Burgh Energy Report: Economic Boom Blowing In The Wind

I'll get to the alternative energy news in a bit. I've got some follow up on the Exxon deal which merits mention. A few days ago, Loren Steffy of the Houston Chronicle offered an analysis of the XTO purchase. Natural gas drilling is dominated by smaller companies who are currently desperate for capital. The supply glut is keeping prices low and margins small, leaving little money for reinvestment and expansion. That's not a problem for Exxon Mobil. The bold move into the US unconventional gas market all but assures the continuing development of the Marcellus Shale Play even in an economic climate of cheap natural gas. The rising concern is the environmental impact of hydraulic fracturing, which could either raise the costs of drilling or ban the practice entirely.

The big news over the past week is the rise of wind energy and its economic stamp on Southwestern PA. Something for Chris Briem's Pittsburgh hagiography file is a celebration of the region's transition from steel production to windmill manufacturing. A bit more below the radar is the role of startup capital in this emerging industry:

• Sustainable Technologies Fund

• STF is a private equity growth fund looking to take “clean technologies” and “sustainable” companies to market.

• It is based in Stockholm, Sweden with offices in Pittsburgh.

• Along with major ownership of Havgul Clean Energy, the fund’s portfolio of companies includes a Norwegian solar power company, a Swedish heat pump manufacturer, a Swedish transformer company and a Swedish advanced boiler energy firm.

To help you connect the dots, Havgul is proposing a large wind-farm off the coast of Western Michigan. I think this suggests Pittsburgh as a base of operations for foreign direct investment in Rust Belt energy projects. Along those lines, check out this featured job posting over at Dewey & Kaye:

A unique entity with the working legal title of “The Regional Opportunity Center” has been created to educate, elevate, attract and retain diverse workers in the Pittsburgh region. Led by a new and influential Board of Directors, this movement is broad based and gaining momentum and it is time to hire the CEO to transform this momentum into an impactful initiative. Because a name and brand will be among the first objectives of this new initiative, this effort will hereafter be referred to as “The Initiative” to convey both its breadth and to avoid labeling until consensus is final regarding its name and brand.

The Pittsburgh Region has had numerous renaissance movements designed to develop, energize and boost the region’s economy and quality of life. Our next renaissance will happen if we diversify our workforce to increase the quantity and quality of labor available to assume current and future employment opportunities.

The Initiative was developed to address this gap in our region, and work closely with the corporate, government, nonprofit, education, labor and foundation communities to ensure success. The themes that define our work are Prepare (our region and its workers), Attract, Retain and Elevate (a talented workforce), and Promote (the culture here in SW PA) and Thrive when we’re successful. An initial collaborative effort of The Initiative is working with our region’s energy companies to hire a Diversity in Energy Program Manager to further diversify the new employee base that each participating company requires.

The vision of The Initiative is to have the Pittsburgh Region be recognized as one of the most livable regions for a talented workforce of all backgrounds, and among the leading regions in educating, elevating, retaining and attracting a diverse workforce. The Initiative’s mission is to spearhead the next Pittsburgh renaissance - a "People Renaissance" that:

1. Embraces inclusion;

2. Ensures our region's growth by preparing, elevating, retaining and attracting a diverse workforce; and

3. Promotes Pittsburgh - nationally and internationally - as a diverse, welcoming region of opportunities.

The Initiative is seeking a dynamic and bold Chief Executive Officer (CEO) to further build the vision, and lead the organization moving forward. Our region must continue to be more proactive and inclusive in our approach to inclusivity, and leverage and collaborate with existing regional efforts.

The job description should help make clear the strong concern about regional workforce development in terms of meeting the growing talent demands in the energy sector. Generically, I'd characterize this initiative as an economic development program similar to the CEOs for Cities Talent Dividend campaign. But given the expressed energy focus, I'm confident that the primary goal is to address expected labor shortages.