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2026.10.05 | TB | Energy | Solv Energy Lifecycle & Supply Chain

原标题：Solv Energy – Integrated Lifecycle Advantages & Supply Chain Pressure

#energy #power

Third Bridge · 2026-10-05

Analyst-led • 23 Sep 2026

Companies: MWH US

Patrick Price (PP) Construction Superintendent at Outback Contractors Inc

Isaiah Rodgers (IR) — Third Bridge Sector Analyst

Agenda

Key Insights

Introduction

IR [00:00:02]: Welcome to the Third Bridge's Interview entitled Solv Energy – Integrated Lifecycle Advantages & Supply Chain Pressure. I am Isaiah Rodgers, and I will be facilitating today's Interview with Patrick Price, former Operations Manager at Solv Energy.

Patrick, before we start today's Interview, could you please state either I agree or I disagree to the following statement: You understand the definition of material non-public information and agree not to disclose any such information, or any other information which is confidential, during this Interview.

PP [00:00:33]: I agree.

IR [00:00:34]: Thank you, Patrick. Could you please get us started with an introduction to your background?

PP [00:00:40]: My name is Patrick Price. I am a 38-year in the industry, electrician. I've worked in power generation pretty much the entire time, doing everything from combined cycle systems to battery energy storage, solar and more developed into the high-voltage aspects of it for substation and interconnection. I worked for Solv Energy for approximately one year. I was their high-voltage operations electrical manager. I have extensive experience, a master electrician in multiple states here in the United States and have been directly working with utilities in the western region for the past almost 20 years.

Questions

00:01:57] What operational and interconnection hurdles does Solv Energy typically face when converting a project from an LNTP [limited notice to proceed] to a full NTP [notice to proceed] on time?

PP [00:00:49]: LNTP to a full notice to proceed is a little complex because quite often, it depends upon what the clients' requirements are in the LNTP, if it's just engineering and procurement at the beginning vs actual moving into the construction aspects of it. One of the big bottlenecks, of course, is when you're doing LNTP, if the restraints from a client are, "We just want engineering and we want procurement options across that." It is basically holding you to schedules and deliverables from their selected vendors on that. Usually, you're working directly with the client to say, for, in particular, say, battery energy storage, you may be using something like a Tesla battery or a Fluence or Sungrow. All of those have different long lead time to them. I would say the conversation goes from, "Is engineering completed? Is it actually set at a 30%, 60%, 90% or actual issued for construction?" Normally, they're not at issued for construction when they actually execute the full notice to proceed on them. They're still working through some of the things of the engineering design, but normally, they have selected their material vendors. Procurement is probably the biggest bottleneck.

IR [00:04:34]: What did you mean by the 30% or 60% or 90%?

PP [00:04:37]: That's your design levels. At a 30%, you're doing a conceptual design. You know you want a 200MW productive solar field and then you're going to have battery capacity to a certain percentage of that. At 60%, they've now defined it as this is the equipment that we want to use. These are the different things that we need in there, fire protection, comms, control, so on and so forth, layout of where it's going to actually be in a general arrangement. 90%, you're usually getting down to where it's grammatical-type corrections that need to be done or anything that's been added by, say, the… What we call the JHA, the jurisdiction having authority, which could be the county, the state, the city, so on and so forth, but also at the 90%, there may be some controls, relay control and different monitoring schemes that are being tweaked within that. Then at IFC, of course, that's issued for construction. At that point, you should be down to everything that you need to build it out and ready to go.

00:06:16] At the 30% design stage of an LNTP, is Solv guaranteed that the client will convert the project to an NTP?

PP [00:06:27]: Usually, no, they're still working through the engineering on it. Again, depending upon what their agreement is with the client, it could be in the LNTP, they may be saying, "Hey, we just want you to do the design aspect of this and provide us with a bill of material," and they may even do the procurement. Normally, it's an EPC system, engineer, procure and construct, but sometimes it is just engineer and procure where they may be selecting other vendors for actual construction, not very often in that, but at 30%, you're just working through the design aspect of it. You can't really get a full… You get what we would call a class-five estimate across it, which means that there could be a pretty big swing in what your overall construction cost is at that point because you don't really know all of your install that you're going to have. You may be dealing with items like how long are your driven piles for your supports for your solar fields? What size batteries are you going to be using? How many are there going to be? What's your interconnect on it, things of that nature?

