superiority
First, EPC general contractor is responsible for the implementation process of the whole project, and no longer acts as a separate subcontractor to carry out the project construction, which is conducive to the overall planning and cooperative operation of the whole project, can effectively solve the connection problem between design and construction, reduce the intermediate links between procurement and construction, and smoothly solve the contradiction between practicality, technology and safety in the construction scheme;
Second, the scope of work and responsibilities are clearly defined, and the responsibilities and risks during construction can be transferred to the general contractor to the greatest extent;
Third, the total contract price and construction period are fixed, and the owner's investment and construction period are relatively clear, which is conducive to cost and schedule control.
Fourth, it can give full play to the advantages of all parties in project management and achieve the goal of project management;
Fifth, the owner can be liberated from specific affairs, pay attention to the major factors affecting the project, and ensure the general direction of project management.
disadvantaged
First, the owner mainly supervises the EPC contractor through the EPC contract, and the degree of participation and control in the project implementation process is low;
Second, the owner will transfer the project construction risk to the EPC contractor, so the selection of the contractor is very important. Once the contractor has major problems in management or finance, the project will also face great risks;
Third, EPC contractors have great responsibilities and high risks, so contractors will consider management input costs, profits and risks when undertaking general contracting projects, so the project cost level of EPC general contracting contracts is generally high;
Fourth, it is quite different from the traditional construction mode, so it is difficult for traditional industry owners to understand and cooperate with the contractor's work.
Extended data
Several contract structure forms of EPC general contracting mode in practice.
Under EPC general contracting mode, the general contractor is responsible for the whole construction project, but it does not mean that the general contractor must complete the whole construction project by himself. In addition to the work that the law clearly stipulates that the general contractor must complete, the general contractor may take the form of professional subcontracting for the rest of the work. In practice, the general contractor often subcontracts equipment procurement (manufacturing), construction and installation to professional subcontractors according to his rich project management experience, different scales and types of engineering projects and the requirements of the owner. Therefore, in the EPC general contracting mode, its contract structure usually takes the following forms:
(1) turnkey general contracting;
(2) Design and procurement general contracting (E-P);
(3) Procurement-General Construction Contract (P-C);
(4) Design-construction general contracting (D-B);
(5) Construction-Transfer (BT) and other related modes. The most common are the first, fourth and fifth forms.
Turnkey project general contract refers to the general contract of design, procurement and construction, and the general contractor finally submits the project that meets the use function and has the use conditions to the owner. This model is a typical EPC general contracting model.
General contracting of design and construction means that the general contracting enterprise undertakes the design and construction of the project in accordance with the contract, and is fully responsible for the quality, safety, construction period and cost of the contracted project. In this mode, the procurement of building materials and construction equipment involved in the construction project is completed by the employer (owner).
Construction-to-transfer general contract refers to the general contract for the whole process of exploration, design, procurement, construction and trial operation of the project, which is entrusted by the owner and has the ability to invest and finance; At the same time, the general contractor shall bear all the investment of the project. After the project is completed, the owner pays the total contract price to the general contractor.
References:
General contracting of EPC project of Baidu Encyclopedia