Board of Directors of the
Clean Power Alliance of Southern California
Regular Meeting
Thursday, December 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
Signia by Hilton San Jose
170 S. Market Street
San Jose, CA 95113
City of West Hollywood
3rd Floor Conference Room
8300 Santa Monica Boulevard
West Hollywood, CA 90069
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.
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 Agenda Page 1
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 November 6, 2025, Board of Directors Meeting
2. Appoint One New Member to the Community Advisory Committee in the San Gabriel Valley Region for the Remainder of the Term Expiring April 2026
3. Approve CPA’s 2026 Legislative & Regulatory Policy Platform as Recommended by the Legislative & Regulatory Committee
4. Adopt Resolution No. 25-12-097 to Approve Fiscal Year 2025-26 Rates for Phase 7 Subset Customers Under Rate Schedules TOU-8, TOU-GS-3, and TOU-PA Effective January 1, 2026
5. Approve Six Innovation Fund Round 2 Recipients and Authorize the Chief Executive Officer to Execute Participation Agreements with Each of the Selected Member Agencies Listed Below to Implement the Proposed Innovation Fund Projects for Total Funding in the Amount of $1,250,000:
i. Alhambra (in the amount of $168,450)
ii. Carson (in the amount of $163,100)
iii. Los Angeles County (in the amount of $250,000)
iv. Thousand Oaks (in the amount of $168,450)
v. Ventura County (in the amount of $250,000); and,
vi. Whittier (in the amount of $250,000)
6. Approve Amendment to CEO’s Employment Agreement Extending the Term to December 31, 2029, and Modifying the CEO’s Retention Incentive Payment Methodology in Order to Create an Incentive for the CEO to Complete the Full Term of the Extension and Authorize the Chair of the Board of Directors to Execute the Amendment to the CEO’s Employment Agreement on CPA’s Behalf
7. Receive and File 2026 Board of Directors and Standing Committee Meeting Schedule
Agenda Page 2
8. Receive and File FY 2025/26 Q1 Financial Report
9. Receive and File CY Q3 Risk Management Team Report
10.Receive and File CY Q4 Member Agency Programs Report
11.Receive and File CY Q3/Q4 Communications Update
12.Receive and File Monthly Community Advisory Committee Report
PUBLIC HEARING
13.Conduct a Public Hearing to Consider Adoption of Resolution No. 25-12-098 to Approve Addendum No. 6 Adding the Cities of Cudahy and Fillmore as Members of Clean Power Alliance and to Authorize Staff to Submit Addendum No. 6 as Attached, or in a Substantially Similar Form, to the California Public Utilities Commission on or Before December 31, 2025
REGULAR AGENDA
Action Items
14.Approve and Authorize the Chief Executive Officer to Execute the Following Long-Term Renewable Power Purchase Agreements for Local Resources to Serve the Power Share Program:
A. 20-Year 4 MW PPA with Saticoy Sun Farms, LLC for the 4 MW Saticoy Project B. 20-Year 2.46 MW PPA with Fillmore Sun Farms, LLC for the 2.46 MW Fillmore Project
C. 20-Year 4.99 MW PPA with BMT Elkhorn, LLC for the 4.99 MW Elkhorn Project D. 20-Year 3W MW PPA with RPCA Solar 17, LLC for the 3 MW Road 232 Project
15.Adopt an Interim Rate Adjustment Approach Effective February 1, 2026, for all CPA Customers in Phase 1 Through 6 Communities that Meets CPA’s Projected FY 2025-2026 Cost of Service and Results in a Targeted FY 2025-2026 Contribution to Net Position of $15M with Estimated Total Bill Comparisons for Residential and Small/Medium Business as Specified in Slide 7
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 JANUARY 15, 2026
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 November 6, 2025 Board of Directors Meeting
Date: December 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, November 6, 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
South Bay Cities Council of Governments
Conference Room
357 Van Ness Way, Suite 90
Torrance, CA 90501
Ventura County Government Center
Point Mugu Conference Room, 4th Floor
Hall of Administration
800 South Victoria Avenue
Ventura, CA 93009
Crowne Plaza Santo Domingo
Av. George Washington 218
Santo Domingo 10208, DO
Whittier City Hall
Admin Conference Room
13230 Penn Street
Whittier, CA 90602
CALL TO ORDER & ROLL CALL
Chair Klein Lopez called the meeting to order at 2:03 p.m. and Gabriela Monzon, Clerk of the Board, conducted roll call.
PLEDGE OF ALLEGIANCE
Guest Presenter, Chief Richard Stillwagon of the Los Angeles County Fire Department, led the Pledge of Allegiance.
Roll Call
1 Agoura Hills Deborah Klein Lopez Chair Present
2 Alhambra Jeff Maloney Director Present
3 Arcadia Paul Cheng Director Remote
4 Beverly Hills Craig Corman Director Present
5 Calabasas Ed Albrecht Director Remote
6 Camarillo Susan Santangelo Director Remote
7 Carson Absent
8 Claremont Corey Calaycay Director Present
9 Culver City Yasmine-Imani McMorrin Director Present
Agenda Page 7
Board of Directors Item 1
10 Downey Absent
11 Hawaiian Gardens Ramie Torres Alternate Remote
12 Hawthorne Alex Monteiro Director Remote
13 Hermosa Beach Absent
14 La Cañada Flintridge Stephanie Fossan Director Present 15 Los Angeles County Lindsey Horvath Vice Chair Present 16 Lynwood Juan Muñoz-Guevara Director Present
17 Malibu Marianne Riggins Director Present
18 Manhattan Beach David Lesser Director Remote
19 Monrovia Edward Belden Director Remote
20 Moorpark Chris Barrett Director Remote
21 Ojai Michelle Ellison Alternate Remote
22 Oxnard Kathleen Mallory Alternate Remote
23 Paramount Michelle Muller Alternate Remote
24 Port Hueneme Absent
25 Redondo Beach Absent
26 Rolling Hills Estates Debby Stegura Director Remote
27 Santa Monica Absent
28 Santa Paula Jenny Crosswhite Director Present
29 Sierra Madre Robert Parkhurst Director Present
30 Simi Valley Rocky Rhodes Director Present
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 Present
36 West Hollywood John Erickson Director Present
37 Westlake Village Kristopher Galvez Alternate Remote
38 Whittier Mary Ann Pacheco Director Remote
All votes are unanimous unless otherwise stated
Agenda Page 8
Board of Directors Item 1
GENERAL PUBLIC COMMENT
Calvin Johnson provided public comment on a device his company offers that can make an HVAC system more efficient.
CONSENT AGENDA
1. Approve Minutes from the September 26, 2025, Board of Directors Special Meeting
2. Approve Minutes from the October 16, 2025, Board of Directors Meeting
3. Approve and Authorize: (A) the Chief Executive Officer to Execute the Capacity Bidding Program-Elect (CBP-E) Aggregator Agreement and Credit Application with Southern California Edison; and (B) CPA Staff to Perform Related and Necessary Actions to Serve as a CBP-E Aggregator
4. Receive and File Monthly Community Advisory Committee Report Motion: Director Erickson, West Hollywood
Second: Vice Chair Horvath, Los Angeles County
Vote: The consent agenda was approved by roll call vote, with the following abstentions: Director Corman on Items 1 and 2, Director Riggins on Item 1, and Director Mallory on Items 1 and 2.
REGULAR AGENDA
5. Receive Presentation on Battery Energy Storage Safety Scott Murtishaw, Executive Director of the California Energy Storage Association, delivered a presentation that focused on energy storage deployment and design, beneficial impacts to the grid, chemical exposure impacts of energy storage incidents, legislative efforts to enhance energy storage safety, statewide regulatory activity, and the development of local ordinances.
Chief Richard Stillwagon of the Los Angeles County Fire Department presented on the agency’s work in reducing fire risk in clean energy production. Chief Stillwagon emphasized that the department is committed to developing streamlined and efficient processes, maintaining the highest safety standards, and safely serving the community and industry for years to come.
Directors asked a series of questions about battery technologies, fire risks, and safety measures.
Staff noted that CPA is monitoring new regulations to guide developers as projects move into permitting. Chief Stillwagon emphasized that national and local fire regulations are robust, LA County Fire has the knowledge and resources necessary to properly review and permit projects, and member agencies could safely pursue battery storage projects that benefit their communities.
Vice Chair Horvath encouraged CPA member agencies to use L.A. County’s fire risk-reduction resources.
A written public comment was received on this item.
6. Adopt Resolutions Nos. 25-11-093, 25-11-094, 25-11-095, and 25-11-096 Approving Parameters Under Which up to a Total of $4.5 Billion of Energy Prepayment Transactions can be Completed with Goldman Sachs (GS),
Agenda Page 9
Board of Directors Item 1
JPMorgan (JPM), Morgan Stanley (MS), or Royal Bank of Canada (RBC) as CPA’s Underwriter & Prepaid Supplier; Authorizing and/or Approving Documents or “Form of” Documents Supporting the Prepay Transactions; and Directing California Community Choice Financing Authority to Make Payments to Service Providers for Issuance Costs from Prepay Bond Proceeds. The authorizations in each of the Resolutions shall terminate on June 30, 2027; and, (B) Delegate Authority to the Chief Executive Officer to Select the Funding Recipient(s) for Prepay Transactions Completed with GS, JPM, or MS David McNeil, Chief Financial Officer, provided an overview of prepay transactions.
CPA completed five transactions in 2023 and 2024, issuing $5.9 billion of prepay bonds leading to approximately $361 million of energy cost savings over the next eight years, an average annual savings of $45 million. On October 23, 2025, the Executive Committee provided input and support for CPA’s contracting approach for future prepays. On October 29, 2025, the Finance Committee recommended that the Board authorize staff to execute up to $4.5 billion of prepay transactions and delegate authority to staff to select a funding recipient. Mr. McNeil presented portfolio planning considerations and the process for selecting Underwriters and Prepaid Suppliers. The participating banks are qualified and experienced providers capable of structuring and executing prepay transactions for CPA.
Staff clarified for Director Rhodes that CPA is not required to complete the transactions if market conditions are unfavorable within the 18-month window to issue bonds. Director Lesser inquired whether member agencies would assume any liability for the transactions, and staff responded that there is no liability for member agencies and that the joint powers agreement specifies that any of CPA’s liability is to remain with CPA.
Motion: Vice Chair Horvath, Los Angeles County
Second: Director Parkhurst, Sierra Madre
Vote: Item 6 was approved by a roll call vote.
7. Receive Presentation of CPA’s Audited Financial Results for Fiscal Year 2024- 2025 and Fiscal Year 2024-2025 Budget to Actual Report
Mr. McNeil reported that CPA received a clean audit opinion of its Fiscal Year 2024-2025 financial results from Baker Tilly. CPA increased its net position and liquidity by $137 million and $107 million, respectively. Days Liquidity on Hand (DLOH) and the Reserve Percentage increased to 180 days and 45%, respectively. Results were affected by lower retail rates, milder weather, and lower energy prices. Increased investments and favorable interest rates boosted interest income. Mr. McNeil noted seven consecutive clean audits.
The Board had no questions or comments on this item.
8. Receive Presentation on 2026 Power Charge Indifference Adjustment and Rates Outlook
Ted Bardacke, Chief Executive Officer, summarized how SCE rates impact CPA rates, with a focus on the Power Charge Indifference Adjustment (PCIA) fee. On October 1, 2025, SCE implemented a generation rate increase. While this increase did not directly impact CPA customers, it significantly improved CPA’s competitive position. Concurrently, SCE implemented a delivery rate increase, which impacted all customers, including CPA customers. In October, SCE also filed its Energy
Agenda Page 10
Board of Directors Item 1
Resource Recovery Account (ERRA) Update with the CPUC. The ERRA proceeding will determine PCIA rates for CPA customers and generation rates for SCE generation customers starting January 2026. SCE’s proposal would increase PCIA rates and total bills for all CPA customers and reduce SCE generation rates, significantly worsening CPA’s competitive position beginning January 1, 2026.
This potential outcome was previewed with the Board during CPA’s annual rate setting process earlier this year. The precise impact of the rate changes will remain uncertain until the CPUC makes a decision on the ERRA proposal in December and SCE publishes its new rates near the end of December. CPA and CalCCA are advocating for modifications to SCE’s proposal consistent with regulations and past precedent. If adopted, these changes would reduce the magnitude of the PCIA increase. The Board could consider a rate adjustment prior to the regular Fiscal Year 2026-2027 rate setting cycle.
Karen Schmidt, Senior Director, Rates and Strategy, presented details regarding rate comparisons and bill impacts to CPA customers, with a breakdown of energy product cost increases. At its November meeting, the Executive Committee will consider recommended timing and level of interim rate adjustment for the Board’s consideration. A February rate change would provide customers with quicker bill relief. However, this approach involves significant uncertainty as SCE rates could swing based on the outcome of disputed issues, and CPA will have fewer months of financial results available to inform the decision. A decision for a March rate change could allow for a larger rate reduction.
Board action in December would be to adopt a rate approach rather than adopt exact rates. SCE rates will be known in late December. Based on feedback from Executive Committee, staff will return to the Board with options for an interim rate change. Those options will continue CPA’s Board-endorsed practice of harmonizing bill comparisons across PCIA vintages, with the exception of new communities during their first enrollment year. CPA, CalCCA, and the other CCAs in SCE territory are responding to SCE’s ERRA filing, advocating for modifications to SCE’s treatment of banked Renewable Energy Credits.
The Board had no questions or comments on this item.
NOTICE OF PUBLIC HEARING ON DECEMBER 4, 2025, TO CONSIDER A
RESOLUTION TO APPROVE AN IMPLEMENTATION PLAN ADDENDUM ADDING
THE CITIES OF CUDAHY AND FILLMORE AND TO AUTHORIZE STAFF TO SUBMIT
AN ADDENDUM TO THE CALIFORNIA PUBLIC UTILITIES COMMISSION Chair Klein Lopez provided notice of a public hearing on December 4, 2025.
COMMITTEE CHAIR UPDATES
Director Santangelo, Chair of the Finance Committee, congratulated CPA staff for their work resulting in a clean financial audit.
MANAGEMENT REPORT
Mr. Bardacke reported that CPA has met its Resource Adequacy reliability requirements and thanked staff for their contributions to the success of that effort. Mr. Bardacke praised Board members for being part of CPA’s success in earning awards, such as the recent ones given by the Los Angeles Business Council and Active San Gabriel Valley.
Agenda Page 11
Board of Directors Item 1
BOARD MEMBER COMMENTS
None.
REPORT FROM THE CHAIR
None.
ADJOURN
Chair Klein Lopez adjourned the meeting at 4:09 p.m.
Agenda Page 12
Staff Report – Agenda Item 2
To: Board of Directors
From: Christian Cruz, Senior Community Outreach Manager Reviewed by: Gina Goodhill, Senior Director, Government Affairs Approved By: Ted Bardacke, Chief Executive Officer
Subject: Appointment of New Community Advisory Committee Member Date: December 4, 2025
RECOMMENDATION
Appoint one new member to the CAC for the open position in the San Gabriel Valley Region for the remainder of the term, expiring April 2026.
BACKGROUND
On June 7, 2018, the Board of Directors approved a structure for the CAC to provide input on various policy and planning issues and serve as a voice for CPA in the community.
Each CAC member serves a two-year term at the pleasure of the Board.
In September 2025, CAC Member Leslie Diaz-Villavicencio vacated one of the San Gabriel Valley seats due to work obligations.
RECOMMENDED CAC APPOINTMENT
Staff worked with member jurisdictions and stakeholders to identify suitable applicants for the vacant seat in the San Gabriel Valley Region. Staff recommend that the Board appoint Hamarz Aryafar to the vacant seat for the remainder of the current term, which ends in April 2026. The applicant summary for the recommended appointee is attached.
If the Board approves this appointment, all fifteen seats on the CAC will be filled.
ATTACHMENT
1) CAC Recommended Appointment and Applicant Summary
Agenda Page 13
Board of Directors Item 2
RECOMMENDED APPOINTMENTS
East Ventura/West LA County
(Agoura Hills, Camarillo, Calabasas, Moorpark,
Simi Valley, Thousand Oaks, Westlake Village)
Current Appointees
• Angus Simmons
• Debbie West
• Kat Selm
San Gabriel Valley
(Alhambra, Arcadia, Claremont, Monrovia, Sierra
Madre, South Pasadena, Temple City)
Current Appointees
• Casey Law
Recommended appointment:
• Hamarz Aryafar
West/Unincorporated Ventura County
(Ojai, Oxnard ,Port Hueneme, Santa Paula
Ventura, Unincorporated Ventura County)
Current Appointees
• Kent Bullard
• Daniel Mora
South Bay
(Carson, Hawthorne, Hermosa Beach, Manhattan
Beach, Redondo Beach, Rolling Hills Estates)
Current Appointees:
• Cort Casady
• Diane Wallace
Gateway Cities
(Downey, Hawaiian Gardens, Lynwood,
Paramount, Whittier)
Current Appointee
• Genaro Bugarin (Vice-Chair)
• Luis Alvarez
Westside
(Beverly Hills, Culver City, Malibu, Santa Monica,
West Hollywood)
Current Appointees
• Cris Gutierrez
• David Haake
Unincorporated LA County
Current Appointee
• Neil Fromer (Chair)
• Margaret Fuentes
Agenda Page 14
Board of Directors Item 2
2025 Community Advisory Committee New Applicant Summary Candidate: Hamarz Aryafar Subregion: SGV Eligible Candidate: Yes Section 1: Personal Information
A. Home Address: La Canada Flintridge, CA
B. Occupation: Chief Technology Officer
Section 2: Qualifications
A. Experience serving on advisory committees / public commissions / similar bodies:
• As part of my work at Element 16 I have attended multiple events hosted by the California Energy Commission including workshops for energy storage and advisory panels for renewable energy.
B. Experience with outreach or community leadership:
• I volunteer at Paradise Canyon Elementary school, chaperon field trips, help during class lessons. I also volunteer for a local Girl Scout troop and conduct STEM lessons.
C. Experience or expertise in energy field:
• My company has created a new energy storage technology that we are deploying in California for industrial customers. By charging from cheap or negatively priced electricity, we can output heat as a utility for industrial customers at costs lower than one would get from burning natural gas.
D. Other skills / knowledge / experience to bring to Committee:
• Ph.D. Aerospace Engineering, 10 years developing energy storage technologies Section 3: Additional Information
A. Why you are interested / what you hope to achieve:
• Electricity prices are very high in my region, and if I can help in any way to lower them, I should try.
