What leads to photovoltaic power generation fails to perform

Polaris solar PV net news: first, an overview

Distributed in photovoltaic power generation energy-saving service agreement is signed during investment and business to business that may arise that we can’t fulfill the contract risk and responsibility very seriously, there are 5 main types:

(1) the enterprise liquidation

(2) force majeure, in particular, acts of expropriation, the Government

(3) accidents

(4) merger or Division

(5) the dissolution of a company

From an investment perspective, power station belonging to long-term investment, rely mainly on electricity investment efficiency of enterprises. Companies such as in the case, investment income would be seriously affected, removal and installation costs not only costly, but also bear the risk of investment could not be recovered. According to the power station construction project investment analysis, its costs for PV modules, inverters and other equipment, EPC costs, taxes and other costs. Equipment investment at about 56%-63%,EPC about 27%-31% and other expenses accounted for 6%-17%. Other expenses of space is very big, as the basic input of expenses and risk costs negligible. Depreciation life span of 25 years of PV modules, PV modules in the 25 years of continuous use, investors can move plant to continue operating. However, in the meantime, investors need to find a qualified installation platform in order to minimize the risk.

The 88th section of contract law: “party by the other party’s consent can be in your contract rights and obligations be transferred to a third party. “In General, if the plant is not damaged, and most economic way is under the contract, the transfer of the creditor’s rights and liabilities of the contract, by the new owners of factory premises instead of the original contract and becomes the new party privity of contract continues to perform the contract. If plant damage and enterprises have a new workshop provides new building demolition plant to reduce investment risk.

But if plant damage and not for the purpose of resettlement power station, this is most difficult to deal with shared responsibility between the two sides. In this case, the investor needs demolition plant, its losses for the demolition of labour costs and normal operation of the power station cannot be energy efficiency losses.

Second, situation analysis

1, business bankruptcy

Under the insolvency law, allows an insolvency administrator choose continue or terminate the contract. The bankruptcy law article 18th: “after the people’s Court has accepted a bankruptcy filing, the administrator was established prior to the bankruptcy filing debtor and the other parties have not fulfilled the contractual right to decide to lift and continue to perform, with notice to the other party. Manager since the bankruptcy filing is not within two months from the date of notification by the other party, or from the date of receipt of the notice of the other party does not reply within the 30th, considered terminating the contract. Management decides to continue performance of a contract, the other party shall perform the; however, the other party is entitled to require the administrator to provide security. Management does not provide guaranty, considered terminating the contract. ”

(1) to continue to implement

The 41st of the insolvency law: “the following debt occurs when a people’s Court has accepted a bankruptcy petition, for total liabilities: (a) the administrator or the debtor requests the other party to the contract are not fulfilled by both parties arising out of debt. ”

If managers choose to continue to perform the contract, the investor (creditor) claims is provided with dual protection, first of all, investors have the right to require the administrator to provide security, if not provided, considered terminating the contract and, secondly, after selection claims for the total of benefits claims, can priority of claim. This has occurred after the electricity necessary for the selection of creditor’s rights and liabilities arising out of, but without the electricity that is, whether the expected benefits of the project belongs to the common debts are worth exploring.

If the administrator chooses to continue to perform the contract, is not financially liable earnings have no accountability, debts arising from the continued performance of the contract is only for electricity. Of this contract as a long-term obligation, the normal time for far longer than the time consuming bankruptcy procedures, may contract at the conclusion of the bankruptcy proceedings have not been fulfilled, it will breach. If after the conclusion of the procedure is default, then the liability for breach of duty holders could not be found, and unfair for the creditor. So, for the contract are not fulfilled, there is a final performance. Distributed solar power contracts, which could not be fulfilled before the conclusion of the bankruptcy proceedings, in the case of bankruptcy is inevitable if there is a breach of the contract of a company, at which point it will have a default liability, expected benefits become debt as a loss.

In this case, the creditors and the administrator can actually foresee the inevitability of default. Minimize losses for creditors, while safeguarding the basic electricity needs of the debtor, the Manager chose to continue performance of a contract is the best way. Where you can do a technical processing, going bankrupt as they were during the total liabilities, other liabilities as debt.

