How do PPA and EPC differ in terms of investment?

PPA is 0 THB investment — the provider (e.g., CapSolar) funds everything and bills monthly based on actual usage. EPC requires a turnkey CAPEX of roughly 25-40M THB per MWp; the customer owns the system outright with no electricity payment but pays for O&M separately. More at What is PPA.

PPA or EPC — which is more cost-effective over 25 years?

EPC saves ~25-35% more than PPA over 25 years (e.g., 500 kWp: EPC total cost ~21M vs PPA ~28M), but EPC requires 18-20M upfront. On an NPV basis with an 8% discount rate the gap narrows significantly — for businesses with high cost of capital (WACC > 10%), PPA can actually win on NPV. Run your own numbers.

Can factories in leased premises do PPA or EPC?

Both are possible with conditions — PPA works if the lease has ≥ 15 years remaining and the landlord co-signs (tri-party structure). EPC works if the lease is ≥ 20 years, but there's a risk the tenant can't relocate the system if they move out mid-contract. We usually recommend PPA for its flexibility.

Does PPA have hidden costs?

CapSolar's PPA has no material hidden costs — PPA rate × kWh is the only payment. Industry watchpoints: (1) escalators above 3%/year, (2) unclear early-termination fees, (3) performance guarantees that don't cover system underperformance, (4) transfer clauses when the building is sold. Review these 4 clauses carefully before signing any PPA.

Does EPC require in-house operations? Is it labor-intensive?

Not heavy — a 1-5 MWp system needs only ~10-15 days/year of preventive maintenance (panel cleaning, inverter inspection, re-torque). Most customers sign an O&M contract with CapSolar or a third party at 1,500-3,000 THB/kWp/year. No full-time headcount required. Projects > 5 MWp may justify one dedicated employee.

Can BOI apply to EPC or PPA?

Under EPC the customer claims BOI directly — 3-8 year CIT exemption (by activity type) + import duty exemption on solar equipment (panels/inverters), reducing effective CAPEX by 10-15%. Under PPA the provider (not the customer) claims BOI, so benefits don't flow to the customer directly — providers usually pass them through as a lower PPA rate. Try the BOI eligibility checker.

Who owns the PPA system at end of contract?

It depends on the contract terms. Typically 3 options: (1) customer buys the system at residual value (usually 1-10% of new cost), (2) renew the PPA for another 5-10 years at a new rate, (3) have CapSolar decommission and restore the roof to original condition. Most customers choose option 1 because the system still has 5-10 years of low-cost production.

Does EPC have financing options?

Yes — most Thai banks (Krungsri, SCB, KBank, Bangkok Bank) offer green loans for solar projects at 4.5-6.5%/year, 7-10 year tenor, up to 80% LTV on CAPEX. EXIM Bank and ADB Green Bond programs are available for projects > 5 MWp. Combining a loan + BOI typically lifts project IRR 3-5 percentage points above pure equity.

Solar Knowledge

PPA vs EPC Which Model Fits Your Business?

Compare Solar PPA and EPC across 12 dimensions — investment, ROI, risk, BOI, cash flow, ownership — with a 2-minute decision tree to guide your choice.

12-dimension comparisonDecision treeFree calculator

Try the PPA vs EPC Calculator Talk to Our Engineer

8 min read

PPA vs EPC — A Short Definition

PPA (Power Purchase Agreement) is a contract where the solar provider funds the entire installation; the customer pays only for electricity at 10-30% below grid rates. EPC (Engineering, Procurement, Construction) is when the customer funds and owns the system outright — turnkey delivery, 4-7 year payback, and 100% savings thereafter.

Pricing Model Deep-Dive — PPA vs EPC

PPA — Pay-As-You-Use (opex)

Under PPA, the provider (e.g., CapSolar) funds the entire installation and bills the customer for each kWh the system actually produces. Rates typically fall between 2.50-3.20 THB/kWh (25-40% below PEA/MEA TOU peak) with a 1-3% annual escalator. Monthly bills are measured via a dedicated export meter separate from the grid meter. Customers typically have a buyout option between years 7-10, depending on contract structure.

