By: Mohamed Ahmed, Director, Energy Market Analysis

In the wake of global demand surges following the pandemic, coupled with supply chain disruptions, there has been a notable increase in the costs of raw material commodities. This includes steel, aluminum, copper, and rare earth elements. Given that the production of solar panels and wind turbines is heavily dependent on these raw materials, the escalating costs of such commodities are inflating clean energy prices.

Some clean energy projects may be delayed or cancelled due to the prohibitively high prices of commodities. Comprehensive queue analysis is needed to determine how to best schedule projects that may be delayed or cancelled. Investors may reconsider the profitability of clean energy projects through realistic financial modeling and more expensive projects may prompt deeper investigations into project revenues and costs.

Addressing these fiscal challenges might mean revising certain project procedures. Potential solutions could involve diversifying supply chains, emphasizing sizable projects that yield better profits, thorough project planning, and a sharpened focus on analyzing energy markets.

Effective energy market analysis considers increased commodity pricing and facilitates future development with predictable results. EPE has extensive experience performing energy market analysis studies using customizable computer models to calculate prices at specific locations and market hubs. Collaborating with clients, EPE works to optimize grid integration design by managing cost and congestion factors. Our energy experts use our experience with transmission and system studies to design and implement electrical grids that reflect the current needs of the clients. For more information or to schedule a consultation with EPE, please contact us.