60% design, you get a little closer to that. Then at that point, you're really leaning closer to your full notice to proceed, but normally on the LNTP to the full notice to proceed, you're making sure that you've met all the qualifications, all of the environmental and governmental restrictions, you've clarified everything. You're down to where you're at a class-three estimate that's coming in. By the time you're at 90%, you should be really close to having a dedicated estimate for it.

00:08:51] How frequently does an LNTP convert into a full construction contract for Solv?

PP [00:09:06]: I would say you're in a range from 80% right up to 100%. Normally, when they've gone through the process all the way to the 90% design factor on it, they, being the client, have already worked through all of their financing that they're doing for the projects and have all of their land procurement, all of their interconnect agreements and things of that nature.

00:09:43] What is the typical timeline for a Solv project to progress from 0% through the 30%, 60% and 90% design stages to the start of construction?

PP [00:10:00]: Again, it would depend a lot on the complexity and the size of the project, location. There are a lot of things that you can run into out here in California. Of course, you have a lot of government oversight and permitting regulations that you're going to run into that could make that process go out quite extensively. The 30%, usually at that, at 30%, what you're doing there from zero to 30% is the client has given you the base concept, the location of where they're going to be doing the work, and the size and scale, scope of the job. At 60%, you've moved into… You've already gone in and submitted on environmental regulation for permitting. You've started working with your development in your engineering that you're putting back to the JHAs for review and comment and input. That could, again, depending on size and scale, that could run anywhere from nine months to one year, 1.5 years between zero to, say, 90%.

00:11:34] What are the typical payment terms for a Solv project? Are they structured as upfront or milestone payments?

PP [00:11:42]: Usually, it is set up into a milestone process where it's on deliverables, depending, again, on what the client request is because a lot of times, your actual deliverable that you give them is what triggers some of their construction loan costs or their release of financing through whatever methods they've set up. You will usually set up an agreed, "At 30%, we feel that we're going to have X amount of our engineering hours at a cost of this, and then once we deliver a 30%, you've done your review as a client, you've accepted it, then you would do a milestone payment across that." Each step is normally set up with milestones.

00:12:38] What typical margins are set for Solv on LNTPs?

PP [00:12:49]: That, again, varies. A lot of times, it would depend upon what is the amount of risk that you would have for it? Is it a project that is actually… You feel it's a strong client that they're absolutely going to have everything flow through and build out the project. You would range your margin across that. Normally on that development, that pre-construction development, you might come in at a slightly lower margin or mid-range, which is standard for the construction industry, knowing that once you go into construction, you're looking at what your construction margin should be. Ranging, it's hard to say. I would tell you you're probably in that 12-19% range across that, but again, it could vary. If it's a client you've worked with quite a bit and you have full confidence in them or you've done previous projects with them, then you may reduce that risk a little bit.

00:14:25] Why do utility and data centre clients ask EPC [engineering, procurement and construction] contractors to procure long-lead materials? Do these contractors hold the equipment on their own books?

PP [00:14:43]: Some EPCs do. Some EPCs go out and actually do pre-purchase agreement with some of your larger vendors, your Siemens or Mitsubishi or someone like that for your transformers on your substation side, Southern States or Royal for your switches, insulators, things of that nature. Battery procurement on BESS has become a major item because so many BESS units are now being either attached to existing solar systems or they're built in conjunction with the solar systems now for continued generation. There's just a lot of people buying it. The other aspect of this is data centres are buying a lot of the same equipment at this time.

00:15:46] How often do EPC contractors hold the long-lead equipment themselves vs the actual clients?

PP [00:15:58]: It depends upon what you're doing in your LNTP agreement on that. If the client is saying, "Hey, we want to pre-purchase on this," and they know the equipment that they're going to do, you usually would build that into one of your milestones to say, "Okay, we know that some of this equipment has a two-year delivery on it. We need to get it on board." It's becoming more common that your EPC vendors are actually going out as some of your larger ones. I don't know if I can call out names, but I would say Quanta Services or somebody like that that has a broad spectrum of construction companies. They do more than just solar and BESS. They may be out there pre-purchasing some of the longer lead items such as transformers and substation equipment. Batteries usually pre-purchase is just difficult on that because they are literally dedicating that purchase out and delivery schedules out as it's awarded.

00:17:25] Solv's management noted that the company will pull forward revenue in 2026 due to project acceleration. What site-level conditions allow the company to accelerate mega-scale builds ahead of schedule?

