Average construction costs for electric utility facilities fell by only 0.4% over the first quarter
– By Abby Gessner –
PowerAdvocate, a leading provider of cost and market intelligence to the energy industry, released its 2Q2009 Cost Indices, which found average construction costs for electric utility facilities fell by only 0.4% over the first quarter of 2009. The Green Indices reported a slight decline of 0.8% in costs of renewable energy projects for the quarter. Over a third of the projects that PowerAdvocate tracks experienced cost escalation in the second quarter, indicative of a moderating economic climate.
Key themes from the quarter results include:
Early signs of recovery. Across the board, the Cost Indices show signs of costs stabilizing in the second quarter from the rapid decline witnessed over the past year.
Metals commodities increasing. Early indications suggest that the recent rise in metals prices is starting to trickle through to final costs of energy projects.
Utilities still aware of challenges. Determining if the signs of early recovery will encourage utilities to proceed with needed investment.
PowerAdvocate’s Construction, Operations & Maintenance, Green and European Cost Indices track market cost changes for the equipment, services, and materials used by the energy industry. The indices provide visibility and predictability into the key cost drivers for constructing and operating facilities in order to assist decision-makers in mitigating cost risk and in identifying savings opportunities.
PowerAdvocate’s Cost Indices include twenty unique project models, including renewables, fossil, and nuclear facilities as well as transmission projects. Utilities, developers, lending institutions, suppliers and governmental entities use the Cost Indices to examine the volatility of capital and O&M costs in today’s energy industry. The indices are released quarterly and are available through PowerAdvocate’s interactive and customizable Web-based application.
PowerAdvocate will be hosting a webinar for the PowerAdvocate Second Quarter Cost Indices Release on August 6th at 1pm EDT. Contact webinar@poweradvocate.com to register for this event.