Insights

"Everybody has a plan until they get punched in the mouth."

When Iron Mike Tyson delivered this brutal truth, he was talking about the boxing ring. But it applies just as much to project development. No matter how solid your plans, unexpected blows will come. Community opposition, permit denials, regulatory shifts, market volatility, supply chain disruptions… any one of these could be the punch that knocks your project off course.

The good news? You can roll with those punches and keep standing. At THAMPICO, we've cracked the code by focusing on one goal: shortening the preconstruction cycle.

Why does this matter so much? Imagine you're squaring off against prime Tyson himself. The longer the fight goes, the more chances he has to land a knockout blow on you. Similarly, when the preconstruction phase drags on, each passing day raises the risk of an internal or external obstacle derailing your project.

So how can you blitz through preconstruction and get your project over the line before catastrophe strikes? Start with these three power moves:

1. Find Your Project's Ali

Traditionally, project managers were engineers first, learning the rest of the job on the fly. But with our ability to outsource design/engineering these days, the ideal PM is a renaissance person.

You need someone who can juggle every workstream- communications, human resources, finance, permitting, you name it. Look for PMs with broad knowledge and experience spanning multiple disciplines. They'll have the agility to keep all those balls in the air while relentlessly advancing toward the finish line.

2. Stick and Move

How many project meetings have you attended where there's no clear agenda, spotty notetaking, and a lack of cohesion? That might work for small teams, but as your organization scales, chaos ensues.

Instead, get disciplined about communication from the start. Establish standing meetings with set agendas that cover all critical issues. And make reporting meetings standardized - a regular forum for the PM and team to share progress and field questions from leadership. When everyone stays looped in and aligned, the whole operation runs tighter.

3. Unleash a Tech Knockout

Are you utilizing a patchwork of various software programs based on the prior experience of their project team members? As you grow, that fragmented approach will weigh you down.

Here's a suggestion: Implement a robust Project Management Information System (PMIS) from pre-construction. But don't just look for software that fits your current processes. This is your chance to find a true platform for optimizing your future vision. It requires a thoughtful discovery process but lands you with streamlined project execution across your whole operation.

Between the right PM, finely-tuned communication, and your software force-multiplier, you're creating a lean, agile strike team to deliver projects rapidly. One that can slip any punch and still arrive at the intended destination: on-budget, on-time success.

Want to see how THAMPICO can get your project development process into prime fighting shape? Schedule a free consultation today.

As energy project developers ramp up to meet the soaring demand for reliable, affordable, and clean power, a strong Project Management Office (PMO) isn't just nice to have, it's the backbone of a successful project delivery shop. But PMOs need time to mature and develop their full potential.

Think of your PMO like your project GPS. It doesn't just give you directions; it reroutes you when there's traffic, alerts you to hazards, and helps you reach your destination faster and safer. But just like GPS apps, not all PMOs are created equal; some are still printing out MapQuest directions.

In this blog, we explore the stages of PMO maturity, share examples from energy sector organizations, highlight the KPIs that reveal where your PMO stands, and offer tips for upgrading from chaos to clarity.

Stages of PMO Development: A PMO's evolution usually follows five maturity levels:

1. Initial (Ad Hoc): This is the "wild west" phase. Picture a utility company managing projects on spreadsheets; there's no standard method, and everyone's winging it. No formal structure exists, and projects run on different tracks with different rules. Success hinges on individual heroes pulling all-nighters to save the day.
2. Developing (Emergent): You've recognized there's a better way. There's an awareness that centralization would help. A PMO is formed and starts taking its first wobbly steps. Some templates and tools are in place, but getting everyone to use them is like asking cats to march in formation.
3. Defined (Standardized): Now the PMO is up and running. Project delivery methods are standardized, and everyone's playing by the same playbook. You're collecting data, even if you're not always sure what to do with it yet. Southern California Edison, for instance, saw major benefits after establishing a PMO that standardized how large infrastructure projects were scoped, staffed, and reported.
4. Managed (Integrated): The PMO now links to enterprise platforms. Real-time data flows in. Risks and resources are monitored, and there's a feedback loop to improve future projects. Organizations like Duke Energy are using integrated systems to support grid modernization initiatives.
5. Optimized (Strategic): The PMO is now the strategic brain of the organization, powering decisions across your portfolio like a high-efficiency turbine. Initiatives are prioritized based on strategic alignment, and continuous improvement isn't just a buzzword, it's the definition of how you operate.

Transitioning to a Strategic PMO Moving from a reactive to a strategic PMO is about building the right mix of people, process, and technology.

• People: Invest in professionals who understand both utility operations and structured project delivery.
• Process: Introduce standard lifecycles, gate reviews, and clear handoffs. Think of it like a relay race: everyone knows when and where to pass the baton.
• Technology: Use modern PMIS tools that give you dashboards, forecasting, and scenario planning. If you're still updating status via email, it's time to level up.

At a time when utilities and energy developers are tasked with doing more, faster, and with greater accountability, your PMO can be the difference between barely keeping up and confidently leading the charge. The question isn't whether you need a PMO- it's how fast you're willing to get there.

Last week, our team attended a series of workshops at the RE+ Conference in Las Vegas, Nevada. We focused on workshops around energy storage, green hydrogen, and the electric grid, as these areas are of critical interest to our utility clients. One of the workshops that our program manager, Evan Heryet, attended was titled "Interconnection Innovation Workshop." Here is Evan's recap of the workshop.

Amongst the renewable energy landscape, and the broader distributed energy resource (DER) arena, there is a push to increasingly develop and connect new electric generation projects throughout the North American electric grid ( Bulk Power Supply or BPS ). At the connection point between the generation project and the transmission network (interconnection), a bottleneck has formed, resulting in a significant backlog of new generation project applications.

To cope with the new challenges posed by new types of electric generation technology and alleviate the interconnection application and processing times, the U.S. Department of Energy has gathered a diverse group of stakeholders throughout the BPS ecosystem aiming to come up with an effective 5-year strategic roadmap. The roadmap aims to implement rules for faster and fairer interconnection processes as well as rules for enhancing the reliability, resiliency, and security of the distribution and transmission grid networks. Key issues to be addressed are cost allocation, queue management, data transparency, equity, workforce, and grid engineering practices.

The reality is that in such a diverse ecosystem, with a significant number of differing interests, there is no elegant solution—but progress is being made.

Recently the Federal Energy and Regulatory Commission (FERC) issued Order 2023 to address interconnection queue backlogs, improve certainty, and prevent undue discrimination towards new technologies. Although Order 2023 is a promising start, a push from federal regulators and lawmakers will be needed to address further issues.

Areas that still need to be addressed include portions of the BPS outside of the Transmission Wholesale Power Markets, regional differences in standards including a lack of definition for transmission, sub-transmission, and distribution systems, challenges in terms of reliability brought on by DERs, and a lack of access to and transparency in data.

Tied to a loosely standardized, haphazard approval process that is implemented regionally and varies even at the individual utility level, the process can be confusing to say the least, and subsequent modeling for projects can have large unknowns. To address and alleviate these issues by the year 2030 is going to take quick, careful, and decisive action by the Department of Energy in collaboration with FERC and numerous other stakeholders.

These parties will need to address key issues such as:

• Holistic grid planning
• Meeting the current and upcoming demand for qualified engineers
• Top down and bottom up planning overall
• Stakeholder access to historical and current data such as project failure rates, areas of grid congestion and generation opportunities, etc.
• Alleviate exploratory applications from developers due to lack of data

How are your vendors performing?

A simple, seemingly innocent question that might result in some quizzical glances, depending on whom you ask.

Surely, someone in procurement will have the answer, right? But procurement doesn't work with your vendors on a daily basis; their only interactions are related to contracting with, onboarding, or offboarding your vendors.

Someone in project management will have the answer, right? But if they do, it's largely anecdotal. You'd have to go ask each team member individually what they think, and those answers are usually qualitative and vary from person to person.

We believe there's room for improvement in how organizations work with vendors. After all, vendor management IS a critical part of project management.

Yes, project management also entails scope, risk, schedule, budget, and quality management.

But given the extent to which project activities are outsourced these days, project management largely involves identifying, selecting, contracting with, and managing suppliers of equipment and services to achieve project objectives. This is especially true for smaller organizations, where it isn't always cost effective to hire in-house.

Project management often works closely with procurement for vendor selection. In a sense, this is just one more activity that the project management team is outsourcing- albeit to an internal entity, not an external one. For some organizations, this working arrangement is very formal and rigid; for others, less so.

Regardless of how a vendor is identified, selected, and contracted, once the vendor is onboarded, they can start providing the requested equipment or services. And that's largely the extent to which most organizations are doing vendor management today: simply having a process in place to select the right vendors, ideally in a timely and cost-effective manner.

But is that really sufficient?

I said earlier that vendor management is an important part of project management, but let's consider the other parts of project management. Take schedule management for example. What if we exerted all our effort on creating a schedule, and then didn't spend any effort our tracking or trying to improve our performance against the schedule? Surely this approach would not produce good results for the project's schedule performance.