B. List affiliations, councils, or committees you are currently a member of. • N/A
C. List other languages / ability to support non-English speaking communities:
• N/A
D. Anything else you would like CPA to know:
• N/A
Section 4: Commitment
A. I am able to attend meetings, serve a two-year term, and work to help the organization meet its mission and goals.
B. Signed to certify electric holder in CPA service territory and meet eligibility requirements? Yes.
Agenda Page 15
Staff Report – Agenda Item 3
To: Board of Directors
From: Gina Goodhill, Senior Director, Government Affairs CC Song, Senior Director, Regulatory Affairs
Approved By: Ted Bardacke, Chief Executive Officer
Subject: 2026 Legislative and Regulatory Policy Platform Date: December 4, 2025
RECOMMENDATION
Approve CPA's 2026 Legislative & Regulatory Policy Platform as recommended by the Legislative & Regulatory Committee.
BACKGROUND
The 2025 Legislative year wrapped up on September 13th with the passage of a collection of bills meant to improve electricity affordability, maintain and expand grid reliability, and extend and improve California’s investments in climate protection. While CPA and the larger CCA community did not achieve everything it set out to accomplish, it was overall a successful year for CCAs and clean energy, especially in the face of current and pending federal cuts.
One of the highest profile bills of the year was AB 825 (Petrie-Norris, Becker, Rivas), the multiyear effort to create a regional energy market for California and other western states. Previous legislative efforts to expand CAISO operations across western states focused on creating a new governing entity for all CAISO functions, such as transmission, operations, markets, and other key components of the grid, which led to concerns and opposition from key stakeholder groups over threats to California’s autonomy. In contrast, AB 825 focused solely on the markets function of CAISO without touching other grid Agenda Page 16
Board of Directors Item 3
responsibilities and was the result of a multiyear effort – The West-Wide Governance Pathways Initiative – led by California regulators and stakeholders (including CalCCA) and regulators from Arizona, New Mexico, Oregon, Washington, Colorado, Idaho, Montana, Nevada, Utah, and Wyoming.
The passage of AB 825 comes as other states volley for their own expanded energy market and compete for western state membership. This dynamic created a time-sensitivity to moving forward with a western-led energy market overseen by an independent regional organization (RO), especially as projections show it could save ratepayers up to $800 million a year, while reducing overall greenhouse gas emissions and increasing grid reliability. While the bill underwent many variations throughout the year, the final version was supported by CCAs (including CPA), labor, environmental and clean energy groups, and IOUs alike. CPA will continue to track this policy as the new independent regional organization is created.
Another high-profile energy bill, SB 254 (Becker), was the legislature's direct attempt to address electricity affordability. Sparked by analysis from a 2024 report by Net-Zero California and Clean Air Task Force that looked at utilizing public-private partnerships to bring down the costs of transmission, the bill established the California Transmission Infrastructure Accelerator to give public agencies a role in financing the roughly $156 billion worth of transmission that will need to be spent to meet the state’s 2045 clean energy goals. The new interest in public-private financing partnerships may be a good fit for CCAs to use their status as public entities to bring down the cost of transmission financing, and CPA was engaged and supportive of this part of the legislation. CPA will continue to pursue this topic in the 2026 legislative year, following direction from CPA's Board Retreat, and reflected in the Proposed 2026 Policy Platform.
In addition to public financing, SB 254 also provided an additional $18 billion of funding for the California Wildfire Fund, half of which is paid for by IOU shareholders and the other half to be paid for by ratepayers through a decade-long extension (through 2045) of an existing ~$3/month charge on electricity bills. Rules around how IOUs profit from grid hardening were also tightened in the bill.
Agenda Page 17
Board of Directors Item 3
Finally, California’s landmark Cap and Trade program was extended until 2045 through both SB 840 (Limon) and AB 1207 (Irwin). Since 2006, California’s Cap and Trade program has been responsible for regulating about 75 percent of the state’s greenhouse gas emissions, and for generating $3-4 billion a year for programs to support climate change adaptation and resilience. The program was set to expire in 2030 but was extended through 2045 and renamed “Cap and Invest”. Among other things, the extension increases the amount of funding for, and changes the timing of, the California Climate Credit. Under the new law, the credit would be applied to customers’ bills in the four highest billed months of the year, when customers most need bill assistance. CPA sponsored a bill that took a similar approach and supports shifting the credits to what are typically the hottest months of the year for CPA customers.
The Governor signed all of these bills into law on September 19 and they will go into effect on January 1, 2026.
Not all proposals were as successful. Efforts to create new demand management and load shifting requirements and promote Virtual Power Plants (some of which CPA supported), fared less well, with the Governor vetoing most bills on this issue and funding being cut in the state budget.
Increased load from data centers and the rise of artificial intelligence was another hot legislative and regulatory topic, though ultimately no substantive energy legislation on the issue moved forward. One proposal that was discussed and could resurface next year focused on how large non-residential customers should receive electricity service. Some proposals included language to change CCAs as the default provider, and to limit customer’s ability to change between a CCA and an IOU. Language has been added to the draft Policy Platform to address this proposal in case it resurfaces.
PROPOSED 2026 PLATFORM
CPA’s Policy Platform serves as a framework for staff to pursue actions at legislative and regulatory levels with the understanding that they are taking actions in the best interest of the organization, member agencies, and customers. Every year, staff modifies the Agenda Page 18
Board of Directors Item 3
platform in response to various legislative and regulatory changes and presents a draft to the Legislative & Regulatory Committee.
For bills that fall outside the scope of the platform, bills that are likely to attract high-profile supporters and detractors, bills that would directly raise taxes, or bills that would knowingly and substantially put CPA at odds with its member agencies, CPA presents a proposed position to the Legislative & Regulatory Committee and Board of Directors before taking a position.
The 2026 Draft Legislative and Regulatory Platform responds to some of the energy topics that CPA anticipates arising in the 2026 legislative year, specifically around data centers and affordability in the face of wildfire hardening. Language was also amended to clarify and clean up several principles.
• Principle 1a was broken into two principles to focus more clearly on affordability in the face of rising costs resulting from fire resilience and grid hardening. • Principle 1e was added to address CCAs autonomy as the default service provider for all eligible customers in its service territory, including large load customers such as data centers.
• Principle 2d was absorbed into Principle 2b to streamline the platform and avoid duplication.
• Principle 4a was expanded to reflect the importance of getting timely and accurate customer data to procure enough power for the expected load from data centers. • Principle 5a was amended to clarify intention, and to emphasize elements of environmental justice.
ATTACHMENT
1. Proposed 2026 Legislative & Regulatory Policy Platform Agenda Page 19
Proposed
2026 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 directly 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.
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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 platform below.
Policy Platform
1. Affordability and Local Control
a. Fair rates and cCost allocation: CPA will pursue administrative and legislative initiatives that will ensure that non-bypassable charges for CPA customers, including any income-graduated based fixed charges, are assessed fairly compared to bundled customers and that CPA’s customers are not unnecessarily burdened by non-bypassable charges.
a.b. Fair rates: CPA will engage in legislative initiatives that seek to ensure that rates are reasonable and transparent, and that balance evolving wildfire and grid hardening needs with affordability.
b.c. 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. d. CCA Expansion: CPA will pursue administrative and legislative initiatives to protect CPA’s ability to expand its service to new member agencies. e. Customer Acquisition: CPA will pursue administrative and legislative initiatives that preserve the CCA model as the default service provider for all eligible customers in its service territory.
c.f. 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.
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d.g. 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
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, as well as providing CPA adequate and equal access to transmission capacity. 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.d. Access to the Electrical GridCustomer Internconnection: 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.
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f.e. 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.f. 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 ratepayers and load serving entities; maintains California’s ability to set, meet 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, and properly plan for procurement needs.
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b. 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, and other factors. c. Billing Transparency: CPA will pursue administrative and legislative initiatives that increase customer understanding of electricity bill components and display electricity charges in a clear and consistent manner for both bundled and unbundled customers.
5. Diversity, Equity, Inclusion
a. Customer ProtectionProtecting vulnerable customers: CPA will pursue administrative and legislative initiatives that support the protection ofhealthy communities all ratepayers, particularly environmentalparticularly 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 transgender owned business enterprises.
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.
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Staff Report – Agenda Item 4
To: Board of Directors
From: Karen Schmidt, Senior Director, Rates & Strategy
Reviewed by: Matthew Langer, Chief Operating Officer
Approved By: Ted Bardacke, Chief Executive Officer
Subject: Phase 7 Subset Rates
Date: December 4, 2025
RECOMMENDATION
Adopt Resolution 25-12-097 to approve Fiscal Year 2025-26 rates for Phase 7 subset customers under rate schedules TOU-8, TOU-GS-3, AND TOU-PA (“non-streetlighting subset rates”) effective January 1, 2026.
BACKGROUND
On December 5, 2024, the Board adopted Resolution 24-12-078 establishing a rate setting approach for the new communities beginning CPA service in October 2025 – La Cañada Flintridge, Lynwood, and Port Hueneme, also referred to as “Phase 7” – to cover the new customers’ cost of service and contribute to CPA’s financial goals while providing competitive and predictable rate comparisons during these communities’ launch of CPA service. The Phase 7 rate setting approach maintains total bill comparisons for Phase 7 commercial customers on “subset” rates1 at or below the levels adopted by the Board for existing communities in July 2024 for the duration of FY 2025-2026. At that time, the Board authorized staff to update rates for the Phase 7 communities periodically as 1 Subset customers are on TOU-8, TOU-GS-3, TOU-PA, LS, and AL rate schedules in Phase 7 service areas.
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Board of Directors Item 4
needed when SCE and/or PCIA rates change, to maintain this approach throughout FY 2025-2026.
In October 2025, Southern California Edison (SCE) filed its 2026 Energy Resource Recovery Account (ERRA) update with the California Public Utilities Commission proposing Power Charge Indifference Adjustment (“PCIA”) rate changes to go into effect January 1, 2026, with significant variation in PCIA changes across different PCIA vintages.
DISCUSSION
Because of the significant variation in expected PCIA rate changes on January 1, 2026 across different PCIA vintages, adhering to the approach for Phase 7 subset rates set forth in Resolution 24-12-078 would result in a misalignment of margins across Phase 7 customer classes that would be inconsistent with CPA’s Cost of Service approach to rate setting when the PCIA rates change on January 1, 2026. To address this inconsistency, staff proposes setting all Phase 7 non-streetlighting subset rates, i.e., TOU-8, TOU-GS-3, and TOU-PA, at the same total bill comparison levels as Phase 7 residential and small/medium business3 rates such that total bill comparisons are at a 1% discount to SCE for Lean Power, a 0% discount (parity) for Clean Power, and a 5% premium for 100% Green Power starting on January 1, 2026. This revised approach would bring Phase 7 margins into alignment across customer classes while remaining consistent with the Board’s Phase 7 rate setting and Cost of Service approach, maintaining competitiveness with SCE, and contributing to CPA’s financial goals.
The table below provides the current total bill comparisons for Phase 7 sample subset rates and the projected total bill comparisons as of January 1, 2026 based on the current Phase 7 rates setting approach established in Resolution 24-12-078. Staff’s proposed additional Phase 7 subset rate reduction to match Phase 7 residential and small/medium business comparison targets would bring margins into alignment across Phase 7 subset 3 Small and medium business customers are on TOU-GS-1, TOU-GS-2, TOU-EV, TC, and WTR rate schedules in Phase 7 service areas.
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Board of Directors Item 4
and non-subset (i.e., residential and small/medium business) customer classes. The rate reduction would result in a projected $250,000 reduction in CPA’s FY 2025-2026 contribution to net position and a de minimis impact to CPA reserves.
Phase 7 Total Average Annual Bill Comparisons for Sample Subset Rates Comparisons as of
October 1, 2025
Projected Comparisons
as of January 1, 2026*
Proposed January 1, 2026
Comparison Targets
Rate Schedule
Lean Clean 100%
Green Lean Clean 100%
Green Lean Clean 100% Green
TOU-GS-3-D -6.7% -4.6% 2.5% 0.4% 3.4% 8.7% -1.0% 0.0% 5.0% TOU-8-D-SEC -6.2% -3.3% 2.5% 1.1% 2.6% 8.8% -1.0% 0.0% 5.0% TOU-PA-2-D -7.4% -7.0% 0.4% 0.3% 1.3% 6.9% -1.0% 0.0% 5.0% TOU-PA-3-D -6.7% -6.3% 1.3% 1.1% 2.2% 7.9% -1.0% 0.0% 5.0% LS-1 9.5% 13.3% 20.2% 19.2% 20.4% 26.7% 19.2% 20.4% 26.7% *Based on projected SCE and PCIA rates as of January 1, 2026, most Phase 7 subset rates would be reduced to meet the maximum Phase 7 FY 2025/26 total annual bill comparisons approved by CPA Board Resolution 24-12-078. Comparisons are based on representative 2025 PCIA vintage rate schedules, average customer usage, and load profiles for each specified rate class. Individual customer comparisons will vary by specific rate schedule and customer usage.
ATTACHMENT
1. Resolution 25-12-097
Agenda Page 27
RESO NO. 25-12-097
RESOLUTION NO. 25-12-097
A RESOLUTION OF THE BOARD OF DIRECTORS OF THE
CLEAN POWER ALLIANCE OF SOUTHERN CALIFORNIA
TO APPROVE FISCAL YEAR 2025-26 RATES FOR PHASE
7 SUBSET CUSTOMERS UNDER RATE SCHEDULES
TOU-8, TOU-GS-3, AND TOU-PA
THE BOARD OF DIRECTORS OF THE CLEAN POWER ALLIANCE OF SOUTHERN CALIFORNIA DOES HEREBY FIND, RESOLVE, AND ORDER AS FOLLOWS:
WHEREAS, the Clean Power Alliance of Southern California (formerly known as Los Angeles Community Choice Energy Authority) (“Clean Power Alliance” or “CPA”) was formed on June 27, 2017;
WHEREAS, on October 1, 2025, Phase 7 commenced with the enrollment of all customers in La Cañada Flintridge, Lynwood, and Port Hueneme, necessitating the adoption of rates for Phase 7 customers;
WHEREAS, on December 5, 2024, the Board approved Resolution 24-12-078 adopting a FY 2025-2026 rate setting approach for Phase 7 customers after carefully considering the staff report and its accompanying exhibits at a publicly-noticed meeting, to provide these new customers with predictable and competitive rates prior to and during launch of service in October 2025:
a. Set residential and small/medium business1 rates such that total bill comparisons are at a 1% discount to SCE for Lean Power, a 0% discount (parity) for Clean Power, and a 5% premium for 100% Green Power, which is designed to cover the customers’ cost of service and contribute to CPA’s financial goals.
b. Set subset rates2 for the new communities such that total bill comparisons for each subset rate schedule do not exceed the July 1, 2024 levels, which is designed to cover the subset customers’ cost of service and contribute to CPA's financial goals.
(subsections (a)-(b) are collectively referred to as “Phase 7 Rate Setting Approach”); WHEREAS, Resolution 24-12-078 authorizes the Chief Executive Officer to update Phase 7 rates, as needed whenever SCE and/or PCIA rates change, to maintain the Rate Setting Approach throughout FY 2025-2026;
1 Small and medium business customers are on TOU-GS-1, TOU-GS-2, TOU-EV, TC, and WTR rate schedules in Phase 7 service areas.
2 Subset Customers are on TOU-8, TOU-GS-3, TOU-PA, LS, and AL rate schedules in Phase 7 service areas.
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RESO NO. 25-12-097
WHEREAS, in October 2025, CPA received information in the Energy Resource Recovery Account proceeding at the California Public Utilities Commission indicating that CPA can expect a significant variation in the Power Charge Indifference Adjustment (“PCIA”) rate changes on January 1, 2026 across different PCIA vintages; WHEREAS, at this December 4, 2025 meeting, the Board considered the staff report at its publicly-noticed meeting, including a consideration of CPA’s reserves, CPA’s competitiveness across customer classes mitigating opt out risk, consistency within CPA’s cost of service approach, and the potential impact of changes to the Power Charge Indifference Adjustment and its impact on CPA’s Subset Customers. Based on these considerations, the Board agreed that updating the Phase 7 Rate Setting Approach to Subset Customers, except for those customers under streetlighting rates (also referred to as LS and AL), is prudent and reasonable; and WHEREAS, the Board further determined at the December 4, 2025 meeting that the Subset Customer rates should be updated as of January 1, 2026, in order that CPA’s Subset Customers rates remain consistent with CPA’s Cost of Service approach, and that the most reasonable approach would be to adjust the non-streetlighting Subset Customer rates to be consistent with the Phase 7 Rate Setting Approach for residential and small/medium businesses.
NOW THEREFORE, BE IT DETERMINED, ORDERED, AND RESOLVED, BY
THE BOARD OF DIRECTORS OF THE CLEAN POWER ALLIANCE OF SOUTHERN CALIFORNIA THAT:
1. Effective on January 1, 2026, the subset rates under TOU-8, TOU-GS-3, and TOU-PA rate schedules, except for streetlighting rates (LS and AL), shall be adjusted to align with the Phase 7 Rate Setting Approach for residential and small/medium business such that total bill comparisons are at a 1% discount to SCE for Lean Power, a 0% discount (parity) for Clean Power, and a 5% premium for 100% Green Power, which is designed to cover the customers’ cost of service and contribute to CPA’s financial goals.
2. Staff are directed to develop rates for Phase 7 Subset Customers rates consistent with ordering paragraph 1.
3. The Chief Executive Officer is authorized to update the Phase 7 subset rates, as needed throughout FY 2025-2026 whenever SCE and/or PCIA rates change, to maintain the total bill comparisons specified in ordering paragraph 1.
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RESO NO. 25-12-097
APPROVED AND ADOPTED this 4th day of December 2025.
Deborah Klein Lopez, Chair
ATTEST:
Gabriela Monzon, Secretary
Agenda Page 30
Staff Report – Agenda Item 5
To: Board of Directors
From: Sona Coffee, Senior Program Manager, Local Government Programs
Reviewed By: Joanne O’Neill, Senior Director, Customer Programs Matthew Langer, Chief Operating Officer
Nancy Whang, General Counsel
Approved By: Ted Bardacke, Chief Executive Officer
Subject: Approve Energized Communities Innovation Fund Round 2 Recipients and Authorize the CEO to Execute Participation Agreements
Date: December 4, 2025
RECOMMENDATION
Approve six Innovation Fund Round 2 recipients and authorize the Chief Executive Officer to execute Participation Agreements with each of the selected member agencies listed below to implement the proposed Innovation Fund projects for total funding in the amount of $1,250,000:
i. Alhambra (in the amount of $168,450)
ii. Carson (in the amount of $163,100)
iii. Los Angeles County (in the amount of $250,000)
iv. Thousand Oaks (in the amount of $168,450)
v. Ventura County (in the amount of $250,000); and,
vi. Whittier (in the amount of $250,000)
BACKGROUND
The Innovation Fund is a competitive funding opportunity for CPA’s member agencies to address a range of sustainability projects that align with CPA’s mission and its program Agenda Page 31
Board of Directors Item 5
pillars: Resilience and Grid Management, Transportation and Building Electrification, and Local Clean Energy Procurement. CPA’s member agencies were invited to submit project proposals for up to $250,000 in total funding that align with one or more of these pillars based on the community's needs.
