Overcoming PV Deployment Challenges - EPC

The #EPC services are a significant support for #Developers and #IPPs, and the industry alike. However, the EPC traditional role has changed its position in the market. In the past years, there was a clear separation. There was the Developer who owned the project, and there was an EPC company that was taking the risk to manage and build the project for the Developer. Usually, the EPC hires many subcontractors to deliver specific parts of a project.

In recent years, EPC companies have been more flexible in scope and proactive in project management since the scope looks more limited. This is because most of the Developers have grown in size and have organically invested in engineering and procurement capabilities, meaning that they prefer to save some money, have control of all quality and T&C with the main suppliers, and even do some preliminary engineering work.

1. Permitting and regulatory Hurdles

Obtaining the necessary permits and complying with local regulations can be time-consuming and complex, potentially delaying project timelines.

2. Financing and Investment

Securing financing for solar projects, including finding investors and negotiating favorable terms, can be a complex process, especially for #largescale projects with high capital requirements. On the other hand, many of the equipment costs have decreased during the last years significantly, above all the PV module prices. This compensates for the increase in borrowing costs.

3. Oversupply projects

The number of projects to EPC increased last year because of the growth of installation capacity. This was a good opportunity for EPC companies to redo their strategy.

4. Installation time

For a long time, the installation time has been always one of the EPCs’ challenges. EPC must be quick and provide better quality. “Quicker” means building between 5 to 10MW per week for the Utility sector.

??Early-on be involved in a project, planning time and delivery time can be met. Adoption of modular construction techniques and prefabrication to enhance project scalability and speed of delivery.

5. Payment improvements

The enhancement of payment conditions with suppliers expands the financial limit of EPC.

6. Traditional role

Nowadays, EPCs are more selective. Instead of every tender that comes to them, EPC companies started seeking clients they know to secure that payment on time, so the relationship and trust are significant because time is an enemy of EPC companies. Alike, developers companies started looking for strategic relationships with EPC companies that they could trust, provide the right quality, and meet deadlines. Here, the equation is that time and quality are more important than price.

?? Engaging in collaborative partnerships with project developers, financers, and other stakeholders allows them specialized expertise, shared resources, and innovative solutions, fostering competitive advantages and enhancing project execution.

7. Limited installation capacity

Lack of installation capacity and land acquisition drive EPC companies to be more selective and transform into repowering “secondary” market sustainable growth, as well as to expand into emerging market with high demand for projects development.

??EPC companies have the opportunity to expand their operation and enter new markets with emerging renewable energy potentials.

8. Skillset staff

The lack of labor resources and the young generation is just beginning to learn their competence. Additionally, #BESS installation and management expertise are still building up. The same happens with Hybrid PV plants with other technologies.

EPC companies are unable to refill qualified workers and contractors will surely see repercussions to the brand and their outcomes.

??Investing in workforce development and talent retention to ensure access to skilled professionals and foster innovation.

9. New Technology Adaption

EPC companies tend to adapt slowly to new technology. The fast technological advancement requires continuous investment in training and upgrading infrastructure.

??Embracing advanced technologies can help streamline processes, improve project performance, and drive cost reduction. Partnering with technology providers and startups to develop customized solutions and gain a competitive edge.

10. Emphasis on ESG

Growing importance of sustainability and social responsibility in project planning and execution. EPC companies are aligning their operations with #ESG standards, supporting the industry's focus on environmental and social responsibility. This includes but is not limited, to environmental impact, community engagement, workers' rights, and sustainable practice throughout the project life.