EPC — One-Time Capex, 100% Ownership

Under EPC, the customer pays a turnkey CAPEX of roughly 25-40M THB per MWp (varies by roof structure, panel brand, MDB distance, BOI status). Payment is usually structured as milestones: 30% upfront + 40% on delivery + 30% at COD. It covers engineering design, procurement (panels, inverters, mounting, cabling, monitoring), installation, ERC/PEA/MEA permitting, and grid interconnection. Post-handover O&M is not included — most customers sign a separate O&M contract at 1,500-3,000 THB/kWp/year.

Example: 500 kWp system over 25 years

PPA: Total electricity cost over 25 years ~28M THB (zero CAPEX, 25% avg savings vs PEA)
EPC: CAPEX 18M THB + 25-year O&M ~3M THB = 21M THB total (saves ~7M vs PPA but requires 18M cash upfront)

Note: Figures are 2026 CapSolar estimates (actual size, load profile, PPA rate, and Ft may vary). Run your own scenario at the PPA vs Self-investment Calculator.

Risk Allocation — Who Bears What Under Each Model

The biggest difference between PPA and EPC isn't just the money — it's who bears risk across each dimension. The table below summarizes 8 major risk types and the responsible party under each model.

Risk Type	PPA — Who Bears	EPC — Who Bears
Performance (underproduction)	Provider	Customer
Equipment failure (panel/inverter)	Provider	Customer (under warranty or post-warranty)
Tariff rise (PEA/MEA increase)	Customer benefits (PPA locked lower)	Customer benefits (100% savings)
Tariff drop (PEA/MEA decrease)	Customer at risk (PPA rate locked)	Customer at risk (payback extends)
BOI / tax incentive	Provider claims (customer cannot use CIT/import duty)	Customer claims directly (CIT exemption + duty-free imports)
Property (roof leaks, damage)	Provider (performance + insurance included)	Customer (must buy insurance separately)
Tech obsolescence	Provider (usually refreshes inverter mid-contract)	Customer (inverter lasts 10-12 yrs, self-funded replacement)
Counterparty (provider insolvency)	Customer at risk (review financial stability + step-in rights)	N/A after handover (only warranty claims remain)

Cash Flow & Accounting Impact

PPA — Opex-friendly

PPA expenses are booked as opex (electricity cost), not as a balance-sheet asset. There's no depreciation to compute and no impact on debt capacity — suitable for companies that want to preserve a clean balance sheet for banking covenants or ROE metrics. Accounting is straightforward: monthly electricity fee × 25 years, as paid. No asset componentization required.

EPC — Capex + Depreciation + BOI

EPC costs are capitalized as PP&E and depreciated over 10-20 years (IAS 16 / Thai GAAP — most use 20-year straight-line). BOI Section 30/31 offers 3-8 year CIT exemption + import duty exemption on panels/inverters, reducing effective CAPEX by 10-15%. If loan-financed, interest is booked separately as finance cost. Check BOI eligibility with our free tool.

IFRS 16 & Thai GAAP — Watchpoints

Under IFRS 16 (fully effective in Thailand since 2020), PPA contracts with "controlled use of identified assets" may be classified as a lease, requiring right-of-use asset + lease liability capitalization. Most CapSolar on-site rooftop PPAs are structured as service contracts (pay-for-output), which is not a lease under IFRS 16 §9 — but your auditor should review the contract before signing.

Case Scenarios — Which Businesses Fit PPA vs EPC

The 3 hypothetical cases below reflect the customer archetypes CapSolar commonly sees in Thailand — not any specific client. Figures are approximations.

Hypothetical Case 01

Case A — SME Factory, 200K THB/month electricity bill

Auto-parts factory, 2,000 sqm rooftop, 200K THB/month electricity bill (~2.4M/year). The owner doesn't want to deploy cash because they're expanding production lines. Recommended system size: 150 kWp. **Recommendation: PPA** — zero investment, immediate ~25% savings = 600K/year × 15 years = 9M THB without impacting working capital.

