POWER PLANT TECHNICAL DUE DILIGENCE: THE IMPORTANCE AND PROCESS

In the energy industry, investing in a power plant project is a strategic decision that requires careful evaluation. An essential part of this process is conducting a comprehensive technical evaluation. This not only helps the investor gain a better understanding of the feasibility and potential of the project but also ensures that technical factors are carefully considered.

Technical due diligence plays a decisive role in the success of every project, from ensuring safety and compliance to optimizing efficiency and cost. With quality and capability indicators, as well as experience in evaluating various projects, POM can support owners in gaining a comprehensive and detailed technical perspective.

What is a Power Plant Technical Due Diligence?

A Power Plant Technical Due Diligence is the process of assessing, inspecting, and ensuring the feasibility, performance, and safety of technical factors in the construction, operation, and maintenance of the power plant.

Technical Due Diligence provides in-depth analysis of the strengths and weaknesses of the power plant, giving the owner a basis to ensure the feasibility of their investments.

When is a Power Plant Technical Due Diligence needed?

Before engaging in a M&A transaction of a power plant, relevant parties often conduct a technical due diligence to ensure they have a clear understanding of the technical condition of the plant.

Additionally, regulations and technical standards related to safety, environment, and operation may change over time, so a technical due diligence may be conducted to ensure that the power plant complies with the latest requirements.

Why is a Power Plant Technical Due Diligence necessary?

There are several reasons why a Power Plant Technical Due Diligence is necessary. Here are some specific reasons:

• Safety guarantee: A Technical Due Diligence helps identify and minimize risks related to occupational safety, the environment, and the surrounding community. Therefore, project owner can ensure that the plant operates safely and complies with legal regulations.
• Performance evaluation: A Technical Due Diligence helps project owner assess the operational performance of the power plant, operation processes, equipment, and systems. This serves as a basis for the owner to implement measures to minimize waste, increase productivity, and improve operational efficiency.
• Performance evaluation: A Technical Due Diligence helps project owner assess the operational performance of the power plant, operation processes, equipment, and systems. This serves as a basis for the owner to implement measures to minimize waste, increase productivity, and improve operational efficiency.
• Risk assesment: A Technical Due Diligence helps identify and assess risks related to the operation and maintenance of the power plant. This helps project owners, managers, and staff understand potential hazards and implement preventive measures.
• Decision-making support: When making investment decisions for a new power plant or expanding an existing one, a Technical Due Diligence provides crucial information for stakeholders to understand the technical feasibility of the project and make accurate decisions.

Benefits of Technical Due Diligence for power plants

Who performs Power Plant Technical Due Diligence?

The Power Plant Technical Due Diligence is typically carried out by a team of experts with in-depth knowledge and experience in relevant fields. Some key roles in the technical due diligence process include:

• Project management experts;

• Electrical engineers;

• Mechanical engineers;

• Construction engineers;

• Environmental engineers;

• Safety engineers;

• Renewable energy experts.

These experts work together to gather information, conduct inspections and assessments, and then generate a report on the results of the technical due diligence. The personnel involved in the process need to have sufficient experience and knowledge to ensure the integrity and accuracy of the report.

In the role of a consultant, POM’s personnel always ensure extensive knowledge in the field of technical due diligence, ensuring high quality and accuracy in evaluating the technical factors of power plant projects.

Additionally, as a member unit, POM also receives support from industry-leading experts from the Power Engineering Consulting Joint Stock Company 2 (PECC2), with 40 years of experience in the energy sector.

The importance of Power Plant Technical Due Diligence

During a M&A process, power plant technical due diligence plays a crucial role in ensuring that owners have a comprehensive view of the technical condition of the assets they are acquiring or merging with.

Technical due diligence helps owners ensure that the assets they are acquiring or merging with have all the necessary technical information, avoiding potential risks related to purchasing assets with technical issues, thereby ensuring the integrity and value of the M&A transaction, while highlighting the issues that need to be addressed and opportunities for future development.

By providing detailed and reliable information on the technical condition of the power plant, technical due diligence helps owners make informed and well-founded investment decisions. This helps them ensure that they are investing in assets with real potential and value.

Power Plant Technical Due Diligence process at POM

• Collect information, and data, and conduct on-site project surveys;

• Evaluate the design, and technology of the power plant;

• Develop a detailed evaluation checklist focusing on customer requirements and economic and technical criteria;

• Conduct in-depth evaluations and prepare specialized reports;

Complete the technical due diligence project report to meet customer requirements.

Technical Due Diligence process of the Power Plant at POM

If you are looking for professional and reliable technical due diligence services for power plants, please contact us today. With a team of experienced experts and deep industry knowledge, we are committed to providing you with the highest quality technical due diligence services, helping you make smart and effective investment decisions.