2022 Outlook For Energy and Construction
2022 is officially in full swing, and the future is looking bright. B&W Energy Services is adapting to the changing landscape of what is to come for the energy and construction sectors, and it’s safe to say we’re very excited. We’ve listened to advisors at top firms, and Deloitte’s projections have been particularly insightful. We thought we’d provide you with our forecast of what you can expect from construction and energy this coming year.
Supply Chain Issues Are Causing Construction Delays
“Contractors should be proactive in managing processes and operations that contribute to margins and profitability, adding efficiencies and optimization where possible.”
It’s no secret that the COVID-19 pandemic is continuing to have long-term implications. With pauses in production across so many industries, prices on materials have risen because demand is now so high. So not only is the construction industry facing the highest prices ever seen, getting materials is proving difficult. The market has been volatile, and it does not look to be stopping, so more delays are predicted for the construction industry. This will likely affect the industries B&W works in, and we are prepared to handle problems that may arise. By working with our customers and suppliers, we know that anticipating delays allows us to plan ahead and stay on schedule based on our knowledge and past experiences
Weather Events Are Changing Energy Strategies
“Experts have made it clear that global weather patterns are in uncharted territory, and planners can no longer use the past to predict the future.”
As a Texas company, B&W Energy Services remembers the two-week snowstorm that hit our state in 2021 all too well. But this was not an isolated weather event. Massive weather events like hurricanes, blizzards, and floods have become increasingly intense and unpredictable. The energy sector is becoming acutely aware that change in strategy is desperately needed. Electric utilities are making resiliency planning a crucial part of their strategy with power reliability under the public microscope on a global scale. The world is focusing on replacing and reinforcing how energy is distributed. With funding from public and private utility companies, new plants are being built that are bigger and better than ever. Pre-commissioning and commissioning are booming because of these new ventures.
Clean Energy Is Coming
“As of mid-November 2021, 48 out of 55 US large investor-owned utilities had committed to reduce carbon emissions, many by 2050.”
Depending on how it is harvested, electricity can be a significant carbon producer. The world is seeing a commitment to green initiatives and bettering the planet across almost every industry because it is vital. In 2022, seeing decarbonization plans will become the norm. Utilities will announce their goals and strategies with actionable benchmarks for significantly decreasing their carbon outputs if not eliminating them altogether. With investors watching and consumer support, moving to more sustainable energy sources is not just a fad but the future. While this pivot may be initially uncomfortable, many companies are seeing this as an opportunity to innovate in profitable ways.
Labor Shortages Across The Board Are Affecting Business
“The impact of not filling job openings can negatively affect E&C firms in more ways than one, including project delays and cancellations, projects being scaled back, inability to respond to market needs, losing project bids, and failing to innovate, among others.”
The labor landscape has changed for almost every skill and department that make up businesses. While some industries have been affected more than others, the construction and energy sectors have not been immune to these changes. Safety was always the most critical priority, but navigating how to work safely is a challenge with the pandemic. Many job sites have different standards and procedures so adhering to those requires more labor, time and money. Almost a double whammy with this newfound landscape is labor shortages. Whether the causation is the pandemic driving many people to retire faster than expected, a lack of skilled laborers or more people jumping from company to company, there has been a shift in the available workforce. The impact of this shortage is substantial to the industry as a whole.
At B&W Energy Services, we’re excited about the projects we have coming this year, and we’re even more excited to deliver the innovative services that make our customers successful. Through constant engineering that evolves and improves our processes, we’re looking to continue focusing on safety and development this year. We can’t wait to see what 2022 brings and look forward to continuing to be industry leaders.
See the full reports energy and construction from Deloitte.
