When Project Co replaces Equipment during the Operational Phase it must meet the standards specified in clause 29.2(c). Importantly, Project Co is required to ensure that the replacement Equipment is, at the time of replacement at the same standard as the Equipment it is replacing at the time the replaced Equipment was procured. For example, if the relevant Equipment was a state of the art computer monitor at Commercial Acceptance, its replacement must similarly be a state of the art computer monitor at the time of replacement. Replacement of the computer monitor with the same brand and model may not meet this requirement.
The State recognises that Project Co may not be able to price the cost of replacement Equipment that meets the required standard and accordingly will pay Project Co as a Change Compensation Event where it requires Project Co to procure replacement Equipment that has a Whole of Life Cost (as determined in accordance with clause 29.2 of the Project Deed) that exceeds the original Whole of Life Cost of that replaced Equipment by more than 10 per cent.