How big energy projects get done - cost and schedule

A new book looks at why big projects fail and finds that solar, wind and transmission lines are some of the best kinds of big projects, while nuclear power is among the worst.

In the late 1980s, Denmark’s government announced plans for a massive bridge and tunnel project, the largest infrastructure plan in the history of a country that had little experience building tunnels. Bent Flyvbjerg watched the announcement on the news with his father, who had worked in bridge and tunnel construction.

“Bad idea,” his father said. “If I were digging a hole that big, I would hire someone who had done it before.”

The Great Belt project, as it was called, would go on to face years of delays and the equivalent of billions of dollars in cost overruns. It provided inspiration for Flyvbjerg, now a professor of management at Oxford University, to spend much of his career studying why big projects often go horribly wrong.

This is one of the opening anecdotes in Flyvbjerg’s new book, How Big Things Get Done, written with journalist Dan Gardner. It’s a breezy summary of decades of research into big projects, with a lot to say about the transition to clean energy.

Flyvbjerg’s project database includes just about every kind of power plant and related infrastructure. He found that solar power projects were the leader—not just among energy projects, but all projects—in terms of avoiding cost overruns. Electricity transmission lines are second best, followed by wind power projects. Fossil fuel power plants also do well in terms of coming in close to their budgets, falling just behind wind power projects.

Meanwhile, he found that nuclear power plants and hydroelectric dams are both prone to going wildly over budget. Nuclear’s lack of modularity is one of the reasons that so many projects turn into financial disasters. Each nuclear plant is its own complicated thing, and because of safety concerns, everything needs to be close to perfect right away.

Hydropower suffers from some of the same problems as nuclear, with each project highly customized and a lack of modularity.

The nuclear projects that he studied had, on average, cost overruns of 120 percent; hydroelectric dams were 75 percent; fossil fuel plants were 16 percent; wind power was 13 percent; transmission lines were 8 percent and solar power was 1 percent.

The figures come from Flyvbjerg’s database of about 16,000 projects in 136 countries over several decades. He only includes projects that are complete, so current megaprojects, like the long overdue Vogtle nuclear plant in Georgia, are not yet part of the mix.

The nuclear industry is focusing on small modular reactors as the potential next generation of nuclear power, with several startups working to develop equipment that they say will be cheaper and safer than existing reactors.

While the idea of mass producing nuclear reactors would seem to be right in line with the lessons of Flyvbjerg’s research, he is skeptical.

“If we could solve the nuclear waste storage problem and get small modular reactors to work, there might be a good future for nuclear, but it’s completely unclear at this stage whether that’s going to happen,” he said.

He looks at the history of nuclear projects facing long delays and cost overruns and thinks it’s reasonable to expect more of the same, at least initially, for the first projects that use small modular reactors. If that happens, then new plants wouldn’t be coming online until the 2030s, which means this technology wouldn’t be contributing at all during this crucial decade for making a rapid transition away from fossil fuels.

Still, there is value for having nuclear as an option when looking at a longer time horizon, like 2050. But he thinks planners need to have their eyes wide open about what they are getting into when they look at costs and timelines for nuclear.

“Nuclear is so difficult, almost like it’s obstinately difficult,” he said.


Thanks for that.

I think the optimistic side of the article needs to be included.

The upshot is that the energy transition is likely going to be financially workable. In a world prone to boondoggles, this isn’t one, at least not so far.

“We’re actually very lucky that the technology that we need in order to decarbonize is the least risky,” he said.