Agenda packet — Ava Community Energy Board of Directors, July 16, 2025

Board of Directors Meeting
Wednesday, July 16, 2025
6:00 pm
In Person:

Large Conference Room
Rotunda Building
300 Frank H. Ogawa Plaza
Oakland CA 94612
Or from the following locations:
• Clipper Club - 5 Captain Dr. Emeryville, CA 94608
• Best Western Plus LA Mid Town Hotel - 603 S New Hampshire Ave, Los Angeles, CA, 90005
• 35653 Scarborough Dr. Newark CA 94560
• 1100 Webster St Oakland CA 94607
• Larch Clover Community Center - 11157 West Larch Road, Tracy, CA 95376 Via Zoom:
https://avaenergy-org.zoom.us/j/87023071843
Or join by phone:

Dial(for higher quality, dial a number based on your current location): US: +1 669 900 6833 or +1 346 248 7799 or +1 253 215 8782 or +1 929 205 6099 or +1 301 715 8592 or 888 475 4499 (Toll Free) or 877 853 5257 (Toll Free)
Webinar ID: 870 2307 1843
Meetings are accessible to people with disabilities. Individuals who need special assistance or a disability-related modification or accommodation to participate in this meeting, or who have a disability and wish to request an alternative format for the meeting materials, should contact the Clerk of the Board at least 2 working days before the meeting at (510) 906- 0491 or [email protected].

If you have anything that you wish to be distributed to the Board of Directors, please email it to the clerk by 5:00 pm the day prior to the meeting.

1. Welcome & Roll Call
Ava Community Energy
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2. Pledge of Allegiance

3. Public Comment
This item is reserved for persons wishing to address the Board on any Ava-related matters that are not otherwise on this meeting agenda. Public comments on matters listed on the agenda shall be heard at the time the matter is called. As with all public comment, members of the public who wish to address the Board are customarily limited to two minutes per speaker and must complete an electronic speaker slip. The Board Chair may increase or decrease the time allotted to each speaker.

CONSENT AGENDA

4. Approval of Minutes from June 18, 2025

5. Contracts Entered Into (Informational Item)

6. Sunrun Load Modification Agreement Amendment
Amendment to the Sunrun Resilient Home Load Modification Agreement

7. Roots/Soul Sponsorship Agreement
Sponsorship contract for 2026/2027 seasons of Oakland Roots and Soul

8. Updated Energy Risk Management Policy
Updated Energy Risk Management Policy to ensure consistency and accuracy with the ERM Regulations

9. FY 2025 Q4 Treasurer’s Report
Update on Ava’s FY 2025 Q4 cash position

10.FY 2024-2025 Q3 Financial Statements
Ava’s third quarter financial statements for the fiscal year 2024-2025

REGULAR AGENDA

11.CEO Report

12.CAC Report

13.Compliance Period Procurement Methodology (Action Item) Review of proposed compliance periods for Ava procurement

14.Rate Stabilization Policy and Allocation (Informational Item) Overview of Rate Stabilization Funds (RSF), Ava’s current RSF balances, and preliminary considerations for surplus allocation and policy updates.

Ava Community Energy
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15.Sonrisa Power Purchase Agreement and Scarlet III Energy Storage Agreement (Action Item)
Approval to authorize the CEO to negotiate and execute PPA and ESAs for solar and storage with EDPR-affiliated entities

16.Chair/Vice-Chair Appointments

17.Board Member and Staff Announcements including requests to place items on future Board of Directors Meeting Agendas

18.Adjourn
The next Ava Board of Directors meeting will be held on Wednesday, September 17, 2025 at 6pm.

Rotunda Access Instructions
300 Frank H. Ogawa Plaza, Oakland, CA 94612
Directions
Directions to Parking Garage via Car
Parking is available at the Rotunda Garage, which includes four levels and approximately 350 parking spaces. Note that the garage’s parking fee is $4/hr with a maximum of $28 for a full day. Street parking is widely available near the building and free after 6pm.

There are two garage entrances located on 524 16th St (main entrance) and 529 17th St. See a map on the next page and note that both 16th and 17th are one-way streets on either side of the garage. 524 16th St (main entrance):

Turn right from Telegraph onto 16th Street and drive
pass SP+ Parking. Look for the entrance with Rotunda
Parking Lot signage—this is a surface lot with garage
access. Enter the garage and park your vehicle. Take
the elevator or stairs in the garage to the first floor in order to enter through the Rotunda’s 16th street
entrance on the second floor.

After parking, walk across 16th Street toward Telegraph Avenue (also called Peter Van Kleef Way).
529 17th St (one-way street entrance):

Enter the garage via the 17th Street entrance. Once
parked, take the elevator or stairs to the 1st floor of the garage. Exit the garage and walk toward 16th Street
(south direction). You will be walking along Telegraph
Avenue, which borders the Rotunda Building.

As you approach the corner of 16th Street and
Telegraph Avenue (also known as Peter Van Kleef Way),
the Rotunda’s main pedestrian entrance will be on your
left at 524 16th Street.

Enter through the second-floor glass doors, which lead into the main lobby of the Rotunda Building. From there, check in with security and proceed as directed to the meeting rooms on the lower level.

Directions via BART
The closest BART station to the Rotunda Building is 12th Street / Oakland City Center. From there, it’s approximately a 3-minute walk to the building. When exiting the station, use the 14th Street / Ogawa Plaza exit and head towards Frank H. Ogawa Plaza. The Rotunda Building will be in view from the plaza.

Directions via Bike
Cyclists may enter through the main building lobby at the lower level to access bicycle parking. Upon arrival, please check in with the building security desk, and you will be provided with directions to the designated indoor bike parking area.

Check-in at Security Desk
When you arrive at the building, please check in
with the security desk for directions to the Large
Conference Room, where the public meeting will be
held. For closed session, please head to the medium
conference room, both located next to each other
on the lower level. If you have additional questions
or need assistance, an Ava representative will be
stationed and identifiable in the lobby. They can be
reached at: 510-393-0492.

Restrooms
Restrooms are located on the lower level, near both
conference rooms.

Draft Minutes
Board of Directors Meeting
Wednesday, June 18, 2025
6:00 pm
In Person:

Conference Room 5
Ava Community Energy
1999 Harrison St
Suite 2300
Oakland CA 94612
Or from the following locations:
• Milk and Honey Cafe, 34265 Fremont Blvd, Fremont, CA 94555 • 35653 Scarborough Dr. Newark CA 94560
• 1100 Webster St Oakland CA 94607
• Larch Clover Community Center - 11157 West Larch Road, Tracy, CA 95376 • Tampa Marriott Water Street, 505 Water Street, Tampa, FL 33602 • JW Marriott - 510 Water St, Tampa, FL 33602
• 1755 Harvest Landing Ln., Tracy, CA 95376
Via Zoom:
https://avaenergy-org.zoom.us/j/87023071843
Or join by phone:

Ava Community Energy
Board of Directors Page | 2
If you have anything that you wish to be distributed to the Board of Directors, please email it to the clerk by 5:00 pm the day prior to the meeting.

1. Welcome & Roll Call

Present: Members: Marquez (Alameda County), Tregub (Berkeley), Morada (Dublin), Kaur (Emeryville), Roche (Hayward), Del Catancio (Newark), Rickman (San Joaquin County), Gonzalez (San Leandro), Nygard (Tracy), Sakakihara (Union City), CAC Vice-Chair Souza (Community Advisory Committee), Vice-Chair Andersen (Piedmont) and Chair Balch (Pleasanton)
Not Present: Members: Lopez (Albany), Keng (Fremont), Diallo (Lathrop), Barrientos (Livermore), Brown (Oakland) and Fugazi (Stockton)

2. (7:12) Pledge of Allegiance
Vice-Chair Andersen led the body in reciting the Pledge of Allegiance.

3. (7:33) Public Comment
This item is reserved for persons wishing to address the Board on any Ava-related matters that are not otherwise on this meeting agenda. Public comments on matters listed on the agenda shall be heard at the time the matter is called. As with all public comment, members of the public who wish to address the Board are customarily limited to two minutes per speaker and must complete an electronic speaker slip. The Board Chair may increase or decrease the time allotted to each speaker.

There were no speakers for public comment.

REGULAR AGENDA

4. (8:58) CEO Report
At the July 2025 board meeting, CEO Howard Chang gave an informational report covering recent updates on agency operations and community outreach. He began by summarizing the June 4 Executive Committee meeting, which included early reviews of the draft budget and the prepay financing item. He then explained that Ava’s offices will be temporarily closed from July 14 to September 12 for tenant improvements. During this time, staff will work remotely. The following board and committee meetings will be held at the Rotunda Building at 300 Frank H. Ogawa Plaza, Oakland, CA 94612:
• Monday, July 14, 2025 Community Advisory Committee Meeting • Wednesday, July 16, 2025 Board of Directors Meeting
• Wednesday, September 3, 2025 Executive Committee Meeting • Monday, September 15, 2025 Community Advisory Committee Meeting • Wednesday, September 17, 2025 Board of Directors Meeting Meeting CEO Chang provided an update on the launch of service in Stockton and Lathrop, which began in April. He said the rollout has gone smoothly, with opt-out rates holding steady around 5.35%. He also mentioned a recent interview he did with the Downtown Stockton Alliance to help raise awareness of Ava in the region. Turning to Fremont, he noted that Ava Community Energy
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the city’s residential customers will transition to Ava’s Renewable 100 service in August.

Commercial and industrial customers will follow next year. Ava is currently mailing notifications and participating in local events to ensure residents understand the change and know how to opt out if they choose.

CEO Chang also gave an update on enrollment planning for San Joaquin County. Staff is still working with county officials to decide the best timing, especially in light of the recent PCIA proposed decision and ERRA filing. A recommendation is expected to come to the board in July. On the topic of resilience hubs, CEO Chang reported that Ava’s community innovation grantee, Emerald Cities Collaborative, recently hosted three focus groups— one virtual, one in Oakland, and one in Stockton. Nearly 200 participants and 36 community-based organizations took part, offering feedback that will help shape Ava’s program design.

5. (19:27) CAC Report
CAC Vice-Chair Mickey Souza stated that there is growing concern in the CAC over PG&E’s rising rates and lack of transparency in cost breakdowns, particularly related to wildfire mitigation and infrastructure spending. The CAC is actively exploring strategies to push back against these cost increases. These include launching a public awareness campaign similar to one undertaken by Marin Clean Energy and collaborating with other CCAs through CalCCA.

Vice Chair Souza also reported that the LDBP Ad Hoc is exploring potential strategies to strengthen Ava’s financial position through initiatives such as virtual power plants, on-bill electrification resources, asset development and out of territory subcontracting. The LDBP ad hoc has also requested the restoration of early LDBP planning documents on Ava’s website.

6.(31:08) FY2025-2026 Budget (Action Item)
Approve the budget for Fiscal Year 2025-2026
CEO Howard Chang presented Ava’s proposed FY 2025–2026 budget, focusing on major updates including the CPUC’s proposed decision on PCIA reform and its anticipated $187 million financial impact. Both the base case and upside scenarios now incorporate the PCIA changes, with differences driven by varying assumptions about market prices. To address the projected $35 million deficit, Ava proposes cost reductions, a new compliance-period procurement approach, and use of the GASB 62 Rate Stabilization Fund. CEO Chang stated that while current forecasts are conservative, Ava’s financial strength and prior surpluses position the agency to weather short-term volatility. He requested the board’s approval of the base case budget, which reflects current regulatory developments and includes rate stabilization fund support.

Selected topics raised by Board Members include:

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• Member Roche asked staff to clarify the difference between Ava’s reserve fund and the rate stabilization (or budget stabilization) fund, and how the agency decides where to allocate surpluses.
• Member Morada sought clarification on how much would remain in the rate stabilization fund after the proposed $35 million drawdown, and whether that amount would bring the fund close to any minimum threshold. • Member Tregub asked for an update on Ava’s advocacy efforts related to PCIA reform and inquired whether the CPUC was considering the negative impacts on CCAs. He also asked for clarification on how much of the $187 million impact was attributable to PCIA versus market prices.
• Member Tregub requested an explanation of the differences between the base case and upside budget scenarios.
(1:22:31) Public Comment – Ayla Peters Paz, speaking on behalf of the Local Clean Energy Alliance, urged the Board to support the CAC’s resolution for the budget, and to prioritize legal action to fight policies that threaten Ava and other CCAs. (1:24:28) Public Comment – Bradley Cleveland, representing IBEW Local 595 and the Alliance for Workforce and Environmental Justice, spoke in support of the proposed $10 million allocation to the Local Development Fund. He also encouraged the Board to increase the allocation going to the Local Development Fund if Ava’s financial outlook improves by the mid-year review.
(1:24:28) Public Comment – Jessica Tovar, speaking for the Local Clean Energy Alliance and Clean Power Alliance, spoke in support of the Local Development Business Plan and recommended that Ava consider creating a fund in partnership with local community foundations to support grassroots innovation, resilience, and workforce projects beyond existing engagement programs.

Member Roche motioned to approve the staff recommendation. Vice-Chair Andersen seconded the motion, which was approved 12/0/0/0/6 (yes/no/abstain/recuse/not present)
Yes: Members: Marquez (Alameda County), Tregub (Berkeley), Morada (Dublin), Kaur (Emeryville), Roche (Hayward), Del Catancio (Newark), Rickman (San Joaquin County), Gonzalez (San Leandro), Nygard (Tracy), Sakakihara (Union City), Vice-Chair Andersen (Piedmont) and Chair Balch (Pleasanton) No: none
Abstain: none
Recuse: none
Not Present: Members: Lopez (Albany), Keng (Fremont), Diallo (Lathrop), Barrientos (Livermore), Brown (Oakland) and Fugazi (Stockton)

CONSENT AGENDA

7. Approval of Minutes from May 18, 2025
Ava Community Energy
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8. Contracts Entered Into (Informational Item)

9. PC Pro Consulting Services Agreement & Amendment
New CSA for IT services for FY25-25 and Amendment to increase the NTE of current CSA for FY24-25

10.Thrive Mind Collaborative Consulting Services Agreement Extend CSA for leadership coaching and consulting services

11.Piper Maddox (LHi Group)
Amend two Staffing Services Agreements with LHi GROUP, INC.

12.Dakota Press
Extend CSA for printing services through FY25-26 and increase the NTE

13.Chen Design Associates
Extend CSA for design services through FY25-26 and increase the NTE

14.Legal Services Agreements Approval FY 25-26
Approval for spend on legal vendors for FY 25-26

15.Aramis Contract Amendment
Authorize CEO to execute a contract amendment to the Aramis Agreement

16.Inside Source Contract Approval
Approve furniture purchase related to tenant improvements (1:37:54) Public Comment – Ayla Peters Paz asked the Board to provide greater transparency around how contracts on the consent calendar are selected, including how vendors are evaluated and chosen.

Member Tregub motioned to approve the Consent Agenda. Member Marquez seconded the motion, which was approved 12/0/0/0/6 (yes/no/abstain/recuse/not present)
Yes: Members: Marquez (Alameda County), Tregub (Berkeley), Morada (Dublin), Kaur (Emeryville), Roche (Hayward), Del Catancio (Newark), Rickman (San Joaquin County), Gonzalez (San Leandro), Nygard (Tracy), Sakakihara (Union City), Vice-Chair Andersen (Piedmont) and Chair Balch (Pleasanton) No: none
Abstain: none
Recuse: none
Not Present: Members: Lopez (Albany), Keng (Fremont), Diallo (Lathrop), Barrientos (Livermore), Brown (Oakland) and Fugazi (Stockton) Ava Community Energy
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REGULAR AGENDA

17.Prepay Financing Approval (Action Item)
Authorize staff to enter two prepay transactions, Prepay #4 and Prepay #5 CFO Russell Mills presented Ava’s plan to move forward with two additional prepay power transactions, which allow Ava to access discounted power by leveraging tax-exempt bond financing. He reviewed Ava’s success with three prior prepays that have already generated nearly $22 million in savings and currently deliver $12–15 million in annual cost reductions. Mills discussed enhancements to the transaction structure, including diversifying the funding recipients beyond major banks to reduce risk and increase investor demand. He also spoke about the importance of maintaining Green Bond designation, which aligns with Ava’s climate goals and attracts mission-driven investors. Staff asked the Board to authorize up to two new prepay transactions, not to exceed $1.25 billion each, and requiring a minimum 8% discount on energy costs.

Selected topics raised by Board Members include:
• Vice-Chair Andersen asked how a change in the federal tax landscape would affect the prepay contracts and who would bear the financial risk if tax-exempt status were lost.
• Member Morada asked what makes Ava’s bonds attractive in a saturated bond market, prompting a discussion about green bond designation, credit risk diversification, and investor demand.
• Member Morada also asked whether the energy sector is generally considered a safer investment for bondholders.
• Member Gonzalez asked for clarification on the legal structure of the contracts, specifically whether Ava contracts directly with the energy supplier or through CCCFA, and how the agreements are mirrored to preserve tax-exempt status.

Member Sakakihara motioned to approve the staff recommendation. Member Roche seconded the motion, which was approved 11/0/0/0/7 (yes/no/abstain/recuse/not present)
Yes: Members: Tregub (Berkeley), Morada (Dublin), Kaur (Emeryville), Roche (Hayward), Del Catancio (Newark), Rickman (San Joaquin County), Gonzalez (San Leandro), Nygard (Tracy), Sakakihara (Union City), Vice-Chair Andersen (Piedmont) and Chair Balch (Pleasanton)
No: none
Abstain: none
Recuse: none
Not Present: Members: Marquez (Alameda County), Lopez (Albany), Keng (Fremont), Diallo (Lathrop), Barrientos (Livermore), Brown (Oakland) and Fugazi (Stockton)
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18.Board Member and Staff Announcements including requests to place items on future Board of Directors Meeting Agendas
• Howard Chang thanked staff for their work on the budget and prepay items. • Chair Balch announced a clerical correction to the prepay resolution and reminded board members that the next meeting will be held at the Rotunda Building due to Ava office tenant improvements.
• Chair Balch announced his intention to step down as Chair at the July meeting to ensure a smoother leadership transition ahead of 2026 and requested that Chair and Vice Chair appointments be agendized for July. • Vice-Chair Andersen acknowledged Juneteenth as a time for national reflection on liberty and equity.
• Member Gonzalez thanked Ava staff for attending the Cherry Festival and made three requests: (1) a future discussion on customer education and advocacy regarding electricity rates, (2) a review of potential expansion of R100 in other cities, and (3) Ava’s potential involvement in the upcoming "Sun-Day" climate event hosted by Third Act in San Leandro.
• Member Roche issued an invitation to Hayward’s Juneteenth celebration at Heritage Plaza on Saturday, June 21, 2025.
• Chair Balch confirmed that the Power Content Label will return as a board item later in the year.

19.Adjourned at 8:08pm
The next Ava Board of Directors meeting will be held on Wednesday, July 16, 2025 at 6pm.

Please note the temporary location:

Rotunda Building
Large Conference Room
300 Frank Ogawa Plaza
Oakland, CA 94612

Consent Item 5
Consent Item 5
To: Ava Community Energy Authority
From: Howard Chang, Chief Executive Officer
Subject: Contracts Entered Into
Date: July 16, 2025
_____________________________________________________________________

RECOMMENDATION
Accept the CEO’s report on contracts that Ava Community Energy has entered into, as required by the Administrative Procurement Policy, from June 11, 2025, through July 11, 2025; C-2025-113 Keyes and Fox (San Francisco)Joint Representation Agreement Keyes and Fox will represent Ava Community Energy, Central Coast Community Energy, CleanPowerSF, Marin Clean Energy, Peninsula Clean Energy Authority, City of San Jose, Silicon Valley Clean Energy, and Sonoma Clean Power Authority regarding PG&E's Application for Approval of its Billing Modernization Initiative.

C-2025-114 Almanac Co. (Alameda, CA) Purchase Rider, private event contract for June 17, 2025, event with a maximum compensation of $1,000.

C-2025-115 Braun Blaising & Wynne, P.C (Sacramento) June 2025 Amendment to the Consulting Services Agreement Adds $25,000 in additional compensation for new NTE of $109,000 and extends term through June 30, 2026.

C-2025-116 The Law Office of Joseph F. Wiedman (Cloverdale, CA) June 2025 Amendment to the Consulting Services Agreement Adds $50,000 in additional compensation for new NTE of $194,000 and extends term through June 30, 2026.

C-2025-117 Afaf Translations (San Leandro) May 2025 Purchase Rider Afaf will provide translations and interpretation for a NTE of $10,000 through June 30, 2026.

C-2025-118 Salesforce, Inc. Order Form: Additional Salesforce licenses at a cost of $1,711.00.

Consent Item 5
C-2025-119 Inside Source Washington, Inc. (Seattle, WA) May 2025 Purchase Rider, for furniture related to Tenant Improvements (TI) with cost not to exceed $29,188.69.

C-2025-120 Rubicon Point Partners (Oakland) June 2025 Purchase Rider provides a temporary location at the Rotunda to host Ava's September and July BOD, CACe, FAP and Exec Comm. meetings with compensation not to exceed $5,104 through September 30, 2025.

C-2025-121 S&P Global Commodity Insights, a division of S&P Global Inc. Services Attachment to Master Subscription Agreement for CSM+, for additional CSM services.

C-2025-122 Hall Energy Law (Oregon) June 2025 Consulting Services Agreement provides legal services related to power procurement, effective July 1, 2025, through June 30, 2026, with a maximum compensation of $400,000.

C-2025-123 Keyes and Fox (San Francisco, CA) June 2025 Consulting Services Agreement, provides general regulatory legal support, effective July 1, 2025, through July 31, 2025, with a maximum compensation of $150,000.

C-2025-124 Nixon Peabody (San Francisco) June 2025 Consulting Services Agreement, provides legal services related to Ava financial issues, including but not limited to review of credit facilities, issuance of bonds and other financings mechanisms, and financing of office building; Insurance generally; and Third-party bankruptcy related matters for a NTE of $200,000 through June 30, 2026.

C-2025-125 Oakland Venue Management (Oakland) Second Amendment to Consulting Services Agreement, increases the compensation for FY24-25 to $48,942, extends the term through June 30, 2026, provides for compensation NTE $56,500 for FY25-26, and updates the schedule.

C-2025-126 Wilson, Sonsini, Goodrich and Rosati (Seattle, WA) Consulting Services Agreement, providing legal services related to power procurement, bankruptcy, employment law and privacy-related compliance matters, effective July 1, 2025, through June 30, 2026, with a maximum compensation of $1,045,000.

C-2025-127 GB Endeavors LLC, (Oceanside) June 2025 Amendment to the Consulting Services Agreement, for executive coaching, increases the NTE by $8,600, with total compensation not to exceed $15,000.

C-2025-128 Inside Source Washington, Inc. (Seattle, WA) Proposal for furniture purchase and installation with compensation not to exceed $350,000
C-2025-129 Port Labs (Oakland) Ava Summer Hub at Port Labs, temporary office space rental during July, August, and September 2025 for up to 26 Ava employees during office improvements at 1999 Harrison, at a cost of $13,7000.

C-2025-130 Richards, Watson and Gershon (San Francisco) Consulting Services Agreement, providing General Counsel services, effective July 1, 2025, through June 30, 2025, with a maximum compensation of $210,000.

C-2025-131 California First Aid and Safety, Inc. (San Francisco) June 2025 Amendment to the Consulting Services Agreement extends the term through June 30, 2026, adds $20,000 for first Consent Item 5
and supplies and classes from July 1, 2025, to June 30, 2026, with a maximum compensation of $40,000.

C-2025-132 PC Professional, Inc (Oakland) June 2025 Amendment to the Consulting Services Agreement for IT technical support, remote and onsite at Ava offices for the term July 1, 2025, through June 30, 2026, with compensation not to exceed $275,000.

C-2025-133 Meyers Nave (Oakland) June 2025 Amendment to the Engagement of Legal Services Amends Engagement Letter to add additional compensation of $1,000,000, increasing the not-to-exceed amount by $2,766,368.65 and extending the term through June 30, 2026.

C-2025-134 Chen Design Associates (Oakland) June 2025 Amendment to the Consulting Services Agreement (Oakland) adds additional compensation, increasing the not-to-exceed amount by $220,000 for a total amount not to exceed $520,000, and to extend the term through June 30, 2026.

C-2025-135 Coursera (Mountain View) Renewal to Order Form allows for 35 User Licenses for 12 months to their professional learning platform, through August 5, 2026, and a cost of $10,500.

C-2025-136 PFM Finacial Advisors, LLC (Philadelphia, PA) Engagement Letter dated May 19, 2025, PFM will serve as municipal advisor to Ava Community Energy in connection with the structuring and competitive procurement of the investment agreement for the Debt Service Account related to the Clean Energy Project Revenue Bonds, compensation of $50,000 is contingent upon the Investment Agreeing being executed and delivered.

C-2025-137 Davis Wright Tremaine (Washington) Consulting Services Agreement, providing legal advice regarding regulatory agencies, effective July 1, 2025, through June 30, 2026, with a maximum compensation of $120,000.

C-2025-138 Salesforce Order Form, Service Cloud and Sandbox services, effective January 1, 2025, with a maximum compensation of $1,939.72.

C-2025-139 Salesforce Order Form, Lightning Platform Plus, Service Cloud, and Sandbox services, effective April 8, 2025, with a maximum compensation of $1,097.33.

C-2025-140 Thrive Mind Collaborative, (San Luis Obispo) June 2025 Amendment to the Master Service Agreement adds $190,000 in additional compensation to the not to exceed amount for leadership coaching and development services for FY25-26, updates the scope of work, and extends the term through June 30, 2026.

C-2025-141 Clean Energy Counsel (San Francisco) July 2025 Consulting Services Agreement for Power procurement legal services, compensation not to exceed $150,000.

C-2025-142 Ayala-Bass Law P.C. (San Francisco) June 2025 Consulting Services Agreement, for legal negotiations and potential litigation, compensation not to exceed $100,000.

C-2025-143 Path to Summit, (Louisiana) June 2025 Amendment to the Consulting Services Agreement adds $10,000 in compensation for Asana project management and training support services, with total compensation not to exceed $15,000.

Consent Item 5
C-2025-144 PC Professional, Inc, (Oakland) June 2025 Sixth Amendment to Consulting Services Agreement, adds $100,000 in additional compensation through June 30, 2025, for IT support services.

Consent Item 6
Consent Item 6
To: Ava Community Energy Authority
From: Karen Lee, Senior Manager, Power Resources and VPP Subject: Approving a Resolution Authorizing the Chief Executive Officer to Negotiate and Execute a Second Amendment to the Behind the Meter Energy Storage Agreement for Resilience with Sunrun, Inc.

Date: July 16, 2025
__________________________________________________________________ Summary/Recommendation
This memorandum proposes amending the Behind the Meter Energy Storage Agreement for Resilience to reduce the minimum contract capacity and clarify the calculation of monthly payment and damages.

Analysis and Context
Ava executed a Behind the Meter Energy Storage Agreement for Resilience with Sunrun, Inc. (“Seller”) on July 1, 2020, as amended by the First Amendment dated May 9, 2024 (“Agreement”).

The Agreement is for 1.35 Mega-watt (“MW”) / 5.4 Mega-watt hour (“MWh”) of load modification from behind-the-meter solar plus storage resources located in Ava’s service territory (“Project”).

The Project has been operational since January 1, 2023.

The original Project was evaluated during the East Bay Community Energy, Peninsula Clean Energy, Silicon Valley Clean Energy & Silicon Valley Power Request for Proposals (“RFP”) for Bay Area Distributed Resource Adequacy Capacity. The RFP was launched in November 2019, and the Agreement was approved for execution during Ava’s Board of Directors meeting on June 17, 2020.

Consent Item 6
The Project has experienced challenges with meeting the minimum contract capacity in certain months, resulting in under-deliveries. In addition, Ava and Sunrun have been in dispute regarding the calculation of monthly invoices and damages. This Second Amendment reduces the minimum contract capacity and clarifies the calculation of monthly invoices and damages.

Ava is requesting the Board to authorize the Chief Executive Officer (“CEO”) to continue to negotiate and execute a Second Amendment.

Attachments
A. Resolution Authorizing the Chief Executive Officer to Negotiate and Execute a Second Amendment to the Behind the Meter Energy Storage Agreement for Resilience with Sunrun, Inc.

Attachment Consent Item 6A
RESOLUTION NO. R-2025-XX

A RESOLUTION OF THE BOARD OF DIRECTORS

OF AVA COMMUNITY ENERGY AUTHORITY AUTHORIZING THE CHIEF

EXECUTIVE OFFICER TO NEGOTIATE AND EXECUTE A SECOND

AMENDMENT TO THE BEHIND THE METER ENERGY STORAGE
AGREEMENT FOR RESILIENCE WITH SUNRUN, INC.

WHEREAS Ava Community Energy Authority (“Ava”) was formed as a community choice aggregation agency (“CCA”) on December 1, 2016, under the Joint Exercise of Powers Act, California Government Code sections 6500 et seq., among the County of Alameda, and the Cities of Albany, Berkeley, Dublin, Emeryville, Fremont, Hayward, Livermore, Piedmont, Oakland, San Leandro, and Union City to study, promote, develop, conduct, operate, and manage energy-related climate change programs in all of the member jurisdictions. The Cities of Newark and Pleasanton, located in Alameda County, along with the City of Tracy, located in San Joaquin County, were added as members of Ava and parties to the Joint Powers Agreement (“JPA”) in March of 2020. The City of Stockton was added as a member to Ava in September of 2022. The City of Lathrop was added as a member to Ava in October of 2023. San Joaquin County was added as a member to Ava in July 2024.

On October 24, 2023, Ava legally adopted the name Ava Community Energy Authority, where it had previously used the name East Bay Community Energy Authority since its inception.

WHEREAS Ava executed a Behind the Meter Energy Storage Agreement for Resilience with the Sunrun, Inc. (“Seller”) on July 1, 2020, as amended by the First Amendment dated May 9, 2024, collectively the “Agreement”; and WHEREAS The Agreement is for a minimum of 1.35-Megawatts (“MW”) and

5.4-Megawatt hours (“MWh”) of load modification from behind-the-meter solar plus storage resources located in Ava’s service territory, with operations having started January 1, 2023; and
WHEREAS Ava has negotiated with the Seller to reduce the contract minimum to 1.00 MW and 4.0 MWh of load modification and clarify the calculation of monthly invoices and damages.

NOW, THEREFORE, THE BOARD OF DIRECTORS OF AVA COMMUNITY ENERGY AUTHORITY DOES HEREBY RESOLVE AS FOLLOWS:

Section 1. The Chief Executive Officer, in consultation with staff and legal counsel, is hereby authorized to negotiate and execute a Second Amendment to the Behind the Meter Energy Storage Agreement for Resilience with Sunrun, Inc.

Attachment Consent Item 6A
ADOPTED AND APPROVED this 16th day of July, 2025.

Jack Balch, Chair
ATTEST:

Adrian Bankhead, Clerk of the Board
Consent Item 7
Consent Item 7
To: Ava Community Energy Authority
From: Theresa McDermit, Head of Marketing
Subject:

Approving a Resolution Authorizing Negotiation and Execution of a Sponsorship Agreement with the Oakland Roots Sports Club for the 2026 and 2027 seasons of the Roots and Soul Soccer Teams
Date: July 16, 2025
__________________________________________________________________ Summary/Recommendation
Approve a Resolution authorizing the CEO to negotiate and execute a Sponsorship Agreement with the Oakland Roots Sports Club (“Oakland Roots SC”) for the 2026 and 2027 seasons of the Roots and Soul in support of marketing and brand value. The sponsorship ($175,000 in 2026; $200,000 in 2027) would make Ava Community Energy (Ava) the Clean Energy Partner of both teams, and the benefits include jersey sleeve logo placement for both teams, significant brand presence in the Coliseum for Roots games, field signage, on-site activation space, in-game digital assets, social media posts, and special events.

Financial Impact
This sponsorship is $175,000 total for the 2026 season and $200,000 for the 2027 season of the Roots and Soul teams. The cost of Ava’s sponsorship of these teams was $175,000 in 2025 for a similar scope of assets. Funds have been allocated in the current FY budget for this level of sponsorship and will be requested next fiscal year for the 2027 sponsorship expense.

Analysis and Context
Consent Item 7
Oakland Roots SC is the first purpose-driven professional sports team in the United States.

Their United Soccer League (USL) men's team is one of the fastest-growing brands in American sports, and they are one of the only remaining professional sports teams in Ava’s service territory. 2023 marked the inaugural USL-W season for the club’s affiliated women’s soccer team, Oakland Soul.

Oakland Roots SC partnerships combine sponsorship opportunities with community impact, creative storytelling, and employee engagement. Ava is a founding partner of the Roots, sponsoring the team since 2018, and similarly was a foundational sponsor of the Oakland Soul, sponsoring them since their inaugural season in 2023.

Ava’s past sponsorship provided significant brand and program promotional opportunities for the agency. Our partnership has helped Ava communicate with a diverse local fan base and has associated our brand with a fun and popular form of community entertainment. Ava’s marketing team activated an informational booth at most home games, to connect with thousands of attendees, and received other promotional benefits.

In addition to the benefit of on-site activation presence, this 2026-2027 sponsorship package continues Ava’s standing as the Clean Power Partner of both Roots and Soul, places the full Ava logo on the sleeve of team jerseys (including on their merchandise jerseys), creates a significant brand presence for Ava at the Coliseum during Roots games, provides on-field signage, and provides messaging on the stadium video board. Additional benefits include social media posts, a press release, and game tickets.

Ava’s past sponsorship levels are as follows:
● 2019 - $25,000
● 2020 - $25,000
● 2021 - $125,000 (the Roots moved up to USL)
● 2022 - $125,000
● 2023 - $135,000 ($125k Roots/ $10k for Soul)
● 2024 - $196,000 ($150k Roots/ $46k Soul – back of jersey sponsor) ● 2025 - $175,000 ($141k Roots/ $34k Soul – back of jersey sponsor) Committee Recommendation
Ava staff have not presented this recommendation to the Marketing, Regulatory, and Legislative committee since it is a similar scope and cost to the previous agreement for the 2025 season.

Attachment
A. Resolution of the Board of Directors of Ava Community Energy Authority Authorizing the Negotiation and Execution of a Sponsorship Agreement with the Oakland Roots Sports Club for the 2026 - 2027 seasons of the Roots and Soul Soccer Teams Attachment Consent Item 7A
RESOLUTION NO. R-2025-XX

A RESOLUTION OF THE BOARD OF DIRECTORS

OF AVA COMMUNITY ENERGY AUTHORITY AUTHORIZING THE NEGOTIATION

AND EXECUTION OF A SPONSORSHIP AGREEMENT WITH THE OAKLAND ROOTS SPORTS CLUB FOR THE 2026 AND 2027 SEASONS OF THE ROOTS AND

SOUL SOCCER TEAMS
WHEREAS Ava Community Energy Authority (“Ava”) was formed as a community choice aggregation agency (“CCA”) on December 1, 2016, under the Joint Exercise of Powers Act, California Government Code sections 6500 et seq., among the County of Alameda, and the Cities of Albany, Berkeley, Dublin, Emeryville, Fremont, Hayward, Livermore, Piedmont, Oakland, San Leandro, and Union City to study, promote, develop, conduct, operate, and manage energy-related climate change programs in all of the member jurisdictions. The Cities of Newark and Pleasanton, located in Alameda County, along with the City of Tracy, located in San Joaquin County, were added as members of Ava and parties to the Joint Powers Agreement (“JPA”) in March of 2020. The City of Stockton was added as a member to Ava in September of 2022. The City of Lathrop was added as a member to Ava in October of 2023. San Joaquin County was added as a member to Ava in July 2024. On October 24, 2023, Ava legally adopted the name Ava Community Energy Authority, where it had previously used the name East Bay Community Energy Authority since its inception.

WHEREAS Ava’s marketing activities seek to inform our customers about the benefits of Ava’s electricity service, as well as introduce customers to programs that Ava offers that might save them money and/or improve environmental outcomes; WHEREAS Oakland Roots Sports Club (“Oakland Roots SC”) is a leading professional sports franchise that is community-focused and whose sponsorship affords partners access to a large local fan base;
WHEREAS Ava sponsored the Oakland Roots and Oakland Soul soccer teams for their 2025 seasons at a sponsorship level of $175,000, including placement of the Ava logo on the back of their jerseys;
WHEREAS the 2025 Roots season took place in the Oakland Coliseum with attendance as high as 25,000 per game, and expanded brand exposure and one-on-one engagement during game days; WHEREAS the 2026 and 2027 seasons are set to attract similar or larger crowds that will continue to provide brand exposure and the opportunity for engagement; and, WHEREAS the jersey sleeve sponsorship and the opportunity for significant brand activation within the Coliseum on Roots game days provide a unique brand opportunity.

NOW, THEREFORE, THE BOARD OF DIRECTORS OF AVA COMMUNITY ENERGY AUTHORITY DOES HEREBY RESOLVE AS FOLLOWS:

Attachment Consent Item 7A
Section 1. Authorize the CEO to negotiate and execute a sponsorship agreement with the Oakland Roots SC for the 2026 and 2027 seasons of the Roots and Soul soccer teams, in consultation with legal counsel, at a not to exceed amount of $375,000.

ADOPTED AND APPROVED this 16th day of July, 2025.

Jack Balch, Chair
ATTEST:

Adrian Bankhead, Clerk of the Board
Consent Item 8
Consent Item 8
To: Ava Community Energy Authority
From: Ray Dai, Power Recourses Market and Credit Risk Manager Subject: Request for Approval of the Ava Energy Risk Management Policy v2.0 Date: July 16, 2025
__________________________________________________________________ Summary/Recommendation
This Staff Report proposes adopting a Resolution approving updates to the Ava Energy Risk Management Policy in order to update Ava’s name change from EBCE and personnel titles, clarify Ava’s risk management practices, and ensure consistency with the Ava Energy Risk Management Regulations.

Financial Impact
N/A
Analysis and Context
Ava has two Energy Risk Management (ERM) documents:

The ERM Policy outlines high-level principles and philosophies. The ERM Regulations provide detailed, implementable procedures and elaborate on roles, strategies, controls, and authorities referenced in the Policy, forming a comprehensive energy risk management framework.

For example:
• The Policy permits transactions in approved products, which are specified in the Regulations.

Consent Item 8
• The Policy emphasizes segregation of duties with roles and responsibilities that are detailed in the Regulations.
• The Policy requires that authorized personnel execute transactions that are specified in an authority matrix detailed in the Regulations
The Ava Board approved and adopted the Ava Energy Risk Management Policy on February 7, 2018.

The Policy authorizes the CEO to create a Risk Oversight Committee to support the CEO and provide oversight with respect to the development of policies, protocols, procedures to manage risk associated with the procurement of commodity products in Ava’s portfolio. The Risk Oversight Committee provides guidance and approval or rejection of any updates to the Energy Risk Management Regulations that may be necessary from time to time to implement the Energy Risk Management Policy.

Updates to the ERM are necessary to ensure consistency between the Policy and Regulations and to ensure the Policy reflects CEO and ROC practices.

Committee Recommendation
Ava Risk Oversight Committee reviewed and recommended approval of the Ava Energy Risk Management Policy v2.0 at its 2025 Quarter 1 meeting on February 26, 2025. Staff presented to the Finance, Administrative, and Procurement Committee on July 9, 2025.

Attachments
A. A Resolution of the Board of Directors of the Ava Community Energy Authority Approving the Energy Risk Management Policy v2.0
B. Energy Risk Management Policy v2.0
C. Energy Risk Management Policy v2.0 Redlined
Attachment Consent Item 8A
RESOLUTION NO. R-2025-XX

A RESOLUTION OF THE BOARD OF DIRECTORS

OF THE AVA COMMUNITY ENERGY AUTHORITY APPROVING THE
ENERGY RISK MANAGEMENT POLICY V2.0
WHEREAS Ava Community Energy Authority (“Ava”) was formed as a community choice aggregation agency (“CCA”) on December 1, 2016, under the Joint Exercise of Powers Act, California Government Code sections 6500 et seq., among the County of Alameda, and the Cities of Albany, Berkeley, Dublin, Emeryville, Fremont, Hayward, Livermore, Piedmont, Oakland, San Leandro, and Union City to study, promote, develop, conduct, operate, and manage energy-related climate change programs in all of the member jurisdictions. The cities of Newark and Pleasanton, located in Alameda County, along with the City of Tracy, located in San Joaquin County, were added as members of Ava and parties to the Joint Powers Agreement (“JPA”) in March of 2020.

The city of Stockton was added as a member to Ava in September of 2022. The city of Lathrop was added as a member to Ava in October of 2023. San Joaquin County was added as a member to Ava in July 2024. On October 24, 2023, Ava legally adopted the name Ava Community Energy Authority, where it had previously used the name East Bay Community Energy Authority since its inception.

WHEREAS The Ava Board approved and adopted the Ava Energy Risk Management Policy on February 7, 2018.;
WHEREAS Administrative changes of names and titles are necessary to ensure accuracy and consistency with the Energy Risk Management Regulations and to reflect Ava’s growth and organizational changes.

NOW, THEREFORE, THE BOARD OF DIRECTORS OF AVA COMMUNITY ENERGY AUTHORITY DOES HEREBY RESOLVE AS FOLLOWS:

To Board adopts The Ava Energy Risk Management Policy version 2.0 with minor changes for accuracy and consistency attached hereto, effective immediately.