(2) the termination of the contract

If administrators choose to terminate the contract, is judged to be corporate defaults should be liable. Under the bankruptcy law article 53rd: “administrator or the debtor, in accordance with the provisions of this law to terminate the contract, the other party for damages arising out of the termination of the contract the right to submit claims. “And the 97th of contract law:” termination of the contract, not yet performed, discharged; has executed, according to the performance and the nature of the contract, the parties may request restitution, take other remedial measures, and is entitled to claim damages. “The termination of the contract, either party may claim damages claim.

(3) the above

The 107th section of contract law: “where a party does not perform its contractual obligations or performance of a contract not in conformity with the Convention, should continue to perform, to take remedial action or compensation for breach of contract. “In summary, such as bankruptcy, it will eventually cause the creditor the right to damages, in addition to common debts electricity bills outside the priority of claim, other debt as debt to pay off.

But is generally distributed in photovoltaic power generation contract, investor it’s hard to claim that right. First, dissolution of contract loss is not caused by power stations and electricity, but investors expected returns as well as the cost of relocation and resettlement of hydropower station second, power belongs to the expendables, scheduled and the parties settled, unused power belongs to the expected return, is a creditor that has not occurred. The expected return is much higher than companies from this contract in the energy-saving benefits and utility can still be used after the reinstall. If sought compensation from the company expected returns, not only is unfair in itself, and negotiate the contract of enterprise does not take that risk.

2, force majeure

In accordance with the General principles of civil law article 153th: “force majeure is an unforeseeable, unavoidable and insurmountable circumstances. The “107th:” unable to perform the contract due to force majeure or causes damage to others, does not bear civil liability, unless otherwise provided by law. “The 29th article of the tort liability Act:” causes any damage due to force majeure, assume no liability. Otherwise provided for by law, in accordance with its provisions. ”

Force majeure, mainly government expropriation and other government actions, as well as earthquakes and other natural accidents. According to the law, force majeure subject to statutory exemptions, such as the contract cannot be fulfilled due to force majeure, is not responsible for breach of contract.

This provision is reasonable, behavior and seismic force majeure because the Government belongs to the unforeseeable, unavoidable and insurmountable circumstances, parties and non-subjective. And force majeure not only for Enterprise workshop, power plant, will lead the two sides are unable to perform the contract, thus exempting each other.

3, accident

Here mainly refers to accidents such as fire, although objectively caused harmful consequences, but rather than intent or negligence, but due to irresistible or unforeseeable causes. In this case, the enterprise’s own factories damaged, resulting in temporarily or completely unable to fulfill his contractual obligations.

Accidents are not required by law for the exemptions. First of all, for the power station and the attached buildings to take out public liability insurance and property insurance, at the time of the occurrence of the insured to seek indemnification. Second, to clarify the causes of the accident, General accident both in fault-free, but accidents happen for a certain reason, this reason due to which side the responsibility borne by the parties.

In the accident, such as building damage, power station is not immune, investor losses of power plant assets and the expected return, belongs to the category of tort liability. 7th of the tort liability Act: “Act infringe civil rights, regardless of the perpetrator has no fault, the law shall bear tort liability, in accordance with its provisions. ”

As the responsible party for the enterprise, Enterprise on accident while no-fault, but serious damage to investors ‘ property rights, and the behaviour of enterprises (due to business reasons accidents) have a direct causal relationship with the property damage, and no other grounds for exemption, so you need to bear tort liability, and compensation. But is not subjective enterprise, you can reduce their responsibilities accordingly, only compensation for investment projects (mainly plant asset).

If plant damage but the station was not damaged and unable to continue performance of the contract, the right to plea for investors, may rescind the contract and demand compensation.

