Developer’s Future Cost Responsibility Clause Samples
The Developer’s Future Cost Responsibility clause assigns the obligation to the developer to cover certain costs that may arise after the initial completion of a project. Typically, this clause outlines which types of future expenses—such as maintenance, repairs, or upgrades—fall under the developer’s responsibility, and may specify timeframes or conditions under which these costs must be paid. By clearly defining who is accountable for future expenditures, this clause helps prevent disputes and ensures that ongoing financial obligations are properly allocated between the parties.
Developer’s Future Cost Responsibility. Once a Developer has accepted a Project Cost Allocation or Revised Project Cost Allocation, as the case may be, in the Final Decision Round and paid cash and posted Security or posted Security for that amount, then the accepted figure caps the Developer’s maximum potential responsibility for the cost of System Upgrade Facilities and System Deliverability Upgrades required for its Project, except as discussed below.
25.8.6.1 If the portion of the Highway System Deliverability Upgrades required to make the Developer’s generator or Class Year Transmission Project deliverable is less than 90% of the total size of the Highway System Deliverability Upgrade identified for the Developer’s Project, and the Developer elects to commit to pay for its proportionate share of the Highway System Deliverability Upgrade by posting Security instead of paying cash, then the Developer’s allocated cost of the Highway System Deliverability Upgrade will be increased during the period of construction deferral by application of a construction inflation adjustment, as discussed in Section 25.7.12.2 of these rules. When deferred construction of the Highway System Deliverability Upgrade commences, the Developer will be responsible for actual costs in excess of the secured amount only when the excess results from changes to the operating characteristics of the Developer’s Project. If the portion of the System Deliverability Upgrades for a Highway System Deliverability Upgrade required to make one or more generators or Class Year Transmission Projects in a Class Year deliverable is ninety percent (90%) or more of the total size (measured in MW) of the System Deliverability Upgrades, construction is not deferred, and those Developers will be responsible for actual costs in excess of the secured amount in accordance with the rules in Sections 25.8.6.2-25.8.6.4 of this Attachment S.
25.8.6.2 If the actual cost of the Developer’s share of required System Upgrade Facilities or System Deliverability Upgrades is less than the agreed-to and secured amount, the Developer is responsible only for the actual cost figure.
25.8.6.3 If the actual cost of the Developer’s share of required System Upgrade Facilities or System Deliverability Upgrades would be greater than the agreed-to and secured amount because other Projects have been expanded, accelerated, otherwise modified or terminated, including Transmission Projects evaluated pursuant to Attachment P to the OATT and their required upgrades, as ide...