In April 2023, CPA staff proposed a $2 million Innovation Fund, to be dispersed through two rounds of funding; budget has been authorized for the Innovation Fund beginning with the FY 2024/25 budget. In October 2024, CPA launched the first round of the Innovation Fund; eight applications were received last December and the Board approved the Round 1 Innovation Fund recipients at its March 2025 meeting. Currently, there are four projects underway, totaling $750,000 in funding, for the cities of Carson, Culver City, Santa Monica, and West Hollywood. These projects focus on electrification of buildings, equipment, and transportation, and support resilience and grid management for income-qualified renters.
The remaining budget of $1,250,000 was made available for Round 2 of the Innovation Fund. Applications were due October 8, 2025.
DISCUSSION
For Innovation Fund Round 2, fourteen proposals were submitted, requesting $3,412,383 in funding for projects that focus on building and transportation electrification, electrification of landscape equipment, heat resilience for renters, and several community-wide resilience projects.
Review and Selection of Innovation Fund Proposals
To review the proposals and make a recommendation for funding, CPA convened a Review Team comprised of two Community Advisory Committee members (one from Los Angeles County and one from Ventura County) along with four CPA staff members representing different parts of the organization.
The Review Team scored the proposals based on three criteria: mission alignment (30%), feasibility (20%), and project benefits (50%). Based on the Review Team’s recommendations, six of the fourteen Innovation Fund Round 2 proposals are Agenda Page 32
Board of Directors Item 5
recommended for Board approval, as summarized in Table 1. Four proposals are recommended for the full requested amount of funding, and two proposals are recommended for partial funding. These six projects focus on a variety of initiatives including building electrification, electric vehicle (EV) ride sharing, electrification of landscape equipment, and heat resilience for renters.
If the recommended projects are approved by the Board, CPA staff will work with each corresponding member agency to finalize and execute Participation Agreements.
Following the launch of the approved projects, CPA and member agency staff will meet regularly to review project status and share progress. Each project is expected to be completed within a two-year timeframe, and each member agency will be reimbursed, based on project needs and progress per the Participation Agreement.
Table 1: Recommended Round 2 Innovation Fund Recipients Agency Proposal Description CPA Program
Pillars Score Requested Funding
Recommended
Funding
1. Los
Angeles
County
LA County Cool Homes
Install heat pumps in 300
unincorporated LA County
renter households in Low-Income and
Disadvantaged
Communities (LIDAC),
and train at-risk youth to
install the units and
provide technical
assistance.
• Resilience &
Grid
Management
• Local Clean
Energy
Procurement
87 $250,000 $250,000
2. Carson Carson’s Residential
Lawn and Garden
Equipment Rebate
Program
Provide $250 rebates to
300 residents for lawn tool
electrification, and plan to
electrify 500 pieces of
equipment.
• Electrification 87 $163,100* $163,100
3. Whittier Expansion of Whittier
Cruiser EV Program
Sustain and possibly
• Electrification 86.5 $250,000 $250,000
Agenda Page 33
Board of Directors Item 5
expand the Whittier
Cruiser, an electric, on-demand micro-transit
program that provides free
rides for an estimated
60,000 passengers
annually.
4. Ventura
County
Ventura County Skilled
and Trained Community
Heat Pump Rebate
Partner with Sheet Metal
Workers' Local Union 104
to deliver point-of-sale
rebates to 100 households
purchasing heat pump
HVAC systems.
• Electrification
• Local Clean
Energy
Procurement
84.6 $250,000 $250,000
5. Thousand
Oaks
Residential Induction
Stove Rebate Program
Provide rebates to
homeowners who install
induction stoves.
Incorporate targeted
marketing and offer a
tiered structure for
CARE/FERA households
to receive an additional
incentive amount.
• Electrification 81 $250,000 $168,450
6. Alhambra Alhambra Equity-Driven
Green Equipment
(EDGE) Pilot Program
Provide low-income renter
households with electric
appliances, including
HEPA air purifiers,
portable heat pump HVAC
units, and smart plugs.
• Resilience &
Grid
Management
80.5 $250,000 $168,450
Total Funding: $1,413,100 $1,250,000
* Carson received $86,900 in Round 1 funding
Eight proposals are not recommended for funding at this time. Feedback is being, or will be, provided to member agency staff whose proposals were not selected for funding during Round 2.
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Board of Directors Item 5
Table 2: Project Proposals Not Recommended for Innovation Fund Round 2 Agency Proposal Description CPA Program Pillars Score Requested Funding
1.Malibu Traffic Signal Power
Resiliency
• Resilience & Grid
Management
• Local Clean Energy
Procurement
79.5 $250,000
2. Downey Solar Powered
Streetlighting Project
• Resilience & Grid
Management
• Local Clean Energy
Procurement
77.5 $249,908
3. Monrovia Resiliency Planning after
Natural Disaster
• Resilience & Grid
Management
• Local Clean Energy
Procurement
76 $250,000
4. Manhattan
Beach
Public Works Electrification
and Decarbonization
Project
• Resilience & Grid
Management
• Electrification
• Local Clean Energy
Procurement
75.5 $249,375
5. City of
Ventura
Community Electrification
Incentive Program -'Amp Up
Ventura'
• Electrification
70.5 $250,000
6. Camarillo Resilient Camarillo:
Integrated Mobility and
Emergency Response
Initiative
• Resilience & Grid
Management
70.5 $250,000
7. Temple
City
Energy Sustainability and
Resilience at Live Oak
Park
• Resilience & Grid
Management
70 $250,000
8. Westlake
Village
Emergency Operations
Resiliency Battery Project
• Resilience & Grid
Management
67 $250,000
Total Funding Requested: $1,999,283
Agenda Page 35
Board of Directors Item 5
Future Resilience-Based Funding Opportunity
As part of the review process, the Review Team and CPA staff noted that there were seven proposals centered around community-wide resilience projects that are not recommended for funding in this round, including several that involve batteries not connected to the grid. While there is interest in supporting community-wide resilience projects, the proposals that focused on direct resilience benefits to individual customers scored higher under the current evaluation criteria.
To better address and evaluate the benefits of community-wide resilience projects, staff will develop a proposal for a Round 3 of the Innovation Fund specifically focused on community-wide resilience. Staff expect to be able to launch this Round 3 in the first half of 2026 and include funding in the proposed FY 2026/27 budget. In developing Round 3, staff will specifically consult with those member agencies not funded in the current round and invite them to revise and resubmit their applications according to updated requirements and evaluation criteria.
FISCAL IMPACT
The Board-approved FY 2025/26 budget includes sufficient funding to begin implementation of the Innovation Fund Round 2 projects. Costs for continued implementation of Round 1 and Round 2 projects, and the proposed Innovation Fund Round 3, will be included in future budget proposals.
ATTACHMENT
None.
Agenda Page 36
1 Staff Report – Agenda Item 6
To: Board of Directors
From: Nancy Whang, General Counsel
Reviewed by: Dr. Monique Edwards-Greer, Chief Administrative Officer Subject: CEO Contract Extension and Amendment
Date: December 4, 2025
RECOMMENDATION
Approve amendment to CEO’s Employment Agreement extending the term to December 31, 2029, and modifying the CEO’s Retention Incentive payment methodology in order to create an incentive for the CEO to complete the full term of the extension and authorize the Chair of the Board of Directors to execute the amendment to the CEO’s Employment Agreement on CPA’s behalf.
No increase to the CEO's base annual salary of $477,403 is proposed.
BACKGROUND/SUMMARY
In November 2021, the CPA Board approved a 5-year contract for the CEO that runs through the end of December 2026. On November 20, 2025, the Executive Committee met in Closed Session to conduct the CEO’s annual performance review consistent with the CEO’s Employment Agreement. At the conclusion of Closed Session, the Executive Committee directed the General Counsel to draft a contract amendment for consideration by the Board extending the term to December 2029 and addressing the Retention Incentive payment methodology for the CEO so that the CEO is incentivized to fulfill the extension.
The proposed contract amendment meets ExCom’s direction, including a modification of the CEO’s Retention Incentive payment methodology to create a strong financial incentive for the CEO to fulfill the full term of the extended contract.
Agenda Page 37
Board of Directors Item 6
2 DISCUSSION
Prior to the contract extension being discussed by the Executive Committee, a salary survey of the CEOs of the ten largest CCAs in the state that are organized as multi-jurisdiction JPAs was conducted. The survey focused on both base salary and total annual cash compensation (TCC). The survey showed CPA’s CEO to be ranked 6th of 10 in base salary and 2nd of 10 in TCC. This TCC ranking is commensurate with the CEO being 3rd of 10 in tenure among the CCAs surveyed, with the highest annual revenue, greatest number of member communities, and 4th of 10 in number of staff. Therefore, no change to base salary, upon which TCC is calculated, is proposed.
The difference in ranking between base salary and TCC is due to the significant portion (up to 20%) of the CEO’s TCC coming in the form of an organizational performance-based Retention Incentive that was approved by the Board in September 2023 and is available to the CEO and other executives and high-level managers at CPA. The structure of the Retention Incentive,1 which is appropriate for CPA employees who do not have a contract end date, inadvertently creates a disincentive for the CEO to fulfill the final 2.5 years of his contract, during which time he would effectively be subject to a 20% cut in TCC.
Given the desire of both parties that the contract term be fulfilled and the large role the Retention Incentive plays in the CEO’s overall compensation, a modification to the CEO’s Retention Incentive payment methodology is proposed. This modification would result in the CEO having a strong financial incentive to complete the full term of an extended contract by making him eligible for all Retention Incentives earned should he fulfill the contract until its end date.
1 Employees eligible for the Retention Incentive earn it based on performance metrics measured at the end of one fiscal year (the “Performance Period”) but do not receive payment until two years later and only in the event that they continue to be employed by CPA at that time. See Attachment 2 for further details.
Agenda Page 38
Board of Directors Item 6
3 FISCAL IMPACT
Funds for Retention Incentive payments to be paid to the CEO for the next two years have already been included in prior Board-approved budgets. Future Retention Incentive funds will be included in future proposed budgets.
ATTACHMENTS
1. Proposed CEO Employee Contract Amendment
2. CPA Retention Incentive Program
Agenda Page 39
-1-
AMENDMENT NUMBER TWO TO EMPLOYMENT AGREEMENT -
CLEAN POWER ALLIANCE
CHIEF EXECUTIVE OFFICER TED BARDACKE
This Amendment Number Two (“Amendment Two”) to the Employment Agreement (“Agreement”) is made by and between Clean Power Alliance of Southern California (“CPA”) and Ted Bardacke, an individual (“Employee”). CPA and Employee may individually be referred to herein as a “Party,” or collectively as the “Parties.” This Amendment Two is effective as of December x, 2025 (“Amendment 2 Effective Date”).
RECITALS
This Amendment Two is entered into based on the following facts, understandings, and intentions of the Parties:
A. CPA is a Community Choice Aggregation Program (“CCA Program”) established pursuant to California Public Utilities Code Section 366.2(c)(12) with 38 member counties and cities (“Member Agencies”). These Member Agencies are signatories to the Clean Power Alliance of Southern California Joint Powers Agreement (the “JPA Agreement”) which serves as the operative document in the implementation, administration, and operation of the CCA Program.
B. Section 5.5 of the JPA Agreement provides that the CPA Board of Directors (“Board”) shall appoint a Chief Executive Officer for the CPA, who shall be responsible for the day-to-day operation and management of the CPA and the CCA Program and provides for the exercise of powers and authority by the Chief Executive Officer.
C. On December 1, 2022, the Board of Directors of CPA (“Board”) approved an Amended and Restated Employment Agreement between CPA and Employee (“Agreement”) with an effective date of January 1, 2023.
D. On September 7, 2023, the Board approved an Amendment Number One to Employment Agreement between CPA and Employee (“Amendment One”), which clarified Employee’s entitlement to the Board-adopted Retention Incentive Program.
E. The Board desires to extend the term of Employee’s agreement and provide a retention incentive payment methodology that would incentivize Employee to complete the term of the extension.
NOW, THEREFORE, it is mutually agreed by and between the Parties hereto to amend the Agreement as follows:
1. Term: Paragraph 2 of the Agreement shall be amended as follows:
a. Unless earlier terminated as provided for in this Agreement, the term of this Agreement shall expire on December 31, 2029 be for five (5) Agenda Page 40
-2-
years, commencing on the Effective Date (the “Term”).
2. Benefits: Paragraph 5 of the Agreement shall be amended as follows:
a. Benefits. During the Term of this Agreement, Employee shall be entitled to all benefits offered to CPA employees, including but not limited to vacation, group insurance plans, incentive or retirement programs, including any Retention Incentives in conformance with a Board-adopted Retention Incentive Program, paid time off, sick leave, and expense reimbursement. Employee acknowledges that CPA may establish additional benefit programs or may be modify, reduce, or eliminate any benefit plan or program at the discretion of the Board, in accordance with applicable law. Notwithstanding the provisions of the Retention Incentive Program, Employee shall be considered an Eligible Employee throughout the Term and entitled to earn and be paid the Contingent Amount of the any Retention Incentive that has been budgeted and set aside for Employee during the Term up to and including the month of expiration, unless the Agreement is earlier terminated as provided for in this Agreement, in which case the terms of the Retention Incentive Program current at the time of termination shall apply. if the Agreement expires after the end of the applicable Performance Period but prior to end of the Waiting Period. Capitalized terms not defined herein related to the Retention Incentive Program shall have the meaning ascribed to them in the Board-adopted Retention Incentive Program.
3. Except as specifically amended hereby, all otherterms and conditions of the Agreement shall remain in full force and effect.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed as of the date first above written.
CLEAN POWER ALLIANCE OF SOUTHERN CALIFORNIA
By______________________________ ____________________
Deborah Klein Lopez, Board Chair Date
By______________________________ ____________________
Ted Bardacke Date
APPROVED AS TO FORM:
By______________________________ ____________________
Nancy Whang, General Counsel Date
Agenda Page 41
Clean Power Alliance Retention Incentive Program (Policy) I. Purpose
Clean Power Alliance (CPA) operates in a unique and specialized labor market and competes for talent across many sectors, including the private sector, other CCAs, and both public and private utilities. Many middle and senior management level employees are highly specialized and have broad responsibility for multiple functions within CPA operations. To retain management-level (and equivalent) employees and to promote high performance, CPA has implemented a retention incentive program to incentivize employees to remain employed with CPA.
II. Overview
The CPA retention incentive program supports staff retention and high performance by:
• Budgeting for and setting aside each fiscal year an additional cash payment comprised of fixed and contingent amounts (the “Retention Incentive”) that eligible employees could earn at the end of a Waiting Period in addition to their regular salary. • Providing the Retention Incentive as a cash payment, less applicable withholdings and taxes, to “Eligible Employees” who remain employed with CPA at the end of a multi-year “Waiting Period”, thus triggering an “Earn Out Date”.
• Making a portion of the Retention Incentive a “Contingent Amount” payable upon certain “Organizational Performance Metrics” being met during a “Performance Period”.
III. Definitions
A. Contingent Amount – One of the two parts of the Retention Incentive. The Contingent Amount is a percentage that is earned when specific Organizational Performance Metrics are achieved during the relevant Performance Period.
B. Earn Out Date – The last day of the Waiting Period, when eligible employees earn their Retention Incentive.
C. Eligible Employees – Full-time executive, management track-level, and Professional/Technical Level 51 employees who remain employed by Clean Power Alliance on the Earn Out Date and are not subject to written disciplinary action or on a performance improvement plan at any point during the Waiting Period.
D. Fixed Amount – One of the two parts of the Retention Incentive. The Fixed Amount is earned at the relevant Earn Out Date and not dependent on achievement of Organizational Performance Metrics.
E. Organizational Performance Metrics – Metrics used to calculate the Contingent Amount of the Retention Incentive as specified in Section IV.A.1-3.
F. Pay Out Date – The pay cycle in which earned Retention Incentive is paid to the Eligible Employee.
G. Performance Period – The time within the Waiting Period in which the Organizational Performance Metrics are measured.
H. Retention Incentive – A cash payment budgeted for and set aside that eligible employees could earn in addition to their regular salary at a later date. Retention 1 Professional/Technical Level 5 is CPA’s highest category of non-management or individual contributor employees and with experience equivalent to or greater than management track-level employees.
Agenda Page 42
Incentive consists of the (1) Fixed Amount and (2) the Contingent Amount. Applicable withholdings and taxes will be deducted from the cash payment made on the Earn Out Date.
I. Waiting Period - A multi-year period that begins July 1, which includes the Performance Period and additional year(s) following the end of the Performance Period.
IV. Retention Incentive Description
At the beginning of each fiscal year, CPA sets aside funds equivalent to a percentage of each eligible employee’s salary as of June 30th (the end of the prior fiscal year) as a Retention Incentive. Eligible Employees that begin employment after July 1st (the start of then-current fiscal year) or are promoted to an eligible position will have their Retention Incentive prorated according to the number of full months of employment within the Performance Period. A portion of the Retention Incentive will be fixed (the Fixed Amount), and a portion will be based on achieving Organization Performance Metrics during the Performance Period (the Contingent Amount), as described below. Continuation of the retention incentive program year to year is dependent on budget approval by CPA’s Board of Directors.
Retention Incentives will be earned by Eligible Employees who remain employed with CPA on the Earn Out Date. Organizational Performance Metrics will be measured at the end of the Performance Period to determine the Contingent Amount that any employee may earn. For example, as depicted in the chart below, a Retention Incentive set aside on July 1, 2023, would be earned on June 30, 2025.
A. Organizational Performance Metrics
Earning the Contingent Amount depends on achieving certain Organizational Performance Metrics during the Performance Period. The Organizational Performance Metrics are:
1. Financial Performance: Achieving and/or maintaining an Investment Grade credit rating during the Performance Period.
2. Renewable Energy Procurement: Achievement of the target renewable energy procurement levels for each of CPA’s rate products in effect as of July 1 of the calendar year of the Performance Period.
3. Participation Rate: Achieving a customer Participation Rate in the last week of the Performance Period that is no less than 1% below the Participation Rate in the first week of the Performance Period.