PP [00:17:41]: Usually, it's a client commitment. If you have an interconnect agreement with the utility that you've agreed that you're going to be generating by a certain point in time and to a certain scale, a lot of times there are penalties that are affected in that. You want to make sure that you're doing everything on the front end to try to make sure that you're meeting those committed dates and the interconnect dates to keep from running into delay payments or what they call lost revenue generation.

IR [00:18:30]: What penalties might Solv face if the company is at fault for project delays?

PP [00:18:39]: Under normal conditions, you're going to put that into your terms of contract with your client as to what their full-on generating capability would be and then what, basically, the kilowatt-hour price would be for the loss of that revenue. Normally, as a percentage, it's shared as a risk evaluation, you'd say, "Okay, we're going to accept 70% of lost generation revenue for our not meeting an interconnection date." Usually, it can run day by day. It can run weekly, monthly. It usually hits a cap. They'll say, "If you're extended out past, say, 60 days, there'll be a cap of what that lost revenue value would be," in agreed contracts.

00:19:53] What are Solv's primary operational bottlenecks that cause project delays? Do they typically stem from high-voltage substation tie-ins, site civil issues or third-party equipment?

PP [00:20:13]: Mostly, what I would say to that is that it's delivery from vendor. It's material. The biggest thing that you run into is a material vendor will give you a date, anticipated delivery date, but that can have major slippage. One of the issues that all EPC constructors are dealing with right now is that there's very limited liability on that vendor to provide you that equipment by a set delivery date. You don't have a lot of go back on them when it comes to, "Hey, I need a transformer. You need to send me a 135 MVA transformer," and they're making it in, let's say, Mexico, Virginia, Georgia Transformer builds out of Mexico. A lot of other vendors build out of, Hitachi, Mitsubishi all build out of the far east. Some of them have developed plants here in the United States to build, but even that, again, you've got so much infrastructure construction going on for the electric utility that it's almost a first come, first serve, who's going to pay the most to get it there on time.

IR [00:22:03]: How much have lead times for transformers and switchgear extended over the past 12 months?

PP [00:00:08]: They have gone to where it's almost a 2.5 year from… When I say 2.5 years for delivery is what I mean in this, and that is from agreed-upon design. You can request a certain size voltage, high and low voltage and specs across the transformer, but until you have a completely signed, agreed, "These are the engineered specs, these are the different relay settings that I'm going to be monitoring across it. This is what I need it to do." From that date where you actually sign off on it and you give them their upfront payment, it can be two years, 2.5 years, depending upon the size and type.

00:23:12] Are there any raw material cost inputs that have experienced the most significant spikes recently?

PP [00:23:22]: Yes, yes. Structural steel components, steel has seen quite a bit of increase. Copper prices have gone up, which all of your control wiring and things of that nature and your supply wiring. Copper and aluminium, your metals have increased dramatically. You're seeing, of course, with the issues that we're having with fuel costs right now are really impacting everybody. Construction equipment running on diesel. When you bid a job two years ago or put together a proposal for a job two years ago, and you're talking… You've got basically 100% increase, you went from USD 3 to USD 6. It's basically impacts your cost and being able to put any of that into a flow-down is difficult. You do have some terms within contract agreements that will allow you to do that. One of the big items that I always look for is to make sure that you're able to do evaluations over a set period of time in the event of tariffs or increased commodity costs on it.

00:24:47] How easy or difficult is it for Solv to pass through the cost spikes to a client mid-contract?

PP [00:24:59]: Again, terms of contract in that. Usually, there are some things that are outside control, but you get to do a reevaluation across it depending upon, again, size and duration of the project. Some things you're locked into. If you have a committed cost from a vendor when you purchase… In your purchase agreement with them, then usually the only thing that they wind up increasing is your delivery cost across it, but that could be a sticking point, again, depending upon how your contract's written with them and what you put in there for commodity terms.

00:25:56] What is the role of fuel in Solv's supply chain?

PP [00:26:09]: Fuel is pretty large. There's a lot of equipment involved with the installation of solar and BESS and substation across all of that. Again, with the recent spikes that we've had over the past six months or so, it's really hard to determine on how you can pass that cost along. It's one of the major costs in a MoM basis on that because depending upon what stage of the construction you're in, if you're at the high point of construction right now and you've got 300 pieces of equipment out there or more running each day, your volume of fuel consumption could be just dramatic.

00:27:16] What percentage of total build-out costs does fuel account for in a typical Solv project?

PP [00:27:25]: Hard to lock that down. Again, a lot of that is contingent across footprint of a project and size and scope, but I would say you're probably, especially right now, you're looking at it probably 15-20% overall value of project gets ate up in consumable and fuel.

