Identification, Mitigation and Management of Risks in Hydropower Projects

Hydro projects are complex infrastructure projects and it is common for disputes to arise between the developer and the contractor. If these disputes are not efficiently addressed and resolved, it can lead to delays in project implementation and higher costs. At the same time, the risks occurring during construction may provide the opportunities which need to be exploited. Indian hydropower projects in particular, have suffered significant time and cost overruns as a result of disputes between developers and contractors. Primary reasons for these disputes are the inadequate technical information and ambiguous allocation of risks in the conventional contract documents. This article presents in brief the criteria followed in identifying the risks, assigning the risks to the party competent to handle the risk, assessing the probability of occurrence of risk and formation of the Risk Matrix for a hydro project.