Paving the Way toward Sustainability and Improving Performance in Renewable Power Projects Through Risk Management Practices
Abstract
Risk management (RM) is an integral and essential component of project management. Addressing two vital aspects is critical: improving project performance and enhancing sustainability. Past studies have illustrated several RM practices without revealing their actual impact on these aspects, especially in addressing the unique characteristics of renewable power project development. This study fills the gaps and aims to explore critical RM practices and examine their influence on project performance and sustainability in developing renewable power projects. The present study identified 25 risk management practices from the existing literature and publicly available documents of 32 leading enterprises in the renewable sector in India. Furthermore, data were collected through a questionnaire survey from 104 renewable sector experts. An underlying structure of these practices was established, and factors were extracted using exploratory factor analysis (EFA). A partial least squares structural equation model (PLS-SEM) was then developed to evaluate their influence on the project’s performance and sustainability parameters. The analysis revealed that RM practices such as systematic risk assessment, recording, and training (F1), inclusive and long-term planning (F2), engaging dedicated risk officers (F3), and identifying, documenting, and updating RM policy (F4) significantly and positively influence the performance and sustainability of renewable power projects. Moreover, the study provides a comprehensive insight into the current RM practices in the renewable power sector. The study enhances the body of knowledge by identifying critical RM practices and quantifying their impact on improving the performance and sustainability of renewable power projects. Adopting these crucial practices would help practitioners enhance the success of the power project, paving the way for achieving the sustainable development goals (SDGs).