The changing Generator Performance Standards landscape in EPC Contracts

Before I head down the path that winds its way through this post, I acknowledge that this topic is intensely complicated and differs from project to project.  I in no way claim to be a grid connection specialist.  This post only aims to set down some of my observations.  There are a multitude of people more qualified to discuss this, and in more depth.  If you’re one of those people, send me your thoughts.  We are all here to learn.  With my consultant’s disclaimer suitably covered, let’s kick off.

There are two aspects of grid connection works that I typically see in the projects I work on.  The first has to do with the negotiation and approval of the Generator Technical Performance Standards (GTPS) and the other has to do with connection works required to physically connect the facility to the grid.  This post deals with the first item, the GTPS.  I will attempt to tackle the second topic separately, as this is also fraught with interesting complexities.

Generator Technical Performance Standards.

This is a good paper by Dr Julian Eggleston of the Australian Energy Market Commission (AEMC) explaining the GTPS context, why they exist in the Australian electricity market, and how prospective generators go about complying with the requirements.  I’m not even going to pretend that I’m the right person to explain the process.

But in summary, there are three different access standards that are defined by the AEMC.  The paper referenced above provides a good overview of these:

A.      The automatic access standard

The automatic access standard reflects the level of performance required of a connection such that it does not adversely affect power system security or the quality of supply to network users, regardless of the size, technology and location of the connection point.

This means the automatic access standard should be set at a level that is a ‘safe harbour’ for connection applicants, and more importantly, for the power system and other network users. The automatic access standard is the level of performance that would be appropriate in any location of the power system, including under the poorest network conditions (relevant to that technical requirement) that are foreseeable across the power system.

B.       Minimum access standard

The minimum access standard reflects the lowest level of performance required of a connection such that it does not adversely affect power system security or the quality of supply to network users, taking into consideration the size, technology and location of the connection.

In practice, this means considering the lowest level of performance that may be acceptable for a connection to do no harm in the best network conditions (relevant to that technical requirement) that are currently seen across the power system. This is the key distinguishing factor between the automatic and minimum access standards.

As the access standards should reflect local power system conditions, it may be appropriate to set a minimum access standard for some technical requirements at no capability. However, for other requirements such as fault ride through capability, the access standards should set the minimum level of performance that is acceptable when connecting to the power system.

C.       Negotiated access standard

A negotiated access standard represents the point agreed by all parties to the negotiating process within the range provided by the automatic and the minimum access standard. It is the process that maintains system security and quality of supply at an efficient cost.

In practice, the projects we’ve seen always have some level of negotiation.  The automatic access standard would be overly expensive to implement and the minimum access standard is likely to not be adequate for the conditions specific to the proposed development. 

Projects that I was working on in 2017/18 placed the responsibility for grid connection modelling on the EPC Contractor.  They had to comply with the GTPS set out in the Connection Agreement, but then also had to do all works required to demonstrate that the facility could meet those standards.  They had to do the modelling, complete all the technical documentation and reporting and they were directly involved with the NSP in closing out any technical issues that were identified.  The Principal had ultimate registration responsibility, but the Contractor had to do most of the work to get the Principal to the finish line and bore the brunt of any changes in the interpretation of rules. Contractors, often new to the Australian market, were then responsible for meeting these standards that may be subject to change, with inverters that had not been tested in the market (and manufacturer models that were sometimes shaky at best.)

The upshot of all of this is that a number of Contractors struggled to demonstrate compliance.  And projects were delayed with an enormous financial impact on these Contractors.   In some cases these delays and associated damages were severe.  So severe that some Contractors have decided to pull out of the Australian renewables market altogether (e.g. Downer,  Biosar) and others have collapsed entirely (RCR Tomlinson.)

In 2018 I started to see some changes filter through in the EPC Contracts.  An example of this is the Contractor being able to rely on the GPS set out in the Connection Agreement.  Any changes required by the Market Operator deemed to be a change of interpretation of the Electricity Market Rules would be considered to be a change of law and the Contractor would be entitled to some sort of relief.  They were still responsible for the GPS modelling, but you could start to see some push back from the Contractors.

I went on maternity leave at the end of 2018 and came back to quite a different environment.  In the AEMC’s Final Determination on GTPS rule changes, effective from October 2018, they state the following:

AEMO considered the current arrangements for the negotiation of access standards are not adequate to support the ongoing security and efficient operation of the power system. It considered connection applicants often submit levels of performance at the level of the minimum access standard, which is not appropriate in many cases.

to address this, the final rule includes:

  • a requirement that when proposing a negotiated access standard a connection applicant must propose a level of performance that is as close as practicable to the automatic access standard, having regard to the need to protect plant from damage, power system conditions at the proposed location of the connection, and the commercial and technical feasibility of complying with the automatic access standard, and
  • where a negotiated access standard is proposed, a requirement for connection applicants to provide to the network service provider and AEMO reasons and evidence as to why the proposed negotiated access standard is appropriate.

My understanding of this determination is that a lot of the heavy lifting has to be done much earlier in the registration process than it used to.  We’re now seeing the modelling work taking place upfront, before the EPC Contract has even been signed. 

The Contractors are now responsible for meeting those standards, but they haven’t been lumped with the negotiations too.  They aren’t off the hook though. They still have a load of responsibilities.  They have to demonstrate that the facility designed and constructed complies with the GTPS.  They have to meet the requirements set out in the Connection Agreement, carry out any tests required by the NSP and have to complete R2 testing, submit the results to AEMO, and receive confirmation from AEMO that the results have been accepted.

Delay Liquidated Damages on solar farms

I’ve been finding myself doing a few technical due diligence reviews recently, and I thought it was time to do a write up about contracts again. It’s been a while. Today I thought I’d write about Delay Liquidated Damages.

