Académique Documents
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IntergratedBiorefineryLessonsLearnedInformation Filters
Entry SuggestedMitigation Internal/ Project
CID Recipient Description Impact Tag#1 Tag#2 Tag#3
ID Strategy External Phase
16 *N/A* NotProject UsinganEngineering,Procurement, Completeoutsourcingofmanagement Ownersneedtoclearlyunderstandand
Specific Construction,Management(EPCM)type ofaprojectcanresultintheOwner selectappropriatecontractingmechanisms
contractmaybeaninappropriatecontract losingcontrolofthecost,scheduleand tobalancetherisks/rewardsofoutsourcing
mechanismtoscaleupnewtechnologies. qualityoftheworkperformed. withtheneedtomaintainqualityand
controloftheprojectbaseline.Higherrisk
scaleupsofnewtechnologiesrequire
differentbalancingofrisktransferthan
standardengineering/construction
projects.
Award Project Project
External Negotiation Management ProjectTeam Execution
30 *N/A* NotProject Projectscheduleshavebeengreatlyimpacted Underestimatingtimerequirementsto IncorporatingNEPAexpertiseduringthe
Specific bybothBETOandtheawardRecipient completeaNEPAanalysislengthens FOAapplicationmeritreviewtoevaluate
underestimatingthelevelofNEPAanalysis projectschedulesandcansubstantially thelevelofNEPAreviewneededforeach
neededtogetadeterminationandmove increasecosts.Oneprojectrequired meritoriousproject(e.g.,ifan
forwardwiththeproject. anEnvironmentalImpactStatement EnvironmentalAssessmentor
(EIS),whichaddednearly2yearsto EnvironmentalImpactStatementare
thescheduleandaddedunplanned required)wouldprovideforearly
coststheproject. awarenesstobothDOEandtheselecteeof
thepotentialimpactstotheproject
baselinecostandschedule.
MeritReview
Internal Committee NEPA Schedule Cost
Entry SuggestedMitigation Internal/ Project
CID Recipient Description Impact Tag#1 Tag#2 Tag#3
ID Strategy External Phase
33 *N/A* NotProject Projectsrequestcontingencyreduction Initialcontingencyreductionproposals BETOhasdevelopedamethodologyfor
Specific immediatelyfollowingcompletionof aretypicallytooaggressivewith analyzingrequestsforcontingency
construction/commissioning,whichcanresult limitedjustificationduetocashflow reductionsfromintegratedbiorefinery
inunderestimatingthetimeandcostneeded concerns.ManyRecipientsbelieved projects.Themethodologyinvolves
toaddressoperational/shakedownrisks. thatoncemechanicalcompletionwas reviewingtheRecipient'smostrecentrisk
Recipientstypicallyhavecashflowissues achieved,risksweresubstantially register,havingBETOanditsindependent
duringthistime. mitigatedandtheneedforoperational engineeranalyzeeachrisktoassessthe
contingencywasminimal.Experience, effectivenessofthemitigationsemployed
todate,showsthistobeamisleading andtheclaimedresult(e.g.,riskcompletely
assumption.Commissioning,startup, mitigated,risknotmitigated,riskpartially
shakedownandoperationalriskshave mitigated),comparingtheamountofrisk
proventobeconsiderablyhigherthan reductionachievedtoindustry
estimated,resultingintheneedto benchmarks,andbalancingtheassessed
accesssignificantcontingencyfundsto riskagainstindustrybenchmarksto
addresscorrectiveactions,design determineDOE'sindependentestimatefor
changesandoperationsissues. contingency.Thismethodologyis
consideredabestpracticebyBETOand
GoldenServiceCenterProcurement
officials.
ActiveProject Project
Both Management Technical Regulatory Execution
41 *N/A* NotProject Applicantswereillpreparedfortheamount Resultedindelayedschedulesand UsetheNoticeofIntentprocesstoinform
Specific ofdocumentationrequiredtoreceivean improperlyutilizedresources. applicantsaboutwhatdocumentswillbe
award. expectedandBETO'sduediligenceprocess.
IncludingBETO'sdataminingsheet
templateasarequirementintheFOAis
recommended.