Each of the Organizational Performance Metrics accounts for a portion of the Contingent Amount. For example, in the case where CPA sets aside a Retention Incentive of $20,000 for
Agenda Page 43
an Eligible Employee with a salary of $100,000 and each Organizational Performance Metric represents a Contingent Amount of 10%, the employee will earn a Fixed Amount of $14,000 if they remain employed as of the Earn Out Date and an additional $2,000 for each of the Organizational Performance Metrics that are achieved during the Performance Period provided the conditions outlined in this Policy are met.
V. Fiscal Year 2023/24 Parameters
1. Retention Incentive: up to 20% of an eligible employee’s salary as of June 30, 2023, or for new employees whose employment starts on or after July 1, 2023, the amount is prorated according to the number of full months of employment within the Performance Period. The Retention Incentive consists of both of the following:
a. Fixed Amount: up to 70% of the Retention Incentive amount b. Contingent Amount: up to 30% of the Retention Incentive amount; 10% for each Organizational Performance Metric.
2. Waiting Period: Two years from July 1, 2023
3. Earn Out Date: June 30, 2025
4. Performance Period: July 1, 2023 to June 30, 2024
The Parameters established in this Section V will apply in future Fiscal Years unless altered by the Board of Directors.
VI. Termination of Employment
If an employee voluntarily terminates employment at any time during the Waiting Period or is involuntarily terminated for cause before the Earn Out Date, the Retention Incentive amount is not earned. No pro rata portion of the Retention Incentive (including the Contingent Amount) will be earned by the employee.
If an involuntary termination not for cause (e.g., death, disability) occurs during the Waiting Period and not past the Earn Out Date, then the employee may earn any amount of the Incentive Retention calculated after the Performance Period. Such amount will be paid on the final paycheck made payable to the employee or their designated beneficiary in accordance with the Company’s then-current payroll practices. If involuntary termination not for cause (i.e., death, disability) occurs within a Performance Period, the Retention Incentive will be earned in a prorated amount from July 1 to the involuntary termination date. Such amount will be paid on the final paycheck made payable to the employee or their designated beneficiary in accordance with the Company’s then-current payroll practices.
VII. Interest, Taxes, and Conditions
The Retention Incentive is only earned by Eligible Employees as set forth in this Policy on the Earn Out Date. As a result, Eligible Employees will not earn interest on the budgeted and set-aside Retention Incentives during the Waiting Period.
Retention Incentives are taxable income to the employee and will be added to the employee’s compensation in the calendar year corresponding to the Pay Out Date. Employees are encouraged to seek advice from a tax professional.
Agenda Page 44
Retention Incentives are not portable to other employers or agencies.
The Retention Incentive program may be altered, limited, restricted, or terminated at any time with Board action to adjust to changing labor market conditions, internal staffing goals, overall compensation approaches, CPA’s fiscal health, or other considerations. Nothing in this program creates an expectation of employment or modifies the at-will nature of an Eligible Employee’s employment.
The Retention Incentive program is conditioned upon sufficient appropriation of funds by the Board. If the Board does not appropriate sufficient funds for this program, this Program may be terminated or reduced to reflect any reduction in funding.
VIII. Severability
If any section, subsection, sentence, or clause of this Policy is determined to be illegal, invalid, or unenforceable, such illegality, invalidity, or unenforceability shall not affect the legality, validity, or enforceability of this Policy as a whole or of any section, subsection, sentence, or clause herein that is not so determined.
Agenda Page 45
Staff Report – Agenda Item 7
To: Board of Directors
From: Gabby Monzon, Clerk of the Board
Approved By: Ted Bardacke, Chief Executive Officer
Subject: 2026 Meeting Schedule
Date: December 4, 2025
RECOMMENDATION
Receive and file the Board of Directors and Standing Committee meeting schedule for 2026.
BACKGROUND
The 2026 Board of Directors and Standing Committees meeting schedule will follow CPA’s current monthly meeting cadence. In total, CPA is slated to hold approximately 67 meetings in 2026 that are subject to the Brown Act:
• Board of Directors, 1st Thursday, 2:00 p.m.
• Executive Committee, 3rd Thursday, 1:30 p.m.
• Legislative & Regulatory Committee, 4th Wednesday, 10:00 a.m. • Finance Committee, 4th Wednesday, 11:00 a.m.
• Energy Planning & Resources Committee, 4th Wednesday, 12:15 p.m. • Community Advisory Committee, 3rd Thursday, 10:00 a.m.
The meeting schedule is regularly updated and posted on the Clean Power Alliance website: www.cleanpoweralliance.org/agendas.
ATTACHMENT
1. 2026 Meeting Schedule
Agenda Page 46
CLEAN POWER ALLIANCE OF SOUTHERN CALIFORNIA
2026 MEETING SCHEDULE
This schedule is updated regularly. Please check our website at www.cleanpoweralliance.org to view the most up-to-date version.
This calendar is updated regularly. Red Font indicates a new meeting date. Agendas are available at www.cleanpoweralliance.org/agendas at least 72 hours prior to the meeting. For questions, contact the Clerk of the Board at [email protected] or 213-713-5995. Last updated: December 4, 2025
STANDING MEETINGS JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC Board of Directors
2:00 PM, 1st Thursday 15* 5 5 2 14** 4 2 DARK 3 1 5 3
In-Person: Clean Power Alliance Office – Downtown LA
Board Meeting
Locations
Remote: Ventura County Hall of Administration, City of Calabasas, City of Whittier, Torrance at South Bay Cities COG *This date falls outside of the regular meeting cadence due to the holiday season. **This date falls outside of the regular meeting cadence to accommodate those attending the SCAG General Assembly.
Executive Committee
1:30 PM, 3rd Thursday 15 19 19 16 21 18 16 20 17 15 19 17 In-Person: Clean Power Alliance Office – Downtown LA
Meeting Locations
Remote: Varies depending on the composition of the Committee.
Community Advisory
Committee
10:00 AM, 3rd Thursday
15 19 19 16 21 18 16 20 17 15 19 17
In-Person: Clean Power Alliance Office – Downtown LA Meeting Locations Remote: Ventura County Hall of Administration, South Bay Cities COG Office Legislative & Regulatory
Committee
10:00 AM, 4th Wednesday
28 25 25 22 27 24 22 26 23 28 18 DARK
Finance Committee
11:00 AM, 4th Wednesday 28 25 25 22 27 24 22 26 23 28 18 DARK Energy Planning &
Resources Committee
12:15 PM, 4th Wednesday
28 25 25 22 27 24 22 26 23 28 DARK 16
In-Person: Clean Power Alliance Office – Downtown LA
Meeting Locations
Remote: Varies, please refer to posted meeting agendas for locations.
Agenda Page 47
Staff Report – Agenda Item 8
To: Board of Directors
From: David McNeil, Chief Financial Officer
Approved By: Ted Bardacke, Chief Executive Officer
Subject: Receive and File FY 2025/2026 Q1 Financial Report Date: December 4, 2025
RECOMMENDATION
Receive and file.
ATTACHMENT
1. FY 2025/26 Q1 Financial Report
Agenda Page 48
Summary of Financial Results
Definitions:
Accounts: Active Accounts represents customer accounts of active customers served by CPA per Calpine Invoice Participation Rate %: Participation Rate represents active accounts divided by eligible CPA accounts YTD Sales Volume: Year-to-date sales volume represents the amount of energy (in gigawatt hours) sold to retail customers Revenues: Retail energy sales and other (grant related) revenues less allowance for doubtful accounts Cost of energy: Includes all direct power costs incurred to serve CPA’s load Operating expenses: Includes general, administrative, consulting, payroll, and other costs required to fund operations Operating Income: Represents the difference between revenues and cost of energy and operating expenses Non-Operating Income: Interest income arising from deposits and investments net of borrowing costs and fees Investments: Liquid and high-quality securities with maturities of 91 days or more Cash and Cash Equivalents: Includes bank deposits and high quality and liquid securities with maturities of 90 days or less Year to date (YTD): Represents the fiscal period beginning July 1, 2025 YTD
September
2025
Financial Dashboard
Note: Numbers may not sum up due to rounding.
Active Accounts
1,041,066
Participation Rate
92.8%
YTD Sales Volume
3,078 GWh
September Volume
1,033GWh
Res
50%
Com - Lg
20%
Com - Sm
28%
Agr/Oth
2%
In September 2025, CPA’s net position increased by $2.0 million, $12.4 million more than the budgeted decrease in net position of $10.4 million. This positive outcome was driven by lower than budgeted energy costs resulting from the non-utilization of contingency funds for the month.
For the first quarter of the fiscal year (Q1), CPA posted an increase in net position of $16.5 million, $36.6 million higher than the budgeted decrease of $20.2 million. Q1 revenues totaled $404.1 million, 2% less than budgeted, due to the mild weather experienced this quarter. The YTD cost of energy was $379.6 million, 9% under budget, driven by both the non-utilization of contingencies, and mild weather which resulted in lower than budgeted energy market prices. Absent contingencies, energy costs were $10.5 million, 2.7% below budget. CPA budgets higher energy contingencies in the summer months due to historically volatile weather in that season. Operating expenses totaled $14.0 million, $4.5 million (24%) less than budgeted mainly from lower than projected spending on staffing, customer programs, communications, and administrative expenses. Non-operating income, driven primarily by interest earnings, was $6.0 million, 12% above budget.
As of September 30th, 2025, CPA had unrestricted cash, cash equivalents, and current investments of $372.0 million, as well as $114.0 million available in its bank line of credit, representing 216 Days Liquidity on Hand. CPA is financially sound and in compliance with its bank and other credit covenants.
Agenda Page 49
2025 2024
ASSETS
Current assets
Cash and cash equivalents $ 321,959,653 $ 415,364,739
Investments 50,000,000 50,001,000
Accounts receivable, net of allowance 152,783,236 194,134,580 Accrued revenue 78,885,593 95,689,500
Other receivables 19,215,408 25,755,326
Interest receivable 2,917,766 1,928,495
Prepaid expenses 3,141,917 7,336,589
Deposits 5,061,787 5,985,219
Total current assets 633,965,361 796,195,447
Noncurrent assets
Capital assets, net of depreciation and amortization 1,646,322 2,226,407 Deposits 88,875 88,875
Investments 200,314,879 -
Total noncurrent assets 202,050,076 2,315,282
Total assets 836,015,437 $ 798,510,729
LIABILITIES
Current liabilities
Accounts payable 3,377,656 2,949,549 $
Accrued cost of electricity 186,432,481 349,762,082
Other accrued liabilities 7,293,072 4,764,203
User taxes and energy surcharges due to other governments 13,434,659 15,312,311 Security deposits from energy suppliers 43,350 964,500
Unearned program funds 5,107,807 3,974,242
Lease liability, current 458,142 433,075
Total current liabilities 216,147,168 378,159,962
Noncurrent liabilities
Security deposits from energy suppliers 2,366,852 3,146,852 Lease liability, noncurrent 1,259,949 1,718,091
Other noncurrent liabilities 193,922 148,849
Total noncurrent liabilities 3,820,723 5,013,792
Total liabilities 219,967,890 $ 383,173,754 $
DEFERRED INFLOWS OF RESOURCES
Fiscal stabilization fund 135,000,000 135,000,000
NET POSITION
Investment in capital assets (71,769) $ 75,241 $
Unrestricted 481,119,316 280,261,734
Total net position 481,047,547 $ 280,336,975 $
CLEAN POWER ALLIANCE OF SOUTHERN CALIFORNIA
STATEMENT OF NET POSITION
AS OF SEPTEMBER 30, 2025 AND 2024
Agenda Page 50
2025 2024
OPERATING REVENUES
Electricity sales for resale, net 403,320,709 512,595,843 Other revenue 780,173 492,741
Total operating revenues 404,100,882 513,088,585
OPERATING EXPENSES
Cost of electricity 379,579,785 553,270,787
Contract services 7,096,030 5,751,340
Staff compensation 6,063,094 5,127,402
General and administration 866,674 792,412
Total operating expenses 393,605,584 564,941,941
Operating income 10,495,298 (51,853,357)
NONOPERATING REVENUES (EXPENSES)
Interest and investment income 6,122,663 4,691,237
Interest and financing expenses (125,596) (155,138)
Total nonoperating revenues 5,997,067 4,536,100
CHANGE IN NET POSITION 16,492,365 (47,317,257)
Net position at beginning of period 464,555,182 327,654,232 Net position at end of period $ 481,047,547 $ 280,336,975
CLEAN POWER ALLIANCE OF SOUTHERN CALIFORNIA
STATEMENT OF REVENUES, EXPENSES
AND CHANGES IN NET POSITION
FOR THREE MONTHS ENDED SEPTEMBER 30, 2025 AND 2024
Agenda Page 51
2025 2024
RECONCILIATION OF OPERATING INCOME TO NET
CASH PROVIDED (USED) BY OPERATING ACTIVITIES
Net operating income (loss) $ 10,495,298 $ (51,853,357) Adjustments to reconcile operating income to net
cash provided (used) by operating activities
Depreciation expense 33,717 43,774
Amortization expense 101,590 119,727
Revenue adjusted for allowance for uncollectible accounts 3,090,521 7,338,466 (Increase) decrease in:
Accounts receivable (58,568,975) (58,305,340)
Other receivables (9,073,407) (14,252,384)
Accrued revenue (5,536,506) (471,635)
Prepaid expenses 2,821,058 83,956,329
Deposits 2,867,463 (3,653,800)
Increase (decrease) in:
Accounts payable 122,804 (96,352)
Energy market settlements payable (3,305,187) (6,604,014) Accrued cost of electricity 82,016,739 109,496,145
Other accrued liabilities (2,420,862) 740,557
User taxes due to other governments 2,741,818 4,561,438 Supplier security deposits (136,650) (2,997,000)
Unearned program funds 258,202 (80,431)
Net cash provided by operating activities $ 25,507,623 $ 67,942,122
CASH FLOWS FROM NON-CAPITAL FINANCING ACTIVITIES
Interest and related expense payments (126,782) (134,579) Net cash used by non-capital financing activities (126,782) (134,579)
CASH FLOWS FROM CAPITAL AND RELATED
FINANCING ACTIVITIES
Payments to acquire capital assets 1,105 -
Payments on lease (for both principal and interest) (121,774) (118,227) Net cash used by capital and related financing activities (120,669) (118,227)
CASH FLOWS FROM INVESTING ACTIVITIES
Purchased of investments (5,517,648) 9,999,000
Interest income received 4,982,550 4,167,002
Net cash provided (used) by investing activities (535,098) 14,166,002 Net change in cash and cash equivalents 24,725,074 81,855,318 Cash and cash equivalents at beginning of period 297,234,579 333,509,421 Cash and cash equivalents at end of period $ 321,959,653 $ 415,364,739 Reconciliation to the Statement of Net Position
Cash and cash equivalents (unrestricted) 321,959,653 415,364,739
CLEAN POWER ALLIANCE OF SOUTHERN CALIFORNIA
STATEMENT OF CASH FLOWS
FOR THREE MONTHS ENDED SEPTEMBER 30, 2025 AND 2024
Agenda Page 52
2025/26 YTD
Budget
2025/26 YTD
Actual
2025/26 YTD
Budget Variance
(Under) Over
2025/26 YTD
Actual / Budget
% 2025/26 Budget
2025/26
Remaining
Budget
2025/26
Remaining
Budget %
Operating revenues
Revenue - electricity, net $ 409,384,857 $ 403,320,709 $ (6,064,148) 99% 1,319,740,816 $ $ 916,420,107 69% Other revenues 1,168,848 780,173 (388,675) 67% 4,514,184 3,734,011 83% Total operating revenues 410,553,705 404,100,882 (6,452,823) 98% 1,324,255,000 920,154,118 69% Energy costs
Energy procurement 379,579,785 417,523,377 (37,943,592) 91% 1,207,444,000 827,864,215 69% Total energy costs 417,523,377 379,579,785 (37,943,592) 91% 1,207,444,000 827,864,215 69% Operating revenues less energy costs 24,521,097 (6,969,672) 31,490,769 - 116,811,000 92,289,903 79% Operating Expenditures
Staffing 6,664,590 6,063,094 (601,496) 91% 27,846,000 21,782,906 78% Technical services 590,535 405,175 (185,360) 69% 2,465,000 2,059,825 84% Legal services 397,390 128,206 (269,184) 32% 1,542,000 1,413,794 92% Other professional services 750,444 376,608 (373,836) 50% 2,802,000 2,425,392 87% Communications and outreach 1,478,000 999,197 (478,803) 68% 6,079,000 5,079,803 84% Mailers 421,050 437,554 16,504 104% 1,425,000 987,446 69% Billing data manager 2,980,290 2,893,519 (86,771) 97% 12,279,000 9,385,481 76% SCE services 589,966 550,933 (39,033) 93% 2,404,000 1,853,067 77% Customer programs 3,324,010 1,304,839 (2,019,171) 39% 14,425,000 13,120,161 91% General and administrations 1,315,849 866,674 (449,175) 66% 5,836,000 4,969,326 85% Total operating expenditures 18,512,124 14,025,799 (4,486,325) 76% 77,103,000 63,077,201 82% Operating income 10,495,298 (25,481,796) 35,977,094 - 39,708,000 29,212,702 74% Non-operating revenues (expenditures)
Interest income 6,123,610 6,122,663 (947) 100% 26,568,000 20,445,337 77% Finance and interest expense (790,981) (125,596) 665,385 16% (1,176,000) (1,050,404) 89% Total non-operating revenues (expenditures) 5,332,629 5,997,067 664,438 112% 25,392,000 19,394,933 76% Change in net position 16,492,365 (20,149,167) 36,641,532 - 65,100,000 48,607,635 75% Other uses Capital outlay 84,497 (1,105) (85,602) - 338,000 339,105 100% Depreciation and Amortization (168,890) (135,307) 33,583 80% (617,000) (481,693) 78% Total other uses (84,393) (136,412) (52,019) 162% (279,000) (142,588) 51% Change in fund balance $ 16,628,777 (20,064,774) $ 36,693,551 $ - 65,379,000 $ 48,750,223 $ 75%
CLEAN POWER ALLIANCE OF SOUTHERN CALIFORNIA
BUDGETARY COMPARISON SCHEDULE
FOR THREE MONTHS ENDED SEPTEMBER 30, 2025
Agenda Page 53
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Agenda Page 54
Staff Report – Agenda Item 9
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 July 1, 2025 through September 30, 2025 (Q3 2025)
Date: December 4, 2025
RECOMMENDATION
Receive and file.
ATTACHMENT
1. RMT Quarterly Report
Agenda Page 55
Quarterly Report of Risk Management Team
July 1, 2025 through September 30, 2025 (Q3 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 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 2025 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.
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 Counterparty Credit Protocol 1 The RMT is comprised of CPA’s Chief Executive Officer, Chief Operating Officer, Chief Financial Officer, and Vice President, Power Supply.
