A lack of project talent played a significant role in Eskom missing critical
milestones in two current coal-fired power station projects in South Africa, for
example. The plants were supposed to be fully commissioned in 2017, but the
company announced in April that the combined 9,000-megawatt plants won’t
be fully operational until 2021.
“We didn’t do enough risk assessment or stress-test the tasks on the critical
path” to know that a lack of specialized talent would inevitably lead to cost overruns and poor stakeholder management. “We got burned because we weren’t
honest with ourselves from the start,” he adds.
One common solution is to bring in industry veterans from other countries to
manage the local teams. But that can spark its own set of language and cultural
From climate change to technological breakthroughs, the
global energy industry is contending with a potent combination of disruptive trends.
But in emerging markets,
project leaders are focused
squarely on the basics.
In light of urbanization and
industrialization, the over-riding priority in emerging
markets is to provide reliable
power to a large population,
says Philipp Gerbert, senior
partner and managing director, Boston Consulting Group,
Here’s a look at the power
project landscape in emerging
With more than 80 percent of homes electrified, South Africa
is one of the continent’s most developed countries in terms of
power accessibility, Mr. Gerbert says. “The big issue now is the
increasing demand for generation, with the economy taking
strain with periodic load shedding.”
President Jacob Zuma has set ambitious goals to increase
capacity, but some project sponsors complain about a lack of
infrastructure connecting private power generation plants to the
national grid. The country will need to ramp up investment in its
power distribution network while also encouraging more private
power plant projects. Some of that growth should be coming
from renewables. IHS Global Insights ranked South Africa the
most attractive emerging country for solar energy in a 2014
report, pointing to plenty of project potential.
Most other African countries struggle with a lack of investment in reliable energy service, Mr. Gerbert says. For power
generation project sponsors, the biggest obstacle is whether
governments will establish fair pricing and build out the necessary distribution networks.
Comprising more than 18,000
islands, the country faces geographic obstacles to building
extensive power networks. Indonesia has a low accessibility
rate, and generation capacity
growth isn’t keeping up with
demand, according to the U.S.
Energy Information Administration (EIA).
“They own a lot of gas, but
they don’t have the networks in
place to take full advantage of
it,” Mr. Gerbert says.
As the government tries to
stimulate foreign investment
in the sector, look for it to
sponsor a growing number of
Access Above All
Clean energy is nice, but meeting rising demand remains the paramount goal for most emerging markets.
The Kusile Power Station, at left, in South Africa’s
Mpumalanga province and the Medupi Power
Station in the country’s Limpopo province