Critical success factors for renewable energy projects; empirical evidence from Pakistan

doi:10.1016/j.jclepro.2018.05.274

Journal of Cleaner Production

Volume 195, 10 September 2018, Pages 991-1002

https://doi.org/10.1016/j.jclepro.2018.05.274 Get rights and content

Highlights

•
Identifying the significant success factors (SSFs) for renewable energy projects.
•
Categorizing the critical success factors (CSFs) into 5 clusters.
•
CSFs clusters: communication, team, technical, organizational & environmental factors.
•
Proposing a new model of CSFs to foster success in renewable energy projects.
•
Prioritizing the critical success factors for renewable energy projects.

Abstract

As the energy demands increasing globally, a lot of energy related challenges are evolving including global warming, energy sustainability and environmental pollution, which have forced countries to endorse renewable energy development policies proactively. As in result a lot of renewable energy projects are carried out around the world, which are facing numerous challenges and barriers, resulting in failure for many of recent projects. Although governments have launched several initiatives vis-à-vis renewable energy development in response, however such actions are limited to promote the renewable energy consumption, the implementation strategies for renewable energy projects and best practices are still overlooked. This study presents a systematical investigation on critical success factors (CSFs) affecting renewable energy projects. Through systematic process, a total of 41 significant success factors (SSFs) for renewable energy projects have been identified which are further extracted into 5 critical success factors (CSFs). In addition, CSFs have been prioritized through multiple linear regression analysis by SPSS 20, using the survey results of 272 firms working on renewable energy projects in Pakistan. Finally, a novel causal model is established to demonstrate the interaction mechanisms for ensuring success in renewable energy projects by the SSFs and CSFs. The results demonstrate that environmental factors are the predominant CSFs with highest correlation (0.592) which show the significant effect (33.8%) over project success. The findings not only help to understand the critical success factors for renewable energy projects in Pakistan, but also offer useful references for other countries that intend to promote renewable energy projects in the future.

Introduction

The development of renewable energy projects is continuously gaining momentum as part of the resolution to energy independence, as the requirement for energy is raising over the world, and with the dwindling reserve of fossil fuels. These projects offer numerous ecofriendly benefits besides providing electricity. Various projections indicate that renewable energy resources are currently the fastest sources of energy in the world, and these are expected to have enormous influence in the future (Jefferson, 2006, EIA., 2009).

The current study is an effort of the researchers to measure the effect of critical success factors (CSFs) in Pakistani renewable energy projects. Pakistan is among the energy deficient countries, which is trying to increase its indigenous energy supplies to deal with severe energy crises at present. Due to electricity shortage in Pakistan, the industrial sector has been severely affected and exports of the country have been declined particularly. Import of fossil fuel especially oil has put a lot of burden on economy of the country. In order to cope with energy crises and to meet the economic growth, Pakistan requires massive energy, mainly electricity. It is critical to secure affordable and ecofriendly sustainable energy for its more than 200 million people (Amer and Daim, 2011). Consequently, an increasing number of power plants will be constructed in order to meet the increasing electricity demand. In order to deliver effective institutional support for the development and deployment of renewable energy projects, government of Pakistan has launched two key departments i.e. Alternate Energy Development Board (AEDB) and Pakistan Council of Renewable Energy Technologies (PCRET). AEDB offers formal support, develops renewable energy policies and facilitates deployment of renewable energy projects in the country whereas PCRET conducts the research and development activities, develops pilot projects for demonstration purposes and train human resource so that they can work effectively and sustain renewable energy-based projects.

Pakistan has plenty of resources for renewable energy development, yet most of these have not been utilized appropriately. The renewable energy sources such as solar energy, fuel cell technology, wind energy, biomass energy, ocean energy, and geothermal energy can be exploited to control energy shortfall in Pakistan (Amer and Daim, 2011). Numerous renewable energy projects intended to overcome energy deficiency in the country are under construction such as; Quaid-e-Azam, Tricon Boston Corporation and Sany group wind projects; Quaid-e-Azam Park, Scatec, AJ Power, Access Electric, and Bukhsh solar projects; Eatihad Power Generation, RYK Energy, Indus Energy, Layyah Sugar Mills, Almoiz Industries, and Hamza Sugar Mills bagasse power projects; Biomass thermal power projects at Faisalabad, Islamabad and Karachi; and waste heat recovery power projects at Lucky Cement Ltd etc. In spite of significant requirement, these projects are undergoing several complications to successfully complete for instance; political, economical, technical, environmental and social aspects. Therefore, the present research was conducted to explore the most critical success factors in the renewable energy projects of Pakistan.

