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					</table><p>The Ministry of New &amp; Renewable Energy (<a href="https://mnre.gov.in/" target="_blank" rel="noopener">MNRE</a>) has established a dispute resolution mechanism to handle unforeseen disputes between renewable energy power developers/EPC (engineering, procurement, and construction) contractors and implementing agencies.</p>
<p>The revised mechanism prioritizes transparency, impartiality, and independence by forming a three-member Dispute Resolution Committee (DRC) comprising individuals with impeccable integrity.</p>
<p>It will specifically consider cases related to time extensions due to recognized &#8216;force majeure&#8217; events, unforeseen circumstances not covered by contractual agreements, and disputes unrelated to time extensions.</p>
<p>In case of all disputes, whether or not covered by agreements or contracts, the application must be made first to the renewable energy implementing agency (REIA). REIA would pass speaking orders on such requests to ensure the renewable projects are set up. If the applicant party is not satisfied with the orders of REIA, it can appeal to the DRC.</p>
<p>To initiate an appeal against a decision made by the REIA, developers/EPC contractors must submit an application along with a prescribed fee. The fee structure varies depending on the type of dispute and the presence of a performance bank guarantee. In cases where the appeal is successful, the collected fee will be refunded if recommended by the DRC and approved by the government.</p>
<p>The DRC can convene meetings with a minimum of two members.</p>
<p>The DRC will review referred cases and provide recommendations to the MNRE within 21 days. The MNRE, in consultation with the Integrated Finance Division, will review the recommendations and make a final decision within 21 days of receiving them.</p>
<p>The dispute resolution mechanism will also extend to power purchase agreements between state/union territory governments/entities and developers, provided they agree to bear the DRC&#8217;s sitting fees and associated expenses.</p>
<p>The procedural guidelines for the Dispute Resolution Mechanism are as follows:</p>
<ul>
<li>The DRC will convene at least once every week, provided there are pending cases/applications to be resolved. The Secretary (DRC) of the REIA will ensure that DRC meetings are scheduled in a manner and frequency that adheres to the 21-day decision period.</li>
<li>In cases where the DRC cannot decide within the 21-day timeframe, the Secretary (DRC) appointed by the REIA will inform MNRE and may request an additional 14 days for the DRC to decide.</li>
<li>The DRC will be free to interact with relevant parties involved in the case and record their views. The presentation of the case before the DRC will not include lawyers. The REIA can present their views and arguments on the applicant&#8217;s pleas. If necessary, the DRC may interact with MNRE, with the MNRE&#8217;s Division handling the Dispute Resolution Mechanism acting as the ministry&#8217;s nodal point.</li>
<li>As per the ORM/DRC Order issued by MNRE, if the developers/EPC contractors wish to appeal the REIA&#8217;s Order, they must do so within 21 days of the REIA&#8217;s Order. Any adverse financial impact resulting from the REIA&#8217;s Order should be put on hold for 21 days after its issuance. If an appeal is not filed within 21 days or is rejected due to insufficient fee payment, the REIA may take appropriate action. No coercive action should be taken on cases brought before the DRC until the final disposal of the appeal by the DRC and MNRE, where applicable.</li>
<li>In cases falling under the DRM/DRC Order issued by MNRE, which pertains to disputes between entities under States and Union Territories and renewable developers, the role of the nodal agency will be assumed by the Secretary (DRC), SECI.</li>
</ul>
<p>Last March, the Ministry of Power <a href="https://www.mercomindia.com/power-project-conciliation-committees" target="_blank" rel="noopener">introduced</a> a conciliation mechanism for settling contractual disputes regarding power projects implemented by central public sector undertakings and developers under the administrative control of the ministry.</p>
<p>Subscribe to Mercom&#8217;s real-time <a href="https://mercomindia.com/product/mercoms-renewable-energy-regulatory-updates/" target="_blank" rel="noopener">Regulatory Updates </a>to ensure you don&#8217;t miss any critical updates from the renewable industry.</p>


MNRE Sets Up Mechanism to Settle Disputes Beyond Scope of Agreements

<p>The Indian <a href="https://mercomindia.com/land-impediment-large-scale-solar/" target="_blank" rel="noopener noreferrer">solar</a> market has grown from a 3 GW installed capacity in 2014 to 35 GW in 2019. With the rapid expansion of solar and wind sectors, the disputes involving the stakeholders have also increased.</p>
<p>In <a href="https://mercomindia.com/mnre-dispute-resolution-solar-wind/" target="_blank" rel="noopener noreferrer">June 2019</a>, the Ministry of New and Renewable Energy had issued an order to establish a system to resolve disputes between solar and wind energy developers and the Solar Energy Corporation of India (SECI) or the National Thermal Power Corporation (NTPC) which are the government’s implementing agencies. The MNRE has now issued procedural guidelines for the dispute resolution mechanism (DRM) which will be applicable to projects being implemented through SECl or NTPC.</p>
<p>According to the guidelines, SECI and NTPC will provide a secretariat for the dispute resolution committee (DRC), with its head being designated as the secretary from SECI or NTPC.</p>
<p>SECl and NTPC are expected to provide designated personnel, not below the rank of general manager, who will function as the secretary of the DRC. All the applications under the DRM, whether for appeal against the decisions given by SECI or NTPC based on the terms of contract or the requests not covering under the terms of contract, will be addressed to the secretary of the DRC.</p>
<p>All applications of dispute would be addressed to the DRC secretary at SECl or NTPC with copies sent to MNRE&#8217;s division dealing with the DRM. In an amendment to the guidelines, the ministry has mandated that developers should reach out to SECI or NTPC first before submitting the application to the committee. In case the developers directly approach the committee, their application will get rejected.</p>
<p>The DRC is expected to hold hearings on the applications and submit its recommendations to the MNRE within 21 days. It will also be expected to meet weekly to discuss the pending cases. In case the DRC is unable to give its decision within the time frame of 21 days, the secretary must inform the MNRE which may then provide an additional 14 days for the DRC to make a decision.</p>
<p>The MNRE also issued an amendment allowing a developer to appeal to the DRC against the SECl or NTPC&#8217;s order within 21 days. Moreover, any negative financial implication on the developer due to SECI or NTPC’s order should be put in abeyance for 21 days after the order.</p>
<p>All expenses of the DRM or relating to these guidelines, including the expenses related to the DRC and the secretariat, will be paid by SECl or NTPC. Besides these, the MNRE has also issued amendments to the guidelines regarding force majeure, extension of time, and fees related to this mechanism.</p>
<p>Setting up a mechanism for disputes between developers and intermediary power procurers such as SECI or NTPC is expected to boost confidence among investors in the renewable energy sector in India.</p>
<p><a href="https://mercomindia.com/mnre-release-bank-guarantee-solar-wind/" target="_blank" rel="noopener noreferrer">Recently</a>, the MNRE, through a letter, has directed NTPC and SECI to release performance bank guarantee for the solar and wind power projects that have been commissioned.  According to the letter PBGs may be released within 45 days from COD (Commercial Operation Date), subject to fulfillment of requirements of submission of all the requisite documents. Further, MNRE also mentioned that in case any developer finds delays in release of PBGs, it should be brought to the notice of the MNRE and the managing director of the concerned intermediary procurer.</p>


MNRE Issues Blueprint for Dispute Resolution Committee for Solar & Wind Projects

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