Engineering procurement and construction contract
Engineering, procurement, and construction (EPC) contracts, sometimes called turnkey contracts are similar to design and build contracts, in that there is a single contract for the design and construction of the project, but generally with an EPC contract, the client has less say over the design of the project and the contractor takes more risk.
On a design and build project, the client may produce an outline design upon which tenders are sought. On an EPC project, the client may seek tenders based on a performance specification and then have no input into the design, other than if variations are instructed.
Payment can be on a lump sum, cost reimbursable basis, or some other basis, but generally the client would be likely to seek a fixed price, lump sum agreement where the responsibility for cost control is taken by the contractor. This gives the client a relatively risk-free arrangement, with one point of responsibility and cost certainty. They can therefore operate the contract with the minimum resource.
The clients main risk lies in the definition of the specification upon which the contract is based. If the specification is not well developed and concise otherwise the quality and performance of the completed development may be compromised (see performance specification and output-based specification for more information)
Generally, EPC contracts are used on engineering and infrastructure projects, or industrial projects, where the aesthetics of design might be considered less important to the client than performance and cost certainty.
The FIDIC Conditions of Contract for EPC Turnkey Projects (The Silver Book) is an example of an engineering procurement and construction contract.
[edit] Related articles on Designing Buildings
- Construction contract.
- Contract conditions.
- EPCM contract.
- FIDIC.
- Output-based specification.
- Performance specification.
- Procurement route.
- Procurement team.
- Reliance data in EPC contracts.
- What is an EPC contract?
[edit] External references
- Skills Funding Agency: Procurement routes.
- CABE: Procurement routes.
- PACE Guidance on the Appointment of Contractors and Consultants for a detailed analysis of the pros and cons of various procurement routes.
- nbs: National Construction Contracts and Law Survey 2012.
Featured articles and news
Building Safety recap January, 2026
What we missed at the end of last year, and at the start of this...
National Apprenticeship Week 2026, 9-15 Feb
Shining a light on the positive impacts for businesses, their apprentices and the wider economy alike.
Applications and benefits of acoustic flooring
From commercial to retail.
From solid to sprung and ribbed to raised.
Strengthening industry collaboration in Hong Kong
Hong Kong Institute of Construction and The Chartered Institute of Building sign Memorandum of Understanding.
A detailed description fron the experts at Cornish Lime.
IHBC planning for growth with corporate plan development
Grow with the Institute by volunteering and CP25 consultation.
Connecting ambition and action for designers and specifiers.
Electrical skills gap deepens as apprenticeship starts fall despite surging demand says ECA.
Built environment bodies deepen joint action on EDI
B.E.Inclusive initiative agree next phase of joint equity, diversity and inclusion (EDI) action plan.
Recognising culture as key to sustainable economic growth
Creative UK Provocation paper: Culture as Growth Infrastructure.
Futurebuild and UK Construction Week London Unite
Creating the UK’s Built Environment Super Event and over 25 other key partnerships.
Welsh and Scottish 2026 elections
Manifestos for the built environment for upcoming same May day elections.
Advancing BIM education with a competency framework
“We don’t need people who can just draw in 3D. We need people who can think in data.”
Guidance notes to prepare for April ERA changes
From the Electrical Contractors' Association Employee Relations team.
Significant changes to be seen from the new ERA in 2026 and 2027, starting on 6 April 2026.
First aid in the modern workplace with St John Ambulance.
Solar panels, pitched roofs and risk of fire spread
60% increase in solar panel fires prompts tests and installation warnings.
Modernising heat networks with Heat interface unit
Why HIUs hold the key to efficiency upgrades.