ADOPTED AND APPROVED this 16th day of July, 2025.

Attachment Consent Item 8A
Jack Balch, Chair
ATTEST:

Adrian Bankhead, Clerk of the Board
Energy Risk Management Policy
Version 2.0
Approved
July 16, 2025
Attachment Consent Item 8B
Energy Risk Management Policy
i
Table of Contents

1. Philosophy, Objectives and Scope ....................................................................................... 1

1.1. Risk Philosophy ............................................................................................................... 1

1.2. Business Activities ........................................................................................................... 1

1.3. Transacting Objectives ..................................................................................................... 1

1.4. Scope of Policy................................................................................................................. 2

1.5. Applicability ..................................................................................................................... 2

1.6. Policy Review and Amendments ..................................................................................... 2

2. Risk Strategy & Parameters ................................................................................................ 3

2.1. Counterparty Risk Management....................................................................................... 3

2.2. Balanced Load .................................................................................................................. 3

2.3. Minimum Coverage Requirements .................................................................................. 3

2.4. Diversification of Portfolio .............................................................................................. 3

2.5. Purchase to Cover Load Serving Obligations - No Speculation ..................................... 3

2.6. Use of Derivatives and Financial Transactions ................................................................ 4

3. Risk Controls ......................................................................................................................... 4

3.1. Control Principles ............................................................................................................. 4

3.2. Internal Controls ............................................................................................................... 5

3.3. Segregation of Duties ....................................................................................................... 5

3.4. Conflicts of Interest .......................................................................................................... 5

4. Roles, Responsibilities, & Organization.............................................................................. 5

4.1. Ava Board of Directors .................................................................................................... 6

4.2. Chief Executive Officer .................................................................................................. 6

4.3. Risk Oversight Committee ............................................................................................... 6

4.4. Front Office (Planning and Procurement) ........................................................................ 6

4.5. Middle Office Controls and Reporting............................................................................. 7

4.6. Back Office (Settlements and Recording) ........................................................................ 7

4.7. Auxiliary Functions .......................................................................................................... 7

4.8. Authorities, Delegations, Limits and Prohibitions ........................................................... 7

5. Policy Compliance ................................................................................................................. 8

5.1. Compliance Exceptions .................................................................................................... 8

5.2. Reporting of Exceptions ................................................................................................... 8

5.3. Audit ................................................................................................................................. 8

5.4. Reserves ........................................................................................................................... 8

5.5. Systems, Tools and Training ............................................................................................ 8 Attachment Consent Item 8B
Energy Risk Management Policy
1 1. Philosophy, Objectives and Scope
This Energy Risk Management Policy (ERMP) outlines the philosophies and objectives of Ava Community Energy (Ava) Board of Directors (Board). The Energy Risk Management Regulations (ERMR) also adopted by Ava expand on the roles, strategies, controls and authorities authorized in this policy to form a comprehensive energy risk management program.

The ERMR shall be read in conjunction with this ERMP.

1.1. Risk Philosophy
The overall goal of this ERMP is to:
• Serve the participating jurisdictions’ needs subject to Board approved risk tolerance limits;
• Provide as much energy supply (generation and capacity) cost certainty for Ava’s customers as possible while maintaining a least cost supply portfolio; and • Enhance the value of Ava’s assets to meet the financial goals and requirements of the participating jurisdictions.

As a joint powers authority, Ava is in the business of generation, transmission and procurement of energy for the benefit of its participating jurisdictions. Ava’s objective is to develop the least cost supply portfolio to meet load requirements of its customers, while maximizing revenues from sales of surplus energy, capacity and other wholesale energy and transmission services (e.g. resource optimization). However, unlike a private-sector entity, Ava’s primary purpose in the power supply business is to serve its customers. Ava’s goal is to be a cost hedger for its participating jurisdictions’ load and, therefore, is precluded by this policy from engaging in speculative activities typical to many organizations orientated toward profit maximization.

Ava management recognizes that certain risks are incidental to normal power supply operations and hedging activities. Ava’s goal is to avoid unnecessary risk and to limit, to the extent practicable, any risks associated with normal cost-hedging activities. This document serves as a vehicle to describe and define the limits for activities considered as appropriate for Ava in a normal course of business.

1.2. Business Activities
A primary part of Ava’s main business is to procure or produce power supplies, capacity, and reserves to meet its customer load requirements. The resource (capacity/energy) supply portfolio may consist of physical assets, such as power plants and distributed energy resources, fixed and variable priced supply contracts of varying lengths, and agreements for other related supplies and services needed to ensure reliable delivery of electricity to Ava’s customers.

1.3. Transacting Objectives
Ava’s overall transacting objective is to meet the load requirements of its customers with an optimized resource supply portfolio. Ava’s objectives when transacting on behalf of its Attachment Consent Item 8B
Energy Risk Management Policy
2 customers for the procurement of energy and energy related supplies and services are as follows:
• Meet customer load requirements including energy, capacity and reserves; • Provide stable rates for the participating jurisdictions; • Obtain the best available price for power supply while complying with the requirements of this policy and other objectives established by the Board (e.g. renewable energy policy goals);
• Manage Ava’s assets to optimize value;
• Act to limit exposure to extreme market system changes; • Follow effective wholesale counterparty credit management procedures; and • Develop and maintain Ava’s investment grade credit rating.

1.4. Scope of Policy
This ERMP addresses risks arising from Ava’s participation in the wholesale energy markets and applies to all energy and energy related transactions made by Ava. This ERMP does not address the following types of general property and casualty business risk: fire, accident and casualty; health, safety, and workers’ compensation; general liability; and other such typically insurable perils. The term “risk management,” as used herein, is therefore understood to refer solely to risks related to participation in wholesale energy markets as herein defined.

Ava is exposed to three quantifiable risks: load and resource variability (volumetric), cost variability (price), and counterparty credit risk. From the perspective of risk mitigation, Ava’s primary objective is to cover load and optimize the value of assets. Taking risks in order to arbitrage market opportunities, or risks unrelated to Ava’s normal power supply business activities, is not permitted.

Ava is also exposed to regulatory and operational risks. However, these exposures are not quantifiable as they affect structural change. As a result, these risk categories are managed as separate enterprise risk exposures and are not directly governed by this ERMP.

This ERMP prescribes the management organization, authority and processes to monitor, measure and control the risks to which Ava is exposed in the normal course of business. Specific methodologies used to measure, monitor and control these risks shall be established by the Chief Executive Officer’s Risk Oversight Committee (ROC), in accordance with sound utility practices and included in the ERMR.

1.5. Applicability
This ERMP is effective immediately upon its adoption by the Board. It applies to Ava’s wholesale supply operations, long-term contracting for energy/capacity and services, acquisition of generation resources, credit risk management and other related ancillary activities undertaken by Ava.

1.6. Policy Review and Amendments
Attachment Consent Item 8B
Energy Risk Management Policy
3 Prudence is required in implementing any and all policies and procedures. Market and industry norms, technology and risk tolerances tend to change over time. Therefore, this policy should be reviewed as needed, in order to make adjustments in response to changes in business objectives and/or industry norms. Amendments to this ERMP shall be done only by approved Resolution of the Board.

2. Risk Strategy & Parameters
An important aspect of implementing an overall energy risk management policy is the development of related strategies to mitigate all of the related risks associated with energy transacting activities. The key strategies of Ava are outlined below.

2.1. Counterparty Risk Management
Counterparty risk is defined as the exposure to economic loss resulting from default by a party to a contract (e.g., a counterparty). Counterparty risk affects both contracts requiring physical settlement and those specifying monetary settlement. For all fixed price energy transactions, the counterparty must possess at least a BBB- (or equivalent investment grade rating) by a nationally recognized statistical rating organization (NRSRO). Ava staff may consider counterparties with a rating below investment grade, or a counterparty without a NRSRO rating on a case-by-case basis, with the approval of the ROC.

Effective wholesale counterparty management and credit analysis is essential to mitigate the counterparty risks associated with commodity transactions in the energy markets. The objective is to preserve Ava’s capital, liquidity, and supply reliability by limiting counterparty credit risk and supplier concentration to acceptable levels. Methodologies to achieve this objective are set forth in the ERMR.

2.2. Balanced Load
Ava shall maintain an integrated and balanced portfolio of resources to cover its customer load within a dual volume and cost-at-risk framework.

2.3. Minimum Coverage Requirements
Ava shall establish minimum coverage requirements, combined with defined cost-at-risk metrics, for capacity and energy as determined by the ROC and outlined in the ERMR.

2.4. Diversification of Portfolio
Ava shall strive to develop a resource portfolio that includes diversification in fuel type, contract duration, geographic location, counterparty, pricing terms, cash reserves and types of products.

2.5. Purchase to Cover Load Serving Obligations - No Speculation As discussed in Section 1.3, Ava’s overall objective for energy procurement activities is to cover Attachment Consent Item 8B
Energy Risk Management Policy
4 the load serving obligations of its customers. In the course of performing these activities, Ava shall not engage in activities that expose its participating jurisdictions to speculative transactional risks and shall only utilize approved transaction parameters as determined by the ROC and outlined in the ERMR.

2.6. Use of Derivatives and Financial Transactions
Use of financial derivatives or transactions (as opposed to physical or “embedded” options) is allowed in limited circumstances by Ava. These include transactions used to set price caps and floors, or hedge against load/price volatility. Examples include:
• Exchange traded Puts and Calls;
• Electric Futures;
• Electric Options; and
• Weather Derivatives.

Use of certain types of financial derivatives is necessary in order to mitigate various risks outlined in this policy while optimizing the resource portfolio. Such types of allowable financial derivatives or transactions (but not individual transactions) must be approved by the ROC as outlined in the ERMR as developed by the ROC in accordance with this policy.

3. Risk Controls

3.1. Control Principles
Ava will strive to conduct its energy risk management activities in accordance with best practices of the energy industry, but implementing such practices must be cost justified and balanced between costs and benefits. Processes and control systems must be in place that allow Ava to identify, measure, monitor, control and track its risk exposures. These processes and control systems shall include the following risk management control principles:
• Appropriate segregation of duties and internal controls will be used; • Appropriate systems to ensure accurate and effective management reporting; • Necessary resources in place to achieve management objectives; • Attract and retain skilled and trained personnel;
• Cross-train and provide cross coverage;
• Employees conducting energy transactions are free of conflicts of interest; • Authority and approval delegation is commensurate with accountability and capability;
• Performance measurement and reporting incorporate risk and return measures; and • Ongoing monitoring of control effectiveness.

Attachment Consent Item 8B
Energy Risk Management Policy
5 3.2. Internal Controls
Internal controls shall be based on proven principles that meet the stringent requirements of generally accepted auditing standards (GAAS), financial institutions and credit rating agencies.

The required controls shall include all customary and usual business practices designed to 1) prevent errors and improprieties, 2) ensure accurate and timely reporting of results of operations and other information pertinent to management, and 3) facilitate attainment of business objectives.

3.3. Segregation of Duties
Responsibilities related to energy transacting shall be segregated in a manner consistent with the control principles listed above by means of clearly defined roles and responsibilities for the Front Office, Middle Office and Back Office operations. Such roles and responsibilities can also be provided by a qualified third-party services provider. Specific roles, responsibilities and organizational structure of these functions are outlined in Section 4 of the ERMP.

These controls shall be fully integrated into all business activities of Ava, and there shall be active participation by senior management in risk management processes.

3.4. Conflicts of Interest
All Ava employees who are engaged in energy supply resource transactions, counterparty credit evaluation, or oversight of the foregoing and are employed in any job classification listed in the Ava Conflict of Interest Code are required to complete annual conflict of interest filings on FPPC Form 700 and disclose investments as required by that code.

In addition to the foregoing disclosure requirement, Ava employees engaged in energy supply resource transactions, counterparty credit evaluation or oversight of the foregoing, are barred from investing in any company with whom Ava has consummated energy or related purchases or sales within the last two years.

Such employees must divest existing direct holdings in energy counterparties prior to engaging in any negotiating, evaluating, transacting or oversight functions. The ban on investment and requirement for divestment applies regardless of whether or not the investment would be of sufficient size ($2,000) to require disclosure on FPPC Form 700.

Ava employees supervising staff who are subject to this policy are responsible for routinely reviewing Form 700 of each such staff member for the purpose of identifying potential financial conflicts of interest. General Counsel will assist in reviewing these forms and providing legal advice in connection with such reviews upon request.

4. Roles, Responsibilities, & Organization
This section of the ERMP defines the overall roles and responsibilities for implementation of this ERMP. The coordinated efforts of personnel across several divisions are required to successfully Attachment Consent Item 8B
Energy Risk Management Policy
6 implement Ava’s risk management program. Section 4 of the ERMP outlines the basic roles and responsibilities of each organizational function. Specific details and the specific roles and responsibilities of the oversight and operational divisions within the energy risk management program structure at Ava are outlined in the ERMR, as developed by the ROC and revised from time to time.

4.1. Ava Board of Directors
The Board has the ultimate oversight over Ava operations and is responsible for establishing an organizational-wide framework for risk management and ensuring that risk management results are achieved as planned. The Board shall approve and establish organizational policies for risk management and delegate to the Chief Executive Officer the responsibility for implementing the ERMP. With responsibility for the ultimate oversight over Ava operations, the Board shall be responsible to ensure the risk management results are achieved in accordance with the ERMP.

4.2. Chief Executive Officer
The Chief Executive Officer has overall responsibility for implementing the ERMP and for communicating risk management issues to the Board. The Chief Executive Officer shall be responsible for delegating specific duties for carrying out the policy and insuring compliance with it by all affected Ava employees or contractors. The Board acknowledges that the Chief Executive Officer shall established the ROC as a member/staff function and may delegate certain functions to the ROC, which delegation is ratified by this ERMP.

4.3. Risk Oversight Committee
The Risk Oversight Committee (ROC) is responsible for overseeing compliance with risk management policies within Ava. The ROC serves as the highest level of organizational risk management reporting to the Chief Executive Officer. The ROC shall consist of at least five (5) members including Ava Management, participating jurisdictional representatives and Ava’s legal counsel, as designated by the Chief Executive Officer from time to time. A quorum for the ROC to do business shall be a simple majority of Committee members or their designees.

The participating jurisdictions may nominate potential ROC members. The Chief Executive Officer shall select ROC representatives in his or her sole discretion. Each ROC member shall have one vote, and may appoint a voting alternate with the approval of the Chief Executive OfficerThe ROC will meet at least quarterly, to act on the responsibilities mentioned above. The ROC shall have the responsibility for monitoring that business is conducted in accordance with the ERMP and advising the CEO. The ROC shall adopt and keep current “Energy Risk Management Regulations,” which shall define in detail the internal controls, strategies and processes for managing risks covered under the ERMP. Specific ROC responsibilities are outlined in detail in the ERMR.

4.4. Front Office (Planning and Procurement)
The Front Office is responsible for resource planning and procuring resources to meet the Attachment Consent Item 8B
Energy Risk Management Policy
7 physical, financial and contractual requirements of Ava, with load/resource balancing provisions and such other arrangements as may be approved by the Board in the future. The function includes contract administration, managing the risk assumptions for electricity transactions, including physical and financial needs analyses, energy purchases and sales, procurements of capacity, ancillary services and coordinating energy delivery scheduling. The Front Office is responsible to ensure that the procedures and processes needed to transact business within the ERMP are in place and they perform all duties related to actual transacting in the wholesale energy markets. The Front Office is the primary interface with potential wholesale transacting counterparties. The Chief Executive Officer and Head of Power Resources are responsible for managing the Front Office and can be supported by qualified third party suppliers. Front Office activities and detailed responsibilities are outlined in the ERMR.

4.5. Middle Office Controls and Reporting
The duties of the Middle Office will be conducted by the Finance Department, and/or are supported by a qualified third-party supplier. Its primary purpose is to manage risk oversight and controls. The Middle Office provides independent oversight of the risks assumed by the Front Office in the course of transacting energy products and services. The Middle Office must be independent from the Front Office functions. The Head of Finance is responsible for managing the Middle Office. Detailed responsibilities of the Middle Office are described in the ERMR.

4.6. Back Office (Settlements and Recording)
The Back Office is primarily responsible for settlement of bills, recording transactions, bookkeeping and accounting, and contract compliance. It is responsible for providing assurance of accurate transaction records and settlements. Back Office functions are conducted by personnel in the Finance Department, and/or are supported by a qualified third-party supplier.

Detailed responsibilities of the Back Office are described in the ERMR.

4.7. Auxiliary Functions
Additional issues impacting the overall power supply and risk management program include establishment of financial reserve requirements, which are generated by auxiliary support functions in the Finance Department.

The Finance Department is responsible for preparation of the budget and the calculation of rates used to bill customers for their related power supply usage. In addition, the Finance Department is responsible for establishment of necessary reserve levels for the various projects owned by Ava, if any, and for the Ava in general. The Finance Department is also responsible for establishment of reserves necessary for credit risks related to counterparty credit as mentioned in the ERMP, but as more clearly defined in the ERMR.

4.8. Authorities, Delegations, Limits and Prohibitions
All executed transactions shall conform to the policies set forth herein. It shall be the responsibility of the ROC, with approval of the Chief Executive Officer, to establish appropriate Attachment Consent Item 8B
Energy Risk Management Policy
8 individual transacting authority limits for the various personnel involved in the Front Office function. All staff with designated responsibility for Middle Office or Back Office functions are strictly prohibited from executing any wholesale transactions. The Middle Office shall be responsible for informing counterparties of such approved authorizations, including transacting authority and restrictions, along with product types and/or term and dollar limits.

5. Policy Compliance

5.1. Compliance Exceptions
Compliance exceptions are actions which violate the authority limits or directives set forth herein or in the ERMR as developed and adopted pursuant hereto by the ROC.

5.2. Reporting of Exceptions
The Chief Executive Officer shall notify the ROC of exceptions to mandated policies, procedures and regulations within 48 hours after they are identified, and ensure Front Office prepare a full report for review and discussion at the next ROC meeting.

5.3. Audit
Compliance with this ERMP and with the specific ERMR requirements instituted pursuant to this ERMP, shall be subject to examination by Ava’s independent auditors or by such other reviewers that Ava or ROC may appoint to evaluate the effectiveness of mandated controls.

5.4. Reserves
The ROC and the Chief Executive Officer, or his/her designee, are responsible for ensuring adequate reserves for energy price exposure and credit losses are maintained by Ava. The reserve estimate methodology, as established by the Finance Department, shall be reviewed and approved as needed to ensure appropriate reserve levels are maintained and funded.

5.5. Systems, Tools and Training
Ava employees who are authorized to perform energy risk management functions on behalf of Ava shall be provided with the necessary systems and tools to support all risk management processes.

Provision shall be made in the budgets submitted for each division which performs market risk management functions on behalf of Ava for the acquisition and maintenance of computer systems, software, communications equipment, data services and other analytical, measurement and reporting tools.

Provision shall also be made in the budgets submitted for each Ava division/department which performs market risk management functions on behalf of Ava for managers and staff to attend seminars and courses in risk management on a regular basis.

Attachment Consent Item 8B
Item 10 A
Energy Risk Management Policy
Version 21.0
Approved
July 16February , 2025DATE
Attachment Consent Item 8C
Energy Risk Management Policy Item 10 A
i
Table of Contents

1. Philosophy, Objectives and Scope ....................................................................................... 1

1.1. Risk Philosophy ............................................................................................................... 1

1.2. Business Activities........................................................................................................... 1

1.3. Transacting Objectives..................................................................................................... 1

1.4. Scope of Policy................................................................................................................. 2

1.5. Applicability..................................................................................................................... 2

1.6. Policy Review and Amendments ..................................................................................... 3

2. Risk Strategy & Parameters................................................................................................ 3

2.1. Counterparty Risk Management....................................................................................... 3

2.2. Balanced Load.................................................................................................................. 3

2.3. Minimum Coverage Requirements .................................................................................. 3

2.4. Diversification of Portfolio .............................................................................................. 3

2.5. Purchase to Cover Load Serving Obligations - No Speculation ..................................... 4

2.6. Use of Derivatives and Financial Transactions................................................................ 4

3. Risk Controls......................................................................................................................... 4

3.1. Control Principles............................................................................................................. 4

3.2. Internal Controls............................................................................................................... 5

3.3. Segregation of Duties....................................................................................................... 5

3.4. Conflicts of Interest.......................................................................................................... 5

4. Roles, Responsibilities, & Organization.............................................................................. 5

4.1. EBCEAva Board of Directors.......................................................................................... 6

4.2. Executive DirectorChief Executive Officer .................................................................... 6

4.3. Risk Oversight Committee ............................................................................................... 6

4.4. Front Office (Planning and Procurement)........................................................................ 7

4.5. Middle Office Controls and Reporting............................................................................. 7

4.6. Back Office (Settlements and Recording)...................................................................... 87

4.7. Auxiliary Functions.......................................................................................................... 8

4.8. Authorities, Delegations, Limits and Prohibitions........................................................... 8

5. Policy Compliance................................................................................................................. 8

5.1. Compliance Exceptions.................................................................................................... 8

5.2. Reporting of Exceptions................................................................................................... 8

5.3. Audit............................................................................................................................... 98

5.4. Reserves ......................................................................................................................... 98

5.5. Systems, Tools and Training............................................................................................ 9 Attachment Consent Item 8C
Energy Risk Management Policy Item 10 A
1 1. Philosophy, Objectives and Scope
This Energy Risk Management Policy (ERMP) outlines the philosophies and objectives of East BayAva Community Energy (EBCEAva) Board of Directors (Board). The Energy Risk Management Regulations (ERMR) also adopted by EBCEAva expand on the roles, strategies, controls and authorities authorized in this policy to form a comprehensive energy risk management program. The ERMR shall be read in conjunction with this ERMP.

1.1. Risk Philosophy
The overall goal of this ERMP is to:
• Serve the participating jurisdictions’ needs subject to Board approved risk tolerance limits;
• Provide as much energy supply (generation and capacity) cost certainty for EBCEAva’s customers as possible while maintaining a least cost supply portfolio; and
• Enhance the value of EBCEAva’s assets to meet the financial goals and requirements of the participating jurisdictions.

As a joint powers authority, EBCEAva is in the business of generation, transmission and procurement of energy for the benefit of its participating jurisdictions. EBCEAva’s objective is to develop the least cost supply portfolio to meet load requirements of its customers, while maximizing revenues from sales of surplus energy, capacity and other wholesale energy and transmission services (e.g. resource optimization). However, unlike a private-sector entity, EBCEAva’s primary purpose in the power supply business is to serve its customers. EBCEAva’s goal is to be a cost hedger for its participating jurisdictions’ load and, is therefore,therefore, is precluded by this policy from engaging in speculative activities typical to many organizations orientated toward profit maximization.

EBCEAva management recognizes that certain risks are incidental to normal power supply operations and hedging activities. EBCEAva’s goal is to avoid unnecessary risk and to limit, to the extent practicable, any risks associated with normal cost-hedging activities. This document serves as a vehicle to describe and define the limits for activities considered as appropriate for EBCEAva in a normal course of business.

1.2. Business Activities
A primary part of EBCEAva’s main business is to procure or produce power supplies, capacity, and reserves to meet its customer load requirements. The resource (capacity/energy) supply portfolio may consists of physical assets, such as power plants and distributed energy resources, fixed and variable priced supply contracts of varying lengths, and agreements for other related supplies and services needed to ensure reliable delivery of electricity to EBCEAva’s customers.

1.3. Transacting Objectives
Attachment Consent Item 8C
Energy Risk Management Policy Item 10 A
2 EBCEAva’s overall transacting objective is to meet the load requirements of its customers with an optimized resource supply portfolio. EBCEAva’s objectives when transacting on behalf of its customers for the procurement of energy and energy related supplies and services are as follows:
• Meet customer load requirements including energy, capacity and reserves; • Provide stable rates for the participating jurisdictions; • Obtain the best available price for power supply while complying with the requirements of this policy and other objectives established by the Board (e.g. renewable energy policy goals);
• Manage EBCEAva’s assets to optimize value;
• Act to limit exposure to extreme market system changes; • Follow effective wholesale counterparty credit management procedures; and • Develop and maintain EBCEAva’s investment grade credit rating.

1.4. Scope of Policy
This ERMP addresses risks arising from EBCEAva’s participation in the wholesale energy markets, and applies to all energy and energy related transactions made by EBCEAva. This ERMP does not address the following types of general property and casualty business risk: fire, accident and casualty; health, safety, and workers’ compensation; general liability; and other such typically insurable perils. The term “risk management,” as used herein, is therefore understood to refer solely to risks related to participation in wholesale energy markets as herein defined.

EBCEAva is exposed to three quantifiable risks: load and resource variability (volumetric), cost variability (price), and counterparty credit risk. From the perspective of risk mitigation, EBCEAva’s primary objective is to cover load and optimize the value of assets. Taking risks in order to arbitrage market opportunities, or risks unrelated to EBCEAva’s normal power supply business activities, is not permitted.

EBCEAva is also exposed to regulatory and operational risks. However, these exposures are not quantifiable as they affect structural change. As a result, these risk categories are managed as separate enterprise risk exposures and are not directly governed by this ERMP.

This ERMP prescribes the management organization, authority and processes to monitor, measure and control the risks to which EBCEAva is exposed in the normal course of business.

Specific methodologies used to measure, monitor and control these risks shall be established by the Executive DirectorChief Executive Officer ’s Risk Oversight Committee (ROC), in accordance with sound utility practices and included in the ERMR.

1.5. Applicability
This ERMP is effective immediately upon its adoption by the Board. It applies to EBCEAva’s wholesale supply operations, long-term contracting for energy/capacity and services, acquisition of generation resources, credit risk management and other related ancillary activities undertaken by EBCEAva.

Attachment Consent Item 8C
Energy Risk Management Policy Item 10 A
3 1.6. Policy Review and Amendments
Prudence is required in implementing any and all policies and procedures. Market and industry norms, technology and risk tolerances tend to change over time. Therefore, this policy should be reviewed as needed, in order to make adjustments in response to changes in business objectives and/or industry norms. Amendments to this ERMP shall be done only by approved Resolution of the Board.

2.1. Counterparty Risk Management
Counterparty risk is defined as the exposure to economic loss resulting from default by a party to a contract (e.g., a counterparty). Counterparty risk affects both contracts requiring physical settlement and those specifying monetary settlement. For all fixed price energy transactions, the counterparty must possess at least a BBB- (or equivalent investment grade rating) by a nationally recognized statistical rating organization (NRSRO). EBCEAva staff may consider counterparties with a rating below investment grade, or a counterparty without a NRSRO rating on a case-by-case basis, with the approval of the ROC.

Effective wholesale counterparty management and credit analysis is essential to mitigate the counterparty risks associated with commodity transactions in the energy markets. The objective is to preserve EBCEAva’s capital, liquidity, and supply reliability by limiting counterparty credit risk and supplier concentration to acceptable levels. Methodologies to achieve this objective are set forth in the ERMR.

2.2. Balanced Load
EBCEAva shall maintain an integrated and balanced portfolio of resources to cover its customer load within a dual volume and cost-at-risk framework.

2.3. Minimum Coverage Requirements
EBCEAva shall establish minimum coverage requirements, combined with defined cost-at-risk metrics, for capacity and energy as determined by the ROC and outlined in the ERMR.

2.4. Diversification of Portfolio
EBCEAva shall strive to develop a resource portfolio that includes diversification in fuel type, contract duration, geographic location, counterparty, pricing terms, cash reserves and types of products.

Attachment Consent Item 8C
Energy Risk Management Policy Item 10 A
4 2.5. Purchase to Cover Load Serving Obligations - No Speculation As discussed in Section 1.3, EBCEAva’s overall objective for energy procurement activities is to cover the load serving obligations of its customers. In the course of performing these activities, EBCEAva shall not engage in activities that expose its participating jurisdictions to speculative transactional risks, and shall only utilize approved transaction parameters as determined by the ROC and outlined in the ERMR.

2.6. Use of Derivatives and Financial Transactions
Use of financial derivatives or transactions (as opposed to physical or “embedded” options) is allowed in limited circumstances by EBCEAva. These include transactions used to set price caps and floors, or hedge against load/price volatility. Examples include:
• Exchange traded Puts and Calls;
• Electric Futures;
• Electric Options; and
• Weather Derivatives.

3. Risk Controls

3.1. Control Principles
EBCEAva will strive to conduct its energy risk management activities in accordance with best practices of the energy industry, but implementing such practices must be cost justified and balanced between costs and benefits. Processes and control systems must be in place that allow EBCEAva to identify, measure, monitor, control and track its risk exposures. These processes and control systems shall include the following risk management control principles:
• Appropriate segregation of duties and internal controls will be used; • Appropriate systems to ensure accurate and effective management reporting; • Necessary resources in place to achieve management objectives; • Attract and retain skilled and trained personnel;
• Cross-train and provide cross coverage;
• Employees conducting energy transactions are free of conflicts of interest; • Authority and approval delegation is commensurate with accountability and capability;
• Performance measurement and reporting incorporate risk and return measures; and • Ongoing monitoring of control effectiveness.

Attachment Consent Item 8C
Energy Risk Management Policy Item 10 A
5 3.2. Internal Controls
Internal controls shall be based on proven principles that meet the stringent requirements of generally accepted auditing standards (GAAS), financial institutions and credit rating agencies.

3.3. Segregation of Duties
Responsibilities related to energy transacting shall be segregated in a manner consistent with the control principles listed above by means of clearly defined roles and responsibilities for the Front Office, Middle Office and Back Office operations. Such roles and responsibilities can also be provided by a qualified third -party services provider. Specific roles, responsibilities and organizational structure of these functions are outlined in Section 4 of the ERMP.

These controls shall be fully integrated into all business activities of EBCEAva, and there shall be active participation by senior management in risk management processes.

3.4. Conflicts of Interest
All EBCEAva employees who are engaged in energy supply resource transactions, counterparty credit evaluation, or oversight of the foregoing and are employed in any job classification listed in the EBCEAva Conflict of Interest Code are required to complete annual conflict of interest filings on FPPC Form 700 and disclose investments as required by that code.

In addition to the foregoing disclosure requirement, EBCEAva employees engaged in energy supply resource transactions, counterparty credit evaluation or oversight of the foregoing, are barred from investing in any company with whom EBCEAva has consummated energy or related purchases or sales within the last two years.

EBCEAva employees supervising staff who are subject to this policy are responsible for routinely reviewing Form 700 of each such staff member for the purpose of identifying potential financial conflicts of interest. General Counsel will assist in reviewing these forms and providing legal advice in connection with such reviews upon request.

4. Roles, Responsibilities, & Organization
Attachment Consent Item 8C
Energy Risk Management Policy Item 10 A
6 This section of the ERMP defines the overall roles and responsibilities for implementation of this ERMP. The coordinated efforts of personnel across several divisions are required to successfully implement EBCEAva’s risk management program. Section 4 of the ERMP outlines the basic roles and responsibilities of each organizational function. Specific details and the specific roles and responsibilities of the oversight and operational divisions within the energy risk management program structure at EBCEAva are outlined in the ERMR, as developed by the ROC and revised from time to time.

4.1. EBCEAva Board of Directors
The Board has the ultimate oversight over EBCEAva operations and is responsible for establishing an organizational-wide framework for risk management and ensuring that risk management results are achieved as planned. The Board shall approve and establish organizational policies for risk management and delegate to the Executive DirectorChief Executive Officer the responsibility for implementing the ERMP. With responsibility for the ultimate oversight over EBCEAva operations, the Board shall be responsible to insureensure the risk management results are achieved in accordance with the ERMP.

4.2. Executive DirectorChief Executive Officer
The Executive DirectorChief Executive Officer has overall responsibility for implementing the ERMP and for communicating risk management issues to the Board. The Executive DirectorChief Executive Officer shall be responsible for delegating specific duties for carrying out the policy and insuring compliance with it by all affected EBCEAva employees or contractors. The Board acknowledges that the Executive DirectorChief Executive Officer shall established the ROC as a member/staff function and may delegated certain functions to the ROC, which delegation is ratified by this ERMP.

4.3. Risk Oversight Committee
The Risk Oversight Committee (ROC) is responsible for overseeing compliance with risk management policies within EBCEAva. The ROC serves as the highest level of organizational risk management reporting to the Executive DirectorChief Executive Officer . The ROC shall consist of at least five (5) members including EBCEAva Management, participating jurisdictional representatives and EBCEAva’s legal counsel, as designated by the Executive DirectorChief Executive Officer from time to time. A quorum for the ROC to do business shall be not less than three a simple majority of Committee members (including not less than one participating jurisdictional representative) or their designees.

The two participating jurisdictional representatives shall be appointed to the ROC by the Executive Director. These participating jurisdictional representatives shall reflect the diversity of EBCE’s customers (including larger and smaller jurisdictions). The participating jurisdictions may nominate potential ROC members. The Executive DirectorChief Executive Officer shall select ROC representatives based on those recommendations in his or her sole discretion.

Each ROC member shall have one vote, and may appoint a voting alternate with the approval of Attachment Consent Item 8C
Energy Risk Management Policy Item 10 A
7 the Executive DirectorChief Executive Officer . Participating jurisdictions not represented on the ROC may send representatives to attend ROC meetings and participate in ROC discussions subject to the approval of the Chief Executive Officer; however, these non-ROC participants will have no voting rights.

The ROC will meet at least quarterly, to act on the responsibilities mentioned above. Individual participating jurisdictions may request the ROC to convene in a timely fashion if ROC approval is required for any transaction affecting EBCE. Minutes to each meeting will be maintained according to EBCE policy.

The ROC shall make regular reports to the Board regarding business transacted by the ROC at such intervals as the Board shall direct.

The CEO ROC ROC shall have the responsibility for monitoring ensuring that business is conducted in accordance with the ERMP and advising the CEO, with the assistance of the ROC.

The ROC shall adopt and keep current “Energy Risk Management Regulations,” which shall define in detail the internal controls, strategies and processes for managing risks covered under the ERMP. Specific ROC responsibilities are outlined in detail in the ERMR.

4.4. Front Office (Planning and Procurement)
The Front Office is responsible for resource planning and procuring resources to meet the physical, financial and contractual requirements of EBCEAva, with load/resource balancing provisions and such other arrangements as may be approved by the Board in the future. The function includes contract administration, managing the risk assumptions for electricity transactions, including physical and financial needs analyses, energy purchases and sales, procurements of capacity, ancillary services and coordinating energy delivery scheduling. The Front Office is responsible to ensure that the procedures and processes needed to transact business within the ERMP are in place and they perform all duties related to actual transacting in the wholesale energy markets. The Front Office is the primary interface with potential wholesale transacting counterparties. The Executive DirectorChief Executive Officer and HeadDirector of Power Resources are responsible for managing the Front Office, and can be supported by qualified third party suppliers. Front Office activities and detailed responsibilities are outlined in the ERMR.

4.5. Middle Office Controls and Reporting
The duties of the Middle Office will be conducted by the Finance and Administrative Services Department, and/or are supported by a qualified third- party supplier. Its primary purpose is to manage risk oversight and controls. The Middle Office provides independent oversight of the risks assumed by the Front Office in the course of transacting energy products and services. The Middle Office must be independent from the Front Office functions. The Director Head of Finance and Administrative Services is responsible for managing the Middle Office. Detailed responsibilities of the Middle Office are described in the ERMR.

Attachment Consent Item 8C
Energy Risk Management Policy Item 10 A
8 4.6. Back Office (Settlements and Recording)
The Back Office is primarily responsible for settlement of bills, recording transactions, bookkeeping and accounting, and contract compliance. It is responsible for providing assurance of accurate transaction records and settlements. Back Office functions are conducted by personnel in the Finance and Administrative Services Department, and/or are supported by a qualified third -party supplier. Detailed responsibilities of the Back Office are described in the ERMR.

The Finance and Administrative Services Department is responsible for preparation of the budget and the calculation of rates used to bill customers for their related power supply usage. In addition, the Finance and Administrative Department is responsible for establishment of necessary reserve levels for the various projects owned by EBCEAva, if any, and for the EBCEAva in general. The Finance and Administrative Services Department is also responsible for establishment of reserves necessary for credit risks related to counterparty credit as mentioned in the ERMP, but as more clearly defined in the ERMR.

4.8. Authorities, Delegations, Limits and Prohibitions
All executed transactions shall conform to the policies set forth herein. It shall be the responsibility of the ROC, with approval of the Executive DirectorChief Executive Officer , to establish appropriate individual transacting authority limits for the various personnel involved in the Front Office function. All staff with designated responsibility for Middle Office or Back Office functions are strictly prohibited from executing any wholesale transactions. The Middle Office shall be responsible for informing counterparties of such approved authorizations, including transacting authority and restrictions, along with product types and/or term and dollar limits.

5. Policy Compliance

5.1. Compliance Exceptions
Compliance exceptions are actions which violate the authority limits or directives set forth herein or in the ERMR as developed and adopted pursuant hereto by the ROC.

5.2. Reporting of Exceptions
The Executive DirectorChief Executive Officer shall notify the ROC of exceptions to mandated policies, procedures and regulations within 48 hours after they are identified, and ensure Front Office prepare a full report for review and discussion at the next ROC meeting.

Attachment Consent Item 8C
Energy Risk Management Policy Item 10 A
9 5.3. Audit
Compliance with this ERMP and with the specific ERMR requirements instituted pursuant to this ERMP, shall be subject to examination by EBCEAva’s independent auditors or by such other reviewers that EBCEAva or ROC may appoint to evaluate the effectiveness of mandated controls.

5.4. Reserves
The ROC and the Executive DirectorChief Executive Officer , or his/her designee, are responsible for ensuring adequate reserves for energy price exposure and credit losses are maintained by EBCEAva. The reserve estimate methodology, as established by the Finance and Administrative Services Department, shall be reviewed and approved as needed to ensure appropriate reserve levels are maintained and funded.

5.5. Systems, Tools and Training
EBCEAva employees who are authorized to perform energy risk management functions on behalf of EBCEAva shall be provided with the necessary systems and tools to support all risk management processes.

Provision shall be made in the budgets submitted for each division which performs market risk management functions on behalf of EBCEAva for the acquisition and maintenance of computer systems, software, communications equipment, data services and other analytical, measurement and reporting tools.

Provision shall also be made in the budgets submitted for each EBCEAva division/department which performs market risk management functions on behalf of EBCEAva for managers and staff to attend seminars and courses in risk management on a regular basis.

Attachment Consent Item 8C

Consent Item 9
Consent Item 9
To: Ava Community Energy Authority
From: Russell Mills, Chief Financial Officer & Treasurer Subject: Presenting the Treasurer’s Report for Fiscal Year 2024-2025 Q4 (Informational Item)
Date: July 16, 2025
Summary/Recommendation
Receive report on Ava’s cash position.

Background and Discussion
For the quarter ending June 30, 2025, Ava has maintained a positive cash balance on all Ava bank accounts. Below is a summary of account balances, cash received, and outstanding loan balances.

Account Balances as of 6/30/2025
Accounts Held Amount
River City Accounts
Operating
Internal Operating $ 4,353,910
Operating Fund $ 84,563,179
Lockbox $ 18,826,078
Interest Bearing
Money Market $ 58,406,576
Insured Cash Sweep Checking $ 88,381,011
Insured Cash Sweep Saving $ 5,053,813
CDARS $ 50,000,000
US Bank
Checking $ 56,832,118
Custodial $ 343,570,019
Wells Fargo
Security Margin $ 432,979
Total $ 710,419,683
Consent Item 9
Cash Received by Month into Lockbox Account
Outstanding Loan Balances:

US Bank Credit Facility: $0.00
Customer Delinquency:

As of June 30, 2025
31 – 60 Days: $ 5,102,867
61 – 90 Days: $ 3,677,088
91 - 120 Days: $ 3,274,441
120+ Days: $ 48,488,427
April 2025 $ 69,044,422
May 2025 $ 63,369,847
June 2025 $ 67,761,967
Total $ 200,176,237
Consent Item 10
Consent Item 10
To: Ava Community Energy Authority
From: Jason Bartlett, Senior Finance Manager
Subject: Fiscal Year 2024-2025 Q3 Financial Statements
Date: July 16, 2025
__________________________________________________________________ Summary/Recommendation
This memo updates the Board on Ava’s financial position as of March 31, 2025.

Financial Impact
This is an informational item
Analysis and Context
Ava’s current fiscal year (FY) runs from July 1, 2024, through June 30, 2025. Financial position statements are generated every quarter, and are audited annually by a third party. The financial statements presented today represent Ava’s financial position and activity for the quarter ending March 31, 2025 and the FY to date. These statements are prepared by Ava’s accountant, Maher Accountancy.

Committee Recommendation
The Finance Administrative and Procurement Committee has reviewed these statements without comment.

Attachments
A. Fiscal Year 2024-2025 Q3 Financial Statements
1 ACCOUNTANTS’ COMPILATION REPORT
Board of Directors
AVA Community Energy
Management is responsible for the accompanying financial statements of AVA Community Energy (a California Joint Powers Authority) which comprise the statement of net position as of March 31, 2025, and the related statements of revenues, expenses, and changes in net position, and the statement of cash flows for the three months and nine months then ended in accordance with accounting principles generally accepted in the United States of America. We have performed a compilation engagement in accordance with Statements on Standards for Accounting and Review Services promulgated by the Accounting and Review Services Committee of the AICPA. We did not audit or review the accompanying statements nor were we required to perform any procedures to verify the accuracy or completeness of the information provided by management. Accordingly, we do not express an opinion, conclusion, nor provide any assurance on these financial statements.

