ENGINEERING PROJECT 2

Risk Assessment of Project

Delays in the Construction of
Hydropower Plants: A Case
Study of Indonesian National
Electricity Companies

Rendhi Maulana
SP1085046
Master in Engineering
Management
Structure C
 BACKGROUN PROBLEM
D STATEMENT
• Indonesia’s electricity demand increases by 6.9%
per year, while fossil fuel availability declines.
• The Indonesian’s government targets 31% New
& Renewable Energy (NRE) by 2050 to ensure
energy sustainability.
• Currently, with the additional demand reaching
501 TWh in RUPTL 2025-2034, PLN plans to
develop hydropower plants (including pump
storage) with a total capacity of 16 GW, which
is equivalent to 224 LNG cargoes.

• From the historical implementation data in RUPTL

2021-2030, the on-time completion rate stands at
only 27%, while 73% of projects experienced
delays ranging from 1 year to more than 7 years.
• The delays in Hydropower (PLTA) projects under
the RUPTL 2025-2034 can be mitigated by adding
or leasing gas power plants. However, this
mitigation requires Rp 20.42 trillion for
leasing costs, Rp 40.51 trillion for fuel
costs, and a fuel supply equivalent to 90 LNG
cargoes or 7.66 million kL of fuel oil (BBM).
RESEARCH FRAMEWORK
House of Risk

H
Risk
Identification

Risk Analysis Project Delay

Problem statement
Risk Mitigation
Research Objective

Prioritize Mitigation &

Identify & Analyze
Systematically Recommendation

RO 1 RO 2 RO 3
To systematically identify and To evaluate and rank the critical To develop targeted mitigation
analyse the specific risk events and risk causes based on their impact strategies and propose practical
their root causes contributing to and likelihood, using Aggregate recommendations for managing high-
project delays in hydropower plant Risk Potential (ARP) and priority delay risks, including action
projects in Indonesia, using the effectiveness-to-difficulty ratio plans to reduce their occurrence and
House of Risk (HOR) method (ETD) as quantitative metrics impact
RESEARCH SCOPE
1. There were no changes in business processes and policies at the
company during the research.
2. This research focuses exclusively on the assessment and
mitigation of delay-related risks, excluding broader operational
challenges.
3. The object of research is a hydropower plant construction project.
4. Research limited on Indonesian National Electricity Company (PT
PLN) scope
LITERATURE REVIEW
RISK MANAGEMENT HOUSE OF RISK
LITERATURE REVIEW (PREVIOUS RESEARCH)
No Title of Article or Journal Author(s) Year Published Key Studies and Focuses Findings and Limitations
Delay in material supply, poor risk assessment, subcontractor
Problems Causing Delays and Risk Factors in The study focuses on delays in welding-related
1 Asa Prateepasen, Adisak Aumpiem 2021 performance, frequent design changes, lack of qualified staff, poor
Welding Construction Projects of Thailand construction projects in Thailand.
project management

This paper discusses mega road projects in

Risk and Stakeholder Management in Mega Poor stakeholder identification, improper risk management, poor Bahrain, focusing on how inadequate
2 B. A. Ali Mohammed 2023
Projects: Beyond the Realms of Theory risk assessment, public interference stakeholder management and improper risk
management lead to delays

Applied House of Risk, Poor stakeholder identification, improper HVAC system installation in an offshore oil
Gunawan Kunto Bhasworo, Ervina
3 Delay Identification of the HVAC Project 2020 risk management, poor risk assessment, public interference, Poor- platform project, focusing on procurement and
Ahyudanari
quality shop and coordination drawings, Weather constraints installation delays.

Identified 14 risk events and 15 risk agents;

Application of House of Risk (HOR) Models
Doddy Arief Wibowo, Ervina Procurement risk identification, supply chain risk agents, HOR prioritized 3 main mitigation actions. Limitations
4 for Risk Mitigation of Procurement in the 2020
Ahyudanari Phase 1 & 2 analysis, mitigation strategy based on ARP and ETDk include focus only on procurement risks and no
Balikpapan Samarinda Toll Road Project
longitudinal implementation analysis.

