Evolving Landscape And New Strategic Directions For EPCs In North America

While value is of significance for all solar projects, it is of utmost importance in North America. According to Bates Marshall, vice president and general manager of Huawei FusionSolar Smart PV solution for North America, “the engineering, procurement and construction (EPC) firms in North America are highly focused on capex whereas most everyone else in the deal has a long-run perspective”. The Investment Tax Credit complicates the whole deal process in utility-scale solar projects in the U.S. Notably, besides being construction companies, EPCs are required to serve as guarantors for the success of the power plant. Another distinguishing side of U.S. EPCs is that they’re out in just one year or two. So, risk and time are the main reasons for U.S. EPCs’ focus on capex. Thus EPCs mostly choose the less expensive central inverters rather than the string inverters like elsewhere in the world.

According to GTM Research, in 2016 “almost half of utility-scale projects in China used string inverters, compared to less than 5% in the U.S.”. Declining prices of inverters and high-powered 1,500-volt products available in the market are about to change these numbers and reshape the current business models with a more long-term strategic approach.

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