Extending that analogy to vendor management: if we don't know how our vendors are performing, how do we know that we selected the right vendors in the first place? If the information is simply anecdotal, then it's unlikely that it is being fed back into the initial selection process to guide the procurement and project management team when they make decisions on selecting future vendors.

A vendor is only as good as their work (or products). And the only way to determine if their work is good is if it is measured during performance.

We understand there are a number of challenges with vendor performance management, stemming from the broad range of vendors and suppliers which can make it difficult to perform relative comparisons, to the lack of dedicated software for vendor performance management.

At THAMPICO, we believe that the best way to evaluate your vendors is by building a dedicated process into your own project management software platform. We have experience integrating vendor performance into the leading PMIS platforms. Most importantly, we know how to build a sustainable, transparent, and customized vendor performance management process so that it ends up being utilized as intended by your project and procurement teams.

Ready to take your vendor management to the next level? Contact us today to learn how we can help you integrate a robust vendor performance management process into your project management framework. Let's work together to ensure your vendors deliver the products and services you need to achieve your project goals.

This is the first in a series of posts about this subject. The objective of this post is to provide some information to help owners, developers and contractors evaluate and select the appropriate Project Management Information System or PMIS, also called Project Management/Construction Management (PM/CM) or Construction Project Management (CPM) software.

Before jumping into it, I want to point out that this content was created by the humans at THAMPICO, and not by ChatGPT or any AI tool—for better or worse. We acknowledge that a lot of what you are going to hear is based on our subjective experience as former and current users of PMIS software.

The annual license fee for a PMIS can approach several hundred thousand dollars. And that's just the hard cost (i.e., money that is spent directly by the purchasing organization). If you include the time it takes for staff to learn and use the system, the soft costs can extend into the millions of dollars.

That is why it is critical for organizations to select the right PMIS. The right PMIS can mitigate risk, reduce costs associated with errors, save money that would otherwise be spent on contingencies, and potentially avoid or minimize the likelihood and costs of lawsuits. Furthermore, the sooner a project is completed, the faster the owner can begin generating revenues which could go towards paying back debt, thereby satisfying investors and providing the means to develop even more projects.

Unfortunately, there is a lack of information and resources to help organizations make the right decision about what PMIS system they should select. Most of the public information comes directly from the developers of the software. They're not always the most partial providers of information.

There are several third-party websites that compare different systems, but these websites rely on information from the software developers or anecdotal information that is difficult to validate. These websites may also be receiving fees for recommending certain systems.

Any evaluation of PMIS software requires knowledge of construction project management and software systems. While most construction project managers have extensively used software over the course of their careers, they're usually not experts when it comes to choosing which software. Conversely, it's rare to find a software expert with experience or expertise in construction project management. The career paths for these two fields generally do not intersect.

One way for organizations to address this gap is to form a PMO, or Project Management Office, with staff that bring a combination of software and construction management experience. The PMO can then be tasked with driving the evaluation and recommendation of the PMIS software for the organization. We work with PMOs to help them make the optimal choice of a PMIS system.

Now, the question may come up: what if we've already selected a PMIS system, but it isn't the right fit for our organization?

Something that stuck with me from my MBA program is:

"You make the best decision you can with the information you have; once the decision is made, you must work to make it the right decision."

(Credit: Professor Carl Voigt at USC's Marshall School of Business).

That being said, you are also aware of the concept of sunk costs. If your organization ultimately determines that a incorrect decision has been made, it's appropriate to cut your losses and move on to a better solution.

The good news is that most PMIS software is sold on an annual license basis, since software providers today prefer to be in the SAAS (Software-as-a-Service) business. But there can be high costs of switching to a different PMIS.

As such, before deciding to explore or acquire a new PMIS, it may be better to see whether changes in the areas of people and process could help your organization make better use of the technology, rather than changing the technology to try and fit your people and process. The PMO, working with dedicated and knowledgeable consultants, can help you make the determination of the best path forward.

That concludes the first post in the series. I hope it piqued your interest enough to read the next one, which is titled "The PPB Framework: Project-Level Systems":

In this post, I will discuss a simple framework to help us evaluate PMIS software. The acronym we use is PPB, which stands for " Project + Program + Business."

It is a simple framework; while consultants like me love complexity (because we make money from solving complex issues and problems), a simple approach will serve us better here.

As you hear the description of each level, ask yourself where your organization currently stands. Does your organization need a Project (Level 1) system? Or are you ready for a Program (Level 2) or Business (Level 3) system?

The first level is Project. Every PMIS addresses project management to some degree. Here are some ways in which they do so:

1. They provide the means to store, organize and share project information. Here's what you will likely find with most systems on the market today.

a. The data is stored in the cloud, so it can be accessed from anywhere. Some systems even allow the user to download information and view it offline.

b. The information is stored in a folder structure that can be duplicated across projects or for new projects, typically by creating a template project.

c. There is some degree of access control, so users will need permissions to access certain files. This helps when working with external vendors in the same system.

2. They provide tools to capture workflows, which are the processes that an organization follows to develop projects.

a. These tools may include desktop and field tools, the latter of which are largely for mobile users since construction sites are better suited for mobile devices.

b. The workflows may come pre-packaged or need to be customized. Each organization has different needs as far as workflows. An organization that relies significantly on external vendors such as contractors may have more complicated workflows. Some systems allow for collaboration with vendors or even allow vendors to work within the same system.

c. As with the file storage functionality, workflows may be permission or access based, so that different users have access to different workflows depending on their role on the project.

3. They allow for management of cost, schedule, quality and scope at the project level.

a. Cost: PMIS system capabilities range from providing tools for manually entering project financial information to full integration with accounting systems with budgeting, forecasting, invoicing, and more.

b. Schedule: PMIS system capabilities range from providing a place to upload a schedule developed in more specialized scheduling software, usually Primavera P6 or Microsoft Project, to creating a dynamic schedule with interdependencies between tasks.

c. Quality: PMIS systems can include emails, meetings, drawing management, RFIs, submittals, and other tools to address project quality.

d. Scope: PMIS systems can include contract management, change management, purchase orders, and other tools to address project scope.

Here are five questions to ask as you evaluate different Project- level PMIS platforms as well as your organization's readiness for this kind of system. The answers to these questions may dictate the kind of system your organization requires.

1. Does your organization have set processes? If so, certain systems may be better than others.

2. How complex are these processes? If you work with a lot of different vendors, you may benefit from a more collaborative tool.

3. How well do your project team members follow these processes? If the answer is not well, then just getting them onto the same system can be a challenge as well as a huge opportunity for the organization.

4. Do you have an individual (or individuals) within the organization who will oversee and administer a comprehensive project management tool? If not, then who would be accountable for the successful integration and utilization of this tool?

5. How much time do your projects spend in pre-construction versus construction? Certain systems are more flexible than others and thus may be easier to adapt for pre-construction activities.

A Project- level PMIS is like a toolbox with the essential tools required to do the job. Almost every toolbox will have these tools, although they may differ in how they look and feel. A competent builder can use these tools to get the job done even if the builder may have prior experience using different tools.

To read about the next level of PMIS software, click here:

In this post, I will continue the discussion of the PPB framework to help evaluate PMIS systems. Following the first level, Project, the second level is Program, also sometimes referred to as Portfolio. A program refers to a group or collection of projects. Here are some of the ways these systems address program management:

1. Aggregation

These systems will aggregate the data from different modules at the project level and publish it in the form of reports or dashboards.

The data may come from the project management, bidding, financial, administrative, or other modules. One example would be a single table showing the budget versus spend to date for all projects in the system.

2. Reporting

These systems will provide canned or pre-populated reports which consist of the most frequently requested views as well as the ability to create custom reports for the user's desired views.

Data may come from a single module (e.g., budget versus spend across projects) or a cross-section of modules (e.g., change orders by vendor for a specific project). The reports can be set up for distribution via email to different users at a scheduled interval. Data can also be exported to a flat file such as a.csv which can then be used in Excel or a visualization tool like Tableau to drive insights.

3. Analytics

These systems either have built-in analytics capabilities or integrate with analytics software such as PowerBI to provide detailed views on aggregated data from different projects.

Analytics tools are typically highly configurable and provide real-time views based on selected metrics and parameters. Organizations that are already using PowerBI might benefit from the integration with their PMIS.

Here are five questions to ask as you evaluate different Program- level PMIS platforms as well as your organization's readiness for this kind of system. The answers to these questions may dictate the kind of system your organization requires.

I. What type of reporting do you need? Are these reports being generated for an internal audience or an external one? What format do the reports need to be in and how are they distributed?

II. How frequently do the reports need to be produced and how recent does the data need to be? If changes don't occur very frequently in your projects, then real-time information may not be required for your distribution list.

III. Is your organization already leveraging project and portfolio data? Do you use any of the popular analytics and visualization software on the market, such as PowerBI or Tableau?

IV. Do you have an individual (or individuals) within the organization who would oversee and manage the portfolio using this system? Ideally this would be the role of an executive in charge of development or a program manager, someone tasked with reviewing the data, capturing and sharing insights, and using the information to make decisions.