Management has elected to omit substantially all of the note disclosures required by accounting principles generally accepted in the United States of America in these interim financial statements.

AVA Community Energy’s annual audited financial statements include the note disclosures omitted from these interim statements. If the omitted disclosures were included in these financial statements, they might influence the user’s conclusions about the Authority’s financial position, results of operations, and cash flows. Accordingly, these financial statements are not designed for those who are not informed about such matters.

We are not independent with respect to the Authority because we performed certain accounting services that impaired our independence.

Maher Accountancy
San Rafael, CA
June 6, 2025
1101 Fifth Avenue, Suite 200 San Rafael, CA 94901 415 459 1249 mahercpa.com Attachment Consent Item 10A
Current assets
Cash and cash equivalents - unrestricted $ 347,133,805
Cash and cash equivalents - restricted 4,486,257
Accounts receivable, net of allowance 71,603,581
Accrued revenue 38,912,044
Other receivables 5,123,810
Prepaid expenses 3,477,847
Deposits 3,918,125
Investments 39,653,617
Total current assets 514,309,086
Noncurrent assets
Cash and cash equivalents in Rate Stabilization Fund - unrestricted 57,597,693 Deposits 1,075,786
Investments 297,288,479
Loan receivable 2,104,299
Capital assets, net of depreciation and amortization 9,732,613 Total noncurrent assets 367,798,870
Total assets 882,107,956
Current liabilities
Accrued cost of electricity 159,183,829
Accounts payable 4,616,860
Advances from grantors 4,486,257
Other accrued liabilities 1,749,275
User taxes and energy surcharges due to other governments 7,983,278 Security deposits - energy suppliers 7,209,453
Total current liabilities 185,228,952
Noncurrent liabilities
Security deposits - energy suppliers 3,600,000
Total liabilities 188,828,952
Rate Stabilization Fund 57,597,693
Net investment in capital assets 9,732,613
Unrestricted 625,948,698
Total net position $ 635,681,311

NET POSITION

AVA COMMUNITY ENERGY

STATEMENT OF NET POSITION
As of March 31, 2025
ASSETS

LIABILITIES

DEFERRED INFLOWS OF RESOURCES
See accountants' compilation report. 2
Attachment Consent Item 10A
Three Months Year-to-Date

OPERATING REVENUES
Electricity sales, net 174,362,333$ $ 657,775,110
Revenue directed from Rate Stabilization Fund 22,319,294 22,319,294 Liquidated damages 464,475 10,041,975
Grant revenue 1,209,625 2,696,073
Other operating revenues 160,588 279,225
Total operating revenues 198,516,315 693,111,677

OPERATING EXPENSES
Cost of electricity 210,329,690 570,268,195
Contract services 6,081,136 17,912,902
Staff compensation 5,413,542 15,059,174
Other operating expenses 2,121,747 6,011,589
Depreciation and amortization 219,914 678,220
Total operating expenses 224,166,029 609,930,080
Operating income (loss) (25,649,714) 83,181,597

NONOPERATING REVENUES (EXPENSES)
Investment income 8,978,872 17,194,082
Interest expense (4,043) (28,399)
Nonoperating revenues (expenses), net 8,974,829 17,165,683 CHANGE IN NET POSITION (16,674,885) 100,347,280
Net position at beginning of period 652,356,196 535,334,031 Net position at end of period $ 635,681,311 $ 635,681,311

AVA COMMUNITY ENERGY

STATEMENT OF REVENUES, EXPENSES

AND CHANGE IN NET POSITION
Nine Months Ended March 31, 2025
See accountants' compilation report. 3
Attachment Consent Item 10A
Three Months Year-to-Date

CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers $ 202,595,026 $ 720,023,592
Receipts of supplier security deposits 1,857,704 5,789,956 Other operating receipts 630,739 10,792,476
Payments to suppliers for electricity (216,072,885) (556,879,191) Payments for other goods and services (6,723,316) (24,274,712) Payments for staff compensation (5,427,689) (15,005,451) Payments for deposits and collateral (3,406,878) (12,300,878) Payments of taxes and surcharges to other governments (8,388,975) (26,310,264) Net cash provided by operating activities (34,936,274) 101,835,528

CASH FLOWS FROM CAPITAL AND RELATED

FINANCING ACTIVITIES
Payments of lease liability (256,702) (737,014)
Purchases of capital assets - (87,745)
Net cash (used) by capital and related financing activities (256,702) (824,759)

CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from sales and maturities of investments 60,977,683 60,982,046 Principal payments of loan received 83,736 90,962
Investment income received 5,603,624 12,751,520
Purchase of investments (75,973,828) (395,146,269)
Loan issued (2,057,344) -
Net cash provided (used) by investing activities (9,308,785) (323,379,085) Net change in cash and cash equivalents (44,501,761) (222,368,316) Cash and cash equivalents at beginning of period 453,719,516 631,586,071 Cash and cash equivalents at end of period $ 409,217,755 $ 409,217,755 Reconciliation to the Statement of Net Position
Cash and cash equivalents - unrestricted (current) $ 347,133,805 $ 347,133,805 Cash and cash equivalents - restricted (current) 4,486,257 4,486,257 Cash and cash equivalents (noncurrent) 57,597,693 57,597,693 Cash and cash equivalents $ 409,217,755 $ 409,217,755
Nine Months Ended March 31, 2025

STATEMENT OF CASH FLOWS

AVA COMMUNITY ENERGY
See accountants' compilation report. 4
Attachment Consent Item 10A
Three Months Year-to-Date
Operating income (loss) (25,649,714)$ $ 83,181,597
Adjustments to reconcile operating income to net
cash provided (used) by operating activities
Depreciation and amortization expense 219,914 678,220
(Increase) decrease in:

Accounts receivable 13,263,131 13,359,235
Other receivables (2,193,568) (2,950,142)
Accrued revenue 6,720,203 22,040,349
Prepaid expenses 1,190,120 (652,306)
Deposits 294,000 2,225,232
Increase (decrease) in:

Accrued cost of electricity (5,635,149) 9,884,320
Accounts payable 1,422,525 (795,948)
Other accrued liabilities 10,073 69,798
Advances from grantors (3,529,649) (4,565,894)
Deferred revenue (51,958) (1,738,936)
User taxes due to other governments (139,612) 538,641
Security deposits from energy suppliers 1,462,704 2,880,656 Rate Stabilization Fund (22,319,294) (22,319,294)
Net cash provided (used) by operating activities $ (34,936,274) $ 101,835,528

NONCASH INVESTING ACTIVITIES
Unrealized appreciation (depreciation) and
timing differences in investment income $ 3,375,248 $ 4,442,562

RECONCILIATION OF OPERATING INCOME TO NET

CASH PROVIDED (USED) BY OPERATING ACTIVITIES
Nine Months Ended March 31, 2025
STATEMENT OF CASH FLOWS (Continued)

AVA COMMUNITY ENERGY
See accountants' compilation report. 5
Attachment Consent Item 10A
CEO Report Item 11
CEO Report Item 11
TO: Ava Community Energy Board of Directors
FROM: Howard Chang, Chief Executive Officer
SUBJECT: CEO Report (Informational Item)
DATE: July 16, 2025
________________________________________________________________________ Recommendation
Accept Chief Executive Officer (CEO) report on update items below.

Executive Committee Meeting
An Executive Committee Meeting was held on Wednesday, July 2, 2025. Members received an update on the draft budget for FY 2025-26 and a follow up on the upcoming prepay transaction.

The next meeting will be held on Wednesday, September 3, 2025 at 3:30 pm. This meeting will be held at the following temporary location:

Rotunda Building
300 Frank Ogawa Plaza,
Oakland, CA 94612
Marketing Regulatory and Legislative Subcommittee Meeting The June 20, 2025 Marketing Regulatory and Legislative Subcommittee Meeting was cancelled.

The next Marketing, Regulatory and Legislative Subcommittee meeting will be held on Monday, July 21, 2025 at 3:30 pm. This meeting will be held at the following temporary location:

The Port Workspaces
3rd Floor, Large Conference Room
344 20th St
Oakland, CA 94612
Financial, Administrative and Procurement Subcommittee Meeting A Financial, Administrative and Procurement subcommittee meeting was held on July 9, 2025.

Members received updates on the FY 2025-26 Annual Audit, FY 2024-25 Q3 Draft Financial Statements, Energy Risk Management Policy, Compliance Period Procurement Methodology and the Procurement Policy. The next Financial, Administrative and Procurement Subcommittee meeting will be held on September 8, 2025 at the following temporary location:

Rotunda Building
300 Frank Ogawa Plaza,
Oakland, CA 94612
New Employees
CEO Report Item 11
Aaron Crosman - Salesforce Director
Aaron joined Ava on June 17, 2025 to serve as our Salesforce Director. He will be leading the Salesforce team to ensure that it has a clear strategic vision and evolving technical roadmap, and that Ava is getting the most from its Salesforce investment.

Aaron started his career with a decade of work in IT and Communications for a nonprofit organization, before moving into consulting for a little more than the next decade – including 7 years as a Salesforce developer and implementation consultant. He has experience in all aspects of digital marketing, and in helping organizations align their technology to their mission.

In addition to having more than a dozen Salesforce certifications, in 2023 Salesforce inducted Aaron into their MVP program – a recognition of technical skill and community leadership.

Salesforce confirmed his renewal in that program at the end of June. Aaron has a B.A. in Computer Science from Hamilton College.

Stacy Orr - Marketing Campaign Manager
Stacy joined Ava on June 17, 2025 as the Marketing Campaign Manager. She will be supporting the creation and launch of marketing campaigns and activations for Ava's community programs (Ava Charge) and brand marketing.

Before joining Ava, Stacy spent 3.5 years at mission-driven edTech company, Udemy, where she developed and launched over 15 global-scale consumer campaigns such as quarterly sales, consumer stories, and new product launches. Prior to that, she worked in franchising developing the local marketing strategy for new and existing franchises in indoor pickleball and indoor trampoline parks. Stacy has a MBA from University of Southern California with an emphasis in marketing.

Other Updates
Ava Bike Electric Program Launch
Ava Bike Electric launched on July 7 and is one of the largest e-bike programs in the U.S. as we expect to incentivize 8,200 to 9,200 new e-bikes through December 2026. This $10 Million program is funded with $6 Million from Ava and a $4 Million grant from the Alameda County Transportation Commission. As a result of this grant funding, Ava Bike Electric participation is open to non-Ava customers in Alameda County, along with all Ava customers across our service area. E-bike incentives range from $400 to $1,500. 40% of e-bike incentive funds are dedicated to income qualified participants with a higher e-bike incentive for those participants, as well as a $250 safety equipment rebate.

As of July 10, over 600 people applied to the program ahead of our first monthly random drawing to distribute incentives on July 22. Ava will hold a monthly random drawing on the 4th Tuesday of every month through September 2026.

As a reminder, Ava employees, members or alternates of the Ava Board or any committee, including the Community Advisory Committee, are not eligible to participate in this program, nor are the families of anyone in those roles.

Joint Rate Mailer
Ava, in collaboration with PG&E, sent via email or postcard, the annual Joint Rate Mailer. This CPUC-required piece provides all eligible CCA customers with a sample comparison of rates and average monthly bills, as well as the draft Power Content Label. This year’s mailers were sent to customers the week of June 23. Few customers contacted Ava with questions, as they CEO Report Item 11
have received a similar document every year since 2019. Ava mailed over 130,000 postcards and sent 645,000 emails. A sample postcard is shown below.

Fremont default product transition to Renewable 100
Ava continues to prepare for Fremont’s residential default product transition to Renewable 100 in August through community outreach, including:

CEO Report Item 11
• The first of two Renewable 100 enrollment notices were sent to customers (via mail and email) the week of June 24
• Staff participated in Fremont’s 6/5 Sustainability Commission meeting • Staff held two separate training sessions with the City’s Sustainability Commissioners • Staff attended the City’s Pride Fair at the Fremont Library • Announcement in Ava’s Direct Current Newsletter (June) • Ongoing announcements via social media, online & print advertising Fremont’s City staff are also conducting separate outreach, such as newsletters and social media, bolstered by Ava’s media guides and toolkit.

Fremont residents are receiving the message. Eight percent, or 5,800 residents eligible to transition to Renewable 100, have chosen to remain on Bright Choice, with over 95% of those selections coming through Ava’s online webform.

Tuesday, July 22nd is the last day by which Fremont customers can choose Bright Choice and avoid being enrolled in Renewable 100 automatically in August. Thereafter, customers may still choose Bright Choice, but they may see Renewable 100 charges for at least one billing cycle.

Ava in the Community
To raise awareness of our service, support our community, and stay close to our customers, Ava sponsors and staffs events throughout our service territory all year long. Stop by to say hello at any of these upcoming events between July 17 and September 17. Learn more at https://avaenergy.org/about-ava/meetings-events/events/ Date Event Location
7/17/2025 Hayward Downtown Street Party Downtown Hayward 7/18/2025 Stockton Ports vs. Fresno Grizzlies Banner Island Ballpark 7/25/2025 Stockton Ports vs Lake Elsinore Storm Banner Island Ballpark 7/26/2025 Oakland Roots vs Orange County SC Oakland Coliseum 8/2/2025 -
8/3/2025
Fremont Festival of the Arts Downtown Fremont
8/5/2025 Union City National Night out Union Landing
Shopping Center
8/5/2025 Lincoln Center – National Night Out Lincoln Center, Stockton
8/8/2025 Lathrop Family Fun Night Mossdale Park
8/9/2025 Family Fun Festival
Central United
Methodist Church,
Stockton
CEO Report Item 11
8/9/2025 Oakland Roots vs Colorado Springs
Switchbacks FC Oakland Coliseum
8/16/2025 -
8/17/2025 Fremont Festival of India Fremont
8/20/2025 Concerts in the Park Victory Park, Stockton
8/30/2025 Oakland Roots vs Monterey Bay FC
(Back to School Night) Oakland Coliseum
9/6/2025 Tracy Connects Lincoln Park
9/6/2025 Oakland Roots vs Pittsburgh Riverhounds
SC Oakland Coliseum
9/13/2025 San Leandro Oktoberfest
Downtown San
Leandro
9/14/2025 Albany Solano Stroll Albany High School

Staff Report Item 13
Staff Report Item 13
To: Ava Community Energy Authority
From: Izzy Carson, Power Resources Manager
Subject: Presenting Ava Compliance Period Procurement Methodology Date: 7/16/2025
__________________________________________________________________ Summary/Recommendation
This Staff Report proposes that Ava implement a compliance period procurement methodology for 2024-2027, 2028-2030, and 2031-2033 periods in order to provide flexibility to balance renewable and Greenhouse Gas free (GHG-free) procurement and to reduce costs.

Financial Impact
Utilizing over procurement from 2024 will reduce procurement costs in the initial 2024-2027 compliance period.

Analysis and Context
Ava discussed the concept of a multi-year procurement period for determining compliance to our agency’s voluntary clean energy procurement targets during the 2025-2026 budget.

Intermittent resources and variations in resource availability, as well as project development timelines, growth and market price fluctuations contribute to uncertainty and challenges to procurement planning. Over time and as Ava enters into additional long-term contracts, there is greater potential for over or under-procurement.

California’s Renewable Portfolio Standard (RPS) uses multi-year compliance periods as a mechanism to effectively increase renewables while providing flexibility and stability for retail sellers to meet renewable procurement targets. Utilizing a similar compliance period approach would allow Ava to average renewable and large hydro purchases over a longer period rather Staff Report Item 13
than being strictly limited to a single year, while still meeting voluntary clean energy procurement and compliance targets.

Ava recommends implementing compliance period methodology for the 2024-2027, 2028-2030, and 2031-2033 periods in order to align with RPS compliance periods, timing for emissions accounting methodology implementation, and to create a flexible balancing mechanism to reduce costs and manage procurement.

Committee Recommendation
This item was presented at the July 9 Finance, Administrative and Procurement Subcommittee meeting. The subcommittee was in support of the staff recommendation on this item.

Attachments
A. A Resolution of the Board of Directors of Ava Community Energy Authority Authorizing the Implementation of a Compliance Period Procurement Methodology B. Compliance Period Methodology Presentation
Attachment Staff Report Item 13A
RESOLUTION NO. R-2025-xx

A RESOLUTION OF THE BOARD OF DIRECTORS

OF AVA COMMUNITY ENERGY AUTHORIZING THE IMPLEMENTATION

OF A COMPLIANCE PERIOD PROCUREMENT METHODOLOGY
WHEREAS Ava Community Energy Authority (“Ava”) was formed as a community choice aggregation agency (“CCA”) on December 1, 2016, under the Joint Exercise of Powers Act, California Government Code sections 6500 et seq., among the County of Alameda, and the Cities of Albany, Berkeley, Dublin, Emeryville, Fremont, Hayward, Livermore, Piedmont, Oakland, San Leandro, and Union City to study, promote, develop, conduct, operate, and manage energy-related climate change programs in all of the member jurisdictions. The Cities of Newark and Pleasanton, located in Alameda County, along with the City of Tracy, located in San Joaquin County, were added as members of Ava and parties to the Joint Powers Agreement (“JPA”) in March of 2020. The City of Stockton was added as a member to Ava in September of 2022. The City of Lathrop was added as a member to Ava in October of 2023. San Joaquin County was added as a member to Ava in July 2024. On October 24, 2023, Ava legally adopted the name Ava Community Energy Authority, where it had previously used the name East Bay Community Energy Authority since its inception.

WHEREAS multi-year compliance periods provide flexibility and stability for retail sellers to meet procurement targets and reduce procurement costs; and WHEREAS Ava can apply a compliance period approach for determining compliance to our agency’s voluntary clean procurement targets.

NOW, THEREFORE, THE BOARD OF DIRECTORS OF AVA COMMUNITY ENERGY AUTHORITY DOES HEREBY RESOLVE AS FOLLOWS:

Section 1. The Board of Directors approves the implementation of a compliance period procurement methodology for the 2024-2027, 2028-2030, and 2031-2033 time periods.

ADOPTED AND APPROVED this 16th day of July, 2025.

Jack Balch, Chair
ATTEST:

Adrian Bankhead, Clerk of the Board
Ava Compliance Period
Procurement
Methodology
July 16, 2025
Attachment Staff Report Item 13B
Introduction
• Ava has discussed implementation of a multi-year
procurement period for determining compliance to our
agency's voluntary clean energy procurement targets
o The board preliminarily approved this concept in the
recent 25-26 budget
o This presentation provided implementation details to the FAP sub-committee on July 9
th
• Topics to be reviewed:
o Guaranteed Energy Production vs. Expected Energy
Overview and Challenges
o California Renewable Portfolio Standard (RPS)
Compliance Period Methodology Overview
o RPS Compliance Period 4 Comparison (PG&E and Ava)
o Benefits of a Compliance Period
o Ava Compliance Period Procurement Methodology
Scenarios
Attachment Staff Report Item 13B
Guaranteed Energy Production (GEP) vs.

Expected Energy (EE)
• Reflects the band between the minimum and
maximum
• Energy from variable resources is subject to
fluctuations based on weather patterns and
time of day, making it less predictable.
• The more contingent, as delivered projects in
the portfolio, the greater the band and therefore
greater potential for over procurement.
• GEP is included in Ava’s proforma as the EE
multiplied by a specific percentage based on
technology (85% solar and 75% wind).

Attachment Staff Report Item 13B
CA Compliance Period Procurement Methodology
• CA legislatively mandated Renewable Procurement
Standards (RPS) include Compliance periods of 3-4
years whereby load serving entities can bank/retire
RECs in different years relative to the generation
• Allows for management of variable resources like
renewable energy and hydro in meeting compliance
obligations while increasing procurement of ghg-free resources over an extended timeframe • Ava can apply a similar approach for voluntary
procurement targets with 3-4 year procurement
periods
• This methodology provides a tool in managing
finances in consideration of budget surplus and
deficit projections by creating a balancing
mechanism across the period
• Beyond 2030, LSEs have an ongoing 3-
year compliance period requirement that currently
maintains a 60% renewables target.
4 Attachment Staff Report Item 13B
RPS Compliance Period 4 Comparison
Attachment Staff Report Item 13B
Benefits of a Compliance Period
• The final 2024 Power Content Label is
shown to the right, reflecting total
renewables and large hydro of 96% for Ava
• PG&E procured 23% renewables utilizing
banked RECs to meet its RPS compliance
obligation for 2024
• PG&E's 2025 power content will change
significantly, likely with lower nuclear and
higher natural gas
• Hourly emissions accounting, required in
2028, will impact power content and
procurement needs and costs
• Compliance periods and banking allow LSEs to adjust procurement strategies based on factors like energy availability, contract availability, and project development timelines, and provides flexibility for LSEs to help manage price fluctuations and ensure a more stable renewable energy market. • Multi year compliance periods provide additional flexibility for retail sellers to meet renewable procurement targets. This approach allows LSEs to average renewable and large hydro purchases over a longer period rather than being strictly limited to a single year.

Attachment Staff Report Item 13B
Considerations
• It is anticipated that in 2028 a new 24x7 emissions accounting methodology will be implemented. The details of this methodology are in development and uncertain at this time.

There is potential that this implementation timeframe could be delayed. • Alignment with RPS
• Historically, procurement in the last year of an RPS compliance period is more expensive due to constrained supply relative to demand;
• Staggering a compliance period with RPS could give us additional flexibility (e.g. 2024- 2027)
• Staggering could also pose additional challenges depending on timing (e.g. should Ava's first year be aligned with the last year in an RPS period?) • Large hydro and nuclear are primarily sourced through allocations from PG&E and large hydro is subject to change
• With a 100% clean target goal starting in 2030, there is not a clear mechanism to balance procurement beyond 2030
Attachment Staff Report Item 13B
Compliance Period Procurement Methodology Scenarios
8 Bright Choice 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 Board Adjusted Target Procurement NA NA 68% 76% 81% 81% 81% 85% 90% 95% 100% Actuals (Renewables + Large Hydro) 55% 58% 71% 89% 96% TBD TBD TBD TBD TBD TBD Over/(Under) procurement % 1% 3% 3% 13% 15% (7.5%) (7.5%) TBD TBD TBD TBD Compliance Period Adjusted Target 73.5% 73.5%
Scenario 1: 2024-2026
Ava proposes implementing a procurement period for 2024-2026 or 2024-2027 to utilize over procurement from 2024 in future years. This would result in our Power Content Label being above and below procurement targets in certain years allowing staff to balance procurement levels based on new projects coming online, firm vs.

Contingent contracts, and optimal supply/pricing
• 2024-2026 compliance period 1
• 2027-2029 compliance period 2
• 2030-2032 compliance period 3
• Staggered with RPS periods
• 2028 new emissions methodology implementation in the middle of a compliance period • Scenario 1 is estimated have higher immediate savings in 2025 and 2026 Attachment Staff Report Item 13B
Compliance Period Procurement Methodology Scenarios
(Cont.)
Bright Choice 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 Board Adjusted Target Procurement NA NA 68% 76% 81% 81% 81% 85% 90% 95% 100% Actuals (Renewables + Large Hydro) 55% 58% 71% 89% 96% TBD TBD TBD TBD TBD TBD Over/(Under) procurement % 1% 3% 3% 13% 15% (5%) (5%) (5%) TBD TBD TBD Compliance Period Adjusted Target 76% 76% 80%
Scenario 2: 2024-2027
• 2024-2027 compliance period 1
• 2028-2030 compliance period 2
• 2031-2033 compliance period 3
• Aligns with RPS periods
• 2028 new emissions methodology implementation at start of a new compliance period • Scenario 2 is estimated to have potentially lower near-term savings in 2025 and 2026 Attachment Staff Report Item 13B
Compliance Period Procurement Methodology Scenarios
(Cont.)
Bright Choice 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 Board Adjusted Target Procurement NA NA 68% 76% 81% 81% 81% 85% 90% 95% 100% Actuals (Renewables + Large Hydro) 55% 58% 71% 89% 96% TBD TBD TBD TBD TBD TBD Scenario 3: 2025-2027
• 2025-2027 compliance period 1
• 2028-2030 compliance period 2
• 2031-2033 compliance period 3
• Aligns with RPS periods
• 2028 new emissions methodology implementation at start of a new compliance period • Scenario 3 has no immediate savings in reduced procurement costs but and aligns with RPS Actual procurement levels will be reported in Ava's annual Power Content Label and multi-period averages will be reported in the annual budget setting process.

Attachment Staff Report Item 13B
Attachment Staff Report Item 13B
Staff Report Item 14
Staff Report Item 14
To: Ava Community Energy Authority
From: Russell Mills, SVP and CFO
Subject: Informational Report on Rate Stabilization Funds Date: July 16, 2025
__________________________________________________________________ Summary
Staff will be providing information on Rate Stabilization Funds (“RSF”) with the Ava Board of Directors to highlight how utilities use these policies and funds. The information will review Ava’s existing Governmental Accounting Standards Board (“GASB”) 62 Rate Stabilization Policy and current fund balances to begin considering uses for the budget surplus realized at year end for Fiscal Year 2024-2025. Staff anticipates bringing recommendations for policy enhancements and surplus allocations later this fall after the financial audit confirms available balances.

Background and Discussion
Ava established a GASB 62 Rate Stabilization Fund in 2020, authorized by Resolution R-2020-26. The purpose of this fund is to defer revenues through budget surplus allocations, primarily to allow matching the timing for on-bill credits, the solar & storage incentive program, and a one-time allocation towards long-term renewable energy & clean energy storage investments.

GASB accounting rules allow public entities to defer revenues from one period for use in subsequent periods, by lowering revenues when deferred, and raising revenues when utilized to assist with stabilizing budgeted financial results and rates for customers.

Staff Report Item 14
Staff researched other utilities and public entities for the existence and use of rate stabilization funds and the policies that govern their use.

Survey of Comparable Best Practices
In considering how to utilize the budget surplus, staff has completed a broad survey of the reserve policies for 22 public agencies to determine comparable best practices for utilizing rate stabilization funds. These agencies were selected by surveying the same group used for the reserve fund policy. The complete list of agencies surveyed is presented here:
• AC Transit—Regional Operator
• Alameda Municipal Power—Non CCA Public Power
• Ava Community Energy--CCA
• Central Coast Community Energy--CCA
• City of Burbank Water & Power—Non CCA Public Power
• Clean Energy Alliance--CCA
• Clean Power Alliance--CCA
• Clean Power SF--CCA
• Desert Community Energy--CCA
• East Bay Municipal Utility District—Regional Operator • Los Angeles Department of Water and Power—Non CCA Public Power • MCE--CCA
• Orange County Power Authority--CCA
• Peninsula Clean Energy--CCA
• Pico Rivera Innovative Municipal Energy—Non CCA Public Power • Pioneer Community Energy--CCA
• Redwood Coast Energy Authority--CCA
• Sacramento Municipal Utility District—Non CCA Public Power • San Diego Community Power--CCA
• Silicon Valley Clean Energy--CCA
• Sonoma Clean Power--CCA
• Valley Clean Energy--CCA
Following are the statistics of respondents related to the usage of an RSF:
• 6 Respondents (27%) had a separately outlined Rate Stabilization Fund Policy o 4 respondents set RSF levels as a percent of Operating and Maintenance (“O&M”) costs
 The average percent of O&M costs was 15%
o 2 respondents set RSF levels as a percent of expected gross revenues  Both respondents use 20% of gross revenues
Staff Report Item 14
• 9 Respondents (41%) expressly allow the Operating Reserves to be utilized for rate stability, but did not have a distinctly separate fund or policy • 15 Respondents (68%) generally referenced reserves as a tool for rate stability Every respondent that mentioned using reserves for rate stability had the same withdrawal restrictions as their operating reserve fund policy: 8 agencies give their Chief Executive Officer (“CEO”) or General Manager discretion for utilization of reserves, 4 require board approval, and 3 do not specify. 1 respondent specifically granted the CEO unlimited use of reserves to maintain the rate threshold to PG&E, as long as days cash on hand did not fall below 90 days.

Staff is evaluating the current RSF Policy to formulate a recommendation for any changes. The recommendation will consider refining any specifics within the existing policy on target funding levels, purposes and authority if needed. The existing policy does not have target funding levels at this time.

Financial Strength
Ava’s rate stabilization fund has defined uses and is an integral part of the financial strength that allows us to operate successfully within energy markets. Many external partners such as Ratings Agencies, credit providers and counterparties rely on Ava’s ability to perform and assess our creditworthiness and overall financial viability. Part of that assessment includes our liquidity and financial resources to continue to operate through turbulent markets, regulatory changes, and unforeseen events. Ava has structured its resources such that our planned uses would follow in a waterfall order of priority.

Our current waterfall of financial resources that support our financial strength is as follows:

Waterfall of Liquidity Resources

1. Working Capital

2. Rate Stabilization Fund

3. Credit Facility

4. Reserve Fund
As a critical part of Ava’s financial resources, having the ability to maintain stable rates in response to cyclical and short-term market volatility, or effects from other rate setting Staff Report Item 14
proceedings such as the Power Charge Indifference Adjustment (“PCIA”), is prudent. It is anticipated that funds may be utilized 1-2 times each decade, and potentially necessary in the near term. Considering the policy and any potential changes needed at this time will help Ava manage future actions that solidify our ability to provide a value proposition and maintain strong “A” ratings.

Fiscal year 2024-25 is forecast to end strongly with an approximate $100 million surplus. At this time, staff is providing an informational update on this and seeking feedback on potential changes to the budget surplus allocation and rate stabilization fund policy. Staff anticipates providing a recommendation in the September or October timeframe for how to allocate the surplus and will include recommended modifications to the current RSF policy.

Financial Impact
Not applicable
Committee Recommendation
Not applicable.

Attachments
A. Rate Stabilization Fund Informational Presentation
Rate Stabilization Fund
Informational Review
Rusty Mills | July 16, 2025
Attachment Staff Report Item 14A
Background and History of Ava’s Rate Stabilization Policy 2 On September 16, 2020, the Board of Directors (BOD) approved by resolution (R-2020-26) creating a budget stabilizing fund to allow Ava to defer and allocate surplus revenues during strong financial performance periods for future utilization during more challenging periods
• The Board approved establishing, allocating funds and maintaining a GASB 62 Rate Stabilization Fund (RSF) to provide a contingency available to satisfy financial covenants, stabilize customer rates, fulfill local development, among other uses
o Note that subsequent to creating the Rate Stabilization Fund, Ava created a separate fund to maintain local development funding that is not a revenue deferral fund, only a cash fund similar to reserve funding • This fund has primarily been maintained to allow matching of timing for on-bill credits, the solar & storage incentive program, a one-time allocation towards long-term renewable energy & clean energy storage investments, and volatility in PCIA
Attachment Staff Report Item 14A
What is GASB 62 and How Do They Operate?
3 Government Accounting Standards Board Ruling 62 (GASB 62): codifies and standardizes “the presentation of deferred outflows of resources and deferred inflows of resources and their effects on net position.”
o This allows for deferring the accrual of surplus revenues from a prosperous period to be realized in future time periods
o Any deferred revenues will reduce net position by an equal amount in the period deferred, and increase net position by an equal amount in the period
o This is an accounting treatment different than reserve funds, as reserve funds are withheld cash amounts from already accrued and realized revenues
When to Utilize: Utilities and CCAs typically utilize funds for specific programmatic purposes and/or to maintain stable rates in response to cyclical and short-term market volatility or other events impacting rate setting, anticipated 1-2 times each decade.

Attachment Staff Report Item 14A
Benefits & Utilization of Ava's Rate Stabilization Fund 4 • Stabilizes Ava's rates charged to customers, helping preserve the value proposition • Fosters strong financial covenant agreements with counter parties • The RSF is an integral part of Ava’s waterfall of liquidity resources that maintain our ability to operate and supports our financial strength and "A" ratings The waterfall consists of four distinct levels for utilization:

1. Working Capital – Ongoing Operational Cash Flow

2. Rate Stabilization Fund – Smooth out cash flows during challenging budget cycles

3. Credit Facility** – Post LOCs to operate and only draw if necessary (when RSF depleted)

4. Reserve Funds – Financial strength base layer set aside as a "Disaster/Earthquake" fund **Credit Facility may have Capital Projects uses in Future; Staff would maintain partial capacity to use for cash flow support
Attachment Staff Report Item 14A
Ava Rate Stabilization Fund Utilization
5 • The GASB 62 Rate Stabilization Fund was
established by Resolution R-2020-26
• Current balance is approximately $57.6MM
with ~$32.1MM retained specifically for rate
stabilization
• Based on the strong forecasted surplus for
2024-25 of >$107MM, staff will propose a
recommendation to allocate all or a portion
to the Rate Stabilization Fund in
September/October timeframe
• If we allocate the current year's full surplus,
this would total $139MM for rate stabilization
o The Rate Stabilization Fund is intended to be
used to balance surplus and deficit year
reflecting over and under-collection year to year FY Contribution Recognition Balance Purpose 2020 12,680,000 - 12,680,000
Stabilize Local Development balance until
Fund is established by Reso R2020-26
2021 15,814,000 12,680,000 15,814,000
Recognized LD balance with fund
establishment via Budget. Contributed to PCIA
PUBA balance through December 2023 as
allocated by Audit
2022 - - 15,814,000
2023 37,200,000 - 53,014,000
~$10.5MM each for on-bill credits and PPA
premium plus $16.2MM for rate stabilization
as allocated by audit and Resolution R-2023-
37 2024 - 10,504,837 42,509,163
Recognition is for on-bill credits, by
Resolution R-2023-58
2025 37,407,824 22,316,492 57,600,495
Contribution for on-bill credits and NBT from
surplus revenue as allocated by audit and
Resolution R-2024-2. Recognition is net on-bill credits by Resolution R-2024-73. 2026 3,194,472 35,327,000 25,467,967
Bold is potential contribution from FY 2024-25
for recognition in FY 2025-26
2027 - 10,504,837 14,963,130
Recognition is for PPA premium contribution
from 2023, by Resolutions R-2023-58 and R-2024-26
2027 - 14,963,130 -
Possible recognition of NBT incentives
contributed in FY 2025
Attachment Staff Report Item 14A
Survey of Comparable RSF Best Practices
In considering the adequacy of Ava’s rate stabilization policy and funding, staff has completed a broad survey of 22 public agencies to discover comparable best practices for RSF policy and management The goals of the survey were as follows:
• Discover how many companies have an RSF and how it
integrates with reserve policies
• Compare RSF fund sizes and triggers for utilization
• Discover best practices for RSF utilization discretion 6 Agencies Surveyed
• AC Transit
• Alameda Municipal Power
• Ava Community Energy
• Central Coast Community Energy
• City of Burbank Water & Power
• Clean Energy Alliance
• Clean Power Alliance
• Clean Power SF
• Desert Community Energy
• EBMUD
• LADWP
• MCE
• Orange County Power Authority
• Peninsula Clean Energy
• Pico Rivera IME
• Pioneer Community Energy
• Redwood Coast Energy Authority
• SMUD
• San Diego Community Power
• Silicon Valley Clean Energy
• Sonoma Clean Power
• Valley Clean Energy
Attachment Staff Report Item 14A
Results of Survey of Comparable Best Practices
Statistics of Respondents:
• 6 Respondents (27%) had a separately outlined Rate Stabilization Fund Policy ▪ 4 respondents set RSF levels as a percent of Operating and Maintenance (O&M) costs • The average percent of O&M costs was 15%
▪ 2 respondents set RSF levels as a percent of expected gross revenues • Both respondents use 20% of gross revenues
• 9 Respondents(41%) had mentions in the Operating Reserves for rate stability, but did not have a distinctly separate fund or policy or Rate Stabilization
• 15 Respondents (68%) talked about using reserves as a tool for rate stability • Every respondent that mentioned using reserves for rate stability had the same withdrawal restrictions as their operating reserve fund policy:
▪ 8 agencies (39%) allow CEO discretion for utilization of reserves, 4 require board approval, and 3 do not specify.
• 1 respondent specifically granted the CEO unlimited use of reserves to maintain the rate threshold to PG&E, as long as days cash on hand did not fall below 90 days.
7 Attachment Staff Report Item 14A
Conclusion & Next Steps
• Ava's Rate Stabilization Fund and Policy is in line with industry norms for similar agency operations
• Rate Stabilization Funds play a vital role in rate stability and are an integral part of a financially strong CCA/Utility balance sheet
• Separate from Reserves higher in Financial Resource Waterfall • The fiscal 2024-2025 Budget Surplus may be necessary to maintain financial metrics and customer Value proposition over the next couple of years • Staff will bring forward a recommendation Rate Stabilization Fund allocation and any edits to the existing policy for consideration in the September/October timeframe
8 Attachment Staff Report Item 14A
Potential Uses for the FY 24-25 Budget Surplus
Ava Forecasts to end the year with an
approximate $100 million budget surplus.
o Later this fall staff will recommend how we will allocate the surplus and propose any modifications to the policy Potential Modification of the RSF Policy
• Policy currently doesn’t have funding levels; staff may propose a funding level target and range
▪ As an example, 10 to 30% of costs or revenues with a 15-20% target
▪ Consistent with best practices
▪ Should be complementary to other levels in financial
resource waterfall (working capital, line of credit and reserves)
9 Scenario Contribution* Balance
Budget Waterfall As Approved
Reserves 73,257,000 404,130,400
Solar & Storage Incentives 10,000,000 24,963,130
Customer Credits 19,258,000 19,258,000
Rate Stabilization Fund - 32,132,528
100% Allocation to RSF
Reserves - 330,873,400
Rate Stabilization Fund 102,515,000 134,647,528
80% RSF/ 20% Reserves
Reserves 20,503,000 20,503,000
Rate Stabilization Fund 82,012,000 114,144,528
* Contributions to Reserves and RSF is based on 4/30/2025 actuals Attachment Staff Report Item 14A
Questions & Discussion
10 Attachment Staff Report Item 14A
Staff Report Item 15
Staff Report Item 15
To: Ava Community Energy Authority
From: Joanie Brooke, Power Resources Manager, Contracts Courtney Wall, Power Resources Manager, Contracts
Subject: Approving Two Resolutions (1) Authorizing the Chief Executive Officer to Negotiate and Execute a Solar and Storage Power Purchase Agreement with EDPR CA Solar Park VI LLC and (2) Authorizing the Chief Executive Officer to Negotiate and Execute an Energy Storage Agreement with EDPR Scarlet III LLC and a Fourth Amendment to the Power Purchase Agreement with EDPR Scarlet I LLC
Date: July 16, 2025
__________________________________________________________________ Summary/Recommendation
(1) Adopt a Resolution authorizing the Chief Executive Officer (“CEO”) to negotiate and execute a Solar and Storage Power Purchase Agreement (“PPA”) with EDPR CA Solar Park VI LLC, a co-located 200 mega-watt (“MW”) solar PV project and 184 MW/736 Megawatt-Hour (“MWh”) battery energy storage system (“BESS”), collectively referred to as the “Sonrisa Project”. (2) Adopt a Resolution authorizing the Chief Executive Officer (“CEO”) to negotiate and execute an Energy Storage Agreement (“ESA”) with EDPR Scarlet III LLC, for a 70 mega-watt (“MW”) battery energy storage facility (the “Scarlet III Project”).

Analysis and Context (with deadlines as applicable)
(1) Sonrisa Project Analysis and Context:

The Sonrisa Project is a co-located 200 MW solar and 184 MW 4-hour BESS project that includes energy, environmental attributes, ancillary services, and capacity attributes from a facility in Fresno County, CA; developed by EDP Renewables North America, the term can be Staff Report Item 15
up to 20 years in length. EDP Renewables North America has committed to using union labor for the construction of the Sonrisa Project. The Sonrisa Project plans to be commercially operational by June 30, 2027, with the potential to reach commercial operation as early as December 31, 2026.

In addition to Ava actively negotiating the solar and storage PPA with EDPR CA Solar Park VI LLC, Ava will amend the agreement to separate the 184 MW/736MWh battery energy storage component into a separate ESA with Sonrisa BESS LLC at a later date.

EDP Renewables North America submitted the Sonrisa Project during Ava’s 2024 Long-Term Resource Request for Offers (“RFO”). At the time Ava did not move forward with the project due to uncertainty in Ava’s need for additional generation. In 2025, EDP Renewables North America again offered the Sonrisa Project to Ava and negotiations have restarted based on Ava’s forecasted need for additional generation and current market conditions.

Ava will enter into an up to 20-year agreement with a planned commercial operation date of June 30, 2027 with the potential for the project to reach commercial operation as early as December 31, 2026. Ava believes the project pricing is competitive relative to the current market and will be captured at a price that realizes the benefit of safe-harbored material to lower the cost of the project for Ava customers.

Ava is asking the Board to Authorize the CEO to continue these negotiations, and when complete, execute the Sonrisa Project Solar and Storage PPA. (2) Scarlet III Project Analysis and Context:

The Scarlet III Project is a 70 MW BESS that includes storage capacity, ancillary services, and capacity attributes that will be co-located with the existing and operational EDPR Scarlet I LLC (the “Scarlet I Project”) and will have a matching term of about 17 years. The Scarlet I Project is currently contracted with Ava under a long-term PPA. The Scarlet III Project is an expansion of the BESS to match the existing solar generation of the Scarlet I Project located in Fresno County, CA and developed by EDP Renewables. EDP Renewables North America has committed to using union labor for the construction of the Scarlet III Project. The Scarlet III Project plans to be commercially operational by June 1, 2027, with the potential to reach commercial operation as early as December 31, 2026. When operational, the combined Scarlet I and Scarlet III projects capacity will be 100 MW Solar and 100 MW/400 Mega-watt hour (“MWh”) BESS. The Scarlet III ESA will supersede and terminate the existing Scarlet III Energy Storage Resource Adequacy Agreement.

