De-risking large renewable energy projects to meet future clean energy demands

Generating renewable energy at scale, fast, is mission-critical. In a historic agreement during the 28th Conference of the Parties (COP28) in Dubai, 130 countries pledged to transition away from fossil fuels and triple renewable power energy capacity to 11,000 gigawatts by 2030. This commitment aligns with the International Renewable Energy Agency’s (IRENA) 1.5°C Scenario, which presents the only viable pathway to limit global temperature increase to 1.5°C. 

If countries do not increase current installation rates, we risk falling short of the target. It is urgent to scale wind energy, solar energy and long-duration storage to help deliver the energy transition this decade.

To contribute to this bold ambition, utilities around the world are demonstrating efforts to enhance the grid and diversify the power mix with clean energy. BC Hydro, British Columbia’s primary electricity utility, is one of the energy providers seeking to significantly increase the electricity it supplies through renewable energy sources. In 2024, BC Hydro launched its first competitive Call for Power in over 15 years, aiming to acquire approximately 3,000 gigawatt hours per year (GWh/y) of clean electricity, representing a 5 percent increase to its current supply. GHD served as the Technical Advisor for this landmark initiative. 

Call for Power processes need clear objectives and criteria, transparency, robust compliance and financial evaluation, as well as risk management. It is crucial to identify and mitigate risks — real and perceived — involved in contracting across a variety of clean power projects and technologies, including wind, solar, biomass and hydro. De-risking renewable energy projects enables utilities to establish the likelihood of success, cultivate reliability and make it possible for supply to meet likely demand. 

Another benefit includes effective management of costs and timelines, empowering utilities to complete projects within budget and on schedule. Through this process, decisions around technology and infrastructure are well-informed by research and data. It also promotes better coordination with associated infrastructure works, such as transmission and connection upgrades. 

An independent evaluation is thorough and multidisciplinary in nature.  It involves input from multiple specialists for matters such as legal and regulatory compliance, stakeholder management, permitting, technical feasibility, energy resource profile and deliverability. BC Hydro adopted the same approach and engaged GHD to evaluate the Call for Power proponents’ projects through technical and deliverability lenses. 

Comprehensive technical and energy resource evaluations provide strategic viewpoints to inform decision-making and align with the utility’s goals. These assess essential elements such as resource monitoring campaign and data, project design and development maturity, cost, technology, interconnections, schedule and organisational experience. 

Specific parameters and expectations can be set for each criterion to determine a project’s overall risk level. Interconnections and distance, for example, help evaluate the complexity of the connection to a utility’s grid or the availability of supporting infrastructure for transmission and distribution. This is especially crucial for energy projects or assets in remote areas or far from existing network infrastructure. Other important considerations include terrain, access and climatic conditions. Meanwhile, organisational experience examines an energy producer’s development and operating organisational level, as well as sufficient understanding of local contexts and jurisdictions. 

From a resource assessment perspective, the quality of data collected and data modeling are equally important to determine the potential power outputs and associated risks. That is, assessing the robustness and duration of resource monitoring campaigns and the methodology for determining yield and uncertainty. For instance, the viability of proposed wind projects must be backed by quality data on wind speed, direction, and diurnal or seasonal variation, among others.  

Ultimately, a strategic evaluation and deep understanding of risks enabled BC Hydro to proceed confidently in its procurement. The utility awarded 10 Electricity Purchase Agreements to IPPs for their projects — including nine wind farms and one solar project — that are projected to generate nearly 5,000 GWh/y of clean, renewable energy to its grid. This is enough to power half a million new homes and boost BC Hydro’s current supply by 8 percent, which is higher than its original target. Also, the construction of these projects is anticipated to attract billions in private capital investments and create more than 1,000 jobs in the province. 

The energy transition requires clean energy projects deployed quickly and with understood risks. De-risking the planning, approvals and delivery journey is achievable with a deep understanding of technical viability, resources and supporting infrastructure. These are important considerations when issuing calls for power or developing large renewable energy projects: 

• Adopt a comprehensive view of the project portfolio – A holistic analysis of an energy producer’s portfolio helps assess and mitigate the overall riskiness of projects, including risks associated with transmission line timeframes and contractual obligations. It also helps align a utility’s clean energy capacity with its objectives. 
• Undertake an independent review – While this article focuses on evaluating technical and resource risks, it is valuable to have an independent review of projects against all categories of risks. Engage an external team of consultants to provide a robust evaluation, taking into account global practice with local knowledge.  For example, BC Hydro engaged other specialists to uphold the requirement of at least 25 percent First Nations equity ownership to foster meaningful First Nations participation.  
• Uphold consistency in evaluations – Define clear risk review criteria to be consistent and specific in assessments.
• Promote collaboration to accelerate clean energy deployment – Together, utilities and the private sector can fast-track the energy transition and enhance the reliability and security of electricity to power homes, businesses and communities.  

Connect with us to learn more insights into mitigating risks and building confidence in your renewable energy projects.