Agenda Page 56
document that describes the method for evaluating counterparties and establishing a credit limit was developed by CPA’s Chief Financial Officer and CPA’s former scheduling coordinator, The Energy Authority (TEA). The 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 being 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 in the process of 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 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 in production, 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).
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. CPA receives daily updates of counterparty credit exposures on both a notional and mark-to-market basis.
• 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
Agenda Page 57
on the prompt 12 months, while specific studies extend through calendar 2026 or beyond.
• 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.
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.
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.
Beginning in September 2025, the energy hedge
ratio for Q3 2028 exceeded the maximum hedge
percentage by 0.2% due to a reduction in forecast
load.
None.
The deviation will resolve itself on January 1st,
2026 when the maximum hedge percentage for
Q3 2028 increases.
There are no existing or potential violations of conflicts of interest or General Conduct to report for this quarterly period.
Agenda Page 58
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 and dry weather conditions throughout much of Q3 2025. Day ahead energy prices were lower than anticipated by forward prices resulting in lower costs to serve CPA’s customer load. Forward prices for energy deliveries in 2026 and beyond declined slightly over the quarter. Forward prices for resource adequacy and renewable energy for 2026 and beyond declined modestly.
Agenda Page 59
Staff Report – Agenda Item 10
To: Board of Directors
From: Joanne O’Neill, Senior Director, Customer Programs Reviewed By: Matthew Langer, Chief Operating Officer
Francis Choi, Assistant General Counsel
Approved By: Ted Bardacke, Chief Executive Officer
Subject: Member Agency Programs Quarterly Report
Date: December 4, 2025
RECOMMENDATION
Receive and file.
ATTACHMENT
1. Member Agency Programs Quarterly Report
Agenda Page 60
Board of Directors Item 10
Member Agency Programs Quarterly Report – Q4 2025
INTRODUCTION
This quarterly report provides overall program status, key accomplishments and challenges, and quarterly goals for two Clean Power Alliance (CPA) programs that directly support member agencies: the Power Ready and Energized Communities programs.
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.
POWER READY
Power Ready is a community benefit program offered to CPA’s member agencies and critical community sites. The program enhances energy and community resiliency by installing solar-plus-storage systems as a clean energy backup source that is available when a power outage occurs. Compared with typical solar and battery systems, the Power Ready program provides several unique offerings, including a guarantee that a portion of the battery will be available for planned and unplanned power outages for critical loads at facilities. CPA also guarantees that annual electricity charges for the site host will be equal to, or less than, the amount that would have otherwise been charged if they did not participate in the Power Ready program.
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 continued to seek interest from member agencies and critical community sites through November 2025.
Agenda Page 61
Board of Directors Item 10
Interested member agencies are encouraged to email
[email protected] to schedule a program overview meeting to learn more about the Power Ready program.
Eligible facilities include those that provide the continuation of a critical public service (emergency operations centers, police stations, fire stations, etc.), and those that serve as a place of refuge for the community (community centers, cooling centers, libraries, etc.). In Round 2, member agencies can also nominate a critical community site, which can include other public agencies, special districts, and/or non-profits within their communities that provide similar emergency services to the public. Examples of critical community facilities include public gathering spaces that partner with agencies during emergencies, school districts, public transit and water services, cooling centers, and other similar agency recommendations.
Key Accomplishments
Power Ready Round 1:
• All Site Lease Agreements between participating member agencies and Coast Energy have been fully executed. CPA staff thank all participating member agencies and their staff for achieving this significant milestone and are looking forward to moving into implementation.
• Coast Energy purchased the solar modules to “safe harbor” the equipment, which allows it to comply with the Investment Tax Credit requirements and retain federal incentives.
• Significant progress has been made for the four cities and participating facilities that were issued Notices to Proceed earlier this year (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:
o Finalizing engineering plans with reviews and approvals from the agencies, o Advancing SCE’s interconnection applications, and
Agenda Page 62
Board of Directors Item 10
o Preparing and submitting permitting packages to the Authorities Having Jurisdiction (AHJ).
• All BESS projects submitted incentive applications for the statewide Self Generation Incentive Program (SGIP) 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. CPA has enrolled as an aggregator under SCE’s Capacity Bidding Program Elect program in order to comply with SGIP requirements.
• On October 16, 2025, the Board approved amendments to select Power Ready project PPAs due to changes in financial conditions since the PPA was originally approved, and schedule delays. With this approval, projects have moved into 10% engineering design with Los Angeles County – Libraries within Claremont, Hacienda Heights, and Paramount, Ventura County – Oak View Resource Center and Simi Valley Fire Station, and Westlake Village – Civic Center Complex. • All projects expect to be operational in Q4 2026.
Power Ready Round 2:
• To date, significant interest among member agencies and community sites has resulted in the submission of over 65 member agency and community sites for consideration.
• Of those sites submitted, 24 facilities have been assessed for technical feasibility, and the technical consultant has performed on-site assessments to field-verify meter numbers, electrical configurations, viable locations for solar and battery systems, end-use equipment that plan to receive backup power, existing backup generators, and other pertinent information. Draft reports and presentations are planned to be shared throughout Q4 2025 and Q1 2026 for site hosts to provide feedback on the technical consultant’s reports. Additional sites are still in the early stages of assessments and will follow the screening process as described above. • During the CPA Board Retreat on September 26, 2025, CPA staff received feedback on several aspects of the Power Ready Round 2 program that will be incorporated and/or reviewed at a later date with the Board once further due
Agenda Page 63
Board of Directors Item 10
diligence is performed. This includes the possibility of CPA owning the Power Ready Round 2 assets.
Challenges and Risks
• CPA and Coast Energy will monitor progress and assist with permitting reviews and interconnection application approvals where feasible and intervene as necessary to meet project completion timelines.
• Coast Energy and CPA are actively tracking Investment Tax Credit changes and their potential impact on projects, particularly the new Foreign Entity of Concern (FEOC) mandate.
Goals for the Next Quarter
• Finalize engineering schematics, submit permit packages to AHJs, receive interconnection approvals, and secure long-lead equipment items. • CPA staff and technical consultants will review site submissions for Round 2 to evaluate their technical feasibility. This will result in an initial shortlist of viable sites to advance.
Agenda Page 64
Board of Directors Item 10
Key: Black X = Selected
Black check marks = complete
Grey check marks = incomplete
Power Ready Round 1 Project Status Summary: (as of November 20, 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 65
Board of Directors Item 10
ENERGIZED COMMUNITIES
Energized Communities is a $10 million commitment of funds and technical assistance offered through 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. Energized Communities program objectives and general enrollment are summarized in the table below. Project status for each member agency is provided in the Innovation Fund and Pathways to Electrification tables following this quarterly report.
Pathways to Electrification Innovation Fund Energized
Communities
Program
Building
Electrification
Assistance
Electric Fleet
Transition
Community EV
Charging Round 1
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 12 3 4
Key Accomplishments
Outreach and engagement of member agencies include:
• All thirty-eight (38) 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 since the program was launched in April 2024. Some agencies have indicated their inability to move forward at this time for the reasons noted in the "Challenges” section below. • Four (4) additional agencies have enrolled in the Pathways to Electrification program in the previous quarter, for a total of nineteen (19) member agencies
Agenda Page 66
Board of Directors Item 10
to date. Nine additional agencies are currently reviewing the Pathways to Electrification participation agreements.
▪ The first Energized Communities Electric Fleet Transition project was completed and CPA provided $250,000 in funding to support the purchase of four F-150 Ford Lightnings for the City of Camarillo. ▪ One (1) additional agency enrolled in the Community EV Charging pathway this quarter, for a total of three (3) member agencies since the opportunity launched in August.
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. The City of Oxnard subsequently elected not to move forward, and the previously allocated $250,000 in project funding was rolled over to Round 2. The remaining participants are in various stages of implementation with the City of Carson launching its EV Charging Wallet program on October 1st and the City of Santa Monica preparing to launch their program to provide electric equipment to renters. CPA brought on a CivicSpark Fellow to assist with implementation of the Innovation Fund programming.
• Round 2: The second funding opportunity with a budget of $1,250,000 opened on August 25th and closed on October 8, 2025. 14 applications were received for a total budget request of $3,412,383 to fund projects across CPA’s service area. A review team comprised of CPA’s Community Advisory Committee members and CPA staff reviewed the project submissions.
Recommendations were shared with CPA’s Executive Committee on November 20th and are included for approval at the December 2025 Board meeting.
Challenges and Risks
The member agencies’ internal process to select a Pathways to Electrification program and approve the corresponding Participation Agreement remains lengthy,
Agenda Page 67
Board of Directors Item 10
leading to later than desired start dates for some projects. Similar delays in approving the Innovation Fund participation 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 California Edison (SCE). SCE has a lengthy project implementation queue, which could add to the scheduled timeline of CPA-funded projects.
Goals for the Next Quarter
CPA continues to engage with member agencies who have not selected an Energized Communities pathway.
The recommended projects for Round 2 of the Innovation Fund are provided to the Board of Directors for approval as part of this December meeting agenda. If approved, CPA staff will coordinate with each agency to finalize participation agreements and launch the Round 2 projects.
Due to the level of interest in community-wide resilience projects, CPA staff will consult with the agencies that submitted these projects to the Innovation Fund and gather input to design a Round 3 funding opportunity that support community-wide resilience.
Agenda Page 68
Board of Directors Item 10
Key: Black X = Selected
Black check marks = complete
Grey check marks = incomplete
CPA Innovation Fund Round 1 Program Status: (as of November 20, 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 Agency is not moving forward
Santa Monica Renters’ Energy and
Cooling/Heating (REACH) Program ✓ ✓ ✓
West Hollywood Equitable Building Performance
Standards and Benchmarking Support ✓ ✓ ✓
Agenda Page 69
Board of Directors Item 10
Key: Black X = Selected
Black check marks = complete
Grey check marks = incomplete
CPA Energized Communities Project Status Summary (page 1): (as of November 20, 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 70
Board of Directors Item 10
Key: Black X = Selected
Black check marks = complete
Grey check marks = incomplete
CPA Energized Communities Project Status Summary (page 2): (as of November 20, 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 71
Board of Directors Item 10
Key: Black X = Selected
Black check marks = complete
Grey check marks = incomplete
CPA Energized Communities Project Status Summary (page 3): (as of November 20, 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 ✓ ✓ ✓ ✓ ✓
Whittier x ✓ ✓ ✓ ✓ ✓
Agenda Page 72
Staff Report – Agenda Item 11
To: Board of Directors
From: Cara Rene, Director, Communications & Marketing
Approved By: Ted Bardacke, Chief Executive Officer
Subject: Receive and File Quarterly Communications Update Date: December 4, 2025
RECOMMENDATION
Receive and file.
ATTACHMENT
1. Quarterly Communications Update
Agenda Page 73
Communications & Marketing
Community Engagement
Quarterly Update
August through October 2025
Plus, a look ahead
December 4, 2025
Agenda Page 74
What we’re excited about
Clean Power Alliance is the official sponsor of the EV test track at the 2025 LA Auto Show from November 21-30, promoting CPA and the EV SmartCharge program.
Introduced the Program Finder on CPA’s interactive programs webpage, which offers customized program recommendations to customers based on their responses to a set of questions.
Launched a highly targeted email and social campaign to encourage high -energy-use commercial customers to enroll in Power Response: Commercial Leaders.
Received a record 70 applications for the annual Community Benefits Grant; a 40% percent increase over last year. Recipients to be announced in late 2025.
Promoted the value of CPA programs to new customers in Lynwood, La Cañada Flintridge, and Port Hueneme.
Agenda Page 75
2 Expansion Communications
Post-enrollment communications are underway to new customers in the cities of Lynwood, La Cañada Flintridge and Port Hueneme following the transition to CPA electricity service in October. Customers received their first post-enrollment notification in early November, and the final notification will be mailed in early December. Outreach communications provide clear information about how to opt out of CPA or select a different energy option if they choose.
Social media
Downloadable fact sheets Customers notifications are mailed August, September, November and December.
Agenda Page 76
Program Awareness Campaign
CPA launched a program awareness campaign from June through November—aligning with peak program recruitment season—to deepen customer understanding of the many programs available.
Strategic approach:
Reached both residents and businesses online through
digital marketing with timely, actionable program
information.
Targeted Spanish speaking audiences via trusted
Spanish-language station KLVE to grow awareness and
reinforce campaign messaging.
A bus wrap provided high-visibility, community-based
exposure throughout LA County, extending campaign.
Outcomes:
9.3M impressions
37,400 website views
Bus wrap
New interactive program webpage
Digital
Agenda Page 77
Marketing update: Instant AC Savings
10 CPA promoted the Instant AC Savings program, which provides income-qualified residents with coupons to purchase energy-efficient air conditioners. Outreach used hyper-local, culturally resonant channels to reach heat-impacted households, increasing program awareness and fostering trust.
Strategic Approach:
Geotargeted Meta ads around LA County and Ventura County cooling centers, laundromats, and bus routes in high-heat zones.
Strong engagement from Spanish- and Chinese-speaking audiences drove increased investment in Meta content for these customers.
Promoted the program through LA Galaxy’s community activation to reach and engage local audiences, and particularly Spanish-speaking audiences.
Introduced LA County and Ventura County co-branding into creative and launched reminder emails to boost coupon redemption.
Outcomes:
30,726 website visitors
1,321 leads
571 coupons reserved (698 total since launch)
Reminder email
Digital
Agenda Page 78
Marketing Update: EV SmartCharge
To continue to boost awareness and enrollment in the EV SmartCharge program, CPA continued a multi-channel approach highlighting how customers can “enroll and earn money" for EV charging at home.
Strategic Approach:
New ads on public EV chargers were placed in areas where customers are likely to charge away from home.
Meta ads were optimized to adjust the audience based on research into program participants and EV owners.
Continued radio and digital billboard advertising to maintain visibility, while search engine marketing targeted customers actively seeking program information.
Outcomes:
20,807 website visits via ads and direct mail
716 new users acquired
Email
EV charger
ads
Agenda Page 79
Marketing Update: Sun Storage Rebate
CPA’s Sun Storage Rebate campaign emphasized home battery systems as a way to "create and store electricity.“ CPA promoted the program using advertisements and direct mail, reinforcing digital outreach with a physical reminder that increases recall and response.
Strategic Approach:
Framed solar storage as a lifestyle and security investment instead of a technical upgrade.
Integrated Meta, podcast, and search ads with direct mail to reinforce awareness across both digital and physical
touchpoints.
Targeted households inside communities that have the highest amount of battery adoption and home ownership.
Outcomes:
17,505 website visits via ads and direct mail
Meta
Postcard
Agenda Page 80
Marketing update: Power Response Smart Home
Marketing ramped up throughout the summer, highlighting the effect that program participants' actions have on the power grid. Outreach prioritized a multi-channel approach to reinforce awareness and engagement, targeted diverse customer segments, and integrated joint program marketing efforts to maximize CPA's program awareness.
Strategic Approach:
Email drip campaign highlighted the program's different benefits to appeal to customers' varying motivations (such as earning money, impacting the environment) and motivate them to enroll.
Integrated social media, display, and search engine ads as a three-prong digital approach in driving traffic to the Smart Home webpage.
Promoted free smart thermostat offering through LA Galaxy’s community activation to reach and engage local
customers, particularly Spanish-speaking community.
Outcomes:
10,274 website visits via paid media and emails Email
Agenda Page 81
Marketing update: Power Response Home
To meet customers where they are, marketing for Power
Response Home focused on streamlining the enrollment
process for customers. CPA also tested new tactics such as streaming TV (Peacock) to increase awareness of the
program.
Strategic Approach:
Direct mailers were a highly effective marketing tactic in enrolling customers. These were sent on a monthly
cadence and provided customers an alternative option
to enroll.
These mailers were assisted by a layered paid-media
approach that consisted of social media and search
engine marketing ads.
Email drip campaign reinforced the enrollment process
and motivated customers to take the last step.
Outcomes:
5,979 website visits via paid media and direct mail
Direct mail with an option to enroll
Agenda Page 82
Marketing update: Solar and Battery Access
10 Meta
The Solar and Battery Access program provides income-qualified residents a solar and battery system with no cost for equipment and installation. Outreach was targeted around low-income zip codes with higher rates of homeownership to reach eligible customers.
Strategy Approach:
Messaging was delivered through bus shelters and digital billboards in shopping centers and food courts within lower-income zip codes to reach key audiences and increase program awareness.
Awareness efforts were combined with direct-to-consumer tactics, including direct mail and emails, which successfully resulted in generating a high volume of leads.
With Spanish speakers making up 41% of engaged users, CPA continued high-performing in-language tactics in Meta, radio, and the LA Galaxy sponsorship to help grow awareness and strengthen connections with this key audience.
Outcomes:
22,138 website visitors
41 (144 total)solar and battery contracts signed
8 (20 total) battery only contracts signed
Bus shelter and
Digital billboards
Agenda Page 83
Marketing Update: Energy Team
CPA continued to promote and hone ad efforts for the Energy Team service. Strategic use of new messaging and advertising platforms drove a five-fold increase in Energy Team leads in September.
Strategic Approach:
Implemented two social media influencer to help expand reach and connect with audiences in a more relatable way. This approach attracted new website visitors who showed above-average engagement with the Energy Team website.
Streamed the Energy Team commercial on Netflix in
September, increasing impressions by 90%.
Sent customers an email in September that boosted direct web traffic and contributed to an increase in leads to the Energy Team.
Outcomes:
10,151 website visits via ads and direct mail
Social media
Energy Team commercial
Agenda Page 84
Marketing update: LA Galaxy Activation
CPA launched its first bilingual marketing activation at three LA Galaxy soccer games to cross-promote income-qualified programs and elevate overall brand awareness. The promotion highlighted Instant AC Savings, Solar and Battery Access, and Power Response Free Smart Thermostat programs. With more than 60% of attendees identifying as Spanish-speaking, CPA developed Spanish-language promotions across stadium assets, including the scoreboard, field boards, and CPA’s event booth.
CPA booth – stadium concourse
In-stadium billboards
Outcomes:
322 direct engagements with customers
3.8 million estimated impressions for the entirety
of the activation
Strategic Approach:
Extended campaign reach with Spanish-language radio
(KWKW, 9/15–10/18) to reinforce awareness before and
during the events.
Hosted a booth with Spanish-speaking representatives
to provide direct, culturally relevant engagement and
build trust with customers.
Agenda Page 85
Community Engagement
13 Staying active in LA and Ventura Counties
Participated in events, presentations and business
meetings including activities in each of CPA’s three
new communities
10 presentations with key stakeholders
including city councils, state elected officials,
community-based organizations and
neighborhood groups.
