National Highways Authority of India (Ministry of Road Transport and Highways, Government of India) A-5 wa 6, BHET-0, aTeRT, AE Reh 110 075 © G-5 & 6, Sector-10, Dwarke, New Delhi-110075 ‘FEAN/Phone : 91-11-25074100 / 25074200 area uss usart of reer (aoe oRaer she user sare, ree ace) oy NHAI/Policy Guidelines/ Standard Document/ 2024 Policy Circular No.11.55/ 2024 dated 28 March, 2024 {Decision taken on E-Office File No. NHAI/Electricity/ Charges/CMD/2023-24 (Comp. No.-237635)} Sub: Regarding bearing the cost of energy consumption charges of the Project Highway Lighting works during the Maintenance/ Defect Liability Period of an EPC Contract.- reg. M/s. NKC - CDS (JV) vide their letter No. NKC-CDS/HO/Obd-Itarsi/2023-24/421 dated 02.01.2024 submitted that they are not liable to bear the cost of electricity charges for maintaining the Project Highway Lighting during the maintenance and defect liability period of the contract pertaining to the project ‘Balance work of Four Laning of Obedullaganj to Itarsi Section of NH-69 from Km. 2.800 to Km. 8.300 and from Km. 20.700 to Km. 63.000 (Design Length 46.3(km.) in the State of Madhya Pradesh on EPC Mode’. Brief of the issue as submitted by the Contractor is as under: (i) Provisional Completion Certificate and Completion Certificate have been issued in the subject project on 08.11.2021 and 08.12.2021 respectively. (ii) Article 14 and 17, do not make the Contractor liable to bear Energy Consumption Charges for Project Highway Lighting during the Maintenance Period/DLP. However, the Authority insists on the Contractor covering Energy Consumption Charges post- project completion, citing IRC:SP:84-2014, Section 12 in Schedule-C. (iii) Provisions contained in IRC SP:84-2014 forms a part of Schedule-C whereas obligations of the Contractor during Maintenance Period/ DLP are governed by Article 14 and 17 of the Contract Agreement. In accordance with Article 1.4.2 (b), provisions of Article 14 and 17 take priority over the provisions of IRC:SP:84-2014. (iv) Provisions of Schedule-E is the specific obligation of the Contractor during the ‘Maintenance Period as per Article 14, whereas the Schedule-C specifies the obligation of the Contractor only for the construction of project facilities. Schedule-E is more relevant towards the instant issue of Contractor's obligations regarding highway lighting works during Maintenance Period, as compared to the provisions of IRC-SP- 84:2014, forming part of Schedule-C and therefore, the provisions of Schedule-E shall prevail over Schedule-C. 2. __ The aforesaid issue was examined and the matter was discussed in EC Meeting held on 30.01.2024 vide Agenda Item No. 600.19. Relevant Clauses pertaining to the Issue as submitted by the Contractor are attached at Annexure 1. 3. It may be mentioned that Clause 14.1 (ii)(b) - ‘Maintenance obligations of the Contractor’ has been modified in Standard EPC Agreement issued by MORTH on 05.03.2019 w.r.t. the provision contained in old EPC Agreements as under: Contd...2/-[Clause No. Provision as per Standard EPC Agreement issued by MoRTH on 28.11.2018 and agreements prior to it Provision as per Standard EPC Agreement issued by MoRTH on 05.03.2019 (iio) [Clause 14.1 Undertaking routine maintenance including prompt repairs of potholes, cracks, joints, drains, embankments, structures, pavement markings, lighting, road signs and other traffic control devices. Undertaking routine _ maintenance including prompt repairs of potholes, cracks, joints, drains, embankments, structures, pavement markings, lighting, road signs and other traffic control devices. For the avoidance of the doubt, the electricity charges for operation. of electrical infrastructure installed along the project length, _except__the infrastructure being used by the Contractor for its own use, shall be borne by the Authority. 4. From Para 3 above, it is clear that for EPC Contracts entered after 05.03.2019, electricity charges for operation of electrical infrastructure is in the scope of Authority. However, there is no such provision regarding bearing of electricity charges by the Authority in the Standard EPC Agreements issued by MORTH prior to 05.03.2019. 