– Part Two of a Series: Complex versus Repetitive Projects –
“Predicting rain doesn’t count. Building arks does.” ~ Warren Buffett
Author’s Note: This post will serve as the second of several related blog posts on this topic. This post is meant to examine the notion that some projects are complex and singular in nature while some enjoy repetitive design elements that lend themselves to a more rapid and universal implementation.
Adjectives like “big” and “large” certainly paint a broad picture in one’s mind, but they do not adequately describe a project in reality. Not all “big” projects are created equal. Large and big refer to scale and size but are silent as to relative complexity. Consider the following four types of large energy projects:
Complex Yet Singular Project Example No. 1: Nuclear Generation Facilities – The United States has ninety-four (94) operational nuclear reactors with a combined generating capacity of ninety-seven (97) gigawatts. Some of these reactors are grouped together in multiple unit generating plants, with the Vogtle Plant in Georgia (4.5 GW) and the Palo Verde Plant in Arizona (3.9 GW) being the largest, while many are stand-alone reactors generating on average less than one gigawatt of electricity each. Regardless, these are all “large” facilities.
Almost the entirety of the 97 GW of electricity currently being generated by nuclear reactors in the United States (representing 96% of total nuclear-powered generation) was initially brought online between 1970 and 1990. This period represents the “golden age” of reactor development and building in the country, but it was not to last long. Between 1979 and 1988 sixty-seven (67) planned reactors were cancelled at some stage in their development. At one point, there was a twenty-year gap between 1996 and 2016 that didn’t see a single reactor commissioned in the United States. During this period there were numerous permitted “uprates” of existing facilities allowing for additional power generation capacity to be brought online, but these could only replace the capacity lost to retiring facilities and not meaningfully expand on the percentage share of U.S. electricity generated by nuclear reactors. That percentage share peaked at twenty percent (20%) in 1995 and remained relatively steady through the current period at nineteen percent (19%) of the total electricity generation infrastructure.
Figure 1. U.S. Nuclear Power Additions by Year
Data source: U.S. Energy Information Administration, Preliminary Monthly Electric Generator Inventory, and Georgia Power press release (note: data excludes capacity built and retired prior to 2002).
The outlook for this generating type, however, is not optimistic with the U.S. Energy Information Administration (EIA) projecting that the share of electricity generated by nuclear power would fall to twelve percent (12%) by the year 2050. The majority of this loss of percentage generating share is due to other competing types of generation being able to produce electricity at lower relative cost as well as the technical, financial, and regulatory hurdles facing an operator considering whether to design and build a new reactor site. There have been several announcements over the last six months of companies intending to start design and construction activities on multiple new sites around the nation, but it remains to be seen whether these announcements will actually lead to electrons flowing through wires in a timely manner.
Inherent problems aside, there is no better way to generate electricity than nuclear power when a large quantity is needed to be generated reliably and efficiently. Indeed, several reactors either headed toward the decommissioning process or already in it have been seemingly resurrected by large scale electricity users needing to source power for power hungry data centers (e.g.: Mircrosoft securing an twenty year exclusivity agreement with Constellation Energy to purchase power generated by the nuclear power station formerly known as Three Mile Island – to be renamed the Crane Clean Energy Center when it is scheduled to reopen in 2028). But by their nature nuclear generating facilities are large projects that are bespoke to the time and place in which they are sited, constructed, and operated.
Complex Yet Singular Project Example No. 2: Multiple Industry “Mega-Projects” – Around the world there are energy and infrastructure “mega-projects” of a scale and scope often like none other (at least until the military gets involved). Case in point is Snowy 2.0, formally known as the Snowy Pumped Storage Power Station in New South Wales, Australia. Situated on an earlier, successful pair of hydro dams built in the Snowy Mountains and intended to generate power for Sydney and Canberra (referred to as Snowy 1), this new phase is both an extension and expansion of that earlier project. The reservoir lakes behind each of the existing dams exist at different altitudes and a proposed twenty-seven (27) kilometer tunnel is meant to connect these two bodies. As the water flows through the connecting pipeline, it will power an underground pumped-hydro power station. When water needs to be returned to the high lake (from which the process can begin again), giant electric pumps powered by excess solar and wind generation facilities will provide the necessary power. The project is designed to be an immense power back up system that acts like a battery – absorbing, storing, and dispatching energy which can be accessed at times of peak demand. Once completed, this project is projected to generate and store ten percent (10%) of Australia’s electric power. In theory, this could be one of the largest renewable energy projects in the world if and when operational and stabilize electricity prices nationwide.
