In today’s world, it seems more difficult than ever to find common ground on anything. But one subject most agree on is the deteriorating state of our infrastructure. From roads and bridges to water treatment and power delivery, there is a vast backlog of assets that need to be refurbished, upgraded or built from the ground up.
The capital investment needed is staggering — totaling in the trillions.
Within the electrical transmission and distribution industry, a great deal of progress is being made, though the project backlog is still high. Utilities and other asset owners are challenged with rebuilding the power delivery system as we move toward cleaner energy sources and prepare for the eventual presence of millions of electric vehicles on our nation’s roadways.
That’s why the engineer-procure-construct (EPC) project delivery method has become the go-to approach for nearly everyone in the transmission and distribution industry.
Early Collaboration Is Key
Today, there is widespread agreement that EPC results in more effective management of project risk, along with faster delivery and higher degrees of cost certainty. For highly complex projects in the transmission and distribution space, EPC enables early project collaboration between project team partners and owners. Earlier contractor involvement in the full project scope allows the integrated project team to surface challenges much earlier in the planning and design cycle. This creates more opportunities for savings and efficiencies to be engineered into designs before any construction begins.
A Real-Life Example
A recent project for Entergy Louisiana helps illustrate the point. As one of the largest utilities on the Gulf Coast, Entergy has been hammered by extreme weather events in recent years. As a result, it is investing billions to harden its systems for faster disaster recovery.
In early 2017, we received a notice to proceed with one of these key projects: a 24-mile transmission line and substation upgrade on a critical portion of Entergy Louisiana’s system. The project was made more challenging by the fact it would go through the heart of Louisiana’s bayou country — one of the most fragile ecosystems in North America.
When Entergy awarded the project, our team knew immediately we would face unprecedented challenges. Thanks to the EPC structure, a comprehensive team was assembled early and included environmental specialists who helped us devise a construction plan that would create the least impact on the broad and unique array of wildlife, wetlands, cypress forests and plant species we encountered. For example, we designed special monopole transmission structures that could easily be flown in by helicopter, to be installed by ground crews waiting below. Tree and brush removal along the rights-of-way required special equipment for either mulching in place or incinerating by using air curtain burners (ACBs) to create the least impact possible to wetlands. We also had eagle spotters on hand to make sure that helicopters would not disturb any nearby nests.
Beyond environmental considerations, all construction phases required extraordinary planning and schedule coordination. Due to right-of-way constraints in two residential subdivisions, 1-mile and 0.5-mile segments of new 230-kV line had to be built in the same location as existing 115-kV H-frames utilizing new monopole structures, creating a section of back-to-back, vertically configured circuits within the existing right-of-way.
A large and critical substation also required significant upgrades, requiring a new 230-kV, 5-breaker-ring buss to be constructed with room in the layout for expansion to a 6-breaker buss. To allow for additional bay construction at this station, three existing lines had to be rerouted. All these upgrades and new construction required precise outage scheduling for interconnections to other substations along the route to prevent interruptions of service to Entergy’s customers.
Determining the Optimal Delivery Method
The experiences on Entergy Louisiana’s project and countless others across the country have proven time and again that EPC delivery enables the inherent flexibility needed to meet a vast array of project goals. No two projects are alike, so it is imperative that project teams work in a coordinated, collaborative manner to minimize unforeseen challenges.
It should be noted, however, that there are many nuances and variations within any given EPC contractual framework that owners need to be aware of in evaluating and selecting the right team — one that will be well-positioned to deliver successful project and community outcomes. For example:
- Does the team have a demonstrated track record of safety excellence? If safety is the highest priority, you can be sure your team is just as committed to all other aspects of project quality.
- Does the team have a record of delivering innovative solutions? Within an EPC contractual framework, innovation can lead to real value engineering and not just a “wow factor.”
- Does the contract fairly allocate risks and rewards to all parties? Flexible terms indicate that fairness is a guiding principle for all parties.
- Does the EPC partner really understand your business? If the partner does, you are more likely to get a project delivered with assets that will perform reliably over many years.
EPC delivery excels in situations of well-defined scope of work where clear goals and expectations are set. When this is the case, specific progressive EPC contracting strategies can be agreed upon to create your best chance for a successful project.
Another utility wanted to improve reliability and increase capacity, requiring fast work to acquire new right-of-way, rebuild the line and upgrade substations along the route. See how EPC made it happen.