getting it right – helping you to deliver capital projects · project management insufficiently...

Getting it right – helping you to delivercapital projects

www.pwc.com/utilities

PwC power & utilities capability statementCapital projects and infrastructure

Introduction 3

Power project pressures and challenges 4

Big demand for power infrastructure… 4

…big project challenges for owners and contractors 5

PwC – helping you get it right 6

Worldwide reach and experience 6

At a glance – why PwC 6

In conversation: The choppy waters of offshore wind projects 8

Practical advice and support 10

Avoiding surprises – getting the right risk management in place 10

Safeguarding success – strengthening project management and governance 12

Always ready – being your strategic delivery partner 14

Getting the project funded – overcoming obstacles 16

Contacts 18

Contents

Your capacity,our capability…

…doing greatwork togetherWith PwC you get an adviser with adedicated capital projects andinfrastructure team and extensiveexperience of big power projects.Whether it’s engineers, commerciallawyers, finance and regulatory expertsor project managers, we’ve got themulti-disciplinary skills to quicklyassemble a team that will give you thesupport you need.

2 PwC power & utilities capability statement Capital projects and infrastructure

Introduction

There’s so much to get right on a big capital project – the right partner and contractor selection, the right governance and control frameworks, the rightfinancing, the right handover and a whole lot more. And with the currentvolume of the project pipeline in the power and utilities sector forecast to riseas future investments come on stream, owners and contractors alike faceincreased pressure to deliver on time and on budget.

Teaming up with PwC gives you theadvantage of bringing on boardpeople with extensive power sectorexperience, a wide range of skillsetsand a special focus on capitalprojects and infrastructure. We havea team dedicated to capital projects.Whether it’s engineers, commerciallawyers, finance and regulatoryexperts or project managers, we have people with the insight andexperience you need.

We have extensive real-lifeexperience, from windpower to gaspipelines to transmission, inside thepower sector. And we’re able to blend that with experience from bigcapital projects in other sectors.

Add to that a pan-European andglobal reach and you can see thatwe’re able to mobilise teams torespond to your project needsquickly in whatever location youneed them.

European power utility companiesare facing investment challenges to transform their current businessstrategies. Renewables projects,renewing infrastructures,decommissioning of power plants and high investments intransmission. Complex projects with high capital investments. With the expertise we have in eachcountry we’re able to advise you whatever, the location.

This statement of our capabilities shows the range of our experienceand expertise. We can give youpractical advice and support to helpget projects funded, safeguard yourprogress, avoid surprises and be astrategic partner on your project.

Our starting point is matching your needs with our capital projectand infrastructure expertise,knowledge, professional objectivityand rigour. We believe in having acontinuing dialogue – listening toyour priorities, understanding your issues and delivering greatprojects together.

PwC power & utilities capability statement Capital projects and infrastructure 3

Norbert SchwietersGlobal Power & Utilities Leader

Martin BorkPower & Utilities Capital Projects & Infrastructure Leader, Europe


Demand for electricity is set togrow more than any other finalform of energy in the next twentyyears. Under current policies,global demand is set to nearlydouble between 2011 and 2035.And growth isn’t just comingfrom fast-growing and emergingeconomies. In Europe, electricitydemand is forecast to increase by around more than a quarterover the same period.1

Big demand for powerinfrastructure…

This increase in demand comes on top ofthe energy infrastructure changes needed torespond to the demand for cleaner energy,to strengthen energy supply and security, to introduce smarter technology and gridsand renew or replace ageing assets.

In different countries and in different ways, an energy transformation is takingplace. And whether it is replacement ofageing assets or expansion into newrenewable sources of power, this energytransformation brings with it a majorinvestment and capital programmechallenge. Cumulative global investment in the power sector is projected at US$17 trillion over 2013–2035, averagingUS$740bn per year. New plants account for 58% of the total, while the rest is needed in transmission and distributionnetworks.2

Again, it’s not just in the fast-growthmarkets. The combination of ageing assets and adoption of ‘new policies’ on the energy mix means the European Union has the greatest volume of capacityretirements and, apart from China, alsothe greatest amount of capacity additionscompared with any other region in theworld.3 In association with OxfordEconomics, PwC has conducted its ownanalysis of the level of powerinfrastructure investment expected until 2020. The results for a selection of European countries are highlighted in figure 1.

