What does it mean when a project reaches FID?
FID, final investment decision, is the moment a company's board commits the money to build. Before it, a project is a plan. After it, contracts get signed.
Large projects spend years in study. Engineers refine the design, the company secures permits, signs sales contracts and lines up loans. None of that obliges it to build. The obligation begins with the final investment decision.
At FID the board approves the full budget and the main construction contracts are awarded. For suppliers it is the date that matters, because orders for turbines, pipe and steel follow within months. For analysts it is the difference between capacity that is proposed and capacity that is coming.
Announcements can blur the line. A memorandum of understanding, a pre-FID engineering contract or a government press release are not the same thing. If the report does not say FID was taken, assume it has not been.
- Before FID
- Studies, permits, financing talks
- After FID
- Construction contracts and equipment orders
Explainers describe how things generally work. They are not advice for a specific project or country. See our editorial policy.