Hyundai E&C has planted its first energy flag on the vast plains of Texas in the United States of America. The company has successfully secured a contract for the 'LUCY Project,' a monumental undertaking to build a 350MWac (455MWdc) large-scale solar power plant on a site four times the size of Seoul’s Yeouido district, equivalent to over 1,600 soccer fields. This is a mega-project that will generate 926 GWh of electricity annually for 35 years, supplying it to global RE100 companies like Starbucks, Workday and etc. Behind this historic first step lies the untold story of seamless collaboration between the Overseas Investment Team and the New & Renewable Energy Business Team. We bring you to the behind-the-scenes story of the LUCY Project's success through an interview with both teams.

Hyundai E&C’s First Foray into the U.S. Energy Market,

A Large-Scale Solar Project Rolling Out in Texas

Q. First and foremost, sincere congratulations on securing the project. I'm curious about the reactions you’ve received.

Overseas Investment Team: Thank you. I still vividly recall the moment the financial closing* was confirmed at 10 AM on July 10th. When the news of our success hit the press that afternoon, we were flooded with congratulations. The vibe within the company was electric, filled with a sense of pride: "Hyundai E&C has truly made its mark on the U.S. energy market now!" Externally, a wave of positive feedback rolled in, with remarks like, "Hyundai E&C has finally taken its first major step as a global developer."

New & Renewable Energy Business Team: This contract was especially meaningful for our team, as it was our first new and renewable energy project overseas. After the news broke, all our team members felt a profound and genuine sense of pride for the first time in a long while. Not only did we receive congratulations from colleagues across the company, but a wide range of partner firms and financial institutions also expressed a sense of hope and a strong desire to collaborate on our international expansion.

* Financial closing is the final stage in financing a large-scale investment project where all conditions precedent to the disbursement of funds by financial institutions are met, and the actual loan and investment capital are released.

Q. Could you please tell us about the Texas LUCY Solar Power Project, a collaborative achievement by 'Team Korea'?

Overseas Investment Team: The LUCY Project is a large-scale venture to build and operate a 350MWac (455MWdc) solar power plant in Concho County, in western Texas. It will be developed on a site approximately four times the size of Yeouido, equivalent to about 1,653 soccer fields, and is slated to generate and sell approximately 926 GWh of electricity annually for 35 years after completion. This capacity is sufficient to power about 260,000 four-person households using an average of 300 kWh per month. The generated power is contracted to be sold to numerous global corporations, including Starbucks and Workday, through a Virtual Power Purchase Agreement (VPPA). Hyundai E&C, together with private and public enterprises and policy funds such as Korea Midland Power, Korean Overseas Infrastructure & Urban Development Corporation (KIND), EIP Asset Management, and the PIS Fund, formed 'Team Korea' to successfully enter the U.S. energy market. From the early development stages, Hyundai E&C handled equity investment, technical reviews, and the supply of solar modules. Construction is being carried out by the local services firm Primoris, with operations managed by Korea Midland Power.

New & Renewable Energy Business Team: As mentioned, the Overseas Investment Team is leading the project with the overarching goals of equity investment and enhancing profitability, while our team, the New & Renewable Energy Business Team, is responsible for the solar module supply within the Engineering, Procurement, and Construction (EPC) scope of the LUCY Project. Our primary role is to systematically procure and supply the modules needed to ensure the 455MWdc capacity. While it may seem like simple procurement effort, solar modules represent a significant portion of the power plant's cost and are a critical material directly tied to its performance. As a result, our team devoted exceptional effort to meticulously vetting multiple candidate manufacturers to select an optimal supplier offering both superior performance and reliability.

Overseas Investment Team: This project is particularly significant as it marks Hyundai E&C's entry into the U.S. energy market as a construction investor. A member of our team is scheduled to join the U.S. Special Purpose Company (SPC) at the end of this year and will oversee the entire project's milestones through to completion.

New & Renewable Energy Business Team: Exactly. The project is significant because it's the first time Hyundai E&C has moved beyond its traditional focus on overseas government contracts to solidify its position in the global project financing market. In a vast and complex market like the U.S., we successfully brokered a deal that required persuading numerous stakeholders. This was also the first instance where we led the entire process—from designing the contract structure itself, rather than adhering to a predetermined turnkey subcontractor agreement, to risk management and supply chain oversight. Notably, during development, we obtained and analyzed technical and permit data from the original developer and technical review materials from financial institutions. We also plan to secure a wealth of data during the upcoming construction phase. This experience will serve as an invaluable foundation for our future, full-scale entry into the local EPC market. 

A Mega-Project Forged 

Through Three Years of Preparation and Meticulous Negotiation 

Q. It sounds like a great many things happened along the way to securing this project.

Overseas Investment Team: We officially dove into this project after first learning about it in October 2022. Subsequently, in August 2023, we signed a fund investment agreement and a project rights acquisition agreement to invest directly, marking the start of full-scale development. By May 2024, we had completed all the various permits and due diligence required for interconnection with the local power grid. It took longer than anticipated to reach financial closing, but all related processes were finalized in July, securing both capital and loans. With the advance payment for the modules our company is supplying also received, we can now move forward with the project in earnest.

New & Renewable Energy Business Team: After the main technical and commercial conditions were finalized in May 2024, it took considerably longer than expected to reach the final contract and financial closing. In the interim, we faced numerous challenges, including cost escalations due to changes in the external environment and a request from the project owner for a price reduction to secure profitability. Nevertheless, through persistent negotiations with the owner and suppliers, we managed to minimize cost increases. Fortunately, financial closing has now been successfully completed, and we too have duly received the advance payment for our module supply contract.