Poland

Power generation US$28.7bnTransmission US$19.9bn

Germany


Netherlands


France


Turkey


Figure 1: Forecast 2020 power sector investment in selected European countries

1 World Energy Outlook 2013, International 2 Energy Agency, current policies scenario.2 Ibid.3 Ibid., new policies scenario.

Source: From background data gathered for PwC and Oxford Economics, Capital project and infrastructure spending Outlook to 2025, 2014.

Power project pressures and challenges


Our experience shows that threeout of four projects don’t meettheir quality, time or costobjectives. By their nature,capital projects are not part ofday-to-day operations.

…big project challengesfor owners andcontractors

It’s not unusual for project teams to have to manage the biggest capex programmethey’ve ever undertaken. Often companieshave to rebuild know-how and resources.In sectors such as nuclear power, a wholegeneration of experience may have beenmissed because of a hiatus in projects.

Sound project definition and effectivedecision making at the outset andthroughout a capital project are critical toa successful outcome. It’s obvious andmost entities involved in a project knowthat. But still outcomes go wrong. Many ofthe causes come down to people-centredissues. There are plenty of books on projectmanagement. The science of projectmanagement is well known. But the wayin which it’s delivered, the people and the cultural aspects, are often what posesthe challenge.

Some of the root causes of projects going wrong include:

LeadershipA lack of leadership visibility and decisionmaking, poor communication and priority-setting, over-confidence, lateescalation and acceleration, unclearstakeholder management, structures,processes and responsibilities.

Project managementInsufficiently robust risk management,weak project progress checking andforecasting, lack of commercialmanagement, late and reactiveproject reporting.

ResourcesLack of resources, missing experience and capabilities, high turnover of keyresources, poor staffing and training,insufficient empowerment.

Scope managementIll-disciplined design freeze andcontinuous changes in design,underestimation of the complexity of new technology, missing interfacemanagement, lack of documentation, poor claim, change and variation order management.

PlanningLack of readiness at project start, losingtime and performance due to slow or lateramp-up of project, compromised budgetfrom decision making around the finalinvestment decision (FID), compromisedprice during negotiations/contracting,tight and unrealistic schedules, insufficientrisk mitigation planning and not enoughforward-looking strategy.

“Cumulative global investment in the power sector is projected at US$17 trillion over 2013–2035, averaging US$740bn per year.”

Figure 2: How PwC can help

Safeguardingsuccess

Getting theproject funded

Avoidingsurprises

Deliverypartner

Practicaladvice and

support


Our Capital Projects & Infrastructure (CP&I) practicesupports our clients throughout the initiation and executionof large-scale projects. PwC has a dedicated internationalpractice supporting investors and contractors. Our focus ison delivering value from capital projects for you, our client.

Power plants, offshore wind farms,construction projects, transmission lines,hot rolling mills, steel plants, airports, rail systems, solar power plants, oil and gas exploration, aviation and spaceprogrammes.

At a glance – why PwC

A strong power sector capital projectfocus• Our team has strength and depth in all

aspects of the power sector.• We have knowledge and experience

that includes large-scale thermal or nuclear generation plant, onshore and offshore windpower, electricity and gas transmission networks.

Multidisciplinary teams• Lasting value for our clients, bringing

together the right mix of skills.• Combining the creative mindset and

problem-solving experience of our specialists from financial (funding, tax and accounting), technical (IT, mechanical and civil engineering, physicists) and commercial disciplines (business, management), with the precision, structure and analytical capabilities of the power market.

Global network to assist with futurechallenges• Strong global network to help our

clients succeed.• A great workforce with broad

capabilities and a deep commitment to our power sector clients. This investment positions us to anticipate our clients’ needs and respond with a quality of service that sets us apart.

Influential and committed professionals• Key contacts in government

organisations and understanding of regulatory frameworks.

• Hands-on approach to developing your organisation and supporting its capabilities.

We provide support in setting and implementing your goalsIntroducing governance frameworks and tailoring your organisation and processes to deliver a strategy-achieving environment. Providing oversight and avoiding surprises.

We improve your project delivery performanceSupporting and improving delivery performanceand capabilities of the project managementorganisation for contractors’ core businesses andinvestors/operators’ new-build organisations.

