The Joint Power Generation Committee met at LMA Meeting Room 1, with broad market representation. The meeting was conducted in strict compliance with competition law, ensuring no discussion of prohibited subjects such as pricing or confidential terms.
Key Topics & Discussion Themes
- Obsolescence Clause
No updates were reported; members are arranging further discussion, focusing on how to address unknown closure dates. Additional wording from Munich was considered.
- SMB Fees and Market Practice
The Committee discussed the impact of upfront engineering fees and client awareness, noting some fees have doubled year-on-year. Members debated whether reclassifying fees as ‘costs’ could help address the issue, but acknowledged resistance is difficult in current market conditions.
- Market Issues – Members discussed
- Electrical trip at a Minnesota (US) utility
- USD 19m loss at a Mexican plant
- Site visit challenges in Israel, including Haifa port
- USD 33m H Class loss in Connecticut, with extended BI due to rotor lead time expected
- Hot works loss in Israel with significant BI exposure advised to the market
- Boiler explosion at a modern coal plant (USD 50–100m estimate)
- Progress on a utility repowering project
- Concerns over power risk classification as property
- Brazil’s tax rate increase from 0.3% to 3.5%
- Renewable Energy Update
The Committee was briefed on occurrence definition challenges, major flooding in Tennessee affecting solar, clause amendments without notification, and the increasing use of series loss and defect wording in property sections
