The PV Standard Project Deeds contemplate that the carve outs to the exclusion of Project Co's liability for Indirect or Consequential Loss may include liability the State has to third parties (including for economic loss) not caused by damage (see clause 43.11(d)(ix) of the PV Standard Project Deeds). The clause should be carefully considered on a project specific basis, having regard to the likelihood of the risk of any such liability, the potential extent of that liability, the level of control Project Co has in respect of the risk that might give rise to such a liability and the insolvency risk that it creates for Project Co. The carve out, if it is used, should be limited to specified parties. It may also be appropriate to consider a cap on that liability. The State may also need to disclose the terms of its agreements with the relevant third party to Shortlisted Respondents during the RFP Phase so Project Co can make an informed assessment of its potential exposure.
The list of exceptions to the exclusion for Indirect or Consequential Loss may include additional project specific items to reflect relevant project specific payments or liabilities, for example where there are known Liabilities that the State has to third parties for loss of revenue that either need to be covered by Project Co or subject to a different regime. However, the circumstances for project specific amendment should be limited given the insolvency risk it creates for Project Co.