Energy construction projects often fail due to poor leadership. Here’s why:
Strong leadership ensures better decision-making, risk management, and team coordination. Companies must prioritize hiring skilled leaders to avoid costly failures and improve project outcomes.
Energy Construction Project Failure Statistics and Leadership Impact
When energy projects lack seasoned leadership, challenges multiply, impacting everything from budgets to timelines. Over 60% of global energy infrastructure projects face cost overruns, turning what should be billion-dollar successes into case studies of failure. These issues often manifest as delays, safety concerns, and difficulties navigating complex project demands.
Inexperienced leaders can make missteps during the planning phase that snowball into major problems during construction. They may underestimate costs, rely on outdated systems, or fail to coordinate effectively with contractors. For projects with budgets over $1 billion, the average delay is a full year, with costs exceeding estimates by 30%. Nuclear projects fare even worse, with cost overruns of 102.5% and schedule delays of 64%.
One major culprit is "optimism bias" - an overly rosy outlook during early planning. This often leads to underestimating costs, hiring contractors based solely on low bids rather than their capabilities, and poor coordination between project partners.
"Problems usually emerge at interfaces. You already have many external interfaces. Avoiding internal interfaces is important for reducing complexity."
- Mike Denning, Senior Executive at INPEX.
A striking example of leadership failure is the V.C. Summer Nuclear Station, where construction was abandoned after $9 billion had already been spent. Key issues included starting construction with only 40% of the designs completed and failing to establish a fully integrated schedule.
| Energy Project Type | Average Cost Overrun |
|---|---|
| Nuclear | 102.5% |
| Hydropower | 36.7% |
| Geothermal | 20.7% |
| Carbon Capture (CCS) | 14.9% |
| Wind Farms | 5.2% |
| Solar Power | Declining trend |
| Source: ScienceDirect/PowerMag 2025 Analysis |
These delays and cost overruns are just the tip of the iceberg - leadership gaps also jeopardize safety and coordination.
Leadership quality directly impacts safety outcomes in high-risk energy environments. Studies show that 96.67% of accidents stem from human factors and unsafe behaviors, both of which are shaped by leadership decisions. Inexperienced leaders often fail to identify life-critical risks, miss chances to correct unsafe practices, and create workplaces where employees hesitate to report hazards.
One tragic example occurred in April 2025 at the Bechtel Port Arthur LNG terminal in Texas. A platform collapse killed three workers due to inadequate oversight and missing safety protocols, such as specialized training and a buddy system.
"In reviewing the incident, we found breakdowns in oversight and supervision - where moments to step in and take corrective action were missed."
- Craig Albert, President of Bechtel.
Strong leadership also fosters psychological safety, empowering employees to report concerns or stop work without fear of retaliation.
"Leadership safety commitment is considered to be the key factor affecting miners' behavior."
- Lixia Niu and Yong Liu, Liaoning Technical University.
Energy projects are inherently complex, requiring technical expertise, strategic planning, and the ability to adapt. Inexperienced leaders often struggle to meet these demands, especially as projects grow in scale. Larger projects - those exceeding 1,561 MW - are statistically more prone to escalating costs and delays.
Balancing environmental, social, and economic goals, managing global supply chains, and navigating shifting regulations are just a few of the challenges leaders face. Without experience, leaders may begin construction before finalizing blueprints or fail to implement integrated scheduling, leading to chaos.
The difference between failure and success is stark. For example, the Darlington Nuclear Generation Station in Ontario, Canada, managed to stay on budget and ahead of schedule as of 2025. This was achieved through "systemic orchestration" and adaptive leadership, where proven practices were integrated into a coherent program management system. Such approaches help mitigate cost escalation, particularly when delays exceed 87.5% of the planned timeline.
Experienced leadership is the cornerstone of aligning all these moving parts, ensuring that projects meet their goals instead of becoming cautionary tales.
What separates a project that meets its deadlines from one riddled with delays? Often, it’s the leadership. Skilled leaders bring a blend of sharp decision-making, interpersonal finesse, and flexibility that goes far beyond textbook knowledge. These traits are especially crucial in massive projects exceeding $5 billion in scope.
In ultralarge energy projects, strong leaders treat their roles like running a business. They take full responsibility for outcomes and make decisive calls, avoiding the pitfalls of procrastination. As Jack Futcher, President and COO of Bechtel, puts it:
"Process does not deliver projects; leadership does, and has to trump process."
