Operations and Maintenance Agreement


This template is an operations and maintenance agreement for utilities that establishes how the companies which respectively own and operate a power plant will interact after the plant becomes operational. It deals with costs, reporting, indemnification, insurance, and the possible default of either party. This template contains practical guidance, drafting notes, and an alternate clause. A power plant is a complex system that generally costs hundreds of millions or even billions of dollars to complete. Because of this, they are often owned by large publicly-traded entities. However, the owner may not operate the plant. Instead, it may bring in an operator that specializes in operating that particular type of plant on behalf of public utilities. An operations and maintenance agreement (O&M Agreement) is essentially a service supply contract between the owner and the operator. It specifies the responsibilities of the power plant's operator, and aims to mitigate operational risk by ...