    Recommendations:--Taken together, these programs represent an 
enormous investment of time and money in the future workforce of the 
industry, but more is needed to develop the technical and skilled 
crafts workforce that our Nation will need to deploy additional 
generating capacity, including nuclear. Specifically, we must:

   raise awareness of the impending skilled craft labor 
        shortage and its impact on the energy sector
   elevate the image, status and prestige of skilled craft 
        careers in the energy sector
   attract, recruit and train workers, particularly from 
        untapped and under-represented labor pools
   align investments and workforce development initiatives to 
        ensure collaboration and coordination of government, industry 
        and labor efforts in the develop the energy skilled trades 
        workforce
   build partnerships between industry, government, organized 
        labor and the education community that promote talent and 
        economic development
   implement performance-based education and training programs 
        for skilled craft workers through vocational and technical 
        education programs in secondary and post-secondary educational 
        environments (including high schools, pre-apprentice, 
        apprentiship, and community college programs).

    Some have argued that wages for skilled crafts have had a negative 
effect on attracting new workers into the industry. The Nuclear Energy 
Institute and the American nuclear industry have a long, mutually 
beneficial relationship with our workers and with the unions associated 
with the nuclear industry sector. Our members believe that prevailing 
wages have a stabilizing effect in the nuclear construction industry by 
promoting good labor relations, encouraging workforce training and 
supporting skilled worker retention. On behalf of our members, the 
Nuclear Energy Institute supports prevailing wages for this skilled 
workforce and agrees with the inclusion of the prevailing wage 
provision for new nuclear projects covered by Title XVII loan 
guarantees.
    Mr. Chairman, in conclusion, I encourage you and this Committee to 
continue your legacy of leadership on workforce and competitiveness 
issues. Through greater national attention and the coordinated efforts 
of federal and state government, industry, organized labor and the 
educational community, we can and will build our future energy 
workforce. Successfully addressing this challenge will enhance our 
national competitiveness and train tens of thousands of workers for the 
kinds of high-skill, high-wage jobs that built this Nation.

    The Chairman. Thank you very much.
    Mr. Hunter, you're the clean-up hitter here, so go right 
ahead.

PREPARED STATEMENT OF JAMES L. HUNTER, DIRECTOR, INTERNATIONAL 
               BROTHERHOOD OF ELECTRICAL WORKERS

    Mr. Hunter. All right. Thank you very much.
    Good morning, Mr. Chairman and members of the committee. My 
name is James Hunter, I'm the Director of the International 
Brotherhood of Electrical Workers utility department. I've been 
asked by our President, Ed Hill, to speak today on behalf of 
the IBEW, and I want to thank you for holding this hearing, 
it's very, very important.
    The IBEW represents 720,000, more than 220,000 of them in 
the utility industry. The IBEW provides a view of the utilities 
from inside, that we think is unique.
    We see the workforce shortages from a very different 
perspective. The 1990s move toward deregulation caused the 
utilities to slow down hiring, offer early retirements to 
reduce staff, and a radical curtailment in new infrastructure.
    The IBEW believes we are facing a critical manpower 
shortage in the utility industry today, and it is getting worse 
day by day.
    Our information shows that average age of a lineman in the 
industry is over 51 years old. A line worker must be highly 
skilled and trained to perform their physically and mentally 
challenging job. It's a job that requires extensive safety 
training and on-the-job training.
    It takes over 10 years of experience to become a lead 
lineman. A study from Carnegie Mellon which charts up there, 
shows employment levels in the industry peaked about 1990 at 
550,000. It's declined steadily to today's numbers of about 
400,000.
    The interesting point here is that the total generation 
increased during that same time by about 30 percent, while 
employment levels dropped by 23.7. On face value, it would 
sound like we're doing more with less. But, the truth is, the 
companies have achieved these levels by working enormous 
amounts of overtime, and reducing maintenance and construction. 
The next generation of utility workers must be hired and 
trained today.
    The situation is also dire in the generation sector. We've 
heard NEI has done a couple of studies showing that over 35 
percent of the plant workers will be eligible to retire within 
5 years.
    The IBEW knows it takes 4 to 5 years to train just to the 
journeyman level. Proof again that we need to hire today, to 
replace the workers that are leaving in 5 years.
    NEI's data also shows that 76 percent of all of the craft 
workers in the nuclear plants are over 43 years old.
    Jeff Sterba, the Chairman and President and CEO of 
Albuquerque-based PNM Resources, recently spoke to a group of 
IBEW leaders and said that his company faces the grim reality 
that within 5 years, 50 percent of his workforce will be 
eligible to retire. He said, though, that that really doesn't 
both him. What bothered him was that within 10 years, 85 
percent of his workforce will be eligible for retirement.
    You can see from the other chart, our industry is 
different. We have a huge bubble of retirees coming up. The 
IBEW has been working with employers to attract people into the 
industry, and train then. We've started some regional training 
centers, a concept, it looks to partner with the utilities to 
help train the new generation of workers.
    We see community colleges and resources as a good resource 
but not training centers in the practical sense. Many of our 
job require hands-on training that can not be taught in the 
classroom. IBEW President Hill has said many times that kids 
need to be taught how to work.
    We understand that being taught by experienced craftsman is 
by far the best way to convey skills. The utilities must start 
to do some workforce assessments, and implement plans to hire 
and retain the future workers in our industry. The IBEW is 
working with the Center for Workforce Development, CWD, which 
is a partnership of all facets of the utility industry. CWD has 
just released a comprehensive study of the energy workforce, 
that I think is very revealing.
    The IBEW is also at the forefront of anticipating staffing 
needs on construction projects. The key to working with 
employers long before projects start. We need to have a--we 
have a program that forecasts construction projects over the 
next few years, to determine how many construction workers will 
be needed, in any given area of the country. We then work with 
employers to ensure that we have enough trained and qualified 
workers available.
    The committee has also questioned the use of foreign 
workers. The IBEW believes that the worker shortage we're 
seeing in the United States is an issue that can be addressed 
by retraining, and including unemployed workers displaced by 
outsourcing, and shipping jobs overseas. Therefore, training 
workers domestically now to meet the coming demand, is where 
the industry and Congress should e focusing.
    If America is serious about reducing carbon emissions, we 
will need to build thousands of wind turbines and solar rays, 
along with new nuclear plants. A transition to carbon-free 
generation will require different skill sets and training. 
While the IBEW is working with companies such as Sharp and 
others, to develop training classes, we know that the need for 
new skills are enormous.
    Funding assistance is needed to implement and operate the 
necessary training programs, and it's important for Congress to 
work closely with labor and industry to attract, train and 
retain the workers in the energy industry.
    Thank you very much.
    [The prepared statement of Mr. Hunter follows:]

    Prepared Statement of James L. Hunter, Director, International 
                   Brotherhood of Electrical Workers
                   critical energy workforce shortage
    Good morning Mr. Chairman and Members of the Committee: My name is 
James Hunter and I am the Director of the International Brotherhood of 
Electrical Workers (IBEW) Utility Department. I have been asked by our 
President, Ed Hill to speak to you today on behalf of the IBEW. Thank 
you for inviting us to comment this morning.
    Of the 95 percent of investor-owned electric utilities that employ 
union members, the IBEW represents 98 percent of those workers. We also 
represent the largest number of unionized employees working for 
municipal and rural cooperative employers; the IBEW also represents 
workers at federal electricity facilities, such as the Tennessee Valley 
Authority (TVA) and Bonneville Power Administration (BPA). Of the 
720,000 members of the IBEW, more than 220,000 of them are utility 
workers, who are covered by some 1,400 collective bargaining agreements 
in the United States and Canada.
                               situation
    The IBEW provides a view of the utilities from the inside that we 
feel is unique. We see the workforce shortages from a very different 
perspective the demand for trained skilled workers is rapidly expanding 
in the utility sector. The 1990s move toward deregulation caused the 
utilities to slow down hiring, offer early retirements to reduce staff, 
and a radical curtailment in new infrastructure. The IBEW believes we 
are facing a critical manpower shortage in the utility industry today, 
and that it is getting worse day by day. Our information shows that the 
average age of a lineman in the industry is over 51 years old. A Line 
worker must be highly skilled and trained to perform their physically 
and mentally challenging job. It is a job that requires extensive 
safety and on the job training. It takes over 10 years of experience to 
become a lead lineman. A study from Carnegie Mellon in 2005 showed that 
employment levels in the industry peaked in 1990 at about 550,000 
employees, and has declined steadily to today's numbers of about 
400,000. The interesting point here is that total generation increased 
30 percent while at the same time employment levels dropped by 23.7 
percent. On face value it sounds like we are doing more with less. But, 
the truth is the companies have achieved these levels by working 
enormous amounts of overtime and reducing maintenance and construction. 
The next generation of utility workers must be hired and trained soon. 
Workers will be needed to replace those who will be leaving the 
workforce and to bolster the additional numbers needed to repair, 
maintain, and build the new energy infrastructure needed for our 
future.
    The situation is also dire in the generation sector. The Nuclear 
Energy Institute (NEI) completed a study showing over 35 percent of 
their plant workers will be eligible to retire within five years. The 
IBEW knows that it takes four to five years to train to the journeyman 
level in most utility jobs. Proof again that we need to hire today to 
replace the workers leaving in five years. NEI's data shows that 76 
percent of craft workers are 43 years old or older.
    Jeff E. Sterba, chairman, president and CEO of Albuquerque-based 
PNM Resources recently spoke to a group of IBEW leaders and said that 
his company faces the grim reality that within five years 50 percent of 
his workforce would be eligible to retire, and that 85 percent will be 
eligible within 10 years.
                          suggested solutions
    The IBEW has been at the forefront of the employment issue for 
years. We are working with employers to attract people into our 
industry, and to train them. We have started a regional training center 
concept that looks to partner with the utilities to train a new 
generation of workers. We see community colleges and universities as a 
good resource, but not training centers in the practical sense. Many of 
our jobs require hands on training that cannot be taught in the 
classroom. IBEW President Hill has said many times that kids need to be 
taught how to work. We understand that being taught by experienced 
craftsmen is by far the best way to convey skills.
    The utilities must start to do workforce assessments and implement 
plans to hire and retain the future workers in our industry. The IBEW 
is working with the Center for Workforce Development (CEWD). CEWD is a 
partnership between all facets of the utility industry; electric, gas, 
investor owned, co-ops, public power and labor. CEWD has just released 
a comprehensive study of the energy workforce that you can obtain from 
their web site www.cewd.org We believe that working together with our 
employers and the federal government we can be successful.
    The IBEW is also at the forefront of anticipating staffing needs on 
construction projects. The key is working with employers long before 
the projects start. We have a new program that forecasts construction 
projects over the next few years to determine how many construction 
workers will be needed in any given area of the country. We then work 
with employers to assure we have enough trained and qualified workers 
available.
    The committee has questioned the use of foreign workers. The IBEW 
believes that the worker shortage we are seeing in the United States is 
an issue that can be addressed by retraining and including unemployed 
or underemployed workers displaced by outsourcing and shipping jobs 
overseas. Therefore, training workers domestically, now, to meet the 
coming demand is where the industry and Congress should be focusing.
    The IBEW is diligently and actively recruiting new workers with job 
fairs, DVDs, websites like ElectrifyingCareers.com, and even the 
sponsorship of a race car in its attempt to get a few moments in front 
of America's youth. Recruitment sites like ElectrifyingCareers.com give 
broad descriptions of dozens of positions available within the industry 
and provide easy steps to get more information. The site even tailors 
its information to the specific needs of students, parents, counselors, 
and people interested in making a mid-life career change to the skilled 
trades. Additionally, a website founded and supported by the Building 
and Construction Trades Department of the AFL-CIO called 
HelmetsToHardhats.com is specifically designed to recruit people 
leaving the military, a group that is known for their responsible work 
ethic and a ``team'' mentality that leads to success in the 
construction industry. These online outreach programs are often the 
first step toward attracting employees to the electrical industry, 
because they provide information necessary to make smart decisions 
about their future.
    If America is serious about reducing carbon emissions we will need 
to build thousands of wind turbines, and solar arrays along with new 
nuclear plants. A transition to carbon-free generation will require 
different skill sets and training. While the IBEW is working with 
companies such as Sharp and others to develop training classes, we know 
that the need for new skills will be enormous. Funding assistance is 
needed to implement and operate the necessary training programs. It is 
important for Congress to work closely with labor and industry to 
attract, train, and retain workers in the energy industry.