We ensure that your project goals are achievedSupporting, improving or recovering individualcapital projects or programmes, cost reduction,strategic delivery partner, acceleration, disputesupport, due diligence for transactions &banks/investors.

Figure 3: Service offering CP&I

Worldwide reach and experiencePwC – helping you get it right

Strategy, governance andstructure for capital projects

and portfolios

Operational project management excellence,

capabilities and tools

Supporting individual capital project performance


Working with investors:nuclear construction monitoringWe reviewed the management,progress and out-turn forecast of anuclear reprocessing facility inEngland on behalf of a group ofinternational customers.

Our work involved visits every sixmonths to the site to review progressin the design, engineering, budgetaryand accounting functions.

We also reviewed the status of theconstruction work and changes tothe project, providing comfort to the client by carrying out interviewswith key management, assessing andreviewing costs and procedures andreporting to the client on the statusof the work and most likely outturncost and ‘go-live’ dates.


Martin Bork: “Our team has been involvedwith more than 20 major projects in theoffshore wind industry. You get a goodoverview of the project risks and causes ofdifficulties. A key difficulty for contractorscomes from the offshore foundationstructures and the pressure from operatorsand investors for lowest cost uniformproduction. But the reality is that everyoffshore location has its own peculiaritiesand there are differences in water depthand soil characteristics which need to bereflected in different foundationstructures.”

Rebekka Berbner: “These things need to be made explicit up front, recognising theneeds of the different parties. We adviseboth wind farm operators and investors aswell as contractors to help them minimisetheir risks and improve their performance.We provide support during the planningphase and in the quoting process, but alsoduring the entire project implementation.”

Martin Bork: “The reality so far is thatthey’re not always addressed up front,leaving them to be dealt with during theproject. If that’s the case it’s essential that’s done quickly, transparently andobjectively. We’ve recently completed aproject review for a turbine manufacturerwhich addressed the issue of foundationstructures. But we also understand theneeds of investors. For the funders, wehave also conducted a project review andoutlined the improvement measures thatare needed.”

Martin Bork: “I don’t know of a singleproject which was completed withoutmassive additional costs and time delay.You can see the types of problems that areencountered in figure 4. We’ve seeninvestors, operators and contractors in theNorth Sea and the Baltic Sea facingimmense pressures. It’s important to lookat ways of avoiding these difficulties.”

Rebekka Berbner: “There’s a danger thatthe situation will persist, especially withthe added pressures that come from theambitious 2020 goal of a 35% share ofEurope’s electricity generation fromrenewables.”

Martin Bork: “Lessons are being learnt.We’ve got to remember all this is new, withenormous engineering and constructionchallenges. It’s been a fledgling industrywhich has introduced new technologiesand built up and developed existing supplychains. But, given the problems that havebeen encountered, it’s essential thatlearning translates into changes inapproach. Otherwise many projectscurrently in the planning and constructionphase could face an uncertain future.”

Rebekka Berbner: “One of the big areas for improvement is the interface betweenthe different parties involved. Often theseinterfaces don’t mesh properly, leading tocost overruns and complex disputesbetween project partners. In some cases,these have the potential to threaten thewhole project.”

4 European Wind Energy Association.

Europe’s offshore wind capacity is enormous. Already it has more than 90% of the world’sinstalled capacity and this is setto increase eightfold – to 40GWby 2020 from 5GW in 2012.2

But delays and cost overrunshave blown many projects offcourse. PwC’s Martin Borkand Rebekka Berbner discuss the difficulties.

In conversation: The choppy waters ofoffshore wind projects

Poorcontracting

Unexpectedpermittingrequirements

Unrealistic schedules

Missing supplier integration

Inadequate project organisation

Weak claimmanagement

Insufficient riskmanagement

Poor project control(costs, quality, schedule)

Impreciseplanning and

projectcalculations

Missingalignment ofrequiredcompetencies

Figure 4: Challenges in offshore wind projects

Project initiation

Planning and permitting phase

Construction andinstallation phase

Inve

stm

ent

Project phases (t)


…PwC is able to deploy teams with significant‘on-the-ground experience’ of mega projects. This comes either directly from previousemployment in construction managementfunctions with large multinational EPC(engineering, procurement and construction)firms, or from assessing, designing andoperating ‘mega project’ controls throughconsulting experience. We have the people with the knowledge and the experience.

