Is the Procurement Crisis Undermining Renewables Investment?

Global investments in renewable energy infrastructure reached nearly half a trillion dollars. This capital injection, comparable to the entire GDP of nations such as Denmark or Singapore, signals the sector's growing prominence in the global economy.

New research from infrastructure procurement platform Ansarada reveals that renewable energy investments surged 49% year-on-year, totalling US$496.7bn worldwide. The figures could suggest a sector experiencing rapid acceleration, yet beneath these impressive headlines lie operational challenges that could threaten the pace of delivery.

Ansarada's analysis of the data reveals additional insights. Europe is currently commanding the largest share of investment, with US$202.7bn flowing across 1,035 transactions. This represents an 82% increase in value compared to the prior year. Offshore wind emerged as the standout energy source, with investment values surging 290% to reach US$89.8bn. The financial close of the 1.4 GW East Anglia Three project off the UK's East Coast exemplified this trend, securing a £3.6bn (US$4.8bn) debt package supported by 24 international lenders.

Capital concentration in fewer projects

Despite the substantial growth in investment value, Ansarada's study uncovers a concerning disparity. The actual volume of transactions rose just 7% globally, with Europe seeing only a 4% increase. This gap could indicate that capital is consolidating into fewer, larger and increasingly complex projects that require rigorous procurement processes to progress.

To explore this further, Ansarada interviewed 150 executives about their experiences with procurement in the energy sector. The findings reveal potential inefficiencies across regions. Only 37% of respondents across EMEA and the Americas described their most recent renewables procurement process as "very efficient". In Asia-Pacific, this figure dropped to merely 24%.

Justin Smith, MD at Ansarada, addresses the implications directly. "Europe has established itself as the global benchmark for renewable energy infrastructure, with regulatory frameworks and supply chains that attract institutional capital at scale," he says. "But there's a critical disconnect between the ambition reflected in investment figures and the procurement processes actually delivering projects. Capital is abundant, but execution capability is the binding constraint."

The challenges extend beyond efficiency concerns. Ansarada's report finds that approximately 90% of EMEA respondents described transparency and auditability as "very important" or "essential" to their procurement processes. However, nearly a third admitted those same processes lacked clarity for internal stakeholders. This disconnect poses particular challenges as sustainability mandates and ESG regulations become increasingly stringent across the EU.

Transparency challenges in procurement

"The transparency gap isn't just an operational inefficiency; it's a commercial risk," Justin explains. "Institutional investors and project financiers increasingly demand auditable evidence that ESG criteria are genuinely embedded in procurement. Organisations that can't demonstrate that risk losing access to the capital that large-scale renewable projects need."

Part of the answer to why procurement processes could be falling short lies in what Ansarada terms "fragmentation". While 91% of respondents claimed to use purpose-built procurement software, EMEA organisations were found to be operating an average of 3.8 disconnected systems simultaneously. More concerning still, 55% of respondents say they continue to rely on email for managing correspondence related to sensitive bidding.

Andy Potter, Business Development Director in EMEA at Ansarada, believes significant improvements are possible. "If you're still using fragmented systems or traditional cloud storage, you lose that 'golden thread' of accountability that modern regulators and investors now demand," he says.

Justin describes the result as a "Frankenstack" – a collection of incompatible tools that creates the appearance of digitalisation without delivering its benefits. This patchwork approach could be undermining the sector's ability to meet ambitious renewable energy targets as demand continues to climb.

System fragmentation hampering progress

Analysis from Bain & Company cited in the report suggests global compute requirements alone could reach 200 GW by 2030, driven by AI infrastructure, making reliable green energy an industrial necessity.

Ongoing geopolitical tensions in the Middle East and their impact on global hydrocarbons markets emphasise this urgency further. Christophe Williams, CEO of Naked Energy, speaking about regional conflicts' impact on the UK's energy landscape, says: "Tackling heat with British and European made clean technologies is one of the fastest ways to lower exposure to gas prices while strengthening energy security."

Yet ambition and delivery remain distinct challenges. As Justin frames it: "The question for Europe is whether procurement processes can match the scale of ambition reflected in investment figures. Capital is flowing toward large-scale and integrated projects, but delivery depends on treating procurement as critical project infrastructure from day one, not an administrative afterthought."

The sector now faces a critical juncture where the availability of capital must be matched by the capability to deploy it effectively through streamlined procurement systems.