    The Chairman. Thank you very much for your testimony.
    Let me ask a question of Mr. Szydlowski, first. You have a 
suggestion here in your testimony that we provide IRS relief on 
phased retirement initiatives. You say we need the help of 
these older workers in preparing the new workers--we can't ask 
them, the older workers, to jeopardize their pension benefits, 
nor their tax-qualified status or pension plan.
    Could you be a little more specific about what you're 
recommending we do? Do you have people who are approaching 
retirement age, and who want to start drawing retirement while 
they're still on the company payroll, is that the idea?
    Mr. Szydlowski. Yes, Senator, it's an opportunity to--I 
think you may have mentioned this earlier in some of your 
comments for older workers to not work full-time, but at the 
same time, have some access to their retirement benefits.
    Today there's a change with the Pension Protection Act, 
which comes into force on January 1, 2008, and I think the 
final regulations, I think will be out this week, but I 
understand that the retirement age is set at 62. If the 
retirement age, for example, was set at 55, that would allow an 
opportunity for workers in that range--55 to 62--to work at 
some amount of time in these roles where they may not want to 
work full-time, but at the same time, they could help an 
organization like ours--Colonial Pipeline--do training, keep up 
with ongoing work, but not risk their pension, lump sum.
    To try and explain that just a bit more, the challenge and 
a lot of anxiety in companies like ours where 55 is a special 
age, because people are allowed to retire, there's concern 
about the value of their lump sum benefit. The new Pension 
Protection Act changes the discount rate--changed it from 
Treasury's to investment rate bonds. That will be an overall, 
somewhat a reduction, it looks, in terms of what the lump sum 
will be worth, and there's anxiety.
    There's anxiety that I'm not quite sure what my benefit 
will be in the future, so it's an incentive to me to retire 
now, take my benefit, and most of these people, Senator, go 
back to work. They can't come back to work, in our case, for 
Colonial, they may go work for a competitor, they may go work 
for a contractor. They're still eager to contribute, they're 
not ready to retire. But there's an odd--I would call it a 
disincentive in our retirement system today, which is 
encouraging them to leave early.
    The Chairman. Thank you for explaining that, and I'll try 
to look into that and understand it better. If you have 
anything written up on that issue, I'd be anxious to get it.
    Mr. Szydlowski. Yes, I do, I'd be glad to send it.
    The Chairman. OK, thank you very much.
    Senator Domenici.
    Senator Domenici. I just wanted to follow-up, because you 
said a couple of things that I was surprised at. To whom does 
the 55 year retirement apply? All of the workers in the company 
you're talking about?
    Mr. Szydlowski. In our company, Senator Domenici. We have--
as many companies in our industry have--55 has been set as the 
eligibility date for a person to retire, the soonest date that 
they can draw on their retirement benefits. So, it's our--that 
55 is our date. It's frequently used, at least in our industry.
    Senator Domenici. Now, what industry is yours, which part 
of it?
    Mr. Szydlowski. This would be petroleum and oil and gas.
    Senator Domenici. Don't you think that is kind of early?
    [Laughter.]
    Senator Domenici. Considering the problems we're having? I 
mean, it seems to me we ought to be thinking about some way to 
let them work longer, and not jeopardize their pension, is that 
what you're talking about?
    Mr. Szydlowski. Absolutely, I couldn't agree more. I think 
that's the purpose for bringing this subject up. Because, these 
are folks that are at a time when I think they're very, very 
productive, we see them as a wonderful asset and resource, and 
we don't want them to leave. We'd rather have them--their 
highest and best use is to stay with the company they're with.
    Senator Domenici. Senator Bingaman's on the committee that 
looks at that, so I assume he will look at that, you raise a 
very good issue.
    Could I ask you, Mr. Hunter, I'm very concerned about, 
well, I'm old enough to have lived through Lyndon Johnson's 
programs--what did he call his ideas? The Great Society? One of 
the efforts was to establish training centers all over the 
country, because it was thought that the schools, the regular 
schools, weren't properly training people for jobs--you go 
through high school, you weren't trained for a job, you go 
through community college, you weren't--and then we went 
overboard, we had three or four different agencies setting up 
job training centers. So, when I was mayor of Albuquerque, 
there were at least four that were funded and were out there 
trying to train people, and they didn't know what the hell they 
were training them for.
    So, one time they reported in, they were training women to 
be hairdressers? I said, ``That's fine, how many are you 
training?'' I know the little town they were training them for 
couldn't use more than 6, 7. They said, ``We've got at least 50 
that we're training for Espanola,'' and I said, ``You expect 
them to work for hire? Fifty of these hairdressers?'' They 
said, ``We don't know, but the ladies like it.''
    Do you envision or see something that we ought to be doing, 
by way of the Federal Government getting involved in the 
establishment of training centers, or paying for half of the 
cost or in some way being involved. I've been dreaming about 
this, and I'm befuddled but yet as to what the Federal role 
might be. Know the labor unions are involved, and should be 
involved, because most workers at a nuclear power plant are 
unionized, and we ought to see what the union has to do about 
training them.
    Are you the lead union, in terms of training in these 
fields? Or would we need to get more information as to what 
programs you all have, and the unions have?
    Mr. Hunter. Traditionally the IBEW, we're obviously, by far 
the largest in the electrical sector, and we have always 
trained electricians, we've had our own apprenticeship programs 
and trained internally.
    We've never really been involved in the utility side, 
because utilities always hired the employees and they trained 
them themselves.
    Senator Domenici. I see.
    Mr. Hunter. Now, we're starting to see more and more of a 
trend to try to use community colleges, Southern Company, for 
instance, because of the grants in the State, are, you know, 
kids can come right out of high school, get a grant, go into a 
community college, and they've partnered up with the community 
college, along with, you know, the IBEW folks that, you know, 
we've got poles in the community colleges that the kids can 
actually climb, they've got bucket trucks, they can see and 
feel what is the job, even at that level.
    That type of concept is what we're looking at to be able to 
take, especially a six week class, a boot camp, and get the 
kids out, show them what the industry is all about, what the 
jobs are about. Because we've got a tremendous drop-out rate. 
The kids go into the schools after the first couple days, it's 
like, you know, ``No, this isn't what I want to do.'' So, we're 
trying to look at how do we orient them to the job, see that 
they are interested in the job, get them through drug tests and 
entrance-level tests and all of those things with an 
experienced person that can actually convey to them, what does, 
what's it like working in a nuclear plant?
    Senator Domenici. OK.
    I don't want to take too much time, but I assume that we 
have had testimony on, by previous witnesses looking at the 
list, that talk about job training, and how that's done out 
there? What did the Secretary of Labor say about the Federal 
Government having--did she talk about programs that we already 
have for training workers?
    The Chairman. Dr.----
    Senator Domenici. Secretary----
    The Chairman. [continuing]. DeRocco. She spoke about a 
variety of programs the Department of Labor has to train people 
in skills that are relevant to the energy sector, and I think 
the representative from the Department of Energy did, as well.
    Mr. Szydlowski. Senator, I might add that they have focused 
on the energy sector, and really have that they have focused on 
the energy sector and really have directed funds and 
assistance, if you will, on heightening the awareness of the 
opportunities within the sector, plus creating a dialog within 
the Southeast, particularly, with the Southern Governor's 
Association, to heighten their interest in funding 
opportunities for different programs. So, they've done a good 
job of heightening the interest.
    Senator Domenici. I've been thinking about whether there 
was a role for the United States to establish something like an 
Energy Worker Training Act, and then figure out what it would 
do to help the States and the junior colleges, community 
colleges, and the like, get involved in the kind of training we 
need. I still think maybe there is a role, but we have to look 
at that and see what we could do. We'll talk to the unions, 
obviously.
    Let me ask Dr. Stults, you know, I was really caught by 
surprise recently when I asked about the wind turbines and wind 
energy in the United States. You state about how much it was 
growing, but the truth of the matter is, that there's a backup 
there in orders where you have to wait a long time to get 
turbines, right? Two years, I understand? So, even a simple 
thing like buying the parts for a windmill, you have to wait 
and most of it comes from other countries, right?
    Mr. Stults. Correct.
    Senator Domenici. It's imported.
    Mr. Stults. Yes.
    Senator Domenici. The thing that drives it all, and puts 
these companies in business is this tax credit, right? That's 
the principal thing that's driving wind energy. I would assume, 
therefore, that you would recommend an extension of the credit, 
would you not?
    Mr. Stults. Certainly. Anything that we can do to stimulate 
and for the----
    Senator Domenici. Because, it runs out and you probably 
need it for more than just 6 or 8 or 10 months, you need it for 
a couple of more years, and maybe beyond that, right?
    Mr. Stults. We'll need it for extensive time in order to 
also establish the manufacturing capability and enhance that, 
and so that we have advanced manufacturing capabilities to 
overcome the labor cost difference between offshore and in the 
United States.
    Senator Domenici. Would a company like Southern, Mr. 
Bowers, join with a local unit of government that was trying to 
train people, and put Southern in it, so that they could train 
for what you need?
    Mr. Bowers. Yes, sir.
    Senator Domenici. Is that kind of thing being done?
    Mr. Bowers. Yes, sir, they are. We're joining in the State 
of Alabama and Georgia with the local communities and high 
schools, creating academies and training initiatives to try to 
get people in this sector.
    Senator Domenici. Now where does the money come from to do 
the training? Is that grants that they get from the Federal 
Government, or do you know?
    Mr. Bowers. There is grants available for them from the 
Federal Government, as well as State funds as well. We fund 
some of that activity.
    Senator Domenici. You fund some?
    Mr. Bowers. Yes, sir.
    Senator Domenici. How about you, Ms. Berrigan? You must be 
out there checking to see what's available for nuclear and be 
very worried that we don't have enough trained people. Is that 
a fair statement?
    Ms. Berrigan. I think that we're paying attention to what 
the numbers look like and tracking the issue closely. We're 
also working to share best practices directly with our members, 
as well as through the Center for Energy Workforce Development 
on effective means to develop the workforce programs that are 
necessary to train the workers. So it's definitely an issue 
that we're paying very close attention to and we're expending a 
lot of resources on.
    Senator Domenici. If you're looking out there--this is my 
last question, Mr. Chairman--if you're looking at all this, 
could you tell us what is the principal way that business is 
now training for these skilled jobs. What's taking place out in 
the marketplace? Do you all know?
    Ms. Berrigan. There are a number of different approaches 
that people are taking toward developing a workforce for these 
skilled jobs. They include programs like--the program that's 
run through the Central Virginia Community College system, that 
starts in the high school, continues with the Community College 
program. Then it's something that we like to call a two-plus-
two effort, where after they get an associates degree, it's 
articulated so they can go on for a bachelors degree and 
beyond. That's one model of a regional-based initiative. Others 
are focused on more coordination on a--on a wider scale, using 
both union apprenticeship, training centers, as well as 
community colleges and their local university systems.
    Senator Domenici. One last question of anybody that knows 
enough about it to tell me. What is the Center for Workforce 
Development and who pays for it and what does it do?
    Mr. Bowers. The Center for Energy Workforce Development is 
a consortium of groups. The EEI, the Edison Electrical 
Institute, AGA, the NRAECA, the National Rural Electric 
Cooperatives, IBEW, other unions are joint together to heighten 
the issue and awareness around workforce shortage and workforce 
training. That group was formed approximately 2 years ago and I 
was the initial chairman of that group.
    Senator Domenici. Great.
    Ms. Berrigan. If I can add. That group is--NEI is also a 
partner in that group. I serve as the Vice President of the 
Center and it's funded by utility contributions as well as 
contribution from the participating associations.
    Senator Domenici. Does it work?
    Ms. Berrigan. Seems to be working pretty well so far.
    Senator Domenici. What do you think, Mr. Bowers?
    Mr. Bowers. It's created a momentum and awareness within 
the industry as a whole. I think it has gained a lot of status 
within the sectors to create an opportunity for us to go 
forward.
    Senator Domenici. So are you telling young people what 
you've got? Is that what it is? What kind of jobs they might 
expect and----
    Mr. Bowers. There are Web sites where it highlights the 
opportunities for careers in the energy sector, absolutely.
    Ms. Berrigan. There's also a branding campaign that CEWD 
has launched just, I guess it was about 2 weeks ago at their 
annual summit, to educate young people about career 
opportunities in many of the key areas important to the utility 
sector.
    Senator Domenici. Positively my last question. What's the 
pay scale? If you're telling some teenagers or young adults 
that they don't have good jobs, and you're saying, ``You ought 
to get trained for the utility industry somewhere out there 
because they're better jobs.'' What are they? How much does an 
ironworker job on a nuclear power plant make if it's unionized 
and they're hired to do the principal work on a plant?
    Mr. Hunter. I can tell you from the utilities sector, which 
I came from PEPCO here in the Washington area. I would say that 
our average lineman across the country is making well over 
$100,000. Power plant operators--and again, now that's with a 
lot, a substantial amount of overtime. So, spending a lot of 
hours on the job.
    Senator Domenici. Experience.
    Mr. Hunter. Yes. But $100,000 plus is very reasonable.
    Mr. Bowers. Senator Domenici, the wage rates are, for 
electricians, $25 to $30 an hour, pipe fitters are in the $35 
to $38 an hour range. You get per diems, that could push that 
up to almost $45 to $50.
    Senator Domenici. So, that's the kind of information you 
can throw out there to people that are looking at it, if you 
have a way of getting it to them.
    Mr. Bowers. Absolutely.
    Senator Domenici. If you're working at a job paying minimum 
wage plus $2, think of us. We pay four times as much or 
whatever it is. Right?
    Mr. Hunter. I think the CEWD Web site, if you get into it, 
it's really neat. It sends the kids--and it's, we're in 
cooperation with Google, and the kids are, if they're looking 
for a job, just playing on the Web site. They'll get into the 
Web site. It's takes them in, it asks them a bunch of 
questions. Do you enjoy working outdoors, working with your 
hands, computers, whatever. Then after that, it will steer them 
and start telling then about different jobs in the utility 
industry. It will have streaming video where you'll have an 
overhead lineman standing there telling what his job is and 
that. It does have pays, you know, approximate pay scales and 
that. Then it will also, if you want to continue on down the 
road, it will actually send you to locations of the country 
where you can Google earth and I'm, you know, living in 
Atlanta, Georgia. I'm interested in a job here. Here's all the 
companies in that area that are hiring, both electric and gas.
    Senator Domenici. Thank you.
    Thank you, Mr. Chairman.
    The Chairman. Thank you very much.
    Senator Murkowski, you're our final questioner.
    Let me just indicate that any Senator who has additional 
questions would be asked to submit those by the close of 
business tomorrow.
    I'm going to have to duck out and make a phone call, so why 
don't you conclude the hearing, Senator Murkowski.
    Senator Murkowski [presiding]: Thank you, Mr. Chairman.
    The Chairman. I thank all witnesses.
    Senator Murkowski. My questions will be brief. You have 
been very patient with all of us, but your information has been 
very helpful. I think as Senator Domenici has pointed out, 
there's great stuff out there that just needs to get to the 
right place.
    Mr. Bowers, you mentioned the term stigma. We've got to 
change the attitude. In so many of the trades, the attitude is 
``you can do better than me.'' We've got to be working with the 
folks that are working at Colonial and Southern Electric and 
within IBEW, those folks that have young children or teenagers 
or those that are preparing to go into the marketplace. We 
don't need them saying ``you can do better than me.''
    You know, this has been the American Dream, you want to do 
better than your parents. But by saying that, in a way you're 
denigrating the fact that you've been a linesman and you had a 
good and a honorable respectable profession, and did well by 
your family. We need to make sure that in our actions, our 
statements, our cartoons, plumbers aren't looked at very 
favorably in many of the cartoons. How did that ever come 
about? I don't know why. But gosh, what is a plumber making 
nowadays?
    I digress, but I think this is an issue that we've got to 
focus on. In the State of Alaska, our estimates are that about 
70 percent of the kids that are graduating from Alaskan high 
schools are choosing not to go on to college. Recognizing that 
as a reality, are we preparing them to take on the career 
opportunities that really are available through the technical 
and the skilled occupation. We need to be doing a better job 
with them.
    I serve on the HELP Committee, as does Senator Bingaman. 
This panel would be great to have in front of the Health, 
Education, Labor Pensions Committee, as we talk about 
reauthorization of No Child Left Behind. A focus from the 
Administration on some very core academic areas, so that we can 
get you all moving toward college.
    That's great, but what happens if you're a kid that isn't 
destined for college, for whatever reason? We've got to have 
the guys that are keeping the lights on and keeping the 
temperatures cool and comfortable so that all these brainiacs 
can do what they need to do from the policy perspective.
    I'm really singing to the choir here, but I wanted to ask 
generally, to any of you who may wish to respond. From an 
education policy perspective in this Nation, with our focus 
towards standards, are we doing enough to prepare young people 
to go into the fields that you need them in? Or when they come 
to you, whether it's for training through the IBEW, do you have 
to prep them for the training that they will then encounter? 
Mr. Hunter, you're nodding.
    Mr. Hunter. Absolutely. You know, we have probably about 40 
percent of the people, there's a caste test that EEI has as an 
entrance level, which is really basic math, basic reading, 
fundamental skills. We have over 40 percent of the kids that 
take it fail. So that becomes a part of what we have to do 
early on, is----
    Senator Murkowski. So you do remedial within your training 
programs, then?
    Mr. Hunter. Yes, we have to, or you can't get them passed 
through the caste test.
    Senator Murkowski. What about you, Mr. Bowers, in the 
academy that you all have put together there through Southern?
    Mr. Bowers. That is a vehicle from a voc-tech skills 
training platform where most of the schools have really stopped 
providing that as a curriculum. Focused on getting the credits 
for graduation that leads to higher education, i.e. college. I 
think we've got to get back to the basic fundamentals, that 
it's OK to have vocational training and you get credit for 
graduation and we also supplement, with our workforce, going 
into those classrooms and trying to train our young folks about 
the opportunities and get them upgraded in their skills.
    Because fundamentally, like Mr. Hunter said, they are 
failing the simple math and reading and just mechanical 
concepts. They don't have a clue about what it takes to be 
productive in this United States, especially in the energy 
sector.
    Senator Murkowski. Yet, if you could get a curriculum that 
has some relevance to them, they see where the math skills 
could be taking them to a good, high-paying job, whether it's 
in the nuclear industry or working pipelines. That gives them 
the incentive to not only stay in, but to focus on the academic 
curriculum that they need.
    I'm a little concerned that with this needs assessment of 
the workforce shortage that we're not really projecting out 
adequately, because we don't really know what we're going to 
anticipate, whether it's in nuclear or wind or solar or 
geothermal. That what we are hearing today about the very 
dismal forecast is going to play out and be even worse than we 
think it might be. Do you think I'm right or am I being 
pessimistic this morning?
    Mr. Szydlowski. If I might take a try at this, Senator. No, 
I think you're quite right, although I have to say this is a 
good problem to have. This idea of growth and trying to find 
our way to expand and do more and provide more, I think is a 
good problem. As opposed to trying to contract and other. But I 
think we have a--I think we have a pretty good idea of the 
kinds of needs, the kinds of skilled craft, the kinds of 
welders and so on, those skill trades that are necessary.
    I want to comment on your thought on the stigma. Because I 
think there's something that everybody can do and it doesn't 
take a Federal program, necessarily, to do it. But if you look 
around this room, I would say everybody here is probably guilty 
of sort of a stigma of a college-educated person versus someone 
that's in a voc-tech. I am. I have a son who's 21-years old. 
The last four or 5 years, I'm sure he convinced he's been a lot 
wiser than I am.
    But Andy was smart about one thing. He got accepted in good 
schools, he went, he did it, one semester he did terribly, 
didn't like it. Today, he works two jobs. He goes to Cincinnati 
State, which is a community college, to be an automotive 
mechanic. He's never made less than an A in any of his courses 
and I couldn't be more proud of him.
    Senator Murkowski. That's great. That's great.
    Senator Domenici. He's got a good job.
    Senator Murkowski. Yes.
    Mr. Szydlowski. He will have a good job.
    Senator Murkowski. Yes.
    I thank you all. You're right, it could be worse. We could 
be faced with a different situation where we didn't have the 
great resource that we have with our young people, and just 
need to help focus them in the right direction.
    Thank you all.
    Senator Domenici. One final observation. It's not like all 
these things I've seen and heard about lead me to what we ought 
to do. I think it's a very complicated subject because I think 
it's even a high school issue and it's very hard to get high 
schools to conceive of the idea that they ought to go forward 
with some vocational education. That's perceived to be 
backward, right? That's not forward. But it's forward right now 
for 30 or 40 percent of the kids, because if they get this, 
they might work in their life. If they don't get it, they might 
not, you know. That's 30 or 40 percent.
    I was in an elevator in Albuquerque at a big Intel plant. 
In walked four people, all dressed in the suit that they wear 
to go into the clean room, C-L-E-A-N, clean room. They all 
looked about 35, about 34, something like that. I introduced 
myself and I turned around and started talking to each one and 
they were training to go to work for Intel at, a program that 
they each would start at $42,000, $38,000 or $42,000. I said, 
``That's interesting''--to this one--``what did you do before 
you applied for this job?'' He said, ``I got a Bachelor of Arts 
from Michigan.'' ``University of Michigan?'' ``Yes.'' ``Oh. 
You're doing this?'' ``Yes, best job I can find and much better 
than anything I can find with the degree that I got.'' Everyone 
was degreed and none could find a better job than training for 
a high-level job with Intel and work in clean rooms and the 
like.
    You know, very interesting, they aren't mad at anybody, but 
someone like me does wonder, are we misleading those people, 
especially when the next 10 years we don't have to mislead them 
about what they could do because we know. They could get 
terrific jobs. You just told us what they get paid. Especially 
if they start young and by the time they're 30 they're already 
very experienced, that they make very good money if they work 
on a nuclear power plant, right?
    Mr. Bowers. Absolutely.
    Senator Domenici. They're in the union, they get all the 
benefits, and they go to the next job. I think we're going to 
have to realize that we either talk our kids into it with 
programs that are meaningful or we're going to have to find 
somebody else to do the jobs. I know we don't want to do that. 
I know you don't. But, you know, it might be that that's what 
immigration does for this country, if we get that off, you 
know, far enough down in the direction of not having anybody 
that wants these kind of jobs.
    I thank you for yielding.
    Senator Murkowski. Thank you.
    With that, we're adjourned.
    [Whereupon, at 12:10 p.m., the hearing was adjourned.]
                               APPENDIXES