5. __ In view of above, the matter was discussed in 600" Meeting of EC vide Agenda item No. 600.19. EC observed that the scope of lighting is specified in Schedule-C which inter- alia refers that Highway Lighting shall be provided as per Schedule-D (IRC:SP:84-2014). By this proviso, the specific provision of Schedule-D [Clause 12.3.1 (iii) of IRC:SP:84-2014] becomes part of scope of work under Schedule-C. Further, Clause 12.3.1 (ii) specifies that the Concessionaire shall bear all costs of procurement, installation, running and operation cost of all lighting, including cost of energy consumption specified in this Section. In view of this, it has been decided that Energy Consumption Charges for Highway Lighting are to be borne by the Contractor for the projects where contract provisions are similar to the provisions of project mentioned above. 6. This issues with the approval of Competent Authority. Encl.: As stated above adosy (Sanjay Kumar Patel) General Manager (Coord.) To: All Officers of NHAI HQ/ ROs/ PIUs/ CMUs/ Site Offices Copy to: 1. Hindi Division for translation in Hindi. 2. Library for hosting the circular on library site. 3. Web Admin for circulation.Annexure 4 Relevant Clauses of the Contract Agreement for the project ‘Balance work of Four Laning of Obedullaganj to Itarsi Section of NH-69 from Km. 2.800 to Km. 8.300 and from Km. 20.700 to Km. 63.000 (Design Length 46.3(km.) in the State of Madhya Pradesh on EPC Mode’ pertaining to the Issue of bearing the cost of energy consumption charges of the Project Highway Lighting works during the Maintenance/ Defect Liability Period. i. Article 12.4.3 states that ‘Without prejudice to the Obligations of the Contractor specified in Articles 14 and 17, the property and ownership of all the completed Works forming part of the Project Highway shall vest in the Authority’ ii, Article 14.1 stipulates the Maintenance Obligations of the Contractor during the Maintenance Period for a period of 4 years commencing from the date of Provisional Certificate of the Project. iii, Article 14.1.2 (b) stipulates that during the Maintenance Period the obligations of the Contractor shall include "undertaking routine maintenance including prompt repairs of potholes, cracks, joints, drains, embankments, structures, pavement markings, lighting, road signs and other traffic control devices.” iv. Article 14.2 - "The Contractor shall ensure and procure that at all times during the Maintenance Period, the Project Highway conforms to the maintenance requirements set forth in Schedule-E,” v. Schedule-E, Clause 2 - ‘Repair/Rectification of Defects and Deficiencies’ states that “The obligations of the Contractor in respect of Maintenance Requirements shall include repair and rectification of the Defects and deficiencies specified in Annex-1 of this Schedule-E within the time limit set forth therein.” vi. Annexure-I of Schedule-E states that "the Contractor shall repair and rectify the Defects and deficiencies specified in this Annex-| of Schedule-E within the time limit set forth in the table below” vii. SI (d) of the Annexure-I of Schedule-E provides following time limit for repair/ rectification in respect of road lighting: (d) Road lighting (i) Any major failure of the system - 24 Hours (ii) Faults and minor failures - 8 Hours viii. Article 17.2 - ‘Remedying Defects’ - "Save and except as provided in Clause 14.1.2, the Contractor shall repair or rectify all Defects and deficiencies observed by the Authority's Engineer during the Defects Liability Period within a period of 15 fifteen) days from the date of notice issued by the Authority's Engineer in this behalf, or within such reasonable period as may be determined by the Authority's Engineer at the request of the Contractor, in accordance with Good Industry Practice.” ix. Clause 2.9 (Il) - ‘Highway Lighting’ of Schedule C - ‘Lighting shall be provided at the following locations: a) Lighting shall be provided at approach to bridges, Built up areas, Toll plaza, Bus bays, truck Lay byes, rest area, major junctions, VUP & Flyover as per Schedule D (IRC:SP:84-2014)" x. Clause 12.3.1 (iii) of IRC SP:84-2014 stipulates that ‘ The Concessionaire shall bear all costs of procurement, installation, running and operation cost of all lighting, including cost of energy consumption specified in this Section’