V. Do you have established risk management, lessons learned, or continuous improvement processes?

A Program- level PMIS includes more refined tools that capture some information as the work is being done. These are not essential to getting the job done, but knowing how the tools have been used can be helpful for making better decisions.

For example, a tool may capture input that the builder is taking too long to complete a task, which could be delaying the next stages of construction. The owner can use this information to find out why the builder is having challenges or come up with a plan to make it easier going forward.

The next post in this series discusses Business- level PMIS software.

The third level of the PPB framework is Business. This is where the PMIS system is integrated into other systems that the business is using for its core functions. In my experience, very few organizations are operating at the level where this is happening. However, with development being so critical and central to what a project owner or developer does, having some type of integration between the PMIS and the rest of the organization's business critical software can be a game changer when it comes to scaling the program.

Here are three ways a PMIS system can be integrated with other business software:

1. Enterprise Resource Planning (ERP) software

The term ERP refers to a suite of integrated applications that an organization can use to collect, store, manage and interpret data from many business activities. These activities include accounting, human resources, manufacturing, order processing, supply chain management, customer relationship management, etc. There is free and open source ERP software as well as proprietary ERP software which can costs hundreds of thousands of dollars. In the latter category, popular ERP software includes SAP Business Suite, Oracle E-Business Suite, Microsoft Dynamics.

2. Accounting software

While accounting software can be included within an ERP, some organizations have stand-alone accounting software which is not integrated with other business management software. This software typically provides the ability to record transactions, manage budgets, perform accounting tasks, perform payroll and customer relationship management, and prepare financial reporting. Popular accounting software includes QuickBooks, Sage, and Great Plains, but there are many applications including free options.

3. Computerized Maintenance Management System (CMMS)

A CMMS is a software package that is used for operating and maintaining assets. This software includes real-time information which is essential for ongoing asset management. Since it is essential for those operating or maintaining an asset to know how it was built, a smooth transfer of information from the PMIS to the CMMS can help minimize risks and lower costs.

A level 3 toolbox has tools that are capturing data while they're being used and actively sharing that data with the owner in real time. For example, in a Level 3 system, the owner knows how many nails have been used, what type of nails, where they've been used, by whom, and how many more might be required—and the owner can preemptively go ahead and place an order for more nails before the builder puts in a request for them, thereby reducing the time that would otherwise have been lost waiting for more supplies before the job could be continued.

Here are four questions to ask as you evaluate different Level 3 systems as well as your organization's readiness for this kind of system. The answers to these questions may dictate the kind of system your organization requires:

I. What type of business-critical software is your organization using? Does any of this software have existing integrations with any of the PMIS systems on the market? Is the software open API so that it could be integrated if so desired?

II. How much interface is there between different departments or divisions within the company and the development team? Is there already a working relationship between these groups? Any type of integration between the PMIS system and business software will require them to work closely together, possibly for an extended period of time.

III. How time sensitive are the payment terms for vendors? If the payment is due within a short time period, or if there are heavy penalties for being late or missing payments, an integration between the accounting software and PMIS system could pay for itself pretty quickly.

IV. Is the organization operating the projects after developing them? Even if it isn't, how valuable is the information gained during development for the party that will be operating and maintaining the asset?

Now that you have reviewed the different levels of PMIS software, the main question is:

Where is your organization today and where does it need to be in order to achieve its objectives?

It is much easier to go from Level 1 to Level 2 than it is to go from Level 1 to Level 3. However, if you are implementing a new system entirely, it may be appropriate to pick a Level 2 or Level 3 system based on the organization's internal capabilities, needs and aspirations.

In the next post in this series, we will share an action plan to identify and select the right PMIS software for your organization.

This is the final post in our five-part series on identifying and evaluating PMIS systems for your organization.

Now that you understand the type of PMIS system your organization needs, it is time to build an action plan to help you identify and select the right software for your organization.

Our recommendations for the evaluation of PMIS software are based on our experience identifying, assessing and recommending PMIS software for our clients. We find that the most valuable and important input in this process comes from the core users (sometimes called the power users or system administrators) who will be using the system daily.

A PMIS action plan should consist of six steps:

1. Software Identification
2. Desktop Analysis
3. Software Demos
4. Making the Decision
5. Internal Buy-In
6. Commercial Negotiations

Software Identification

In determining which PMIS software is a good fit for your organization, it is important to start with a set of all the potential software that could meet your needs. There are several websites that list different PMIS software systems and provide basic information about and comparisons of the software. Examples include Capterra.com, G2.com, and SoftwareAdvice.com.

Software comparison websites often rely on unverified third-party sources, so it's best to use these sites to develop an initial list of options and gather basic information before doing a deeper dive into each application.

Another good source of information is similar organizations in your industry. We recommend reaching out to someone in their project management team and asking them what PMIS they are using to manage their projects. Some organizations might be inclined not to share this information while others are fine with sharing the name of their PMIS and perhaps even providing some information regarding their experience using it.

The bulk of the information about each PMIS system will likely reside on the developer's website. You should be able to find information about features and specifications, screenshots, case studies, and more. Some developers provide extensive PDF documentation about the software as well as links to videos and webinars where you can see it in action and learn more.

Since the information is coming directly from the developer, it is best to take some things with a grain of salt. For example, you can discard any platitudes ("our software is the best at…") or marketing language about specific features ("really easy to integrate with…").

Desktop Analysis

The next step in the process is to develop an evaluation framework. This is a fancy word for a spreadsheet where you list all the desired features and functions of your PMIS. Each of the identified software applications from the previous step will then be scored against the criteria in the spreadsheet.

Here are some possible evaluation criteria; remember to weight these based on your priorities before scoring the software in each category. It is also possible to create criteria with "yes or no" responses as part of a fatal flaw exercise, such that any software that does not meet the desired response would be removed from any further consideration. For example it may be important to the organization that the PMIS have multi-factor authentication, and if the software does not provide this, it would not be included in the ongoing analysis.

Evaluation Criteria	Definition
Pricing	How easy is it to understand the pricing and how reasonable is the pricing structure?
Support	What is the resource level of support, training and implementation that the company provides?
Workflow & Integration	How well does the software integrate with the existing business software?
Project Management	Are the tools robust enough to handle all aspects of project management?
Program/Portfolio Management	Can the user assess multiple projects simultaneously and make better resource allocation decisions?
IT Security Protocols	Does the software utilize best in class IT security protocols?
Functionality & Form	Is it easy and intuitive to use?

Software Demos

The evaluation framework exercise should result in an overall ranking of the PMIS software. The next step will be to schedule demos with the top scoring PMIS applications. This may include any number of systems, depending on how close the scoring is (and assuming they pass any type of fatal flaw exercise).

Most software developers are pretty responsive when it comes to scheduling demos, although some do have to be prodded a few times. The nature and quality of the developer's response to the request for demo may be a factor in considering the software (since it portends future challenges with their customer service if they cannot handle a simple request for a demo).

Most sales representatives like to have a pre-demo call to gather information which can then be used to make the demo as tailored as possible. It is good practice to develop a list of questions about the software. For example, the developer's website may list a specific function for the software, but it does not appear on any other list or in screenshots. These questions can be sent to the sales representative in advance of the demo or they can be asked during the pre-demo call or demo session.

Another pre-demo suggestion is to develop a post-demo survey using an online survey tool (Google Formsis free to use with a Gmail account and Survey Monkeyis also very popular). The survey should include a range of questions that require both qualitative and quantitative responses. For example: "Would you feel comfortable using this PMIS to manage your projects? On a scale of 1 to 10, how well does this PMIS address our organization's construction management needs?"

The survey should be administered immediately following the demo, with as much follow up as needed to secure an acceptable response rate.

Most demos usually go between 1 to 2 hours. The bulk of the session will be the developer's team sharing the interface, capabilities, functions and other aspects of the software, but there should be at least 15 minutes for questions from the audience. On the purchaser's side, the core participants should include the core/power users, project team members, and any other staff in the organization who will likely be using the PMIS on a regular basis.

Making the Decision

Before making any decision, it is important to request cost information from the developer. This can include a general estimate of the cost based or a specific quote based on the number of users and/or annual construction volume (ACV). Most PMIS software developers are comfortable sharing a general estimate of the cost up front, with a more detailed and specific proposal later in the process. The general estimate should be good enough for comparison purposes.

With the information that you and your team have gathered from online research, publications, conversations, demos, and costs, it is time to make a decision. It's very possible that the decision will come down to two or three PMIS systems. You may find that some are stronger in one area but not as strong in others; or that everything seems good with a particular PMIS, except the cost. This is very common.

As discussed in our earlier articles: if you believe the PMIS can get your organization to where it needs to be, then it is not just about the PMIS but rather about doing everything you can to make the software work for your organization.

Generally speaking, it is not the PMIS that prevents an organization from meeting its objectives for successful project management.