Liquidated damages are a mechanism available to the Principal* when it is not possible to accurately predict what the financial impact would be from a failure on the part of the Contractor. The method for determining damages payable is then set out in the Contract with the idea being that the amount payable is commensurate with the loss the Principal would experience, as a result of that failure. It’s a best estimate, understood to be inexact and subject to negotiation.

Delay Liquidated Damages (DLDs) are payable if the project is not completed on time. They are becoming increasingly complicated. This is a small frustration for a technical advisor (or at least this technical advisor), as it becomes a bit trickier to assess the appropriateness of the rates set out and the methodology proposed.

In simpler days, the DLDs were typically a daily rate for any delay to achieving Commercial Operation/Provisional Acceptance (or whatever your final revenue generating milestone is called.) As an advisor I would then look at the rate and at how much energy was expected to be generated that day. I’d calculate the equivalent price/MWh and compare that against the assumptions in the financial model and by assessing the rate set out in the power purchase agreement, or looking at current market rates.

Things are becoming a bit more complex now. As facilities get bigger there are more completion stages – so damages may apply if each stage is delayed, but also if the facility is delayed as a whole. The energy yield assessment may not have been done on a staged approach. Typically we’d see some sort of output value per month based on the completed facility design. Maybe this will start to change.

Also, sometimes facilities can export power even if they’re not really finished according to the contract. So maybe they have approval to export 30% of their final capacity because they’re constrained for not successfully completing all their grid connection tests. And that 30% electricity that is exported results in some sort of revenue to the Principal. DLDs are then still payable because they haven’t completely finished, but the Principal would be double dipping if they claim the revenue and the full DLDs. After all, the DLDs are there to compensate the Principal for losses. If they’re getting some revenue then the losses aren’t all realised. So DLDs may be netted off against revenue realised.

Finally, DLDs can also be different for different months of the year. Say now a facility is meant to be finished in March (assuming one completion milestone…) March will have a different energy yield profile to August. So the daily compensation should be different. Imagine if Completion was scheduled for March, but through no fault of the Contractor (like grid connection delays), the Completion Date was extended to July. Then the Principal may be better or worse off if the DLDs remained the same if the Contractor was then further delayed. So linking DLDs to the month allows for a better alignment between DLDs and lost revenues.

There’s a lot to digest there.

*I use Principal in this post but different contracts may refer to the party as the Employer or Owner. Or Handsome Devil. The options are endless.

Comments? Reply to this article via Twitter.

For more information on energy contracts subscribe to my newsletter or buy my ebook, Considering Contracts, on renewable energy contracts.

Subscribe

* indicates required

MacIntyre Wind Farm

I am relatively new to Queensland, but I am married to a central Queenslander who has shown me areas of this state that many may not have seen. Some places stark and featureless and others full of surprising quirks and charms.

Near Roadvale. A town that is a road.

In 2015, during our nomadic adventure, we took a trip to Warwick. My husband had spent some of his childhood there. We visited in winter, and it was around the time when it started snowing in Stanthorpe and the whole of Southern Queensland decided that this must be witnessed. We were single minded however, and drove over the range, our attention focused on Warwick.

The view from Box Forest Track off Cunningham Highway at the top of the Range

Warwick was lovely. We walked the town and found the house where he spent some happy years of his early childhood. We saw Thomas Byrnes rugged up, watching over the town, while they were clearly watching out for him.

Thomas Joseph Byrnes all cosy and warm

And so how does this all link to an enormous wind farm. Well the MacIntyre Wind Farm will be built about 50km South West of Warwick. ACCIONA Australia has their eyes on a total precinct wind development of over 1GW.

CleanCo has partnered with ACCIONA for 500MW of this wind farm. CleanCo will build, own and operate a facility of 18 turbines, totalling nearly 103MW, and will then invest in a further 400MW through power purchase agreements.

ACCIONA’s plans for the region include a further ~500MW of capacity. The entire MacIntyre Wind Farm Precinct is proposed to include 180 wind turbines across 36,000 hectares of leased land. I won’t regurgitate the information that can very easily be found on the ACCIONA or CleanCo websites. Well not all of it.

My takeaway is this: the turbines are BIG – 5.7MW each and they will be distributed over a vast stretch of land. ACCIONA expects to create around 400 jobs over the construction phase. The wind farm will change the landscape and impact the local economy. Money for farmers, employment in the community. Construction works naturally result in an influx of project stakeholders. People and business offering accommodation in the region, who have no doubt been hit by the COVID shutdowns may see some reprieve. And on the flip side, maybe an increase in COVID cases for the region. It remains to be seen.

And more people will be driving the route we took over the range. Not for a sleepy meander, but to deliver enormous turbine blades. Maybe some of them will also stop on the top of the range and take a walk. Look at the view.

ACCIONA has created a video explaining a bit more about the overall precinct plans.

Grid Connecting Generation – Is it still a challenge?

Originally posted in October 2019 on LinkedIn by Winodh Jayewardene. Winodh is the Technical Executive – Network Connections and Performance at WSP Australia and contributor for Energy Ramblings.  Re-posted with permission.


It is interesting talking to people in the industry to get their view on the grid connection process and how it compares to say a couple of years ago. My initial thinking before talking to others was that there weren’t any more surprises and overall a much smoother process could be expected, however this does not seem to be the case (this article was started before the recent events in North West Victoria / South West NSW).

The industry has learnt a lot over the last three to four years but it seems that the grid connection process experience is far from smooth and each project has its particular set of challenges.

As an industry it is important to also acknowledge how far we have come and that we are viewed internationally as world leading (this was echoed in my observations during the CIGRE Paris session last year where we seem to have the answers to a lot of the problems others were facing).

Coming back to the challenges, it seems that this time around we are mostly aware of what the issues are, however the process to work through to overcome these issues seems to differ from project to project as well as across NEM regions.