- Jack Futcher, President and COO, Bechtel
One key strategy is Project Value Improvement (PVI), where leaders scrutinize every project requirement to identify the "minimum technical solution." This approach separates essential elements from those that are merely optional. For instance, Mike Staun, former associate director of capital management at Procter & Gamble, leveraged Lean Integrated Project Delivery methods to generate $1 billion in value. Targeted PVI sprints helped him and his team focus on what truly mattered.
Modern leaders also harness AI-driven tools to simulate countless execution scenarios in just minutes. These simulations allow them to optimize costs, reduce carbon footprints, and manage resource constraints well before problems arise. Functional premortems, which involve analyzing "what-if" scenarios, further help identify potential pitfalls before reaching the Final Investment Decision stage.
Another game-changer? Moving away from adversarial lump-sum contracts. Instead, collaborative partnerships - where risks and rewards are shared - have improved cost and schedule performance by 15% to 18% on average.
But decision-making alone isn’t enough. Building and leading an effective team is just as critical.
Great leaders know how to create a "one-team" culture, where accountability and collaboration thrive. By adjusting their leadership style - being democratic during planning phases and more directive in crises - they ensure smooth communication and teamwork. Research shows that engaged teams are 21% more productive than disengaged ones.
A prime example is TenneT's "Safety IMPACT" program, launched in May 2024 for the SuedLink and SuedOstLink projects. Partnering with Accenture, TenneT opened safety training centers in Hamburg and Nuremberg. These centers use immersive 3D simulations to prepare workers for large-scale infrastructure challenges. The program’s goal of zero accidents is supported by AI-assisted learning, which can improve skill retention by up to 28%.
Beyond immediate needs, seasoned leaders focus on mentorship, passing down their expertise to nurture the next generation of professionals. With the energy sector facing talent shortages, this commitment to people is essential for the industry’s future. For a deeper dive into workforce challenges, check out our power and energy infrastructure guide.
In addition to decision-making and team-building, leaders must adapt to the evolving energy landscape. The sector is undergoing significant shifts, from the energy transition to supply chain disruptions and labor shortages. Addressing these challenges requires empowering small, cross-functional teams to make decisions, moving away from rigid hierarchies.
"The energy industry has basically been static for a long time... We've now moved from a largely internal, incremental agenda, to a whole set of existential risks and opportunities in front of us."
- Industry CEO
Adaptable leaders aren’t afraid to experiment, learn from failures, and scale successful initiatives quickly. This approach is particularly important when tackling the carbon footprint of construction materials, as nearly 50% of a built asset’s emissions come from embodied carbon in steel, cement, and transportation.
To address labor shortages, leaders are embedding skill-building into daily workflows. They emphasize digital skills, business knowledge, and soft skills like negotiation and conflict resolution. Many are also shifting to service-based workforce models, forming long-term partnerships with firms that deliver results-driven services rather than relying on short-term contractors.
"It's OK for us to make mistakes if we take accountability, fix them, and learn. It would be much worse if we didn't make mistakes, which would tell me that we are not taking risks and are playing too safe."
- CEO of an integrated energy company
This openness to experimentation, combined with transparent communication, helps leaders navigate uncertainty and capitalize on emerging opportunities. These skills not only address the risks inherent in large-scale projects but also transform challenges into pathways for success.
Recruiting top-tier leaders for energy construction projects isn’t as simple as posting a job ad. The best talent rarely browses job boards. Instead, finding the right fit demands targeted outreach, a strategic screening process, and competitive compensation packages that reflect the high-stakes nature of the industry. Addressing staffing challenges on large-scale construction projects is essential to securing the leadership required to handle the complexities and risks of modern energy construction.
The most effective way to connect with experienced leaders is through direct engagement at key industry events. Organizations like the Associated General Contractors (AGC), Construction Management Association of America (CMAA), and Design-Build Institute of America (DBIA) host conferences where seasoned professionals gather. Events such as World of Concrete and CONEXPO-CON/AGG provide excellent platforms to meet candidates who may not be actively seeking new roles but are open to opportunities.
In addition to networking, companies should rethink how they define leadership roles. Instead of vague job descriptions, use a scorecard approach that outlines specific, measurable outcomes. For example, instead of saying "manage project operations", set clear goals like "improve backlog quality within six months." This attracts candidates who are results-driven rather than task-oriented. A structured interview process is also vital. A thorough hiring process might include multiple steps, such as a 30-minute initial screen, a 90-minute technical interview, a two-hour leadership panel, and a half-day site visit to observe how candidates interact with field teams.