Though, many researchers have published their studies on the aspects of critical success factors for project management, none of these studies emphasize thoroughly on this context for renewable energy projects, specifically in Pakistani renewable energy projects. The key focus of this research is about the identification and assessment of significant success factors and then preferences of utmost critical factors anticipating to the accomplishment of renewable energy projects. The development of renewable energy resources in Pakistan has been assessed by many researchers. Nevertheless, their assessments were limited to potentials and predictions about the energy deriving from the renewable sources and its utilization. Only a few researches focused on the possible challenges and hurdles to the effective completion of renewable energy projects in Pakistan. Sahir and Qureshi (2008), for instance, recognize the barriers to the effective consumption of renewable energy potentials in the country. Mirza et al. (2009) examined the main issues to the progress of such projects. The research conducted by Chaudhry et al. (2009), addressed the imperative aspects of sustainable growth of renewable energy projects in Pakistan, nevertheless these aspects were restricted to theoretical recommendations only. None of these researchers have identified the significant success factors for renewable energy projects. Likewise, the critical success factors for renewable energy projects were also not described.

To fill this gap, this study proposes a model for identifying the significant success factors and clustering these factors into critical success factors (CSFs) categories, so as choosing the most important CSFs clusters that create successful renewable energy projects for both the energy firms and the government, by balancing the cost issues and environmental benefits. In view of the growing concern on the development of renewable energy globally, the findings of this study will support the energy firms and the public authorities to formulate effective strategies about the successful renewable energy projects to gain the maximum output.

Next session provides a brief description of critical success factors of constructing renewable energy projects towards project success and theoretical background on the linkage of project success with critical success factors. The model presented in the subsequent section hypothesized the influence of critical success factors on project success. The empirical investigation is based on the industry sample of 272 medium and large-sized construction and engineering firms working on renewable energy projects in Pakistan. Data was collected from each firm using a standardized questionnaire. The empirical results were presented after a description of the research setting and employed methods. The findings of the study conclude with a discussion and further limitations and avenues for the future research.

Section snippets

Literature review

A number of significant factors combine to decide the success or failure of a renewable energy project in terms of its objectives (i.e., time, cost, and scope). The identification of the critical success factors for these objectives will lead to effective resources distribution. The CSFs can be determined based either on expert opinions or on quantitative measures (Chua et al., 1999).

Research methodology

The methodology recommended by Saunders et al. (2015) was followed for present research, which comprises of 7 steps. Post-positivism was extracted as epistemological viewpoint, since it means that objectivity is a superlative, but is conscious about subjectivity deriving from the subject consider for information gathering. According to Biedenbach and Müller (2011), post-positivism distinguishes trends as an alternative of generalizations. A deductive method was utilized for an effective

Data analysis techniques

Data analysis comprises of data screening, descriptive analysis, and respondents’ demographics statistics, assessing data reliability and analyzing the correlation. Correlation and regression analysis were used to test the study hypotheses. Correlations and regression analysis were studied through SPSS 20.

Data screening, reliability, and validity of the data

Before starting data analysis, the survey data was vigilantly checked for outliers, missing values, normality, and multicollinearity. It was found that not a single value fell beyond the

Theoretical findings

The findings of the current research lead to report a strong understanding towards identification of CSFs and their association with the success of the project. The paper makes some important contributions. It: (1) identifies the significant success factors for renewable energy projects in relevant literature for the first time; (2) categories the significant success factors into five CSFs clusters; communication factors, team factors, technical factors, organizational factors, and

Conclusion

The risks of inevitable, disastrous repercussion of human-persuaded global warming have concerned world's policymakers and governments to called for affirmative actions. In the twenty-first Conference of the Parties (COP21) to the United Nations Framework Convention on Climate Change (UNFCCC), which held in Paris in December 2015, 195 countries have consensus to do actions with the aim to reduce global greenhouse gases emissions to restrict global temperature rise to 2 °C. Since then most of

References (64)