00:27:56] Do EPC contractors such as Solv typically implement fuel surcharges that update on a weekly basis, similar to those in the transportation and logistics industry?

PP [00:28:08]: It actually is, especially for your delivery of items. At time of purchase, it may have been one thing, but now that you're looking at a delivery date two years in the future, you have within your purchase agreements that they are allowed to adjust that surcharge based on relevant cost at time of delivery.

00:28:45] Solv is executing an increasing number of hybrid PV [photovoltaic] plus BESS [battery energy storage system]. What are the differences in technical complexity and labour requirements when building high-voltage substations for the company's hybrid PV and BESS vs traditional solar-only facilities?

PP [00:29:07]: Solar-only, it's a lot more repetitious as far as the… You go in, drive the piles, you set the torque tubes, you put the modules on and you do your interconnect wiring. It's just very repetitious across any solar project, standalone solar project. Battery, once you've done battery interconnection on it, you're increasing your output capacity, you're also increasing your footprint size, you're permitting, you're increasing the size normally of your substation for your interconnect, your transmission generation interconnect. Some owners, some clients will do what we call a tandem where the solars and the batteries are tied into the same breaker connections within the substation. Others do it independently. That way, if they have any issues, say, the loss of one of their zones of solar, they can still operate their battery in it. It depends upon design on that, but it's very commonplace now that the providers, clients are putting in battery paralleling with their solar generation because that gives them an extra 4-8 hours of generation revenue that they can collect.

00:31:07] Are there significant pricing premiums for Solv when building hybrid PV and battery energy storage projects vs traditional solar-only facilities?

PP [00:31:14]: Yes, usually because if you're doing solar-only, your labour skillset on it is much broader. You get basically a lot of labourers and equipment operators that are doing the bulk of the work with a limited number of electricians and iron workers, your, what I'd say, skilled crafts are, where when you go into battery and you go into substation, you're dealing with trained linemen or electricians, you're dealing with fire protection people, you're dealing a lot more with your concrete placement and concrete finishing, structural steel, things of that nature. You're using, for an easy way to say this, you're using a higher paid and higher skillset labour force when you're doing batteries and substation.

00:32:41] How much more can Solv charge for the hybrid projects vs regular standalone facilities?

PP [00:32:49]: Good question. I don't know that I could throw a figure to that. I would say that you're probably… Cost to build a substation and cost to implement a battery system, you're dealing with a lot more expensive equipment. Your labour cost, of course, is quite a bit higher on it. Again, you could build five square miles of solar field, but you may only be dealing with 20-30 acres across the footprint of a substation and a battery system. Depending upon, again, size and scale, I would say that cost could be significantly higher just due to equipment and labour costs for that. I couldn't give you a range.

00:33:58] What are the differences in engineering specs and build-out timelines for rapid energy projects driven by hyperscalers and data centres vs traditional utility projects?

PP [00:34:20]: Quite a bit. The amount of power consumption that data centres have or use is on a scale, far, far exceeding your standard utility build-out. You may have noticed that a lot of the data centres are actually building their own co-generation facilities to tie in to their battery systems and their grid consumption. That way, they're not trying to draw off the grid or limiting how much they're drawing off the grid. With that, the project complexity is just vastly greater. It's beyond belief of what it would be just to do a utility substation and interconnection. They're phenomenal as far as electrical goes on and mechanical because all of the cooling systems, the… Just the consumption of the energy for the racks and all that stuff built within them.

00:35:47] Is Solv equipped to handle complex dual-source builds, or does the company still need to develop those specialised capabilities?

PP [00:35:59]: I would say they've been doing it for quite a while now. From the time that I was with them, they were already deeply involved in doing the battery and solar combined system. Again, what I will say to that is it also depends upon location, region that you're dealing with it in and what your competition is for labour workforce. That has been difficult when you're starting to talk about areas like Texas, West Texas, New Mexico, Arizona, which have been building out solar infrastructure just like crazy. When you have various EPC contractors that are competing for the same workforce, not to mention what's going on with data centre as well, especially your technical and skilled workforce. It could be challenging.

00:37:21] How is client demand trending for prefab modularisation across Solv's renewable energy and substation projects?