Some initial thoughts on what causes these pains during the grid connection process are noted below.

Consistency of process and requirements

One of the biggest challenges is that of understanding the requirements as they apply within different NEM regions. These specific requirements are often unwritten and it is the reliance on experience that helps to smooth out the bumps along the way.

Some of the challenges that projects face include:

  • the requirement for Continuous Uninterrupted Operation or CUO. Despite it being something that plagued the industry circa 2015, the requirements for this are not yet captured in the recent Generator Technical Performance Standards rule change, even though it was raised by stakeholders
  • approach to technical assessment for projects connecting into weak networks (different NSP’s have different approaches to the FIA process)
  • How to deal with committed and proposed projects, both during the connection application as well as prior to the the registration phase of a project
  • Process for undertaking harmonic studies and the extent of information provided / available.

Experience provides a bit of forewarning about what to expect and how to plan for it, but what if you are new to the market and don’t have the benefit of experience? One way to address this would be to have the expectations set at the start (if you know the right questions to ask), the other way is for consistency through standardisation.

By standardising the process, it forces this process to be documented, and by documenting the process, it ensures expectations are clear. With clear expectations, all parties have a frame of reference and know what the other party wants. After all, how can you successfully negotiate an outcome if you do not know what the other party wants? Some say it is not possible to standardise on requirements, but I don’t believe we have a choice. If we even get half of the inverters on the CEC accredited inverter list connected to the NEM, we will need to standardise on their performance.

Model and design information – How ‘correct’ should it be?

Traditional generation constituted rotating machines where their performance was largely dictated by their electro-mechanical characteristics. However modern Power Electronics (PE) interfaced generation such as Type IV wind turbine generators, Solar PV inverters, HVDC links and battery energy storage are PE interfaced and effectively decouple the energy source from the electricity network.

Hence performance of the generating system is essentially dictated by the switching controls of the converters and the performance can be ‘whatever you want it to be’ (within some reason of course such as current limits of power electronics and DC bus voltage considerations). How the PE connected generator performs is then essentially determined by the control code that is in the converter, hence the importance of ensuring the models are an accurate reflection of the actual code in the converter. Given the high switching frequency of these converters (and the fact that they are asynchronous devices) means the type of instability that could occur is at shorter time-step than what we are used to with synchronous machines (one of the reasons to move to EMT modelling tools such as PSCAD).

PSSE_PSCAD

Take for example the figure above which shows the comparison between an RMS assessment tool (PSS/E) and an EMT tool (PSCAD). The higher frequency oscillations are due to fast acting converter controls which would not be evident in an RMS tool (RMS tools were never designed to assess such phenomenon).

Getting access to information

The National Electricity Market (NEM) is one of the largest interconnected power systems in the world (constituting over 40,000 km of transmission lines/cables and 200 terawatt hours of electricity delivered to ~9 million customers). It could be argued that connecting a ‘small’ generator to a large power system may not have a material impact on either generator or network, hence some small inaccuracies in information may not have a significant impact on the outcome of any technical studies or the network in general. However ‘larger’ generator connections can present their own challenges. What is ‘small’ vs ‘large’ depends not just on the MW size of the generator, but also the network it is connecting into and there is not a simple formula you can apply to quantify ‘small’ versus ‘large’.

That said, to assess the impact of one generator (in particular a ‘large’ generator) connecting to the network, requires a lot of information about not just only the network, but also how the network is operated. Without this information, it is not possible to fully assess the impact of a generator connection (both in terms of impact of the network as well as determining the Generator Technical Performance Standards (GTPS) for the generator). With over 50 GW of new generation proposed to connect to the NEM, often connecting to parts of the network that were never design to accommodate generation, obtaining information required to undertake GTPS studies in a timely manner is often a challenge (both for the generator as well as the NSP).

However this information is crucial for both the generator and the NSP and the latter does have obligations under the NER to provide such information to proponents. Some of the information that is often difficult to obtain includes:

  • PSS/E and / or PSCAD models of network reactive plant (SVCs and STATCOMs) – these either never existed in the first place or are not robust enough to include in power system studies and can impact schedules
  • PSS/E and / or PSCAD models of nearby committed generators (PSS/E models are typically available as projects are committed and availability of PSCAD models has been somewhat addressed under the System Strength Impact Assessment Guidelines)
  • Network frequency dependent impedance for the purposes of undertaking harmonic studies (without this information it is not possible to undertake a harmonic study, some have tried by making ‘assumptions’ and suffered the repercussions come commissioning). The adage of ‘rubbish in’ / ‘rubbish out’ couldn’t be more relevant in this context.
  • Operational information related to the network (eg normally open lines, operating patterns of other generators that can have an impact on voltage control or system strength)

In some cases this information is not available to be provided by the NSP and the only options are to either wait until such time that this information is available, or develop this information yourself (the connecting party in the case of a new generator). This is likely the reason some projects make assumptions on inputs to keep things moving (careful what you assume!). Eventually the risk that a lack of or incorrect information this presents will catch up to the project, hence requires careful management (this is where experience and sound engineering judgement comes into play to understand the extent of missing information and the risk it presents).

Resources and skills

We have an unprecedented amount of new generation connecting and a fundamental transformation of our power system. We don’t know exactly what the generation mix will look like, however one thing is for certain, and that is that there will be a major impact on how we plan, operate and maintain the power system as a whole.

To assess this requires sound power systems knowledge and experience. Power systems are a bit like large jigsaw puzzles where each piece has a role to play. Unfortunately those without good power systems knowledge get too focused on the one piece and expect that one piece to solve all the problems of the ‘puzzle’.

