Board of Directors of the
Clean Power Alliance of Southern California
Regular Meeting
Thursday, September 4, 2025
2:00 p.m.
Visit CPA’s YouTube Channel to view a Live Stream of the Meeting www.youtube.com/@CPApublicmeetings
*There may be a streaming delay of up to 90 seconds. This is a view-only live stream.
Clean Power Alliance
Diana Mahmud Board Room
801 S. Grand Ave., Suite 400
Los Angeles, CA 90017
Members of the public may also participate in this meeting at the following locations:
Calabasas City Hall
Council Conference Room
100 Civic Center Way
Calabasas, CA 91301
Ventura County Government Center
Point Mugu Conference Room, 4th Floor
Hall of Administration
800 South Victoria Avenue
Ventura, CA 93009
Whittier City Hall
Admin Conference Room
13230 Penn Street
Whittier, CA 90602
South Bay Cities Council of Governments
Conference Room
357 Van Ness Way, Suite 90
Torrance, CA 90501
Hotel Dolce Vita Resort
3rd Floor Conference Room
43 Avenue Mwungo
Bujumbura, Burundi
City of Claremont
City Yard/Community Services Department
Conference Room
1616 Monte Vista Avenue
Claremont, CA 91711
PUBLIC COMMENT: Members of the public may submit their comments by one of the following options:
• Email Public Comment: Members of the public are encouraged to submit written comments on any agenda item to [email protected] up to four hours before the meeting. Written public comments will be announced at the meeting and become part of the meeting record. Public comments received in writing will not be read aloud at the meeting. • Provide Public Comment During the Meeting: The General Public Comment item is reserved for persons wishing to address the Board on any Clean Power Alliance-related matters not on today’s agenda. Public comments on matters on today’s Consent Agenda and Regular Agenda shall be heard at the time the matter is called. Comments on items on the Consent Agenda are consolidated into one public comment period. Members of the public who wish to address the Board at CPA’s Office are requested to complete a comment card and provide it to staff. If you are attending from a remote location, please identify yourself to a CPA representative when your item is called.
Agenda Page 1
Each speaker is limited to two (2) minutes (in whole-minute increments) per agenda item with a cumulative total of five 5 minutes to be allocated between the General Public Comment, the entire Consent Agenda, or individual items in the Regular Agenda. Please refer to Policy No. 8 – Public Comment for additional information.
NAVIGATING OUR AGENDA PACKETS: The meeting agenda packets are bookmarked PDFs, which display a list of agenda items to the left of the page and allow you to click to view specific items within the packet. If viewing in your browser, click the "document outline" button in the upper left corner of the screen.
If the PDF is downloaded, the bookmark panel (ribbon icon) appears on the left side of the screen.
ACCESSIBILITY: 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 two (2) working days before the meeting at [email protected] or (213) 713- 5995. Notification in advance of the meeting, while not required, will enable us to make reasonable arrangements to ensure accessibility to this meeting and the materials related to it.
CALL TO ORDER AND PLEDGE OF ALLEGIANCE
ROLL CALL
GENERAL PUBLIC COMMENT
CONSENT AGENDA
1. Approve Minutes from the July 10, 2025, Board of Directors Meeting
2. Approve and Authorize the Chief Executive Officer to Execute the Memorandum of Understanding with the County of Los Angeles to receive up to $964,800 of Grant Funds from the California Energy Commission’s Equitable Building Decarbonization Direct Install Program through December 31, 2029
3. Approve and Authorize the Chief Executive Officer to Execute the Amendments to the Renewable Power Purchase Agreements with Solar Star 3, LLC and Solar Star 4, LLC, for the Solar Star Solar and Battery Energy Storage System Projects
4. Approve and Authorize the Chief Executive Officer to Execute the Professional Services Agreement with Yes Energy for Settlement Software, Cloud Hosting Services, Operational Support and Maintenance, and Implementation for a One-Year Initial Term with Two Optional Successive One-Year Terms for a Total Contract Value of up to $976,874
5. Receive and File Conflict of Interest Code Update
6. Receive and File Annual Electricity Usage by Jurisdiction
7. Receive and File Q2 Risk Management Team Report
8. Receive and File Q3 Communications Report
9. Receive and File Q3 Member Agency Programs Report
Agenda Page 2
10.Receive and File September 2025 Bill Positions Report
11.Receive and File Monthly Community Advisory Committee Report
REGULAR AGENDA
Action Items
12.Approve and Authorize the Chief Executive Officer to Execute Two 15-Year Renewable Power Purchase Agreements with SunZia Wind North LLC for 37.3 MW and with SunZia Wind South LLC for 87.7 MW for a Combined Total of 125 MW of Incremental Capacity
13. (A) Adopt Resolution 25-09-092 Authorizing the Offer of Membership to the Cities of Cudahy and Fillmore to Join CPA with Service to Customers to Begin in 2027 or the Year Specified by the California Public Utilities Commission in its Approval of CPA’s Addendum to its Implementation Plan, if Later than 2027; and, (B) Direct Staff to Prepare an Implementation Plan Addendum and any Related Documents as Required by the CPUC for Consideration by the Board of Directors at a Public Hearing at the December 4, 2025, Meeting
Information Item
14.Receive Presentation on CPA’s TOU-SMART Rate and Provide Feedback on a Proposed Pilot Program
COMMITTEE CHAIR UPDATES
Director Cedric Hicks, Chair, Legislative & Regulatory Committee Director Susan Santangelo, Chair, Finance Committee
Director Robert Parkhurst, Chair, Energy Planning & Resources Committee
MANAGEMENT REPORT
BOARD MEMBER COMMENTS
REPORT FROM THE CHAIR
ADJOURN – NEXT REGULAR MEETING OCTOBER 16, 2025
*Note this October meeting date is outside of CPA’s usual monthly cadence.
Public Records: Public records that relate to any item on the open session agenda for a regular Board Meeting are available for public inspection. Those records that are distributed less than 72 hours prior to the meeting are available for public inspection at the same time they are distributed to all, or a majority of, the members of the Board. Public records are available for inspection at CPA’s Office at 801 S. Grand Ave., Suite 400, Los Angeles, CA 90017, or online at www.cleanpoweralliance.org/agendas.
Agenda Page 3
Commonly Used Acronyms
BESS Battery Energy Storage System
CAC Community Advisory Committee
CAISO California Independent System Operator
CALCCA California Community Choice Association
CalEVIP California Electric Vehicle Incentive Program
CARB California Air Resources Board
CARE California Alternate Rates for Energy (Low Income Discount Rate) CCA Community Choice Aggregation
CEC California Energy Commission
CPUC California Public Utilities Commission
DA Direct Access (Private Retail Energy Supplier)
DAC Disadvantaged Community (As Defined by Calenviroscreen 3.0) DER Distributed Energy Resources
DR Demand Response
ERMP Energy Risk Management Policy
ERRA Energy Resource Recovery Account (SCE Generation Rate Setting)
ESA Energy Storage Agreement
EVSE Electric Vehicle Supply Equipment (EV Charger)
FERA Family Electric Rate Assistance (Low Income Discount Rate) GHG Greenhouse Gas
IOU Investor Owned Utility
IRP Integrated Resource Plan
JPA Joint Powers Authority
Agenda Page 4
Commonly Used Acronyms
Kwh Kilowatt-Hour (A Measure of Energy Used in A One-Hour Period) Kw Kilowatt = 1,000 Watts (Watt = A Measure of Instantaneous Power) LSE Load Serving Entity
MB Medical Baseline (Discount Rate for Medical Equipment Needs) MW Megawatt = 1,000 Kilowatts
Mwh Megawatt-Hour = 1,000 Kilowatt-Hours
NEM Net Energy Metering (Usually for Customers with Solar) OAT Other Applicable Tariffs
PCIA Power Charge Indifference Adjustment (Can Be Called “Exit Fee”) PCC1 Renewable Energy Generated Inside California
PCC2 Renewable Energy Generated Outside California
PCC3 A REC from A Renewable Resource, Delivered Without Energy PCL Power Content Label
POU Publicly Owned or Municipal Utility
PPA Power Purchase Agreement
PSPS Public Safety Power Shutoff
PV Photovoltaic (Solar) Panels
RA Resource Adequacy
REC Renewable Energy Credit
RPS Renewables Portfolio Standard
T&D Transmission and Distribution
TOU Time Of Use (Used to Refer to Rates that Differ by Time Of Day) WECC Western Electricity Coordinating Council
Agenda Page 5
Staff Report – Agenda Item 1
To: Board of Directors
Subject: Approve Minutes from the July 10, 2025, Board of Directors Meeting
Date: September 4, 2025
RECOMMENDATION
Approve.
ATTACHMENT
1. Minutes
Agenda Page 6
Board of Directors Item 1
MINUTES
Board of Directors of the
Clean Power Alliance of Southern California
Regular Meeting
Thursday, July 10, 2025, 2:00 p.m.
Meeting videos are available on CPA's YouTube Channel.
http://www.youtube.com/@CPApublicmeetings
Board members participated from the following locations:
Calabasas City Hall
Council Conference Room
100 Civic Center Way
Calabasas, CA 91301
Clean Power Alliance
Diana Mahmud Board Room
801 S. Grand Ave., Suite 400
Los Angeles, CA 90017
City of Claremont
City Yard/Community Services Department
Conference Room
1616 Monte Vista Avenue
Claremont, CA 91711
Ventura County Government Center
Point Mugu Conference Room, 4th Floor
Hall of Administration
800 South Victoria Avenue
Ventura, CA 93009
South Bay Cities Council of Governments
Conference Room
357 Van Ness Way, Suite 110
Torrance, CA 90501
Whittier City Hall
Admin Conference Room
13230 Penn Street
Whittier, CA 90602
Alhambra City Hall
Conference Room A
111 S. First St.
Alhambra, CA 91801
Camarillo City Hall
Administrative Conference Room
601 Carmen Drive
Camarillo, CA 93010
La Cañada Flintridge City Hall
Rose Conference Room
One Civic Center Drive
La Cañada Flintridge, CA 91011
Moorpark City Hall
Executive Conference Room
323 Science Dr.
Moorpark, CA 93021
Hermosa Beach City Hall
Conference Room, 2nd Floor
1315 Valley Drive
Hermosa Beach, CA 90254
Beverly Hills City Hall
Conference Room, 4th Floor
455 N. Rexford Drive
Beverly Hills, CA 90210
Carson City Hall
Executive Conference Room
701 E. Carson St.
Carson, CA 90745
Courtyard Roseville Galleria Mall
Creekside Boardroom
301 Creekside Ridge Court
Roseville, CA 95678
Hyatt Regency Chicago
Gallery 4 Boardroom
West Tower, Skyway Level
151 East Wacker Drive
Chicago, IL 60601
Agenda Page 7
Board of Directors Item 1
CALL TO ORDER & ROLL CALL
Chair Klein Lopez called the meeting to order at 2:02 p.m. and Gabriela Monzon, Clerk of the Board, conducted roll call.
PLEDGE OF ALLEGIANCE
Director Albrecht led the Pledge of Allegiance.
Roll Call
1 Agoura Hills Deborah Klein Lopez Chair Remote
2 Alhambra Jeff Maloney Director Present
3 Arcadia Absent
4 Beverly Hills Julian Gold Alternate Remote
5 Calabasas Ed Albrecht
David Shapiro
Director
Alternate Remote
6 Camarillo Susan Santangelo Director Remote
7 Carson Cedric Hicks Director Remote
8 Claremont Jeremy Swan Alternate Remote
9 Culver City Joe Susca Alternate Remote
10 Downey Absent
11 Hawaiian Gardens Ramie L. Torres Alternate Remote
12 Hawthorne Alex Monteiro Director Present
13 Hermosa Beach Doug Krauss Alternate Remote
14 La Cañada Flintridge Stephanie Fossan Director Remote 15 Los Angeles County Rita Kampalath Alternate Present
16 Lynwood Juan Muñoz-Guevara Director Remote
17 Malibu Absent
18 Manhattan Beach Absent
19 Monrovia Edward Belden Director Present
20 Moorpark Rene Delgado Alternate Remote
21 Ojai Absent
22 Oxnard Bert Perello Director Remote
23 Paramount Michelle Muller Alternate Remote
24 Port Hueneme Jess Lopez Alternate Remote
Agenda Page 8
Board of Directors Item 1
25 Redondo Beach Absent
26 Rolling Hills Estates Debby Stegura Director Remote
27 Santa Monica Gleam Davis Alternate Present
28 Santa Paula Absent
29 Sierra Madre Robert Parkhurst Director Present
30 Simi Valley Rocky Rhodes Director Remote
31 South Pasadena Omari Ferguson Director Present
32 Temple City Ed Chen Director Present
33 Thousand Oaks David Newman Director Remote
34 City of Ventura Absent
35 Ventura County Vianey Lopez Vice Chair Remote
36 West Hollywood Chelsea Byers Alternate Remote
37 Westlake Village Kristopher Galvez Alternate Remote
38 Whittier Mary Ann Pacheco Director Remote
All votes are unanimous unless otherwise stated.
GENERAL PUBLIC COMMENT
There was no public comment.
CONSENT AGENDA
1. Approve Minutes from the June 5, 2025, Board of Directors Meeting
2. Adopt Resolution No. 25-07-090 Approving the Load Management Standard Revised Compliance Plan Wherein CPA Proposes to Participate in Southern California Edison’s Expanded Dynamic Rate Pilot to Meet the California Energy Commission’s Load Management Standards Regulatory Requirements
3. Adopt Resolution No. 25-07-091 to Approve Proposed Energy Risk Management Policy Amendments
4. Approve and Authorize the Chief Executive Officer to Execute a Professional Services Agreement with Tenaska Power Services for Scheduling Coordinator Services, Congestion Revenue Right Services, Credit Risk Management, Risk Management, Load Forecasting, and Energy Storage Optimization Services for a Three-Year Initial Term with Two Optional Successive One-Year Terms for a Total Not to Exceed Amount of $7.55 Million for the Total 5 Year Term
5. Approve and Authorize the Chief Executive Officer to Execute Amendment No. 2 to Increase the Contract Value of the Professional Services Agreement with Pastilla, Inc. by $833,608 for a total Not to Exceed Amount of $1.85 Million in FY 2025/26 for Creative Services, Web Development, and Web Maintenance
6. Approve and Authorize the Chief Executive Officer to Execute Amendment No. 3 to the Professional Services Agreement with Bloom Ads Global Media Group to Increase the Contract Value by $596,327 for a total Not to Exceed Amount of $2,655,327 in FY 2025/26 for Media Buying and Related Services
Agenda Page 9
Board of Directors Item 1
7. Approve Amendment to the Renewable Power Purchase Agreement with ESCA-PLD-SOUTHBAY2, LLC (“Prologis”) for the South Bay 6 Local Rooftop Solar Project and Authorize the Chief Executive Officer to Execute the Amendment Resulting in a Payment to CPA in the Amount of $227,700 and an Extension of the Commercial Online Date to May 30, 2026
8. Receive and File July 2025 Bill Positions Report
9. Receive and File Monthly Community Advisory Committee Report Motion: Director Rhodes, Simi Valley
Second: Director Parkhurst, Sierra Madre
Vote: The consent agenda was approved by roll call vote.
COMMITTEE CHAIR UPDATES
Director Hicks, Chair of the Legislative & Regulatory Committee, reported that at its June meeting, the Committee directed staff to send a letter to the CPUC requesting that CPA customers be eligible for the Self-Generation Incentive Program, regardless of enrollment status in a qualified demand response program. Staff is in communication with the CPUC to resolve the matter favorably. Director Hicks also reported that despite strong opposition, language in AB 306 passed in a separate bill (AB130), making reach codes more challenging to implement. Ted Bardacke, Chief Executive Officer, explained that approximately 12 CPA member agencies are working with staff and outside consultants to adopt reach codes before the October 1, 2025, deadline.
Director Santangelo, Chair of the Finance Committee, reported that the Committee reviewed and approved the proposed minimum hedge percentage related to the amendments to the Energy Risk Management Policy (ERMP).
Director Parkhurst, Chair of the Energy Planning & Resources Committee, reported that the Committee approved negotiations with the SunZia project for an additional 125 MW of power. The Committee also recommended that the Board approve suggested amendments to the ERMP.
MANAGEMENT REPORT
Mr. Bardacke discussed the effects of the 2025 Federal Tax and Spending Bill on clean energy and CPA, including PPAs and ESAs, customer programs, and federal and state direct customer incentives. Mr. Bardacke stated that all of CPA’s current utility-scale wind and solar plus storage projects are operational or have started construction and therefore are substantially derisked. Half of CPA’s current utility-scale unbuilt stand-alone storage projects could meet July 3, 2026, construction start date deadlines, while others are in earlier stages of development. Tariff impacts, separate from the tax bill, will remain unpredictable.
Regarding impacts to customer programs, Mr. Bardacke discussed the Power Ready, Power Share, and Solar and Battery Access programs. Workforce Development program funding could be reduced over the medium term if fewer PPAs were signed. Many direct federal customer incentives will rapidly sunset. CPA’s Sun Storage, Building Electrification, and EV Programs could face reduced demand next year due to higher consumer costs.
Agenda Page 10
Board of Directors Item 1
Director Belden asked whether CPA would have trouble attracting new customers because of the stress on the green energy industry, and staff responded by stating the agency is well-resourced for the next several years. Director Barrett asked about future energy purchases and other CPA responses to the federal actions. Mr. Bardacke provided information about active RFOs, risk reduction, and adjustments to the pricing and bidding structure.
Staff clarified for Director Gold the storage projects may face challenges in the future due to Foreign Entity of Concern (FEOC) restrictions or other development issues. Director Gold also asked how rebuilding after the January wildfires would be affected by the new federal changes, and staff said incentives and funding, rather than regulation, would help a green rebuild. Mr. Bardacke added that CPA is focusing on restructuring the Power Ready Program that may make it more nimble to address government buildings and schools in the fire impacted areas, as well as across CPA’s service territory.
BOARD MEMBER COMMENTS
Director Rhodes complimented Matt Langer, Chief Operating Officer, for his ability to explain complex technical issues related to CPA’s operations and power contracts.
REPORT FROM THE CHAIR
None.
ADJOURN
Acting Chair Parkhurst adjourned the meeting at 2:58 p.m.
Agenda Page 11
Staff Report – Agenda Item 2
To: Board of Directors
From: John Spector, Program Manager, Resiliency Programs and Grants Reviewed by: Joanne O’Neil, Sr. Director, Customer Programs Matthew Langer, Chief Operating Officer
Francis Choi, Assistant General Counsel
Approved By: Ted Bardacke, Chief Executive Officer
Subject: Equitable Building Decarbonization Grant Funding Agreement Date: September 4, 2025
RECOMMENDATION
Approve and authorize the Chief Executive Officer to execute the Memorandum of Understanding (MOU) with the County of Los Angeles (LA County) to receive up to $964,800 of grant funds from the California Energy Commission’s (CEC) Equitable Building Decarbonization Direct Install Program (EBD Program) through December 31, 2029.
BACKGROUND/DISCUSSION
CPA is a member of a coalition led by LA County’s Internal Services Department that was awarded funding from the CEC to implement the statewide California EBD Program for the Southern California region, which includes CPA service territory in LA County.
Funding for the Central region, which includes CPA service territory in Ventura County, was awarded to the Center for Sustainable Energy (CSE). CPA does not have a formal role in the CSE-led efforts but plans to engage with CSE to promote participation from CPA customers in Ventura County.
Agenda Page 12
Board of Directors Item 2
The EBD Program will accelerate residential building decarbonization for income-qualified residential customers in single-family homes, multi-family properties, manufactured housing, and public housing in disadvantaged communities through the free installation of electrification and energy efficiency upgrades. The EBD Program provides energy efficiency measures such as heat pumps and thermostats, enhancing existing space heating and cooling equipment through testing and duct-sealing; building envelope upgrades such as installing insulation; electrification upgrades such as installing heat pump water heaters, induction stoves and electric dryers. Additional support measures include retrofitting electric panels and safety enhancements. The EBD Program’s goal is to support 5,800 participants throughout LA County, a subset of which will be CPA customers.
Under the MOU, CPA will serve as a grantee and subcontractor to LA County and implement the marketing plan approved by LA County and the CEC. CPA will be responsible for conducting tailored and culturally relevant marketing, engagement, and outreach (ME&O) activities to inform and engage CPA customers in qualifying communities about the EBD Program, its benefits, and ultimately refer participants to the LA County implementation team to receive the upgrades. CPA will invoice LA County for staff time and marketing materials needed to achieve the scope of the MOU.
The EBD Program is funded by the California General Fund and the California Greenhouse Gas Reduction fund. While portions of the EBD Program receive funding from the Federal Homeowner Managing Energy Savings Rebate Program (HOMES), no portion of CPA’s funding comes from HOMES or any other federal funding source.
DISCUSSION
CPA’s participation in the EBD Program is expected to increase the number of CPA customers who receive free energy efficiency guidance, electrification upgrades, and renewable energy generation technologies. The EBD Program will advance CPA’s goals to reduce greenhouse gas emissions, especially among populations disproportionately affected by air pollution and climate change.
Agenda Page 13
Board of Directors Item 2
Initially, CPA will target under-resourced communities whose residents are most likely to benefit from electricity bill savings, that are vulnerable to extreme heat, fire and other climate risks, and have high pollution burden. EBD Program communities will be identified and targeted based on the mutual determination by CPA, LA County, and the CEC. CPA specifically plans to market the opportunity to our low-income residents that are currently enrolled in rate assistance programs such as California Alternate Rates for Energy (CARE) and Family Electric Rate Assistance program (FERA) within target communities.
CPA will leverage its expertise and knowledge to implement a variety of outreach strategies to effectively reach the target audience. This may include community events to provide opportunities for direct engagement, print materials, digital campaigns utilizing social media, email newsletters, and community toolkits to disseminate information widely to residents online. CPA will utilize its geotargeting capabilities to promote the EBD Program while co-branding with the CEC and LA County. CPA will also translate marketing collateral and coordinate with community-based organizations as appropriate.
A new Senior Associate, Communications and Marketing role will be required to fulfill the grant activities, which will be fully funded by the grant and work alongside existing CPA staff who will also be reimbursed for a limited number of hours. Marketing materials supporting the grant will also be reimbursed.
The EBD Program will coordinate with existing and complementary programs to leverage all available incentives, rebates, tax credits and grant funding, including CPA’s many available residential programs. The EBD Program’s ME&O and implementation efforts align well with CPA’s existing residential program initiatives and can be co-branded to promote additional resources including Power Response and Sun Storage Rebate.
FISCAL IMPACT
Expenses and direct staffing time will be reimbursed through the EBD Program grant, as provided in the MOU. The Board-approved FY 2025/26 budget includes sufficient funding Agenda Page 14
Board of Directors Item 2
for any non-reimbursable costs. Costs for future years will be included in future budget proposals.
ATTACHMENT
1. Memorandum of Understanding Between the Los Angeles County Internal Services Department and Clean Power Alliance of Southern California, A Southern California Equitable Building Decarbonization Coalition Member Relating to Regional Partnerships for the Implementation of the California Energy Commission Equitable Building Decarbonization Direct Install Program Agenda Page 15
1 MEMORANDUM OF UNDERSTANDING BETWEEN
THE LOS ANGELES COUNTY INTERNAL SERVICES DEPARTMENT AND CLEAN POWER
ALLIANCE OF SOUTHERN CALIFORNIA, A SOUTHERN CALIFORNIA EQUITABLE BUILDING
DECARBONIZATION COALITION MEMBER
RELATING TO
REGIONAL PARTNERSHIPS FOR THE IMPLEMENTATION OF THE
CALIFORNIA ENERGY COMMISSION EQUITABLE BUILDING DECABONIZATION DIRECT
INSTALL PROGRAM
This Memorandum of Understanding ("MOU") is made and entered into as of the last date signed below ("Effective Date") by and between the County of Los Angeles ("County"), Internal Services Department ("ISD"), and Clean Power Alliance of Southern California (“CPA”), a member of the Southern California Equitable Building Decarbonization Coalition (“SoCal EBD Coalition”), who together are implementing the California Energy Commission’s (“CEC”) Equitable Building Decarbonization (“EBD”) Direct Install (“DI”) Program (“EBD DI Program”). The EBD DI Program will accelerate large-scale residential building decarbonization efforts underway in Southern California for single-family homes, multifamily properties, manufactured housing, and public housing in disadvantaged communities.
Specifically, CPA will be responsible for conducting tailored and culturally relevant Marketing, Education, and Outreach (“ME&O”) activities to inform and engage potential participants about EBD, the EBD DI Program, and its benefits. Activities will be informed by deep knowledge of the local needs, challenges, opportunities, and resources of communities, and delivered through established relationships.
I. PURPOSE
ISD, as the lead agency for implementation of the County's energy and environmental initiatives, is the recipient and administrator of the CEC EBD DI Program for the Southern California region. On November 6, 2024, the County Board of Supervisors approved the acceptance of the 2024-2029 grant award to accelerate large scale residential building decarbonization funded by the EBD DI Program. County received an award of $328,977,7401 from the CEC.
The approved grant budget by the CEC, for calendar years 2024-2029, will provide regional engagement, outreach, and implementation support for the CEC Southern California Equitable Building Decarbonization Direct Install Program. The County has requested assistance with general program design and support, program marketing, regional engagement support, energy planning, education and training, agency recognition, program motivation and competition, and identification of pilot activities.
Community-based Organizations (hereinafter “CBOs”) shall be guided in their work by program documents provided by County, as well as ongoing coordination with the designated County task lead.
1 Contingent upon USDOE HOMES approved funding.
Agenda Page 16
2 II.
Ill.
The purpose of the MOU is for CPA to assist with the implementation of the CEC’s EBD DI Program which seek to leverage their knowledge and perspective of their unique communities to increase the overall visibility and presence of projects, partnerships, and programs, generating new enrollments and registrations with communities and their members within their geographic region of influence, especially in hard to reach and disadvantaged communities; also, to support the program’s efforts related to project identification with prioritized communities within the respective region, and to coordinate and deliver education and training activities to enrolled communities and their members.
Finally, CPA will work with County to identify further potential strategies and activities to support the EBD DI Program and ensure all deliverables as it concerns their specific communities.
TERM OF MOU
This MOU shall be effective from the Effective Date through December 31, 2029, or until such time, or either County or CPA decides to terminate this MOU.
COMPENSATION FOR SERVICES
County shall pay CPA for its performance of services as described in the attached Scope of Work (Attachment A), and the payment shall constitute full and complete compensation for CPA’s services including, but not limited to, administration and administrative support, marketing, education, and outreach activities of the aforementioned program in CPA’s respective local community. Said compensation shall be paid by County out of its 2024-2029 allocation of CEC funds, for allowable costs to be incurred for the express purposes specified. The parties understand and agree that such payment shall be conditioned upon the allocation determined by the CEC of said funds to County. Said funds shall be paid in accordance with the budget, which shall be provided on a yearly basis by County, as established in the program agreement with the CEC. Any money received by CPA hereunder, and not incurred for costs pursuant hereto, and/or during the term of this MOU, shall be returned to County upon the expiration of the County’s fiscal year in which CPA incurred costs for the EBD DI Program. Under no circumstances shall County administer any funds obtained from Section 50121 of the Inflation Reduction Act, also known as the Home Owner Managing Energy Savings Rebate Program (“HOMES”), to CPA under this MOU without CPA’s prior written consent.
IV. INVOICING, REPORTING & PAYMENTS
County will receive monthly invoices from CPA (Attachment F: CEC Invoice Template) and shall review the invoices to ensure the following:
(1) That CPA activities are consistent with the Scope of Work (“SOW”) contained in Attachment A to this MOU; and
Agenda Page 17
3 (2) That sufficient budgetary authorization exists.
The following Invoicing, Reporting and Payment Requirements are applicable to the SOW:
(1) Time and Material Basis; Not to Exceed. All work will be performed on a time and material basis and subject to the general provisions set forth below.
General Provisions
(1) All charges shall be directly identifiable to, and required for, the authorized work or activity.
(2) CPA shall notify the County agent responsible for the MOU at such time that CPA reasonably ascertains that the forecasted cumulative charges may exceed any budgets authorized (whether by task, total amount authorized, or both) by either the County or CPA.
(3) Labor Related Costs Under Time and Material Basis. To the extent applicable, CPA shall invoice County, at the fixed hourly rates or monthly salary rates for the applicable labor categories, for the performance of the authorized work by the CPA's employees or agents as established in this MOU under the CPA’s respective budget form (Attachment B: Budget), as entered in the Direct Labor tab for rate caps. Such fixed hourly rates or monthly salary r ates shall be inclusive of all of the CPA's overhead costs (including all taxes and insurance), administrative and general fees. All labor related costs shall be charged at cost, without mark-up, and shall be necessary, reasonable, and ordinary. County will only reimburse for actual direct labor expenses incurred, not to exceed the rates specified in the MOU.
Rates must include dollars and cents.
(4) Expenses. All expenses shall be charged at cost, without mark-up, and shall be necessary, reasonable, and ordinary. Expenses shall also comply with federal, State, and County expense policies.
(5) Material and Miscellaneous Costs. Material and Miscellaneous Costs shall be substantiated with supporting documents and an invoice stating the unit price, quantity, and other information as required to identify the authorized work or activity. Materials are items under the agreement that do not meet the definition of Equipment and must be project-related. Food and drinks are not reimbursable expenses.
(6) Subcontract Costs and Subcontractors. Subcontracted work or activities shall be charged at the rates actually paid by CPA. CPA shall provide County with an additional invoice for any CPA invoice that includes CPA’s
Agenda Page 18
4 subcontractor costs. CPA shall at all times be responsible for the services or deliverables which are to be provided by CPA or its CPA’s subcontractors, and for the acts and omissions of CPA’s subcontractors and persons directly or indirectly engaged by the CPA’s subcontractors. All expenses shall be charged at cost, without mark-up and must follow the same labor related costs established by CEC guidelines.
(7) Travel Costs. All travel costs are reimbursed at state rates, subject to any state-wide prohibition on travel, except in agreements between the Energy Commission and a UC campus or the Federal Government. CPA will only receive reimbursement for travel costs for transportation (i.e. Flights, car rental, mileage, taxi) and lodging at state rates. All other travel related costs, such as meals and incidental expenditures, are not covered. CPA must obtain written pre-approval from County (and CEC, if required) for all travel listed on the agreement budget forms, in accordance with the CEC EBD DI Program Terms and Conditions (Attachment D) of this MOU. Approved air travel costs shall in no case exceed the cost of economy or coach fares where said fares are reasonably available. A copy of an airfare receipt indicating the final cost for the trip as well as applicable supporting documents showing the traveler's starting point, travel destination, departure and return, and the purpose of the trip are required for each air travel reimbursement. Automobile travel from the County agents or representatives’ office to any Program job site, function or activity shall be paid at applicable County travel expense rates and mileage. Either a mileage log showing miles driven for each trip or a Google Maps/ equivalent application printout showing the travel path shall be provided by CPA for each mileage reimbursement request. (8) Records. CPA shall maintain, for a period of five (5) years after final payment, complete accounting records (and supporting documentation) of all invoiced costs. The County reserves the right to audit and copy any applicable documents related to the CPA’s invoice, all costs and expenses invoiced, and task completion records. Each invoice shall list the number of the MOU covered by each such invoice.
(9) Key Personnel. CPA will appoint a representative who will be the primary contact between CPA and the County, and who will be authorized to act on behalf of the CPA. Such appointment shall be communicated in writing to County as soon as reasonably practicable, following the execution of this MOU. CPA shall promptly notify County of any intended reassignment or proposed replacement of the key personnel who will be submitting invoicing and reporting information to County.
(10) Activities Outside of Program Scope. County shall not be required to pay CPA for any activities undertaken by CPA that are outside of the SOW of this MOU, but that are otherwise invoiced by CPA.
Agenda Page 19
5 (11) Invoicing Requirements: CPA shall provide a monthly invoice to County within the 7th calendar day of every month for all reimbursable expenses incurred performing work under this MOU in compliance with the CEC EBD DI Program Terms and Conditions (Attachment D) for the prior month.
Invoices must separate and distinguish Marketing, Education, Outreach, Planning and Material Development-Related, and Administrative activity costs. The invoice and supporting documents are for work performed by CPA and its Subcontractors.
(12) Invoice Deficiencies. In the event County determines that CPA's (or any of its Subcontractors' that are included for payment) invoices do not meet the invoicing requirements of the MOU, lack accounting transparency, and/or lack sufficient material support, County will notify CPA of the deficiencies and CPA shall promptly correct such deficiencies. County has the right to review and approve the data and the methods used to develop the invoice documentation. However, the failure of County to conduct such review or grant such approval shall not relieve CPA from its responsibilities and obligations under a particular invoice.
(13) Payment by County. County shall pay undisputed charges within net thirty (30) days of receiving invoices that follow the requirements set forth in this MOU. County has the right to withhold payment of particular charges that County disputes in good faith, pending the resolution of the dispute, and County will provide CPA with notice of the amounts being withheld and the reasons for the dispute.
V. County RESPONSIBILITIES
A. County shall periodically monitor the project performance by CPA on programs/projects activities by review of project records and meetings with CPA's staff. County shall promptly notify CPA of changes in any regulatory requirements, specifically governing the administration of funds, that become effective following the execution of this MOU.
B. County may, after review and evaluation of the programs, modify the amount of funds designated for the programs, and/or require CPA to implement changes in the scope of services to be performed by CPA, in alignment with the agreement established between County and CEC.
C. County authorizes CPA staff to assist the CEC EBD DI Program in accordance with all applicable federal, State, and County laws and regulations. Where necessary, County shall make available designated staff to work with CPA staff designated to assist the program on project-related activities.
Agenda Page 20
6 VI. AMENDMENT TO MOU
Upon written consent from both parties, County and CPA may modify the amount of funds designated to assist the CPA programs and/or modify the scope of services to be performed, subject to costs incurred or encumbered by contractual agreement, in alignment with the agreement established between County and CEC. However, any other changes to this MOU must be accomplished by a written amendment to this MOU by both parties.
VII. TERMINATION OF MOU
Either party may terminate this MOU by giving the other party 30 days written notice; provided that, upon a termination of this MOU by County pursuant to this Section VII, (a) CPA shall submit invoices related to the performance of services, which shall be performed by CPA prior to the termination of this MOU, as soon as reasonably practicable and no later than ninety (90) days after County submits written notice of its intent to terminate this MOU and (b) County shall perform the requirements specified in Section III of this MOU. County’s obligation to compensate CPA for services performed by CPA prior to the termination of this MOU shall survive after this MOU expires or is terminated and remain in full force and effect in all respects.
VIII. List of Attachments
A. Scope of Work
B. Budget
C. Schedule of Products
D. CEC EBD DI Program Terms and Conditions
E. [Reserved]
F. CEC Invoice Template
[Signatures continue on the following
page.]
Agenda Page 21
7 SIGNATURES
IN WITNESS WHEREOF, the County and the Clean Power Alliance, by and through their duly authorized representatives have caused this MOU to be subscribed to on the day and year first above written.
COUNTY OF LOS ANGELES
INTERNAL SERVICES DEPARTMENT
By
Michael Owh,
DIRECTOR
Date ___/___/___
CLEAN POWER ALLIANCE OF
SOUTHERN CALIFORNIA
By
Ted Bardacke
CHIEF EXECUTIVE OFFICER
Date ___/___/___
APPROVED AS TO FORM:
DAWYN R. HARRISON
COUNTY COUNSEL
By ___________________________________
JASON C. CARNEVALE
Deputy County Counsel
Agenda Page 22
1 ATTACHMENT A
SCOPE OF WORK
Scope of Work (“SOW”) for Clean Power Alliance
The primary objective of this SOW is to outline the roles, responsibilities, and approved activities for Clean Power Alliance of Southern California (“CPA”), a Community Choice Aggregator (“CCA”) participating in the California Energy Commission’s (“CEC”) Equitable Building Decarbonization (“EBD”) Direct Install (“DI”) Program (“EBD DI Program”) in the Southern Region as a EBD DI Program Partner (“Partner”). CPA will complete the tasks outlined below under the direction of the Program Administrator County of Los Angeles (“County”).
Program Overview
The EBD DI Program will accelerate large-scale residential building decarbonization efforts underway in Southern California for single-family homes, multifamily properties, manufactured housing, and public housing in underresourced communities, as mutually defined by County and CPA. The EBD DI Program includes Community-based Organization (“CBO”) and Partner-led Marketing, Education, and Outreach (“ME&O”) to underserved communities to identify properties eligible for decarbonization measures for the purpose of connecting them with a Program Advisor who will complete eligibility screenings and is the primary liaison for all program-related matters with the program participants, and will support education of interested community members and provide individualized support throughout the retrofit process (“Program Advisor”). Specific, geotargeting to qualified addresses within the respective community focus areas shall be identified by County and the Implementation Team, led by ICF and collaborates with County to execute the program, supervise and deliver outreach, workforce planning, home energy assessments, project management, and quality assurance (“Implentation Team”) through the use of qualifying data, compiled and then shared with CBOs and Partners to conduct ME&O activities through the guidance of the Area Coordinator, led by The Energy Coalition as the local representative of the program who engages with community Partners in the training for program ME&O (“Area Coordinator”). The forthcoming ME&O Plan (“ME&O Plan”) shall describe this process in detail, and CPA and County shall mutually agree to implement the ME&O Plan.
CPA will be responsible for conducting tailored and culturally relevant ME&O activities to inform and engage potential participants about the EBD DI Program and its benefits. Activities will be informed by deep knowledge of the local needs, challenges, opportunities, and resources of communities, and delivered through established relationships. Each CBO will be supported by a dedicated Area Coordinator who serves as the liaison between Partners and the Implementation Team. The Area Coordinator is the single point of contact for CBOs to facilitate effective and timely communication. The Area Coordinator will meet regularly with CBOs to collect activity logs, gather feedback and lessons learned from outreach efforts, and provide guidance and support as needed.
Roles and Responsibilities
CPA will participate in activities to boost awareness and drive participation in EBD Direct Install Program among targeted Southern California communities by educating residents on the environmental, economic, and health benefits of the program. CPA project tasks are numbered pursuant to CEC EBD DI Program tasks, summarized below in Table 1. CPA’s approved Marketing, Education & Outreach activities are listed in Table 2, all of which may be conducted at the discretion of CPA.
Table 1. Task Summary
Agenda Page 23
2 Task # Task Name
5.8.1 Outreach Strategies
5.8.2 Education Activities
5.8.3 Participant Handoff
5.8.4 Meetings and Reporting
CPA will maintain detailed records of all expenditures and submit regular invoices as per the terms of its contract with County.
Monthly invoices shall be submitted clearly identifying Task 5.8, using the invoice template (Attachment F. CEC Invoice Template) with all required supporting documentation, to County by the 7th of every month.
Task 5.8.1. Outreach Strategies
CPA will conduct outreach and engagement in each Community Focus Area (“Community Focus Area”), as mutually defined by County and CPA, under the guidance of the Area Coordinator and Program Implementer. CPA is expected to implement a variety of outreach strategies to effectively reach the target audience and shall make best efforts to perform outreach in a culturally appropriate manner. Outreach strategies may include community events such as workshops, town hall meetings, and informational booths at local markets and festivals to provide opportunities for direct engagement.
Digital campaigns will utilize social media, email newsletter, and community toolkits to disseminate information widely and engage with residents online. Print materials, including flyers, facts sheets, brochures, (provided by the Program) may be distributed in community centers, libraries, and local businesses to ensure that information is accessible to those who may not be reached through digital channels.
Initially, CPA will serve as the point of contact for participating households. Once participants express interest in the EBD Direct Install Program, CPA will connect interested residents with the Program Implementer, ICF, to complete eligibility screening and assignment to an Intake Advisor, that supports potential program participants with initial intake of participant information (“Intake Advisor”) for enrollment support and a Program Advisor for long-term program support.
CPA will customize outreach materials and conduct outreach for participating community to engage participants, and may encourage local contractors and trade allies’ participation.
Task 5.8.1 Deliverables
• Attend annual Area Coordinator ME&O Strategy Meeting
• Annual outline of anticipated events and estimated target audience quantities per event type to Area Coordinator
Task 5.8.2 Education Activities
CPA shall engage the community through various activities designed to educate and involve community members in the EBD DI Program. Activities may include workshops and demonstrations to provide hands-on experiences with decarbonization technologies such as heat pumps and induction cooktops, helping residents understand how these technologies work and the benefits they offer. Activities may also include success stories, including testimonials and case studies from participants who have benefited from the program, may be shared to build trust and encourage others to enroll. Educational
Agenda Page 24
3 sessions may be offered to provide in-depth information on energy efficiency and decarbonization, helping community members make informed decisions. Partnerships with local schools, churches, and community groups may be established to co-host events and spread awareness, ensuring that outreach efforts are integrated into existing community activities. In planning education activities and interactions with the public, CPA is expected to adhere to the following guidelines and raise any concerns immediately to the assigned Area Coordinator.
• Provide potential program participants with educational materials in appropriate languages about the EBD Direct Install Program, the benefits of building decarbonization, and how the program’s Program Advisor will provide support before, during, and after the retrofit project. • Ensure outreach and engagement includes clear information on CEC-approved programs and products and does not include third-party services or products not associated with the EBD DI Program or otherwise approved by CEC.
• Include prevention measures to ensure the CEC, California Climate Investments (“CCI”), and Department of Energy (“DOE”) names and logos, and the EBD DI Program, are not used for private party advertising or gain, or to mislead or exploit property owners or occupants.
Task 5.8.2 Deliverables
• Quarterly update of confirmed events to Area Coordinator, including specific outreach activities, location of event, date of event, and anticipated target audience attendees for each event.
Table 2. Approved Outreach & Education Activities
The following activities may be performed at the discretion of CPA:
Outreach Event
Types Sample Approved Activities
Estimated Total
Target Audience
Reached (Number)
Church Socials
• Presentations
• Discussions
• Share education materials
• To be mutually
determined by
CPA and County
Community
Parties
• Interactive games
• Demonstrations
• Testimonials & success stories
Cultural Events
• Art showcases
• Cultural performances
• Informational booths
Digital
Campaigns
• Social media posts
• Email newsletters
• Online workshops
Fairs and
Festivals
• Booths with information
• Educational games
• Giveaways
Health Clinics
• Information tables at health fairs
• Presentations at wellness workshops
• In-office info/flyers on bulletin boards
Agenda Page 25
4 Outreach Event
Types Sample Approved Activities
Estimated Total
Target Audience
Reached (Number)
Neighborhood
Meetings
• Presentations Q&A sessions
• Distribution of informational packets
• Showcase of completed project in
neighborhood
Partnership
Events
• Co-hosted events with local schools and
businesses
• Distribution of educational materials
• Speaking opportunities
• To be mutually
determined by
CPA and County
Public Events
• Informational booths
• Workshops & demonstrations
• Q&A sessions
School Events
• Educational sessions
• Science fairs
• Environmental clubs
Workshops/Other
• Hands-on demonstrations
• Educational sessions
• Tabling
Task 5.8.3 Participant Handoff
CPA will conduct outreach and educational activities for the target audiences in each Community Focus Area, as mutually defined by County and CPA and connect interested residents with the Program Implementer, ICF, to complete eligibility screening and assignment to an Intake Advisor for enrollment support and a Program Advisor for long-term program support.
CPA may support follow-up surveys, developed by ICF, to participating households.
Task 5.8.3 Deliverables
• Support potential participants in completing an Interest Form, which form shall be mutually agreed upon by CPA and County.
• Provide a list of interested participants to the Program Implementer on a monthly basis by the 7th of the month.
Task 5.8.4. Meetings and Reporting
CPA will track and report on program activity. CPA will ensure adherence to program guidelines and quality standards in all outreach activities, and the timeliness and accuracy of reporting on outreach activities, and outcomes.
• Lead Generation: Count the number of leads generated from outreach activities and potential participants handed off to the Intake Advisor.
Task 5.8.4 Deliverables
• Attend bi-weekly Area Coordinator meetings
Agenda Page 26
5 • Support event attendance, lead generation, and participant hand-off reporting with Area Coordinator.
• Submit marketing, education and outreach activity reports to Area Coordinators on a biweekly basis as determined by Area Coordinators/ICF.
Timeline
Work and deliverables are to be completed in accordance with Task 5.8 in the CEC Schedule of Products (Attachment C).
Budget (Attachment B)
Please see budget allocation (Attachment B). Per the CEC EBD DI Program Terms and Conditions (Attachment D), any budgetary alterations shall adhere to Section 6. Changes to the Agreement.
Summary of Deliverables
Task # Task Name Deliverables
5.8.1 Outreach
Strategies
• Attend annual Area Coordinator ME&O Strategy Meeting
• Annual outline of anticipated events to Area Coordinator
5.8.2 Education
Activities
• Quarterly update of confirmed events to Area Coordinator, including specific outreach activities, location, date, and anticipated target audience attendees for each event.
5.8.3 Participant
Handoff
• Support potential participants in completing an Interest Form
• Provide a list of interested participants to the Program Implementer on a monthly basis by the 5th of the month.
5.8.4 Meetings and
Reporting
• Attend bi-weekly Area Coordinator meetings
• Support event attendance, lead generation, and participant hand-off reporting with Area Coordinator.
• Submit marketing, education and outreach activity reports to Area Coordinators on a biweekly basis as determined
by Area Coordinators/ICF.
Agenda Page 27
B- 1
ATTACHMENT B
BUDGET
BUDGET SUMMARY
Cost Category
EBD
Reimbursable
Share
Match Share Total Administration Project-Related Project Administration Project-Related Project Administration Project-Related Project Direct Labor $ 643,269 $ - $ 643,269 $ - $ 643,269 $ - $ - $ - $ - $ - $ 643,269 $ - Fringe Benefits $ 57,894 $ - $ 57,894 $ - $ 57,894 $ - $ - $ - $ - $ - $ 57,894 $ - Total Labor $ 701,163 $ - $ 701,163 $ - $ 701,163 $ - $ - $ - $ - $ - $ 701,163 $ - Travel $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ -
Equipment $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Materials/Miscellaneous $ 263,637 $ - $ 263,637 $ - $ 263,637 $ - $ - $ - $ - $ - $ 263,637 #NAME? Subcontractors $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Total Other Direct Costs $ 263,637 $ - $ 263,637 $ - $ 263,637 $ - $ - $ - $ - $ - $ 263,637 $ - Indirect Costs $ - $ - $ - $ - N/A N/A $ - N/A N/A $ - $ - $ - Profit (not allowed for grant
recipients) $ - $ - $ - $ - N/A N/A $ - N/A N/A $ - $ - $ - Total Indirect and Profit $ - $ - $ - $ - N/A N/A $ - N/A N/A $ - $ - $ - Grand Totals $ 964,800 $ - $ 964,800 $ - $ 964,800 $ - $ - $ - $ - $ - $ 964,800 $ - Amount of Funds to be Spent
in California** Percent of Total 0% 100% 0% #DIV/0! #DIV/0! #DIV/0! 0% 100% 0% Percentage of Funds to be
spent in California
State EBD Funds by Category Federal EBD Funds by Category Total EBD Funds (State and Federal) by Category
Agenda Page 28
B- 2
LABOR
FRINGE BENEFITS
MATERIALS & MISCELLANEOUS
Hourly Rates
Employee Name
Job Classification /
Title
Cost Category
(Select from drop-down menu)
Maximum
Labor Rate
($ per hour)
# of
Hours
State EBD
Funds
Federal EBD
Funds
Total EBD
Funds
(State+Fed)
Match
Share Total
TBD Marketing Project Manager Project-Related $ 96.53 120 $ 11,584 $ - $ 11,584 $ - $ 11,584 John Spector Program Manager Project-Related $ 127.66 557 $ 71,107 $ - $ 71,107 $ - $ 71,107 TBD Senior Marketing Associate Project-Related $ 96.53 5,568 $ 537,479 $ - $ 537,479 $ - $ 537,479 TBD Senior Marketing Manager Project-Related $ 154.00 150 $ 23,100 $ - $ 23,100 $ - $ 23,100 $ - $ - $ - $ - $ - $ -
$ - $ - $ - $ - $ - $ -
Hourly Direct Labor Totals $ 643,269 $ - $ 643,269 $ - $ 643,269.26 Fringe Benefit Base Description
(Employee or Job Classification/Title)
Cost Category
(Select from drop-down menu)
Max.
Fringe
Benefit
Rate (%)
Direct Labor Costs -
State EBD Funds ($)
Direct Labor Costs -
Federal EBD Funds
($)
Fringe Benefits -
State EBD
Funds
Fringe Benefits -
Federal EBD
Funds
Fringe Benefits -
Total EBD Funds
(State+Fed)
Match
Share Total
Marketing Project Manager Project-Related 9.00% $ 11,584 $ - $ 1,043 $ - $ 1,043 $ - $ 1,043 Program Manager Project-Related 9.00% $ 71,107 $ - $ 6,400 $ - $ 6,400 $ - $ 6,400 Senior Marketing Associate Project-Related 9.00% $ 537,479 $ - $ 48,373 $ - $ 48,373 $ - $ 48,373 Senior Marketing Manager Project-Related 9.00% $ 23,100 $ - $ 2,079 $ - $ 2,079 $ - $ 2,079 Fringe Benefit Totals $ 643,269 $ - $ 57,894 $ - $ 57,894 $ - $ 57,894.23
Agenda Page 29
B- 3
TRAVEL & EQUIPMENT
No costs
Cost Category
(select from drop-down menu) Description Purpose Cost Basis# Units Unit Cost
State EBD
Funds
Federal EBD
Funds
Total EBD
Funds
(State+Fed)
Match
Share Total
Project-Related Fact sheets Fact sheets for
engagement events Prior invoice 4794 $ 2.08 $ 9,972 $ - $ 9,972 $ - $ 9,972 Project-Related Paid Media
Paid media includes
out of home, radio and
social media
Prior invoice 30736 $ 2.31 $ 71,000 $ - $ 71,000 $ - $ 71,000 Project-Related Post Cards Post cards mailed to
qualifying customers Prior invoice 25320 $ 0.62 $ 15,698 $ - $ 15,698 $ - $ 15,698 Project-Related Business Return Mail Enrollment mailer with business return mail Prior invoice 79486 $ 0.65 $ 51,666 $ - $ 51,666 $ - $ 51,666 Project-Related Digital Video 30 second video with
subtitles Prior invoice 1 $ 23,001.10 $ 23,001 $ - $ 23,001 $ - $ 23,001 Project-Related Webpage(s)
Webpage layout,
design, and hosting
maintenance
Prior invoice 3 $ 4,166.67 $ 12,500 $ - $ 12,500 $ - $ 12,500 Project-Related Emails (creative
templates)
Email creative
templates for outreach Prior invoice 3 $ 6,010.50 $ 18,032 $ - $ 18,032 $ - $ 18,032 Project-Related Translations Marketing translation
services (3 languages) Prior invoice 1 $ 7,000.00 $ 7,000 $ - $ 7,000 $ - $ 7,000 Project-Related CBO Collaboration Enrollment during
outreach events Prior invoice 24 163.00 $ $ 3,912 $ - $ 3,912 $ - $ 3,912 Project-Related Creative Development
Adapting creative
assets for social
media, out of home,
Prior invoice 1 $ 50,856.37 $ 50,856 $ - $ 50,856 $ - $ 50,856 Total: $ 263,637 $ - $ 263,637 $ - $ 263,636.96
Agenda Page 30
B- 4
SUBCONTRACTS, INDIRECT COSTS AND PROFIT
No costs
Agenda Page 31
C- 1
ATTACHMENT C
SCHEDULE OF PRODUCTS
Task
Number
Task
Name Product(s) Due Date
1.1 Attend Kick-off Meeting
Kick-Off Meeting Agendas (CEC) 10 calendar days before Kick-Off Meetings Updated Schedule of Products and Due Dates 10 calendar days after Kick-off Meetings
1.2 Critical Project Review (CPR) Meetings
Agenda and a list of expected participants (CEC) 10 calendar days before CPR meeting CPR Report 10 calendar days before CPR meeting
Schedule for written determination (CEC) 10 calendar days after CPR meeting Written determination (CEC) As indicated in schedule for written determination
1.3 Program Meetings and Briefings (2 per month for first year) Agenda and a list of expected participants (CEC) 10 calendar days before Meeting Written documentation of meeting agreements 5 calendar days after meeting
1.4 Advisory Group
List of potential Advisory Group members for the
region At Kick-off Meeting
Final list of potential Advisory Group members (CEC) 30 calendar days after Kick-off Meeting List of confirmed Advisory Group members for the
region
15 calendar days after receiving the list
from CEC
Advisory Group meeting agendas (CEC) 5 calendar days before Meetings
1.5 Invoices
Invoices 15th of every month or as specified by CAM
True-up updates for advanced funds 15th of every month or as specified by CAM
1.6 Monthly Progress Report
Monthly progress reports 15th of every month
1.7 Obtain and Execute Subawards
List of subaward agreements and timeline for
execution At Kick-off Meeting
Subaward agreements (Draft, if requested) 30 calendar days after Kick-off Meeting Subaward agreements (Final) 52 calendar days after Kick-off Meeting
1.8 Annual Reports and Presentations
Annual reports and presentations (Drafts) January 30
Annual reports and presentations (Finals) 15 calendar days after CAM provides comments on draft reports
1.9 Final Report and Presentation
Final report (Draft) 90 calendar days before the end of the agreement term
Final report (Final) 60 calendar days before the end of the Agreement Term
1.10 Final Meetings
Written documentation of meeting agreements and
unresolved activities 5 calendar days after final meeting Schedule for completing closeout activities 10 calendar days after final meeting For each
CPR
Meeting
Agenda Page 32
C- 2
2 Internal Controls, Processes and Procedures
Internal controls, processes, and procedures 2 months after Kick-off Meeting Updated internal controls, processes, and
procedures
As needed or requested by the CAM (no
less than annually)
Monthly fiscal accounting in Task 1.6 Monthly
Progress Reports 15th of every month
3 Program Data Collection and Reporting
Project data Daily or as specified by CAM
Metrics and Data Reports Within 15 calendar days of CAM request 4 Assist CEC with DOE HOMES Application Components
Responses for DOE application components (Draft) Within 15 calendar days of request from CAM
Responses for DOE application components (Final) Within 15 calendar days of request from CAM
Components for Consumer Protection Plan (Draft) Within 15 calendar days of request from CAM
Components for Consumer Protection Plan (Final) Within 15 calendar days of request from CAM
Components for Market Transformation Plan (Draft) Within 15 calendar days of request from CAM
Components for Market Transformation Plan (Final) Within 15 calendar days of request from CAM
Input on draft Community Benefits Plan, Education
and Outreach Strategy, Utility Data Access Plan, and
Privacy and Security Risk Assessment
Within 15 calendar days of request from
CAM
5.1 Community Focus Areas
Proposed Initial Community Focus Areas List and
Justification As part of application
Final Initial Community Focused Areas List 1 month after Kick-off Meeting Amended Community Focus Areas List and
Justification
30 calendar days after request from the
CAM
5.2 Community Application Process
Proposed Community Application Process and
Selection Criteria 6 months after Kick-off Meeting
Final Community Application Process and Selection
Criteria 9 months after Kick-off Meeting
5.3 Workforce Plan and Contractor Enrollment
Workforce Plan outline 2 months after Kick-off Meeting
Workforce Plan (Draft) 3 months after Kick-off Meeting
Workforce Plan (Final) 5 months after Kick-off Meeting
Data submitted as part of Task 3 See Task 3
5.4 Standard Packages of Measures
Packages of Measures 4 months after Kick-off Meeting
Bi-Annual Report on Packages of Measures June 30th and December 31st of each calendar year (excluding the fifth year)
5.5 Pricing and Cost Caps
Cost-Control Mechanisms 4 months after Kick-off Meeting Data submitted as part of Task 3 See Task 3
5.6 Household/Property Targeting
Household Identification and Screening Plan (Draft) 3 months after Kick-off Meeting Household Identification and Screening Plan (Final) 5 months after Kick-off Meeting
5.7 Set-Aside for Manufactured Homes
Manufactured and Mobile Homes Service Plan
(Draft) 6 months after Kick-off Meeting
Manufactured and Mobile Homes Service Plan (Final) 9 months after Kick-off Meeting Data submitted as part of Task 3 See Task 3
5.8 Outreach and Engagement
Outreach Materials 5 months after Kick-off Meeting
Outreach and Engagement Log Part of Task 3 Project Data
Agenda Page 33
C- 3
5.9 Household Eligibility and Initial Enrollment
Application Template 2 months after Kick-off Meeting
Data submitted as part of Task 3 See Task 3
5.10 Home Assessments
Home Assessment Approach and Processes (Draft) 3 months after Kick-off Meeting Home Assessment Approach and Processes (Final) 5 months after Kick-off Meeting Updated Home Assessment Approach and Processes
(if requested by CAM) within 30 days of request from CAM Data submitted as part of Task 3 See Task 3
5.11 Program Participation Agreements and Tenant Protections Program Participation Agreement Template 5 months after Kick-off Meeting Data submitted as part of Task 3 See Task 3
5.12 Building Decarbonization Retrofits
Data submitted as part of Task 3 See Task 3
Post-installation Project Certificate Template (Draft) 5 months after Kick-off Meeting Post-installation Project Certificate Template (Final) 6 months after Kick-off Meeting
5.13 Quality Assurance and Quality Control (QA/QC)
Hotline Call Log Tracker Weekly or as specified by the CAM QA/QC Procedures (Draft) 4 months after Kick-off Meeting QA/QC Procedures (Final) 6 months after Kick-off Meeting Data submitted as part of Task 3 See Task 3
5.14 Participant Surveys
Participant Survey (Draft) 5 months after Kick-off Meeting Participant Survey (Final) 9 months after Kick-off Meeting Data submitted as part of Task 3 See Task 3
6 Continuous Improvement
No Recipient Products for this Task
7 Coordination and Layering with Other Programs
Coordination Plan (Draft) 4 months after Kick-off Meeting Coordination Plan (Final) 6 months after Kick-off Meeting Data submitted as part of Task 3 See Task 3
8 Coordination with Other Programs and Public Interest Research Data submitted as part of Task 3 See Task 3
Agenda Page 34
Terms and Conditions GFO-23-404
April 2024 i EBD Direct Install Program
ATTACHMENT D
CEC EQUITABLE BUILDING DECARBONIZATION
DIRECT INSTALL PROGRAM TERMS AND CONDITIONS
TABLE OF CONTENTS
SECTION PAGE NO.
