Developers and contractors at a recent event described how the generation buildout is forcing earlier engineering, procurement, and construction contractor involvement; deeper supply-chain tracking; repeatable designs; more deliberate risk allocation; and tighter coordination across plant construction, fuel supply, and grid access.
At the Energy Projects Conference & Expo (EPC Show) in Houston, Texas, in June, speaker after speaker—representing the full gamut of stakeholders in the current power buildout, from developers and utilities to engineering, procurement, and construction (EPC) contractors; hyperscale data-center buyers; and grid operators—described similar stakes from different vantages. While each is cognizant of the volume of announced generation, each is confronting the uncertain scale of large load guided by distinctive concerns. The seeming common thread, perhaps, is the schedule. Each is being pushed to commit earlier than conventional project development would ordinarily require.
The timing pressure, however, is multifaceted. Developers are reserving combustion turbine production slots years in advance, but even a secured turbine position now fixes only one line on the schedule, given that transformers, switchgear, breakers, and other long-lead electrical equipment follow separate, sometimes longer, delivery curves. At the EPC Show, contractors said owners are asking them to commit engineering resources and plan for scarce craft labor before designs are complete and risks are fully allocated. Utilities and grid planners, meanwhile, are weighing commitments against aging thermal fleets, constrained transmission, and hundreds of gigawatts of large-load requests from data centers. Increasingly, the schedule is being set less by an owner’s preferred sequence than by equipment availability, physical infrastructure, and the pace of permitting and interconnection reviews.
Earlier Decisions, Earlier Commitments
For EPCs, the crunch appears to be erasing the traditional handoff where owners developed sites and firm designs, before they then bid work. Contractors now say they are being pulled into projects at the site-selection stage, even as fundamentals—such as labor availability, water, interconnection pathways, and heavy-haul access—are still unsettled. Clients who engage early with a contractor—“which is what we love,” as Kyle Harris, business line manager at Kiewit, noted—stand to gain EPC expertise that could pre-load and test for constructability questions, such as a project’s labor supply, equipment logistics, and interconnection. “When you get a client that understands those risks and is engaging all the parties early, that’s when you have these most successful outcomes,” he said.
The same discipline has cost implications, he said. For now, turbine prices are forecast to keep rising through 2027, Harris said, and field-side constraints—including labor, sub-suppliers, and non-turbine equipment—face similar capacity limits. “In order to get cost certainty, you have to move your decision-making to the left on the timeline,” he said. “Every day that you don’t make a decision is really something that is going to drive costs up in your project or your opportunity.” That could mean locking in suppliers early—“that piece of pipe or all of that cable or that component”—before demand narrows availability or raises price, he advised.
Today, however, even an early commitment may not secure delivery, said Jeff Gulach of National Grid Ventures, who spent 36 years in EPC before moving into origination. “The supply chain is still broken. That’s the bad news. And it has been going on for six, seven years now,” he said. Gulach’s most recent 345-kV breaker came in on a four-year lead, and original equipment manufacturers (OEMs) and distributors have retreated from delivery guarantees once backed by liquidated damages. “I hear constantly, ‘My switches were supposed to be here eight and a half months ago, and they’re not here.’ You took your eyeball probably off of the production slot, and your [purchase order] allowed the distributor or the OEM to sell your production slot.” Many projects, he added, still lack the procurement staff needed to track those positions through delivery. “I still see 300-person engineering teams and 1,200 craft heading to a major project, and then I’ll see a three-person procurement team still boarding all the stuff to keep all those people busy. Those days are over.”
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Another shift in EPC work is the pull from two very different customer strategies. Entergy Louisiana, for its part, is pursuing repeatable designs to reduce execution risk. CEO Phillip May said the utility has roughly 26 turbines available to meet projected growth and plans to deploy them through a repeatable combined-cycle design. “We’re building the same CCCT [combined-cycle combustion turbine] over and over again,” May said. A crucial benefit of that approach is that it could give skilled craft “five, seven, 10 years of job certainty” across a fleet concentrated in one region, he said.
For hyperscalers, meanwhile, the schedule is fixed far earlier than the eventual load profile. Jason Altobelli, director of energy and infrastructure partnerships at Google, said the company is building data centers “two to three times, in some cases even more than that, than what we built even a couple of years ago,” under infrastructure commitments extending 20 to 30 years. “Our central problem is that we effectively designed 20- to 30-year agreements for facilities that are hosting products that don’t exist yet,” Altobelli said. “So, demand forecasting for those products is hard. The cone of uncertainty widens pretty dramatically five-plus years out. We don’t know what the utilization is going to be, we don’t know to what extent the chips will be optimized.”
Google’s approach is a “bifurcated energy strategy,” Altobelli explained. High-confidence load goes into regulated utility markets, while more flexible or expansion load goes into deregulated markets, such as in the Electric Reliability Council of Texas (ERCOT), where Google can accept lower take-or-pay commitments, add onsite generation and self-supply, and resell any underutilization on the wholesale market. “We’re going to preserve our optionality there,” he said.