FOA
Internal Development Planning
43 *N/A* NotProject AnalysisofBudgetPeriod(BP)1costsshows ImpactsofunderestimatingBP1costs ValidatingtheTechnologyReadinessLevel
Specific that10%20%oftotalprojectcostisneeded include:scheduledelays;cost (TRL)andprojectmaturity(scaleup,
forsettingtheperformancebaseline, overruns;shiftingfundsfromlater continuoushoursoftestings,levelof
achievinganFEL3leveldesign(costestimate phasesoftheproject(e.g.,BP2)to integrationetc.)earlyinBETO'sselection
within5%/+15%)thatcanbeusedbyEPC coverBP1overruns;underestimating andnegotiationprocesswillbetterprepare
contractorforbiddingpurposes,permitting, BP2cost,scheduleandneedfor bothpartiestounderstandtherisksto
achievingfinancialclose,obtainingaNEPA contingency. projectexecutionbeforeinvesting
determination,andotheractivitiesthat significantfunds.
enablereadinesstoconstructthefacility.
Historically,BP1costsandscheduleshave
beenunderestimated.
ActiveProject Project
Both Management ProjectExecution Financial Management
Entry SuggestedMitigation Internal/ Project
CID Recipient Description Impact Tag#1 Tag#2 Tag#3
ID Strategy External Phase
85 *N/A* NotProject IBRprojectschedulesaretypicallytoo Overlyaggressiveschedulestypically BETOhasconsistentlyrequiredcertainDOE
Specific aggressiveandunderstatethecostsandrisks reflectpoorprojectbaselineplanning, criticaldecisionpoints(Go/Nogodecision
ofscalingupfirstofakindtechnologies.The apoorunderstandingoftheriskstobe points)beincludedintheapproved
driverappearstobetheneedtobe"firstto mitigatedandinadequateresource performancebaseline,alongwithvaluable
market,"butthetrendistooverlookthe loading,resultinginscheduledelays, projectmanagementindustrybest
challengesinherentinbringingtoscalenew additionalcosts,andcorrectiveactions practices,suchasRiskMitigationPlans,
technologies. toaddressunmitigatedrisks.Several RiskRegisters,andcontingencyneededto
IBRprojectsexperiencedadditional mitigaterisks.However,theeffectiveness
delaysandhighercostsdueto ofthesetoolshasbeenhighlyvariableand
overaggressiveschedules,improper frequentlynotvaluedbyIBRRecipientsas
riskidentificationandmanagement, muchasbyBETO.BETOcontinuesto
andinsufficientresourceloading. emphasizethevalueofthesetoolsinits
FOAsandinitsawardkickoffmeetings.
OneareawhereBETOisstrengthening
earlyimplementationofriskbased
assessmentsisbyrequiringanindependent
validationoftheapplication.Inthisway,
BETOisutilizingtheIndependentEngineer
toprovideitsprofessionaljudgmentonthe
effectivenessofproposedriskmitigation
plansandriskregistersbyIBRRecipients
beforetheprojectexpendssubstantial
funds. ActiveProject Project
Both Management Planning Management ProjectExecution
Entry SuggestedMitigation Internal/ Project
CID Recipient Description Impact Tag#1 Tag#2 Tag#3
ID Strategy External Phase
87 *N/A* NotProject Commissioning,startupandshakedown Theimpactsofunderestimatingthe Basedonthisexperience,aswellas
Specific seemstotakemuchlonger(atleasttwiceas amountoftimeandmoneyneededfor learningsfromtheIE'sexperienceandIPA
longasplanned)andismuchmorecostly thecommissioning,startupand benchmarks,BETOneedstomoreclosely
thanexpected.Forexample,manypilotscale shakedownoffirstofakindIBR scrutinizethecommissioning,startupand
projectsrequiredatleast2xtheplannedtime technologiesrangesfrom24timesas shakedowncostsandschedulewhen
tocompleteshakedown.Manyofthe longandupwardsof$10Min conductingtheCD2(Approve
projectsstruggledtocompletetheIE additionalcosts. performancebaseline)review.Also,risk
performancetestbecauseresourceswere mitigationduringtheconstructionphase
expendedduringthe needstobemonitoredmorecloselytosee
commissioning/startup/shakedownphase iflingeringproblemswillcarryovertothe
addressingunmitigatedrisksthrough commissioning/startup/shakedownphase.