                              ----------                              


                               Appendix I

                   Responses to Additional Questions

                              ----------                              

     Responses of W. Paul Bowers to Questions From Senator Bingaman
    Question 1. You note on page 3 of your testimony that the demand 
for skilled workers in the Southeast was 120,000--20,000 short for 2007 
and that the demand is expected to grow to 170,000 by 2011. How serious 
are weather and other disruptive events like Katrina on the 
availability of skilled workers and how long does the disruption 
typically last?
    Answer. Southern Company must continually monitor weather and 
weather-related events in order to prepare for and respond to any 
disruption caused to the planned operation of the electrical system. Be 
it through high temperatures and their impact on load; continuing 
drought and its impact on hydroelectric and other generating resources; 
or severe storms and tornados and their impact on generation and 
transmission facilities, weather impacts can require the redirection of 
resources and skilled craft personnel to address and resolve sudden 
problems caused by the weather.
    Catastrophic events such as Hurricane Katrina only magnify the 
disruption caused to the electrical system, and as might be expected, 
deplete the available skilled craft workforce required for generation 
activities such as maintenance, new generation resource construction or 
environmental retrofit construction. Initially, such workers are called 
upon for emergency restoration and clean-up efforts. Over time, those 
efforts are replaced by the need for the restoration of infrastructure, 
as well as the reconstruction of commercial and residential facilities. 
Although Southern Company's labor market analyses do not track the 
demand for skilled craft labor associated with Katrina recovery and 
restoration, Southern Company expects the labor market to experience 
increased competition from Katrina-related projects for years to come. 
However, it should be emphasized that the shortfalls described in my 
testimony are baseline figures (regional generation construction 
projects and other major industrial plant activities) that do not 
factor in projected workforce commitments that would be required in the 
aftermath of another catastrophe like Katrina.
    Question 2. You note on page 5 of your testimony that only around 
40% of applicants could pass entrance for employment at Southern--are 
these for skilled labor positions? Can you please explain what these 
tests typically consist of?
    Answer. Southern Company utilizes two different employment tests as 
part of its consideration of potential new skilled labor hires: the 
CAST (Construction and Skilled Trades Selection System) aptitude test 
for Transmission and Distribution candidates; and the POSS-C/MASS 
(Plant Operator Selection System/Power Plant Maintenance Selection 
System) test, which includes an aptitude test as well as a background 
and experience questionnaire for Generation candidates. These tests 
were developed specifically for the electric utility industry by 
investor-owned electrical utilities (including Southern Company) in 
conjunction with the Edison Electric Institute, and have been utilized 
effectively throughout the industry for the past 20 years.
    CAST is a cognitive ability test that measures specific candidate 
faculties that are predictive of job performance for Distribution and 
Transmission positions in the electric utility industry, including 
graphic arithmetic, mathematical usage, mechanical concepts and reading 
for comprehension. The CAST test contains a total of 110 questions and 
takes approximately 2.5 hours to administer.
    POSS-C/MASS is a combined test battery that measures both cognitive 
faculties as well as background and experience that are predictive of 
job performance for Plant Operations and Maintenance positions in the 
electric utility industry, including math usage (short and long), 
assembly, mechanical concepts, tables & graphs, reading comprehension, 
and background and opinion questionnaire (total of 402 questions). The 
POSS-C/MASS test contains a total of 402 questions and takes 
approximately 3.5 hours to administer.
    Candidates are not expected to complete each question in each test, 
and candidates are not penalized for unanswered questions. Each test 
component is weighted in such a way as to maximize the prediction of 
job performance. The scores on each component are combined to achieve a 
raw score. This means that strong performance in one test component can 
compensate for weaker performance on another test component. Candidate 
scores are compared to the cutoff score established by Southern Company 
to determine those who are recommended for further consideration.
    It is worth adding that applicants who have completed specialized 
training programs, such as the academies in Florida affiliated with 
Gulf Power Company, have a significantly higher passage rate of the 
entrance tests than applicants without such instruction. In the case of 
Southern Company's Gulf Power Academy graduates, passage rates approach 
100 percent.
    Question 3. On page 6 of your testimony you note that high paying 
skilled craft work is seen as undesirable as a profession--what would 
recommend to alter that image?
    Answer. Altering the image of skilled craft work as undesirable 
will require concerted efforts of industry, educators and governmental 
leaders toward changing that perception as it exists among those 
entering the general workforce. One way to change that perception is to 
increase awareness and understanding of what skilled craft work entails 
and what levels of compensation are commensurate with the work. 
Specifically, and as I noted in my testimony, many individuals do not 
recognize the fact that skilled craft work can be high paying, often in 
excess of state averages, with competitive benefit packages. A national 
advertising campaign may be one way to tackle this issue. Ideas 
circulating about the industry for which federal assistance would of 
significant value include a ``Get Into Energy'' campaign, as well as an 
umbrella campaign titled ``We Build America'' that encompasses a number 
of industries into a larger group of potential skilled labor careers.
    Another approach is to ensure that such career options are 
integrated into the career awareness processes employed at the middle 
and secondary school levels and presented as a viable career option to 
students. Students often choose a course of study as early as the 
eighth grade that can determine whether or not they will have the 
academic and technical skills required by our careers. Unless students 
and their parents are fully informed about the avenues available within 
the energy industry, candidates who might consider learning the 
technical skills that would be useful for such a career could be 
missed. To accomplish this objective, funding assistance for the 
placement of career counselors at middle and secondary schools, as well 
as community colleges, would be of great assistance.
    Southern Company also has sought to alter the negative opinion of 
utility industry careers through its creation of, and involvement in, 
technical programs for secondary students. With the support of 
educators, the success of efforts can only grow. However, as I 
explained in my testimony, many schools have begun to phase out, or 
already have phased out, technical programs, in order to comply with 
certain federal and state educational standards that do not accommodate 
a technical education curriculum. Thus, federal and state policymakers 
need to work with educators and with those in industry to develop and 
implement workable solutions that allow students to pursue technical 
studies and reward those students who do so and excel. The Career and 
Professional Education Act in Florida is one such example.
    There is also concern that society as a whole has devalued the 
importance of a strong work ethic, particularly associated with the 
labor requirements expected from skilled craft positions. Changing 
perceptions in this respect is a more difficult task, given the 
complexity and magnitude of the issue. Nonetheless, Southern Company is 
involved in several organizations, such as the Center for Energy 
Workforce Development (CEWD) and Construction Users Roundtable (CURT), 
which are exploring ideas associated with a national marketing campaign 
to promote energy industry careers. As with efforts in the educational 
arena like those discussed above and in my testimony, assistance and 
support from state and federal policymakers is an important component 
to the future success of these and like efforts.
    Question 4. There are skilled manufacturing jobs elsewhere in the 
United States which are loosing employment, whether it is outsourced or 
through declining sales, is it possible to retrain these skilled 
workers for the utility industry?
    Answer. As a general matter, individuals skilled in certain 
manufacturing jobs can be very capable of transitioning into the 
skilled craft positions needed to support the utility industry. In the 
case of Southern Company, its internal staffing recruiters, service 
providers, as well as organized labor supporting its plants make 
efforts to reach out to individuals facing layoffs with manufacturing 
facilities and alert them to the availability of skilled craft work in 
the utility industry. Other industries are doing the same, however, as 
evidenced by the relatively low unemployment statistics in the 
Southeast. On this point, it is notable that employment statistics for 
the month of October showed Alabama with an unemployment rate of 3.1 
percent (compared to the national rate of 4.7 percent).
    The extent to which these efforts can be expanded or improved in 
part depends on the extent to which there are other individuals who 
possess skills and experience that are directly transferable or who can 
be retrained and the costs associated with such retraining. On that 
front, assistance from federal and state authorities would greatly 
facilitate the ability of those in industry to commit the time and 
resources that would be needed to investigate the potential of 
transitioning skilled manufacturing labor to the utility industry, and 
then implementing any required retraining programs in order to bolster 
the actual skilled craft workforce.
    Question 5. On page 12 of your testimony you recommend flexible 
teacher training programs where skilled energy crafts can teach in 
schools--has anyone discussed this with the Department of Education?
    Answer. Although Southern Company is currently working with 
individual state education systems to address this issue, Southern 
Company itself has not had any such discussions with representatives of 
the Department of Education, and is not aware of the extent to which 
discussions have been had with the Department by others in industry. 
Southern Company welcomes the opportunity to do so, and would 
appreciate any direction from this Committee as to whom we should 
direct our inquiries.
     Responses of W. Paul Bowers to Questions From Senator Domenici
    Question 1. In your testimony, you provide an example of how 
Southern Company optimizes its skilled labor through scheduling. Are 
there other examples of how to optimize available labor?
    Answer. In addition to scheduling, Southern Company endeavors to 
optimize its skilled craft labor force through the meticulous planning 
of maintenance and project development tasks. Southern Company also has 
implemented leading industry practices in connection with its 
construction and maintenance management processes. Another way Southern 
Company has optimized its contracted skilled craft workforce is through 
progressive labor agreements for its projects utilizing organized 
labor, as well as the maintenance of a balanced labor posture, using 
both union and non-union labor, for the plants it constructs, operates 
and maintains.
    Question 2. Are you aware of any regional disparities in future 
energy workforce demand? More specifically, will these issues have a 
more profound affect on the Southeast than in other areas of the 
Nation?
    Answer. As discussed in my testimony, the workforce shortages that 
Southern Company foresees are being exacerbated by the confluence of an 
aging workforce and increases in energy demand. These factors generally 
are common across the Nation. However, energy production from electric, 
gas and oil and alternative fuels in the Southeast region is expected 
to increase at higher rates than many other areas. In addition, damage 
from hurricanes striking the Southeast in 2004 and 2005 is estimated at 
over $150 billion. Thus, a regional disparity with respect to 
competition for skilled labor likely is being experienced in the 
Southeast and is expected to continue for the foreseeable future. With 
this increased competition, there also is some expectation that the 
demand for skilled labor will impact the availability of such labor in 
other areas of the country. For instance, regions of the country that 
have relied in the past on skilled workers based in the Southeast to 
serve their projects when need arises will encounter a limited pool of 
workers who may tend to serve the existing (and increasing) projects at 
home, rather than travel in order to obtain work.
                                 ______
                                 
    Responses of Andra Cornelius to Questions From Senator Bingaman
    Question 1. Your testimony on page 17 notes the creation of a 
``Banner Center'' in renewable energy center at the University of 
Central Florida--would you be able to explain this in a little more 
detail?
    Answer. Employ Florida Banner Centers, an initiative of Workforce 
Florida, target industries that are critical to growing Florida's 
diverse economy. They serve as clearinghouses for companies needing 
training and create relevant and rigorous new curricula for training 
entry-level workers as well as those who need to upgrade their skills. 
Each Employ Florida Banner Center, most of which are based at Florida 
community colleges or universities, has an advisory council made up of 
industry leaders along with state and regional education, economic 
development and workforce stakeholders. Banner Centers have the design 
and aspiration to become go-to centers that serve as statewide 
resources for just-in-time workforce training in key sectors. They 
offer an innovative and strong foundation for building the pipeline for 
better-skilled workers in Florida's high-value industries. The 
initiative already is drawing national attention for its innovative 
approach to leveraging partnerships to expand training opportunities. 
The 10 existing centers and the two new programs that are about to get 
under way (one of which is the Banner Center for Alternative Energy) 
all engage educational institutions, businesses, and workforce and 
economic development partners, among others, to provide a focal point 
for industry-specific skills training.
    The Banner Center for Alternative Energy was awarded competitively 
in September 2007 to the University of Central Florida, Florida Solar 
Energy Center, based in part on its mission--to research and develop 
renewable energy, energy efficiency and alternative energy technologies 
that enhance Florida's and the Nation's economy and environment. 
Sunlight is a compelling solution to our need for clean, abundant 
sources of energy in the future. Among this center's deliverables in 
year one will be to focus on solar thermal (solar water heating) and 
photovoltaic device installation and service technician training, in 
partnership with other educational institutions statewide. The 
technicians will be able to receive industry-recognized certification 
from the North American Board of Certified Energy Practitioners. Given 
that Florida will soon be the third largest state in the Nation, and 
that about 53% of energy consumed in Florida is by its residents, solar 
thermal and photovoltaic technologies offer two viable solutions 
provided that more technicians are developed through targeted training. 
Additionally, to spur solar energy uses, particularly among residents, 
the Florida Legislature is becoming more active in the support of solar 
related projects. In the 2006 session, the Legislature appropriated 
$2.5 million for solar hot water and photovoltaic rebates. The 2007 
Legislature continued the rebate program with funding set at $3.5 
million. (To find out more about Employ Florida Banner Centers, go to 
EmployFlorida.com.)
    Question 2. How do you track the success of your program, do you 
have established metrics?
    Answer. The Florida Energy Workforce Consortium, just 18 months 
old, is in process of articulating its benchmarks to track progress on 
goals. We will focus on results rather than process in such areas as:

   Increasing the number of rigorous new career academies at 
        the secondary level in construction and/or electrical 
        technology
   Increasing the number of graduates from training programs in 
        critical occupations
   Comparing the graduates scores on pre-employment tests 
        (e.g., Edison Electric Institute) to those of other applicants 
        and their retention rates
   Increasing the number of industry-recognized certifications 
        awarded
   Employer satisfaction of the graduates from the Employ 
        Florida Banner Center for Energy
   Leveraging and tracking private and public sector funding 
        from energy companies targeted toward workforce development
   Increasing the number of training graduates placed in energy 
        jobs

    Question 3. Do your graduates tend to stay in Florida or do they 
migrate to regions where there is greater demand?
    Answer. Given the growth rates in Florida, our graduates tend to 
stay in our state and very often stay in their region of training. One 
of the early precepts of the Florida Energy Workforce Consortium is 
that given the steady demand for talent in this industry sector, it 
makes good business sense and offers a more lasting solution to grow 
your own workers rather than to poach from each other from a limited 
pool of workers. The ``growing your own'' workforce strategy often 
enables a company to attract people with ties to the area who are 
likely interested in maintaining their roots.
    Question 4. The unions like IBEW have strong apprenticeship 
programs, how does your program work with these union programs--are 
they feeders for the skilled workforce such a utility lineman?
    Answer. The IBEW is an important member of the Florida Energy 
Workforce Consortium due to their historical role in developing talent 
for critical occupations like line technicians. We are learning how to 
further expand the apprenticeship model in Florida, in partnership with 
our energy companies and educational institutions along side other 
innovative talent development models. For example, in June 2002, the 
Florida Legislature, through its Office of Program Policy Analysis and 
Government Accountability, did an analysis of apprenticeship programs 
in the state--both union and non-union--and found that the programs 
were indeed beneficial, but were limited in meeting state demands. The 
Florida Energy Workforce Consortium will be receiving an update from 
the Office of Apprenticeship, Florida Department of Education, at its 
December 2007 meeting, to learn about improvements in the program since 
2002, funding levels and what we can do together to meet the state's 
needs. The demand for workers in critical occupations is such that we 
will need to do all we can, building on traditional models and 
embracing new models, to generate sufficient worker supply.
    Responses of Andra Cornelius to Questions From Senator Domenici
    Question 1. It seems that workforce issues are best addressed at 
the State and local level. What role do you envision for the Federal 
government when addressing energy workforce issues beyond federal 
funding to state programs?
    Answer. Other than federal funding to state workforce training 
initiatives for this industry sector, we offer the following 
suggestions to increase improved performance and accountability:

          1. Encouraging cross-agency workforce solutions (e.g., 
        Departments of Labor and Energy) and co-mingling of funding 
        opportunities.
          2. Streamlining requirements that allow and encourage 
        industry professionals to teach in career and technical 
        education settings.
          3. Allowing the opportunity for academic credits to be given 
        for career and technical education to enable more students to 
        have time on their schedules to accommodate this track.
          4. Mandating that career and technical education result in 
        industry-recognized credentials for graduates (similar to the 
        Florida Career and Professional Education Act) and for 
        participating educational institutions to receive increased 
        funding based on Career and Technical Education (CTE) student 
        hours.
          5. Incentivizing performance accountability that focuses on 
        outcomes rather than process improvements.
          6. Aligning and coordinating investments in energy workforce 
        training and education to reduce duplication and support best 
        practices
          7. Funding and support for utility technology and energy 
        awareness in K-12 to include coal, nuclear and natural gas
          8. Funding and support for energy career awareness in K-12
          9. Funding support for pre-apprentice career and technical 
        education

    Question 2. Are you aware of other programs in other states similar 
to the Gulf Power Academy?
    Answer. I am aware of no other programs in other states similar to 
the Gulf Power Academy in structure, nor performance (outcomes). 
However, one of the first career academy's in the United States was in 
energy so there may be best practices elsewhere from which to learn.
    Question 3. Is there any best-practice data available for state 
programs such as Workforce Florida, Inc.? If not, would it be useful?
    Answer. As the nonprofit, public-private organization charged with 
setting policy and overseeing the state's workforce system, Workforce 
Florida continues to lead through its commitment to accountability, 
responsiveness and innovation. It does so by linking workforce, 
economic development and education strategies through business-driven 
initiatives and programs to ensure Florida's workforce has the skills 
needed to support the state's enterprises and thus the economy. 
Workforce Florida also promotes an environment in which Floridians have 
the opportunity to upgrade their education and skills to obtain jobs 
that lead to greater economic prosperity. This work is supported by key 
workforce system partners--the Agency for Workforce Innovation (state 
agency responsible for administrative and fiscal affairs), the 24 
regional workforce boards (primarily responsible for service delivery) 
and the nearly 100 one-stop centers (bricks-and-mortar gateway to 
services and resources for most businesses and job seekers).
    Here are some of the accomplishments in 2006-07:

   More than 766,000 people were served through a one-stop 
        center, which offers a range of employment and training 
        services to individuals as well as businesses.
   About 75,000 veterans, including 9,300 who had recently left 
        the military, and 1,500 family members of Florida veterans 
        received workforce services.
   Workforce Florida's popular training grant programs 
        available to Florida businesses, Quick Response Training (QRT) 
        and Incumbent Worker Training (IWT), awarded $17.2 million in 
        grants to train nearly 30,000 workers. Businesses responded 
        with cash and in-kind matches projected at $263 million in 
        investments for improving their workers' skills.
   Ten new Employ Florida Banner Centers were launched, mostly 
        at community colleges and universities, to increase the 
        availability and quality of cutting-edge training for new and 
        experienced workers in high-skills, high-wage sectors such as 
        biotechnology, energy, health sciences and aviation and 
        aerospace that help diversify the state economy--a top economic 
        development priority in Florida.
   At the end of June 2007, Florida's unemployment rate of 3.5 
        percent was one percentage point lower than the national rate 
        of 4.5 percent, continuing the below-the-national-average trend 
        that started in mid-2002. Florida also had recorded 58 
        consecutive months of job growth, gaining about 113,700 more 
        jobs than a year ago. Industries gaining the most new jobs were 
        education and health services, leisure and hospitality and 
        professional and business services. Job losses were in 
        construction, manufacturing and information.