People with on-the-groundexperience…


The risk of surprises in any capital project is substantial.Many companies say they build in risk management from the start. Most know what the potential showstoppers are.Many will also have drilled down to identify the smallerproblems that could easily escalate and quickly becomebigger. But the reality is that they often don’t match theattention they give to risk identification with the attentionthat’s needed to act on it.

The need for effective risk management inthe power sector is all the greater given themarket and regulatory context. Projectsmay have fixed regulated returns with costoverruns not easily recoverable under theprice regime. Similarly, projects exposed tomarket pricing may find market conditionsconstrain the ability to recover overrunsthrough revenue. This context increasesthe need for more robust and integratedrisk management during project executioncompared to the ‘classic’ project riskmanagement focus on budget, time andquality only.

How PwC can help

Establishing the right governanceframeworkRisk management is only as good as therisk and control mechanisms you set up.Combining our engineering, projectmanagement, regulatory, financing,accounting, legal and consultingexperience, PwC can help you establish the right frameworks to manage contractsand requirements, identify issues and risks, establish timely risk mitigation plansand escalate issues when managementattention is required.

Selecting the right tools Providing proven processes, tools andtemplates to plan and deliver capitalprojects. We can help you select from acomprehensive suite of control tools andprocedures to address detailed planningand scheduling, active changemanagement, cost controls, riskmanagement, quality controls, safetymanagement contract administration andregulatory compliance. You will also wantto establish detailed control analytics thatregularly analyse performance parametersand report timely, relevant and accuratemetrics to senior management and projectstakeholders.

Avoiding surprises is not just aboutidentifying and reporting the risks butknowing how you are going to measurethem and judge when they becomematerial. And then, crucially, you’ve got to know how you can mitigate them. The value is in actually mitigating andtracking the risks once identified toshrink them and try and ensure thatthey don’t impact on your performance.Transparency and clear processes in this area can prevent a great deal ofdisputes, costs and delays.

Avoiding surprises – getting the rightrisk management in place

Practical advice and support

Typical risk management issues

• Risk management is nominally in place but lacks substance and is ineffective.

• People get defensive and don’t share problems across teams or upwards with top management.

• Risk definition is too generalised, lacking tangible, objective measures.

• Inadequate assessment of the likelihood and impact of risks.• Contingencies not adapted to levels of risk.• Trigger points that would give a sense of urgency are not

identified.• Managers fail to understand the knock-on effects beyond

their component of the project.• Clear mitigation plans not in place.

At a glance


Additional oversight expertise Deploying experienced capital projectprofessionals to support critical projectoversight functions. With PwC, you gainthe reassurance of an expert outsideeye, offering support and challenge whenneeded, enabling you to identify andcorrect oversights and make changes intime to keep your project on course andminimise disruption.

Deciding on the best procurementstrategy It’s important to match the procurementand contracting strategy to the balance ofrisks. No two capital projects are alike orhave precisely the same set of objectives,issues and constraints. We can help youmodel the suitability of differentapproaches and make sure the projectcontracting approach and commercialterms balance risks and rewards amongproject participants and clearly establishaccountability for specific performanceparameters.

Working together – PwC and a leadingEuropean utility company ContextIn a review of a major capital project, itbecame apparent to a leading Europeanenergy utility company that its riskmanagement approach was focused on rather qualitative descriptions offindings and not enough on quantifiedrisk evaluations. PwC was asked toconduct a risk assessment of the projectwith the project team. The objective was to gain a sound assessment of theproject risk situation and definepragmatic mitigation strategies basedon industry best practices.

OutcomeThe risk assessment gave the utilitycompany a much more secureevaluation of the risk in the project. The benchmarking provided someassurance as much of the project set-up and performance compared with industry best practice. Someimprovements in selected areas such as risk management and claimsmanagement were identified for action.

What we didThe PwC team began by compiling a holistic assessment of the risks in the project. Current risks were re-evaluated on a firmer basis and thepotential of future risks during theremainder of the project duration wasassessed. Using these insights, the teamconducted a benchmarking of thecommercial project management areasagainst industry best practice to locateand identify improvement areas.Mitigation strategies were thendetermined and ad hoc support wasprovided to the project team.