BRI plays a transformative role in shaping a

The Impact of Energy Cooperation and the Examines how China’s Belt and Road Initiative (BRI) influences
new energy order; broad macro-level analysis,
5 Role of the One Belt and Road Initiative in Wu Hao et al. 2020 global energy geopolitics through infrastructure and energy
but lacks focus on project-level risk
Revolutionizing the Geopolitics of Energy cooperation
management frameworks

Analysis of the Risk of Project Delay Using Combined HOR-1 and HOR-2 to mitigate delays in bridge Identified dominant delay risks but did not
6 Qudsy et al. 2021
the House of Risk Method construction projects explore mitigation effectiveness deeply.

Implementation of the House of Risk Method

on the Identification of Factors causing Delay Applied HOR-1 to identify top 10 delay factors in a research Successfully pinpointed key delay agents; lacks
7 Shofiyah & Pambudi 2024
in the Construction Project of the UPNV East building project at UPNV Jawa Timur evaluation of mitigation follow-up.
Java Research Centre Building

Risk Cause Analysis and Risk Mitigation

Used HOR in procurement division to explore detailed relationships
8 using House of Risk Method in the Rizki & Santoso 2022 Strengthened risk-cause understanding
between causes and impacts compared to conventional methods.
Procurement Division of PT XYZ

Risk Analysis of Factors Causing Delays in

Implemented HOR in a university building project to design data- Provided clear priority actions but limited in
9 Work on Projects Using the House of Risk Andhika & Ayu 2023
driven prioritized mitigation strategies. scope to one institution.
(HOR) Method
 METHOD
S Risk Identification and
Risk Mitigation
• Selecting High-Priority Risk Agents
Assessment
• Identifying Mitigation Action
• Business Process Identification
• Calculating Effectiveness-to-Difficulty
• Risk Event and Risk Agent
(ETD) Ratios Concl
START Identification
• Prioritizing Actions Based on ETD usion
END
• Severity and Occurrence
Values
Rating
• Designing Mitigation
• Determining Aggregate Risk
Recommendations/Alternative
Potential (ARP)
Solutions.

House of Risk 1 House of Risk 2

Method:
Method:
1. Study Literature
1. Study Literature
2. Questionnaire
2. Questionnaire
3. Discussion
3. Discussion
4. Pareto Charts
 Comparison of HOR, FMEA, AHP, and
Monte Carlo Simulation for Project
Delay Risk Analysis
Method Purpose

Identifies, prioritises, and mitigates risk

Strengths

• Focuses on preventive actions

Limitations

• Relies on expert judgment

Suitability for Hydropower Delay Risk

Highly suitable because hydropower delays

• Captures complex many-to-many • Does not model probabilistic often arise from multiple interconnected causes
House of Risk agents by integrating severity,
relationships between events and causes uncertainty (land, approval, design). HOR effectively
(HOR) occurrence, and relational impact
• Quantifies priority using ARP and ETD • Requires structured risk prioritises risk agents and mitigation strategies
between events and causes.
• Effective for early-phase decision-making identification in a systematic, quantifiable manner.

Failure Mode • RPN ignores relationships between Moderately suitable for equipment-related or
Evaluates risk items based on severity, • Simple and widely used
and Effect causes and events technical component failures, but less effective
occurrence, and detectability to calculate • Useful for technical failure analysis
Analysis • Focuses on detection rather than for complex organisational and regulatory delay
Risk Priority Number (RPN). • Easy to implement
(FMEA) prevention factors prevalent in hydropower projects.

• Cannot handle large numbers of

• Very strong for ranking criteria Less suitable because hydropower delays
Analytic Multi-criteria decision-making tool that risks easily
• Transparent and logical structure involve many risk agents and interactions. AHP
Hierarchy ranks risks based on pairwise
• Suitable when criteria weights must be is not designed to model relational influence
Process (AHP) comparison. • Does not quantify interactions
derived systematically across numerous delay factors.
among risks
• Strong for probabilistic and time–cost impact Useful only for late-phase schedule risk
• Requires high-quality numerical
Models uncertainty and probabilistic forecasting analysis, not for early identification of delay
Monte Carlo data
outcomes by generating distributions of • Provides quantitative delay probability causes. Hydropower projects often lack detailed
Simulation • Does not identify root causes or
project delays or cost impacts. distributions input data during planning, making Monte Carlo
mitigation strategies
less applicable for root-cause analysis.
Data Collection Methods
The survey population consists of all stakeholders within the Indonesian National
Electricity Companies (PLN) involved in risk analysis and the construction of hydropower
plants, This includes employees

No Division Population Sample

1 Construction and Generation Audit Division 62

2 Construction Management Division 44

Operational and Project Risk Management

3 31
Division (Project Risk Department)

4 Project Management Office Division 35

Total 172 63

The total sample size was calculated using Slovin’s formula with 172 Population,
and 10% margin error, resulting 63 sample.

