Power Purchase Agreement from Commercial and Legal Perspective

Courses Syllabus

Welcome to “Power Purchase Agreement from Commercial and Legal Perspective,” proudly offered by BMC Training! Dive into a world where commercial acumen meets legal expertise, and equip yourself with the comprehensive knowledge and skills needed to expertly navigate PPAs. Our tailored curriculum, crafted by seasoned professionals, ensures that you'll emerge with a robust understanding of both the commercial and legal intricacies of energy contracts. Join BMC Training to elevate your professional acumen, making strategic, informed decisions in the complex energy landscape with confidence and precision.

Objectives:

• Understand the essential elements of a ppa and the underlying laws and regulations
• Mitigate the common risks in a power purchase agreement through careful considerations of the commercial and legal aspects of an energy project
• Strategize all stages of the ppa namely the negotiation, execution and implementation
• Develop effective negotiation skills to obtain the best advantage in a power purchase agreement
• Learn the key issues faced during project lifecycle and how to tackle these through enforceable contractual clauses
• Be aware of critical issues which could affect the critical aspects of the power generation project
• Manage the stakeholder relationships
• Participate effectively in the resolution of claims and disputes

At the end of this training course, you will learn to

• Analyze the structure of the power purchase agreement document and the terms of a power purchase agreement
• Understand the commercial and legal issues relating to the negotiation and execution of a ppa
• Know the different types of power purchase agreements used for implementing power projects
• Apply effective strategies negotiation, execution and implementation of a ppa
• Understand the various considerations in adopting risk management measures and the allocation and limitation of liability between sellers and buyers of energy
• How to negotiate an effective power purchase agreement encompassing all the critical issues faced upon instances of delayed scheduled, cost overruns, substandard quality, pricing volatility, and many more real-life problem scenarios

Outlines:

Day One: Power Purchase Agreement – Introduction & Main  Features

• Introduction to Energy Industry and the role of the Power Purchase Agreement
• Profile of the Project – Parties
• Different Project Structures & Business Models – Lease, License, Concession, BOT, BOO, BOOT
• Special Purchase Vehicle (SPV) Purpose and Role
• Generator Covenants
• Assignments Rights
• Licences
• Metering, Measurement and Verification
• Indemnifications
• Purchaser Covenants
• Price and Payment
• Avoided Peak Demand Payments
• Liquidated Damages

Day Two: Essential Clauses in a Power Purchase Agreement

• Term and Extension
• Performance Guarantees
• SPV’s Construction & Development Obligations
• Contracted Capacity & Energy
• Representations & Warranties
• Insurances Required
• Maintenance and Scheduled Outages
• Commissioning and Commercial Operations Commencement
• Early Termination Rights & Events of Default
• Off-taker Step-in Rights
• Force Majeure Provisions
• Disclaimers and Limitations of Liability & Indemnification
• Subsidies
• Change in Law
• Transfer of Ownership Rights, Assignments, Novations
• Law & Jurisdiction

Day Three: Risk Assessment in a Power Purchase Agreement

• Liquidated Damages – Delay and Performance
• Performance Bonds
• Retentions
• Variation Orders and Cost Overruns
• Dealing with Political Risk
• Dealing with Currency Exposures
• Minimum & Maximum Delivery Obligations
• Buyer Default
• Seller Default
• Sovereign Risk
• Change in Tax Law

Day Four: Commercial Aspects of a Power Purchase Agreement

• Price, Volume & Tariffs
• Metering
• Take or Pay Obligations
• Shape or Profile Risk
• Balancing Risk
• Credit Risk
• Tenor Risk
• Managing Lender Expectations

Day Five: Negotiation of a Power Purchase Agreement & Dispute Resolutions in PPA

• Negotiate the Best Power Purchase Agreement
  • Prepare a Term Sheet
  • Set Framework for Negotiations
  • Balance Buyer’s and Seller’s Needs
  • Know your BATNA
  • Focus on Interests not Positions
  • Reach Sustainable  Agreement
• Negotiation
  • Negotiate on Key Milestones to be Achieved & Penalties for Failures
  • Negotiate Performance Guarantees
• Dispute Resolution
  • Different Types of Dispute Resolution
  • Litigation
  • Mediation
  • Arbitration
  • Expert Determination