FID - for those who need a better understanding of the next step for EPP10 May 2026 07:40
Morning all, some great press coverage over the weekend regarding the approval of the licence.
I thought I would just post a better understanding of the next step (FID) as we shouldn’t assume that all investors necessarily know exactly what FID is. I hope this helps, I found this online and gives a good summary.
“ A company must secure a Final Investment Decision (FID) after being awarded a license because a license grants permission to operate, while the FID represents the formal commitment of capital required to actually build and execute the project.Securing a licence is a major regulatory milestone, but it does not guarantee that a project is financially viable or that the company has the funds to proceed.Here is why securing a FID is necessary after a license award:Financial Commitment & Risk Mitigation: The FID is the point where project stakeholders (investors, board members) officially authorize the release of billions of dollars for construction. It follows rigorous feasibility studies, engineering, and design (FEED) to ensure the project is profitable.Transition from Planning to Execution: A license allows the project to exist legally, but the FID transitions the project from the planning phase to the execution phase, allowing contracts for construction and procurement to be signed.Validation of Economics: The FID process forces companies to stress-test project economics against market conditions, ensuring the project can deliver returns.Conditions of the Licence: Often, the license itself is conditional upon reaching FID within a certain timeframe to ensure that companies do not hoard licenses without developing the projects.Example: In the case of energy storage projects (like those for [EnergyPathways]), a license allows the company to develop the project, but the FID is the subsequent step required to initiate the actual construction, typically with partners, aiming for a targeted operational start date.In summary, the licence award allows the company to move forward, but the FID provides the necessary financial, technical, and commercial certainty to actually build “