Beyond economies of scale: Learning from construction cost overrun risks and time delays in global energy infrastructure projects

IF 6.9 2区经济学 Q1 ENVIRONMENTAL STUDIES

Energy Research & Social Science Pub Date : 2025-04-01 DOI:10.1016/j.erss.2025.104057

Benjamin K. Sovacool , Hanee Ryu

{"title":"Beyond economies of scale: Learning from construction cost overrun risks and time delays in global energy infrastructure projects","authors":"Benjamin K. Sovacool , Hanee Ryu","doi":"10.1016/j.erss.2025.104057","DOIUrl":null,"url":null,"abstract":"<div><div>Every single energy infrastructure project today was once on paper only, and imagined only as a future project, one that had to be financed, planned for, approved, and constructed. One critical element of energy infrastructure at this project planning stage is construction cost overruns and time delays. Using an original dataset 50 % larger than those in the previous literature, this study examines the cost overrun risks facing 662 energy infrastructure projects across 83 countries built between 1936 and 2024, covering $1.358 trillion in investment and a total capacity of >400 Gigawatts. We find that more than three-fifths of the projects experienced cost overruns, with these overruns being particularly prominent in projects exceeding 1561 MW in capacity. Positively, the escalation rate in cost overruns has been declining since 1976. However, the patterns of cost overruns varied by fuel source. For instance, nuclear and fossil thermal projects exhibited higher cost escalation rates over time, whereas solar power projects showed a decline. Critically, both hydrogen and carbon capture and storage (CCS) projects exhibited significant time and cost overruns, casting doubt on their ability to rapidly be scaled up to address climate change or meet energy and climate policy priorities. We draw from these insights to chart future research gaps as well as salient policy recommendations.</div></div>","PeriodicalId":48384,"journal":{"name":"Energy Research & Social Science","volume":"123 ","pages":"Article 104057"},"PeriodicalIF":6.9000,"publicationDate":"2025-04-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"0","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"Energy Research & Social Science","FirstCategoryId":"96","ListUrlMain":"https://www.sciencedirect.com/science/article/pii/S2214629625001380","RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q1","JCRName":"ENVIRONMENTAL STUDIES","Score":null,"Total":0}

引用次数: 0

Abstract

Every single energy infrastructure project today was once on paper only, and imagined only as a future project, one that had to be financed, planned for, approved, and constructed. One critical element of energy infrastructure at this project planning stage is construction cost overruns and time delays. Using an original dataset 50 % larger than those in the previous literature, this study examines the cost overrun risks facing 662 energy infrastructure projects across 83 countries built between 1936 and 2024, covering $1.358 trillion in investment and a total capacity of >400 Gigawatts. We find that more than three-fifths of the projects experienced cost overruns, with these overruns being particularly prominent in projects exceeding 1561 MW in capacity. Positively, the escalation rate in cost overruns has been declining since 1976. However, the patterns of cost overruns varied by fuel source. For instance, nuclear and fossil thermal projects exhibited higher cost escalation rates over time, whereas solar power projects showed a decline. Critically, both hydrogen and carbon capture and storage (CCS) projects exhibited significant time and cost overruns, casting doubt on their ability to rapidly be scaled up to address climate change or meet energy and climate policy priorities. We draw from these insights to chart future research gaps as well as salient policy recommendations.

查看原文本刊更多论文

求助全文

约1分钟内获得全文求助全文

来源期刊

Energy Research & Social Science ENVIRONMENTAL STUDIES-

CiteScore

14.00

自引率

16.40%

发文量

441

审稿时长

55 days

期刊介绍： Energy Research & Social Science (ERSS) is a peer-reviewed international journal that publishes original research and review articles examining the relationship between energy systems and society. ERSS covers a range of topics revolving around the intersection of energy technologies, fuels, and resources on one side and social processes and influences - including communities of energy users, people affected by energy production, social institutions, customs, traditions, behaviors, and policies - on the other. Put another way, ERSS investigates the social system surrounding energy technology and hardware. ERSS is relevant for energy practitioners, researchers interested in the social aspects of energy production or use, and policymakers. Energy Research & Social Science (ERSS) provides an interdisciplinary forum to discuss how social and technical issues related to energy production and consumption interact. Energy production, distribution, and consumption all have both technical and human components, and the latter involves the human causes and consequences of energy-related activities and processes as well as social structures that shape how people interact with energy systems. Energy analysis, therefore, needs to look beyond the dimensions of technology and economics to include these social and human elements.