1. Grant Agreement.................................................................................................... 1
2. Documents Incorporated by Reference ............................................................... 2
3. Due Diligence ......................................................................................................... 3
4. Products.................................................................................................................. 3
5. Publications - Legal Statement on Reports and Products ................................. 4
6. Changes to the Agreement.................................................................................... 5
7. Contracting and Procurement Procedures.......................................................... 7
8. Bonding and Insurance ....................................................................................... 10
9. Permits and Clearances....................................................................................... 10
10. Equipment......................................................................................................... 10
11. Termination....................................................................................................... 11
12. Stop Work.......................................................................................................... 11
13. Travel and Per Diem......................................................................................... 12
14. Standard of Performance................................................................................. 12
15. Payment of Funds ............................................................................................ 13
16. Fiscal Accounting Requirements.................................................................... 18
17. Indemnification................................................................................................. 19
18. Workers' Compensation Insurance................................................................. 19
19. General Provisions........................................................................................... 20
20. Certifications and Compliance........................................................................ 21
21. Site Visits .......................................................................................................... 24
22. Budget Contingency Clause............................................................................ 24
23. Public Works -- Payment of Prevailing Wages............................................... 24
24. Intellectual Property ......................................................................................... 27
25. CEC Remedies for Recipient’s Non-Compliance........................................... 28
26. Enforcement...................................................................................................... 28
27. Confidential Recipient Information................................................................. 29
28. Receipt of Confidential Information and Personal Information.................... 30
29. Executive Order N-6-22 – Russia Sanctions .................................................. 32
30. Greenhouse Gas Reduction Fund Requirements.......................................... 32
31. Conflicts of Interest.......................................................................................... 34
32. Disclosure......................................................................................................... 35
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TERMS AND CONDITIONS
1. Grant Agreement
This project is being funded with a grant from the California Energy Commission’s (CEC) Equitable Building Decarbonization Program. The Equitable Building Decarbonization Program is funded in part by the California Climate Investments2 program, and is subject to the laws enacted for the administration of auction proceeds deposited into the Greenhouse Gas Reduction Fund, including without limitation: AB 109 (Chapter 249, Statutes of 2017); Health and Safety Code section 39710 et. seq.; and Government Code sections 16428.8 – 16428.95, including any amendments to these sections.
Under this Agreement, the Recipient shall develop and implement the Equitable Building Decarbonization Direct Install Program, which is a block grant program and governed by California Public Resources Code section 25665.3. Recipient understands that the CEC currently only has $19,096,500 of the potential $31,108,439 maximum possible funding for administrative costs under this Agreement and $171,868,500 of the potential $297,869,301 for incentives awarded under this Agreement. Therefore, upon execution of this Agreement, Recipient only has authority to spend up to $19,096,500 in administrative costs, not to exceed 10 percent of the total budget for state funds and 8 percent of the total budget for federal funds. In the future, the CEC may allocate none, some, or the entire remaining contingent amount up to a maximum amount of $31,108,439 in administrative costs. Recipient shall only be authorized to spend more than the existing $31,108,439 in administrative costs upon execution of an amendment to this Agreement that authorizes the Recipient to spend more funds.
The Recipient, as implementer of the Equitable Building Decarbonization Direct Install Program, is a conduit of the funds that will be awarded to provide assistance to Retrofit Awardees, and the grant-funded Retrofit Awards do not result in the performance of services by the Retrofit Awardees to the CEC, but the CEC is a real party in interest to the agreements between the Recipient and Retrofit Awardees.
The CEC will not take title to equipment acquired by the Retrofit Awardees; and the performance under the Retrofit Awards is not controlled by the CEC. The Retrofit Awardees are being provided assistance to carry out their own projects and are not providing services to the CEC or Recipient. The Retrofit Awards directly benefit each Retrofit Awardee’s project. The products produced by the Recipient are a by-product of the main purpose of the block grant. The products are used to monitor the use of grant funds and do not result in a service to the CEC.
2 California Climate Investments is a statewide initiative that puts billions of Cap-and-Trade dollars to work reducing greenhouse gas emissions, strengthening the economy, and improving public health and the environment – particularly in disadvantaged communities.
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This Agreement is comprised of the grant funding award, these Terms and Conditions, and all attachments, including Federal Award Terms and Conditions (Attachment 10). These Terms and Conditions are standard requirements for grant awards. The CEC may impose additional special conditions in this grant Agreement that address the unique circumstances of this project. Special conditions that conflict with these standard provisions take precedence.
The Recipient’s authorized representative shall sign all copies of this Agreement and return all signed packages to the CEC's Grants and Loans Office within 30 days of receipt. Failure to meet this requirement may result in the forfeiture of this award.
When all required signatures are obtained, an executed copy will be returned to the Recipient.
The term of this Agreement or the Agreement Period is the length of this Agreement between the CEC and the Recipient. Project means Recipient’s specific project that is funded in whole by this Agreement. The Recipient’s project will coincide with the Agreement Period.
All reimbursable work and/or the expenditure of funds must occur within the approved term of this Agreement. The CEC cannot authorize any payments until all parties sign this Agreement.
2. Documents Incorporated by Reference
The documents below are incorporated by reference into this Agreement. These terms and conditions will govern in the event of a conflict with the documents below, with the exception of the documents in subsections (e) and (f). Where this Agreement or California laws and regulations are silent or do not apply, the CEC will use the federal cost principles and acquisition regulations listed below as guidance in determining whether reimbursement of claimed costs is allowable. Documents incorporated by reference include:
CEC Guidelines
a. Equitable Building Decarbonization Direct Install Program Guidelines, https://www.energy.ca.gov/publications/2023/equitable-building-decarbonization-direct-install-program-guidelines.
Solicitation Documents (if award is made through a competitive solicitation) b. The funding solicitation under which this Agreement was awarded.
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c. The Recipient’s proposal submitted in response to the solicitation.
California Air Resources Board Documents
d. California Air Resources Board, Funding Guidelines for Agencies that Administer California Climate Investments, www.arb.ca.gov/cci-fundingguidelines Federal Cost Principles (applicable to state and local governments, Indian tribes, institutions of higher education, and nonprofit organizations) e. 2 Code of Federal Regulations (CFR) Part 200, Subpart E (sections 200.400 et seq.).
Federal Acquisition Regulations (applicable to commercial organizations) f. 48 CFR, Ch.1, Subchapter E, Part 31, Subpart 31.2: Contracts with Commercial Organizations (supplemented by 48 CFR, Ch. 9, Subchapter E, Part 931, Subpart 931.2 for Department of Energy grants).
Nondiscrimination
g. 2 California Code of Regulations (CCR), section 11099 et seq.: Contractor Nondiscrimination and Compliance.
General Laws
h. Any federal, state, or local laws or regulations applicable to the project that are not expressly listed in this Agreement.
3. Due Diligence
The Recipient is required to take timely actions which, taken collectively, move this project to completion. The Commission Agreement Manager (CAM) will periodically evaluate the project schedule and the Scope of Work tasks. If the CAM determines (1) the Recipient is not being diligent in completing the tasks in the Statement of Work or (2) the time remaining in this Agreement is insufficient to complete all project work tasks by the approved Agreement end term date, the CAM may recommend that this Agreement be terminated, and the Agreement may, without prejudice to any of the CEC’s remedies, be terminated.
4. Products
a. “Products” are defined as any tangible item specified for delivery to the CEC in the Scope of Work, including but not limited to data, reports, plans, and other program documents. Unless otherwise directed, draft copies of all products identified in the Scope of Work and Schedule of Products shall be submitted to the CAM for review and comment in the manner and form specified in the Scope of Work.
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b. If the CEC determines that a product is substandard given its description and intended use as described in this Agreement, CEC staff, without prejudice to any of the CEC’s other remedies, may refuse to authorize payment for the product and any subsequent products that rely on or are based upon the product under this Agreement.
c. Failure to submit a product required in the Scope of Work may be considered material noncompliance with the Agreement terms. Without prejudice to any other remedies, noncompliance may result in actions such as the withholding of future payments or awards, or the suspension or termination of the Agreement.
5. Publications - Legal Statement on Reports and Products a. The Recipient is encouraged to publish or otherwise make publicly available the results of the work conducted under the award.
No product or report produced because of work funded by this program shall be represented to be endorsed by the CEC, and all such products or reports shall include the following statement:
LEGAL NOTICE
This document was prepared as a result of work sponsored by the California Energy Commission. It does not necessarily represent the views of the CEC, its employees, or the State of California. The CEC, the State of California, its employees, contractors, and subcontractors make no warranty, express or implied, and assume no legal liability for the information in this document; nor does any party represent that the use of this information will not infringe upon privately owned rights. b. Acknowledgement of California Climate Investments
Recipients shall acknowledge the California Climate Investments program as the source of project funds, in any publications, websites, signage, invitations, and other media-related and public-outreach products. The standard funding language is:
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The Equitable Building Decarbonization Program is part of California Climate Investments, a statewide initiative that puts billions of Cap-and-Trade dollars to work reducing greenhouse gas emissions, strengthening the economy, and improving public health and the environment – particularly in
disadvantaged communities. The Cap-and-Trade program
creates a financial incentive for industries to invest in clean technologies and develop innovative ways to reduce pollution.
California Climate Investments projects include affordable housing, renewable energy, public transportation, zero-emission vehicles, environmental restoration, more sustainable agriculture, recycling, and much more. At least 35 percent of these investments are located within and benefiting residents of disadvantaged communities, low-income communities, and low-income households across California. For more
information, visit the California Climate Investments website at: www.caclimateinvestments.ca.gov.
The Recipient is encouraged to display the California Climate Investments logo on equipment and signage to acknowledge the funding source.
Guidance on California Climate Investments logo usage, signage guidelines, and high-resolution files are contained in a style guide available at:
http://www.caclimateinvestments.ca.gov/logo-graphics-request.
6. Changes to the Agreement
a. Procedure for Requesting Changes
The Recipient must submit a written request to the CAM for any change to the Agreement. The request must include:
• A brief summary of the proposed change;
• A brief summary of the reason(s) for the change;
• Justification for the change; and
• The revised section(s) of the Agreement, with changes made in underline/ strikethrough format.
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b. Approval of Changes
No amendment or variation of this Agreement shall be valid unless made in writing and signed by both of the parties except for the CEC’s unilateral termination rights in Section 11 of these terms. No oral understanding or agreement is binding on any of the parties. Changes to the Agreement must be approved at a CEC business meeting or by the Executive Director (or his/her designee).
The CAM or Commission Agreement Officer (CAO) will provide the Recipient with guidance regarding the level of CEC approval required for a proposed change.
c. Personnel or Subcontractor Changes
All changes below require advance written approval by the CAM, in addition to the appropriate level of CEC approval as described in subsection (b). 1) Replacement of Key Personnel, Subcontractors, and Vendors The CAM must provide advance written approval of the replacement of personnel, subcontractors, and vendors who are identified in the Agreement and are critical to the outcome of the project, such as the Project Manager.
2) Assignment of New Personnel to an Existing Job Classification If the Recipient or a subcontractor seeks to assign new personnel to a job classification identified in Attachment 4 (Budget Forms), the Recipient or subcontractor must submit the individual’s resume and proposed job classification and rate to the CAM for approval. The proposed rate may not exceed the maximum rate identified for the job classification. Neither the Recipient nor any subcontractor may use the job classifications or rates of their subcontractors for personnel.
If the individual performs any work prior to the effective date of the amendment documenting the change, the Recipient will bear the expense of the work.
3) Promotion of Existing Personnel (Applies to Recipients and major subcontractors)
Promotion of existing Recipient and major subcontractor personnel to rates higher than those listed for their current classification in Attachment 4 will not be approved. The actual rates (e.g., direct labor rates, fringe benefit rates, and indirect rates) shall not exceed the approved rates in the Budget.
4) Addition of job classifications and changes in hours.
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5) Increased direct operating expenses and rates that exceed the expenses and rates identified in Attachment 4.
7. Contracting and Procurement Procedures
This section provides general requirements for (a) an agreement between the Recipient and a third-party subcontractor3 (subcontract), and (b) an agreement between the Recipient and a Retrofit Awardee (Retrofit Award). Where these terms require the Recipient to flow down terms to subcontractors and Retrofit Awardees, the Recipient shall ensure that its agreement with subcontractors and Retrofit Awardees also require the flow down of these terms to every lower-tiered level of sub-subcontractor and sub-Retrofit Awardee.
For subcontracts that are listed as “to be determined” in the Budget, the Recipient must submit a revised Budget to the CAM, identifying the subcontractor and specific items of cost expected to be incurred by that subcontractor. In addition, Recipient must have a fully executed subcontract or Retrofit Award before the subcontractor or Retrofit Awardee can incur any costs for which the Recipient will seek reimbursement.
The Recipient is required, where feasible, to employ contracting and procurement practices that promote open competition for all goods and services needed to complete this project. Recipient shall obtain price quotes from an adequate number of sources for all subcontracts.
The CEC will defer to the Recipient's own regulations and procedures as long as they reflect applicable state and local laws and regulations and are not in conflict with the minimum standards specified in this Agreement.
Upon request, the Recipient must submit to the CAM a copy of all solicitations for services or products required to carry out the terms of this Agreement and copies of the proposals or bids received.
3 A subcontractor is any person or entity that receives grant funds directly from the Recipient and is entrusted by the Recipient to make decisions about how to conduct some of the block grant project activities. A subcontractor’s role involves discretion over grant activities and is not merely just selling goods or services. A subcontractor cannot also be a Retrofit Awardee. A vendor is a person or entity that sells goods or services to the Recipient, Subcontractor, or any lower-tiered level of Sub-Subcontractor, in exchange for some of the grant funds, and does not make decisions about how to perform the grant’s activities. A vendor’s role is ministerial and does not involve discretion over grant activities.
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The Recipient is responsible for handling all contractual and administrative issues arising out of or related to any subcontracts it enters into under this Agreement.
Nothing contained in this Agreement or otherwise creates any contractual relation between the CEC and any subcontractors, and no subcontract may relieve the Recipient of its responsibilities under this Agreement. The Recipient agrees to be as fully responsible to the CEC for the acts and omissions of its subcontractors or persons directly or indirectly employed by any of them as it is for the acts and omissions of persons directly employed by the Recipient.
The Recipient’s obligation to pay its subcontractors is an independent obligation from the CEC’s obligation to make payments to the Recipient. As a result, the CEC has no obligation to pay or enforce the payment of any funds to any subcontractor. The Recipient is responsible for establishing and maintaining contractual agreements with and reimbursing each subcontractor for work performed in accordance with the terms of this Agreement.
All subcontracts must incorporate all of the following:
• A clear and accurate description of the material, products, or services to be procured as well as a detailed budget and timeline.
• A detailed budget and timeline.
• Provisions that allow for administrative, contractual, or legal remedies in instances where subcontractors violate or breach contract terms, and provide for such sanctions and penalties as may be appropriate. • Provisions for termination by the Recipient, including termination procedures and the basis for settlement, and language conforming to the termination provision related to Executive Order N-6-22 – Russia Sanctions. • A statement that further assignments will not be made to any third or subsequent tier subcontractor without additional advance written consent of the CEC.
• Language conforming to the following provisions:
• Publications - Legal Statement on Reports and Products (Section 5) • Equipment (Section 10)
• Travel and Per Diem (Section 13)
• Standard of Performance (Section 14)
• Fiscal Accounting Requirements (Section 16)
• Indemnification (Section 17)
• Nondiscrimination Statement of Compliance (Section 20.b) • Site Visits (Section 21)
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• Public Works – Payment of Prevailing Wages (Section 23) • Intellectual Property (Section 24)
• Remedies for Non-Compliance (Section 25)
• Enforcement (Section 26)
• Receipt of Confidential Information and Personal Information (Section 28)
• Conflicts of Interest (Section 31)
• Survival of the following provisions:
• Equipment (Section 10)
• Fiscal Accounting Requirements (Section 16)
• Intellectual Property (Section 24)
• Receipt of Confidential Information and Personal Information (Section 28)
Recipients who are subcontracting with University of California (UC) may use the terms and conditions negotiated by the CEC with UC for their subcontracts.
Recipients who are subcontracting with the United States Department of Energy (DOE) national laboratories may use the terms and conditions negotiated with DOE.
Without limiting any of the CEC’s other remedies, failure to comply with the above requirements may result in the termination of this Agreement.
Retrofit Awards funded in whole or in part by this Agreement must incorporate all of the following:
• Provisions that allow for administrative, contractual, or legal remedies in instances where Retrofit Awardees violate or breach contract terms, including Program Participation Agreement terms and the tenant protections therein, and provide for such sanctions and penalties as may be appropriate, including the repayment to CEC of grant funds spent under the Retrofit Award. • Provisions for termination by the Recipient, including termination procedures and the basis for settlement, and language conforming to the termination provision related to Executive Order N-6-22 – Russia Sanctions. • A statement that further assignments will not be made to any third or subsequent tier Retrofit Awardee without additional advance written consent of the CEC.
• Language conforming to the following provisions:
• Equipment (Section 10)
• Indemnification (Section 17)
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• Site Visits (Section 21)
• Remedies for Non-Compliance (Section 25)
• Enforcement (Section 26)
• Receipt of Confidential Information and Personal Information (Section 28), if applicable
• Conflicts of Interest (Section 31)
• Survival of the following provisions:
• Equipment (Section 10)
8. Bonding and Insurance
The Recipient will follow its own bonding and insurance requirements relating to bid guarantees, performance bonds, and payment bonds without regard to the dollar value of the subcontract(s) as long as they reflect applicable state and local laws and regulations.
9. Permits and Clearances
The Recipient is responsible for ensuring all necessary permits and environmental documents are prepared and clearances are obtained from the appropriate agencies.
10. Equipment
Equipment is defined as having a useful life of at least one year, having an acquisition unit cost of at least $5,000, and purchased with grant funds. Equipment means any products, objects, machinery, apparatus, implements, or tools purchased, used, or constructed within the project, including those products, objects, machinery, apparatus, implements or tools from which over thirty percent (30%) of the equipment is composed of materials purchased for the project. For purposes of determining depreciated value of equipment used in the Agreement, the project shall terminate at the end of the normal useful life of the equipment purchased, funded and/or developed with CEC funds. The CEC may determine the normal useful life of such equipment.
Title to equipment and any appliance acquired by the Recipient with grant funds shall vest in the Recipient, and the Recipient may transfer title to Retrofit Awardees. Title to equipment acquired by Retrofit Awardees with grant funds, if any, shall vest in the Retrofit Awardee. The Recipient shall use the equipment in the project or program for which it was acquired as long as needed, whether or not the project or program continues to be supported by grant funds, and the Recipient shall not encumber the property without CAM approval. When no longer needed for the original project or program, the Recipient shall contact the CAM for disposition instructions.
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The Recipient shall also flow to Retrofit Awardee any requirements developed in the Program Participation Agreements developed under the Scope of Work. The Recipient shall require Retrofit Awardee to comply with any limitations on equipment or appliance disposition provided in any lease addendum, deed recording, or other document provided by the Recipient.
11. Termination
This project may be terminated for any reason set forth below.
With Cause
The CEC may, for cause, terminate this Agreement upon giving five (5) calendar days advance written notice to the Recipient. In this event, the Recipient will use all reasonable efforts to mitigate its expenses and obligations.
The term “for cause” includes but is not limited to the following:
• Reorganization to a business entity unsatisfactory to the CEC; • Retention or hiring of subcontractors, or replacement or addition of personnel, that fail to perform to the standards and requirements of this Agreement;
• The Recipient’s inability to pay its debts as they become due and/or the Recipient’s default of an obligation that impacts its ability to perform under this Agreement; or
• Significant change in state or CEC policy such that the work or product being funded would not be supported by the CEC.
Without Cause
The CEC may terminate this Agreement without cause upon giving thirty (30) days advance written notice to the Recipient. In this event, the Recipient will use all reasonable efforts to mitigate its expenses and obligations.
If this Agreement is terminated with or without cause, the CEC reserves the right to transfer this project to another Equitable Building Decarbonization regional administrator and Recipient will use good faith efforts to take steps to effectuate the transfer.
12. Stop Work
CEC staff may, at any time, by written notice to Recipient, require Recipient to stop all or any part of the work tasks in this Agreement. Stop work orders may be issued for reasons such as a project exceeding budget, standard of performance, out of scope work, delay in project schedule, misrepresentations and the like.
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a. Compliance. Upon receipt of such a stop work order, Recipient shall immediately take all necessary steps to comply therewith and to stop the incurrence of costs allocable to the CEC.
b. Canceling a Stop Work Order. Recipient shall resume the work only upon receipt of written instructions from CEC staff.
13. Travel and Per Diem
a. The Recipient shall be reimbursed for travel and per diem expenses using the same rates provided to non-represented State employees, subject to any state-wide prohibition on travel. The Recipient must pay for travel in excess of these rates. The Recipient may obtain current rates from the CEC’s website at:
http://www.energy.ca.gov/contracts/TRAVEL_PER_DIEM.PDF. b. For purposes of payment, Recipient's headquarters shall be considered the location of the Recipient's office where the employees’ assigned responsibilities for this award are permanently assigned. c. Travel identified in the Budget section of this Agreement is approved and does not require further authorization.
d. Travel that is not included in the Budget section of this Agreement shall require written authorization from the CAM and CAO prior to travel departure. The CEC will reimburse travel expenses from the Recipient's office location.
e. The Recipient must retain documentation of travel expenses in its financial records. The documentation must be listed by trip and include dates and times of departure and return, departure city, and destination city. Travel receipts, including for travel meals and incidentals, shall be submitted with payment requests requesting reimbursement from the CEC.
14.Standard of Performance
Recipient, its subcontractors, and their employees, in the performance of Recipient's work under this Agreement shall be responsible for exercising the degree of skill and care required by customarily accepted good professional practices and procedures used in the Recipient’s field.
Any costs for failure to meet the foregoing standard or to correct otherwise defective work that requires re-performance of the work, as directed by CAM, shall be borne in total by Recipient and not the CEC.
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It is the Recipient's duty to ensure that CEC funds are not misspent by subcontractors or misused by Retrofit Awardees. For example, Recipient must ensure CEC funds are used to reimburse or otherwise pay for allowable costs that are actually incurred. This includes that it is the Recipient's duty to develop internal controls to detect fraud, waste, and abuse.
In the event Recipient/subcontractor fails to perform in accordance with the above standard:
a. Recipient/subcontractor will re-perform, at its own expense, any task which was not performed to the reasonable satisfaction of the CAM. Any work re-performed pursuant to this paragraph shall be completed within the time limitations originally set forth for the specific task involved.
Recipient/subcontractor shall work any overtime required to meet the deadline for the task at no additional cost to the CEC; b. The CEC shall provide a new schedule for the re-performance of any task pursuant to this paragraph in the event that re-performance of a task within the original time limitations is not feasible; and
c. The CEC shall have the option to direct Recipient/subcontractor not to re-perform any task which was not performed to the reasonable satisfaction of the CAM pursuant to application of (a) and (b) above. In the event the CEC directs Recipient/subcontractor not to re-perform a task, the CEC and Recipient shall negotiate a reasonable settlement for satisfactory work performed. No previous payment shall be considered a waiver of the CEC's right to reimbursement.
Nothing contained in this section is intended to limit any of the rights or remedies which the CEC may have under law.
15. Payment of Funds
a. Advance funds for Retrofit Awards
This Agreement is for the Recipient to administer a block grant program.
Under Public Resources Code section 25661(b) the CEC has authority to advance up to 25 percent of the clean energy program moneys allocated to recipients of a financial incentive, and Public Resources Code section 25660(c) confers block grant authority.
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Under this Agreement, the Recipient can request but is not guaranteed to receive advance funds for Retrofit Awards (i.e., incentives). Funds will not be advanced for other project expenditures. It is solely within the CEC’s discretion to allow advance funds. Because the CEC earns interest on the funds in its accounts, the CEC can lose interest if it advances funds long before Recipient actually pays out the funds (i.e., the funds sit in Recipient’s account instead of the CEC’s interest-earning account). The Recipient shall establish a separate ledger account or fund for receipt and disbursement of advance funds under this Agreement.
Accordingly, the Recipient, if allowed to receive advance funds for Retrofit Awards, shall take reasonable efforts to minimize the time between receiving advance funds and paying them out. The CEC can request at any time that the Recipient repay to the CEC any funds advanced to Recipient that the Recipient has not paid out, and the Recipient shall repay the unspent advanced funds within 10 days of receiving the CEC’s request.
The Recipient shall pay to the CEC any interest it earns on advanced funds that cumulatively total more than $200. This means over the life of this Agreement, if the Recipient cumulatively earns more than $200 on advanced funds, any additional interest amounts after that shall be paid to the CEC.
Alternatively, the CEC in its sole discretion, can instead subtract the interest amount over $200 from the amount paid to Recipient as requested in Recipient’s future invoices.
In addition to other documentation the Recipient must provide under this Agreement, upon request by the CEC, the Recipient shall provide all documents related to advanced funds received and paid out and any interest earned on the funds.
b. Reimbursement for all other project expenditures
The CEC agrees to reimburse the Recipient for actual allowable expenditures incurred in accordance with the Budget. The rates in the Budget are rate caps, or the maximum amount allowed to be billed.
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The Recipient can only bill for actual expenses incurred at the Recipient’s actual rates not to exceed the rates specified in the Budget (e.g., direct labor rates, fringe benefit rates, and indirect rates). For example, if the Budget includes an employee’s hourly rate of $50/hour but the employee is only paid $40/hour, the Recipient can only bill for $40/hour. Under the same example, if the employee earned $70/hour but the Budget only lists $50/hour, the Recipient can only bill for $50. Another example is if the maximum fringe benefit rate listed in the Budget is 20% but the Recipient’s actual fringe benefit rate is only 15%, the Recipient can only bill at 15%. The actual rates (e.g., direct labor rates, fringe benefit rates, and indirect rates) should not exceed the approved rates in the Budget.
(1) Payment Requests
The Recipient may request payment from the CEC no more frequently than monthly. The final payment request must be received by the CEC along with the Final Report 60 days prior to the end of the Agreement term.
Payments will generally be made on a reimbursement basis for Recipient expenditures, i.e., after the Recipient has incurred the cost for a service, product, supplies, or other approved budget item. No reimbursement for food or beverages shall be made other than allowable per diem charges.
Funds in this Agreement have a limited period in which they must be expended. All Recipient expenditures must occur within the approved term of this Agreement.
(2) Documentation
All payment requests must be submitted using a completed Payment Request form and emailed to [email protected]. This form must be accompanied by an itemized list of all charges and copies of all receipts or invoices necessary to document these charges for the CEC, including backup documentation for actual expenditures, such as timecards, vendor invoices, and proof of payment. Any payment request that is submitted without the itemization will not be authorized.
If the itemization or documentation is incomplete, inadequate, or inaccurate, the CAM will inform the Recipient via a Dispute Notification Form (Std. 209) and hold the invoice until all required information is received or corrected. Any penalties imposed on the Recipient by a subcontractor because of delays in payment will be paid by the Recipient.
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Any documentation in foreign currency must be converted to dollars, and the conversion rate must be included in your itemization. (3) Certification
The following certification shall be included on each Payment Request form and signed by the Recipient’s authorized officer:
I certify that this invoice is correct and proper for
payment, and reimbursement for these costs has not
and will not be received from any other sources,
including but not limited to a government entity
contract, subcontract, or other procurement method.
Additional certification is required related to the payment of prevailing wages. Refer to Sections 20 and 23 of these terms and conditions for more information.
(4) Government Entity
Government Entity is defined as a governmental agency from California or any state or a state college or state university from California or any state; a local government entity or agency, including those created as a Joint Powers Authority; an auxiliary organization of the California State University or a California community college; the Federal Government; a foundation organized to support the Board of Governors of the California Community Colleges or an auxiliary organization of the Student Aid Commission established under Education Code 69522.
(5) Release of Funds
The CAM will not process any payment request during the Agreement term until the following conditions have been met:
• All required reports have been submitted and are satisfactory to the CAM.
• All applicable special conditions have been met.
• All appropriate permits or permit waivers from governmental agencies have been issued to the Recipient and copies have been received by the CAM.
• All products due have been submitted and are satisfactory to the CAM.
• Other prepayment conditions as may be required by the CAM have been met. Such conditions will be specified in writing ahead of time, if possible.
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(6) Fringe Benefits, Indirect Overhead, and General and Administrative (G&A)
Indirect cost rates must be developed in accordance with generally accepted accounting principles. If the Recipient has an approved fringe benefits or indirect cost rate (indirect overhead or G&A) from their cognizant Federal Agency, the Recipient may bill at the federal rate up to the Budget rate caps if the following conditions are met:
• The Recipient may bill at the federal provisional rate but must adjust annually to reflect their actual final rates for the year in accordance with the Labor, Fringe, and Indirect Invoicing Instructions which can be accessed in this agreement.
• The cost pools used to develop the federal rates must be allocable to the CEC Agreement, and the rates must be representative of the portion of costs benefiting the CEC Agreement. For example, if the federal rate is for manufacturing overhead at the Recipient’s manufacturing facility and the CEC Agreement is for research and development at their research facility, the federal indirect overhead rate would not be applicable to the CEC Agreement. • The federal rate must be adjusted to exclude any costs that are specifically prohibited in the CEC Agreement.
• The Recipient may only bill up to the Agreement Budget rate caps unless and until an amendment to the Agreement Budget is approved.
(7) Retention
It is the CEC's policy to retain 10 percent of any payment request or 10 percent of the total CEC award until the end of the project. After the project is complete the Recipient must submit a completed payment request form requesting release of the retention. The CAM will review the project file and, when satisfied that the terms of the funding Agreement have been fulfilled, will authorize release of the retention.
Retention shall only be held for administrative costs.
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The CEC may choose to release retention on an annual basis, if the Recipient’s performance and completion of products and activities over the course of the year in question (referred to herein as a Retention Year) is determined by the CAM to be satisfactory. The Retention Year shall align with the reporting period for the Recipient’s Annual Reports. After the completion of a Retention Year and submission of the associated Annual Report, the Recipient may submit a completed payment request form requesting release of retention pursuant to this paragraph.
(8) State Controller’s Office
Payments are made by the State Controller’s Office.
16. Fiscal Accounting Requirements
a. Accounting and Financial Methods
The Recipient shall establish a separate ledger account or fund for receipt and disbursement of CEC funds for each project funded by the CEC. Expenditure details must be maintained in accordance with the approved budget details using appropriate accounting practices.
b. Retention of Records
The Recipient shall retain all project records (including financial records, progress reports, and payment requests) for a minimum of three (3) years after the final payment has been received or five (5) years after the state grant term, whichever is later, unless otherwise specified in the funding Agreement.
Records for nonexpendable personal property acquired with grant funds shall be retained for five years after its final disposition or five years after the state grant term, whichever is later.
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c. Audits
Upon written request from the CEC, the Recipient shall provide detailed documentation of all expenses at any time throughout the project. In addition, the Recipient agrees to allow the CEC or any other agency of the State, or their designated representative, upon written request, to have reasonable access to and the right of inspection of all records that pertain to the project during the term of this Agreement and for a period of three (3) years thereafter or three years after the federal grant term, whichever is later, unless the CEC notifies the Recipient, prior to the expiration of such three-year period, that a longer period of record retention is necessary. Further, the Recipient agrees to incorporate an audit of this project within any scheduled audits, when specifically requested by the State. Recipient agrees to include a similar right to audit in any subcontract.
Recipients are strongly encouraged to conduct annual audits in accordance with the single audit concept. The Recipient should provide two copies of the independent audit report and any resulting comments and correspondence to the CAM within 30 days of the completion of such audits.
17. Indemnification
The Recipient agrees to indemnify, defend, and save harmless the State, its officers, agents, and employees from any and all claims and losses accruing or resulting to Recipient, the CEC, and to any and all contractors, subcontractors, Retrofit Awardees, vendors, materialmen, laborers, and any other person, firm, or corporation furnishing or supplying work, services, materials, or supplies in connection with the performance of this Agreement, and from any and all claims and losses accruing or resulting to any person, firm, or corporation who may be injured or damaged by the Recipient in the performance of this Agreement.
This includes repayment to CEC for funds advanced which were not spent, either by the Recipient or a subcontractor, in accordance with the terms of this Agreement.
18. Workers' Compensation Insurance
a. Recipient hereby warrants that it carries Worker's Compensation Insurance for all of its employees who will be engaged in the performance of this Agreement, and agrees to furnish to the CAM satisfactory evidence of this insurance at any time the CAM may request.
b. If Recipient is self-insured for worker's compensation, it hereby warrants such self-insurance is permissible under the laws of the State of California and agrees to furnish to the CAM satisfactory evidence of this insurance at any time the CAM may request.
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19. General Provisions
a. Governing Law
It is hereby understood and agreed that this Agreement shall be governed by the laws of the State of California as to interpretation and performance. b. Independent Capacity
The Recipient, and the agents and employees of the Recipient, in the performance of this Agreement, shall act in an independent capacity and not as officers or employees or agents of the CEC.
c. Assignment
Without the written consent of the CEC in the form of a formal written amendment, this Agreement is not assignable or transferable by Recipient either in whole or in part.
d. Timeliness
Time is of the essence in this Agreement.
e. Unenforceable Provision
In the event that any provision of this Agreement is unenforceable or held to be unenforceable, then the parties agree that all other provisions of this Agreement have force and effect and shall not be affected thereby. f. Waiver
No waiver of any breach of this Agreement shall be held to be a waiver of any other or subsequent breach. All remedies afforded in this Agreement shall be taken and construed as cumulative, that is, in addition to every other remedy provided therein or by law.
g. Assurances
The CEC reserves the right to seek further written assurances from the Recipient and its team that the work of the project under this Agreement will be performed consistent with the terms of the Agreement. h. Change in Business
(1) Recipient shall promptly notify the CEC of the occurrence of each of the following:
(a) A change of address.
(b) A change in the business name or ownership.
(c) The existence of any litigation or other legal proceeding affecting the Project.
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(d) The occurrence of any casualty or other loss to Project personnel, equipment or third parties of a type commonly covered by insurance.
(e) Receipt of notice of any claim or potential claim against Recipient for patent, copyright, trademark, service mark and/or trade secret infringement that could affect the CEC’s rights. (2) Recipient shall not change or reorganize the type of business entity under which it does business except upon prior written notification to the CEC. A change of business entity or name change requires an amendment assigning or novating the Agreement to the changed entity. In the event the CEC is not satisfied that the new entity can perform as the original Recipient, the CEC may terminate this Agreement as provided in the termination paragraph.
i. Survival of Terms
It is understood and agreed that certain provisions shall survive the completion or termination date of this Agreement for any reason. The provisions include, but are not limited to:
• Publications - Legal Statement on Reports and Products (Section 5) • Equipment (Section 10)
• Termination (Section 11)
• Payment of Funds (Section 15)
• Fiscal Accounting Requirements (Section 16)
• Indemnification (Section 17)
• Change in Business (Section 19.h)
• Intellectual Property (Section 24)
20. Certifications and Compliance
Federal, State and Municipal Requirements
Recipient must obtain any required permits and shall comply with all applicable federal, State, and municipal laws, rules, codes, and regulations for work performed under this Agreement.
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Nondiscrimination Statement of Compliance
During the performance of this Agreement, Recipient and its subcontractors shall not unlawfully discriminate, harass, or allow harassment, against any employee or applicant for employment because of sex, sexual orientation, race, color, ancestry, religious creed, national origin, disability (including HIV and AIDS), medical condition (cancer), age, marital status, and denial of family care leave. Recipient and its subcontractors shall insure that the evaluation and treatment of their employees and applicants for employment are free of such discrimination and harassment. Recipient and its subcontractors shall comply with the provisions of the Fair Employment and Housing Act (Government Code sections 12990 et seq.) and the applicable regulations promulgated thereunder (CCR, Title 2, section 11000 et seq.).
The applicable regulations of the Fair Employment and Housing Commission implementing Government Code section 12990 (a-f), set forth in Chapter 5 of Division 4.1 of Title 2 of the CCR are incorporated into this Agreement by reference and made a part of it as if set forth in full. Recipient and its subcontractors shall give written notice of their obligations under this clause to labor organizations with which they have a collective bargaining or other Agreement.
The Recipient shall include the nondiscrimination and compliance provisions of this clause in all subcontracts to perform work under this Agreement.
Drug-Free Workplace Certification
By signing this Agreement, the Recipient hereby certifies under penalty of perjury under the laws of the State of California that the Recipient will comply with the requirements of the Drug-Free Workplace Act of 1990 (Government Code section 8350 et seq.) and will provide a drug-free workplace by taking the following actions:
(1) Publish a statement notifying employees that unlawful manufacture, distribution, dispensation, possession, or use of a controlled substance is prohibited and specifying actions to be taken against employees for violations as required by Government Code section 8355(a)(1).
(2) Establish a Drug-Free Awareness Program as required by Government Code section 8355(a)(2) to inform employees about all of the following:
• The dangers of drug abuse in the workplace;
• The person's or organization's policy of maintaining a drug-free workplace;
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• Any available counseling, rehabilitation, and employee assistance programs; and
• Penalties that may be imposed upon employees for drug abuse violations.
(3) Provide, as required by Government Code section 8355(a)(3), that every employee who works on the proposed project:
• Will receive a copy of the company's drug-free policy statement; • Will agree to abide by the terms of the company's statement as a condition of employment on the project.
Failure to comply with these requirements may result in suspension of payments under the Agreement or termination of the Agreement or both, and the Recipient may be ineligible for any future State awards if the CEC determines that any of the following has occurred: (1) the Recipient has made false certification, or (2) violates the certification by failing to carry out the requirements as noted above.
d. Child Support Compliance Act (Applicable to California Employers) For any Agreement in excess of $100,000, the Recipient acknowledges that:
• It recognizes the importance of child and family support obligations and shall fully comply with all applicable state and federal laws relating to child and family support enforcement, including, but not limited to, disclosure of information and compliance with earnings assignment orders, as provided in Chapter 8 (commencing with section 5200) of Part 5 of Division 9 of the Family Code; and • To the best of its knowledge is fully complying with the earnings assignment orders of all employees and is providing the names of all new employees to the New Hire Registry maintained by the California Employment Development Department.
e. Americans with Disabilities Act
By signing this Agreement, Recipient assures the State that it complies with the Americans with Disabilities Act (ADA) of 1990 (42 U.S.C. 12101, et seq.), which prohibits discrimination on the basis of disability, as well as applicable regulations and guidelines issued pursuant to the ADA.
f. Air or Water Pollution Violation
Under state laws, the Recipient will not be:
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(1) In violation of any order or resolution not subject to review promulgated by the State Air Resources Board or an air pollution control district;
(2) Subject to a cease-and-desist order not subject to review issued pursuant to section 13301 of the Water Code for violation of waste discharge requirements or discharge prohibitions; or
(3) Finally determined to be in violation of provisions of federal law relating to air or water pollution.
g. National Labor Relations Board Certification (Not applicable to public entities) The Recipient, by signing this Agreement, swears under penalty of perjury that no more than one final unappealable finding of contempt of court by a federal court has been issued against the Recipient within the immediately preceding two-year period because of the Recipient's failure to comply with an order of a federal court that orders the Recipient to comply with an order of the National Labor Relations Board.
21. Site Visits
The CEC and/or its designees have the right to make site visits at reasonable times to review project accomplishments and management control systems and to provide technical assistance, if required. Recipient must provide and must require subcontractors and Retrofit Awardees to provide reasonable facilities and assistance for the safety and convenience of the government representatives in the performance of their duties. All site visits and evaluations must be performed in a manner that does not unduly interfere with or delay the work.
22. Budget Contingency Clause
It is mutually agreed that this Agreement shall be of no further force and effect if the Budget Act of the current year and/or any subsequent years covered under this Agreement does not appropriate sufficient funds for the work identified in the Scope of Work. In this event, the CEC shall have no liability to pay any funds whatsoever to the Recipient or to furnish any other consideration under this Agreement, and the Recipient shall not be obligated to perform any provisions of this Agreement.
If funding for any fiscal year is reduced or deleted by the Budget Act for purposes of this program, the CEC shall have the option to either: 1) cancel this Agreement with no liability occurring to the CEC; or 2) offer an Agreement Amendment to the Recipient to reflect the reduced amount.
23. Public Works -- Payment of Prevailing Wages
Generally Required by Law
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Projects that receive an award of public funds from the CEC often involve construction, alteration, demolition, installation, repair, or maintenance work over $1,000.
NOTE: Projects that receive an award of public funds from the CEC are likely to be considered public works under the California Labor Code. See Chapter 1 of Part 7 of Division 2 of the California Labor Code, commencing with section 1720 and Title 8, CCR, Chapter 8, Subchapter 3, commencing with section 16000.
Accordingly, the CEC assumes that all projects it funds are public works. Projects deemed to be public works require among other things the payment of prevailing wages.
NOTE: Prevailing wage rates can be significantly higher than non-prevailing wage rates.
By accepting this Agreement, Recipient as a material term of this Agreement shall be fully responsible for complying with all California public works requirements including but not limited to payment of prevailing wage. Public Resources Code section 25665.3(f) provides that “[p]rojects funded pursuant the [Equitable Building Decarbonization] direct install program shall be performed by workers paid prevailing wage where possible and when applicable.” Therefore, as a material term of this Agreement, Recipient must either:
(a) Proceed on the assumption that the project is a public work and ensure that:
(i) prevailing wages are paid; and
(ii) the project budget for labor reflects these prevailing wage requirements; and
(iii) the project complies with all other requirements of prevailing wage law including but not limited to keeping accurate payroll records, and complying with all working hour requirements and
apprenticeship obligations;
or,
(b) Timely obtain a legally binding determination from the California Department of Industrial Relations (DIR) or a court of competent jurisdiction before work begins on the project that the proposed project is not a public work.
NOTE: Only the DIR and courts of competent jurisdiction have jurisdiction to issue legally binding determinations that a particular project is or is not a public work.
If the Recipient is unsure whether the project receiving this award is a “public work” as defined in the California Labor Code, it may wish to seek a timely determination from the DIR or an appropriate court.
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NOTE: Such processes can be time consuming and therefore it may not be possible to obtain a timely determination before the date for performance of the award commences.
If the Recipient does not timely obtain a binding determination from DIR or a court of competent jurisdiction that the project is not a public work, before this Agreement from the CEC is executed, the Recipient shall assume that the project is a public work and that payment of prevailing wages is required and shall pay prevailing wages unless and until such time as the project is subsequently determined to not be a public work by DIR or a court of competent jurisdiction.
NOTE: California Prevailing Wage law provides for substantial damages and financial penalties for failure to pay prevailing wages when payment of prevailing wages is required.
Subcontractors and Flow-down Requirements. Recipient shall ensure that its subcontractors, if any, also comply with above requirements with respect to public works/prevailing wage. Recipient shall ensure that all agreements with its contractors/subcontractors to perform work related to this project contain the above terms regarding payment of prevailing wages on public works projects.
Recipient shall be responsible for any failure of Recipient’s subcontractors to comply with California prevailing wage and public works laws.
Indemnification and Breach. Any failure of Recipient or its subcontractors to comply with the above requirements shall constitute a breach of this Agreement that excuses the CEC’s performance of this Agreement at the CEC’s option, and shall be at Recipient’s sole risk. In such a case, CEC may refuse payment to Recipient of any amount under this Agreement and CEC shall be released, at its option, from any further performance of this award or any portion thereof. By accepting this Agreement, and as a material term of this Agreement, Recipient agrees to indemnify the CEC and hold the CEC harmless for any and all financial consequences arising out of or resulting from the failure of Recipient and/or any of Recipient’s subcontractors to pay prevailing wages or to otherwise comply with the requirements of prevailing wage law.
Budget. Recipient’s budget and subcontractors’ budgets on public works projects must indicate which job classifications are subject to prevailing wage. For detailed information about prevailing wage and the process to determine if the proposed project is a public work, Recipient may wish to contact the DIR or a qualified labor attorney of their choice for guidance.
Covered Trades. For public works projects, Recipient may contact DIR for a list of covered trades and the applicable prevailing wage.
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Questions. If Recipient has any questions about this contractual requirement or the wage, record keeping, apprenticeship or other significant requirements of California prevailing wage law, it is recommended that Recipient consult DIR and/or a qualified labor attorney of its choice before accepting this Agreement.
Certification. Recipient shall certify to the CEC on each Payment Request Form, either that (1) prevailing wages were paid to eligible workers who provided labor for work covered by the payment request and that the Recipient and all contractors and subcontractors otherwise complied with all California prevailing wage laws, or (2) that the project is not a public work requiring the payment of prevailing wages.
In the latter case, Recipient shall provide competent proof of a DIR or court determination that the project is not a public work requiring the payment of prevailing wages.
Prior to the release of any retained funds under this Agreement, the Recipient shall submit to the CEC the above-described certificate signed by the Recipient and all contractors and subcontractors performing public works activities on the project.
Absent such certificate, Recipient shall have no right to any funds under this Agreement, and CEC shall be relieved of any obligation to pay said funds.
24. Intellectual Property
a. The CEC makes no claim to “intellectual property” developed under this Agreement except as expressly provided herein.
b. “Intellectual property” means: (a) inventions, technologies, designs, drawings, software, formulas, compositions, processes, techniques, works of authorship, trademarks, service marks, and logos that are created, conceived, discovered, made, developed, altered, or reduced to practice with Agreement or match funds during or after the Agreement term; (b) any associated proprietary rights to these items, such as patent and copyright; and (c) any upgrades or revisions to these items. “Product” means any tangible item specified for delivery to the CEC in the Scope of Work.
“Works of authorship” does not include written products created for Agreement reporting and management purposes, such as reports, summaries, lists, letters, agendas, schedules, and invoices. c. The CEC owns all products identified in the Scope of Work, with the exception of products that fall within the definition of “intellectual property.” d. The CEC has a no-cost, non-exclusive, transferable, irrevocable, royalty-free, worldwide, perpetual license to use, publish, translate, modify, and reproduce intellectual property for governmental purposes, including but not limited to providing data and reports to other government entities, state
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legislature, and utility companies and using data for the development of future programs.
e. The Recipient may not, in supplying work under this Agreement, knowingly infringe or misappropriate any intellectual property right of a third party and will take reasonable actions to avoid infringement.
To the extent allowed under California law, the Recipient will defend and indemnify the CEC from and against any claim, lawsuit, or other proceeding, loss, cost, liability, or expense (including court costs and reasonable fees of attorneys and other professionals) to the extent arising out of: (i) any third party claim that a product infringes any patent, copyright, trade secret, or other intellectual property right of any third party; or (ii) any third party claim arising out of the negligent or other tortious acts or omissions by the Recipient or its employees, subcontractors, or agents in connection with or related to the products or the Recipient’s performance under this Agreement.
25. CEC Remedies for Recipient’s Non-Compliance
Without limiting any of its other remedies, the CEC may, for Recipient’s noncompliance of any Agreement requirement, withhold future payments, demand and be entitled to repayment of past reimbursements, or suspend or terminate this Agreement. The tasks in the Scope of Work are non-severable, and completion of all of them is material to this Agreement. Thus, the CEC, without limiting its other remedies, is entitled to repayment of all funds paid to Recipient if the Recipient does not timely complete all tasks in the Scope of Work. These remedies will also be flowed down to Retrofit Awardees in the event of breach of their Program Participation Agreements.
Further, if any penalty, fine, or other assessment is issued against the CEC or the CEC and other parties as a result of the Recipient’s, its subcontractors’, or a Retrofit Awardee’s failure to comply with the Agreement requirements, the Recipient shall pay all assessment amounts with its own, non-grant funds, including any assessment against the CEC. Should the Recipient fail to pay the penalty, fine, or other assessment, the Recipient acknowledges that such monies may be paid out of retention.
26. Enforcement
a. Recovery of Overpayment or Misuse of Funds
The CEC may direct the CEC’s Office of Chief Counsel to commence formal legal action against any applicant or Recipient to recover any portion of a payment under the Agreement that the Executive Director determines the applicant or Recipient was not otherwise entitled to receive. b. Fraud and Misrepresentation
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The Executive Director may initiate an investigation of any applicant, Recipient, subcontractor, vendor, or Retrofit Awardee that the Executive Director has reason to believe may have misstated, falsified, or misrepresented information in submitting an application, payment claim, or reporting any information required by the Agreement. Based on the results of the investigation, the Executive Director may take any action deemed appropriate, including, but not limited to, termination of the Agreement, recovery of any overpayment, and, with the concurrence of the CEC, recommending the Attorney General initiate an investigation and prosecution under Government Code section 12650, et seq., or other provisions of law.
27. Confidential Recipient Information
a. Identification of Confidential Recipient Information (1) For the purposes of this Section, “Confidential Recipient Information” refers to information belonging to the Recipient that the Recipient has satisfactorily identified as confidential and the CEC has agreed to designate as confidential under Title 20 CCR section 2505. (2) Prior to the effective date of this Agreement, the Recipient will identify all products (or information contained within products) it considers Confidential Recipient Information, and provide the legal basis for confidentiality, in Attachment 1 to this Exhibit. If the CEC agrees the information is confidential, it will not disclose it except as provided in subsection (b).
(3) During the Agreement, if the Recipient obtains or develops additional products (or information contained within products) not originally identified as Confidential Recipient Information in Attachment 1 to this Exhibit, the Recipient will follow the procedures for a request for designation of confidential information as specified in Title 20 CCR section 2505.
The CEC’s Executive Director will make the confidentiality determination. Such subsequent determinations may be added to the list of confidential deliverables in the Attachment 1 to this Exhibit.
The CEC will not disclose information subject to an application for confidential designation except as provided in subsection (b). (4) When submitting products containing Confidential Recipient Information, the Recipient will mark each page of any document containing Confidential Recipient Information as “confidential” and present it in a sealed package to the Contracts, Grants, and Loans Office.
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The CAM may require the Recipient to submit a non-confidential version of the product if it is feasible to separate the Confidential Recipient Information from the non-confidential information. The Recipient is not required to submit such products in a sealed package. b. Disclosure of Confidential Recipient Information
The CEC will only disclose Confidential Recipient Information under the circumstances specified in Title 20 CCR sections 2506, 2507, and 2508. All Confidential Recipient Information that is legally disclosed by the Recipient or any other entity will become a public record and will no longer be subject to the CEC’s confidentiality designation.
c. Waiver of Consequential Damages
In no event will the CEC or the state of California be liable for any special, incidental, or consequential damages based on breach of warranty, breach of contract, negligence, strict tort, or any other legal theory for the disclosure of the Confidential Recipient Information, even if the CEC has been advised of the possibility of such damages.
Damages that the CEC and the state of California will not be responsible for include but are not limited to lost profit; lost savings or revenue; lost goodwill; lost use of the product or any associated equipment; cost of capital; cost of any substitute equipment, facilities, or services; downtime; the claims of third parties including customers; and injury to property. d. Limitations on the Disclosure of Products
During the Agreement, the Recipient, subcontractors, any lower-tiered level of sub-subcontractors, and Vendors must receive written approval from the CAM prior to disclosing the contents of any draft product to a third party.
However, if the CEC makes a public statement about the content of any product provided by the Recipient and the Recipient believes the statement is incorrect, the Recipient may state publicly what it believes is correct.
28. Receipt of Confidential Information and Personal Information For the purposes of this Section, “confidential information” refers to information the CEC has designated as confidential pursuant to Title 20 CCR section 2505 et seq., information the CEC has otherwise deemed or stated to be confidential, and other information exempt from public disclosure under the provisions of the California Public Records Act or other applicable state or federal laws.
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For the purposes of this Section, “personal information” refers to information that meets the definition of “personal information” in California Civil Code section 1798.3(a) or one of the data elements set forth in California Civil Code section 1798.29(g)(1) or (g)(2). Personal information is a type of confidential information and is therefore subject to all requirements for confidential information provided in this Agreement and applicable law. However, there are additional requirements specific to personal information.
