Risk management in the renewable energy sector

Climate change has kick-started the drive to increase renewable energy across the world. According to a recent International Energy Agency (IEA) report1, renewable energy capacity grew 50% faster in 2023 than the previous year. Looking ahead, the IEA forecasts that renewables will supply more than 42% of global electricity generation by 2028. Europe, the USA and India are set to more than double their capacity in the next 5 years, with China increasing by a factor of 3.

However, there are significant risks to achieving this forecast, including supply chain uncertainty, escalating costs, shortage of skilled labour, raw materials availability, access to finance, and geo-political instability. Add to this the perennial problem of delivering major projects on-time and on-budget, where issues include delays to planning approvals and grid connection. The saying “time is money” is as true as ever: every year the world delays tackling climate change, the costs (which goes beyond £ and $) mount higher and higher. The focus on managing the risks and finding opportunities for technological innovation has never been more important.

Recognising the challenges, renewable energy companies Corio and Inchcape have risen to the challenge and turned to Predict! to help them manage risk across their current and ongoing portfolio of projects, in order to deliver against strategic business case objectives.

According to Alex Ward-Gittos, Head of PMO at Corio Generation “Our business requires comprehensive risk management across our portfolio of offshore windfarm projects.” He goes on to say; “The easy to use Predict! software allows us to understand and manage risks and actions across all our projects and at an enterprise-wide level. The integrated quantitative cost and schedule analysis capability allows us to gain vital understanding of our cost and delivery confidence. The interactive dashboard also enables us to have insightful conversations with stakeholders to agree the most effective mitigation strategies.”

Sound risk management is vital to any organisation looking to build its renewables portfolio. Thankfully, finance for renewables is currently seeing a boost, with the USA Inflation Reduction Act, EU policy incentives supporting decarbonisation and energy security targets, and India implementing progressive policy improvements to remedy auction participation, financing and distributed solar PV challenges.  So the opportunity is there and as long as the risks are carefully managed, we have hopes of seeing a brighter future.

Further information about how Predict! is an integral part of Corio’s digital transformation strategy can be found in this article from CPO Strategy magazine.

Trevor Jay, Technical Sales Manager Risk Decisions

Further reading:

1IEA Renewables 2023 Electricity Report

Aligning projects and business objectives delivers value

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