    Workforce Florida's continued success at responding to the training 
and employment needs of businesses and citizens is rooted in its 
continuing efforts to foster collaboration not just throughout the 
workforce system, but among partners in education, economic 
development, industry and elsewhere. The responsiveness and flexibility 
of this organization allows us to act and react quickly to workforce 
needs, such as those expressed by the energy industry sector.
    Question 4. In your testimony, you state that to build our energy 
workforce, we ``need to convince young workers that the industry is a 
desirable one to work for, [that] they must understand the industry 
produces a commodity that is essential to society and to our quality of 
living [and that they] must also be taught that those who work in the 
industry are environmentally responsible and that the jobs are 
stimulating and pay well.'' Are these factors identified because they 
are current inhibitors to a stronger energy workforce?
    Answer. The image of the energy industry is in need of improvement, 
as stated by many company representatives in the Florida Energy 
Workforce Consortium. For the first time, the energy industry has had 
to promote itself in the job marketplace, due to a number of factors 
including tight labor markets, an increasing number of retirees with 
fewer workers to take their place, and a diminished focus on career and 
technical education. The current image of jobs in the energy industry 
is less than desirable--hot, dirty, repetitive and risky. This is 
further exacerbated because many teachers and guidance counselors, who 
are the existing source of career information, have limited, if any, 
knowledge about the energy industry, the kind of jobs within it, the 
career paths and earning potential, or how one enters a job and 
advances in this sector. Students and guidance counselors are unaware 
of the cutting edge technology and safety practices that are utilized 
by utility employees to fulfill the critical role they play in 
providing energy to their communities. For this reason, building career 
awareness of the well-paying jobs in the sector is cited as one of the 
top priorities of both the Florida Energy Workforce Consortium and the 
Center for Energy Workforce Development. Additionally, the Consortium 
and the Center are affirming the importance of career and technical 
education in secondary education, particularly those educational 
programs that convey industry-recognized credentials to program 
graduates.
                                 ______
                                 
  Responses of Emily Stover DeRocco to Questions From Senator Bingaman
    Question 1. As you know the U.S. energy industry is large and 
diverse. Does the Department of Labor have a good data base on the 
extent of the workforce problem facing our Nation from which to develop 
training programs at both the skilled labor and professional levels?
    Answer. I am pleased to report that the Department's Employment and 
Training Administration (ETA) is fully engaged with multiple sectors 
within the energy industry in order to ensure that the workforce 
investment system has aligned its strategies with the needs of the 
industry. Our information on workforce issues facing the energy 
industry is not maintained in a single database, but relies on a 
variety of sources. One source is a 2007 report that discusses 
workforce shortages in three major energy sectors--utilities, mining, 
and oil and gas. It is in this industry report where we note that the 
average age of workers in the energy industry is now over 50, and that 
the industry estimates that up to half of its current workforce--more 
than 500,000 workers--will retire within 5 to 10 years. This report 
also notes that the utilities sector expects it will need to replace 
approximately 25,000 workers by 2015, that the mining sector expects to 
replace half of its workforce over the next seven years, and that the 
total number of workers in the oil and gas sectors will decline 28 
percent by 2012.
    ETA considered it a critical step to find mechanisms to better 
understand the future direction of the energy industry. To that end, as 
part of the President's High Growth Job Training Initiative (HGJTI), we 
have done extensive research with industry leaders about the workforce 
challenges facing the sectors of the energy industry. In 2004, after 
conducting a scan of the energy industry to gain a better understanding 
of the opportunities and challenges it faces, ETA met with chief 
executive officers (CEOs) from across the energy industry to learn 
about the growth potential of their industry and to understand 
workforce challenges critical to continued growth. We then conducted a 
series of workforce solutions forums with industry human resources 
executives and representatives from the education and the public 
workforce investment system. These solutions forums were designed to 
compile industry-driven strategies that would address the workforce 
challenges of the industry. The results of these sessions, along with 
the statistics referenced earlier, are summarized in an Industry Report 
which is available online at http://www.doleta.gov/BRG/pdf/
Energy%20Report--final.pdf.
    As a result of our continued engagement with industry partners, in 
August of 2007, ETA convened an Energy Skilled Trades Summit where we 
met with leaders from the energy industry, education and the workforce 
system and heard first-hand about their workforce challenges. Among the 
over 300 attendees were four governors and 20 CEOs of major energy and 
construction firms. We hosted this event in partnership with industry 
associations, such as the Nuclear Energy Institute, the American 
Petroleum Institute, Edison Electric Institute and the Center for 
Energy Workforce Development, to call attention to the workforce needs 
of the industry in the Southeast States and to help facilitate a 
collaborative public-private approach to addressing these needs. 
Research conducted by these organizations provided background for 
discussion about the industry's critical workforce shortages at the 
Summit.
    ETA also maintains a database of its own strategic investments in 
the energy industry that have been made through the HGJTI, the 
Community-Based Job Training Grants (CBJTG) and the Workforce 
Innovation in Regional Economic Development (WIRED) Initiative. To 
date, ETA has invested over $150 million in 37 projects across these 
three major initiatives. The HGJTI and CBJTG have trained over 86,000 
participants, many of them in the energy sector.
    Finally, we are working closely with the Department of Energy (DOE) 
to obtain labor market information on workforce issues facing the 
energy industry. ETA, in conjunction with our colleagues at DOE and the 
Department of the Interior, are commissioning the National Academy of 
Sciences to conduct a study on the availability of skilled workers in 
the energy, mining, nuclear, and alternative energy industries. By 
bringing together the workforce data collected by ETA and the Bureau of 
Labor Statistics, connecting with business leaders in the energy 
industry, and working with our federal colleagues at DOE, we are 
developing a comprehensive, data-driven, demand-driven picture of the 
workforce challenges facing the industry. It is this synergy that 
allows us to make informed policy decisions with federal and non-
federal resources when developing training programs at both the skilled 
labor and professional levels.
    Question 2. How early in their educational career are potential 
workers being targeted by the Workforce Investment System? Is it 
possible to push this into working with workers when they are even 
younger?
    Answer. Currently, through both formula and discretionary grant 
programs, the workforce investment system engages youth as young as age 
14 who face barriers to school completion and employment, to prepare 
them for the 21st century workforce. Over the past two years, ETA has 
worked steadily on implementing its Shared Youth Vision Initiative 
which asks employers to define the skill needs for the emerging youth 
workforce and to pair those skill needs with workforce investment 
system resources. Multiple education pathways are used to reconnect the 
neediest youth with education and career options, especially dropouts. 
These pathways are developed by mapping a variety of alternative 
learning strategies and environments that provide academic instruction 
that is rigorous and challenging, as well as relevant to emerging 
occupations and careers through applied learning strategies. 
Alternative learning environments such as career academies allow 
students to apply their academic course work to the world of work 
through internships and business involvement in curriculum design and 
instruction, with the goal of increased student achievement, 
preparedness for post-secondary education, and a greater ability to 
transition into in-demand careers.
    Many industries, including energy, have identified significant 
challenges related to the capacity of high school graduates to enter 
higher education for careers that require strong foundational Science, 
Technology, Engineering, and Math (STEM) skills. ETA is currently 
working collaboratively with our colleagues at the Department of 
Education and the National Academy of Sciences to focus on new 
education models at all levels, with a strong emphasis on applied 
learning in order to also expose students to careers in industries like 
energy. In addition, STEM education is a key focus in ETA's 39 funded 
WIRED regions, which are incubating many new models that will be shared 
nationwide.
    Another area of focus for ETA has been to develop partnerships and 
tools that support strong career awareness and guidance. In partnership 
with industry and the Department of Education, ETA hosts the Career 
Voyages Web site (www.careervoyages.gov). Targeted to young people and 
career changers, this Web site highlights career information in a wide 
array of high growth, high demand industry sectors, including the 
energy sector. The Web site, containing a wealth of user-friendly labor 
market and economic development information, is designed to be used by 
students, as well as their parents, teachers and guidance counselors. 
By having a presence on the Internet, we are hoping to reach a younger 
generation of future workers and make them aware early on in their 
career decision-making process as to the opportunities that exist in 
the energy industry.
    As a complement to Career Voyages, ETA has published print copies 
of InDemand magazines, which focus on high growth industry careers. ETA 
has sent over a million copies of these magazines to high schools 
across America. This information can be read or downloaded from the 
Career Voyages Web site, and ETA is particularly proud of the magazine 
developed for the energy sector, which can be found at http://
www.careervoyages.gov/indemandmagazine-energy.cfm.
    In an effort to help parents support their children's education and 
career decisions, ETA has also partnered with the National Parent 
Teacher Association to provide school personnel, students, and families 
with information that will better enable high school aged youth to 
utilize available resources to assist with career planning and to help 
them make the right academic decisions that will support successful 
transitions from school to work. We are currently working on tools for 
specific industry sectors, such as energy, as the next step in that 
partnership.
    Question 3. How is the Department of Labor ensuring that workers 
are being prepared for energy related careers that will be permanent 
and lasting? Is DOL targeting career training that will translate into 
other positions as the energy model expands and adapts to innovation 
and new technology?
    Answer. All of ETA's efforts are designed to help both students and 
adults gain access to postsecondary education and education pathways 
that will provide access to careers. During this administration, ETA 
has been working to guide the workforce investment system to become 
more demand driven, ensuring that individuals served by the system 
understand the jobs available within the industry sectors that drive 
their economies. ETA has used the HGJTI as a key vehicle to drive this 
approach in the energy sector and other high growth industries.
    As a result of the HGJTI, today governors and State Workforce 
Investment Boards are routinely identifying targeted industry sectors 
as part of their strategic plans under WIA, and this leads to training 
resources being targeted to help skill individuals for employment in 
the energy industry.
    As your question implies, in the current economy, there is a need 
to ensure that we have a workforce with highly transferable skills. To 
support the workforce investment system and its education partners in 
understanding how competencies may cut across industry sectors, ETA is 
currently working with the Center for Energy Workforce Development 
(CEWD) through the HGJTI. CEWD and its partners have created a Web 
site, Get Into Energy (http://www.getintoenergy.com), that provides 
information on the industry, career opportunities, competency and skill 
requirements, and information on where to access training. Through the 
site, educators (and parents) have access to lesson plans and tools for 
communicating opportunities in the energy industry to students. The key 
components of the Get Into Energy site are a career assessment tool, a 
competencies and skills tool, a salary comparison tool, a training and 
job locator using Google Earth technology, and a utilities lineman 
career profile video that serves as a model for videos on additional 
occupations.
    Question 4. How successful have these programs been--do you have 
tracking metrics? Your testimony points to the amount of investment but 
what is the success rate of the Workforce Investment System? How 
successful has DOL been in meeting the training needs of employers and 
employees?
    Answer. The performance measures for the workforce investment 
system are entered employment, retention, and earnings. These measures 
allow ETA to evaluate its progress in meeting the core purposes of our 
programs, namely, how many of our program participants got a job, how 
many stayed employed, and what were their earnings. To date, the 
workforce investment system has demonstrated the ability to be 
responsive to the needs of both high growth industries and program 
participants. For the WIA Adult program, nearly 80 percent of those who 
received training obtained immediate employment and of these 
individuals, more than 86 percent maintained their employment. The WIA 
Dislocated Worker program also performs at a very high level, with 86 
percent of those who received training entered employment and 91 
percent retained employment. Both programs have consistently sought to 
increase the earnings of their trainees by placing them in high growth, 
high wage occupations with career ladders. Overall, we believe these 
measures and results accurately describe our effectiveness in focusing 
our education and training investments to meet the needs of high growth 
industries, such as energy, and to facilitate local, regional, and 
state talent development for occupations in demand.
    In addition to our WIA investments, ETA has three major job 
training programs currently underway--the President's High Growth Job 
Training Initiative (HGJTI), the Community-Based Job Training Grants 
(CBJTG), and our newest initiative, Workforce Innovation in Regional 
Economic Development (WIRED). Each provides training tailored to the 
skill and occupational needs of the energy industry in regional 
economies. To date, the HGJTI grants have trained 73,430 participants 
and the CBJTG have trained 13,466 participants, many of them in the 
energy sector. For example, the College of Eastern Utah was awarded a 
$2.7 million High Growth grant to consolidate training curricula that 
are applicable to multiple sectors of the energy industry and will 
ultimately aid employees looking to enhance their skills for promotion 
or career changes. This project creates a conduit among local, state 
and federal workforce agencies and the energy industry to more 
effectively leverage workforce system resources and meet industry 
needs. To date, the project has trained 3,600 workers and built the 
capacity to train up to 2,100 people annually. Another example is the 
$2.4 million High Growth grant to the Wyoming Department of Workforce 
Services to establish the Rocky Mountain Oil and Gas Training Program. 
This program is designed to provide safety training for heavy equipment 
operators, truck drivers, crane operators, and safety coordinators 
through a simulated work environment on a 76 acre simulated oil and gas 
field. As of Spring 2007, the program had trained and certified 425 
workers, with 411 getting jobs.
    Further, ETA has focused on creating a demand driven public 
workforce investment system that is dedicated to serving the needs of 
business. The workforce system understands that serving employers and 
workers is critical and many states have highlighted energy, both 
traditional and alternative, as a key industry in their WIA plans. This 
industry focus is driving the allocation of resources at all levels of 
the workforce system to the benefit of employers, workers, and the 
Nation's economic competitiveness.
  Responses of Emily Stover DeRocco to Questions From Senator Domenici
    Question 5. You note in your testimony that employers of all 
sectors of industry will need workers who are more proficient in math, 
science and technology. Senator Bingaman and I worked very hard on the 
America COMPETES Act, which was enacted earlier this year. This new law 
will go a long way to strengthening the brainpower of our young people 
who will be the next generation of scientists and engineers. How can we 
build on the provisions of the America COMPETES Act to make sure it is 
serving the needs of the energy sector?
    Answer. As mentioned in my testimony, one of the workforce 
challenges in the energy industry is the misconception that energy jobs 
are low-skilled, require little education or training, and provide 
inadequate compensation. From alternative energy and nuclear energy to 
utilities and natural resource refinement, the U.S. will need workers 
at all levels in the energy industry in the foreseeable future. From 
the skilled trades (such as welders, electricians, and pipe fitters) 
who will build and maintain our Nation's power plants, to the 
scientists, engineers, and operators who will run them, the energy 
sector needs a talented, well-educated, well-trained workforce.
    The America COMPETES Act will help erase the traditional stigma 
against energy careers by promoting education in Science, Technology, 
Engineering and Mathematics (STEM) and raising awareness about career 
options where we need it most--in our schools. We need to be reaching 
our Nation's young people long before they transition out of high 
school.
    Further, by promoting STEM awareness and mentorship in STEM careers 
to elementary and middle school students the America COMPETES Act helps 
to alleviate the stereotype about energy careers. Grades one through 
eight are critical in a child's life when career choices and 
perceptions of the workplace are beginning to be formed. Once 
interested in STEM, students can begin to explore career options, 
including those in the energy industry. Summer internship programs for 
middle school and secondary school students in STEM, the establishment 
of statewide specialty schools that provide comprehensive STEM 
education, and the creation of regional Centers of Excellence in STEM 
in secondary schools will each provide opportunities to promote careers 
in the energy industry. Future generations of young Americans will 
associate the energy industry with lucrative, fulfilling careers as 
scientists, engineers, mechanics, as well as the skilled trades, and 
provide the power we need to not only keep the lights on, but to keep 
our competitive edge in the global economy.
    While ETA is working to support activities to inform students about 
career pathways and opportunities specific to STEM careers, we have 
more of an impact through the public workforce investment system on 
individuals who are typically disconnected from the traditional 
education system. The workforce system assists workers who may not be 
equipped with STEMS skills, but who can utilize the resources of the 
system to gain these skills. By providing meaningful career guidance 
and access to training resources, such as apprenticeships and technical 
education, the workforce system plays an important role in 
transitioning workers into high-skill and high-wage job opportunities 
in the energy industry and others reliant on STEM skills.
    In addition to reaching out to our Nation's youth and adult 
workers, we must improve America's competitiveness in the areas of 
technological innovation and STEM by leveraging and aligning Federal 
funds in education, research and development, facility construction, 
and public-private partnerships. Any additional Federal investment in 
these areas will contribute to a collaborative effort that must bring 
together many resources--government, private industry, and education, 
financial and human capital, and brick-and-mortar assets such as 
laboratories.
    This type of integrated approach to solving our Nation's workforce 
challenges is what the Department has been undertaking since 2006 
through our WIRED initiative. As mentioned in my testimony, 13 of the 
39 WIRED regions are focusing on workforce challenges in the energy 
industry. Within these 13 regions, the breadth of activities spans the 
energy industry spectrum, from biofuels research in the Arkansas Delta, 
STEM education and skill development in Colorado and Michigan, 
alternative energy in Indiana, to renewable energy in Minnesota and New 
Mexico. The Department's WIRED investments complement the mission and 
objectives of the America COMPETES Act, while at the same time 
addressing the workforce needs within the energy industry.
    Question 6. I was interested to learn that the Department of Labor 
has 13 regional initiatives focused on the energy industry, including 
one in Central New Mexico. I was also interested that other regional 
partnerships are working with Oak Ridge National Lab in Tennessee, and 
with the National Renewable Energy Laboratory in Colorado. Do Sandia 
and Los Alamos participate in the regional partnership efforts in New 
Mexico? If not, do you see a way that the New Mexico labs could add 
value to the regional effort?
    Answer. I am pleased to report that both Sandia National 
Laboratories and Los Alamos National Laboratory are full partners in 
our WIRED investment. Both facilities have committed to making their 
resources available to support technology maturation projects being 
developed onsite. Additionally, Sandia National Laboratories will be 
making internships available for students in support of its ongoing 
programs and as part of the National Institute for Nano-Engineering, 
which is a new educational outreach program being established at Sandia 
Labs. More information on this investment is available in my written 
testimony.
    Question 7. You note in your written testimony that few portable 
credentials have been developed in the energy industry. (A) Is there a 
role for the Department of Labor in helping industry develop 
standardized credentials for its workforce?
    Answer. Yes, there is a role for the Department of Labor in helping 
the energy industry develop standardized credentials for its workforce.
    The development of credentials is usually a multi-phase process: 1) 
assemble an industry agreed-upon body of knowledge, competency model, 
and/or skill standards; 2) develop a curriculum to teach the required 
competencies (knowledge, skills, and abilities); 3) develop an 
assessment of the competencies; and 4) establish an industry-recognized 
certification based upon successful completion of the assessment and 
other requirements.
    Developing and administering actual assessments and certifications 
require specific subject matter expertise and intensive industry 
involvement. Within our resources, and given the wide scope of 
different industries that we work with, ETA has made the strategic 
decision to focus on the development of industry competency models and 
related curriculum as the foundational pieces in assisting industry in 
developing credentials.
    The President's High Growth Job Training Initiative identified 
industry 14 sectors, one of which is energy. These sectors are 
projected to add substantial numbers of new jobs to the economy, affect 
the growth of other industries, or are existing or emerging industry 
sectors being transformed by technology and innovation requiring new 
skills sets for workers. Through the initiative, ETA has worked with 
business leaders to create comprehensive and readily accessible 
documentation of the skills and competencies required in a variety of 
high growth, high demand industries.
    These industry competency model frameworks assist businesses, 
educators, and workforce professionals in developing education and 
training programs that effectively address core competencies, such as 
having basic familiarity with computer applications and selecting the 
right tools to solve problems. The goal is to advance understanding of 
the skill sets and competencies that are essential to educate and train 
a globally competitive workforce.
    In partnership with the Center for Energy Workforce Development and 
representatives of member companies of the Edison Electric Institute, 
work is underway to develop an energy competency model. ETA has also 
funded projects to develop curriculum in the energy sector through the 
HGJTI and the CBJTG. These initial steps by ETA, the development of an 
energy competency model and an energy curriculum, are leading to 
standardized, portable credentials across the energy industry.
    Question 7B. Should the Departments of Labor and Energy work in 
partnership to address this issue?
    Answer. ETA is committed to working in close partnership with the 
DOE to develop standardized credentials in the energy industry. 
Although DOE's involvement is key to addressing this issue, they are 
not and should not be our sole partner in this effort. A critical step 
in the credentialing process is the collaboration and engagement of 
energy stakeholders all levels, public and private, Federal, state, and 
local, to collect an industry agreed-upon body of knowledge that leads 
to the discussion of cross-cutting skill standards. An example of this 
partnership is that ETA and DOE, along with the Southern Governors 
Association, were able to jointly participate in an Energy Skilled 
Trades Summit in August where we were able to articulate our vision for 
how Federal agencies and the energy industry would work collaboratively 
to build a skilled energy workforce, with a particular focus on skilled 
trades.
    Perhaps most importantly, ETA and DOE have worked closely through 
our WIRED regions to align and leverage Federal resources to support 
regional economic development which is central to workforce 
development. Focusing our efforts on regional economies, our effort is 
to create portable, transferable credentials across the energy industry 
and across the country. WIRED allows our Nation's workforce to be both 
flexible and adaptive to change by creating ``career lattices.'' A 
veteran electrical lineman in Dallas who wants to update his skills 
should be allowed to take his knowledge and experience to be trained to 
lay fiber optic cable in Fort Worth. The following is a full list of 
partnership opportunities currently in progress under the WIRED 
Initiative:

   Thirteen WIRED regions attended an Alternative Energy 
        Institute at the National Renewable Energy Laboratory (NREL). 
        ETA has been working with the Technology Transfer Office at 
        NREL to continue to provide WIRED regions with information on 
        NREL's biomass research program and technology transfer and 
        commercialization programs and to discuss mutually beneficial 
        follow up activities.
   In addition to NREL, ETA is partnering with other DOE 
        National Laboratories across the country to increase WIRED 
        region access to Federally-funded technologies at federal 
        laboratories (e.g., automation, prototyping, materials science, 
        information technologies, energy and environmental 
        innovations). The partnership will lead toward the 
        establishment of portable, standardized industry credentials 
        and increase the regions' industrial competitiveness. This will 
        stimulate wealth creation and employment opportunities as well 
        as foster public-private collaboration in technology 
        development, innovation and commercialization.
   ETA has negotiated a partnership opportunity with the DOE's 
        Office of Science to give preferential placement for WIRED 
        regions in its Summer Training for Science and Math Teachers. 
        Currently, it offers a three consecutive summers of training 
        and mentoring experience for cohorts of teachers at its federal 
        labs across the country.
   he North Central Indiana WIRED region has developed an 
        energy efficiency certification with the input of our Federal 
        partners: U.S. Department of Commerce's National Institute of 
        Standards and Technology, the Manufacturing Extension 
        Partnership program and the DOE-supported Industrial Assessment 
        Center at Purdue University.

    ETA will continue this exciting work into 2008 to actively seek out 
opportunities for collaboration in our WIRED regions and in all areas 
where the potential for cross-fertilization exists. In addition, ETA 
will continue to work with our energy stakeholders to address the 
establishment of portable, standardized credentials and all workforce 
challenges currently being faced by the energy industry.
                                 ______
                                 
    Responses of James L. Hunter to Questions From Senator Bingaman
    Question 1a. Your testimony on page 1 indicates that the average 
age of a line man is 51 years old and they are working enormous amounts 
of overtime. What is the average amount of overtime they work in a 
year?
    Answer. We have many utilities that are averaging 800 hours a year 
in overtime. That means some people are working over 1200 hours.
    Question 1b. Do you think the quality of service provided by some 
utilities is affecting by the line man shortage, age and large amounts 
of overtime--if so how?
    Answer. The quality of service has been impacted by the reductions 
in the workforce. We have 40% less workers than in 1990 and the system 
has increased in size by 30% during that period. When major storms hit 
the utilities do not have enough trained workers to assist the out of 
state help that is sent in by reciprocity agreements. One scenario that 
congress should remember is the major storm in 2003 that hit the DC 
area. Customers were out of service for over 8 days, inside the DC 
beltway. Customer hookup times and service complaints have steadily 
increased over the last few years across the U.S.
    Question 2. Do you believe workers in skilled manufacturing jobs 
that are in danger of being outsourced or whose plants are being closed 
due to competition are good candidates for training in the utility 
industry? If so, how can IBEW, the Congress and the executive branch 
work to tap into this resource?
    Answer. The IBEW believes that the manufacturing sector is an 
excellent source for potential candidates for the utility industry. The 
IBEW and Congress should work together to attract and pay for 
retraining initiatives in the utility industry. The IBEW is starting a 
major training initiative in the utility sector and would welcome 
Congressional involvement. The IBEW is also working with the Center for 
Workforce Development (CEWD) to attract people to our industry.
    Question 3. Has the IBEW began an assessment of the skilled 
workforce needed for the increasing demand for solar and wind 
generation or is it mainly viewed through the connection to the grid?
    Answer. The IBEW has not done an assessment of the employment needs 
of the wind and solar industries. The uncertainty of the tax credits 
and placement issues have made long term planning difficult.
                                 ______
                                 
       Responses of Ray Stults to Questions From Senator Bingaman
    Question 1. In your testimony you note the increased demand that 
will be placed on the workforce for the production of biofuels, for 
companies such as Colonial--how far out will this impact their pipeline 
projections? Will new pipelines have to be built to accommodate 
biofuels or is it possible to use existing pipelines?
    Answer. In some regions, and among some job categories, we are 
hearing that employers already are finding it difficult to hire 
employees with the skills and experience they need. Colonial, of 
course, would be in the best position to address the specific impacts 
on their projects.
    The issue of using existing pipelines is sparking keen interest 
among biofuels companies. While some opportunities may exist to shift 
existing pipelines to ethanol, there are concerns that differences in 
the chemical properties of existing fuels, and ethanol, will largely 
preclude a wholesale redeployment of existing pipeline infrastructure 
to serve the expanding ethanol production industry, and in most cases 
it is anticipated that entirely new pipeline systems will be required.
    Question 2. You mention that your own laboratory has difficulties 
obtaining trained professional personnel in biofuels--your facility is 
one that is primarily R&D, do you think industry will have similar 
problems in chemical engineers as it scales up to large scale 
production?
    Answer. It is our understanding that industry already is 
encountering such issues. The shortage of qualified professionals 
threatens to force delays and drive up costs of important biofuel 
projects.
    Question 3. In your testimony you mention that the U.S. would have 
to lower the labor hours per blade of a wind turbines by 1/3 to remain 
competitive with foreign manufacturers--what specific manufacturing 
technologies do foreign firms have an edge over the U.S. in? Does that 
mean that most wind turbines are manufactured overseas?
    Answer. Because turbine blade manufacture is highly labor 
intensive, some firms have gone offshore in search of lower labor costs 
for blade manufacturing facilities; turbine manufacturers import blades 
for the US market from Brazil, Mexico, and various EU countries. 
Eliminating shipping import costs provides some advantage for domestic 
production. However, in order to fully compete on a cost-competitive 
basis, U.S. firms may have to develop more advanced technologies and 
systems for U.S. production as well.
    As turbines and blades grow larger (2.5MW+), there may be increased 
efforts to develop advanced manufacturing technologies, fabrication and 
assembly techniques that are co-located at or near wind farm 
development sites. This could potentially reduce transportation costs 
and improve the economies of future wind turbine blade construction.
       Responses of Ray Stults to Questions From Senator Domenici
    Question 1. You recommend several studies assessing our energy 
workforce as an initial policy directive. Do you have recommendations 
for Federal policy beyond such studies?
    Answer. The studies we recommend would provide valuable insights 
into the future demand for those job specialties that will be needed to 
support the expanding renewable energy industries. Once those findings 
are in, we hope to be in a better position to assess the overall 
picture, and identify potential gaps between the existing workforce and 
the skills required by industry. Armed with that information, we may be 
able to prescribe additional initiatives that would be beneficial.
    Question 2. Would you say current assessments on our future demand 
for an energy industry workforce properly account for the projected 
growth of the renewable energy industry?
    Answer. Much depends on the policies enacted to support renewable 
energy technologies, as well as external forces such as the price of 
oil. This is why research needs to continually track evolving market 
trends and government initiatives. As the Nation's energy outlook comes 
into clearer focus, new policies should be informed by the most current 
and comprehensive investigation available.
                                 ______
                                 
  Responses of Patricia A. Hoffman to Questions From Senator Bingaman
    Question 1. Does the Department know whether the shortage of 
transmission linemen has affected the ability to bring a grid up after 
hurricanes or power outages?
    Answer. During an extreme event such as Katrina, linemen came from 
across the country to aid in restoration. The physical state of the 
area (e.g. flooding) in addition to the travel time did delay 
restoration efforts. However, it is difficult to accurately evaluate 
the impact of workforce on grid restoration time. No two events are 
identical and the response to specific events (such as Katrina versus 
Rita) is affected by many factors, such as the availability of poles 
and transformers or the extent of storm damage. While the electric 
industry in general maintains a high level of reliability of the 
electric system, the Department recognizes that one factor that could 
delay restoration efforts in response to multiple catastrophic events 
is the availability of skilled linemen.
    Question 2. Your August 2006 report on the electric utility 
industry, which mandated by section 1101 of the 2005 Energy Policy Act 
states in the executive summary that even with the expanded training 
programs ``analysis indicates a significant forecasted shortage in the 
availability of qualified candidates by as many as 10,000 line workers, 
or 20% of the current workforce''. What impacts does the Department 
project of this impact if it is realized?
    Answer. If the electric utility industry does experience a shortage 
of qualified line workers, the most obvious impact will be one of 
supply and demand--as the supply of workers goes down, wages will go 
up. There may be a growing divergence in quality and quantity of 
lineworkers between utilities and regions. Utilities that can afford to 
hire the top talent will likely do so, while other utilities may pursue 
other options such as outsourcing. However, this could result in longer 
restoration times since lineworkers may not be in close proximity to an 
event.
    Question 3. Section 1101 further instructs the Department to report 
to Congress as soon ``as practicable after the Secretary identifies or 
predicts a significant shortage of skilled personal in 1 or more energy 
technology industries''. Has the Department identified any other 
significant shortages besides lineman?
    Answer. The report prepared by the Office of Electricity Delivery 
and Energy Reliability focused on the workforce in the utility segment. 
The Department of Energy is preparing to enter into an agreement by the 
end of November with the Department of Labor to engage the National 
Academies to perform more extensive analysis in other energy technology 
sectors.
    Question 4. Section 1830 of the 2005 Energy Policy Act asks for the 
Department to enter into an arrangement with the National Academies to 
study the short-term and long-term availability of skilled workers to 
meet energy and minerals needs of the U.S. Where is the Department in 
meeting section 1830?
    Answer. The Department of Energy is working closely with the 
Department of Labor to fulfill the requirements of EPACT section 1830 
through a memorandum of understanding we expect to finalize by the end 
of November. Thereafter, the Department of Labor plans to enter into an 
arrangement on behalf of the Department of Energy with the National 
Academy of Sciences (NAS) to conduct the study required by EPACT. We 
understand that the NAS believes the study will take approximately 18 
months to complete.
                                 ______
                                 