For the purposes of this Section, “special terms for confidential information” refers to the CEC’s special terms and conditions for the receipt of confidential information and personal information. The CEC’s special terms for confidential information include, but are not limited to, having in place an Information Security Program Plan, and obtaining nondisclosure agreements from all individuals who will be provided access to confidential information or personal information.
If the Recipient will receive confidential information or personal information from the CEC or a third-party for the performance of this Agreement, the Recipient must first agree to and comply with the CEC’s special terms for confidential information.
If any other individual or entity participating in any way with this Agreement, including but not limited to subcontractors, Retrofit Awardees, vendors, and other project partners, will receive confidential information or personal information from the CEC or a third-party for the performance of this Agreement, that individual or entity must first agree to and comply with the CEC’s special terms for confidential information. The Recipient must flow-down the CEC’s special terms for confidential information into each subcontract, Retrofit Award, vendor agreement, or other project partner agreement that will be provided access to confidential information or personal information before the individual or entity has access to any such information. Recipient must also require all individuals and entities to flow-down this Section to any lower tier subcontractors, Retrofit Awardees, vendors, project partners, and other individual or entity participating in any way with this Agreement that will be provided access to Confidential Information or Personal Information before the individual or entity has access to any such information.
If this Agreement does not include the CEC’s special terms for confidential information and CEC determines the Recipient or any other individual or entity participating in any way with this Agreement will receive confidential information or personal information from the CEC or a third-party for the performance of this Agreement, the CEC reserves the option to amend this Agreement to add its special terms for confidential information.
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Except as provided in Title 20 CCR sections 2506, 2507, and 2508, and the CEC’s special terms for confidential information, Recipient or any other individual or entity participating in any way with this Agreement may not disclose any information provided to it by the CEC or a third party for the performance of this Agreement if the information has been designated as confidential or is the subject of a pending application for confidential designation.
29. Executive Order N-6-22 – Russia Sanctions
On March 4, 2022, Governor Gavin Newsom issued Executive Order N-6-22 (the EO) regarding Economic Sanctions against Russia and Russian entities and individuals. “Economic Sanctions” refers to sanctions imposed by the U.S. government in response to Russia’s actions in Ukraine, as well as any sanctions imposed under state law. The EO directs state agencies to terminate agreements with, and to refrain from entering any new agreements with, individuals or entities that are determined to be a target of Economic Sanctions. Accordingly, should the State determine the Recipient is a target of Economic Sanctions or is conducting prohibited transactions with sanctioned individuals or entities, that shall be grounds for termination of this agreement. The State shall provide the Recipient advance written notice of such termination, allowing the Recipient at least 30 calendar days to provide a written response. Termination shall be at the sole discretion of the CEC.
30. Greenhouse Gas Reduction Fund Requirements
a. This Agreement is funded in part by the Greenhouse Gas Reduction Fund (GGRF) created pursuant to Government Code section 16428.8. This Agreement is subject to, and Recipient shall comply with, the provisions of the laws enacted for spending of auction proceeds deposited into the GGRF, including without limitation: Health and Safety Code section 39710 et. seq.; Government Code section 16428.8 – 16428.95, including any amendments to these sections. In addition to GGRF reporting requirements, Recipients will be responsible for other reporting requirements as outlined in the Scope of Work and specified by the CAM.
b. Reporting
Recipients of GGRF funds must submit reports on expenditures, investment benefits, and project outcomes, per guidance from the California Air Resources Board (CARB). Recipient shall provide reports on all projects during the term of this Agreement and for a period specified by CARB to meet project outcome reporting requirements.
Reporting shall follow the technical standards, format, process, and timing specified by the CAM, consistent with the project-type specific reporting requirements in CARB guidance and methodologies. Information to be reported includes, but is not limited to:
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(1) Greenhouse Gas (GHG) Reductions
• Recipient Name or Project ID
• Project description
• Project location
• Census tract
• Project Stages and Dates for Reaching Milestones: Project Selected; Completed; Operational; GHG reductions began
• GGRF dollars allocated and total project cost including GGRF and non-GGRF monies
• Leveraged and/or match funds
• Quantification Period (number of years the project will provide GHG emission reductions)
• Number of projects/incentives/dwellings modified
• Estimated /actual total project GHG emission reductions • Other information as specified by the CAM and in accordance with CARB requirements
(2) Priority Populations
Recipient reporting shall include information regarding benefits to priority populations, consistent with the detailed information in the CARB guidance which is posted at www.arb.ca.gov/cci-quantification. Recipient reporting shall include any information needed to evaluate, using the appropriate Benefit Criteria Table, whether the project has a direct benefit to priority populations. “Priority populations” include residents of: (A) census tracts identified as disadvantaged by California Environmental Protection Agency per SB 535; (B) census tracts identified as low-income per AB 1550; or (C) a low-income household per AB 1550.
(3) Co-Benefits
Recipient reporting shall include each project’s economic, environmental, or public health benefits, including, but not limited to:
• Estimated /actual total reductions in other criteria air pollutants (PM 2.5, NOx, etc.)
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34 Terms and Conditions Page D-34 of 35 GFO-23-404
April 2024 EBD Direct Install Program
• Estimated /actual energy and fuel costs saved (kWh, therms, or other fuels) for energy efficiency and electrification projects
• Other information as specified by the CAM and in accordance with CARB requirements.
(4) Job Creation Benefits
Recipient reporting shall include data related to the number of job-years provided, average wages and benefits, the number of people who completed job training or received industry-recognized certifications, targeted hiring strategy and residence location of job/training recipients, as specified by the CAM and in accordance with CARB requirements.
31.Conflicts of Interest
a. Recipient agrees to continuously review new and upcoming projects in which Recipient, its subcontractors or other project partners may be involved for potential conflicts of interest (e.g., Gov. Code § 81000 et seq., and Gov. Code § 1090 et seq.). Recipient shall inform the CAM as soon as a question arises about whether a potential conflict may exist or as soon as the Recipient knows a conflict exists. The CAM and CEC’s Chief Counsel's Office shall determine what constitutes a potential conflict of interest. The CEC reserves the right to redirect work and funding on a project if the CEC’s Chief Counsel’s Office determines that there is a potential conflict of interest.
b. Appearances of Conflicts of Interest
The Recipient acknowledges that in governmental agreements even the appearance of a conflict of interest can be harmful to the interest of the State. Thus, the Recipient, its subcontractors and project partners shall refrain from any practices, activities, or relationships that appear to conflict with their obligations under this Agreement, unless the Recipient receives prior written approval of the CEC. In the event the Recipient is uncertain whether the appearance of a conflict of interest may exist, the Recipient shall submit to the CAM a written description of the relevant details. c. Prohibition on Participating in CEC Funding Opportunities Under this Agreement, the Recipient and its subcontractors and project partners will, with oversight from the CEC, develop and implement programs. Accordingly, the Recipient and its subcontractors and project partners are prohibited from participating and agree not to participate in any manner (e.g., as an applicant, subcontractor, or match-funding partner) in any financial incentive program implemented under this Agreement.
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April 2024 EBD Direct Install Program
d. Possible amendment of conflicts of interest provisions The Recipient acknowledges that, if amendments to this Agreement are made to develop and fund programs or otherwise expand the scope of work, the role of employees of the Recipient, subcontractors and project partners may become more defined. As those responsibilities and tasks are defined, the CAM and CEC’s Chief Counsel’s Office reserve the right to determine if it is appropriate to designate certain individuals who are participating in the making of government decisions as “consultants” under the Political Reform Act and therefore require the disclosure of economic interests pursuant to Government Code section 87300 and the CEC’s Conflict of Interest Code at CCR, Title 20, sections 2401-2402. Upon such determination, this Agreement shall be amended to include the specific procedural requirements applicable to the Recipient, subcontractors and project partners, and any designated consultants.
32. Disclosure.
The Recipient shall promptly inform the CEC when it is engaged by another State agency for work that is similar to a product under the scope of work contemplated in this Agreement. Where that similar work product or deliverable is applicable to this Agreement, the Recipient may use such work product or deliverable, but is barred from billing the CEC in this Agreement for the work performed under the other agreement and not actually performed under this Agreement. Where actual labor is expended to generate the same or similar work product or deliverable under this Agreement as another agreement, the Recipient is allowed to bill for such labor actually performed.
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i
Federal Terms and Conditions i GFO-23-404
April 2024 EBD Direct Install Program
ATTACHMENT E: RESERVED
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1 Federal Terms and Conditions Page E-1 of 20 GFO-23-404 April 2024 EBD Direct Install Program
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2 ATTACHMENT E
CEC INVOICE TEMPLATE
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Staff Report – Agenda Item 3
To: Board of Directors
From: Emily Andrews, Project Manager, Structured Contracts Reviewed by: John McNamara, Director, Structured Contracts Lindsay Descagnia, Vice President, Power Supply
Matthew Langer, Chief Operating Officer
Nancy Whang, General Counsel
Approved By: Ted Bardacke, Chief Executive Officer
Subject: Amendments to the Power Purchase Agreements with Solar Star 3, LLC and Solar Star 4, LLC
Date: September 4, 2025
RECOMMENDATION
Approve and authorize the Chief Executive Officer to execute the amendments to the Renewable Power Purchase Agreements with Solar Star 3, LLC and Solar Star 4, LLC, for the Solar Star solar and battery energy storage system projects.
BACKGROUND
On June 6, 2024, CPA and BHE Renewables (BHER) entered into 20-year Renewable Power Purchase Agreements (PPAs) for two identically sized projects, each consisting of 24 MW solar PV facilities paired with 23 MW of battery energy storage systems to help CPA meet its long-term renewable energy demand and Resource Adequacy (RA) obligations. These PPAs were the result of bilateral offers and were among the proposals approved for negotiations by the Energy Planning and Resource Committee on April 23, 2024.
The Solar Star projects were scheduled to come online on July 1, 2025 (Solar Star 3), and August 1, 2025 (Solar Star 4) but have experienced delays due to an outstanding permit with the Los Angeles Department of Water and Power (LADWP). BHER is working to finalize an agreement (Non-Objection Letter) with LADWP to cross the Second Los Agenda Page 74
Board of Directors Item 3
Angeles Aqueduct, which runs beneath BHER’s property. The site is at 90% completion pending execution of the Non-Objection Letter with LADWP. Due to these delays, BHER has requested amendments to the PPAs to adjust the Guaranteed Commercial Online Date (GCOD) to October 1, 2026 to accommodate the current construction schedule impacted by the pending permit.
PROPOSED PPA AMENDMENTS
The PPAs allow BHER to pay $54,833 per day for each project as Commercial Operation Delay Damages (COD Delay Damages) to extend the Guaranteed Commercial Operation Date (GCOD) up to an additional 90 days. BHER has already paid CPA a total of $9,870,000–or $4,935,000 per project—to extend the GCOD by the maximum 90 days (for Solar Star 3 from July 1, 2025 to September 28, 2025, and for Solar Star 4 from August 1, 2025 to October 30, 2025). BHER has now exhausted its ability to further extend the GCODs through payment of additional COD Delay Damages under the terms of the PPAs.
The proposed amendments to the PPAs extend the Guaranteed Commercial Operation Date (GCOD) to October 1, 2026 for both projects, with compensation for the COD Delay provided through the already made payment of $9,870,000. Had BHER been contractually able to pay additional per day COD Delay Damages to move the Solar Star Projects GCOD to October 1, 2026 – and in the unlikely event of choosing to do so – the total cost would have been $48,417,833.
In addition to the COD extension and payment of COD Delay Damages, the proposed amendments allow the parties to mutually agree to allow BHER to pay Additional COD Delay Damages if an extension beyond October 1, 2026 is needed. The amendments also ensure that BHER may not claim any further Development Cure Period delays under the PPAs, regardless of the circumstances, and therefore there are no more opportunities for any excused delays under the PPAs unless CPA and BHER negotiate a further delay.
In the event there is a delay to the newly proposed October 1, 2026 COD due to one or more Force Majeure Event(s) (“FM Event”), CPA must first agree that an FM Event has occurred and on the number of days that are attributable to that FM Event. If CPA agrees Agenda Page 75
Board of Directors Item 3
that there is an FM Event and if that event spans a total of 270 days, BHER would be entitled to the return of any Additional COD Delay Damages paid (e.g. not damages paid prior to and included in this amendment) and the return of its Development Security. CPA has similar language in its standard pro-forma agreement to help incentivize counterparties to make every effort to achieve COD should a Force Majeure Event occur.
The amendments also update provisions on RA shortfall language to conform with CPA’s latest pro-forma language and correct section reference formatting errors in the PPAs.
RATIONALE
The amendments to the PPAs will enable the projects to come online and help CPA meet its long-term renewable energy demand and RA obligations at competitive prices.
Together, the projects will deliver 48 MW of Renewable Portfolio Standard (RPS)- qualified energy and 46 MW of RA. These projects are already mechanically complete and are positioned to qualify for a 40% Investment Tax Credit (ITC) under the current agreements. With changes introduced by the recent federal budget legislation creating uncertainty around future renewable energy project eligibility for tax credits, CPA has seen immediate impacts such as higher project costs and increasing development risk for new projects. Amending the GCODs for the Solar Star Projects ensures CPA can secure these resources without additional exposure to cost volatility and uncertainty of future long-term procurement efforts that would be needed to replace these projects were they to be cancelled.
Without the amendments, BHER would be unable to come online in time to meet its current contractual obligations. In that case, CPA would be entitled to retain the Solar Star Projects’ Development Security which totals another $9,870,000, the contracts would be canceled, and CPA would need to acquire additional renewable energy and RA capacity in a higher cost and more risky market. Approval of the amendment allows CPA to collect $9,870,000 in COD Delay Damages and continue with two cost effective projects that are mature in their development stage and substantially derisked. As further protection against project failure, CPA continues to hold Solar Star Projects’ full Development Security.
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Board of Directors Item 3
Per CPA’s Energy Risk Management Policy, any amendments to Board-approved long-term contracts that result in material changes to the terms of the contract, such as the extension of the guaranteed commercial operation date greater than 12 months, require approval by the Board.
ATTACHMENTS
1. Amendment No. 1 to the Power Purchase Agreement with Solar Star 3, LLC
2. Amendment No. 1 to the Power Purchase Agreement with Solar Star 4, LLC Agenda Page 77
AMENDMENT NO. 1
to the
RENEWABLE POWER PURCHASE AGREEMENT
between
CLEAN POWER ALLIANCE OF SOUTHERN CALIFORNIA
and
SOLAR STAR 3, LLC
This Amendment No. 1 (“Amendment”) to the Agreement (as that term is defined below), dated as of September__, 2025 (the “Amendment Effective Date”), is entered between CLEAN POWER ALLIANCE OF SOUTHERN CALIFORNIA, a California joint powers authority (“Buyer”)), and SOLAR STAR 3, LLC a Delaware limited liability company (“Seller”). CPA and Seller are sometimes referred to herein individually as a “Party” and jointly as the “Parties”.
Capitalized terms used and not otherwise defined in this Amendment shall have the meanings ascribed to such terms in the Agreement.
RECITALS
The Parties enter into this Amendment with reference to the following facts:
A. The Parties entered into that certain Renewable Power Purchase Agreement, entered into as of June 10, 2024 (as amended from time to time, the “Agreement”), under which, among other things, Seller agreed to sell to Buyer, and Buyer agreed to purchase from Seller, Product under the terms and conditions set forth in the Agreement.
B. Seller has informed Buyer that Seller will not be able to achieve Commercial Operation on or before the Guaranteed Commercial Operation Date, even as such date may be extended due to Development Cure Period delays and/or the payment of Commercial Operation Delay Damages (the “COD Delay”).
C. The Parties desire to amend the Agreement on the terms and subject to the provisions set forth herein.
AGREEMENT
In consideration of the promises, mutual covenants and agreements hereinafter set forth, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties, intending to be legally bound, agree as follows.
1. Amendments to the Agreement. The Agreement is amended as follows:
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2 (a) On the Cover Sheet, in the table titled “Milestones”, the Expected Dates for Completion of the following Milestones are replaced with the following:
Milestone Expected Date for
Completion
Initial Synchronization April 17, 2025
July 20, 2026
Expected Date of CAISO Commercial Operation May 12, 2025 August 12, 2026
Expected Commercial Operation Date July 1, 2025
October 1, 2026
(b) On the Cover Sheet, in the section titled “Guaranteed Commercial Operation Date”, the date of July 1, 2025 is replaced with October 1, 2026.
Guaranteed Commercial Operation Date: July 1, 2025 October 1, 2026 (c) In Section 1.1, new defined terms are added as follows:
“Additional Commercial Operation Delay Damages” has the meaning set forth in Section 2 of PPA Amendment 1.
“Amendment 1 Effective Date” has the meaning set forth in the Preamble of PPA Amendment 1.
“Delay Damages Payment” has the meaning set forth in Section 2 of PPA Amendment 1.
“PPA Amendment 1” means that certain Amendment No. 1 to the Agreement dated as of [___], 2025.
“RA Substitute Capacity” has the meaning set forth in the CAISO Tariff. (d) A new Section 3.7(e) is added as follows:
Seller shall provide RA Substitute Capacity in accordance with applicable CAISO requirements in connection with Facility outages. Seller acknowledges and agrees that any failure by Seller to provide such RA Substitute Capacity may result in CAISO rejecting or cancelling Seller’s request for CAISO to approve such Facility outage. If Seller fails to provide RA Substitute Capacity, then Buyer may elect to not include the Facility (or, if applicable, the portion of the Facility) in its RA Plan and such failure shall be deemed an “Facility RA Shortfall” and Seller’s sole liability to Buyer for such failure to provide the RA Substitute Capacity will be payment of the RA Deficiency Amount for such RA Shortfall pursuant to Section
3.8. Agenda Page 79
3 (e) In Section 4.6(b)(A), the phrase “(including replacement Capacity Attributes as required by the CAISO)” is replaced by the phrase “(including RA Substitute Capacity pursuant to Section 3.7(e))”.
If reasonably required in accordance with Prudent Operating Practices, Seller may perform maintenance at a different time than maintenance scheduled pursuant to Section 4.6(a). Seller shall provide Notice to Buyer within the time period determined by the CAISO for the Facility, as a Resource Adequacy Resource that is subject to the Availability Standards, to qualify for an “Approved Maintenance Outage” under the CAISO Tariff (or such shorter period as may be reasonably acceptable to Buyer based on the likelihood of dispatch by Buyer), and Seller shall (A) reimburse Buyer for any cost Buyer incurs in connection therewith (including replacement Capacity Attributes as required by the CAISO including RA Substitute Capacity pursuant to Section 3.7(e)), and (B) limit maintenance repairs performed pursuant to this Section 4.6(a) to periods when Buyer does not reasonably believe the Facility will be dispatched.
(f) Section 10.4(a) is replaced in its entirety with the following:
If the Seller is delayed in achieving Commercial Operation by the Guaranteed Commercial Operation Date due to one or more Force Majeure Events occurring after the Amendment 1 Effective Date for cumulative extensions granted under the Development Cure Period (other than the extensions granted pursuant to clause 4(d) in Exhibit B) plus the payment of Commercial Operation Delay Damages equal or exceed two hundred seventy (270) days, and Seller has demonstrated to Buyer’s reasonable satisfaction that Seller’s failure to achieve COD by the Guaranteed Commercial Operation Date (as extended) was the result of delays that would have otherwise entitled to Seller to paid to Buyer Additional Commercial Operation Delay Damages for such two hundred seventy (270) days of Development Cure Period delays but for the one hundred eighty (180)-day limitation period, then Seller may terminate this Agreement upon Notice to Buyer. Upon such termination, neither Party shall have any liability to the other Party, save and except for those obligations specified in Sections 2.1(b) and 11.6, and Buyer shall promptly return to Seller any Development Security then held by Buyer plus the full amount of Additional Commercial Operation Delay Damages paid by Seller, (but excluding the Delay Damage Payment), less any amounts drawn in accordance with this Agreement. (g) In Section 11.6, each occurrence of the phrase “Error! Reference source not found.” is replaced with “11.6”.
Limitation on Seller’s Ability to Make or Agree to Third-Party Sales from the Facility after Early Termination Date. If the Agreement is terminated prior
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4 to the Commercial Operation Date for any reason except due to Buyer’s Event of Default, neither Seller nor Seller’s Affiliates may sell, market or deliver any Product associated with or attributable to the Facility to a party other than Buyer for a period of two (2) years following such early termination date, unless prior to selling, marketing or delivering such Product, or entering into the agreement to sell, market or deliver such Product to a party other than Buyer, Seller or Seller’s Affiliates provide Buyer with a written offer to sell the Product on terms and conditions materially similar to the terms and conditions contained in this Agreement (including price) and Buyer fails to accept such offer within forty-five (45) days of Buyer’s receipt thereof; provided, Seller is only obligated to make such offer to Buyer once during such two-year period. In the event the Generation Facility is operational, Buyer agrees that during the period it is considering Seller’s offer under this Section 11.6, Buyer will purchase and pay for all PV Energy at the Test Energy Rate provided for in clause (b) of the third sentence of Section 3.6 without reduction for the duration of such production, even if Test Energy had been or subsequently is provided for more than 180 days.
Neither Seller nor Seller’s Affiliates may sell or transfer the Facility, or any part thereof, or land rights or interests in the Site (including the interconnection queue position of the Facility) so long as the limitations contained in this Section Error! Reference source not found 11.6. apply, unless the transferee agrees to be bound by the terms set forth in this Section Error! Reference source not found 11.6. pursuant to a written agreement approved by Buyer. Subject to Article 12, Seller shall indemnify and hold Buyer harmless from all benefits lost and other damages sustained by Buyer as a result of any breach by Seller of its covenants contained within this Section Error! Reference source not found 11.6. (h) In Section 14.5, the phrase “Error! Reference source not found.” is replaced with “14.5”.
Buyer Financing Assignment. Seller agrees that Buyer may assign a portion of its rights and obligations under this Agreement to a Person in connection with a municipal prepayment financing transaction (“Buyer Assignee”) at any time upon not less than fifteen (15) Business Days’ notice by delivering Notice of such assignment, which notice must include a proposed assignment agreement substantially in the form attached hereto as Exhibit L (“Assignment Agreement”), provided, at the time of such assignment, (a) such Buyer Assignee has a Credit Rating equal to the higher of (i) Buyer’s Credit Rating at the time of such assignment (if applicable), and (ii) Baa3 from Moody’s and BBB- from S&P, (b) the portion of Buyer’s rights and obligations assigned to Buyer Assignee (“Buyer Assignee Percentage”) shall not be less than twenty-percent (20%) of the total Agreement, and (c) such assignment shall not release or novate Buyer from its obligations with respect to the Buyer Assignee Percentage assigned under any Assignment Agreement. As reasonably requested by Buyer Assignee, Seller shall (x) provide Buyer Assignee with information and documentation with respect to Seller, including but not limited to account opening information, information related to forecasted generation, Credit Rating, and compliance with
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5 anti-money laundering rules, the Dodd-Frank Act, the Commodity Exchange Act, the Patriot Act and similar rules, regulations, requirements and corresponding policies; and (y) promptly execute such Assignment Agreement and implement such assignment as contemplated thereby, subject only to the countersignature of Buyer Assignee and Buyer and the requirements of this Section Error! Reference source not found 14.5.; provided, nothing in this Section 14.5 shall require Seller to make any changes to this Agreement, or Seller’s processes, procedures, corporate organization or the Facility to accommodate such Buyer Assignee other than administrative changes (e.g providing invoices and Notices to, and accepting payment from, the Buyer Assignee, etc.). (i) In Section 1(b) of Annex I of Exhibit L, the phrase “Section 1Error! Reference source not found.” is replaced with “Section 1(d)”.
PPA Buyer hereby delegates to Financing Party the obligation to pay for all Assigned Product that is actually delivered to Financing Party pursuant to the Assigned Product Rights during the Assignment Period (the “Delivered Product Payment Obligation” and together with the Assigned Product Rights, collectively the “Assigned Rights and Obligations”); provided that (i) all other obligations of PPA Buyer under the PPA are expressly retained by PPA Buyer and PPA Buyer shall be solely responsible for any amounts due to PPA Seller that are not directly related to Assigned Product; and (ii) the Parties acknowledge and agree that PPA Seller will only be obligated to deliver a single consolidated invoice during the Assignment Period (with a copy to Financing Party consistent with Section 1Error! Reference source not found. Section 1(d) hereof). To the extent Financing Party fails to pay the Delivered Product Payment Obligation by the due date for payment set forth in the PPA, notwithstanding anything in this Agreement to the contrary, PPA Buyer agrees that it shall have the obligation to make such payment and that it will be an Event of Default pursuant to Section
11.1 if PPA Buyer does not make such payment within five (5) Business Days of receiving Notice of such non-payment from PPA Seller.
2. Delay Damages Payment. As consideration for Buyer’s agreement to the terms of this Amendment, and as compensation for its damages due to the COD Delay, Seller has paid to Buyer a total of four million nine hundred thirty-five thousand dollars ($4,935,000) (“Delay Damages Payment”). No further Delay Damages shall be owed by Seller if Commercial Operation is achieved by the Guaranteed Commercial Operation Date set forth in this Amendment. Seller is deemed to have exhausted its right to pay Commercial Operation Delay Damages to extend the Guaranteed Commercial Operation Date as set forth in Section 2 of Exhibit B; provided, the Parties may, in their respective sole discretion, agree in writing to allow Seller an opportunity to pay additional Commercial Operation Delay Damages (as agreed, “Additional Commercial Operation Delay Damages”) to further extend the Guaranteed Commercial Operation Date.
3. No Further Development Cure Period. Notwithstanding anything in the Agreement to the
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6 contrary, Seller shall not be entitled to any further Development Cure Period delays under the Agreement for any reason.
4. Miscellaneous.
(a) Reservation of Rights. Each of the Parties expressly reserves all of its respective rights and remedies under the Agreement.
(b) Legal Effect. Except as expressly modified as set forth herein, the Agreement remains unchanged and, as so modified, the Agreement shall remain in full force and effect. Seller hereby represents and warrants that the representations contained in Section 13.1 of the Agreement are true on and as of the Amendment Effective Date as if made by Seller on and as of the Amendment Effective Date with respect to this Amendment. CPA hereby represents and warrants that the representations contained in Section 13.2 of the Agreement are true on and as of the Amendment Effective Date as if made by Seller on and as of the Amendment Effective Date with respect to this Amendment.
(c) Governing Law. This amendment 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. To the extent enforceable at such time, each party waives its respective right to any jury trial with respect to any litigation arising under or in connection with this amendment.
(d) Successors and Assigns. This Amendment shall inure to the benefit of and be binding upon the Parties and their respective successors and permitted assigns. (e) Authorized Signatures; Notices. Each Party represents and warrants that the person who signs below on behalf of that Party has authority to execute this Amendment on behalf of such Party and to bind such Party to this Amendment. Any written notice required to be given under the terms of this Amendment shall be given in accordance with the terms of the Agreement.
(f) Effective Date. This Amendment shall be deemed effective as of the Amendment Effective Date.
(g) Further Agreements. This Amendment may only be amended, modified or supplemented by an instrument in writing executed by duly authorized representatives of Seller and CPA; provided, this Amendment may not be amended by electronic mail communications.
(h) Counterparts. This Amendment 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.
(i) Electronic Delivery. This Amendment may be duly executed and delivered by a Party by electronic format (including portable document format (.pdf)) delivery of
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7 the signature page of a counterpart to the other Party. [Remainder of this page intentionally left blank]
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IN WITNESS WHEREOF, the Parties have read this Agreement, understand it, and agree to be bound by its terms as of the Effective Date.
SOLAR STAR 3, LLC,
a Delaware limited liability company.
CLEAN POWER ALLIANCE OF
SOUTHERN CALIFORNIA,
a California joint powers authority.
By: By:
Name: Name:
Title: Title:
Date: Date:
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AMENDMENT NO. 1
to the
RENEWABLE POWER PURCHASE AGREEMENT
between
CLEAN POWER ALLIANCE OF SOUTHERN CALIFORNIA
and
SOLAR STAR 4, LLC
This Amendment No. 1 (“Amendment”) to the Agreement (as that term is defined below), dated as of September__, 2025 (the “Amendment Effective Date”), is entered between CLEAN POWER ALLIANCE OF SOUTHERN CALIFORNIA, a California joint powers authority (“Buyer”)), and SOLAR STAR 4, LLC a Delaware limited liability company (“Seller”). CPA and Seller are sometimes referred to herein individually as a “Party” and jointly as the “Parties”.
Capitalized terms used and not otherwise defined in this Amendment shall have the meanings ascribed to such terms in the Agreement.
RECITALS
The Parties enter into this Amendment with reference to the following facts:
A. The Parties entered into that certain Renewable Power Purchase Agreement, entered into as of June 10, 2024 (as amended from time to time, the “Agreement”), under which, among other things, Seller agreed to sell to Buyer, and Buyer agreed to purchase from Seller, Product under the terms and conditions set forth in the Agreement.
B. Seller has informed Buyer that Seller will not be able to achieve Commercial Operation on or before the Guaranteed Commercial Operation Date, even as such date may be extended due to Development Cure Period delays and/or the payment of Commercial Operation Delay Damages (the “COD Delay”).
C. The Parties desire to amend the Agreement on the terms and subject to the provisions set forth herein.
AGREEMENT
In consideration of the promises, mutual covenants and agreements hereinafter set forth, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties, intending to be legally bound, agree as follows.
1. Amendments to the Agreement. The Agreement is amended as follows:
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2 (a) On the Cover Sheet, in the table titled “Milestones”, the Expected Dates for Completion of the following Milestones are replaced with the following:
Milestone Expected Date for
Completion
Initial Synchronization May 20, 2025
July 20, 2026
Expected Date of CAISO Commercial Operation June 12, 2025 August 12, 2026
Expected Commercial Operation Date August 1, 2025
October 1, 2026
(b) On the Cover Sheet, in the section titled “Guaranteed Commercial Operation Date”, the date of August 1, 2025 is replaced with October 1, 2026.
Guaranteed Commercial Operation Date: August 1, 2025 October 1, 2026 (c) In Section 1.1, new defined terms are added as follows:
“Additional Commercial Operation Delay Damages” has the meaning set forth in Section 2 of PPA Amendment 1.
“Amendment 1 Effective Date” has the meaning set forth in the Preamble of PPA Amendment 1.
“Delay Damages Payment” has the meaning set forth in Section 2 of PPA Amendment 1.
“PPA Amendment 1” means that certain Amendment No. 1 to the Agreement dated as of [___], 2025.
“RA Substitute Capacity” has the meaning set forth in the CAISO Tariff. (d) A new Section 3.7(e) is added as follows:
Seller shall provide RA Substitute Capacity in accordance with applicable CAISO requirements in connection with Facility outages. Seller acknowledges and agrees that any failure by Seller to provide such RA Substitute Capacity may result in CAISO rejecting or cancelling Seller’s request for CAISO to approve such Facility outage. If Seller fails to provide RA Substitute Capacity, then Buyer may elect to not include the Facility (or, if applicable, the portion of the Facility) in its RA Plan and such failure shall be deemed an “Facility RA Shortfall” and Seller’s sole liability to Buyer for such failure to provide the RA Substitute Capacity will be payment of the RA Deficiency Amount for such RA Shortfall pursuant to Section
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3 (e) In Section 4.6(b)(A), the phrase “(including replacement Capacity Attributes as required by the CAISO)” is replaced by the phrase “(including RA Substitute Capacity pursuant to Section 3.7(e))”.
If reasonably required in accordance with Prudent Operating Practices, Seller may perform maintenance at a different time than maintenance scheduled pursuant to Section 4.6(a). Seller shall provide Notice to Buyer within the time period determined by the CAISO for the Facility, as a Resource Adequacy Resource that is subject to the Availability Standards, to qualify for an “Approved Maintenance Outage” under the CAISO Tariff (or such shorter period as may be reasonably acceptable to Buyer based on the likelihood of dispatch by Buyer), and Seller shall (A) reimburse Buyer for any cost Buyer incurs in connection therewith (including replacement Capacity Attributes as required by the CAISO including RA Substitute Capacity pursuant to Section 3.7(e)), and (B) limit maintenance repairs performed pursuant to this Section 4.6(a) to periods when Buyer does not reasonably believe the Facility will be dispatched.
(f) Section 10.4(a) is replaced in its entirety with the following:
If the Seller is delayed in achieving Commercial Operation by the Guaranteed Commercial Operation Date due to one or more Force Majeure Events occurring after the Amendment 1 Effective Date for cumulative extensions granted under the Development Cure Period (other than the extensions granted pursuant to clause 4(d) in Exhibit B) plus the payment of Commercial Operation Delay Damages equal or exceed two hundred seventy (270) days, and Seller has demonstrated to Buyer’s reasonable satisfaction that Seller’s failure to achieve COD by the Guaranteed Commercial Operation Date (as extended) was the result of delays that would have otherwise entitled to Seller to paid to Buyer Additional Commercial Operation Delay Damages for such two hundred seventy (270) days of Development Cure Period delays but for the one hundred eighty (180)-day limitation period, then Seller may terminate this Agreement upon Notice to Buyer. Upon such termination, neither Party shall have any liability to the other Party, save and except for those obligations specified in Sections 2.1(b) and 11.6, and Buyer shall promptly return to Seller any Development Security then held by Buyer plus the full amount of Additional Commercial Operation Delay Damages paid by Seller, (but excluding the Delay Damage Payment), less any amounts drawn in accordance with this Agreement. (g) In Section 11.6, each occurrence of the phrase “Error! Reference source not found.” is replaced with “11.6”.
Limitation on Seller’s Ability to Make or Agree to Third-Party Sales from the Facility after Early Termination Date. If the Agreement is terminated prior
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4 to the Commercial Operation Date for any reason except due to Buyer’s Event of Default, neither Seller nor Seller’s Affiliates may sell, market or deliver any Product associated with or attributable to the Facility to a party other than Buyer for a period of two (2) years following such early termination date, unless prior to selling, marketing or delivering such Product, or entering into the agreement to sell, market or deliver such Product to a party other than Buyer, Seller or Seller’s Affiliates provide Buyer with a written offer to sell the Product on terms and conditions materially similar to the terms and conditions contained in this Agreement (including price) and Buyer fails to accept such offer within forty-five (45) days of Buyer’s receipt thereof; provided, Seller is only obligated to make such offer to Buyer once during such two-year period. In the event the Generation Facility is operational, Buyer agrees that during the period it is considering Seller’s offer under this Section 11.6, Buyer will purchase and pay for all PV Energy at the Test Energy Rate provided for in clause (b) of the third sentence of Section 3.6 without reduction for the duration of such production, even if Test Energy had been or subsequently is provided for more than 180 days.
Neither Seller nor Seller’s Affiliates may sell or transfer the Facility, or any part thereof, or land rights or interests in the Site (including the interconnection queue position of the Facility) so long as the limitations contained in this Section Error! Reference source not found 11.6. apply, unless the transferee agrees to be bound by the terms set forth in this Section Error! Reference source not found 11.6. pursuant to a written agreement approved by Buyer. Subject to Article 12, Seller shall indemnify and hold Buyer harmless from all benefits lost and other damages sustained by Buyer as a result of any breach by Seller of its covenants contained within this Section Error! Reference source not found 11.6. (h) In Section 14.5, the phrase “Error! Reference source not found.” is replaced with “14.5”.
Buyer Financing Assignment. Seller agrees that Buyer may assign a portion of its rights and obligations under this Agreement to a Person in connection with a municipal prepayment financing transaction (“Buyer Assignee”) at any time upon not less than fifteen (15) Business Days’ notice by delivering Notice of such assignment, which notice must include a proposed assignment agreement substantially in the form attached hereto as Exhibit L (“Assignment Agreement”), provided, at the time of such assignment, (a) such Buyer Assignee has a Credit Rating equal to the higher of (i) Buyer’s Credit Rating at the time of such assignment (if applicable), and (ii) Baa3 from Moody’s and BBB- from S&P, (b) the portion of Buyer’s rights and obligations assigned to Buyer Assignee (“Buyer Assignee Percentage”) shall not be less than twenty-percent (20%) of the total Agreement, and (c) such assignment shall not release or novate Buyer from its obligations with respect to the Buyer Assignee Percentage assigned under any Assignment Agreement. As reasonably requested by Buyer Assignee, Seller shall (x) provide Buyer Assignee with information and documentation with respect to Seller, including but not limited to account opening information, information related to forecasted generation, Credit Rating, and compliance with
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5 anti-money laundering rules, the Dodd-Frank Act, the Commodity Exchange Act, the Patriot Act and similar rules, regulations, requirements and corresponding policies; and (y) promptly execute such Assignment Agreement and implement such assignment as contemplated thereby, subject only to the countersignature of Buyer Assignee and Buyer and the requirements of this Section Error! Reference source not found 14.5.; provided, nothing in this Section 14.5 shall require Seller to make any changes to this Agreement, or Seller’s processes, procedures, corporate organization or the Facility to accommodate such Buyer Assignee other than administrative changes (e.g providing invoices and Notices to, and accepting payment from, the Buyer Assignee, etc.). (i) In Section 1(b) of Annex I of Exhibit L, the phrase “Section 1Error! Reference source not found.” is replaced with “Section 1(d)”.
PPA Buyer hereby delegates to Financing Party the obligation to pay for all Assigned Product that is actually delivered to Financing Party pursuant to the Assigned Product Rights during the Assignment Period (the “Delivered Product Payment Obligation” and together with the Assigned Product Rights, collectively the “Assigned Rights and Obligations”); provided that (i) all other obligations of PPA Buyer under the PPA are expressly retained by PPA Buyer and PPA Buyer shall be solely responsible for any amounts due to PPA Seller that are not directly related to Assigned Product; and (ii) the Parties acknowledge and agree that PPA Seller will only be obligated to deliver a single consolidated invoice during the Assignment Period (with a copy to Financing Party consistent with Section 1Error! Reference source not found. Section 1(d) hereof). To the extent Financing Party fails to pay the Delivered Product Payment Obligation by the due date for payment set forth in the PPA, notwithstanding anything in this Agreement to the contrary, PPA Buyer agrees that it shall have the obligation to make such payment and that it will be an Event of Default pursuant to Section
11.1 if PPA Buyer does not make such payment within five (5) Business Days of receiving Notice of such non-payment from PPA Seller.
2. Delay Damages Payment. As consideration for Buyer’s agreement to the terms of this Amendment, and as compensation for its damages due to the COD Delay, Seller has paid to Buyer a total of four million nine hundred thirty-five thousand dollars ($4,935,000) (“Delay Damages Payment”). No further Delay Damages shall be owed by Seller if Commercial Operation is achieved by the Guaranteed Commercial Operation Date set forth in this Amendment. Seller is deemed to have exhausted its right to pay Commercial Operation Delay Damages to extend the Guaranteed Commercial Operation Date as set forth in Section 2 of Exhibit B; provided, the Parties may, in their respective sole discretion, agree in writing to allow Seller an opportunity to pay additional Commercial Operation Delay Damages (as agreed, “Additional Commercial Operation Delay Damages”) to further extend the Guaranteed Commercial Operation Date.
3. No Further Development Cure Period. Notwithstanding anything in the Agreement to the
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6 contrary, Seller shall not be entitled to any further Development Cure Period delays under the Agreement for any reason.
4. Miscellaneous.
(a) Reservation of Rights. Each of the Parties expressly reserves all of its respective rights and remedies under the Agreement.
(b) Legal Effect. Except as expressly modified as set forth herein, the Agreement remains unchanged and, as so modified, the Agreement shall remain in full force and effect. Seller hereby represents and warrants that the representations contained in Section 13.1 of the Agreement are true on and as of the Amendment Effective Date as if made by Seller on and as of the Amendment Effective Date with respect to this Amendment. CPA hereby represents and warrants that the representations contained in Section 13.2 of the Agreement are true on and as of the Amendment Effective Date as if made by Seller on and as of the Amendment Effective Date with respect to this Amendment.
(c) Governing Law. This amendment 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. To the extent enforceable at such time, each party waives its respective right to any jury trial with respect to any litigation arising under or in connection with this amendment.
(d) Successors and Assigns. This Amendment shall inure to the benefit of and be binding upon the Parties and their respective successors and permitted assigns. (e) Authorized Signatures; Notices. Each Party represents and warrants that the person who signs below on behalf of that Party has authority to execute this Amendment on behalf of such Party and to bind such Party to this Amendment. Any written notice required to be given under the terms of this Amendment shall be given in accordance with the terms of the Agreement.
(f) Effective Date. This Amendment shall be deemed effective as of the Amendment Effective Date.
(g) Further Agreements. This Amendment may only be amended, modified or supplemented by an instrument in writing executed by duly authorized representatives of Seller and CPA; provided, this Amendment may not be amended by electronic mail communications.
(h) Counterparts. This Amendment 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.
(i) Electronic Delivery. This Amendment may be duly executed and delivered by a Party by electronic format (including portable document format (.pdf)) delivery of
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7 the signature page of a counterpart to the other Party. [Remainder of this page intentionally left blank]
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IN WITNESS WHEREOF, the Parties have read this Agreement, understand it, and agree to be bound by its terms as of the Effective Date.
SOLAR STAR 4, LLC,
a Delaware limited liability company.
CLEAN POWER ALLIANCE OF
SOUTHERN CALIFORNIA,
a California joint powers authority.
By: By:
Name: Name:
Title: Title:
Date: Date:
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Staff Report – Agenda Item 4
To: Board of Directors
From: Clarissa Chan, Senior Manager, Market Operations
Reviewed by: Lindsay Descagnia, Vice President, Power Supply Matthew Langer, Chief Operating Officer
Nancy Whang, General Counsel
Approved By: Ted Bardacke, Chief Executive Officer
Subject: Settlements Software Professional Services Agreement Date: September 4, 2025
RECOMMENDATION
Approve and authorize the Chief Executive Officer to execute the Professional Services Agreement with Yes Energy for settlement software, cloud hosting services, operational support and maintenance, and implementation for a one-year initial term with two optional successive one-year terms for a total contract value of up to $976,874.
BACKGROUND
CPA, like other market participants transacting on the California Independent System Operator (“CAISO”) market, must settle its energy purchases and sales with CAISO.
Settlements involve the calculation, billing, and invoicing of charges and payments. This settlement process is complex requiring adherence to specific timelines and processes for publication of statements, invoices, dispute submittals, and payments.
In 2024, CPA settled over $900 million in energy procurement costs through CAISO, including both its electricity load and electricity supply resources. Given the complexity of data generated by CAISO market operations as well as the importance of tracking these Agenda Page 94
Board of Directors Item 4
costs for CPA’s overall financial results, in 2023, CPA decided to enhance its in-house settlements functionality by utilizing software to track CAISO settlements, forecast future settlement values, and create additional reporting on CPA’s portfolio financial performance, including individual supply resource performance.
As a result, CPA conducted a competitive solicitation and contracted with Adapt2 for settlements software. That contract expires on February 9, 2026.
SOLICITATION OVERVIEW
Anticipating the expiration of the current Adapt2 contract, on April 15, 2025, CPA released a Request for Proposals (RFP) for settlement software, cloud hosting services, operational support and maintenance, and implementation. The RFP was timed to allow for a potential transition if a new software vendor was selected ahead of the February 2026 contract expiration of the current contract. Minimum experience and qualifications included in the RFP were:
• Applicable experience with providing comprehensive settlements software products to manage, track, and dispute CAISO settlements. • Applicable experience to support implementation of the settlements software product.
• Applicable experience with providing software training and support services for CCAs, load-serving entities (“LSEs”), or electric or municipal utilities.
RESPONSE SUMMARY
CPA received proposals from five (5) potential bidders. Based on staff’s review and evaluation, CPA shortlisted three (3) proposals that satisfied the minimum experience and qualifications outlined in the solicitation, showed the ability to deliver the contemplated scope of services, and demonstrated existing relationships with other comparable CCAs or LSEs. CPA staff interviewed the three short-listed proposers and recommend Yes Energy as the proposed vendor.
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Board of Directors Item 4
SELECTION JUSTIFICATION
Yes Energy was selected as the most qualified proposer offering the best value to CPA, while not the lowest cost proposer1, due to its demonstrated subject matter expertise, ability to deliver the contemplated scope of services within the time frame requested, and experience implementing settlement software services for other LSEs of comparable size or larger. Further information about staff’s evaluation is described below.
Yes Energy employs approximately 200 employees, serves 600 clients worldwide, and generates $100 million in annual revenue. In 2024, Yes Energy acquired Power Settlements, a software company that was one of the most experienced CAISO Settlements software and service providers, offering solutions to CAISO market participants for over 18 years, with more than 50 clients using its platform.
Subject Matter Expertise
Yes Energy’s settlements system was originally developed specifically for the CAISO market. Unlike other vendors whose platforms are designed to accommodate multiple Independent System Operators (ISOs), Yes Energy's singular focus on CAISO ensures its team remains fully aligned with CAISO’s quickly changing market. This specialization enables a more streamlined, accurate, and responsive solution tailored to CPA’s operational needs.
Scope and Timeline
Yes Energy's proposal includes the implementation of a comprehensive suite of modules tailored to CPA’s settlement operations within the CAISO market. These include the ISO Downloader, which downloads CAISO data; Shadow Settlements module, which independently calculates the CAISO settlement statement to identify potential disputes and estimate transactions before invoicing; Allocations module, which disaggregates transactions for financial reporting; and Visual Analytics module, which enables CPA to 1 Yes Energy submitted a cost proposal that was 6.7% higher than its next competitor, or approximately $15,000 more per year. As explained in the Selection Justification section, Yes Energy’s proposal offered additional value through having the most comprehensive settlement validation, streamlined data accessibility, and enhanced tools for identifying complex operational issues.
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Board of Directors Item 4
graphically view resource operations and more easily identify complex discrepancies.
Together, these modules provide end-to-end functionality for data import, settlement validation, forecasting of future settlements, general ledger mapping, and advanced analytics and reporting. Yes Energy demonstrated a clear understanding of CPA’s operational needs and presented a detailed implementation plan aligned with CPA’s required timeline, ensuring timely delivery without compromising quality or functionality.
Experience
Yes Energy has successfully implemented settlement software services for several Community Choice Aggregators (CCAs), including Clean PowerSF, San Diego Community Power (SDCP), and Marin Clean Energy (MCE). Additionally, they serve other LSEs such as Los Angeles Department of Water and Power (LADWP) and Southern California Edison (SCE), further demonstrating the ability to support high-volume, high-complexity operations.
CONTRACT SUMMARY
The initial term of the agreement is proposed to commence on September 5, 2025 with a 5-month implementation phase and continues through December 31, 2026. After the initial term, CPA has the option for two (2), one year renewal terms. The initial term is priced slightly higher than the renewal terms because it covers 16 months compared to the 12-month renewal periods. Each of the two optional renewal terms includes an inflation adjustment increase, 1.6% for renewal year one, and 1.8% for renewal year two.
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Board of Directors Item 4
FISCAL IMPACT
The FY 2025-26 budget is sufficient to cover the cost of the contract. Costs for subsequent years will be included in future budget proposals.
ATTACHMENT
1. Professional Services Agreement with Yes Energy
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1 Clean Power Alliance of Southern California
This Professional Services Agreement (this “Agreement”), dated and effective as of September 5, 2025 (the “Effective Date”), is made by and between:
CLEAN POWER ALLIANCE OF SOUTHERN CALIFORNIA (“CPA”), and YES ENERGY, LLC (“Contractor”).
CPA and Contractor are sometimes collectively referred to herein as the “Parties” and each individually as a “Party.” In consideration of the terms of this Agreement, and for other good and valuable consideration, the Parties make the following acknowledgments and agreements:
RECITALS
WHEREAS, CPA may contract with a provider for California Independent System Operator (“CAISO”) settlement software services;
WHEREAS, CPA conducted a Request for Proposals (“RFP”), and CPA selected Contractor because Contractor has the expertise and experience to provide the specified services to CPA and offered CPA the Best Value; WHEREAS, Contractor desires to provide these specified services to CPA; WHEREAS, the purpose of this Agreement is to set forth the terms and conditions upon which Contractor shall provide services to CPA; NOW, THEREFORE, it is agreed based on the consideration set forth below by the Parties to this Agreement as follows:
AGREEMENT
1. Definitions
a. The definition of “Confidential Information” is set forth in paragraph 10.b. of this Agreement.
b. “CPA Data” shall mean all data gathered or created by Contractor in the performance of the Services pursuant to this Agreement, including any customer or customer-related data. For the avoidance of doubt, CPA Data does not include Contractor’s Software as defined in Exhibit D. c. “CPA Information” shall mean all confidential, proprietary, or sensitive information provided by CPA to Contractor in connection with this Agreement. d. “CPA Materials” shall mean reports or other documents containing CPA data.
For the avoidance of doubt, report templates, including any created specifically for use during the CPA implementation of Contractor’s Software will remain the property of Contractor.
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2 e. “CPA Product” includes collectively CPA Data, CPA Information, and CPA Materials.
f. “Services” shall mean the scope of work Contractor provides to CPA as specified in Exhibit A.
2. Exhibits and Attachments
The following exhibits and attachments are attached to this Agreement and incorporated into this Agreement by this reference:
Exhibit A – Scope of Work
Exhibit B – Contractor’s Workplan and Schedule
Exhibit C – Compensation
Exhibit D – Contractor’s License and Software Services Agreement Should a conflict arise between language in the body of this Agreement and any exhibit or attachment to this Agreement, the language in the body of this Agreement controls, followed by Exhibit A, B, C, and D in that order.
Notwithstanding the foregoing, solely with respect to Contractor’s Software, as defined in Exhibit D, Exhibit D shall control, except in the event of a conflict with the language in the body of this Agreement, or Exhibit A, B, and C.
3. Services to be Performed by Contractor
In consideration of the payments set forth in this Agreement and in Exhibit C, Contractor shall perform services for CPA in accordance with the terms, conditions, and specifications set forth in this Agreement and in Exhibits A and B (“Services”).
4. Compensation
CPA agrees to compensate Contractor as specified in Exhibit C:
a. In consideration of the Services provided by Contractor in accordance with all terms, conditions and specifications set forth in this Agreement and Exhibit A and Exhibit B, CPA shall make payment to Contractor on a fixed fee basis and in the manner specified in Exhibit C.
b. Unless otherwise indicated in Exhibit C, Contractor shall invoice CPA monthly to [email protected] for all compensation related to Services performed during the previous month. Payments shall be due within fifteen (15) calendar days after the date the invoice is submitted to CPA at the specified email address. All payments must be made in U.S. dollars.
5. Term
Subject to compliance with all terms and conditions of this Agreement, the term of this Agreement shall begin on the Effective Date and end on December 31, 2026 (“Initial Term”). At the end of the Initial Term, the Parties may renew this Agreement for two successive one (1) year terms for a maximum of two additional years (each, a “Renewal
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3 Term”), unless either Party provides ninety (90) days prior written notice of its intent not to renew the term of the Agreement (“Renewal Notice”).
2. Termination
a. Termination for Convenience. CPA may terminate the Agreement in accordance with this paragraph in whole, or from time to time in part, whenever CPA determines that termination is in CPA’s best interests. A termination for convenience, in part or in whole, shall take effect by CPA delivering to Contractor, at least thirty (30) calendar days prior to the effective date of the termination or prior to a Notice of Termination specifying the extent to which performance of the Services under the Agreement is terminated.
If the termination for convenience is partial, Contractor may invoice CPA reflecting the price or prices specified in the Agreement relating to the portion of this Agreement which is not terminated. Nothing contained herein shall limit the right of CPA and Contractor to agree upon amount or amounts to be paid to Contractor for completing the continued portion of the Agreement when the Agreement does not contain an established price for the continued portion.
Nothing contained herein shall limit CPA’s rights and remedies at law. b. Termination for Default. If Contractor fails to provide in any manner the Services required under this Agreement, otherwise fails to comply with the terms of this Agreement, or violates any ordinance, regulation or law which applies to its performance herein and such default continues uncured for thirty (30) calendar days after written notice is given to Contractor, CPA may terminate this Agreement by giving five (5) business days' written notice. If Contractor requires more than thirty (30) calendar days to cure, then CPA may, at its sole discretion, authorize additional time as may reasonably be required to effect such cure provided that Contractor diligently and continuously pursues such cure.
c. Termination for Lack of Third-Party Funding. CPA may terminate this Agreement if funding for this Agreement is reduced or eliminated by a third-party funding source. d. Effect of Termination. Upon the effective date of expiration or termination of this Agreement: (i) Contractor may immediately cease providing Services in its entirety or if a termination to a part of the Agreement, cease providing the Services that have been terminated; (ii) any and all payment obligations of CPA under this Agreement will become due immediately except any equitable adjustment pursuant to Paragraph 5(a); (iii) promptly transfer title and deliver to CPA all CPA Product or any work in progress pursuant to this Agreement; and (iv) each Party will promptly either return or destroy (as directed by the other Party) all Confidential Information of the other Party in its possession as well as any other materials or information of the other Party in its possession.
Upon such expiration or termination, and upon request of CPA, Contractor shall reasonably cooperate with CPA to ensure a prompt and efficient transfer of all data, documents and other materials to CPA in a manner such as to minimize the impact of expiration or termination on CPA’s customers.
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4 3. Contract Materials
CPA owns all right, title and interest in and to all CPA Materials and CPA Data. Upon the expiration of this Agreement, or in the event of termination, CPA Materials and all CPA Information, in whatever form and in any state of completion, shall remain the property of CPA and shall be promptly deleted, destroyed, or returned to CPA. Upon termination, Contractor may make and retain a copy of such CPA Materials if required by law or pursuant to the Contractor’s reasonable document retention or destruction policies.
4. Payments of Permits/Licenses
Contractor bears responsibility to obtain any license, permit, or approval required for it to provide the Services to be performed under this Agreement at Contractor’s own expense prior to commencement of the Services.
5. No Recourse against Constituent Members
CPA 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 the Joint Powers Agreement and is a public entity separate from its constituent members. CPA shall solely be responsible for all debts, obligations and liabilities accruing and arising out of this Agreement. Contractor shall have no rights and shall not make any claims, take any actions or assert any remedies against any of CPA’s constituent members in connection with this Agreement.
6. Confidential Information
a. Duty to Maintain Confidentiality. Each Party receiving Confidential Information agrees that it will hold all Confidential Information of the disclosing Party in confidence, and will not divulge, disclose, or directly or indirectly use, copy, digest, or summarize, any Confidential Information unless necessary to comply with any applicable law, regulation, or in connection with any court or regulatory proceeding applicable in which case, any disclosure shall be subject to this paragraph, 10.c., and 10.d., below.
b. Definition of “Confidential Information”. The following constitutes “Confidential Information,” whether oral or written: (a) the terms and conditions of, and proposals and negotiations related to, this Agreement, (b) information, in whatever form, that either Party shares with the other in the course and scope of this Agreement, or (c) information that either Party stamps or otherwise identifies as “confidential” or “proprietary” before disclosing it to the other.