At least that is the theory. Since construction began in 2019 the costs associated with this project have continued to skyrocket, the generation and storage projections have been repeatedly revised downwards and then challenged again, and project timelines have been extended with no end in sight. Once a political and industry darling, serious doubts are beginning to manifest as to whether it will ever be completed and brought into operation. It was originally assumed that the project would be in operation by 2024 and was originally assumed to cost $2 billion (Aus. $). A subsequent 2017 feasibility study showed it was theoretically possible but at a cost of closer to $4.5 billion (Aus. $). As of today’s date in 2025, the current cost estimate has risen to $12 billion (Aus. $) with a now hopeful plan to be generating and storing power by 2028. The advanced tunneling technology upon which this project is reliant has been mired in costly breakdowns and has yet to come close to the optimistic assumptions made by its designers.
This is typical of many such mega-projects. The potential rewards are great – if this ever comes online as advertised it could not only provide greater stability to the grid at large but put appreciable downward pressure on electric utility bills as well. But, sadly and perhaps inevitably, very few such projects ever produce as planned. It is far more likely that after years of investment, redesign, political infighting, and wasted effort that this will fizzle out and die a quiet death.
Large But Repetitive Project Example No. 1: Utility Scale Solar Generation Facilities – The largest utility-scale solar generating facilities can be substantial in size as well. The Gemini Solar Project in Nevada (966 MW), the Orion Solar Belt Project in Texas (875 MW) and the Edwards Sanborn Solar and Energy Storage Project in California (864 MW) are each in their own right the largest and biggest solar generating sites in the United States. These are dwarfed by the largest single-site, solar generating facilities located in the Middle East (Mohammed bin Rashid Al Maktoum Solar Park – 2 GW), India (Bhadla Solar Park – 2.2 GW) and China (Talatan Solar Park – 15.6 GW).
Utility scale solar generation sites usually require seven acres of land for every megawatt of electricity generated. This estimate is raised to ten acres when you add in the gates, access roads, cable runs, inverter assemblies, green space setbacks, mineral production set asides, and privacy buffers required to allow the project to exist in reality. This means that the “smallest” utility scale solar generation stations (100 MW) will often require just over 1,000 acres of land for siting purposes. Larger utility scale projects can easily require 3,500 to 4,000 acres. This is an immense land requirement that while somewhat reasonable in the vast wastelands of Nevada, Utah, and Arizona can be a multi-year siting challenge elsewhere in the nation.
Large But Repetitive Project Example No. 2: Interstate Pipeline Runs – The individual well is of course the simplest and most basic element of the oil & gas sector, and it is the case that quite often single wells will be drilled either as initial attempts at exploration or by small companies unable to afford greater financial efforts. Sometimes, either because money and will power ran out or because the drilling results are poor, that single well is all that is ever drilled. But normally an individual well is a part of larger basin or field. Drilling the well and extracting the oil or gas locked within the earth is only the first step in the process. Once produced, the oil or gas has to be collected and then brought to refineries, export terminals, and industrial end users. While this is possible utilizing truck and rail transportation, pipelines are by far the preferred option. The American Petroleum Institute states that there are 190,000 miles of pipelines carrying liquid products (comprised of crude oil, natural gas liquids, and refined products) and over 2.4 million miles of natural gas pipelines in the nation. There is an incredibly large and efficient transport system under our roads, farms and pastures that continues to reliably and safely move products 24/7/365.
As many pipelines as currently exist in the United States, there is always a need for expanded capacity and entirely new lines connecting new production sites with new markets. As new fields and plays are explored and then brought into production the extracted product has to be brought to the refineries and export terminals when its value can be realized and enhanced. Many of these pipelines serve to connect the United States to the production fields of its immediate neighbors and to the global markets available for these products. While there is always a natural ebb and flow as to the number of projects completed in a given year, the nation is constantly adding new lines and capacity (See Figure 2).