Some hyperscale buyers, meanwhile, are going further, absorbing procurement and prefabrication that has historically belonged to EPC contractors or utilities. Travis Wright, vice president of energy and sustainability at QTS Data Centers, said QTS keeps roughly “$18 billion in materials ready for deployment to any one of our data centers,” building “the same 3-MW chunk over and over and over again” and stocking “utility-scale transformers, breakers, switches, things that we can actually supply to our utilities to get us online faster.” QTS also modularizes electrical rooms off site, part of a program that puts up 7 million square feet of data center in 18 months. But like in the power sector, quick builds magnify the labor problem. Some QTS campuses may require 5,000 workers for five years, Wright noted.
The Labor Long Pole
While the power sector has long anticipated a demographic squeeze in the skilled trades, labor has now evolved into the ultimate interruption, as Matt Pistner, president of NRG Wholesale, noted. “If you go back 12 months ago, all anyone wanted to talk about was, if you don’t have a turbine, you don’t have a power plant, and that’s true,” he said. NRG is building three plants in the Houston area—two peakers and a combined-cycle unit—backed by the Texas Energy Fund (Figure 1). Transformers and high-voltage switchgear have since emerged as additional constraints, Pistner said, but equipment alone does not produce a plant. “If you don’t have the labor to put the steel in the ground, it’s going to be a really expensive way,” he said. “You can just have an expensive inventory sitting there waiting for someone to show up.”
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1. NRG’s T.H. Wharton peaker plant expansion in Houston, Texas, came online at the end of May 2026, the merchant generator’s first new plant in a decade. Courtesy: NRG Energy |
The trouble is, as Pistner explained, 20% to 30% of NRG’s critical craft roles—including welders, electricians, other skilled trades—will be eligible to retire within five years. Nationally, roughly 450,000 high school graduates a year would need to enter the trades just to offset attrition, before the current buildout. However, turnover is also affecting quality. “The ability to keep a high standard on quality is getting tougher and tougher, and so we’re seeing a lot of rework, a lot of missed connections,” he said. “This knowledge transfer, what it takes to someone that’s kind of 30 to 35 years of experience and seeing it all, and now we have this new class of employees coming in, and how do we get that transfer down? It’s going to be a critical solution. We’ve got to figure out. We’re going to miss a material opportunity here.”
As Talha Faiz, cofounder of Candid Intelligence, a Seattle-based artificial intelligence (AI) firm compressing pre-construction engineering, argued, the labor crunch may be as much a workflow problem as a headcount one. Owners and EPCs need to preserve senior engineers’ judgment while giving younger engineers a way to reach that level without waiting 20 or 30 years, he said. “There has to be a mechanism for us to not just understand and capture the value from previous projects, but make sure that we deliver this to the next stage as well,” Faiz said. Otherwise, he warned, the squeeze will cascade into procurement, engineering, and construction.
From Bid to Partnership
Finally, the combined pressure of compressed schedules, unresolved supply-chain constraints, and uncertain load profiles is reshaping EPC contracts. Owners are now buying more of the plant directly than they historically did, said Zachry Group Senior Vice President and Power Market Executive Mike Kotara, who leads business development for power, nuclear, and data centers.
“In the past, they typically would buy the combustion turbines, maybe the steam turbine, typically leave the [heat] recovery steam generators, other equipment, balance of plant equipment for the EPCs. Now, what they’re having to do is go out and buy extended scope packages,” Kotara said. Equipment that remains in the EPC scope—including power distribution centers and air-cooled condensers—requires enough engineering definition that procurement often begins before the EPC contract is complete.
“You’re doing that under maybe a limited notice to proceed that allows you to buy equipment at risk, at the owner’s risk. Obviously, the EPC can’t take on that risk, so you have two things that are working against each other that have really turned the entire development process kind of on its ear,” he said.
Meanwhile, NRG Wholesale, like several other power companies, has moved to forge crucial partnerships. Last year, it established a 5.4-GW partnership with Kiewit built around GE Vernova turbines and a standardized EPC design intended for repeated use across projects. “I think we’ve moved from kind of transactional-based to partnership-based across almost the entire platform of what it takes to go from concept to electron,” Pistner said. “Doing it kind of one-off, transactional is going to be an incremental slowdown to your ability to get moved quickly.”
Chevron is also dividing work differently. The company has begun breaking single EPC scopes into multiple contracts, said Manish Misra, general manager of capital projects at Chevron. While that can make individual packages more manageable, it leaves the owner responsible for coordinating the interfaces among them.
“How can you take the risks out of the system and not just look for a supply chain partner or a business partner to trust those risks and try to get through that?” Misra said. Owners and contractors still need to answer for the work they control, he said, including safety, execution quality, and cost. “Safety, reliability, quality, and cost rise and fall together,” he said. “I’ve never been to a job site that is safe but not good, or vice versa.”
—Sonal C. Patel is a POWER senior editor (@sonalcpatel, @POWERmagazine).