Confidential Information shall not include: (l) information that is generally available to the public or in the public domain at the time of disclosure; (2) information that becomes publicly known other than through any breach of this Agreement by the Receiving Party or its Representatives; (3) information which is subsequently lawfully and in good faith obtained by the receiving Party or its Representatives from a third party, as shown by documentation sufficient to establish the third party as the source of the Confidential Information; provided that the disclosure of such information by such third party is not
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5 known by the receiving Party or its Representatives to be in breach of a confidentiality agreement or other similar obligation of confidentiality; (4) information that the receiving Party or its Representatives develop independently without use of or reference to Confidential Information provided by the receiving Party; or (5) information that is approved for release in writing by the receiving Party.
c. California Public Records Act. The Parties acknowledge and agree that the Agreement including but not limited to any communication or information exchanged between the Parties, any deliverable, or work product are subject to the requirements of the California Public Records Act (Government Code Section 6250 et seq.). In order to designate information as confidential, the disclosing Party must clearly stamp and identify the specific portion of the material designated with the word “Confidential.” The Parties agree not to over-designate material as Confidential Information. Over-designation includes stamping whole agreements, entire pages or series of pages as “Confidential” that clearly contain information that is not Confidential Information. d. Third Party Request for Confidential Information. Upon request or demand of any third person or entity not a Party hereto pursuant to the California Public Records Act for production, inspection and/or copying of Confidential Information (“Requested Confidential Information”), CPA will as soon as practical notify Contractor in writing via email that such request has been made.
Contractor will be solely responsible for taking at its sole expense whatever legal steps are necessary to prevent release to the third party of the Confidential Information designated by Contractor. If Contractor takes no such action after receiving the foregoing notice from CPA, CPA shall, at its discretion, be permitted to comply with the third party’s request or demand and is not required to defend against it. If Contractor does take or attempt to take such action, Contractor agrees to indemnify and hold harmless CPA, its officers, directors, employees and agents (“CPA Indemnified Parties”), from any claims, liability, award of attorneys’ fees, or damages, and to defend any action, claim or lawsuit brought against any of CPA Indemnified Parties for Contractor’s attempt to prevent disclosure or CPA’s refusal to disclose any Confidential Information.
11. Insurance
All required insurance coverages shall be substantiated with a certificate of insurance and must be signed by the insurer or its representative evidencing such insurance to CPA within 10 business days after the Agreement is fully executed. The general liability policy shall be endorsed naming Clean Power Alliance of Southern California and its employees, officers and agents as additional insureds. The certificate(s) of insurance and required endorsement shall be furnished to CPA prior to commencement of work and maintained throughout the Term and any Renewal Term. Each certificate shall provide for thirty (30) days advance written notice to CPA of any cancellation or reduction in coverage. Said policies shall remain in force through the life of this Agreement and shall be payable on a per occurrence basis only, except those required by paragraph (d) below which may be provided on a claims-made basis consistent with the criteria noted therein.
Nothing herein shall be construed as a limitation on Contractor’s obligation under
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6 paragraph 12 of this Agreement to indemnify, defend, and hold CPA harmless from any and all liabilities arising from the Contractor’s gross negligence, recklessness or willful misconduct in the performance of this Agreement. CPA agrees to timely notify the Contractor of any negligence claim.
Failure to provide and maintain the insurance required by this Agreement will constitute a material breach of the Agreement. In addition to any other available remedies, CPA may suspend payment to the Contractor for any services provided during any time that insurance was not in effect and until such time as the Contractor provides adequate evidence that Contractor has obtained the required coverage. a. General Liability
The Contractor shall maintain a commercial general liability insurance policy in an amount of no less than one million ($1,000,000.00) with a two million dollar ($2,000,000.00) aggregate limit. CPA shall be named as an additional insured on the commercial general liability policy and the Certificate of Insurance shall include an additional endorsement page.
b. Auto Liability
Where the services to be provided under this Agreement involve or require the use of any type of vehicle by Contractor in order to perform said services, Contractor shall also provide comprehensive business or commercial automobile liability coverage including non-owned and hired automobile liability in the amount of one million dollars combined single limit ($1,000,000.00).
c. Workers’ Compensation
The Contractor acknowledges the State of California requires every employer to be insured against liability for workers’ compensation or to undertake self-insurance in accordance with the provisions of the Labor Code. If Contractor has employees, a copy of the certificate evidencing such insurance or a copy of the Certificate of Consent to Self-Insure shall be provided to CPA prior to commencement of work. d. Professional Liability Insurance
Coverages required by this paragraph may be provided on a claims-made basis with a “Retroactive Date” either prior to the date of the Agreement or the beginning of the contract work. If the policy is on a claims-made basis, coverage must extend to a minimum of twelve (12) months beyond completion of contract work. If coverage is cancelled or non-renewed, and not replaced with another claims made policy form with a “retroactive date” prior to the Agreement effective date, the Contractor must purchase “extended reporting” coverage for a minimum of twelve (12) months after completion of contract work.
Contractor shall maintain a policy limit of not less than $1,000,000.00 per incident. If the deductible or self-insured retention amount exceeds $100,000.00, CPA may ask for evidence that Contractor has segregated amounts in a special insurance reserve fund or Contractor’s general insurance reserves are adequate to provide the necessary coverage and CPA may conclusively rely thereon.
Contractor shall be responsible for initiating, maintaining and supervising all safety
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7 precautions and programs in connection with the performance of the Agreement.
Contractor shall monitor the safety of the job site(s) during the project to comply with all applicable federal, state, and local laws, and to follow safe work practices.
7. Indemnification
Contractor agrees to indemnify, defend, and hold harmless CPA, its employees, officers, and agents, from and against, and shall assume full responsibility for payment of all wages, state or federal payroll, social security, income or self-employment taxes, with respect to Contractor’s performance of this Agreement. Contractor further agrees to indemnify, and hold harmless CPA from and against any and all third-party claims, liabilities, penalties, forfeitures, suits, costs and expenses incident thereto (including costs of defense, settlement, and reasonable attorney’s fees), which CPA may hereafter incur, become responsible for, or pay out, as a result of any violation of governmental laws, regulations or orders, to the extent caused by Contractor’s reckless acts, errors or omissions, or the reckless acts, errors or omissions of Contractor’s employees, agents, or subcontractors while in the performance of the terms and conditions of the Agreement, except for such loss or damage arising from the sole negligence or willful misconduct of CPA, elected and appointed officers, employees, agents and volunteers.
8. Independent Contractor
a. Contractor acknowledges that Contractor, its officers, employees, or agents will not be deemed to be an employee of CPA for any purpose whatsoever, including, but not limited to: (i) eligibility for inclusion in any retirement or pension plan that may be provided to employees of Contractor; (ii) sick pay; (iii) paid non-working holidays; (iv) paid vacations or personal leave days; (v) participation in any plan or program offering life, accident, or health insurance for employees of Contractor; (vi) participation in any medical reimbursement plan; or (vii) any other fringe benefit plan that may be provided for employees of Contractor.
b. Contractor declares that Contractor will comply with all federal, state, and local laws regarding registrations, authorizations, reports, business permits, and licenses that may be required to carry out the work to be performed under this Agreement. Contractor agrees to provide CPA with copies of any registrations or filings made in connection with the work to be performed under this Agreement.
9. Compliance with Applicable Laws
Contractor shall comply with any and all applicable federal, state and local laws and resolutions affecting Services covered by this Agreement.
10. Nondiscriminatory Employment
Contractor and/or any permitted subcontractor, shall not unlawfully discriminate against any individual based on race, color, religion, nationality, sex, sexual orientation, age, protected veteran status, or condition of disability. Contractor and/or any permitted subcontractor understands and agrees that Contractor and/or any permitted subcontractor is bound by and will comply with the nondiscrimination mandates of all
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8 federal, state and local statutes, regulations and ordinances.
11. Work Product.
With the exception of Contractor’s Software and Documentation as defined in Exhibit D, all finished and unfinished reports, plans, studies, documents and other writings prepared by and for Contractor, its officers, employees and agents in the course of implementing this Agreement shall become the sole property of CPA upon payment in full to Contractor for such work. CPA shall have the exclusive right to use such materials in its sole discretion without further compensation to Contractor or to any other party. Contractor shall, at CPA’s expense, provide such reports, plans, studies, documents and writings to CPA or any party CPA may designate, upon written request. Contractor may keep file reference copies of all documents prepared for CPA.
12. Notices
Any notice, request, demand, or other communication required or permitted under this Agreement shall be deemed to be properly given when both: (1) transmitted via email to the email address listed below; and (2) sent to the physical address listed below by either being deposited in the United States mail, postage prepaid, or deposited for overnight delivery, charges prepaid, with an established overnight courier that provides a tracking number showing confirmation of receipt.
In the case of CPA, to:
Name/Title: Theodore Bardacke, Chief Executive Officer
Address: 801 S. Grand Ave., Suite 400, Los Angeles, CA 90017 Telephone: (213) 376-4850
Email: [email protected]
In the case of Contractor, to:
Name/Title: Pat Benner, Chief Financial Officer
Address: 1877 Broadway Ave., Suite 606, Boulder, CO 80203 Telephone: 303-993-2773
Email: [email protected]
13. Assignment
Neither this Agreement nor any of the Parties’ rights or obligations hereunder may be transferred or assigned without the prior written consent of the other Party; provided, however, provided, however, that either Party may assign its rights or delegate its obligations, in whole or in part, without such consent, to an entity that acquires all or substantially all of the business or assets of such Party to which this Agreement pertains, whether by merger, reorganization, acquisition, sale, or other operation of law. Subject to the preceding sentence, this Agreement shall be binding upon and inure to the benefit of the Parties and their respective successors and permitted assigns.
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9 14. Subcontracting
Contractor may not subcontract Services to be performed under this Agreement without the prior written consent of CPA, which will not be unreasonably withheld. If the CPA’s written consent to a subcontract is not obtained, Contractor acknowledges and agrees that CPA will not be responsible for any fees or expenses claimed by such subcontractor.
15. Retention of Records and Audit Provision
Contractor and any subcontractors authorized by the terms of this Agreement shall keep and maintain on a current basis full and complete documentation and accounting records, employees’ time sheets, and correspondence pertaining to this Agreement. Such records shall include, but not be limited to, documents supporting all income and all expenditures.
CPA shall have the right, during regular business hours, to review and audit all records relating to this Agreement during the Agreement period and for at least five (5) years from the date of the completion or termination of this Agreement at CPA’s sole expense.
Contractor shall provide all such records within a maximum of fifteen (15) days upon receipt of written notice from CPA. Contractor shall have an opportunity to review and respond to or refute any report or summary of audit findings and shall promptly refund any overpayments made by CPA based on undisputed audit findings.
16. Conflict of Interest
a. No CPA employee whose position with the CPA enables such employee to influence the award of this Agreement or any competing Agreement, and no spouse or economic dependent of such employee, shall be employed in any capacity by the contractor or have any other direct or indirect financial interest in this Agreement. No officer or employee of the Contractor who may financially benefit from the performance of work hereunder shall in any way participate in the CPA’s approval, or ongoing evaluation, of such work, or in any way attempt to unlawfully influence the CPA’s approval or ongoing evaluation of such work.
b. Contractor shall comply with all conflict of interest laws, ordinances, and regulations now in effect or hereafter to be enacted during the term of this Agreement. The Contractor warrants that it is not now aware of any facts that create a conflict of interest. If the Contractor hereafter becomes aware of any facts that might reasonably be expected to create a conflict of interest, it shall immediately make full written disclosure of such facts to CPA. Full written disclosure shall include, but is not limited to, identification of all persons implicated and a complete description of all relevant circumstances. Failure to comply with the provisions of this paragraph shall be a material breach of this Agreement.
17. Publicity
Contractor shall not issue a press release or any public statement regarding the Agreement, Services contemplated by this Agreement, or any other related transaction unless CPA has agreed in writing the contents of any such public statement.
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10 18. Governing Law, Jurisdiction, and Venue
This Agreement shall be governed by, and construed in accordance with, the laws of the State of California. The Contractor agrees and consents to the exclusive jurisdiction of the courts of the State of California for all purposes regarding this Agreement and further agrees and consents that venue of any action brought hereunder shall be exclusively in the County of Los Angeles.
19. Amendments
None of the terms and conditions of this Agreement may be changed, waived, modified or varied in any manner whatsoever unless in writing duly signed by the Parties.
20. Severability
Should any provision of this Agreement be held invalid or unenforceable by a court of competent jurisdiction, such invalidity will not invalidate the whole of this Agreement, but rather, the remainder of the Agreement which can be given effect without the invalid provisions, will continue in full force and effect and will in no way be impaired or invalidated.
21. Complete Agreement
This Agreement constitutes the entire Agreement between the parties. No modification or amendment shall be valid unless made in writing and signed by each party. Failure of either party to enforce any provision or provisions of this Agreement will not waive any enforcement of any continuing breach of the same provision or provisions or any breach of any provision or provisions of this Agreement.
22. Counterparts
This Agreement may be executed in one or more counterparts, including facsimile(s), emails, or electronic signatures, each of which shall be deemed an original and all of which together will constitute one and the same instrument IN WITNESS WHEREOF, the parties have executed this Agreement on the date first above written.
[Signature Page Follows]
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11 Yes Energy, LLC Clean Power Alliance of Southern California ____________________________________ ____________________________________ By: By: Theodore Bardacke
Title: Title: Chief Executive Officer
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Exhibit A – Scope of Work
PROJECT TASKS AND DELIVERABLES
Contractor shall be responsible for providing a comprehensive settlements software product, implementation services, and training services.
Contractor must account for the following tasks and all tasks must be completed according to the timelines set forth below:
Task #1: Software Settlements Product
Provide subscription access for eight (8) named user licenses to Contractor’s PowerCore Platform as further described in Exhibit D.
1. Licenses shall include access to the following modules:
1.1. PowerCoreTM base platform.
1.2. ISO Downloader module (CAISO).
1.3. Shadow Settlements module (CAISO).
1.4. Meter module (submit meter data to CAISO).
1.5. Allocations module (disaggregate all CAISO charge codes to resources with a quantity/price/amount).
1.6. Settlement Analyzer module (compare any two CAISO settlements to each other or CAISO vs. shadow settlements).
1.7. eTag - Reporting Only module (out-of-the-box integration for receiving Etag data to use in shadow and reporting).
1.8. What-If Shadow Settlements module (template for users to populate parameters for a full shadow settlements run to perform what-if shadow settlements analysis).
1.9. Visual Analytics (CAISO) - used to visualize the CAISO data.
2. Subscription access includes:
2.1. Power Settlements Support, including unlimited phone and online support via JIRA.
2.2. PowerCoreTM software updates.
2.3. Contractor shall provide 100% of the support and maintenance of the PowerCoreTM system. This includes all deployments of the PowerCoreTM system, bug fixes, configurations, communicating directly with end-users, etc. Includes phone and email support during the regular business hours set forth in Attachment A.
2.4. Contractor shall provide 100% of the support of future CAISO market changes that affect functionality currently in place or subsequently implemented in the licensed PowerCoreTM modules. For example, this would include EDAM, DAME, etc. whereby Power Settlements would include the update to the PowerCoreTM system to comply with all CAISO market changes.
2.5. Includes support for 1 PROD and 1 TEST MS Azure environments.
2.6. Daily processing services.
Task #1 Deliverables:
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1. Subscription access for eight (8) named user licenses to Contractor’s PowerCore Platform as set forth in Task #1 above.
Timeline for Task #1:
1. The license term shall begin on the Effective Date.
Task #2: Cloud Services and Hosting
Contractor shall provide a hosted cloud deployment of the CAISO settlement system.
1. Contractor shall provide 100% of the MS Azure hosting environment, including database backups, antivirus updates, cyber security initiatives, etc.
2. The hosting environment will be for a test environment and a production environment.
3. 100% of the system administration will be completed by Contractor.
4. CPA may opt to perform its own system administration function if it desires, such as adding/removing users, adding new resources, etc. Contractor shall provide such system administration training if requested by CPA.
Task #2 Deliverables:
1. Setup of the cloud infrastructure including but not limited to provisioning of virtual servers, storage, and networking.
2. Deployment of software and applications.
3. Setup of test environment and provide user access to perform user acceptance testing (“UAT”).
Timeline for Task #2:
1. Cloud hosting shall be provided on an ongoing basis throughout the term of the Agreement.
2. Setup of test environment is to be completed by December 31, 2025.
3. Setup of production environment is to be completed by January 31, 2026.
Task #3: Operational Support and Maintenance
Provide ongoing operational support and maintenance services as further set forth in Exhibit D, Attachment I (Service Level Agreement), including:
1. Business resiliency. Develop processes and protocols to ensure critical operations are maintained during emergency events and that proper failover mechanisms are in place.
This includes documented disaster recovery plans, backup systems in multiple US regions, and cybersecurity compliance.
2. Performance metrics and service level agreements (“SLAs”). As set forth in Exhibit D, Attachment I (Service Level Agreement).
3. At the end of the Initial Term or any Renewal Terms data will be extracted in the PowerCore database format to flat files. All CAISO invoices, statements, and bill determinant files will be provided in their original CAISO XML format.
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Task #3 Anticipated Deliverables:
1. Provide a business resiliency plan per Section 1.
2. Transfer and transition of CPA Data from the Product as directed by CPA.
Timeline for Task #3:
1. The business resiliency plan per Section 1 is to be submitted to CPA no later than 12:00 p.m. PST on December 19, 2025.
2. Setup of notification process and customer support process is to be completed by January 31, 2026.
Task #4: Implementation Services
1. Provide project management for the successful implementation of the PowerCore System for CPA.Contractor will assign a project management lead and assistant to lead this implementation project. The project management leads will be responsible for:
1.1. Project planning.
1.2. Timely communications and coordination of work efforts with the CPA project lead.
1.3. Status reporting.
1.4. Risk assessment, risk mitigation and issue management.
1.5. Managing implementation project schedule and resources.
1.6. Management of vendor project deliverables.
1.7. Management of go-live and post go-live transition to support and maintenance.
2. Conduct weekly project status meetings throughout the life cycle of the project.
2.1. Conducted via MS Teams (or similar online meeting system) or on-site (as needed).
2.2. Attendees include project management leads as well as key project team members from both Contractor and CPA.
2.3. Agenda covers review of status for tasks, schedule and deliverables as well as issues and resolution action plan.
2.4. Status meeting minutes detailing discussion and agreed action item assignments provided for each meeting. Contractor shall not use virtual meeting recording or virtual meeting transcription.
3. The delivery methodology for the system implementation for CPA will follow Contractor’s product-project management best practices and can be summarized in five (5) project stages which incorporate the Agile Methodology applied to the development life cycle:
3.1. Discovery and analysis.
3.1.1. System design. The discovery and analysis of CPA’s business requirements is a key determinant to a successful system delivery and will be a collaborative effort between CPA and Contractor. The goal of this project phase is to gain a deep understanding of the CPA’s operations, needs and wants and to work with CPA’s subject matter experts (“SMEs”) to identify and document the business requirements for the system, perform “Gap” analysis, and develop a solution document to meet requirements. Throughout this project phase, Contractor will leverage its knowledge of the CAISO market and work with CPA to identify the business needs and translate those needs into functional and technical solution design documents. Once the functional and technical designs have been
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completed, Contractor will develop a detailed plan for implementation of the design.
3.1.2. Data requirements. This phase of the project will look at CPA internal systems’ inputs, outputs, capabilities, and gaps while also analyzing CPA’s existing business processes and procedures to design effective and efficient data interfaces between PowerCore and CPA internal systems and will be executed in coordination with CPA’s Data and Systems team. Contractor will study and understand CPA’s systems, and also the overall business processes and procedure where the PowerCore will reside. The CAISO system includes CAISO data interfaces as standard base functionality. New and/or updated interfaces resulting from CAISO’s 2024 / 2025 release initiatives will be analyzed and incorporated in system design and delivery.
3.2. Software installation and configuration.
3.2.1. Contractor’s technical leads will work with CPA’s technical leads and project management to develop a blueprint for installation that meets the technical requirements for the delivered system. This project task will run concurrently with the discovery and analysis of business requirements. The on-premises or Azure hosted environment database and applications server setup processes should be initiated as early as possible as the availability of environment is a pre-requisite for the initial installation of base software and system configuration. Contractor will perform all third party and system software installations and updates throughout the project, including developing all interfaces/integrations with the CAISO API.
3.3. Testing and training.
3.3.1. UAT shall be conducted to verify that the delivered system meets the requirements of the delivery project and is production ready to move to CAISO production. The UAT scope will include the PowerCore modules, customizations and interfaces that comprise CPA’s CAISO system delivery.
CPA’s staff will be primarily responsible for execution of UAT test cases and performance test with Contractor supporting where needed for any connectivity issues, bugs/issue reporting and tracking and software updates and deployment. CPA’s approval of UAT and performance test is requisite to initiation of parallel operations and ultimately production go-live.
3.4. Go-live.
3.4.1. The technical teams from CPA and Contractor will collaborate to develop a cutover/go live plan that is mutually acceptable. The plan will describe resource assignments, timing, and tasks required for production cutover to PowerCore CAISO system. CPA will have the lead responsibility for the cutover plan; however, Contractor will provide input and review of the plan. CPA and Contractor’s project managers will also review and must approve the plan for cutover. The cutover plan will specify a freeze date at which time no other changes will be introduced. CPA will be responsible for assessing the final results UAT and system readiness, accepting the system, and completing cutover to production.
3.5. Post go-live and support.
3.5.1. Contractor will provide support during the production cutover.
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4. Contractor’s project management team will maintain a log of all issues reported and current status throughout the project. The issue log will be shared with CPA. The project management lead for this project will be the point of contact for any issue escalation from CPA project management or executive management.
5. Contractor’s project management team will closely monitor all project work streams, both internally and jointly with CPA’s project management to identify any risks that could impede the ability to meet those milestones. Any risks to the project schedule or budget will be reported to CPA project management with suggested strategy for mitigation.
6. Perform due diligence to capture application errors and breaking changes using automated unit tests and functional tests. In addition, regression tests are performed by Contractor’s QA person(s) against the final code prior to release.
7. Code deployments are performed by Contractor on their hosted server. Changes are first deployed on a non-production server, go through UAT, planned for production cutover, and cutover date is communicated to the users. Release notes are provided with each release and include all applicable Jira reference numbers and descriptions.
8. All user-reported issues, via phone or email, shall be logged with an issue tracking number which is emailed to the users. Once an issue is resolved, the user shall be provided an updated email with the resolution of the issue.
Task #4 Deliverables:
1. Completion of the implementation activities set forth in Task #4 above.
Timeline for Task #4:
1. Completion of implementation services no later than February 1, 2026.
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Exhibit B – Contractor’s Workplan and Schedule
The implementation services set forth in Task #4 shall follow the project plan set forth below:
Task Name Duration Start Finish
CPA SettleCore Project Implementation 136 days Fri 9/5/25 Fri 3/13/26 Project Start 0 days Fri 9/5/25 Fri 9/5/25
Project Initialization 2 days Fri 9/5/25 Mon 9/8/25
Prepare Initial Project Documentation 1 day Fri 9/5/25 Fri 9/5/25 Project Kick Off Meeting 1 day Mon 9/8/25 Mon 9/8/25
Scoping 15 days Tue 9/9/25 Mon 9/29/25
Obtain CAISO Certificates 1 day Tue 9/9/25 Tue 9/9/25
Identify Customizations (Reports/Functions)
Development 10 days Tue 9/9/25 Mon 9/22/25
Identify Any Interfaces (Etag forwarding,
Internal meter, meter submission) 5 days Tue 9/23/25 Mon 9/29/25 Base Product Configuration 48 days Fri 9/5/25 Tue 11/11/25 Standup Hosted MS Azure Platform 10 days Fri 9/5/25 Thu 9/18/25 IP Whitelisting 10 days Fri 9/19/25 Thu 10/2/25
Setup SAML for Single Sign On 10 days Fri 10/3/25 Thu 10/16/25 Install Standard Base System - SettleCore
System (Test environment ) 5 days Fri 10/17/25 Thu 10/23/25 Install CAISO Certificates 2 days Fri 10/24/25 Mon 10/27/25 Populate Base System Test Data 5 days Fri 10/24/25 Thu 10/30/25 Test Data Flow in SettleCore 5 days Tue 10/28/25 Mon 11/3/25 User Accounts Setup 5 days Tue 11/4/25 Mon 11/10/25
Conduct User System Connectivity Testing 1 day Tue 11/11/25 Tue 11/11/25 E-Tag Data 35 days Fri 9/5/25 Thu 10/23/25
CPA Examines E-Tag Data Exchange 20 days Fri 9/5/25 Thu 10/2/25 CPA (SC) Updates the E-Tag Registry for Tag
Forwarding 10 days Fri 10/3/25 Thu 10/16/25
Test Data Flow in SettleCore 5 days Fri 10/17/25 Thu 10/23/25 Integration 18 days Tue 9/30/25 Thu 10/23/25
Deploy Required Interfaces 18 days Tue 9/30/25 Thu 10/23/25 Client Specific Workflows 15 days Fri 10/24/25 Thu 11/13/25 Deploy Client Specific Workflows and Reports 15 days Fri 10/24/25 Thu 11/13/25 Training 9 days Wed 11/12/25 Mon 11/24/25
Develop Training Material - CAISO Settlements 3 days Wed 11/12/25 Fri 11/14/25 Deliver User Training Session - CAISO
Settlements 5 days Mon 11/17/25 Mon 11/24/25
Acceptance Testing 20 days Tue 11/25/25 Mon 12/22/25
Site Acceptance Testing 5 days Tue 11/25/25 Mon 12/1/25 User Acceptance Testing 15 days Tue 12/2/25 Mon 12/22/25 Market Trials / Parallel Operations 25 days Tue 12/23/25 Mon 1/26/26 Parallel Operations 23 days Tue 12/23/25 Mon 1/26/26
Go-live 9 days Tue 1/27/26 Fri 2/6/26
Develop Go Live/Cutover Plan 3 days Tue 1/27/26 Thu 1/29/26
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APPROVE: Accept System & Cutover Plan -
CAISO Settlements 3 days Fri 1/30/26 Tue 2/3/26
Go Live Production Cutover - CAISO
Settlements 3 days Wed 2/4/26 Fri 2/6/26
Post Go Live - Hyper Care 25 days Mon 2/9/26 Fri 3/13/26 Post Go-Live Scheduled Patch for Bug Fixes
and Enhancements 20 days Mon 2/9/26 Fri 3/6/26
Project Close 5 days Mon 3/9/26 Fri 3/13/26
Project Management 133
days Fri 9/5/25 Fri 3/13/26
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Exhibit C – Compensation
Contractor shall satisfactorily provide all the contemplated Services detailed in Exhibit A at the fixed price per deliverable specified in the table below and in compliance with the terms and conditions of this Agreement.
Initial Term (September 5, 2025 – December 31, 2026)
Phase 1 (September 5, 2025, to December 31, 2025)
Contract (Task) Item Estimated Due Date Maximum
Authorized Fees
Task 1: Software Settlements Product $79,374
Task 2: Cloud Services and Hosting Included
Task 3: Operational Support and
Maintenance Included
Task 4: Implementation Services
Upon completion of
the Base Product
Configuration as set
forth in Exhibit B,
estimated by
November 11, 2025 $150,000
Expenses, if approved in advance, in writing, by CPA $0 Initial Term Phase 1 Maximum Authorized Fees: $229,374
Phase 2 (January 1, 2026, to December 31, 2026)
Task 1: Software Settlements Product $245,000
Task 2: Cloud Services and Hosting Included
Task 3: Operational Support and
Maintenance
January 1, 2026
Included
Expenses, if approved in advance, in writing, by CPA $0 Initial Term Phase 2 Maximum Authorized Fees: $245,000
Initial Term: Maximum Authorized Fees $474,374
First Renewal Term (January 1, 2027 – December 31, 2027) Contract (Task) Item Estimated Due
Date
Maximum
Authorized Fees
Task 1: Software Settlements Product $249,000
Task 2: Cloud Services and Hosting Included
Task 3: Operational Support and Maintenance
January 1, 2027
Included
Expenses, if approved in advance, in writing, by CPA $0 First Renewal Term: Maximum Authorized Fees $249,000
Second Renewal Term (January 1, 2028 – December 31, 2028) Contract (Task) Item Estimated Due
Date
Maximum
Authorized Fees
Task 1: Software Settlements Product $253,500
Task 2: Cloud Services and Hosting Included
Task 3: Operational Support and Maintenance
January 1, 2028
Included
Expenses, if approved in advance, in writing, by CPA $0 Second Renewal Term: Maximum Authorized Fees $253,500
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Any travel, administrative expenses, and materials (hereinafter, “Expenses”) will be billed in the amount incurred by Contractor for actual out-of-pocket cost, without any additional mark-up by Contractor. Any Expenses incurred shall be billed for the month in which the Expenses are incurred. Expense reports detailing all Expenses, along with receipts, shall be presented to CPA for reimbursement. All expenses must be approved by CPA in advance writing before they are incurred.
Maximum Authorized Expenses $0
The Total Maximum Amount that CPA shall pay Contractor, including any subcontractor that the Contractor may retain, for all Services and Expenses to be provided under this Professional Services Agreement shall not exceed Four Hundred Seventy-Four Thousand Three Hundred Seventy-Four Dollars ($474,374) ("Not-to-Exceed" or "NTE") during the Initial Term.
The one-time implementation fee, including license, installation, configuration, training, and go-live support shall be invoiced upon completion.
Initial Term: Maximum Amount Up to and Not to Exceed $474,374 The Total Maximum Amount that CPA shall pay Contractor, including any subcontractor that the Contractor may retain, for all Services [and Expenses] to be provided under this Professional Services Agreement shall not exceed Two Hundred Forty-Nine Thousand Dollars ($249,000) ("Not-to-Exceed" or "NTE") during the First Renewal Term, if authorized.
First Renewal Term: Maximum Amount Up to and Not to Exceed $249,000 The Total Maximum Amount that CPA shall pay Contractor, including any subcontractor that the Contractor may retain, for all Services [and Expenses] to be provided under this Professional Services Agreement shall not exceed Two Hundred Fifty-Three Thousand Five Hundred Dollars ($253,500) ("Not-to-Exceed" or "NTE") during the Second Renewal Term, if authorized.
Second Renewal Term: Maximum Amount Up to and Not to Exceed $253,500 Contractor shall satisfactorily perform and complete, in the judgement of CPA, all required Services in accordance with Exhibit A notwithstanding the fact that total payment from CPA shall not exceed the NTE.
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Exhibit D – Contractor’s License and Software Services
Agreement
LICENSE AND SOFTWARE SERVICES AGREEMENT (NON-EXCLUSIVE) This LICENSE AND SOFTWARE SERVICES AGREEMENT (this “Agreement”) is made and entered into this 5th day of September 2025, by and between Yes Energy LLC (hereinafter “Power”); and Clean Power Alliance of Southern California(hereinafter “Licensee”). Power and Licensee may be referred to individually as a “Party” and collectively as the “Parties” within this Agreement.
RECITALS
WHEREAS, Licensee and Power are entering into this License and Software Services Agreement (Non-Exclusive) for Licensee’s use of the Software and Software services; and WHEREAS, Power is the owner of all right, title and interest in and to the Software, Documentation, Code, Maintenance Modifications, Enhancements, and related information, including the intellectual property rights embodied therein, which is altogether known as the SettleCore System (collectively the “Software”) and as further defined in Section 1.1, below; and WHEREAS, Licensee desires to install and operate the Software pursuant to the rights and licenses granted herein for Licensee’s non-exclusive use of the Software, and use of the Documentation and related information for permissible purposes; and WHEREAS, Licensee desires that Power provide additional daily processing and support and maintenance services to remotely operate the Software as Software Services as further described in Attachment A (the “Software Services”), attached hereto and incorporated by reference herein; and
WHEREAS, Power is willing to grant such rights and licenses under the terms and conditions of this Agreement.
NOW, THEREFORE, the Parties hereto, intending to be legally bound, hereby agree as follows:
Article 1
DEFINITIONS
When used in this Agreement the capitalized terms listed below shall have the following meanings:
1.1 “Software” means “CAISO SettleCore Software” as such term is defined in Attachment B, which is attached hereto and incorporated herein by this reference.
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1.2 “Code” means computer programming code. If not otherwise specified, Code shall include both Object Code and Source Code. Code shall include Maintenance Modifications and Enhancements thereto if, when, and to the extent that such Maintenance Modifications and/or Enhancements are delivered to Licensee by Power under this Agreement or under any other agreement or arrangement between the Parties.
1.3 “Source Code” means code in programming languages such as “C#” and “JavaScript”, including all database operations and procedures such as “SQL” and “SQL stored procedures”, plus all related development documents such as flow charts, schematics, statements of principles of operations, end-user manuals, architectural standards, and any other specifications that are used to create or that constitute the Software. Source Code shall also include the database tables and their design and layout, which are used by the Software.
1.4 “Object Code” means code in machine-readable form generated by compilation of Source Code and contained in a medium that permits it to be operated by Licensee. Object Code shall also include the database and database design and layout provided in the Software.
1.5 “Documentation” means user manuals and other written materials that relate to particular Object Code, including materials useful for operation (for example, user guides and training materials). Documentation shall include Maintenance Modifications and Enhancements thereto if, when, and to the extent that such Maintenance Modifications and/or Enhancements are delivered to Licensee by Power under this Agreement or under any other agreement or arrangement between the Parties.
1.6 “Maintenance Modifications” means modifications, updates, or revisions made by Power to Code or Documentation that correct errors, support new releases of operating systems, or support new models of input-output (“I/O”) devices with which the Code is designed to operate.
1.7 “Enhancements” means modifications, additions, or substitutions, other than Maintenance Modifications, made by Power to Code or Documentation that accomplish incidental, performance, structural, or functional improvements. Enhancements may consist of Basic Enhancements or Major Enhancements, as defined below:
a. For purposes of this Agreement, “Basic Enhancements” means Enhancements that result from maintenance services or that otherwise accomplish incidental, structural, functional, or performance improvements for which Power generally does not impose a separate charge on Licensee.
b. For purposes of this Agreement, “Major Enhancements” means Enhancements that result in substantial performance, structural, or functional improvements or additions, including substantial redesign or replacement of any parts of the Source Code, for which Power generally does impose a separate charge on Licensee, but which Licensee has the option of rejecting and not receiving the Major Enhancement and such additional charge.
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1.8 “Dollars” means U.S. Dollars.
1.9 “Regular Business Hours” means “Regular Business Hours” as such term is defined in Attachment A.
Article 2
LICENSE
2.1 Grant. In consideration of the fees payable to Power pursuant to Article 5 hereof, and subject to the terms and conditions of this Agreement, Power hereby grants to Licensee a revocable, non-sublicensable, non-transferable (except in compliance with Section 12.15), non-exclusive limited right and license (the “License”) to use and operate the Software.
2.2 Restrictions. Licensee agrees to the restrictions on the Software contained in Attachment C, which is attached hereto and incorporated herein by this reference. Failure to adhere to these restrictions may result in the revocation of the License at the sole and unilateral discretion of Power with or without notice to Licensee, except as specifically set forth herein.
2.3 Feedback. If Licensee or any of its employees or contractors sends or transmits any communications or materials to Power by mail, email, telephone, or otherwise, suggesting or recommending changes to the Software, including without limitation, new features or functionality relating thereto, or any comments, questions, suggestions, or the like (“Feedback”), Power is free to use such Feedback and Licensee hereby assigns to Power on Licensee’s behalf, and on behalf of its employees, contractors and/or agents, all right, title, and interest in, any ideas, know-how, concepts, techniques, or other intellectual property rights contained in the Feedback, for any purpose whatsoever, although Power is not required to use any Feedback.
Article 3
SOFTWARE MAINTENANCE
3.1 Generally. Power shall perform software maintenance and support as further detailed in Attachment A.
Article 4
SOFTWARE SERVICES
4.1 Generally. Power shall perform software services as further detailed in Attachment A.
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Article 5
PAYMENTS
5.1 Software License Fee. The license fee that is assessed by Power to Licensee for the license of the Software (the “Software License Fee”) will not be assessed by Power to Licensee in consideration of the Software Services Fee.
5.2 Software Implementation Fee. In consideration of the implementation of the Software, as described in Attachment E, which is attached hereto and incorporated herein by this reference, Licensee shall pay a Software Implementation Fee which shall be defined and further described in Attachment E.
5.3 Software Services Fee. For the Term of the Agreement and any subsequent extensions to the Term of the Agreement, Licensee shall pay an annual Software Services Fee, which such Software Services Fee shall be defined and further described in Attachment F, which is attached hereto and incorporated herein by this reference.
5.5 Medium of Payment. All payments due hereunder are payable in U.S. Dollars.
5.6 Payment Due Dates; Late Fees; Interest.
a. Section Not Used.
b. Software Implementation Fee. Licensee shall pay to Power a Software Implementation Fee as described in Section 5.2 with the payment due dates specified in Attachment E.
c. Software Services Fees. Licensee shall pay to Power an annual Software Services Fee as described in Section 5.3, with the payment due dates specified in Attachment F. d. Hosting Fee. Licensee shall pay to Power for Hosting Fee as described in Section 5.9, with the payment due dates specified in Attachment G, which is attached hereto and incorporated herein by this reference.
e. Late Fees; Interest. In the event that any payment due to Power is not paid within five days of its due date, a late fee of two percent (2%) of the amount owed shall be due and payable to Power. Additionally, interest at the rate of three percent (3%), or the greatest amount authorized by applicable law, per annum shall accrue on the unpaid payment from the date due until paid.
5.7 Discount to the Payment. The Software Services Fee is subject to a discount, which such discount is further described in Attachment H, which is attached hereto and incorporated herein by this reference.
5.8 Travel Costs. When traveling to Licensee’s office, Power will charge the actual travel costs incurred without any markup. These fees include but are not limited to airfare, hotel,
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car rental, taxi service, parking, and a daily per diem for mealsbased on GSA rates.. Power will only incur travel related expenses after receiving written approval via email from Licensee for travel to Licensee’s office. Licensee will be responsible for the payment of the travel costs within thirty (30) days of being invoiced by Power.
5.9 Reserved.
5.10 Hosting Fee. For the Term of the Agreement and any subsequent extensions to the Term of the Agreement, Licensee has elected to have the Software installed in an off-premise hosted environment, such as through Microsoft Azure or another hosting provider, and Licensee shall be responsible for payment of an annual fixed fee associated with the hosting costs (the “Hosting Fee”), which such Hosting Fee shall be as further described in Attachment G. Licensee will use Power’s Microsoft Azure, or another hosting provider selected by Power and approved by Licensee, for the hosting services. Licensee will be responsible for payment of all invoices relating to the Hosting Fee within thirty (30) days of being invoiced by Power.
5.11 Sales Tax. In the event that a municipal, county, state, or federal instrumentality or agency levies a sales or use tax on software or services provided by Power to Licensee under this Agreement, then Licensee shall be responsible for the payment of all such sales or use taxes. To the extent that sales or use tax on software or services provided by Power to Licensee under this Agreement is levied, if and only if Power collects sales or use tax in the state of the license, then Power will bill same to Licensee and separate out the sales or use tax on the invoice and Licensee will pay the sales or use tax amount to Power, and Power will then remit the same amount to the instrumentality or agency that levies the sales or use tax. If Power is not registered in the state of the license to collect sales or use tax then Licensee will remit the sales or use tax directly to the applicable governmental authority.
Article 6
AUDITS
6.1 Audit Procedure. Power may periodically, upon Power’s request, with reasonable notice, and at its own expense inspect and audit Licensee’s use of the Software under this Agreement at any time during the Term. Licensee shall make available all such equipment, information and personnel, and provide such cooperation and assistance, as may reasonably be requested by Power with respect to such audit. Requests for audit shall not exceed one request every two years.
6.2 Results of Audit. If the audit determines that Licensee’s use of the Software does not comport with the usage permitted by this Agreement and/or Licensee’s obligations under this Agreement, including without limitation the restrictions set forth in Attachment C, Licensee shall take immediate steps to bring itself into compliance with the Agreement.
Licensee’s failure to do so will constitute grounds for Power to terminate the Agreement for cause as set forth in Article 9.
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Article 7
CONFIDENTIAL INFORMATION
7.1 Confidential Information. The term “Confidential Information” means all information in the possession of and being disclosed by a Party (the “Disclosing Party”) pursuant to this Agreement to the other Party (the “Receiving Party”), which has value to the Disclosing Party (or to a third party to whom the Disclosing Party in possession owes a duty of confidentiality), which is not generally known in the industry, and which is known or should be known to the Receiving Party to be of a confidential nature. By example and without limitation, Confidential Information includes any and all information concerning teaching techniques, processes, software, database designs, formulas, trade secrets, inventions, discoveries, improvements, research or development and test results, specifications, data, know-how, formats, marketing plans, business plans, strategies, forecasts, unpublished financial information, budgets, projections, and customer and supplier identities, characteristics, and agreements.
7.2 Non-Confidential Information. Notwithstanding the other provisions of this Agreement, nothing received by Receiving Party from the Disclosing Party will be considered to be Confidential Information if (i) it has been published or is otherwise readily available to the public other than by a breach of this Agreement; or (ii) it has been rightfully received by the Receiving Party from a third party without confidential limitations.
7.3 Protection of Confidential Information. During the Term of this Agreement and for five (5) years thereafter, each Party agrees to take all steps reasonably necessary to hold in trust and confidence the Disclosing Party's Confidential Information. Each Party agrees to hold such Confidential Information in strict confidence, and not to disclose it to third parties or to use it in any way, commercially or otherwise, other than as permitted under this Agreement. Except as set forth in Section 7.2, each Party agrees not to allow any unauthorized person access to such Confidential Information, either before or after termination of this Agreement, without the prior written consent of the Disclosing Party and without court order or regulatory requirement. Each Party agrees to limit the disclosure of Confidential Information to employees or independent contractors with a need to know, who have been advised of the confidential nature thereof, and have acknowledged in writing the express obligation to maintain such confidentiality. Receiving Party further agrees to promptly notify the Disclosing Party of any unauthorized use or disclosure of Confidential Information and to take all reasonable steps in cooperation with the Disclosing Party to prevent further unauthorized use or disclosure.
Notwithstanding any other provisions of this Agreement, the Receiving Party’s obligations under this Article 7 with respect to any Confidential Information that constitutes a trade secret under any applicable law will continue until such time, if ever, as such Confidential Information ceases to qualify for trade secret protection under one or more such applicable
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laws other than as a result of any act or omission of the Receiving Party or any of its representatives.
7.4 Compelled Disclosures. If either Party or any of its Representatives is compelled by applicable law or regulatory requirement to disclose any Confidential Information of the other Party then, to the extent permitted by applicable law, the receiving Party shall: (a) promptly, and prior to such disclosure, notify the disclosing Party in writing of such requirement so that the disclosing Party can seek a protective order or other remedy or waive its rights under Section 7.3; and (b) provide reasonable assistance to the disclosing Party in opposing such disclosure or seeking a protective order or other limitations on disclosure. If the disclosing Party waives compliance or, after providing the notice and assistance required under this Section 7.4, the receiving Party remains required by law to disclose any Confidential Information, the receiving Party shall disclose only that portion of the Confidential Information that the receiving Party is legally required to disclose.
Article 8
REPRESENTATIONS AND WARRANTIES
8.1 Mutual Representations and Warranties. Each Party represents, warrants and covenants to the other Party that:
(a) it is duly organized, validly existing and in good standing as a corporation or other entity under the laws of the jurisdiction of its incorporation or other organization; (b) it has the full right, power and authority to enter into and perform its obligations and grant the rights, licenses and authorizations it grants and is required to grant under this Agreement;
(c) the execution of this Agreement by its representative whose signature is set forth at the end of this Agreement has been duly authorized by all necessary corporate or organizational action of such Party; and
(d) when executed and delivered by both Parties, this Agreement will constitute the legal, valid and binding obligation of such Party, enforceable against such Party in accordance with its terms.
8.2 Power’s Representations and Warranties.
a. Right and Authority. Power represents and warrants that:
(i) it is the owner of the Software and Documentation (including all intellectual property rights therein under copyright, patent, trademark, trade secret, and other applicable law);
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(ii) it has the full and sufficient right and authority to grant the rights and licenses granted herein;
(iii) the Software and Documentation have not been published under circumstances that have caused loss of any U.S. copyright therein; and
(iv) the Software and Documentation, to the best of Power’s knowledge, do not infringe any copyright or other intellectual property right of any third party. b. Adequacy of Software and Documentation. Power represents and warrants that:
(i) the Software and Documentation are and shall be reasonably understandable and reasonably usable by the Licensee’s users.
c. Conformity, Performance, and Compliance. Power represents and warrants that:
(i) the Software to be delivered by Power hereunder have been prepared in a workmanlike manner and with professional diligence and skill, (ii) such Software will reasonably function on the machines and with operating systems for which they are designed, as further explained in Attachment A, and (iii) such Software conform to the specifications and functions relating thereto.
8.4. Limitation of Warranties. Power does not assume any responsibility for any processes performed by Licensee utilizing the Software or the Software Services. Power shall not be deemed to make, or to have made, any express or implied warranties of any kind, character or description, including, but not limited to, fitness for a particular purpose or the warranty of merchantability concerning the Software or the Software Services, except as expressly stated in this Agreement.
Article 9
TERM
9.1 Term of Agreement. The initial term (“Initial Term”) of this Agreement shall commence on September 5, 2025 (“Effective Date”) and shall continue until December 31, 2026 Subject to Section 9.2, after the end of the Initial Term, and after the end of each subsequent one (1) year period (each a “Renewal Term”), this Agreement will automatically renew for an additional Renewal Term unless either Party has provided written notice to the other Party at least ninety (90) days prior to the expiration of the then-current Term that the Agreement shall not be automatically renewed. The Initial Term and each Renewal Term collectively make up the “Term” of this Agreement. Except as expressly provided otherwise under this Agreement, all fees provided for under this Agreement are fully
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earned by Power when due and payable hereunder and are not subject to refund or offset notwithstanding the early termination of this Agreement by either Power or Licensee.
9.2 Termination. This Agreement may be terminated upon the occurrence of any of the following events:
a. Termination by Mutual Agreement. Licensee and Power may terminate or modify the terms of this Agreement by written agreement executed by both Parties. b. Termination For Cause. In addition to the foregoing, a Party may terminate this Agreement at any time for just cause, herein defined as the happening of any of the following occurrences or acts:
(i) A receiver for a Party is appointed or applied for, or a petition under any bankruptcy chapter is filed by or against a Party, or a Party becomes insolvent or makes an assignment for the benefit of creditors, or is unable to pay its debts as they become due, or, if there is any levy, attachment or similar action that is not vacated or removed by payment or bonding within ten (10) days of such levy or attachment; or
(ii) A Party is charged with unethical or illegal practices or acts thereby jeopardizing, in the opinion of the other Party, that other Party’s good name and good will; or
(iii) A Party fails to perform a material condition or delegation of this Agreement that adversely and substantially affects the interests of the other Party.
Termination For Cause may be affected through written notice to the breaching party, specifically identifying the breach on which termination is based and such termination shall be effective (a) immediately if it is incapable of cure; or (b) if capable of cure, such breach remains uncured 30 days after written notice thereof. c. Upon early termination for any reason, Licensee shall be refunded on a prorated basis any Software Services Fees pre-paid in advance for services not used as of the date of termination.
9.3 Survival. In the event of the expiration or termination of this Agreement, in whole or in part, the provisions of Articles 7, 8, 10, and 11 shall survive and continue in effect.
Article 10
LIMITATIONS ON LIABILITY
10.1 Exclusion of Consequential Damages, Etc. IN NO EVENT SHALL EITHER PARTY
BE LIABLE TO THE OTHER FOR ANY CONSEQUENTIAL, INDIRECT, SPECIAL,
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OR INCIDENTAL PUNITIVE, OR CONSEQUENTIAL DAMAGES ARISING OUT OF
OR RELATED TO THIS AGREEMENT, INCLUDING BUT NOT LIMITED TO
FAILURES OR LIMITATIONS OF THE SOFTWARE OR SOFTWARE SERVICES,
LOSS, DAMAGE, CORRUPTION OR RECOVERY OF DATA, OR BREACH OF DATA OR SYSTEM SECURITY, OR MICROSOFT AZURE OUTAGES OR AUTH0
OUTAGES, EVEN IF SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY
OF SUCH POTENTIAL DAMAGES, WITHOUT LIMITATION, WHETHER BASED ON CONTRACT, TORT, OR ANY OTHER LEGAL THEORY.
10.2 Limit on Damages. EXCEPT FOR LIABILITY OF POWER TO LICENSEE WITH REGARD TO SETTLEMENT OPERATIONS SUPPORT SERVICE, EACH PARTY’S
AGGREGATE LIABILITY UNDER THIS AGREEMENT SHALL BE LIMITED TO TWO TIMES (2X) THE SOFTWARE SERVICES FEES PAID BY LICENSEE TO POWER DURING THE TWELVE (12) MONTHS PRIOR TO THE DATE SUCH CLAIM AROSE. POWER AND LICENSEE ACKNOWLEDGE AND AGREE THAT
POWER SHALL HAVE NO LIABILITY TO LICENSEE FOR ANY LIABILITIES,
CLAIMS, FEES, DAMAGES, OR OTHER COSTS ARISING FROM OR RELATING TO SETTLEMENT OPERATIONS SUPPORT SERVICES.
10.3 Reserved.
Article 11
INDEMNIFICATION
11.1 Indemnification by Licensee. Licensee shall indemnify, defend, and hold harmless Power and its officers, directors, shareholders, members, employees, agents, representatives, and customers (collectively, “Power Indemnitee”) against all liability, claims, costs, damages, and expenses incurred by Power Indemnitee relating to or arising from: (a) a claim that Licensee’s use or combination of the Software with any hardware, software, system, network, service or other matter whatsoever that is neither provided by Power nor authorized by Power in this Agreement (including the Documentation), infringes any patent, copyright, trademark, trade secret, or other proprietary right of a third party; (b) a breach by Licensee of any representation, warranty, covenant or obligation under this Agreement; (c) negligence, abuse, misapplication, misuse or more culpable act or omission (including recklessness or willful misconduct) by or on behalf of Licensee or any of its Representatives with respect to the Software or Documentation or otherwise in connection with this Agreement; or (d) use of the Software or Documentation by or on behalf of Licensee or any of its Representatives that is outside the purpose, scope or manner of use authorized by this Agreement or the Documentation, or in any manner contrary to Power’s instructions.
11.2 Indemnification by Power. Power shall indemnify, defend, and hold harmless Licensee and its officers, directors, shareholders, members, employees, agents, representatives, and customers (collectively, “Licensee Indemnitee”) against all liability, claims, costs, damages, and expenses incurred by Licensee Indemnitee relating to or arising from a third-
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party claim: (a) that the Software, or any use of the Software in accordance with this Agreement (including the Documentation), infringes any patent, copyright, trademark, trade secret, or other proprietary right of a third party; (b) based on a breach by Power of any representation, warranty, covenant or obligation under this Agreement; or (c) based on negligence, abuse, misapplication, misuse or more culpable act or omission (including recklessness or willful misconduct) by or on behalf of Power or any of its Representatives with respect to the Software or Documentation or otherwise in connection with this Agreement, including without limitation failure to appropriately service, support, or maintain the Software during the term of this Agreement.
Notwithstanding the foregoing, Power will have no obligation under this Agreement to indemnify or defend a Licensee Indemnitee against an intellectual property infringement claim relating to or arising from: (a) open-source components or other third-party materials; (b) incorporation by the Software of, or combination, operation or use of the Software in or with, any technology (including any software, hardware, firmware, system or network) or service not provided by Power or specified for Licensee’s use in the Documentation or this Agreement, unless otherwise expressly permitted by Power in writing; (c) modification, support, or maintenance of the Software other than: (i) by Power in connection with this Agreement; or (ii) with Power’s express written authorization and in strict accordance with Power’s written directions and specifications; (d) failure to timely implement any Maintenance Release, modification, update or replacement of the Software made available to Licensee by Power; (e) use of the Software after Power’s notice to Licensee of such activity’s alleged or actual infringement, misappropriation or other violation of a third party’s rights; (f) negligence, abuse, misapplication or misuse of the Software or Documentation by or on behalf of Licensee; (g) use of the Software or Documentation by or on behalf of Licensee that is outside the purpose, scope or manner of use authorized by this Agreement or in any manner contrary to Power’s instructions; or (h) events or circumstances outside of Power’s commercially reasonable control (including any third-party hardware, software or system bugs, defects or malfunctions).
11.3 Indemnification Procedure. Each Party shall promptly notify the other Party in writing of any Action for which such Party believes it is entitled to be indemnified pursuant to Section 11.1 or Section 11.2. The Party seeking indemnification (the “Indemnitee”) shall cooperate with the other Party (the “Indemnitor”). The Indemnitor may in its sole discretion take control of the defense and investigation of such Action and employ counsel of its choice to handle and defend the same. The Indemnitee may participate in and observe the proceedings at its own cost and expense with counsel of its own choosing.
Article 12
MISCELLANEOUS
12.1 Freedom of Action. This Agreement shall not be construed to limit Licensee’s right to obtain services or software programs from other sources, nor shall this Agreement be construed to limit Power’s right to grant others any further non-exclusive right or license of the Software and Documentation. This Agreement alone establishes the rights, duties,
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and obligations of Licensee and Power with respect to the subject matter hereof. Licensee shall have no right or interest whatsoever in any software of Power other than the rights and licenses in the Software and Documentation granted herein, whether such software is conceived or developed by Power before, during, or after the course of Power’s performance of this Agreement.
12.2 Independent Contractor. With respect to all duties performed by Power pursuant to this Agreement, Power shall be deemed to be an independent contractor.
12.3 Rights and Obligations After Notice of Termination. If Power gives notice of termination of this Agreement, or if it becomes known that this Agreement will otherwise terminate in accordance with its provisions, Licensee shall return to Power all Software, Documentation, and other items of property owned by Power forthwith.
12.4 Notices. Unless otherwise stated herein, all notices or other communications required or permitted hereunder shall be in writing including email form, and shall be personally delivered including through email or sent by registered or certified mail, postage prepaid, return receipt requested, delivered or sent by overnight courier and shall be deemed received upon the earlier of: (i) If personally delivered or delivered through email, the date of delivery to the address of the person to receive such notice; (ii) If mailed, three (3) business days after the date of posting by the United States post office; and (iii) If sent by overnight courier, when delivered to the specified address.
To Power: Yes Energy, LLC
1877 Broadway
Suite 606
Boulder, CO 80302
Telephone Number: (303) 993 2773
Facsimile: N/A
Electronic Mail: Pat Benner [email protected]
To Licensee: ______________________
______________________
______________________
Notice of change of address shall be given by written notice in the manner detailed in this section. Rejection or other refusal to accept, or the inability to deliver because of changed address of which no notice was given, shall be deemed to constitute receipt of the notice, demand, request or communication.
12.5. Required Actions of Power and Licensee. Power and Licensee agree to effectuate the intent of this Agreement.
12.6 Captions. Any captions to, or headings of, the section or subsections of this Agreement are solely for the convenience of the Parties hereto, are not a part of this Agreement and
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shall not be used for the interpretation or determination of the validity of this Agreement or any provision hereof.