In June 2019, Ava (formerly as East Bay Community Energy) executed a Solar and Storage PPA with EDPR CA Solar Park VI LLC. Subsequently, this agreement was assigned to RE Scarlet I, LLC on March 21, 2022, and then to EDPR Scarlet I LLC on June 16, 2022. The Scarlet 1 Project is a co-located 100 MW solar with a 30 MW/120 MWh BESS project, that reached commercial operation in 2024. EDP Renewables submitted the Scarlet III Project as a 70 MW battery expansion proposal to the Scarlet I Project in 2024. When operational, the combined Scarlet I and Scarlet III projects will have a capacity of 100 MW solar and 100 MW/400 MWh BESS.

Staff Report Item 15
Ava and EDP Renewables began negotiations for the Scarlet III Project earlier in 2025 but paused negotiations due to uncertainty around the import tariff policy at that time. In June 2025, EDP Renewables approached Ava to resume negotiations.

Ava executed an Energy Storage Resource Adequacy Agreement with EDPR Scarlet III LLC on April 28, 2023, as amended by the First Amendment on December 20, 2024, and as amended by the Second Amendment on March 24, 2025. This Energy Storage Resource Adequacy Agreement will be terminated and superseded by the proposed Scarlet III ESA, which includes additional energy products and should allow Ava to realize better economic benefits for the Scarlet I solar generation.

The Scarlet III Project would provide project benefits from the BESS and enable Ava to move all of the solar generation through the BESS which should create better market performance for the resource in aggregate. The Scarlet III Project will also assume a portion of the Resource Adequacy currently allocated to the Scarlet I Project through a Fourth Amendment to the Scarlet I PPA.

Ava is asking the Board to Authorize the CEO to continue these negotiations, and when complete, execute a Scarlet III Project ESA and a Scarlet I Project Amendment.

Benefits Applicable to Both Sonrisa and Scarlet III Projects:

Executing the agreements for these projects at this time enables EDP Renewables North America to secure certain property tax benefits that will expire at the end of 2026 and allows for Investment Tax Credit (“ITC”) and Production Tax Credit (“PTC”) benefits to be realized from material safe-harboring currently applicable under tax law and pass these benefits onto to Ava customers.

Each agreement contains terms to manage future tariff rate uncertainty affecting specified material on the projects with a mechanism to adjust the pricing where Ava shares some of the impacts of the tariff rate changes with EDP Renewables North America, up to a defined price cap. The final price impacts will be determined by a third-party report evaluating the final import tariff costs. The agreements contain a termination payment to Ava in the event termination occurs due to tariff costs exceeding the price cap.

While negotiations are ongoing, Ava has attached a Solar and Storage PPA that was previously executed with EDP Renewables in 2019 as an example. The proposed agreements will follow a similar structure and format.

Attachments
A. Resolution of the Board of Directors of Ava Community Energy Authorizing the Chief Executive Officer to Negotiate and Execute a Power Purchase Agreement with EDPR CA Solar Park VI LLC.

B. Resolution of the Board of Directors of Ava Community Energy Authorizing the Chief Executive Officer to Negotiate and Execute an Energy Storage Agreement with EDPR Staff Report Item 15
Scarlet III LLC and a Fourth Amendment to the EDPR Scarlet I LLC Power Purchase Agreement.

C. 2019 Solar and Storage Power Purchase Agreement with EDPR CA Solar Park VI LLC D. PowerPoint Slide Deck
Attachment Staff Report Item 15A
RESOLUTION NO. R-2025-XX

A RESOLUTION OF THE BOARD OF DIRECTORS

OF AVA COMMUNITY ENERGY AUTHORITY AUTHORIZING THE CHIEF

EXECUTIVE OFFICER TO NEGOTIATE AND EXECUTE A POWER

PURCHASE AGREEMENT WITH EDPR SOLAR PARK VI LLC
WHEREAS Ava Community Energy Authority (“Ava”) was formed as a community choice aggregation agency (“CCA”) on December 1, 2016, under the Joint Exercise of Powers Act, California Government Code sections 6500 et seq., among the County of Alameda, and the Cities of Albany, Berkeley, Dublin, Emeryville, Fremont, Hayward, Livermore, Piedmont, Oakland, San Leandro, and Union City to study, promote, develop, conduct, operate, and manage energy-related climate change programs in all of the member jurisdictions. The cities of Newark and Pleasanton, located in Alameda County, along with the City of Tracy, located in San Joaquin County, were added as members of Ava and parties to the Joint Powers Agreement (“JPA”) in March of 2020. The city of Stockton was added as a member to Ava in September of 2022. The city of Lathrop was added as a member to Ava in October of 2023. San Joaquin County was added as a member to Ava in July 2024.

On October 24, 2023, Ava legally adopted the name Ava Community Energy Authority, where it had previously used the name East Bay Community Energy Authority since its inception.

WHEREAS Ava issued a 2024 Long-Term Resources Request for Offers (“RFO”);
WHEREAS EDPR Solar Park VI LLC proposed a co-located 200 Mega-watt (“MW”) solar and 184 MW/736 Mega-Watt Hour (“MWh”) battery storage project (the “Sonrisa Project”) located in Fresno County, CA; to be developed by EDP Renewables;
WHEREAS The Sonrisa Project is expected to be operational June 30, 2027 with an option to reach commercial operation as early as December 31, 2026 for a term of up to 20 years;
WHEREAS The Sonrisa Project was evaluated against offers in the 2024 RFO; WHEREAS Ava staff is negotiating a 200 MW Solar and 184 MW/736MWh Storage Power Purchase Agreement with EDPR Solar Park VI LLC and, at a later date, will amend the agreement to separate the 184MW/736MWh battery energy storage portion of the project into an Energy Storage Agreement with Sonrisa BESS LLC.

NOW, THEREFORE, THE BOARD OF DIRECTORS OF AVA COMMUNITY ENERGY AUTHORITY DOES HEREBY RESOLVE AS FOLLOWS:

Section 1. The Chief Executive Officer, in consultation with staff and legal counsel, is hereby authorized to negotiate and execute a Solar and Storage Power Attachment Staff Report Item 15A
Purchase Agreement with EDPR Solar Park VI LLC and at a later date, separate this agreement into a 200 MW Solar PPA with EDPR Solar Park VI LLC and a 184 MW/736MWh Energy Storage Agreement with Sonrisa BESS LLC.

ADOPTED AND APPROVED this 16
th day of July, 2025.

Jack Balch, Chair
ATTEST:

Adrian Bankhead, Clerk of the Board
Attachment Staff Report Item 15B
RESOLUTION NO. R-2025-XX

A RESOLUTION OF THE BOARD OF DIRECTORS

OF AVA COMMUNITY ENERGY AUTHORITY AUTHORIZING THE CHIEF

EXECUTIVE OFFICER TO NEGOTIATE AND EXECUTE AN ENERGY

STORAGE AGREEMENT WITH EDPR SCARLET III LLC AND A FOURTH

AMENDMENT TO THE POWER PURCHASE AGREEMENT WITH EDPR

SCARLET I LLC
WHEREAS Ava Community Energy Authority (“Ava”) was formed as a community choice aggregation agency (“CCA”) on December 1, 2016, under the Joint Exercise of Powers Act, California Government Code sections 6500 et seq., among the County of Alameda, and the Cities of Albany, Berkeley, Dublin, Emeryville, Fremont, Hayward, Livermore, Piedmont, Oakland, San Leandro, and Union City to study, promote, develop, conduct, operate, and manage energy-related climate change programs in all of the member jurisdictions. The Cities of Newark and Pleasanton, located in Alameda County, along with the City of Tracy, located in San Joaquin County, were added as members of Ava and parties to the Joint Powers Agreement (“JPA”) in March of 2020. The City of Stockton was added as a member to Ava in September of 2022. The City of Lathrop was added as a member to Ava in October of 2023. San Joaquin County was added as a member to Ava in July 2024.

On October 24, 2023, Ava legally adopted the name Ava Community Energy Authority, where it had previously used the name East Bay Community Energy Authority since its inception;
WHEREAS Ava Executed a Power Purchase Agreement (“PPA”) with EDPR Solar Park VI LLC on June 21, 2019, for a 100 Mega-watt (“MW”) solar and 30 MW/120 Mega-watt hour (“MWh”) battery storage project, the “Scarlet I Project,” that reached commercial operation in 2024;
WHEREAS EDPR Solar Park VI LLC assigned the Scarlet I Project Agreement to RE Scarlet I, LLC on March 21, 2022. Then, RE Scarlet I, LLC assigned the Scarlet I Project agreement to EDPR Scarlet I LLC on June 16, 2022; WHEREAS EDPR Scarlet III LLC (the “Scarlet III Project”), proposed a co-located 70 MW battery expansion to the Scarlet I Project in Fresno County, CA, will be developed by EDP Renewables North America;
WHEREAS The Scarlet III Project is expected to be operational by June 1, 2027, with an option to become commercially operational as early as December 31, 2026, for a term of approximately 17 years;
WHEREAS A portion of the Resource Adequacy products currently contracted in the Scarlet I Project PPA will be reallocated to the Scarlet III Project Energy Storage Agreement (“ESA”);
WHEREAS Ava staff is negotiating an ESA for the Scarlet III Project and an Amendment to the PPA for the Scarlet I Project.

Attachment Staff Report Item 15B

NOW, THEREFORE, THE BOARD OF DIRECTORS OF AVA COMMUNITY ENERGY AUTHORITY DOES HEREBY RESOLVE AS FOLLOWS:

Section 1. The Chief Executive Officer, in consultation with staff and legal counsel, is hereby authorized to negotiate and execute an Energy Storage Agreement with EDPR Scarlet III LLC and a Fourth Amendment to the Power Purchase Agreement with EDPR Scarlet I LLC.

ADOPTED AND APPROVED this 16
th day of July, 2025.

Jack Balch, Chair
ATTEST:

Adrian Bankhead, Clerk of the Board
Execution Version
1 RENEWABLE POWER PURCHASE AGREEMENT

COVER SHEET
Seller: EDPR CA Solar Park VI LLC
Buyer: East Bay Community Energy Authority, a California joint powers authority Description of Facility: 100 MW solar photovoltaic electric generating facility combined with a 30 MW / 120 MWh lithium ion battery storage facility.

Milestones:

Milestone Date for
Completion
Evidence of Site Control
CEC Pre-Certification Obtained
Financing Milestone
Conditional Use Permit
Seller’s receipt of Phase I and Phase II Interconnection study results for Seller’s Interconnection Facilities
Executed Interconnection Agreement
Financial Close
Expected Construction Start Date
Guaranteed Construction Start Date
Full Capacity Deliverability Status Obtained
Initial Synchronization
Network Upgrades completed
Expected Commercial Operation Date
Guaranteed Commercial Operation Date
Delivery Term: The period for Product delivery will be for 20 Contract Years.

Attachment Staff Report Item 15C
2 Expected Energy:

Contract Year Expected Energy (MWh)
1 2
3 4
5 6
7 8
9 10
11 12
13 14
15 16
17 18
19 20
Guaranteed Capacity: 100 MW
Storage Contract Capacity: 30 MW at four hours of continuous discharge Storage Contract Output: 120 MWh
Storage Facility Loss Factor:

Storage Minimum Capacity Factor:

Attachment Staff Report Item 15C
Attachment Staff Report Item 15C

TABLE OF CONTENTS
Page
i
ARTICLE 1 DEFINITIONS .......................................................................................................... 1

1.1 Contract Definitions ............................................................................................... 1

1.2 Rules of Interpretation ......................................................................................... 22 ARTICLE 2 TERM; CONDITIONS PRECEDENT ................................................................... 23

2.1 Contract Term. ..................................................................................................... 23

2.2 Conditions Precedent ........................................................................................... 23

2.3 Development; Construction; Progress Reports .................................................... 24

2.4 Remedial Action Plan .......................................................................................... 24 ARTICLE 3 PURCHASE AND SALE ....................................................................................... 25

3.1 Purchase and Sale of Product ............................................................................... 25

3.2 Sale of Green Attributes. ...................................................................................... 25

3.3 Imbalance Energy. ............................................................................................... 25

3.4 Ownership of Renewable Energy Incentives. ...................................................... 25

3.5 Future Environmental Attributes. ........................................................................ 25

3.6 Test Energy. ......................................................................................................... 26

3.7 Capacity Attributes. ............................................................................................. 26

3.8 Resource Adequacy Failure ................................................................................. 27

3.9 CEC Certification and Verification. .................................................................... 27

3.10 Eligibility. ............................................................................................................ 27

3.11 California Renewables Portfolio Standard. .......................................................... 27

3.12 Compliance Expenditure Cap. ............................................................................. 28

3.13 Project Configuration ........................................................................................... 28 ARTICLE 4 OBLIGATIONS AND DELIVERIES .................................................................... 28

4.1 Delivery ................................................................................................................ 28

4.2 Title and Risk of Loss. ......................................................................................... 29

4.3 Forecasting ........................................................................................................... 29

4.4 Dispatch Down/Curtailment. ............................................................................... 31

4.5 Charging Energy Management ............................................................................ 32

4.6 Reduction in Delivery Obligation ........................................................................ 33

4.7 Guaranteed Energy Production. ........................................................................... 33

4.8 Storage Availability ............................................................................................. 34

4.9 Storage Capacity Tests ......................................................................................... 34

4.10 WREGIS .............................................................................................................. 34

4.11 Green-E Certification.. ......................................................................................... 36 ARTICLE 5 TAXES .................................................................................................................... 36

5.1 Allocation of Taxes and Charges. ........................................................................ 36

5.2 Cooperation. ......................................................................................................... 36 ARTICLE 6 MAINTENANCE OF THE FACILITY ................................................................. 37 Attachment Staff Report Item 15C
ii

6.1 Maintenance of the Facility. ................................................................................ 37

6.2 Maintenance of Health and Safety. ...................................................................... 37

6.3 Shared Facilities ................................................................................................... 37 ARTICLE 7 METERING ............................................................................................................ 37

7.1 Metering. .............................................................................................................. 37

7.2 Meter Verification. ............................................................................................... 38 ARTICLE 8 INVOICING AND PAYMENT; CREDIT ............................................................. 38

8.1 Invoicing. ............................................................................................................. 38

8.2 Payment. ............................................................................................................... 38

8.3 Books and Records. ............................................................................................. 38

8.4 Payment Adjustments; Billing Errors. ................................................................. 39

8.5 Billing Disputes. .................................................................................................. 39

8.6 Netting of Payments. ............................................................................................ 39

8.7 Seller’s Development Security. ........................................................................... 39

8.8 Seller’s Performance Security. ............................................................................. 40

8.9 First Priority Security Interest in Cash or Cash Equivalent Collateral ................ 40

8.10 ARTICLE 9 NOTICES ................................................................................................................ 41

9.1 Addresses for the Delivery of Notices ................................................................. 41

9.2 Acceptable Means of Delivering Notice .............................................................. 41 ARTICLE 10 FORCE MAJEURE .............................................................................................. 42

10.1 Definition ............................................................................................................. 42

10.2 No Liability If a Force Majeure Event Occurs .................................................... 42

10.3 Notice ................................................................................................................... 43

10.4 Termination Following Force Majeure Event ...................................................... 43 ARTICLE 11 DEFAULTS; REMEDIES; TERMINATION ...................................................... 43

11.1 Events of Default ................................................................................................. 43

11.2 Remedies; Declaration of Early Termination Date. ............................................. 46

11.3 Termination Payment ........................................................................................... 47

11.4 Notice of Payment of Termination Payment ....................................................... 47

11.5 Disputes With Respect to Termination Payment ................................................. 47

11.6 Rights And Remedies Are Cumulative ................................................................ 48

11.7 ARTICLE 12 LIMITATION OF LIABILITY AND EXCLUSION OF WARRANTIES .......... 48

12.1 No Consequential Damages. ................................................................................ 48

12.2 Waiver and Exclusion of Other Damages. ........................................................... 48 ARTICLE 13 REPRESENTATIONS AND WARRANTIES; AUTHORITY ........................... 49

13.1 Seller’s Representations and Warranties. ............................................................ 49

13.2 Buyer’s Representations and Warranties ............................................................. 50

13.3 General Covenants ............................................................................................... 51 Attachment Staff Report Item 15C
iii

13.4 Prevailing Wage. .................................................................................................. 51

13.5 Workforce Development. ..................................................................................... 51

13.6 Union Labor……………………………………………………………………..51
ARTICLE 14 ASSIGNMENT ..................................................................................................... 52

14.1 General Prohibition on Assignments ................................................................... 52

14.2 Collateral Assignment .......................................................................................... 52

14.3 Permitted Assignment by Seller ........................................................................... 54

14.4 Shared Facilities; Portfolio Financing ................................................................. 54 ARTICLE 15 DISPUTE RESOLUTION .................................................................................... 54

15.1 Governing Law. ................................................................................................... 54

15.2 Dispute Resolution. .............................................................................................. 55 ARTICLE 16 INDEMNIFICATION ........................................................................................... 55

16.1 Mutual Indemnity. .............................................................................................. 55

16.2 Notice of Claim. ................................................................................................... 55

16.3 Defense of Claims.. .............................................................................................. 56

16.4 Subrogation of Rights. . ....................................................................................... 56

16.5 Rights and Remedies are Cumulative.. ................................................................ 56 ARTICLE 17 INSURANCE ........................................................................................................ 57

17.1 Insurance .............................................................................................................. 57 ARTICLE 18 CONFIDENTIAL INFORMATION .................................................................... 58

18.1 Definition of Confidential Information ................................................................ 58

18.2 Duty to Maintain Confidentiality ......................................................................... 58

18.3 Irreparable Injury; Remedies ............................................................................... 58

18.4 Disclosure to Lenders, Etc. .................................................................................. 59

18.5 Press Releases ...................................................................................................... 59 ARTICLE 19 MISCELLANEOUS ............................................................................................. 59

19.1 Entire Agreement; Integration; Exhibits .............................................................. 59

19.2 Amendments ........................................................................................................ 59

19.3 No Waiver ............................................................................................................ 59

19.4 No Agency, Partnership, Joint Venture or Lease ................................................. 59

19.5 Severability .......................................................................................................... 60

19.6 Mobile-Sierra ....................................................................................................... 60

19.7 Counterparts; Electronic Signatures. ................................................................... 60

19.8 Facsimile or Electronic Delivery ......................................................................... 60

19.9 Binding Effect ...................................................................................................... 60

19.10 No Recourse to Members of Buyer ..................................................................... 60

19.11 Forward Contract. . ............................................................................................. 61

19.12 Further Assurances ............................................................................................... 61 Attachment Staff Report Item 15C
iv
Exhibits:

Exhibit A Facility Description
Exhibit B Major Project Development Milestones and Commercial Operation Exhibit C Compensation
Exhibit D Scheduling Coordinator Responsibilities
Exhibit E Progress Reporting Form
Exhibit F-1 Form of Average Expected Energy Report
Exhibit F-2 Form of Monthly Available Generating Capacity Report Exhibit G Guaranteed Energy Production Damages Calculation Exhibit H Form of Commercial Operation Date Certificate Exhibit I Form of Installed Capacity Certificate
Exhibit J Form of Construction Start Date Certificate
Exhibit K Form of Letter of Credit
Exhibit L Form of Guaranty
Exhibit M Form of Replacement RA Notice
Exhibit N Notices
Exhibit O Storage Capacity Tests
Exhibit P Storage Facility Availability
Exhibit Q Operating Restrictions
Exhibit R Metering Diagram
Exhibit S Adjusted Qualifying Capacity
Attachment Staff Report Item 15C

RENEWABLE POWER PURCHASE AGREEMENT
This Renewable Power Purchase Agreement (“Agreement”) is entered into as of June 21, 2019 (the “Effective Date”), between Buyer and Seller. Buyer and Seller are sometimes referred to herein individually as a “Party” and jointly as the “Parties.” All capitalized terms used in this Agreement are used with the meanings ascribed to them in Article 1 to this Agreement.

RECITALS
WHEREAS, Seller intends to develop, design, permit, construct, own, and operate the Facility; and
WHEREAS, Seller desires to sell, and Buyer desires to purchase, on the terms and conditions set forth in this Agreement, the Product;
NOW THEREFORE, in consideration of the mutual covenants and agreements herein contained, and for other good and valuable consideration, the sufficiency and adequacy of which are hereby acknowledged, the Parties agree to the following:

ARTICLE 1

DEFINITIONS

1.1 Contract Definitions. The following terms, when used herein with initial capitalization, shall have the meanings set forth below:
“AC” means alternating current.
“Accepted Compliance Costs” has the meaning set forth in Section 3.12. “Adjusted Energy Production” has the meaning set forth in Exhibit G. “Adjusted Facility Energy” means, for the applicable period, the sum of (a) the total Facility Energy for such period, plus (b) the result of subtracting (i) the total Discharging Energy for such period from (ii) the total Discharging Energy for such period divided by the Storage Facility Loss Factor.
“Adjusted Qualifying Capacity” has the meaning set forth in Exhibit S. “Affiliate” means, with respect to any Person, each Person that directly or indirectly controls, is controlled by, or is under common control with such designated Person. For purposes of this definition and the definition of “Permitted Transferee”, “control” (including, with correlative meanings, the terms “controlled by” and “under common control with”), as used with respect to any Person, shall mean (a) the direct or indirect right to cast at least fifty percent (50%) of the votes exercisable at an annual general meeting (or its equivalent) of such Person or, if there are no such rights, ownership of at least fifty percent (50%) of the equity or other ownership interest in such Person, or (b) the right to direct the policies or operations of such Person.

Attachment Staff Report Item 15C
2 “Agreement” has the meaning set forth in the Preamble and includes any Exhibits, schedules and any written supplements hereto, the Cover Sheet, and any designated collateral, credit support or similar arrangement between the Parties. “Ancillary Services” means all ancillary services, products and other attributes, if any, associated with the Facility.
“Approved Forecast Vendor” means (x) any of Meteologica or Vaisala or their respective Affiliates or successors or (y) any other vendor reasonably acceptable to both Buyer and Seller for the purposes of providing or verifying the forecasts under Section 4.3(d). “Availability Adjusted Storage Contract Capacity” has the meaning set forth in Exhibit P.
“Available Generating Capacity” means the capacity of the Generating Facility, expressed in whole MWs, that is mechanically available to generate Energy. “Bankrupt” means with respect to any entity, such entity that (a) files a petition or otherwise commences, authorizes or acquiesces in the commencement of a proceeding or cause of action under any bankruptcy, insolvency, reorganization or similar Law, (b) has any such petition filed or commenced against it which remains unstayed or undismissed for a period of ninety (90) days, (c) makes an assignment or any general arrangement for the benefit of creditors, (d) otherwise becomes bankrupt or insolvent (however evidenced), (e) has a liquidator, administrator, receiver, trustee, conservator or similar official appointed with respect to it or any substantial portion of its property or assets, or (f) is generally unable to pay its debts as they fall due. “Business Day” means any day except a Saturday, Sunday, or a Federal Reserve Bank holiday in California. A Business Day begins at 8:00 a.m. and ends at 5:00 p.m. local time for the Party sending a Notice, or payment, or performing a specified action. “Buyer” means East Bay Community Energy Authority, a California joint powers authority.
“Buyer Bid Curtailment” means any curtailment of the Facility arising out of or resulting from the manner in which Buyer bids, offers or schedules the Facility, the Energy or any Products, or in which Buyer fails to do so, including) a situation where all of the following occurs:
(a) the CAISO provides notice to a Party or the Scheduling Coordinator for the Facility, requiring the Party to deliver less Facility Energy from the Facility than the full amount of energy forecasted in accordance with Section 4.3 to be produced from the Facility for a period of time; (b) for the same time period as referenced in (a), the notice referenced in (a) results from the manner in which Buyer or the SC schedules or bids the Facility or Facility Energy, including where the Buyer or the SC for the Facility:
(i) did not submit a Self-Schedule or an Energy Supply Bid for the MW subject to the reduction; or
(ii) submitted an Energy Supply Bid and the CAISO notice referenced in (a) is solely Attachment Staff Report Item 15C
3 a result of CAISO implementing the Energy Supply Bid; or (iii) submitted a Self-Schedule for less than the full amount of Facility Energy forecasted to be generated by or delivered from the Facility.

If the Facility is subject to a Planned Outage, Forced Facility Outage, Force Majeure Event or a Curtailment Period during the same time period as referenced in (a), then the calculation of Deemed Delivered Energy in respect of such period shall not include any Energy that was not generated or stored due to such Planned Outage, Forced Facility Outage, Force Majeure Event or Curtailment Period.
“Buyer Curtailment Order” means (i) the instruction from Buyer to Seller to reduce Facility Energy from the Facility by the amount, and for the period of time set forth in such instruction, which instruction shall be consistent with the Operating Restrictions, for reasons unrelated to a Planned Outage, Forced Facility Outage, Force Majeure Event or Curtailment Order, or (ii) a curtailment of any portion of the Generating Facility or its output or any reduction in PV Energy arising out of Buyer’s issuance of any Discharging Notice or any other instruction, order or other communication requesting or requiring the Storage Facility to be discharged. “Buyer Curtailment Period” means the period of time, as measured using current Settlement Intervals, during which Seller reduces Facility Energy from the Facility pursuant to or as a result of (a) Buyer Bid Curtailment, (b) a Buyer Curtailment Order, or (c) Buyer Default; provided, that the duration of any Buyer Curtailment Period shall be inclusive of the time required for the Generating Facility to ramp down and ramp up.
“Buyer Default” means a failure by Buyer (or its agents) to perform Buyer’s obligations hereunder, and includes an Event of Default of Buyer.
“Buyer’s WREGIS Account” has the meaning set forth in Section 4.10(a). “CAISO” means the California Independent System Operator Corporation or any successor entity performing similar functions.
“CAISO Approved Meter” means a CAISO approved revenue quality meter or meters, CAISO approved data processing gateway or remote intelligence gateway, telemetering equipment and data acquisition services sufficient for monitoring, recording and reporting, in real time, all Facility Energy delivered to the Delivery Point.
“CAISO Grid” has the same meaning as “CAISO Controlled Grid” as defined in the CAISO Tariff.
“CAISO Operating Order” means the “operating order” defined in Section 37.2.1.1 of the CAISO Tariff.
“CAISO Tariff” means the California Independent System Operator Corporation Agreement and Tariff, Business Practice Manuals (BPMs), and Operating Procedures, including the rules, protocols, procedures and standards attached thereto, as the same may be amended or modified from time-to-time and approved by FERC.

Attachment Staff Report Item 15C
4 “California Renewables Portfolio Standard” or “RPS” means the renewable energy program and policies established by California State Senate Bills 1038 (2002), 1078 (2002), 107 (2008), X-1 2 (2011), 350 (2015), and 100 (2018) as codified in, inter alia, California Public Utilities Code Sections 399.11 through 399.31 and California Public Resources Code Sections 25740 through 25751, as such provisions are amended or supplemented from time to time. “Capacity Attribute” means any current or future defined characteristic, certificate, tag, credit, or accounting construct associated with the amount of power that the Facility can generate and deliver to the Delivery Point at a particular moment and that can be purchased and sold under CAISO market rules, including Resource Adequacy Benefits. “Capacity Damages” has the meaning set forth in Exhibit B. “CEC” means the California Energy Commission, or any successor agency performing similar statutory functions.
“CEC Certification and Verification” means that the CEC has certified (or, with respect to periods before the date that is one hundred eighty (180) days following the Commercial Operation Date, that the CEC has pre-certified) that the Generating Facility is an Eligible Renewable Energy Resource for purposes of the California Renewables Portfolio Standard and that all Facility Energy delivered to the Delivery Point qualifies as generation from an Eligible Renewable Energy Resource.
“CEC Precertification” means that the CEC has issued a precertification for the Facility indicating that the planned operations of the Facility would comply with applicable CEC requirements for CEC Certification and Verification.
“CEQA” means the California Environmental Quality Act.
“Change of Control” means, except in connection with public market transactions of equity interests or capital stock of Seller’s Ultimate Parent, any circumstance in which Ultimate Parent ceases to own, directly or indirectly through one or more intermediate entities, more than fifty percent (50%) of the outstanding equity interests in Seller; provided that in calculating ownership percentages for all purposes of the foregoing:
(a) any ownership interest in Seller held by Ultimate Parent indirectly through one or more intermediate entities shall not be counted towards Ultimate Parent’s ownership interest in Seller unless Ultimate Parent directly or indirectly owns more than fifty percent (50%) of the outstanding equity interests in each such intermediate entity; and (b) ownership interests in Seller owned directly or indirectly by any Lender (including any cash equity or tax equity provider) or assignee or transferee thereof shall be excluded from the total outstanding equity interests in Seller.
“Charging Energy” means the as-available Energy produced by the Generating Facility and delivered to the Storage Facility pursuant to a Charging Notice. All Charging Energy shall be used solely to charge the Storage Facility, and all Charging Energy shall be generated solely by Attachment Staff Report Item 15C
Attachment Staff Report Item 15C
Attachment Staff Report Item 15C
7 “Day-Ahead Forecast” has the meaning set forth in Section 4.3(c). “Day-Ahead Market” has the meaning set forth in the CAISO Tariff. “Day-Ahead Schedule” has the meaning set forth in the CAISO Tariff. “Deemed Delivered Energy” means the amount of Energy expressed in MWh that the Generating Facility would have produced and delivered to the Storage Facility or the Delivery Point, but that is not produced by the Generating Facility during a Buyer Curtailment Period, which amount shall, for any time period, be equal to (i) the Real-Time Forecast (of the hourly expected Energy) provided pursuant to Section 4.3(d) for the period of time during the Buyer Curtailment Period (or other relevant period), or, if mutually agreed by the Parties, then (ii) the difference between (a) the total amount of Energy that the Generating Facility would have produced during such Buyer Curtailment Period, as calculated by Seller in a manner reasonably acceptable to Buyer using the best available data obtained through commercially reasonable methods and meteorological data at the Generating Facility during such Buyer Curtailment Period, and any adjustments necessary to accurately reflect the Generating Facility’s capacity to produce and deliver Energy to the Delivery Point, including applicable losses and manufacturers’ warranted power curves, subject to Buyer’s verification not to be unreasonably withheld, minus (b) the amount of Energy that the Generating Facility produced and delivered to the Storage Facility or the Delivery Point during the Buyer Curtailment Period (or other relevant period); provided that, if the applicable difference between the foregoing clauses (a) and (b) is negative, the Deemed Delivered Energy shall be zero (0). If the LMP for the Facility’s PNode during such Settlement Interval was less than zero, Deemed Delivered Energy shall be reduced in any Settlement Interval by the amount of any Charging Energy that was not able to be delivered to the Storage Facility during such Settlement Interval due to the unavailability of the Storage Facility due to a Forced Facility Outage.
“Defaulting Party” has the meaning set forth in Section 11.1(a). “Deficient Month” has the meaning set forth in Section 4.10(e). “Deliverability Allocation” has the meaning set forth in Exhibit S. “Delivery Point” has the meaning set forth in Exhibit A. “Delivery Term” shall mean the period of Contract Years set forth on the Cover Sheet beginning on the Commercial Operation Date, unless terminated earlier in accordance with the terms and conditions of this Agreement.
“Development Cure Period” has the meaning set forth in Exhibit B. “Development Security”
“Discharging Energy” means all Energy delivered to the Delivery Point from the Storage Facility, net of the Electrical Losses, as measured at the Storage Facility Metering Points by the Attachment Staff Report Item 15C
8 Storage Facility Meter. For the avoidance of doubt, all Discharging Energy will have originally been delivered to the Storage Facility as Charging Energy. “Discharging Notice” means the operating instruction, and any subsequent updates, given by Buyer to Seller, directing the Storage Facility to discharge Discharging Energy at a specific MW rate to a specified Stored Energy Level, provided that any such operating instruction or updates shall be in accordance with the Operating Procedures. For the avoidance of doubt, except as otherwise provided in this Agreement, such as in the definition of Buyer Curtailment Order, any Discharging Notice shall not constitute a Buyer Bid Curtailment, Buyer Curtailment Order or Curtailment Order.
“Early Termination Date” has the meaning set forth in Section 11.2(a). “Effective Date” has the meaning set forth on the Preamble. “Electrical Losses” means all transmission or transformation losses between the Facility and the Delivery Point, including losses associated with (i) delivery of PV Energy to the Delivery Point, (ii) delivery of Charging Energy to the Storage Facility, (iii) conversion of Charging Energy into Discharging Energy, and (iv) delivery of Discharging Energy to the Delivery Point. “Eligible Renewable Energy Resource” has the meaning set forth in California Public Utilities Code Section 399.12(e) and California Public Resources Code Section 25741(a), as either code provision is amended or supplemented from time to time. “Energy” means electrical energy generated by the Generating Facility. “Energy Supply Bid” has the meaning set forth in the CAISO Tariff. “Environmental Costs” means costs incurred in connection with acquiring and maintaining all environmental permits and licenses for the Product, and the Product’s and Facility’s compliance with all applicable environmental Laws, rules and regulations, including capital costs for pollution mitigation or installation of emissions control equipment required to permit or license the Product or Facility, all operating and maintenance costs for operation of pollution mitigation or control equipment, costs of permit maintenance fees and emission fees as applicable, and the costs of all emission reduction credits, marketable emission trading credits, and any costs related to greenhouse gas emissions, required by any applicable environmental Laws, rules, regulations, and permits to operate, and costs associated with the disposal and clean-up of hazardous substances introduced to a Site or the Facility. “Event of Default” has the meaning set forth in Section 11.1. “Excess MWh” has the meaning set forth in Exhibit C.
“Executed Interconnection Agreement Milestone” means the date for completion of execution of the Interconnection Agreement by Seller and the PTO as set forth on the Cover Sheet. “Expected Commercial Operation Date” is the date set forth on the Cover Sheet by which Seller reasonably expects to achieve Commercial Operation.

Attachment Staff Report Item 15C
9 “Expected Construction Start Date” is the date set forth on the Cover Sheet by which Seller reasonably expects to achieve Construction Start. “Expected Energy” means the quantity of Energy that Seller expects to be able to deliver to Buyer from the Generating Facility during each Contract Year or other time period (assuming no Charging Energy or Discharging Energy during such Contract Year or time period) in the quantity specified on the Cover Sheet.
“Facility” means the Generating Facility and the Storage Facility. “Facility Energy” means the sum of PV Energy and Discharging Energy during any Settlement Interval or Settlement Period, net of Station Use, as measured by the Facility Meter, which Facility Meter will be adjusted in accordance with CAISO meter requirements and Prudent Operating Practices to account for Electrical Losses and Station Use. “Facility Meter” means the revenue quality meter or meters (with a 0.3 accuracy class), along with a compatible data processing gateway or remote intelligence gateway, telemetering equipment and data acquisition services sufficient for monitoring, recording and reporting, in real time all Facility Energy. Without limiting Seller’s obligation to deliver Facility Energy to the Delivery Point, the Facility Meter will be located at the medium voltage side of the main step up transformer, and Facility Energy will be measured and will be subject to adjustment in accordance with CAISO meter requirements and Prudent Operating Practices to account for Electrical Losses and Station Use.
“FERC” means the Federal Energy Regulatory Commission or any successor government agency.
“Financial Close” means Seller or one of its Affiliates has obtained debt or equity financing commitments from one or more Lenders sufficient to construct the Facility, including such financing commitments from Seller's owner(s).
“Financing Milestone” means the date set forth on the Cover Sheet for Seller to provide Buyer with a description, in detail reasonably acceptable to Buyer, of Seller’s strategy for establishing the Facility’s eligibility for the ITC.
“Force Majeure Event” has the meaning set forth in Section 10.1. “Forced Facility Outage” means an unexpected failure of one or more components of the Facility that prevents Seller from generating Energy or making Facility Energy available at the Delivery Point and that is not the result of a Force Majeure Event. “Forecasting Penalty” means for each hour in which Seller does not provide the forecast required in Section 4.3(d) and Buyer incurs a loss or penalty resulting from Seller’s failure and Buyer’s scheduling activities in such hour with respect to Facility Energy, the product of (A) the absolute difference (if any) between (i) the expected Energy for such hour (which, for the avoidance of doubt, assumes no Charging Energy or Discharging Energy in such hour) set forth in the Monthly Delivery Forecast, and (ii) the actual Energy produced by the Generating Facility Attachment Staff Report Item 15C
10 (absent any Charging Energy and Discharging Energy), multiplied by (B) the absolute value of the Real-Time Price in such hour.
“Forward Certificate Transfers” has the meaning set forth in Section 4.10(a). “Full Capacity Deliverability Status” means either (i) “Full Capacity Deliverability Status” as such term is defined in the CAISO Tariff or (ii) a Deliverability Allocation of one has been achieved.
“Full Capacity Deliverability Status Finding” means a written confirmation from the CAISO that the Facility is eligible for Full Capacity Deliverability Status. “Future Environmental Attributes” shall mean any and all generation attributes (other than Green Attributes or Renewable Energy Incentives) under the RPS regulations or under any and all other international, federal, regional, state or other law, rule, regulation, bylaw, treaty or other intergovernmental compact, decision, administrative decision, program (including any voluntary compliance or membership program), competitive market or business method (including all credits, certificates, benefits, and emission measurements, reductions, offsets and allowances related thereto) that are attributable, now, or in the future, to the generation of electrical energy by the Facility and its displacement of conventional energy generation. Future Environmental Attributes do not include investment tax credits or production tax credits associated with the construction or operation of the Facility, or other financial incentives in the form of credits, reductions, or allowances associated with the Facility that are applicable to a state or federal income taxation obligation.
“Gains” means, with respect to any Party, an amount equal to the present value of the economic benefit to it, if any (exclusive of Costs), resulting from the termination of this Agreement for the remaining Contract Term, determined in a commercially reasonable manner. Factors used in determining the economic benefit to a Party may include, without limitation, reference to information supplied by one or more third parties, which shall exclude Affiliates of the Non-Defaulting Party, including without limitation, quotations (either firm or indicative) of relevant rates, prices, yields, yield curves, volatilities, spreads or other relevant market data in the relevant markets, comparable transactions, forward price curves based on economic analysis of the relevant markets, settlement prices for comparable transactions at liquid trading hubs (e.g., SP-15), all of which should be calculated for the remaining Contract Term, and include the value of Green Attributes and Capacity Attributes.
“Generating Facility” means the solar photovoltaic generating facility described on the Cover Sheet and in Exhibit A, located at the Site and including mechanical equipment and associated facilities and equipment required to deliver (i) PV Energy to the Delivery Point, (ii) Charging Energy to the Storage Facility; provided, that the “Generating Facility” does not include the Storage Facility or the Shared Facilities.
“Governmental Authority” means any federal, state, provincial, local or municipal government, any political subdivision thereof or any other governmental, congressional or parliamentary, regulatory, or judicial instrumentality, authority, body, agency, department, bureau, Attachment Staff Report Item 15C
11 or entity with authority to bind a Party at law, including CAISO; provided, however, that “Governmental Authority” shall not in any event include any Party. “Green Attributes” means any and all credits, benefits, emissions reductions, offsets, and allowances, howsoever entitled, attributable to the generation from the Facility and its displacement of conventional energy generation. Green Attributes include but are not limited to Renewable Energy Credits, as well as: (1) any avoided emissions of pollutants to the air, soil or water such as sulfur oxides (SOx), nitrogen oxides (NOx), carbon monoxide (CO) and other pollutants; (2) any avoided emissions of carbon dioxide (CO2), methane (CH4), nitrous oxide, hydrofluorocarbons, perfluorocarbons, sulfur hexafluoride and other greenhouse gases (GHGs) that have been determined by the United Nations Intergovernmental Panel on Climate Change, or otherwise by law, to contribute to the actual or potential threat of altering the Earth’s climate by trapping heat in the atmosphere; (3) the reporting rights to these avoided emissions, such as Green Tag Reporting Rights. Green Tags are accumulated on a MWh basis and one Green Tag represents the Green Attributes associated with one (1) MWh of Energy. Green Attributes do not include (i) any energy, capacity, reliability or other power attributes from the Facility, (ii) production tax credits associated with the construction or operation of the Facility and other financial incentives in the form of credits, reductions, or allowances associated with the Facility that are applicable to a state or federal income taxation obligation, (iii) fuel-related subsidies or “tipping fees” that may be paid to Seller to accept certain fuels, or local subsidies received by the generator for the destruction of particular preexisting pollutants or the promotion of local environmental benefits, or (iv) emission reduction credits encumbered or used by the Facility for compliance with local, state, or federal operating or air quality permits. If the Facility is a biomass or landfill gas facility and Seller receives any tradable Green Attributes based on the greenhouse gas reduction benefits or other emission offsets attributed to its fuel usage, it shall provide Buyer with sufficient Green Attributes to ensure that there are zero net emissions associated with the production of electricity from the Facility.
“Green Tag Reporting Rights” means the right of a purchaser of renewable energy to report ownership of accumulated “green tags” in compliance with and to the extent permitted by applicable Law and include, without limitation, rights under Section 1605(b) of the Energy Policy Act of 1992, and any present or future federal, state or local certification program or emissions trading program, including pursuant to the WREGIS Operating Rules. “Guaranteed Capacity” means the amount of generating capacity of the Generating Facility, as measured in MW at the Delivery Point, set forth on the Cover Sheet, as the same may be adjusted pursuant to Section 5(a) of Exhibit B.
“Guaranteed Commercial Operation Date” means the Expected Commercial Operation Date, as such date may be extended by the Development Cure Period. “Guaranteed Construction Start Date” means the Expected Construction Start Date, as such date may be extended by the Development Cure Period. “Guaranteed Energy Production” means an amount of Adjusted Facility Energy, as measured in MWh, equal to of the total Expected Energy (as set forth on the Cover Sheet) for the applicable Performance Measurement Period.