Respondent selection
• Employees having five years of experience
• Have a recognised risk management certification, QRMP, QRMA, or an internal ERM
qualification offered by PLN

• Before collecting data using a questionnaire, a questionnaire instrument test (pilot

test) is required. Data instruments are declared qualified and accountable if they
have proven their validity and reliability.
 Risk Identification and Assessment
(HOR 1)
Business Process Identification
Pre-
Implementati
Initiation Planning Implementati
on Closing
on

Identification of business process stages of hydropower construction projects is

done by literature study method based on Business Process Guidelines for
Investment Project Management of Electricity System Development (PT. PLN,
2013)
Risk Event and Risk Agent
Identification
Identification of risk events & risk agent, at this stage data collection is carried out as a
reference for identifying risk events and risk causes (risk agents) by studying literature
from several sources, among others:
• Risk Register: Construction Risk Management Division, Generation & New And
Renewable Energy (NRE) (PT PLN, 2023)
• Delay Identification of the HVAC Project (Gunawan dkk, 2020)
• Delay Factor Model For Malaysia Hydro Power Dam (Mohd Zakwan, 2021)
• Application of House Of Risk (Hor) Models for Risk Mitigation Of Procurement In The
Balikpapan Samarinda Toll Road Project (DA Wibowo, 2023)
No Project Stage Activities Risk Events ID Risk

Preparation of Project
Feasibility Study (KKP)
Delay in the Operational Feasibility Study
(KKO) and Financial Feasibility Study (KKF)
Documents
E1 Initial Risk Event & Risk
1 Initiation
Planning of Commercial Target Commercial Date in RUPTL not
Date/ General Plan for aligned with project phase implementation E2 No
Agent Identification
Risk Agent Code
Electricity Supply duration

Delay in Preparation of the Feasibility Study

1 Feasibility Study (KKF) Documents
Inaccurate system planning
Results
Lack of personnel preparing Operational Feasibility Study (KKO) and Financial
A1

Feasibility Analysis of E3 2 A2
Document
Continuation & Design 3 Duration for each project phase not yet optimal A3
Poor Quality FS Document E4
4 The appointed consultant team is not competent A4
2 Planning Preparation of Technical Changes in design specifications
Delay in Engineering Work E5 5 A5
Specifications
6 Price references in tender documents not updated A6
Preparation of Tender 7 Delay in fulfilling funding requirements A7
Inaccurate Tender Document Preparation E6
Documents (Bid doc) 8 Overly stringent funding requirements A8
Lack of communication and coordination among related
Funding Delays in Funding Determination E7 9 A9
departments/parties/staleholders
Procurement Delays in Procurement Process E8 10 No qualified providers A10
Pre- 11 Errors in survey data processing A11
3 Survey Execution Inaccurate Survey Results E9
Implementation 12 Complicated licensing procedures and convoluted bureaucracy A12
Based on the
Permitting Delay in Location Determination Permit E10 13 Delay in the establishment of the land acquisition team. A13
results of the
14 Landowners refusing to release land A14
Land Acquisition Delay in Land Acquisition Completion E11 literature
15 Late drawing review A15
Design Approval Delay in Drawing Approval E12 Lack of supervision during construction
review, a total
16 A16
17 Contractor’s workforce does not meet contract requirements A17
of 21 risk
Poor Contractor Performance E13 events and 29
Evaluating contractor 18 Supplier can't meet required specifications A18
Construction Delay E14 risk agents
performance 19 Equipment spec/vendor changes A19
4 Implementation Delay in On-Site Material Arrival E15 were
20 Installed materials not matching contract A20
Changes in Scope and Implementation 21 Incomplete material delivery documentation A21 identified
E16
Contract supervision
Schedule 22 System condition changes A22 across the
Delay in Contract Amendment Process E17 23 Delay in technical review documentation A23 five main
Delay in Commissioning and 24 Evaluation/negotiation process with contractors not yet completed A24 phases of a
E18 System not ready for Commissioning and Synchronization
Synchronization 25 A25 hydropower
Failure to issue a Certificate of Operational 26 Incomplete SLO requirements documents A26 construction
E19 There are pending work items
Eligibility (SLO) 27 A27 project.
5 Completion Construction Finalization Supporting documents for project handover are incomplete
Project Handover Delay E20 28 A28
29 Project performance does not meet performance guarantee A29
Subholding Reluctance to Accept Assets (if
E21
plant asset is handed over to subholding)
 Severity and Occurrence
Rating
Provide The Severity Value Of The Risk Event And The Probability Value (Occurance) Of
The Cause Of The Risk (Risk Agent).