Here’s a real-world example: In January 2024, a global mining company managing a $15 billion portfolio overhaul used analytics to assess its workforce needs. The results revealed the need to triple its project team and establish a centralized project management hub, prompting a complete redesign of its hiring strategy.
Proactive outreach is just the start - streamlining the screening process is equally important. Executive-level searches in construction often take 60 to 90 days when handled externally, and up to 120 days for internal efforts. Pre-qualified candidate screening can significantly cut this timeline by focusing on professionals with the right technical and academic credentials. For example, candidates with degrees in construction management or civil engineering and certifications like PMP, CCM, or LEED are often prioritized.
For senior roles such as CEO, COO, or VP of Construction, companies typically look for candidates with 15 to 20 years of experience, including oversight of nine-figure budgets and multi-sector projects. Digital skills are a must - leaders should be proficient in tools like Procore, Autodesk Construction Cloud, and Primavera P6 for scheduling, alongside ERP systems like SAP or Oracle.
To assess accountability, consider narrative-style interview questions. For instance, ask candidates to describe a project failure they managed and the corrective actions they implemented. Or, have them recount how they handled a cost overrun exceeding 10%. These questions test their ability to take ownership and think systematically - qualities that distinguish effective leaders from those who merely follow along.
In today’s market, compensation is often the deciding factor in attracting and retaining top talent. Companies are offering above-market salaries and inflated titles to secure the best candidates. As Jason M. Allen, CEO of Leeward Renewable Energy, explains:
"We are paying above market salaries and often providing titles above experience levels. Once [we have talent] on board, it is a constant fight to retain the top talent due to continued recruitment from others that are doing the same thing." - Jason M. Allen, CEO, Leeward Renewable Energy
To remain competitive, firms must benchmark their salary offers. For example, a VP of Construction at a large company (with over $250 million in annual revenue) typically earns between $220,000 and $350,000, with bonuses ranging from 20% to 50% of their base salary. These bonuses are often tied to metrics like safety, budget adherence, and schedule performance. In the U.S., salaries in renewable energy are roughly 40% higher than in Europe, reflecting the intense demand for skilled professionals.
Long-term incentives (LTIs) are also becoming more common as a retention tool. Smaller developers, for instance, are offering equity stakes in new wind and solar projects to compete with the lucrative packages provided by oil and gas companies.
Non-financial perks shouldn’t be overlooked, either. Flexible work arrangements, remote options, and personalized career development plans are now essential for attracting seasoned leaders. While the energy sector generally excels in pay satisfaction, it often falls short in areas like workplace culture and career growth - factors that can drive turnover. Competitive compensation isn’t just about attracting talent; it’s a cornerstone for retaining leaders and ensuring the success of complex energy projects. For more insights into workforce challenges in this sector, check out our power and energy infrastructure guide.
Securing the right leadership is critical, especially given the staffing challenges in energy construction. The challenge is clear: 63% of construction CEOs struggle to find qualified field managers. On top of that, the looming retirement wave is shrinking the talent pool even further. iRecruit.co steps up to these challenges with a recruitment approach designed specifically for high-stakes energy projects.
iRecruit.co focuses on filling essential construction management roles - positions where even a minor misstep can lead to delays, safety issues, or budget overruns. Their screening process goes far beyond simply reviewing résumés. Instead, it zeroes in on candidates with a proven track record of thriving in high-pressure, regulated environments. This distinction is crucial because there's a big difference between someone who understands a technology and someone who has successfully delivered results in complex, high-risk settings.
The service specializes in recruiting for critical roles like project managers, project executives, cost estimators, schedulers, MEP systems specialists, and commissioning leads. These positions require technical expertise combined with strong leadership and stakeholder management skills. With over 40% of the U.S. construction workforce expected to retire by 2031, companies need to act quickly to secure their leadership pipeline. iRecruit.co’s tailored process ensures a perfect match between leadership skills and project demands. For more details on workforce planning, see their jobs and workforce guide.
iRecruit.co offers flexible pricing options to fit various hiring scenarios, whether you’re filling a single leadership position or staffing an entire team for a major project:
| Plan | Monthly Fee | Success Fee | Best For |
|---|---|---|---|
| 1 Open Role | $0/month | 25% of first year's salary (or 3% monthly for 12 months) | Single critical leadership hire |
| 2 Open Roles | $8,000/month ($4,000 per role) | 20% of first year's salary (or 2% monthly for 12 months) | Mid-sized projects with multiple management needs |
| 3+ Open Roles | $10,500+/month ($3,500 per role) | 20% of first year's salary (or 2% monthly for 12 months) | Large-scale projects requiring comprehensive staffing |
This structure allows companies to adapt their hiring strategy based on urgency, without committing to upfront fees for unfilled roles.