This presents some challenges such as:

  • Resourcing the sheer volume of projects – the growth in new connection volumes has taken place quite rapidly over the last three to four years. We are still playing catchup in terms of having experienced power systems engineers who are able to separate the ‘little detail’ from the detail that matters. There are some young clever minds coming into the industry, but we have a long way to go still to fill the gap in good overall power systems knowledge. This is crucial to ensure we efficiently plan for and integrate new generation into the network.
  • Technology change – this presents a challenge in terms of new problems to solve, but also an opportunity in terms of the speed of implementation for new technologies. The challenge is to not only keep up with technological changes but also embrace it with a careful eye.

Responsibility and Risk allocation

Grid connection risk is a big topic at the moment, probably because this presents the single largest risk which could delay first generation. Who takes on this responsibility depends on the contracting method but under EPC wrap arrangements, this has traditionally been taken on by the EPC contractor. Like any risk, not fully understanding the nature of the risk and its consequences can result in some pretty dire consequences (as was the case for RCR). However we are seeing a re-allocation of grid risk and this shifting from the EPC back to the owner in the context of fully wrapped EPC contracts. Under multi-contract or supply only contracts it is a different story of course and hence further care required as to roles and responsibilities around grid connection risk.

A typical fully wrapped EPC contract may look like this:

If you have not already picked it, the NSP/Operator and EPC interface is a crucial aspect in order to get projects connected, however there are no contractual obligations between the NSP/Operator and the EPC (these are typically discharged from the Owner (via a project and/or connection agreement to the EPC). The consequence of delays would then sit with either the EPC or owner but not with the NSP/Operator (noting that the NSP/Operator and project both have obligations under the NER to ensure a secure, stable, reliable and safe power system). This is probably another topic on its own, however system security and stability take precedence above all else and there is a relatively large imbalance of ‘power’ between NSPs and proponents which can further complicate the grid connection process.

Summary

It seems as though the grid connection process is still a major challenge and although we are moving in the right direction, there is a lot more to do until we can get to a position where the grid connection process isn’t one of the biggest challenges for connecting new generation.

Addressing this challenge and is extremely important in order to ensure we have sufficient supply coming online to meet demand and do so in the most efficient way such that we have a reliable, secure and stable power system.

A test ride of Brisbane’s Lime Scooters

The Last Mile problem (not to be confused with the Three-Body Problem, but possibly as hard to solve) is the struggle that transport planners have in getting commuters to use public transport if they have to walk the first or last stretch.  Transport infrastructure may be fantastic for the most part, but if a passenger needs to walk for twenty minutes after hopping off their train, they may look to take a car instead.

Bicycles make a lot of sense, as they can chew up the distance from the station to home or the office, but they are mostly cumbersome to have on the train, especially during rush hour.  In Melbourne, I’d often get passed by people on skateboards while walking from Flinders Street station to the South Bank.  This is not a bad option, as skateboards can be popped onto the back of a backpack and carry pretty well, but they’re not for everyone.  The few times in my life that I’ve been on a skateboard I’ve feared for my knees, elbows and life.

So this weekend, my little family tried out the Lime scooters which are being rolled out (pun intended) in Brisbane.  These surprisingly tall and heavy electric scooters are found scattered around the CBD, and along the side of the river.

IMG_20190504_125431

They cost AUD1 to unlock, then AUD0.30 per minute to ride.  We had a fun time up and down the river’s edge, dropping a smooth AUD11 for our little half hour adventure.  You download the app, locate a nearby scooter and scan its QR code.  Then it’s unlocked and you can take it for a ride.  The app will show how much distance is left in the scooter’s battery.

It’s hard to say how many scooters are dotted around Brisbane, but the app shows that they are fairly ubiquitous in the CBD.  And people are using them.  Everywhere you walk people pass you on them.  They are quiet, very quick and easily accessible.

Lime_app

One of the problems with bike rentals is finding a drop off point, which can make them inconvenient.  When you’re finished with the scooters you just tap out, and leave them on the side of the road.  Ready for the next eager scooterer to hop on.

And when they start getting low on juice?

“Our Lime-S electric scooters are monitored remotely by both local staff and an independent team of Lime Juicers. When a scooter is running low on power, our Juicers will pick it up, charge the battery and then redeploy the Lime-S out in the community.” – Lime

Many of the scooters have helmets hanging off of them, but there are many people cruising around without one.  My conscientious husband asked a passing policeman if they were mandatory (apparently they are).  It was also pointed out that only one person was allowed on at a time.  Pictures below reflect compliance…

Our son enjoyed it and I was surprised at the oomph provided by the little motor.  A great overall experience.

IMG_20190504_125352
IMG_20190504_125500

IMG_20190504_125505

IMG_20190504_130921

IMG_20190504_130943

Interview with Heidi Sick – Women Leaders in Energy

Throughout my career I have encountered strong and vibrant women.  It has been a pattern in my working life to be in a team which is led, either formally or informally, by a woman of absolute substance.  And I am not sure what working life would be like without it.  I recently moved from Melbourne to the Sunshine Coast, and with this change of office I leave an extremely high-functioning team.  It has been established and led by Heidi Sick, the Section Executive for WSP’s Power team in Victoria, and the market lead for renewable energy across Australia.  On top of my move, I am now on maternity leave and I find myself in a good place to reflect on my career to date, and my aspirations going forward.  I thought a good way to approach this reflection would be to talk with some of these women who inspire, who create and who lead.  I met with Heidi while down in Melbourne in March.  While the discussion below outlines our quick half hour chat, there is so much more that can be said about this woman, who has been so supportive over the last two years, and who has been an incredibly valuable sounding board and personal champion.

Putting a team together 

When Heidi started in her current role, in 2009, the team structure and mandate was very different.  After a couple of years, she moved into a team management role, her first people management role with direct reports. Hers was a team of six, two of whom were women.  She had no power generation background, but the person who interviewed her saw leadership qualities in Heidi and she was appointed to the role. 