12.7 No Obligations to Third Parties. Except as otherwise expressly provided herein, the execution and delivery of this Agreement shall not be deemed to confer any rights upon, nor obligate any of the Parties hereto, to any person or entity other than the parties hereto.
12.8 Amendment. The terms of this Agreement may not be modified or amended except by an instrument in writing executed by each of the Parties hereto.
12.9 Waiver. The waiver or failure to enforce any provision of this Agreement shall not operate as a waiver of any future breach of any such provision or any other provision hereof.
12.10 Applicable Law. The terms and provisions of this Agreement shall be governed by and construed in accordance with the laws of the State of Colorado without regard to its conflicts of laws' provisions.
12.11 Entire Agreement. This Agreement, including the RECITALS, attachments, and Attachments hereto, supersedes any prior agreements, negotiations and communications, oral or written, and contains the entire agreement between Power and Licensee as to the subject matter hereof. No subsequent agreement, representation or promise made by either Party hereto, or by or to any employee, officer, agent or representative of either Party shall be of any effect unless it is in writing and executed by the Party to be bound thereby.
12.12 No Presumption. Each provision of this Agreement has been independently and freely negotiated by both Parties as if this Agreement were drafted by both Parties. In the event of any ambiguity in this Agreement, the Parties waive any presumption or rule requiring or permitting interpretation of said ambiguity against or in favor of either Party.
12.13 Severability. If any provision of this Agreement is held invalid or unenforceable, the remainder of this Agreement shall nevertheless remain in full force and effect. If any provision is held invalid or unenforceable with respect to particular circumstances, it shall nevertheless remain in full force and effect in all other circumstances.
12.14 Attorney’s Fees. If any legal action is taken to enforce the terms of this Agreement by any Party, the prevailing Party shall be entitled to recover reasonable attorney fees and other costs and expenses incurred in connection with that legal action.
12.15 Binding on Successors; Assignment. This Agreement will bind and inure to the benefit of each Party’s permitted successors and assigns. Neither Party may assign this Agreement without the advance written consent of the other Party, which shall not be unreasonably withheld or delayed, except that either Party may assign this Agreement in connection with a merger, reorganization, acquisition or other transfer of all or substantially all of such Party’s assets or voting securities. Any attempt to transfer or assign this Agreement except as expressly authorized under this Section will be null and void.
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12.16 Reserved.
12.17 Reserved.
12.18 Insurance. During the Term, Power shall maintain the insurance coverages and comply with the requirements set forth on attached Attachment I, which is attached hereto and incorporated herein by this reference.
12.19 Force Majeure. In no event shall either Party be liable to the other Party, or be deemed to have breached this Agreement, for any failure or delay in performing its obligations under this Agreement (except for any obligations to make payments), if and to the extent such failure or delay is caused by any circumstances beyond such Party's reasonable control, including but not limited to acts of God, flood, fire, earthquake, other potential disaster(s) or catastrophe(s), such as epidemics, explosion, war, terrorism, invasion, riot or other civil unrest, strikes, labor stoppages or slowdowns or other industrial disturbances, or passage of law or any action taken by a governmental or public authority, including imposing an embargo.
12.20 Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be deemed to be an original, and all such counterparts shall constitute one and the same agreement. This Agreement may be executed via facsimile or electronic transmission.
12.21 Attachments. The following documents are attached hereto and incorporated into and made a part of this Agreement:
Attachment A Software Services
Attachment B Definition of CAISO SettleCore Software
Attachment C License Restrictions
Attachment D RESERVED
Attachment E RESERVED
Attachment F RESERVED
Attachment G RESERVED
Attachment H RESERVED
Attachment I Service Level Agreement
[Signature Page and Attachments to Follow]
[Remainder of this Page is Intentionally Blank]
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IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the day and year first above written.
POWER: Yes Energy, LLC
By:____________________________________
Printed Name: ___________________________
Title: __________________________________
Date:
LICENSEE: Clean Power Alliance of Southern California
By:____________________________________
Printed Name: ___________________________
Title: __________________________________
Date:
[Attachments to Follow]
[Remainder of this Page is Intentionally Blank]
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ATTACHMENT A – SOFTWARE SERVICES
On the terms and subject to the conditions set forth below, Power and Licensee hereby enter into this Attachment A – Software Services (“Attachment A”) and agree that this Attachment A is incorporated into, made subject to, and governed by the provisions of the Agreement. In the event of any conflict, ambiguity, or inconsistency between this Attachment A and the Agreement or any other document that is part of the Agreement, the terms of this Attachment A shall control.
Article 1
SOFTWARE SERVICES
For purposes of this Attachment A, “Regular Business Hours” means from 8:00 a.m. to 6:00 p.m.
Pacific Prevailing Time on Regular Business Days. For purposes of this Attachment A, “Regular Business Days” means all weekdays, excluding federal and Power Recognized Holidays. For purposes of this Attachment A, “Power Recognized Holidays” shall be New Year’s Day, Memorial Day, Independence Day, Labor Day, Thanksgiving Day, Christmas Eve, and Christmas Day.
1.1 Software Services. Power shall provide the following daily Software services to the Licensee on each Regular Business Day:
a. Ensure that the CAISO ISO Downloader has downloaded the Licensee’s CAISO files (or the CAISO files of those entities to which Licensee is assigned as scheduling coordinator by CAISO) (see definition of “CAISO ISO Downloader Module”); and b. Ensure that all settlement jobs have been completed (see definition of “Daily Processing Service”); and
c. Run and successfully complete Shadow Settlements and Validations routines (see definition of “Daily Processing Service”); and
d. Communicate, via email or verbally, with a Licensee user that the Software Service has been performed.
1.2 Limitation of the CAISO Software Services. Power shall provide the CAISO Software Services within the following manner:
a. Power is not required to perform a minimum number of hours to complete the Software Services.
b. Power shall perform the Software Services, offsite, through a secure connection.
1.3 CAISO Software Service Software Maintenance and Support. Power shall provide the Software Maintenance Software Services, as described below:
a. Power shall perform all Software Maintenance Modifications for the Licensee, provided that Power shall only perform the Software Maintenance Modifications in
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one Production environment and one Test environment.
Power shall deliver to Licensee an updated version of the Software at any time that CAISO initiates a change that impacts existing functionality of one of Licensee’s licensed modules of the Software. Enhancements relating to future CAISO market changes that affect the existing Software are Basic Enhancements, excluding the introductions of new CAISO markets or other ISO markets or RTO markets.
b. Power shall deliver to Licensee, when and as prepared by Power in the course of its business, all Basic Enhancements and Maintenance Modifications arising from time to time, for inclusion in the Software. However, Major Enhancements will not be included within the Software or Software Services.
c. If Licensee reports an error in the functionality of the Software (a “Bug”), and Power verifies the validity of the Bug, Power shall include a Bug fix in a future delivery of the Software to Licensee, on a schedule to be determined on a mutually agreed timeframe. Further, from time to time, in the sole and absolute discretion of Power, Power shall issue updated versions of the Software that include Bug fixes for Bugs identified by Power or customers of Power other than Licensee. d. Prior to the completion of the initial installation of the Software, remotely or at the Licensee’s site, Power shall provide the Licensee with the level of training reasonably required to operate the Software, including administrator training.
Article 2
SUPPORT OBLIGATIONS CLOUD HOSTED DEPLOYMENT
2.1 Obligations of the Licensee. The Software will be deployed in an Azure hosted environment that will be maintained by Power. In order for Power to perform the Software Services and for the Software to function as required, the Licensee shall be required to fulfill the following obligations. Failure of the Licensee to meet the obligations below, (1) may result in adverse performance of the Software and Software Services, and (2) shall not relieve the Licensee of any obligations of payment for the Software License Fee and/or Software Services Fees for the Term.
a. Each client that accesses the server with the Software shall have the following hardware:
(1) a processor, which shall be a dual-core processor or a higher version, (2) have a minimum of eight gigabytes of RAM, and (3) a hard drive with at least twenty gigabytes of free space.
b. Each client that accesses the server with the Software shall have the following software:
(1) an operating system that is one of the following: Microsoft Windows 2016 or Windows 10 or higher, (2) the Microsoft .Net Framework version 4.6.1 or a higher version, (3) the Chrome browser, and (4) Microsoft Excel 2007 or higher version. c. Licensee shall be responsible for providing a minimum bandwidth of 0.5 Mbps on the
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connection to the Software at all times.
d. Licensee shall be responsible for providing a secure connection to the Azure environment in which the Software is deployed.
e. Licensee shall be responsible for providing the certificates required by the CAISO to access the files that are downloaded by the SettleCore Software.
2.2 Support Hours. Power shall be reasonably available to provide support to Licensee during Regular Business Hours.
a. During Regular Business Hours, Power shall be available for Licensee’s users via email at [email protected]
b. During Regular Business Hours, Power shall be available for Licensee’s users via telephone at Power’s office phone number 626.385.6893 extension 1.
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ATTACHMENT B – DEFINITION OF CAISO SETTLECORE SOFTWARE
On the terms and subject to the conditions set forth below, Power and Licensee hereby enter into this Attachment B – Definition of CAISO SettleCore Software (“Attachment B”) and agree that this Attachment B is incorporated into, made subject to, and governed by the provisions of the Agreement. In the event of any conflict, ambiguity, or inconsistency between this Attachment B and the Agreement or any other document that is part of the Agreement, the terms of this Attachment B shall control.
1.1 “CAISO SettleCore Software.” SettleCore System for the CAISO Market is comprised of the CAISO ISO Downloader Module, the CAISO Visual Analytics Module, the SPP IM Settlements Analyzer Module, the CAISO Shadow Settlements Module, and the CAISO Allocations Module. The SettleCore System for the CAISO market is further described in Attachment A, and is used to interface with the CAISO. Software is comprised of Object Code and Documentation that is installed on a server(s) and accessed by the users on client computers.
“CAISO Visual Analytics Module.” The functionality within the CAISO SettleCore Software that is used to graphically view Licensee’s CAISO resources and their components, including schedule, meter, dispatch, and deviation in an historical and a near real-time screen.1.3 “Etag Reporting-only Module.” The functionality within the SettleCore System that is used by Purchase Selling Entities (“PSEs”) to view and report on electronic tagging (“Etagging” or “Etag”). This module includes the functionality to view Etags for North American bulk power transactions that are scheduled between balancing authorities, as required by NERC. This module does not create, submit, or edit Etags. This module includes the ability to extract Licensee’s Etag data through the Software screens and reports as well as through the Software Application Programmatic Interfaces (“APIs”) as described in the User Documentation. This module requires the Licensee to have Tag Forwarding available from their primary Etag vendor for submitting Etags, in order to utilize this module.
Includes up to 3 of Licensee’s PSEs.
1.4 “ISO Downloader Module.” The functionality within the CAISO SettleCore Software that is used to download from the CAISO APIs and interfaces the Licensee’s (including entities to which Licensee is assigned as the scheduling coordinator by the CAISO) SIBR, CMRI, Master File, MRI-S, OASIS, ADS, and OMS files, in the CAISO-issued XML format, and to export the data to spreadsheets.
1.5 “CAISO Meter Submission Module.” The functionality within the SettleCore System that is used to submit meter data to the CAISO’s MRI-S system.
1.2 1.6 “CAISO Shadow Settlements Module.” The functionality within the CAISO SettleCore Software that is used to “shadow” (i.e., independently produce) an estimate and/or validation of a CAISO settlement file and to identify potentially disputable transactions, which occur when the shadow estimates do not match the CAISO settlement file charges and payments.
1.3 1.7 “CAISO Allocations Module.” The functionality within the CAISO SettleCore Software that is used to disaggregate the CAISO’s charge codes, which are settled by the
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CAISO at the scheduling portfolio level. This module disaggregates these charge codes to the Licensee’s scheduling coordinator’s resources, to enable the users to review the charge code quantity, price, and amount by resource at the charge code’s time interval.
1.4 1.8 “CAISO What-If Shadow Settlement Module.” The functionality within the SettleCore system that is used to enable Licensee’s users to import a pre-defined template with their provided “what-if” values that are then used in the shadow settlements routine to produce a what-if shadow settlement that may be compared to either the results of the CAISO Shadow Settlements Module or the CAISO settlement file charges and payments.
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ATTACHMENT C – LICENSE RESTRICTIONS
On the terms and subject to the conditions set forth below, Power and Licensee hereby enter into this Attachment C – License Restrictions (“Attachment C”) and agree that this Attachment C is incorporated into, made subject to, and governed by the provisions of the Agreement. In the event of any conflict, ambiguity, or inconsistency between this Attachment C and the Agreement or any other document that is part of the Agreement, the terms of this Attachment C shall control.
Restrictions. Licensee agrees to the following restrictions on the Software:
a. Reserved.
b. Licensee may not reproduce or transfer the Software, or any copy, adaptation, transcription, or merged portion thereof, except as expressly permitted in writing by Power. Licensee’s rights are non-exclusive and non-assignable. If Licensee transfers possession of any copy, adaptation, transcription, or merged portion of the Software to any other Party, including, but not limited to, a successor in interest of Licensee’s business that assumes all of the Licensee’s obligations with respect to the Software, the Licensee’s rights in the Software are automatically terminated. c. Reserved.
d. Licensee does not and will not have or acquire under or in connection with this Agreement any ownership interest in the Software. Power is and will remain the sole and exclusive owner of all right, title, and interest in and to the Software and all modifications, customizations, and enhancements thereof (including ownership of all trade secrets and copyrights pertaining thereto and/or any rights in derivative works or improvements relating thereto), subject only to the rights and privileges expressly granted by Power hereunder.
e. By accepting delivery of the Software Licensee acknowledges that Power claims and reserves all rights and benefits that are afforded under federal copyright law in the Software.
f. The Source Code for the Software (and the information therein, excluding all of Licensee’s data from the CAISO downloaded by the CAISO ISO Downloader Module into the Software’s database(s), to the extent not otherwise apparent in the Object Code and the Documentation) is a trade secret of Power. Licensee is not entitled to receive Source Code, and under no circumstances may Licensee reverse-compile or reverse-assemble the Object Code. g. Licensee’s obligations hereunder remain in effect for as long as it continues to possess or use the Software.
h. Licensee shall not modify, correct, adapt, translate, enhance or otherwise prepare derivative works or improvements of any Software, nor make any updates to the
Agenda Page 139
database used by the Software, including but not limited to updates to the data, tables, layouts, or schema, as long as the Term of this Agreement is in effect. i. Licensee agrees that only employees of the Licensee or Licensee’s affiliates, and those contractors of Licensee to whom Power agrees (and Power shall not withhold such agreement unless the contractor is in Direct Competition with Power), shall be permitted to operate the Software and to access the database used by the Software. Any requests to operate the Software, or to access the database used by the Software, by non-employees of the Licensee (including but not limited to consultants or other agents), must be approved by Power in writing (with email being acceptable). For purposes of this section, “Direct Competition” means that the vendor owns and offers for sale its software product or software service that provides substantially similar features or functionality as the Software provides and is provided by the vendor for the same intended use. Direct Competition includes but is not limited to the following companies: Power Costs Inc. (www.powercosts.com), Open Access Technology International, Inc. (www.oati.com), Adapt2 Solutions (www.adapt2solutions.com), Hartigen (www.hartigen.com), MCG Energy Solutions (www.mcgenergy.com), and Czarnecki-Yester Consulting Group (www.cycg.com).
j. Reserved.
k. Licensee agrees that Licensee’s Software users will not share Software accounts with any other individuals. Each Software user shall have their own login and password. l. Licensee agrees that if the Agreement (i) expires, or (ii) is Terminated as further described in Section 9.2 of the Agreement, that the Software license is immediately revoked as of the expiration or termination date, and that the Licensee must permit Power to immediately uninstall the Software, including any and all copies. m. Reserved.
n. Licensee may access its data through either the screens and reports accessible to Software users through the web-browser user interface or through the APIs as described in the Documentation.
o. Licensee must abide by the terms in the Software Documentation for querying or submitting data using the Software APIs.
p. Reserved.
q. Reserved.
r. Reserved.
s. Licensee shall use the License only for the benefit of Licensee, in the course of its normal internal business activities, and not in competition with Power.
Agenda Page 140
t. In the event that this Agreement expires or is terminated per the conditions in Section
9.2, or the Licensee fails to pay any fees for a period of 60 days after such fee is due, then Power shall not have any obligation to provide any support or maintenance of the Software to Licensee (including but not limited to Maintenance Modifications, Enhancements, Software Services, and Software Maintenance. u. Licensee is responsible for providing the CAISO Scheduling Coordinator certificates that the SettleCore – ISO Downloader Module will use to download Licensee’s CAISO data into the SettleCore System.
v. Additional Software Services Fees will be required for additional markets, ISOs, or RTOs. The ISO Downloader Module includes the license and fees for only the CAISO market and does not include the CAISO Western EIM market. w. Licensee is responsible for configuring the Contract Billing Module contracts after go-live and after the first ten (10) Contracts. Further, Licensee is responsible for payment of any additional fees for Power to configure additional contracts after go-live and/or for Power to maintain contracts after go-live.
Agenda Page 141
ATTACHMENT D – RESERVED
Agenda Page 142
ATTACHMENT E – RESERVED
Agenda Page 143
ATTACHMENT F – RESERVED
Agenda Page 144
ATTACHMENT G – RESERVED
Agenda Page 145
ATTACHMENT H - RESERVED
Agenda Page 146
ATTACHMENT I - SERVICE LEVEL AGREEMENT
On the terms and subject to the conditions set forth below, Power and Licensee hereby enter into this Attachment J – Service Level Agreement (“Attachment I”) and agree that this Attachment I is incorporated into, made subject to, and governed by the provisions of the Agreement. In the event of any conflict, ambiguity, or inconsistency between this Attachment I and the Agreement or any other document that is part of the Agreement, the terms of this Attachment I shall control.
All issues with the SettleCore Software that are reported by Licensee shall be classified in good faith by Licensee’s representative who reports the Error, based on the severity level definitions set forth below. After acknowledgment of the Error, Power and Licensee may mutually agree to assign a different severity level. If there is no Error, but another issue is impacting the SettleCore Software, then Power and Licensee will cooperate to resolve such issue in an expedited manner.
“Resolution” means any modification of the SettleCore Software that is a final solution to prevent the recurrence of the reported Error and which does not cause a different Error.
Severity
Level of
Error
Description Response Time to
Begin Working on
Issue
Resolution
Time
Target Metric
Based On
Resolution
Time
Full
System
Crash/
Disaster
Recovery
Full system
crash/failure
which requires
reinstallation and
reconfiguration of
all applications.
Within 60 minutes from
time reported to Power
support during normal
business hours
Within 90 minutes after
normal business hours,
through email to Power
support and phone call
to Power support after
hours mobile numbers
Within 48 hours • 100%
Notes: 1, 2
Critical
Priority
Errors
All users are
unable to access
SettleCore or are
unable to perform
mission critical
business
functions that are
highly time
sensitive
Within 60 minutes from
time reported to Power
support during normal
business hours
Within 90 minutes after
normal business hours,
through email to Power
support and phone call
Within 1
business day
• 100%
Notes: 1, 2
Agenda Page 147
Severity
Level of
Error
Description Response Time to
Begin Working on
Issue
Resolution
Time
Target Metric
Based On
Resolution
Time
Example: Unable
to log into the
application. All
CAISO data is
not importing.
to Power support after
hours mobile numbers
High
Priority
Errors
An individual is
unable to access
SettleCore or is
unable to perform
mission critical
business
functions that are
highly time
sensitive, or all or
multiple users are
affected, but a
workaround is
available
Bad data is
introduced into
the database due
to Power bringing
in data
incorrectly.
Example: A user
is unable to log in
to SettleCore
while other users
are able to log in;
CAISO ADS data
is not importing
into SettleCore,
etc.
Within 90 minutes from
time reported to Power
support during normal
business hours
Within 120 minutes
from the time reported
to Power support after
normal business hours,
through email to Power
support and phone call
to Power support after
hours mobile numbers
Within 2
business days
• 90%
Notes: 1, 2
Agenda Page 148
Severity
Level of
Error
Description Response Time to
Begin Working on
Issue
Resolution
Time
Target Metric
Based On
Resolution
Time
Medium
Priority
Errors
One or more
users’ ability to
perform a
SettleCore
function may be
negatively
impacted or
inconvenienced,
but the issue is
not highly time
sensitive or a
workaround
exists.
Example: A non-critical report is
timing out, etc.
Within 8 hours from
time reported to Power
support during normal
business hours
Not supported after
normal business hours
Inclusion in a
Software release
within the next 3
months.
• 70%
Notes: 1, 2
Low
Priority
Errors
An issue exists
that is
inconsequential
or unusually time
insensitive.
Example: A
misspelling is
found in
SettleCore, etc.
Within 48 hours from
time reported to Power
support during normal
business hours
Not supported after
normal business hours
Inclusion in a
Software release
within the next 6
months.
• 75%
Notes: 1, 2
Notes:
(1) The time to provide a Resolution does not begin until all requested information for troubleshooting purposes has been provided from Licensee to Power support personnel.
(2) Metric excludes items that require a new version of the Software or that require assistance from Licensee’s IT or the CAISO.
Agenda Page 149
Staff Report – Agenda Item 5
To: Board of Directors
From: Nancy Whang, General Counsel
Gabby Monzon, Clerk of the Board
Subject: Conflict of Interest Code Update
Date: September 4, 2025
RECOMMENDATION
Receive and file.
BACKGROUND/DISCUSSION
The Political Reform Act (Act) requires all public agencies in California, including Clean Power Alliance, to adopt a Conflict of Interest Code (code) that identifies all agency officials and employees who make governmental decisions and to have these individuals disclose their financial interests by filing a Statement of Economic Interests (Form 700).
CPA’s code was originally adopted by the FPPC in July 2018 and has been reviewed periodically by staff as required by the FPPC. Given the staffing updates associated with the growth of the organization, including its program offerings, the code requires an amendment to fully reflect CPA’s evolution. The proposed amendment includes administrative updates, language clean up, titles changes, and reflects any new designated positions. Disclosure categories remain unchanged.
As the FPPC is the approving authority, the amendment does not require Board approval but being provided to the Board for its information and awareness. A copy of the amendment that will be provided to the FPPC is attached.
Agenda Page 150
Board of Directors Item 5
ATTACHMENT
1. Conflict of Interest Code
Agenda Page 151
1 CLEAN POWER ALLIANCE OF SOUTHERN CALIFORNIA
CONFLICT OF INTEREST CODE
The Political Reform Act (Government Code Section 81000, et seq.) requires state and local government agencies to adopt and promulgate conflict-of-interest codes. The Fair Political Practices Commission has adopted a regulation (2 California Code of Regulations Section 18730) that contains the terms of a standard conflict-of-interest code, which can be incorporated by reference in an agency's code. After public notice and hearing, the standard code may be amended by the Fair Political Practices Commission to conform to amendments in the Political Reform Act. Therefore, the terms of 2 California Code of Regulations Section 18730 and any amendments to it duly adopted by the Fair Political Practices Commission are hereby incorporated by reference. This regulation and the attached Appendices, designating positions and establishing disclosure categories, shall constitute the conflict-of-interest code of the Clean Power Alliance of Southern California (CPAAuthority).
Officials and employees holding positions listed in this code must file their statements of economic interests electronically with the Fair Political Practices Commission. All statements must be made available for public inspection and reproduction under Government Code Section 81008.
Agenda Page 152
2 CLEAN POWER ALLIANCE OF SOUTHERN CALIFORNIA
CONFLICT OF INTEREST CODE
APPENDIX A - DISCLOSURE CATEGORIES
Designated positions must report financial interests in accordance with the assigned disclosure categories.
1. Investments and business positions in business entities, and income, including receipt of loans, gifts, and travel payments, from sources that provide services, supplies, materials, machinery, or equipment of the type utilized by CPAthe Authority.
2. Interests in real property located within the jurisdiction of CPA the Authority or within two miles of the boundaries of the jurisdiction of CPAthe Authority, or within two miles of any land owned or used by CPAthe Authority.
3. Investments and business positions in business entities, and income, including receipt of loans, gifts, and travel payments, from sources that engage in the design, development, construction, sale, or the acquisition of facilities that generate electricity, including, wind, solar, geothermal, hydroelectric, ocean, garbage, and biomass.
4. Investments and business positions in business entities, and income, including receipt of loans, gifts, and travel payments, from sources that are energy or environmental consultants, research firms, or engineering firms, entities that design, build, manufacture, sell, distribute, or service equipment of the type that is utilized by electric power suppliers, including, wind, solar, geothermal, hydroelectric, ocean, garbage, and biomass, or any entity that is, or within the past 12 months has been, party to a CPA n Authority proceeding before any local, state, or regional regulatory or judicial entity.
Agenda Page 153
CLEAN POWER ALLIANCE OF SOUTHERN CALIFORNIA
CONFLICT OF INTEREST CODE
APPENDIX B - DESIGNATED POSITIONS
Designated Positions Disclosure Category
Member of the Board of Directors and Alternates 1, 2, 3, 4 Alternate Member of the Board of Directors 1, 2, 3, 4
Executive DirectorChief Executive Officer 1, 2, 3, 4
General Counsel 1, 2, 3, 4
Director, Finance, Rates, Admin 1, 2
Director, Power Planning and Procurement 1, 2, 3, 4
Director Technology Integration and Data Analytics 1, 2, 3, 4 Director, Marketing & Customer Programs 1
Director Legislative and Regulatory Affairs 1, 2, 3, 4
Director (All Levels) 1,2,3,4
Manager (All Levels) 1,2,3,4
Accountant (All Levels) 1,2,3,4
Administrator (All Levels) 1,2,3,4
Advisor (All Levels) 1,2,3,4
Analyst (All Levels) 1,2,3,4
Assistant (All Levels) 1,2,3,4
Assistant General Counsel 1,2,3,4
Associate (All Levels) 1,2,3,4
Chief Administrative Officer 1,2,3,4
Chief Financial Officer/Treasurer 1,2,3,4
Chief Operating Officer 1,2,3,4
Clerk of the Board (All Levels) 1,2,3,4
Data and Systems Architect (All Levels) 1,2,3,4
Data Scientist (All Levels) 1,2,3,4
Agenda Page 154
Deputy Clerk of the Board (All Levels) 1,2,3,4
Engineer, Data & Systems (All Levels) 1,2,3,4
Executive Assistant to the Chief Executive Officer
(All Levels)
1,2,3,4
Office Manager (All Levels) 1,2,3,4
Paralegal (All Levels) 1,2,3,4
Program Coordinator (All Levels) 1,2,3,4
Program Manager (All Levels) 1,2,3,4
Project Manager (All Levels) 1,2,3,4
Resource Planner, Power Supply (All Levels) 1,2,3,4
Strategic Accounts Executive (All Levels) 1,2,3,4
Systems Administrator (All Levels) 1,2,3,4
Vice President (All Levels) 1,2,3,4
Visual Storyteller, Graphic Design and Web Design
(All Levels)
1,2,3,4
Website Developer, Communications and Marketing
(All Levels)
1,2,3,4
Consultants/New Positions* *
*Consultants/New Positions are included in the list of designated positions and shall disclose pursuant to the broadest disclosure category in the code, subject to the following limitations:
The Executive Director Chief Executive Officer may determine in writing that a particular consultant or new position, although a "designated position," is hired to perform a range of duties that is limited in scope and thus is not required to fully comply with disclosure requirements in this section. Such written determination shall include a description of the consultant's or new position's duties and, based upon that description, a statement of the extent of disclosure requirements. The Chief Executive Director's Officer’s determination is a public record and shall be retained for public inspection in the same manner and location as this conflict-of-interest code. (Gov. Code Section 81008.)
Note: The position of General Counsel is filled by an outside consultant, but acts in a staff capacity for the Authority.
Agenda Page 155
The following positions are NOT covered by the conflict-of-interest code because they must file under Government Code Section 87200 and, therefore, are listed for informational purposes only:
Treasurer
An individual holding one of the above listed positions may contact the Fair Political Practices Commission for assistance or written advice regarding their filing obligations if they believe that their position has been categorized incorrectly. The Fair Political Practices Commission makes the final determination whether a position is covered by Government Code Section 87200.
Agenda Page 156
Staff Report – Agenda Item 6
To: Board of Directors
From: Gabby Monzon, Clerk of the Board
Natalie Baerlocher, Senior Manager, Load Forecasting & Analytics Approved By: Ted Bardacke, Chief Executive Officer
Subject: Receive and File Annual Electricity Usage by Jurisdiction Date: September 4, 2025
RECOMMENDATION
Receive and file.
BACKGROUND/DISCUSSION
Per CPA’s Joint Powers Agreement, in the case of a weighted (voting shares) vote by the CPA Board of Directors, voting shares are based on CPA’s overall retail load served by jurisdiction in the previous year. Attachment 1 shows the annual retail load by jurisdiction for FY2024/25. These percentages will be used in the event of a voting shares vote during FY2025/26. A voting shares vote may be called for by a minimum of three members of the Board of Directors following an affirmative vote of the Board via the standard “one member, one vote” voting procedure. A voting shares vote may only be used to invalidate an affirmative vote by the Board.
For the three cities that will begin service in October 2025, load is projected based on historic load data provided by Southern California Edison and adjusted for expected opt-out levels.
ATTACHMENT
1. FY 2024/25 Annual Load by Jurisdiction
Agenda Page 157
Board of Directors Item 6
Jurisdiction Annual Retail Load (KWH) for
July 1, 2024 to June 30, 2025
Percent
of Total
LOS ANGELES, COUNTY OF 3,025,802,375 27.8%
CARSON, CITY OF 535,119,271 4.9%
OXNARD, CITY OF 477,068,186 4.4%
SANTA MONICA, CITY OF 473,463,648 4.4%
THOUSAND OAKS, CITY OF 440,655,137 4.1%
SIMI VALLEY, CITY OF 396,012,757 3.6%
VENTURA, COUNTY OF 393,669,842 3.6%
BEVERLY HILLS, CITY OF 366,429,349 3.4%
DOWNEY, CITY OF 348,210,740 3.2%
VENTURA, CITY OF 347,558,732 3.2%
WHITTIER, CITY OF 299,834,667 2.8%
CAMARILLO, CITY OF 286,625,323 2.6%
HAWTHORNE, CITY OF 278,833,996 2.6%
ARCADIA, CITY OF 265,692,786 2.4%
ALHAMBRA, CITY OF 250,659,402 2.3%
CULVER CITY, CITY OF 236,305,955 2.2%
WEST HOLLYWOOD, CITY OF 233,010,834 2.1%
REDONDO BEACH, CITY OF 204,222,849 1.9%
LYNWOOD, CITY OF * 178,407,340 1.6%
LA CANADA FLINTRIDGE, CITY OF * 172,081,817 1.6%
MONROVIA, CITY OF 164,643,512 1.5%
PARAMOUNT, CITY OF 150,146,900 1.4%
MANHATTAN BEACH, CITY OF 145,422,197 1.3%
CALABASAS, CITY OF 142,574,954 1.3%
CLAREMONT, CITY OF 124,909,146 1.1%
MALIBU, CITY OF 114,655,258 1.1%
MOORPARK, CITY OF 114,559,917 1.1%
TEMPLE CITY, CITY OF 101,298,092 0.9%
AGOURA HILLS, CITY OF 99,129,150 0.9%
SOUTH PASADENA, CITY OF 84,887,889 0.8%
WESTLAKE VILLAGE, CITY OF 77,217,650 0.7%
SANTA PAULA, CITY OF 73,305,936 0.7%
HERMOSA BEACH, CITY OF 62,649,026 0.6%
ROLLING HILLS ESTATES, CITY OF 55,853,311 0.5%
PORT HUENEME, CITY OF * 48,833,788 0.4%
HAWAIIAN GARDENS, CITY OF 38,877,006 0.4%
SIERRA MADRE, CITY OF 38,116,774 0.4%
OJAI, CITY OF 29,891,114 0.3%
Total 10,876,636,625 100%
* Estimated load
Agenda Page 158
Staff Report – Agenda Item 7
To: Board of Directors
From: Lyon Hardgrave, Director, Energy Risk Management
Approved by: Ted Bardacke, Chief Executive Officer
David McNeil, Chief Financial Officer
Subject: Receive and File Quarterly Risk Management Team Report April 1, 2025 through June 30, 2025 (Q2 2025)
Date: September 4, 2025
RECOMMENDATION
Receive and file.
ATTACHMENT
1. RMT Quarterly Report
Agenda Page 159
Quarterly Report of Risk Management Team
April 1, 2025 through June 30, 2025 (Q2 2025)
I. Introduction
The Board of Directors of Clean Power Alliance (CPA) approved an Energy Risk Management Policy (ERMP) at its July 12, 2018 meeting, which provides the framework for conducting procurement activities in a manner that maximizes the probability of CPA meeting its portfolio, reliability, and financial goals. The ERMP has been amended on an annual basis, most recently on July 10, 2025; the scope of this report covers activities prior to those most recent amendments.
The ERMP requires quarterly reporting to the Board on the activities, projected financial performance, and general market outlook facing CPA. The Risk Management Team (RMT)1 submits this report in accordance with this requirement. Though not required by the ERMP, the RMT also reports on ERMP compliance monthly to both the Finance Committee and Energy Planning & Resources Committee.
II. Risk Management Team Activities
The RMT is responsible for implementing, maintaining, and overseeing compliance with the ERMP and for maintaining the Energy Risk Hedging Strategy. The primary goal of the RMT is to ensure that the procurement activities of CPA are executed within the guidelines of the ERMP and are consistent with Board directives. Several business practices are prescribed in the ERMP. What follows is a summary of CPA’s compliance with these practices as outlined in the Policy.
A. ERMP Acknowledgement Form
It is the policy of CPA that all CPA Representatives participating in any activity or transaction within the scope of the ERMP shall sign on an annual basis or upon any revision, a statement acknowledging compliance with the ERMP. Execution of the 2024 ERMP Acknowledgement Form was completed by relevant CPA staff, consultants and Board members.
B. Transaction Types
The ERMP includes a list of approved transaction types. All products that have been purchased or sold by CPA during the current quarterly period represent an approved transaction type as listed in Appendix C of the ERMP.
1 The RMT is comprised of CPA’s Chief Executive Officer, Chief Operating Officer, Chief Financial Officer, and Vice President, Power Supply.
Agenda Page 160
C. Counterparty Suitability
The ERMP requires that all counterparties with whom CPA transacts must be reviewed for creditworthiness and assigned a credit limit. A formal Counter Party Credit Protocol was approved by the Chief Executive Officer, in consultation with the RMT, and enacted in Q1 2019.
Pursuant to the ERMP, no counterparty credit limit may exceed $50 million unless approved in writing by the Board. CPA continues to manage counterparty credit exposures through margining and other credit enhancement requests where contractually permitted. During the quarter, no counterparty that contracted to provide electricity system hedges exceeded its credit limit.
D. System of Record
As required by the ERMP, all transactions are being stored both in CPA’s systems as well as in CPA’s Scheduling Coordinator’s (currently Tenaska Power Services, or TPS) trading and risk management system. Similarly, all transaction approvals are logged and stored on TPS’s servers, with information being made available to CPA staff via a secure web portal. The transaction record also includes the confirmation letters for each transaction.
CPA is transitioning its transaction repository to an internal data warehouse, which will provide additional functionality and security features.
E. Position Tracking and Management Reporting
To manage risk, the ERMP requires the regular production of various reports. The status of each report required by policy follows:
• Financial Model Forecast: The financial model captures projected revenues and energy and operating costs and produces various financial reports and forecasts on an accrual basis. The model uses load forecast data produced by CPA, energy contract details from CPA’s Front Office and Middle Office systems, revenue projections from CPA’s revenue model and forward prices from the ICE Data Service and TPS.
• Net Position Report: Short- and long-term net position reports are managed directly by CPA procurement staff and linked to TPS’s trade capture system or to CPA’s internal energy trading and risk management system (ETRM) for which there is a continuous improvement and enhancement process managed by the Middle Office. The short-term net position report updates daily and incorporates the current weather outlook for the next 60 days to show net positions for the current and next months. The long-term net position report assumes normal weather and shows net positions through the balance of the current year and prompt four years.
• Counterparty Credit Exposure: CPA is adhering to the credit policies included in the ERMP, with the above-mentioned market price-induced exceedances being managed by the RMT. CPA receives daily updates of counterparty credit exposures on both a notional and mark-to-market basis.
Agenda Page 161
• Monthly Risk Analysis: The ERMP requires both stress testing of financial results and probability-based assessments of future financial projections. CPA continues to implement and improve risk analysis tools to stress test financial results and validate potential hedging transactions. Recurring monthly risk analysis focuses on the prompt 12 months, while specific studies extend through calendar 2026 and beyond.
• Monthly Transaction Reporting
CPA provides monthly reporting to the Board of Directors for certain transactions executed under the delegated authority specified in Section 5.1.2. Specifically, this includes:
o Any Tolling Agreement; and
o Any transaction with a term greater than five years.
The RMT has confirmed that all transactions executed during the reporting period and subject to this requirement were reported monthly to the Board as required. • Quarterly Board Report: Subject of this report.
F. Delegation of Authority
All executed transactions during the current period have been approved consistent with the Delegation of Authority outlined in Section 5 of the ERMP.
Pursuant to Section 5.1.3 of the Energy Risk Management Policy (ERMP), the Chief Executive Officer is authorized to approve certain amendments to Board-approved long-term contracts that do not constitute “Material Changes,” as defined in the Policy. These include amendments that are minor, non-core, or administrative in nature, or that arise from counterparties effectuating or clarifying their obligations in the normal course of business (e.g., short extensions with liquidated damages, financing consents, assignments, reporting or insurance clarifications, or similar non-material adjustments).
The Chief Executive Officer is required to report to the Board any amendments approved under this Delegation of Authority on a monthly basis.
The RMT has confirmed that all transactions executed during the reporting period and subject to this requirement were reported monthly to the Board as required.
G. Limit Deviations or Business Practice Reporting
The ERMP requires that transaction volumes should not be executed that exceed the requirements of meeting CPA’s load (energy and capacity), renewable and/or carbon free energy requirements. The ERMP designates specific hedge targets for the prompt-year (PY) through the prompt plus 9-years for different product types.
Agenda Page 162
RMT reviewed the relevant hedge targets for the remainder of 2025 and beyond and identified the following policy deviations:
Policy Deviation Required Action
Beginning in June 2024, the renewable energy
hedge ratio exceeded the maximum hedge
percentage for 2027 due to the addition of
new renewable energy supply from a PPA.
Beginning in November 2024, the renewable
energy hedge ratio exceeded the maximum
hedge percentage for 2028-2030 due to a
reduction in the renewable energy product
targets that are used for long-term power
planning and position management.
None.
The deviations for 2027-2030 will resolve
themselves as CPA nears these years and
the maximum hedge percentages increase.
There are no existing or potential violations of conflicts of interest or General Conduct to report for this quarterly period.
H. Training
The ERMP acknowledges the importance of ongoing education as part of its risk management framework. Consistent with this, the ERMP outlines certain training requirements. All procurement and risk management staff, including the members of the RMT, were up to date on required training.
I. Hedging Strategy
CPA is compliant with the hedging strategy provided in Appendix A of the ERMP.
III. General Market Conditions
Southern California experienced mild weather conditions throughout much of Q2 2025.
June brought heat across the interior West, contrasted by milder weather in CPA service areas. Day ahead energy prices were lower than anticipated forward prices resulting in lower costs to serve CPA’s customer load. Prices were constrained by strong solar production, increased storage capacity, and continued favorable hydroelectric conditions in the southwest. Forward prices for energy deliveries, resource adequacy and renewable energy for 2026 and beyond declined modestly.
Agenda Page 163
Staff Report – Agenda Item 8
To: Board of Directors
From: Cara Rene, Director, Communications & Marketing
Approved By: Ted Bardacke, Chief Executive Officer
Subject: Receive and File Quarterly Communications Report Date: September 4, 2025
RECOMMENDATION
Receive and file.
ATTACHMENT
1. Communications and Marketing Quarterly Update
Agenda Page 164
Communications & Marketing
Community Engagement
Quarterly Update
May through July 2025
Plus, a look ahead
September 4, 2025
Agenda Page 165
What we’re excited about
Opened the 2025/2026 Community Benefits Grant, with $289k in remaining funds for up to 12 local nonprofit organizations advancing clean energy efforts within CPA's service area. ($50k of grant funds were previously distributed to four nonprofits providing immediate community relief in the aftermath of the Eaton and Palisades fires)
Launched a new interactive programs webpage and awareness campaign to highlight our many customers offerings
Hosted the annual Community Advisory Committee retreat, which brought CAC members together to discuss and provide feedback on CPA’s wildfire resilience efforts and engagement priorities for the upcoming mobile education center.
Participated in outreach events in each of our three new cities, as well as new events for CPA such as WeHo Pride 2025.
New Energy Team commercial began airing on broadcast television Agenda Page 166
2 CPA Brand Campaign
"Change is electric. Together, we power potential."
The 2025 brand campaign continued through May and began tapering down in June. The purpose was to elevate awareness, strengthen trust, and deepen engagement—inviting people to connect with their electricity provider and strategically positioning CPA for continued brand growth. • Meta (5/2/2025 - 8/3/2025)
• Streaming TV (4/21/2025 - 6/29/2025)
• Radio (4/5/2025-6/8/2025)
• Billboards (4/25/2025 - 8/18/2025)
• YouTube (4/14/2025-6/1/2025)
• 17M impressions
• 88% video completion rate
• 9,099 website views
Billboards
Meta
Agenda Page 167
Program Campaign
CPA launched a program awareness campaign in June to showcase the many programs available to residential and business customers.
The campaign is anchored by a new interactive program webpage that makes it easier to explore and engage with CPA's offerings. Outdoor visibility includes promotional pole banners and a future bus wrap. • Radio (KRCW and KLove) (6/30 - 8/17)
• Digital marketing (6/30 - 8/17)
• 8.8M impressions
• 24,602 website views
New program webpage Pole banners
Digital marketing
Agenda Page 168
Marketing update: Instant AC Savings
10 Launched in June 2025, the Instant AC Savings program provides income-qualified customers $300 off the purchase of a new ENERGY STAR® certified room air conditioner.
A coupon through Golden State Rebates can be claimed online and redeemed in-store at Home Depot or Lowe’s or online, helping customers upgrade to efficient cooling more easily and affordably.
• Radio (6/30-8/8, 8/18-9/26, 10/13-
10/31)
• Bus Interior Cards (7/14-8/22)
• Laundromat Posters & Window
Hangs (7/14-8/8)
• Meta (7/14-8/8, 8/18-10/31)
• Search Engine Marketing (8/25-
10/31)
• Website visitors: 4,722
• Coupons reserved: 143 Bus interior cards
Meta
Agenda Page 169
Marketing Update: EV SmartCharge
"Enroll and save money on EV charging."
Advertising and direct mail bolstered enrollment growth. • Most visited program webpage (FY 24-25 Q4).
• CPA's EV SmartCharge is now the official sponsor of the EV test track at the 2025 LA Auto Show in November.
• Meta (3/10/2025 - 11/3/2025)
• KCRW (7/28/2025 - 10/6/2025)
• PlugShare App (7/28/2025 - 11/3/2025)
• Search Engine Marketing (2/24/2025 - 11/3/2025)
• Digital Billboards (3/10/2025 - 8/25/2025)
• Podcasts (3/10/2025 - 4/14/2025, 5/5/2025 - 6/16/2025) • New users acquired: 571
• Web visits via ads and direct mail: 24,200
Agenda Page 170
Marketing Update: Sun Storage Rebate
"Stay powered, even during outages."
CPA promoted the Sun Storage Rebate program using
advertisements and direct mail, reinforcing digital outreach with a physical reminder that increases recall and response. Ads tell a story that it’s more than just hardware.
• Meta (2/3/2025 - 12/1/2025)
• Website Banners (2/3/2025 - 6/30/2025)
• Streaming Audio (4/14/2025 - 5/26/2025)
• Search Engine Marketing (6/02/2025 - 12/1/2025)
• Digital Billboards (4/14/2025 - 5/12/2025)
• Web visits via ads and direct mail: 21,694
• 51% of all Sun Storage Rebate web traffic in FY 24-25 Q4 came from users visiting the translated webpages.
Meta
Postcard
Agenda Page 171
Marketing update: Power Response Smart Home
"Save energy, earn money."
Marketing launched in late April and highlights the effect that program participants' actions have on the power grid. A layered marketing approach was the most effective way to reach diverse customer segments, reinforce key messages across channels, and drive enrollment by meeting people where they are.
• LA Times Sponsorship (4/16/2025 - 6/1/2025)
• Boiling Point podcast ad featuring interview with CPA’s program director • Boiling Point newsletter ad
• Social Media (Meta) (4/28/2025 - 11/10/2025)
• Radio (5/1/2025 - 6/29/2025)
• Search Engine Marketing (6/30/2025 - 10/27/2025)
Website visits via paid media and emails:
• Power Response: 10,245
• Smart Home: 10,537
Email
Agenda Page 172
Marketing update: Power Response Home
"Save energy, earn money."
Similar to Power Response Smart Home, a layered
paid media approach for the Power Response Home
campaign was launched in April. Marketing
highlighted the effect that program participants'
actions have on the power grid.
• Radio (KSPN) (7/28/2025 - 9/15/2025)
• Social Media (Meta) (4/28/2025 - 6/29/2025)
• Dodger Talk Podcast (5/6/2025 - 6/15/2025)
• Search Engine Marketing (6/30/2025 -
10/27/2025)
Website visits via paid media and direct mail:
• Power Response: 10,245
• Home: 9,758
Postcard
Agenda Page 173
Marketing update: Solar and Battery Access
10 Launched in April 2025, the Solar and Battery Access program provides income-qualified single-family
homeowners a solar and battery system at no cost for
purchase or installation.
May-July Engagements
• SEM (5/12-10/31)
• Streaming Audio (5/12-8/15)
• Digital Billboards (5/12-10/31)
• Radio (5/19-7/11, 8/18-9/5)
• Bus Shelters (5/26-7/25)
• Meta (5/26-10/31)
• Website visitors: 27,590 • Customer leads (as of 7/30): 903 • Solar and battery contracts signed (as of 7/30): 101 Meta
Bus Shelter
Agenda Page 174
Marketing Update: Energy Team
"One-on-one support"
CPA continued to promote and hone ad efforts for the Energy Team. • Produced creative assets that will be used to test a new messaging strategy on social media ads.
• The Energy Team commercial began airing on CBS in July and will continue through October; it will launch on Netflix this fall, and Amazon Prime in the spring.
• Search Engine Marketing (2/10/2025 - 6/30/2025)
• Radio – KHAY & KOST (5/26/2025 - 9/8/2025)
• Broadcast TV – CBS (7/21/2025 - 10/13/2025)
• YouTube (7/14/2025 - 10/6/2025)
• Streaming Audio (3/03/2025 - 3/17/2025, 5/5/2025 - 6/16/2025) • Radio (5/26/2025 - 7/7/2025)
• Web visits via ads and direct mail: 8,106
Energy Team commercial
Social media
Click to view
Agenda Page 175
Community Engagement
12 Staying active in LA and Ventura Counties
Participated in events, presentations and business
meetings including activities in each of CPA’s three
new communities
9 presentations with key stakeholders
including city councils, state elected officials,
community-based organizations and
neighborhood groups.
9 community events at street fairs, climate
awareness events, and community celebrations
allowed CPA staff and CAC members to
increase education and awareness about CPA.
2 meetings with business associations to share
program participation and relevant contracting
opportunities.
Engagements included: .
Participated in the Hueneme Beach Festival, which attracted thousands of participants over two days
Presented on wildfire resilience at the City of Claremont Mayor’s Emergency Preparedness Ad Hoc Committee
Presented with CCMERA, one of CPA’s 2024 Community
Benefit Grant Recipients, as part of their Black Business to Green Initiatives Program
Agenda Page 176
Expansion Communications
CPA created multi-tiered communications announcing the transition to service in October 2025 for the cities of Lynwood, La Cañada Flintridge and Port Hueneme. Outreach materials for each city include fact sheets, social media assets, custom webpages as well as four direct mailed notifications – all translated into multiple languages.
Social media
Downloadable fact sheets Customers notifications are mailed August, September, November and December.
Agenda Page 177
Earned Media Highlights
14 From May to July 2025, Clean Power Alliance distributed three news releases. Those releases, plus additional organic mentions, garnered a global news coverage total of $3.07M in earned media value. Sentiment remains mostly positive or netural.
Media Potential
Reach
Earned
Value
Exposure
Mentions
Print/Online 337M $3.07M 1,190
High-performing Media Outreach:
Advancing Clean Energy Equity: Clean
Power Alliance Opens 2025 Power Share
Request for Offers; audience reach of 47.4M,
8,670 views, 93 mentions
Clean Power Alliance Targets
Breakthrough Technologies and Business
Models with New Clean Energy Innovation
Solicitation; audience reach of 47.4M, 8,670
views, 160 mentions
Notable Earned Media:
LAist: LA’s first 'community solar' project of
its kind is online. What it means for clean
energy; audience reach 1.17M, 4,006 views
Spectrum News: LA's 1st community solar
project continues to grow; audience reach
4,550, 248 views
Agenda Page 178
Our Instagram page had
3 million views and
7,956 profile visits, a
5.1% increase
Added 768 new
followers, a 17%
increase over the
previous quarter
Best performing post:
Energy Team post on
June 16, which had
29,463 views, 806 post
interactions and 727
likes
Our LinkedIn page had
4,881 page views, a
16% increase, and 1,943
unique visitors, a 21.1%
increase.
Added 1,116 new
followers
Best performing post:
Workforce Development
post on May 15, with
78,914 impressions and
725 engagements
Our Facebook page had
14 million views, a 494.9%
increase, reached 1,351,670
users, a 320% increase, had
22k content interactions, and
85,914 link clicks, a 374%
increase
Added 591 followers, a
1,200% increase over the
previous quarter
Best performing post:
EV Smart Charge post on July
23 with 600k views, and 182k
accounts reached
Our X page averaged
3,200 impressions per
month, with a 4.4%
engagement rate and 1
like per day
Lost 1 follower
Best performing post:
CPA newsletter post on
May 19, which had 110
views, 5 likes and 1
retweet
Social Media Highlights
Please share CPA’s messages through your social media channels! Agenda Page 179
4 Website Performance
XXXXXXXXXXXXXXXXX
XXXXXXXXXXXXXXXXXXXX
Agenda Page 180
A Look Ahead
CPA’s EV SmartCharge program will be the official sponsor of the EV test track at the LA Auto Show in November
CPA will have live activations at three LA Galaxy games to promote Instant AC Savings, Solar and Battery Access and Power Response programs
Developing an “explainer” video about what CPA is and does to foster improved understanding about the organization’s role and impact in the region Creating a new “program finder” interactive feature on the programs webpage that will guide customers to the programs that best fit their needs in just a few clicks.
Increased outreach and engagement activities within Lynwood, La Cañada Flintridge, and Port Hueneme, with 10 events in August and September.
Agenda Page 181
Staff Report – Agenda Item 9
To: Board of Directors
From: Joanne O’Neill, Senior Director, Customer Programs Reviewed By: Matthew Langer, Chief Operating Officer
Approved By: Ted Bardacke, Chief Executive Officer
Subject: Member Agency Programs Quarterly Report
Date: September 4, 2025
RECOMMENDATION
Receive and file.
ATTACHMENT
1. Member Agency Programs Quarterly Report – Q3 2025
Agenda Page 182
Board of Directors Item 9
Member Agency Programs Quarterly Report – Q3 2025
INTRODUCTION
Clean Power Alliance (CPA) offers two programs that specifically support its member agencies: Power Ready and Energized Communities. While other programs are available to member agencies, such as Reach Codes or Power Response-Commercial Leaders, Power Ready and Energized Communities are specifically tailored to accelerating decarbonization and improving the resiliency of member agency operations. This quarterly report provides overall program status, highlights key accomplishments and challenges, and outlines goals for the next quarter for the Power Ready and the Energized Communities programs.
POWER READY
CPA’s Power Ready program is a community benefit program offered to CPA’s member agencies to support their public buildings to be energy-resilient by installing solar-plus-storage systems as a clean energy backup source that is available when a power outage occurs. CPA’s Board of Directors approved the Round 1 multi-site Power Purchase Agreement (PPA) on February 1, 2024, with Coast Energy, which is comprised of 11 backup energy systems totaling 1.15 megawatts (MW) of solar photovoltaic system capacity paired with 1.17 MW of battery energy storage system (BESS) capacity collectively.
CPA launched recruitment for Power Ready Round 2 in February and continues to seek interest from member agencies and critical community sites through November 1, 2025.
Eligible sites are those that provide continuation of critical public services (for example, emergency operations centers and fire stations) and/or a place of refuge for the community (for example, cooling centers and emergency evacuation centers) in the event of a planned or unplanned power outage event. Starting in Round 2, member agencies can also nominate a critical community site, which can include other public agencies,
Agenda Page 183
Board of Directors Item 9
special districts, and/or non-profits within their communities that provide similar emergency services to the public. Examples of critical community sites include public gathering spaces that partner with agencies during emergencies, school districts, public transit and water services, cooling centers, and other similar agency recommendations.
Interested member agencies are encouraged to email
[email protected] to schedule a program overview meeting to learn more about the Power Ready program.
Key Accomplishments
• Round 1: The developer of the Round 1 Power Ready projects, Coast Energy, issued Notices to Proceed to their Engineering, Procurement, and Construction (EPC) contractor, Newport Power, for the following four cities and participating facilities: City of Agoura Hills – Recreation Center, City of Oxnard – Service Center, City of Sierra Madre – City Hall, Fire, and Police Complex, and the City of South Pasadena – City Hall, Fire, and Police Complex. These four projects are in various stages of a) creating 10%, 30%, and 60% design drawings with reviews and approvals from the agencies, b) preparing, submitting and receiving approval for SCE’s interconnection agreements, c) and preparing and submitting permits to the agencies. All BESS projects submitted incentive applications for the Self Generation Incentive Program (SGIP) statewide program to maintain their “Conditional Reservation Letter” status and, if ultimately successful, will result in a $2,173,923 incentive total that will be allocated to offset costs of the program. • Round 2: To date, 65 member agency and community sites have expressed interest in the Power Ready Program and are in various stages of technical assessments, representing 19 different member agencies. CPA has screened and advanced 25 sites to the detailed assessment phase. The remaining sites continue to work towards completing the screening process. In addition, staff continue to prepare for the Board Retreat, where Round 2 project delivery enhancements will be discussed.
Challenges and Risks
Agenda Page 184
Board of Directors Item 9
• Projects that have received Notices to Proceed (NTP) may encounter delays during permitting reviews and interconnection application approval process. CPA and Coast Energy will be tracking these stages closely to mitigate delays where feasible and intervene where necessary.
• Negotiations of Site Lease Agreements are continuing between two member agencies and Coast Energy. Delays in executing Site Lease Agreements of the Power Ready portfolio may impact individual project timelines. The execution of a Site Lease Agreement is required for Coast Energy to issue an NTP to its EPC contractor and for Coast Energy to start the project designs, materials procurement, and construction.