14 community events at street fairs, climate
awareness events, and community celebrations
allowed CPA staff and CAC members to
increase education and awareness about CPA.
5 meetings with business associations to share
program participation and relevant contracting
opportunities.
Engagements included: .
Held the second 2025 City Manager meeting, focused on federal impacts and program opportunities
Attended three back-to-school nights in the City of Lynwood to educate customers on the transition to CPA
Participated in the annual San Gabriel Valley Nonprofit Summit to highlight CPA’s grant opportunities
Community Engagement
Agenda Page 86
Earned Media Highlights
14 From August to October, Clean Power Alliance distributed two news releases. Those releases plus additional organic mentions garnered a global news coverage total of $2.19M in earned media value. Sentiment mostly positive or neutral.
Media Potential
Reach
Earned
Value
Exposure
Mentions
Print/Online 235M $2.19M 1,250
High-performing Media Outreach:
Investing in Local Communities: Clean Power Alliance Invites Applications for the 2025-26 Community Benefits Grant; audience reach of 43.8M, 6,220 views, 112 mentions
Clean Power Alliance Welcomes Three New Cities, Expanding Service to 38 Southern California Communities; audience reach of 43M, 6,030 views, 97 mentions
Notable Earned Media Mentions:
LAist: As heat death’s rise, LA County will soon require that landlords keep apartments cool; audience reach 15.5M
AP: Charge your car, not your wallet: City of Carson Launches EV Charging Wallet Pilot Program; audience reach 31.1M
Outlook Valley Sun: Clean Power Alliance CEO says transition will be smooth in La Cañada Flintridge; audience reach 14.7K Eco-Logic Podcast: Interview with CEO Ted Bardacke
Active Lab Podcast: Interview with CEO Ted Bardacke
Agenda Page 87
Our Instagram page had
3.2 million views, a
6.6% increase, 6.9k
profile visits
Added 1470 new
followers, a 39%
increase over the
previous quarter
Best performing post:
Energy Team post on
Aug. 5 with 1.8k views,
13k accounts reached
and 337 content
interactions
Our LinkedIn page had
6,172 page views, a 26.6%
increase and 2,291 unique
visitors, an 18% increase
with 322,327 impressions,
a 5.6% increase
Added 2,058 new
followers, an 86.4%
increase over the previous
quarter
Best performing post:
Community Benefits Grant
post, which had 96k
impressions and 563
engagements
Our Facebook page had
12.4 million views, reached
1.1 million accounts, had
30.4k content interactions, a
36.3% increase, and 76.3k
link clicks
Added 50 followers
Best performing post:
EV SmartCharge post on
Oct. 17, which had 24k
views, 3,868 interactions,
168 comments
Our X page averaged
3.5k impressions, with a
5.9% engagement rate
Gained 41 followers
Best performing post:
La Cañada Flintridge
joining CPA post on Oct.
9, which had 124
impressions and a 2.4%
engagement rate
Please share CPA’s messages through your social media channels! Social Media Highlights
Agenda Page 88
4 Website Performance
The CPA website recorded 286,463 page views, an 8.3% increase from last quarter. This steady growth reflects ongoing improvements in digital engagement and visibility across CPA’s key audiences. The increase was primarily driven by enhanced brand awareness initiatives, strategic program marketing campaigns, and seasonal interest in CPA’s program offerings. Together, these factors contributed to sustained audience interaction, greater reach, and a continued upward trend in overall website performance.
Top five visited webpages:
1. Homepage
2. EV SmartCharge
3. Programs
4. Instant AC Savings Program
5. Solar and Battery Access
Agenda Page 89
A Look Ahead
Post enrollment notifications to customers in our three new cities continue through December Launch of demand response survey to better understand commercial and residential customer awareness, attitudes, and preferences to strengthen program design and customer engagement strategies.
Updates to CPA's Time-of-Use webpage, including an interactive rate finder and introduction to TOU-SMART – the new rate that rewards customers with an electric vehicle, battery, or heat pump system for shifting energy use to daylight hours.
Distributing a survey to current Green Leaders to ascertain what aspects of the program bring them value and what should CPA consider doing to strengthen program participation Production of explainer video to tell the story of CPA and our impact in the region Development of the annual Impact Report to highlight CPA’s work in 2025 Agenda Page 90
Staff Report – Agenda Item 12
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: December 4, 2025
RECOMMENDATION
Receive and file.
MEETING REPORT
The Community Advisory Committee did not meet in November.
Agenda Page 91
Staff Report – Agenda Item 13
To: Board of Directors
From: Karen Schmidt, Senior Director, Rates & Strategy
Reviewed by: Matthew Langer, Chief Operating Officer
Nancy Whang, General Counsel
Approved By: Ted Bardacke, Chief Executive Officer
Subject: Public Hearing: Consider Adoption of Resolution No. 25-12-098 to Approve Addendum No. 6 to the Clean Power Alliance
Implementation Plan adding the cities of Cudahy and Fillmore as members of Clean Power Alliance, and to Authorize Staff to Submit Addendum to the California Public Utilities Commission
Date: December 4, 2025
RECOMMENDATION
Conduct a public hearing to consider adoption of Resolution No. 25-12-098 (Attachment 1) to approve Addendum No. 6 (Attachment 2) adding the cities of Cudahy and Fillmore as members of Clean Power Alliance and to authorize staff to submit Addendum No. 6 as attached, or in a substantially similar form, to the California Public Utilities Commission on or before December 31, 2025.
BACKGROUND
The Board adopted its original Implementation Plan on August 4, 2017, at which time the organization included three members: Los Angeles County, Rolling Hills Estates, and South Pasadena. On December 17, 2017, the Board adopted Implementation Plan Addendum No. 1, adding 21 additional cities, and on March 1, 2018, the Board adopted Addendum No. 2, adding 7 additional cities. On December 13, 2018, the Board adopted Implementation Plan Addendum No. 3, adding one additional city. On December 1, 2022, the Board adopted Implementation Plan Addendum No. 4, adding three additional cities.
Agenda Page 92
Board of Directors Item 13
On December 7, 2023, the Board adopted Implementation Plan Addendum No. 5, adding an additional three cities, bringing the total membership of CPA to its current 38 jurisdictions.
The Board voted on September 4, 2025, to invite Cudahy and Fillmore to join CPA. Cudahy adopted its ordinance to join CPA on October 21, 2025, and Fillmore adopted its ordinance to join CPA on October 28, 2025. Pursuant to CPUC regulations, a resolution approving Addendum No. 6 must be adopted by the Board and filed with the CPUC by December 31, 2025 in order for CPA to begin serving load to customers in these cities in 2025. The two cities collectively will add approximately 11,300 customers and increase total load (kWh) by approximately 0.9%.
DISCUSSION
Addendum No. 6 to CPA’s Implementation Plan is a document required by the California Public Utilities Commission (CPUC) for CPA to provide energy service to new member communities.
Addendum No. 6 updates CPA’s forecasted load, capacity requirements, Renewable Portfolio Standard (RPS) requirements, and operating results to reflect the anticipated impacts of the planned expansion to the new member agencies as well as the most recent historical energy use within CPA’s service territory. It sets October 2027 as the proposed implementation date when service to customers in the new member communities would begin.
Upon Board approval of Resolution 25-12-098, the new member agencies will sign CPA’s Joint Powers Agreement (JPA) in December 2025 and their signature pages will be added to the appendices of Addendum No. 6 prior to its submission to the CPUC. The new members will be officially admitted to the JPA after the CPUC’s certification of and issuance, if any, of findings on Addendum No. 6 to the Implementation Plan.
Agenda Page 93
Board of Directors Item 13
ATTACHMENTS
1. Resolution No. 25-12-098
2. Implementation Plan Addendum No. 6 (excluding Appendices)
3. Implementation Plan Addendum No. 6 Appendices A-I (Link) Agenda Page 94
RESO NO. 25-12-098
December 4, 2025
RESOLUTION NO. 25-12-098
A RESOLUTION OF THE BOARD OF DIRECTORS OF THE
CLEAN POWER ALLIANCE OF SOUTHERN CALIFORNIA TO
APPROVE IMPLEMENTATION PLAN ADDENDUM NO. 6 AND
TO AUTHORIZE STAFF TO FILE THE ADDENDUM WITH THE
CALIFORNIA PUBLIC UTILITIES COMMISSION
THE BOARD OF DIRECTORS OF THE CLEAN POWER ALLIANCE OF
SOUTHERN CALIFORNIA DOES HEREBY FIND, RESOLVE, AND ORDER AS FOLLOWS:
WHEREAS, the Clean Power Alliance of Southern California (formerly known as Los Angeles Community Choice Energy Authority) (“Clean Power Alliance” or “CPA”) was formed on June 27, 2017;
WHEREAS, Public Utilities Code Section 366.2 requires that before commencing a community choice aggregation program, Clean Power Alliance first must prepare and adopt an Implementation Plan to be filed with the California Public Utilities Commission; WHEREAS, Public Utilities Code Section 366.2 requires any subsequent changes to the Implementation Plan be considered and adopted at a duly noticed public hearing; WHEREAS, the Clean Power Alliance Implementation Plan and Statement of Intent was considered and adopted by the Clean Power Alliance Board of Directors on August 4, 2017, at a duly noticed public hearing;
WHEREAS, at duly noticed public hearings, the Clean Power Alliance Board of Directors considered and adopted Addendum No. 1 on December 19, 2017, Addendum No. 2 on March 1, 2018, Addendum No. 3 on December 13, 2018, Addendum No. 4 on December 1, 2022, and Addendum No. 5 on December 7, 2023; and, WHEREAS, the cities of Cudahy and Fillmore (individually, “City”; collectively, “Cities”) requested to be considered for membership in CPA so that customers in those jurisdictions can begin receiving service from CPA in 2027; WHEREAS, on September 4, 2025, the Board of Directors adopted Resolution 25- 09-092 offering CPA membership to each City to join CPA with CPA service to customers to begin in 2027 or in the calendar year specified by the California Public Utilities Commission if later than 2027;
WHEREAS, each City has considered and adopted an ordinance to join CPA; WHEREAS, CPA desires to admit the Cities for membership;
Agenda Page 95
RESO NO. 25-12-098
December 4, 2025
WHEREAS, the Clean Power Alliance of Southern California Implementation Plan Addendum No. 6 to authorize the Cities to join CPA was presented to the Clean Power Alliance Board of Directors at a duly noticed public hearing for its consideration and adoption.
NOW THEREFORE HAVING CONSIDERED ADDENDUM NO. 6 TO THE
IMPLEMENTATION PLAN AT A DULY NOTICED PUBLIC HEARING, BE IT
DETERMINED, AFFIRMED, AND RESOLVED BY THE BOARD OF DIRECTORS OF THE CLEAN POWER ALLIANCE OF SOUTHERN CALIFORNIA THAT:
1. Addendum No. 6 to the Implementation Plan of Clean Power Alliance, as presented herewith, is approved.
2. Clean Power Alliance staff is authorized to submit Implementation Plan Addendum No. 6, as presented, or in a substantially similar form, to the California Public Utilities Commission (CPUC) on or before December 31, 2025.
3. Each City shall be admitted as a member of the Clean Power Alliance 30 days after both of the following occur: (a) the CPUC’s certification of and issuance, if any, of findings on Addendum No. 6 to the Implementation Plan and (b) the satisfaction of any other conditions that the Board may establish in response to changes in regulations, legislation, or market conditions.
APPROVED AND ADOPTED this 4th day of December 2025.
Deborah Klein Lopez, Chair
ATTEST:
Gabriela Monzon, Secretary
Agenda Page 96
Clean Power Alliance of Southern
California (CPA)
ADDENDUM NO. 6
TO THE COMMUNITY CHOICE AGGREGATION
IMPLEMENTATION PLAN AND
STATEMENTOF INTENT
TO ADDRESS CPA EXPANSION TO THE CITIES OF
CUDAHY AND FILLMORE
December 04, 2025
Agenda Page 97
CHAPTER 1 – Introduction ....................................................................................................... 1 CHAPTER 2 – Changes to Address CPA Expansion to the Cities of Cudahy and Fillmore ............. 3 Process of Aggregation ..................................................................................................................... 4 Organizational Structure................................................................................................................... 4 Program Phase-In............................................................................................................................. 5 Sales and Customer Forecast ............................................................................................................ 8 Financial Plan................................................................................................................................. 11 Rate Policies................................................................................................................................... 13 Appendices.................................................................................................................................... 14 Table of Contents
Agenda Page 98
CPA Implementation Plan Addendum No. 6
1 The purpose of this document is to make certain revisions to the Clean Power Alliance of Southern California1 (“CPA”) Community Choice Aggregation Implementation Plan and Statement of Intent (“Implementation Plan”) to address the expansion of CPA to include the cities of Cudahy and Fillmore. CPA is a public agency which serves cities located within Los Angeles and Ventura counties and was formed in August 2017 for the purpose of implementing community choice aggregation (“CCA”).
Implementation Plan. In anticipation of its CCA implementation and in compliance with state law,2 CPA submitted its Implementation Plan to the California Public Utilities Commission (“CPUC” or “Commission”) on August 15, 2017 (see Appendix D). When initially formed, the Member Agencies of CPA included two (2) municipalities, Rolling Hills Estates and City of South Pasadena, located within the County of Los Angeles (“LA County”), as well as the unincorporated areas of LA County itself, which elected to allow CPA to provide electric generation service within their respective jurisdictions.
Addendum No. 1. At the end of 2017, twenty additional municipalities within Los Angeles and Ventura Countiesjoined CPA: the cities of Agoura Hills, Alhambra, Arcadia, Beverly Hills, Calabasas, Carson, Claremont, Culver City, Downey, Hawaiian Gardens, Hawthorne, Malibu, Manhattan Beach, Ojai, Paramount, Santa Monica, Sierra Madre, Temple City, Thousand Oaks, and West Hollywood, along with the unincorporated areas of County of Ventura (“Ventura County”). CPA submitted Addendum No. 1 to its Implementation Plan (“Addendum No. 1”) to the CPUC on December 29, 2017 to reflect its expanded membership (see Appendix E). On March 9, 2018, the Energy Division certified that Addendum No. 1 contains the information required by the Public Utilities Code (PUC) Section 366.2 (c).
Addendum No. 2. Addendum No. 2 to the CPA Implementation Plan (“Addendum No. 2”) was submitted by CPA on March 1, 2018 and describes CPA’s expansion plans to include the cities of Camarillo, Moorpark, Oxnard, Redondo Beach, Simi Valley, Ventura, and Whittier (see Appendix F). On March 28, 2018, the Energy Division certified that Addendum No. 2 to CPA’s Implementation Plan contains the information required by PUC Section 366.2 (c).
Addendum No. 3. Addendum No. 3 to the CPA Implementation Plan (“Addendum No. 3”) was submitted by CPA on December 14, 2018 and describes CPA’s expansion plans to include the city of Westlake Village (see Appendix G). On March 18, 2019, the Energy Division certified that Addendum No. 3 to CPA’s Implementation Plan contains the information required by PUC Section 366.2 (c).
1 CPA was formerly named Los Angeles Community Choice Energy (LACCE). CPA changed its name from LACCE to CPA by an amendment to its Joint Powers Agreement, dated April 5, 2018 (JPA), which was subsequently filed with the California Secretary of State’s Office on April 18, 2018. 2 See Public Utilities Code Section 366.2 (c).
CHAPTER 1 – Introduction
Agenda Page 99
CPA Implementation Plan Addendum No. 6
2 Addendum No. 4. Addendum No. 4 to the CPA Implementation Plan (“Addendum No. 4”) was submitted to the CPUC on December 14, 2022 and describes CPA’s expansion plans to include the cities of Hermosa Beach, Monrovia, and Santa Paula (see Appendix H). On March 8, 2022, the Energy Division certified that Addendum No. 4 to CPA’s Implementation Plan contains the information required by PUC Section 366.2 (c).
Addendum No. 5. Addendum No. 5 to the CPA Implementation Plan (“Addendum No. 5”) was submitted to the CPUC on December 18, 2023 and describes CPA’s expansion plans to include the cities of La Cañada Flintridge, Lynwood, and Port Hueneme (see Appendix I). On March 12, 2024, the Energy Division certified that Addendum No. 5 to CPA’s Implementation Plan contains the information required by PUC Section 366.2 (c).
Addendum No. 6. This Addendum No. 6 to the CPA Implementation Plan (“Addendum No. 6”) describes CPA’s expansion plans to include the cities of Cudahy and Fillmore. According to the Commission, the Energy Division is required to certify that revisions to CPA’s Implementation Plan reflect changes/consequences of additional members and thereby contains the information required by PUC Section 366.2 (c).3 With this in mind, CPA has reviewed its Implementation Plan, which was filed with the Commission on August 15, 2017, and the subsequent Addendum No. 1, Addendum No. 2, Addendum No. 3, Addendum No. 4, and Addendum No. 5, and has identified certain information that requires updating to reflect the changes and consequences of adding the new municipalities as well as the most recent historical electricity use and forecasts within CPA’s territory.
This Addendum No. 6 reflects pertinent changes related to the new member additions as well as projections that account for CPA’s planned expansion. This document format, including references to CPA’s Implementation Plan, which is incorporated by reference and attached hereto as Appendix D, addresses all requirements identified in PUC Section 366.2(c)(3), including universal access, reliability, equitable treatment of all customer classes and any requirements established by state law or by the CPUC concerning aggregated services, while streamlining public review of pertinent changes related to CPA expansion.
3 See PUC 366.2 (c) (7).
Agenda Page 100
CPA Implementation Plan Addendum No. 6
3 This Addendum No. 6 addresses the anticipated impacts of CPA’s planned expansion to the cities of Cudahy and Fillmore, as well as other forecast modifications reflecting the most recent historical electric energy use within CPA’s service territory. As a result of these member additions, certain assumptions regarding CPA’s future operations have changed, including customer energy requirements and renewable energy purchases. The following sections highlight pertinent changes related to this planned expansion. To the extent that certain details related to membership expansion are not specifically discussed within this Addendum No. 6, CPA represents that such information remains substantially unchanged relative to its August 15, 2017 Implementation Plan, which incorporates its December 29, 2017 Addendum No. 1, March 1, 2018 Addendum No. 2, December 14, 2018 Addendum No. 3, December 14, 2022 Addendum No. 4, and December 18, 2023 Addendum No. 5.