PP [00:37:39]: I think it's really just now moving into the industry. It's been out there for a while, but it's really becoming a little more commonplace where you can get a company such as Dis-Tran or… Oh gosh, I can't think of… There are 2-3 companies that are actually building, what we call breaker skids and things of that nature. Your solar and battery systems are almost all 34.5 kV, so 34,500V systems. Being that those systems are common, you can build out prefab for those. Then the only thing that really changes is your interconnect into your high voltage, your transmission, what we call a GSU or generation step-up unit, which is your main transformer to tie at the utility.

IR [00:38:51]: Do prefab modular substations have the potential to drastically decrease labour costs and overall timelines for project build-outs?

PP [00:39:01]: I would say yes, because what they can do is they can build them in a factory-type setting vs stick building it in an outdoor environment. They can actually do it in areas where your labour rate is much less expensive. As opposed to stick building something in California, if you're a factory building it in, say, Alabama, you're going to have a pretty dramatic labour cost difference across that. I think that they can actually… That industry will probably be growing. It's going to become more commonplace because you can build it out, load it onto a truck and ship it out to wherever. Again, you're building it inside a factory, you're not getting weather impacts and loss of production across those kind of things.

00:40:17] How much project work does Solv self-perform vs outsource to subcontractors?

PP [00:40:30]: A lot of the civil aspect when it comes to the substations and battery is usually done through third party. Your preliminary grading even in your solar fields out there, preliminary grading, site prep, I'd call it, 50/50 maybe on foundations depending upon where they're at. Again, it depends upon what they're running into for labour demands across that for foundations, things of that nature. They have been self-performing quite a bit of the substation work and the battery. They've recently got to where they were self-performing a lot of the battery work. Third-party-wise, it's going to be your technical and licensed-type vendors, your fire protection vendors, your civil vendors, electricians, as long as you have the required state licensing for those, you can be drawing those from different work source providers and self-performing.

IR [00:42:09]: What pricing premiums do subcontractors charge compared to Solv's self-performance costs?

PP [00:00:14]: I would say you're going to see anywhere from a 30% to maybe 35%, 40% increase in cost to have a third party do it. It is quite a bit to have that third party, but that third party is… It may be a smaller local company that's doing it. Therefore, what they're having to pay in rate and insurance and things of that nature might be a little bit higher, might be… Their cost to do business might be a little bit higher vs somebody that can do bulk buying. Again, I would also preface that with… It depends upon what craft you're using. Sometimes when it comes to your civil vendors, you can get a pretty good deal across those because you've got several of them that are competing for it. Competitive bidding process is pretty important.

00:43:30] How severe is the current shortage of specialised high-voltage union electricians and substation technicians for grid, solar and data centre projects?

PP [00:43:41]: There's quite a shortage of them, to be honest. The couple of issues that's going on in conjunction with not just the data centres, and the solar build-out is that grid infrastructure needs to be upgraded. Interconnects, just tying on to anywhere from a 30-80-year-old grid system, it's challenging. Utilities are taking on a lot more work to upgrade their systems so they can provide that capacity, grid capacity on it. Data centres, you're looking at a shortage of skilled electricians, somewhere in the range of 20,000 people at the moment. Again, it's regionalised. When you're saying how many they're building in Virginia and then Texas as far as data centres go, Virginia probably doesn't have as much competition across the solar industry, but the batteries are going to be built alongside the data centres, whereas Texas has not only data centre build-out, but they also have solar renewable infrastructure that they're building, therefore, that competition for those skilled labours is much, much higher.

00:45:19] How much are wages for skilled electrical union labourers expected to increase over the next 12-24 months?

PP [00:45:33]: Difficult to determine because our economy at the moment here in the US is in such fluctuation across everything. With the set pace of inflation and just lack of the skilled labourers, they're able to negotiate much better contracts, especially on the union side. Do I foresee them doing that asking for the moon? I don't. I do think standard across your negotiated labour rates runs anywhere from 5-7% annually. Could that change for anybody that's negotiating new contracts or labour impacts over the next 12-24? It could. I do know that several electrical unions are now paying premiums to try to get people on board. There are several, you could… Anybody could go to the IBEW sites and look at the various job boards, but some of them are paying incentives of all their premium times paid at double time vs time and a half. They're paying additional per diem rates to get people to come out to some of these remote locations. They don't normally put solar and battery systems or data centres in heavily-populated areas.

IR [00:47:29]: All right, I do think that is a great place to end our call today. I want to thank you for joining me on this Third Bridge library Interview and for all the insights that you brought to us today.

PP [00:47:38]: Absolutely.

Transcription ends at 00:47:44 of the recorded material