Hogan Lovell OffshoreBook 2023 230809 OnlinePDF - Flipbook - Page 135
Offshore Wind Worldwide 2023
approvals identified in the Offshore Wind
Policy. The Offshore Wind Policy also indicates that the MNRE would come out with a
clear time schedule for approvals and clearances to facilitate developers — however, it
has not yet been issued. The framework set
out in the Offshore Wind Policy is that Stage
I approvals shall be obtained prior to the
notification of blocks for the ICB process.
However, post-allocation, developers would
have to pursue formal clearances from
the concerned authorities, although NIWE
would act as an overall coordination agency
to facilitate the process with respect to the
approvals identified in section 2.2 above.
The process for obtaining the approvals
differs based on the approval required and
the statute in terms of which such approval
is required. The approvals would be binding
on issuance but are valid only so long as
the conditions specified in such approvals
are being adhered to by the developer. ‘In
principle’ clearances would of course be
conditioned on the grant of final approvals
at the appropriate stage of the project. Certain approvals are granted with fixed validity
periods and would have to be renewed from
time to time while others are conditioned on
certain activities commencing or being completed within a specified timeframe, failing
which the approval would lapse.
2.4 Timeframe for the realization
of the project
As indicated in section 1.2 above, the Strategy Paper envisages broadly a timeframe of
4-5 years for the development of offshore
wind projects from the grant of concession.
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3. OFFTAKE ISSUES
3.1 Offtake, remuneration and
tariff scheme
While the template of the PPA for offshore
wind has not been released and India is at
this stage still in the process of tendering
the first project of this nature, note that
PPAs would typically be long-term tie ups
for the supply of power, and power producers would be able to recover a tariff for the
supplied power based on the tariff determined through the ICB process. In the event of
a shortfall in offtake, there would generally
be a scheme for generation compensation
in the PPAs. However, this would be subject
to certain exclusions such as grid security,
equipment, and personnel safety etc.
3.2 Consequences of a project delay
While the template of the PPA for offshore
wind has not been released and India is at
this stage still in the process of tendering the
first project of this nature, generally, PPAs
executed with government offtakers (such
as agencies of the Government or Government distribution utilities) provide for a levy
of liquidated damages on the developer
in case of project commissioning delays,
except for delays caused by offtaker-default
or force majeure conditions. Liquidated damages would also be levied in case certain
conditions/milestones are not met as per
the timelines prescribed in the PPA.
The offtaker would have the right to invoke
the performance security furnished by the
developer to the offtaker under the PPA to
realise any liquidated damages. If a delay
persists beyond a certain timeframe speci-