“I had no idea what I was doing, no idea what to do.  I decided to focus on what the team can do, their capabilities, strengths, interests and passion, and to support them and make sure that they were fully engaged. I then had to get up to speed with understanding the market and the sector, build client relationships and focus on business development.  I realised that if I didn’t have strong relationships with my team then they would leave.  After a couple of years I went on maternity leave and came back to manage a larger team with different capabilities, which included wind engineering and networks.

Before I went on maternity leave I was fully billable, focusing on project delivery as my team was relatively small with limited management burden. Looking back my role felt more like an administration/management role rather than leadership.  When I returned from maternity leave, due to a restructure I had a larger team with two additional capabilities to manage. I recognised there was no way that I could be an expert in all of these areas and I needed to rely on my team’s technical skills and expertise, and so a collective leadership style started to emerge. I asked a lot of questions, practised active listening and focused on understanding what they needed and how we could develop and grow each capability further.  I used this intel to inform strategy and made key decisions to help shape the future of our team. Reflecting back, it was a collective leadership style, but without me realising it.  It is interesting to me now, because the Women on Boards Next Generation of Female Leaders Program describes the leadership style of the future as being about collective leadership, where you draw out the strengths of everyone in the team.  Because as a leader there is no way you can know everything.”

A pause here for some quick stats about Heidi’s team.  There are nearly 30 people on board now, and women make up about 37%.  What was interesting to me working in that team is that Heidi is the head of the entire team, with three managers under her, focusing on different renewable streams of work.  And two of these three managers are women.  Quite a few of the senior engineers are also women.  So the 37% stat is impressive on its on, but it stands out even more when you know that the women on the team are leaders in their own right. 

Cooking for a Cause team building event for Heidi's Melbourne Power Team.
Cooking for a Cause team building event for Heidi’s Melbourne Power Team.

I asked her if diversity was a conscious decision.  “50/50.  Gender diversity is getting harder to maintain as the team grows.  For graduate roles, I was focused on finding women to apply for roles in the earlier career stages.  Whereas for the more senior roles it’s more about who is available, particularly in such a buoyant industry.  Obviously in the current market there aren’t that many people available, however I was fortunate to come across some really competent and talented women. Once we interviewed a strong female candidate, and my colleague was concerned that she was too quiet and did not sell herself.  However, I had no doubts that she would be amazing, which was exactly the case. It’s about understanding how women portray themselves and knowing that most of us have problems in promoting ourselves and really putting ourselves out there, particularly in an interview situation.”

Motherhood

So has being a female leader had an impact on the gender diversity of the team?  Having this kind of insight in an interview must have an impact.

“Absolutely – women attract women.  Some of my female team members moved across because of a female leader.  One of my engineers could see I was working full time, with a family and juggling it all.  She could trust that I was living it.”

I can vouch for this myself.  Heidi has two amazing and beautiful boys, two years apart, at pre-school and primary school level.  When I was interviewing for my role, I hadn’t worked in over a year.  I didn’t have any care lined up for my son, because I wasn’t expecting to start working, and I wasn’t sure what I was looking for in the next few months. The idea of putting my son into care was intimidating.  But during the interview process I really believed that Heidi understood my situation, was committed to ensuring I had flexibility in my work, and supported me in limiting my work to three days a week.  I don’t think I would have been so willing to start working just then if I didn’t have this sense of flexibility, empathy and support.

So what traits do motherhood give a working woman?

“I think about the person I was before I had kids.  I was really selfish.  As soon as I had my children,  I became much more open, caring and selfless and had a lot more empathy. It gave me a much better understanding of what other people in my team were going through. From morning sickness to failed IVF treatments, from fear of leaving work to fear of returning to work, fathers taking paternity leave and then balancing part time work. Looking back I feel grateful that they all were able to confide in me. Having already gone through it I knew what I needed to do, to empathise and support however I could.  

For me, motherhood has helped me to prioritise what’s important at work, what needs to be done before leaving at the end of the day.

“Unfortunately I haven’t been as strict on that front as with consulting there’s often inflexible deadlines.  After having children there is a greater sense of urgency and being efficient with my time.  You know you have limited time and if you don’t get things done in that time it’s after hours.  Limiting my work after hours is something I’ve been trying to focus on this year and it has been slightly better but it’s still not where it should be.  Whenever I’m in dire straits I will ask for help, but then I feel like I am not managing well enough.  I guess that’s one annoying trait is you always have mother’s guilt. Guilt for working, guilt for any time you have to yourself and guilt for feeling like you should be a better mother.  Feeling like you’re not doing anything good enough is a common post maternity leave feeling.  You’re not in the right headspace from sleep deprivation, or you’ve got so much on that it’s hard to be present when you’re at home with the kids or when you’re at work. Now that my kids are at school, it is getting better, but quietening the inner critic is a task in itself..”

Now Heidi and I have had a lot of chats about the inner critic.  Previous female colleagues have also felt this heaviness, this monster that sits on your shoulders, undercutting your confidence.  So I asked her how hers was doing.

“It’s pretty good actually.  Sometimes, the more downtime you have the more it can creep in.  If you’ve had some time off and you come back to work, and are catching up there are moments where that inner critic or the imposter syndrome raises its ugly head”

Heidi recently won a scholarship through the Clean Energy Council for a course called Your Leadership Voice.  It’s a fantastic recognition of what she’s achieved.  I asked if this has helped with silencing the inner critic (or at least muffling it.)

“Obviously getting the recognition and exposure has been really good.  I often  think that anyone can do my role and that its no big deal. But then the CEC’s speaker guide was published and there are 7 women from my team in WSP in the guide and that’s actually really fantastic.”