Figure 2. Recent U.S. Pipeline Additions by Type
While many of these pipelines are short connector lines, every year there are several large, interstate or intrastate lines that can span hundreds of miles. Many thousands of individual tracts of land will be affected by these new and expanded rights-of-way and even with the federal condemnation rights accorded to a grant of common carrier status these projects are complicated, expensive, and of a long duration. Even with the benefit of eminent domain, the pipeline developer will have to spend years securing the necessary regulatory approvals, trying to reach a consensus as to fair market value for each tract, contacting landowners to negotiate passage, and then years more actually building the pipeline itself. Owing to the linear distance many of these pipelines traverse, even laying a relatively small 36” pipeline through a 50’ right-of-way is a massively complex endeavor.
What it Takes to Build Large Projects
Each of these project types would be considered large undertakings of any company or entity choosing to bring such an endeavor into the world. None of these can be planned, sited, constructed and brought into operation either quickly or cheaply. All require immense amounts of capital, both human and financial. But there is a fundamental difference between the first two and the latter two that cannot be ignored. A nuclear power plant and a “mega-project” are each single, massive endeavors while a utility scale solar generation facility or a large interstate pipeline, while large in scope as well, are to a great extent a repetitive collection of smaller sub-units brought together to form a larger combined endeavor.
This distinction is massive in its importance and implications. The first two are like walking into a casino and letting everything ride on black. The latter two are akin to rummaging through a bin full of Legos. Large projects which are singular in conception and design can have a tremendous impact if and when successful, but they naturally have a very onerous gestation and low probability of success. The following are just some of the headwinds and concerns that must be appreciated and planned for when attempting large scale projects of a singular nature juxtaposed to the tailwinds often enjoyed by large yet repetitive project:
1. Clarity in Forecasting
Complex and Singular Projects – “The best laid plans of mice and men often go awry…” (Robert Burns – To a Mouse) a tremendous amount of time, thought, and money goes into trying to adequately plan out and schedule mega projects, but for a myriad of reasons these plans and schedules almost never hold up. These are monumental undertakings and the sheer number of assumptions upon which planners must rely make it almost inevitable that mistakes will happen. Estimates and assumptions are usually based on past project experiences which are then extrapolated forward, but the unique and forward-looking nature of these types of projects make it very difficult to find reasonable anchor points from which to start the analysis. This tends to make any projections which rely on these flawed anchor points inherently flawed themselves. In order to accomplish these types of projects only the largest and most sophisticated companies can be utilized, but often entities operating at this scale require a truly byzantine bureaucracy that can create its own project level impacts. It is essentially a given that these types of mega projects will at best suffer cost over runs and delays and at worst find themselves so hopelessly mired in confusion and stagnation that they are abandoned.
Large but Repetitive Projects – There are certainly schedules to be built, many obstacles to overcome and equipment and vendor lead times to respect, but these types of projects lend themselves to actually seeing the light of day. In a basic sense, they are simpler in nature and able to be broken down into their constituent parts. This in turn allows designers and developers to identify and get ahead of problems thereby allowing the project to continue making forward progress.
2. Siting Requirements
Complex and Singular Projects – The site selection must be perfect. These are necessarily complex projects that cannot survive either the presence of conditions adverse to their existence (e.g.: changes to the regulatory regime, challenges from well-organized adverse stakeholder groups, etc.) or the absence of conditions necessary to it (e.g.: privacy set backs, presence of ample water, etc.). As these types of projects evolve through their development process, they typically require additional acreage and cannot survive their footprint being reduced. Many of these projects, such as with Snowy 2.0, must be sited in a specific location or they will not work. All of this puts a tremendous burden on those tasked with securing the acreage necessary to site the project. If the necessary site cannot be provided, then the project dies on the white board.
Large but Repetitive Projects – The site selection will still be difficult and fraught with potential jeopardy, but there will be some flexibility permitted as the project develops and responds to obstacles in its path; obstacles both literal and figurative. Pipeline projects endure near constant reroutes and the longer the project the higher the number of reroutes. When a large utility-scale solar generation facility runs into difficulties with required regulatory set offs or underlying mineral interests the best and most expedient solution is often to negotiate with directly adjacent surface owners for additional acreage. There is a comparative forgiveness to the siting process on these sorts of projects that just is not available to their more complex cousins.
