A €50 Million Pipeline Can Be Worth Almost Nothing.

Few numbers in energy companies create more false confidence than pipeline value.

Add enough early opportunities together and almost every commercial organisation can produce an impressive number. €100 million. €500 million. Sometimes several billion.

The number itself tells management surprisingly little.

During my time building commercial structures around energy projects, including a pipeline of more than 40 sites representing around €50 million at Infener, the more important question was never simply how large the pipeline had become.

How much of it can genuinely move?

Pipeline needs a definition

A person interested in a solution is not a project. A meeting is not an opportunity. A technical concept is not a commercial opportunity. And an opportunity is not necessarily executable.

I therefore find it useful to distinguish several levels.

Interest

There is curiosity, but no defined commercial process.

Opportunity

A real customer problem exists and our proposition may address it.

Qualified project

Site, application, stakeholders, economics and decision process are sufficiently understood.

Commercial project

There is budget logic, internal sponsorship and a realistic decision path.

Executable project

Financing, contracting, technical feasibility, permitting and implementation can credibly converge.

Putting all five into one pipeline number hides far more than it reveals.

Progression matters more than volume

A strong commercial organisation should therefore track movement.

• —What happened to this project in the past thirty days?
• —Which uncertainty was removed?
• —Which decision-maker became involved?
• —Which contractual issue was resolved?
• —Which technical constraint became clearer?
• —What must happen next?

If an opportunity remains in the same stage for six months without a clearly identifiable reason, it may not be pipeline. It may be hope.

Energy sales requires probability discipline

Energy infrastructure is particularly susceptible to inflated pipelines because projects are large. A handful of potential sites can create very impressive headline numbers.

But high individual project values also mean that forecast errors become dangerous quickly. Management decisions on hiring, working capital and investment can then be built on revenue that was never genuinely likely to materialise.

Commercial discipline means being willing to reduce the pipeline number. That may feel uncomfortable. But a €50 million pipeline that management understands is more useful than a €500 million pipeline nobody can explain.

Ask one uncomfortable question

For every material opportunity: what precisely must become true before the customer can say yes?

If the account team cannot answer that question, the organisation probably does not understand the project well enough.

Pipeline quality is not ultimately a CRM problem. It is a management discipline.