• Projects that received SGIP incentive reservations will be required to demonstrate that project milestones have advanced, which include the signed Site Lease Agreements and the subsequent NTP from Coast Energy to its EPC contractor.
CPA and Coast Energy are actively exploring eligible pathways to fulfill the requirement that require enrollment and participation in a qualifying demand response program to qualify to receive SGIP funds.
• Coast Energy and CPA are actively tracking Investment Tax Credit changes and their potential impact on projects.
Goals for the Next Quarter
• Finalize remaining Site Lease Agreement negotiations and proceed to execution, including City Council or Board of Supervisor approval, where required. • Receive NTP for all projects.
• Finalize plan checks, permitting, and receive interconnection approvals for the remaining projects.
• CPA staff and technical consultant will review site submissions for Round 2 to evaluate their technical feasibility. This will result in an initial shortlist of viable sites to assess further.
Agenda Page 185
Board of Directors Item 9
Key: Black X = Selected
Black check marks = complete
Grey check marks = incomplete
Power Ready Project Status Summary: (as of August 19, 2025) Member
Agency
Site
Assessments
Complete
SGIP Incentive
Conditionally
Reserved
Site Lease
Agreement
Signed
Notice to
Proceed
Issued
Permitting &
Interconnection
Complete
Solar &
Battery
Installation
Complete
System
Testing
Complete
Permission
to Operate
Received
City of Agoura
Hills ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
City of Beverly
Hills ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
City of Oxnard ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
City of Sierra
Madre ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
City of South
Pasadena ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
City of
Westlake
Village
✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
County of Los
Angeles
(3 Projects)
✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
County of
Ventura
(2 Projects)
✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
Agenda Page 186
Board of Directors Item 9
ENERGIZED COMMUNITIES
Energized Communities offers a series of pathways to assist CPA’s member agencies implement decarbonization and sustainability projects. The Energized Communities program is made up of two parts: (1) Pathways to Electrification, offering pre-selected measures to facilitate building and vehicle electrification, and (2) an Innovation Fund to support creative decarbonization projects in our communities. Member agencies may receive up to $250,000 to implement one of the Pathways to Electrification projects and are also eligible to apply for up to $250,000 from the Innovation Fund. These pathways are described in the table below.
Pathways to Electrification Energized
Communities
Program
Building
Electrification
Assistance
Electric Fleet
Transition
Community EV
Charging
Innovation Fund
Program Goal
Install
electrification
measures in
municipal facilities
Procure vehicles
and/or install EV
charging
infrastructure for
municipal fleets
Support public EV
charging at City or
County owned
sites
Fund projects that
support local
government efforts
to achieve climate
and energy goals
# of Agencies
Participating 4 9 2 5*
*4 Participation Agreements have been executed and the 5th is pending.
Key Accomplishments
Outreach and engagement of member agencies included:
• Since the program launched in April 2024, thirty-six (36) member agencies have engaged with CPA on the Energized Communities program through briefings on the Pathways to Electrification projects, participation in the Innovation Fund workshops, or notification to CPA staff of their program interest.
• Four (4) additional agencies have enrolled in the Pathways to Electrification program this quarter, for a total of fifteen (15) agencies to date. Eleven (11) additional agencies are currently reviewing the Pathways to Electrification participation agreements.
• The first Energized Communities project – the renovated Clark Building in Hermosa Beach – was completed.
Community Electric Vehicle (EV) Charging Pathway:
Agenda Page 187
Board of Directors Item 9
• In April 2025, CPA launched the Community EV Charging pathway to offer funds to support public EV charging projects to member agencies that do not need CPA’s technical assistance to move forward. The technical assistance portion of the program was launched in August after the Board’s approval of a Professional Services Agreement with CPA’s vendor ICF. Two member agencies are currently enrolled.
Innovation Fund:
• Round 1: At its March 6th meeting, the Board of Directors selected five (5) member agency projects for funding: City of Carson, City of Culver City, City of Oxnard, City of Santa Monica, and City of West Hollywood. Most of the agencies have executed their participation agreements, and initial project work is taking place.
• Round 2: The second funding opportunity opened on August 25th and closes on October 8, 2025. Member agencies are eligible to apply for up to $250,000 to support decarbonization projects in their communities. Agencies that were selected for funding in Round 1, and did not apply for the full $250,000, are eligible to apply for the remainder of that budget in Round 2. A review team comprised of CPA’s Community Advisory Committee members and CPA staff will review the project submissions and prepare recommendations.
Challenges and Risks
The member agencies internal process to select a Pathways to Electrification program and approve the corresponding Participation Agreement remains lengthy, leading to later than desired start dates for some projects. Similar delays in approving the Innovation Fund agreements may result in additional time being incorporated into the individual project timelines.
Several member agencies are experiencing staff capacity and budget issues and have deferred the start of their Pathways to Electrification projects. Some of the Electric Fleet, Community EV Charging, and Innovation Fund projects will likely require energy infrastructure upgrades and coordination with Southern
Agenda Page 188
Board of Directors Item 9
California Edison (SCE). SCE has a lengthy project implementation queue, which could add to the timeline of CPA-funded projects.
Reduced funding and removal of federal tax credits are impacting future rounds of grant funding and other incentives that would typically support building electrification, electric fleet, and public EV charging projects.
Goals for the Next Quarter
CPA continues to engage with member agencies who have not selected an Energized Communities pathway.
Staff plans to prepare the recommendations for projects for Round 2 of the Innovation Fund for Board consideration.
Agenda Page 189
Board of Directors Item 9
Key: Black X = Selected
Black check marks = complete
Grey check marks = incomplete
CPA Innovation Fund Program Status: (as of August 19, 2025) Agency & Project Title
Executed
Participation
Agreement
Project Started Project
Completed
Carson EV Charging Wallet Pilot Program ✓ ✓ ✓
Culver City Portable Battery Fleet Program to
Replace Gas Generators ✓ ✓ ✓
Oxnard Lamppost Electric Vehicle Charging Pilot
Project ✓ ✓ ✓
Santa Monica Renters’ Energy and
Cooling/Heating (REACH) Program ✓ ✓ ✓
West Hollywood Equitable Building Performance
Standards and Benchmarking Support ✓ ✓ ✓
Agenda Page 190
Board of Directors Item 9
Key: Black X = Selected
Black check marks = complete
Grey check marks = incomplete
CPA Energized Communities Project Status Summary (page 1): (as of August 19, 2025) Pathway Selection Milestones
Member Agency Fleet
Electrification
Building
Electrification
Community
EV Charging
Agency
Briefing
Project
Scope
Selected
Executed
Participation
Agreement
Project
Started
Project
Completed
Agoura Hills x ✓ ✓ ✓ ✓ ✓
Alhambra x ✓ ✓ ✓ ✓ ✓
Arcadia x ✓ ✓ ✓ ✓ ✓
Beverly Hills x ✓ ✓ ✓ ✓ ✓
Calabasas x ✓ ✓ ✓ ✓ ✓
Camarillo x ✓ ✓ ✓ ✓ ✓
Carson x ✓ ✓ ✓ ✓ ✓
Claremont x ✓ ✓ ✓ ✓ ✓
Culver City x ✓ ✓ ✓ ✓ ✓
Downey x ✓ ✓ ✓ ✓ ✓
Hawaiian Gardens x ✓ ✓ ✓ ✓ ✓
Hawthorne x ✓ ✓ ✓ ✓ ✓
Hermosa Beach x ✓ ✓ ✓ ✓ ✓
La Cañada Flintridge x x x ✓ ✓ ✓ ✓ ✓
Los Angeles Co. x ✓ ✓ ✓ ✓ ✓
Agenda Page 191
Board of Directors Item 9
Key: Black X = Selected
Black check marks = complete
Grey check marks = incomplete
CPA Energized Communities Project Status Summary (page 2): (as of August 19, 2025) Pathway Selection Milestones
Member Agency Fleet
Electrification
Building
Electrification
Public EV
Charging
Agency
Briefing
Project
Scope
Selected
Executed
Participation
Agreement
Project
Started
Project
Completed
Lynwood x x x ✓ ✓ ✓ ✓ ✓
Malibu x x x ✓ ✓ ✓ ✓ ✓
Manhattan Beach x ✓ ✓ ✓ ✓ ✓
Monrovia x ✓ ✓ ✓ ✓ ✓
Moorpark x x x ✓ ✓ ✓ ✓ ✓
Ojai x ✓ ✓ ✓ ✓ ✓
Oxnard x ✓ ✓ ✓ ✓ ✓
Paramount x ✓ ✓ ✓ ✓ ✓
Port Hueneme x ✓ ✓ ✓ ✓ ✓
Redondo Beach x ✓ ✓ ✓ ✓ ✓
Rolling Hills Estates x x x ✓ ✓ ✓ ✓ ✓
Santa Monica x ✓ ✓ ✓ ✓ ✓
Santa Paula x ✓ ✓ ✓ ✓ ✓
Sierra Madre x ✓ ✓ ✓ ✓ ✓
Simi Valley x x x ✓ ✓ ✓ ✓ ✓
South Pasadena x ✓ ✓ ✓ ✓ ✓
Agenda Page 192
Board of Directors Item 9
Key: Black X = Selected
Black check marks = complete
Grey check marks = incomplete
CPA Energized Communities Project Status Summary (page 3): (as of August 19, 2025) Pathway Selection Milestones
Member Agency Fleet
Electrification
Building
Electrification
Public EV
Charging
Agency
Briefing
Project Scope
Selected
Executed
Participation
Agreement
Project
Started
Project
Completed
Temple City x ✓ ✓ ✓ ✓ ✓
Thousand Oaks x ✓ ✓ ✓ ✓ ✓
Ventura x ✓ ✓ ✓ ✓ ✓
Ventura County x ✓ ✓ ✓ ✓ ✓
West Hollywood x ✓ ✓ ✓ ✓ ✓
Westlake Village x x x ✓ ✓ ✓ ✓ ✓
Whittier x ✓ ✓ ✓ ✓ ✓
Agenda Page 193
Staff Report – Agenda Item 10
To: Board of Directors
From: Gina Goodhill, Senior Director, Government Affairs Approved By: Ted Bardacke, Chief Executive Officer
Subject: Receive and File September 2025 Bill Positions Report Date: September 4, 2025
RECOMMENDATION
Receive and file.
ATTACHMENT
1. 2025 Legislative and Regulatory Policy Platform
Agenda Page 194
Board of Directors Item 10
Bill Number &
Author
Title & Summary Status CPA Position Alignment with
CPA Policy
Platform
Notes
AB 729
Assemblymember Rick
Zbur
Public Utilities, Climate
Credits: Would move the
California Climate Credit on
customer bills from April and
October to August and
September.
6/05/25
Referred to
Senate
Committee on
Energy, Utilities
and
Communications
Sponsor 5a August and
September are the
two months (along
with July) in which
CPA customers
typically have their
highest electricity
bills. This bill is likely
to be absorbed by AB
745 (Irwin).
SB 330
Senator Steve Padilla
Electrical transmission
infrastructure: financing
Would identify transmission
infrastructure pilot projects
that state or local public
agencies could develop,
finance, or operate.
7/16/25
Bill no longer
moving
Support 1e This bill explores a
public-private
partnership model to
develop
transmission, which
could bring down the
cost of transmission
for ratepayers by
leveraging the
municipal tax status
afforded to public
agencies.
Agenda Page 195
Board of Directors Item 10
SB 540
Senator Josh Becker
Independent System
Operator: independent
regional organization
Pathways bill to establish a
regional energy cooperative
(“regionalization”) to optimize
California’s energy markets,
increase grid reliability,
reduce costs to ratepayers,
and accelerate the transition
to clean energy.
7/16/25
Set for first
hearing and
canceled at the
request of the
author.
While CPA’s
last official
position was
Oppose Unless
Amended, CPA
has moved
back to a
Support
Position and is
sharing this
position with its
delegation.
2g This is the
“regionalization” bill
that CPA has been
tracking since the
Pathways
conversation began
several years ago
and which the Board
took a support
position on the
concept in December
2023. This bill is no
longer moving
through committee
process, and the
details will be fleshed
out by the Assembly,
Senate, and
Governor’s office.
SB 239
Senator Jesse Arreguin
Open meetings:
teleconferencing:
subsidiary body. Would
allow subsidiary bodies of a
local agency to hold
teleconference meetings
without having to notice and
Inactive Support 5c This bill would allow
our Community
Advisory Committee
to meet remotely,
thus increasing
opportunities for the
participation of
volunteers.
Agenda Page 196
Board of Directors Item 10
make publicly available each
teleconference location
AB 740
Assemblymember John
Harabedian
Virtual power plants: load
shifting Would require the
CPUC to create a strategy
and perform a study to better
understand the impact of
virtual power plants (VPP) on
the grid.
8/29/25
Passed out of
Senate
Appropriations
Committee with
amendments.
Support 2a, 2d Virtual power plants
consist of a network
of decentralized,
medium scale power
generating units and
flexible loads such as
batteries, EVs, smart
appliances, and
flexible heating and
cooling loads.
AB 306
Assemblymember Nick
Schultz
Building regulations: state
building standards
Would prohibit a city or
county from making changes
to the building code until
June 1, 2031, with limited
exceptions.
6/25/25
AB 306 language
was inserted into
SB 130, the
Housing Budget
Bill. As such, AB
306 is unlikely to
move in its
current form.
Instead, it will be
signed into law as
part of the state
budget.
Oppose Unless
Amended
3a, 3b This will impact
CPA’s Reach Code
Program and the
work of many of our
member agencies to
advance building
decarbonization
through reach codes.
Despite a strong
coalition effort,
language has been
approved that would
apply to both new
and existing
construction and will
Agenda Page 197
Board of Directors Item 10
go into effect
beginning Oct 1,
2025.
AB 1260
Assemblymember
Christopher Ward
Renewable energy
subscription programs
Would re-open the
community solar proceeding
at the CPUC to modify the
calculations in avoided costs,
among other things.
5/23/25
Bill no longer
moving
Watch 3c This could have an
impact on CPA’s
Power Share
program.
AB 303
Assemblymember Dawn
Addis
Battery Storage Facilities
Imposes requirements to site
battery storage facilities,
uses the same sensitive
receptors, land use
restrictions, and set back
requirements as new oil well
requirements.
Bill no longer
moving
Watch 2a
SB 283
Senator John Laird
Energy storage systems.
Establishes the Clean
Energy Safety Act of 2025
and requires energy storage
systems authorized by the
CEC or a local government
8/20/25
Passed out of
Assembly
Appropriations
Committee
Support 2a This bill is a response
to growing public
concern over fires in
large battery energy
storage systems
(BESS). CPA
supports the
Agenda Page 198
Board of Directors Item 10
to comply with new fire safety
standards.
maintenance and
operation standards
proposed in this bill.
SB 256
Senator Sasha Renee
Perez
Electricity: electrical
infrastructure. Would
require electrical utilities to
prioritize undergrounding of
power lines, strengthen
public safety power shut off
standards and accountability,
requires union labor for the
undergrounding. Would also
grant CPUC the ability to
immediately access all
relevant fault data related to
natural disasters.
8/29/25
Held in Assembly
Appropriations
Committee – bill
no longer moving
Watch 2e, 3b, 3c
AB 1117
Assemblymember Nick
Schultz
Electricity: rates: optional
dynamic rate tariffs
Would require the CPUC to
develop optional dynamic
rate tariffs and would give
ratepayers the options to
elect a dynamic rate tariff
8/29/25
Held in Senate
Appropriations
Committee – bill
no longer moving
Watch 1a
SB 541
Assemblymember Josh
Becker
Electricity: load shifting:
dynamic pricing
8/29/25
Passed out of
Assembly
Watch 1a, 1d As currently written,
this bill could infringe
on CCA autonomy
Agenda Page 199
Board of Directors Item 10
Would require the CEC to
allocate load shifting goals to
load serving entities (LSE),
would require LSE’s to meet
load-shifting goals and to
offer dynamic pricing tariffs.
Appropriations
Committee with
amendments
and create
duplicative
requirements in
relation to recent
CEC and CPUC
rulemakings on
dynamic pricing.
AB 825
Assemblymember Cottie
Petrie-Norris
Public Transmission
Financing Act of 2025
Would create a Public
Transmission Program that
would utilize $325 million of
Proposition 4 funds to fund
efforts to lower the cost of
transmission projects
8/29/25
Passed out of
Senate
Appropriations
Committee
Watch 1e, 2d The Assembly’s bill
to tackle energy
affordability, wildfire
costs, and rates
transparency, with a
specific focus on
public transmission
financing.
SB 254
Senator Josh Becker
Electricity: wildfire
mitigation: rate assistance:
Policy-oriented and wildfire
electric reimbursement
(POWER) Program
Would create a statewide
authority to develop
transmission and other
infrastructure; would
overhaul the framework for
oversight of wildfire
mitigation; increases the
8/29/25
Passed out of
Assembly
Appropriations
Committee
Watch 1e, 2d, 4b, 5a The Senate’s bill to
tackle energy
affordability, wildfires
costs, and rates
transparency.
Agenda Page 200
Board of Directors Item 10
climate credit for
CARE/FERA customers;
increases the burden of proof
for IOUs to raise rates, and
more.
AB 942
Assemblymember Lisa
Calderon
Net energy metering:
eligible customer-generators: tariffs
Would require new property
owners inheriting solar
systems to take service
under the current, not
inherited NEM tariff, and
would disqualify a customer-generator from receiving the Climate Credit.
8/29/25
Passed out of
Senate
Appropriations
Committee
Watch 3a, 5c This bill was recently
amended to remove
the proposed sunset
to legacy NEM
contracts after 10
years
AB 1408
Assemblymember Jacqui
Irwin
Electricity:
interconnections
Would require electric utilities
and the CAISO to consider
“surplus interconnection” as
part of various transmission
and distribution planning.
8/28/25
In Senate
Appropriations
Committee,
ordered to third
reading
Watch 1e, 2d Surplus
Interconnection
Service is potentially
a medium-term
solution to reducing
delays in the
interconnection
process by allowing
clean energy projects
to connect to the grid
Agenda Page 201
Board of Directors Item 10
through the unused
portion of an existing
generator’s point of
interconnection.
AB 745
Assemblymember Jacqui
Irwin
Electricity: climate credits
Would move the California
Climate Credit on customer
bills from April and October
to July, August and
September. It would also
calculate credit on a
volumetric basis, rather than
a fixed amount.
8/29/25
Passed out of
Senate
Appropriations
Committee
Watch 5a Along with AB 729,
SB 254, and AB 942,
this is one of several
bills that makes
changes to the
California Climate
Credit. The language
in AB 745 mirrors the
recently released
language in the
Assembly’s draft
language to re-authorize the Cap-and-Trade Program
(now renamed the
Cap-and-Invest
Program).
Agenda Page 202
Final 2025 Legislative and Regulatory Policy Platform
Overview and Purpose
The Clean Power Alliance (CPA) Legislative and Regulatory Policy Platform (Platform) serves as a guide to the CPA Board of Directors and CPA staff in their advocacy efforts and engagement on policy matters of interest to CPA. The Platform allows both members of the CPA Board of Directors and CPA staff to pursue actions at the regional, state and federal legislative and regulatory levels in a consistent manner and with the understanding that they are pursuing actions in the best interest of the organization and its mission, its member agencies, and its customers.
The Platform provides direction to CPA staff on positions that should be taken on regulatory matters and legislative bill proposals. The Platform also provides guidance to the Chief Executive Officer on positions that should be taken on legislative and regulatory matters that come before the California Community Choice Association (CalCCA) Board of Directors.
CPA staff report to the Board monthly on all positions taken on legislative bills. For bills that fall outside the scope of this platform; bills that are likely to attract high-profile supporters and detractors, including bills that would modify the California Environmental Quality Act (CEQA); bills that would raise taxes; or bills that would knowingly put CPA at odds with positions that its member agencies have taken, CPA staff will seek approval of a proposed position to the Legislative & Regulatory Committee and Board of Directors before taking a position.
Policy Principles
The Legislative and Regulatory Policy Platform is centered around five basic principles:
1. Protecting CPA’s local control and competitive position, especially as it relates to rates, finances, power procurement and expansion of its service territory.
2. Pursing power resource planning and procurement that promotes the growth in renewable energy capacity at the local, state, and regional level and reduces fossil fuel dependency, with the goal of combating climate change.
Agenda Page 203
3. Developing and administering customer programs that encourage clean energy adoption by CPA customers and the use of that clean energy in an efficient and managed way to support cost reduction and grid reliability.
4. Ensuring fair access to data, particularly as it relates to energy usage, billing, and information needed to develop and administer customer programs.
5. Supporting CPA’s ability to set electric rates and offer programmatic services that are affordable and inclusive for all.
These principles are incorporated throughout the below platform.
Policy Platform
1. Affordability and Local Control
a. Fair rates and cost allocation: CPA will pursue administrative and legislative initiatives that will ensure that non-bypassable charges for CPA customers, including any income-graduated fixed charges, are assessed fairly compared to bundled customers and that CPA’s customers are not unnecessarily burdened by non-bypassable charges.
b. Finances: CPA will pursue administrative and legislative initiatives to ensure that CPA is eligible to apply and receive funding made available to the electricity sector for decarbonization, reliability, and affordability purposes, and that CPA’s financial health is not disparately impacted by new regulations. c. CCA Expansion: CPA will pursue administrative and legislative initiatives to protect CPA’s ability to expand its service to new member agencies. d. Local Control: CPA will pursue administrative and legislative initiatives to protect CPA Board’s authority over CPA’s procurement, rate-setting, governance, and customer program development activities.
e. Infrastructure Financing: CPA will pursue administrative and legislative initiatives that support alternative approaches to financing energy infrastructure that reduce costs for all customers.
2. Power Resources Planning and Procurement
Agenda Page 204
a. Resource Adequacy and Reliability: CPA will pursue administrative and legislative initiatives that will enable CPA to secure capacity resources to meet its reliability obligations, such as initiatives that evaluate the supply of capacity resources available to load serving entities (LSEs), determine the appropriate market mechanisms for LSEs to procure capacity resources, and develop a durable policy framework that encourages all LSEs to construct their fair share of new capacity resources to maintain grid reliability while pursuing decarbonization efforts.
b. Renewable and Carbon-Free Resources: CPA will pursue administrative and legislative initiatives that will maximize CPA’s ability to procure eligible Renewable Portfolio Standard (RPS) and carbon-free resources to meet the needs of CPA’s three product offerings and its long-term RPS procurement goal as required by SB 100 and other statutory or regulatory obligations. c. Integrated Resource Plan: CPA will pursue administrative and legislative initiatives that will maximize CPA’s ability to plan and procure resources to meet various environmental and reliability goals set by state laws and by its Board of Directors, while offering affordable products and programs to serve its customers, including disadvantaged communities.
d. Transmission: CPA will pursue administrative and legislative initiatives that will expedite new transmission infrastructure needed to meet California’s climate goals, as well as initiatives that will provide CPA adequate access to transmission capacity to maximize its procurement of RPS-eligible or carbon-free resources that meet various statutory and regulatory requirements. e. Access to the Electrical Grid: CPA will pursue administrative and legislative initiatives that support reducing timelines in interconnection and service extensions for new construction, critical services, renewable energy, building decarbonization, and other projects in CPA’s service territory. f. Research & Development: CPA will pursue administrative and legislative initiatives that support the research and development of new energy resources that can be procured to meet the reliability and decarbonization goals set by the State and its Board of Directors.
g. Grid Reliability: CPA will pursue administrative and legislative initiatives that support the expansion of a regional Western energy grid that improves reliability; accelerates decarbonization; improves transmission planning; reduces costs for ratepayer and load serving entities; maintains California’s ability to set, meet
Agenda Page 205
and implement its own climate goals; and protects clean energy jobs within the State.
3. Customer Programs
a. Demand Response, Demand Flexibility and Energy Efficiency: CPA will pursue administrative and legislative initiatives that will enable CPA and its customers to develop and participate in programs that promote the use of clean energy in an efficient and managed way to support cost reduction, grid reliability, and lower greenhouse gas emissions.
b. Building and vehicle decarbonization: CPA will pursue administrative and legislative initiatives that support the ability of CPA to promote statewide building and vehicle decarbonization, primarily through electrification. c. Local Grid Management and Resiliency: CPA will pursue administrative and legislative initiatives that supports the ability of CPA and its member agencies to offer local grid management and resiliency solutions to increase local reliability, and adaptability that could protect against power outages and extreme heat. d. Research and Development: CPA will pursue administrative and legislative initiatives that support the ability of CPA to explore new opportunities related to behind the meter clean energy resources.
4. Data Access
a. Timely and Accurate Access to Customer Data: CPA will pursue administrative and legislative initiatives that will enable CPA to obtain timely and accurate access to its customers’ data to improve billing accuracy and inform the development and implementation of customer programs.
a. Fair Fees for Data Management Services: CPA will pursue administrative and legislative initiatives to ensure that the fees due to Southern California Edison for data access and management are fairly assessed based on data needs and potential technological improvements.
b. Billing Transparency: CPA will pursue administrative and legislative initiatives that increase customer understanding of electricity bill components and display
Agenda Page 206
electricity charges in a clear and consistent manner for both bundled and unbundled customers.
5. Diversity, Equity, Inclusion
a. Customer Protection: CPA will pursue administrative and legislative initiatives that support the protection of all ratepayers, particularly environmental and social justice communities in CPA’s service territory.
b. Supplier Diversity: CPA will pursue administrative and legislative initiatives that supports supplier diversity in CPA’s contracting activities and through women-owned, minority-owned, disabled-veteran-owned, and lesbian, gay, bisexual, and/or
c. Energy Equity: CPA will pursue administrative and legislative initiatives that support increased access to clean energy technologies, workforce development initiatives that support the clean energy industry, and clean energy opportunities for environmental and social justice communities in CPA’s service territory.
Agenda Page 207
Staff Report – Agenda Item 11
To: Board of Directors
From: Christian Cruz, Senior Community Outreach Manager Approved by: Ted Bardacke, Chief Executive Officer
Subject: Community Advisory Committee (CAC) Report
Date: September 4, 2025
RECOMMENDATION
Receive and file.
MEETING REPORT
CAC Annual Retreat
As outlined in Section 2 of the CAC Workplan, CAC members participated in the annual CAC retreat on July 25th to establish annual goals and priorities. The retreat was broken into two key sessions. The first “Wildfire Risk and Intersection with Clean Energy and Resiliency” focused on the evolving landscape of wildfire resiliency in Southern California and featured a panel of experts:
• Alex Hall, Director of UCLA’s Center for Climate Science • Dave Sapsis, Senior Fire Scientist at CalFire
• Joanne O’Neill, Director of Customer Programs at Clean Power Alliance This session looked at the impacts from the tragic January fires and emphasized recent updates to CalFire’s fire zone designations and their implications for local preparedness strategies. Mr. Sapsis presented the new Southern California fire risk mapping and methodologies, highlighting how these changes have reshaped community understanding of vulnerability and emergency planning. Mr. Hall provided a regional climate perspective, linking shifting wildfire patterns, and Santa Ana winds. Ms. O’Neill examined the role that Clean Power Alliance could play in advancing local resiliency through grid-hardening, energy storage, and distributed generation.
Agenda Page 208
Board of Directors Item 11
Expert insights and CAC input helped guide a comprehensive discussion on building community-led resilience. This discussion also featured a breakout session that allowed CAC members to provide feedback on the following questions:
1. How can CPA and the CAC effectively communicate wildfire risk and promote resilience strategies to customers in high-risk areas of Ventura and Los Angeles Counties?
2. What role specifically should CAC members play in promoting preparedness (e.g., microgrids, battery storage)?
3. Are there new programs or program expansions CPA should consider in order to help vulnerable communities?
Key takeaways from the breakout session included:
• Community concerns about fire and battery safety need proactive, transparent messaging: Residents are worried about property value loss due to fire risk disclosures and battery system safety, especially following incidents like the Moss Landing fires. CPA should focus on clear, trust-building education about fire hardening benefits and advancements in battery safety, potentially using guidance from battery advocacy groups.
• Youth-focused messaging can drive broader community awareness: Engaging students through initiatives like a messaging challenge can empower them to educate their families, making fire safety and clean energy information more accessible and impactful across generations.
• Fire-impacted communities need differentiated, tailored resilience strategies: CPA should recognize and respond to the distinct needs of those rebuilding from total home loss versus those with partial damage, ensuring support is grounded in community-specific realities and long-term recovery goals. • CPA must actively listen to inform energy-focused rebuilding support: By deeply understanding community concerns, CPA can offer relevant guidance that align with residents' recovery and resilience priorities. These could include hazard mitigation strategies, backup power solutions, and emergency preparedness tools. • Proactive, transparent communication builds trust: Residents are highly concerned about fire and battery safety, property value impacts, and disaster preparedness.
Agenda Page 209
Board of Directors Item 11
CPA should prioritize clear, trusted messaging on fire hardening, battery safety, and resilience programs to address these concerns.
• Tailored, community-specific resilience strategies are essential: Different communities face different recovery needs (e.g., total vs. partial home loss). CPA’s programs and outreach should reflect these unique circumstances to provide meaningful, actionable support.
The second session, “CPA Outreach: Connecting with Communities”, was led by CPA Director of Communications and Marketing, Cara Rene, and focused on how CPA should design its upcoming Mobile Education Center (MEC) to deliver inclusive, engaging, hands-on education to CPA customers. The session also featured a breakout session where Committee members provided feedback on how to ensure the experience would be culturally relevant, language-accessible, and tailored to meet residents where they are in their understanding of clean energy solutions. During the breakout committee members considered the following:
1. Audience: Who is the audience for the MEC? What should we consider when designing an inclusive experience for our diverse customer base?
2. Experience: What unique experiences/learning opportunities should this provide outside of regular tabling activities? What are the core messages and interactions that the audience should have?
3. Customer takeaways: What should customers know when they leave? What impressions should they have?
Key takeaways from the breakout session included:
• The MEC should personalize outreach and clearly identify CPA customers: Since many event attendees may not be CPA customers, the experience must quickly determine who is eligible and tailor engagement accordingly to maximize impact. • The experience should drive real-time program connection and interest: The unit should inspire curiosity about clean energy and allow residents to immediately discover which CPA programs they qualify for, enabling timely follow-up by CPA program managers.
Agenda Page 210
Board of Directors Item 11
ATTACHMENT
1. CAC Meeting Attendance
Community Advisory Committee Attendance
2025
Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov
East Ventura/West LA County
Angus Simmons ✓ ✓ ✓ ✓ ✓ A
Kat Selm ✓ ✓ ✓ A ✓ ✓
Debbie West A A A A A ✓
San Gabriel Valley
Casey Law A ✓ ✓ A A
Leslie Diaz-Villavicencio
West/Unincorporated Ventura County
Kent Bullard A ✓ ✓ ✓ ✓ A
Daniel Mora ✓ A ✓ ✓ ✓ ✓
South Bay
Cort Casady ✓ ✓ ✓ ✓ ✓ ✓
Diane Wallace ✓ ✓ ✓ ✓ ✓ ✓
Gateway Cities
Luis Alvarez ✓
Genaro Bugarin ✓ ✓ ✓ ✓ ✓ ✓
Westside
Cris Gutierrez ✓ A ✓ ✓ ✓ ✓
David Haake A ✓ ✓ A A ✓
Unincorporated LA County
Neil Fromer ✓ ✓ ✓ ✓ ✓ ✓
Margaret Fuentes
✓ - Attended A – Absent X – Medical/Personal Leave Gray=Vacant Seat or Cancelled Meeting Action Items and Presentations
January
Low Income Solar and Storage Program
July
CAC Retreat - Wildfire Risk
CAC Retreat - Mobil Education Unit
February
Legislative Update and 2025 Policy Platform
CPA Programs General Update
August
Dark
March
CPA Programs Fire Response Programs
September
April
FY 2025/2026 Rate Options
October
May
Officer Appointments
CPA Draft Budget
November
June
Cancelled
December
Agenda Page 211
Staff Report – Agenda Item 12
To: Board of Directors
From: Lindsay Saxby, Vice President, Power Supply
John McNamara, Director, Structured Contracts
Reviewed By: Matthew Langer, Chief Operating Officer
Approved By: Ted Bardacke, Chief Executive Officer
Subject: Incremental SunZia Renewable Power Purchase Agreements Date: September 4, 2025
RECOMMENDATION
Approve and authorize the Chief Executive Officer to execute two 15-Year Renewable Power Purchase Agreements with SunZia Wind North LLC for 37.3 MW and with SunZia Wind South LLC for 87.7 MW for a combined total of 125 MW of incremental capacity.
BACKGROUND
CPA and SunZia are parties to a 15-year, 575 MW Power Purchase Agreement (“PPA”) that was approved by the Board on November 2, 2023. The SunZia project is developed by Pattern Energy (Pattern) and will be the largest renewable energy project in the United States. The project includes the construction of a new dedicated transmission line from the project site in central New Mexico to deliver electricity to California. The project broke ground in December of 2023. It is now in the late stages of construction. The Guaranteed Commercial Operation date is October 31, 2026, but the project could come online as early as Q2 2026.
Agenda Page 212
Board of Directors Item 12
In March 2025, Pattern presented CPA with a bilateral proposal for 125 MW of incremental capacity at SunZia. Given the value to CPA’s portfolio, the scarcity of viable wind projects, the uncertainty surrounding current tax and tariff policy and the mature status of this project, staff determined that the proposal warranted consideration outside of the standard RFO cycle. On June 12, 2025, a Review Team consisting of four Board members from the Energy Committee as well as senior staff consisting of the Chief Executive Officer, Chief Operating Officer, and Vice President, Power Supply met to analyze the proposal. The Review Team members evaluated confidential terms and conditions, including pricing, and recommended to the Energy Committee entering into negotiations for the PPA. On June 25, 2025, the Energy Committee approved the recommendation, authorizing staff to proceed with PPA negotiations.
Per CPA’s Energy Risk Management Policy, any new build power purchase transactions with greater than a 5-year term or 7-year maturity limit are required to be approved by the Board.
CPA retained Todd Larsen with Clean Energy Counsel to represent CPA and its interests in the negotiation of this agreement. Mr. Larsen’s work was overseen by CPA’s General Counsel.
PROJECT OVERVIEW
The SunZia Wind project is a 3,650 MW new-build wind facility expected to come online in 2026. The project is located in Lincoln, Torrance, and San Miguel Counties in central New Mexico. The project will deliver energy to the California Independent System Operator (CAISO) grid at Palo Verde via an approximately 550-mile-long transmission line dedicated to the project. The existing and incremental contracts will account for a share of all the energy that flows through Palo Verde, proportional to the contracted MW share of the project.
With several new large solar projects having come online in 2024 and 2025 and the expected commencement of energy deliveries from the original SunZia contract and the Agenda Page 213
Board of Directors Item 12
Solar Star 3 and 4 projects in 2026, CPA is well positioned to meet customer demand for renewable energy through 2028. Thus to optimize the additional 125 MW volume within CPA’s portfolio, the incremental contract has CPA paying only for and receiving Resource Adequacy (RA) from the Commercial Operation Date (COD) through January 1, 2029.
Starting January 1, 2029, CPA will receive all attributes (energy, Renewable Energy Credits and RA) for the remainder of the 15-year contract term at a fixed-price rate with no escalation.
Renewable energy projects often go through ownership structure changes during pre-development, construction, and operation, usually in response to financing needs; all of CPA’s contracts have provisions allowing for ownership changes to go forward via administrative consent. Pattern requested that the incremental 125 MW SunZia PPA be bifurcated into two separate PPAs (SunZia North at 37.3 MW and SunZia South at 87.7 MW) to aid in the financing of the project. The bifurcation will allow the owner of the northern portion to be different than the owner of the southern portion and is the reason for two PPA’s being submitted for approval. There is no material impact to CPA as a result of the bifurcation.
With the additional 125 MWs, CPA would have a total of 700 MW of contract capacity at the SunZia facilities which would mean Pattern would remain CPA’s third largest counterparty by capacity, representing approximately 15% of CPA’s long-term portfolio.
Given the advanced development stage of this project, risk of further delays or default is minimal and therefore the additional portfolio concentration risk is minimal.
Developer
Pattern is an independent developer with renewable energy facilities in the United States, Canada, Japan, and Mexico. Pattern has developed an operating portfolio of 35 renewable power facilities with a total operating nameplate capacity of approximately six gigawatts. Pattern has also already successfully developed, financed, and constructed approximately 1,600 MW of New Mexico wind combined with transmission for delivery to Agenda Page 214
Board of Directors Item 12
California, known as the Western Spirit project. Buyers of energy from that project include several CCAs and the Los Angeles Department of Water and Power.
Evaluation Criteria
CPA ranks projects for economic value based on the net present value (NPV) and on a High, Medium, Neutral, and Low scale in five other qualitative evaluation criteria categories (development score, workforce development, environmental stewardship, benefits to disadvantaged communities, and project location). Below is the ranking assigned to this project in each of those categories.
Value
Wind energy is a critical component of CPA’s current and future portfolio diversity. It is complementary to the generating profile of solar, providing renewable energy in the evening and at night.
SunZia’s 125 MW proposal is priced lower than the two wind proposals submitted in the 2025 Clean Energy and Reliability RFO. The project falls within the second quartile (Q2) of proposal submissions ranked by Net Present Value (NPV) in the 2025 RFO, has a positive NPV, and the highest NPV of all the wind projects in the RFO. This incremental 125MW of capacity is priced higher than CPA’s original PPA for SunZia but given that the project is further along in its development, the project is substantially de-risked and therefore a premium would be expected. The PPAs for the incremental 125 MW do not impact the pricing of the original 575 MW SunZia PPA.
Development Score
The project ranks High as it is in the final stage of development. SunZia is a mature project with full site control, established transmission, interconnection and deliverability and near certainty that the project will achieve commercial operation. The advanced stage of construction means that it is unlikely to be impacted by changing policies including land use, tax credits and tariffs.
Agenda Page 215
Board of Directors Item 12
Workforce Development
The project ranks High on workforce development as SunZia has been paying prevailing wages, utilizing a significant amount of union labor, and is supported by the International Brotherhood of Electrical Workers (IBEW). In addition, Pattern has been supporting the local community in New Mexico via multiple community benefit agreements, a number of which focus on job training. As of the most recent construction report, the cumulative hours worked on the project total more than 4 million. There are currently 1,624 personnel on site. It is estimated that there will be 100 local permanent jobs to perform maintenance and operations.
Environmental Stewardship
The project ranks Neutral on environmental stewardship as the project is not located within an ecological avoidance area but some of the land is located on undisturbed habitat. The project developer has worked with conservation groups to avoid, minimize, or mitigate project impacts on wildlife and habitat, and the project has the support of the National Audubon Society. It is located in one of the prime areas Western United States identified by The Nature Conservancy as a place where environmentally low-conflict renewable energy supply could be sourced to meet California’s clean energy goals.
Benefits to Disadvantaged Communities
The project ranks Neutral on benefits to Disadvantaged Communities (DACs) as it is out-of-state and not located within a DAC.
Project Location
The project ranks Medium on location as it is located outside of California, but the majority of the project is in Lincoln County, a federally designated “Energy Community”, with large amounts of fossil fuel related employment and an above average unemployment rate in 2024. The project also has the support of local business groups in Southern California, including the Los Angeles Business Council.
Agenda Page 216
Board of Directors Item 12
RATIONALE
The incremental volume from the SunZia project will make a valuable contribution towards growing CPA’s renewable energy supply sourced from long-term contracts. The project will also add resource diversity to CPA’s portfolio from a resource that is difficult to acquire in California and will contribute to CPA’s Resource Adequacy portfolio by providing both energy and RA in hours of the day that are complementary to a typical solar plus storage profile.
The rationale for moving forward includes the following:
• Wind is a scarce resource that is critical for portfolio diversity for which CPA does not anticipate receiving many proposals in the coming years. • SunZia’s proposal is priced lower than any other recent wind opportunity received, is NPV positive, and ranks in the second quartile of proposals in the 2025 Clean Energy and Reliability RFO.
• This project is not expected to be impacted by recent changes to tax credits contained in the 2025 H.R. 1 tax and spending bill.
• The RA from SunZia has a relatively flat profile under the “slice of day” RA framework, which requires CPA to show RA capacity in every hour of the day rather than solely the peak hour. Incremental SunZia RA capacity would offset RA purchases from natural gas resources and can be used in "non-solar" hours for RA compliance.
• SunZia is a mature project with established transmission, interconnection and deliverability and near certainty that project will achieve commercial operation. • The project has no tariff risk and carries very low tax credit risk since it is already under construction.
ENVIRONMENTAL REVIEW
The SunZia Wind project is subject to the siting jurisdiction of the New Mexico Public Regulation Commission (NM PRC) and environmental impact reports were required to be prepared as part of the applications for location control approval. These environmental impact reports are complete and certified by NM PRC.
Agenda Page 217
Board of Directors Item 12
CPA has no role, jurisdiction, or authority whatsoever with respect to NM PRC review or project approval.
ATTACHMENTS1
1. Presentation on SunZia Wind PPAs
2. Renewable Power Purchase Agreement SunZia Wind North
3. Renewable Power Purchase Agreement SunZia Wind South 1 Consistent with industry practice, portions of the agreements have been redacted to protect market sensitive information.
Agenda Page 218
SunZia Wind
Power Purchase Agreements for an
Incremental 125 MW
September 4, 2025
Agenda Page 219
On November 2, 2023 CPA’s Board approved a Power Purchase Agreement (PPA) for a 575 MW share of the 3,650 MW SunZia Wind facility located in New Mexico.
In March, 2025 CPA received a bilateral proposal for an incremental 125 MW portion of the SunZia project. On June 25, 2025, the Energy Committee authorized staff to proceed with PPA negotiations.
The 125 MW portion of the SunZia project is split into two separate PPA’s as the entire project was split between North and South facilities to aid in project financing. The proposed SunZia North PPA is 37.3 MW and the SunZia South PPA is 87.7 MW.
Wind projects are scarce and projects in earlier stages of development are facing an uncertain future due to changes in tax credit, tariff, and other federal policies. However, SunZia is in an advanced stage of construction and is unlikely to be impacted by these changing policies.
Wind energy is a critical component of CPA’s current and future portfolio diversity.
Staff has concluded negotiations and is requesting the Board approve and authorize the Chief Executive Officer to execute the two SunZia PPAs.
2 Executive Summary
Agenda Page 220
SunZia Wind Project Overview
SunZia Wind is located in Lincoln, Torrance and San Miguel Counties in central New Mexico. A new transmission line (SunZia Transmission) will bring the power to both Arizona and to the California Independent System Operator (CAISO) Energy will be delivered into the California Independent System Operator (CAISO) at the Palo Verde intertie, at which point the project has a 2,131 MW firm transmission limit The project also will provide Resource Adequacy (RA) with a “flat profile”, which has significant value under the current Slice of Day framework The original PPA included a provision to split (Bifurcate) the project to facilitate financing. The 125 MW incremental portion is bifurcated into two respective PPAs (North and South). The bifurcation has no material impact to CPA CPA will receive its proportional share (Buyer’s Share) of all energy that flows to CAISO from the North and South facilities
The developer, Pattern Energy, has an operating portfolio of 35 renewable power facilities and has placed approximately 6 GW of wind generation into service in its history, including the new Western Spirit project which supplies LADWP and other public power and CCA entities in California
Agenda Page 221
3 SunZia: Bilateral Proposal for Incremental Capacity
Project Overview:
Size: 125 MW incremental capacity split between the North and South projects Products: RA and renewable energy
Developer: Pattern Energy
Term: 15 Years
Location: New Mexico
Commercial Operation Date (COD) and Products Offered:
Initial Period: RA-only starting 10/31/2026 (same as contractual guaranteed COD for the existing 575 MW PPA)
Remainder of Delivery Term: All attributes (energy, RECs and RA starting 1/1/2029) This contract structure best aligns with CPA's need for additional renewable energy which begins in 2029/2030
Price:
The incremental SunZia offer is priced higher than the existing PPA due to shifts in the market and a lower risk profile compared to when the original contract was executed in 2023 The incremental price compares favorably to recent wind offers The incremental capacity does not impact the original contract price, which stays the same Rationale
Wind delivery profile, renewable energy value, RA value, project certainty 4 Criteria Rank
Value 2nd Quartile
(Positive NPV)*
Development Score High
Workforce
Development High
Environmental
Stewardship Neutral
Benefits to DACs Neutral
Project Location Medium
Evaluation Summary:
*Relative to 2025 Clean Energy and Reliability RFO Valuation Results Agenda Page 222
Opportunities for Wind
5 Opportunities to procure wind resources remain scarce No wind projects were offered in the 2024 Clean Energy and Reliability RFO CPA received 2 offers for wind in the 2025 Clean Energy RFO however they were higher priced than SunZia and only one of the proposals provides RA
Issues with other out of state wind resources
Idaho: Lava Ridge wind project has been cancelled by Executive Order Wyoming: Multiple wind projects have been delayed due to federal permitting and local opposition Agenda Page 223
Wind and CPA’s Energy Portfolio
Wind energy is important to CPA’s portfolio
because it is complementary to the generating
profile of solar, providing renewable energy in
the evening and at night.
SunZia has a generation profile that is flatter
throughout the day compared to in-state wind.
Baseload renewable technologies like
geothermal and biomass can also fill the need
for energy in the evening and at night, but
availability is limited and cost is high.
Energy storage also plays a role by shifting solar
energy from the middle of the day to the
evening hours, but storage generally runs out
after 4 hours (i.e. around 11pm).
Due to the overall scarcity of wind
projects, higher development costs, and
the added value of their delivery profile, wind
energy contracts typically result in higher prices
relative to solar projects but can compare
favorably on an NPV basis.
6 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 MWh
SunZia Average Hourly Profile
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 MWh
Example Hourly Load versus Hourly Generation By
Resource Type
Wind PV CPA Load
Agenda Page 224
Considerations
The rationale for moving forward includes the following:
Wind is a scarce resource that is critical for portfolio diversity for which CPA does not anticipate receiving many offers in the coming years
The project is in the second quartile compared to the 2025 RFO, positive NPV, and priced lower than any other recent wind opportunity received
The RA from SunZia has a flat, baseload-like profile under the “slice of day” framework. Incremental SunZia RA capacity would offset RA purchases from natural gas resources and can be used in "non-solar" hours for RA compliance
SunZia is a mature project with established transmission, interconnection and deliverability and near certainty that project will achieve commercial operation
The project has no tariff risk and carries very low tax credit risk since it is already under construction The project will allow CPA to make meaningful progress towards meeting its long-term RA and renewable energy needs
Counting the 125 MW incremental capacity, SunZia would remain CPA's 3rd largest counterparty by capacity, representing ~15% of CPA's long-term portfolio. However, the near-term COD reduces development risk SunZia would contribute to procurement targets in the 2025 Clean Energy and Reliability RFO but CPA would still have an open position to fill for both renewable energy and RA in the 2025 RFO, where projects are slated to come online in the 2029 – 2032 timeframe.
Agenda Page 225
7 Action Requested
CPA is seeking Board approval for the SunZia Wind North and South Power Purchase Agreements (PPAs) which would add an incremental 125 MW to CPA’s existing contract for 575 MW
Action Requested: Approve and Authorize the CEO to execute the 15-year Renewable Power Purchase Agreements with SunZia Wind North LLC and SunZia Wind South LLC for a total of 125 MW
Project Technology Contract
Capacity
Guaranteed
Commercial
Operation Date
Contract
Length Process
SunZia Wind
North Wind 37.3 MW 10/31/2026 15 Years Bilateral Offer
SunZia Wind
South Wind 87.7 MW 10/31/2026 15 Years Bilateral Offer
Agenda Page 226
8 SUNZIA (NORTH) PPA
RENEWABLE ENERGY
EXECUTION VERSION
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RENEWABLE POWER PURCHASE AGREEMENT (SUNZIA NORTH)
COVER SHEET
Seller: SunZia Wind North LLC, a Delaware limited liability company Buyer: Clean Power Alliance of Southern California, a California joint powers authority Description of Facility: The wind-powered electricity generating facility known as SunZia Wind North, with a nameplate capacity of up to 1,089 MW located in San Miguel County, New Mexico, as described in Exhibit A, as such facility may be modified under the terms of this Agreement Milestones:
Milestone Expected Date for
Completion
Executed Interconnection Agreement Completed
Bureau of Land Management Record of Decision for
SunZia Transmission Line Completed
Site Control Completed
Financial Close Completed
Construction Start Date Completed
Expected Initial Synchronization 2/28/2026
Expected Commercial Operation Date 4/30/2026
Expected Date of CAISO Commercial Operation 4/30/2026
Guaranteed Commercial Operation Date 10/31/2026
Delivery Term: Fifteen (15) Contract Years
Delivery Term Expected Energy: 119,173 MWh per Contract Year, commencing on the Initial Energy Delivery Date, as such amount may be adjusted by Seller in accordance with the definition of “Expected Energy” below
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Guaranteed Capacity: 37.3 MW of total Facility capacity Contract Rate:
Contract Year Contract Rate ($/MWh)
1 – 15
Prior to the Initial Energy Delivery
Date:$ /kW-mo (flat) with no
escalation
From and after the Initial Energy
Delivery Date: $ /MWh (flat)
with no escalation
Product
☒ Facility Energy (from and after the Initial Energy Delivery Date) ☒ Green Attributes (from and after the Initial Energy Delivery Date):
☒ Portfolio Content Category 1
☐ Portfolio Content Category 2
☐ Portfolio Content Category 3
☒ Capacity Attributes (from and after the RA Guarantee Date) Scheduling Coordinator: Seller
Security Amounts:
Development Security: $ /kW of Guaranteed Capacity
Performance Security: $ /kW of Guaranteed Capacity
Agenda Page 228
TABLE OF CONTENTS
Page
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ARTICLE 1 DEFINITIONS ..............................................................................................1
1.1 Contract Definitions .....................................................................................1
1.2 Rules of Interpretation ...............................................................................27 ARTICLE 2 TERM; CONDITIONS PRECEDENT........................................................28
2.1 Contract Term. ...........................................................................................28
2.2 Conditions Precedent to Delivery ..............................................................28
2.3 Development; Construction; Progress Reports ..........................................30
2.4 Remedial Action Plan ................................................................................30 ARTICLE 3 PURCHASE AND SALE ............................................................................31
3.1 Purchase and Sale of Product .....................................................................31
3.2 Sale of Green Attributes. ............................................................................31
3.3 Imbalance Energy. .....................................................................................31
3.4 Ownership of Renewable Energy Incentives. ............................................31
3.5 Future Environmental Attributes. ..............................................................32
3.6 [Reserved]. .................................................................................................32
3.7 Capacity Attributes. ...................................................................................32
3.8 Resource Adequacy Failure .......................................................................34
3.9 CEC Certification and Verification. ..........................................................34
3.10 Eligibility. ..................................................................................................35
3.11 California Renewables Portfolio Standard. ................................................35
3.12 Compliance Expenditure Cap. ...................................................................35
3.13 Project Configuration .................................................................................36 ARTICLE 4 OBLIGATIONS AND DELIVERIES .........................................................36
4.1 Delivery......................................................................................................36
4.2 Title and Risk of Loss. ...............................................................................37
4.3 Forecasting .................................................................................................37
4.4 Dispatch Down/Curtailment. .....................................................................39
4.5 Station Use .................................................................................................39
4.6 Facility Maintenance ..................................................................................40
4.7 Guaranteed Energy Production. .................................................................41
4.8 WREGIS ....................................................................................................42 ARTICLE 5 TAXES ........................................................................................................44
5.1 Allocation of Taxes and Charges. ..............................................................44
5.2 Cooperation. ...............................................................................................44 ARTICLE 6 MAINTENANCE OF THE FACILITY ......................................................45
6.1 Maintenance of the Facility. ......................................................................45
6.2 Maintenance of Health and Safety. ............................................................45
6.3 Shared Facilities .........................................................................................45 ARTICLE 7 METERING .................................................................................................47
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7.1 Metering. ....................................................................................................47
7.2 Meter Verification. .....................................................................................47 ARTICLE 8 INVOICING AND PAYMENT; CREDIT ..................................................48
8.1 Invoicing. ...................................................................................................48
8.2 Payment......................................................................................................48
8.3 Books and Records. ...................................................................................48
8.4 Payment Adjustments; Billing Errors. .......................................................48
8.5 Billing Disputes. ........................................................................................49
8.6 Netting of Payments. ..................................................................................49
8.7 Seller’s Development Security. .................................................................49
8.8 Seller’s Performance Security. ...................................................................50
8.9 First Priority Security Interest in Cash or Cash Equivalent Collateral ......50
8.10 Financial Statements. .................................................................................51 ARTICLE 9 NOTICES ....................................................................................................51
9.1 Addresses for the Delivery of Notices .......................................................51
9.2 Acceptable Means of Delivering Notice ....................................................51 ARTICLE 10 FORCE MAJEURE ...................................................................................52
10.1 Definition ...................................................................................................52
10.2 No Liability If a Force Majeure Event Occurs ..........................................53
10.3 Notice .........................................................................................................53
10.4 Termination Following Force Majeure Event or Development Cure Period53 ARTICLE 11 DEFAULTS; REMEDIES; TERMINATION ...........................................54
11.1 Events of Default .......................................................................................54
11.2 Remedies; Declaration of Early Termination Date. ...................................57
11.3 Damage Payment; Termination Payment ..................................................57
11.4 Notice of Payment of Termination Payment or Damage Payment ............59
11.5 Disputes With Respect to Termination Payment or Damage Payment .....59
11.6 Limitation on Seller’s Ability to Make or Agree to Third-Party Sales from the Facility after Early Termination Date ..................................................59
11.7 Rights And Remedies Are Cumulative ......................................................60
11.8 Mitigation ...................................................................................................60 ARTICLE 12 LIMITATION OF LIABILITY AND EXCLUSION OF WARRANTIES60
12.1 No Consequential Damages. ......................................................................60
12.2 Waiver and Exclusion of Other Damages. .................................................60 ARTICLE 13 REPRESENTATIONS AND WARRANTIES; AUTHORITY ................62
13.1 Seller’s Representations and Warranties. ..................................................62
13.2 Buyer’s Representations and Warranties ...................................................62
13.3 General Covenants. ....................................................................................63
13.4 Prevailing Wage .........................................................................................64
13.5 [Reserved] ..................................................................................................64
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13.6 Supplier Diversity Reporting .....................................................................64 ARTICLE 14 ASSIGNMENT..........................................................................................65
14.1 General Prohibition on Assignments. ........................................................65
14.2 Collateral Assignment ................................................................................65
14.3 Permitted Assignment by Seller .................................................................65
14.4 Shared Facilities; Portfolio Financing .......................................................66
14.5 Buyer Financing Assignment. ....................................................................66 ARTICLE 15 DISPUTE RESOLUTION .........................................................................67
15.1 Governing Law. .........................................................................................67
15.2 Dispute Resolution. ....................................................................................67
15.3 Attorneys’ Fees. .........................................................................................67
15.4 Venue .........................................................................................................67 ARTICLE 16 INDEMNIFICATION ...............................................................................67
16.1 Indemnification. .........................................................................................67
16.2 Claims. .......................................................................................................68 ARTICLE 17 INSURANCE ............................................................................................69
17.1 Insurance ....................................................................................................69 ARTICLE 18 CONFIDENTIAL INFORMATION .........................................................70
18.1 Definition of Confidential Information ......................................................70
18.2 Duty to Maintain Confidentiality ...............................................................70
18.3 Irreparable Injury; Remedies .....................................................................71
18.4 Further Permitted Disclosure .....................................................................71
18.5 Press Releases ............................................................................................72 ARTICLE 19 MISCELLANEOUS ..................................................................................72
19.1 Entire Agreement; Integration; Exhibits ....................................................72
19.2 Amendments ..............................................................................................72
19.3 No Waiver ..................................................................................................72
19.4 No Agency, Partnership, Joint Venture or Lease .......................................72
19.5 Severability ................................................................................................72
19.6 Mobile-Sierra .............................................................................................73
19.7 Counterparts ...............................................................................................73
19.8 Electronic Delivery ....................................................................................73
19.9 Binding Effect ............................................................................................73
19.10 No Recourse to Members of Buyer ...........................................................73
19.11 Forward Contract .......................................................................................73
19.12 Change in Electric Market Design .............................................................73
19.13 Further Assurances.....................................................................................74
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Exhibits:
Exhibit A Facility Description
Exhibit B Facility Construction and Commercial Operation Exhibit C Compensation
Exhibit D Scheduling Coordinator Responsibilities
Exhibit E Progress Reporting Form
Exhibit F-1 Form of Monthly Expected Available Facility Capacity Report Exhibit F-2 Form of Monthly Expected Facility Energy 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 [Reserved]
Exhibit K Form of Letter of Credit
Exhibit L Form of Limited Assignment Agreement
Exhibit M Form of Guaranty
Exhibit N Notices
Exhibit O Sample Calculation of Guaranteed RA Amount
Exhibit P CPM Adjustment Factors
Exhibit Q Supply Chain Code of Conduct
Exhibit R Metering Diagram
Exhibit S Material Permits
Exhibit T Force Majeure Event and/or Development Cure Period Claim Form Exhibit U Operating Restrictions
Agenda Page 232
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RENEWABLE POWER PURCHASE AGREEMENT (SUNZIA NORTH)
This Renewable Power Purchase Agreement (SunZia North) (“Agreement”) is entered into as of ______________ (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, construct, own, and operate the Facility known as SunZia Wind North, with a nameplate capacity of up to 1,089 MW, located in San Miguel County, New Mexico;
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 as follows:
ARTICLE 1
DEFINITIONS
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(c). “Adjusted Energy Production” has the meaning set forth in Exhibit G. “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. “Agreement” has the meaning set forth in the Preamble and includes the Cover Sheet and any Exhibits, schedules and any written supplements hereto. “Alternate Facility” means that certain wind generating facility described in Exhibit A.