   Responses of Carol L. Berrigan to Questions From Senator Bingaman
    Question 1. The NEI has stated at a February 2007 American Nuclear 
Society meeting that ``the average age of employees in the industry is 
48 years--one of the oldest of any major industries in the country. 
Retirement attrition will create the need to essentially re-staff the 
existing fleet over the next 10 years. We need to get the younger 
generation into the industry''--and this does not include the expected 
new plant builds from the 15-30 combined operating licenses to be 
submitted to the NRC. Have you seen any shift in your employment 
surveys to indicate a re-staffing is occurring?
    Answer. NEI conducted staffing surveys in 2003, 2005 and 2007. The 
data referenced during the February 2007 CONTE meeting was drawn from 
NEI's 2005 staffing survey. The most recent survey (for which results 
were not available at the time of the CONTE conference) indicated 
increased hiring activity across the industry, most notably in the 
engineering, operations and vendor segments. The 2007 survey indicates 
that young engineers (18-27 years of age) made up 7.5 percent of the 
utility engineering workforce compared to only 5 percent in 2003 and 
5.6 percent in 2005. Young operations personnel (18-27 years of age) 
made up 5.2 percent of the utility operations workforce in 2007 
compared to only 3.7 percent in 2003 and 3.9 percent in 2005 and within 
the vendor workforce, young professionals make up 7.9 percent of the 
workforce compared to 5 percent in 2005.
    The increase in younger workers entering the nuclear industry can 
also be seen in the growing membership of North American Young 
Generation in Nuclear (NA-YGN), an organization of young professionals 
(35 and under) who work in nuclear related fields. At the NA-YGN/ 
American Nuclear Society Young Professional Congress held in November, 
the NA-YGN announced that their membership has grown to roughly 3,100 
members. This is an increase from approximately 500 in 2003.
    Question 2. Your testimony, on page two of your testimony, you note 
that new builds will require 1,400 to 1,800 workers for construction 
with a peak of 2,300 and with a outbound of 31 combined operating 
licenses this is about 43 to 56,000 skilled workers. Do you know where 
the greatest need in the type of skilled craft the industry will need 
and will it compete with other utilities?
    New nuclear construction will require numerous skill types 
including: welders, pipefitters, masons, carpenters, millwrights, sheet 
metal workers, electricians, ironworkers, heavy equipment operators, 
and insulators, as well as engineers, project managers, construction 
supervisors and other specialized workers. Many of the skills needed in 
the nuclear industry will be similar to those used in other energy 
construction and labor availability will be affected by other competing 
work within local and regional labor markets.
    Based on the companies and consortia that have announced plans to 
submit combined operating license applications, we expect much of the 
new nuclear construction will be centered in the Southeastern U.S. 
(Maryland through Texas) with some additional nuclear construction in 
other regions. A recent survey by the Southeast Manpower Tripartite 
Alliance indicated that in the Southeast, the high demand crafts will 
be pipefitters (includes welders) and electricians and that high growth 
crafts will include boilermakers (includes welders).
    In addition, we have identified growing needs in the following 
areas: construction management, engineering project management, non-
destructive examination, instrumentation and control, quality 
assurance/control and construction supervision.
    Question 3. Nuclear quality control or NQA-1 as the NRC refers is 
just as much about trained personnel such as welders as components. 
Does the industry have adequate training programs in place to certify 
some of the crafts to build new plants to NRC workforce standards?
    Answer. As the nuclear industry prepares for new construction, it 
is actively engaged in developing training and certification programs 
to support future needs. It is important to note that workers who are 
trained in industrial skilled crafts support many industries. It is 
somewhat impractical to establish project based training programs since 
many of the skills needed require an extended period of training or 
apprenticeship to become proficient and will work for numerous 
employers in several industry sectors. Overall, the industry is 
increasing engagement in regional or state training initiatives which 
include broader energy/ industrial sector involvement.
    In order to adequately answer this question, it is necessary to 
separate training from qualification. The industry is required to meet 
applicable NRC qualification standards. In the case of welders, the 
applicable qualification standard relies on the demonstration of 
knowledge and skills through a certification process and exam. I 
believe the industry will have ample capacity to certify the needed 
workers for new construction in compliance with NRC requirements.
    Question 4. There has always been a strong link between trained 
personnel in the nuclear navy and civilian reactor fleet, how has the 
draw down in size of the nuclear submarine fleet affects if any the 
staffing of the civilian fleet?
    Answer. During the draw down of the nuclear submarine fleet, the 
nuclear industry was able to recruit significant numbers of workers 
with prior nuclear navy experience for employment in the civilian 
nuclear sector. While the industry is still able to recruit some 
personnel with prior nuclear navy experience, the industry is relying 
more and more on development of local talent pools through community 
college, apprenticeship and skills center training programs. In 
addition, the industry is also recruiting mid-career personnel from 
other industries. The industry also continues to participate in and 
support programs that assist returning military personnel transition 
into the civilian workforce such as the Helmets to Hardhats and the 
Hire a Hero programs.
   Responses of Carol L. Berrigan to Questions From Senator Domenici
    Question 5. We have heard a lot today about the overall scale of 
the looming workforce shortage facing the energy industry. Could you 
give us some specific recommendations for actions the federal 
government could take that would be most effective in addressing these 
problems?
    Answer. In my testimony, I outlined six areas where action is 
needed. I believe the federal government can take effective action in 
many of these areas.
    Raising awareness--This committee has continued to demonstrate 
strong leadership on energy workforce issues and holding this hearing 
on November 6th continued this legacy. During the hearing, Senator 
Murkowski suggested conducting a similar hearing for the HELP committee 
to better educate her peers on that committee about these issues. 
Holding such a hearing would continue to raise awareness of this 
important issue. In addition, I would encourage members of the 
committee to seek other venues through which awareness of this issue 
and the opportunities afforded to workers in the energy sector can be 
raised among decision makers at the federal state and local level and 
with the public.
    Aligning investments, elevating image, training workers, building 
partnerships--Since much of the funding used to invest in workforce 
development comes from the Federal government, a coordinated Federal 
approach that includes the Departments of Labor, Energy, Education and 
Interior in close consultation with the energy industry and organized 
labor is warranted. This approach should include measures to increase 
career awareness at the secondary education level, support pre-
apprenticeship career technical education for all energy related 
skilled crafts, support community college and skill center training for 
specialized technicians, and provide regional grants for integrated 
workforce development programs.
    In addition, the Federal government should consider employer tax 
credits for apprentice utilization, incumbent worker training and 
displaced worker training for employment in the energy sector.
    Question 6. Assistant Secretary DeRocco pointed out that some 
segments of the energy industry lack ``portable certification'' 
credentials for their workers. Is this an industry issue? Is there a 
role for the Nuclear Regulatory Commission for helping to develop 
certification programs, beyond what is currently being done?
    Answer. The portable certification issue raised by Assistant 
Secretary DeRocco, is generally not an issue for the nuclear industry. 
Many workers in the nuclear industry require qualification with 
specific industry-wide or consensus standards such as those promulgated 
by ASME, ANSI, ASNT or the National Academy of Nuclear Training. 
Others, such as reactor operators, are required to be licensed by the 
NRC on the specific reactor design that they will operate.
    I do not believe that that there is a role for Nuclear Regulatory 
Commission in this area as their purview is nuclear licensees and the 
issue the Assistant Secretary described is multi-sector. Any additional 
certifications the NRC develops may further complicate portability of 
certification since it would be nuclear specific and the energy skilled 
trades workforce is transient between nuclear and non-nuclear energy 
infrastructure.
    Question 7. In your testimony, you highlight the relationship 
between the manufacturing workforce and energy industries. Would you 
recommend addressing manufacturing workforce issues, such as 
outsourcing, simultaneously or separately from energy workforce issues?
    Answer. I would recommend addressing manufacturing workforce issues 
in conjunction with energy workforce issues only in cases where there 
is significant overlap in the labor pool and specific challenges. For 
example, I would not attempt to address outsourcing issues for 
manufacturing simultaneously with energy workforce issues. Utility jobs 
are largely unaffected by overseas outsourcing. However, it may be 
effective to address ASME qualified welder issues for both 
manufacturing and the energy workforce since the skill sets will be 
similar.
    Question 8. Your testimony highlighted an increase in nuclear 
engineering enrollment between 1998 and 2006. Can you identify factors 
leading to this increase?
    Answer. The increase in enrollment in nuclear engineering can be 
attributed to numerous factors. They include: the President's Committee 
of Science and Technology Advisor's (PCAST) 1997 report advocating the 
continuation of DOE's historical support for maintaining the discipline 
and stewardship of university infrastructure, Congressional support in 
legislation for increased federal investment in nuclear engineering 
education through the DOE University Reactor Infrastructure and 
Education Assistance Program during the late 1990's through 2006; 
increased media coverage and resultant public awareness about the 
nuclear renaissance; expanded career awareness outreach conducted by 
industry, professional societies and government; enhanced recruiting 
and hiring within the industry, government and national laboratories, 
and improved recruitment of students into nuclear engineering programs 
by universities.
    Question 9. In your testimony, you state that the ``nuclear 
industry faces additional hurdles. Specifically, there are few 
workforce training programs focused on the skills needed for successful 
employment in the nuclear energy industry.'' How would you address this 
issue at the federal level? At the state level? At the local level?
    Answer. At the Federal level, I would:

          1. Direct the Department of Labor, in cooperation with the 
        Departments of Energy and Education, the National Science 
        Foundation and the Nuclear Regulatory Commission, and in 
        consultation with the nuclear industry and organized labor, to 
        create an integrated, national nuclear workforce development 
        program. Key elements of this program would include: expanding 
        nuclear technology and nuclear career awareness at the primary 
        and secondary education levels; developing community college 
        and skill center training programs for nuclear technicians 
        (e.g. radiation protection technicians) based on industry 
        standards; supporting development of construction management 
        personnel for nuclear construction projects; and providing 
        regional grants for integrated nuclear workforce development 
        programs.
          2. Appropriate sufficient funds to the Department of Energy 
        for the execution of their stewardship responsibility for 
        Nuclear Engineering and Health Physics Education, to support 
        the necessary infrastructure for the continued safe operation 
        and needed upgrades of existing training and test reactors and 
        to develop new or expand the capabilities of existing training 
        and test reactors as needed.
          3. Provide tax incentives to support apprentice utilization, 
        incumbent worker training and displaced worker training for 
        employment in nuclear industries.

    At the State level, I would:

          1. Include the energy sector (specifically nuclear) in state 
        workforce development and economic development plans,
          2. Integrate nuclear-related jobs into the career cluster 
        framework used in each state,
          3. Provide academic credit for career and technical education 
        in nuclear-related fields at the secondary level and 
        articulation of this academic credit at the post secondary 
        education institutions,
          4. Provide funding for the maintenance of nuclear workforce 
        development programs at community colleges, skill centers and 
        other educational institutions,
          5. Develop more flexible teacher certification rules that 
        would facilitate nuclear professionals entering the classroom.

    At the Local level, I would work on better educating local schools 
science teachers, guidance councilors, and workforce development 
professionals about the career opportunities available in the nuclear 
industry and work to provide education opportunities for individuals 
who wished to enter these lucrative careers.
                                 ______
                                 
    Responses of Norm Szydlowski to Questions From Senator Bingaman
    Question 1. On page 5 of your testimony, you estimate that the cost 
of building a new pipeline along your existing pipeline between Baton 
Rouge and Atlanta has risen from $1 to 2 billion, how much of that 
increase is due to material and that due to a shortage of labor?
    Answer. From the time we first estimated the cost of this project--
about three years ago--to our current projection with completion in 
2012, labor cost and materials cost have doubled.
    Question 2. You note that you have the same retirement statistics 
as the rest of the petroleum sectors--27 percent eligible for 
retirement in five year except it is two years for Colonial. Does 
Colonial anticipate a large wave of retirements or do you believe your 
workforce will continue to work past retirement?
    Answer. Taken in its entirety, the 650-person workforce of Colonial 
fits the same eligible-to-retire profile as the rest of the petroleum 
industry. That is, 27 percent of our overall workforce will be eligible 
to retire within five years. Note that this snapshot of Colonial's 
workforce includes administrative, accounting, IT and all other 
workers--as well as those who are actively engaged in operating the 
pipeline. In our testimony, we attempted to describe a more focused 
picture of the challenge we face with employees responsible for 
operating the pipeline. (This includes a wide variety of engineers, 
controllers, schedulers and others in addition to those who physically 
operate the line for Colonial.) Our personnel records show that 35 
percent of our Operations workforce will be eligible for retirement 
within two years. While that number is slightly higher than the all-
inclusive employee number, it is the potential of losing these trained 
and experienced workers within two years that has focused all of us at 
Colonial (and especially our Human Resources Department) on finding 
ways to retain talented workers and recruit talented new employees.
    Question 3. You mention that foreign workers represent a sizeable 
pool of talent; do you know what countries Colonial typically hires 
from and what occupations?
    Answer. Colonial views those foreign workers who are legally 
permitted to work in the United States as one of several solutions to 
the rising labor challenge faced by the petroleum industry. Within our 
company, we have two employees--both engineers--who are not U.S. 
citizens. One is a system integrity engineer from Canada, and the other 
is a Venezuelan responsible for Colonial's electrical systems analysis, 
design, construction and maintenance. We do not keep records that 
distinguish nationalized citizenship for employees. However, a review 
of our employee roles suggests that there are approximately a dozen 
employees, primarily of eastern Asian heritage, who are U.S. citizens 
and work in the Engineering, IT and Operations fields. While greater 
access to a larger skilled workforce may contribute to Colonial's 
employment pool, the greater impact will be within the construction 
trades we contract with to build new lines and to help Colonial with 
repairs and other short-term projects.
    Question 4. You mention in your recommendations the ability to have 
the IRS provide relief on phased retirement so that retirement age 
employees can still contribute to the workforce--can you please explain 
this in more detail?
    Answer. This challenge is shared by other companies in our 
industry, but my examples will draw from Colonial's experience and from 
the policies in effect at our company. Colonial offers a very 
competitive benefits package in order to attract the talent we need. 
That package includes a pension plan that offers a lump-sum payout as 
soon as the early retirement age of 55 for qualified workers. Our 
experience has been that employees take advantage of this opportunity 
upon reaching the average age of 57, at which point their employment 
must be terminated. Many are interested in continuing to work, but IRS 
rules against ``sham retirements'' prevent them from continuing at 
Colonial after receiving their lump-sum pension payout. Most who are 
interested in continuing to work will go to other companies. A smaller 
number leave for a six-month waiting period before returning to 
Colonial either as a contractor or as a part-time worker.
    We hoped that the Pension Protection Act's phased-retirement 
initiatives would let companies make in-service distribution of 
retirement benefits. This would give persons who retired early to 
secure their lump-sum benefit a means of accessing their lump-sum 
benefit and remain with Colonial. However, the IRS rules do not allow 
this for employees under the age of 62. The IRS does allow companies to 
lower the full retirement age to 62 or below 62 if that is an industry 
standard. However, this option is prohibitively expensive because the 
retirement would be at full rates and not reduced for the early 
departure. Indeed, we expect this approach would give an even greater 
incentive to retire for -eligible, 55-year-old employees.
    A solution we offer for consideration is to lower the in-service 
distribution age for retirement plans from 62 to -55 -, and to retain 
the current plan's early retirement reduction factors. This would give 
Colonial, and companies like us, a legally permissible means of 
allowing employees their lump-sum pension benefit without reducing the 
full retirement standard of age 65. Companies could retain experienced 
workers and employees could secure their lump-sum benefit without 
having to terminate their employment. Effective Jan. 1, 2008, lump-sum 
calculations will be based on a New Mortality Table (which reflects 
that people are living longer) and New Interest Rates (based on 
corporate bond yields). The expected impact is that lump-sum benefits 
for persons retiring at age 55 will decline 1.4 percent in 2008 and by 
13 percent by 2013. This information will give eligible employees more 
reason to retire now.
    Responses of Norm Szydlowski to Questions From Senator Domenici
    Question 5. In your testimony, you point to ``more glamorous'' 
career opportunities and a perceived unreliability of the energy 
workforce as inhibitors to recruiting new workers. How would you 
address these perceptions? What role, if any, do you see for the 
Federal government in addressing these inhibitions?
    The perception of our company and our industry as worth the 
consideration of people searching for a career is primarily our 
responsibility. The American Petroleum Institute currently is 
conducting a significant education campaign to explain the industry's 
role and its work as a critical part of America's energy solution. All 
of us as individuals can recognize the value and honor of craftspeople 
and appreciate vocational/technical education. The message we often 
send our children, that the only successful career is the one that 
includes a four-year university degree and work in an office 
environment, must change. The Federal government can play a helpful 
role by coordinating state and regional workforce development efforts 
and facilitating their broader application.
    Question 6. You recommend IRS tax relief as a possible solution to 
retain retirement-eligible employees. Do you regard this tactic as a 
short-term or long-term solution?
    Answer. It would be an important part of the solution. Other 
actions are also necessary, such as better transfer of knowledge from 
the more-experienced employees to the newer ones. Increased recruiting 
from technical schools and four-year colleges is needed. But at a time 
of growing demand for knowledgeable workers, and a time when workers 
are willing and more able than ever to continue working, we should not 
increase the incentive to retire early through tax policy. The 
challenge of meeting the energy needs of a growing economy is a good 
problem to have. We will need the help, knowledge and innovation of our 
experienced workers along with that of our newer workers to solve it.
    In addressing this IRS-pension question from both Sens. Bingaman 
and Domenici, we have tried to be direct and concise in our reply. The 
following summary was provided by Colonial's Vice President of Human 
Resources, Wayne St. Claire, in case greater detail is helpful. Of 
course, we are ready to help further as you consider how to ensure the 
energy industry is adequately staffed and position to continue meeting 
our Nation's energy needs.
                               attachment
Retention Issues--Phased Retirement/In-Service Distributions
    Our employees retire (on average) upon reaching the age of 57 take 
advantage of our retirement plan's generous lump-sum pension benefit. 
They reason that they are better off if they retire, take their lump 
sum, and work elsewhere in a comparable job. They conclude that because 
the Pension Protection Act is decreasing lump sums and because it 
appears that interest rates are rising which also decreases lump sums, 
they had better retire now and get their lump sum before it goes down. 
As a result, we are losing our most experienced staff. In the next five 
years, we can lose 25% of our workforce due to retirement alone.
    In many cases, these retiring employees would like to continue 
working. They just want to secure their lump-sum benefit at an 
opportune time. The IRS rules do not allow them to retire to receive 
their lump sum and then be reemployed by us full-time. So, they retire 
and then go to other companies or contract back to our company, but 
this usually as part-time work under very strict and specific rules and 
guidelines.
    Our pension plan does not allow the participants to draw their 
pensions or receive their benefits without terminating employment. We 
hoped that Pension Protection Act phased retirement initiatives would 
permit companies to make in-service distributions of retirement 
benefits. This would permit persons who retired early just so they 
could receive their lump sum an alternate way to access their lump sum 
and stay with our company. The Pension Protection Act does this, but 
only for employees at least age 62. Consequently, these provisions are 
not very useful because they do not allow in-service distributions 
below age 62 where the majority of our retirements occur.
    There is a second way participants can access their pension and 
then continue to work with our company. New IRS regulations make it 
clear that plans can permit distributions after persons attain their 
normal retirement age. These new regulations also state that plans can 
lower their normal retirement age to 62 without any question or lower 
it to be below age 62 if a lower age is customary in the industry. 
While this would be a useful way of letting employees receive their 
lump sum while continuing to work, it is expensive because benefits are 
not reduced for early commencement at normal retirement age. Lowering 
the normal retirement age to say age 55-57 would be very costly. So, 
this approach is not useful.
    There is a principle that the retirement trust is a tax-favored 
vehicle and should have restrictions as to participants' ability to 
access the funds. So, under IRS rules participants need to separate 
from service to have access to their funds. In our case, employees are 
quite willing to separate from service to have access to the funds; 
they simply retire early to get the funds and go to work elsewhere. If 
an employer would let employees retire and then come back immediately 
to their old jobs, the IRS would view this as a ``sham retirement'' 
designed to skirt their rules. This is why companies that comply with 
the IRS rules place restrictions on reemployment. Since there is no 
clear guidance on what employers must do to avoid being accused of 
bypassing the rules, 5 the employers impose restrictions on rehire that 
generally involve a waiting period, reemployment only as a part time-
time employee, or a change in job duties. Faced with the prospect of 
working only part time or in a different job many retiring employees 
just go to work elsewhere, usually for our competitors.
    Our company has a comprehensive review process for hiring leased/
contract employees that include restrictions along the line of the 
restrictions described above. Our company understands the importance of 
classifying employees correctly since employees have many more rights 
than do leased/contract employees. Our company also requires legal 
review before rehiring former employees.
    The improvement Norm Szydlowski raised was to have the IRS lower 
the in-service distribution age for retirement plans from 62 to say 55 
or 56 while retaining the plan's current early retirement reduction 
factors and normal retirement age. Companies like ours need a legally 
permissible means of allowing employees receive their lump sum 
distributions without having to lower the normal retirement age which 
would greatly subsidize the entire participant population. This would 
give companies the ability to retain employees with years of valuable 
work experience yet continue contributing to our company instead of our 
competitors. That way, employees get access to their pension benefits 
and have the option of continuing their career with their current 
employer. In the foreseeable future, companies like ours who offer 
valuable benefits to our employees could lose valued employees in a 
period of time when we need most of these employees to continue meeting 
the needs of our customers, the national security and economy of this 
country, and have the ability to reasonably transfer knowledge from our 
existing workforce (before they retire) to our new employees.
Effect of PPA on Lump Sums
    Effective January 1, 2008, The Pension Protection Act modified the 
minimum lump sum requirements by specifying that lump sum calculations 
be based on:

   A New Mortality Table--The table not only reflects that 
        people are now living longer, but also project future 
        improvements in mortality.
   New Interest Rates--New interest rates based on corporate 
        bond yields replace the 30-year Treasury Bonds rates that are 
        currently used. There are three interest rates--one rate for 
        the benefits expected to be paid in the first five years, a 
        second rate for the benefits to be paid in the next 15 years 
        after that, and a third interest rate for benefits expected to 
        be paid more than 20 years in the future.