Me, Lina Khalil and Heidi at the Solar Industry Forum in 2018
Me, Lina Khalil and Heidi at the Solar Industry Forum in 2018

Women in leadership

The scholarship is not the first leadership course that Heidi is doing.  She recently completed the Women on Boards (WOB) Next Generation of Female Leaders Program.  So it got me thinking about how some men seem to be groomed for leadership from an early age, perhaps unconsciously.  I asked if she thought it would have been a harder road without supplementing her role with studies? 

“Speaking generically – women rarely put themselves forward for the next role.  But for me, somewhere along the management pathway these leadership qualities started to come out. Thankfully, I had the opportunity with WOB and through the WOB course I had the headspace to recognise that I had some natural leadership qualities and that those qualities were valuable, and so it really inspired me to want to continue to develop those skills. I have so much to learn and develop and it is so interesting.  It’s all about people, relationships, being human, connecting and engaging to achieve a common set of goals.”  

This is a hard skill to quantify. It’s hard to compare it to technical knowledge, where you know how to size a bolt.  But it’s important and interesting nonetheless, because in the engineering sector you often see what happens when a heavily technical person is put into a leadership position without these skills…

“Quite often men will confidently put themselves forward for the next role. As everyone knows, if there’s a list of six requirements in a job ad, guys will have a completely different approach to it, saying ‘I’ll be able to do that’ whereas women will say ‘I haven’t done that’ and they won’t apply for a job unless they tick most of the boxes.  I’ve had a couple of experiences where I have had opportunities come up and just doubted that I could do the role.  So I have had interviews where my heart wasn’t in it purely because I didn’t have the confidence to back me up.”

I asked Heidi if she had ever found herself chasing a female candidate who hasn’t put themselves out there, but who had potential.

“For me this is one of the most important things we should be doing as an organisation; identifying those women who are suitable for the senior level but possibly haven’t had the management or leadership experience. One of my team members is a great example. She said she wasn’t ready for a leadership role. After managing to convince her, she is now flourishing, she loves the people management and leadership side.  It’s important to give women that opportunity, being proactive in identifying them, and helping them take that initial leap. I was fortunate that someone saw potential leadership qualities in me, otherwise  I don’t know where I’d be. The last few years have been the most enjoyable of my career. “

Photos: Parkes Solar Farm, NSW, Australia

It feels like just yesterday, but five months ago I moved from Melbourne to the Sunshine Coast.  On the way up decided we’d take a leisurely drive up through central New South Wales.  The main aim was to visit the Parkes radio telescope and Dubbo zoo. But at the back of my mind I knew that there were a few solar farms in the region, and while it was a bit of a whistle stop tour, we did manage to swing past Parkes Solar Farm.

Parkes is a lovely town – bigger than we expected.  We had spent the evening before watching The Dish so we were ready for the telescope itself.  It’s really impressive.  An incredible piece of engineering, a significant part of astronomical history and just a generally interesting place to visit.

Parkes_Dish

I have a bit of background knowledge on the Parkes facility, having been aware of some of the comings and goings during construction, through work, and it was good to see it in person.  The developer of the project is a French owned company called Neoen.  Some takeaway stats from the project’s site:

  • Installed capacity: 66MW
  • Expected annual generation: 138,000MWh
  • Land size: 210 Hectares
  • Commencement of full operation reached March 2018

General layout:

Source: Parkes Solar Farm
Source: Parkes Solar Farm

All of these nuggets of info are out there in the public domain, so the main point of this post is to show off pics from a drone that was sent up outside the site.  Behold, Parkes Solar Farm.

Parkes9

Parkes8

Parkes7

Parkes6

Parkes5

Parkes4

Parkes3

Parkes2

Parkes1

Neoen has a few other projects in NSW, and I have worked briefly on some of these in various capacities.  I’d done a site visit to Griffith Solar Farm before at the end of construction, and had a hand in Coleambally Solar Farm in the lead up to Financial Close and during construction (the project reached commercial operation recently, which was impressive, given the short construction timeframe and the ambitious size of the project).  Neoen also have Dubbo Solar Hub in NSW, made up of Dubbo and Narromine Solar Farms.  I was within spitting distance of the Narromine farm, but we just didn’t have time to get there.

While Neoen has extensive experience in NSW, they have also been making inroads into other states.  I had been involved on Numurkah Solar Farm prior to Financial Close – this VRET project is currently under construction in Victoria.  They also have development approvals in Queensland, and I know that they are actively pursuing various other options.

Solar facility construction milestone and payment claim review

Large scale solar construction projects are typically made up of dozens of milestones, outlined in the contract, which need to be met before payments can be made to the contractor.  There are normally at least three parties involved in the processing of these payment claims, and they can cumbersome things to navigate.  This post looks at what the typical milestones in a solar project are and what documentation is important.

But first, a step back. To defining the milestones:

Prior to financial close (where the necessary contracts are executed, and financing is secured) there will likely be a bit of backwards and forwards on what the key project milestones will be, and how much of the overall lump sum contract price will be allocated to each.  The milestone schedule, payment schedule, project programme and financial model are all built and developed in parallel, and changing one may have an impact on the others.  The contractor is interested in making sure that they have healthy cashflow throughout the project.  Procurement activities in particular require a heavy outlay of cash, so they will want to get paid for completed procurement works, which typically take place towards the front end of the programme.  The owner, and lenders, will want to make sure that they are receiving value for these payments, so they will be interested in making sure that the payment amount is fair, given what works have been completed.

Some of the typical milestones (and therefore payment triggers) include the following:

Notice to proceed

This is a mobilisation payment, often made to the contractor upon the award of the contract.  For instance 10% of the contract price.  The evidence required from the contractor is typically a letter from the owner to the contractor confirming that they have permission to go ahead with the works under the contract and that any conditions precedent to them starting works have been met, or waived as required.  It may be accompanied by other documentation showing that the contractor has done all the necessary preparation works, such as securing insurance, accessing bank guarantees, appointing certain key personnel etc.  The level of complexity in assessing this milestone is very much dependent on the contract requirements, but it should not be overly complicated.

