Floating solar technology has gained significant attention in recent years as a promising solution for increasing renewable energy generation and mitigating the impacts of climate change. In Asia, where land is at a premium and many countries are highly dependent on fossil fuels, floating solar projects offer a unique opportunity to generate clean energy while maximizing available resources. However, like any technology, floating solar projects come with risks that must be identified and managed throughout the project lifecycle. From weather-related delays during construction to equipment failure and environmental risks during operation, these risks can impact project success and profitability. In this article, we will explore the key risks associated with floating solar projects in Asia during the construction and operational phases, as well as effective risk management strategies to ensure project success.

Floating Solar – Construction Phase Risks

Constructing a floating solar project can be a complex process that involves various risks. Here are some of the common construction phase risks that need to be managed:

Weather-related risks

The construction of floating solar projects in Asia may be impacted by weather events such as typhoons, monsoons, and heavy rainfall. These events can cause delays, damage to equipment, and safety hazards for workers.

Supply chain disruptions

Floating solar projects require a range of materials and equipment, which may need to be sourced from multiple suppliers. Supply chain disruptions, such as shipping delays or material shortages, can impact project schedules and increase costs.

Site preparation risks

Preparing the site for the installation of floating solar panels involves various tasks such as dredging, anchorage installation, and cable laying. Risks associated with these tasks include soil instability, equipment damage, and underwater hazards.

Safety risks

Construction work on floating solar projects involves working at heights, working on water, and working with heavy equipment. Safety risks associated with these activities include falls, drowning, and equipment accidents.

Cost overruns

Construction costs for floating solar projects can quickly add up, particularly if unexpected issues arise. Cost overruns can lead to project delays and reduced profitability.

To manage these construction phase risks, project stakeholders need to implement effective risk management strategies, such as contingency planning, supply chain management, and safety protocols. By addressing these risks early on in the project, stakeholders can minimize the impact of unexpected events and ensure project success.

Operational Phase Risks – Floating Solar

The operational phase of a floating solar project involves the ongoing maintenance, monitoring, and management of the project to ensure that it continues to generate electricity efficiently and safely. Here are some of the common operational phase risks that need to be managed:

Equipment failure

Solar panels, inverters, and other equipment used in floating solar projects can fail due to wear and tear, environmental factors, or manufacturing defects. Equipment failures can lead to reduced power output, downtime, and increased maintenance costs.

Maintenance issues

Proper maintenance of the floating solar project is essential to ensure optimal performance. Maintenance issues, such as corrosion, fouling, or damage to cables, can impact project efficiency and increase costs.

Environmental risks

Floating solar projects are exposed to a range of environmental risks, including wave and wind loads, water quality, and marine life. These risks can impact project efficiency, safety, and environmental compliance.

Safety risks

Ongoing risks associated with working on the water and with electricity can lead to accidents and injuries.

Revenue shortfalls

Operational phase risks can impact the amount of electricity generated by the project, which can result in revenue shortfalls and reduced profitability.

To manage these operational phase risks, project stakeholders need to implement effective maintenance planning, monitoring, and risk management strategies. This includes regular equipment inspections, environmental monitoring, and safety protocols. By addressing these risks early on in the operational phase, stakeholders can ensure the project’s ongoing success and profitability.

Technical Risks

Floating solar projects face various technical risks that must be managed effectively to ensure project success. Some of the common technical risks include:

• Wave and wind loads: Floating solar panels are exposed to wave and wind loads, which can cause excessive motion, leading to stability, and performance issues. Waves and wind can increase the risk of equipment damage, power fluctuations, and reduced power output.
• Corrosion: Saltwater can cause corrosion of the equipment and cables used in floating solar projects, which can lead to equipment failure and increased maintenance costs. Corrosion can also reduce the project’s lifespan, leading to significant financial losses.
• Anchoring issues: The anchoring system used to secure the floating solar panels may be impacted by environmental factors such as waves and currents, which can lead to instability and equipment failure.

To manage these technical risks, effective design and engineering, testing, and monitoring are required. For example, by employing robust anchoring systems, using corrosion-resistant materials, and conducting thorough wave and wind load analyses, project stakeholders can mitigate the technical risks associated with floating solar projects.

Financial Risks

Floating solar projects also come with various financial risks that must be managed effectively. Some of the common financial risks include:

Cost overruns

The construction and operational phases of a floating solar project can be impacted by cost overruns, which can lead to reduced profitability. Cost overruns can occur due to various factors such as supply chain disruptions, weather-related delays, and equipment failures.

Financing issues

Securing financing for floating solar projects can be challenging due to the unique risks associated with this technology. Lenders may be hesitant to finance floating solar projects due to the lack of historical data and the perceived risks associated with the technology.

Revenue shortfalls

Operational phase risks such as equipment failures, maintenance issues, and environmental risks can impact the amount of electricity generated by the project, which can result in revenue shortfalls and reduced profitability.

To manage these financial risks, effective financial planning, risk assessments, and contingency planning are required. For example, by conducting a thorough financial analysis, identifying potential revenue shortfalls, and developing contingency plans, project stakeholders can mitigate the financial risks associated with floating solar projects.

Case Studies

To illustrate the risks associated with floating solar projects in Asia, here are some case studies:

• In 2019, a floating solar project in China was delayed due to severe weather events such as typhoons and heavy rainfall. The project experienced several setbacks, including equipment damage, supply chain disruptions, and increased construction costs.
• In Southeast Asia, a floating solar project experienced equipment failures due to corrosion caused by seawater. The project required significant maintenance and repair work, resulting in increased operating costs and reduced profitability.
• In 2019, Japan’s biggest floating solar project, which was located in a reservoir in Yamakura Dam, suffered a significant loss after a series of typhoons hit the region. The floating solar panels were damaged, and the project experienced delays and downtime due to the severe weather events. The project, which had a capacity of 13.7 MW, was constructed in 2018 and was expected to generate 16,170 MWh of electricity per year, enough to power approximately 4,970 households. However, due to the typhoons and subsequent damage to the floating solar panels, the project’s electricity output was reduced, resulting in revenue shortfalls and reduced profitability.

These case studies highlight the importance of identifying and managing the risks associated with floating solar projects in Asia.

Conclusion

In conclusion, floating solar projects offer a promising solution for increasing renewable energy generation in Asia. However, these projects come with various risks that must be identified and managed effectively across the entire project lifecycle. By implementing effective risk management strategies, including contingency planning, supply chain management, safety protocols, financial planning, and testing, project stakeholders can mitigate the risks associated with floating solar projects. With proper management, floating solar projects can become an essential part of the renewable energy mix in Asia and contribute to a sustainable future.

Should you have any question about floating solar risks and risk management, we are happy to discuss further. Please reach out at leo.c@projectriskinsights.com