A re-assessment of how pre-feasibility studies are conducted, why they exist, and if they are truly serving their need.
“As companies attempt to comply with new obligations, they will need to grapple with how they can effectively change their current business strategies, operating models, and financing plans.
If business leaders proactively consider and respond to the evolving landscape of new regulations, they will be better equipped to turn the challenges they face into catalysts to unlock opportunities and drive business value.”
“EU Regulation Drives The Sustainability Transition,” Deloitte, 2023
Sometimes it’s difficult to remember that the way things have always been done isn’t the same as the way things should be done. Relative to the pre-feasibility study, remembering the difference between the two sparked a key component of OVR-VU: dynamic updates.
This idea began when we acknowledged that current methods for assessing feasibility, optimization, design, and implementation are high-risk for developers, REITs, energy companies, municipalities, community development organizations, and any other relevant organizations. There are two reasons for this: fixed results and human-led assessment.
Problem 1: Fixed Results
The results of current approaches to pre-feasibility studies do not adjust on the basis of changing market conditions, regulations, interest rates, energy prices, and other relevant shifts.
If projects had short time horizons, this might be acceptable. However, the average project can last anywhere between 13 months and 10 years. In this time, we can say with absolute certainty that market conditions, regulations, interest rates, energy prices, and other relevant considerations will significantly shift. In fact, for perspective, over 1,255 new sustainability regulations have been enacted since 2011, representing a 155% increase.
Problem 2: Human-Led Assessment
Limited time, resource, and capacity constraints - rooted in the current manual ‘human-led’ process for developing pre-feasibility studies - lead to results that are potentially static, non-comprehensive, and non-optimized. In addition, they further exacerbate existing bottlenecks in the path to decarbonize.
The standard approach is to pinpoint 2-3 scenarios of the almost limitless possibilities and assess these. While this provides some degree of analysis, it does not unlock actionable and bankable renewable energy solutions that maximize value, streamline the development process, de-risk the investment, and decarbonize the built environment.
Our Solution: Dynamic OVR-VU
As a response to the problems caused by fixed results and human-led assessment, OVR-VU’s pre-feasibility study includes quarterly updates of the optimized recommendations based on changing regulations, interest rates, energy prices, resource availability, and more. This maintains the relevance of the optimized recommendation across the project’s entire timeline.
In addition, OVR-VU’s automation allows it to consider far more than 2-3 scenarios, so it regularly re-evaluates the chosen recommendation to ensure it is still the optimal solution, thereby de-risking and maximizing value.
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