S. Ahmed et al.
A comparative review of China, India and Pakistan renewable energy sectors and sharing opportunities
Renew. Sustain. Energy Rev.
(2016)
M. Amer et al.
Selection of renewable energy technologies for a developing county: a case of Pakistan
Energy Sustain. Dev.
(2011)
W. Belassi et al.
A new framework for determining critical success/failure factors in projects
Int. J. Proj. Manag.
(1996)
N. Carbonara et al.
Public-private partnerships for energy efficiency projects: a win-win model to choose the energy performance contracting structure
J. Clean. Prod.
(2018)
J.S. Chou et al.
Cross-country comparisons of key drivers, critical success factors and risk allocation for public-private partnership projects
Int. J. Proj. Manag.
(2015)
D. Dvir et al.
In search of project classification: a non-universal approach to project success factors
Res. Pol.
(1998)
Y. Fang et al.
Balancing energy and environment: the effect and perspective of management instruments in China
Energy
(2007)
L.A. Ika et al.
Critical success factors for World Bank projects: an empirical investigation
Int. J. Proj. Manag.
(2012)
M. Jefferson
Sustainable energy development: performance and prospects
Renew. Energy
(2006)
E.Y. Li
Perceived importance of information system success factors: a meta analysis of group differences
Inf. Manag.
(1997)

U.K. Mirza et al.

Identifying and addressing barriers to renewable energy development in Pakistan

Renew. Sustain. Energy Rev.

(2009)

R. Muller et al.

Leadership competency profile of successful project managers

Int. J. Proj. Manag.

(2010)

M.H. Sahir et al.

Assessment of new and renewable energy resources potential and identification of barriers to their significant utilization in Pakistan

Renew. Sustain. Energy Rev.

(2008)

F. Shaikh et al.

Prospects of Pakistan–China energy and economic corridor

Renew. Sustain. Energy Rev.

(2016)

A.A. Tofigh et al.

Analysis of energy status in Iran for designing sustainable energy roadmap

Renew. Sustain. Energy Rev.

(2016)

O.I. Tukel et al.

Analysis of the characteristics of projects in diverse industries

J. Oper. Manag.

(1998)

G.D. Valasai et al.

Overcoming electricity crisis in Pakistan: a review of sustainable electricity options

Renew. Sustain. Energy Rev.

(2017)

D. White et al.

Current practice in project management—an empirical study

Int. J. Proj. Manag.

(2002)

R. Xavier et al.

Participatory governance in the transformation of the South African energy sector: critical success factors for environmental leadership

J. Clean. Prod.

(2017)

P. Xu et al.

Success factors of energy performance contracting (EPC) for sustainable building energy efficiency retrofit (BEER) of hotel buildings in China

Energy Pol.

(2011)

R. Young et al.

Top management support—almost always necessary and sometimes sufficient for success: findings from a fuzzy set analysis

Int. J. Proj. Manag.

(2013)

Z.Y. Zhao et al.

Critical factors affecting the development of renewable energy power generation: evidence from China

J. Clean. Prod.

(2018)

Z.Y. Zhao et al.

Critical success factors for BOT electric power projects in China: thermal power versus wind power

Renew. Energy

(2010)

J. Andertson et al.

Structural equation modeling in practice: a review and recommended two-step approach

Psychol. Bull.

(1998)

D. Baccarini et al.

Critical success factors for projects, surfing the waves: management challenges; management solutions

B.N. Baker et al.

Factors Affecting Project Success. Project Management Handbook

(2008)

Y.T. Bayiley et al.

Success factors and criteria in the management of international development projects: evidence from projects funded by the European Union in Ethiopia

Int. J. Manag. Proj. Bus.

(2016)

T. Biedenbach et al.

Paradigms in project management research: examples from 15 years of IRNOP conferences

Int. J. Manag. Proj. Bus.

(2011)

D.A. Buchanan et al.

Power, Politics, and Organizational Change: Winning the Turf Game. London

(2008)

M.A. Chaudhry et al.

Renewable energy technologies in Pakistan: prospects and challenges

Renew. Sustain. Energy Rev.

(2009)

D.K.H. Chua et al.

