| Our company got the Datang Shangshan Power Plant 660MW Supercritical Units bid by 502.8 million RMB, which is half of our output in the year 2007. So the success of this project is of great importance to the development of our company because of the huge risks in this project. By focusing on the analysis of risk factors in the construction process, this paper tries to present some detail measures to the formation of prevention, control and reduction of in order to maximize profits.The Construction of Datang Changshan Power Plant 660MW Supercritical Units is of great importance to Jilin Electric Power Construction Company because it is the first 660MW units with an output of 500 million every year, which is half the output of our company. It is vital to whether our company can lead the market and build reputation. So there is great risk in this project. How to effectively predict, control and prevent the risks in the construction process in order to decrease economic lose is the main part of this paper.1. Sources of RiskConstruction of power plant projects have both objective and subjective aspects of risk factors. Objective factors such as: changes in the market faster, more unpredictable factors occur, do not have enough resources to develop, market competition, lack of management, decision-making levels and mechanisms in place. Subjective factors such as: various factors on the construction decision-makers thought blindly, Ji Gong rash on the market analysis is not in place, the various risk factors on the assessment of the project is not in place, leading to misjudgment, resulting in the risk of making decisions. The source of half of the following areas:(1) Credit RiskCredit risk is the risk caused by contractee's not fulfilling responsibilities after the contractor got the bid. The project is not approved due to start, so there is definitely credit risk. At the same time, the contractor needs to issue individual projects to other companies in the construction process. If other companies exaggerate their strength, the contractor may suffer from great loss due to potential credit risk.(2) Financial riskThe construction process of this project involves the contractee, the construction team of the contractor. There are lots of mobile parts in this project. In this project, the contractee needs to pay 80% of the construction cost, so payment in time is the important factor influencing construction progress. The construction company will suffer from great risks if the contractee does not have enough budgets or the project is not approved. If the party giving financial budget, the project is not approved, all construction units will pose a significant risk.(3) Construction RiskConstruction process is the dynamic process of production and it is likely that event link can have unpredictable risks, such as security risks. If not because of protection of personal injury caused by operating personnel risk, if the quality of construction accidents are caused by serious construction will leave a huge risk. Market risk in the construction period, due to technological change, the technology behind the project technical risks.(4) Other risksRisk with connectivity, internal, external, force majeure risks and other risks appear connected, such as force majeure risk occurs, the construction of increased risk, construction risk of the increased risk of capital and intensify the risks of overlapping is bound to risk a direct result of the contract, the final result contract cannot be implemented to enable enterprises to suffer huge losses.2. Project Risk AnalysisJilin Electricity Construction Company invested 500 million in the Datang Changshan project. It is the first 660MW Supercritical Unites in Jilin Province and huge risks lie within this project. By study and make judgment of the project contract and evaluate the problems with the party issuing the contract, the risks in the construction process can be summarized in the following aspect Datang Jilin Electric Power Construction Company Long Hill power plant investment in the prices of 500 million, and is the province's first station 660MW supercritical units, the risk of a huge contract research project to determine, on the party giving out their own problems and to assess the main construction phase the risks that the following aspects:(1) The risks of project contractProject contract is the combinations of efforts of legal professionals, senior business experts taking into consideration of the actual situation of the power plant. All the arguments in the contract are well thought. So the signing of the contract is vital to whether the construction company can acquire the initiative position. Liability, claim links, capital allocation and time requirements defined in the contract are all closely related to whether the project can move forward smoothly. If the duration of the delay is caused by contractee, how determined and how to claim for compensation will be the greatest risk.(2) Risks caused by paymentSuch a large-scale project for construction company is a survival test. With quality tested by strength and process tested by fund, mutual assistance between the two is out of doubt. The money payment method cannot been found both in the main part and appendix of the contract, but no matter which party will take the risk, the construction process will be delayed. The constructions business cannot start if the money is not in place. From the perspective of the fulfilling the contract, the contractor's decisions are heavily related the money. As this project is approved by the Development and Reform Committee, it will be very difficult for the company to make a loan from the bank, which will be the greatest risk of further fund.(3) Risks caused by responsibilitiesThe contractor proceeds with the construction according to the requirement of the contractee and the contractee needs to check quality and progress of the construction. There is an opposite relationship between the contractor and contractee in terms of responsibilities and rights. The contractee has the initiative in terms of payment and bid choice while at the same time the contractor has the initiative in terms of construction progress and quality. There has been an exchange of positions of both parties. 3. Control(1). Before signing the final contract, the contractor must have a hearing meeting with high-end experts and other related employees in the company, which will allow the employees in the company to fully understand the contract and the company will also have some advice and feedbacks from the experts and employees. The company has to carefully examine favorable and unfavorable factors of the contracts and make up to the contract loopholes.(2) In terms of fund application, the company must have a detail description of the project schedule. The responsibilities of party issuing the contract must be clear and the party issuing the contract must wire the money according to the contract in order to make sure that project payment be credited to the account in time every month.(3) The definition of responsibilities and rights must reflect fairness and the interaction between responsibilities and rights cannot be changed, but in the application process, the actions taken by the party issuing the contract be fair and both parties should have definite responsibilities and rights. The contractor must fight to the end if the party issuing the contract first violates the contract. Breach of the Treaty to terminate the contract if the contractee, the contractor must argue, and there is evidence to seek non-passive, affecting engineering and drainage pipe.4. ConclusionThe first round construction of Datang Changshan Power Plant 660MW Units is a major event in the construction business, as it is related to the survival and development of the company. In this paper, we analyze the possible construction risks in the construction process and give corresponding control measures. But in the actual implementation of the project there will be unpredictable risk of loss of control, which will require further study and in-depth analysis in order to take preventive measures. |
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