Q. What was the most memorable moment in the process of closing the deal?

Overseas Investment Team: For me, the most memorable moment has got to be passing the internal final investment decision process. Since the LUCY project is the company's first overseas investment development venture, we had to undergo three exceptionally rigorous and in-depth investment reviews. Our team prepared and reviewed materials from every angle to advance the project, while several related departments, by necessity, took a cautious and conservative approach, leading to very intense deliberations. In the end, I believe it was all possible because we were united in the common goal of expanding the company's business portfolio and making our mark on the U.S. energy market.

New & Renewable Energy Business Team: Above all, the moment when the final contract was confirmed stands out the most. Starting with internal approvals, we went through a lengthy process of coordinating with numerous stakeholders, including the project owner, the lenders, and our suppliers. It was far from easy, but I felt a profound sense of accomplishment when we were finally able to steer the contract in the direction our company had envisioned. There were many difficulties in finalizing the language used in the contract, stemming not only from price negotiations but also from external issues, yet the pride of that moment when we found common ground with all parties and finally signed the agreement remains unforgettable.

Q. What was the biggest challenge during the acquisition process, and how did you overcome it?

Overseas Investment Team: As mentioned earlier, even after passing the final investment review, the most difficult aspect was having to undergo re-evaluation because the local market conditions and project terms changed multiple times. In 2023, for example, the lead time for key equipment such as transformers and circuit breakers doubled, and the financial structure deviated from our expectations. This created the significant burden of having to recruit tax equity investors after financial closing. We shared these risks transparently with related departments and discussed diverse scenarios, including a potential project sale, to find the optimal solution. Ultimately, we successfully passed the re-evaluation and were able to proceed to construction.

New & Renewable Energy Business Team: That's right. Uncertainty was particularly high right up to the final negotiation stage because, while the final contract was being delayed, the U.S. tariff policy on AD/CVD* was constantly shifting. We invested significant effort to obtain multiple tariff-related confirmations from the manufacturer to allay concerns about project delays. It was also a valuable experience to meet directly with the manufacturer's senior management, share Hyundai E&C's vision for our solar business, and thereby strengthen our long-term partnership.

* Anti-Dumping duty (AD) / Countervailing Duty (CVD): Trade regulation tariffs applied to imported products in the U.S.

A Strategic Synergy Forged 

by Combining Diverse Realms of Expertise

Q. The synergy between the two teams seems to be the most remarkable aspect of the LUCY Project.

Overseas Investment Team: This collaboration was the first time our two teams had joined forces. We each had distinct missions: the Overseas Investment Team aimed for equity investment and overall profitability enhancement, while the New & Renewable Energy Business Team focused on maximizing profit from the module supply and construction aspects. At times, our differing objectives could have led to conflict. However, we cooperated closely for the ultimate success of the project. While clearly delineating our respective roles and responsibilities, we actively shared information where necessary and successfully generated an optimal outcome together.

New & Renewable Energy Business Team: It's true that coordination was challenging at first due to our different roles and objectives. There were areas where our opinions conflicted, but we always sought a win-win solution for the benefit of Hyundai E&C as a whole. Thanks to the Overseas Investment Team's proactive efforts in persuading the SPC and legal advisors, our perspectives were also largely incorporated. The combination of our teams' expertise, especially in structuring the contract and during the final negotiations, was what ultimately enabled us to achieve the most satisfactory result.

Q. What did you prioritize most during the collaboration?

Overseas Investment Team: Our highest priority was to protect the profitability of each team. Since our interests could diverge depending on the situation, rather than indiscriminately sharing all information, we focused on clearly distinguishing between areas that required close collaboration and those that each team needed to manage independently. By aligning in this meticulous manner, we were able to simultaneously consider the benefits and risks as an investor alongside the benefits and risks as a module supplier. As a result, I believe we were able to achieve the best possible outcomes for the company as a whole.

New & Renewable Energy Business Team: I completely agree with the opinion of the Overseas Investment Team. In addition to that, a key focus for us was striking a balance between technical stability and commercial profitability. This wasn't about supplying the cheapest modules; for a project with a 35-year operational lifespan, it was crucial to generate meaningful profit while providing high-quality modules that guarantee stable long-term performance. Therefore, the fact that both teams respected each other's perspective and experience and remained committed to coordination and communication until the very end was, I think, our greatest strength.

[ AI-generated image of the U.S. Texas LUCY Solar Power Project site ]

Q. The project has now entered the construction phase. Could you share the remaining timeline and any future plans?

Overseas Investment Team: Currently, with advance payments disbursed for each EPC role, equipment procurement and capital contributions are underway. The site is scheduled to officially open next January. The solar modules supplied by Hyundai E&C are planned for delivery over approximately five months, from June to October next year, and we are preparing seamlessly toward our completion target in 2027.

Upon successful completion, we expect this project to become a landmark case study, marking Hyundai E&C's first overseas investment development project and establishing a firm foothold in the U.S. energy market. By signing VPPA contracts with global corporations, we will also set a precedent for cooperation with RE100 member firms. In the long term, this will allow us to expand into new growth opportunities as a player with genuine development abilities and assets in the U.S. market.

New & Renewable Energy Business Team: For the remainder of the project, we plan to concentrate on managing the delivery schedule and module quality. We will collaborate with our supplier and conduct site visits to their local factory to directly inspect the performance of the modules. We will also meticulously monitor external variables such as U.S. tariff policy (AD/CVD), strictly adhere to our defensive principles as the seller defined in the contract, and fulfill our responsibilities through close communication with both the client and the manufacturer until the very end. We anticipate that with the project's completion, Hyundai E&C will be able to demonstrate its substantive capabilities in the global solar project financing arena. Additionally, based on the experience gained from this overseas investment, we intend to lay the groundwork for expanding into full-scale EPC projects and diversifying across various renewable energy sectors in the future.