Critical success factors for different project objectives

J. Construct. Eng. Manag.

(1999)

EIA

International Energy Outlook. Energy Information Administration. U.S. Department of Energy

(2009)

Cited by (65)

Renewable energy public-private partnership projects in Egypt: Perception of the barriers and key success factors by sector
2023, Alexandria Engineering Journal
Given its location, Egypt has a tremendous potential for renewable energy resources such as wind, solar, and hydropower. On the other hand, renewable energy projects require huge upfront costs which makes it difficult for the Egyptian government to fulfill. Thus, renewable energy projects in Egypt are conducted in the form of public–private partnership (PPP) projects to take advantage of the private entity’s financial support. Thus, this study focuses on studying and analyzing renewable energy PPPs in Egypt using a questionnaire survey. First, the main barriers and keys success factors (KSFs) were identified by collecting previous studies in the area to build the survey. The survey was then created and disseminated to experts involved in renewable energy PPPs in Egypt. A total of 25 responses were collected from experts in the public and private sectors. The results show that the main barriers for renewable energy PPPs in Egypt are regulatory and political barriers, while well prepared contact documents and skilled and efficient parties are the main KSFs. Additionally, the different sectors perceive the barriers and KSFs differently. Finally, the results show that unlike the public sector, the private sector is efficient in identifying and valuing risks appropriately.
Economic and environmental factors of wind energy deployment in the United States
2023, Renewable Energy Focus
Among the most promising clean energy sources in the electricity market, wind energy has substantially increased its share in the global energy portfolio. Since 2000, the installed wind energy generation capacity in the United States has been multiplied by 50, from 2,377 megawatts to 117,744 megawatts in 2020. We investigate the economic and environmental factors that have relationships with the wind energy generation capacity growth in the United States between 2000 and 2020 using fixed-effects panel data analysis. Economic factors include gross state product, the value of the agricultural sector, and the unemployment rate. Environmental factors include carbon dioxide emissions, nitrogen oxide emissions, and water use. The empirical findings provide strong evidence that in the United States, an increase in economic factors (except unemployment) is related to a significant increase in the installed wind energy capacity. In contrast, the relationship between the air emissions and installed wind capacity is negative. The results for water use are not reported in the current study as these data did not satisfy all fixed-effects panel data analysis assumptions. These findings are expected to contribute to understanding how states might best stimulate and support wind energy deployment.
Solar energy and the circular economy policies for sustainable management
2023, Solar Energy Harvesting, Conversion, and Storage: Materials, Technologies, and Applications
Solar energy sustainability concerns include equal and fair access to renewable energy, energy saving, energy security, energy waste minimization, energy efficiency, and greenhouse gas emission reduction at the regional and international levels, which cannot be resolved entirely unless the urban solar energy system incorporates circular economy and sustainable management policies. This cooperation will enable the urban energy system to address key sustainability issues while also capitalizing on opportunities. Unfortunately, there is a scarcity of literature focusing on circular economy and sustainable management policies for solar energy sustainability in urban settlements. This chapter investigates how solar energy resources can be handled more sustainably through the circular economy and sustainable management policy through better environmental layout, solar energy planning, urban energy infrastructure processing, reusability, and fewer energy spillages to enhance economic, social, and environmental benefits.
How to plan for success? An exploration of social context factors in neighbourhood energy planning
2022, Energy Research and Social Science
It is essential to consider the social context when designing sustainable energy systems that lead to successful implementation in neighbourhoods. Current methods often only consider techno-economic aspects and are insufficiently capable of including social factors, because they are unclear about which social factors are relevant and how they can be quantified. This paper explores how neighbourhoods can be characterized socially by studying pre-existing neighbourhood characteristics, focussed on socio-economic status and social cohesion. The paper is built around four case-studies in the Netherlands, which are analysed both quantitatively and qualitatively. The paper shows how the social context can be defined by 1) proposing a theoretical framework of social factors, 2) quantifying these social factors by survey research, 3) interpretating this data using qualitative case-study data and 4) quantifying success in the cases and relating this to the scores of the survey data. The results of this explorative study will 1) show how a social profile can be used to find leads for a participative approach towards sustainable neighbourhoods where techno-economic solutions are well embedded in the social context and 2) help to understand and predict success of participation in communities.
Systematic analysis of factors affecting biogas technology acceptance: Insights from the diffusion of innovation
2022, Sustainable Energy Technologies and Assessments
Citation Excerpt :
The rapidly rising energy demand, depletion of natural resources, and increasing ecological threats compel the country to address the importance of power generation via renewable resources [1]. The growth of biogas technology (hereafter denoted as Bio-Tech) in Pakistan is affected by many crucial factors [2]. Studies on these factors have been attracting the attention of various scholars, policymakers, and practitioners.
The energy shortfall and escalating energy demand in developing countries require emergent alternatives to cope with the situation. In this regard, biogas technology (Bio-Tech) may assist in meeting the increasing energy demands. This research comprehensively reviews the literature on the driving and inhibitory forces of biogas acceptance. As a further step, a questionnaire survey is conducted to examine the respondents’ perception-based impact factors of Bio-Tech acceptance under the five dimensions of Roger's model. The obtained responses are analyzed and interpreted to identify the driving and inhibitory forces affecting Bio-Tech acceptance. Based on the findings, first, grid connection independency is revealed to be the most important driving force of Bio-Tech acceptance according to the users and non-users of biodigesters. Second, the respondents agreed that social approval was an important contributing driving force. Third, energy safety is proven to be another major driving force. In addition, the high rates of conventional energy; uninterrupted electricity supply; best energy alternative; positive word of mouth; financial feasibility; trial options, such as “money-back guarantee”; environmental amicability; and the sustainability-based behavior of the respondents are declared to be among the significant driving forces of Bio-Tech acceptance. Concerning inhibitory forces, first, the frequent maintenance of biodigesters is found to be the most significant. Second, the long payback period is exposed to be a critical inhibitory force. Third, the lack of ease of access to biogas-based local markets and the inaccessibility of experts are indicated as significant inhibitory forces. Moreover, the complications in handling the new technology, inadequate incentives, applicability to limited energy appliances, reconstruction of houses, drop in efficiency, escalated installation cost, and energy supply insufficiency are established to be vital inhibitory forces of Bio-Tech acceptance at the respondent level.
Exploring the role of organizational support, and critical success factors on renewable energy projects of Pakistan
2022, Energy
Citation Excerpt :
Nevertheless, only a few empirical studies have addressed this issue, specifically in renewable energy-based projects. In this regard, the studies of Khan, Mirza [5], and Maqbool and Sudong [53] are highly relevant to our study. The findings of their studies also suggest CSFs positively affect PS.
This study investigates the relationship between critical success factors (CSFs), organizational support, and renewable energy project success. The critical success factors with multiple dimensions (communication, team, technical, and environmental) were used in this paper. This study adopts the questionnaire survey approach, and collects data from the construction based renewable energy projects located in Punjab Province, Pakistan, which comprised 342 valid samples. Partial least-squares structural equation modelling (PLS-SEM) was used to analyze the theoretical framework. The results confirmed that three critical success factors i.e. team factors (TF), technical factors (Tech. F), and environmental factors (EF), have a positive and significant direct relationship with project success. However, communication factors (CF) have a direct but insignificant relationship with project success. Moreover, results also confirmed the positive mediating role of organizational support between critical success factors and project success. The empirical outcomes of this study show that these four critical success factors increase the success of renewable energy projects. The outcomes also show that organizational support as a mediating variable plays a dynamic role in enhancing the tangible success of renewable energy projects. This study contributes through empirical findings in the existing knowledge base for renewable energy projects.