Success is at its most tangible when the champagne corks popat the completion of a project. But it will only happen if it’shard-wired into the project from the outset in the form ofstrong project management and governance. Indeed, reallysuccessful project management comes when organisationslearn the lessons of earlier projects and build them into thenecessary organisational changes ahead of the next one.

Making sure commercial and technicalteams are talking to each other and that operational and maintenanceconsiderations are incorporated early into capital project planning will help you stay on top of things.

While it’s never too late to make changes,they are best done sooner rather thanlater. There is a key tipping point whereyou start locking in your options for howthe project is going to turn out. The earlyphases of a project are ‘value-creating’.Once the ‘point of no return’ is passed, theimplementation and delivery phases are,hopefully, ‘value-retaining’. But, if thingsgo wrong, they can be ‘value-destroying’.Getting project management andgovernance right from the start is one ofthe key success factors for projects.

How PwC can help

Assessing your organisational readiness Determining your organisational readinessto achieve project goals, identifyingrisks and defining mitigation strategies.We can help you take a realistic and hard-nosed look at all the things that arerequired to deliver your capital project,identifying and addressing any gaps. It might be people gaps, process failures or insufficient attention to the amount of integration required.

Delivering change when needed We can help you make the organisationalchanges needed to ensure you are ‘capitalproject ready’ or determine if you need tomake changes in the middle of the project. We help large energy organisations designand implement major change programmes that improve performance, buildcapabilities, and strengthen behaviour over time. Our support gives you theguidance and the push to driveorganisational change—such as movingfrom good to great performance, cuttingcosts, or turning around a crisis.

Our experience from more than 150capital project engagements in a typicalthree-year period means we understandthe root causes of failed projects. We canuse that understanding to flow into yourproject organisation so that it is set up inthe best way to safeguard your projects.

A holistic structure with interfacingprocess and roles and responsibilities is akey element in project success. If things gowrong, you don’t want any disconnects.Most importantly, integration helpsprevent things going wrong in the firstplace.

Safeguarding success – strengtheningproject management and governance


Typical project management andgovernance issues

• Absence of developed and robust project management processes.• Starting contracting and procurement prior to final

investment decision (FID).• Insufficient integration among project teams, particularly

between commercial and technical functions.• Financial and commercial input framed in narrow

accountancy or administrative terms and not delivering full potential value-add to the project.

• Inadequate tracking and visibility of progress.• Time pressures and late requirement definitions causing design

changes and shunting unfinished work to the next phases.• Technology change occurring during projects. • Experts and specialists spread too thinly across programmes.• Lack of people with sufficient project management and

leadership experience to provide pro-active project management thinking.

At a glance


Bringing operational excellence to yourproject management By applying our operational excellencepractice to your organisation, we can helpyou strengthen crucial elements of yourapproach to project management based on best practice organisation and processframeworks. Our operational excellenceframework for capital projects covers thekey things that are important for yourproject – governance, organisation,processes, people, tools and systems (see figure 5).

Keeping projects on or ahead of courseWe can support you through theconsistent application of leadingpractices to keep projects on course,improving project management decision-making and guiding projectdecisions. We can help you put in placebudgeting and forecasting processes,project cost and schedule systems,reporting procedures, contract controland project audit processes plus all theother things needed for project success.

Assurance and monitoringWe can provide you with reviews of project controls and processes, reviews ofprogramme management, due diligence on programmes and projects, as well aspost-project close-out and review oflessons learnt.

Working together – managing multiplecapital projectsContextOur client was a market-leadingmanufacturer of offshore wind projectfoundation and substations. The boomin projects had left the companystretched and lacking the organisationaland procedural structures to manageprojects cost-efficiently. This wasfeeding through into a massive negativeimpact on the net profit margin. Outcome

Core processes were transformed to ensurethat engineering and construction projectscould be delivered on cost, on time and to the quality promised to the client. We conducted around sixty training andworkshop sessions to support employees in this major change as well as providingcoaching for individual members of staff.

What we didPwC was appointed to reorganise the company from a pure linemanufacturer to a matrix projectmanagement organisation. A PwCteam of engineering and commercialexperts evaluated the challenges in alldepartments and processes in order todetermine ways in which projectscould flow smoothly from the proposalphase to the project execution phase.The organisational structure and rolesand responsibilities of core functionswere redefined. A new steering andcontrolling process was designed toprovide a focus on transparency andcost efficiency. Supporting tools andtemplates were also provided to theclient to increase project efficiency.

