Project Delays from Supply Chain and Management Failures

Definition

Nearly 50% of generation and transmission project delays occur during the construction phase, caused by (1) supply chain bottlenecks for critical equipment (transformers, switchgear, cables), (2) lack of prioritization and project management by transmission owners, and (3) delays by interconnection customers who lack necessary power purchase agreements or construction permits. For a utility's operations director, this means inability to bring planned generation online to meet demand, forcing reliance on expensive spot market purchases or blackout risk. For CFOs, it means project cost overruns (typical inflation: 8-12% annually), extended financing costs, and delayed revenue recognition. Major equipment suppliers have multi-year backlogs, forcing utilities to pre-order years in advance and accept long lead times. Equipment shortage is particularly acute for transformers, which have global supply constraints and 18-24 month lead times.

Why This Matters

Project management SaaS with supply chain integration, construction schedule optimization software, equipment procurement marketplace/platform, supply chain risk analytics, specialized construction management consulting for utilities

Affected Stakeholders

General Manager / Operations Director, Chief Financial Officer / Finance Manager

Related Business Risks