Preventing renewables project delays: Navigating a new era of supply chains, contracts, and community

Australia’s ambitious target of 82% renewables by 2030 is under threat as project developers across the nation grapple with mounting delays. As of May 2025, supply chain disruptions, labour shortages, and regulatory hurdles have converged to slow progress, increasing costs, dampening investor confidence, and pushing back timelines.

A prime example is the Snowy 2.0 pumped hydro project. Initially forecast for completion in 2021 with a $2 billion budget, the project is now expected to become operational in 2028 at a revised cost of $12 billion. A 19-month stoppage due to a tunnel boring machine becoming immobilised by geological conditions was just one of many compounding delays, alongside industrial disputes and safety issues. This high-profile project serves as a cautionary tale for others in the pipeline.

Energy Insights spoke to a range of developers, legal experts, and energy leaders to find out more about these compounding issues. They warn that unless strategic reforms are made across procurement, contracts, and community engagement, Australia risks falling short of its renewable targets.

Supply chain squeeze and US tariffs

Supply chain fragility is one of the biggest challenges facing project developers today — particularly in light of new US tariffs.

James Allt-Graham, Partner at supply chain advisory firm Trace Consultants, warns the tariffs could affect the Australian context.

“Cost pressures and sourcing challenges may compel developers to pivot to alternative suppliers, introducing longer lead times and regulatory complexity, particularly when navigating rules-of-origin issues,” he said. His advice: diversify supply chains, take advantage of free trade agreements, and lock in early procurement to mitigate risk.

Australia’s overreliance on imported components, particularly from Asia, combined with port bottlenecks and fragmented state regulations, is significantly hampering project timelines. According to Allt-Graham, “Grid connection delays further compound uncertainty, often stretching project timelines by years.”

Strategic supply chain management is therefore non-negotiable. Lessons from the National Broadband Network rollout highlight the need for proactive planning and visibility. “Renewables projects can avoid similar pitfalls through strategic, collaborative, and forward-looking supply chain planning,” Allt-Graham said.

To address these issues, the sector should pursue a coordinated strategy that includes incentivising local manufacturing, accelerating workforce development, securing early procurement of critical components, and streamlining regulatory approvals — particularly around grid access — to enable timely and efficient project delivery.

Smarter contracting for smoother execution

Andrew Fry, Major Projects and Construction Partner at Clayton Utz, stresses that timely delivery is not just about logistics — it starts with contracts.

“Preventing delays is about careful planning and interface management, allowing appropriate contingencies in the program and finding the right mix of commercial incentives,” he said. Fry sees a growing shift toward collaborative contracting models and early contractor involvement, particularly as Australia’s 2030 targets loom closer.

Clear contracts also streamline dispute resolution and reduce project risk. “Early warning procedures, layered governance with clear escalation pathways, shared project objectives, relationship principles and dispute avoidance boards or issue resolution teams can all assist in earlier and progressive resolution of differences, and avoiding a snowballing effect,” Fry explained.

Importantly, he highlights a mismatch between some contract structures and the current tight market for renewable supply chains. “The supply chain for the renewables sector is ‘hot’ and will continue to be for some years,” Fry noted. Contracts that do not account for these market dynamics risk driving up costs and introducing unnecessary delays.

Early procurement of critical materials, flexible contracting, and diversified supplier strategies are some of the best ways to prevent delays. By securing key components in advance and incorporating risk-sharing mechanisms like ‘rise and fall’ clauses, developers can better manage price volatility and supply uncertainty.

Tiered supplier strategies, local sourcing where feasible, and digital procurement tools all contribute to greater resilience and visibility. South Australia's success with large-scale renewables underscores the value of proactive procurement, combined with strong government backing and agile supply chain execution.

Aligning regulation and community expectations

Beyond supply and contracting issues, renewable projects also face hurdles in regulatory approval and social licence. Andrew Linnie, AusNet’s Executive General Manager of Distribution, called for streamlined approvals and better regulatory certainty — particularly for Renewable Energy Zones (REZ).

A more agile regulatory process that balances scrutiny with timely approvals is essential, he said. Additionally, early and transparent community engagement must be embedded into project planning. “For this to be genuine, a suitable level of certainty that the project will proceed is required,” he added.

Community buy-in isn’t just a box-ticking exercise — it’s a strategic necessity. James Katsikas, CEO of EDF Australia, echoed this, saying, “To secure competitive financing and robust EPC costs, we need to invest in early works and community engagement from day one. This builds trust and reduces the risk of unforeseen challenges during construction. But it takes time and thoughtful planning.”

Katsikas believes planning laws need to evolve. “Federal and state planning frameworks are often too rigid,” he said. “We need regulatory approaches that are agile enough to accommodate discoveries made during development without compromising project timelines. It’s about finding a balance between thorough risk management and timely delivery.”

Building institutional support and coordination

In Western Australia, the state government has launched PoweringWA to help steer the energy transition. Jai Thomas is WA Deputy Director General – Coordinator of Energy and leads Energy Policy WA, a group within the Department of Energy, Mines, Industry Regulation and Safety. He emphasised the importance of cross-sector coordination.

“Delivering new renewable projects at scale presents a multitude of challenges, and we understand that many of these challenges are interlinked and multi-faceted,” Thomas said. PoweringWA has been set up by the WA Government to work with state agencies, local governments, and communities to reduce delivery barriers and streamline engagement.

This collaborative approach includes supporting Local Government Authorities (LGAs) with best-practice engagement guides and addressing barriers identified by developers.

Planning ahead for distribution and network connections

Grid integration is often overlooked until it causes costly setbacks.

Glenn Springall, General Manager of Renewables and Distributed Energy at Energy Queensland, cautions that earlier engagement with distribution networks can significantly improve success rates for project connections.

“When considering projects that interface or depend on the distribution network, the earlier a project can engage with the distribution network the greater chance of success,” he said.

He encourages developers to familiarise themselves with network-specific guidelines very early in the process to prevent costly delays later on.

Coordinated action is needed

Preventing delays in Australia’s renewable rollout is not just about solving one problem — it requires a multi-pronged approach. From supply chains to contracts, from regulation to community consultation, each element of the delivery ecosystem must align toward common goals.

Allt-Graham summed it up succinctly:

“A cohesive risk management approach that integrates contract, procurement, and supply chain strategies is essential to navigating the complex challenges facing renewable projects.” 

Government support, through mechanisms like the Capacity Investment Scheme, combined with a focus on sustainable procurement and innovation, is critical to reduce delivery risk while positioning Australia as a leader in the global energy transition.

In a sector racing against the clock, the path to 82 per cent renewables will depend on how effectively stakeholders collaborate, innovate, and act now.