The challenges brought on by the COVID-19 pandemic affected virtually every aspect of the global supply chain, from the cost of materials to manufacturing durations to overseas shipping. These challenges directly impact construction projects. Meticulously planned schedules depend on reliable material delivery, and tight budgets rely on material costs remaining consistent. For the solar market, essential materials like transformers, inverters, racking, cable and piles are seeing significant procurement delays, with some materials taking more than 10 months to arrive on site. Costs of these materials see large daily fluctuations, sometimes exceeding 5% in a 24-hour period. To understand when to order materials to prevent schedule delays and financial challenges, our clients rely on PCL’s expert staff and market knowledge.
To mitigate the delays of long lead materials, PCL plans project schedules working backward from project delivery, to better understand the critical path for construction. Our procurement strategy includes working with our clients to initiate a limited notice to proceed, so that we can begin to order materials as soon as the project is awarded. We work to ensure schedule commitments from our vendors at the earliest possible time and rely on our strong relationships to optimize the timing of deliveries. Our open, transparent process helps facilitate constructive working relationships with our clients, so that they are aware of the benefits associated with releasing project funds early.
PCL diligently tracks the price of materials across all solar projects and follows developments in the supply chain closely to provide the latest information to clients when advising on procurement. Additionally, our in-house designers are focused on minimizing material requirements by focusing on land use efficiency and alternative products while maximizing energy output. With our focus on efficient design and cost monitoring, we limit material costs and keep projects within budget, despite rising and fluctuating costs.
As U.S. policy makers work to create infrastructure packages and define environmental economic policies, impacts on the solar market, both positive and negative are bound to occur. While facing premiums for material costs, our clients have reservations about how the timing of policy changes may affect their projects. PCL’s experienced teams stay informed about policy developments, as well as state and local renewable portfolio standards (RPS) to better support our clients in making the most financially sound decisions when planning their solar projects.
As the global solar market continues to grow, PCL’s engineers, estimators and construction managers work tirelessly to deliver best value solutions for our energy clients. Tracking and understanding developments related to material procurement, cost escalations and government policy allow us to best support our clients in delivering high quality solar projects within their desired timeline and budget.