Once the decision has been made, it's time to convince others in the organization that you've made the right decision…

Internal Buy-In

The larger the organization, the more layers of approval are typically required for any acquisition that will impact the operations of the company. Securing buy-in is not only about gaining the necessary approvals but also the goodwill from others in the organization who have some involvement in project management, and by association, the PMIS. This list may include accounting, purchasing, engineering, management, finance, operations, and so on.

Every organization will approach this process differently. Some organizations will invite all stakeholders to a meeting with representatives from the software company and consultants to discuss why this PMIS is being chosen, how it will be implemented, other information of interest, and to answer any questions. Others will provide information via the company intranet, messaging system or email. Many public sector organizations require all acquisitions above a certain dollar threshold to go through an RFP/RFQ process, even if the decision about which software to select has already been made.

While going through the proper channels and securing buy-in from all stakeholders may delay the implementation, it is key to the long-term success of the project management team, project management process, and PMIS.

Commercial Negotiations

Finally, you've gone through all the steps to evaluate, select, and secure internal approval for the PMIS. I'd love to tell you that the journey is nearly complete, but the real hard work is just beginning (implementation!). By doing your due diligence, finding the right PMIS for your organization, and getting alignment from the stakeholders, you have prepared yourself for the rest of the journey to go as smoothly as possible. But before you can embark on the journey, there's a final step: commercial negotiations.

Note: in this section, I will primarily use the term "price" to denote the cost (or licensing fee) of the software to the buyer, although these terms are used interchangeably in discussions between parties. I also like to point out that the PMIS should be seen as an investment (and a very good one if used properly).

There are three things to understand when it comes to negotiating the cost of your PMIS software:

1. The cost is negotiable, to a degree; the pricing model is not.
2. Licensing costs are based on annual construction volume (also called annual capital value or annual capital budget spend), number of users, or both.
3. You have the most leverage before executing an agreement.

Flexible Pricing

Software has a very low marginal cost. There is, of course, a high upfront cost to develop the software: thousands of hours of software developers' time; computers and networking equipment; websites and marketing materials; salaries and benefits for sales, marketing, administrative and management staff; offices and data centers; and so on. However, the cost of selling an additional license (to you) is very low; perhaps some time on the part of a salesperson and technical specialist, but not much more than that.

However, venture capitalists don't invest in software companies for altruistic reasons; they want a healthy return on their investment, and investors love the SaaS (software-as-a-service) model, in which customers pay a monthly or annual license fee for the software instead of purchasing it (although the latter is an option with some PMIS software). These recurring revenues allow investors to project revenues over a longer term, assuming some rate of growth in the customer base as well as annual increases in the license fees.

This all means that it is very difficult to ascertain the actual cost of the software, which also means there is a lot of flexibility in how it can be priced. The initial quote for the license fee is usually just a starting point for negotiations. How much the developer is willing to negotiate really depends on several factors, such as:

1. How strategic is the customer? Does it provide entry into a new geography, industry, sector or segment?
2. How promising are the future sales with the customer? Will they have a lot of construction volume or users in the future?
3. What incentives are available for the developer to make a deal within a certain time frame?

Construction Volume and Users

Most users of business software are familiar with software pricing models that revolve around the number of seats or users. Some PMIS systems also utilize this user-based pricing model, but many of them use Annual Construction Volume (ACV), also called Annual Capital or Construction Value (or a combination of both).

It is very important to pay attention to the definition of ACV as it may differ for each software provider. In monetary terms, there is a big difference between the total budget of all projects loaded into the software and the projected monetary spend on construction activity in a single year. The former can easily be a multiple of the organization's actual construction spend, especially for renewable energy projects which can spend extensive time in the pre-construction stages.

For most systems, as the basis value increases, the cost per $ million of construction activity decreases. The rate at which this happens depends on the system's pricing model. For some systems that target larger organizations, the pricing may not be advantageous for those doing less than $4 Million in ACV; for others, pricing may be favorably skewed towards those doing less than $2 Million in ACV.

Every PMIS system has its own variation on the basic pricing model. Since those pricing models as well as the terms and conditions can and do change frequently, it would not be worth sharing details on those here. Once an organization has reached this stage in the process, it should be familiar with the pricing models of all systems under consideration and be able to compare their merits accordingly.

Leverage

MBA graduates love using the word leverage, so it would be remiss of me not to use it here. In this context, it refers to the power that customers have in any negotiation that requires subsequent negotiations in the future.

Buyers of PMIS software have leverage before signing their first contract because the initial sale is the most important one to the seller; without it, future sales do not happen.

Thus, the PMIS developer is most willing to agree to concessions to close the sale.

Certainly, pricing will be the main focus for any concessions from the buyer's standpoint, but the three other key areas to consider for negotiations include:

• the definition of ACV (e.g. should it include soft costs or equipment purchases?),
• the number of user licenses (e.g. how many power users versus standard users are allowed), and
• various add-ons or options to be included (e.g. integrations with other applications).

Through clear, direct communication, an agreement can be secured in writing which then leads to a formal purchase order and/or an invoice.

Now the fun part really begins: implementing and using your new PMIS software. We will share insights and advice around that in future posts and videos.

The North American Power Grid is aging, physically and technologically, and could very well become the limiting factor in the clean energy transition. With increasing emergent power generation technologies at our fingertips, and significant shifts and increases in electricity demands at our doorstep, our current day model for power generation, transmission and distribution is increasingly being challenged.

As the need for grid reliability and adaptability progressively comes into focus, the current model looks increasingly outdated and the need for modernization has become urgently apparent. Although progress is being made, the challenges being faced remain largely unresolved.

This article marks the beginning of a three-part series that will provide an overview of the mounting challenges facing North America's electric grid infrastructure; the current and upcoming policy reforms aiming to address these challenges; ways in which electric service providers can prepare, plan, and advocate for the grid of the future.

Current State of The North American Electrical Power Grid

Up until the 21st century, the North American bulk power supply system (BPS), colloquially known as the "electric grid", has been operating almost solely on a centralized power supply model. In this model, large scale plants such as nuclear, coal, and natural gas serve as centralized electrical power sources transmitting electricity locally and over long distances, each serving a large customer base over a large geographical area. This model has been left in place, as over the past century, it has proven to be effective, affordable, and highly reliable.

Contemporarily, this centralized model is facing numerous challenges brough on by an aging infrastructure, and compounded by demands brought on by emergent generation technology interconnections as well as forecasted increases and shifts in consumer demands. This convergence of factors is already placing strain on a system that emerged early in the 20th century.

To meet the present challenges, along with those fast approaching from the horizon, will require a vast array of stakeholders, in tandem with governmental agencies, to re-think the current bulk power supply model and planning processes and will require a tremendous nation-wide modernization effort to realize.

The Changing Landscape of Our Electrical Power Needs

At the core of this dilemma is the need for a reliable and resilient supply of electricity, essential requirements that are being challenged by both foundational and emergent factors, such as:

• Aging infrastructure in need of significant upgrades and maintenance such as transmission lines, approximately 70 percent of which are over 25 years old and approaching the end of their typical 50 to 80-year lifespan.

• The steep rise in distributed energy generation resources (DERs) such as solar and wind, which produce power locally and on a smaller scale. The power they produce is often intermittent, and of differing qualities when compared to that of traditional large-scale power plants, which makes integrating these resources into the traditional grid model significantly complex. Additionally, these resources can be remote, requiring new transmission to be built in order to connect them to the grid.

• The shift in future energy demands triggered primarily by the widespread adoption of electric vehicles. Off-hour demand will increase concurrently with the number of personal electric vehicles which are typically charged during the evening and early morning hours. This shift in demand will have a range of effects, most notably a potentially significant decrease in transformer lifespans due to their inability to moderate their oil coolant temperatures, which is usually accomplished during off peak hours.
• Material shortages such as Grain-Oriented Electrical Steel used in the manufacture of electrical transmission and distribution equipment which is only produced at one location in the United States.

All in, it is estimated that 57% increase in transmission capacity will be needed by 2035, equating to 47,300 GW-miles of new transmission.

Progress in Addressing New Electric Power Needs

The majority of the planning and work remains, but progress has been made, and substantial goals have been established within the Department of Energy and FERC. Some of which include:

• Increasing reliability through enhancements such as new strategic interregional grid interconnections and localized power generation capacity.

• Developing cost-effective energy storage solutions to balance supply and demand, especially those to be used in conjunction with intermittent renewables.

• Increasing data transparency and establishing new grid management strategies to accommodate the rise of distributed energy resources and microgrids, as well as to provide overall increased efficiency and market competition.
• Enhancing supply chains and developing the skilled workforce needed to meet forecasted demands; preparing for the knowledge transfer that will be needed as a large portion of the experienced workforce approaches retirement.
• Continuing to advance, develop, and deploy smart grid technologies, including metering infrastructure and demand response programs that have been instrumental in making strides toward modernizing and increasing efficiency thus far.
• Increasing cybersecurity capabilities.
• Creating a set of industry standards to serve as a common language throughout the many siloed regions.

In order to effectively meet present and future challenges in modernizing the electric grid, all stakeholders in the industry must work in concert towards a single set of established goals.

