Quote:
Originally Posted by Delgar
Now you are just making things up.
The "Enron clause", a NDP-invented phrase they coined hoping it would help them with public perception, has blown up in their faces. There was no variation. It was merely a matter of clarification of interpretation of what had already been consulted upon.
In any event, the obligation to consult does not give any particular consultee a veto or ability to alter the wording of the agreement anyway. The government proceeded with the interpretation an independent panel agreed was the, get this, actual intention based on the prior consultations.
The wording below is exactly what it was, a mere interpretation issue which was agreed upon by the Independent Assessment Team as established in the process.
Query 8 PPA Section 4.3(j) – Unprofitability of the PPA Due to Change in Law
Clarification is required of the phrase “render continued performance by the Parties to this Arrangement for the balance of the Effective Term unprofitable to the Buyer in respect of a Unit…”
A literal interpretation of this clause could result in a Buyer being precluded from exercising its right to terminate the PPA pursuant to Section 4.3(j) because the Change in Law did not “render” the PPA “unprofitable” where the PPA was already “unprofitable” prior to the Change in Law.
It is proposed that Section 4.3(j) of the PPAs be clarified in a manner that makes it clear the Buyer shall be entitled to terminate the PPA and shall not be liable for, nor entitled to any Termination Payment if a Change in Law renders the PPA unprofitable, or more unprofitable.
Response:
The IAT has reviewed PPA Section 4.3(j) and confirms that the intention was to provide and (sic) exit provision with no right to or liability for a Termination Payment in the event that a Change of Law rendered a PPA unprofitable or more unprofitable. This intention would be made more clear in the PPAs with the insertion of the following (in bold italics) at S4.3(j) of the PPAs:
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This the crux of the entire argument though. As I understand it, the government argues that this "interpretation" is in fact a substantive change (just in the guise of an interpretation) and therefore the IAT exceeded its jurisdiction. So, question appears to be: where is the line between a minor interpretation and a substantive change (thus triggering the requirement for public consultation etc)?