Introduction
Selecting an EPC (Engineering, Procurement, Construction) contractor is one of the most critical decisions in any energy storage project. It’s not just about price – it’s about choosing a partner who will build your facility and be responsible for its quality throughout the warranty period (typically 2 years).
If you decide to combine the EPC contract with long-term O&M (Operation & Maintenance), the relationship may last 15-20 years. But even if you plan to separate these roles – the choice of EPC contractor determines the quality of the asset you’ll be operating for the next two decades.
Problems on construction sites always happen. The question is: will your contractor resolve them proactively, or will you have to fight for every fix?
In this article, I present 6 key criteria you should verify before signing an EPC contract. Additionally, I’ll discuss the often-overlooked topic of spare parts and service availability – because that’s where most investors make costly mistakes.
Criterion 1: Proven Track Record
Minimum Requirements
Before you start discussing price, verify the contractor’s experience:
- Completed BESS project – not “planned,” not “in preparation,” but actually built or at least under construction – and certainly not Gigawatts in the Pipeline!
- Minimum 1 completed utility-scale renewable project in the last 36 months – if the contractor hasn’t built a large PV or wind farm, your energy storage project will be an experiment at your expense.
- Client references – not generic reference lists, but specific contacts you can call and ask “what was it like working with them?”
Red Flags
Watch out for contractors who:
- Have “BESS experience” only from presentations and conferences
- Show projects “in pipeline” instead of completed installations
- Cannot provide specific reference contacts
- Are still “building competencies” in energy storage
Why Does This Matter?
BESS is not “the same as PV or Wind.” Grid integration of battery systems, fire safety certification, BMS-EMS-SCADA communication, TSO testing, and frequency market certification – all of this requires specific know-how. A contractor learning on your project will be learning on your money. You can afford that, but at least make it a conscious decision.
Criterion 2: Financial Stability
What to Check?
A BESS project worth several tens of millions PLN requires a contractor who:
- Can issue bank guarantees (Advance Payment Bond, Warranty Bond, or Performance Bond) corresponding to contract value – typically 10-15% of project value
- Has available funds or credit lines to continue work – the contractor must order equipment worth tens of millions, pay subcontractors and suppliers – project cash-flow isn’t always positive
- Has insurance covering energy storage-specific risks – a standard construction policy may not be sufficient
- Can present 2-3 years of audited financial statements – if the company wasn’t doing well in recent years despite completing projects, will it be different now?
Why Verify This?
Imagine this scenario: the contractor went bankrupt mid-construction. You have a construction site with partially installed equipment, no documentation, suppliers demanding payment, and you need to find someone to finish the project. Cost? Often 30-50% more than the original budget. Contractual security? Maybe it was there, but from whom will you recover that money now? These are long-term projects and should be approached accordingly – both regarding contractors and suppliers.
Practical Advice
Request:
- Credit rating (if available)
- Bank certificate of creditworthiness
- List of currently ongoing projects (to assess if they’re “stretched thin”)
- Information about ownership structure (is it a subsidiary of a larger group?)
Criterion 3: Engineering Competencies
The Team You Need
A good EPC contractor for BESS should have as many competencies in-house as possible (subcontractors alone won’t suffice):
Engineers and designers with Polish certifications
- MV/HV installation design (medium and high voltage)
- Knowledge of Polish standards and regulations
- Experience with DSO/TSO procedures
- Completed technical/detailed and as-built designs
- Ability to conduct grid connection tests
Construction team
- Site manager with proper certifications
- Experience with infrastructure facilities
- Experience with BESS systems
- Knowledge of battery manufacturer testing procedures
In-house vs. Subcontractors
Let’s be honest – there are no companies that can execute large-scale renewable projects from A to Z without hiring subcontractors. Nobody maintains hundreds of people, huge machinery fleets, or massive quality departments controlling all design and construction work. However, there’s a huge difference between having your own people with technical experience who can control external companies’ work and impose certain execution standards, versus outsourcing everything and just collecting margin. Anyone who has participated in such a project knows that without proper control and knowledge on the supervising side, everyone will do whatever they want, and in the end, the investor is left with a project that is simply defective.