The most common way to consolidate ratings from a group of

experts is to use the mean or average value for likelihood
and impact, ensuring all perspectives contribute to the final
risk score (Hillson & Simon, 2020). In addition, discussions
were held with the Project Risk Manager to determine the
final value of the severity of the risk event and the occurrence
of the risk agent.
RESULTS OF THE ASSESSMENT OF THE
RELATIONSHIP BETWEEN RISK EVENTS AND
RISK AGENTS
RESULTS ARP CALCULATION USING
THE HOUSE OF RISK 1
FRAMEWORK
 SELECTING HIGH-PRIORITY RISK
AGENTS
These agents have high ARP values because they
combine:

 High occurrence scores (frequent in PLN

projects), and

 Strong relationships with multiple high‑severity

The ARP findings suggest that the critical delay factors that
risk events
are inherent across
in the different project
PLN hydropower projectsstages.
are not strictly
technical in nature: they are systemic, with the organisational
coordination and planning quality, land/social issues, and the
performance capacity of the contractors leading to them.

Code Risk Agent ARP Score

Lack of communication and coordination among

A9 288
related departments/ stakeholders
A14 The appointed consultant team is not competent 172
A2 Inaccurate system planning 164
Contractor’s workforce does not meet contract
144
A17 requirements
A16 Lack of supervision during construction 144
IDENTIFYING MITIGATION ACTION
No Proposed Risk Management Actions Code References

Schedule regular cross-functional coordination meetings to review Risk Register of Hydropower project: PT PLN, 2023; Abbas, Gustiawan, et
1 PA1
project progress and resolve issues promptly. al., 2024; discussion with project risk manager

Establish a centralized project management information system for Risk Register of Hydropower project: PT PLN, 2023; Klarner, et al., 2013;
2 PA2
transparent data sharing and updates accessible to all stakeholders. discussion with project risk manager

Nominate a dedicated coordination officer/team to ensure information Risk Register of Hydropower project: PT PLN, 2023; Klarner, et al., 2013;
3 PA3
flows smoothly and responsibilities are clear. discussion with project risk manager

Provide training on effective interdepartmental communication and Risk Register of Hydropower project: PT PLN, 2023; Mohd Zakwan, 2021;
4 PA4
conflict resolution for key project personnel. discussion with project risk manager

Conduct a thorough pre-qualification and competency assessment for Risk Register of Hydropower project: PT PLN, 2023; Tang W,et al, 2023;
5 PA5
any consulting team before appointment. discussion with project risk manager

Assign experienced mentors or supervisors to oversee and guide Risk Register of Hydropower project: PT PLN, 2023; Braeckman, et al,
6 PA6
consultant teams, especially during critical phases. 2020; discussion with project risk manager

Use simulation tools or scenario analysis to validate system planning Risk Register of Hydropower project: PT PLN, 2023; Braeckman, et al,
7 PA7
assumptions and adjust as needed. 2020; discussion with project risk manager

Periodically audit planning methodologies and update system planning Risk Register of Hydropower project: PT PLN, 2023; Abbas, Gustiawan, et
8 PA8
standards to reflect evolving best practices. al., 2024; discussion with project risk manager

Impose contractual penalties for use of unqualified personnel and Risk Register of Hydropower project: PT PLN, 2023; Abbas, Gustiawan, et
9 PA9
monitor workforce compliance actively. al., 2024; discussion with project risk manager

Create a detailed field audit monitoring schedule and checklist on a Risk Register of Hydropower project: PT PLN, 2023; Oksuz & Brlek, 2023;
10 PA10
regular basis. discussion with project risk manager
Calculating Effectiveness-to-Difficulty (ETD) Ratios

Results of of the assessment of the level of difficulty

Results of the assessment of the level of effectiveness of the

relationship between risk management actions and risk causes
 No Code Proposed Risk Management Actions ETD Priority