    The expected impact is that lump sums of persons retiring at age 55 
will decline 1.4% in 2008 and by 13% in five years when the new lump 
sum basis is fully phased in.
Survey Information
    Here are some third-party surveys and statistics you may find 
helpful:

   The Society of Actuaries' Phased Retirement and Planning for 
        the Unexpected, 2005 Risk and Process of Retirement Survey 
        found that only 38% of pre-retirees actually stopped working 
        all at once.
   A 2005 AARP survey found that 40% of 50+ retirees would be 
        interested in participating in a phased retirement program 
        (i.e., reduced work schedule).
   A January 2006 AARP Public Policy Institute paper reviewed 
        study results by researchers at the University of 
        Massachusetts-Boston and Cornell University which found that 
        phased retirement was more prevalent among better educated, 
        white-collar, or highly skilled workers. It also found that it 
        is more prevalent at the younger end of the of the older worker 
        age span, reflecting a transition to full retirement. Persons 
        who work for the same employer as a phased retiree are more 
        likely to have more positive views of work than those who come 
        from other employers. Many phased retirees would work even when 
        they do not need the income--i.e., money is not the only 
        motivator for work.
   In addition, AARP reported in a research report in March of 
        2005 that the number of workers age 55 and older is expected to 
        increase 49% while the number of workers under age 55 is 
        expected to grow by only 5%. AARP noted that employers who do 
        not attract and retain older workers might have difficulty 
        finding qualified workers.
Caring About Retiring Employees
    Retaining our experienced workforce is not our only objective. We 
find that our retiring employees think in terms of today's dollars. 
They do not understand how general inflation, rising health care costs, 
and extended lifetimes will require greater retirement amounts than 
ever. If we can keep them in our workforce longer, either as full-time 
or part-time employees, we can continue educating them and help them 
accumulate the additional funds they will need to cover rising future 
costs. We want them to make the right financial decisions based on 
solid knowledge.
                              Appendix II

              Additional Material Submitted for the Record

                              ----------                              

      Statement of Will Green, President, American Association of 
                          Petroleum Geologists
    To the Chair and Members of the Committee: I would like to thank 
the Chairman and this Committee for holding a hearing on the workforce 
challenges facing the domestic energy sector. It is a challenge. As 
President of the American Association of Petroleum Geologists (AAPG) I 
want to assure you that we are taking active steps to address it. But 
U.S. national and economic security also demands federal action to 
ensure the availability of a future petroleum industry workforce.
    AAPG, an international geoscience organization, is the world's 
largest professional geological society representing over 30,000 
members. The purpose of AAPG is to advance the science of geology, 
foster scientific research, promote technology and advance the well-
being of its members. With members in 116 countries, more than two-
thirds of whom work and reside in the United States, AAPG serves as a 
voice for the shared interests of petroleum geologists and 
geophysicists in our profession worldwide. Included among its members 
are numerous CEOs, managers, directors, independent/consulting 
geoscientists, federal and State regulators, educators, researchers and 
students.
    AAPG strives to increase public awareness of the crucial role that 
geosciences, and particularly petroleum geology play in energy security 
and our society. As the National Petroleum Council (NPC) notes in its 
2007 study, Hard Truths: Facing the Hard Truths about Energy, oil and 
gas demand will not abate anytime soon. Aggregating data from multiple 
oil and gas demand predictions, they report:

   Global oil demand in 2030 will be 103 to 138 million barrels 
        per day, up from 76 million in 2000;
   Global natural gas demand in 2030 will be 152 to 225 
        trillion cubic feet per year (TCF), up from 94 TCF in 2000;
   U.S. oil demand in 2030 will be 22 to 30 million barrels per 
        day, up from 19 million in 2000; and
   U.S. natural gas demand in 2030 will be 25 to 30 TCF, up 
        from 21 TCF.

    Where is the workforce that will ensure there is adequate supply to 
meet this demand in 2030? According to U.S. Department of Labor 
estimates, over one-half of the U.S. technical workforce will retire in 
the next fifteen years. The NPC 2007 study concurs, stating that 
``Nearly half of the personnel in the U.S. energy industries will be 
eligible for retirement within the next ten years, and fewer people 
have entered the workforce over the past generation.'' The demographics 
of AAPG's 30,000 members demonstrate the challenge: The median age of 
our members in 1991 was 41, in 2001 it was 48, and in 2006 it was 53.
    And it isn't just industry that is facing the challenge. AAPG's 
membership includes many faculty members whose hair color is as gray as 
that of their industry colleagues, and there are fewer faculty prepared 
to teach the next generation of geoscientists and engineers. According 
to the American Geological Institute, the number of geosciences 
bachelor degrees has decreased from 7,180 in 1982 to 2,436 in 2005, a 
66% decline. The number of geosciences master degrees decreased from 
2,047 in 1987 to 1,074 in 2005, a 48% decline. And the number of 
geosciences doctoral degrees reached a peak of 1,058 in 1989 decreasing 
to 457 in 2005, a 57% decline.
    The good news in these bleak statistics is that we have seen an 
uptick in petroleum geosciences and engineering enrollments in the past 
year. This suggests that students have become aware of the career 
prospects in the petroleum industry, and are interested in pursuing 
related geosciences and engineering studies. We're getting the 
students' attention. The question is whether we, as a Nation, can 
provide the opportunities and infrastructure needed to turn this uptick 
into a sustained reversal.
    The federal government needs to play an active role in reversing 
the current petroleum workforce trends. Programs that encourage science 
and math education in elementary and secondary schools provide a solid 
foundation for students entering university. At the university level 
much of the federal support for science comes in the form of 
competitive research funding. This funding provides direct benefit to 
society by enhancing our understanding of the natural world and 
developing new technologies. The second, no less direct, benefit is 
that these funds provide research support for faculty, graduate 
research opportunities, and the means to develop and maintain 
laboratories and instruments to conduct this research.
    The elimination of the Department of Energy's oil and gas research 
program has significantly impaired the Nation's ability to train a 
future petroleum workforce. These funds had historically provided this 
support to geoscience and petroleum engineering programs at U.S. 
universities. The funds are now gone, weakening the departments at the 
same time as we're asking them to attract and train talent for the next 
generation.
    The America COMPETES Act of 2007 is a very good start. But it does 
not go far enough to ensure that we can successfully reverse current 
workforce trends.
    AAPG recognizes that the solution to the Nation's petroleum 
workforce challenge requires both government and private involvement. 
To that end, I would like to share with you what AAPG is doing to 
promote interest in geosciences, and particularly petroleum geology, 
and its positive impact on the United States.
    Through our local affiliated societies we strongly encourage 
elementary and secondary school students to take classes in science and 
math. In October 2007 many of our societies participated in the Earth 
Science Week program of the American Geological Institute. The West 
Texas Geological Society, my local society, sent volunteers into 50 
local schools to talk to fourth to sixth grade students about the 
geosciences. In addition, AAPG's regional sections train middle school 
teachers in geology, with applications to petroleum geology, through 
our ``Rocks in your Head'' seminar.
    The AAPG Foundation's Grants-in-Aid program supports graduate 
students in earth sciences whose research has application to the search 
for and development of petroleum and energy mineral resources and to 
related environmental geology issues. These awards are competitive, and 
in 2006 AAPG celebrated the 50th anniversary of this program.
    We also support the Visiting Geoscientists Program where 
professional geoscientists visit campuses, give lectures or seminars, 
and meet with students. These one-on-one interactions give students an 
opportunity to discuss career options and learn from someone who is 
professionally active in the field.
    AAPG encourages the development of student chapters at schools 
around the world. There are currently 160 student chapters worldwide, 
80 in the United States and 80 internationally. We regularly conduct 
student expos for students to meet with the oil industry to receive 
career information. And just this year AAPG launched a contest for the 
student chapters that provides a real-world experience of working as a 
team to predict the petroleum exploration potential of a particular 
geologic basin. The contest was well received, and we're expanding it 
this year.
    In addition to our educational activities in schools, colleges, and 
universities, AAPG has a long history of providing its members with 
continuing education programs. These programs range from day-long 
workshops to week-long short courses and field trips.
    We have recently moved to significantly increase this activity 
through the Petroleum Technology Transfer Council (PTTC). The program 
was developed by oil and gas producers with the support of the 
Department of Energy and designed to provide continuing education 
workshops and technology transfer to oil and gas producers on 
engineering, geology, geophysics, and oil and gas operations and 
technologies. PTTC links universities, State geological surveys and 
bureaus, local oil and gas producers and others involved in the 
industry. On September 27, 2007 the PTTC board approved a proposal by 
AAPG to assume leadership of PTTC. We will continue to work closely 
with the organizations that have been involved in the past, including 
the Department of Energy, and are inviting other associations to join 
us.
    Our current workforce challenge did not emerge overnight, and 
neither will the solution. But it is essential to find a solution if 
the United States is to develop its oil and gas resources in a 
beneficial and environmentally responsible way. Mr. Chairman, I want to 
thank you for holding this hearing and encourage you to hold additional 
hearings to further highlight the national workforce challenge we face 
in the petroleum and other industries. The federal government must play 
an active role to solve the problem. But by working cooperatively, I 
believe we can. AAPG stands ready to assist.
    Thank you for the opportunity to submit this testimony to the 
Committee.
                                 ______
                                 
Statement of Daniel H. Lopez, President, New Mexico Institute of Mining 
                      and Technology, Socorro, NM
    Thank you for your leadership and commitment to the workforce 
crisis in the United States and for the November 5, 2007 hearing before 
the Senate Energy and Natural Resources Committee. As you know, this is 
an issue of great importance to New Mexico Tech, the citizens of New 
Mexico and the American people.
    This hearing and others that follow will serve to help identify 
where members can effectively focus attention and resources to insure 
the needs of the American people are met. Mr. Chairman, I urge you to 
have additional hearings on this important issue. Today's discussion 
only addresses part of the problem. The Committee must fully explore 
the educational crises in the Nation's geologic, petroleum and mining 
sector. This is made even more important because this Nation will need 
more skilled geologists as we explore ways to capture & store carbon 
dioxide in deep rock formations, as recently announced by the U.S. EPA.
    We truly have an education & workforce crisis in this country that 
if left unchecked will harm our national security, ability to compete 
with the rest of the world and our fundamental way of life. The United 
States is the world's largest user of mineral commodities. Minerals and 
petroleum power our cars, computers and homes, accounting for nearly 
$500 billion of the U.S. economy. The continued development of our 
Nation's resources is a critical factor in maintaining our quality of 
life and ensuring that our Nation has the basic fuels and materials to 
keep our economy strong.
    Workforce availability has become a significant problem for the 
domestic petroleum and mining industries. Numerous reports have 
repeatedly warned that not enough students are graduating from these 
programs schools to replace the large number of active engineers and 
geologists who will be eligible to retire in the next 10 years. The 
number of college students pursuing petroleum and mining degrees 
dropped 80 percent over the last two decades and the Nation is now down 
to 17 petroleum schools (from 34 in 1983) and 12 mining schools (from 
25 in 1983).
    An example of the extent to which the age profile of mining 
professionals is advancing can be gained by examining the ranks of the 
geoscientists (geologists, geophysicists, metallurgists, and mining 
engineers) employed by the United States government. Around 2500 of 
these professionals are employed by the various federal agencies, with 
around 60% in the Department of the Interior. Just slightly under half 
(49.4%) of these individuals are currently over the age of 50, and a 
quarter of the (25.5%) over 55. The demographics for the subset holding 
positions as mining engineers--a more direct indicator of the situation 
facing the U.S. mining industry--are identical.
    At the same time, government funding for university research in 
mineral resources disciplines has been eliminated or greatly reduced. A 
large percentage of the faculty in mineral resources programs are 
retiring and there are few PhDs in the pipeline to replace them.
    Further compounding the problem, according to the U.S. Bureau of 
Labor Statistics, almost half of the working engineers and geologists 
in the petroleum and mining industries are over 50. The potential for 
significant workforce losses to retirement in the next 10 years is huge 
while the number of replacements is much too low to sustain the 
industry. Among the mining schools, the situation is nearing a critical 
point as 25 percent of the Nation's mining engineering 70 faculty 
members expect to retire in the next 5 years; fully 50 percent expect 
to retire in the next 10 years.
    Skilled trades people are in short supply across the industry. 
Industries looking for qualified applicants to fill these jobs are 
often forced to turn to foreign schools to fill their vacancies. 
Without an adequate workforce, the basic building blocks of the 
economy--energy and minerals cannot be domestically produced.
    We recently wrote to urge your support for the Energy and Mineral 
Schools Reinvestment Act (EMSRA). EMSRA sets out the policies for 
maintaining a healthy domestic energy and mineral workforce at the 
professional, technical, and blue collar levels. It establishes policy 
to fund research to support the educational institutions that produce 
the workforce. It establishes policy for sustainable energy and mineral 
development by the application of science and engineering. It sets the 
goal of sustaining and protecting America's competitive edge in the 
21st century economy through research.
    In sum, EMSRA will begin to restore the petroleum and mining 
engineering and technological world leadership of the United States 
which has been maintained for more than two centuries. It means New 
Mexico Tech and similar institutions or programs, from West Virginia to 
Arizona, Pennsylvania to South Dakota, and others can build capacity in 
petroleum and mining teaching and research that would attract the best 
and brightest faculty and students for the coming energy resource 
global competition.
    We strongly urge you to sponsor EMSRA and to do everything in your 
power to have Congress enact this legislation during the current 110th 
congressional session. This legislation can have a regenerative impact 
on the Nation's mining and petroleum engineering schools and encourage 
the growth of the energy and minerals workforce to meet the Nation's 
needs.
    The consequences for failing to address this educational crisis are 
real, and include: higher commodity prices, overall loss of industry, 
loss of technology, and educational infrastructure. In short, you lose 
the ability to educate the people necessary to produce the energy for 
this country over the long term.
    Thank you for your support and leadership on this important issue 
to the state of New Mexico and the Nation.
                                 ______
                                 
                                  Consumer Energy Alliance,
                                    Houston, TX, November 13, 2007.
Hon. Jeff Bingaman,
United States Senate, Washington, DC.
Hon. Pete Domenici,
United States Senate, Washington, DC.
    Dear Chairman Bingaman and Senator Domenici: Consumer Energy 
Alliance applauds the Committee on Energy and Natural Resources for 
recognizing the importance of a strong domestic energy workforce. While 
we appreciate the efforts of the committee and chairman to address this 
important issue, we also encourage you to expand your focus to include 
education programs for petroleum, mining and geological engineers, as 
these programs are the foundation for a healthy energy workforce and 
economy.
    The strength and success of our Nation depends on a highly-skilled, 
competitive workforce equipped with education and training. In the past 
few decades, workforce availability has become a significant problem 
due to the lack of petroleum, mining and geological programs in the 
U.S. The number of students graduating with petroleum and mining 
degrees dropped more than 80 percent over the last two decades, and the 
Nation is now down to 17 petroleum schools (from 34 in 1983) and 12 
mining schools (from 25 in 1983). Studies show that there are simply 
not enough petroleum and mining graduate students to replace the active 
engineers and geologists who plan to retire in the next ten years, 
creating a 38 percent shortage of qualified U.S. engineers and 
geologists by 2009. A severe lack of qualified professionals threatens 
our ability to compete in today's rapidly changing global economy.
    What was once an issue of concern has now become a national crisis.
    In order to raise awareness on the gravity of this situation, 
Consumer Energy Alliance is working with members of our Board and 
interested stakeholders to bring the petroleum, mining and geology 
industries together with academia to organize and mobilize a broad 
coalition in support of engineering education. We recognize the 
importance of academic institutions in creating a highly-skilled 
workforce and in generating the research base necessary for the 
competitiveness of tomorrow's industry. We are also aware that failure 
to support these programs will ultimately increase our Nation's 
dependence on foreign sources of intellectual capital, threatening 
domestic economic and energy security.
    If we fail to generate the necessary support for our Nation's 
education infrastructure, current workforce trends in these vital areas 
will only worsen. We have already seen severe declines in the number of 
training programs around the country, and now our schools are nearing a 
critical point as 25 percent of the Nation's 70 mining engineering 
faculty members expect to retire in the next 5 years and 50 percent 
expect to retire in the next 10 years. The aging of faculty and a 
decline in graduates could result in a serious shortage of teaching and 
research staff, as well as talented workforce. point as 25 percent of 
the Nation's 70 mining engineering faculty members expect to retire in 
the next 5 years and 50 percent expect to retire in the next 10 years. 
The aging of faculty and a decline in graduates could result in a 
serious shortage of teaching and research staff, as well as talented 
workforce.
    A lack of qualified engineering professionals hinders our ability 
to develop new energy resources and technologies, and with the demand 
for crude oil on the rise, it is vital that we act now to improve the 
workforce crisis. In a 2007 report, the National Petroleum Council 
found that oil and gas demand will significantly increase in the next 
30 years. For example:

   Global oil demand in 2030 will be 103 to 138 million barrels 
        per day, up from 76 million in 2000;
   Global natural gas demand in 2030 will be 152 to 225 
        trillion cubic feet per year (TCF), up from 94 TCF in 2000;
   U.S. oil demand in 2030 will be 22 to 30 million barrels per 
        day, up from 19 million in 2000; and
   U.S. natural gas demand in 2030 will be 25 to 30 TCF, up 
        from 21 TCF.

