Could new EPCs enter renewables?
New types of EPCs could also enter renewables. A few large, diversified EPCs that serve other industries have begun expanding into solar. And as owners look for available talent pools to get projects in the ground, local or regional contractors could also be reskilled to install solar projects.
Will EPC capacity be tripled in ?
Based on McKinsey analysis, EPC capacity to serve utility-scale solar projects would have to almost triple to meet the anticipated demand of approximately 50 GW installed in . These market dynamics produce strong incentives to rethink traditional industry practices and unlock more-efficient project delivery.
What is the difference between an EPC and a utility?
The utility could procure equipment in-house—such as panels, inverters, trackers, and racking—to manage long lead times and leverage economies of scale across multiple projects while the EPC focuses on building the labor and technical skills to install solar.
Should you choose an EPC contract for a solar project?
Given the significant monetary value of EPC Contracts, and the potential adverse consequences if problems occur during construction, the lowest price should not be the only factor used when selecting a Contractor. As noted earlier, an EPC Contract is one of a suite of agreements necessary to develop a solar project.
Will EPC contracts provide for the handover of a solar facility?
EPC Contracts will not provide for the handover of the solar facility to the Project Company, and the PPA will not become effective until all commissioning and reliability trialling has been successfully completed.
How do solar EPCs compete with higher-margin industries?
To expand capacity, solar EPCs must compete with higher-margin industries for engineering and construction talent. What’s more, solar projects are often installed in rural areas where the overall labor pool is smaller to begin with, putting even more pressure on solar EPCs to ramp up their workforce development. Limited access to land and permits.
EPC contracts in the solar sector
The Project Company needs only to turn a key to start operating the facility, hence EPC Contracts are sometimes called ‘turnkey’ construction contracts. The Contractor must deliver the
EPC
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