The following communities represent CPA’s membership:
Member Agencies
Agoura Hills Monrovia
Alhambra Moorpark
Arcadia Ojai
Beverly Hills Oxnard
Calabasas Paramount
Camarillo Port Hueneme
Carson Redondo Beach
Claremont Rolling Hills Estates
Cudahy Santa Monica
Culver City Santa Paula
Downey Sierra Madre
Fillmore Simi Valley
Hawaiian Gardens South Pasadena
Hawthorne Temple City
Hermosa Beach Thousand Oaks
La Cañada Flintridge West Hollywood
Los Angeles County (unincorporated) Ventura
Lynwood Ventura County (unincorporated)
Malibu Westlake Village
Manhattan Beach Whittier
CHAPTER 2 – Changes to Address CPA Expansion to the Cities of Cudahy and Fillmore
Agenda Page 101
CPA Implementation Plan Addendum No. 6
4 Throughout this document, use of the terms Members and Member Agencies shall now include the aforementioned communities. To the extent that the discussion addresses the process of aggregation and CPA organization, each of these communities is now a CPA Member and its electric customers will be offered CCA service consistent with the noted phase-in schedule.
Process of Aggregation
CPA’s aggregation process is discussed in Chapter 2 of CPA’s August 15, 2017 Implementation Plan and revised in Addendum Nos. 1, 2, 3, 4, and 5. In this Addendum No. 6, the following paragraph is added as the last paragraph in the “Process of Aggregation” section of Chapter 2 of the Implementation Plan as revised in Addendum Nos. 1, 2, 3, 4, and 5. “CPA is expanding its membership to include the cities of Cudahy and Fillmore. Each of these cities has requested CPA membership, and CPA’s Board of Directors subsequently approved each membership at a duly noticed public hearing on December 4, 2025.” Organizational Structure
Organizational structure was discussed in Chapter 3 of CPA’s August 15, 2017 Implementation Plan. The third paragraph of Chapter 3 is replaced in its entirety with the following verbiage:
“CPA will be governed by the CPA’s Board, which shall include one appointed designee from each of the Members. The CPA will be a joint powers agency formed under California law and was created on June 27, 2017. The CPA Members include twenty-eight (28) municipalities located within LA County (inclusive of Cudahy) as well as the unincorporated areas of LA County, and ten (10) municipalities located within Ventura County (inclusive of Fillmore) as well as the unincorporated areas of Ventura County, all of which have elected to allow the CPA to provide electric generation service within their respective jurisdictions. The CPA’s Board will be comprised of representatives appointed by each of the Members in accordance with the Joint Powers Agreement. The CPA Program will be operated under the direction of a Chief Executive Officer4 appointed by the Board, with legal and regulatory support provided by a Board appointed General Counsel.”
The organization of CPA’s power procurement function was discussed in the section on Electric Supply Operations in Chapter 3 of CPA’s August 15, 2017 Implementation Plan. This section is replaced in its entirety with the following verbiage:
“CPA’s power procurement activities are conducted in-house by a full-time staff with decades of energy industry experience at investor-owned utilities, publicly owned utilities, energy service providers, and other CCAs. CPA’s Power Supply department includes three divisions:
4 The Board formally changed the Executive Director’s title from “Executive Director” to “Chief Executive Officer” on November 3, 2022. Any reference to "Executive Director” should now be changed to “Chief Executive Officer.” Agenda Page 102
CPA Implementation Plan Addendum No. 6
5 1. Structured Contracts, which solicits, negotiates, and administers long-term (greater than five years in duration) contracts for new-build and existing renewable energy resources and Resource Adequacy (RA).
2. Power Origination, which contracts for short-term energy and RA, conducts position management of CPA’s renewable and carbon-free energy targets, and ensures compliance with RA and other energy resource portfolio obligations.
3. Market Operations, which settles CPA’s energy, RA and CAISO invoices; interfaces with CPA’s scheduling coordinator agent to optimize bidding and scheduling; and conducts post facto analysis of CPA’s operating portfolio of resources.
The Power Supply department works closely with CPA’s Risk Management division, part of CPA’s Finance department, to ensure that CPA’s power procurement activities adhere to CPA’s Board-approved Energy Risk Management Policy which details CPA’s hedging and risk management policies and practices. CPA provides Risk Management reports to its Board-level Finance and Energy Committees on a monthly basis and to its full Board on a quarterly basis. These Risk Management reports are public documents available on CPA’s website. CPA’s Load Forecasting team, also housed in CPA’s Finance department, provides long-term load forecasts to inform resource planning, position management, and other modeling activities.
CPA typically runs annual Requests for Offers (RFO) for long-term contracts and bimonthly RFOs for short-term energy and RA. Offers for long-term contracts are evaluated on quantitative and qualitative project attributes and ranked according to standardized criteria established by CPA’s governing Board of Directors. A Committee of CPA’s Board reviews and approves shortlisted offers, and all fully negotiated contracts are brought to CPA’s Board of Directors for approval before contract execution.
CPA contracts with Tenaska for scheduling coordination with the CAISO; Ascend Analytics to conduct quantitative evaluation of long-term project offers; and Calpine Energy Solutions for management of CPA’s customer data.”
Program Phase-In
Program phase-in was discussed in Chapter 5 of CPA’s August 15, 2017 Implementation Plan.
Chapter 5 is replaced in its entirety with the following verbiage:
“The CPA will roll out its service offering to customers over the course of the following phases:
Agenda Page 103
CPA Implementation Plan Addendum No. 6
6 CPA Phase
No.
Status & Description of Phase Implementation
Date
1 Complete: LA County Municipal accounts February 1, 2018 2 Complete: Non-residential in Los Angeles County
(unincorporated), Rolling Hills Estates, and South
Pasadena
June 25, 2018
3 Complete: All residential customers in Agoura Hills,
Alhambra, Arcadia, Beverly Hills, Calabasas, Camarillo, Carson, Claremont, Culver City, Downey, Hawaiian
Gardens, Hawthorne, Los Angeles County
(unincorporated), Malibu, Manhattan Beach, Moorpark,
Ojai, Oxnard, Paramount, Redondo Beach, Rolling Hills
Estates, Santa Monica, Sierra Madre, Simi Valley, South Pasadena, Temple City, Thousand Oaks, Ventura,
Ventura County (unincorporated), West Hollywood, and
Whittier
February 1, 2019
4 Complete: Non-residential customers in Agoura Hills,
Alhambra, Arcadia, Beverly Hills, Calabasas, Camarillo, Carson, Claremont, Culver City, Downey, Hawaiian
Gardens, Hawthorne, Malibu, Manhattan Beach,
Moorpark, Ojai, Oxnard, Paramount, Redondo Beach,
Santa Monica, Sierra Madre, Simi Valley, Temple City,
Thousand Oaks, Ventura, Ventura County
(unincorporated), West Hollywood, and Whittier
May 1, 2019
5 Complete: All customers in Westlake Village May 1, 2020 6 Complete: All customers in Hermosa Beach, Monrovia,
and Santa Paula
March 1, 2024
7 In Progress: All customers in La Cañada Flintridge,
Lynwood, and Port Hueneme
October 1, 2025
8 Planned: All customers in Cudahy and Fillmore October 1, 2027 This approach provides CPA with the ability to initiate its program in phases building to full program integration for an expected customer base of approximately 1,092,000 accounts, post customer opt-out. CPA will offer service to all customers on a phased basis per the schedule above.
Phase 1. Phase 1 of the Program was initiated on February 1, 2018, and at that time served approximately 1,950 accounts, comprised of all LA County municipal accounts.
Phase 2. Phase 2 of the Program commenced following successful operation of the CPA Program over an approximate five-month term, which corresponded to a Phase 2 service commencement Agenda Page 104
CPA Implementation Plan Addendum No. 6
7 date in June 2018. Approximately 29,000 additional customers, comprised of municipal, commercial, and industrial customers in LA County (unincorporated), Rolling Hills Estates, and South Pasadena were included in Phase 2.
Phase 3. Following the successful completion of Phase 1 and Phase 2 customer enrollments, CPA launched service to all residential customers in Agoura Hills, Alhambra, Arcadia, Beverly Hills, Calabasas, Camarillo, Carson, Claremont, Culver City, Downey, Hawaiian Gardens, Hawthorne, Los Angeles County (unincorporated), Malibu, Manhattan Beach, Moorpark, Ojai, Oxnard, Paramount, Redondo Beach, Rolling Hills Estates, Santa Monica, Sierra Madre, Simi Valley, South Pasadena, Temple City, Thousand Oaks, Ventura, Ventura County (unincorporated), West Hollywood, and Whittier. Phase 3 totaled approximately 837,000 accounts and commenced in February 2019.
Phase 4. Phase 4 of the program included municipal, commercial, and industrial customers in Agoura Hills, Alhambra, Arcadia, Beverly Hills, Calabasas, Camarillo, Carson, Claremont, Culver City, Downey, Hawaiian Gardens, Hawthorne, Malibu, Manhattan Beach, Moorpark, Ojai, Oxnard, Paramount, Redondo Beach, Santa Monica, Sierra Madre, Simi Valley, Temple City, Thousand Oaks, Ventura, Ventura County (unincorporated), West Hollywood, and Whittier. Phase 4 totaled approximately 104,000 accounts and commenced in May 2019.
Phase 5. Phase 5 of the program included all customers in Westlake Village. Phase 5 totaled approximately 4,000 accounts.
Phase 6. Phase 6 of the program included all customers in Hermosa Beach, Monrovia, and Santa Paula. Phase 6 totaled approximately 38,357 accounts.
Phase 7. Phase 7 of the program included all customers in La Cañada Flintridge, Lynwood, and Port Hueneme. Phase 7 totaled approximately 33,679 accounts.
Phase 8. Phase 8 of the program will include all customers in Cudahy and Fillmore. Phase 8 is expected to total approximately 11,081 accounts. All eligible customers will be transferred on their first meter read data on or after October 1, 2027, with the exception of customers on Net Energy Metering/Solar Bill Plan tariffs and customers on Budget Billing Plans. Those customers will be transferred on the first meter read date following the end of their annual SCE true-up period on or after October 1, 2027. This staggered approach to customer enrollment for customers with tariffs or plans that have SCE true-up dates ensures that those customers receive at least a full year of benefits from being on those tariffs or plans and is a standard customer protection measure jointly implemented by CPA and SCE during customer enrollment periods. To the extent that additional customers require enrollment after the completion of Phase 8, CPA will evaluate a subsequent phase of CCA enrollment.
CPA may also evaluate other phase‑in options based on current market conditions, statutory requirements, and regulatory considerations as well as other factors potentially affecting the integration of additional customer accounts.”
Agenda Page 105
CPA Implementation Plan Addendum No. 6
8 Sales and Customer Forecast
With regard to CPA’s sales and customer forecast, which is addressed in Chapter 6, Load Forecast & Resource Plan, CPA assumes the total retail sales will increase to approximately 11,332 GWh in Phase 8. CPA expects net peak demand to increase by approximately 106 MW in 2027 and by another 156 MW in 2028 as a result of the addition of the two new Member Agencies.
The following tables have been updated to reflect the impacts of the planned expansion to CPA’s new membership.
Table 1
Clean Power Alliance
Proposed Resource Plan (GWh)
2027 to 2036
2027 2028 2029 2030 2031 2032 2033 2034 2035 2036
CPA Demand
Retail Demand 11,332 11,906 12,394 12,902 13,371 13,896 14,319 14,760 15,204 15,676 Dist. Gen 0 0 0 0 0 0 0 0 0 0
Energy Efficiency 0 0 0 0 0 0 0 0 0 0
Losses and UFE 706 741 771 802 830 863 888 915 942 971
TOTAL DEMAND 12,038 12,647 13,165 13,704 14,201 14,759 15,207 15,675 16,146 16,647
CPA Supply
Total Renewable Resources 8,968 9,581 10,066 10,594 11,073 11,617 12,078 12,561 13,056 13,581 Total Conventional Resources 3,070 3,066 3,099 3,110 3,127 3,142 3,129 3,113 3,090 3,065 TOTAL SUPPLY 12,038 12,647 13,165 13,704 14,201 14,759 15,207 15,675 16,146 16,647
Energy Open Position 0 0 0 0 0 0 0 0 0 0
Agenda Page 106
CPA Implementation Plan Addendum No. 6
9 Table 2
Clean Power Alliance
Enrolled Retail Service Accounts
Phase-In Period (End of Month)
CPA Customers Enrolled
Accounts
Feb-18
Phase 1
Jun-18
Phase 2
Feb-19
Phase 3
May-19
Phase 4
May-20
Phase 5
Mar-24
Phase 6
Oct-25
Phase 7
Oct-27
Phase 8
Residential 951,055 23 5 875,057 0 3,225 32,955 29,840 9,950 Small Commercial 118,569 822 24,784 6 83,772 833 4,407 3,050 895 Medium Commercial 18,244 173 4,093 0 12,730 136 583 412 117 Large Commercial 1,245 16 254 0 893 17 26 28 11
Industrial 481 9 94 0 347 6 13 11 1
Street Lighting & Traffic 8,757 819 1,607 0 5,606 36 308 296 85 Agricultural & Pumping 3,902 67 805 0 2,892 9 65 42 22
Total 1,102,253 1,929 31,642 875,063 106,240 4,262 38,357 33,679 11,081 Note: Includes total eligible accounts at time of implementation for each phase.
Table 3
Clean Power Alliance
Retail Service Accounts (End of Year)
2027 to 2036
CPA
Customers 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 Residential 956,539 960,747 964,975 969,221 973,485 977,768 982,071 986,392 990,732 995,091 Small
Commercial 108,744 109,223 109,704 110,186 110,671 111,158 111,647 112,138 112,632 113,127 Medium
Commercial 15,820 15,890 15,960 16,030 16,101 16,172 16,243 16,314 16,386 16,458 Large
Commercial 891 894 898 902 906 910 914 918 922 926
Industrial 270 271 273 274 275 276 278 279 280 281
Street Lighting
& Traffic 7,395 7,427 7,460 7,493 7,526 7,559 7,592 7,625 7,659 7,693 Agricultural &
Pumping 2,649 2,660 2,672 2,684 2,696 2,708 2,719 2,731 2,743 2,756 Total 1,092,308 1,097,112 1,101,942 1,106,790 1,111,660 1,116,551 1,121,464 1,126,397 1,131,354 1,136,332 Agenda Page 107
CPA Implementation Plan Addendum No. 6
10 Table 4
Clean Power Alliance
Annual Energy Requirements (GWh)
2027 to 2036
CPA Energy Req. 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 Retail Energy 11,332 11,906 12,394 12,902 13,371 13,896 14,319 14,760 15,204 15,676 Losses and UFE 706 741 771 802 830 863 888 915 942 971
Total Load Requirement 12,038 12,647 13,165 13,704 14,201 14,759 15,207 15,675 16,146 16,647 Table 6
Clean Power Alliance
Capacity Requirements (MW)
2027 to 2036
Demand (MW) 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 Retail Demand 3,108 3,264 3,412 3,566 3,695 3,825 3,955 4,071 4,190 4,313 Losses and UFE 0 0 0 0 0 0 0 0 0 0
Total Net Peak Demand 3,108 3,264 3,412 3,566 3,695 3,825 3,955 4,071 4,190 4,313 Reserve Requirement (%) 18% 18% 18% 18% 18% 18% 18% 18% 18% 18% Capacity Reserve Requirement 559 588 614 642 665 689 712 733 754 776 Capacity Requirement Including Reserve 3667 3,852 4,026 4,208 4,360 4,514 4,667 4,804 4,944 5,089 Note: Reserve Requirement % for 2027 is based on actual RA program values. 2028 and beyond are estimates based on current information.
Table 8
Clean Power Alliance
SB 350 Long-term Renewable Procurement Requirements (GWh) 2018 to 2027
2027 2028 2029 2030 2031 2032 2033 2034 2035 2036
RPS
Requirements
(GWh)
5,881 6,437 7,022 7,671 7,952 8,268 8,521 8,786 9,052 9,335 Long-term
Renewable
Procurement
Target (% of
RPS)
65% 65% 65% 65% 65% 65% 65% 65% 65% 65%
Long-term
Renewable
Procurement
Target (GWh)
3,823 13,735 16,082 17,663
Forecasted
Long-term
Renewable
Procurement
(GWh)
9,829 32,132 32,143 30,256
Surplus /
(Deficit) of
Target (GWh)
6,006 18,397 16,061 12,593
Agenda Page 108
CPA Implementation Plan Addendum No. 6
11 Financial Plan
With regard to CPA’s financial plan, which is addressed in Chapter 7, Financial Plan, CPA has updated its expected operating results, which now include projected impacts related to service expansion within CPA’s new member communities. The new energy procurement and overhead costs to serve these communities will be funded through existing reserves and cash flows. The following table reflects updated operating projections in consideration of the planned expansion.
Agenda Page 109
CPA Implementation Plan Addendum No. 6
12 Table 9
Clean Power Alliance
Summary of CCA Program Phase-In
2027 to 2036
2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 Total Operating Revenues
Electric Sales, net $1,150,292,285 $1,193,230,769 $1,247,180,673 $1,301,041,328 $1,349,935,444 $1,276,890,174 $1,207,816,966 $1,241,268,704 $1,241,268,704 $1,241,268,704 $12,450,193,752 Revenue transf. from/(to)
Fiscal Stabilization Fund $29,000,000 $14,000,000 $0 $0 $0 $0 $61,000,000 $8,000,000 $0 $0 $112,000,000 Other Revenue $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Operating Revenues $1,179,292,285 $1,207,230,769 $1,247,180,673 $1,301,041,328 $1,349,935,444 $1,276,890,174 $1,268,816,966 $1,249,268,704 $1,241,268,704 $1,241,268,704 $12,562,193,752 Cost of Electricity $1,130,905,925 $1,107,982,888 $1,177,002,967 $1,225,445,284 $1,279,417,646 $1,303,691,016 $1,105,898,530 $1,158,191,567 $1,172,775,389 $1,163,334,988 $11,824,646,202 Operating & Administrative
Contract Services $31,919,434 $32,379,069 $32,846,002 $33,320,364 $33,802,288 $34,291,911 $34,789,370 $35,294,806 $35,808,364 $36,330,191 $340,781,798 Staff Compensation $34,182,137 $34,674,354 $35,174,387 $35,682,376 $36,198,463 $36,722,794 $37,255,517 $37,796,782 $38,346,745 $38,905,564 $364,939,120 General & Administration $12,325,135 $12,502,615 $12,682,913 $12,866,080 $13,052,167 $13,241,226 $13,433,311 $13,628,476 $13,826,778 $14,028,272 $131,586,973 Total Operating &
Administrative $78,426,707 $79,556,038 $80,703,302 $81,868,820 $83,052,918 $84,255,931 $85,478,197 $86,720,065 $87,981,887 $89,264,027 $837,307,891 Non-Operating Revenues
(Expenses)
Interest Income $19,827,323 $19,119,884 $19,586,457 $19,716,469 $20,312,370 $20,176,963 $19,296,956 $19,296,956 $19,296,956 $19,296,956 $195,927,290 Interest and Related Expenses -$1,121,241 -$1,121,241 -$1,121,241 -$1,121,241 -$1,121,241 -$1,121,241 -$1,121,241 -$1,121,241 -$1,121,241 -$1,121,241 -$11,212,410 Total Non-operating
Revenues (Expenses) $18,706,082 $17,998,643 $18,465,216 $18,595,228 $19,191,129 $19,055,722 $18,175,715 $18,175,715 $18,175,715 $18,175,715 $184,714,880 Total Expenses $1,190,626,550 $1,169,540,283 $1,239,241,053 $1,288,718,876 $1,343,279,435 $1,368,891,225 $1,173,201,012 $1,226,735,916 $1,242,581,561 $1,234,423,300 $12,477,239,213 CCA Program Net Position $459,611,608 $497,302,094 $505,241,714 $517,564,165 $524,220,173 $432,219,122 $527,835,076 $550,367,865 $549,055,008 $555,900,412
Agenda Page 110
CPA Implementation Plan Addendum No. 6
13 Rate Policies
Rate offerings were discussed in Chapters 2, 6, 7, and 8 of the Implementation Plan. In these chapters, the Implementation Plan refers to a 50 percent renewable energy supply option and a 100 percent renewable supply option. This Addendum No. 6 updates such options to include a 40 percent clean energy supply option and a 50 percent clean energy supply option. As such, the Implementation Plan should read that CPA currently offers its customers three rate options: (i) 40 percent clean, (ii) 50 percent clean, and (iii) 100 percent renewable energy supply options.