    Without an adequate workforce to access and develop energy 
resources, we could face serious shortages in energy supply that 
jeopardize our economic security. Consumers are already feeling the 
impact of high energy prices, as business energy costs increased 51 
percent from 2000 to 2005, and companies such as American Airlines are 
paying billions of dollars more for fuel each year. With the price of 
gasoline increasing 105 percent since 2001, the price oil approaching 
$100 a barrel, and global energy demand on the rise, it is more 
important now than ever to support the institutions and professionals 
that work to improve domestic energy security.
    Consumer Energy Alliance is extremely concerned about the future of 
our Nation's petroleum, mining and geological programs, as well as our 
economy. We encourage you to boost support for the academic 
institutions that provide education and training for these 
professionals so that we may replenish our dwindling energy workforce 
and strengthen national security. A healthy education system is vital 
to the production of a well-qualified workforce able to meet the needs 
of the industry and compete with the ever-changing global economy.
    Once again we thank you for your efforts in addressing our Nation's 
energy workforce issue, but we hope you will hold additional hearings 
to consider petroleum, mining and geological education. These 
professionals play a critical role in energy and economic security, 
making it vital that interested stakeholders and the federal government 
work together to increase support for the academic institutions that 
sustain and protect America's competitive edge in the 21st century.
            Sincerely,
                                                David Holt,
                                                Executive Director.
                                 ______
                                 
              Independent Petroleum Association of America,
                                 Washington, DC, November 20, 2007.
Hon. Jeff Bingaman,
Chairman, Committee on Energy and Natural Resources, U.S. Senate, 
        Washington, DC.
Hon. Pete V. Domenici,
Ranking Member, Committee on Energy and Natural Resources, U.S. Senate, 
        Washington, DC.
    Dear Chairman Bingaman and Senator Domenici: On behalf of the 
Independent Petroleum Association of America (IPAA), representing over 
5,000 independent producers of American oil and natural gas, I would 
like to thank you and the committee for shedding light on the mounting 
workforce challenges the domestic energy sector continues to face. 
Meeting America's growing demand for oil and natural gas will require a 
skilled, educated workforce. IPAA and its members, who drill 90 percent 
of all American wells and produce 68% of domestic oil and 82% of 
domestic natural gas, would like to work with you and your staffs in 
your attempt to address this important, but challenging issue.
    The problems associated with meeting the workforce needs of the 
energy sector, and in particular the oil and gas extraction industries' 
needs are not new. The American petroleum industry reduced its 
workforce fully 60% between 1986 and 2000, with a record 38,000 job 
lost in 1999 alone, due in large part to the volatility of the market. 
Of the remaining oil and natural gas industry workforce, half are now 
between the ages of 50 and 60, while only 15 percent are in their early 
20's to mid-30's. The average age in the industry is 48, with some 
major and super major companies reporting an average age in the mid-
'50's. According to one of the larger independent producers quoted in 
the Interstate Oil and Gas Compact Commission's (IOGCC) report, 
``Petroleum Professionals--Blue Ribbon Task force: A Follow-up Report'' 
(Jan. 2007), ``One third of our (the industry's) geotechnical staff is 
eligible to retire in the next five years.'' According to an American 
Petroleum Institute's (API) 2005 report on workforce issues, since the 
peak employment of more than 860,000 jobs in the petroleum industry in 
1982, more than 500,000 jobs were lost by 2000. The report goes on to 
say that ``this sharp drop was accomplished by sustained layoffs, which 
gave the industry a reputation of an unreliable employer and sharply 
curbed entry into the industry by nearly a full generation.''
    After peaking at 11,000 in 1982, petroleum engineering enrollments 
in the U.S. fell to a low of 1,300 in 1997--a year before the most 
recent downturn. Although there has been a slight up tick in the number 
of enrollments within the last 2 years, in 2005 for example, enrollment 
in petroleum engineering in U.S. universities stood at approximately 
1,500, still down 85% from the 1982 peak. In 2004, only 303 students 
graduated with bachelor's degrees in petroleum engineering in the U.S., 
according to a study by Texas Tech petroleum engineering department 
head Lloyd Heinze. From 1982 to 2005, the number of baccalaureate 
programs producing petroleum engineers declined from 34 to 16, while a 
very similar scenario occurred in the geosciences programs. The number 
of undergraduate geologists in U.S. universities plunged to 3,381 in 
2003 from 7,524 in 1984, reflecting a drop ite 300 Washington, D.C. of 
55%. For example, in 1982, approximately 4,000 advanced degrees (PhD 
and masters) were awarded in the geosciences, with about 50% winding up 
employed by the petroleum industry. These days that number is about 500 
annually, with perhaps 100 of them entering the petroleum industry. 
Considering that the National Petroleum Council (NPC) notes in its 2007 
study, ``Hard Truths: Facing the Hard Truths About Energy'', that the 
rise in demand for supply of oil and natural gas will continue, with 
U.S. oil demand in 2030 expected to be 22 to 30 million barrels per 
day, up from 19 million in 2000, and U.S. natural gas demand expected 
to be 25 to 30 trillion cubic feet per year (TCF) up from 21 TCF in 
2000, educating and sustaining an adequate and skilled workforce in 
order to meet these needs should be viewed as an issue of paramount 
importance.
    IPAA views education as the key to developing and sustaining a 
skilled workforce. In its workforce mission statement, IPAA states the 
need to both educate and encourage target audiences as to the 
prospective career opportunities associated with the oil and natural 
gas industry. In fact, IPAA's board of directors, at its recent annual 
meeting in San Antonio, Texas, moved forward with the consolidation of 
its separate Workforce and Education Committees, demonstrating the 
inextricable linkage between the two areas. IPAA also views as vital 
the development of initiatives that encourage both professional and 
vocational education to expand the industry workforce, necessarily 
covering both ends of the spectrum.
    IPAA is working in secondary schools and universities to reveal the 
employment opportunities in the oil and natural gas industry.
    The IPAA Educational Foundation, founded more than a decade ago, 
has provided funding to dozens of nationwide programs that help educate 
consumers, lawmakers and students about the industry. Detailed in this 
brochure are the successful undertakings that IPAA has been able to 
work on thanks to the contributions of its member companies, volunteers 
and staff.
    In 2006, IPAA launched its Education Center in Houston. The 
Education Center is dedicated to coordinating initiatives in public 
education and workforce expansion. IPAA education initiatives operated 
by the Education Center, include:

    Academies for Petroleum Exploration & Production Technology.--IPAA 
is pleased to announce that the Advanced Placement Math and Science 
Program at Milby Science Institute was chosen as the first IPAA 
sponsored academy in the country--with more to come in California, 
Colorado and Texas. IPAA has coordinated the curriculum development as 
well as programs that encourage the collaboration between academia and 
industry, student field trips, industry speakers, internships/mentoring 
plus various other educational initiatives. IPAA has also spearheaded 
the drive to bring laptop computers, reservoir software, as well as 
technical equipment to this unique advanced academic learning 
environment.
    Science and Engineering Fair of Houston (SEFH).--IPAA is a co-
sponsor of the 48th Science and Engineering Fair of Houston. The fair 
includes entries from over a hundred schools and more than 28,000 
projects entered in the preliminary school/district fair competitions.
    The NEED Project.--IPAA serves on the board of the National Energy 
Education Development Project, a 501(c)(3) nonprofit education 
association dedicated to promoting a realistic understanding of the 
scientific, economic, and environmental impacts of energy so that 
students and teachers can make educated decisions. To ensure that 
teachers and students are working with accurate information, NEED 
materials are updated on a regular basis, using the latest data from 
the U.S. Energy Information Administration, as well as from a wide 
range of energy industry partners. NEED works with educators and 
students to improve existing materials and develop new ones to meet 
national and state curriculum requirements. NEED provided curriculum, 
hands-on kits and training to over 52,000 classrooms in 45 states.
    The Taft Oil-Technology Academy.--IPAA is working with the Taft 
Oil-Technology Academy in California provides 10th through 12th grade 
curriculum in industry-related courses of study (college prep 
curriculum), while enabling and encouraging them to earn paid 
internships at leading oil and technology companies, obtain employment 
after graduation, and pursue higher education.
    World Affairs Council of Houston/Global Energy Initiative.--As one 
of the largest funding sources for the Council, IPAA has helped 
introduce energy policy issues to students. Last year over 330 Texas 
Teachers benefited from the Council's energy programs impacting 43,000 
students statewide.

    Over the next year, we hope to build on IPAA's educational 
initiatives throughout the country. Again, we thank the Committee for 
turning its attention to this important issue, an issue that is 
inextricably linked to meeting the oil and natural gas supply needs of 
this Nation. The Committee has made a good first step towards 
addressing this issue in the form of its November 6 hearing; however, 
since the witness list did not include any witnesses from the oil and 
gas extraction community, we would urge you to consider scheduling a 
second hearing, in order to allow you to hear from the entire energy 
sector. In the interim, we look to working with you and your staffs as 
you attempt to take on this difficult, but important issue.
            Sincerely,
                                          Barry M. Russell,
                                                 President and CEO.
                                 ______
                                 
  Statement of Mary Poulton, Department Head and Professor, Mining & 
       Geological Engineering, University of Arizona, Tucson, AZ
    Mr. Chairman, thank you for your leadership and commitment to 
workforce issues in energy and natural resources. I urge the committee 
to conduct additional hearings on the workforce education crisis in 
this country to more fully develop the extent of the problem we face in 
educating mining and petroleum engineers and resource geologists and 
developing near-term solutions. Time is of the essence in solving these 
problems, and I look forward to working with the committee on a hearing 
to explore these important issues in the coming days.
    I am Dr. Mary M. Poulton, Professor and Head of the Department of 
Mining and Geological Engineering at the University of Arizona. On July 
8, 2004 I testified in front of the House Subcommittee on Energy and 
Mineral Resources regarding the impending ``demographic earthquake'' in 
the energy and minerals sectors. I will summarize some of my testimony 
here and provide updated information.
                        from july 2004 testimony
          We are faced with a situation where the engineering workforce 
        in the minerals and petroleum sectors are aging and we are 
        losing our capability to educate the next generation of 
        engineers because of the frail state of mining engineering and 
        petroleum engineering departments at US universities. I believe 
        for mining engineering we are in a crisis and a crisis is an 
        opportunity.
          The mining business is ``graying,'' with the great majority 
        of current workers approaching retirement in the coming 10-15 
        years, and few younger workers entering the business. Nowhere 
        is this fact more evident than in the professional ranks 
        underpinning the industry. SME statistics are instructional. 
        The portion of members over 50 years old will soon exceed 60%, 
        with the number of new professional level entrants almost 
        insignificant--less than 4% of the 2003 membership is younger 
        than 30.
          An example of the extent to which the age profile of mining 
        professionals is advancing can be gained by examining the ranks 
        of the geoscientists (geologists, geophysicists, metallurgists, 
        and mining engineers) employed by the U.S. government. Around 
        2500 of these professionals are employed by the various federal 
        agencies, with around 60% in the Department of the Interior. 
        Just slightly under half (49.4%) of these individuals are 
        currently over the age of 50, and a quarter of the (25.5%) over 
        55. The demographics for the subset holding positions as mining 
        engineers--a more direct indicator of the situation facing the 
        U.S. mining industry--are identical.
          The convergence of these two trends--the approaching 
        retirement of the experienced mining cohort and lack of young 
        people entering the industry--has a major negative implication 
        for Arizona's First University--Since 1885 mining companies. 
        The opportunities to transfer experience from the older to the 
        younger generation has been seriously impaired.
          We are losing our technical mineral resource workforce, 
        especially our academic mining engineering workforce, in this 
        country and we do not have a global surplus on which to draw. 
        Once you lose your capability to educate a technical workforce 
        you do not easily regain it. We are on the verge of losing that 
        capability in the US and I thank this Subcommittee for their 
        interest and advocacy.
          The University of California Berkeley, University of 
        Illinois, Ohio State, University of Minnesota, University of 
        Alabama, University of Idaho, Columbia University, University 
        of Pittsburgh, Texas A&M, University of Washington, University 
        of Wisconsin--Madison and Platteville, University of Wyoming 
        have all closed their mining engineering programs since 1985, 
        most on this list have closed since I made the decision to 
        enter academia in 1987.

    James Wicklund also testified at the July 8, 2004 hearing, focusing 
on issues in the energy sector and the economic implications of our 
declining workforce. Mr. Wicklund, in answer to questions from 
Chairwomen Cubin, testified that when we lose the technical workforce 
capacity in the energy sector (and the same is true of the minerals 
sector) in this country we lose leadership in the industry. When we 
lose leadership we lose the ability to affect purchases from suppliers 
in this country. When we lose suppliers we lose high paying jobs, and 
the tax base they support. The repercussions are felt beyond just the 
lack of the technical professionals and the multiplier for the economic 
impact is large.
                           current situation
    Undergraduate enrollments at most mining engineering programs have 
responded to market forces and have risen to 906 enrolled in 2006. In 
2006, 128 BSc mining engineers graduated in the US, up from a low of 86 
in prior years. Yet, the shortfall for mining engineers in the US to 
replace retirees is projected to be 300% and when production increases 
are factored in (including the oil sands industry in Canada which hires 
US graduates) we may be short by 600%. The workforce shortage is not 
just restricted to university degrees but is also felt in the skilled 
trades such as diesel mechanics, electricians, pipe fitters, etc. The 
shortage has already manifested itself as major delays and cost 
overruns on new mining projects. The next manifestation is being felt 
in safety.
    Our capacity to increase enrollments in our university programs is 
limited. Faculty sizes for mining programs in the US are typically 5-10 
full time professors supplemented by part time adjunct faculty. Faculty 
sizes in Canada, Australia, and South Africa tend to be larger than US 
mining faculties. Faculty sizes in the US tend to be small because 
federal research opportunities to support faculty and their graduate 
students are nearly nonexistent after the closure of the US Bureau of 
Mines. Other countries have supported technological advances to a much 
greater degree, to the point where US R&D dollars are being spent in 
Australia instead of the US because the Australian government will 
leverage those dollars and the US government will not.
    The age profile of mining engineering faculty is another limiting 
factor in expanding capacity. Professor M. K. McCarter from the 
University of Utah has published an analysis of the current and future 
professorate in mining engineering in the September 2007 issue of 
Mining Engineering (p. 28). The number of mining engineering faculty in 
the US peaked at nearly 120 in 1984 and today there are a total of 86 
budgeted lines for mining engineering faculty at all US universities 
with mining engineering departments. The average age of the faculty is 
52. We expect nearly 30 retirements out of the 86 faculty lines in the 
next 5 years. Of the 27 of PhD candidates expected to graduate in 2007 
only 4 are expected to even consider the option of a university 
position. Further exacerbating the problem, the specializations of 
current Ph.D. candidates is mismatched with the anticipated 
specializations to replace retiring faculty. For example, there is a 
pressing need for mine design specialists and there are almost no PhD 
candidates in this area.
    The recent National Research Council publication on ``Minerals, 
Critical Minerals, and the U.S. Economy'' outlines how essential 
minerals are to vital sectors of our economy from defense to 
telecommunications and computers to automotive. Everything we use on a 
daily basis starts with a mined commodity. We have enjoyed an economy 
of abundance for more than 50 years and take for granted that we will 
always be in first position anywhere in the world to take resources 
from others that we are not willing to produce ourselves. This is no 
longer the case. Not only do we increasingly lack the political and 
economic clout to develop resources in other countries but we are 
quickly losing the technical capability as well. Do we want an economy 
of scarcity to be our legacy?
    From my perspective, the way forward is obvious.

          1. We must have a rational mineral policy and legal framework 
        that ensures we can provide basic materials for our economy. 
        Rational mining law reform can accomplish this.
          2. We must have a research base that tackles the grand 
        challenges in mineral resource development that will allow 
        environmental protection, growth, and resource development to 
        co-exist. The Energy and Mineral Schools Reinvestment Act can 
        accomplish this.
          3. We must communicate to our university presidents that the 
        remaining mining engineering departments in the US must be a 
        priority for support so we do not lose more capacity. Letters 
        or meetings with the 13 university presidents with mining 
        programs can accomplish this.

    Mr. Chairman, you are in a position to make a major contribution to 
the country that will last for generations by taking action on these 
issues.