Proposed and recently enacted federal policy has been passed to address long interconnection queues and improve the associated application processes. These will be followed by long-term planning efforts for the overall grid. With these processes in place, a modern electric grid will become more feasible.

In the next post in this series, we'll dive deeper into solving the interconnection crisis.

The Interconnection Problem in North America

Over the past two decades, the increasing number of non-traditional generation projects, mainly wind and solar, are pushing the limits of traditional grid planning. This large increase in non-traditional project requests has disrupted the interconnection planning process, not only causing a longer wait for interconnection approval, but exposing flaws and incompatibilities within the study and approval process.

The longer approval process for new power generation resources has the potential to stunt the transition to renewable energy as well as leading to resource adequacy problems "if new resource entry does not occur rapidly enough to match the pace of resource retirements" according to a July 28, 2023 concurrence writing by FERC Commissioner Clements.

Current State of Affairs

Currently, the review and approval of new generation projects and existing plant improvements is primarily accomplished through a serial study process. This process is tailored for large, centralized power generation projects which rely on interconnection customers to pay for network upgrades.

These practices were designed to process a low number of project requests at one time and to accommodate projects that would each service a relatively large geographic area or customer base.

Interconnection customer requests are mainly reviewed and approved through the well-established "Serial Study Process" which adopts an "invest and connect" approach. The exception to this is the Electric Reliability Council of Texas (ERCOT), which has implemented a novel and somewhat controversial "connect and manage" approach.

Within the "invest and connect" approach, there are two avenues for submitting interconnection requests.:

• Network Resource Interconnection Service (NRIS)
• Energy Resource Interconnection Service (ERIS)

These two processes are typically applied in Non-Energy-Only Markets, in which pricing and compensation structures go beyond just paying for the electricity consumed:

• NRIS requires proposed generators to serve as capacity resources that will contribute to resource adequacy requirements during severe grid conditions. In turn, generators are provided with capacity compensation and power dispatch priority. To achieve full deliverability, NRIS studies often identify the need for significant grid upgrades to relieve foreseeable constraints brought on by proposed projects, known as network upgrades. Instead of proactive transmission planning, the NRIS process has demonstrated a tendency to prioritize reliability, resulting in an overbuilt transmission system and inefficient allocation of resources. These excessive reliability requirements, coupled with stringent regulatory approval and compliance requirements, can lead to financially unviable projects and cause delays in the interconnection process.
• ERIS does not require full deliverability during severe grid conditions, and therefore is less likely to require network upgrades. Consequently, generators are ineligible for capacity compensation and may have their power dispatch curtailed before NRIS resources during emergency conditions. Although this introduces greater uncertainty for project revenues, these projects can avoid the excessive requirements and restrictive assumptions associated with NRIS.

The "connect and manage" approach, unique to ERCOT, emphasizes the efficient interconnect of new generation resources while continuing to actively manage the grid.

This approach aims to balance the integration of new resources with the reliability and stability of the electric grid, often sacrificing reliability for efficiency in quickly adding a broad range of generation resources.

There are two notable characteristics of this approach's economics. The first is the absence of capacity compensation which leads to decreased economic certainty. The other is the way electricity is priced, which is based on an open market in which generators are compensated for the electricity they produce and are able to sell into the market.

Perspectives on ERCOT's operational approach vary but there are some apparent tradeoffs. ERCOT's approach allows interconnection customers to more quickly connect to the grid. During 2021, ERCOT was able to interconnect five times more total capacity than PJM, adjusting for differences in peak load. While there are reduced upfront interconnection costs, rate payers are required to pay for network upgrades, which allow for a broader range of viable project types and sizes. Infrastructure investment is market-driven which promotes efficient allocation of resources, capacity, and investment.

The tradeoff for market-driven infrastructure investment is that grid bottlenecks are met with economic curtailment and congestion pricing which is reflected in the open market. Although this is helpful to identify the next round of network upgrades, the risk of curtailment leads to uncertainty in project economics. Furthermore, in eliminating project deliverability requirements, there is a trend toward resource inadequacy. This curtails ERCOT's ability to effectively manage grid congestion, inhibits delivery of the lowest cost power to load, and contributes to volatile customer rates.

Balancing Interconnection Processes and Grid Management

In summary, the surge in non-traditional energy projects has exposed shortcomings in traditional grid planning models, leading to prolonged approval processes. The prevalent "invest and connect" model which relies on NRIS and ERIS often results in overbuilt transmission systems and financially untenable projects. Conversely, ERCOT's "connect and manage" approach emphasizes rapid integration but can lead to economic uncertainties and inadequate resources. Striking a balance between efficient interconnection processes and prudent grid management is crucial to address current shortcomings and propel the energy transition toward reliability, economic viability, and environmental sustainability.

Our Electric Grid Needs a Major Upgrade: Here's How We're Doing It

Our electricity needs are changing rapidly, with more reliance on renewables and electric vehicles. But our power grid, the system that delivers electricity to our homes and businesses, isn't keeping up. This blog post picks up from the last one in the seriesand explains the challenges and ongoing efforts to upgrade our grid for a cleaner, more reliable future.

The Problem with the North American Power Grid

• We need  triple the amount of electricity  by mid-century. This surge is fueled by the electrification of vehicles, home heating, public transportation, and industry.
• Renewable energy sources  like wind and solar are growing, but they produce energy intermittently and are often far from where people live.
• Our grid is  fragmented and aging, making it harder to deliver power efficiently and reliably.

To accommodate the growth of both demand and supply, a major overhaul of our nation's transmission system is essential.

Infrastructure and Policy Hurdles in Grid Modernization

To meet the increasing demand and integrate renewable energy sources effectively, we must embark on a significant expansion of long-distance transmission lines and enhance the inter-regional connectivity of our power grid. This requires not only substantial investment but also a shift in planning and policy to prioritize long-term, nationwide interests over short-term, regional ones.

Current obstacles include limited transmission development in recent years, inadequate inter-regional links, and a planning framework that often prioritizes utility interests over those of consumers. Additionally, the process for approving and permitting new transmission projects is cumbersome and varies widely across states, hindering efficient development.

Proposed Solutions for Grid Modernization

• New Transmission Lines We need to build more power lines, especially long-distance ones, to connect renewable energy sources to population centers.

• Better Planning We need a coordinated national plan to guide these upgrades, considering long-term needs and public benefits.

• Standardized Benefits Currently, different regions use different methods to evaluate projects, making it harder to plan effectively.
• Fairer Cost Sharing Right now, utilities often prioritize their own interests over broader benefits when deciding which projects to build.
• Early State Involvement States need to be involved in planning early on to ensure projects meet their needs and policies.
• Increased Inter-regional Connections More connections between regions would improve reliability and allow for better use of renewable energy.

Efforts Underway for Grid Modernization

• Federal Legislation The Infrastructure Investment and Jobs Act allocates funds for grid upgrades and promotes clean energy.
• FERC Rule-making The Federal Energy Regulatory Commission is expected to issue new rules soon to improve transmission planning and cost allocation.
• The BIG WIRES Act The BIG WIRES Act, introduced in September 2023, aims to improve interregional connectivity, further supporting the grid's ability to meet future demands. More details on the act here.

A Call to Action for a Modern Grid

The transformation of America's electric grid is not just necessary; it's underway. With the right planning, policy reforms, and investment, we can build a grid that meets our future energy needs, supports the integration of renewable energy, and moves us closer to our decarbonization goals. The time for action is now, as we lay the groundwork for a more resilient, efficient, and sustainable electric power system.

I recently read the November/December 2025 issue of Constructor Magazine (published by Associated General Contractors). This issue is a valuable resource for anyone managing capital programs today, and not just because of the construction coverage.

Current Challenges in Capital Programs

Tariffs are disrupting procurement processes. Workforce shortages are delaying nearly half of all projects. Data center construction is accelerating at a pace that strains every trade in the country. Furthermore, contractors are formalizing processes they once handled informally, as the cost of errors has increased significantly.

For owners of capital programs, these challenges are not theoretical. They impact your schedule, capital budget, and board reporting. The real question is not whether risks exist; it is whether your program governance is structured to manage these risks before they escalate into problems.

The Numbers Are Clear

According to the AGC/NCCER Workforce Survey cited throughout the issue, 92 percent of construction firms are struggling to fill open positions. Forty-five percent report project delays tied to labor shortages. Additionally, 16 percent have experienced delays or cancellations due to tariff-driven cost increases.

When an EPC contractor cannot staff adequately, when transformer lead times extend beyond twelve months, and when steel and aluminum costs surge due to tariffs, the impact is immediate. The contractor's constraints become your constraints as the program owner.

Strong owner-side program management does not eliminate these risks, but it makes them visible early enough to take action.

What the Data Center Surge Means for Energy Infrastructure

One significant theme in the issue is the surge in data center construction. Major companies like Microsoft, Amazon, Meta, Alphabet, and OpenAI have committed extraordinary capital to this buildout. Permitting has been streamlined by executive order, and the demand for power is increasing faster than utilities planned for.