Pick PPARun your own numbers

Hypothetical Case 02

Case B — Large Factory Group, 5M THB/month bill + BOI

Electronics group with 3 factories in EEC, already holds BOI Section 30 (0% CIT for 8 years). Total electricity bill 5M/month = 60M/year. The finance team has CAPEX budget and wants maximum ROI. Combined system size: 3 MWp. **Recommendation: EPC** — CAPEX ~90M THB (~75M net of BOI), payback ~4 years, then 100% savings = 20M/year × 21 remaining years = 420M THB. Plus duty-free imports on panels/inverters.

Pick EPCRun your own numbers

Hypothetical Case 03

Case C — Retail Mall, 10-year Roof Lease (tri-party PPA)

Retail mall leases the building from a landlord with 10 years remaining on the lease. Electricity bill 1M/month. The tenant cannot deploy CAPEX because they don't own the building. System size: 500 kWp. **Recommendation: tri-party PPA** — landlord co-signs with tenant and CapSolar. Contract term matches the lease (10 years) + a clause to transfer the PPA to the new tenant or landlord if the current tenant moves out. Savings ~250K/month = 30M over 10 years.

Pick PPA (tri-party)Run your own numbers

See CapSolar's real project track record on the projects page.

PPA vs EPC Comparison Table (12 dimensions)

Dimension	PPA	EPC
Upfront investment	0 THB	25-40M THB/MWp
System ownership	CapSolar (15-25 yrs)	Customer 100%
O&M responsibility	Included (CapSolar)	Customer (or separate O&M contract)
Electricity savings	10-30% from day 1	100% after payback
Payback period	N/A (no investment)	4-7 years
Contract term	15-25 years	Panels 25 yrs / inverter 10-12 yrs
Best fit for	Cutting opex, fast ESG, no-capex	Max long-term ROI, CAPEX budget, BOI
Performance risk holder	CapSolar	Customer
Balance-sheet impact	None (opex)	Recorded as asset + depreciation
BOI / tax incentive	Provider claims	Customer claims direct (CIT + import duty)
End-of-contract options	Buy residual / renew / decommission	Already owned
Time-to-savings	Day 1 at COD (10-30% immediately)	Day 1, but 100% savings only after 4-7 year payback

See our Solar PPA service · See our EPC service

Decision Tree — 5 Questions to Pick PPA or EPC

Answer 5 sequential questions and get a recommendation for your business in 2 minutes.

Ready to find your answer in 2 minutes? Click to start 5 questions.

Want a detailed scenario? Try the PPA vs Self-investment comparator.

Summary — When to Pick PPA vs EPC

Pick PPA when

You want to avoid large cash outlays (opex-friendly)
You want to save on electricity from day one
You don't have a facility/engineering team for O&M
Lease has < 15 years remaining (need tri-party)
You want zero balance-sheet impact + clean debt capacity

Pick EPC when

You have CAPEX budget + 4-7 year ROI is acceptable
You want 100% savings after payback (max ROI)
You hold BOI / tax benefits that can use CIT/import duty
You own the building or have ≥ 15-year lease
You have a facility/engineering team + want performance control

Authored and Reviewed by the CapSolar Team

This article was written by CapSolar's engineering and financial advisory team and reviewed by our Chief Engineer and Finance Director. Our team develops and operates 16.5 MWp across 8 EPC and PPA projects in Thailand, covering PPA contract negotiation, BOI privilege usage, ERC/PEA/MEA compliance, and long-term O&M.

Written by: Frank Lin (CEO, CapSolar) · Reviewed by: Chief Engineer, CapSolar · Published: April 23, 2026 · Last updated: April 23, 2026

Frequently Asked Questions

Still deciding between PPA and EPC?

Let CapSolar engineers analyze your actual data (electricity bills + roof + budget) and recommend the best-fit model — free, no strings attached.

Get a Free Consultation PPA vs Self-investment Calculator