Power plants as megaprojects: Using empirics to shape policy, planning, and construction management. (October 2015)

• Record Type: Journal Article
• Authors: Brookes, Naomi J.; Locatelli, Giorgio
• Is Part Of: Utilities policy. Volume 36(2016)
• Page Start: 57
• Page End: 66
• Publication Date: 2015-10
• Subjects: Megaprojects -- Power plant economics -- Capital intensive -- Project management -- Construction management -- Budget -- Schedule; Public utilities -- United States -- Periodicals; Public utilities -- Government policy -- United States -- Periodicals; 363.6
• DOI: 10.1016/j.jup.2015.09.005
• Languages: English
• ISSNs: 0957-1787

Abstract

Abstract: Megaprojects are historically associated with poor delivery, both in terms of schedule and cost performance. Empirical research is required to determine which characteristics of megaprojects affect schedule and cost performance. Capital-intensive power plants can be understood as megaprojects and time delays and cost escalation during the construction phase can undermine their overall economic viability. This paper presents a systematic, empirically based methodology that employs the Fisher Exact test to identify the characteristics of power plant megaprojects (PPMs) that correlate with schedule and cost performance. We present the results of applying this methodology to a dataset of 12 PPMs using nuclear, coal, and renewable resources as case studies. The results highlight the importance of modular technologies, project governance, and external stakeholder involvement. Key findings both support and contradict the literature. The paper provides two major original contributions. First, we present and apply a systematic, empirical and statistical approach to understanding PPMs planning and construction. Second, we show how this approach can be used to inform public policy and project management with regard to PPMs. Highlights: Megaprojects are extremely large-scale investment projects. The construction of several power plant types is achieved through megaprojects. For opaque reasons megaprojects are often delivered over budget and late. This paper provides a methodology to understand the reasons of project performance. It presents the application and result with respect to 12 European power plants.