With industry leaders calling for more clarity on energy market reforms, this sector is now presenting real opportunities for interim managers. Nigel Peters examines the challenges and chances for interims working in energy.
The Government, through the Department of Energy & Climate Change (DECC), is currently trying to address the problems of rising energy prices and shortages of supply until the build of new nuclear power stations comes on line. (Notably the DECC is the only Government department increasing in size at the moment which shows the scale of what lies ahead.)
Their approach of providing security and diversity of supply should be lauded, but time and resource is not on their side. There is much effort needed and immediate projects such as Super Magnox and the recent high profile activity in the domestic retail space, with the fining of SSE for anti competitive activities, all present significant challenges to be solved. Such an active sector leads to pressures that are markedly different from those experienced generally in the market since the falls of 2008. But how can interims support these pressures?
The Challenges for Interims Working in Energy
In a moribund market space, any growth or investment must be viewed positively (HS2 detractors won’t agree with this!), as it is providing welcome stimulation which highly skilled and flexible interims can support with much needed advice and delivery. Some of the areas that interims working in energy can really influence in energy include:
Nuclear New Build
Starting up a business and a major project such as new build requires both those with the wherewithal to understand the investment required and the approach to getting a new business unit right from the very start. If the foundations are broken, a new business in this space will not be sustainable.
New Technology Start Up
AD and Biofuels and gas to grid are all part of the diversity of the future supply. These sorts of new projects will require deep understanding of the sector, especially feedstocks. Without this knowledge, costly mistakes could be made - chasing the market with unproven technologies can lead to very expensive errors.
Integration of better systems to drive energy efficiency is absolutely key. As part of the Government’s drive to reduce CO2 significantly by 2020, there are countless technologies and projects that purport to bring efficiencies and reduce CO2. But there is no silver bullet (domestic heating insulation is a significant means). In most instances, real and deep specialist knowledge is required for success.
Major Outsource Projects and Bids
Super Magnox and decommissioning are huge market opportunities at the moment, but Government contracts are notoriously lengthy, complex and costly to bid. Without the right skills and stakeholder engagement, a company can quickly rack up huge expenses, with little chance of winning.
Mergers and Acquisitions
Again these can be costly and various studies show that over 70% are unsuccessful. Bringing a flexible, skilled and insightful resource into the process may cost a little more, but bring huge benefits in the long term.
Demand in the burgeoning water industry, especially around marketing and commercial operations is showing a real upturn. The domestic water market for the top users of this essential resource is now turning competitive like the electricity market, bringing new dynamics into play and fresh need for experienced interims working in energy.
Providing expert advice and assistance around programme implementation such as the Arrears Management Programme (AMP) is going to be crucial to ensure high standards of customer care and satisfaction are maintained during what will be a tumultuous period of reform in the industry
Are you one of the many interims working in energy? What is your experience of demand currently and the challenges in the sector? Share your thoughts and comments on interims working in energy with our community.