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“Alternative Delivery Point” means a Scheduling Point other than the Delivery Point that is agreed upon by Buyer and Seller.
“Approved Forecast Vendor” means (a) or (b) any other reputable third-party vendor that is registered to do business in California, experienced in providing and verifying wind energy generation forecasts, and not an Affiliate of Seller. “Assignment Agreement” has the meaning set forth in Section 14.5(a). “Available Capacity” means Buyer’s Share of the Installed Capacity, expressed in whole MW, that is available to generate Energy.
“Balancing Authority” has the meaning set forth in the CAISO Tariff. “Balancing Authority Area” has the meaning set forth in the CAISO Tariff. “Bankrupt” or “Bankruptcy” 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” has the meaning set forth on the Cover Sheet.
“Buyer Assignee” has the meaning set forth in Section 14.5(a). “Buyer Default” means an Event of Default of Buyer.
“Buyer’s Indemnified Parties” has the meaning set forth in Section 18.2. “Buyer’s Share” means the percentage equal to the result of dividing the Guaranteed Capacity by the Installed Capacity, as such percentage may change from time to time with changes to the Installed Capacity; provided, in no event shall the Buyer’s Share exceed 100% (whether before or after establishment of the final Installed Capacity). “Buyer’s WREGIS Account” has the meaning set forth in Section 4.8(a). “CAISO” means the California Independent System Operator Corporation or any successor entity performing similar functions.
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“CAISO Certification” means the certification and testing requirements for a generating unit set forth in the CAISO Tariff that are applicable to the Facility, including certification and testing for PMAX and PMIN (as each term is defined in the CAISO Tariff) associated with such generating units, that are applicable to the Facility.
“CAISO Commercial Operation” means that the CAISO has provided notification that the Energy generation from a portion of the Facility that is no smaller than the Guaranteed Installed Capacity may be scheduled into the CAISO markets on an unconditional basis in accordance with the CAISO Tariff and Business Practice Manual(s) as applicable, including the New Resource Implementation process.
“CAISO Grid” has the same meaning as “CAISO Controlled Grid” as defined in 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.
“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 Buyer’s Share of 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, sold or conveyed under CAISO or CPUC market rules, including Resource Adequacy Benefits. “CEC” means the California Energy Commission or its successor agency. “CEC Certification and Verification” means that the CEC has certified that the Facility is an Eligible Renewable Energy Resource for purposes of the California Renewables Portfolio Standard and that all Facility Energy qualifies as generation from an Eligible Renewable Energy Resource.
“Change of Control” means any circumstance in which Ultimate Parent ceases to own, directly or indirectly through one or more intermediate entities, at least fifty percent (50%) of the outstanding equity interests in Seller; provided, 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 at least fifty percent (50%) of the outstanding equity interests in each such intermediate entity; and
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(b) ownership interests in Seller owned directly or indirectly by any Lender (including any tax equity provider) shall be excluded from the total outstanding equity interests in Seller. “CIRA Tool” means the CAISO Customer Interface for Resource Adequacy, or any successor mechanism.
“COD Certificate” has the meaning set forth in Exhibit B. “COD Delay Damages Payment” has the meaning set forth in Exhibit B. “Commercial Operation” has the meaning set forth in Exhibit B. “Commercial Operation Date” means the date Commercial Operation is achieved. “Commercial Operation Delay Damages” means an amount equal to (a) the Development Security amount required hereunder, divided by (b) “Compliance Actions” has the meaning set forth in Section 3.12(a). “Compliance Expenditure Cap” has the meaning set forth in Section 3.12. “Confidential Information” has the meaning set forth in Section 18.1. “Contract Rate” has the meaning set forth on the Cover Sheet. “Contract Revenues” has the meaning set forth in Section 4.4(b). “Contract Term” has the meaning set forth in Section 2.1(a). “Contract Year” means a period of twelve (12) consecutive months. The first Contract Year shall commence on the Commercial Operation Date and each subsequent Contract Year shall commence on the anniversary of the Commercial Operation Date. “Costs” means, with respect to the Non-Defaulting Party, brokerage fees, commissions and other similar third-party transaction costs and expenses reasonably incurred by such Party either in terminating any arrangement pursuant to which it has hedged its obligations or entering into new arrangements which replace the Agreement; and all reasonable attorneys’ fees and expenses incurred by the Non-Defaulting Party in connection with terminating the Agreement. “Cover Sheet” means the cover sheet to this Agreement, which is incorporated into this Agreement.
“COVID-19” means the pandemic disease designated COVID-19 and the related virus designated SARS-CoV-2 and any mutations thereof, and the efforts of a Governmental Authority to combat such disease.
“CPM Adjustment Factor” means, for any RA Shortfall Month, the percentage for the corresponding calendar month set forth in Exhibit P.
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“CPM Price” has the meaning set forth in Section 3.8(b). “CPM Soft Offer Cap” has the meaning set forth in the CAISO Tariff. “CPUC” means the California Public Utilities Commission, or successor entity. “Credit Rating” means, with respect to any entity, the rating then assigned to such entity’s unsecured, senior long-term debt obligations (not supported by third party credit enhancements) or if such entity does not have a rating for its senior unsecured long-term debt, then the rating then assigned to such entity as an issuer rating by S&P or Moody’s. If ratings by S&P and Moody’s are not equivalent, the lower rating shall apply.
“Cure Plan” has the meaning set forth in Section 11.1(b)(iii). “Curtailment Order” means any of the following:
(a) CAISO orders, directs, alerts, or provides notice to a Party, including an Operating Instruction (as defined in the CAISO Tariff), to curtail deliveries of Facility Energy for the following reasons: (i) any System Emergency, (ii) any warning of an anticipated System Emergency, or warning of an imminent condition or situation, which jeopardizes CAISO’s electric system integrity or the integrity of other systems to which CAISO is connected, or (iii) in response to an Energy oversupply or potential Energy oversupply, and Seller or the SC for the Facility submitted a Self-Schedule for the MWhs curtailed during the relevant time period; (b) a curtailment ordered by a Transmission Provider for reasons including, but not limited to, (i) any situation that affects normal function of the electric system including, but not limited to, any abnormal condition that requires action to prevent circumstances such as equipment damage, loss of load, or abnormal voltage conditions, including a System Emergency, or (ii) any warning, forecast or anticipation of conditions or situations that jeopardize a Transmission Provider’s electric system integrity or the integrity of other systems to which a Transmission Provider is connected, including a System Emergency;
(c) a curtailment ordered by CAISO or a Transmission Provider due to a Transmission System Outage; or
(d) a curtailment in accordance with Seller’s obligations under its Interconnection Agreement with the PTO.
“Curtailment Period” means the period of time, as measured using current Settlement Intervals, during which Seller reduces generation or deliveries of Facility Energy from the Facility pursuant to a Curtailment Order; provided, the Curtailment Period shall be inclusive of the time required for the Facility to ramp down and ramp up.
“Damage Payment” means the amount to be paid by the Defaulting Party to the Non-Defaulting Party after a Terminated Transaction occurring prior to the Commercial Operation Date, in a dollar amount as set forth in Section 11.3(a).
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“Day-Ahead Forecast” means the amount of Energy expected to be generated by the Facility and delivered to Buyer at the Delivery Point, net of all Electrical Losses and subject to the Hourly Delivery Cap, for each hour of the immediately succeeding day in accordance with Seller’s obligations under this Agreement, based on a forecast from the Approved Forecast Vendor using a forecasting methodology to determine the potential generation of the Facility as a function of Available Capacity, wind speed and direction, wind turbine power curves and other pertinent data (including data related to Curtailment Orders), for the period of time, consistent with Prudent Operating Practice; provided, a Day-Ahead Forecast provided in a day prior to any non-Business Day(s) shall include non-binding forecasts for the immediately succeeding day, each succeeding non-Business Day and the next Business Day.
“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 difference of (i) the Market Curtailment Max Energy, minus (ii) the amount of Facility Energy delivered to the Delivery Point during the Market Curtailment Period; provided, if the applicable difference is negative, the Deemed Delivered Energy shall be zero (0) MWh.
“Deemed Delivered RA” means, for any month, the amount of Resource Adequacy Benefits expressed in kW that Seller would have delivered to Buyer, but for Buyer’s actions or inactions (including, until such time as the Facility receives a Deliverability Allocation from the CAISO, failure to obtain Import Capability sufficient to allow for the importation of such capacity into the CAISO). As of the Effective Date, the Parties agree that the Deemed Delivered RA shall be determined by calculating the quotient of (i) the sum of the following: for each hour of the twenty-four hour array applicable to such Showing Month, the amount of Resource Adequacy Benefits (in MW) that Seller would have delivered to Buyer, but for Buyer’s actions or inactions (including, until such time as the Facility receives a Deliverability Allocation from the CAISO, failure to obtain Import Capability sufficient to allow for the importation of such capacity into the CAISO, unless Buyer is prohibited by the CAISO Tariff from using Import Capability with respect to the Resource Adequacy Benefits and such prohibition is not due to the fault or negligence of Buyer and Buyer has used commercially reasonable efforts to avoid or mitigate such prohibition), divided by (ii) twenty four (24). If (i) Seller submits a Supply Plan to the CAISO in accordance with the requirements of this Agreement by the applicable Showing Deadline and is otherwise in compliance with Section 3.7, but (ii) the CIRA Tool shows that Seller’s Supply Plan has not been accepted by the CAISO through no fault of Seller, and (iii) Seller uses commercially reasonable efforts to resolve any failure by the CAISO to approve such Supply Plan, then the Resource Adequacy Benefits included in such Supply Plan shall be considered Deemed Delivered RA; provided, if Buyer’s inability to utilize any Resource Adequacy Benefits is the result of the CAISO Tariff disallowing Buyer from using Import Capability to obtain some or all of the Capacity Attributes from the Facility and such prohibition is not due to the fault or negligence of Buyer and Buyer has used commercially reasonable efforts to avoid or mitigate such prohibition, it shall not be considered Deemed Delivered RA.
“Defaulting Party” has the meaning set forth in Section 11.1(a).
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“Deficient Month” has the meaning set forth in Section 4.8(e). “Deliverability Allocation” means an allocation of Deliverability (as defined in the CAISO Tariff) to the Facility such that Buyer may receive all of the Resource Adequacy Benefits at the Delivery Point throughout the Delivery Term without any need to obtain an allocation of Maximum Import Capability or other import rights.
“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” means, at Seller’s option, (a) cash or (b) one or more Letters of Credit, in aggregate in the amount specified for the Development Security on the Cover Sheet. “Disclosing Party” has the meaning set forth in Section18.2. “E-Tag” has the meaning set forth in the CAISO Tariff.
“Early Termination Date” has the meaning set forth in Section 11.2(a). “Effective Date” has the meaning set forth in the Preamble hereto. “Electrical Losses” means all transmission or transformation losses between the Facility’s Point of Interconnection to the PTO’s Transmission System and the Delivery Point, expressed in MWh; provided, Electrical Losses shall not include losses that are replaced with Energy provided by one or more Transmission Providers and paid for by Seller (at Seller’s sole expense) and that, when delivered to Buyer hereunder, meet the requirements for Product delivered hereunder, including PCC1 status.
“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, measured in kilowatt-hours, megawatt-hours, or multiple units thereof.
“Energy Replacement Damages” has the meaning set forth in Section 4.7(a). “EPC Contract” means Seller’s engineering, procurement and construction contract(s) for the Facility.
“Event of Default” has the meaning set forth in Section 11.1.
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“Exceedance Profile RA Amount” means, as of the Effective Date, for a given Showing Month, the quotient of (i) the sum of the following: for each hour of the twenty-four hour array applicable to such Showing Month, the maximum amount of Resource Adequacy Benefits (in MW) that Buyer is able to receive in the relevant RA Compliance Template, based on the shape factor set forth for the applicable hour of the applicable Showing Month under tab “Resource Default Profiles” for New Mexico Wind, Cells E338-E625, on the CPUC website at https://www.cpuc.ca.gov/-/media/cpuc-website/divisions/energy-division/documents/resource-adequacy-homepage/resource-adequacy-compliance-materials/guides-and-resources/rashowingtemplate_rev35.xlsm (as such may be updated or replaced by the CPUC from time to time) and assuming that Buyer’s RA Plan in respect of the Facility matches the Supply Plan submitted by Seller for the Facility (provided Seller’s Supply Plan does not reflect an amount in excess of the Guaranteed RA Amount), divided by (ii) twenty four (24). “Excess MWh” has the meaning set forth in Exhibit C.
“Excused Capacity Reduction” means a reduction to the Capacity Attributes available from the Facility due to (a) System Emergency , (b) Curtailment Order (c) Force
Majeure Event, (d) Major Planned Outage, (e) Qualified Forced Facility Outage, or (f) Planned Outage; provided:
(x)
;
(y)
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(z)
f
an Excused Capacity Reduction (as
described below). In the case of a Qualified Forced Facility Outage that occurs and as to which Notice was provided to Buyer thirty (30) days or more before the RA Plan Showing Deadline for the applicable Showing Month, Seller may elect to treat such Qualified Forced Facility Outage as a Planned Outage or Major Planned Outage for purposes of determining the treatment of such Qualified Forced Facility Outage as an Excused Capacity Reduction by including such election in its original Notice to Buyer of such Qualified Forced Facility Outage, and may change such election via a subsequent Notice to Buyer on or before the date that is thirty (30) days prior to an applicable Showing Deadline and no more often than once per Showing Month. “Expected Commercial Operation Date” has the meaning set forth on the Cover Sheet. “Expected Energy” means the quantity of Facility Energy (with associated Green Attributes) that Seller expects to be able to deliver to Buyer from the Facility during each Contract Year, from and after the Initial Energy Delivery Date, which for each Contract Year is the quantity specified on the Cover Sheet and which shall be adjusted on a pro rata basis as appropriate for the Contract Year during which the Initial Energy Delivery Date occurs based on the number of days in such Contract Year; provided, (i) such amount shall be increased or decreased by Seller in a Notice to Buyer within sixty (60) days following the delivery by Seller of the final Installed Capacity Certificate in the form attached hereto as Exhibit I, and (ii) the amount of Expected Energy stated in such notice shall equal Buyer’s Share of the P50 amount set forth in the most wind resource assessment from a Licensed Professional Engineer (adjusted as necessary to reflect the Hourly Delivery Cap), but in no event shall the adjusted annual Expected Energy amount be more than higher or lower than the annual Expected Energy amount as set forth on the Cover Sheet; provided further, Seller shall use commercially reasonable efforts to notify Buyer of any change in the anticipated Expected Energy from the quantity specified on the Cover Sheet prior to the Commercial Operation Date.
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“Expected Installed Capacity” the amount of Seller’s anticipated Installed Capacity, which as of the Effective Date equals 1,089 MW, and which may be reduced upon Notice to Buyer from time to time.
“Facility” means the wind-powered electricity generating facility described on the Cover Sheet and in Exhibit A, installed at the Site pursuant to the terms of the EPC Contracts, and including mechanical equipment and associated facilities and equipment required to deliver Facility Energy to the Delivery Point; provided, the “Facility” does not include any Shared Facilities.
“Facility Energy” means, in any Settlement Interval or Settlement Period, as applicable, the amount of Energy generated by the Facility and delivered to Buyer at the Delivery Point in accordance with Seller’s obligations under this Agreement, which such amount shall equal: (i) (a) Buyer’s Share of the Energy produced by the Facility and delivered to the Point of Interconnection, as measured in MWh by the Facility Meter, as such amount may be reduced as a result of a Curtailment Order, net of all Electrical Losses (without duplication of losses programmed into the Facility Meter, if any) and Station Use, or (b) if the Facility output is reduced, at Seller’s direction (and not, for example, as a result of a Forced Facility Outage) in any Settlement Interval or Settlement Period, as applicable, that is not during a Curtailment Period or Market Curtailment Period, then Facility Energy for such Settlement Interval or Settlement Period, as applicable, will instead be equal to Buyer’s Share of the Energy that the Facility would have been able to produce and deliver to the Point of Interconnection, if the Facility output was not so reduced, or (c) if the Facility output is reduced, at Seller’s direction in any Settlement Interval or Settlement Period, as applicable, during a Market Curtailment Period, then Facility Energy for such Settlement Interval or Settlement Period, as applicable, will instead be equal to the Market Curtailment Max Energy, minus any of such Market Curtailment Max Energy that is actually curtailed in connection with such Market Curtailment Period, which amount of curtailed Energy shall be calculated by Seller in a manner consistent with Prudent Industry Practices and, upon request from Buyer, demonstrated to Buyer’s reasonable satisfaction; and, in each case of (a), (b) and (c), subject to the Hourly Delivery Cap multiplied by the duration of the Settlement Interval or Settlement Period, as applicable, (as measured in hours); plus (ii) all Replacement Energy delivered as part of prospectively delivered Replacement Product pursuant to Section 4.7(b). “Facility Meter” means one or more CAISO-approved revenue quality meters located inside the Facility’s Point of Interconnection switching station, together with a 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 Energy produced by the Facility net of Electrical Losses and Station Use. “FERC” means the Federal Energy Regulatory Commission or any successor government agency.
“Fifteen Minute Market” or “FMM” has the meaning set forth in the CAISO Tariff.
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“Financial Close” means Seller and/or one or more of its Affiliates has obtained debt and/or equity financing commitments from one or more Lenders sufficient to construct the Facility, including such financing commitments from Seller’s owner(s). “Fitch” means Fitch Ratings, Inc., or its successor.
“Floor Price” means (a) for the period during which Seller is eligible to obtain PTCs and for that portion of the Facility Energy or Deemed Delivered Energy, as the case may be, to which PTC eligibility applies, the amount, on a dollar per MWh basis, equal to the Negative PTC Amount, or (b) for all other periods and portions of Facility Energy or Deemed Delivered Energy, zero dollars per MWh ($0/MWh), subject to clause (b)(ii) of Exhibit D. The Floor Price will be a single value. Subject to clause (b)(ii) of Exhibit D, the Floor Price shall be calculated as the average of the amounts determined pursuant to clauses (a) and (b) of this definition of “Floor Price”, such average to be weighted based on the percentages of the Installed Capacity to which such amounts apply.
“Force Majeure Event” has the meaning set forth in Section 10.1. “Forced Facility Outage” means (i) an unexpected failure of one or more components of the Facility (including subsequent outages to remediate such unexpected failure), or (ii) the unexpected removal from service of one or more components of the Facility, which removal from service is required to prevent or limit imminent harm to or loss of life or property, or prevent imminent loss of or damage to the Facility or the Transmission System, in each case that prevents Seller from generating Energy and/or making Energy from the Facility available at the Delivery Point, and that is not the result of a Force Majeure Event. “Forecasted Product” has the meaning set forth in Section 4.3(b). “Future Environmental Attributes” means any and all Green Attributes that become recognized under applicable Law after the Effective Date (and not before the Effective Date), notwithstanding the last sentence of the definition of “Green Attributes” herein. Future Environmental Attributes do not include 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 includes the value of Green Attributes and Capacity Attributes.
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“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, or entity with authority to bind a Party at law, including CAISO, WREGIS, and the CPUC; provided, “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 (including under the RPS regulations and/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)), 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; and (3) the reporting rights to such avoided emissions, such as Green Tag Reporting Rights. Green Attributes do not include (i) any energy, capacity, reliability or other power attributes from the Facility, (ii) Tax Credits associated with the construction or operation of the Facility and other financial incentives in the form of credits, reductions, or allowances associated therewith, or (iii) emission reduction credits encumbered or used by the Facility for compliance with local, state, or federal operating and/or air quality permits. Green Attributes under the preceding definition are limited to Green Attributes that exist under applicable Law as of the Effective Date.
“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. “Green Tags” means a unit accumulated on a MWh basis where one (1) represents the Green Attributes associated with one (1) MWh of Facility Energy. “Green-e Certified” means the Green Attributes provided to Buyer pursuant to this Agreement are certified under the Green-e Energy National Standard. “Green-e Energy National Standard” means the Green-e Renewable Energy Standard for Canada and the United States (formerly Green-e Energy National Standard) version 4.2, updated April 27, 2023, as may be further amended from time to time.
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“Guaranteed Capacity” means the portion of the generating capacity of the Facility, as measured in MW, that Seller commits to install pursuant to this Agreement, as set forth on the Cover Sheet.
“Guaranteed Commercial Operation Date” has the meaning set forth on the Cover Sheet, subject to extension pursuant to Exhibit B.
“Guaranteed Energy Production” has the meaning set forth in Section 4.7(a). “Guaranteed Installed Capacity” means, as of any date, the total installed generating nameplate capacity of the Facility, as measured in MW, with respect to which Seller has commenced and is obligated to continue deliveries of Energy (not including test energy) and associated Green Attributes and/or resource adequacy benefits produced by or associated with such generating nameplate capacity to purchasers under power purchase agreements or similar long-term offtake agreements with third parties; provided that (a) in determining whether each of CAISO Commercial Operation and Commercial Operation has occurred and (b) on and after the Commercial Operation Date, the Guaranteed Installed Capacity shall include the Guaranteed Capacity.
“Guaranteed RA Amount” means a guaranteed amount of Resource Adequacy Benefits for a given Showing Month, equal to the difference between (i) the maximum amount of Resource Adequacy Benefits (in MW) that could be provided by the Facility under then-current Law, and (ii) Excused Capacity Reductions.
For the purposes of the definition of “Guaranteed RA Amount”, the amount described in clause (i) above shall not be deemed reduced based on the calculation or determination, by the CAISO or the CPUC, of the Resource Adequacy Benefits (in MW) available from the Facility resulting from any performance of the Facility or any actions or inactions of Seller impacting the performance of the Facility, including due to Planned Outages, Major Planned Outages or Forced Facility Outages, as reasonably demonstrated by documentation prepared by the CAISO or the CPUC (but not including any cause external to the Facility, for example, a lack of wind resource, any outage of the Transmission System, or a Curtailment Order not caused by Seller), regardless of whether such outages result in Excused Capacity Reductions).
Subject to the foregoing, as of the Effective Date, the Parties agree that the Guaranteed RA Amount shall be the quotient of (a) the sum of the following: for each hour of the twenty-four hour array applicable to such Showing Month, the product of (w) the PMAX (as defined in the CAISO Tariff) of the Facility minus the capacity of the Facility (in MW) that is not available for purposes of compliance with the Resource Adequacy Requirements as a result of Excused Capacity Reductions, multiplied by (y) Buyer’s Share, multiplied by (z)
on the CPUC website at https://www.cpuc.ca.gov/-/media/cpuc-website/divisions/energy-division/documents/resource-adequacy-homepage/resource-adequacy-compliance-materials/guides-and-resources/rashowingtemplate rev35.xlsm (as such may be updated or replaced by the CPUC from time to time), An
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illustrative-only example of the calculation of the Guaranteed RA Amount as of the Effective Date is set forth in Exhibit O.
“Guarantor” means any Person that (a) is an Affiliate of Seller, or other third party reasonably acceptable to Buyer, (b) has a Credit Rating of BBB- or better from S&P or a Credit Rating of Baa3 or better from Moody’s, (c) is incorporated or organized in a jurisdiction of the United States and is in good standing in such jurisdiction, and (d) 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 M, or as reasonably acceptable to Buyer. “Hourly Delivery Cap” means the maximum delivery rate of Energy and associated Renewable Energy Credits and Green Tags delivered to the Delivery Point and sold to Buyer in any given hour under this Agreement, which amount shall be equal to Buyer’s Share multiplied by 636 MW.
“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.
“Import Capability” means that portion of the Maximum Import Capability allocated by the CAISO that is necessary to support the importation of Resource Adequacy Benefits from the Facility into the CAISO market in an amount equal to the Guaranteed RA Amount. “Indemnified Party” has the meaning set forth in Section 16.1. “Indemnifying Party” has the meaning set forth in Section 16.1. “Initial Energy Delivery Date” means the first date upon which Seller delivers Facility Energy and associated Green Attributes to Buyer, which shall occur on January 1, 2029. “Initial Synchronization” means the commencement of Trial Operations (as defined in the CAISO Tariff).
“Installed Capacity” means the nameplate capacity of the Facility at the Point of Interconnection, as evidenced by a certificate from a Licensed Professional Engineer substantially in the form attached as Exhibit I hereto, as it may be updated from time to time by delivery of a subsequent certificate from a Licensed Professional Engineer substantially in the form attached as Exhibit I hereto solely as permitted pursuant to Section 2(a) of Exhibit B. “Inter-SC Trade” has the meaning set forth in the CAISO Tariff. “Interconnection Agreement” means the interconnection agreement entered into by Seller or an Affiliate pursuant to which the Facility will be interconnected with the PTO’s Transmission System, and pursuant to which Seller’s Interconnection Facilities and any other Interconnection Facilities will be constructed, operated and maintained during the Contract Term.
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“Interconnection Facilities” means the interconnection facilities, control and protective devices and metering facilities required to connect the Facility with the PTO’s Transmission System in accordance with the Interconnection Agreement. “Interest Rate” has the meaning set forth in Section 8.2. “Intertie” has the meaning set forth in the CAISO Tariff. “IP Indemnity Claim” has the meaning set forth in Section 16.1(b). “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 June 27, 2017, as amended from time to time, under which Buyer is organized as a Joint Powers Authority in accordance with the Joint Powers Act.
“kW” means kilowatts in alternating current, unless expressly stated in terms of direct current.
“kWh” means a kilowatt-hour measured in alternating current, unless expressly stated in terms of direct current.
“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 (a) providing senior or subordinated construction, interim, back leverage or long-term debt, 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 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 or tax equity investor directly or indirectly providing financing or refinancing for the Facility or purchasing equity ownership interests of Seller and/or its Affiliates, and any trustee or agent or similar representative acting on their behalf, (b) providing interest rate or commodity protection under an agreement hedging or otherwise mitigating the cost of any of the foregoing obligations and/or (c) 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 having a Credit Rating of at least A- with an outlook designation of “stable” from S&P or A3 with an outlook designation of “stable” from Moody’s, or from an issuer otherwise acceptable to Buyer in its sole discretion,
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in a form substantially similar to the letter of credit set forth in Exhibit K, or as reasonably acceptable to Buyer.
“Licensed Professional Engineer” means either (i) , (ii) , (iii) the independent engineer retained by the Lenders, or on their behalf under customary terms and conditions, in connection with a financing of the Facility, which engineer, or employee or principal thereof (a) is licensed to practice engineering in New Mexico, (b) has training and experience in the power industry specific to the technology of the Facility, (c) is not a representative of a consultant, engineer, contractor, designer or other individual involved in the development of the Facility or of a manufacturer or supplier of any equipment installed at the Facility other than as the independent engineer for the Lenders, and (d) is licensed in an appropriate engineering discipline for the required certification being made, or (iv) a person acceptable to Buyer in its reasonable judgment.
“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(a). “Major Equipment Failure” means a failure of (i) one of the Facility’s (the procurement of which involves a
similarly long lead time), or (ii) no less than of the Facility’s or (iii) no less than of the Facility’s
“Major Planned Outage” means a Planned Outage which results in a reduction of more than to the amount of Resource Adequacy Benefits provided to Buyer from the Facility in any Showing Month.
“Market Curtailment Max Energy” means Buyer’s Share of the total Energy the Facility would have been able to deliver to the Point of Interconnection during a Market Curtailment Period, subject to the Hourly Delivery Cap, if the output of the Facility was not reduced at Seller’s direction, which amount shall be equal to the Real-Time Forecast (of the hourly expected Facility Energy) provided pursuant to Section 4.3(d) for the period of time during such Market Curtailment Period.
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“Market Curtailment Period” means the period of time during a Settlement Interval or Settlement Period, as applicable, in which the LMP in the Day-Ahead Market and the Real-Time Market at the Delivery Point are less than the Floor Price; provided, if applicable, the Market Curtailment Period shall be inclusive of the time required for the Facility to ramp down to implement such curtailment (if any) and ramp up following such curtailment (if any) in accordance with the Operating Restrictions.
“Material Permits” means all permits required for Seller to commence construction that have not been obtained as of the Effective Date, as set forth on Exhibit S. “Maximum Import Capability” has the meaning set forth in the CAISO Tariff, and includes any replacement or successor method implemented by the CAISO with respect to the ability of generating units that are external to the CAISO Balancing Authority Area to provide Resource Adequacy Benefits.
“Milestones” means the significant development activities and dates associated therewith set forth on the Cover Sheet.
“Monthly Forecast” has the meaning set forth in Section 4.3(b). “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 LMP at the Delivery Point in the applicable CAISO market that is less than zero dollars per MWh ($0/MWh). “Negative PTC Amount” means the amount, on a dollar per MWh basis, equal to the PTC Amount that Seller is eligible to earn in respect of Energy from the Facility at the time of calculation, multiplied by negative one (-1).
“NERC” means the North American Electric Reliability Corporation or any successor entity.
“Net Qualifying Capacity” has the meaning set forth in the CAISO Tariff. “Network Upgrades” has the meaning set forth in the CAISO Tariff. “Non-Defaulting Party” has the meaning set forth in Section 11.2. “Non-Summer Month” means any month that is not a Summer Month, commencing as of the month in which the RA Guarantee Date occurs and throughout the Delivery Term.
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“Notice” shall, unless otherwise specified in the Agreement, mean written communications by a Party to be delivered by hand delivery, United States mail, overnight courier service, or electronic messaging (e-mail).
“Operating Restrictions” means the operational characteristics of the Facility set forth in Exhibit U.
“Pacific Prevailing Time” means the prevailing standard time or daylight savings time, as applicable, in the Pacific time zone.
“Participating Transmission Owner” or “PTO” means an entity that owns, operates and maintains the Transmission System or distribution lines and associated facilities and/or has entitlements to use certain transmission or distribution lines and associated facilities where the Facility is interconnected, as set forth in Exhibit A.
“Party” has the meaning set forth in the Preamble.
“Performance Measurement Period” means the prior 24-month period measured from the end of each Contract Year, commencing in the second full Contract Year following the Initial Energy Delivery Date; provided, the first Performance Measurement Period shall be extended to include any period between the Initial Energy Delivery Date and the first day of the first Contract Year of such Performance Measurement Period, and the amount of Expected Energy used in the calculation of the Guaranteed Energy Production for such extended first Performance Measurement Period shall be increased, pro-rata, based on the number of days in such Performance Measurement Period.
“Performance Security” means (i) cash, (ii) one or more Letters of Credit, and/or (iii) a Guaranty, in aggregate in the amount specified for the Performance Security on the Cover Sheet. “Permitted Transferee” means (i) any Affiliate of Seller or (ii) any entity that satisfies, or is controlled by another Person that satisfies, the following requirements:
(a) A tangible net worth plus Unfunded Capital Commitments of not less than or a Credit Rating of at least BBB- from S&P, BBB- from Fitch, or Baa3 from Moody’s; and
(b) At least two (2) years of experience in the ownership and operations of utility-scale wind-powered electricity generation facilities, or has retained a third-party with such experience to operate the Facility.
“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.
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“Planned Outage” means a period during which the Facility is either in whole or in part not capable of providing service due to planned maintenance that has been scheduled in advance in accordance with Sections 4.6(a) and 4.6(c).
“Point of Interconnection” has the meaning set forth in Exhibit A. “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.
“Prevailing Wage” has the meaning set forth in Section 13.4. “Product” has the meaning set forth on the Cover Sheet. “Production Tax Credits” or “PTCs” means production tax credit under Section 45 of the Internal Revenue Code as in effect from time-to-time throughout the Contract Term or any successor or other provision providing for a federal tax credit determined by reference to production of renewable energy for which Seller, as the owner of the Facility, is eligible. “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 industry during the relevant time period with respect to grid-interconnected, utility-scale wind-powered electricity generating facilities in the Western United States, and (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
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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 wind-powered electricity generating facilities in the Western United States. Prudent Operating Practice shall include compliance with applicable Laws, applicable safety and reliability criteria, and the applicable 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 Amount” means the amount, on a dollar per MWh basis, equal to the Production Tax Credits that Seller would have earned in respect of Energy from the Facility at the time, grossed up on an after-tax basis at the then-highest marginal combined federal and New Mexico state corporate tax rate in the aggregate), but failed to earn as a result of Market Curtailment Period, which amount will be calculated by reference to the amount of Deemed Delivered Energy and the number of the Facility’s wind turbines that are eligible to receive Production Tax Credits at the time of determination. “Qualified Forced Facility Outage” means a Forced Facility Outage with respect to which a Licensed Professional Engineer has certified: (i) that the conditions for a Forced Facility Outage have been met (provided, in the event of a removal from service of a component of the Facility as set forth in clause (ii) of the definition of “Forced Facility Outage”, such removal from service must occur no later than following the discovery by Seller of the need for such removal), (ii) that such Forced Facility Outage was not caused by Seller’s fault or negligence, including Seller’s failure to follow Prudent Operating Practices, and (iii) the estimated duration of such Forced Facility Outage.
“Qualified Forced Facility Outage Limit” means
“RA Compliance Showing” means the RAR compliance or advisory showings (or similar or successor showings) an entity is required to make to the CAISO pursuant to the CAISO Tariff, to the CPUC (and, to the extent authorized by the CPUC, to the CAISO) pursuant to the Resource Adequacy Rulings, or to any Governmental Authority.
“RA Compliance Template” means, as of the Effective Date, the tab titled “LSE Showing Complete” on the CPUC website at https://www.cpuc.ca.gov/-/media/cpuc-website/divisions/energy-division/documents/resource-adequacy-homepage/resource-adequacy-compliance-materials/guides-and-resources/rashowingtemplate_rev35.xlsm, as such document may be updated or replaced by the CPUC from time to time.
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“RA Deficiency Amount” means the liquidated damages payment that Seller shall pay to Buyer for an applicable RA Shortfall Amount as calculated in accordance with Section 3.8(b). “RA Deficiency Cap” shall mean, for each Showing Month, the corresponding dollar amount set forth below:
RA Deficiency Cap
Showing Month $/kW-month
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
“RA Guarantee Date” means the Commercial Operation Date; provided, if the Facility is not delivering Resource Adequacy Benefits to Buyer for the Showing Month in which the Commercial Operation Date occurs, the RA Guarantee Date shall be the earlier of (i) the first day of the Showing Month in which the Facility is delivering Resource Adequacy Benefits to Buyer, and (ii) the first day of the Showing Month following the date that is after the Commercial Operation Date.
“RA Plan” means each of (a) Buyer’s monthly or annual “Resource Adequacy Plan” (as defined in the CAISO Tariff) filed with the CAISO, and (b) Buyer’s monthly or annual resource adequacy plans filed with the CPUC.
“RA Shortfall Amount” has the meaning set forth in Section 3.8(b). “RA Shortfall Month” means, for purposes of calculating an RA Deficiency Amount under Section 3.8(b), any Showing Month during which the RA Shortfall Amount is greater than zero (0) kW.
“RA Substitute Capacity” has the meaning set forth in the CAISO Tariff. As of the Effective Date, the Parties agree that the amount of RA Substitute Capacity delivered by Seller for a given Showing Month shall be determined by calculating the quotient of (i) the sum of the following: for each hour of the twenty-four hour array applicable to such Showing Month, the amount of RA Substitute Capacity (in MW) that Seller provided in accordance with the CAISO Tariff, divided by (ii) twenty four (24).
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“Real-Time Forecast” has the meaning set forth in 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. “REC Price” means the prevailing market price (expressed in $/MWh) for RECs meeting the RPS requirements for Portfolio Content Category 1, determined by averaging quotes provided by Buyer from three (3) unaffiliated brokers.
“Receiving Party” has the meaning set forth in Section 18.2. “Recurring Certificate Transfers” has the meaning set forth in the WREGIS Operating Rules.
“Remedial Action Plan” has the meaning set forth in Section 2.4. “Renewable Energy Credit” or “REC” 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 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, including a cash grant available under Section 1603 of Division B of the American Recovery and Reinvestment Act of 2009, in lieu of federal Tax credits or any similar or substitute payment available under subsequently enacted federal legislation; and (c) any other form of incentive relating in any way to the Facility that is not a Green Attribute, Future Environmental Attribute, or Capacity Attribute.
“Replacement Energy” has the meaning set forth in Exhibit G. “Replacement Green Attributes” has the meaning set forth in Exhibit G. “Replacement Product” has the meaning set forth in Exhibit G. “Replacement RA” means resource adequacy benefits from the Facility or from one or more resources (individually or in the aggregate), in each case that are reasonably comparable to the Resource Adequacy Benefits (including, if applicable under then-current Law, having MW values for each hour of the twenty-four (24) hour Slice-of-Day framework that are the same as or greater than those then applicable to the Facility) delivered to the Delivery Point or to another point within the CAISO grid and provided by Seller to Buyer in accordance with Section 3.7(e); provided, notwithstanding anything else herein, unless and until there is a change, after the Effective Date, to the manner of determining the resource adequacy benefits available from any
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wind facility located in New Mexico causing such resource adequacy benefits to be no longer comparable to the Resource Adequacy Benefits available from the Facility (including due to the performance of any particular wind facility), any resource adequacy benefits from any such wind facility which Seller provides to Buyer in accordance with Section 3.7(e) shall be deemed to satisfy the requirements of this definition of “Replacement RA”. As of the Effective Date, the Parties agree that the amount of Replacement RA delivered by Seller for a given Showing Month shall be determined by calculating the quotient of (i) the sum of the following: for each hour of the twenty-four hour array applicable to such Showing Month, the resource adequacy benefits (in MW) that Buyer would receive, as set forth in the relevant RA Compliance Template, assuming that Buyer’s RA Plan in respect of the Replacement RA matches the Supply Plan submitted by Seller in respect of the Replacement RA, divided by (ii) twenty four (24). “Requested Confidential Information” has the meaning set forth in Section 18.2. “Resource Adequacy Benefits” means the rights and privileges attached to Buyer’s Share of the Capacity Attributes available from the Facility that satisfy any entity’s resource adequacy obligations, as those obligations are set forth in any Resource Adequacy Rulings and shall include flexible capacity and any local, zonal or otherwise locational attributes associated with the Facility, if any.
“Resource Adequacy Requirements” or “RAR” means the resource adequacy requirements applicable to an entity as established by the CAISO pursuant to the CAISO Tariff, by the CPUC pursuant to the Resource Adequacy Rulings, or by any other Governmental Authority.
“Resource Adequacy Rulings” means CPUC Decisions 04-01-050, 04-10-035, 05-10-042, 06-04-040, 06-06-064, 06-07-031, 07-06-029, 08-06-031, 09-06-028, 10-06-036, 11-06-022, 12-06-025, 13-06-024, 14-06-050, 15-06-063, 16-06-045, 17-06-027, 18-06-030, 18- 06-031, 19-02-022, 19-06-026, 19-10-021, 20-01-004, 20-03-016, 20-06-002, 20-06-028, 20-06- 031, 20-12-006, 21-06-029, 21-07-014, 22-03-034, 22-06-050, 22-12-028, 22-08-039, 23-04-010, 24-06-004, and any other existing or subsequent ruling or decision, or any other resource adequacy laws, rules or regulations enacted, adopted or promulgated by any applicable Governmental Authority, however described, as such decisions, rulings, Laws, rules or regulations may be amended or modified from time-to-time throughout the Contract Term. “S&P” means the Standard & Poor’s Financial Services, LLC (a subsidiary of S&P Global Inc.) or its successor.
“Schedule” has the meaning set forth in the CAISO Tariff, and “Scheduled” and “Scheduling” have a corollary meaning.
“Scheduled Energy” means the Facility Energy scheduled by Seller that clears under the applicable CAISO market based on the final Day-Ahead Schedule, FMM Schedule (as defined in the CAISO Tariff), and/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.
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“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.
“Scheduling Point” has the meaning set forth in the CAISO Tariff. “Second A&R Agreement” has the meaning set forth in the Recitals hereto. “Security Interest” has the meaning set forth in Section 8.9. “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 4.8(a). “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 zero dollars ($0). 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.
“Shared Facilities Agreements” has the meaning set forth in Section 6.3. “Showing Deadline” means, for any Showing Month, the deadline for submitting a Supply Plan or RA Plan, as applicable, applicable to that Showing Month, as established by the CAISO. “Showing Month” shall be the calendar month of the Delivery Term, commencing with the Showing Month that contains the RA Guarantee Date, that is the subject of the RA Compliance Showing, as set forth in the Resource Adequacy Rulings and outlined in the CAISO Tariff. For illustrative purposes only, pursuant to the CAISO Tariff and Resource Adequacy Rulings in effect as of the Effective Date, the monthly RA Compliance Showing made in June is for the Showing Month of August.
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“Site” means the real property on which the Facility is or will be located, as further described in Exhibit A,; provided, any such update to the Site that includes real property that was not originally contained within the Site boundaries described in Exhibit A shall be subject to Buyer’s approval of such updates in its sole discretion. “Site Control” means that Seller: (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. “Slice-of-Day” has the meaning set forth in the Resource Adequacy Rulings. “SOD Coefficient” means the amount, for each Showing Month, set forth in the table below:
Month SOD Coefficient
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
“South Affiliate” means SunZia Wind South LLC.
“SP-15” means the Existing Zone Generation Trading Hub for Existing Zone region SP15 as set forth in the CAISO Tariff.
“Station Use” means the Energy (including Energy produced by the Facility) that is used within the Facility to power the lights, motors, temperature control systems, control systems and other electrical loads that are necessary for operation of the Facility, and/or that is consumed within the Facility’s electric energy distribution system as losses. “Summer Month” means any of June, July, August September and October, commencing as of the month in which the RA Guarantee Date occurs and throughout the Delivery Term. “SunZia Transmission Line” means that certain 3,000-MW high-voltage (+/-525-kV) transmission line originating at the Point of Interconnection in New Mexico and terminating near Phoenix, Arizona. The western terminus of the line will connect to the 500-kV Pinal Central Substation.
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“Supply Chain Code” has the meaning in Exhibit Q.
“Supply Plan” has the meaning set forth in the CAISO Tariff, as applicable to the Guaranteed RA Amount from the Facility.
“System Emergency” means any condition that requires, as determined and declared by CAISO or a Transmission Provider, 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 Governmental Authority, whether currently in effect or adopted during the Contract Term, including ad valorem, excise, franchise, gross receipts, import/export, license, property, sales and use, stamp, transfer, payroll, unemployment, income, and any and all items of withholding, deficiency, penalty, additions, interest or assessment related thereto. “Tax Credits” means the PTC, ITC and any other state, local and/or federal production tax credit, depreciation benefit, tax deduction and/or investment tax credit specific to the production of renewable energy and/or investments in renewable energy facilities. “Terminated Transaction” has the meaning set forth in Section 11.2(a). “Termination Payment” has the meaning set forth in Section 11.3(b).
“Transmission Provider” means any entity that (i) owns, operates and maintains transmission or distribution lines and associated facilities and/or has entitlements to use certain transmission or distribution lines and associated facilities, and (ii) transmits or transports the Product on behalf of Seller or Buyer to or from the Delivery Point, including the Participating Transmission Owner.
“Transmission System” means the transmission facilities operated by the Transmission Providers, now or hereafter in existence, which provide energy transmission service upstream to or downstream from the Delivery Point.
“Transmission System Outage” means an outage on a Transmission System, other than a System Emergency, that prevents (i) Buyer from receiving, or (ii) Seller from delivering, Energy at the Delivery Point.
“Ultimate Parent” means Pattern Energy Group LP.
“Unfunded Capital Commitments” means as of any date of determination, the aggregate amount of all currently-available but undrawn capital obligated to be provided to a Person by investor(s) pursuant to binding, written agreements, not subject to the satisfaction of any conditions precedent to such funding outside the control of such Person.
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“Variable Energy Resource” or “VER” has the meaning set forth in the CAISO Tariff. “WREGIS” means the Western Renewable Energy Generation Information System or any successor renewable energy tracking program.
“WREGIS Certificate Deficit” has the meaning set forth in Section 4.8(e). “WREGIS Certificates” has the same meaning as “Certificate” as defined by WREGIS in the WREGIS Operating Rules and are designated as eligible for complying with the California Renewables Portfolio Standard.
“WREGIS Operating Rules” means those operating rules and requirements adopted by WREGIS as of October 2022, as subsequently amended, supplemented or replaced (in whole or in part) from time to time.
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 Article, 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 shall mean 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 terms “include” and “including” mean “include or including (as applicable) without limitation” and any list of examples following such term shall in no way restrict or limit the generality of the word 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
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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) the expression “and/or” when used as a conjunction shall connote “any or all of”;
(l) 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
(m) 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) Conditions Precedent to Contract Term. This Agreement shall become effective 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 set forth herein (“Contract Term”); provided, 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) Continuing Provisions. 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 shall remain in full force and effect for two (2) years following the termination of this Agreement, and all indemnity and audit rights shall remain in full force and effect for one (1) year following the termination of this Agreement.
Conditions Precedent to Delivery.
(a) The Delivery Term shall not commence until Seller completes to Buyer’s reasonable satisfaction each of the following conditions, which Buyer shall, if submitted by Seller within thirty (30) days of the expected Commercial Operation Date, review and either accept or
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provide Notice stating in reasonably detail the basis for Buyer’s rejection thereof within five (5) Business Days of receipt thereof. If there is a dispute between Buyer and Seller as to whether Commercial Operation has occurred, then either Party may elect to immediately refer the matter to the dispute resolution procedures set forth in Article 15, and all payments of Commercial Operation Delay Damages from and after the date such dispute is initiated shall be tolled until the dispute is resolved. If the dispute is resolved in favor of Seller, the Commercial Operation Date shall be the date proposed by Seller prior to such dispute and no Commercial Operation Delay Damages shall be owed from Seller from and after such date, and if the dispute is resolved in favor of Buyer, Commercial Operation Delay Damages (if any) shall be due as set forth in Exhibit B. (i) Seller shall have delivered to Buyer certificates from a Licensed Professional Engineer substantially in the form of Exhibit H and Exhibit I; (ii) A Participating Generator Agreement (as defined in the CAISO Tariff) between Seller and CAISO and a Meter Service Agreement for CAISO Metered Entities (as defined in the CAISO Tariff) between CAISO and Seller (if, with respect to each such agreement, it is required under the CAISO Tariff or for Seller to meet its obligations under this Agreement), shall have been executed and delivered and be in full force and effect and a copy of such agreements delivered to Buyer;
(iii) All applicable regulatory authorizations, approvals and permits necessary for the operation of the Facility have been obtained and all conditions thereof that are capable of being satisfied on the Commercial Operation Date have been satisfied and shall be in full force and effect;
(iv) Seller has obtained CAISO Certification for the Facility; (v) Seller has delivered the Performance Security to Buyer in accordance with Section 8.8;
(vi) Seller has delivered to Buyer an officer’s certificate stating that Seller has not utilized any equipment or resources in connection with the construction, commissioning or testing of the Facility in violation of Section 2.3(b); and (vii) Seller has paid Buyer for all amounts due and owing by Seller under this Agreement as of the Commercial Operation Date, if any, including Delay Damages. (b) The Initial Energy Delivery Date shall not occur until Seller completes to Buyer’s reasonable satisfaction each of the following conditions, which Buyer shall, if submitted by Seller within thirty (30) days of the expected Initial Energy Delivery Date, review and either accept or provide Notice stating in reasonably detail the basis for Buyer’s rejection thereof within five (5) Business Days of receipt thereof. If there is a dispute between Buyer and Seller as to whether the Initial Energy Delivery Date has occurred, then either Party may elect to immediately refer the matter to the dispute resolution procedures set forth in Article 15. If the dispute is resolved in favor of Seller, the Initial Energy Delivery Date shall be the date proposed by Seller prior to
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such dispute, and if the dispute is resolved in favor of Buyer, the Initial Energy Delivery Date shall be deemed not to have occurred upon the date claimed by Seller. (i) Seller has received final CEC Certification and Verification for the Facility; and
(ii) Seller (with the reasonable participation of Buyer) shall have completed all applicable WREGIS registration requirements, including the completion and submittal of all applicable registration forms and supporting documentation, which may include applicable interconnection agreements, informational surveys related to the Facility, QRE service agreements, and other appropriate documentation required to effect Facility registration with WREGIS and to enable Renewable Energy Credit transfers related to the Facility within the WREGIS system.
Development; Construction; Progress Reports.
(a) Within fifteen (15) days after the close of each calendar month from the first calendar month following the Effective Date until the Commercial Operation Date, Seller shall provide to Buyer a Progress Report and agree to regularly scheduled meetings between representatives of Buyer and Seller to review such reports and discuss Seller’s construction progress. The form of the Progress Report is set forth in Exhibit E. Seller shall also provide Buyer with any reasonably requested documentation and additional information (subject to confidentiality restrictions) directly related to the achievement of Milestones within ten (10) Business Days of receipt of such request by Seller. Seller is solely responsible for the design and construction of the Facility, including the location of the Site, the Facility layout, and the selection and procurement of the equipment comprising the Facility. (b) Seller shall use commercially reasonable efforts to ensure that all materials, products and components that are used in constructing, installing and operating the Facility throughout the Contract Term and provided by Seller and Seller’s contractors and suppliers in direct contract with Seller or Seller’s Affiliates shall be in compliance with the Supply Chain Code.
Seller shall comprehensively implement due diligence procedures for its and its Affiliate’s first-tier subcontractors and suppliers, and other subcontractors and suppliers to the extent reasonably practicable. Seller shall notify Buyer as soon as reasonably practicable if it becomes aware of any breach of its obligations under this Section 2.3(b).
(c) Buyer shall have the right, at Buyer’s sole expense, to retain an independent auditor to audit Seller’s compliance with the requirements of Section 2.3(b).
Remedial Action Plan. If Seller misses a Milestone by more than thirty (30) days, except as the result of Force Majeure Event or Buyer Default, in addition to updates provided to Buyer via Progress Reports delivered pursuant to Section 2.3, Seller shall submit to Buyer, within ten (10) Business Days of the end of such thirty (30)-day period following the Milestone completion date, a remedial action plan (“Remedial Action Plan”), which will describe in detail any delays (actual or anticipated) beyond the scheduled Milestone dates, including the cause of the delay (e.g., governmental approvals, financing, property acquisition, design activities, equipment
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procurement, project construction, interconnection, or any other factor), Seller’s detailed description of its proposed course of action to achieve the missed Milestones and all subsequent Milestones by the Guaranteed Commercial Operation Date, as it may be extended; provided, delivery of any Remedial Action Plan shall not relieve Seller of its obligation to provide Remedial Action Plans with respect to any subsequent Milestones and to achieve the Guaranteed Commercial Operation Date in accordance with the terms of this Agreement. Subject to the provisions of Exhibit B, so long as Seller complies with its obligations under this Section 2.4, Seller shall not be considered in default of its obligations under this Agreement solely as a result of missing any Milestone.
ARTICLE 3
PURCHASE AND SALE
Purchase and Sale of Product. Subject to the terms and conditions of this Agreement, during the Delivery Term, Buyer shall purchase all the Product produced by or associated with the Facility at the Contract Rate and in accordance with Exhibit C, and Seller shall supply and deliver to Buyer all the Product produced by or associated with the Facility; provided, prior to the Initial Energy Delivery Date the Product shall be limited to Capacity Attributes and Resource Adequacy Benefits.
The sale by Seller and purchase by Buyer of Facility Energy hereunder shall be for resale; provided, no such re-sale or use shall relieve Buyer of any obligations hereunder. During the Delivery Term, Buyer shall have exclusive rights to offer, bid, or otherwise submit the Product, and/or any component thereof, from the Facility after the Delivery Point for resale in the market, and retain and receive any and all related revenues.
Sale of Green Attributes. During the Delivery Term, on and after the Initial Energy Delivery Date, Seller shall sell and deliver to Buyer, and Buyer shall purchase from Seller, all Green Attributes attributable to the Facility Energy. Upon request of Buyer, Seller shall use commercially reasonable efforts to (a) submit, and receive approval from the Center for Resource Solutions (or any successor that administers the Green-e Certification process), for the Green-e tracking attestations and (b) support Buyer’s efforts to qualify the Green Attributes transferred by Seller as Green-e Certified, in each case with respect to the portion of the Delivery Term on and after the Initial Energy Delivery Date.
Imbalance Energy. Buyer and Seller recognize that in any given Settlement Period or Settlement Interval, as applicable, the amount of Facility Energy may deviate from the amounts thereof scheduled with the CAISO. To the extent there are such deviations, any costs, liabilities or revenues from such imbalances shall be solely for the account of Seller as Scheduling Coordinator hereunder, except as expressly set forth in this Agreement.