correctiveactionsanddesignchanges.Many Simplyachievingmechanicalcompletion
IEperformancetestshavenotachieved doesnotnecessarilymeanariskisfully
continuous,steadystateconditionsforany mitigated.CD4shouldhaveappropriate
sustainedperiodoftimebeforeanissue commissioning,startupandshakedown
emergedtocausedisruptiontothetest. milestones/metricstoshowaplant
Again,projectsappeartobeoverlyoptimistic achievessteadystateoperations.Tying
thatoncemechanicalcompletionisachieved, DOEreimbursementstoachievementof
thatscalingupfirstofakindtechnologyis thesemilestoneswouldbealogical
notmuchriskierthancommissioning/startup incentivetodriveeffective
ofcommercialtechnology. commissioning/startup/shakedownusinga
realisticscheduleandbudget.
FOA Project
Internal Development Programmatic Management
99 *N/A* NotProject ThevalueoftheIndependentEngineer(IE) TheimpactofengaginganIEto BETOhaslearnedthehighvaluethat
Specific hasbeendemonstratedbothtoBETOandto supportBETO'sIBRprojectdue comeswithhavinganIEaspartofitsdue
manyoftheIBRRecipients.Theinteractions diligencehasmanifesteditselfin diligenceteamandintendstohaveanIE
havebeenprofessionalandprovidedmany smarter,betterdocumenteddecisions contractoronboardforallfutureIBRFOAs.
valuableinsights.TheIE'sexpertise,coupled byBETO;whetherthosebeatthe
withDOE'sinterestinbalancingprojectrisks CriticalDecisionGo/Nogopoint,orat
whilesimultaneouslyassistingtheIBR otherpointsofasignificantnature.
projectstobesuccessfulhasdevelopedintoa BETO'scredibilitywiththeindustryhas
strongcollaboration. alsobeenimprovedandenhanceddue
toitsuseoftheIE.Notsurprisingly,
banksunderwritingIBRprojectloans
subjecttoloanguaranteeshaverelied
onBETO'sreimbursementschedules
(preparedwiththeIE'sassistance)asa
basisfordevelopingtheirownloan
disbursementschedules.
ActiveProject Project
Internal Management Review Execution
Entry SuggestedMitigation Internal/ Project
CID Recipient Description Impact Tag#1 Tag#2 Tag#3
ID Strategy External Phase
104 *N/A* NotProject Differentapproacheshavebeenusedfor Whilenosinglereimbursement BestPracticesRequiringthattheIBR
Specific establishingandnegotiatingreimbursement schedulemodelhasbeenadopted, projectssubmitallproposedinvoicesto
schedules.BETOhastriedtobeflexibleto controloffederalfundshasbeen BETOindraftbeforeuploadingtothe
meeteachIBRRecipient'suniquecashflow effective. invoicesystem,VIPERS,hasallowedBETO
needs,whilemaintainingconsistentand andtheIEtocontinuouslyimprovethe
effectivecontrolonfundsreimbursement qualityandeffectivenessoffederalfunds
throughcontractualbudgetperiodsand control,especiallywithcomplexinvoices.
detailedreviewsofbackupdocumentation
forinvoices(whichincludestheIE).
ActiveProject
Both Management Financial
110 *N/A* NotProject Havingtheappropriateskillsetsduring InseveralofBETO'sIBRprojects, BETOneedstoemphasizetheneedtohave
Specific differentphasesofIBRprojectsisvitalto thesestrategicrelationshipswerenot strategicpartnershipsandfinancial
success.Often,theteamthatdevelopedthe sufficientlymaturetomanagea arrangementsfullymaturedatthetimeof
coretechnologydoesnotalsopossessthe successfulprojectandthisledtocost applicationtoaFOAsothattimeisnotlost
skillsetstoscaleuptheprocess.This shareissuesandscheduledelaysdue waitingonselectedRecipientstonegotiate
requiresaligningwithstrategicresourcesthat totheneedtonegotiatethese nondisclosureagreements,financial
possesstherequisiteprojectmanagement, partnerships. commitments,RACIcharts,performance
financialmanagement,business guarantees,liquidateddamages,etc.
development,feedstocksupply,product
marketingandchemicalprocessstartupskills
combinedwiththedesign,construction,
commissioning,startupandtestingexpertise.
Toachieveastrategicfittakestimefor
relationshipstoevolveandbecome
integrated.
ActiveProject
Both Management ProjectTeam 0 0