Data centers currently consume about 4.4 percent of U.S. electricity, a figure the Department of Energy projects will reach between 6.7 and 12 percent by 2028. Trimble's director of industry workflow summarized it well:

"I don't think the word 'surging' even begins to describe it. There are dozens and dozens of projects going on right now, and mega-data centers are on the rise."

-- Duane Gleason, Director of Industry Workflow, Trimble

For utilities and infrastructure owners, this demand translates into simultaneous capital programs: new transmission corridors, substation expansions, generation interconnections, and distribution reinforcements. These are not isolated projects; they are portfolios under schedule pressure. Most owner organizations were not designed to manage this level of concurrency with their existing tools and structures.

Contractors Are Tightening Their Controls. Are Owners?

One instructive part of the issue describes how leading general contractors are now conducting formal reviews of subcontractor financial health and workload capacity before making awards. Maria DiTommaso, Senior Risk and Contract Manager at Bond Brothers, explained their approach:

"We require subcontractors to submit a work-in-progress schedule so we can see what they're doing currently and what they have ahead. We want to ensure that if we award the business, we're not going to overload them."

-- Maria DiTommaso, Senior Risk and Contract Manager, Bond Brothers

Owners should reflect on how they evaluate contractor capacity across their portfolios.

In my experience working with utilities and cooperatives, vendor performance management at the owner level is often informal. Feedback is relationship-driven, and performance information is not systematically captured in the project management information system. Lessons learned do not reliably inform future procurement decisions.

This gap can be costly in a market like this one. When vendor risk is not quantified, early warning signals are missed. What could have been a simple schedule adjustment can quickly escalate into a default event.

The Governance Problem

Program management is the discipline of organizing projects to collectively advance an organization's strategy. It requires more than just tracking cost and schedule; it necessitates alignment across procurement, engineering, finance, operations, and risk management.

Without structured governance, risk management becomes reactive. Spreadsheets often sit outside the PMIS. Portfolio reviews occur quarterly, and escalations are informal. In a stable environment, this may be manageable. However, in a constrained labor market with tariff volatility and competition for materials from hyperscale construction programs, it is not.

The issue also references an estimate of nearly one trillion dollars in annual productivity loss across the construction industry. This figure reflects the cumulative cost of fragmented data, informal processes, and governance gaps. While some inefficiency originates from contractors, much of it stems from the owner side, where program structures are insufficient for the scale and complexity of current capital programs.

What THAMPICO Does

THAMPICO is a program and project management consultancy focused on energy infrastructure, utilities, and capital programs. We work on the owner side. Our role is to strengthen execution capacity so capital programs perform predictably under pressure. Our consultants have supported over one billion dollars in capital programs across utilities, cooperatives, and public agencies.

Our work typically includes four areas:

• PMO Design and Deployment: We clarify governance structures, escalation pathways, reporting standards, and portfolio visibility. We help organizations transform a PMO from a reporting function into an execution function.
• PMIS Implementation and Optimization: We centralize RFIs, submittals, cost data, change orders, vendor performance metrics, and risk registers into one operational system. Most organizations find that Procore, e-Builder, or Projectmates, when properly configured for their workflows, eliminate the data silos that hinder proactive governance.
• Risk Framework Development: We establish quantitative risk registers tied to schedule and financial exposure. This shifts the focus from static logs reviewed periodically to active risk management that supports board and regulatory reporting.
• Vendor Performance Integration: We embed measurable performance criteria directly into project workflows, ensuring that future procurement decisions are informed by actual data, not just institutional memory.

Strong Owner Governance Benefits Contractors Too

Strong owner-side governance is not adversarial to contractors; it enhances project efficiency for everyone involved. Clear scope definition reduces change order disputes. Timely decisions prevent schedule drift. Structured reporting improves transparency on both sides. When the owner can accurately read and respond to project data, operations run more smoothly.

We have also observed that owners with mature PMOs tend to be better clients for their contractors. Subcontractor default events, cost overruns, and disputed change orders are more common on programs where owner governance is weak. Better owner governance reduces these friction points for everyone.

If you are a contractor or construction manager who regularly collaborates with utility or infrastructure owners, and you are experiencing these challenges from the other side, we are eager to discuss that. We actively pursue referral relationships with contractors, insurers, and advisory firms that serve overlapping clients.

Three Forces Owners Cannot Afford to Ignore in 2026

Tariff volatility and supply chain fragility are not temporary issues. They are reshaping how procurement works for capital programs. Labor scarcity is persistent and will not resolve on a timeline that benefits current programs. Additionally, the competition for your contractors' attention from hyperscale data center programs is not going away.

Owners who invest in program governance infrastructure now will be better positioned to manage these conditions. Those who continue with informal structures will find that the margin for error has disappeared.

The construction industry will always carry risk. The differentiator is not who faces it; it is who builds the organizational capability to manage it consistently.

If you are leading a utility, cooperative, or public agency capital program and the conditions described in this article resonate with you, we welcome a conversation about your governance structure and options for strengthening it.

One of the more consistent problems I see in data center development is that critical project data lives in too many places at once. Schedule updates sit in one system, cost information lives in another, procurement status is tracked offline, and leadership is left trying to make decisions from reports that were already outdated when they were sent. That kind of fragmentation creates avoidable risk for developers, especially when capital is moving quickly and every delay carries a real financial consequence.

This is the reality of data center development today. The scale is massive and the timelines are aggressive. When programs move at this speed, the traditional ways of managing projects through disconnected emails and localized spreadsheets do not just cause delays. They erode the return on investment before the first server rack is even installed. I have watched this pattern repeat itself across complex capital programs. The gap between what is happening across project teams and the decisions being made by leadership is where the profit disappears.

Integrating a robust Project Management Information System like Procore into data center development is not about having a fancy piece of software. It is about creating a single, verifiable stream of data that connects project reporting, cost controls, procurement visibility, and executive oversight. In my experience, the programs that deliver the best ROI are the ones where the technology is treated as the foundation of execution, rather than an administrative afterthought.

The Scale of the Challenge

Data center construction is unlike almost any other type of infrastructure. It is a high speed collision of heavy civil engineering and extremely sensitive technology. You are dealing with massive power requirements that often require navigating the complex electric power grid landscapejust to get the site energized. You have long lead times for equipment like cooling units and backup generators that can span eighteen months or more.

When a developer is managing a portfolio of these projects, the complexity multiplies. If you do not have a centralized platform, you are essentially flying blind. I have seen organizations try to scale by simply hiring more people to manage the same broken processes. That approach only leads to more meetings and more conflicting spreadsheets. The real shift happens when you move from a project level view to a business level view. You need a system that allows leadership and program teams to see the status of every transformer and every permit across the portfolio in real time.

Field Data as a Financial Asset

Most people view daily logs and field reports as a compliance requirement. I view them as a financial asset. In data center development, project data is one of the earliest indicators of whether ROI is holding or starting to slip. If installation progress is trailing plan by two percent every week, that is a signal that your commissioning date is at risk. If you are using Procore correctly, that information is captured and surfaced quickly enough for program teams and leadership to act on it.

I often tell clients that the quality of your ROI is directly proportional to the speed at which information travels from project teams into the systems used for management and oversight. When a coordination issue is identified, that information needs to move immediately into a structured workflow. If an RFI sits in an inbox for three days, the schedule is already starting to move in the wrong direction. By integrating Procore, you eliminate much of the friction in that process. The RFI is linked to the drawings, the cost impact is tracked, and the schedule implications are easier to see. This level of transparency is how you stay ahead of the risks that are rife in the construction industry.

Managing the Supply Chain Nightmare

One of the biggest threats to data center ROI right now is the supply chain. I have sat in program reviews where the entire project was held hostage by a single missing specialized chip in a piece of switchgear. Procore allows you to manage these long lead items with a level of detail that a spreadsheet cannot match. You can track the submittal process, the fabrication status, and the shipping logistics all in one place.

More importantly, you can link these items to your budget and your schedule. If a delivery date slips, you immediately see the impact on your cash flow and your projected go-live date. This allows you to make proactive decisions. Maybe you can re-sequence the work to keep other trades moving, or maybe you need to look for an alternative supplier. You cannot make those choices if you are finding out about the delay three weeks after it happened. A well-implemented PMIS moves an organization from being reactive to being proactive. This is a core part of moving toward higher PMO maturity for energy and infrastructure developers.

Bridging the Gap to Business Decisions

The true power of integrating Procore into data center development is seen at the program level. Most developers are not just building one facility. They are building a global network. When every project is using the same platform, you can begin to see patterns. You might notice that certain contractors are consistently more efficient or that specific design choices lead to fewer change orders.

This data is invaluable for future planning. It allows you to refine your cost estimates and your schedules based on actual performance rather than theoretical projections. I have helped organizations implement a PMIS evaluation framework at the program levelto ensure they are capturing this high level data. When your technology stack is aligned with your business goals, the ROI becomes a measurable reality rather than a hopeful estimate.