Attachment Staff Report Item 15C
12 “Guaranteed Storage Availability” has the meaning set forth in Section 4.8. “Guarantor” means, with respect to Seller, (a) Energias de Portugal, Sociedade Anonima, Secursal en España or (b) any Person that (i) Buyer does not already have any material credit exposure to under any other agreements, guarantees, or other arrangements at the time its Guaranty is issued, (ii) is an Affiliate of Seller, or other third party reasonably acceptable to Buyer, (iii) has an Investment Grade Credit Rating, (iv) has a tangible net worth of at least (v) is incorporated or organized in a jurisdiction of the United States and is in good standing in such jurisdiction, and (vi) executes and delivers a Guaranty for the benefit of Buyer.
“Guaranty” means a guaranty from a Guarantor provided for the benefit of Buyer substantially in the form attached as Exhibit L.
“Hazardous Substance” means, collectively, (a) any chemical, material or substance that is listed or regulated under applicable Laws as a “hazardous” or “toxic” substance or waste, or as a “contaminant” or “pollutant” or words of similar import, (b) any petroleum or petroleum products, flammable materials, explosives, radioactive materials, asbestos, urea formaldehyde foam insulation, and transformers or other equipment that contain polychlorinated biphenyls, and (c) any other chemical or other material or substance, exposure to which is prohibited, limited or regulated by any Laws.
“Imbalance Energy” means the amount of energy in MWh, in any given Settlement Period or Settlement Interval, by which the amount of Facility Energy deviates from the amount of Scheduled Energy.
“Indemnifiable Loss(es)” has the meaning set forth in Section 16.1. “Indemnified Group” has the meaning set forth in Section 16.1. “Initial Synchronization” means the initial delivery of Facility Energy to the Delivery Point.
“Installed Capacity” means the sum of (x) the Installed PV Capacity and (y) the Installed Battery Capacity.
“Installed Battery Capacity” means the maximum dependable operating capability of the Storage Facility to discharge electric energy, as measured in MW(ac) at the Delivery Point, that achieves Commercial Operation, adjusted for ambient conditions on the date of the performance test, and as evidenced by a certificate substantially in the form attached as Exhibit I hereto. “Installed PV Capacity” means the actual generating capacity of the Generating Facility, as measured in MW(ac) at the Delivery Point, that achieves Commercial Operation, adjusted for ambient conditions on the date of the performance test, and as evidenced by a certificate substantially in the form attached as Exhibit I hereto. “Interconnection Agreement” means the interconnection agreement entered into by Seller pursuant to which the Facility will be interconnected with the Transmission System, and Attachment Staff Report Item 15C
13 pursuant to which Seller’s Interconnection Facilities and any other Interconnection Facilities will be constructed, operated and maintained during the Contract Term. “Interconnection Facilities” means the interconnection facilities, control and protective devices and metering facilities required to connect the Facility with the Transmission System in accordance with the Interconnection Agreement.
“Interest Rate” has the meaning set forth in Section 8.2. “Interim Deliverability Status” has the meaning set forth in the CAISO Tariff. “Inter-SC Trade” or “IST” has the meaning set forth in the CAISO Tariff. “Investment Grade Credit Rating” means a Credit Rating of or higher by S&P or Baa3 or higher by Moody’s.
“ITC” means the investment tax credit established pursuant to Section 48 of the United States Internal Revenue Code of 1986.
“Joint Powers Act” means the Joint Exercise of Powers Act of the State of California (Government Code Section 6500 et seq.).
“Joint Powers Agreement” means that certain Joint Powers Agreement dated December 1, 2016, as amended from time to time, under which Buyer is organized as a Joint Powers Authority in accordance with the Joint Powers Act.
“Law” means any applicable law, statute, rule, regulation, decision, writ, order, decree or judgment, permit or any interpretation thereof, promulgated or issued by a Governmental Authority.
“Lender” means, collectively, any Person (i) providing senior or subordinated construction, interim, back leverage or long-term debt, equity, cash equity or tax equity financing or refinancing for or in connection with the development, construction, purchase, installation or operation of the Facility, whether that financing or refinancing takes the form of private debt (including back-leverage debt), equity (including cash equity and tax equity), public debt or any other form (including financing or refinancing provided to a member or other direct or indirect owner of Seller), including any equity, cash equity or tax equity investor directly or indirectly providing financing or refinancing for the Facility or purchasing equity ownership interests of Seller or its Affiliates, and any trustee or agent or similar representative acting on their behalf, (ii) providing Interest Rate or commodity protection under an agreement hedging or otherwise mitigating the cost of any of the foregoing obligations or (iii) participating in a lease financing (including a sale leaseback or leveraged leasing structure) with respect to the Facility. “Letter(s) of Credit” means one or more irrevocable, standby letters of credit issued by a U.S. commercial bank or a foreign bank with a U.S. branch with such bank (a) having a Credit Rating of at least with an outlook designation of “stable” from S&P or with an outlook designation of “stable” from Moody’s or (b) being reasonably acceptable to Buyer, in a form substantially similar to the letter of credit set forth in Exhibit K.

Attachment Staff Report Item 15C
14 “Licensed Professional Engineer” means an independent, professional engineer selected by Seller and reasonably acceptable to Buyer, licensed in the State of California. “Local Capacity Area Resources” has the meaning set forth in the CAISO Tariff. “Locational Marginal Price” or “LMP” has the meaning set forth in the CAISO Tariff. “Losses” means, with respect to any Party, an amount equal to the present value of the economic loss to it, if any (exclusive of Costs), resulting from termination of this Agreement for the remaining Contract Term, determined in a commercially reasonable manner. Factors used in determining economic loss to a Party may include, without limitation, reference to information supplied by one or more third parties, which shall exclude Affiliates of the Non-Defaulting Party, including without limitation, quotations (either firm or indicative) of relevant rates, prices, yields, yield curves, volatilities, spreads or other relevant market data in the relevant markets, comparable transactions, forward price curves based on economic analysis of the relevant markets, settlement prices for comparable transactions at liquid trading hubs (e.g., SP-15), all of which should be calculated for the remaining Contract Term and must include the value of Green Attributes, Capacity Attributes, and Renewable Energy Incentives.
“Lost Output” has the meaning set forth in Section 4.7. “Major Project Development Milestone” has the meaning set forth in in Exhibit B. “Master File” has the meaning set forth in the CAISO Tariff. “Maximum Charging Capacity” has the meaning set forth in in Exhibit A. “Maximum Discharging Capacity” has the meaning set forth in in Exhibit A. “Milestones” means the development activities for significant permitting, interconnection, financing and construction milestones set forth on the Cover Sheet. “Monthly Delivery Forecast” has the meaning set forth in Section 4.3(b). “Monthly Storage Availability” has the meaning set forth in Exhibit P. “Moody’s” means Moody’s Investors Service, Inc., or its successor. “MW” means megawatts in alternating current, unless expressly stated in terms of direct current.
“MWh” means megawatt-hour measured in alternating current, unless expressly stated in terms of direct current.
“Negative LMP” means, in any Settlement Period or Settlement Interval, the Real-Time Price at the Facility’s PNode is less than
“NERC” means the North American Electric Reliability Corporation or any successor entity performing similar functions.

Attachment Staff Report Item 15C
Attachment Staff Report Item 15C
16 “Person” means any individual, sole proprietorship, corporation, limited liability company, limited or general partnership, joint venture, association, joint-stock company, trust, incorporated organization, institution, public benefit corporation, unincorporated organization, government entity or other entity.
“PNode” has the meaning set forth in the CAISO Tariff.
“Planned Outage” has the meaning set forth in Section 4.6(a). “Portfolio” means the single portfolio of electrical energy generating or other assets and entities, including the Facility (or the interests of Seller or Seller’s Affiliates or the interests of their respective direct or indirect parent companies), that is pledged as collateral security in connection with a Portfolio Financing.
“Portfolio Content Category” means PCC1, PCC2 or PCC3, as applicable. “Portfolio Content Category 1” or “PCC1” means any Renewable Energy Credit associated with the generation of electricity from an Eligible Renewable Energy Resource consisting of the portfolio content set forth in California Public Utilities Code Section 399.16(b)(1), as may be amended from time to time or as further defined or supplemented by Law.
“Portfolio Content Category 2” or “PCC2” means any Renewable Energy Credit associated with the generation of electricity from an Eligible Renewable Energy Resource consisting of the portfolio content set forth in California Public Utilities Code Section 399.16(b)(2), as may be amended from time to time or as further defined or supplemented by Law.
“Portfolio Content Category 3” or “PCC3” means any Renewable Energy Credit associated with the generation of electricity from an Eligible Renewable Energy Resource consisting of the portfolio content set forth in California Public Utilities Code Section 399.16(b)(3), as may be amended from time to time or as further defined or supplemented by Law.
“Portfolio Financing” means any debt incurred by an Affiliate of Seller that is secured only by a Portfolio.
“Portfolio Financing Entity” means any Affiliate of Seller that incurs debt in connection with any Portfolio Financing.
“Product” has the meaning set forth on the Cover Sheet. “Progress Report” means a progress report including the items set forth in Exhibit E. “Prudent Operating Practice” means (a) the applicable practices, methods and acts required by or consistent with applicable Laws and reliability criteria, and otherwise engaged in or approved by a significant portion of the electric utility industry during the relevant time period with respect to grid-interconnected, utility-scale generating facilities with integrated storage in the Attachment Staff Report Item 15C
17 Western United States, or (b) any of the practices, methods and acts which, in the exercise of reasonable judgment in light of the facts known at the time the decision was made, could have been expected to accomplish the desired result at a reasonable cost consistent with good business practices, reliability, safety and expedition. Prudent Operating Practice is not intended to be limited to the optimum practice, method or act to the exclusion of all others, but rather to acceptable practices, methods or acts generally accepted in the industry with respect to grid-interconnected, utility-scale generating facilities with integrated storage in the Western United States. Prudent Operating Practice includes compliance with applicable Laws, applicable reliability criteria, and the criteria, rules and standards promulgated in the National Electric Safety Code and the National Electrical Code, as they may be amended or superseded from time to time, including the criteria, rules and standards of any successor organizations. “PTC” means the production tax credit established pursuant to Section 45 of the United States Internal Revenue Code of 1986.
“PV Energy” means that portion of Energy that is delivered from the Generating Facility directly to the Delivery Point, net of Electrical Losses, and is not Charging Energy. “RA Deficiency Amount” means the liquidated damages payment that Seller shall pay to Buyer for an applicable RA Shortfall Month as calculated in accordance with Section 3.8(b). “RA Guarantee Date” means the Commercial Operation Date. “RA Shortfall Month” means, for purposes of calculating an RA Deficiency Amount under Section 3.8(b), the extent to which during any month the Net Qualifying Capacity of the Facility for such month was less than the Adjusted Qualifying Capacity of the Facility for such month due to (a) the Facility not having achieved Full Capacity Deliverability Status, (b) a Planned Outage, (c) a Forced Facility Outage, and (d) the CAISO’s reduction in Facility NQC due to the Facility’s actual Forced Facility Outage rate (i.e., past performance). “Real-Time Forecast” means any Notice of any change to the Available Generating Capacity, Storage Capacity, or hourly expected Energy delivered by or on behalf of Seller pursuant to Section 4.3(d).
“Real-Time Market” has the meaning set forth in the CAISO Tariff. “Real-Time Price” means the Resource-Specific Settlement Interval LMP as defined in the CAISO Tariff. If there is more than one applicable Real-Time Price for the same period of time, Real-Time Price shall mean the price associated with the smallest time interval. “Remedial Action Plan” has the meaning in Section 2.4.
“Renewable Energy Credit” has the meaning set forth in California Public Utilities Code Section 399.12(h), as may be amended from time to time or as further defined or supplemented by Law.
“Renewable Energy Incentives” means: (a) all federal, state, or local Tax credits or other Tax benefits associated with the construction, ownership, or production of electricity from the Attachment Staff Report Item 15C
18 Facility (including credits under Sections 38, 45, 46 and 48 of the Internal Revenue Code of 1986, as amended); (b) any federal, state, or local grants, subsidies or other like benefits relating in any way to the Facility; and (c) any other form of incentive relating in any way to the Facility that is not a Green Attribute or a Future Environmental Attribute. “Renewable Rate” has the meaning set forth on the Cover Sheet. “Replacement RA” means Resource Adequacy Benefits, if any, equivalent to those that would have been provided by the Facility with respect to the applicable month in which a RA Deficiency Amount is due to Buyer, and located within NP 15 or Greater Bay Area Local Capacity Area Resource.
“Resource Adequacy Benefits” means the rights and privileges attached to the Facility that satisfy any entity’s resource adequacy obligations, as those obligations are set forth in any Resource Adequacy Rulings and includes any local, zonal or otherwise locational attributes associated with the Facility, in addition to flex attributes. “Resource Adequacy Rulings” means CPUC Decisions 04-01-050, 04-10-035, 05-10-042, 06-04-040, 06-06-064, 06-07-031 06-07-031, 07-06-029, 08-06-031, 09-06-028, 10-06-036, 11-06-022, 12-06-025, 13-06-024 and any other existing or subsequent ruling or decision, or any other resource adequacy Law, however described, as such decisions, rulings, Laws, rules or regulations may be amended or modified from time-to-time throughout the Delivery Term.
“S&P” means the Standard & Poor’s Financial Services, LLC (a subsidiary of The McGraw-Hill Companies, Inc.) or its successor.
“Schedule” has the meaning set forth in the CAISO Tariff, and “Scheduled” has a corollary meaning.
“Scheduled Energy” means the Facility Energy that clears under the applicable CAISO market based on the final Day-Ahead Schedule, FMM Schedule (as defined in the CAISO Tariff), or any other financially binding Schedule, market instruction or dispatch for the Facility for a given period of time implemented in accordance with the CAISO Tariff. “Scheduling Coordinator” or “SC” means an entity certified by the CAISO as qualifying as a Scheduling Coordinator pursuant to the CAISO Tariff for the purposes of undertaking the functions specified in “Responsibilities of a Scheduling Coordinator,” of the CAISO Tariff, as amended from time to time.
“Security Interest” has the meaning set forth in Section 8.8. “Self-Schedule” has the meaning set forth in the CAISO Tariff. “Seller” has the meaning set forth on the Cover Sheet.
“Seller’s WREGIS Account” has the meaning set forth in Section 4.10(a).

Attachment Staff Report Item 15C
19 “Settlement Amount” means the Non-Defaulting Party’s Costs and Losses, on the one hand, netted against its Gains, on the other. If the Non-Defaulting Party’s Costs and Losses exceed its Gains, then the Settlement Amount shall be an amount owing to the Non-Defaulting Party. If the Non-Defaulting Party’s Gains exceed its Costs and Losses, then the Settlement Amount shall be The Settlement Amount does not include consequential, incidental, punitive, exemplary or indirect or business interruption damages. “Settlement Interval” has the meaning set forth in the CAISO Tariff. “Settlement Period” has the meaning set forth in the CAISO Tariff. “Shared Facilities” means the gen-tie lines, transformers, substations, or other equipment, permits, contract rights, and other assets and property (real or personal), in each case, as necessary to enable delivery of energy from the Facility (which is excluded from Shared Facilities) to the point of interconnection, including the Interconnection Agreement itself, that are used in common with third parties.
“Site” means the real property on which the Facility is or will be located, as further described in Exhibit A, and as shall be updated by Seller at the time Seller provides an executed Construction Start Date certificate in the form of Exhibit J to Buyer. “Site Control” means that Seller (or, prior to the Delivery Term, its Affiliate): (a) owns or has the option to purchase the Site; (b) is the lessee or has the option to lease the Site; or (c) is the holder of an easement or an option for an easement, right-of-way grant, or similar instrument with respect to the Site.
“Station Use” means:
(a) The Energy produced or discharged by the Facility that is used within the Facility to power the lights, motors, control systems and other electrical loads that are necessary for operation of the Facility; and
(b) The Energy produced or discharged by the Facility that is consumed within the Facility’s electric energy distribution system as losses. “Storage Capacity” means (a) the maximum dependable operating capability of the Storage Facility to discharge electric energy that can be sustained for four (4) consecutive hours and (b) any other products that may be developed or evolve from time to time during the Term that the Storage Facility is able to provide as the Facility is configured on the Commercial Operation Date and that relate to the maximum dependable operating capability of the Storage Facility to discharge electric energy.
“Storage Capacity Test” means any test or retest of the capacity of the Storage Facility conducted in accordance with the testing procedures, requirements and protocols set forth in Section 4.9 and Exhibit O.
“Storage Contract Capacity” means the total capacity (in MW) of the Storage Facility initially equal to the amount set forth on the Cover Sheet, as the same may be adjusted from time Attachment Staff Report Item 15C
20 to time pursuant to Section 5(b) of Exhibit B or Section 4.9 and Exhibit O to reflect the results of the most recently performed Storage Capacity Test.
“Storage Facility” means the energy storage facility described on the Cover Sheet and in Exhibit A (including the operational requirements of the energy storage facility), located at the Site and including mechanical equipment and associated facilities and equipment required to deliver Storage Product (but excluding any Shared Facilities), and as such storage facility may be expanded or otherwise modified from time to time in accordance with the terms of this Agreement. “Storage Facility Loss Factor” is set forth on the Cover Sheet and represents the result of subtracting from the number one (1) the percentage of Electrical Losses associated with converting Charging Energy to Discharging Energy. For example, if the conversion of Charging Energy to Discharging Energy caused a ten percent (10%) loss in Energy, the Storage Facility Loss Factor would be (.90).
“Storage Facility Meter” means the bi-directional revenue quality meter or meters (with a 0.3 accuracy class), along with a compatible data processing gateway or remote intelligence gateway, telemetering equipment and data acquisition services sufficient for monitoring, recording and reporting, in real time, the amount of Charging Energy delivered to the Storage Facility Metering Points and the amount of Discharging Energy discharged from the Storage Facility at the Storage Facility Metering Points to the Delivery Point for the purpose of invoicing in accordance with Section 8.1. For clarity, the Facility will contain multiple measurement devices that will make up the Storage Facility Meter, and, unless otherwise indicated, references to the Storage Facility Meter shall mean all such measurement devices and the aggregated data of all such measurement devices, taken together.
“Storage Facility Metering Points” means the locations of the Storage Facility Meters shown on Exhibit R.
“Storage Minimum Capacity Factor” means the sum of the Monthly Storage Availability for the applicable Contract Year, divided by twelve (12). “Storage Product” means (a) Discharging Energy, (b) Capacity Attributes, if any, (c) Storage Capacity, and (d) Ancillary Services (as defined in the CAISO Tariff), if any, in each case arising from or relating to the Storage Facility.
“Storage Rate” has the meaning set forth on the Cover Sheet. “Stored Energy Level” means, at a particular time, the amount of electric energy in the Storage Facility available to be discharged as Discharging Energy, expressed in MWh. “System Emergency” means any condition that requires, as determined and declared by CAISO or the PTO, automatic or immediate action to (i) prevent or limit harm to or loss of life or property, (ii) prevent loss of transmission facilities or generation supply in the immediate vicinity of the Facility, or (iii) to preserve Transmission System reliability. “Tax” or “Taxes” means all U.S. federal, state and local and any foreign taxes, levies, assessments, surcharges, duties and other fees and charges of any nature imposed by a Attachment Staff Report Item 15C
Attachment Staff Report Item 15C
22 1.2 Rules of Interpretation. In this Agreement, except as expressly stated otherwise or unless the context otherwise requires:
(a) headings and the rendering of text in bold and italics are for convenience and reference purposes only and do not affect the meaning or interpretation of this Agreement; (b) words importing the singular include the plural and vice versa and the masculine, feminine and neuter genders include all genders; (c) the words “hereof”, “herein”, and “hereunder” and words of similar import shall refer to this Agreement as a whole and not to any particular provision of this Agreement; (d) a reference to an Article, Section, paragraph, clause, Party, or Exhibit is a reference to that Section, paragraph, clause of, or that Party or Exhibit to, this Agreement unless otherwise specified;
(e) a reference to a document or agreement, including this Agreement means such document, agreement or this Agreement including any amendment or supplement to, or replacement, novation or modification of this Agreement, but disregarding any amendment, supplement, replacement, novation or modification made in breach of such document, agreement or this Agreement;
(f) a reference to a Person includes that Person’s successors and permitted assigns;
(g) the term “including” means “including without limitation” and any list of examples following such term shall in no way restrict or limit the generality of the work or provision in respect of which such examples are provided; (h) references to any statute, code or statutory provision are to be construed as a reference to the same as it may have been, or may from time to time be, amended, modified or reenacted, and include references to all bylaws, instruments, orders and regulations for the time being made thereunder or deriving validity therefrom unless the context otherwise requires; (i) in the event of a conflict, a mathematical formula or other precise description of a concept or a term shall prevail over words providing a more general description of a concept or a term;
(j) references to any amount of money shall mean a reference to the amount in United States Dollars;
(k) words, phrases or expressions not otherwise defined herein that (i) have a generally accepted meaning in Prudent Operating Practice shall have such meaning in this Agreement or (ii) do not have well known and generally accepted meaning in Prudent Operating Practice but that have well known and generally accepted technical or trade meanings, shall have such recognized meanings; and
Attachment Staff Report Item 15C
23 (l) each Party acknowledges that it was represented by counsel in connection with this Agreement and that it or its counsel reviewed this Agreement and that any rule of construction to the effect that ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of this Agreement.

ARTICLE 2
TERM; CONDITIONS PRECEDENT

2.1 Contract Term.
(a) The term of this Agreement shall commence on the Effective Date and shall remain in full force and effect until the conclusion of the Delivery Term, subject to any early termination provisions and any contract term extension provisions set forth herein (“Contract Term”); provided, however, that subject to Buyer’s obligations in Section 3.6, Buyer’s obligations to pay for or accept any Product are subject to Seller’s completion of the conditions precedent pursuant to Section 2.2.
(b) Applicable provisions of this Agreement shall continue in effect after termination, including early termination, to the extent necessary to enforce or complete the duties, obligations or responsibilities of the Parties arising prior to termination. The confidentiality obligations of the Parties under Article 18 and all indemnity and audit rights shall remain in full force and effect for two (2) years following the termination of this Agreement.

2.2 Conditions Precedent. The Delivery Term shall not commence until Seller completes each of the following conditions:
(a) Seller has delivered to Buyer (i) a completion certificate from a Licensed Professional Engineer substantially in the form of Exhibit H and (ii) a certificate from a Licensed Professional Engineer substantially in the form of Exhibit I setting forth the Installed Capacity on the Commercial Operation Date;
(b) A Participating Generator Agreement and a Meter Service Agreement between Seller and CAISO shall have been executed and delivered and be in full force and effect, and a copy of each such agreement delivered to Buyer;
(c) An Interconnection Agreement between Seller and the PTO shall have been executed and delivered and be in full force and effect and a copy of the Interconnection Agreement delivered to Buyer;
(d) All applicable regulatory authorizations, approvals and permits required to achieve commercial operations of the Facility have been obtained and all applicable conditions thereof that are capable of being satisfied on or before the Commercial Operation Date have been satisfied and shall be in full force and effect;
(e) Seller has received CEC Precertification of the Facility; (f) Seller (with the reasonable participation of Buyer) shall have completed all applicable WREGIS registration requirements that are reasonably capable of being completed Attachment Staff Report Item 15C
Attachment Staff Report Item 15C
25 ARTICLE 3

PURCHASE AND SALE

3.1 Purchase and Sale of Product. Subject to the terms and conditions of this Agreement, during the Delivery Term, Buyer will purchase all the Product produced by or associated with the Facility at the Contract Price and in accordance with Exhibit C, and Seller shall supply and deliver to Buyer all the Product produced by or associated with the Facility (net of applicable losses). At its sole discretion, Buyer may during the Delivery Term re-sell or use for another purpose all or a portion of the Product, provided that no such re-sale or use shall relieve Buyer of any obligations hereunder. During the Delivery Term, Buyer will have exclusive rights to offer, bid, or otherwise submit the Product, or any Capacity Attributes thereof, from the Facility after the Delivery Point for resale in the market, and retain and receive any and all related revenues.

Subject to Buyer’s obligation to purchase Capacity Attributes and Storage Product in accordance with this Section 3.1 and Exhibit C, Buyer has no obligation to purchase from Seller any Product for which the associated Facility Energy is not or cannot be delivered to the Delivery Point as a result of an outage of the Facility, a Force Majeure Event, or a Curtailment Order.

3.2 Sale of Green Attributes. During the Delivery Term, Seller shall sell and deliver to Buyer, and Buyer shall purchase from Seller, all Green Attributes attributable to the Facility Energy generated by the Facility.

3.3 Imbalance Energy. Buyer and Seller recognize that in any given Settlement Period the amount of Facility Energy delivered may be greater or less than the amount of energy scheduled with the CAISO. To the extent there is such imbalance energy, any payments or charges from the CAISO associated with such imbalance energy shall be solely for the account of Buyer.

3.4 Ownership of Renewable Energy Incentives. Seller shall have all right, title and interest in and to all Renewable Energy Incentives. Buyer acknowledges that any Renewable Energy Incentives belong to Seller. If any Renewable Energy Incentives, or values representing the same, are initially credited or paid to Buyer, Buyer shall cause such Renewable Energy Incentives or values relating to same to be assigned or transferred to Seller without delay. Buyer shall reasonably cooperate with Seller, at Seller’s sole expense, in Seller’s efforts to meet the requirements for any certification, registration, or reporting program relating to Renewable Energy Incentives.

3.5 Future Environmental Attributes.
(a) The Parties acknowledge and agree that as of the Effective Date, environmental attributes sold under this Agreement are restricted to Green Attributes; however, Future Environmental Attributes may be created by a Governmental Authority through Laws enacted after the Effective Date. Subject to the final sentence of this Section 3.5(a), and Sections

3.5(b), in such event, Buyer shall bear all costs and risks associated with the transfer, qualification, verification, registration and ongoing compliance for such Future Environmental Attributes, but there shall be no increase in the Contract Price. Upon Seller’s receipt of Notice from Buyer of Buyer’s intent to claim such Future Environmental Attributes, the Parties shall determine the necessary actions and additional costs associated with such Future Environmental Attributes.

Seller shall have no obligation to bear any costs, losses or liability, or alter the Facility, unless the Attachment Staff Report Item 15C
26 Parties have agreed on all necessary terms and conditions relating to such alteration and Buyer has agreed to reimburse Seller for all costs, losses, and liabilities associated with such alteration. (b) If Buyer elects to receive Future Environmental Attributes pursuant to Section 3.5(a), the Parties agree to negotiate in good faith with respect to the development of further agreements and documentation necessary to effectuate the transfer of such Future Environmental Attributes, including agreement with respect to (i) appropriate transfer, delivery and risk of loss mechanisms, and (ii) appropriate allocation of any additional costs to Buyer, as set forth above (in any event subject to Section 3.12); provided, that the Parties acknowledge and agree that (i) Seller shall not be required to bear any costs, losses or liability arising therefrom, (ii) Seller shall not be required to alter the Facility, and (iii) such terms are not intended to alter the other material terms of this Agreement.

3.6 Test Energy. No less than days prior to the first day on which Test Energy is expected to be available from the Facility, Seller shall notify Buyer of the availability of the Test Energy. If and to the extent the Facility generates Test Energy, Seller shall sell and Buyer shall purchase from Seller all Test Energy and any associated Products on an as-available basis for up to ninety (90) days from the first delivery of Test Energy. As compensation for such Test Energy and associated Product, Buyer shall pay Seller an amount equal to (the “Test Energy Rate”). For the avoidance of doubt, the conditions precedent in Section 2.2 are not applicable to the Parties’ obligations under this Section

3.6. 3.7 Capacity Attributes. Seller shall request Full Capacity Deliverability Status in the CAISO generator interconnection process. As between Buyer and Seller, Seller shall be responsible for the cost and installation of any Network Upgrades associated with obtaining such Full Capacity Deliverability Status.
(a) Throughout the Delivery Term, and subject to Section 3.12, Seller grants, pledges, assigns and otherwise commits to Buyer all the Capacity Attributes from the Facility. (b) Throughout the Delivery Term, and subject to Section 3.12, Seller shall use commercially reasonable efforts to maintain eligibility for Full Capacity Deliverability Status or Interim Deliverability Status for the Facility from the CAISO and shall perform all actions necessary to ensure that the Facility qualifies to provide Resource Adequacy Benefits to Seller.

Throughout the Delivery Term, and subject to Section 3.12, Seller hereby covenants and agrees to transfer all Resource Adequacy Benefits to Buyer.
(c) For the duration of the Delivery Term, and subject to Section 3.12, Seller shall take all commercially reasonable administrative actions, including complying with all applicable registration and reporting requirements, and execute all documents or instruments necessary to enable Buyer to use all of the Capacity Attributes committed by Seller to Buyer pursuant to this Agreement.

Attachment Staff Report Item 15C
Attachment Staff Report Item 15C
28 Facility is tracked for purposes of satisfying the California Renewables Portfolio Standard requirements, as may be amended or supplemented by the CPUC or CEC from time to time.

3.12 Compliance Expenditure Cap. If a change in Laws occurring after the Effective Date has increased Seller’s known or reasonably expected costs to comply with Seller’s obligations under this Agreement with respect to obtaining, maintaining, conveying or effectuating Buyer’s use of (as applicable) any Product (including any obligations set forth in Section 3.9, 3.10, 4.3(f) or 4.4(d) then the Parties agree that the maximum aggregate amount of costs and expenses Seller shall be required to bear during the Delivery Term to comply with all of such obligations shall be capped at
(“Compliance Expenditure Cap”).

Any actions required for Seller to comply with its obligations set forth in the first paragraph above, the cost of which will be included in the Compliance Expenditure Cap, shall be referred to collectively as the “Compliance Actions.”
If Seller reasonably anticipates the need to incur out-of-pocket expenses in excess of the Compliance Expenditure Cap in order to take any Compliance Action Seller shall provide Notice to Buyer of such anticipated out-of-pocket expenses.

Buyer will have sixty (60) days to evaluate such Notice (during which time period Seller is not obligated to take any Compliance Actions described in the Notice) and shall, within such time, either (1) agree to reimburse Seller for all or some portion of the costs that exceed the Compliance Expenditure Cap (such Buyer-agreed upon costs, the “Accepted Compliance Costs”), or (2) waive Seller’s obligation to take such Compliance Actions, or any part thereof for which Buyer has not agreed to reimburse Seller.

If Buyer agrees to reimburse Seller for the Accepted Compliance Costs, then Seller shall take such Compliance Actions covered by the Accepted Compliance Costs as agreed upon by the Parties and Buyer shall reimburse Seller for Seller’s actual costs to effect the Compliance Actions, not to exceed the Accepted Compliance Costs, within sixty (60) days from the time that Buyer receives an invoice and documentation of such costs from Seller.

3.13 Project Configuration. In order to optimize the benefits of the Facility, Buyer and Seller each agree that if requested by the other Party, then Buyer and Seller will discuss in good faith potential reconfiguration of the Facility or Interconnection Facilities (including enabling the Storage Facility to be charged from the grid); provided that neither Party shall be obligated to agree to any changes under this Agreement, or to incur any expense in connection with such changes, except under terms mutually acceptable to both Parties (and Seller’s Lenders) as set forth in a written agreement.

ARTICLE 4

OBLIGATIONS AND DELIVERIES

4.1 Delivery.
(a) Energy. Buyer shall make all necessary arrangements to receive the Metered Energy at the Delivery Point prior to the Commercial Operation Date. Subject to the Attachment Staff Report Item 15C
29 provisions of this Agreement, commencing on the Commercial Operation Date through the end of the Contract Term, Seller shall supply and deliver the Product to Buyer at the Delivery Point, and Buyer shall take delivery of the Product at the Delivery Point in accordance with the terms of this Agreement. Seller will be responsible for paying or satisfying when due any costs or charges imposed in connection with the delivery of Facility Energy to the Delivery Point, including without limitation (but without limiting Buyer’s obligation to pay amounts associated with the Storage Facility Loss Factor as expressly provided herein), Station Use, Electrical Losses, any costs associated with delivering the Charging Energy from the Generating Facility to the Storage Facility, and any operation and maintenance charges imposed by the Transmission Provider directly relating to the Facility’s operations. Buyer shall be responsible for all costs, charges and penalties, if any, imposed in connection with the delivery of Facility Energy at and after the Delivery Point, including without limitation transmission costs and transmission line losses and imbalance charges. The Facility Energy will be scheduled to the CAISO by Buyer (or Buyer’s designated Scheduling Coordinator) in accordance with Exhibit D. (b) Green Attributes. All Green Attributes associated with the Facility during the Delivery Term are exclusively dedicated to and vested in Buyer. Seller represents and warrants that Seller holds the rights to all Green Attributes from the Facility, and Seller agrees to convey and hereby conveys all such Green Attributes to Buyer as included in the delivery of the Product from the Facility.

4.2 Title and Risk of Loss.
(a) Energy. Title to and risk of loss related to the Facility Energy, shall pass and transfer from Seller to Buyer at the Delivery Point. Seller warrants that all Product delivered to Buyer is free and clear of all liens, security interests, claims and encumbrances of any kind. (b) Green Attributes. Title to and risk of loss related to the Green Attributes shall pass and transfer from Seller to Buyer upon the transfer of such Green Attributes in accordance with WREGIS.

4.3 Forecasting. Seller shall provide the forecasts described below at its sole expense and in a format reasonably acceptable to Buyer (or Buyer’s designee). Seller shall use reasonable efforts to provide forecasts that are accurate and, to the extent not inconsistent with the requirements of this Agreement, shall prepare such forecasts, or cause such forecasts to be prepared, in accordance with Prudent Operating Practices. (a) Annual Forecast of Energy. No less than forty-five (45) days before (i) the first day of the first Contract Year of the Delivery Term and (ii) at the beginning of each calendar year for every subsequent Contract Year during the Delivery Term, Seller shall provide to Buyer and the SC (if applicable) a non-binding forecast of each month’s average-day Expected Energy, by hour, for the following calendar year in a form substantially similar to the table found in Exhibit F-1, or as reasonably requested by Buyer.
(b) Monthly Forecast of Energy and Available Generating Capacity. No less than thirty (30) days before the beginning of Commercial Operation, and thereafter ten (10) Business Days before the beginning of each month during the Delivery Term, Seller shall provide Attachment Staff Report Item 15C
30 to Buyer and the SC (if applicable) a non-binding forecast of the hourly expected Energy, Available Generating Capacity and Storage Capacity for each day of the following month in a form substantially similar to the table found in Exhibit F-2 (“Monthly Delivery Forecast”). (c) Day-Ahead Forecast. By 5:30 AM Pacific Prevailing Time on the Business Day immediately preceding the date of delivery, or as otherwise specified by Buyer consistent with Prudent Operating Practice, Seller shall provide Buyer with a non-binding forecast of (i) Available Generating Capacity and (ii) Storage Capacity and (iii) hourly expected Energy, in each case, for each hour of the immediately succeeding day (“Day-Ahead Forecast”). A Day-Ahead Forecast provided in a day prior to any non-Business Day(s) shall include non-binding forecasts for the immediate day, each succeeding non-Business Day and the next Business Day.

Each Day-Ahead Forecast shall clearly identify, for each hour, Seller’s best estimate of (i) the Available Generating Capacity and (ii) the Storage Capacity and (iii) the hourly expected Energy.

These Day-Ahead Forecasts shall be sent to Buyer’s on-duty Scheduling Coordinator. If Seller fails to provide Buyer with a Day-Ahead Forecast as required herein for any period, then for such unscheduled delivery period only Buyer shall rely on any Real-Time Forecast provided in accordance with Section 4.3(d) or the Monthly Delivery Forecast or Buyer’s best estimate based on information reasonably available to Buyer.
(d) Real-Time Forecasts. During the Delivery Term, Seller shall notify Buyer of any changes from the Day-Ahead Forecast of one (1) MW or more in (i) Available Generating Capacity or (ii) Storage Capacity or (iii) hourly expected Energy, in each case, whether due to Forced Facility Outage, Force Majeure or other cause, as soon as reasonably possible, but no later than one (1) hour prior to the deadline for submitting Schedules to the CAISO in accordance with the rules for participation in the Real-Time Market. If the Available Generating Capacity, Storage Capacity, or hourly expected Energy changes by at least one (1) MW as of a time that is less than one (1) hour prior to the Real-Time Market deadline, but before such deadline, then Seller must notify Buyer as soon as reasonably possible. Such Real-Time Forecasts of Energy shall be provided by an Approved Forecast Vendor and shall contain information regarding the beginning date and time of the event resulting in the change in Available Generating Capacity, Storage Capacity, or hourly expected Energy, as applicable, the expected end date and time of such event, and any other information required by the CAISO or reasonably requested by Buyer. With respect to any Forced Facility Outage, Seller shall use commercially reasonable efforts to notify Buyer of such outage within ten (10) minutes of the commencement of the Forced Facility Outage. Seller shall inform Buyer of any developments that will affect either the duration of such outage or the availability of the Facility during or after the end of such outage. These Real-Time Forecasts shall be communicated in a method reasonably acceptable to Buyer; provided that Buyer specifies the method no later than twenty (20) Business Days prior to the effective date of such requirement. In the event Buyer fails to provide Notice of an acceptable method for communications under this Section 4.3(d), then Seller shall send such communications by telephone and e-mail to Buyer. (e) Forced Facility Outages. Notwithstanding anything to the contrary herein, Seller shall promptly notify Buyer’s on-duty Scheduling Coordinator of Forced Facility Outages and Seller shall keep Buyer informed of any developments that will affect either the duration of the outage or the availability of the Facility during or after the end of the outage.

Attachment Staff Report Item 15C
Attachment Staff Report Item 15C
32 Term Seller’s facilities, communications links or other equipment, protocols or practices are not in compliance with then-current methodologies, Seller shall take the steps necessary to become compliant as soon as reasonably possible. Seller shall be liable pursuant to Section 4.4(c) for failure to comply with a Buyer Curtailment Order, Buyer Bid Curtailment or Curtailment Order, during the time that Seller’s facilities, communications links or other equipment, protocols or practices are not in compliance with then-current methodologies. For the avoidance of doubt, a Buyer Curtailment Order, Buyer Bid Curtailment or Curtailment Order communication via such systems and facilities shall have the same force and effect on Seller as any other form of communication.

4.5 Charging Energy Management.
(a) Upon receipt of a valid Charging Notice, Seller shall take any and all action necessary to deliver the Charging Energy from the Generating Facility to the Storage Facility in order to deliver the Storage Product in accordance with the terms of this Agreement (including the Operating Restrictions), including maintenance, repair or replacement of equipment in Seller’s possession or control used to deliver the Charging Energy from the Generating Facility to the Storage Facility.
(b) Buyer will have the right to charge the Storage Facility seven (7) days per week and twenty-four (24) hours per day (including holidays), by providing Charging Notices to Seller electronically, provided, that Buyer’s right to issue Charging Notices is subject to Prudent Operating Practice and the requirements and limitations set forth in this Agreement, including the Operating Restrictions and the provisions of Section 4.5(a). Each Charging Notice issued in accordance with this Agreement will be effective unless and until Buyer modifies such Charging Notice by providing Seller with an updated Charging Notice. (c) Seller shall not charge the Storage Facility during the Term other than pursuant to a valid Charging Notice, or in connection with a Storage Capacity Test, or pursuant to a notice from CAISO, the PTO, Transmission Provider, or any other Governmental Authority. If, during the Contract Term, Seller (a) charges the Storage Facility to a Stored Energy Level greater than the Stored Energy Level provided for in the Charging Notice or (b) charges the Storage Facility in violation of the first sentence of this Section 4.5(c), then (x) Seller shall be responsible for all energy costs associated with such charging of the Storage Facility, (y) Buyer shall not be required to pay for the charging of such energy (i.e., Charging Energy), and (z) Buyer shall be entitled to discharge such energy and entitled to all of the benefits (including Storage Product) associated with such discharge.
(d) Buyer will have the right to discharge the Storage Facility seven (7) days per week and twenty-four (24) hours per day (including holidays), by providing Discharging Notices to Seller electronically, and subject to the requirements and limitations set forth in this Agreement, including the Operating Procedures. Each Discharging Notice issued in accordance with this Agreement will be effective unless and until Buyer modifies such Discharging Notice by providing Seller with an updated Discharging Notice.
(e) Notwithstanding anything in this Agreement to the contrary, during any Settlement Interval, Curtailment Orders, Buyer Curtailment Orders, and Buyer Bid Curtailments Attachment Staff Report Item 15C
33 applicable to such Settlement Interval shall have priority over any Charging Notices and Discharging Notices applicable to such Settlement Interval, and Seller shall have no liability for violation of this Section 4.5 or any Charging Notice or Discharging Notice if and to the extent such violation is caused by Seller’s compliance with any Curtailment Order, Buyer Curtailment Order, Buyer Bid Curtailment or other instruction or direction from a Governmental Authority or the PTO or the Transmission Provider. Buyer shall have the right, but not the obligation, to provide Seller with updated Charging Notices and Discharging Notices during any Buyer Curtailment Order, Buyer Bid Curtailment or Curtailment Order consistent with the Operational Procedures.

