Safeguarding procurement management
The challenge
A power transmission system operator was increasingly confronted with supply bottlenecks, particularly in the procurement of critical technical components needed for both new-build and expansion projects. There were various reasons for this:
- previous contracting models were no longer appropriate for the current market situation
- mounting demand but limited choice of suppliers
- shifts in the focus of demand in the global markets
- volatile prices make procurement more difficult.
In addition, there are internal challenges that have to be managed in the context of grid expansion and rapidly escalating investment volumes:
- Staff numbers need to be substantially increased and aligned with changing qualification requirements.
- New technologies and products — such as innovative insulation materials in cable construction — must be mastered and factored into project execution.
Resilient procurement management is required for timely realization of core grid expansion projects to ensure a successful energy transition.
The solution
FMC provided support with comprehensive analyses and a strategic concept for stabilization of procurement: First of all, we examined the procurement strategies with regard to their sustainability and needs-based orientation. As part of this process, procurement timing and the supplier portfolio were also examined in detail. We likewise reviewed the possibilities for adapting proven FMC best practices and presented concepts for their application — always with the aim of rendering our client’s procurement more flexible and exploiting economic potential to the full.
The conclusion
Transmission system operators play a pivotal role in the energy transition. In view of the enormous expansion requirements and tight completion deadlines, stabilizing measures in our client's procurement process were unavoidable. With our unique combination of market expertise and technical know-how, we have made a significant contribution to safeguarding procurement strategies.