The Cost of the Status Quo

It is easy to look at the cost of a Procore license and the effort required for implementation and decide to stick with the old way of doing things. But the status quo has a hidden cost that is far higher. I have seen multi-million dollar claims that could have been avoided if the project documentation had been centralized and searchable. I have seen projects miss their market window because of avoidable coordination errors.

In the world of data center development, time is quite literally money. Every day that a facility is not operational is a day of lost revenue. If a PMIS like Procore can save you even a week on a two year build, it has likely paid for itself several times over. The ROI is not just found in the software itself, but in the discipline and clarity it brings to the entire organization. It forces a standardization of process that is essential for scaling.

Implementation is Not Optional

Setting up a Project Management Office and implementing a PMIS is a significant undertaking. It requires a commitment to changing how people work and how data is valued. I have learned that you cannot simply buy the software and expect it to work miracles. You have to build the processes and train the people to use it as their primary tool.

When I work with developers and see project teams using Procore consistently to update logs, manage documentation, and maintain current project records, I know that program has a much higher chance of success. They are not waiting until the end of the day to reconstruct what happened. They are creating a live operating record that leadership can actually use. That real time connection is one of the few reliable ways to manage the speed and complexity of data center development.

The industry is moving toward a future where data is the primary driver of construction efficiency. Those who continue to rely on fragmented systems will find themselves unable to compete on cost or schedule. The integration of Procore is a foundational step in ensuring that your capital program is built on a basis of truth and transparency. This is how infrastructure is delivered in the modern era. The result is a more resilient project, a more informed leadership team, and a significantly better return on investment.

This blog post summarizes key takeaways from a recent webinar on "Monetizing Tail Gas CO2 from Digester Biogas RNG Projects," hosted by Paul Greene of GreeneTec. The webinar featured presentations from industry experts Todd Taylor (Avisen), Sam Rushing (Advanced Cryogenics), and Jafeth Bulsink (Bright Renewables).

The Inflation Reduction Act (IRA) has brought about significant changes in the rules governing renewable natural gas (RNG) facilities and the associated carbon capture and sequestration (CCS) tax credits. One of the key provisions is that industrial facilities, which include RNG facilities, must capture at least 12,500 metric tons of CO2 in a taxable year to qualify for the Section 45Q tax credits. For those eligible RNG facilities, the IRA offers a lucrative incentive of $85 per ton of CO2 captured and sequestered or utilized.

The IRA introduces the concept of Direct Pay, which allows eligible entities to receive direct payments from the federal government for the first five years of the credit period. This feature has garnered significant interest from banks and financial institutions, as it enhances the creditworthiness of RNG projects. After the initial five-year period, the credit is paid out over the remaining seven years of the 12-year credit period. It's worth noting that if an entity opts for Direct Pay, it cannot transfer the credits.

A common financial arrangement in the RNG industry is the partnership flip structure, which allows tax equity investors to participate in the project's tax benefits while the developer retains operational control.

While the IRA presents exciting opportunities, there are complexities to navigate. For instance, tax-exempt bond financing for RNG projects can result in a 15% reduction in the Section 45Q credits. Additionally, it's crucial to understand the interplay between different credits. An entity cannot claim both the Section 45Q (for CO2 capture and sequestration) and the Section 45V (for clean hydrogen production) credits simultaneously. The general principle is that the credit should be treated as if it is attached to the specific molecule being produced.

Currently, there are approximately 111 CO2 suppliers in the United States, nearly all producing beverage-grade quality CO2 that meets the International Society of Beverage Technologists (ISBT) standards. However, beverage producers are hesitant to accept CO2 from biogas producers due to concerns over potential contaminants, despite the CO2 meeting chemical constituent standards. The beverage industry constitutes around 20% of the CO2 market.

According to economic analyses, the cost of producing and transporting CO2 ranges from $65 to $85 per ton while selling prices can vary significantly, from $70-$100 per ton for large food processors to several hundred dollars for smaller processors. The merchant sector is currently paying $10-$20 per ton for CO2 from ethanol producers, while the Section 45Q tax credit offers $85 per ton, making CO2 sequestration a more attractive proposition.

Looking ahead, the utilization of CO2 extends beyond existing markets like beverages, food, and industrial applications. Emerging markets include sustainable aviation fuel (SAF), e-methanol, e-methane, and concrete manufacturing. Navigating the complexities of tax credits, financial structures, and emerging markets will be crucial for success in this rapidly changing landscape.

Fossil fuel natural gas is under attack.

Over 100 jurisdictions in the United States already have legislation that bans natural gas hookups in new homes. New pipelines are becoming more and more difficult to build, primarily due to environmental and community opposition.

Despite these difficult challenges, the natural gas sector is still well positioned to bridge reliability and affordability challenges faced by our current energy transition to electrify everything.

In the near term, the electric grid lacks sufficient capacity to meet future energy demand forecasts. While the world races to expand and upgrade the electric infrastructure, natural gas as an energy source can better decarbonize certain sectors, such as long-haul transportation and heavy industry. Furthermore, we already have a reliable and extensive network of gas pipelines across and within the country. Gas utilities can leverage both their existing infrastructure as well as recently earmarked government incentives to produce renewable natural gas (RNG). RNG projects have an opportunity to optimize ROI while developing a robust decarbonization strategy to serve as a bridge to a sustainable future.

What is RNG (Renewable Natural Gas)?

According to the EPA(Environmental Protection Agency), RNG is a term used to describe biogas that has been upgraded for use in place of fossil natural gas.

What is unique about RNG compared to other forms of clean energy is that RNG takes a product that is negatively impacting the environment, waste, and turns it into a clean and reliable source of energy.

The biogas used to produce RNG can come from many sources, such as solid waste landfills, wastewater treatment plants, livestock farms, and food waste.

In this week's blog, I will dive deeper into landfill waste-to-RNG project financials and some key considerations when evaluating the economics of a project's business case. Here are the major components of any RNG project:

• Feedstock agreements (gas rights)
• Offtake agreements
• Permits (local and environmental)
• Technology selection
• EPC contractor
• Operations and maintenance (O&M) plan
• Pipeline interconnection

Assuming a plan is already in place to address the components above, let's take a closer look at the elements that drive the financials of a landfill RNG project, broken down into five categories:

Capital Investment

CAPEX elements encompass a range of key components, including Engineering, Procurement, and Construction (EPC), which covers the cost of designing, procuring equipment, and constructing the RNG facility.

Gas and electric interconnection expenses involve connecting the RNG plant to the gas pipeline and electric grids.

Development costs include permitting, land acquisition, and feasibility studies necessary to start the project.

Commissioning and startup expenses are essential for the final phase, ensuring the plant operates effectively and efficiently before the official handover to operations.

Lastly, the contingency bucket is reserved for unforeseen challenges and cost overruns, serving as a safety net for the project's financial viability. These CAPEX elements collectively shape the financial foundation of an RNG project, ensuring its ability to generate sustainable and clean energy from waste sources.

Revenue

The years of operations play a significant role as they determine the project's long-term revenue potential. A longer operational lifespan ensures sustained income from RNG production, provided the landfill's gas output isn't at the end of its lifecycle.

The gas curve and efficiency factor into the revenue equation by influencing the amount of RNG produced and its overall market value. Higher efficiency and a favorable gas curve can increase revenue by maximizing gas yields. Furthermore, environmental attributes, such as carbon credits and renewable energy certificates, also known as RINs, contribute to the primary income stream of RNG projects, reflecting the environmental benefits of producing clean energy and reducing greenhouse gas emissions. These revenue elements, when well-managed, can make RNG projects economically rewarding while also benefiting the environment.

Cost of Goods

The cost of goods sold comprises several key elements.

First, the landfill authority revenue share represents a significant expense, as it involves sharing a portion of the RNG project's revenue with the landfill where organic waste is sourced. This revenue-sharing arrangement compensates the landfill for providing the feedstock and land necessary for RNG production.

Secondly, broker fees add to the overall cost of goods sold, as they cover the expenses associated with intermediaries or brokers who facilitate the sale and distribution of RNG to end-users. Effective management of these cost elements is essential in controlling the overall operational expenses and ensuring the financial viability of the RNG project. More importantly, offering the optimal share of these project revenues will likely determine whether you win or lose the opportunity to develop the RNG project.

Operating Expenses

Operating expenses in an RNG project encompass a couple of essential elements.

First, Operations and Maintenance (O&M) costs are a significant component, covering expenses related to the day-to-day management, upkeep, and monitoring of the RNG facility. A proper O&M plan ensures the efficient and reliable operation of the plant.

Another critical element is the electricity requirements, which are necessary for running equipment, compressors, and other energy-intensive processes within the RNG facility. Minimizing electricity costs through optimizing energy-efficient technologies can be pivotal in controlling overall operating expenses and enhancing the project's financial sustainability. Efficient management of both O&M and electricity expenses is vital for the long-term success of an RNG project.

Other Considerations

Several other elements can significantly impact the business case for an RNG project.

Debt financing is a critical factor, as it affects the project's capital structure and financial risk. Prudent management of debt can enhance the project's profitability.