4.6 Reduction in Delivery Obligation. For the avoidance of doubt, and in no way limiting Section 3.1 or Exhibit G:
(a) Facility Maintenance. Subject to providing Buyer one-hundred twenty (120) days’ prior Notice, Seller shall be permitted to reduce deliveries of Product during any period of scheduled maintenance on the Facility, provided, that (i) no notice is required for scheduled maintenance or any changes or extensions thereto which do not result in a shutdown of more than of the Installed PV Capacity and of the Installed Battery Capacity, and (ii) Seller may adjust the dates of any scheduled maintenance with fewer than one hundred and twenty (120) days’ prior Notice to Buyer so long as (X) Seller makes its request more than three (3) days prior to the expected start date of such scheduled maintenance and (Y) the requested alternate date is acceptable to Buyer. To the extent notice is not already required under the terms hereof, Seller shall notify Buyer as soon as practicable of any extensions to scheduled maintenance and expected end dates thereof. Between June 1st and September 30th, Seller shall not schedule non-emergency maintenance that reduces the Energy generation of the Facility by more than unless (i) such outage is required to avoid damage to the Facility, (ii) such maintenance is necessary to maintain equipment warranties and cannot be scheduled outside the period of June 1st to September 30th, (iii) such outage is required in accordance with Prudent Operating Practices, or (iv) the Parties agree otherwise in writing (each scheduled maintenance permitted under this clause (a) and each of the foregoing outages described in foregoing clauses (a)(i) – (a)(iv), a “Planned Outage”). (b) Forced Facility Outage. Seller shall be permitted to reduce deliveries of Product during any Forced Facility Outage. Seller shall provide Buyer with Notice and expected duration (if known) of any Forced Facility Outage.
(c) System Emergencies and other Interconnection Events. Seller shall be permitted to reduce deliveries of Product during any period of System Emergency, Buyer Curtailment Period or upon Notice of a Curtailment Order pursuant to the terms of this Agreement, the Interconnection Agreement or applicable tariff.
(d) Force Majeure Event. Seller shall be permitted to reduce deliveries of Product during any Force Majeure Event.
(e) Health and Safety. Seller shall be permitted to reduce deliveries of Product as necessary to maintain health and safety pursuant to Section 6.2.

4.7 Guaranteed Energy Production. Seller shall be required to deliver to Buyer no Attachment Staff Report Item 15C
34 less than the Guaranteed Energy Production in each Performance Measurement Period. Seller shall be excused from achieving the Guaranteed Energy Production during any Performance Measurement Period only to the extent of any Force Majeure Events, System Emergency, Storage Capacity Tests, Buyer’s Default or other failure to perform, and Curtailment Periods or Buyer Curtailment Periods. For purposes of determining whether Seller has achieved the Guaranteed Energy Production, Seller shall be deemed to have delivered to Buyer (1) any Deemed Delivered Energy and (2) Energy in the amount it could reasonably have delivered to Buyer but was prevented from delivering to Buyer by reason of any Force Majeure Events, System Emergency, Storage Capacity Tests, Buyer’s Default or other failure to perform, and Curtailment Periods (“Lost Output”). If Seller fails to achieve the Guaranteed Energy Production amount in any Performance Measurement Period, Seller shall pay Buyer damages calculated in accordance with Exhibit G.

4.8 Storage Availability.
(a) During the Delivery Term, the Storage Facility shall maintain a Monthly Storage Availability during each month of no less than (the “Guaranteed Storage Availability”), which Monthly Storage Availability shall be calculated in accordance with Exhibit P.
(b) If, the Monthly Storage Availability during any month is less than the Guaranteed Storage Availability, then Buyer’s payment for the Storage Product shall be calculated by reference to the Availability Adjusted Storage Contract Capacity (as determined in accordance with Exhibit P).

4.9 Storage Capacity Tests.
(a) Prior to the Commercial Operation Date, Seller shall schedule and complete a Storage Capacity Test in accordance with Exhibit O. Thereafter, Seller and Buyer shall have the right to run additional Storage Capacity Tests in accordance with Exhibit O. (b) Buyer shall have the right to send one or more representative(s) to witness all Storage Capacity Tests. Buyer shall be responsible for all costs, expenses and fees payable or reimbursable to its representative(s) witnessing any Storage Capacity Test. Except as otherwise specified in Exhibit O, all other costs or revenues associated with any Storage Capacity Test shall be borne by, or accrue to, Seller, as applicable.
(c) Following each Storage Capacity Test, Seller shall submit a testing report in accordance with Exhibit O. If the actual capacity determined pursuant to a Storage Capacity Test is less than the then current Storage Contract Capacity, then the actual capacity determined pursuant to a Storage Capacity Test shall become the new Storage Contract Capacity at the beginning of the day following the completion of the test for all purposes under this Agreement, including compensation under Exhibit C.

4.10 WREGIS. Seller shall, at its sole expense, but subject to Section 3.12, take all actions and execute all documents or instruments necessary to ensure that all WREGIS Certificates associated with all Renewable Energy Credits corresponding to all Facility Energy are issued and tracked for purposes of satisfying the requirements of the California Renewables Portfolio Attachment Staff Report Item 15C
35 Standard and transferred in a timely manner to Buyer for Buyer’s sole benefit. Seller shall transfer the Renewable Energy Credits to Buyer. Seller shall comply with all Laws, including the WREGIS Operating Rules, regarding the certification and transfer of such WREGIS Certificates to Buyer and Buyer shall be given sole title to all such WREGIS Certificates. Seller shall be deemed to have satisfied the warranty in Section 4.10(g), provided that Seller fulfills its obligations under Sections

4.10(a) through (g) below. In addition:
(a) Prior to the Commercial Operation Date, Seller shall register the Facility with WREGIS and establish an account with WREGIS (“Seller’s WREGIS Account”), which Seller shall maintain until the end of the Delivery Term. Seller shall transfer the WREGIS Certificates using “Forward Certificate Transfers” (as described in the WREGIS Operating Rules) from Seller’s WREGIS Account to the WREGIS account(s) of Buyer or the account(s) of a designee that Buyer identifies by Notice to Seller (“Buyer’s WREGIS Account”). Seller shall be responsible for all expenses associated with registering the Facility with WREGIS, establishing and maintaining Seller’s WREGIS Account, paying WREGIS Certificate issuance and transfer fees, and transferring WREGIS Certificates from Seller’s WREGIS Account to Buyer’s WREGIS Account.
(b) Seller shall cause Forward Certificate Transfers to occur on a monthly basis in accordance with the certification procedure established by the WREGIS Operating Rules. Since WREGIS Certificates will only be created for whole MWh amounts of Facility Energy generated, any fractional MWh amounts (i.e., kWh) will be carried forward until sufficient generation is accumulated for the creation of a WREGIS Certificate.
(c) Seller shall, at its sole expense, ensure that the WREGIS Certificates for a given calendar month correspond with the Facility Energy for such calendar month as evidenced by the Facility’s metered data.
(d) Due to the ninety (90) day delay in the creation of WREGIS Certificates relative to the timing of invoice payment under Section 8.2, Buyer shall make an invoice payment for a given month in accordance with Section 8.2 before the WREGIS Certificates for such month are formally transferred to Buyer in accordance with the WREGIS Operating Rules and this Section 4.10. Notwithstanding this delay, Buyer shall have all right and title to all such WREGIS Certificates upon payment to Seller in accordance with Section 8.2. (e) A “WREGIS Certificate Deficit” means any deficit or shortfall in WREGIS Certificates delivered to Buyer for a calendar month as compared to the Facility Energy for the same calendar month (“Deficient Month”) caused by an error or omission of Seller. If any WREGIS Certificate Deficit is caused, or the result of any action or inaction by Seller, then the amount of Adjusted Facility Energy in the Deficient Month shall be reduced by the amount of the WREGIS Certificate Deficit for purposes of calculating Buyer’s payment to Seller under Article 8 and the Guaranteed Energy Production for the applicable Contract Year; provided, however, that such adjustment shall not apply to the extent that Seller either (x) resolves the WREGIS Certificate Deficit within ninety (90) days after the Deficient Month or (y) provides Replacement Green Attributes (as defined in Exhibit G) delivered to NP 15 EZ Gen Hub as Scheduled Energy within ninety (90) days after the Deficient Month (i) upon a schedule reasonably acceptable to Buyer and (ii) provided that such deliveries do not impose additional costs upon Buyer for which Seller Attachment Staff Report Item 15C
36 refuses to provide reimbursement. Without limiting Seller’s obligations under this Section 4.10, if a WREGIS Certificate Deficit is caused solely by an error or omission of WREGIS, the Parties shall cooperate in good faith to cause WREGIS to correct its error or omission. (f) If (i) WREGIS changes the WREGIS Operating Rules after the Effective Date or applies the WREGIS Operating Rules in a manner inconsistent with this Section 4.10 after the Effective Date, or (ii) the Parties enable the Storage Facility to be charged from the grid in accordance with Section 3.1.3, the Parties promptly shall modify this Section 4.10 as reasonably required to cause and enable Seller to transfer to Buyer’s WREGIS Account a quantity of WREGIS Certificates for each given calendar month that corresponds to the Facility Energy in the same calendar month.
(g) Seller warrants that all necessary steps to allow the Renewable Energy Credits transferred to Buyer to be tracked in WREGIS will be taken prior to the first delivery under this Agreement.

4.11 Green-E Certification. Seller shall, at its sole expense, take all actions and execute all documents or instruments necessary to ensure that the Facility is Green-E eligible.

ARTICLE 5
TAXES

5.1 Allocation of Taxes and Charges. Seller shall pay or cause to be paid all Taxes on or with respect to the Facility or on or with respect to the sale and making available of Product to Buyer, that are imposed on Product prior to its delivery to Buyer at the time and place contemplated under this Agreement. Buyer shall pay or cause to be paid all Taxes on or with respect to the delivery to and purchase by Buyer of Product that are imposed on Product at and after its delivery to Buyer at the time and place contemplated under this Agreement (other than withholding or other Taxes imposed on Seller’s income, revenue, receipts or employees), if any.

If a Party is required to remit or pay Taxes that are the other Party’s responsibility hereunder, such Party shall promptly pay the Taxes due and then seek and receive reimbursement from the other for such Taxes. In the event any sale of Product hereunder is exempt from or not subject to any particular Tax, Buyer shall provide Seller with all necessary documentation within thirty (30) days after the Effective Date to evidence such exemption or exclusion. If Buyer does not provide such documentation, then Buyer shall indemnify, defend, and hold Seller harmless from any liability with respect to Taxes from which Buyer claims it is exempt.

5.2 Cooperation. Each Party shall use reasonable efforts to implement the provisions of and administer this Agreement in accordance with the intent of the Parties to minimize all Taxes, so long as no Party is materially adversely affected by such efforts. The Parties shall cooperate to minimize Tax exposure; provided, however, that neither Party shall be obligated to incur any financial or operational burden to reduce Taxes for which the other Party is responsible hereunder without receiving due compensation therefor from the other Party. All Product delivered by Seller to Buyer hereunder shall be a sale made at wholesale, with Buyer reselling such Product.

Attachment Staff Report Item 15C
37 ARTICLE 6

MAINTENANCE OF THE FACILITY

6.1 Maintenance of the Facility. Seller shall comply with Law and Prudent Operating Practice relating to the operation and maintenance of the Facility and the generation and sale of Product.

6.2 Maintenance of Health and Safety. Seller shall take reasonable safety precautions with respect to the operation, maintenance, repair and replacement of the Facility. If Seller becomes aware of any circumstances relating to the Facility that create an imminent risk of damage or injury to any Person or any Person’s property, Seller shall take prompt, reasonable action to prevent such damage or injury and shall give Notice to Buyer’s emergency contact identified on Exhibit N of such condition. Such action may include, to the extent reasonably necessary, disconnecting and removing all or a portion of the Facility, or suspending the supply of Energy or Discharging Energy to Buyer.

6.3 Shared Facilities. The Parties acknowledge and agree that certain of the Shared Facilities and Interconnection Facilities, and Seller’s rights and obligations under the Interconnection Agreement, may be subject to certain shared facilities or co-tenancy agreements to be entered into among Seller, the Participating Transmission Owner, Seller’s Affiliates, or third parties pursuant to which certain Interconnection Facilities may be subject to joint ownership and shared maintenance and operation arrangements; provided that such agreements (i) shall permit Seller to perform or satisfy, and shall not purport to limit, its obligations hereunder and (ii) provide for separate metering of the Facility.

ARTICLE 7

METERING

7.1 Metering. Seller shall measure the amount of Facility Energy using the Facility Meter, which will be subject to adjustment in accordance with applicable CAISO meter requirements and Prudent Operating Practices, including to account for Electrical Losses and Station Use. Seller shall measure the Charging Energy and the Discharging Energy using the Storage Facility Meters. All meters will be operated pursuant to applicable CAISO-approved calculation methodologies and maintained as Seller’s cost. Subject to meeting any applicable CAISO requirements, the meters shall be programmed to adjust for all losses from such meter to the Delivery Point in a manner subject to Buyer’s prior written approval, not to be unreasonably withheld. Metering will be consistent with the Metering Diagram set forth as Exhibit R. Each meter shall be kept under seal, such seals to be broken only when the meters are to be tested, adjusted, modified or relocated. In the event Seller breaks a seal, Seller shall notify Buyer as soon as practicable. In addition, Seller hereby agrees to provide all meter data to Buyer in a form reasonably acceptable to Buyer, and consents to Buyer obtaining from CAISO the CAISO meter data directly relating to the Facility and all inspection, testing and calibration data and reports.

Seller and Buyer, or Buyer’s Scheduling Coordinator, shall cooperate to allow both Parties to retrieve the meter reads from the CAISO Operational Meter Analysis and Reporting (OMAR) web or directly from the CAISO meter(s) at the Facility.

Attachment Staff Report Item 15C
Attachment Staff Report Item 15C
Attachment Staff Report Item 15C
Attachment Staff Report Item 15C
Attachment Staff Report Item 15C
42 ARTICLE 10

FORCE MAJEURE

10.1 Definition.
(a) “Force Majeure Event” means any act or event that delays or prevents a Party from timely performing all or a portion of its obligations under this Agreement or from complying with all or a portion of the conditions under this Agreement if such act or event, despite the exercise of reasonable efforts, cannot be avoided by and is beyond the reasonable control (whether direct or indirect) of and without the fault or negligence of the Party relying thereon as justification for such delay, nonperformance, or noncompliance. (b) Without limiting the generality of the foregoing, so long as the following events, despite the exercise of reasonable efforts, cannot be avoided by, and are beyond the reasonable control (whether direct or indirect) of and without the fault or negligence of the Party relying thereon as justification for such delay, nonperformance or noncompliance, a Force Majeure Event may include an act of God or the elements, such as flooding, lightning, hurricanes, tornadoes, or ice storms; explosion; fire; volcanic eruption; flood; epidemic; landslide; mudslide; sabotage; terrorism; earthquake; or other cataclysmic events; an act of public enemy; war; blockade; civil insurrection; riot; civil disturbance; or strikes or other labor difficulties caused or suffered by a Party or any third party except as set forth below. (c) Notwithstanding the foregoing, the term “Force Majeure Event” does not include (i) economic conditions that render a Party’s performance of this Agreement at the Contract Price unprofitable or otherwise uneconomic (including an increase in component costs for any reason, including foreign or domestic tariffs, Buyer’s ability to buy electric energy at a lower price, or Seller’s ability to sell the Product, or any component thereof, at a higher price, than under this Agreement); (ii) Seller’s inability to obtain permits or approvals of any type for the construction, operation, or maintenance of the Facility, except to the extent such inability is caused by a Force Majeure Event; (iii) the inability of a Party to make payments when due under this Agreement, unless the cause of such inability is an event that would otherwise constitute a Force Majeure Event as described above; (iv) a Curtailment Order; (v) Seller’s inability to obtain sufficient labor, equipment, materials, or other resources to build or operate the Facility except to the extent such inability is caused by a Force Majeure Event; (vi) any equipment failure except if such equipment failure is caused by a Force Majeure Event; or (vii) Seller’s inability to achieve Construction Start of the Facility following the Guaranteed Construction Start Date or achieve Commercial Operation following the Guaranteed Commercial Operation Date unless the cause of such inability is an event that would otherwise constitute a Force Majeure Event as described above; it being understood and agreed, for the avoidance of doubt, that the occurrence of a Force Majeure Event may give rise to a Development Cure Period.

10.2 No Liability If a Force Majeure Event Occurs. Neither Seller nor Buyer shall be liable to the other Party in the event it is prevented from performing its obligations hereunder in whole or in part due to a Force Majeure Event. The Party rendered unable to fulfill any obligation by reason of a Force Majeure Event shall take reasonable actions necessary to remove such inability. Nothing herein shall be construed as permitting that Party to continue to fail to perform after said cause has been removed. Neither Party shall be considered in breach or default Attachment Staff Report Item 15C
43 of this Agreement if and to the extent that any failure or delay in the Party’s performance of one or more of its obligations hereunder is caused by a Force Majeure Event. The occurrence and continuation of a Force Majeure Event shall not suspend or excuse the obligation of a Party to make any payments due hereunder.

10.3 Notice. In the event of any delay or nonperformance resulting from a Force Majeure Event, the Party suffering the Force Majeure Event shall (a) as soon as practicable, notify the other Party in writing of the nature, cause, estimated date of commencement thereof, and the anticipated extent of any delay or interruption in performance, and (b) notify the other Party in writing of the cessation or termination of such Force Majeure Event, all as known or estimated in good faith by the affected Party; provided, however, that a Party’s failure to give timely Notice shall not affect such Party’s ability to assert that a Force Majeure Event has occurred unless the delay in giving Notice materially prejudices the other Party.

10.4 Termination Following Force Majeure Event. If a Force Majeure Event has occurred that has caused either Party to be wholly or partially unable to perform its obligations hereunder, and the impacted Party has claimed and received relief from performance of its obligations for a consecutive twelve (12) month period, then the non-claiming Party may terminate this Agreement upon written Notice to the other Party with respect to the Facility experiencing the Force Majeure Event; provided, however, that, in the case of Seller as the impacted Party with respect to a Force Majeure Event occurring after the Commercial Operation Date, Seller shall be entitled to six (6) additional months to remedy the Force Majeure Event before Buyer may terminate this Agreement if (a) Seller has been unable to remedy the Force Majeure Event within the original twelve (12) month period despite exercising diligent efforts and (b) Seller provides to Buyer prior to the expiration of the original twelve (12) month period (i) a detailed plan reasonably acceptable to an independent, professional engineer selected by Buyer, licensed in the State of California, that explains how Seller will restore the Facility, and (ii) evidence to Buyer’s reasonable satisfaction that Seller was unable to restore the Facility to operational status within the original twelve (12) month period despite the exercise of diligent efforts but the Facility is reasonably likely to be restored to operational status within the additional six (6) month period by Seller’s execution of the plan described above. Upon any such termination, neither Party shall have any liability to the other Party, save and except for those obligations specified in Section 2.1(b), and Buyer shall promptly return to Seller any Development Security or Performance Security then held by Buyer, less any amounts drawn in accordance with this Agreement.

ARTICLE 11
DEFAULTS; REMEDIES; TERMINATION

11.1 Events of Default. An “Event of Default” shall mean, (a) with respect to a Party (the “Defaulting Party”) that is subject to the Event of Default the occurrence of any of the following:
(i) the failure by such Party to make, when due, any payment required pursuant to this Agreement and such failure is not remedied within ten (10) Business Days after Notice thereof;
Attachment Staff Report Item 15C
Attachment Staff Report Item 15C
Attachment Staff Report Item 15C
46 failure by Seller to provide for the benefit of Buyer either (1) cash, or (2) a substitute Letter of Credit from a different issuer meeting the criteria set forth in the definition of Letter of Credit, in each case, in the amount required hereunder within ten (10) Business Days after Seller receives Notice of the occurrence of any of the following events:
(A) the issuer of the outstanding Letter of Credit shall fail to maintain a Credit Rating of at least by S&P or by Moody’s; (B) the issuer of such Letter of Credit becomes Bankrupt; (C) the issuer of the outstanding Letter of Credit shall fail to comply with or perform its obligations under such Letter of Credit and such failure shall be continuing after the lapse of any applicable grace period permitted under such Letter of Credit;
(D) the issuer of the outstanding Letter of Credit shall fail to honor a properly documented request to draw on such Letter of Credit; (E) the issuer of the outstanding Letter of Credit shall disaffirm, disclaim, repudiate or reject, in whole or in part, or challenge the validity of, such Letter of Credit;
(F) such Letter of Credit fails or ceases to be in full force and effect at any time; or
(G) Seller shall fail to renew or cause the renewal of each outstanding Letter of Credit on a timely basis as provided in the relevant Letter of Credit and as provided in accordance with this Agreement, and in no event less than sixty (60) days prior to the expiration of the outstanding Letter of Credit.

11.2 Remedies; Declaration of Early Termination Date. If an Event of Default with respect to a Defaulting Party shall have occurred and be continuing, the other Party (“Non-Defaulting Party”) shall have the following rights:
(a) to send Notice, designating a day, no earlier than the day such Notice is deemed to be received and no later than twenty (20) days after such Notice is deemed to be received, as an early termination date of this Agreement (“Early Termination Date”) that terminates this Agreement (the “Terminated Transaction”) and ends the Delivery Term effective as of the Early Termination Date;
(b) to accelerate all amounts owing between the Parties, and to collect as liquidated damages (i) the Damage Payment (in the case of an Event of Default by Seller occurring before the Commercial Operation Date, including an Event of Default under Section 11.1(b)(ii)) subject to the limitations in Section 11.7, or (ii) the Termination Payment calculated in accordance with Section 11.3 below (in the case of any other Event of Default by either Party); (c) to withhold any payments due to the Defaulting Party under this Agreement; Attachment Staff Report Item 15C
47 (d) to suspend performance; or
(e) to exercise any other right or remedy available at law or in equity, including specific performance or injunctive relief, except to the extent such remedies are expressly limited under this Agreement;
provided, that payment by the Defaulting Party of the Damage Payment or Termination Payment, as applicable, shall constitute liquidated damages and the Non-Defaulting Party’s sole and exclusive remedy for the Terminated Transaction and the Event of Default related thereto.

11.3 Termination Payment. The Termination Payment (“Termination Payment”) for the Terminated Transaction shall be the aggregate of all Settlement Amounts plus any or all other amounts due to or from the Non-Defaulting Party (as of the Early Termination Date) netted into a single amount. The Non-Defaulting Party shall calculate, in a commercially reasonable manner, a Settlement Amount for the Terminated Transaction as of the Early Termination Date. Third parties supplying information for purposes of the calculation of Gains or Losses may include, without limitation, dealers in the relevant markets, end-users of the relevant product, information vendors and other sources of market information. The Settlement Amount shall not include consequential, incidental, punitive, exemplary, indirect or business interruption damages. Without prejudice to the Non-Defaulting Party’s duty to mitigate, the Non-Defaulting Party shall not have to enter into replacement transactions to establish a Settlement Amount. Each Party agrees and acknowledges that (a) the actual damages that the Non-Defaulting Party would incur in connection with the Terminated Transaction would be difficult or impossible to predict with certainty, (b) the Damage Payment or Termination Payment described in Section 11.2 or this Section 11.3 (as applicable) is a reasonable and appropriate approximation of such damages, and (c) the Damage Payment or Termination Payment described in Section 11.2 or this Section 11.3 (as applicable) is the exclusive remedy of the Non-Defaulting Party in connection with the Terminated Transaction but shall not otherwise act to limit any of the Non-Defaulting Party’s rights or remedies if the Non-Defaulting Party does not elect a Terminated Transaction as its remedy for an Event of Default by the Defaulting Party.

11.4 Notice of Payment of Termination Payment. As soon as practicable after a Terminated Transaction, Notice shall be given by the Non-Defaulting Party to the Defaulting Party of the amount of the Damage Payment or Termination Payment and whether the Termination Payment is due to or from the Non-Defaulting Party. The Notice shall include a written statement explaining in reasonable detail the calculation of such amount and the sources for such calculation.

The Termination Payment shall be made to or from the Non-Defaulting Party, as applicable, within ten (10) Business Days after such Notice is effective.

11.5 Disputes With Respect to Termination Payment. If the Defaulting Party disputes the Non-Defaulting Party’s calculation of the Termination Payment, in whole or in part, the Defaulting Party shall, within five (5) Business Days of receipt of the Non-Defaulting Party’s calculation of the Termination Payment, provide to the Non-Defaulting Party a detailed written explanation of the basis for such dispute. Disputes regarding the Termination Payment shall be determined in accordance with Article 15.

Attachment Staff Report Item 15C
Attachment Staff Report Item 15C
49 TO THE EXTENT ANY DAMAGES REQUIRED TO BE PAID HEREUNDER ARE LIQUIDATED, INCLUDING UNDER SECTIONS 3.8, 4.7, 4.8, 11.2 AND 11.3, AND AS

PROVIDED IN EXHIBIT B, EXHIBIT G, AND EXHIBIT P THE PARTIES ACKNOWLEDGE

THAT THE DAMAGES ARE DIFFICULT OR IMPOSSIBLE TO DETERMINE, THAT

OTHERWISE OBTAINING AN ADEQUATE REMEDY IS INCONVENIENT, AND THAT

THE LIQUIDATED DAMAGES CONSTITUTE A REASONABLE APPROXIMATION OF THE ANTICIPATED HARM OR LOSS. IT IS THE INTENT OF THE PARTIES THAT THE

LIMITATIONS HEREIN IMPOSED ON REMEDIES AND THE MEASURE OF DAMAGES

BE WITHOUT REGARD TO THE CAUSE OR CAUSES RELATED THERETO, INCLUDING

THE NEGLIGENCE OF ANY PARTY, WHETHER SUCH NEGLIGENCE BE SOLE, JOINT OR CONCURRENT, OR ACTIVE OR PASSIVE. THE PARTIES HEREBY WAIVE ANY RIGHT TO CONTEST SUCH PAYMENTS AS AN UNREASONABLE PENALTY.

THE PARTIES ACKNOWLEDGE AND AGREE THAT MONEY DAMAGES AND THE

EXPRESS REMEDIES PROVIDED FOR HEREIN ARE AN ADEQUATE REMEDY FOR THE

BREACH BY THE OTHER OF THE TERMS OF THIS AGREEMENT, AND EACH PARTY

WAIVES ANY RIGHT IT MAY HAVE TO SPECIFIC PERFORMANCE WITH RESPECT TO ANY OBLIGATION OF THE OTHER PARTY UNDER THIS AGREEMENT.

ARTICLE 13
REPRESENTATIONS AND WARRANTIES; AUTHORITY

13.1 Seller’s Representations and Warranties. As of the Effective Date, Seller represents and warrants as follows:
(a) Seller is a limited liability company, duly organized, validly existing and in good standing under the laws of the jurisdiction of its formation, and is qualified to conduct business in the state of California and each jurisdiction where the failure to so qualify would have a material adverse effect on the business or financial condition of Seller. (b) Seller has the power and authority to enter into and perform this Agreement and is not prohibited from entering into this Agreement or discharging and performing all covenants and obligations on its part to be performed under and pursuant to this Agreement, except where such failure does not have a material adverse effect on Seller’s performance under this Agreement. The execution, delivery and performance of this Agreement by Seller has been duly authorized by all necessary limited liability company action on the part of Seller and does not and will not require the consent of any trustee or holder of any indebtedness or other obligation of Seller or any other party to any other agreement with Seller. (c) The execution and delivery of this Agreement, consummation of the transactions contemplated herein, and fulfillment of and compliance by Seller with the provisions of this Agreement will not conflict with or constitute a breach of or a default under any Law presently in effect having applicability to Seller, subject to any permits that have not yet been obtained by Seller, the documents of formation of Seller or any outstanding trust indenture, deed of trust, mortgage, loan agreement or other evidence of indebtedness or any other agreement or instrument to which Seller is a party or by which any of its property is bound.

Attachment Staff Report Item 15C
50 (d) This Agreement has been duly executed and delivered by Seller. This Agreement is a legal, valid and binding obligation of Seller enforceable in accordance with its terms, except as limited by laws of general applicability limiting the enforcement of creditors’ rights or by the exercise of judicial discretion in accordance with general principles of equity. (e) The Facility is located in the State of California. (f) As between Buyer and Seller, Seller will be responsible for obtaining all permits necessary to construct and operate the Facility and Seller, or an Affiliate on behalf of Seller if permitted under CEQA, will be the applicant on any CEQA documents.

13.2 Buyer’s Representations and Warranties. As of the Effective Date, Buyer represents and warrants as follows:
(a) Buyer is a joint powers authority and a validly existing community choice aggregator, duly organized, validly existing and in good standing under the laws of the State of California and the rules, regulations and orders of the California Public Utilities Commission, and is qualified to conduct business in each jurisdiction of the Joint Powers Agreement members. All Persons making up the governing body of Buyer are the elected or appointed incumbents in their positions and hold their positions in good standing in accordance with the Joint Powers Agreement and other Law.
(b) Buyer has the power and authority to enter into and perform this Agreement and is not prohibited from entering into this Agreement or discharging and performing all covenants and obligations on its part to be performed under and pursuant to this Agreement, except where such failure does not have a material adverse effect on Buyer’s performance under this Agreement. The execution, delivery and performance of this Agreement by Buyer has been duly authorized by all necessary action on the part of Buyer and does not and will not require the consent of any trustee or holder of any indebtedness or other obligation of Buyer or any other party to any other agreement with Buyer.
(c) The execution and delivery of this Agreement, consummation of the transactions contemplated herein, and fulfillment of and compliance by Buyer with the provisions of this Agreement will not conflict with or constitute a breach of or a default under any Law presently in effect having applicability to Buyer, the documents of formation of Buyer or any outstanding trust indenture, deed of trust, mortgage, loan agreement or other evidence of indebtedness or any other agreement or instrument to which Buyer is a party or by which any of its property is bound.
(d) This Agreement has been duly executed and delivered by Buyer. This Agreement is a legal, valid and binding obligation of Buyer enforceable in accordance with its terms, except as limited by laws of general applicability limiting the enforcement of creditors’ rights or by the exercise of judicial discretion in accordance with general principles of equity. (e) Buyer warrants and covenants that with respect to its contractual obligations under this Agreement, it will not claim immunity on the grounds of sovereignty or similar grounds with respect to itself or its revenues or assets from (1) suit, (2) jurisdiction of court, (3) relief by way of injunction, order for specific performance or recovery of property, (4) attachment of assets, Attachment Staff Report Item 15C
51 or (5) execution or enforcement of any judgment; provided, however that nothing in this Agreement shall waive the obligations or rights set forth in the California Tort Claims Act (Government Code Section 810 et seq.)
(f) Buyer is a “local public entity” as defined in Section 900.4 of the Government Code of the State of California.

13.3 General Covenants. Each Party covenants that commencing on the Effective Date and continuing throughout the Contract Term:
(a) It shall continue to be duly organized, validly existing and in good standing under the laws of the jurisdiction of its formation and to be qualified to conduct business in California and each jurisdiction where the failure to so qualify would have a material adverse effect on its business or financial condition;
(b) It shall maintain (or obtain from time to time as required) all regulatory authorizations necessary for it to legally perform its obligations under this Agreement; and (c) It shall perform its obligations under this Agreement in compliance with all terms and conditions in its governing documents and in material compliance with any Law.

13.4 Prevailing Wage. Seller shall use reasonable efforts to ensure that all employees hired by Seller, and its contractors and subcontractors, that will perform construction work or provide services at the Site related to construction of the Facility are paid wages at rates not less than those prevailing for workers performing similar work in the locality as provided by applicable California law, if any (“Prevailing Wage Requirement”). Nothing herein shall require Seller, its contractors and subcontractors to comply with, or assume liability created by other inapplicable provisions of any California labor laws. Buyer agrees that Seller’s obligations under this Section

13.4 will be satisfied upon the execution of a project labor agreement related to construction of the Facility.

13.5 Workforce Development. Seller shall perform obligations related to workforce development and community investment to be mutually agreed between the Parties following the Effective Date. Seller agrees to contribute no less than (“Workforce Development and Community Investment Funds”) for such workforce development and community investment activities, subject to mutual agreement by the Parties. Seller will not be required to contribute or invest any Workforce Development and Community Investment Funds if such contribution or investment adversely affects the Seller or the development or financing of the Facility, or conflicts with or violates Law, Prudent Operating Practice, or the business practices, bylaws, charter documents or other agreements of Buyer or Seller.

13.6 Union Labor. Seller will cause the contractor under its primary EPC, BOP or construction contract for the Project to enter into a five-party project labor agreement, or other agreement reasonably acceptable to both Parties, at a time of Seller’s choosing consistent with Seller’s construction schedule for the Facility.

Attachment Staff Report Item 15C
52 ARTICLE 14

ASSIGNMENT

14.1 General Prohibition on Assignments. Neither Party may voluntarily assign this Agreement or its rights or obligations under this Agreement, without the prior written consent of the other Party, which consent shall not be unreasonably withheld. Any Change of Control of Seller or direct or indirect change of control of Buyer (whether voluntary or by operation of law) will be deemed an assignment and will require the prior written consent of the other Party, which consent shall not be unreasonably withheld Any assignment made without required written consent, or in violation of the conditions to assignment set out below, shall be null and void. Seller shall be responsible for Buyer’s reasonable costs associated with the preparation, review, execution and delivery of documents in connection with any assignment of this Agreement, including without limitation reasonable attorneys’ fees.

14.2 Collateral Assignment. Subject to the provisions of this Section 14.2, Seller has the right to assign this Agreement as collateral for any financing or refinancing of the Facility.

In connection with any financing or refinancing of the Facility by Seller, Buyer shall in good faith work with Seller and Lender to agree upon a consent to collateral assignment of this Agreement (“Collateral Assignment Agreement”). The Collateral Assignment Agreement must be in form and substance agreed to by Buyer, Seller and Lender, with such agreement not to be unreasonably withheld, and must include, among others, the following provisions:
(a) Buyer shall give Notice of an Event of Default by Seller to the Person(s) to be specified by Lender in the Collateral Assignment Agreement, before exercising its right to terminate this Agreement as a result of such Event of Default; provided that such notice shall be provided to Lender at the time such notice is provided to Seller and any additional cure period of Lender agreed to in the Collateral Assignment Agreement shall not commence until Lender has received notice of such Event of Default;
(b) Following an Event of Default by Seller under this Agreement, Buyer may require Seller or Lender to provide to Buyer a report concerning:
(i) The status of efforts by Seller or Lender to develop a plan to cure the Event of Default;
(ii) Impediments to the cure plan or its development;
(iii) If a cure plan has been adopted, the status of the cure plan’s implementation (including any modifications to the plan as well as the expected timeframe within which any cure is expected to be implemented); and
(iv) Any other information which Buyer may reasonably require related to the development, implementation and timetable of the cure plan.

Seller or Lender must provide the report to Buyer within ten (10) Business Days after Notice from Buyer requesting the report. Buyer will have no further right to require the report with respect to a particular Event of Default after that Event of Attachment Staff Report Item 15C
53 Default has been cured;
(c) Lender will have the right to cure an Event of Default on behalf of Seller, only if Lender sends a written notice to Buyer before the later of (i) the expiration of any cure period under this Agreement, and (ii) five (5) Business Days after Lender’s receipt of notice of such Event of Default from Buyer, indicating Lender’s intention to cure. Lender must remedy or cure the Event of Default within the cure period under this Agreement and any additional cure periods agreed in the Collateral Assignment Agreement up to a maximum of ninety (90) days (or one hundred eighty (180) days in the event of a bankruptcy of Seller or any foreclosure or similar proceeding if required by Lender to cure any Event of Default); (d) Lender will have the right to consent before any termination of this Agreement which does not arise out of an Event of Default; (e) Lender will receive prior Notice of and the right to approve material amendments to this Agreement, which approval will not be unreasonably withheld, delayed or conditioned;
(f) If Lender, directly or indirectly, takes possession of, or title to the Facility (including possession by a receiver or title by foreclosure or deed in lieu of foreclosure), Lender must assume all of Seller’s obligations arising under this Agreement and all related agreements (subject to such limits on liability as are mutually agreed to by Seller, Buyer and Lender as set forth in the Collateral Assignment Agreement); provided, before such assumption, if Buyer advises Lender that Buyer will require that Lender cure (or cause to be cured) any Event of Default existing as of the possession date in order to avoid the exercise by Buyer (in its sole discretion) of Buyer’s right to terminate this Agreement with respect to such Event of Default, then Lender at its option, and in its sole discretion, may elect to either:
(i) Cause such Event of Default to be cured, or
(ii) Not assume this Agreement;
(g) If Lender elects to sell or transfer the Facility (after Lender directly or indirectly, takes possession of, or title to the Facility), or sale of the Facility occurs through the actions of Lender (for example, a foreclosure sale where a third party is the buyer, or otherwise), then Lender must cause the transferee or buyer to assume all of Seller’s obligations arising under this Agreement and all related agreements as a condition of the sale or transfer. Such sale or transfer may be made only to an entity that (i) meets the definition of Permitted Transferee and (ii) is an entity that Buyer is permitted to contract with under applicable Law; and (h) Subject to Lender’s cure of any Events of Defaults under the Agreement in accordance with Section 14.2(f), if (i) this Agreement is rejected in Seller’s Bankruptcy or otherwise terminated in connection therewith Lender shall have the right to elect within forty-five (45) days after such rejection or termination, to enter into a replacement agreement with Buyer having substantially the same terms as this Agreement for the remaining term thereof, or (ii) if Lender or its designee, directly or indirectly, takes possession of, or title to, the Facility (including possession by a receiver or title by foreclosure or deed in lieu of foreclosure) after any such rejection or termination of this Agreement, promptly after Buyer’s written request, Lender must Attachment Staff Report Item 15C
54 itself or must cause its designee to promptly enter into a new agreement with Buyer having substantially the same terms as this Agreement for the remaining term thereof, provided that in the event a designee of Lender, directly or indirectly, takes possession of, or title to, the Facility (including possession by a receiver or title by foreclosure or deed in lieu of foreclosure), such designee shall be approved by Buyer, not to be unreasonably withheld.

14.3 Permitted Assignment by Seller. Except as may be precluded by, or would cause Buyer to be in violation of the Political Reform Act, (Cal. Gov. Code section 81000 et seq,) or the regulations thereto, Cal. Government Code section 1090, Buyer’s Conflict of Interest Code/Policy or any other conflict of interest Law, Seller may, without the prior written consent of Buyer, transfer or assign this Agreement, including through a Change of Control, to an Affiliate of Seller. In addition, Buyer’s written consent will not be unreasonably withheld for the transfer or assignment of this Agreement, including through a Change of Control, to any Person succeeding to all or substantially all of the assets of Seller (whether voluntary or by operation of law and whether by assignment or Change of Control), if, and only if:
(i) the assignee is a Permitted Transferee;
(ii) Seller has given Buyer Notice at least fifteen (15) Business Days before the date of such proposed assignment or Change of Control; and (iii) Seller has provided Buyer a written agreement signed by the Person to which Seller wishes to assign its interests that (x) provides that such Person will assume all of Seller’s obligations and liabilities under this Agreement upon such transfer or assignment and (y) certifies that such Person meets the definition of a Permitted Transferee Except as provided in the first sentence of this Section 14.3, any assignment or Change of Control by Seller, its successors or assigns under this Section 14.3 shall be of no force and effect unless and until such Notice and agreement by the assignee have been received and accepted by Buyer.

14.5 Shared Facilities; Portfolio Financing. Without limiting the foregoing, Buyer agrees and acknowledges that Seller may elect to finance all or any portion of the Facility or the Interconnection Facilities or the Shared Facilities (1) utilizing tax equity investment, or (2) through a Portfolio Financing, which may include cross-collateralization or similar arrangements. In connection with any financing or refinancing of the Facility, the Interconnection Facilities or the Shared Facilities by Seller or any Portfolio Financing, Buyer, Seller, Portfolio Financing Entity (if any), and Lender shall execute and deliver such further consents, approvals and acknowledgments as may be reasonable and necessary to facilitate such transactions provided, however, that Buyer shall not be required to agree to any terms or conditions which are reasonably expected to have a material adverse effect on Buyer and all reasonable attorney’s fees incurred by Buyer in connection therewith shall be borne by Seller.

ARTICLE 15

DISPUTE RESOLUTION

15.1 Governing Law. This Agreement and the rights and duties of the Parties hereunder shall be governed by and construed, enforced and performed in accordance with the laws of the state of California, without regard to principles of conflicts of Law. The Parties agree that any suit, Attachment Staff Report Item 15C
55 action or other legal proceeding by or against any party (or its affiliates or designees) with respect to or arising out of this Guaranty shall be brought in the federal courts of the United States or the courts of the State of California sitting in the County of Alameda, California.

