He also recommends that owners need to turn to an experienced management team, independent of the EPC, to oversee the construction phases. This will reduce the chances of the EPC not acting in the owners’ best interest”. Meridor suggest the following solution: “Owners need to sell a share in the project to the EPC. He adds: “The owner tends to contract the main equipment for the plant, while EPCs focus solely on the construction side”.īut where this is not the case, what steps can owners take to ensure EPCs are acting in their best interest? “In the majority of projects in which we have been involved, the developer and construction firm work together,” says Gonzalo Ruiz de Angulo, Head of Renewables at BBVA. Tarrago concurs, explaining that to date, the only type of project for which financing has been requested from her bank has involved developers also acting as EPCs. “EPCs also often act as developers, which means it is difficult for them to inflate their margins at the cost of the plant owner,” highlights Eduardo Serrano, General Manager of Sener’s Procurement, Construction and Start-up Division. “It is therefore preferable to have just one EPC”, she explains.Īs such, do developers face the possibility that EPC contractors are abusing their position across the board? This is unlikely the case. Rosa Tarrago, Senior Manager at KfW Ipex-Bank says that in the case of parabolic trough plants, components are very similar from one project to the next. This situation may be being exacerbated by the fact that banks prefer projects where owners only deal with one party and that this party be an EPC. One solar field component supplier, who prefers to remain anonymous, adds that EPC contractors are squeezing suppliers on price when negotiating directly with suppliers on behalf of plant owners and developers, but are boosting their own margins by not passing on these lower prices. “EPC companies are able to inflate prices in order to create a high ‘acceptable price’ in the market”, he explains.
“CSP project contract costs are currently being inflated by EPC contractors’ margins,” says Meridor. Udi Meridor, founder of CSP developer and consultancy firm Solamancha, is adamant that this is the case. Yet some industry players report that EPCs are not pulling their weight in the drive to reduce costs. If the CSP market is to have a future, costs of developing and generating CSP must fall, particularly in countries such as Spain, where plants are generally profitable because of government support in the form of a feed-in tariff.Ī significant expense of rolling out CSP capacity is the cost of the EPC firms contracted by plant owners to construct plants. Engineering, Procurement and Construction contractors (EPCs) called in to build plants are part of the equation, but do their efforts to drive down costs add up? We cannot bring our dear friend back, however we will never forget the imprint he left on our hearts.The CSP industry needs to streamline costs to boost its competitiveness. Additionally, as higher-education had always been a priority for his daughters to achieve, we hope to also grant a scholarship in Efren’s honor to a student at the University of Texas at San Antonio, where his daughters all attended. Part of our mission to keep Efren’s memory alive is to grant funds to the next generation of skilled trade workers through various organizations in the area. Efren’s passion for the craft, as well as his tremendous abilities to accomplish projects for the team are greatly missed. Skilled trades are a gap that has been recognized nationally.
To do so, we have created the Efren Martinez Charitable Fund in which we aim to raise funds through events which will directly be used to support his three daughters not only through their college years, but also into womanhood in the manner that Efren would have done. While Efren was taken from us unexpectedly, we are dedicated to keeping his memory alive for the industry that he loved, as well as his family who he supported.
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