iRecruit.co’s pay-on-hire model minimizes financial risk, ensuring companies only pay for hires that deliver results. This is especially important in a market where companies are putting in two to three times the usual effort - and cost - just to attract talent. Jason M. Allen, CEO of Leeward Renewable Energy, underscores this reality:
"We are spending two to three times the normal effort (and, subsequently, expense) to attract new talent to fill open positions." - Jason M. Allen, CEO, Leeward Renewable Energy
To further reduce risk, iRecruit.co offers a 90-day replacement guarantee. This safeguard ensures that if a hire doesn’t meet the demands of a high-pressure, regulated environment, a replacement will be provided. This is critical in an industry where 61% of U.S. general contractors cite labor shortages as a cause of project delays, and large capital projects often exceed their budgets by 30%. A poor leadership hire can be financially crippling, especially during mobilization. By combining success-based pricing with a solid replacement guarantee, iRecruit.co directly addresses the leadership challenges that can jeopardize energy projects.
Energy construction projects often stumble without strong leadership - 64% fail to meet schedules, and 59% go over budget. These numbers highlight just how crucial effective leadership is in avoiding costly overruns and ensuring project success.
"A good project director can mean the difference between profit and loss." - McKinsey & Company
The evidence is clear: waiting until mobilization to fill critical leadership roles is a risky gamble. With a wave of retirements shrinking the talent pool, companies need to start recruiting early. Beyond technical expertise, leaders must possess essential soft skills like stakeholder management and the ability to navigate the complexities of today's energy projects, from ESG requirements to AI-powered project controls.
Smart hiring practices are a safeguard against risk and financial loss. Delays don’t just slow timelines - they drive up costs dramatically. In fact, 90% of megaprojects see cost overruns exceeding 50%. Addressing these challenges requires a proactive approach to hiring, where leadership capabilities are carefully matched to the demands of each project.
The energy transition calls for leaders who can manage fragmented value chains, establish a strong safety culture from day one, and adapt to rapid industry changes. With the right leadership in place, companies can transform potential setbacks into opportunities for growth. Effective leaders don’t just avoid problems - they enhance efficiency, prioritize safety, and boost profitability throughout every stage of a project. For more insights on building resilient teams, check out our jobs and workforce guide.
Experienced leadership plays a key role in the success of energy construction projects, blending technical know-how with essential people skills. Leaders in this field need to shine in areas like strategic decision-making, team coordination, and problem-solving. At the same time, they must ensure safety protocols are followed, deadlines are met, and budgets are maintained.
Just as critical are soft skills such as clear communication, conflict resolution, and the ability to build trust among diverse teams and stakeholders. Leaders who inspire their teams, adapt to unexpected challenges, and encourage collaboration are better prepared to navigate the complexities of energy projects, leading to smoother operations and stronger results.
Recruiting and keeping skilled leaders in the energy sector isn't something that happens by chance - it takes planning and effort. Companies need to focus on creating a strong leadership pipeline by looking beyond just experience. Instead, they should evaluate candidates based on their potential, ability to adapt, and leadership qualities. Even if someone doesn’t have years of experience, these traits can make them a valuable addition. Sweetening the deal with competitive pay - think above-market salaries - and meaningful job titles can also make a company stand out to top-tier talent.
When it comes to retention, the key lies in creating a workplace that leaders want to stay in. This means fostering a culture that values diversity, encourages professional growth, and supports forward-thinking and flexibility. These elements not only make a company appealing to new hires but also help keep existing leaders engaged and loyal, which is especially important in today’s competitive job market.
Delays and budget overruns in energy construction projects often boil down to a handful of recurring issues. One major culprit is a poorly defined project scope and design, which can lead to constant changes during construction. These changes not only inflate costs but also stretch timelines far beyond initial expectations. Similarly, inaccurate cost estimates at the outset can cause financial headaches as the true scale of the project becomes evident. Add to this unclear contract terms, and you’ve got a recipe for disputes that can drag progress to a crawl.
Another critical factor is the absence of experienced leadership. Without skilled leaders at the helm, projects can suffer from coordination mishaps, sluggish decision-making, and weak risk management. On top of that, complex stakeholder demands, regulatory challenges, and unforeseen technical obstacles can all pile on, creating further delays and ballooning budgets. When these issues converge, they can have a dramatic impact on both the timeline and the financial health of a project.