15.2 Dispute Resolution. In the event of any dispute arising under this Agreement, within ten (10) days following the receipt of a written Notice from either Party identifying such dispute, the Parties shall meet, negotiate and attempt, in good faith, to resolve the dispute quickly, informally and inexpensively. If the Parties are unable to resolve a dispute arising hereunder within the earlier of either thirty (30) days of initiating such discussions, or within forty (40) days after Notice of the dispute, the parties shall submit the dispute to mediation prior to seeking any and all remediates available to it at Law in or equity. The Parties will cooperate in selecting a qualified neutral mediator selected from a panel of neutrals and in scheduling the time and place of the mediation as soon as reasonably possible, but in no event later than thirty (30) days after the request for mediation is made. The Parties agree to participate in the mediation in good faith and to share the costs of the mediation, including the mediator’s fee, equally, but such shared costs shall not include each Party’s own attorneys’ fees and costs, which shall be borne solely by such Party. If the mediation is unsuccessful, then either Party may seek any and all remedies available to it at law or in equity, subject to the limitations set forth in this Agreement.

ARTICLE 16

INDEMNIFICATION

16.1 Mutual Indemnity. Each Party (the “Indemnifying Party”) shall defend, indemnify and hold harmless the other Party (the “Indemnified Party”), its directors, officers, agents, attorneys, employees and representatives (collectively, the “Indemnified Group”) from and against all third party claims, demands, losses, liabilities, penalties, and expenses, including reasonable attorneys’ and expert witness fees, however described, which arise out of or relate to or are in any way connected with a violation of applicable Laws, negligent or tortious acts, errors, or omissions, or intentional acts or willful misconduct, in any of the foregoing cases, of the Indemnifying Party, its Affiliates, its or their directors, officers, employees, or agents, excepting only such losses, to the extent caused by the willful misconduct or gross negligence of a member of the Indemnified Group (collectively, “Indemnifiable Losses”).

16.2 Notice of Claim.
(a) Notice of Claim. Subject to the terms of this Agreement and upon obtaining knowledge of an Indemnifiable Loss for which it is entitled to indemnity under this Article 16, Buyer will promptly Notify Seller in writing of any damage, claim, loss, liability or expense which Buyer has determined has given or could give rise to an Indemnifiable Loss under Section 16.1 (“Claim”). The Notice is referred to as a “Notice of Claim”. A Notice of Claim will specify, in reasonable detail, the facts known to the Buyer regarding the Indemnifiable Loss. (b) Failure to Provide Notice. A failure to give timely Notice or to include any specified information in any Notice as provided in this Section 16.2 will not affect the rights or obligations of any Party hereunder except and only to the extent that, as a result of such failure, any Party which was entitled to receive such Notice was deprived of its right to recover any payment under its applicable insurance coverage or was otherwise materially damaged as a direct Attachment Staff Report Item 15C
56 result of such failure and, provided further, the Seller is not obligated to indemnify the Buyer for the increased amount of any Indemnifiable Loss which would otherwise have been payable to the extent that the increase resulted from the failure to deliver timely a Notice of Claim.

16.3 Defense of Claims. If, within ten (10) days after giving a Notice of Claim regarding a Claim to the Seller pursuant to Section 16.2(b), the Buyer receives Notice from such Seller that the Seller has elected to assume the defense of such Claim as provided in the last sentence of Section 16.2(b), the Seller will not be liable for any legal expenses subsequently incurred by the Buyer in connection with the defense thereof; provided, however, that if the Seller fails to take reasonable steps necessary to defend diligently such Claim within ten (10) days after receiving Notice from the Buyer that the Buyer believes the Seller has failed to take such steps, or if the Seller has not undertaken fully to indemnify the Buyer in respect of all Indemnifiable Losses relating to the matter, the Buyer may assume its own defense, and the Seller will be liable for all reasonable costs or expenses, including attorneys’ fees, paid or incurred in connection therewith.

Without the prior written consent of the Buyer, the Seller will not enter into any settlement of any Claim which would lead to liability or create any financial or other obligation on the part of the Buyer for which the Buyer is not entitled to indemnification hereunder; provided, however, that the Seller may accept any settlement without the consent of the Buyer if such settlement provides a full release to the Buyer and no requirement that the Buyer acknowledge fault or culpability. If a firm offer is made to settle a Claim without leading to liability or the creation of a financial or other obligation on the part of the Buyer for which the Buyer is not entitled to indemnification hereunder and the Seller desires to accept and agrees to such offer, the Seller will give Notice to the Buyer to that effect. If the Buyer fails to consent to such firm offer within ten (10) calendar days after its receipt of such Notice, the Buyer may continue to contest or defend such Claim and, in such event, the maximum liability of the Seller to such Claim will be the amount of such settlement offer, plus reasonable costs and expenses paid or incurred by the Buyer up to the date of such Notice.

16.4 Subrogation of Rights. Upon making any indemnity payment, the Seller will, to the extent of such indemnity payment, be subrogated to all rights of the Buyer against any Third Party in respect of the Indemnifiable Loss to which the indemnity payment relates; provided that (a) the Seller is in compliance with its obligations under this Agreement in respect of such Indemnifiable Loss, and (b) until the Buyer recovers full payment of its Indemnifiable Loss, any and all claims of the Seller against any such Third Party on account of said indemnity payment are hereby made expressly subordinated and subjected in right of payment to the Buyer’s rights against such Third Party. Without limiting the generality or effect of any other provision hereof, the Buyer and Seller shall execute upon request all instruments reasonably necessary to evidence and perfect the above-described subrogation and subordination rights.

16.5 Rights and Remedies are Cumulative. Except for express remedies already provided in this Agreement, the rights and remedies of a Party pursuant to this Article 16 are cumulative and in addition to the rights of the Parties otherwise provided in this Agreement.

Attachment Staff Report Item 15C
Attachment Staff Report Item 15C
58 damage. All subcontractors shall provide a primary endorsement and a waiver of subrogation to Seller for the required coverage pursuant to this Section 17.1(g). (h) Evidence of Insurance. Within ten (10) days after execution of the Agreement and upon annual renewal thereafter, Seller shall deliver to Buyer certificates of insurance evidencing such coverage. These certificates shall specify that Buyer shall be given at least thirty (30) days prior Notice by Seller in the event of any material modification, cancellation or termination of coverage. Such insurance shall be primary coverage without right of contribution from any insurance of Buyer. Any other insurance maintained by Seller is for the exclusive benefit of Seller and shall not in any manner inure to the benefit of Buyer.

ARTICLE 18

CONFIDENTIAL INFORMATION

18.1 Definition of Confidential Information. The following constitutes “Confidential Information,” whether oral or written which is delivered by Seller to Buyer or by Buyer to Seller including: (a) the terms and conditions of, and proposals and negotiations related to, this Agreement, and (b) information that either Seller or Buyer stamps or otherwise identifies as “confidential” or “proprietary” before disclosing it to the other. Confidential Information does not include (i) information that was publicly available at the time of the disclosure, other than as a result of a disclosure in breach of this Agreement; (ii) information that becomes publicly available through no fault of the recipient after the time of the delivery; (iii) information that was rightfully in the possession of the recipient (without confidential or proprietary restriction) at the time of delivery or that becomes available to the recipient from a source not subject to any restriction against disclosing such information to the recipient; and (iv) information that the recipient independently developed without a violation of this Agreement.

18.2 Duty to Maintain Confidentiality. Confidential Information will retain its character as Confidential Information but may be disclosed by the recipient (the “Receiving Party”) if and to the extent such disclosure is required (a) to be made by any requirements of Law, (b) pursuant to an order of a court or (c) in order to enforce this Agreement. If the Receiving Party becomes legally compelled (by interrogatories, requests for information or documents, subpoenas, summons, civil investigative demands, or similar processes or otherwise in connection with any litigation or to comply with any applicable law, order, regulation, ruling, regulatory request, accounting disclosure rule or standard or any exchange, control area or independent system operator rule) to disclose any Confidential Information of the disclosing Party (the “Disclosing Party”), Receiving Party shall provide Disclosing Party with prompt notice so that Disclosing Party, at its sole expense, may seek an appropriate protective order or other appropriate remedy.

If the Disclosing Party takes no such action after receiving the foregoing notice from the Receiving Party, the Receiving Party is not required to defend against such request and shall be permitted to disclose such Confidential Information of the Disclosing Party, with no liability for any damages that arise from such disclosure. Each Party hereto acknowledges and agrees that information and documentation provided in connection with this Agreement may be subject to the California Records Act (Government Code Section 6250 et seq.).

18.3 Irreparable Injury; Remedies. Receiving Party acknowledges that its obligations hereunder are necessary and reasonable in order to protect Disclosing Party and the business of Attachment Staff Report Item 15C
59 Disclosing Party, and expressly acknowledges that monetary damages would be inadequate to compensate Disclosing Party for any breach or threatened breach by Receiving Party of any covenants and agreements set forth herein. Accordingly, Receiving Party acknowledges that any such breach or threatened breach will cause irreparable injury to Disclosing Party and that, in addition to any other remedies that may be available, in law, in equity or otherwise, Disclosing Party will be entitled to obtain injunctive relief against the threatened breach of this Agreement or the continuation of any such breach, without the necessity of proving actual damages.

18.4 Disclosure to Lenders, Etc.. Notwithstanding anything to the contrary in this Article 18, Confidential Information may be disclosed by Seller to any actual or potential Lender or any of its Affiliates, and Seller’s actual or potential agents, consultants, contractors, or trustees, so long as the Person to whom Confidential Information is disclosed agrees in writing to be bound by the confidentiality provisions of this Article 18 to the same extent as if it were a Party.

18.5 Press Releases. Neither Party shall issue (or cause its Affiliates to issue) a press release regarding the transactions contemplated by this Agreement unless both Parties have agreed upon the contents of any such public statement.

ARTICLE 19

MISCELLANEOUS

19.1 Entire Agreement; Integration; Exhibits. This Agreement, together with the Cover Sheet and Exhibits attached hereto constitutes the entire agreement and understanding between Seller and Buyer with respect to the subject matter hereof and supersedes all prior agreements relating to the subject matter hereof, which are of no further force or effect. The Exhibits attached hereto are integral parts hereof and are made a part of this Agreement by reference. The headings used herein are for convenience and reference purposes only. In the event of a conflict between the provisions of this Agreement and those of the Cover Sheet or any Exhibit, the provisions of first the Cover Sheet, and then this Agreement shall prevail, and such Exhibit shall be corrected accordingly. This Agreement shall be considered for all purposes as prepared through the joint efforts of the Parties and shall not be construed against one Party or the other Party as a result of the preparation, substitution, submission or other event of negotiation, drafting or execution hereof.

19.2 Amendments. This Agreement may only be amended, modified or supplemented by an instrument in writing executed by duly authorized representatives of Seller and Buyer; provided, that, for the avoidance of doubt, this Agreement may not be amended by electronic mail communications.

19.3 No Waiver. Waiver by a Party of any default by the other Party shall not be construed as a waiver of any other default.

19.4 No Agency, Partnership, Joint Venture or Lease. Seller and the agents and employees of Seller shall, in the performance of this Agreement, act in an independent capacity and not as officers or employees or agents of Buyer. Under this Agreement, Seller and Buyer intend to act as energy seller and energy purchaser, respectively, and do not intend to be treated as, and shall not act as, partners in, co-venturers in or lessor/lessee with respect to the Facility or Attachment Staff Report Item 15C
60 any business related to the Facility. This Agreement shall not impart any rights enforceable by any third party (other than a permitted successor or assignee bound to this Agreement or, to the extent set forth herein, any Lender).

19.5 Severability. In the event that any provision of this Agreement is unenforceable or held to be unenforceable, the Parties agree that all other provisions of this Agreement have force and effect and shall not be affected thereby. The Parties shall, however, use their best endeavors to agree on the replacement of the void, illegal or unenforceable provision(s) with legally acceptable clauses which correspond as closely as possible to the sense and purpose of the affected provision and this Agreement as a whole.

19.6 Mobile-Sierra. Notwithstanding any other provision of this Agreement, neither Party shall seek, nor shall they support any third party seeking, to prospectively or retroactively revise the rates, terms or conditions of service of this Agreement through application or complaint to FERC pursuant to the provisions of Section 205, 206 or 306 of the Federal Power Act, or any other provisions of the Federal Power Act, absent prior written agreement of the Parties. Further, absent the prior written agreement in writing by both Parties, the standard of review for changes to the rates, terms or conditions of service of this Agreement proposed by a Party, a non-Party or FERC acting sua sponte shall be the “public interest” application of the “just and reasonable” standard of review set forth in United Gas Pipe Line Co. v. Mobile Gas Service Corp., 350 U.S. 332 (1956) and Federal Power Commission v. Sierra Pacific Power Co., 350 U.S. 348 (1956).

19.7 Counterparts; Electronic Signatures. This Agreement may be executed in one or more counterparts, all of which taken together shall constitute one and the same instrument and each of which shall be deemed an original. The Parties may rely on electronic, facsimile or scanned signatures as originals. Delivery of an executed signature page of this Agreement by electronic transmission (including facsimile and email transmission of a PDF image) shall be the same as delivery of an original executed signature page.

19.8 Facsimile or Electronic Delivery. This Agreement may be duly executed and delivered by a Party by execution and facsimile or electronic format (including portable document format (.pdf)) delivery of the signature page of a counterpart to the other Party, and, if delivery is made by facsimile or other electronic format, the executing Party shall promptly deliver, via overnight delivery, a complete original counterpart that it has executed to the other Party, but this Agreement shall be binding on and enforceable against the executing Party whether or not it delivers such original counterpart.

19.9 Binding Effect. This Agreement shall inure to the benefit of and be binding upon the Parties and their respective successors and permitted assigns.

19.10 No Recourse to Members of Buyer. Buyer is organized as a Joint Powers Authority in accordance with the Joint Exercise of Powers Act of the State of California (Government Code Section 6500, et seq.) pursuant to its Joint Powers Agreement and is a public entity separate from its constituent members. Buyer shall solely be responsible for all debts, obligations and liabilities accruing and arising out of this Agreement. Seller shall have no rights and shall not make any claims, take any actions or assert any remedies against any of Buyer’s Attachment Staff Report Item 15C
61 constituent members, or the employees, directors, officers, consultants or advisors or Buyer or its constituent members, in connection with this Agreement.

19.11 Forward Contract. The Parties acknowledge and agree that this Agreement constitutes a “forward contract” within the meaning of the U.S. Bankruptcy Code, and Buyer and Seller are “forward contract merchants” within the meaning of the U.S. Bankruptcy Code. Each Party further agrees that, for all purposes of this Agreement, each Party waives and agrees not to assert the applicability of the provisions of 11 U.S.C. § 366 in any bankruptcy proceeding wherein such Party is a debtor. In any such proceeding, each Party further waives the right to assert that the other Party is a provider of last resort to the extent such term relates to 11 U.S.C. §366 or another provision of 11 U.S.C. § 101-1532.

19.12 Further Assurances. Each of the Parties hereto agree to provide such information, execute and deliver any instruments and documents and to take such other actions as may be necessary or reasonably requested by the other Party which are not inconsistent with the provisions of this Agreement and which do not involve the assumptions of obligations other than those provided for in this Agreement, to give full effect to this Agreement and to carry out the intent of this Agreement.
[Signatures on following page]
Attachment Staff Report Item 15C
Attachment Staff Report Item 15C
Attachment Staff Report Item 15C

Exhibit B - 1

EXHIBIT B

MAJOR PROJECT DEVELOPMENT MILESTONES AND COMMERCIAL

OPERATION

1. Major Project Development Milestones.
(a) “Construction Start” will occur upon Seller’s execution of an engineering, procurement, and construction contract (or similar agreement) and issuance thereunder of a notice to proceed that authorizes the contractor to mobilize to Site and begin physical construction at the Site or [______]. The date of Construction Start will be evidenced by and subject to Seller’s delivery to Buyer of a certificate substantially in the form attached as Exhibit J hereto, and the date certified therein by Seller shall be the “Construction Start Date.” The Seller shall cause Construction Start to occur no later than the Guaranteed Construction Start Date. (b) “Major Project Development Milestone” means either the Guaranteed Construction Start Date or the Executed Interconnection Agreement Milestone. If Construction Start is not achieved by the Guaranteed Construction Start Date, or the Interconnection Agreement is not signed by Seller and the PTO on or before the Executed Interconnection Agreement Milestone, Seller shall pay Daily Delay Damages to Buyer for each day for which a Major Project Development Milestone has not been completed, subject to Section 11.7 of this Agreement and the other limitations set forth in this Exhibit B. Daily Delay Damages will be calculated separately and accrue independently for each Major Project Development Milestone. Daily Delay Damages shall be payable to Buyer by Seller until Seller completes both Major Project Development Milestone; provided that in no event shall Seller be obligated to pay aggregate Daily Delay Damages in excess of the Development Security amount required hereunder. On or before the day of each month, Buyer shall invoice Seller for Daily Delay Damages, if any, accrued during the prior month and, within following Seller’s receipt of such invoice, Seller shall pay Buyer the amount of the Daily Delay Damages set forth in such invoice. Daily Delay Damages shall be refundable to Seller pursuant to Section 2(b) of this Exhibit B. The Parties agree that Buyer’s receipt of Daily Delay Damages shall be Buyer’s sole and exclusive remedy for Seller’s unexcused delay in achieving the Major Project Development Milestones, but shall (x) not be construed as Buyer’s declaration that an Event of Default has occurred under any provision of Section 11.1 and (y) not limit Buyer’s right to declare an Event of Default pursuant to Section 11.1(b)(ii) and receive a Damage Payment upon exercise of Buyer’s default right pursuant to Section 11.2.

2. Commercial Operation of the Facility. “Commercial Operation” means the condition existing when Seller has fulfilled all of the conditions precedent in Section 2.2 of the Agreement and provided Notice to Buyer substantially in the form of Exhibit H (the “COD Certificate”). The “Commercial Operation Date” shall be the later of (x) the Expected Commercial Operation Date, or (y) the date on which Commercial Operation is achieved. (a) Seller shall cause Commercial Operation for the Facility to occur by the Guaranteed Commercial Operation Date. Seller shall notify Buyer that it intends to achieve Commercial Operation at least sixty (60) days before the anticipated Commercial Operation Date.

Attachment Staff Report Item 15C
Attachment Staff Report Item 15C
Attachment Staff Report Item 15C
Attachment Staff Report Item 15C
Attachment Staff Report Item 15C

Exhibit C - 2
obligation to deliver Facility Energy and Product, shall be effective regardless of whether the sale of Facility Energy is eligible for, or receives Tax Credits during the Contract Term.

Attachment Staff Report Item 15C
Exhibit D - 1

EXHIBIT D

SCHEDULING COORDINATOR RESPONSIBILITIES
Scheduling Coordinator Responsibilities.
(a) Buyer as Scheduling Coordinator for the Facility. Upon Initial Synchronization of the Facility to the CAISO Grid, Buyer shall be the Scheduling Coordinator or designate a qualified third party to provide Scheduling Coordinator services with the CAISO for the Facility for the delivery and the receipt of Test Energy and the Product at the Delivery Point and for the purposes of conducting Storage Capacity Tests. At least thirty (30) days prior to the Initial Synchronization of the Facility to the CAISO Grid, (i) Seller shall take all actions and execute and deliver to Buyer and the CAISO all documents necessary to authorize or designate Buyer (or Buyer’s designee) as the Scheduling Coordinator for the Facility effective as of the Initial Synchronization of the Facility to the CAISO Grid, and (ii) Buyer shall, and shall cause its designee to, take all actions and execute and deliver to Seller and the CAISO all documents necessary to authorize or designate Buyer or its designee as the Scheduling Coordinator for the Facility effective as of the Initial Synchronization of the Facility to the CAISO Grid. On and after Initial Synchronization of the Facility to the CAISO Grid, Seller shall not authorize or designate any other party to act as the Facility’s Scheduling Coordinator, nor shall Seller perform for its own benefit the duties of Scheduling Coordinator, and Seller shall not revoke Buyer’s authorization to act as the Facility’s Scheduling Coordinator unless agreed to by Buyer. Buyer (as the Facility’s SC) shall submit Schedules to the CAISO in accordance with this Agreement and the applicable CAISO Tariff, protocols and Scheduling practices for Product on a day-ahead, hour-ahead, fifteen-minute market or real time basis, as determined by Buyer.
(b) Notices. Buyer (as the Facility’s SC) shall provide Seller with access to a web-based system through which Seller shall submit to Buyer and the CAISO all notices and updates required under the CAISO Tariff regarding the Facility’s status, including, but not limited to, all outage requests, forced outages, forced outage reports, clearance requests, or must offer waiver forms. Seller will cooperate with Buyer to provide such notices and updates. If the web-based system is not available, Seller shall promptly submit such information to Buyer and the CAISO (in order of preference) telephonically, by electronic mail, transmission to the personnel designated to receive such information.
(c) CAISO Costs and Revenues. Except during a Storage Capacity Test or as otherwise set forth below, Buyer (as Scheduling Coordinator for the Facility) shall be responsible for CAISO costs (including penalties, Imbalance Energy costs, and other charges) and shall be entitled to all CAISO revenues (including credits, Imbalance Energy revenues, and other payments), including revenues associated with CAISO dispatches, bid cost recovery, Inter-SC Trade credits, or other credits in respect of the Product Scheduled or delivered from the Facility. Seller shall be responsible for all CAISO penalties resulting from any failure by Seller to abide by the CAISO Tariff or the outage notification requirements set forth in this Agreement (except to the extent such non-compliance is caused by Buyer’s failure to perform its duties as Scheduling Coordinator for the Facility). The Parties agree that any Availability Incentive Payments (as defined in the CAISO Tariff) are for the benefit of the Seller and for Seller’s account and that any Non-Availability Charges (as defined in the CAISO Tariff) are the responsibility of the Seller and for Seller’s Attachment Staff Report Item 15C

Exhibit D - 2
account. In addition, if during the Delivery Term, the CAISO implements or has implemented any sanction or penalty related to scheduling, outage reporting, or generator operation, and any such sanctions or penalties are imposed upon the Facility or to Buyer as Scheduling Coordinator due to failure by Seller to abide by the CAISO Tariff or the outage notification requirements set forth in this Agreement, the cost of the sanctions or penalties shall be the Seller’s responsibility. (d) CAISO Settlements. Buyer (as the Facility’s SC) shall be responsible for all settlement functions with the CAISO related to the Facility. Buyer shall render a separate invoice to Seller for any CAISO payments, charges or penalties (“CAISO Charges Invoice”) for which Seller is responsible under this Agreement. CAISO Charges Invoices shall be rendered after settlement information becomes available from the CAISO that identifies any CAISO charges.

Notwithstanding the foregoing, Seller acknowledges that the CAISO will issue additional invoices reflecting CAISO adjustments to such CAISO charges. Buyer will review, validate, and if requested by Seller under paragraph (e) below, dispute any charges that are the responsibility of Seller in a timely manner and consistent with Buyer’s existing settlement processes for charges that are Buyer’s responsibilities. Subject to Seller’s right to dispute and to have Buyer pursue the dispute of any such invoices, Seller shall pay the amount of CAISO Charges Invoices within ten (10) Business Days of Seller’s receipt of the CAISO Charges Invoice. If Seller fails to pay such CAISO Charges Invoice within that period, Buyer may net or offset any amounts owing to it for these CAISO Charges Invoices against any future amounts it may owe to Seller under this Agreement. The obligations under this Section with respect to payment of CAISO Charges Invoices shall survive the expiration or termination of this Agreement. (e) Dispute Costs. Buyer (as the Facility’s SC) may be required by Seller to dispute CAISO settlements in respect of the Facility. Seller agrees to pay Buyer’s costs and expenses (including reasonable attorneys’ fees) associated with its involvement with such CAISO disputes to the extent they relate to CAISO charges payable by Seller with respect to the Facility that Seller has directed Buyer to dispute.
(f) Terminating Buyer’s Designation as Scheduling Coordinator. At least thirty (30) days prior to expiration of this Agreement or as soon as reasonably practicable upon an earlier termination of this Agreement, the Parties will take all actions necessary to terminate the designation of Buyer as Scheduling Coordinator for the Facility as of 11:59 p.m. on such expiration date.
(g) Master Data File and Resource Data Template. Seller shall provide the data to the CAISO (and to Buyer) that is required for the CAISO’s Master Data File and Resource Data Template (or successor data systems) for the Facility consistent with this Agreement. Neither Party shall change such data without the other Party’s prior written consent. (h) NERC Reliability Standards. Buyer (as Scheduling Coordinator) shall cooperate reasonably with Seller to the extent necessary to enable Seller to comply, and for Seller to demonstrate Seller’s compliance with, NERC reliability standards. This cooperation shall include the provision of information in Buyer’s possession that Buyer (as Scheduling Coordinator) has provided to the CAISO related to the Facility or actions taken by Buyer (as Scheduling Coordinator) related to Seller’s compliance with NERC reliability standards.

Attachment Staff Report Item 15C
Exhibit E - 1

EXHIBIT E

PROGRESS REPORTING FORM
Each Progress Report must include the following items:

1. Executive Summary.

2. Facility description.

3. Site plan of the Facility.

4. Description of any material planned changes to the Facility or the site.

5. Gantt chart schedule showing progress on achieving each of the Milestones.

6. Summary of activities during the previous calendar quarter or month, as applicable, including any OSHA labor hour reports.

7. Forecast of activities scheduled for the current calendar quarter.

8. Written description about the progress relative to Seller’s Milestones, including whether Seller has met or is on target to meet the Milestones.

9. List of issues that are likely to potentially affect Seller’s Milestones.

10. A status report of start-up activities including a forecast of activities ongoing and after start-up, a report on Facility performance including performance projections for the next twelve (12) months.

11. Prevailing wage reports if required by Law.

12. Progress and schedule of all major agreements, contracts, permits, approvals, technical studies, financing agreements and major equipment purchase orders showing the start dates, completion dates, and completion percentages.

13. Pictures, in sufficient quantity and of appropriate detail, in order to document construction and startup progress of the Facility, the interconnection into the Transmission System and all other interconnection utility services.

14. Supplier Diversity Reporting (if applicable). Format to be provided by Buyer.

15. Any other documentation reasonably requested by Buyer.

16. Progress with respect to the tax equity arrangements for the Facility.

Attachment Staff Report Item 15C
Exhibit F-1 - 1
EXHIBIT F-1

AVERAGE EXPECTED ENERGY
1:00 2:00 3:00 4:00 5:00 6:00 7:00 8:00 9:00 10:00 11:00 12:00 13:00 14:00 15:00 16:00 17:00 18:00 19:00 20:00 21:00 22:00 23:00 24:00 The foregoing table is provided for informational purposes only, and it shall not constitute, or be deemed to constitute, an obligation of any of the Parties to this Agreement.

Attachment Staff Report Item 15C
Exhibit F-2 - 1
EXHIBIT F-2

AVAILABLE CAPACITY
The following tables are provided for informational purposes only, and shall not constitute, or be deemed to constitute, an obligation of any of the Parties to this Agreement.

Available Generating Capacity, MWh Per Hour – January
The following table is provided for informational purposes only, and it shall not constitute, or be deemed to constitute, an obligation of any of the Parties to this Agreement.
1:00 2:00 3:00 4:00 5:00 6:00 7:00 8:00 9:00 10:00 11:00 12:00 13:00 14:00 15:00 16:00 17:00 18:00 19:00 20:00 21:00 22:00 23:00 24:00 Attachment Staff Report Item 15C

Exhibit F-2 - 2
Attachment Staff Report Item 15C

Exhibit F-2 - 3
Available Generating Capacity, MWh Per Hour – February
The following table is provided for informational purposes only, and it shall not constitute, or be deemed to constitute, an obligation of any of the Parties to this Agreement.
1:00 2:00 3:00 4:00 5:00 6:00 7:00 8:00 9:00 10:00 11:00 12:00 13:00 14:00 15:00 16:00 17:00 18:00 19:00 20:00 21:00 22:00 23:00 24:00 Attachment Staff Report Item 15C

Exhibit F-2 - 4
Available Generating Capacity, MWh Per Hour – March
The following table is provided for informational purposes only, and it shall not constitute, or be deemed to constitute, an obligation of any of the Parties to this Agreement.
1:00 2:00 3:00 4:00 5:00 6:00 7:00 8:00 9:00 10:00 11:00 12:00 13:00 14:00 15:00 16:00 17:00 18:00 19:00 20:00 21:00 22:00 23:00 24:00 Attachment Staff Report Item 15C

Exhibit F-2 - 5
Available Generating Capacity, MWh Per Hour – April
The following table is provided for informational purposes only, and it shall not constitute, or be deemed to constitute, an obligation of any of the Parties to this Agreement.
1:00 2:00 3:00 4:00 5:00 6:00 7:00 8:00 9:00 10:00 11:00 12:00 13:00 14:00 15:00 16:00 17:00 18:00 19:00 20:00 21:00 22:00 23:00 24:00 Attachment Staff Report Item 15C

Exhibit F-2 - 6
Available Generating Capacity, MWh Per Hour – May
The following table is provided for informational purposes only, and it shall not constitute, or be deemed to constitute, an obligation of any of the Parties to this Agreement.
1:00 2:00 3:00 4:00 5:00 6:00 7:00 8:00 9:00 10:00 11:00 12:00 13:00 14:00 15:00 16:00 17:00 18:00 19:00 20:00 21:00 22:00 23:00 24:00 Attachment Staff Report Item 15C

Exhibit F-2 - 7
Available Generating Capacity, MWh Per Hour – June
The following table is provided for informational purposes only, and it shall not constitute, or be deemed to constitute, an obligation of any of the Parties to this Agreement.
1:00 2:00 3:00 4:00 5:00 6:00 7:00 8:00 9:00 10:00 11:00 12:00 13:00 14:00 15:00 16:00 17:00 18:00 19:00 20:00 21:00 22:00 23:00 24:00 Attachment Staff Report Item 15C

Exhibit F-2 - 8
Available Generating Capacity, MWh Per Hour – July
The following table is provided for informational purposes only, and it shall not constitute, or be deemed to constitute, an obligation of any of the Parties to this Agreement.
1:00 2:00 3:00 4:00 5:00 6:00 7:00 8:00 9:00 10:00 11:00 12:00 13:00 14:00 15:00 16:00 17:00 18:00 19:00 20:00 21:00 22:00 23:00 24:00 Attachment Staff Report Item 15C

Exhibit F-2 - 9
Available Generating Capacity, MWh Per Hour – August
The following table is provided for informational purposes only, and it shall not constitute, or be deemed to constitute, an obligation of any of the Parties to this Agreement.
1:00 2:00 3:00 4:00 5:00 6:00 7:00 8:00 9:00 10:00 11:00 12:00 13:00 14:00 15:00 16:00 17:00 18:00 19:00 20:00 21:00 22:00 23:00 24:00 Attachment Staff Report Item 15C

Exhibit F-2 - 10
Available Generating Capacity, MWh Per Hour – September The following table is provided for informational purposes only, and it shall not constitute, or be deemed to constitute, an obligation of any of the Parties to this Agreement.
1:00 2:00 3:00 4:00 5:00 6:00 7:00 8:00 9:00 10:00 11:00 12:00 13:00 14:00 15:00 16:00 17:00 18:00 19:00 20:00 21:00 22:00 23:00 24:00 Attachment Staff Report Item 15C

Exhibit F-2 - 11
Available Generating Capacity, MWh Per Hour October
The following table is provided for informational purposes only, and it shall not constitute, or be deemed to constitute, an obligation of any of the Parties to this Agreement.
1:00 2:00 3:00 4:00 5:00 6:00 7:00 8:00 9:00 10:00 11:00 12:00 13:00 14:00 15:00 16:00 17:00 18:00 19:00 20:00 21:00 22:00 23:00 24:00 Attachment Staff Report Item 15C

Exhibit F-2 - 12
Available Generating Capacity, MWh Per Hour – November
The following table is provided for informational purposes only, and it shall not constitute, or be deemed to constitute, an obligation of any of the Parties to this Agreement.
1:00 2:00 3:00 4:00 5:00 6:00 7:00 8:00 9:00 10:00 11:00 12:00 13:00 14:00 15:00 16:00 17:00 18:00 19:00 20:00 21:00 22:00 23:00 24:00 Attachment Staff Report Item 15C

Exhibit F-2 - 13
Available Generating Capacity, MWh Per Hour December
The following table is provided for informational purposes only, and it shall not constitute, or be deemed to constitute, an obligation of any of the Parties to this Agreement.
1:00 2:00 3:00 4:00 5:00 6:00 7:00 8:00 9:00 10:00 11:00 12:00 13:00 14:00 15:00 16:00 17:00 18:00 19:00 20:00 21:00 22:00 23:00 24:00 Attachment Staff Report Item 15C
Attachment Staff Report Item 15C
Attachment Staff Report Item 15C
Exhibit H - 1

EXHIBIT H

FORM OF COMMERCIAL OPERATION DATE CERTIFICATE
This certification (“Certification”) of Commercial Operation is delivered by _______[licensed professional engineer] (“Engineer”) to East Bay Community Energy Authority, a California joint powers authority (“Buyer”) in accordance with the terms of that certain Renewable Power Purchase Agreement dated _______ (“Agreement”) by and between [Seller] and Buyer. All capitalized terms used in this Certification but not otherwise defined herein shall have the respective meanings assigned to such terms in the Agreement.

As of _[DATE]_, Engineer hereby certifies and represents to Buyer the following:

1. The Generating Facility is fully operational, reliable and interconnected, fully integrated and synchronized with the Transmission System.

2. Seller has installed equipment for the Generating Facility with a nameplate capacity of no less than ninety-five percent (95%) of the Guaranteed Capacity.

3. Seller has installed equipment for the Storage Facility with a nameplate capacity of no less than ninety-five percent (95%) of the Storage Contract Capacity.

4. The Generating Facility’s testing included a performance test demonstrating peak electrical output of no less than ninety-five (95%) of the Guaranteed Capacity for the Generating Facility at the Delivery Point, as adjusted for ambient conditions on the date of the Facility testing, and such peak electrical output, as adjusted, was [peak output in MW].

5. The Storage Facility is fully capable of charging, storing and Discharging Energy up to no less than ninety-five percent (95%) of the Storage Contract Capacity and receiving instructions to charge, store and discharge energy, all within the operational constraints and subject to the applicable Operating Restrictions.

6. Authorization to parallel the Facility was obtained by the Participating Transmission Provider, [Name of Participating Transmission Owner as appropriate] on _[DATE]_.

7. The Transmission Provider has provided documentation supporting full unrestricted release for Commercial Operation by [Name of Participating Transmission Owner as appropriate] on _[DATE]_.

8. The CAISO has provided notification supporting Commercial Operation, in accordance with the CAISO Tariff on _[DATE]_.

Attachment Staff Report Item 15C

Exhibit H - 2
EXECUTED by [LICENSED PROFESSIONAL ENGINEER]
this ________ day of _____________, 20__.
[LICENSED PROFESSIONAL ENGINEER]
By:

Its:

Date:

Attachment Staff Report Item 15C
Exhibit I - 1

EXHIBIT I

FORM OF INSTALLED CAPACITY CERTIFICATE
This certification (“Certification”) of Installed Capacity is delivered by [licensed professional engineer] (“Engineer”) to East Bay Community Energy Authority, a California joint powers authority (“Buyer”) in accordance with the terms of that certain Renewable Power Purchase Agreement dated __________ (“Agreement”) by and between [SELLER ENTITY] and Buyer. All capitalized terms used in this Certification but not otherwise defined herein shall have the respective meanings assigned to such terms in the Agreement.

I hereby certify the following:

1. The performance test for the Generating Facility demonstrated peak electrical output of __ MW AC at the Delivery Point, as adjusted for ambient conditions on the date of the performance test (“Installed PV Capacity”);

2. The Storage Capacity Test demonstrated a maximum dependable operating capability that can be sustained for four (4) consecutive hours to discharge electric energy of __ MW AC to the Delivery Point, in accordance with the testing procedures, requirements and protocols set forth in Section 4.9 and Exhibit O (the “Installed Battery Capacity”); and

3. The sum of (a) and (b) is __ MW AC and shall be the “Installed Capacity”.

EXECUTED by [LICENSED PROFESSIONAL ENGINEER]
this ________ day of _____________, 20__.
[LICENSED PROFESSIONAL ENGINEER]
By:

Its:

Date:

Attachment Staff Report Item 15C
Exhibit J - 1

EXHIBIT J

FORM OF CONSTRUCTION START DATE CERTIFICATE
This certification of Construction Start Date (“Certification”) is delivered by [SELLER ENTITY] (“Seller”) to East Bay Community Energy Authority, a California joint powers authority (“Buyer”) in accordance with the terms of that certain Renewable Power Purchase Agreement dated __________ (“Agreement”) by and between Seller and Buyer. All capitalized terms used in this Certification but not otherwise defined herein shall have the respective meanings assigned to such terms in the Agreement.

Seller hereby certifies and represents to Buyer the following:

1. Construction Start (as defined in Exhibit B of the Agreement) has occurred, and a copy of the notice to proceed that Seller issued to its contractor as part of Construction Start is attached hereto;

2. the Construction Start Date occurred on _____________ (the “Construction Start Date”); and

3. the precise Site on which the Facility is located is, which must be within the boundaries of the previously identified Site: _________________________________________.

IN WITNESS WHEREOF, the undersigned has executed this Certification on behalf of Seller as of the ___ day of ________.
[SELLER ENTITY]
By:

Its:

Date:

Attachment Staff Report Item 15C
Exhibit K - 1

EXHIBIT K

FORM OF LETTER OF CREDIT
[Issuing Bank Letterhead and Address]
IRREVOCABLE STANDBY LETTER OF CREDIT NO. [XXXXXXX]
Date:

Bank Ref.:

Amount: US$[XXXXXXXX]
Expiry Date:

Beneficiary:

East Bay Community Energy Authority, a California joint powers authority 1111 Broadway, Suite 300
Oakland, CA 94607
Ladies and Gentlemen:

By the order of __________ (“Applicant”), we, [insert bank name and address] (“Issuer”) hereby issue our Irrevocable Standby Letter of Credit No. [XXXXXXX] (the “Letter of Credit”) in favor of East Bay Community Energy Authority, a California joint powers authority (“Beneficiary”), 1111 Broadway, Suite 300, Oakland, CA 94607, for an amount not to exceed the aggregate sum of U.S. $[XXXXXX] (United States Dollars [XXXXX] and 00/100), pursuant to that certain Renewable Power Purchase Agreement dated as of ______ and as amended (the “Agreement”) between Applicant and Beneficiary. This Letter of Credit shall become effective immediately and shall expire on __________ __, 201_.

Funds under this Letter of Credit are available to you against your draft(s) drawn on us at sight, referencing thereon our Letter of Credit No. [XXXXXXX] accompanied by your dated statement purportedly signed by your duly authorized representative, in the form attached hereto as Exhibit A, containing one of the two alternative paragraphs set forth in paragraph 2 therein.

We hereby agree with the Beneficiary that all drafts drawn under and in compliance with the terms of this Letter of Credit, that such drafts will be duly honored upon presentation to the drawee at [insert bank address]. Payment shall be made by Issuer in U.S. dollars with Issuer’s own immediately available funds.

Partial draws are permitted under this Letter of Credit.

It is a condition of this Letter of Credit that it shall be deemed automatically extended without an amendment for a one year period beginning on the present expiry date hereof and upon each Attachment Staff Report Item 15C

Exhibit K - 2
anniversary for such date, unless at least one hundred twenty (120) days prior to any such expiry date we have sent to you written notice by overnight courier service that we elect not to extend this Letter of Credit, in which case it will expire on its the date specified in such notice. No presentation made under this Letter of Credit after such expiry date will be honored.

Notwithstanding any reference in this Letter of Credit to any other documents, instruments or agreements, this Letter of Credit contains the entire agreement between Beneficiary and Issuer relating to the obligations of Issuer hereunder.

This Letter of Credit is subject to the Uniform Customs and Practice for Documentary Credits (2007 Revision) International Chamber of Commerce Publication No. 600 (the “UCP”), except to the extent that the terms hereof are inconsistent with the provisions of the UCP, including but not limited to Articles 14(b) and 36 of the UCP, in which case the terms of this Letter of Credit shall govern. In the event of an act of God, riot, civil commotion, insurrection, war or any other cause beyond Issuer’s control (as defined in Article 36 of the UCP) that interrupts Issuer’s business and causes the place for presentation of the Letter of Credit to be closed for business on the last day for presentation, the expiry date of the Letter of Credit will be automatically extended without amendment to a date thirty (30) calendar days after the place for presentation reopens for business.

Please address all correspondence regarding this Letter of Credit to the attention of the Letter of Credit Department at [insert bank address information], referring specifically to Issuer’s Letter of Credit No. [XXXXXXX]. For telephone assistance, please contact Issuer’s Standby Letter of Credit Department at [XXX-XXX-XXXX] and have this Letter of Credit available. [Bank Name]
___________________________
[Insert officer name]
[Insert officer title]
Attachment Staff Report Item 15C
Exhibit K - 3
(DRAW REQUEST SHOULD BE ON BENEFICIARY’S LETTERHEAD)
Drawing Certificate
[Insert Bank Name and Address]
Ladies and Gentlemen:

The undersigned, a duly authorized representative of East Bay Community Energy Authority, a California joint powers authority, 1111 Broadway, Suite 300, Oakland, CA 94607, as beneficiary (the “Beneficiary”) of the Irrevocable Letter of Credit No. [XXXXXXX] (the “Letter of Credit”) issued by [insert bank name] (the “Bank”) by order of __________ (the “Applicant”), hereby certifies to the Bank as follows:

1. Applicant and Beneficiary are party to that certain Renewable Power Purchase Agreement dated as of ___________, 20__ (the “Agreement”).