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
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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 anticipated to be 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 to Section 3.5(b), in such event, Buyer shall bear all costs associated with the transfer, qualification, verification, registration and ongoing compliance for such Future Environmental Attributes, but there shall be no increase in the Contract Rate. 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 alter the Facility or the operation of the Facility unless the Parties have agreed on all necessary terms and conditions relating to such alteration or change in operation and Buyer has agreed to reimburse Seller for all costs, losses, and liabilities associated with such alteration or change in operation. (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; provided, the Parties acknowledge and agree that such terms are not intended to alter the other material terms of this Agreement.
[Reserved].
Capacity Attributes.
(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 3.7(d) and Section
3.12, Seller shall perform all commercially reasonable actions necessary to ensure that the Facility qualifies to provide all Resource Adequacy Benefits to Buyer at the Delivery Point. Throughout the Delivery Term, and subject to Section 3.7(d) and 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 actions, including complying with all applicable registration and reporting requirements, and execute all documents or instruments that are reasonable and necessary to enable Buyer to use all of the Capacity Attributes committed by Seller to Buyer pursuant to this Agreement, including submitting Supply Plans in accordance with CAISO and CPUC requirements and the requirements of this Agreement. At least prior to the
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CAISO submission deadline for each annual RA Plan, and at least prior to the Showing Deadline for each monthly RA Plan
, Seller shall provide a non-binding Notice to Buyer presenting the Resource Adequacy Benefits that Seller expects to include in such Supply Plan for the next calendar year or Showing Month, including any Replacement RA Seller commits to provide pursuant to Section 3.7(e), if applicable; provided, if Seller becomes aware of any change to the Resource Adequacy Benefits that Seller is able to include in any monthly Supply Plan after delivering any such Notice, Seller shall provide a Notice to Buyer of any such change as soon as reasonably practicable,
(d) Buyer acknowledges that during some or all of the Delivery Term, it will be required to take certain actions and obtain certain rights at the Delivery Point in order to make use of the Capacity Attributes associated with the Product, including: (a) at least until such time as the Facility receives a Deliverability Allocation from the CAISO, maintaining Import Capability necessary to import the Guaranteed RA Amount into the CAISO at the Delivery Point, (b) timely filing its RA Plans as required by the CAISO and the CPUC, and (c) obtaining any other rights or capacities that Buyer is required to obtain, or take any other action that Buyer is required to take, in order for Seller to provide or Buyer to make use of the Capacity Attributes of the Facility, in each case as may be required under applicable Law and as may change from time to time. To the extent Buyer does not or cannot maintain Import Capability (solely until such time as the Facility receives a Deliverability Allocation from the CAISO) or any other rights or capacities necessary to support the importation of the Guaranteed RA Amount into the CAISO or otherwise receive or utilize the Capacity Attributes, for reasons other than a Seller failure under this Agreement, including Seller’s failure to comply with applicable CPUC and CAISO requirements necessary to qualify the Facility as a Resource Adequacy Resource located within the CAISO Balancing Authority Area, the Capacity Attributes that are not delivered or that cannot be delivered (or that Buyer cannot make use of) shall constitute Deemed Delivered RA; provided, if Buyer is unable to obtain or utilize any portion of the Import Capability due to any allocation of Deliverability (as defined in the CAISO Tariff) to the Facility that is not a Deliverability Allocation and, as a result, Seller is unable to deliver to Buyer an amount of Resource Adequacy Benefits equal to the Guaranteed RA Amount, then such portion of the Capacity Attributes that are not delivered or that cannot be delivered (or that Buyer cannot make use of) shall not constitute Deemed Delivered RA but shall constitute a shortfall for which Seller owes to Buyer the RA Deficiency Amount. (e) If Seller anticipates that it will have any RA Shortfall Amounts in a Showing Month from and after the RA Guarantee Date, Seller may provide Replacement RA in the amount of (X) Guaranteed RA Amount, minus (Y) the expected amount of Resource Adequacy Benefits Seller includes in its Notice provided to Buyer pursuant to Section 3.7(c) with respect to such Showing Month.
(f) Seller shall provide RA Substitute Capacity in accordance with applicable CAISO requirements in connection with Facility outages. Seller acknowledges and agrees that any
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failure by Seller to provide such RA Substitute Capacity may result in CAISO rejecting or cancelling Seller’s request for CAISO to approve such Facility outage. (g) The Parties acknowledge that following the Effective Date there may be changes of Applicable Laws with respect to the rules for Resource Adequacy Benefits that in certain respects may be inconsistent with the provisions of this Agreement. The Parties shall negotiate in good faith to further amend this Agreement to resolve any such inconsistencies between this Agreement and such changes to Applicable Law; provided, the intent of the negotiations shall be to maintain the balance of the Parties’ benefits, burdens, and obligations set forth in this Agreement as of the Effective Date ; provided further, any amendment to this Agreement pursuant to this Section 3.7(g) shall be subject to Lender consent.
Resource Adequacy Failure.
(a) RA Deficiency Determination. For each RA Shortfall Amount, Seller shall pay to Buyer the RA Deficiency Amount as liquidated damages, as the sole and exclusive remedy for the Capacity Attributes that Seller failed to convey to Buyer. (b) RA Deficiency Amount Calculation. For any Showing Month from and after the RA Guarantee Date, the “RA Deficiency Amount” shall equal the product of (i) the difference, expressed in kW, of (A) the Guaranteed RA Amount, minus , minus (C) Deemed Delivered RA in respect of such Showing Month, minus (D) Replacement RA delivered in respect of such Showing Month, minus (E) RA Substitute Capacity delivered in respect of such Showing Month (such difference, the “RA Shortfall Amount”), multiplied by (ii) the lesser of (A) the product of (X) the CPM Soft Offer Cap (or its successor) multiplied by (Y) the CPM Adjustment Factor (“CPM Price”) multiplied by , and (B) the RA Deficiency Cap for the applicable
Showing Month multiplied by
Notwithstanding anything else in this Section 3.8,
CEC Certification and Verification. Subject to Section 3.12 and in accordance with the timing set forth in this Section 3.9, Seller shall take all necessary steps including, but not limited to, making or supporting timely filings with the CEC to obtain and maintain CEC Certification and Verification for the Facility on and after the Initial Energy Delivery Date, including compliance with all applicable requirements for certified facilities set forth in the current version of the RPS Eligibility Guidebook (or its successor). Seller shall obtain final CEC Certification and Verification for the Facility on or before the Initial Energy Delivery Date and shall maintain final CEC Certification and Verification for the remainder of the Delivery Term. Seller must promptly notify Buyer and the CEC of any changes to the information included in Seller’s application for CEC Certification and Verification for the Facility.
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Eligibility. Seller, and, if applicable, its successors, represents and warrants that throughout the Delivery Term of this Agreement that: (i) the Project qualifies and is certified by the CEC as an Eligible Renewable Energy Resource (“ERR”) as such term is defined in Public Utilities Code Section 399.12 or Section 399.16; and (ii) the Project’s output delivered to Buyer qualifies under the requirements of the California Renewables Portfolio Standard. To the extent a change in law occurs after execution of this Agreement that causes this representation and warranty to be materially false or misleading, it shall not be an Event of Default if Seller has used commercially reasonable efforts to comply with such change in law. [STC 6] California Renewables Portfolio Standard. Subject to Section 3.12, on and after the Initial Energy Delivery Date, Seller shall also take all other actions necessary to ensure that the Facility Energy 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.
Compliance Expenditure Cap. If a change in Law occurring after the Effective Date has increased Seller’s cost to comply with Seller’s obligations under this Agreement with respect to obtaining, maintaining, conveying or effectuating Buyer’s use of Green Attributes, Capacity Attributes, CEC Certification and Verification, and/or WREGIS Certificates (as applicable), 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 Twenty-Five Thousand Dollars ($25,000) per MW of Guaranteed Capacity (“Compliance Expenditure Cap”).
(a) 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.” (b) 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. (c) 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 does not respond to a Notice given by Seller under this Section 3.12 within sixty (60) days after Buyer’s receipt of same, Buyer shall be deemed to have waived its rights to require Seller to take the Compliance Actions that are the subject of the Notice, and Seller shall have no further obligation to take, and no liability for any failure to take, such Compliance Actions until such time as Buyer agrees to pay such Accepted Compliance Costs.
(d) 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
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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.
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 shall discuss in good faith potential reconfiguration of the Facility or Interconnection Facilities, which discussion either Party may terminate in its sole discretion at any time; provided, 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 in the sole discretion of each as set forth in a written agreement.
ARTICLE 4
OBLIGATIONS AND DELIVERIES
Delivery.
(a) Energy. Subject to the provisions of this Agreement, commencing on the Initial Energy Delivery Date through the end of the Contract Term, Seller shall supply and deliver the Facility Energy and associated Green Attributes to Buyer at the Delivery Point, and Buyer shall take delivery of the Facility Energy and associated Green Attributes, and Replacement Product, at the Delivery Point in accordance with the terms of this Agreement. Seller shall effectuate the delivery of Facility Energy and shall be responsible for securing such arrangements with CAISO, the PTO and any other Transmission Provider as are necessary in connection therewith. Seller shall be responsible for paying or satisfying when due any costs or charges (except as otherwise set forth in this Agreement) imposed in connection with the delivery of Facility Energy to the Delivery Point, including 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 (except as otherwise set forth in this Agreement), 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. The Facility Energy will be scheduled with the CAISO by Seller (or Seller’s designated Scheduling Coordinator) in accordance with Exhibit D. (b) Green Attributes. All Green Attributes associated with the Facility Energy during the Delivery Term, on and after the Initial Energy Delivery Date 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 Buyer’s Share of all such Green Attributes to Buyer as included in the delivery of the Product from the Facility. (c) Energy Products. If, at any time during the Contract Term following the Initial Energy Delivery Date, Buyer requests Seller to provide any new or different Energy-related products or Ancillary Services that may become recognized from time to time in the CAISO market, and Seller is able to provide any such product from the Facility without material adverse effect (including any obligation to incur more than de minimis costs, expenses or liabilities, or any more than de minimis impacts on the operations of Seller, any of Seller’s Affiliates, or the Facility) on Seller, Seller’s Affiliates or the Facility or Seller’s obligations or liabilities under this Agreement or any other agreement, then Seller shall use commercially reasonable efforts to
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coordinate with Buyer to provide such product. If provision of any such new product would have a material adverse effect (including any obligation to incur more than de minimis costs, expenses or liabilities, or any more than de minimis impacts on the operations of Seller, any of Seller’s Affiliates, or the Facility) on Seller, Seller’s Affiliates or the Facility or Seller’s obligations or liabilities under this Agreement or any other agreement, then Seller shall be obligated to provide such product only if the Parties first execute an amendment to this Agreement with respect to such product that is mutually acceptable to both Parties.
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.
Forecasting. Seller shall provide the forecasts described below. Seller shall use commercially reasonable efforts to forecast accurately and to transmit such information in a format reasonably acceptable to Buyer (or Buyer’s designee). Seller shall use reasonable efforts to provide forecasts that are consistent with the information known by Seller at the time the forecasts are submitted 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 Practice. (a) Annual Forecast of Facility Energy. No less than forty-five (45) days before (i) the first day of the first Contract Year of the Delivery Term and (ii) the compliance deadline for the annual RA Plan (which is currently the last Business Day of October that is prior to commencement of the year for the annual RA Plan) for every subsequent Contract Year during the Delivery Term, Seller shall provide to Buyer a non-binding forecast of expected Facility 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 Facility Energy and Available Capacity. No less than thirty (30) days before the beginning of Commercial Operation, and thereafter fifteen (15) days before the applicable RA Plan Showing Deadline for each Showing Month during the Delivery Term, Seller shall provide to Buyer a non-binding forecast of the hourly expected (i) Available Capacity and (ii) Facility Energy (only with respect to the period on and after the Initial Energy Delivery Date) (items (i)-(ii) collectively referred to as the “Forecasted Product”), for each day of the following month in a form substantially similar to Exhibits F-1 and F-2, as applicable (“Monthly Forecast”).
(c) Day-Ahead Forecast. On and after the Initial Energy Delivery Date, by 5:30 AM Pacific Prevailing Time on the Business Day immediately preceding the date of delivery of Facility Energy, Seller shall provide Buyer with a non-binding forecast of the hourly expected Available Capacity and the Day-Ahead Forecast.
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(d) Real-Time Forecasts. On and after the Initial Energy Delivery Date, Seller shall, or shall cause its authorized representative to, notify Buyer of any changes from the Day-Ahead Forecast resulting from changes of fifteen (15) MW or more in Available Capacity or when the expected Facility Energy, net of all Electrical Losses, differs by more than fifteen (15) MWh, as applicable, of the amount set forth in the Day-Ahead Forecast, in each case whether due to a Forced Facility Outage, Force Majeure Event or other cause affecting the Available Capacity, 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.
Such updated forecast shall be deemed the “Real-Time Forecast”; provided, if there are no such changes from the Day-Ahead Forecast, the Day-Ahead Forecast for the applicable day shall be deemed the Real-Time Forecast. If the Available Capacity or, if applicable, the expected Facility Energy, changes by at least fifteen (15) MW or fifteen (15) MWh, as applicable, 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 Facility Energy shall be based on a forecast from the Approved Forecast Vendor and shall contain information regarding the beginning date and time of the event resulting in the change in Available Capacity or the expected Facility 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 use commercially reasonable efforts to inform Buyer of any developments that are reasonably likely to affect either the duration of such outage or the availability of the Facility during or after the end of such outage. Such Real-Time Forecasts shall be communicated in a method reasonably acceptable to Buyer, provided that Buyer specifies the method no later than sixty (60) 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) Meteorological Data.
(i) Commencing on the Initial Energy Delivery Date, and continuing throughout the Delivery Term, Seller shall provide to Buyer records of meteorological measurements based on output from reasonably representative meteorological stations installed at the Site, which shall be either
which measurements shall be provided
by Seller to Buyer
(provided, Buyer shall have the option to elect, no more than once per calendar year, the method of delivery as set forth in subsections (x) or (y) above upon no less than prior written Notice to Seller of such election), in each case including the following data points:
(A) wind speed (and, if Seller elects to receive meteorological data as set forth in 4.3(e)(y) above, the highest 3-second wind gust within ten (10) minutes), (B) wind direction, (C) ambient air temperature, (D) precipitation (rain rate), (E) precipitation (running thirty (30)-day total), and (F) barometric pressure; provided, the method of data delivery and the foregoing data points specified under this Section 4.3(e) may be updated as reasonably agreed to by the Parties. Such updates may
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include modifications to or additions of data points as are reasonably necessary for Buyer’s administration of this Agreement, to the extent that Seller can effectuate such updates through the use of commercially reasonable efforts.
(ii) All information provided to Buyer pursuant to this Section
4.3(e) shall constitute Confidential Information of Seller, and Buyer shall be prohibited from providing any such information to any other Person without Seller’s express written prior consent (in Seller’s sole discretion). Seller shall not be obligated to provide any assistance to Buyer with respect to using, interpreting or otherwise processing such data, but Seller shall respond to Buyer’s reasonable requests for clarifying or correcting information.
4.4 Dispatch Down/Curtailment.
(a) General. On and after the Initial Energy Delivery Date, Seller agrees to reduce the amount of Facility Energy produced by the Facility, by the amount and for the period set forth in any Curtailment Order; provided, Seller is not required to reduce such amount to the extent it is inconsistent with the limitations of the Facility set forth in the Operating Restrictions. (b) Alternative Delivery Point/Third-Party Sales. In the event that, and for so long as, at any point on and after the Initial Energy Delivery Date, Seller is unable, despite using commercially reasonable efforts, to deliver all or a portion of the Product to Buyer at the Delivery Point, but is able to deliver Product to Buyer at one or more Alternative Delivery Points, such Alternative Delivery Points shall be considered the Delivery Point for all purposes under this Agreement.
(c) Failure to Comply. Subject to Section 4.4(a), if Seller fails to comply with a Curtailment Order on and after the Initial Energy Delivery Date,, then, for each MWh of Facility Energy that is delivered in excess of the Curtailment Order, Seller shall pay Buyer for each such MWh the amount, if any, paid to Seller by Buyer for delivery of such excess MWh. (d) Seller Equipment Required for Operating Instruction Communications.
Seller shall develop and install all communications systems necessary for the operation of the Facility in accordance with Prudent Operating Practice, including communications systems that provide for the receipt and following of automated dispatch instructions from the CAISO.
Station Use. Notwithstanding anything to the contrary in this Agreement, the Parties acknowledge (i) Seller is responsible for providing all Energy to serve Station Use (including paying the cost of
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any Energy used to serve Station Use), (ii) the supply of such Station Use shall not be deemed a violation of this Agreement, (provided, Seller shall indemnify and hold harmless Buyer from any and all costs, penalties, charges or other adverse consequences that result from Energy supplied for Station Use by any means other than retail service from the applicable utility, and shall take any additional measures to ensure Station Use is supplied by the applicable utility’s retail service if necessary to avoid any such costs, penalties, charges or other adverse consequences), and (iii) Station Use may not be supplied from Facility Energy (provided, Seller may supply Station Use from Energy produced by the Facility so long no such Energy is recorded as Facility Energy by the Facility Meter, and subject to the other requirements of this Agreement).
Facility Maintenance. Without limiting Section 3.1 or Exhibit G:
(a) Seller shall provide to Buyer written schedules for Planned Outages for each calendar year no later than September 1 of the prior calendar year for each following calendar year.
Buyer may provide comments no later than ten (10) days after receiving any such schedule, and Seller shall in good faith take into account any such comments. Seller shall promptly deliver to Buyer the final updated schedule of Planned Outages thereafter. Seller shall be permitted to reduce deliveries of Product during any period of such Planned Outages. (b) If reasonably required in accordance with Prudent Operating Practices, Seller may perform maintenance at a different time than maintenance scheduled pursuant to Section 4.6(a). Seller shall be responsible, at no additional cost to Buyer, to provide any replacement Capacity Attributes required by the CAISO in connection with the CAISO’s approval of any Seller request for a Planned Outage after the applicable Supply Plan has been submitted. (c) Notwithstanding anything in this Agreement to the contrary, no Planned Outages of the Facility shall be scheduled or planned during any Summer Month during the Delivery Term ,
unless (i) such outage is required to avoid damage to the Transmission System, (ii)
, (iv) such outage is reasonably required to maintain
health and safety pursuant to Section 6.2, or (v) the Parties agree otherwise in writing. In the event that Seller has a previously Planned Outage that becomes coincident with a System Emergency that prevents Seller from reasonably performing the contemplated maintenance activities, Seller shall make commercially reasonable efforts to reschedule such Planned Outage. (d) Seller shall be permitted to reduce deliveries of Product during any Forced Facility Outage. Seller shall promptly provide Buyer with Notice and expected duration (if known) of any Forced Facility Outage and 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 such outage.
(e) Seller shall be permitted to reduce deliveries of Product (i) during any period of System Emergency, (ii) pursuant to a Curtailment Order, (iii) during a Market
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Curtailment Period, (iv) during any Force Majeure Event, (v) due to Prudent Operating Practice or in compliance with applicable Law, or (vi) otherwise pursuant to the terms of this Agreement, the Interconnection Agreement or applicable tariff or as may be required under a Shared Facilities Agreement.
(f) Seller shall be permitted to reduce deliveries of Product as necessary to maintain health and safety pursuant to Section 6.2.
(g) Seller shall be permitted in its sole discretion to reduce Facility generation other than Buyer’s Share of such Facility generation during any Settlement Interval or Settlement Period that is not during a Curtailment Period or Market Curtailment Period. On and after the Initial Energy Delivery Date, during such curtailments, Seller shall deliver Facility Energy to Buyer in accordance with clause (b) of the definition of “Facility Energy”. (h) With respect to any (i) Major Planned Outage or (ii) Forced Facility Outage of MW or more of Installed Capacity that persists for more than one , Seller shall provide reports to Buyer not less frequently than each month regarding Seller’s progress toward completion of repairs, maintenance, equipment replacement and/or any other material aspect of returning the Facility to full operation, including information reasonably requested by Buyer.
Guaranteed Energy Production.
(a) On and after the Initial Energy Delivery Date, during each Performance Measurement Period, Seller shall deliver to Buyer an amount of Facility Energy, not including any Excess MWh, equal to no less than the Guaranteed Energy Production (as defined below). “Guaranteed Energy Production” means an amount of Facility Energy, as measured in MWh, equal to of the average annual Expected Energy for the two (2) Contract Years constituting such Performance Measurement Period. For purposes of determining whether Seller has achieved the Guaranteed Energy Production, in addition to Facility Energy, Seller shall be deemed to have delivered to Buyer the sum of (a) any Deemed Delivered Energy, plus (b) Facility Energy in the amount it could reasonably have delivered to Buyer but was prevented from delivering to Buyer by reason of any (i) Force Majeure Events, (ii) Curtailment Period (excluding any Transmission System Outage due to the fault or negligence of Seller), (iii) System Emergency not caused by Seller, or (iv) Buyer Default or other Buyer failure to perform that prevents Seller from being able to deliver Facility Energy to the Delivery Point (“Lost Output”). If Seller fails to achieve the Guaranteed Energy Production amount in any Performance Measurement Period on and after the Initial Energy Delivery Date, Seller shall pay Buyer damages calculated in accordance with Exhibit G (“Energy Replacement Damages”); provided, Seller may, as an alternative, provide Replacement Product delivered retrospectively to Buyer at the Delivery Point or the SP 15 EZ Gen Hub.
(b) Seller shall be permitted to deliver Replacement Product (i) prospectively during any Performance Measurement Period if Seller reasonably anticipates that delivery of such Replacement Product is necessary to achieve the Guaranteed Energy Production for such Performance Measurement Period, or (ii) retrospectively during the Contract Year immediately
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following any Performance Measurement Period in accordance with Section 4.7(a) above; provided, Seller’s right to deliver Replacement Product shall be subject to mutual agreement of the Parties (in the reasonable discretion of each) of the delivery schedule for such Replacement Product; provided further, the amount of Replacement Product delivered by Seller pursuant to (i) or (ii) shall not exceed ten percent (10%) of the Expected Energy for the Contract Year for which such Replacement Product is delivered. Seller shall provide Notice to Buyer of any proposed delivery of Replacement Product, including a proposed schedule of such deliveries, (i) no later than thirty (30) days prior to the proposed delivery of such Replacement Product in the case of prospectively delivered Replacement Product, and (ii) no later than thirty (30) days after the conclusion of any Performance Measurement Period with respect to which Seller proposes to deliver retroactive Replacement Product.
(a) WREGIS. On and after the Initial Energy Delivery Date, 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 Standard and transferred in a timely manner to Buyer for Buyer’s sole benefit. On and after the Initial Energy Delivery Date Seller shall transfer the Renewable Energy Credits to Buyer. On and after the Initial Energy Delivery Date 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 4.8(g), provided that Seller fulfills its obligations under Sections 4.8(a) through (g) below. In addition:
(a) Prior to the Initial Energy Delivery 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 Recurring 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 Recurring 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.
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(d) 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 4.8. 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 by, or is the result of any action or inaction of, Seller, then Seller shall either (x) resolve the associated WREGIS Certificate Deficit or (y) provide Replacement Green Attributes (as defined in Exhibit G) upon a schedule reasonably acceptable to Buyer (including in consideration of costs to Buyer), in each case no later than ninety (90) days following such Deficient Month; provided, Seller may offer to cure such WREGIS Certificate Deficit pursuant to clause (x) or (y) above after such ninety (90)-day period, which cure Buyer may accept or reject in its sole discretion; provided further, (1) if Buyer rejects Seller’s proffered cure following such ninety (90)-day period,
. If and to the extent Seller fails
to cure any WREGIS Certificate Deficit, as set forth in either clause (x) or (y) of the previous sentence, Buyer’s payment obligation for Facility Energy associated with the uncured WREGIS Certificate Deficit shall be reduced by
. Without limiting
Seller’s obligations under this Section 4.8, if a deficit or shortfall in WREGIS Certificates delivered to Buyer for a calendar month as compared to the Facility Energy for the same calendar month 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 WREGIS changes the WREGIS Operating Rules after the Effective Date or applies the WREGIS Operating Rules in a manner inconsistent with this Section 4.8 after the
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Effective Date, the Parties promptly shall modify this Section 4.8 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 and, if applicable, its successors, represents and warrants that throughout the Delivery Term of this Agreement the renewable energy credits transferred to Buyer conform to the definition and attributes required for compliance with the California Renewables Portfolio Standard, as set forth in California Public Utilities Commission Decision 08-08-028, and as may be modified by subsequent decision of the California Public Utilities Commission or by subsequent legislation. To the extent a change in law occurs after execution of this Agreement that causes this representation and warranty to be materially false or misleading, it shall not be an Event of Default if Seller has used commercially reasonable efforts to comply with such change in law. [STC REC-1]
(h) Seller warrants that all necessary steps to allow the Renewable Energy Credits transferred to Buyer to be tracked in the Western Renewable Energy Generation Information System will be taken prior to the first delivery under the contract. [STC REC-2] (i) Seller’s obligations under Sections 3.10, 4.8(g) and 4.8(h) shall be subject to Section 3.12, the term “Project” as used in Section 3.10 shall refer to the “Facility” as defined herein, the term “the contract” in Section 4.8(h) shall refer to “this Agreement” as defined herein, the term “commercially reasonable efforts” as used in Section 3.10 and Section 4.10(g) means efforts consistent with and subject to Section 3.12, and the Parties agree and acknowledge that no Energy, Green Attributes, or WREGIS Certificates shall be sold or delivered from Seller to Buyer prior to the Initial Energy Delivery Date.
ARTICLE 5
TAXES
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 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 to evidence such exemption or exclusion within thirty (30) days after the date Buyer makes such claim. Buyer shall indemnify, defend, and hold Seller harmless from any liability with respect to Taxes for which Buyer is responsible hereunder and from which Buyer claims it is exempt.
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
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long as no Party is materially adversely affected by such efforts. The Parties shall cooperate to minimize Tax exposure; provided, 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.
ARTICLE 6
MAINTENANCE OF THE FACILITY
Maintenance of the Facility. Seller shall, as between Seller and Buyer, be solely responsible for the operation and maintenance of the Facility and the delivery of the Product and shall comply with Law and Prudent Operating Practice relating to the operation and maintenance of the Facility and the generation and sale of Product.
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 Buyer’s emergency contact identified in Exhibit N Notice of such condition as soon as practicable thereafter. Such action may include disconnecting and removing all or a portion of the Facility, or suspending the supply of Facility Energy to the Delivery Point.
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 and/or co-tenancy agreements (“Shared Facilities Agreements”) to be entered into among two or more of Seller, the Participating Transmission Owner, Seller’s Affiliates, and/or third parties pursuant to which certain Interconnection Facilities, interconnection service and/or transmission service may be subject to joint ownership and/or shared maintenance and operation arrangements; provided, such agreements shall (i) not preclude Seller from performing or satisfying, and shall not purport to limit, its obligations hereunder, including providing interconnection capacity for the Facility in an amount not less than 901.28 MWat the Point of Interconnection and transmission capacity for delivery of energy from the Facility to the Delivery Point in an amount not less than 636 MW (provided, that Seller may share its interconnection capacity rights and transmission rights for the Facility with the South Affiliate , solely if and to the extent that, and solely for the period of time that, the amount of Energy that the Facility is capable of generating and delivering is less than 901.28 MW at the Point of Interconnection with respect to interconnection capacity, and 636 MW at the Delivery Point with respect to transmission capacity), (ii) provide for separate metering of the Facility, (iii) provide that any other generating or energy storage facilities not included in the Facility but using Shared Facilities shall not be included within the Facility’s CAISO Resource ID, and (iv) provide that any curtailment that is not specific to one or more CAISO Resource IDs of output from generating or energy storage facilities using the Shared Facilities shall not be allocated to the Facility more than its pro rata portion of the total capacity of all generating or energy storage facilities using the Shared Facilities, unless such curtailment of Shared Facilities was attributable to the Facility or caused by Seller. Seller shall not, and shall not permit any Affiliate to, allocate to other parties a share of the total
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interconnection capacity under the Interconnection Agreements in excess of an amount equal to the total interconnection capacity under the Interconnection Agreements minus 901.28 MW at the Point of Interconnection or a share of total transmission rights in excess of 636 MW at the Delivery Point MW (provided, Seller may share its interconnection capacity rights and/or transmission rights for the Facility with the South Affiliate , solely if and to the extent that, and solely for the period of time that, the amount of Energy that the Facility is capable of generating and delivering is less than 901.28 MW at the Point of Interconnection with respect to interconnection capacity rights and 636 MW at the Delivery Point with respect to transmission rights).
f
f
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ARTICLE 7
METERING
Metering. The Facility Meter shall be installed at the switching station adjacent to the SunZia East Converter Station and maintained at Seller’s cost. If the Facility Meter is inaccurate, Seller will cause such meter to be promptly corrected in accordance with Prudent Operating Practice and CAISO requirements, as applicable. Seller shall be responsible for any costs, fines or penalties, including imbalance charges as a result of the inaccurate meter. The Facility 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 that Seller breaks a seal, Seller shall notify Buyer as soon as practicable.
On and after the Initial Energy Delivery Date, Seller shall, or shall cause its Scheduling Coordinator to, provide Buyer with read-only access to a real-time data feed of the generation of the Facility, and real-time Facility Meter reads. In addition, on and after the Initial Energy Delivery Date, Seller hereby agrees to provide all Facility Meter data to Buyer in a form reasonably acceptable to Buyer on a read-only basis, and consents to Buyer obtaining from the CAISO or the PTO, as applicable, the Facility Meter data applicable to the Facility and all inspection, testing and calibration data and reports. On and after the Initial Energy Delivery Date, Seller, or Seller’s Scheduling Coordinator, shall cooperate with Buyer to provide records, including invoices or settlement data from the CAISO, for the full Facility, for Buyer to verify the accuracy of all invoices, and to allow both Parties to retrieve the Facility Meter reads from the CAISO Market Results Interface – Settlements (MRIS-S) (or its successor) or from the Facility Meter at the Facility.
ARTICLE 8Meter Verification. On and after the Initial Energy Delivery Date, annually, if ARTICLE 8Seller has reason to believe there may be a meter malfunction, or upon Buyer’s ARTICLE 8reasonable request, Seller shall test the Facility Meter. The tests shall be conducted ARTICLE 8by independent third parties qualified to conduct such tests. Buyer shall be notified ARTICLE 8seven (7) days in advance of such tests and have a right to be present during such ARTICLE 8tests. If a meter is inaccurate it shall be promptly repaired or replaced. If a meter is ARTICLE 8inaccurate by more than one percent (1%) and it is not known when the meter ARTICLE 8inaccuracy commenced (if such evidence exists, such date will be used to adjust ARTICLE 8prior invoices), then the invoices covering the period of time since the last meter ARTICLE 8test shall be adjusted for the amount of the inaccuracy on the assumption that the ARTICLE 8inaccuracy persisted during the second half of such period so long as such ARTICLE 8adjustments are accepted by CAISO and WREGIS; provided, such period may not
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ARTICLE 8exceed twelve (12) months.
INVOICING AND PAYMENT; CREDIT
Invoicing. Seller shall use commercially reasonable efforts to deliver an invoice to Buyer for Product no later than the fifteen (15th) day of each month for the previous calendar month. Each invoice shall (a) state the Contract Rate applicable to such Product in accordance with Exhibit C, reflect records of metered data, including CAISO metering and transaction data sufficient to document and verify the amount of Product delivered by the Facility for any Settlement Period during the preceding month, including (on and after the Initial Energy Delivery Date) the amount of Facility Energy and Replacement Product delivered to Buyer (if any), the calculation of Deemed Delivered Energy and Adjusted Energy Production (if any), the LMP prices at the Delivery Point for each Settlement Period, and shall include other relevant data for the prior month; and (b) be in a format reasonably acceptable to Buyer, covering the Product provided in the preceding month determined in accordance with the applicable provisions of this Agreement. Seller shall provide Buyer with all reasonable access (including, in real time, to the maximum extent reasonably possible) to any records, including invoices or settlement data from the CAISO, forecast data and other information, all as may be necessary from time to time for Buyer to verify the accuracy of all invoices.
Payment. Buyer shall make payment to Seller for Product (and any other amounts due) by wire transfer or ACH payment to the bank account provided on each monthly invoice. Buyer shall pay undisputed invoice amounts no later than thirty (30) days after Buyer’s receipt of the invoice from Seller; provided, if such due date falls on a weekend or legal holiday, such due date shall be the next Business Day. Payments made after the due date will be considered late and will bear interest on the unpaid balance. If the amount due is not paid on or before the due date or if any other payment that is due and owing from one Party to another is not paid on or before its applicable due date, a late payment charge shall be applied to the unpaid balance and shall be added to the next billing statement. Such late payment charge shall be calculated based on an annual Interest Rate equal to the prime rate published on the date of the invoice in The Wall Street Journal (or, if The Wall Street Journal is not published on that day, the next succeeding date of publication), plus two percent (2%) (the “Interest Rate”). If the due date occurs on a day that is not a Business Day, the late payment charge shall begin to accrue on the next succeeding Business Day.
Books and Records. To facilitate payment and verification, each Party shall maintain all books and records necessary for billing and payments, including copies of all invoices under this Agreement, for a period of at least two (2) years or as otherwise required by Law. Upon fifteen (15) days’ Notice to the other Party, either Party shall be granted reasonable access to the accounting books and records within the possession or control of the other Party pertaining to all invoices generated pursuant to this Agreement. Seller acknowledges that in accordance with California Government Code Section 8546.7, Seller may be subject to audit by the California State Auditor with regard to Seller’s performance of this Agreement, for a period of three (3) years following the last payment hereunder (or such longer period required by applicable Law), because the compensation under this Agreement exceeds $10,000.
Payment Adjustments; Billing Errors. Payment adjustments shall be made if Buyer or Seller discovers there have been good faith inaccuracies in invoicing that are not otherwise disputed
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under Section 8.5 or an adjustment to an amount previously invoiced or paid is required due to a correction of data by the CAISO, or there is determined to have been a meter inaccuracy sufficient to require a payment adjustment. If the required adjustment is in favor of Buyer, Buyer’s next monthly payment shall be credited in an amount equal to the adjustment. If the required adjustment is in favor of Seller, Seller shall add the adjustment amount to Buyer’s next monthly invoice.
Adjustments in favor of either Buyer or Seller shall bear interest, until settled in full, in accordance with Section 8.2, accruing from the date on which the adjusted amount should have been due.
Billing Disputes. A Party may, in good faith, dispute the correctness of any invoice or any adjustment to an invoice rendered under this Agreement or adjust any invoice for any arithmetic or computational error within twelve (12) months of the date the invoice, or adjustment to an invoice, was rendered. In the event an invoice or portion thereof, or any other claim or adjustment arising hereunder, is disputed, payment of the undisputed portion of the invoice shall be required to be made when due. Any invoice dispute or invoice adjustment shall be in writing and shall state the basis for the dispute or adjustment. Payment of the disputed amount shall not be required until the dispute is resolved. Upon resolution of the dispute, any required payment shall be made within five (5) Business Days of such resolution along with interest accrued at the Interest Rate from and including the original due date to but excluding the date paid. Inadvertent overpayments shall be returned via adjustments in accordance with Section 8.4. Any dispute with respect to an invoice is waived if the other Party is not notified in accordance with this Section 8.5 within twelve (12) months after the invoice is rendered or subsequently adjusted, except to the extent any misinformation was from a third party not affiliated with any Party and such third party corrects its information after the twelve-month period. If an invoice is not rendered within twelve (12) months after the close of the month during which performance occurred, the right to payment for such performance is waived.
Netting of Payments. The Parties hereby agree that they shall discharge mutual debts and payment obligations due and owing to each other on the same date through netting, in which case all undisputed amounts owed by each Party to the other Party for the purchase and sale of Product during the monthly billing period under this Agreement or otherwise arising out of this Agreement, including any related damages calculated pursuant to Exhibits B and G, interest, and payments or credits, shall be netted so that only the excess amount remaining due shall be paid by the Party who owes it.
Seller’s Development Security. To secure its obligations under this Agreement, Seller shall have delivered the Development Security to Buyer on or before the Effective Date. Seller shall maintain the Development Security in full force and effect; provided, Seller shall have no obligation to replenish the Development Security following any draw thereupon by Buyer; provided further, Buyer shall not draw on the Development Security with respect to any payments due from and payable by Seller until after any required Notice and the expiration of all cure periods. Upon the earlier of (a) Seller’s delivery of the Performance Security, or (b) sixty (60) days after termination of this Agreement, Buyer shall return the Development Security to Seller, less the amounts drawn in accordance with this Agreement. If the Development Security is provided in the form of more than one Letter of Credit, any draw on the Development Security by Buyer shall be made pro rata among each such Letter of Credit.
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Seller’s Performance Security. To secure its obligations under this Agreement, Seller shall deliver Performance Security to Buyer on or before the Commercial Operation Date. Seller shall maintain the Performance Security in full force and effect, and Seller shall within ten (10) Business Days after any draw thereon replenish the Performance Security in the event Buyer collects or draws down any portion of the Performance Security for any reason permitted under this Agreement other than to satisfy a Termination Payment, until the following have occurred: (a) the Delivery Term has expired or terminated early; and (b) all payment obligations of Seller due and payable under this Agreement, including compensation for penalties, Termination Payment, indemnification payments or other damages are paid in full (whether directly or indirectly such as through set-off or netting); provided, Buyer shall not draw on the Performance Security with respect to any payments due from and payable by Seller until after any required Notice and the expiration of all cure periods. Following the occurrence of both events listed in clauses (a) and (b) above, Buyer shall promptly return to Seller the unused portion of the Performance Security. If the Performance Security is provided in the form of more than one Letter of Credit, any draw on the Performance Security by Buyer shall be made pro rata among each such Letter of Credit.
First Priority Security Interest in Cash or Cash Equivalent Collateral. To secure its obligations under this Agreement, and until released as provided herein, Seller hereby grants to Buyer a present and continuing first-priority security interest (“Security Interest”) in, and lien on (and right to net against), and assignment of the Development Security and Performance Security, to the extent the Development Security and/or Performance Security are provided in the form of cash collateral or cash equivalent collateral, any other cash collateral and cash equivalent collateral posted pursuant to Sections 8.7 and 8.8 and any and all interest thereon or proceeds resulting therefrom or from the liquidation thereof, whether now or hereafter held by, on behalf of, or for the benefit of Buyer, and Seller agrees to take all action as Buyer reasonably requires in order to perfect Buyer’s Security Interest in, and lien on (and right to net against), such collateral and any and all proceeds resulting therefrom or from the liquidation thereof.
Upon or any time after the occurrence of an Event of Default caused by Seller, an Early Termination Date resulting from an Event of Default caused by Seller, or an occasion provided for in this Agreement where Buyer is authorized to retain all or a portion of the Development Security or Performance Security, Buyer may do any one or more of the following (in each case subject to the final sentence of this Section 8.9):
(a) Exercise any of its rights and remedies with respect to the Development Security and Performance Security, including any such rights and remedies under Law then in effect;
(b) Draw on any outstanding Letter(s) of Credit issued for its benefit and retain any cash held by Buyer as Development Security or Performance Security; and (c) Liquidate all Development Security or Performance Security (as applicable) then held by or for the benefit of Buyer free from any claim or right of any nature whatsoever of Seller, including any equity or right of purchase or redemption by Seller.
Buyer shall apply the proceeds of the collateral realized upon the exercise of any such rights or
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remedies to reduce Seller’s obligations under this Agreement (Seller remains liable for any amounts owing to Buyer after such application), subject to Buyer’s obligation to return any surplus proceeds remaining after such obligations are satisfied in full.
8.10 Financial Statements.
(a) If a Guaranty is provided as Performance Security in lieu of cash or a Letter of Credit, Seller shall provide to Buyer, or cause the Guarantor to provide to Buyer, unaudited quarterly and annual audited financial statements of the Guarantor (including a balance sheet and statements of income and cash flows), all prepared in accordance with generally accepted accounting principles in the United States, consistently applied. (b) Buyer shall provide to Seller (i) within one hundred twenty (120) days following the end of each fiscal year during the Contract Term, a copy of Buyer’s annual report containing audited consolidated financial statements for such fiscal year and (ii) within sixty (60) days after the end of each of its first three fiscal quarters of each fiscal year during the Contract Term, a copy of Buyer’s quarterly report containing unaudited consolidated financial statements for such fiscal quarter. In all cases the statements shall be for the most recent accounting period and prepared in accordance with generally accepted accounting principles (“GAAP”); provided, should any such statements not be available on a timely basis due to a delay in preparation or certifications, such unavailability shall not be an Event of Default so long as Buyer diligently pursues the preparation, certification, and delivery of the statements. Buyer shall be deemed to have delivered such financial statements to Seller if such statements are made publicly available.
ARTICLE 9
NOTICES
Addresses for the Delivery of Notices. Any Notice required, permitted, or contemplated hereunder shall be in writing, shall be addressed to the Party to be notified at the address set forth in Exhibit N or at such other address or addresses as a Party may designate for itself from time to time by Notice hereunder.
Acceptable Means of Delivering Notice. Each Notice required, permitted, or contemplated hereunder shall be deemed to have been validly served, given or delivered as follows: (a) if sent by United States mail with proper first class postage prepaid, three (3) Business Days following the date of the postmark on the envelope in which such Notice was deposited in the United States mail; (b) if sent by a regularly scheduled overnight delivery carrier with delivery fees either prepaid or an arrangement with such carrier made for the payment of such fees, the next Business Day after the same is delivered by the sending Party to such carrier; (c) if sent by electronic communication (including electronic mail or other electronic means) at the time indicated by the time stamp upon delivery and, if after 5 pm, on the next Business Day; or (d) if delivered in person, upon receipt by the receiving Party. Notwithstanding the foregoing, Notices of outages or other scheduling or dispatch information or requests, may be sent by electronic communication and shall be considered delivered upon successful completion of such transmission.
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ARTICLE 10
FORCE MAJEURE
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 commercially reasonable efforts, cannot be avoided by and is beyond the reasonable control (whether direct or indirect) of the claiming Party; provided, a Force Majeure Event shall not excuse any such delay, nonperformance, or noncompliance to the extent the claiming Party’s fault or negligence contributed thereto in scope or duration. (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 or pandemic (including the COVID-19 pandemic, but only to the extent that new governmental rules or mandates related to COVID-19 are implemented that were not in place as of the Effective Date); 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 or changes in Law that render a Party’s performance of this Agreement at the Contract Rate unprofitable or otherwise uneconomic (including an increase in component or compliance costs for any reason, including foreign or domestic tariffs, Buyer’s ability to buy Product 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, except to the extent that a Curtailment Order is caused by an event that otherwise qualifies as a Force Majeure Event; (v) Seller’s inability to obtain sufficient labor, equipment, materials, or other resources to build or operate the Facility, including the lack of wind, sun or other fuel source of an inherently intermittent nature, except to the extent such inability is caused by a Force Majeure Event; (vi) a strike, work stoppage or labor dispute limited only to any one or more of Seller, Seller’s Affiliates, Seller’s contractors, their subcontractors thereof or any other third party employed by Seller to work on the Facility; (vii) any equipment failure except if such equipment failure is caused by a Force Majeure Event; or (viii) any action or inaction by any third party, including Transmission Provider, that delays or prevents the approval, construction or placement in service of any Interconnection Facilities or Network Upgrades, except to the extent caused by a Force Majeure Event.
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No Liability If a Force Majeure Event Occurs. Except as provided in Section 4 of Exhibit B, 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 with due speed and diligence. Nothing herein shall be construed as permitting that Party to continue to fail to perform after said cause has been removed.
The obligation to use due speed and diligence shall not be interpreted to require resolution of labor disputes by acceding to demands of the opposition when such course is inadvisable in the discretion of the Party having such difficulty. Neither Party shall be considered in breach or default 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.
Notice. In order to claim a Force Majeure Event, the claiming Party, within fourteen (14) days of becoming aware that an event or series of events, as applicable, constitutes a Force Majeure Event, must give the other Party Notice describing the particulars of the occurrence in substantially the form set forth in Exhibit T, (b) provide timely evidence reasonably sufficient to establish that the occurrence constitutes Force Majeure as defined in this Agreement, and (c) 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. Failure to provide timely Notice shall not affect such Party’s ability to assert that a Force Majeure Event has occurred but shall preclude such Party from claiming a Force Majeure Event (including any Development Cure Period delays) or being excused from any delay or nonperformance associated therewith with respect to the days prior to the date on Notice was actually given.
Termination Following Force Majeure Event or Development Cure Period. (a) If the cumulative extensions granted under the Development Cure Period (other than the extensions granted pursuant to clause 4(d) in Exhibit B) plus the payment of Commercial Operation Delay Damages equal or exceed , and Seller has demonstrated to Buyer’s reasonable satisfaction that Seller’s failure to achieve COD by the Guaranteed Commercial Operation Date (as extended) was the result of delays that would have otherwise entitled to Seller to of Development Cure Period delays but for the one hundred eighty (180)-day limitation, then Seller may terminate this Agreement upon Notice to Buyer. Upon 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 then held by Buyer plus the full amount of Commercial Operation Delay Damages paid by Seller, less any amounts drawn in accordance with this Agreement with respect to other amounts due from Seller, if any. (b) If a Force Majeure Event has occurred after the Commercial Operation Date that has caused either Party to be wholly or partially unable to perform its obligations hereunder in any material respect, 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 Notice to the other Party; provided, if Seller is the Party claiming
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such Force Majeure Event and such Force Majeure Event cannot reasonably be cured within such twelve (12) month period, then Seller may provide a plan to Buyer, which must be acceptable to Buyer in its reasonable discretion, to cure such Force Majeure Event within an additional six (6) month period and Buyer may not terminate this Agreement due to such Force Majeure Event unless Seller has not resumed performance of its material obligations hereunder upon the expiration of such additional six (6)-month period; provided further, if the impacted Party has claimed and received relief from performance of its obligations due to such Force Majeure Event for a consecutive eighteen (18)-month period, then either Party may terminate this Agreement upon Notice to the other Party. 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 Performance Security then held by Buyer, less any amounts drawn in accordance with this Agreement.
ARTICLE 11
DEFAULTS; REMEDIES; TERMINATION
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;
(ii) any representation or warranty made by such Party herein is false or misleading in any material respect when made or when deemed made or repeated, and such default is not remedied within thirty (30) days after Notice thereof (or such longer additional period, not to exceed an additional sixty (60) days, if the Defaulting Party is unable to remedy such default within such initial thirty (30)-day period despite exercising commercially reasonable efforts); (iii) the failure by such Party to perform any material covenant or obligation set forth in this Agreement (except to the extent constituting a separate Event of Default set forth in this Section 11.1 or for which an exclusive remedy is provided), and such failure is not remedied within thirty (30) days after Notice thereof (or such longer additional period, not to exceed an additional sixty (60) days, if the Defaulting Party is unable to remedy such default within such initial thirty (30)-day period despite exercising commercially reasonable efforts); (iv) such Party becomes Bankrupt;
(v) such Party assigns this Agreement or any of its rights hereunder other than in compliance with Article 14, if applicable; (vi) such Party consolidates or amalgamates with, or merges with or into, or transfers all or substantially all of its assets to, another entity and, at the time of such consolidation, amalgamation, merger or transfer, the resulting, surviving or transferee entity fails to assume all the obligations of such Party under this Agreement to which it or its predecessor was
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a party by operation of Law or pursuant to an agreement reasonably satisfactory to the other Party; or
(vii) failure by either Party to satisfy the collateral requirements pursuant to Sections 8.7 or 8.8 (except, with respect to Seller, as set forth in Sections 11.1(b)(vi) and
11.1(b)(vii)) within five (5) Business Days after Notice from the other Party, including Seller’s failure to replenish the Performance Security amount in accordance with this Agreement in the event Buyer draws against it for any reason other than to satisfy a Termination Payment; (b) with respect to Seller as the Defaulting Party, the occurrence of any of the following:
(i) if at any time Seller delivers or attempts to deliver Energy to the Delivery Point for sale under this Agreement that was not generated or discharged by the Facility, except for Replacement Product;
(ii) the failure by Seller to achieve Commercial Operation on or before the Guaranteed Commercial Operation Date, as such date may be extended by Seller’s payment of Commercial Operation Delay Damages and/or by Development Cure Period extensions, or the failure by Seller to begin selling Facility Energy and associated Green Attributes to Buyer on or before the Initial Energy Delivery Date;
(iii) if, in any consecutive six (6) month period after the Initial Energy Delivery Date, the Adjusted Energy Production amount (calculated in accordance with Exhibit G) for such period is not at least ten percent (10%) of the 6-month pro rata amount of Expected Energy for such period adjusted for seasonality proportionately to the monthly forecast provided annually by Seller under Section 4.3(a), and Seller fails to (x) deliver to Buyer within ten (10) Business Days after Notice from Buyer a plan or report developed by Seller that describes the cause of the failure to meet the ten percent (10%) threshold and the actions that Seller has taken, is taking, or proposes to take in an effort to cure such condition along with the written confirmation of a Licensed Professional Engineer that such plan or report is in accordance with Prudent Operating Practices and capable of cure within a reasonable period of time, not to exceed one hundred eighty (180) days, or such longer period if necessary to remedy a Major Equipment Failure, not to exceed a total of eighteen (18) months (“Cure Plan”) and (y) complete such Cure Plan in all material respects as set forth therein, including within the timeframe set forth therein; (iv) if at any time during the Delivery Term the Installed Capacity does not equal or exceed the Guaranteed Installed Capacity;
(v) Reserved;
(vi) with respect to any outstanding Letter of Credit provided for the benefit of Buyer that is not then required under this Agreement to be canceled or returned, the failure by Seller to provide for the benefit of Buyer either (1) cash, (2) a Letter of Credit from a different issuer meeting the criteria set forth in the definition of Letter of Credit, or (3) a replacement Guaranty from a Guarantor meeting the criteria set forth in the definition of
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Guarantor, 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 A- by S&P or A3 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;
(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;
(vii) with respect to any Guaranty provided for the benefit of Buyer, the failure by Seller to provide for the benefit of Buyer either (1) cash, (2) a replacement Guaranty from a different Guarantor meeting the criteria set forth in the definition of Guarantor, or (3) a replacement Letter of Credit from an 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) if any representation or warranty made by the Guarantor in connection with this Agreement is false or misleading in any material respect when made or when deemed made or repeated, and such representation or warranty is not remedied within thirty (30) days after Notice thereof;
(B) the failure of the Guarantor to make any payment required or to perform any other material covenant or obligation in any Guaranty; (C) the Guarantor becomes Bankrupt;
(D) the Guarantor shall fail to meet the criteria for an acceptable Guarantor as set forth in the definition of Guarantor;
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(E) the failure of the Guaranty to be in full force and effect (other than in accordance with its terms) prior to the indefeasible satisfaction of all obligations of Seller hereunder; or
(F) the Guarantor shall repudiate, disaffirm, disclaim, or reject, in whole or in part, or challenge the validity of any Guaranty.
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, or (ii) the Termination Payment, as applicable, in each case calculated in accordance with Section 11.3 below; (c) to withhold any payments due to the Defaulting Party under this Agreement; (d) to suspend performance; and
(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, 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 any Terminated Transaction and the Event of Default related thereto.
Damage Payment; Termination Payment. If an Early Termination Date has been declared, the Non-Defaulting Party shall calculate, in a commercially reasonable manner, the Damage Payment or Termination Payment, as applicable, in accordance with this Section 11.3. (a) Damage Payment Prior to Commercial Operation Date. If the Early Termination Date occurs before the Commercial Operation Date, then the Damage Payment shall be calculated in accordance with this Section 11.3(a).
(i) If Seller is the Defaulting Party, then the Damage Payment shall be owed to Buyer and shall be a dollar amount that equals the amount of the Development Security as set forth on the Cover Sheet plus, if the Development Security is posted as cash, any interest accrued thereon. Buyer shall be entitled to immediately retain for its own benefit those funds held as Development Security and any interest accrued thereon if the Development Security is posted as cash, and any amount of Development Security that Seller has not yet posted with Buyer shall be immediately due and payable by Seller to Buyer. There will be no amounts owed to Seller. The
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Parties agree that Buyer’s damages in the event of an Early Termination Date prior to the Commercial Operation Date caused by Seller’s default would be difficult or impossible to determine and that the damages set forth in this Section 11.3(a)(i) are a reasonable approximation of Buyer’s harm or loss.
(ii) Except as set forth in Section 11.3(a)(iii), if Buyer is the Defaulting Party, then the Damage Payment shall be owed to Seller and shall equal Buyer’s Share of the sum of the actual, documented and verifiable costs incurred by Seller between the Effective Date and the Early Termination Date in connection with the Facility, less the fair market value (determined in a commercially reasonable manner) of (A) all Seller’s assets individually or (B) the entire Facility, whichever is greater on the Early Termination Date, regardless of whether or not any Seller asset or the entire Facility is actually sold or disposed of. (iii) If Buyer is the Defaulting Party and such default arises in connection with: (A) Buyer’s repudiation of this Agreement; (B) Buyer’s bad faith; (C) Buyer’s failure to comply with its obligations under Section 2.2(a) to, within five (5) Business Days after receipt thereof, either accept or provide Notice stating in reasonable detail the basis for its reasonable rejection of Seller’s evidence of completion of any condition to Commercial Operation set forth in Section 2.2(a) (provided that Seller submitted such evidence within thirty (30) days of the expected Commercial Operation Date); or (D) Buyer’s failure to comply with its obligations under Section 2.6 to (x) within ten (10) Business Days of its receipt of Seller’s Notice of a Project Bifurcation or Project Transition, provide Notice to Seller of any comments on the draft Replacement PPA(s) and termination agreement attached to such Notice, and (y) cooperate reasonably with Seller and the Owners to resolve any issues and enter into the Replacement PPA(s) and the termination agreement within thirty (30) days of Seller’s Notice to Buyer of the same (provided, this clause (D) shall apply only if the draft Replacement PPA(s) are on the same terms and conditions as those set forth in this Agreement, except for those administrative changes that are necessary to effectuate the separation or transition of this Agreement into Replacement PPA(s) (including such changes as are set forth in Section 2.6(a) through Section 2.6(g), as applicable)), then the Damage Payment shall be owed to Seller and shall be equal to the Termination Payment determined in accordance with Section 11.3(b) below as of the Early Termination Date. There will be no amount owed to Buyer. The Parties agree that Seller’s damages in the event of an Early Termination Date prior to the Commercial Operation Date caused by Buyer’s default would be difficult or impossible to determine and that the damages set forth in Section 11.3(a)(ii) above or this Section 11.3(a)(iii), as applicable, are a reasonable approximation of Seller’s harm or loss. (b) Termination Payment On or After the Commercial Operation Date. The payment owed by the Defaulting Party to the Non-Defaulting Party for a Terminated Transaction occurring after the Commercial Operation Date (“Termination Payment”) shall be the aggregate of all Settlement Amounts plus any and 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
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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 (i) the actual damages that the Non-Defaulting Party would incur in connection with a Terminated Transaction would be difficult or impossible to predict with certainty, (ii) the Termination Payment described in this Section