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What makes a good technical advisor?

Find out what separates the report-writers from the valued advisors when it comes to your investment.

Let's find out...

No matter how experienced and well informed you are, every energy infrastructure project is unique and as such having the right set of advisors to support, goes a long way - be it for finance, insurance, tax or technical.
 
At K2 Management we have worked on a wide variety of lenders’ advisor, refinancing, and acquisition due diligence assignments. The staff undertaking these assignments have personal track records which cover dozens if not hundreds of due diligence mandates delivered over several years of prior experience, and almost all of our consultants bring previous “hands-on” project development or construction experience, ranging from developing onshore wind farms in south-east Asia to fulfilling the role of turbine package manager for offshore wind farms.  
 
But what makes a good technical advisor?
1

Effective communication

Working together with clients

Less is more?

Sometimes, less is more. That’s not to say that clear and regular communication isn’t important, this is the fundamental backbone to successful collaboration of course, but effective communication is about making best use of contact time, focusing on the level of detail and volume needed by the client given their needs on timescale, level of existing knowledge and their role on the project (investor, lender, developer, supplier). In essence, it’s the difference between what should be communicated to add value, not just information for information’s sake.

Technical advisors are hired to support those from non-technical fields such as the finance community, or those who need specialist knowledge that they don’t have internal resource for such as developers or suppliers. A 300-page technical report simply adds more time and work for clients to wade through and the detail and doesn’t guarantee understanding.

A good technical advisor will communicate concisely, sorting and structuring information in a way that is both accessible and meaningful to the client.

2

Real world experience

Adding value through project experience

Boots on the ground

Clients engage advisors to identify and mitigate risk to ensure an eyes-open approach to return on investment or cost of debt. It’s one thing to run project data through a risk assessment process delivering a simulation and automated report but what about the human element? 

Ultimately, simulations can support with conducting larger, more complex assessments but as they say, “rubbish in, rubbish out.” As such, a robust risk assessment requires real world experience as part of the process and, in particular, lessons-learned from when things have gone wrong.

The broader this experience, the more value added to the process. Often this is where a technical advisor can provide a wider experience base than even some developers, having had exposure to a higher frequency of projects, in different regions, with different technology, vessels etc. over the same years of experience, due to the nature of consultancy.

Additional value comes from technical advisors who also have significant experience as owner’s engineers, meaning hands on development experience, as well as advisory services.

3. Market awareness

Knowledge is power and a good technical advisor will have a team with a wide background of knowledge, not just from their wide variety of advisory projects, but from previous roles too, be it at a developer, turbine supplier, law firm, investment firm etc.

This solid foundation of knowledge means aspects of the project are seen from more than one viewpoint and plays a big part in how advice and communication are tailored to meet the needs of the various stakeholders.

Currently the renewables market is moving at unprecedented speed, on all fronts; technical, commercial and regulatory.

With the increasing move to auction based support mechanisms and a drive to subsidy free development, there is increasing pressure on reducing costs, which is resulting in innovation in many aspects of projects be it technical, finance or commercial.

Anyone can read industry journals and news or attend events, but nothing can beat hands on involvement for up to the minute understanding of trends, drivers, risks and opportunities. Relying on market understanding from your last project or discussion with advisors 12 or 18 months ago, is already hugely out of date. Good technical advisors see a vast array of projects come across their desks and only at scale can clear trends and potential opportunities be seen.

4

Commercial and technical perspective

More than just a 'technical' advisor

A good technical advisor should not solely focus on the technical aspects of a project, but also balance this with a sound commercial mindset.

An optimised design or specification is great, but not if it’s not cost effective or commercially feasible or will take five times longer to manufacture or install.

As a result, technical advisors must provide robust advice balancing elements of technical design, contracts, timescales, permitting, health and safety, risk, cost, market and supply chain considerations, among others.

Just focusing on the design aspect, would be short-sighted to say the least.

The right contracting strategy for a specific client and project can have a significant positive effect on a project’s success beyond what the purely technical elements can achieve.

Achieving a balance between market conditions, owner needs and lender needs can be challenging without an advisor that brings practical project experience of simultaneously managing such three-way tensions. 

So beware of advisors that want to just focus on the 'technical' aspect of the 'technical advisor' role, that’s only one part of the bigger picture.

Projects in progress

Hear from our clients and consultants

What do they believe makes a good technical advisor?

So what does make a good technical advisor?

All of this broad experience and knowledge, commercial focus, market access and clarity of delivery is what makes a good technical advisor. This unique combination is what allows you to receive robust, well rounded and balanced advice that is up to the minute, flexible in approach and most importantly, adds value..
Will Sheard

Talk technical advisory with Will

Clients and projects

Guiding development and investment with technical advisory

  • Wind
  • Acquisition
  • Due Diligence
  • Onshore wind

Our role on the acquisition of Denmark’s largest onshore wind farm

Utility, AURA Energi’s subsidiary AURA VE, engaged K2 Management to provide due diligence services to support the acquisition of a 50% stake in...

Utility, AURA Energi’s subsidiary AURA VE, engaged K2 Management to provide due diligence services to support the acquisition of a 50% stake in the biggest onshore wind farm in Denmark.

