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Dispute Resolution Mechanism for solar/wind sector 

Topics covered:

  1. Government policies and interventions for development in various sectors and issues arising out of their design and implementation.

 

Dispute Resolution Mechanism for solar/wind sector 

 

What to study?

For prelims and mains: DRM- need, significance, composition and functions.

 

Context: In a major decision to facilitate the solar and wind energy projects, the government has approved a proposal to set up a Dispute Resolution Committee to consider the unforeseen disputes between solar/wind power developers and SECI/NTPC, beyond contractual agreement. 

Significance: The move will give further fillip to the smooth implementation of solar/wind energy projects in India. It fulfils a long pending demand of the industry to resolve expeditiously, unforeseen disputes that may arise beyond the scope of Contractual Agreements. 

 

Need:

  • The Solar and Wind Industry have been demanding setting up of Dispute Resolution Mechanism by MNRE for quite some time, to resolve expeditiously, unforeseen disputes that may arise beyond the scope of Contractual Agreements between solar power developers / wind power developers and SECI/ NTPC.
  • The issue was considered and it was felt that there is need to erect a transparent, unbiased Dispute Resolution Mechanism, consisting of an independent, transparent and unbiased Dispute Resolution Committee (DRC), for resolving the unforeseen disputes that may arise in implementation of contractual agreements and also for dealing with issues which are beyond the scope of Contractual Agreements between solar power developers/ wind power developers and SECI / NTPC.

 

Composition and eligibility:

  • A three member Dispute Resolution Committee (DRC) will be set up with the approval of Hon’ble Minister (NRE), consisting of eminent persons of impeccable integrity.
  • The upper age for the DRC members shall be 70 years.
  • The Committee members of DRC shall be chosen from the eminent persons located in NCR of Delhi so as to avoid expenditure on Air Travel & accommodation.

Scope:

The mechanism of Dispute Resolution Committee (DRC) will be applicable for all solar/ wind Schemes/ Programmes/ Projects being implemented through/ by SECI/ NTPC.

 

The DRC will consider following kinds of cases:

  • All cases of appeal against decisions given by SECI on Extension of Time requests based on terms of contract:
  • All requests of Extension of Time not covered under the terms of contract.
  • All such cases referred to it, including the cases where the developer is not satisfied with the decision of SECI/NTPC and it decides to appeal after paying the required fee.

 

Final decision:

The recommendations of the ‘Dispute Resolution Committee’ (DRC) along with MNRE’s observations, will be placed before Hon’ble Minister (NRE) for final decision. The Ministry shall examine and put up such recommendations to Minister (NRE) with the comments of IFD within twenty one (21) days of receipt of recommendation from the DRC.

To arrive at any decision, Committee will be free to interact with the relevant parties of the case and shall record their views. For presenting the case before the DRC, no lawyers shall be permitted.