Revealed: how the energy crisis is impacting projects
Virtually all project professionals say the global energy crisis will negatively impact current or planned projects in some way, Association for Project Management (APM) has found.
A survey of 1,000 project professionals, conducted with research company Censuswide, found that 99% said they expect an impact on projects they’re currently working on or plan to start working on soon.
The most anticipated impact, cited by 32% of survey respondents, was increased project costs.
Not fully realising the intended benefits of projects was the second-most anticipated impact, cited by 27% of respondents, while 26% predicted delays to projects being started or completed.
Only 1% of survey respondents said they did not foresee any impact from the energy crisis on current or planned projects*.
The most-anticipated impact of the crisis for each industry sector is as follows:
|
Impact |
Most-anticipated within… |
|
Increased project costs |
Construction Education Engineering Manufacturing Retail, Catering and Leisure |
|
Intended benefits of projects not being fully realised |
Aerospace and Defence Government (central or local) Legal Technology Telecomms |
|
Negative impact on the mental health of project stakeholders |
Financial services Healthcare and Pharmaceuticals |
|
Negative impact on the mental health of the project team |
Arts and Culture |
|
Inability to achieve a project's sustainability/net zero targets |
Transport and logistics |
Commenting on the findings, Professor Adam Boddison, APM’s Chief Executive, said: “The breadth of responses from this survey show the many different ways that projects are likely to be affected by the global energy crisis. While the potential for increased costs is clearly a factor, it’s also noteworthy that many respondents anticipate consequences for sustainability goals, benefits realisation, and even the mental health of their colleagues and other stakeholders.
“With current concerns around energy supplies – especially in Europe – it’s no surprise that project, portfolio and programme managers have concerns. Energy security is vital for the successful delivery of projects that will address some of the society’s most pressing challenges. If the UK is to achieve its goals for levelling up, tackling climate change and addressing skills shortages, it will be essential for the government to invest in the production and supply of energy that also takes account of sustainability goals. Only with the required investment and focus in this area will the projects that enable a better future be delivered.”
*All figures rounded to the nearest 1%
4 comments
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How long do we expect this Supply breakdown and energy issues to prolong? Why is it happening? WAR or COVID (or both). Was this not able to be predicted and why not? These are the question we need to understand to solve the problem and prevent it from happening again. I have my suspicions but would like to understand what others are thinking to validate my views. Ashok Singha
Thanks for your comment Ashok. You make several good points. The unknowns around energy supply make this an understandable cause for concern among project professionals and questions need to be asked around procurement and security of future supplies in order for project practitioners to be confident around planning and benefit legacy. Like yourself, we're extremely interested to hear what others in the profession think.
Ashok It seems like the perfect storm with the multiple issues we are facing.. Brexit which had affects on haulage oil & gas supplies, Covid which i'm guessing slowed down oil & gas production due to reduced demand then a sudden surge in demand once covid restrictions started to lift and then the war in Ukraine and the European over reliance of Russian gas causing a rethink in global energy strategies. There are many lessons to be learnt ,to many to mention but energy procurement & security will be on everyone's mind now..
The energy crisis has been foreseen for a long time, alongside the climate emergency. As with any change it represents a challenging time for those engaged in the status quo but a time of opportunity for those willing and able to engage in change. This is a good time for projects as projects are what facilitate change to happen in a positive way.