Equipment procurement

This shows that the contractor has place the orders for the equipment.  The evidence for these type of milestones is typically in an executed (and often redacted) contract with the equipment supplier.  Additional requirements may include the supplier’s quality management plan, factory acceptance test schedule, delivery plan, and transportation, storage and handling, and installation and operations & maintenance guidelines.  Reviewers should be checking that the specifications of what has been procured matches the contract employer’s requirements.  The product warranties should also match the contract.  Delivery schedules should be in line with the project schedule.  Key components and equipment in a solar facility included as milestones are typically PV modules, structures/trackers and inverters.

Equipment delivery

This is to demonstrate that the equipment procured has been successfully delivered.  These milestones should be accompanied by a lot of documentation.  This can be one of the most onerous milestone types and it’s very important that the contractor has good controls in place to make this easy to review.  For each equipment type, there should be a summary report which links actual equipment to containers or batches.  For instance, PV modules will likely be manufactured in batches.  Each PV module has a serial number, and these serial numbers are grouped together into pallets.  Which are grouped together into containers, which are grouped together into batches.  Which cumulatively make up the entire facility.

There should be documentation and reporting which allows someone to trace each module from the manufacturing line all the way to its delivery to site.  A summary report should be maintained, identifying the position of each container (ex-works, on a ship, at port, on site etc) and a reviewer should be able to identify which containers have been delivered to site.  This summary report should be supported by a myriad of documentation, including packing lists, waybills/bills of lading, serial number lists and delivery notes.  In addition, there should be factory acceptance test reports and any independent factory inspection reports provided, and any applicable certificates from the manufacturer.  The reviewer’s role here is not to go through everything in minute detail, but to carry out spot checks to verify that the contractor’s report is accurate, and that they are implementing proper logistical and document control throughout the whole process.  Site inspections are then often carried out to verify that the equipment is being delivered in good order and that the contractor is complying with the handling and storage guidelines.  It can be a big job, and messy and confusing paperwork makes it a whole lot bigger.

Keeping track of millions of components requires a lot of competent people doing competent people things
Keeping track of millions of components requires a lot of competent people doing competent people things

Construction completion

There are a lot of construction activities that can be considered for payment milestones: mobilisation to site, the completion of the boundary fence, access roads, O&M buildings and substations.  But it’s typically the repetitive activities that get most of the attention, which in the case of solar are largely piling, tracker installation, module installation and inverter (or MV power station) installation.

What’s important here is what is understood by both parties to be a completed construction activity?  On any project there will be some punch list activities that need to be closed out, but what is considered to be reasonable? Does everyone agree?  For electrical equipment, is it enough that the unit is physically in place or should it be connected, with cables plugged in?

How is the facility divided up into sections?  Is a milestone linked to an individual section of the facility?  Or can the contractor claim for a percentage of works completed, regardless of where the works are taking place.  Keep in mind that the first wave of construction activities can be fairly quick to do, but coming back and resolving quality issues, and closing off punch list items can take longer.

Quality documentation is the most important here, and what is inlcuded in the overall payment claim should match the contractor’s progress report, which, in turn, should align with the quality documentation.  Inspection and test plans (ITPs) should be followed, and there should be inspection and test checks that are provided.  Observations during walkarounds on site should align with the contractor’s quality documentation.

Mechanical Completion is often a key construction milestone.  For this, all construction activities should be completed, quality documentation should be available, the punchlist should be manageable, and not affect the facility’s performance or safety, the facility should be ready for commissioning, and all the little construction activities that may not have been included as individual milestones (such as the security system) should be in and ready to be commissioned.

Commissioning

Commissioning milestones may be separated into cold commissioning (commissioning activities that can be carried out before the facility is connected to the grid) and hot commissioning (after grid connection).  It is common that the owner, owner’s representative, independent or lender’s engineer may witness selected commissioning activities, to confirm that the data provided match the observations on site, and to verify that the contractor is following the commissioning plan.  But commissioning milestones are often overshadowed or substituted for major completion milestones, such as practical completion or even commercial operation.  These major milestones are influenced and informed by performance tests and grid compliance tests.

A portion of the contract price, such as 5%, is normally held for these milestones, and the contractor needs to demonstrate the facility’s performance and compliance with the network service provider/regulator/purchaser’s requirements.  The nature of tests to be conducted and paperwork to be provided is determined by the local regulatory requirements.

They will also need to show that the facility is able to perform, by applying the performance ratio (or equivalent) tests outlined in the contract.  Performance data should be provided for review, along with the application of calculations as defined in the contract, and any underperformance may be subject to performance liquidated damages.


I have worked on projects with nearly one hundred milestones, and others with only a few dozen.  What matters most is whether they are clearly defined, and whether the parties have agreed upfront what constitutes the completion of an activity and what information and documentation is required.  I couldn’t overstate the importance of having a session or two right at the beginning of the construction phase to clarify expectations as early as possible.

The complex world of Japanese waste management

I recently got back from a two week holiday in Japan.  The first week was spent snowboarding up north and the second week was in the madness that is Tokyo.  In both, I encountered confusing, and strangely strict, recycling rules that were difficult to follow and seemed to change from region to region.

Ueno_park

In the house that a big group of us had rented at the snow, we were asked to separate our recycling into cans, bottles, food waste and other.  Simple enough.  Around the ski resort bins were separated into ‘combustible’ and ‘other’.  And then when we got down to Tokyo, we had four pages of instructions in the AirBnB welcome pack about what needs to be separated and how to do it.  Rubbish was collected on our street every day, but I couldn’t see any difference in the trucks driving around and they all seemed to lump rubbish bags together without any apparent distinction between bags.  Other than crates of cans and bottles that were loaded up separately.  Who knows where those crates came from.  It was incredibly confusing.