4, business combination or separation

In accordance with the General principles of civil law in article 44th of the 2nd paragraph: “enterprise legal person is divided or merged, its rights and obligations assumed by the legal persons and changes. “The contract law 90th section:” after the conclusion of the contract by the parties, resulting from the combination of the legal persons or other organizations to exercise a contractual right, to perform its contractual obligations. Separation after conclusion of the contract by the parties, except as otherwise agreed by the creditor and debtor, by separate legal persons or other organizations on contractual rights and obligations joint and several creditors and assume joint and several liability. “The company law article 75th:” when the companies merged, the creditor’s rights and debts of the merging parties, and should be made by the surviving company after the merger or new company inherited. “77th:” before the corporate division of debt resulting from the Division of the company bear joint and several liability. However, in the Division of the company before creditors reach a written agreement on debt settlement except as otherwise agreed. ”

Under the law, regardless of the enterprise is a merger or a division of legal persons were subject to change, but does not affect the validity of the contract and the rights and obligations of the account.

5, the company disbanded

Company law 181th article: “company for following reasons dissolved: (a) company articles provides of business term expires or company articles provides of other dissolved causes appeared; (ii) shareholders will or shareholders Assembly resolution dissolved; (three) for company merged or Division need dissolved; (four) law was revoked license, and ordered close or was revoked; (five) Court in accordance with this method 183th article of provides be dissolved. “The 183th:” serious difficulties in the management of the company, and continues to exist will make substantial losses to shareholders, cannot be resolved through other channels, all over 10% of the voting shareholders of the company, he may request the Court to dissolve the company. ”

In the dissolution, merger, separation and dissolution of the bankruptcy of the company discussed in this article has been, the remaining grounds for dissolution occurs fails to perform, belong to the enterprise unilaterally breach, and there are no exemptions, shall be liable for breach of contract. Set up a group result of the disbandment, creditors began to submit claims. If the company’s assets to pay off debt, according to the contract; if it is not enough to pay off debts, could enter bankruptcy proceedings, is guided by the relevant provisions of bankruptcy law be dealt with according to the first case.

However, enterprises generally unwilling to take on this responsibility. The 187th company law: “… … Pay off debt after the remaining assets of the company, a limited liability company in accordance with the shareholders ‘ capital contribution proportion of limited distribution in accordance with the proportion of shares held by the shareholders. “In short, greater corporate debt risk, shareholders may be allocated to the remaining property, the less direct impact on shareholder benefits.

Third, the conclusions

Combined above discussion, above 2nd, and 3 species belongs to perform cannot, 1th, and 5 species belongs to expected default, are belongs to legal provides of default behavior, will led to contract of lifted or terminated, so contract lifted or terminated Hou of responsibility how distribution, is investors need focus consider of a problem, is contract in the a items very important of terms, and enterprise of default responsibility is is contract negotiations in the of heavy in the of heavy. (In this case need to distinguish between the termination of the contract or the termination of liability and liability for breach of, if the rescission or termination of the contract was the result of friendly consultations by the parties, can be construed as a change and there is no liability for breach of and after the companies liable for breach of contract may also may continue to perform).

Adopted the principle of strict liability in civil law, the 107th section of contract law: “where a party does not perform its contractual obligations or performance of a contract not in conformity with the Convention, should continue to perform, to take remedial action or compensation for breach of contract. “That is, regardless of the party has no fault, as long as its default behavior, and no exemption shall bear corresponding liability for breach of, and exemptions only for cases of force majeure and the creditor’s fault. Therefore, the 1th, 3, 5 kinds of the defaulting party has to take responsibility and pay for the damage. If there are relevant provisions in the contract, the applicable contract or assign responsibility in accordance with the relevant provisions of law, mainly as compensation for losses, namely, removing artificial costs energy efficiency losses and normal operation of the power station cannot.

General energy efficiency losses are difficult to calculate, in practice, formulas that can be liquidated, and stipulate that the maximum compensation, and compensation for loss control within the range acceptable to the parties. Considering the project benefits, these risk factors are quantified as indicators, converted to cost in order to calculate the project rate of return and payback period as a whole, to determine the scope of contract risk.

Original title: what leads to photovoltaic power generation fails to perform?

Posted in Solar Charger.