Owner’s Representative / Owner’s Engineer
It’s worth mentioning an often-overlooked aspect, especially in smaller projects. The investor, as a private person or a company doing something completely different from renewables, believes that by hiring a General Contractor or EPC company they’ve solved all problems and can peacefully wait for construction completion and ribbon-cutting on an already operating project. Nothing could be further from the truth. Just like on any construction site where the foreman watches the workers and the site manager watches the foreman, the Investor should participate in work progress here too. Does this mean everyone needs to understand construction and electrical work? No. If you don’t have your own technical departments responsible for project supervision, hire specialists who will do it on your behalf.
Questions to Ask
- How many people on the team have Polish construction/electrical certifications?
- Who will be the project manager and what’s their BESS experience?
- What will be the structure of people working on this project?
- Will the General Contractor have permanent presence on site?
- Is the acceptance team internal or external?
- How does collaboration with the battery manufacturer work during commissioning?
Criterion 4: Supply Chain Security
Supplier Diversification
In current market conditions, the contractor should have:
- Framework agreements with minimum 2 tier-1 battery suppliers (e.g., CATL, BYD, Hithium, SolaX, or Trina)
- Ability to integrate different technologies – each project is different and we can’t rely on just one manufacturer
- Contingency plans for supply chain – what if the preferred supplier has delays?
Why 2+ Suppliers?
The 2021-2022 situation showed how quickly supply conditions can change:
- Delays in Chinese ports
- Container problems
- Raw material price changes
- Export restrictions
Additionally, it’s worth noting that NFOŚiGW (National Fund for Environmental Protection) has just announced subsidy results in Poland, where 183 projects were qualified to receive direct grants for Energy Storage investments. Just a week ago, LFP battery storage manufacturers didn’t know what to do with their production capacity. Today? The situation is changing drastically and we may soon have delivery timeline problems. Will this happen? Hard to assess, but having relationships with several manufacturers and suppliers may lead to faster completion of your project.
What to Check?
- Does the contractor have experience with more than one battery manufacturer?
- What do their supplier relationships look like? (framework agreements vs. spot purchases)
- Do they have alternative suppliers for key BoP components (transformers, switchgear)?
- What’s their plan B if the main supplier fails?
Criterion 5: Long-term O&M Capability (Optional)
EPC vs EPC + O&M
You have two options:
Option A: EPC Contract Only
- Contractor is responsible for construction and 2-year warranty period
- O&M ordered separately (combined with LTSA from supplier or full scope from a service company)
- External O&M can verify the General Contractor before warranty expires
- More flexibility, but requires coordination
Option B: EPC + Long-term O&M
- One partner for construction and 15-20 years of operation
- Full responsibility for quality (because they’ll be servicing it themselves)
- Often better warranty terms
- Negotiations only once
If You’re Considering Option B – What to Look For:
- Ability to provide O&M services for 15-20 years – will this company exist that long?
- 24/7 monitoring – not “during business hours,” but truly round-the-clock
- Local service presence – technician in Poland, not “in Europe”
- Clear handover procedures – documentation, training, knowledge transfer
Linking EPC with O&M
The best EPC contracts include:
- Option for long-term O&M with pre-negotiated terms
- Performance guarantees linked to O&M contract
- Clear division of responsibility during the transition period
Criterion 6: Grid Integration Experience
Polish Market Specifics
Connecting an energy storage facility to the grid in Poland is not a formality. You need a contractor who has experience working with Polish Grid Operators, knows how to communicate with them, and what they can expect. Energy storage is a new topic for everyone, so both DSOs and PSE (Polish TSO) don’t have established processes like they do for PV installations. Documented relationships, confirmed agreements, and participation in acceptance tests are major advantages for a BESS General Contractor. Therefore, it’s advisable to look for:
Experience with Polish Grid Operators
- Understanding of transmission system operator requirements
- Conducting ION, EON, and FON tests
- Leading negotiations with Tauron, Enea, Energa, and PGE
- Understanding differences in procedures between operators
- Direct contacts that accelerate processes
Understanding of Capacity Market and Frequency Market Obligations
- Requirements for units with capacity contracts
- Testing procedures
- Reporting and settlements
- Knowledge of certification process for providing balancing services or frequency market participation
Grid Energization Realities
Anyone who hasn’t gone through the energization process of a small or medium PV farm has no idea about the intricacies of this system. Being honest, a foreign contractor without staff originating from Poland has no chance of completing this process. Obviously, problems would occur at much earlier stages, whether it’s the amended building permit or detailed design negotiations with the operator. Every market has its own conditions and procedures, so I don’t think Polish administration differs in this respect from others, but certainly the required documents and time spent on yet another request for completion is completely incomprehensible to someone from abroad. This is worth remembering when choosing an EPC contractor.
