April 13 (SeeNews) - In this month’s overview of the global utility-scale solar sector, Philip Wolfe reviews the recently published list of top EPC contractors, and assesses the climbers and fallers in the expert arena of plant design and construction.
First Solar (NASDAQ:FSLR) and Juwi remain at the top of the list of top EPC contractors published earlier this week, but there has been plenty of movement elsewhere in the ranks.
Geographical market focus
It is clear that there are two strategies for achieving prominence as an EPC contractor in utility-scale solar. You must either (a) focus on a defined primary market; or (b) operate across a broad range of markets to insulate against volatility in any individual country.
First Solar and Swinerton are good examples of the first strategy, concentrating most of their efforts in the US market which has been strong for several years and promises continuing growth. The downside of this approach is exemplified by Activ Solar, which has focused its activities in the Ukrainian market, so risks continuing to slip down the rankings due to the local challenges there.
Typical of strategy (b) are Juwi and SunEdison (NYSE:SUNE) both of which have established projects across 5 continents. The latter, in particular has a footprint, not only in its home market of the US, but in all the major growth markets outside China, including Chile, India, Japan, the UK, South Africa and the Philippines. This is clearly a more difficult strategy to execute; and risks companies over-stretching or ‘spreading themselves too thin’, which may have contributed to SunEdison’s recent woes.
Of course most companies start by gaining a foothold in a single geographic market, before going further afield. This is usually their home market, although two British companies in the top 30, Amec Foster Wheeler and RES Group, have built their position mainly through developments in North America, with a lesser presence in the UK or Europe.
Smaller companies may be more vulnerable to stagnation in their primary markets. Solarcentury, which has climbed into the top 25 for the first time thanks to its standing in the UK, has a limited track record in Central America; and will need to extend its non-European business, if it is not to slide back down the rankings. The same will apply to those other European companies, which have done well to stay in the top division, such as Enerparc, Belectric, Conergy, IB Vogt, Isolux Corsan, Martifer, Phoenix Solar (ETR:PS4), Saferay and X-Elio (formerly Gestamp), most of which are broadening their geographic coverage.
Diversification and business profile
The other main dynamic, beyond geographical diversity, is the business profile of the contractor.
Many in the list are fundamentally contracting companies. Some are specialists in the renewables sector, such as Juwi, Enerparc and SunEdison; many of which are also diversified into project development. Others focus purely on EPC and O&M from a construction focus, like Swinerton, Amec Foster Wheeler and Eiffage – which was catapulted onto the list by its work on the 300-MW Cestas project. Then there are a handful whose main business is engineering and project management, such as Bechtel, Fluor (NYSE:FLR) and Larsen & Toubro.
Other companies in the list are those which have vertically diversified into EPC from an upstream specialisation, usually in solar module manufacturing; such as table-topping First Solar, the cadmium-telluride solar cell producer. Canadian Solar (NASDAQ:CSIQ) and Q-Cells have also been involved in project development and EPC for some years, and Trina Solar (NYSE:TSL) and Yingli Green (NYSE:YGE) have more recently joined this list.
A few PV inverter producers have similarly diversified into plant construction; most notable TBEA and Toshiba (both also solar module producers) and Schneider (just outside the top 30).
Other recent utility-scale PV news
We end as usual with our regular monthly look at interesting and new developments in March:
Chile has at last joined the 1 GW club – having promised to do so for some months. The March report from the Energy Ministry CIFES shows 1,034 MW connected and a further 2 GW under construction.
Two more Central / South American countries have joined the utility-scale solar club; with the 30 MWAC Monte Plata project in the Dominican Republic – the largest to date in the Caribbean – and the 22 MWAC Alta Cielo plant in Uruguay.
A spate of new plants was commissioned in the Philippines ahead of its feed-in tariff deadline. This includes the country’s largest plant, 100 MWAC at Tinampa.
Ontario has launched a 140-MW solar procurement round as part of its new Large Renewable Procurement (LRP) programme
Source of data
All the details in these posts are based on the Wiki-Solar Database of some 5,500 utility-scale PV solar projects around the world. Unless otherwise stated, capacities are expressed in terms of the AC output of the plant, and ‘utility-scale’ is defined as projects of 4 MWAC and over.
About the author:
Philip Wolfe has been in renewables since the 1970’s when he was founder Chief Executive of BP Solar. He led companies in the PV sector until the early 2000’s. Since then he has undertaken more broadly-based roles in renewable and community energy. His book on utility-scale solar was published in 2012.