Governance Organisation(s) Processes People Tools and systems

Figure 5: PwC CP&I operational excellence framework for capital project management

Stage gate model

Project classification

Organisationalstructure

Roles andresponsibilities

Core PM processes

Supporting PMprocesses

Capabilities

Experience

Standardisation

KPI performancereporting


With PwC at your side as a strategic delivery partner, you’realways ready and never on your own. We’re there to keep youone step ahead, drawing on our experience from manydifferent capital project situations. We can help you chartyour course and prevent problems arising along the way.With our multidisciplinary team, we can boost your team’scapacity at times when you need it, as well as being a trustedadviser.

There are lots of reasons for involving us in a strategic delivery role. You might havesubstantial capital project experience in-house but are seeking a better deliverytrack record. You might be like many in the power sector and be facing a wave ofprojects for the first time in a generation,with the need to regain experience thathas been lost. Either way, a strategicdelivery partner can substantially boostyour capability and strengthen your handin contractor relationships as well.

The strategic delivery role can also be avital help when projects are in the publicand political spotlight. By their verynature, power projects are often at thecentre of controversial planning debates or regulatory scrutiny. We can provide theindependent evaluation and assurancetools that can help you navigate theinevitable challenges that arise.

How PwC can help

Providing you with expert oversight Our scale and global reach mean we’ve got people with the experience to put yourproject governance and management onthe best possible footing. We can identifythe things that are going to maximise thechances of your project performing to planand give you cost-effective answers to thevarious project management questionsyou’ll face.

A more cost-effective approach With PwC involved at the start, you are making a cost-effective investment. The ability to influence project success and enhance value is greatest at the start of project evaluation and rapidlydeclines as a project advances towardsimplementation. Conversely, the cost ofchange dramatically increases throughouteach successive project stage. The qualityof decision making in the early stages istherefore a critical factor in projectsuccess.

The right tools to make key decisions We’re by your side at all the key projectstages to provide timely support and giveyou the tools with which to make the right decisions. For example, we providefinancial modelling, valuations andbusiness case calculations at the appraisalstage, advice on the best procurementstrategy to follow, and help with thecontracting strategy itself, includingvendor qualification, tender evaluationand negotiation support. And we’re onhand to establish your projectmanagement structure, processes, toolsand staffing.

Keeping things movingDuring the delivery phase, we can help youkeep on track with support on scheduling,construction management, progressmeasurement and reporting as well as riskand opportunity management. If problemsarise, we can recover matters with statusreviews, schedule slippage analysis,improvement measures and otherinterventions. We can help preventdisputes but, if you do have to go intodispute with a contractor, we can assistwith resolution and settlement.

Always ready – being your strategicdelivery partner



Working together – PwC as yourstrategic delivery partnerAs your strategic delivery partner, wecan help make the right things happenat the right time. We have theexperience and capability to provideindependent challenge when neededand the depth and breadth of resourcesto augment your organisation’sresources at any stage.

The major benefits for a client areachieved when we get involved earlyand at a strategic level. We helpimprove the certainty of a successfuloutcome with the full weight of PwC’sglobal capabilities, experience andresources. We act as a partner to ensure major capital projects andinfrastructure programmes areplanned, scoped, procured anddelivered to the required time, costand quality parameters.


Despite an improvement in the investment climate, access tofunds can be a challenge for some power and utility projects,especially in sectors such as offshore wind generation, wherethe construction and engineering risks are considerable andthe linked infrastructure need is significant. And even withprojects where funding is less constrained, project ownershave to navigate a maze of funding choices.

How PwC can help

We have a strong track record instructuring the funding for large-scaleinfrastructure projects and are able tocover both debt as well as equity.

We advise on identifying the actual funding need, finding the right investors,structuring the deal according to therelevant requirements and negotiatingterms and conditions in favour of ourclients.

Our involvement helps to create trust inthe transaction and facilitates access tofunding routes that otherwise might havebeen closed.

We offer comprehensive financial advisoryservices, helping you choose between debtor equity funding and providing theexperience to support you along bothroutes.

A range of funders have an appetite forinvesting in power infrastructure –traditional financial sources as well asincreased involvement from pension funds,insurance companies, private equity andsovereign wealth funds. The challenge ismatching the right funds to the rightproject, making sure financing isstructured in ways that meet both theproject characteristics and the specificrequirements of the funds available.

