What should I be aware of while signing contracts with EPCs?

It is very important that the developer goes through the solar EPC contract in detail, even if takes a toll on your time. The following pointers should be taken note of before signing a contract with the EPC.

  • Validate all details of the components they supply
    • Ensure that poor grade panels with visible cracks and bends are not provided
    • Ensure that the brand of the panels is same as what is initially specified
    • Ensure local service support is available for inverters
    • Go for good quality inverters that are known to perform well in your region
  • Review generation projections and ask EPCs for the methods for arriving at the same
    • Ensure that they have not computed savings based on exaggerated generation estimates
    • Ask for real life case studies of generation in your area
  • Check and understand the minimum warranty period of components
    • Read the warranty terms in detail at least for key components
    • Review component manufacturers’ reputation and client list
    • Avoid panels without performance warranty up to 25 years and inverters up to 5 years
    • Assess benefits of extended warranties, especially for inverters
    • Check with EPC on aspects which will not be covered by warranties and discuss mitigation methods
  • Proper coverage of performance guarantees
    • Ensure the EPC does not just promise high generation, but also covers it in the contract
    • Negotiate for a minimum of 80% as Performance Guarantee
    • Penalty Clauses for failures to meet guarantees should be mentioned in EPC contract
    • Also make sure your EPC commits to timelines on paper and includes penalties for non-compliance

You might want to check out these questions too on EPCs – Contract Terms and Value Adds

  • What kind of guarantees is provided by a good EPC? – Here
  • Can you avail a free quote from an EPC before you decide on them? – Here
  • How important is the solar EPCs’ transparency in transactions? – Here
  • How will the level of sub-contracting done by a solar EPC affect the power plant installation? – Here
  • What difference can a solar EPC’s skill in engineering design bring to the power plant? – Here
  • What kind of team profile should you look for in a solar EPC? – Here
  • What are the usual timelines provided by good EPCs for project completion? – Here
  • How much do EPCs charge for their services? – Here
  • What value addition can solar EPCs with good industry partnerships provide? – Here
  • What are the certifications you need to look for in an EPC? – Here
  • What are the critical value-adds to expect from high-quality solar EPCs? – Here

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  1. Pingback: How much do EPCs charge for their services? - Solar Mango – #1 guide for solar

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