Electric utility construction: Causes and types of field change orders

Abstract

The electric power industry provides most of the energy for global commerce, and controlling its construction costs is important to provide affordable energy. Controlling original contract costs and any added costs due to change orders requires effective planning and design of projects. While cost overruns due to change orders occur in other industries, the electric power utility industry faces technical complexity, poor understanding of field conditions, lack of jobsite visits, and poor collaboration among stakeholders during design and planning. Although published data exist for costs of change orders in other industries, almost none are available for the electric power sector. To mitigate these problems, project managers must understand these risks, provide better cost forecasts, and take other measures to avoid change orders. Using a descriptive statistical analysis of the project database of an electric utility company, this study addresses the data gap by analyzing the magnitude, frequency, and causes of field change orders of both overhead and underground electrical construction. The results identified nine causes of field change orders (FCOs) during construction. The percentage increases in the electrical construction contract costs appear to be higher than in other industries, which is an alarming finding considering the tendency to bury transmission lines due to fire hazards. The result showed that FCOs with added scopes occurred more frequently in underground projects than in overhead projects. The analysis indicated that most causes of field change orders could be managed during planning and design and through the construction phase. The findings of this study can be used by electric utilities when they convert from overhead to underground systems due to security and climate change factors.