EPC Challenges in India and Possible Way Forward

Government support and encouragement has helped Indian solar industry to reach ~16.6 GW solar capacity. Government of India should be commended for bringing in (and incentivizing) solar venture for private players, which has played a major role in green energy capacity ascension. It is a fact that solar in India has scaled a great height and future looks rosy with new projects, plans and policies coming. However, it is also important to highlight the challenges that required to be addressed. And EPC operations is one of the challenges in question.

Engineering complexity involving EPC operations is less complex than that of conventional energy plants. However, EPC solution providers in India have faced challenges in construction and delays in reaching completion time line due to bureaucratic hurdles. EPC operations within India require interaction and dealings with internal teams, sub-contractors, local bodies, clients, vendors etc. in such a scenario bureaucratic delays cause issues in managing operation profitability.

Generally, the issues that hinder EPC processes are- land acquisition, logistics, and engineering. Inspecting each of these issues individually can help in getting a better idea of situation.

Vikram Solar 130 MW plant in Rajasthan

Land Acquiring Related Issues

More than 5 acres of land is needed to install 1 MW of solar plant. Therefore, it is easy to understand that solar growth has a land requirement. In addition, the there are multiple parameters like- soil geology, compatible topography etc that needs to be checked before selecting a land for solar installation.

Challenges of finding the right land are not the only hurdles, getting a cost agreement for the land is also an issue since in India land holdings are generally divided into several family members. Thus, discussion with all the stakeholders and getting an agreement takes time, ultimately delaying project timeline.

Plus, regulatory bottlenecks like- lands identified as farmlands cannot be taken for solar installation. It is a fact that Government has done exceptional work in building solar parks, which offers already purchased and prepared land ideal for solar installations. States like- Karnataka, Andhra Pradesh, Uttar Pradesh, Rajasthan have already developed policies that simplify land acquisition. Such processes should be followed in every state within India to support solar growth.

Logistics Related Challenges

Generally, lands selected for large solar installations are far from residential areas (ground mounted). And since transportation in remote areas of India is still not well developed, bringing in all required components for solar installation at desired spot seems a challenging, time consuming, and expensive task. Even if EPC contractors take on the added responsibility and risk of getting their plant related equipment in a remote location, adequate standard (safe) road availability puts risk of damage to their precious solar plant equipment. If EPC contractors to opt for insurance for their products, added cost affects upon the financial and construction plans.

India needs to focus on better road development and skill improvement for handling solar EPC materials. Increase in awareness can help the EPC contractors get skilled transporters and on standard roads.

Engineering Challenges

Innovative engineering systems and processes can help in rapid installation of the project. However, for innovative engineering system to be established, EPC players need detailed geotechnical reports, solar resource availability, and ambient conditions. However, as Indian Government doesn’t have such important information in store, actions like- maintaining stability of the installations, levelling the field, protecting against wind load, minimizing repairing cost, becomes extremely challenging.

Way Forward

Solar is gaining worldwide acceptance and is believed to be able in phasing out fossil fuel in near future. This is a great opportunity for India to utilize this timeframe through initiatives and investments for growth in solar. Better utility side cooperation, adding feasibility in interconnection processes, and supporting solar growth by enforcing policy implementations can help EPC players, thus aiding solar progress.