Investment tax credits can provide substantial financial incentives for RNG projects by reducing tax liabilities, making them more attractive to investors. Recently passed legislation, such as the Infrastructure Investment and Jobs Act in 2021 and the Inflation Reduction Act of 2022 include incentives of up to 30%-40%+ for RNG projects that start construction before 2025.

Additionally, terminal value, which represents the projected value of the project at the end of its lifespan , through the sale of a project's operations, equipment, or both, is a vital consideration. A terminal value can increase the overall attractiveness of the project by accounting for potential future revenues and asset values. These elements collectively shape the financial landscape of an RNG project, influencing its feasibility and success in the renewable energy market.

In conclusion, the success of an RNG project is influenced by a complex interplay of factors spanning both costs and revenues. CAPEX is pivotal for the project's initiation and includes elements like EPC, interconnection, and contingency, which must be managed effectively. Revenue elements, including the project's operational lifespan, gas curve, and environmental attributes, are essential in determining its long-term financial viability. Additionally, operating expenses, such as O&M and electricity requirements, directly impact the ongoing costs of the project. Beyond these, other factors like debt financing, investment tax credits, and terminal values can have a significant influence on the project's business case, affecting its attractiveness to investors and overall financial sustainability. Careful management of these elements is crucial for ensuring the successful development and operation of an RNG project.

Renewable energy is the clear way forward, and the incentives available in this sector are a powerful catalyst for a sustainable and lucrative future. However, navigating the complex landscape of incentives, compliance, and project management can be a daunting task.

Earlier this year, Sirous Thampi, Founding Partner of THAMPICO was invited by Procorefor a webinar.Snowflake Rosen, VP of Sales for Owners at Procore, and Sirous discussed renewable energy incentives and the role of Procore in optimizing your renewable energy projects for maximum returns. Here are the main takeaways from the webinar.

Understanding the Landscape of Renewable Energy Incentives

To navigate the complex world of renewable energy incentives, it's crucial to first gain a comprehensive understanding of the incentives currently in place. At the heart of these incentives are federal, state, and local offerings, including tax credits, exemptions, rebates, grants, and low-interest loans. The intricacy of these incentives is contingent upon factors such as the specific sector and the scale of the renewable energy project. For those seeking a tailored list of available incentives, valuable resources like dsireusa.orgcan be a guiding light.

Most renewable energy owners and developers are aware of the incentives available to them, particularly those coming out of recent federal legislation such as the IIJA and IRA which has resulted in a lot of interest from the financial community as well.

Yet, it's important to recognize that incentives aren't limited to the public sector.

There is also the growing demand for renewable energy in the private sector or the voluntary markets. An example includes clean power purchasing programs from large energy consumers like technology companies and manufacturers. We are still in the early stages as far as the voluntary market but we will see a lot more in the coming years, and these opportunities may provide a more sustainable revenue basis for renewable energy developers in the long term. These initiatives represent a promising avenue that could provide long-term sustainability for developers in the renewable energy sector.

Achieving Alignment to Make the Most of Tax Incentives

As a starting point, companies must be prepared to deliver their projects in the most efficient manner possible, which requires the alignment of people, process, and technology. That's an ongoing effort for most companies, regardless of sector, size or type of projects. But it's an internal exercise.

The organizations that have their act together internally, so to speak, will be best prepared to respond to external challenges and opportunities.

Incentives are, by their nature, an external opportunity, as are interest rates, the labor supply, supply chain issues, carbon credit markets, etc. But there are challenges associated with incentives as well.

The recent federal legislation has provided a number of incentives for renewable energy. However, the government hasn't provided a lot of guidance on these programs. We still need more information from the IRS and Treasury Department to better understand the practical implications.

For example, we understand that for some renewable energy projects there's a 30% Investment Tax Credit if you go start construction by the end of 2024.

• But does that 30% apply to 100% of your capital investment?
• What does "start construction" mean exactly?
• And when can you claim the tax credit?

That's just scratching the surface in terms of the questions surrounding the ITC. Now extend that logic to all of the other incentives that have been announced.

The huge number of unknowns makes it very difficult to build the financial justification for projects that have a 20- or 30-year life. Especially if the incentives might change every time a new party takes control of Congress or the White House.

The best thing we can do is make sure our people, process and technology are aligned so that we can easily, quickly and efficiently respond to any external opportunity or challenge.

Differing Needs within Renewable Energy Companies

The renewable energy sector features distinct segments, with the electric and gas sectors standing out. But there are also some commonalities between these two sectors. For both sectors, there is generation, transmission (or distribution ), and storage. For the most part, these processes are based on technology that is decades, if not centuries old already; and in the U.S., our infrastructure often reflects this.

We've known how to create, move, and use energy for a long time. But we are getting better at doing so in a way that minimizes emissions.

The average person sees the pace of innovation in information technology and would like to see that happen in the energy industry.

But the energy industry doesn't move that quickly, and if it did, it would mean sacrificing things that are very important to people, primarily reliability and cost. We all want green energy, but are we willing to put up rolling brownouts or much higher utility bills to pay for it?

Renewable energy project owners and developers have the same basic needs as far as a project and construction management platform. But they do require some flexibility in terms of how the tools can be used. That's where Procore really shines. Procore's modules can be adapted for any type of project development use case. At THAMPICO, we have used Procore to scale a dairy biogas development business to over a billion dollars in construction volume, and Procore is the most popular software for solar and wind developers in the market today.

Overcoming Unknowns to Redeem Incentives

It's usually third-party application groups applying for incentives, and they need to know what information is needed for these applications so you can maximize your chances of getting the incentive money. The information they typically request ranges from engineering plans, process drawings, equipment lists, financial plans, and more.

For example, in California, there are LCFS credits (low carbon fuel standard) for renewable fuel suppliers. In order to qualify for those, you need to retain 10 years' worth of operational data. And that data is measured at every point of your project. You need to keep and retain this for 10 years for audience and compliance purposes so you can get those credits. That's a process challenge.

So, it's important to answer a few key questions:

• Do you have all of the specific information you need for your relevant programs readily available?
• Do you know how you're going to interface with the application party and hand over the information they need for your applications?
• Will the process enable you to improve your chances of succeeding in your applications?

Optimizing the Tax Incentive Application Process for Success

The alignment of people, process, and technology is key. Without one, you're not likely to get the most out of the others.

There are broadly three levels at which organizations may be able to use a system like Procore: Project, Portfolio, Business.

At the Project level, organizations need a way to obtain, maintain, and exchange project information.

It's all about ensuring all of your comprehensive project information and documentation is readily available in a single, fully connected system.

You don't have the time to send multiple requests via email to different parties. Many organizations use some variation of cloud storage to do this, but even then, they aren't really sharing information or collaborating with vendors.

At the Portfolio level, organizations make use of the project info to make better resource allocation decisions for a group of projects (program or portfolio). This is where you get into creating custom reports and using data analytics. You can tie in your software to other internal processes such as risk management, financial management, etc.

Some organizations have an individual who is tasked with doing this, but they're often too busy with just keeping projects afloat that they can't look for opportunities to gain efficiencies, reduce costs or mitigate risks at the program level.

At the Business level, organizations start to align their business process with the project and construction management platform. Procore can integrate with accounting software like QuickBooks, Sage, etc. as well as ERP software, CRM software, and other enterprise or business software.

This is where organizations get the most value out of Procore, because everyone is living in the system and it is tied to all of the key functions.

This will start to have benefits all the way down to the project level.

Procore's Role in Streamlining Renewable Energy Projects

Procore plays a pivotal role in the renewable energy sector. Since renewable projects often spend more time in pre-construction than in actual construction, using Procore early in projects and throughout their lifecycles is a strategic move. This approach ensures that comprehensive project information and data are readily available, ultimately optimizing project delivery and the successful attainment of incentives.

To delve deeper into the specific ways in which Procore sets renewable businesses up for success, consider the following:

Collaboration

Centralizing project information within Procore simplifies the process of gathering accurate project data for both internal and external application providers.

Flexibility

Renewable projects typically spend more time in pre-construction than in actual construction. Procore's flexibility allows it to adapt to different stages of project development.

Efficiency

Procore's app marketplace enables critical business processes to integrate seamlessly with project development processes. For instance, accounting integration minimizes the potential for financial transaction errors that could impact applications or audits.

Differentiation

In a competitive environment, Procore helps renewable energy owners build credibility and instill confidence in investors. This is especially critical when claiming tax credits, carbon credits, or tax incentives. It also helps be prepared in the event that you are audited by a government agency. There is a high likelihood that this would happen for a renewable energy owner that is claiming tax credits, carbon credits, and/or tax incentives.

Multiple Wins from Using the Right Project Management Software

Let's get down to the most critical question here:

If everyone is working in one system with all critical information in one place, what is the ultimate outcome?

There are multiple outcomes.

• It means businesses can deliver projects successfully,
• use their resources more efficiently,
• can take advantage of all the incentives out there,
• and minimize risk of error in projects and applications for these applications for credits.

For any developer, having the right project management software is important. But for renewable energy developers, it is even more critical. That is because the world of renewable energy is constantly in flux.