We have the expertise, broad experienceand an extensive network to assist instructuring the funding of complex powerinfrastructure projects. We can ensure allrelevant funding issues are raised andaddressed in time, efficiently andprofessionally, avoiding the risk of nothaving the right funding in place orsuffering from a poor funding structure.

Getting the project funded –overcoming obstacles


Figure 6: Project sponsors and project finance investors face a number of complex challenges

Fundingcompetition

Financialmodel

Privateplacement

Hybridsolution

Public bond

Bank debt

Equity

Multi-laterals

Financialengineering

Tenor

Margins

Gearing

Coverratios

Rating

Fees


Working together – PwC and sell-sidefinancial advice for an offshore windenergy pipeline in the German North Sea

Project goals• Analysing the deal and working out

the key requirements with regard to potential investors.

• Identifying potential investors and working out a strategy for approaching them.

• Contacting selected investors and introducing them to the project.

• Organising and running negotiations.• Supporting contractual close.

Key issues to be considered• A big offshore pipeline with a

comparatively long lead time to realisation.

• Optimisation of our client’s position with regard to future involvement in further project development.

• Optimisation with regard to the risk/return profile, e.g. regarding payment structure.

Contacts

Global contacts

Norbert SchwietersGlobal Power & Utilities LeaderTelephone: +49 211 981 2153Email: [email protected]

Jeroen van HoofGlobal Power & Utilities Assurance LeaderTelephone: +31 88 792 14 07Email: [email protected]

David EtheridgeGlobal Power & Utilities Advisory LeaderTelephone: +1 925 519 2605Email: [email protected]

Olesya HatopGlobal Power & Utilities MarketingTelephone: +49 211 981 4602Email: [email protected]

Subject matter experts

Capital Projects & Infrastructure

Martin BorkTelephone: +49 211 981 7288Email: [email protected]

Rebekka Berbner Telephone: +49 211 981 1414Email: [email protected]

Territory contacts

Europe

AustriaMichael SponringTelephone: +43 1 501 88 2935Email: [email protected]

BelgiumKoen HensTelephone: +32 2 710 7228Email: [email protected]

Central and eastern EuropeAdam OsztovitsTelephone: +36 14619585Email: [email protected]

DenmarkPer TimmermannTelephone: +45 39 45 91 45Email: [email protected]

FinlandMauri HätönenTelephone: +358 9 2280 1946Email: [email protected]

France Pascale JeanTelephone: +33 1 5657 1159Email: [email protected]

GermanyNorbert SchwietersTelephone: +49 211 981 2153Email: [email protected]

GreeceVangellis MarkopoulosTelephone: +30 210 6874035Email: [email protected]



IrelandAnn O’ConnellTelephone: +353 1 792 8512Email: [email protected]

IsraelEitan GlazerTelephone: +972 3 7954 830Email: [email protected]

ItalyGiovanni PoggioTelephone: +39 06 570252588Email: [email protected]

NetherlandsJeroen van HoofTelephone: +31 88 792 1328Email: [email protected]

NorwayHildegunn Naas-BibowTelephone: +47 95 26 01 18Email: [email protected]

PolandPiotr LubaTelephone: +48227464679Email: [email protected]

PortugalJoao RamosTelephone: +351 213 599 296Email: [email protected]

RussiaTatiana SirotinskayaTelephone: +7 495 967 6318Email: [email protected]

SpainCarlos Fernandez LandaTelephone: +34 915 684 839Email: [email protected]

SwedenAnna ElmfeldtTelephone: +46 10 2124136Email: [email protected]

SwitzerlandMarc SchmidliTelephone: +41 58 792 15 64Email: [email protected]

TurkeyMurat ColakogluTelephone: +90 212 326 64 34Email: [email protected]

United KingdomSteven JenningsTelephone: +44 20 7212 1449Email: [email protected]

PwC helps organisations and individuals create the value they’relooking for. We’re a network of firms in 157 countries with morethan 195,000 people who are committed to delivering quality inassurance, tax and advisory services.

The Global Energy, Utilities and Mining group is the professionalservices leader in the international energy, utilities and miningcommunity, advising clients through a global network of fullydedicated specialists.

For further information, please visit:www.pwc.com/utilities

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