What is renewable asset management and what can emerging markets learn?
Renewable asset management tracks and manages a physical plant, such as a wind or solar farm through all the stages of its life cycle.
Successful renewable asset management ensures the seamless collection of all data, documents, milestones, and events for the lifecycle of this asset.
A wind asset for example has a life expectancy of at least 12-15 years and professional lifecycle management solution will help to service the asset correctly and efficiently during that time period. They can even extend the duration of operation. In addition, a well documented asset is likely to sell at better conditions or be refinanced at better terms.
Here are some ways that emerging markets like Latin America (LATAM) can learn from the trial and errors of older markets like Europe and North America. We’ve outlined some of the basics in this article.
What does a renewable energy asset manager do?
Renewable asset managers are responsible for managing the obligations from a wide range of non-standard project documents, such as Power Purchase Agreements (PPAs), leases, financial agreements and contractor agreements, like operations and maintenance (O&M).
Asset managers need to understand the details of the agreements, the party obligations and deadlines. Some common tasks asset managers may face include regulatory filings, solve commercial and technical issues, monitor performance, create invoices, make payments, renew contracts, issue certificates, interact with customers and vendors, track warranties, insurance or legal claims, prepare and analyze budgets and submit reports to investors and banks.
As your portfolio grows with the renewable industry, optimizing your efficiency is as important as completing these asset management tasks.
Is asset management the same as O&M?
Renewable asset management is a term that can be confusing: many people in the industry think of it as operations and maintenance of renewable energy plants.
Instead, asset management consists of the financial, commercial and administrative activities necessary to ensure the optimization of the entire lifecycle of an asset. As the industry has grown so have the responsibilities of renewable energy asset managers.
Asset managers are realizing that documenting all of this information on spreadsheets is no longer cost effective in the growing industry. The increasingly complex and constantly changing legal environment, makes the highest level of organization and transparency necessary for this industry to succeed.
Giving everyone on the a team full view and transparency of all assets at all times is critical. Everything from the compliance obligations to analyzing performance data is now in the realm of asset management.
The growing market for energy management solutions has sprouted an industry of software solutions like BluePoint. That provide asset managers and owners with a suite of tools necessary to centralize and document all asset information and optimize management processes. Bridging the gap between people, data, and projects in the organization.
Why is renewable energy management important?
Investors in solar assets primarily want to control any potential risks, while ensuring that they obtain their expected returns.
This is why an asset manager has to ensure that all critical information from the project documents to compliance are met in a timely and accurate manner. Otherwise, it puts companies at risk for potentially damaging legal and financial implications.
What can emerging Solar and Wind markets learn from more established ones?
Emerging markets, like LATAM, can learn a lot from older renewable markets in Europe and North America that have experienced some of the trial and errors of solar and wind asset management. Although, each market will have its unique requirements, there are some general best practices and resources that can keep you ahead of your competition.
Legislation and early shifts in newer markets will require close and accurate management. Being aware of some best practices in contract management and compliance management will put your company at a huge advantage and allow you to scale. Missing key obligations could result in a fine or default, simple measures can be taken to ensure you stay organized and ahead of schedule. Building scalable management practices from the beginning will allow your company to thrive even with increased pressure. This means having a strict audit trail, documenting, and centralizing data.
Need more info?
Download our ebook, The Essential Guide to Renewable Asset Management, to get more insights and information.