View all citing articles on Scopus

View full text

Critical success factors for renewable energy projects; empirical evidence from Pakistan

Highlights

Abstract

Introduction

Section snippets

Literature review

Research methodology

Data analysis techniques

Data screening, reliability, and validity of the data

Theoretical findings

Conclusion

Renew. Sustain. Energy Rev.

Energy Sustain. Dev.

Int. J. Proj. Manag.

J. Clean. Prod.

Int. J. Proj. Manag.

Res. Pol.

Energy

Int. J. Proj. Manag.

Renew. Energy

Inf. Manag.

Renew. Sustain. Energy Rev.

Int. J. Proj. Manag.

Renew. Sustain. Energy Rev.

Renew. Sustain. Energy Rev.

Renew. Sustain. Energy Rev.

J. Oper. Manag.

Renew. Sustain. Energy Rev.

Int. J. Proj. Manag.

J. Clean. Prod.

Energy Pol.

Int. J. Proj. Manag.

J. Clean. Prod.

Renew. Energy

Structural equation modeling in practice: a review and recommended two-step approach

Psychol. Bull.

Critical success factors for projects, surfing the waves: management challenges; management solutions

Factors Affecting Project Success. Project Management Handbook

Success factors and criteria in the management of international development projects: evidence from projects funded by the European Union in Ethiopia

Int. J. Manag. Proj. Bus.

Paradigms in project management research: examples from 15 years of IRNOP conferences

Int. J. Manag. Proj. Bus.

Power, Politics, and Organizational Change: Winning the Turf Game. London

Renewable energy technologies in Pakistan: prospects and challenges

Renew. Sustain. Energy Rev.

Critical success factors for different project objectives

J. Construct. Eng. Manag.

International Energy Outlook. Energy Information Administration. U.S. Department of Energy