Practical Question
The previously mentioned requirements regarding references will answer most of your questions. If the EPC has already participated in building a renewable installation of similar capacity or type, it means they’ve been through this process at least once. It’s hard to require documented energization of an energy storage facility when there aren’t many of these installations at present. Therefore, PV and Wind are equally important.
Optimizer
The previously mentioned requirements arising from wanting to participate in the frequency market or balancing services, as well as maximizing arbitrage profits, setting charging and discharging schedules – this is the optimizer’s domain. It’s worth ensuring the selection of a company that will participate in the project from the very beginning. The optimizer’s contribution to project execution may not be large, but such a key element as telecommunications architecture is something that, in my opinion, the optimizer should be involved in. This will allow for including the full list of signals required by PSE, and consequently avoid delays in certification that must be conducted with PSE. This is another element of this very complicated puzzle.
Timeline and Milestones
Verifying Schedule Realism
Every contractor will present you with a project schedule. The question is: is it realistic? Here’s what to look for:
Typical BESS project timelines (utility-scale):
- Design and approvals: 3-6 months
- Equipment production and delivery: 4-8 months (depending on manufacturer and current market situation)
- Construction and installation: 4-6 months
- Commissioning and testing: 2-4 months
- Energization and acceptance with DSO/TSO: 2-4 months
Total: 15-28 months from contract signing to full operability.
If the contractor promises a significantly shorter timeline – ask how they intend to achieve it. Maybe they already have equipment in stock? Or maybe they haven’t accounted for all stages?
Most Common Causes of Delays
- Equipment delivery delays – especially batteries and transformers. After the NFOŚiGW results announcement, the situation may intensify.
- Extended DSO negotiations – administrative procedures are unpredictable.
- Changes in detailed design – resulting from operator or TSO comments.
- Subcontractor problems – crew unavailability, quality issues.
- Weather conditions – especially during foundation work.
How to Protect Yourself?
In the EPC contract, it’s worth defining:
- Key milestones with specific dates
- Time buffer for unforeseen circumstances (minimum 10-15%)
- Progress reporting mechanism – weekly or monthly reports
- Change management procedure – what if the scope changes?
Liquidated Damages and Securities
Why Are Liquidated Damages Important?
Liquidated Damages (LD) are not a tool for “punishing” the contractor – they’re a mechanism that:
- Motivates timely completion
- Compensates for lost revenues in case of delays
- Balances negotiating positions of both parties
Typical LD Structure in BESS EPC Contracts
Delay LD:
- Typically: 0.1-0.5% of contract value per day/week of delay
- Cap (limit): usually 10-15% of contract value
- Calculated from Substantial Completion date or Commercial Operation Date (COD)
Performance LD:
- For not achieving guaranteed capacity (e.g., 95% of nominal)
- For not achieving guaranteed efficiency (round-trip efficiency)
- For exceeding guaranteed auxiliary losses
Linking with Performance Guarantees
A well-constructed EPC contract includes:
Performance guarantees with compensation mechanism:
- Guaranteed capacity: e.g., 98% of nominal at COD
- Guaranteed efficiency: e.g., 86% RTE (Round-Trip Efficiency)
- Guaranteed availability during warranty period: e.g., 97%
Settlement mechanism:
- If parameters aren’t met → contractor has specified time for repair
- If still not met → financial penalty or contract price reduction
- In extreme cases → right to terminate the contract
What to Watch For?
Too low penalties = no motivation for the contractor Too high penalties = contractor will price in the risk or refuse to sign
Balance is key. Penalties should be proportionate to actual losses you’ll incur in case of delay (lost revenues from capacity market, arbitrage, balancing services).
Spare Parts Reality
The Availability Guarantee Illusion
You signed a contract with 95% availability guarantee. Your storage facility is offline for 8 weeks waiting for parts. Your guarantee? Still met.
How is this possible?
What the contract says: “95% availability guarantee with spare parts delivery within contractual timelines”
What actually happens:
- Week 1: Component failure
- Week 2: Supplier orders parts ✓
- Week 10: Parts arrive
- Week 11: Installation
Your BESS: offline 10 weeks. Supplier: per contract, waiting time for spare parts is excluded from the guaranteed availability calculation formula.
