Sypro

Simon Hunt

With investment in net zero infrastructure accelerating, bringing with it a surge in solar farms, offshore wind, hydrogen initiatives, carbon capture projects and battery energy storage systems, the Europe and UK energy sector is entering a new phase of complexity.

As the energy mix diversifies, the way projects are delivered is changing just as quickly. They are no longer standalone developments; they are deeply interconnected, often spanning geographies, regulatory frameworks and supply chains. Yet one area continues to lag behind: contract governance.

At a time when energy infrastructure is becoming more sophisticated, the systems used to manage contracts often remain fragmented. Spreadsheets and email chains still underpin decision making on projects worth hundreds of millions, and that disconnect is beginning to show.

Rising investment in energy infrastructure is not simply increasing the number of projects. It’s reshaping how those projects are delivered. Offshore wind developments, for example, rely on international supply chains, specialist contractors and complex logistics and hydrogen and carbon capture projects often sit within emerging regulatory frameworks that are still evolving.

In the UK, this complexity is further shaped by the distinction between regulated and non-regulated businesses. Transmission and distribution sit under regulatory oversight, while generation, renewables and newer technologies often operate in hybrid or unregulated environments. Across Europe, this picture becomes even more varied, with different procurement models, legal systems and contract standards in play.

The result is a more fragmented operating environment, where multiple contract forms coexist. NEC contracts dominate in the UK, particularly for regulated infrastructure. FIDIC is more common across Europe and in international projects, especially where global contractors and manufacturers are involved. Alongside these sit bespoke agreements and sector-specific forms such as IChemE.

Regulatory scrutiny is also intensifying. In the UK, Ofgem has expanded its focus beyond internal efficiency to include supply chain performance, timely payments and demonstrable compliance. These metrics are not abstract, they directly influence funding, framework eligibility and long-term investment.

This shift is important as it signals a move away from process-driven oversight towards outcome-based accountability. However, many organisations are still relying on tools that were never designed for this level of scrutiny.

Spreadsheets can store data, but they can’t provide a reliable audit trail. Email chains can document conversations, but they don’t offer structured visibility. In an environment where decisions need to be traceable and defensible, these limitations create risk.

At the same time, increasing scrutiny of public spending is placing further pressure on energy companies to demonstrate transparency, value and accountability across every stage of project delivery. Scope changes, programme delays and unforeseen site conditions are common across large infrastructure projects. Without clear visibility, these issues can escalate quickly, affecting cost, timelines and ultimately delivery.

“Spreadsheets can store data, but they can’t provide a reliable audit trail. Email chains can document conversations, but they don’t offer structured visibility.”

This becomes even more pronounced in international projects. Organisations operating across Europe often find themselves managing FIDIC contracts through a patchwork of spreadsheets and emails, while their UK counterparts adopt more structured approaches under NEC frameworks. The inconsistency creates gaps in governance, particularly when projects span multiple regions.

The wider energy sector has already embraced digital transformation. Building information modelling (BIM) and digital twins are now widely used to improve design, coordination and asset performance. These tools provide real-time insights and a shared view of project data.

But contract management has not kept pace, and there is a clear opportunity to bring contract governance into the same digital ecosystem. Doing so would enable real-time oversight of obligations, risks and performance, creating a single source of truth across stakeholders.

When contract data is integrated with project data, organisations can make better decisions, earlier as risks can be identified before they materialise, and supply chain performance can be tracked against contractual commitments.

In a sector where delays and disputes carry significant financial and reputational impact, that level of visibility is critical. As demand increases, particularly with new housing and electrification, the resilience of energy networks becomes more visible to consumers. Capacity constraints, delays in connection and pressure on local networks risk translating into real-world disruption, from slower housing delivery to concerns around reliability.

Some organisations are beginning to address this challenge. SSEN Transmission, for instance, has moved towards more structured, digital approaches to contract management as part of its broader response to regulatory demands and project complexity.

This reflects a wider shift across the sector. As governance requirements increase, organisations are recognising that contract management can’t remain an afterthought - it needs to be embedded within the delivery model.

Ultimately, energy infrastructure projects have high stakes by nature. They involve significant capital, long timelines and critical national importance. Contract governance sits at the heart of this, shaping how risks are allocated, managed and resolved.

Moving away from fragmented, manual processes towards more structured, digital approaches is not simply a technical upgrade; it’s a necessary step in building confidence across the supply chain. For stakeholders, it provides assurance that obligations are being met and risks are being controlled. For regulators, it offers the transparency needed to support continued investment. For project teams, it creates clarity in an increasingly complex environment.

As the energy transition accelerates, the question is no longer whether contract management needs to evolve. It’s how quickly organisations can adapt to meet the demands of a more connected, more scrutinised and more complex industry.