Hogan Lovell OffshoreBook 2023 230809 OnlinePDF - Flipbook - Page 161
Offshore Wind Worldwide 2023
4. GRID AND
GRID CONNECTION
Planning and construction is currently the
responsibility of the utilities.
4.1 Responsibility for the cost of the grid
connection system
In addition to the utility companies, business operators will incur a certain amount of
construction costs to connect their power
generation facilities to the onshore grid. The
exact amount will vary depending on the utility in question.
4.2 Consequences of delays and disruptions of the grid connection system
As a general rule, there is typically no protection for the wind farm owner. However, this
will be decided on a case-by-case basis as it
ultimately depends on the terms of the grid
connection agreement.
4.3 Onshore grid congestions, prioritisation of renewable energy resources and
compensation mechanisms
Under the Enforcement Regulations for the
FIT Act (METI Ordinance No. 46, 2012, as
amended) (the Enforcement Regulations), if
the amount of electricity provided is expected to exceed demand, and notwithstanding
that the Purchaser may have taken remedial
steps set out in Article 14.1(8) i of the Enforcement Regulations (including curtailment
of its own power generation facilities or
frequency adjustments), the Seller must comply with the curtailment instructions from
the Purchaser as set out in Article 14.1(8) i.
The curtailment instructions are no longer
subject to any time limitation. The Seller
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cannot seek compensation for any damages
resulting from curtailment provided that the
Purchaser has (without delay) informed the
Seller in writing of the justifications and mitigating steps after issuing the instructions.
The Purchaser may also curtail the output of
the power facility if items (1) (natural disaster
causes) or (2) (human safety reasons) under
Article 14.1 (8) ho of the Enforcement Regulations apply to the Purchaser and the cause
or reason is not attributable to the Purchaser.
The Seller cannot seek compensation from
the Purchaser for damages resulting from
the curtailment if the Purchaser has shown
reasonable cause for the curtailment.
The Seller must curtail output at the power facility following the instructions of the
Purchaser if item (1) or (2) under Article 14.1
(8) he of the Enforcement Regulations applies
to the Seller. If the Purchaser so instructs the
Seller and the Purchaser has shown reasonable cause for the curtailment, the Seller cannot seek compensation from the Purchaser
for damages resulting from the curtailment.
Other than in the above scenarios, the Seller
can seek compensation from the Purchaser
for damages incurred as a result of curtailment by the Purchaser or curtailment by
the Seller at the Purchaser’s instruction.
The compensation amount is calculated by
multiplying the unit price of electricity by the
acknowledged amount of electricity that the
Seller would have provided to the Purchaser
but for the Purchaser’s curtailment, unless
the curtailment was due to unforeseeable
special circumstances or due to causes
attributable to the Purchaser.
