Douglas Morris, who is part of Emerson’s alternative energy industry team, writes a follow-up to his recent post about the challenges alternative energy producers face when scaling up first of a kind technology:
In my last post, I discussed some of the financial hurdles alternative energy producers face to get their projects off the ground. In this post, let’s assume that the financing is in place and that producers are proceeding with building a new facility. Scaling up from lab or pilot scale to demonstration or commercial facilities is technically challenging and there aren’t many people to consult and ask, “How did you do this?”
Rather, one might say “I don’t know what I don’t know since no one has ever done this before.” There are many unknowns when scaling up and unfortunately, unknowns will often lead to increased project costs later. I’ve heard experts use different rules of thumb about the scaling process but the one that seems to hold true is that the first plant is going to end up costing two to three times initial estimates. Because of this, it’s imperative to use a portfolio of approaches to mitigate risk.
We all know there are many project risk categories, but I’ll touch on just one: schedule. Schedule risk comes in many flavors – expansion of original objectives, discovery of new requirements not originally foreseen, technical failure/re-start, plus many resource challenges such as managing suppliers and adding workers with the necessary skills and knowledge as construction progresses. All told, a focus on reducing schedule risk can help mitigate many other project risk factors.
There are some great project management books to help you assess, categorize, and minimize your risk portfolio. These are tried and true, but they also ask you to draw upon past project experiences and that can be a problem with a first of kind process. Recently, there have been some developments within Emerson that can address a portion of this schedule risk. In the way things are traditionally designed (and the way most control systems are designed), there is a major interdependency between software and hardware.
We know projects are schedule driven and with the accepted design process control system, hardware design can’t start without a specific database detailing the plant processes. As a result, databases are submitted that approximate the final design and designers are resigned to the fact that they’ll likely have to make changes later when the process design is complete. Although engineers have become quite good at estimating these databases based on past experience, this approach is less effective for alternative energy-related projects.
When scaling first-of-a-kind processes, engineers will often run into unanticipated issues that require process design changes. These in turn, require control system hardware and software changes. This is where the interdependency comes into play. One seemingly simple change flows through the engineering process requiring a fair amount of rework.
This engineering modification can cause the schedule to creep and the project cost to increase. To address the problems created by late project changes, electronic marshalling technology was developed and introduced, which removes this dependency between hardware and software. The end result is that you can make the inevitable process design changes throughout the project without much impact on schedule and cost due to rework.
Those looking to mitigate project schedule risk for these first-of-a-kind projects should take a closer look at how this technology removes many of the rework steps required in traditional automation system approaches.