HOUSE OF RISK 2 FRAMEWORK 1 PA1

Schedule regular cross-functional coordination meetings
to review project progress and resolve issues promptly.
853,3 1

Establish a centralized project management information

2 PA2 system for transparent data sharing and updates 672,0 2
accessible to all stakeholders.
Provide training on effective interdepartmental
3 PA4 communication and conflict resolution for key project 480,0 3
personnel.
Impose contractual penalties for use of unqualified
4 PA9 421,3 4
personnel and monitor workforce compliance actively.
Nominate a dedicated coordination officer/team to
5 PA3 ensure information flows smoothly and responsibilities 384,0 5
are clear.
Conduct a thorough pre-qualification and competency
6 PA5 assessment for any consulting team before 344,0 6
appointment.
Periodically audit planning methodologies and update
7 PA8 system planning standards to reflect evolving best 328,0 7
practices.
Use simulation tools or scenario analysis to validate
8 PA7 164,0 8
system planning assumptions and adjust as needed.
The key factor contributing to high ETD scores of PA1, PA2, Assign experienced mentors or supervisors to oversee
and PA4 is that they are associated to several risk agents of 9 PA6 and guide consultant teams, especially during critical 129,0 9
higher ARP. phases.
Create a detailed field audit monitoring schedule and
10 PA10 96,0 10
checklist on a regular basis.
 Designing Mitigation Recommendations/Alternative
Solutions
Based on the results of calculating the effectiveness value of risk management actions using the House
of Risk 2 framework, three proposed recommendations were selected as mitigation priorities/alternative
solutions, including:
• Schedule regular cross-functional coordination meetings to review project progress and resolve
issues promptly (PA1).
• Establish a centralized project management information system for transparent data sharing and
updates accessible to all stakeholders (PA2).
• Provide training on effective interdepartmental communication and conflict resolution for key project
personnel (PA4).
 Hydropower Project Management Practical
•Implications in PLN
PLN can begin focusing not on individual delay events, but on root causes
• Supports the rationale to institutionalise cross-divisional coordination
mechanisms
• PLN can enhance the front-end planning and information flows internally
• Findings also reveal the necessity to professionalise the workforce control
and supervision in the contractors
 CONCLUSIONS
• Objective 1 was achieved by first breaking down the hydropower project into five stages (initiation,
planning, pre‑implementation, implementation, and completion) and mapping the associated
business processes. In total, 21 risk events and 29 risk agents were identified and organised within
the HOR‑1 framework.
• Objective 2 was achieved through the quantitative application of HOR‑1 and HOR‑2. In HOR‑1, the
Aggregate Risk Potential (ARP) was calculated for each of the 29 risk agents by combining severity,
occurrence, and the strength of relationships with risk events, resulted in the identification of five
critical risk agents with the highest ARP values.
• Objective 3 was achieved by designing 10 mitigation actions linked to the five high‑priority risk
agents and subsequently prioritising them based on the HOR‑2 results and expert input. The ETD
analysis identified three priority actions as the most effective and feasible strategies
 Recommendation for Future
Works
Based on the findings and discussion in Chapter 4, several practical recommendations can
be proposed for PLN and for future research:

• Strengthen cross‑functional coordination as a formal process

• Develop and implement an integrated project information system
• Invest in communication and supervision capability of project teams
• Integrate land acquisition risks early in project planning
• Review and refine planning processes for hydropower projects
• Future studies could include external stakeholders (contractors, consultants, local
authorities, regulators) to broaden perspectives, and combine HOR with quantitative
time or cost‑impact analysis to estimate potential delay reduction or financial benefits
from implementing the recommended actions.
THANK
YOU

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Name
Birth
: Rendhi Maulana
: Jombang, 22nd August 1993
PROFIL
Study Program : Master in Engineering Management (MEM)
Institution : PT PLN (Persero)

• Academic Experience:
o Bachelor of Engineering – Electrical Engineering (2015)
Sepuluh Nopember Institute of Technology
o Master of Project Management (2022)
Sepuluh Nopember Institute of Technology

• Certifications:
o QIA (Qualified Internal Auditor) – 2023
o QRMO (Qualified Risk Management Officer) – 2024

• Job Experience:
PT PLN – Internal Auditor (2017-2024)

• Contact Information
+62 81297652405
[Link]@[Link]