3. Access to Financial Capital
Complex and Singular Projects – Sometimes the wind blows this way and sometimes it blows the other way and quite often investment dollars and government funding change with it over time. Mega projects require an immense amount of stable funding the suspension, curtailment, or absence of which can terminate the project. Even the mere shadow of uncertainty created when governmental and private investment decision makers begin to hesitate can destroy a project. Private investment comes with an expectation of return within a reasonable time frame and government support is predicated on being able to convince the public at large that the project still maintains a value to society. Ever stretching time frames can jeopardize both of these fragile expectations and the effect on the project can be terminal.
Large but Repetitive Projects – Investors like predictable returns. Utilities and governments like certainty. Developers like achievable milestones. It is easier for a repetitive style project to provide the sort of predictable timelines and measurable successes that these types of stakeholder’s demand. Large projects have similarly large price tags. So large that funding will not be offered in a single lump sum, but rather in smaller tranches spread through the length of the project ideally following the successful completion of targeted milestones. This greater predictability and achievability make it easier to secure funding for a large, repetitive project than for their more complex cousins and since funding is the essential source of one’s existence it becomes far more likely that these sorts of projects get built.
4. Access to Qualified Human Capital
Complex and Singular Projects – Projects do not build themselves and this sort of endeavor is necessarily complicated. When designing and constructing a nuclear reactor you cannot hire someone off the street or post to a series of routine job boards. There is an immense amount of education and experience required to allow a worker to develop the required skills to be considered useful and productive to the project. Likewise, those in management, oversight, and quality control must have spent years honing their skills and developing a mastery of what will be expected of them in the coming project. Without this there is a high likelihood that the project will at some point slide off the rails at great cost to budget and schedule. Finding, attracting, and retaining the services of a suitable number of qualified individuals is no small task and once you do there is likely no beneficial follow-on impact for subsequent projects located far away. Building a nuclear power plant in California requires investment in local human capital in California. When the next nuclear power plant is to be situated in Tennessee the process must begin anew with very little credit given for the efforts made half a continent away on the previous mega project.
From a land acquisition standpoint, I believe that 75% to 80% of a competent land agent’s skills are fully transferrable between sectors in the energy industry. Projects like this rely on the other 20%. There are very few in the land industry capable and qualified to work these projects and so the siting process becomes far more difficult.
Large but Repetitive Projects – As stated above, people design and build projects (at least until A.I. and our robot overlords take over) but these sorts of projects are far more forgiving as to work force needs then their more complex counterparts. It takes less time to find and train a new worker to install a solar panel or operate the machinery digging the trench for the pipeline than it does to find a worker who can achieve the skill and precision necessary to install the control rods into a nuclear reactor. Because of this distinction, workforces for repetitive projects can be hired locally and trained in a reasonable amount of time at a fraction of the cost and to a somewhat lesser degree of precision than would needed to design, build, and operate a more complex project. This process can also be repeated with minimal risk of failure at other locations far from the original project site allowing for new project teams to be created and avoiding the cost and difficulty having to mobilize and transfer a single hyper-specialized work force.
Likewise, on the land acquisition side, if you have the ability to negotiate a mineral lease leading to the drilling of an oil well you likely also have the ability to negotiate and understand the terms of a lease leading to a wind turbine. Both end goals require the negotiation of surface use agreements. Both require at a core level an agent you can earn and retain the trust of the lessor.
5. Reliance on Technological Advancements
Complex and Singular Projects – Large projects of these sorts tend to push toward the cutting edge of technology. When successful this is wonderful as it advances what is possible in both engineering and society at large, but the reality is that not all new technologies work and many of those that eventually can be made to work take years and vast sums to perfect. This can make stable project development difficult at best. Lead times when ordering equipment can be exceedingly difficult to predict when the piece is bespoke and very difficult to manufacture or, worse, being designed, invented, and built for the first time. What does a missed delivery date mean to the project? Concepts that work on a whiteboard or in a lab do not always translate well or quickly to the real world without a lengthy and costly break-in period. Finally, and unfortunately, some things just cannot be made to work, and some promises cannot be kept.