There are a lot of articles out there which go into the complicated nature of recycling in Japan in much more depth than I would be able to having been there for just one week.  I found this one interesting.

But it’s an important topic.  Because there are vending machines dotted (spray-painted) all around the streets of Tokyo.  Everything comes in plastic.  Individually wrapped goodies are ubiquitous, and when you buy a single plasticked thing, it gets placed in a plastic bag.  And having seen what I’ve seen in the Philippines, this was naturally a bit distressing.

The Rockefeller Foundation has two Japanese cities within its 100 Resilient Cities programme; Kyoto and Toyama.  I didn’t visit either, but the Toyama Resilience Strategy is probably reflective of other Japanese city priorities.  They celebrate their existing waste management practices, and point out that individuals take ownership of their role in keeping the city clean.  But from a municipal level they also discuss grander plans and highlight the importance of the development of the city’s waste to energy industry.   “With city incentives, seven different companies now turn “waste” into usable products at the EcoTown Industrial Park, started in 2002. An extensive waste recycling education center increases citizen awareness of the methods and importance of waste recycling.” [Source] . They also point out the importance of incorporating waste reduction and recycling principles into education programmes and messaging.

Layout of Toyama Eco-Town [Source: Toyama Resilience Strategy]
Layout of Toyama Eco-Town [Source: Toyama Resilience Strategy]
What they don’t seem to do is look at reducing the amount of waste generated in the first place.  It all seems to focus on waste management, recycling, combustion, landfill.  There doesn’t seem to be any emphasis on rethinking packaging of products in Japan.  Talking to manufacturers.  Rethinking the need for wrapping up Pocky chocolate sticks (yum) into two separate packets within one single box.

We felt plastic sick by the time we got home.  And considering how much work each individual is expected to do in their day to day household recycling, and the social pressure that seems to be experienced at this domestic level, it’s not clear if any of that pressure is being directed upwards.  Both at the regulators and at the suppliers.

Asia has a lot to answer for with plastic consumption.  And Japan has enough resources to find a suitable response.

The tricky nature of design and construction overlap in solar projects

Design

Solar PV facilities have ever increasing pressure on construction timelines.  In theory they are fairly simple design and construct projects, and one of the major benefits of these facilities is that they can come online in a relatively short space of time, and start generating revenue quickly.

So standard processes and procedures used within the engineering sector may be put under increasing pressure, in order to realise an early commercial operation date.

In an ideal world, the facility design is carried out upfront.  Site investigations are conducted, studies are done, calculations are calculated and all of these feed into the design process.  Design docs are developed, and bundled up into neat and ordered packages, which are handed over to the owner for review and comment.  Once everyone has had their turn to check that the design is in good order, and fully compliant with standards and specs, equipment is procured, and construction management documentation, such as work method statements, are developed.  Controlled.  Organised.  And compliant.

The reality of these projects is vastly different.  Certain things are known from contract negotiation – which modules, mounting system and inverters will be used, what is the overall facility capacity, where are the roads going to be located.  Designs will also be nicked from previous projects, to save time and cost, altered and amended based on local conditions.  Everyone will be watching the procurement of long-lead items with a keen eye along with any other activity under the project’s critical path.

So it’s likely that the design will be put together in clumps and blobs.  Loosely bundled documents, with vague references to geotechnical reports and flood studies, will come through in a piecemeal fashion.  Often before it’s been reviewed internally by the contractor.  There is enormous pressure on the Owner to carry out their reviews and issue comments with no delay, as everyone’s watching the clock.  But this way of submitting documentation is onerous on an owner’s engineer.  It’s difficult to plan and allocate resources when you’re not sure when documents are going to come through.  It can be hard to keep the same people on the job, which means more time spent by your engineers getting up to speed with the contract specs.  And it can mean multiple iterations of your log of comments.  It chaotic, pressured and not a whole lot of fun.

So some things that are important:

  • When documents come through, the contractor should highlight any specific aspects of the design which may have an impact on the overall project schedule.  For instance, tracker system design, which needs to be reviewed against local standards may be important as equipment needs to be ordered.
  • The document register becomes an incredibly important tool.  It should be tracking what the latest version of the document is, what the changes were in this revision, when it was issued and what the current status is (issued for review, approval, construction etc)
  • Document control in general becomes incredibly important.
  • The document management system should be easy to use.  If you need to go into the system to download small bundles of documents frequently, then it needs to be easy to navigate and docs need to be easy to download.  Access should be easy to secure, so that people on the design review team can search for documents themselves.
  • Transmittals should include a list of documents included, along with the location of the document on the document management system, or direct links to the documents.
  • Construction documentation, such as inspection and test plans and work method statements, should be developed in parallel, so that when the design is agreed, the ITPs and WMSs are ready, and there is no delay to construction.
  • For very time constrained reviews, it may be appropriate to focus solely on the observations of non-compliance with either local standards or the contract specs.  Design preferences may need to be dropped.  This is for the owner to decide.  They are paying for the product and it is ultimately their decision as to whether they are going for a gold standard project, or a project that finishes on time.
  • The contract should transfer all design risk to the contractor.  If the owner comes across any non-compliance at any point, the contractor should be required to fix it.  Increased pressure on the design phase should not relieve the contractor of their obligations to deliver a compliant project.
  • The contractor should be fully in control of construction quality.  So that the owner can see that the facility is being built to spec, and that accelerated works have not resulted in a poor quality product.

It’s difficult.  There are competing pressures, multiple activities taking place at the same time, and all parties may have limited resources at their disposal.