2. Beneficiary is making a drawing under this Letter of Credit in the amount of U.S. $___________ because a Seller Event of Default (as such term is defined in the Agreement) has occurred.

3. The undersigned is a duly authorized representative of East Bay Community Energy Authority, a California joint powers authority and is authorized to execute and deliver this Drawing Certificate on behalf of Beneficiary.

You are hereby directed to make payment of the requested amount to East Bay Community Energy Authority, a California joint powers authority by wire transfer in immediately available funds to the following account:
[Specify account information]
East Bay Community Energy Authority
_______________________________
Name and Title of Authorized Representative
Date___________________________
Attachment Staff Report Item 15C

Exhibit L - 1

EXHIBIT L

FORM OF GUARANTY
This Guaranty (this “Guaranty”) is entered into as of [_____] (the “Effective Date”) by and between [_____], a [______] (“Guarantor”), and East Bay Community Energy Authority, a California joint powers authority (together with its successors and permitted assigns, “Buyer”).

Recitals
A. Buyer and [SELLER ENTITY], a _____________________ (“Seller”), entered into that certain Renewable Power Purchase Agreement (as amended, restated or otherwise modified from time to time, the “PPA”) dated as of [____], 20___.

B. Guarantor is entering into this Guaranty as Performance Security to secure Seller’s obligations under the PPA, as required by Section 8.8 of the PPA.

C. It is in the best interest of Guarantor to execute this Guaranty inasmuch as Guarantor will derive substantial direct and indirect benefits from the execution and delivery of the PPA.

D. Initially capitalized terms used but not defined herein have the meaning set forth in the PPA.

Agreement

1. Guaranty. For value received, Guarantor does hereby unconditionally, absolutely and irrevocably guarantee, as primary obligor and not as a surety, to Buyer the full, complete and prompt payment by Seller of any and all amounts and payment obligations now or hereafter owing from Seller to Buyer under the PPA, including, without limitation, compensation for penalties, the Termination Payment, indemnification payments or other damages, as and when required pursuant to the terms of the PPA (the “Guaranteed Amount”), provided, that Guarantor’s aggregate liability under or arising out of this Guaranty shall not exceed ________ Dollars ($___________).

The Parties understand and agree that any payment by Guarantor or Seller of any portion of the Guaranteed Amount shall thereafter reduce Guarantor’s maximum aggregate liability hereunder on a dollar-for-dollar basis. This Guaranty is an irrevocable, absolute, unconditional and continuing guarantee of the full and punctual payment and performance, and not of collection, of the Guaranteed Amount and, except as otherwise expressly addressed herein, is in no way conditioned upon any requirement that Buyer first attempt to collect the payment of the Guaranteed Amount from Seller, any other guarantor of the Guaranteed Amount or any other Person or entity or resort to any other means of obtaining payment of the Guaranteed Amount. In the event Seller shall fail to duly, completely or punctually pay any Guaranteed Amount as required pursuant to the PPA, Guarantor shall promptly pay such amount as required herein.

2. Demand Notice. For avoidance of doubt, a payment shall be due for purposes of this Guaranty only when and if a payment is due and payable by Seller to Buyer under the terms and conditions of the Agreement. If Seller fails to pay any Guaranteed Amount as required pursuant to the PPA for five (5) Business Days following Seller’s receipt of Buyer’s written notice of such failure (the “Demand Notice”), then Buyer may elect to exercise its rights under this Guaranty Attachment Staff Report Item 15C

Exhibit L - 2
and may make a demand upon Guarantor (a “Payment Demand”) for such unpaid Guaranteed Amount. A Payment Demand shall be in writing and shall reasonably specify in what manner and what amount Seller has failed to pay and an explanation of why such payment is due and owing, with a specific statement that Buyer is requesting that Guarantor pay under this Guaranty.

Guarantor shall, within five (5) Business Days following its receipt of the Payment Demand, pay the Guaranteed Amount to Buyer.

3. Scope and Duration of Guaranty. This Guaranty applies only to the Guaranteed Amount.

This Guaranty shall continue in full force and effect from the Effective Date until the earlier of the following: (x) all Guaranteed Amounts have been paid in full (whether directly or indirectly through set-off or netting of amounts owed by Buyer to Seller), or (y) replacement Performance Security is provided in an amount and form required by the terms of the PPA. Further, this Guaranty (a) shall remain in full force and effect without regard to, and shall not be affected or impaired by any invalidity, irregularity or unenforceability in whole or in part of this Guaranty, and (b) subject to the preceding sentence, shall be discharged only by complete performance of the undertakings herein. Without limiting the generality of the foregoing, the obligations of the Guarantor hereunder shall not be released, discharged, or otherwise affected and this Guaranty shall not be invalidated or impaired or otherwise affected for the following reasons:
(i) the extension of time for the payment of any Guaranteed Amount, or (ii) any amendment, modification or other alteration of the PPA, or (iii) any indemnity agreement Seller may have from any party, or (iv) any insurance that may be available to cover any loss, except to the extent insurance proceeds are used to satisfy the Guaranteed Amount, or
(v) any voluntary or involuntary liquidation, dissolution, receivership, insolvency, bankruptcy, assignment for the benefit of creditors, reorganization, arrangement, composition or readjustment of, or other similar proceeding affecting, Seller or any of its assets, including but not limited to any rejection or other discharge of Seller’s obligations under the PPA imposed by any court, trustee or custodian or any similar official or imposed by any law, statue or regulation, in each such event in any such proceeding, or
(vi) the release, modification, waiver or failure to pursue or seek relief with respect to any other guaranty, pledge or security device whatsoever, or (vii) any payment to Buyer by Seller that Buyer subsequently returns to Seller pursuant to court order in any bankruptcy or other debtor-relief proceeding, or (viii) those defenses based upon (A) the legal incapacity or lack of power or authority of any Person, including Seller and any representative of Seller to enter into the PPA or perform its obligations thereunder, (B) lack of due execution, delivery, validity or enforceability, including of the PPA, or (C) Seller’s inability to pay any Guaranteed Amount or perform its obligations under the PPA, or
Attachment Staff Report Item 15C

Exhibit L - 3
(ix) any other event or circumstance that may now or hereafter constitute a defense to payment of the Guaranteed Amount, including, without limitation, statute of frauds and accord and satisfaction;
provided that Guarantor reserves the right to assert for itself any defenses, setoffs or counterclaims that Seller is or may be entitled to assert against Buyer (except for such defenses, setoffs or counterclaims that may be asserted by Seller with respect to the PPA, but that are expressly waived under any provision of this Guaranty).

4. Waivers by Guarantor. Guarantor hereby unconditionally waives as a condition precedent to the performance of its obligations hereunder, with the exception of the requirements in Paragraph 2, (a) notice of acceptance, presentment or protest with respect to the Guaranteed Amounts and this Guaranty, (b) notice of any action taken or omitted to be taken by Buyer in reliance hereon, (c) any requirement that Buyer exhaust any right, power or remedy or proceed against Seller under the PPA, and (d) any event, occurrence or other circumstance which might otherwise constitute a legal or equitable discharge of a surety. Without limiting the generality of the foregoing waiver of surety defenses, it is agreed that the occurrence of any one or more of the following shall not affect the liability of Guarantor hereunder:
(i) at any time or from time to time, without notice to Guarantor, the time for payment of any Guaranteed Amount shall be extended, or such performance or compliance shall be waived; (ii) the obligation to pay any Guaranteed Amount shall be modified, supplemented or amended in any respect in accordance with the terms of the PPA; (iii) subject to Section 10, any (a) sale, transfer or consolidation of Seller into or with any other entity, (b) sale of substantial assets by, or restructuring of the corporate existence of, Seller or (c) change in ownership of any membership interests of, or other ownership interests in, Seller; or
(iv) the failure by Buyer or any other Person to create, preserve, validate, perfect or protect any security interest granted to, or in favor of, Buyer or any Person.

5. Subrogation. Notwithstanding any payments that may be made hereunder by the Guarantor, Guarantor hereby agrees that until the earlier of payment in full of all Guaranteed Amounts or expiration of the Guaranty in accordance with Section 3, it shall not be entitled to, nor shall it seek to, exercise any right or remedy arising by reason of its payment of any Guaranteed Amount under this Guaranty, whether by subrogation or otherwise, against Seller or seek contribution or reimbursement of such payments from Seller.

6. Representations and Warranties. Guarantor hereby represents and warrants that (a) it has all necessary and appropriate [limited liability company][corporate] powers and authority and the legal right to execute and deliver, and perform its obligations under, this Guaranty, (b) this Guaranty constitutes its legal, valid and binding obligations enforceable against it in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency, moratorium and other similar laws affecting enforcement of creditors’ rights or general principles of equity, (c) the execution, delivery and performance of this Guaranty does not and will not contravene Guarantor’s organizational documents, any applicable Law or any contractual provisions binding on or Attachment Staff Report Item 15C

Exhibit L - 4
affecting Guarantor, (d) there are no actions, suits or proceedings pending before any court, governmental agency or arbitrator, or, to the knowledge of the Guarantor, threatened, against or affecting Guarantor or any of its properties or revenues which may, in any one case or in the aggregate, adversely affect the ability of Guarantor to enter into or perform its obligations under this Guaranty, and (e) no consent or authorization of, filing with, or other act by or in respect of, any arbitrator or Governmental Authority, and no consent of any other Person (including, any stockholder or creditor of the Guarantor), that has not heretofore been obtained is required in connection with the execution, delivery, performance, validity or enforceability of this Guaranty by Guarantor.

7. Notices. Notices under this Guaranty shall be deemed received if sent to the address specified below: (i) on the day received if served by overnight express delivery, and (ii) four Business Days after mailing if sent by certified, first class mail, return receipt requested. If transmitted by facsimile, such notice shall be deemed received when the confirmation of transmission thereof is received by the party giving the notice. Any party may change its address or facsimile to which notice is given hereunder by providing notice of the same in accordance with this Paragraph 8.

If delivered to Buyer, to it at [____]
Attn: [____]
Fax: [____]
If delivered to Guarantor, to it at [____]
Attn: [____]
Fax: [____]

8. Governing Law and Forum Selection. This Guaranty shall be governed by, and interpreted and construed in accordance with, the laws of the United States and the State of California, excluding choice of law rules. The Parties agree that any suit, action or other legal proceeding by or against any party (or its affiliates or designees) with respect to or arising out of this Guaranty shall be brought in the federal courts of the United States or the courts of the State of California sitting in the City and County of Alameda, California. [Jury trial waiver to be included]

9. Miscellaneous. This Guaranty shall be binding upon Guarantor and its successors and assigns and shall inure to the benefit of Buyer and its successors and permitted assigns pursuant to the PPA. No provision of this Guaranty may be amended or waived except by a written instrument executed by Guarantor and Buyer. This Guaranty is not assignable by Guarantor without the prior written consent of Buyer. No provision of this Guaranty confers, nor is any provision intended to confer, upon any third party (other than Buyer’s successors and permitted assigns) any benefit or right enforceable at the option of that third party. This Guaranty embodies the entire agreement and understanding of the parties hereto with respect to the subject matter hereof and supersedes all prior or contemporaneous agreements and understandings of the parties hereto, verbal or written, relating to the subject matter hereof. If any provision of this Guaranty is determined to be illegal or unenforceable (i) such provision shall be deemed restated in accordance with applicable Laws to Attachment Staff Report Item 15C

Exhibit L - 5
reflect, as nearly as possible, the original intention of the parties hereto and (ii) such determination shall not affect any other provision of this Guaranty and all other provisions shall remain in full force and effect. This Guaranty may be executed in any number of separate counterparts, each of which when so executed shall be deemed an original, and all of said counterparts taken together shall be deemed to constitute one and the same instrument. This Guaranty may be executed and delivered by electronic means with the same force and effect as if the same was a fully executed and delivered original manual counterpart.
[Signature on next page]
Attachment Staff Report Item 15C
Exhibit L - 6
IN WITNESS WHEREOF, the undersigned has caused this Guaranty to be duly executed and delivered by its duly authorized representative on the date first above written.

GUARANTOR:
[_______]
By:______________________________
Printed Name:__________________
Title:____________________________
BUYER:
[_______]
By:______________________________
Printed Name:__________________
Title:____________________________
By:______________________________
Printed Name:__________________
Title:____________________________
Attachment Staff Report Item 15C
Exhibit M - 1

EXHIBIT M

FORM OF REPLACEMENT RA NOTICE
This Replacement RA Notice (this “Notice”) is delivered by [SELLER ENTITY] (“Seller”) to East Bay Community Energy Authority, a California joint powers authority (“Buyer”) in accordance with the terms of that certain Renewable Power Purchase Agreement dated __________ (“Agreement”) by and between Seller and Buyer. All capitalized terms used in this Notice but not otherwise defined herein shall have the respective meanings assigned to such terms in the Agreement.

Pursuant to Section 3.8(b) of the Agreement, Seller hereby provides the below Replacement RA product information:

Attachment Staff Report Item 15C
Exhibit M - 2
[SELLER ENTITY]
By:

Its:

Date:

Attachment Staff Report Item 15C
Attachment Staff Report Item 15C
Attachment Staff Report Item 15C
Attachment Staff Report Item 15C
Exhibit O - 1

EXHIBIT O

STORAGE CAPACITY TESTS
Storage Capacity Test Notice and Frequency
A. Commercial Operation Date Storage Capacity Test. Upon no less than ten (10) Business Days prior Notice to Buyer, Seller shall schedule and complete a Storage Capacity Test prior to the Commercial Operation Date. Such initial Storage Capacity Test shall be performed in accordance with this Exhibit O and shall establish the initial Storage Contract Capacity hereunder based on the actual capacity of the Storage Facility determined by such Storage Capacity Test.

B. Subsequent Storage Capacity Tests. Following the Commercial Operation Date, but not more than once per Contract Year within the first quarter of each Contract Year, upon no less than ten (10) Business Days prior Notice to Seller, Buyer shall have the right to require Seller to schedule and complete a Storage Capacity Test. In addition, Buyer shall have the right to require a retest of the most recent Storage Capacity Test at any time upon no less than five (5) Business Days prior written Notice to Seller if Buyer provides data with such Notice reasonably indicating that the Storage Capacity has varied materially from the results of the most recent Storage Capacity Test. Seller shall have the right to perform a Storage Capacity Test or run a retest of any Storage Capacity Test at any time during any Contract Year upon five (5) Business Days’ prior written Notice to Buyer (or any shorter period reasonably acceptable to Buyer consistent with Prudent Operating Practice). Notwithstanding anything herein to the contrary, any revenues associated with a Storage Capacity Test that is initiated by Seller shall accrue to Buyer.

C. Test Results and Re-Setting of Storage Capacity. No later than five (5) days following any Storage Capacity Test, Seller shall submit a testing report detailing results and findings of the test. The report shall include meter readings and plant log sheets verifying the operating conditions and output of the Storage Facility. In accordance with Section 4.9(c) of the Agreement and Part II(I) below, the actual capacity determined pursuant to a Storage Capacity Test (up to, but not in excess of, the original Storage Contract Capacity set forth on the Cover Sheet, as such original Storage Contract Capacity on the Cover Sheet may have been adjusted (if at all) pursuant to Exhibit B) shall become the new Storage Contract Capacity at the beginning of the day following the completion of the test for calculating the Storage Rate and all other purposes under this Agreement.

Storage Capacity Test Procedures
PART I. GENERAL.

Each Storage Capacity Test (including the initial Storage Capacity Test, each subsequent Storage Capacity Test, and all re-tests thereof permitted under paragraph B above) shall be conducted in accordance with Prudent Operating Practices and the provisions of this Exhibit O. For ease of reference, a Storage Capacity Test is sometimes referred to in this Exhibit O as a “SCT”. Buyer or its representative may be present for the SCT and may, for informational purposes only, use its own metering equipment (at Buyer’s sole cost).

Attachment Staff Report Item 15C

Exhibit O - 2
PART II. REQUIREMENTS APPLICABLE TO ALL STORAGE CAPACITY TESTS.

A. Purpose of Test. Each SCT shall:
(1) Determine an updated Storage Contract Capacity;
(2) Determine the amount of Energy required to fully charge the Storage Facility;
(3) Determine the Storage Facility charge ramp rate;
(4) Determine the Storage Facility discharge ramp rate.

B. Parameters. During each SCT, the following parameters shall be measured and recorded simultaneously for the Storage Facility, at a minimum of ten (10) minute intervals:
(1) time (minutes);
(2) charging energy (MWh);
(3) discharging energy (MWh);
(4) Stored Energy Level (MWh).

C. Site Conditions. During each SCT, the following conditions at the Site shall be measured and recorded simultaneously at thirty (30) minute intervals:
(1) Relative humidity (%);
(2) Barometric pressure (inches Hg) near the horizontal centerline of the Storage Facility; and
(3) Ambient air Temperature (°F).

D. Test Elements. Each SCT Shall include the following test elements:
(1) The discharging of the Storage Facility to 0% Stored Energy Level; (2) The charging of the Storage Facility at a constant power charge rate equal to the Storage Contract Capacity as of the commencement of the Storage Capacity Test;
(3) The measurement of the time from when the charge signal is sent until the constant power charge rate is achieved (dividing the constant power charge rate by this measurement will determine the updated charging ramp rate); Attachment Staff Report Item 15C
Exhibit O - 3
(4) The measurement of Energy, as measured by the Storage Facility Meter, that is required to charge the Storage Facility until either a 100% Stored Energy Level is achieved or the constant power charge rate starts to de-rate; (5) The discharging of the Storage Facility at a constant power discharge rate equal to the Storage Contract Capacity as of the commencement of the Storage Capacity Test;
(6) The measurement of the time from when the discharge signal is sent until the constant power discharge rate is achieved (dividing the constant power charge rate by this measurement will determine the updated discharging ramp rate);
(7) The measurement of Energy, as measured by the Storage Facility Meter, that is discharged from the Storage Facility to the Delivery Point until either a 0% Stored Energy Level is achieved or the constant power charge rate starts to de-rate (the Energy discharged divided by four (4) will determine the new Storage Contract Capacity).

E. Test Conditions.
(1) General. At all times during a SCT, the Storage Facility shall be operated in compliance with Prudent Operating Practices and all operating protocols recommended, required or established by the manufacturer for operation. (2) Abnormal Conditions. If abnormal operating conditions that prevent the recordation of any required parameter occur during a SCT (including a level of irradiance that does not permit the Generating Facility to produce sufficient Charging Energy), Seller may postpone or reschedule all or part of such SCT in accordance with Part II.F below.
(3) Instrumentation and Metering. Seller shall provide all instrumentation, metering and data collection equipment required to perform the SCT. The instrumentation, metering and data collection equipment electrical meters shall be calibrated in accordance with Prudent Operating Practice.

F. Incomplete Test. If any SCT is not completed in accordance herewith, Buyer may in its sole discretion: (i) accept the results up to the time the SCT stopped; (ii) require that the portion of the SCT not completed, be completed within a reasonable specified time period; or (iii) require that the SCT be entirely repeated.

Notwithstanding the above, if Seller is unable to complete a SCT due to a Force Majeure Event or the actions or inactions of Buyer or the CAISO or the PTO or the Transmission Provider, Seller shall be permitted to reconduct such SCT on dates and at times reasonably acceptable to the Parties.

G. Final Report. Within fifteen (15) Business Days after the completion of any SCT, Seller shall prepare and submit to Buyer a written report of the results of the SCT, which report shall include:

Attachment Staff Report Item 15C

Exhibit O - 4
(1) a record of the personnel present during the SCT that served in an operating, testing, monitoring or other such participatory role;
(2) the measured data for each parameter set forth in Part II.A through D, as applicable, including copies of the raw data taken during the test; (3) the current level of storage contract capacity, the amount of Energy required to fully charge the battery, the current charge and discharge ramp rate, and the Maximum Stored Energy Level, each determined by the SCT, including supporting calculations; and
(4) Seller’s statement of either Seller’s acceptance of the SCT or Seller’s rejection of the SCT results and reason(s) therefor.

Within ten (10) Business Days after receipt of such report, Buyer shall notify Seller in writing of either Buyer’s acceptance of the SCT results or Buyer’s rejection of the SCT and reason(s) therefor.

If either Party reasonably rejects the results of any SCT, such SCT shall be repeated in accordance with Part II.F.

H. Supplementary Storage Capacity Test Protocol. No later than sixty (60) days prior to commencing Facility construction, Seller shall deliver to Buyer for its review and approval (such approval not to be unreasonably delayed or withheld) a supplement to this Exhibit O with additional and supplementary details, procedures and requirements applicable to Storage Capacity Tests based on the then current design of the Facility (“Supplementary Storage Capacity Test Protocol”).

Thereafter, from time to time, Seller may deliver to Buyer for its review and approval (such approval not to be unreasonably delayed or withheld) any Seller recommended updates to the then current Supplementary Storage Capacity Test Protocol. The initial Supplementary Storage Capacity Test Protocol (and each update thereto), once approved by Buyer, shall be deemed an amendment to this Exhibit O.

I. Adjustment to Storage Contract Capacity. The total amount of discharged Energy delivered to the Delivery Point (expressed in MWh AC) during each of the first four hours of discharge (up to, but not in excess of, the product of (i) the original Storage Contract Capacity set forth on the Cover Sheet, as such original Storage Contract Capacity on the Cover Sheet may have been adjusted (if at all) under this Agreement, multiplied by (ii) 4 hours) shall be divided by four hours to determine the Storage Contract Capacity, which shall be expressed in MW AC, and shall be the new Storage Contract Capacity in accordance with Section 4.9(c) of the Agreement.

Attachment Staff Report Item 15C
Exhibit P - 1

EXHIBIT P

STORAGE FACILITY AVAILABILITY
Attachment Staff Report Item 15C

Exhibit P - 2
(i) If the Monthly Storage Availability is greater than or equal to the Guaranteed Storage Availability, then:
(ii) If the Monthly Storage Availability is less than the Guaranteed Storage Availability, but greater than or equal to then:
(iii) If the Monthly Storage Availability is less than then:

Attachment Staff Report Item 15C
Exhibit Q - 1

EXHIBIT Q

OPERATING RESTRICTIONS

Attachment Staff Report Item 15C
Exhibit R - 1

EXHIBIT R

METERING DIAGRAM

Attachment Staff Report Item 15C
Attachment Staff Report Item 15C
Exhibit S - 2
Attachment Staff Report Item 15C
Long-Term Agreements
for Approval
Joanie Brooke & Courtney Wall | July 16, 2025
Attachment Staff Report Item 15D
Agenda
2 1. Overview: Proposed Transactions

2. Challenges in the Marketplace

3. EDP – Company Overview

4. Sonrisa Transaction Details

5. Scarlet III Transaction Details
Attachment Staff Report Item 15D
Proposed Agreements
• Seeking approval for two new agreements and one amendment to an existing agreement ▪ All projects were developed by EDP Renewables North America ▪ All were offered bilaterally
• Sonrisa Project
▪ 1 new project
▪ Power Purchase Agreement (PPA) for 200 MW PV + 184 MW / 4hr BESS with EDPR CA Solar Park VI LLC ▪ At a future date, the Battery Energy Storage System (BESS) will be separated into a standalone agreement with Sonrisa BESS LLC
• Scarlet III Project
▪ 1 new project and 1 amendment to an existing agreement ▪ 70MW / 4hr Battery Energy Storage Agreement (ESA) with EDPR Scarlet III LLC ▪ Co-located with Ava’s existing Scarlet I facility (Scarlet 1: 100 MW PV & 30 MW / 4hr Battery Storage) ▪ When complete the Scarlet project (Scarlet 1 & 3) will be 100 MW PV & 100 MW / 4hr Battery Storage ▪ Amend the current Scarlet I PPA to adjust for the battery size expansion ▪ Terminate the active Scarlet III RA-Only agreement
3 Attachment Staff Report Item 15D
Challenges in the Marketplace
• California property tax exemption expiring for projects online after 12/31/2026 • Tariff uncertainty for major components
• Limited options to procure major components domestically • Approximately 90% of Utility Scale Battery Storage comes from China • 7/4/25 Reconciliation Bill and 7/7/25 Executive Order will phase out tax credits • Result: Project Developers are unwilling to take on tariff and tax credit price risk alone, and are asking for shared risk ownership through pre-negotiated price adjustment mechanisms • Prices for generation and storage resources have increased 30-40% since 2020, and Ava anticipates prices to increase further in the coming years.
4 Attachment Staff Report Item 15D
EDPR-NA – Company Overview
5 • EDP Renewables North America (EDP) was founded in 1998. Focused on development and operation of utility-scale wind, solar & storage in 20 US States, Canada and Mexico. • EDP North America’s Parent company is EDP Renewables a global company operating 20 GW of generation across 28 international markets.
• EDP operates 10.7 GW across 80 projects in the US, including 2.8 GW of solar and 180 MW of storage.
• EDP has experience with California’s CCAs and investor-owned utilities:
• Ava: Scarlet I (2024, 100 MW / 30 MW BESS), Scarlet II (2025, 200 MW / 75 MW BESS) • San Jose Clean Energy: Scarlet I (2024), Scarlet II (2025) • Redwood Coast Energy Authority: Sandrini II Solar (2024) + Storage (2025) • Southern California Edison: Windhub Solar (2019), Rising Tree I Wind (2014), Rising Tree III Wind (2015), Lone Valley Solar (2014) & Lone Valley Solar II (2014) • Shell Energy North America: Sandrini I Solar(2024)
• PG&E: Rising Tree II Wind (2024)
• This portfolio totals 750 MW Solar, 282 MW Battery Storage, & 198 MW Wind Attachment Staff Report Item 15D
Sonrisa Solar + Storage Project Details
6 • Contract for 200 MW solar / 184 MW 4-hour BESS
• Up to a 20-year Delivery Term
• Will be sited “across the street” from Ava’s Scarlet 1 project in Fresno County • Guaranteed Commercial Operation Date is June 30, 2027, but targeting completion by 12/31/26 to secure the expiring CA property tax exemption
• Deal secures a project that is safe-harbored against changes in renewable energy policy • Contract price includes an adjustment mechanism to share tariff costs levied at the time of major material delivery to the USA
– Similar adjustment in the amendment to Intersect Aramis, approved by the Board in June 2025 – Allowable adjustments will include a price cap for Ava • EDP has committed to using union labor for construction of the Sonrisa Project • The 184 MW 4-hour BESS will be contracted into a separate agreement at a future date with Sonrisa BESS LLC, and this PPA will be amended to reflect the change Attachment Staff Report Item 15D
Scarlet III Project Details
7 • Project is 70 MW / 280 MWh of 4-hour battery storage at the Scarlet I site in Fresno County • Combined Scarlet I and Scarlet III projects will be 100 MW solar + 100 MW / 4-hr BESS (up from 30 MW BESS), with a term ending in May 2044
• Guaranteed Commercial Operation Date of battery expansion is June 30, 2027; but targeting COD by 12/31/26 to secure the expiring CA property tax exemption • Deal secures a project that is safe-harbored against changes in renewable energy policy • Contract price includes an adjustment mechanism to share tariff costs levied at the time of major material delivery to the USA
– Similar structure to Intersect Aramis, approved by the Board in June 2025 – Allowable adjustments will include a price cap for Ava. • EDP has committed to using union labor for the construction of the Scarlet III Project • An Amendment to the Scarlet I PPA is needed to account for the BESS expansion • The existing Scarlet III RA-Only agreement will be terminated Attachment Staff Report Item 15D
Appendix
8 Attachment Staff Report Item 15D

Jessica Guadalupe Tovar
339 15th St Suite 208
Oakland, CA 94612
[email protected]
415-766-7766
Subject: Feedback on Ava Community Energy’s Local Development Business Plan Roadmap July 14, 2025
Dear Ava Community Energy Board, Community Advisory Committee and Alternates, The Local Clean Energy Alliance appreciates the effort that staff have put into developing the Local Development Business Plan (LDBP) and forthcoming strategic roadmap. However, we, along with many other community organizations, are deeply concerned by the limited scope, structure, and ambition of the current approach.

This roadmap narrows the focus of the LDBP to customer programming and electrification, at the expense of its broader goals of investment—particularly those related to energy supply. When the LDBP was first adopted, it envisioned community-driven, distributed energy resources and investments in local clean energy supply in addition to programs and projects that make transition accessible. This updated roadmap appears to abandon that original commitment by the agency. Why is Ava Community Energy not including commodity supply in this plan? Why has the focus on energy supply been dropped?
Electrification can and should be a powerful tool for local development. Furthermore, electrification will increase the need for power, but also ignores that other prerequisites like demand and energy efficiency should precede electrification. Following suggestions in the July 2018 Final LDBP, Ava Community Energy could invest in increasing local solar electricity, to offset increased demand from electrification. This would also provide a more resilient source of electricity than dependence on rising costs of long distance transmission lines that are consistently mismanaged and have caused catastrophic mega wildfires. Locally produced energy would help address the utility affordability issue that Ava Community Energy is currently grappling with by being dependent on contracting remote sources of energy.

We are also concerned how the roadmap completely has not addressed growing and urgent political threats on the state and federal levels. Rising rates imposed by PG&E and the CPUC on CCA customers, and Trump slashing renewable energy funding undermine Ava Community Energy’s ability to deliver cost savings and community benefits.

What political strategies is Ava Community Energy pursuing to push back? Why is there no mention of ratepayer advocacy, legislative resistance, or even litigation to protect clean renewable community energy? Another troubling aspect is the roadmap’s timeline and process. Community engagement is at the final stages of the plan, rather than being included throughout the process. This contradicts Ava Community Energy’s stated commitment to building trust and centering community input. Delaying authentic community participation only reinforces mistrust in Ava Community Energy. We ask that community co-governance, education, and input be integrated from the beginning—not as an afterthought.

We urge Ava Community Energy to commit to a Local Development Business Plan that is not only more expansive, but also financially resilient and ambitious. Is there a strategy to grow the LDBP even in the face of state and federal uncertainty?
The climate crisis is accelerating, and the stakes are higher than ever. What we need is to be bold, audacious, and forward-looking, and therefore we should build off of the visionary roadmap we started. The political, economic, and energy landscapes have changed dramatically since the original Local Development Business Plan was developed. In this moment, we need community investments that meet the scale of the challenge and include:
● Recommitment to developing local energy supply and distributed energy resources, ● An aggressive political strategy to challenge PG&E and CPUC rate hikes & other impacts, ● Full integration of community voices from the earliest phases of planning, ● Programs beyond electrification, such as local solar installations, energy efficiency, green workforce initiatives, and seed funding for innovation,
● A strategy to secure financial stability beyond ratepayer dependence, ● A commitment to local development of family-sustaining wage and union jobs.

We urge you to revise the roadmap accordingly and recommit to the transformative vision of the Local Development Business Plan. The communities you serve—and the future of community energy—deserve nothing less.

Clean Power to the People,
Jessica Guadalupe Tovar, Local Clean Energy Alliance
Adrian Bankhead <[email protected]>
public comment for CAC and Board Meetings
Audrey Ichinose <[email protected]> Mon, Jul 14, 2025 at 4:35 PM To: Adrian Bankhead <[email protected]>
Cc: Ayla Paz <[email protected]>, Jessica Tovar <[email protected]> Dear Adrian,
Can you please distribute this comment to CAC, Board of Directors, and Staff? I hope I am not too late on this.

Thanks!!
Audrey Ichinose
July 14, 2025
From: Audrey Ichinose, People’s Clean Power Alliance and the California Alliance for Community Energy (CACE)
To: Board of Directors, CAC members, Staff of Ava Community Energy Re: LDBP Strategic Roadmap Overview
As an early advocate for community energy in general and of Ava Community Energy, in particular, I want to express my great appreciation for this effort to determine next steps in the further implementation of the LDBP and customer programs. This effort speaks so well of the Staff’s goodwill, commitment and diligence in carrying out our CCA’s mission. So thank you, and let’s keep it going in spite of the outrageous obstacles being thrown in our way.

At the same time, I’d like to draw attention to a gap that’s beginning to open up between the LDBP, adopted in 2018, and the fluid, innovative clean energy world we know today. No example of this gap can be better--or more humorously--captured than what was in store for the fans at Sunday’s NASCAR stock car races in Sonoma. NASCAR officials were planning to stage a demonstration run of a prototype EV race car! While they have not yet scheduled any real races with this new type of car, they intended to seriously promote it as a product of the future. Though some might miss the noise, smoke, and even crashes of the old stock cars, who cannot fail to delight in a vehicle that accelerates at the push of a button bearing a rocketship logo! The future of DER and clean energy is undeniably here, and the need to update aspects of the LDBP is signaled by the fact that “Microgrids” does not appear in the Powerpoint charts. “VPPs” (Virtual Power Plants) may come the closest, but it does not accurately capture how solar+storage can be routinely shared on a small scale by small communities or congregants in Resilience Hubs. In addition, VPP’s miss the foundational idea of people taking a hand in generating their own electricity, thereby better controlling 7/15/25, 12:52 PM Ava Community Energy Mail - public comment for CAC and Board Meetings https://mail.google.com/mail/u/0/?ik=703fa6ea73&view=pt&search=all&permmsgid=msg-f:1837667313142127153&simpl=msg-f:1837667313142127153 1/2 their household costs and protecting themselves against the escalating hazards of a warming climate.

An adjunct to consider here are electric school buses, which can be used as mobile microgrids. Like near perfect puzzle pieces, electric school buses fit so well into the unused slots of daily electrical charging and of timely discharging, in and around their transportation function. Needless to say, the buses could generate significant savings for all communities, reduce waste and inefficiencies, and because of their mobility, serve as backup for power losses wherever they occur. I hope that Ava Community Energy can develop a comprehensive plan so that all of its communities, especially the small, can benefit from these mobile microgrids.

Thank you very much.
7/15/25, 12:52 PM Ava Community Energy Mail - public comment for CAC and Board Meetings https://mail.google.com/mail/u/0/?ik=703fa6ea73&view=pt&search=all&permmsgid=msg-f:1837667313142127153&simpl=msg-f:1837667313142127153 2/2 Thoughts on a Strategic Road Map for Ava Community Energy Jim Lutz ([email protected]) , July 15, 2025
The following are some issues regarding a strategic road map for Ava Community Energy I thought would be important to bring to the attention of the Board and CAC.

First I want to acknowledge all the good work Ava has done and is doing. Ava is providing reliable, reasonably priced and reasonably clean energy to ~650k customers. Ava has a solid financial reputation and a $1 billion/year revenue stream. Also, I would like to appreciate the local development road map process presented tonight.

Unfortunately I fear these strengths may not be enough. As I see it, there two major long term forces that are going to rip Ava apart if it continues on its current path.

The first trend is the amazing decline over the past couple decades in prices of solar, wind, and batteries.

See Bill McKibben's recent article in the New Yorker magazine, subtitled "In the past two years, without much notice, solar power has begun to truly transform the world’s energy system". This is good news regarding climate change and should be good news for everyone.1 Worldwide solar photovoltaic costs have fallen by 90% in the last decade, onshore wind by 70%, and batteries by more than 90%.2 Note, I'm citing worldwide costs here, not just because two deep water ports are in Ava's territory, but also because solar prices in California and the US are currently so distorted.

Even though this decline in solar, wind, and battery prices is a good thing, ironically it is bad for Ava for two reasons.

As costs of procuring energy continue to decline Ava's long term energy contracts will look more and more like a bad idea. At some point they will become an economically dangerous burden.

The other longer term reason this is bad for Ava is because at some point, the costs for solar and storage will have dropped so much customers will start to defect from the grid. It will be cheaper for them to install solar and storage than to keep paying rising electricity costs. And unlike in PG&E's case, no one's going to impose Power Charge Indifference Adjustments (PCIAs) on those departing customers to protect CCAs.

The other major force is PG&E itself.

PG&E delivers Ava's product to its customers and passes the money paid for that product back to Ava. Although many good people work and have worked there, PG&E is not a friend of CCAs.

PG&E (and the other IOUs in CA) have a history of opposing CCAs going back to before they even existed. In 2007 when Central Valley cities worked to form what would have been the first CCA, PG&E was there to foment obstruction. This was repeated in San Francisco and Marin County. 1 Bill McKibben, 4.6 Billion Years On, the Sun Is Having a Moment: In the past two years, without much notice, solar power has begun to truly transform the world’s energy system. July 9, 2025, The New Yorker. https://www.newyorker.com/news/annals-of-a-warming-planet/46-billion-years-on-the-sun-is-having-a-moment 2 Hannah Ritchie, Solar panel prices have fallen by around 20% every time global capacity doubled.

June 12, 2024 https://ourworldindata.org/data-insights/solar-panel-prices-have-fallen-by-around-20-every-time-global-capacity-doubled They have sponsored petition campaigns and legislation to cripple CCAs.3 Before this current
attempt they've already had the PCIA rates changed a couple times.4 5 They centralized Resource Adequacy (RA) purchasing decisions away from CCAs. Other related and harmful decisions not directly attacking the CCAs have been the requirements for complete IOU control ofmicrogrids and tariff changes against rooftop solar. There is no reason to expect this pattern to change.

PG&E is a convicted felon that has caused the death of over a hundred people since 2010.6 It has gone bankrupt twice. In 2001 following the Enron debacle and after the Paradise fire in 2021. If PG&E doesn't like a law or regulation, it can usually arrange to have that law or regulation changed.

It, along with the two other large IOUs in California have completely captured the PUC, the agency that is supposed to regulate utilities. They also have undue influence over governor Newsom. Just one example is how he played fast and loose with the legislative process the last time PG&E was bailed out of bankruptcy. PG&E came out of that with no meaningful liability to the victims of the Paradise fire and were even given a contingent future license to burn.

Historically PG&E's profits, which are 10-12% on all projects such as new transmission lines, have exceeded stock market returns and for the past several years their electricity rates have been three times higher than inflation.7 A majority PG&E's stockholders are now private equity firms.

The price gouging is only going to continue. There is no indication that PG&E intends to stop raising rates. This hurts Ava's customers directly. And the rising electricity rates also damage Ava's reputation among its customers.

These two trends are why I say that unless something changes, sooner or later, Ava will be destroyed.

However I don't think this has to happen.

My partner has a black-belt in Aikido. The guiding philosophy of that martial art is to use one's opponent's strength against them. PG&E's greatest strength is its ability to raise regulated electricity prices. Using that strength has caused it to be one of the most reviled corporations in California.

That revulsion has created a diffuse but strong political force that could be tapped for the benefit of CCA's.

And there's another force that could potentially be tapped to expand Ava's opportunities and impact.

Here I'm referring to the amazing people and organizations that came together in the twenty teens to get Ava started. Broadly stated the goal was for EBCE, now Ava, to bring the benefits of cheap, clean, local energy to its customers.
3 Steven Weissman and Harry Moren, California’s Proposition 16 June 2010 Primary: An Analysis, May 2010, Center for Law, Energy & the Environment, School of Law, University of California, Berkeley, https://www.localcleanenergy.org/files/CLEEsProp16WhitePaper.pdf 4 Power Charge Indifference Adjustment (PCIA)
https://www.cpuc.ca.gov/industries-and-topics/electrical-energy/electric-power-procurement/power-charge-indifference-adjustment 5 Roy L Hales, California’s “Monopoly Protection Act,” AB 2145, Is Dead, 2014, https://cleantechnica.com/2014/09/04/californias-monopoly-protection-bill-ab-2145-dead/ 6 Brandon Rittiman, PG&E disasters killed 117 people last decade, January 2, 2020, https://www.abc10.com/article/news/local/wildfire/pge-disasters-killed-117-people-last-decade/103-3ca212b6- c502-4b7f-948e-ad6e73bf55a3
7 , It’s not you, it’s them - PG&E rates rising three times faster than inflation, June 18, 2024, https://www.publicpowersf.org/en/blogposts/its-not-you-its-them-pgampe-rates-rising-three-times-faster-than-inflation The reason I say this is only a potential force, is because those people and organizations are not overly enthusiastic about what Ava has been doing. In addition to providing cheap, clean, local energy, they expected to see Ava upgrading and electrifying all the buildings and transportation in its territory while bringing benefits to its customers starting with the most disadvantaged ones first.

Oh, and those with the well know trends in solar, wind and batteries I mentioned earlier, they're expecting next year's electricity rates to be lower than this year's and the following year's rates even lower.

I don't know how Ava could take advantage of those potential forces, although I do have some ideas.

First, although it will be difficult, to survive Ava must become bold and audacious. Given the trends I mentioned at the beginning of my talk I really don't see other option. That means starting with the community Ava serves. Those people and organizations are the reason Ava exists. Please involve them early and deeply in all strategic plan development processes.

Another thing is to become an energy provider that does more than just push electricity through PG&E's wires. I have not sure what the best way is to do this is. Maybe it involves using Ava's good credit rating to leverage financing for its customers so that they can get solar and storage, possibly up to the level they could defect from the grid. Maybe it involves changing the regulatory barriers and restrictions that PG&E and its CPUC have managed to put in place. Providing resources to the type of community organizations that got Ava started could be an effective way to start that process.

Convincing and leading the other CCAs around the state to be more assertive about defending their customer interests is certainly something Ava should be doing. The same goes for collaborating with Ava's member cities and counties.

A road map process is very good way to start conceptualizing and developing the types of change that Ava needs to survive and possibly even thrive. Because of these forces, now is not the time to focus solely on core programmatic initiatives.

Ava Community Energy Board of DirectorsJuly 16, 2025

Ava Community Energy Board of Directors
July 16, 2025