Large but Repetitive Projects – It would be wrong to say that these sorts of projects only rely on “cookie-cutter” methods and existing off the shelf technology. Even the simplest of these projects will look to include technological and methodological advancements when project issues demand. But, whenever and wherever possible, these projects will be designed to utilize existing technologies and processes that can be deployed repetitively. The 36” diameter pipe to be utilized in Mile No. 47 of the pipeline is likely very similar to the 36” diameter pipe to be utilized on Mile No. 102.
This leads to a simplified and reliable design process, greater efficiency during construction, and a more dependable result when completed. The likelihood that the technology utilized in these types of projects will work is far greater than when complicated and newly invented technology is utilized on large, complex projects.
6. Organizational Alignment
Complex and Singular Projects – These projects are incredibly difficult to conceive, design, and construct under the best of circumstances. They require, in part, complete intra and inter organizational alignment among all entities involved with the project. There can be no internal dissent within companies as the resulting loss of efficiency and sense of purpose would likely make it very difficult to achieve the already lofty project aims. Further, all third-party vendors have to work together efficiently in order to allow the project a chance to succeed. Not only are the projects as a whole incredibly complex, but their constituent parts, for which the third-party vendors bear responsibility, are as well. There is always the possibility that vendors could easily blame other vendors or general system chaos for their failures. This refusal to take responsibility for the efficiency and success of one’s own part in the endeavor can easily lead to the catastrophic failure of the endeavor as a whole.
Large but Repetitive Projects – While these types of projects are by no means simple or guaranteed to succeed, it is possible for the controlling entity to either develop several of them simultaneously or even spread some of their focus on other organizational goals. It is also possible for associated vendors to be assigned mutually exclusive tasks and phases of the project that can be worked and monitored separately without too much concern as to rivalry or interference between vendors infecting the project. The vendors can themselves split organizational focus on multiple projects without causing undue harm to these types of projects. This allowance for split focus makes large, repetitive projects far more likely to succeed since, purely for reasons of survival, companies feel more confident in spreading their efforts and investment risks across multiple projects than in rolling the dice on a single mega project of unimaginable complexity.
Concluding Thoughts
So, which type of project do we as a society get behind? Do we invest in large scale mega projects, or do we choose the “safer” route and churn out large repetitive projects as fast as we can? As was the subject of a previous blog post (The Value of Strength: Understanding the Role of Land Acquisition to Energy Independence, Security and Dominance), we should as a nation do both. In fact, we need to do both.
The United States needs all the reliable and reasonably cost-efficient power that we can get. That means that we need every fossil fuel molecule that we can produce just as much as we need every electron of electricity that we can generate. Expanding the nation’s pipeline carrying capacity to connect wells with markets and refineries makes sense. For over a century and a half oil and natural gas have powered the modern world. Natural gas power stations will provide a tremendous and expanding share of the nation’s power generation capacity in the coming decades. Likewise, renewable energy sources have transitioned from a boutique experiment to a provider of a significant percentage of the nation’s electricity supply. On average, twenty percent (20%) of the nation’s electricity is generated by either a solar or wind generation facility with some states significantly above that percentage. Both oil & gas projects and renewable energy projects of the type referenced above are repetitive style projects that can be conceived, planned, sited and built reliably and then repeated again and again to provide a stable base level of power and electricity to meet the nation’s needs.
But at the same time, it is axiomatic that if you are not growing you are in fact dying. This is as true for nations as it is for individuals and corporations. Large complex projects allow individuals, companies, and by extension nations, to innovate and to push the boundaries of what is currently possible. History has typically favored the entity who controlled the newest and most innovative technological advancements of their day and there is no reason to think that the future will change that. Maybe Australia won’t be able to bring Snowy 2.0 online, but wouldn’t it be great if they could show the world a new way to generate that much electricity for so little ongoing cost. And perhaps Westinghouse was overly optimistic when they declared their intent to build ten entirely new nuclear power generation facilities in the coming two decades, but we certainly do need the massive amount of power those reactors could generate to supply our proposed data centers and automated manufacturing centers.
So, now it gets hard… We need to find a way to do both if we want to continue to sit atop the world’s economic, technological, and resource hierarchy. It’s worth the effort, it’s the best seat in the house.
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