The Federal Court’s decision in Rimfire Energy Pty Ltd v BSF Co Pty Ltd (No 2) [2025] FCA 384 (Rimfire) highlights the need for construction contracts, particularly in the renewable energy sector, to include clear extension of time (EOT) provisions and for contracting parties to strictly comply with those provisions.
While EOT disputes are familiar territory in traditional construction projects, Rimfire confirms that the same principles apply to renewable energy infrastructure. In fact, the stakes in the renewables sector may be even higher: delay can expose a party to significant liquidated damages, lost revenue under offtake arrangements and reputational damage, especially in projects tied to milestone-based funding or critical grid connection timelines.
In Rimfire, the parties entered into Power Purchase Agreements (PPAs) for the development of a solar farm and a gas-fired generator in the Northern Territory. Both projects encountered delays and the developers sought EOTs, claiming the delays were caused by a government-owned network provider.
The PPAs permitted EOTs for certain qualifying delay events, provided strict notice requirements were met. These included deadlines for submitting notices and the provision of detailed supporting information. The central issue was whether the developers had complied with these procedural obligations.
The Court found that the developers had not submitted valid EOT claims. They failed to provide the level of detail required under the PPAs to demonstrate that the delays were beyond their control. As a result, the EOT claims were rejected and the developers were held liable for liquidated damages.
The judgment reiterates a familiar contractual theme: when a contract prescribes specific steps and evidence for an EOT claim, strict compliance is essential. Failure to follow the required procedural steps precisely can result in the loss of EOT entitlements.
In particular, the PPAs required the developers to submit a written claim for an EOT within 10 business days after determining the full effects of the extension event. The Court interpreted this clause as creating a strict condition precedent. The use of the word “if” in the clause was construed to mean “only if”, with the result that unless the developers submitted a compliant EOT claim within the prescribed timeframe, they were not entitled to an EOT.
As outlined in A Contractor’s Guide to Risk Allocation in Construction Contracts for Renewable Energy Projects and detailed in Risks in Renewable Energy Subcontracts for Specific Subcontractors, renewable projects bring elevated and unique risks that are often absent or more manageable in traditional construction.
Renewable energy projects often involve:
Given these risks, contracts must clearly allocate responsibility for authority-related delays. If the contract is silent or ambiguous on who bears the risk of, for example, a utility company’s failure to deliver a grid connection, costly disputes are likely. Standard form contracts often fall short in dealing with renewable-specific risks such as access delays, planning uncertainty and connection approvals.
Rimfire illustrates the importance of ensuring that contracts not only contain clear and workable EOT mechanisms but also clarify:
The renewable energy context does not modify contractual principles or commercial risk allocation. If anything, the elevated risk heightens the need for clarity and strict adherence to EOT clauses in contracts.
Contractors should consider the following measures:
One of the most effective ways to mitigate the risk of non-compliance with EOT procedures is to appoint a dedicated, experienced contract administrator. In complex projects with multiple interfaces, overlapping obligations and tight deadlines, EOT entitlements can be lost simply because no one tracks them in real time.
A skilled administrator can monitor potential EOT events, ensure EOT notices are submitted with the necessary particulars and maintain compliance with strict timeframes. In this sense, contract administration is not just a back-office function, it is a frontline risk management role.
Equally critical is ensuring the administrator receives timely legal advice. Legal input can help interpret contractual requirements, resolve ambiguity in notice provisions and frame correspondence and notices to preserve entitlements. Together, commercial and legal oversight form the foundation of an effective risk mitigation strategy.
The Rimfire decision is not groundbreaking in its legal reasoning, but it is a powerful reminder that in high-stakes projects, especially in the renewables sector, contracts must be drafted clearly and administered with discipline. Failure to comply with notice provisions, even when delays are genuine, can result in the loss of valuable contractual entitlements and expose parties to significant liabilities.
This communication is sent by Kreisson Legal Pty Limited (ACN 113 986 824). This communication has been prepared for the general information of clients and professional associates of Kreisson Legal. You should not rely on the contents. It is not legal advice and should not be regarded as a substitute for legal advice. The contents may contain copyright.
tristan.cockman@kreisson.com.au
02 8239 6512