Critical Questions About Spare Parts
Before signing the contract, ask:
About presence in Poland:
- Do you have technicians in Poland?
- Do they have Polish certifications and will they be allowed to work on live equipment?
- Where is the nearest spare parts warehouse?
- Is “European warehouse” Poland or 2,000 km away?
About supplier structure:
- Am I buying from the manufacturer or a reseller?
- If reseller – do they have their own parts inventory?
- Will this company exist in 5 years?
About availability definition:
- How exactly is availability calculated in the contract?
- What’s excluded from the calculation?
- What are maximum delivery times for critical components?
Spare Parts Strategy
During contract negotiations:
- Define the exact availability calculation method
- Specify maximum delivery times for critical components (BMS, battery modules, inverters)
- Include protection against product discontinuation
Practical safeguards:
- Purchase critical spare parts upfront and keep them on-site
- Require local warehousing with defined stock levels
- Look for an O&M provider servicing the entire facility, not just components
Red Flags – When to Walk Away
During discussions with potential EPC contractors, be alert to:
| Red Flag | Why It’s a Problem |
| “We have BESS experience” without specific projects | Probably learning from presentations |
| Unable to issue bank guarantees | Financial problems |
| “Our partner in China will provide service” | 2 weeks for technician arrival |
| Price 20%+ lower than competition | Either don’t understand scope, or claims will follow |
| “We’ll clarify details after signing” | Risk of misunderstandings and disputes |
| No Polish-language documentation | Problems with PSE or DSO approvals |
| Timeline significantly shorter than competition | Unrealistic assumptions or missed stages |
| Refusal of liquidated damages or very low cap | Lack of confidence in own capabilities |
Summary: EPC Contractor Selection Checklist
Before signing the contract, ensure your contractor meets:
✅ Experience
- [ ] Number of completed BESS projects
- [ ] If BESS project in progress – what stage
- [ ] Utility-scale renewable project in last 36 months
- [ ] Verifiable client references
✅ Finances
- [ ] Ability to issue bank guarantees (10-15% of project value)
- [ ] 2+ years of audited financial statements
- [ ] Insurance covering BESS risks
✅ Competencies
- [ ] Polish construction/electrical certifications in-house
- [ ] Experience with TSO/DSO
- [ ] Own team responsible for Execution
✅ Supply Chain
- [ ] Agreements with 2+ tier-1 battery suppliers
- [ ] Contingency plan for deliveries
- [ ] BoP component diversification
✅ O&M (if combining with EPC)
- [ ] Capability for 15-20 years of service
- [ ] Local presence in Poland
- [ ] Response times
- [ ] 24/7 monitoring
✅ Grid Integration
- [ ] Experience with BESS grid connections in Poland
- [ ] Knowledge of TSO and DSO procedures
- [ ] Understanding of capacity market and frequency market
- [ ] Collaboration with optimizers
✅ Timeline and Securities
- [ ] Realistic schedule with milestones
- [ ] Acceptable liquidated damages structure (Delay LD, Performance LD)
- [ ] Performance guarantees with compensation mechanism
- [ ] Progress reporting procedure
How Can We Help?
Selecting an EPC contractor and negotiating the contract is a process that requires experience and market knowledge. GreenEdge Solutions supports investors at every stage:
🎯 Tender Preparation and Management
- Developing contractor prequalification criteria
- Preparing complete tender documentation (RFP)
- Defining technical and contractual requirements
- Coordinating Q&A process
📊 Bid Evaluation
- Technical analysis of received proposals
- Price comparison and benchmarking
- CAPEX assumption verification – are prices realistic?
- OPEX analysis – hidden operation and service costs
- Risk assessment of individual bids
🔍 Owner’s Engineer / Owner’s Representative
- Representing investor interests during construction
- Quality control and project compliance
- Schedule and budget supervision
- Partial and final acceptance
- Coordination with contractor and subcontractors
📋 Contract Support
- EPC contract terms negotiation
- Review and optimization of warranty provisions
- Defining KPIs and penalty/bonus mechanisms
- Structuring EPC-O&M linkage
Planning an energy storage project and need support in contractor selection?
📧 contact@greenedge-solutions.com
🌐 www.greenedge-solutions.com
Related articles:
Complete Guide to BESS Project Delivery Models in Poland – EPC vs BoP
BESS Project Development in Poland: Why Most Energy Storage Projects Never Get Built