The scope saw the K2M team deliver technical due diligence including full yield analysis and risk mitigation for project longevity. With a strong track record of design and technology review, particularly in the onshore wind landscape, K2M delved into deep analysis of the WTG technical specifications, operational track record, foundation design, electrical balance of plant and grid connection. The team also conducted WTG and site inspections as well as providing a high-level review of the design and architecture of the SCADA system.

With the support of K2M providing a holistic picture, AURA VE was successful in its acquisition of the project estimated to produce 189,000 MW each year.

Klaus Høgh, Head of Project Development at AURA VE, commented “K2 Management is extremely reputable in this field and we knew they would be a great partner for us thanks to their local knowledge and international expertise.”

“They provided a thorough investigation from start to finish, right down to the nuts and bolts of the project. The detailed analysis and comprehensive findings helped to provide us with strong arguments when entering into commercial discussions.”

“It was clear that the team supporting us used their extensive knowledge of international transactions strengthened by knowledge from across the organization to inform their due diligence. With K2 Management, we truly felt in good hands.”

Niels Bitsch, Senior Consultant for K2 Management said, “Our dig deeper approach allowed us to find unique opportunities for AURA VE to present a strong business case as well as optimize assets and mitigate risk in the transaction and beyond.”

  • Offshore
  • Due Diligence
  • Lender's Technical Advisor

Lender’s technical advisor on world’s biggest offshore wind farm

Joint venture partners, SSE and Equinor, appointed the K2 Management team as Lender’s Technical Advisor to Dogger Bank Wind Farm A and B – two out...

Photo Credit: GE Renewable Energy

Joint venture partners, SSE and Equinor, appointed the K2 Management team as Lender’s Technical Advisor to Dogger Bank Wind Farm A and B – two out of three phases that combine to make the largest offshore wind development in the world. 

In this two-year role, K2 Management guided the project partners through the technical elements of the transaction. Particular emphasis was placed on the wind turbine and cable elements, given that this is the first project globally to close using the 13MW GE Haliade-X wind turbine, and an HVDC export system in the UK 

The scope saw the team support the owners through the CfD Round 3 bid process, in which they were successful in 2019 with all three phases. They then delivered due diligence on all technical elements of the Dogger Bank A and B including:  

  • Permitting and environmental 
  • Technical design (civil, electrical, wind turbine, grid connection) 
  • Project participants and project management 
  • Construction contracts and interface management 
  • Operations strategy and contracts 
  • Technical aspects of the financial model
  • Bank grade, independent energy yield assessment 
  • Risk management and contingency sizing.  

Dogger Bank A and B reached financial close in November 2020 and the project owners appointed K2 Management in a further four-year role to complete construction monitoring on both projects.  

Steve Hall, Senior Consultant at K2 Management and project lead on the Lender’s Technical Advisor scope, commented: “K2 Management’s engagement at an early stage in the projects journey to financial close provided project partners with an insight on bankability issues well ahead of timeproviding confidence at bank launch.  

  • Offshore
  • Acquisition
  • Due Diligence

K2 Management advises on bp's first offshore wind venture

K2 Management delivered acquisition due diligence services in support of bp’s first step into the offshore wind market – a 50% stake in Equinor’s...

K2 Management delivered acquisition due diligence services in support of bp’s first step into the offshore wind market – a 50% stake in Equinor’s Empire Wind and Beacon Wind assets.

The full technical due diligence assignment saw K2 Management evaluate all technical aspects of the projects, including project design and technology, construction costs, energy yield and operations strategy.

President, Americas at K2 Management, Lars Andersen, said: “This transaction signals another positive step forward for offshore wind in the US."

"Bringing our local East Coast market knowledge together with our wealth of expertise from offshore wind in Europe, the in-depth nature of our role allowed us to provide comfort to bp on the technical aspects of these projects. I’d like to congratulate the whole team on this successful transaction.”

The Empire Wind lease area will be developed in two phases, the first of which secured an offtake agreement in New York’s first large-scale competitive offshore wind solicitation in 2019.

Beacon Wind is situated off the coast of southern New England. The lease areas have a potential installed capacity of 2GW and 2.4GW, respectively.

  • Offshore
  • Due Diligence

Advising ESB in 50% stake in Neart Na Gaoithe

ESB appointed K2 Management to support them in acquiring a 50% stake in the 448 MW Neart Na Gaoithe offshore wind farm.

ESB appointed K2 Management to support them in acquiring a 50% stake in the 448 MW Neart Na Gaoithe offshore wind farm.

In ESB’s largest stake acquisition in a UK offshore project to date, K2M delivered full scope acquisition technical due diligence, supporting the transaction to financial close.

The scope included analysis of the project’s design, construction contracts and methodology as well as energy yield and cost assumptions and planned operation and maintenance strategy.

Gary Connolly, Offshore Wind Development Manager at ESB, said: “This project is the first time that ESB is taking full construction risk on an offshore wind project and the levels of comfort given by K2 Management’s extensive technical due diligence has enabled us to build a strong business case whilst understanding the key risks."

"The flexibility and responsiveness that K2 Management delivered added significant value when preparing a time-constrained bid.”

Neart Na Gaoithe, now jointly owned 50% by ESB and 50% by EDF Renewables UK, will begin construction in Q1 2020 with an expected operational date of Q1 2023.