Note that rate options are subject to change as determined by CPA’s Board.
Agenda Page 111
CPA Implementation Plan Addendum No. 6
14 Appendices
Appendix A: Resolution 25-12-098 approving cities of Cudahy and Fillmore as members of CPA
Appendix B: Joint Powers Agreement
Appendix C: Member Ordinances
Appendix D: Clean Power Alliance Implementation Plan and Statement of Intent without attachments (August 15, 2017)
Appendix E: Clean Power Alliance Implementation Plan Addendum No. 1 without attachments (December 29, 2017)
Appendix F: Clean Power Alliance Implementation Plan Addendum No. 2 without attachments (March 1, 2018)
Appendix G: Clean Power Alliance Implementation Plan Addendum No. 3 without attachments (December 14, 2018)
Appendix H: Clean Power Alliance Implementation Plan Addendum No. 4 without attachments (December 14, 2022)
Appendix I: Clean Power Alliance Implementation Plan Addendum No. 5 without attachments (December 18, 2023)
Agenda Page 112
Staff Report – Agenda Item 14
To: Board of Directors
From: Emily Andrews, Project Manager, Structured Contracts Alexandra Caryotakis, Senior Advisor, 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: Power Share Renewable Power Purchase Agreements Date: December 4, 2025
RECOMMENDATION
Approved and authorize the Chief Executive Officer to execute the following long-term Renewable Power Purchase Agreements (PPAs) for local resources to serve the Power Share Program:
A. 20-Year 4 MW PPA with Saticoy Sun Farms, LLC for the Saticoy project B. 20-Year 2.46 MW PPA with Fillmore Sun Farms, LLC for the Fillmore project C. 20-Year 4.99 MW PPA with BMT Elkhorn, LLC for the Elkhorn project D. 20-Year 3W MW PPA with RPCA Solar 17, LLC for the Road 232 project
BACKGROUND
CPA's Power Share program promotes the development of renewable generation in and for underserved communities. Power Share is CPA’s program name for the California Public Utilities Commission’s (CPUC) Disadvantaged Community Green Tariff (DAC-GT) program. Power Share provides enrolled customers with 100% renewable energy at a 20% bill discount from resources located within a DAC in Southern California Edison territory. Above market procurement costs associated with Power Share resources are Agenda Page 113
Board of Directors Item 14
reimbursed to CPA by the CPUC. CPA must implement the Power Share programs consistent with CPUC guidelines, including adherence to a confidential cost cap set by the CPUC. Power Share PPAs also must be approved by the CPUC after approval by the CPA Board.
The table below shows CPA’s total DAC-GT program allocation, currently executed PPA capacity, and the remaining capacity CPA will need to procure to fully supply the program allocation:
CPA DAC-GT Program
Allocation (MW)
Executed PPA
Capacity (MW)
Remaining Capacity to
Procure (MW)
Remaining
Capacity to
Procure (%)
19.815 7.27 12.545 37%
2025 Power Share RFO
In May 2025, CPA launched its fourth Power Share RFO targeting procurement of 12.545 MW of RPS-eligible generation to fill its remaining program allocation under the CPUC-approved DAC-GT program.
CPA received 15 offers that conformed with project eligibility requirements from seven different developers totaling nearly 50 MW of capacity; ten of these offers were below the confidential program price cap. All offers under the price cap were for ground-mounted RPS-eligible solar generation. On August 20, 2025, a review team consisting of four Board members from the Energy Committee as well as staff consisting of the Chief Executive Officer, the Chief Operating Officer, and the Vice President of Power Supply met to analyze the submitted projects. These review team members evaluated confidential terms and conditions, including pricing, and selected a shortlist of projects to be recommended to the Energy Committee. On August 27, 2025, the Energy Committee reviewed and approved the recommended shortlist, authorizing staff to proceed with negotiations with 4 projects for contracts 20 years in length: one with Renewable Properties (Road 232), one with Radiant (Elkhorn), and two projects with Ventura Energy (Filmore and Saticoy).
Agenda Page 114
Board of Directors Item 14
CPA retained Kevin Fox with Keyes and Fox to represent CPA and its legal interests in the negotiation of these agreements. Mr. Fox’s work was overseen by the General Counsel.
If approved, these four contracts will fill CPA’s remaining DAC-GT program capacity with an overage of 1.905 MW. The Energy Committee approved the 2025 Power Share RFO shortlist with this program capacity overage in mind to account for potential project failure.
If all projects succeed, CPA will not seek cost recovery for volume exceeding its capacity allocation, nor expand the number of customers served by Power Share, and the excess volume will become part of CPA’s regular renewable energy portfolio.1 Given the small size of the potential overage, the financial impact of any overage would be de minimis.
CPA Remaining DAC-GT
Program Allocation (MW)
Proposed PPA Capacity
(MW)
Remaining DAC-GT
Program Allocation (MW)
12.545 14.45 (0)
Project Overview
Project Developer Capacity (MW) Online Date Location
Ventura Sun
Farms, LLC
(Saticoy)
Ventura Energy 4 12/31/2028 Ventura County
Ventura Sun
Farms, LLC
(Fillmore)
Ventura Energy 2.46 12/31/2028 Fillmore, Ventura
County
BMT Elkhorn,
LLC (Elkhorn)
Radiant BMT 4.99 12/31/2027 Newberry Springs,
San Bernardino
County
1 Since 2021, 4.92 MW of Power Share capacity under executed PPAs with CPA has terminated prior to reaching commercial operations, out of a total of 12.19 MW contracted. This leaves 7.27 MW of active, executed program capacity.
Agenda Page 115
Board of Directors Item 14
RPCA Solar
17, LLC
(Road 232)
Renewable
Properties
3 12/31/2028 Strathmore, Tulare
County
CPA pays for the output of the solar generation at a fixed-price rate per MWh, with no escalation, for the full term of the contracts (20 years). CPA is entitled to energy and renewable energy credits (RECs) from the projects.
A detailed overview of the projects and evaluation criteria is provided in the project descriptions attached to this report.
Rationale
The projects are being procured under the CPUC DAC-GT program, which is a program designed to encourage the development of clean energy resources located in disadvantaged communities within the state of California. This program allows CPA to offer eligible customers who enroll with 100% renewable energy and a 20% bill discount.
The CPUC reimburses CPA on program costs, including above-market procurement costs, the 20% customer bill discount, and CPA’s program implementation costs.
The projects comply with project eligibility requirements of the DAC-GT program and would serve about 6,350 Power Share customers. CPA currently has approximately 10,000 residential customers enrolled in the Power Share program, approximately 6,300 of which are served by short-term interim contracts that may not be able to be renewed.
By executing these long-term PPAs, CPA seeks to ensure that these customers can continue to receive the benefits of the Power Share program.
Should the Board approve execution of these PPAs, CPA is required to submit the PPAs to the CPUC for subsequent approval.
Agenda Page 116
Board of Directors Item 14
Environmental Review
These PPAs for the purchase of energy do not fall under the definition of “project” under Section 21065 of the Public Resources Code and under California Environmental Quality Act (CEQA) Guidelines Section 15378(a). In addition, the PPAs are exempt under CEQA Guidelines Section 15061(b)(3). The project developers of the four projects are each responsible for acquiring necessary California Environmental Quality Act (CEQA) or National Environmental Policy Act (NEPA) review and permits with relevant lead agencies. For the Road 232 project, the lead agency is Tulare County. A Conditional Use Permit (CUP) pre-application has been submitted to Tulare County and environmental screening and mitigation planning are in progress. For the Elkhorn project, the lead agency is San Bernardino County and the CUP application is in process, a Mitigated Negative Declaration is expected. For the Fillmore and Saticoy projects, the lead agency is Ventura County and the CUP applications are in process, with a Negative Declaration anticipated. CPA has no role, jurisdiction, or authority whatsoever with respect to CEQA review or project approval.
Project Descriptions
Project Description A and B: Saticoy and Fillmore
Developer
Ventura Sun Farms, LLC (Ventura Energy) is a joint venture between Ventura Energy Partners and the Finch Investment Partnership, LP and is headquartered in Santa Barbara. Ventura Energy focuses on solar and energy storage projects in California varying from distributed to transmission level projects. They have deployed more than a dozen renewable energy projects in Ventura County.
Evaluation Criteria
CPA ranks projects for economic value based on the NPV to CPA and on a High, Medium, Neutral, and Low scale in five other 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 Agenda Page 117
Board of Directors Item 14
of those categories.
Value
Both projects fall within the third quartile (Q3) of submissions ranked by NPV in the 2025 Power Share RFO. The PPA includes defined price reducers; in the event that the project qualifies for tax credits, the contract price will be reduced by a pre-defined amount. The base contract price assumes no tax credits and is under the price cap set by the CPUC for DAC-GT contracts.
Development Score
The projects rank Medium. Both sites have executed Interconnection Agreements with Southern California Edison via the Fast Track Process. Site control has been established for the sites, and they have engaged with Ventura’s planning department regarding permitting for parcels currently designated as “Agriculture Exclusive.” As the projects are located within Ventura County’s Save Open Space and Agricultural Resources (SOAR) territory and will maintain the existing agricultural designation, they will not trigger a county-wide vote typically required for zoning changes in SOAR territory. The planned development includes inter-row cultivation of lower water use crops, thereby preserving the agricultural use classification and avoiding the need for rezoning.
Workforce Development
The projects rank High as construction for the projects will be conducted using union labor via Project Labor Agreements. The developer estimates that the two projects will create 50 new direct construction jobs and 6 permanent jobs.
Environmental Stewardship
The projects rank Neutral as the projects do not demonstrate any additional benefits beyond the climate and GHG reduction benefits of renewable energy and are not located in an area designated as a preferred renewable energy zone. The projects are also not located in an avoidance area.
Agenda Page 118
Board of Directors Item 14
Benefits to Disadvantaged Communities
The projects rank High as they are each located in a Disadvantaged Community and will provide bill savings to low-income customers.
Project Location
The projects rank High as they are located in Ventura County.
Project Description C: Elkhorn
Developer
Radiant BMT, LLC (Radiant) was established by three renewable energy project developers to pursue development of community scale, wholesale distributed generation projects in California. Radiant’s three principals have collectively developed over $700 million of operating solar and wind generation assets in the Western US.
Evaluation Criteria
CPA ranks projects for economic value based on the NPV to CPA and on a High, Medium, Neutral, and Low scale in four other evaluation criteria categories (Development Score, Workforce Development, Environmental Stewardship, and Project Location). Below is the ranking assigned to this project in each of those categories.
Value
The project falls within the second quartile (Q2) of submissions ranked by NPV in the 2025 Power Share RFO. The PPA includes defined price reducers; in the event that the project qualifies for tax credits, the contract price will be reduced by a pre-defined amount.
The base contract price assumes no tax credits and is under the price cap set by the CPUC for DAC-GT contracts.
Development Score
The project ranks High. Site control has been secured. The project is currently in the permitting process with San Bernardino County and will benefit from using environmental studies and surveys conducted for another adjacent solar project which successfully Agenda Page 119
Board of Directors Item 14
secured a Conditional Use Permit. An Interconnection Agreement with Southern California Edison has been executed and no network upgrades are required to interconnect the project.
Workforce Development
The projects rank High as construction for the project will be conducted using union labor via a Project Labor Agreement. The developer estimates that the project will create 25 new direct construction jobs.
Environmental Stewardship
The project ranks Neutral as it does not demonstrate additional benefits beyond the climate and GHG reduction benefits of renewable energy and is not located in an area designated as a preferred renewable energy zone. The project is also not located in a high-conflict area.
Project Location
The project ranks Medium as it is located in California.
Project Description D: Road 232
Developer
Renewable Properties, LLC (RP) was founded in 2017 and is headquartered in San Francisco, CA. RP’s portfolio consists of 38 operational solar projects totaling 156 MW across seven states. Community solar and distributed generation have been RP’s development focus since their founding.
Evaluation Criteria
CPA ranks projects for economic value based on the net present value (NPV) to CPA and on a High, Medium, Neutral, and Low scale in four other evaluation criteria categories (Development Score, Workforce Development, Environmental Stewardship, and Project Location). Below is the ranking assigned to this project in each of those categories.
Agenda Page 120
Board of Directors Item 14
Value
The project falls within the third quartile (Q3) of submissions ranked by NPV in the 2025 Power Share RFO. The PPA includes defined price reducers; in the event that the project qualifies for tax credits, the contract price will be reduced by a pre-defined amount. The base contract price assumes no tax credits and is under the price cap set by the CPUC for DAC-GT contracts.
Development Score
The projects rank Medium. Site control has been secured. Interconnection is currently advancing with Southern California Edison, and the project has received its System Impact Study with a Small Generation Interconnection Agreement underway. A Conditional Use Permit pre-application has been submitted to Tulare County. As part of this process, environmental screening and mitigation planning are in progress.
Workforce Development
The project ranks Medium as the project does not have Project Labor Agreements, but will demonstrate prevailing wage, union labor, and targeted hire commitments. The developer estimates that the project will create 22 new direct construction jobs and 4 permanent jobs.
Environmental Stewardship
The project ranks Neutral as the project does not demonstrate any additional benefits beyond the climate and GHG reduction benefits of renewable energy and is not located in an area designated as a preferred renewable energy zone. The project is also not located in a high-conflict area.
Project Location
The project ranks Medium as it is located in California.
Agenda Page 121
Board of Directors Item 14
ATTACHMENTS2
1. 2025 Power Share RFO PPA Presentation
2. Renewable Power Purchase Agreement with Saticoy Sun Farms, LLC
3. Renewable Power Purchase Agreement with Fillmore Sun Farms, LLC
4. Renewable Power Purchase Agreement with BMT Elkhorn, LLC
5. Renewable Power Purchase Agreement with RPCA Solar 17, LLC _________________________
2. Consistent with industry practice, portions of the agreements have been redacted to protect market sensitive information.
Agenda Page 122
2025 Power Share RFO
Power Purchase Agreements
December 4, 2025
Agenda Page 123
Executive Summary
2 Under CPA’s Power Share program (known by the California Public Utilities Commission (CPUC) as the Disadvantaged Green Tariff (DAC-GT) program), CPA procures energy from small-scale renewable projects within Disadvantaged Communities (DACs) in order to provide 100% renewable energy to low-income customers at a 20% bill discount.
The CPUC funds above market costs for these resources, the 20% bill discount and program implementation costs.
CPA launched its fourth Power Share RFO in May 2025 to fill its remaining 12.545 MW of unprocured capacity.
CPA received 15 offers that conformed with project eligibility requirements, 10 of which were below the confidential program price cap, which is determined by the CPUC.
On August 27th, 2025 the Energy Committee approved a shortlist of four projects totaling 14.45 MW and one waitlisted project. Negotiations with all four shortlisted projects have been successful and the Power Purchase Agreements (PPAs) are being presented to the Board for consideration.
Agenda Page 124
Action Requested
3 Action Requested: Approve four (4) Renewable PPAs and authorize the Chief Executive Officer (CEO) to execute the agreements:
20-Year PPA with Saticoy Sun Farms, LLC for the 4 MW Saticoy project 20-Year PPA with Fillmore Sun Farms, LLC for the 2.46 MW Fillmore project 20-Year PPA with BMT Elkhorn, LLC for the 4.99 MW Elkhorn project 20-Year PPA with RPCA Solar 17, LLC for the 3 MW Road 232 project Agenda Page 125
Agenda
Power Share Background
Power Share PPAs
Action Requested
Agenda Page 126
Program and
Regulatory
Background
Agenda Page 127
5 CPA Power Share Program
Under CPA’s Power Share program, CPA procures energy from small -scale renewable projects within DACs in order to provide 100% renewable energy to low-income customers at a 20% bill discount.
The CPUC funds above market costs for these resources, the 20% bill discount, and program implementation costs.
CPA must implement its Power Share program consistent with CPUC guidelines, including adherence to a confidential cost cap for proposed projects that was set by the CPUC at the launch of the program1.
Power Share currently serves ~10,000 CPA residential customers Most Power Share customers are served by interim resources procured from SCE that may not be able to be renewed; these customers will transition to being served by CPA’s long-term PPA resources as they come online
37% of CPA’s Power Share program capacity is currently filled by long-term contracts 6 1. The price cap was established in D.18-06-027 based on 200% of the Renewable Auction Mechanisms’ as-available peaking category.
Agenda Page 128
Congressional Budget Bill Impacts
7 The 2025 Power Share RFO was launched on May 12, 2025 On July 4, 2025, passage of the Congressional Budget Bill established that renewable generation projects that are not under construction by July 4, 2026, must be placed in service by the end of 2027 to qualify for tax credits (ITC or PTC)
In response, CPA released an addendum to the RFO requiring that proposers provide a PPA Offer Price assuming the project does not qualify for the ITC or PTC.
This price was used in project evaluation to ensure that any PPAs CPA signs will not be at a price that exceeds the DAC-GT price cap.
Proposers were also requested to provide price reducers in the event that the project does qualify for the ITC or PTC. The percentage decrease that ITC or PTC price reducers provide relative to the PPA Offer Price was used as a qualitative evaluation factor.
All four Power Share PPA Sellers intend to safe harbor equipment in 2025 to qualify for ITC benefits.
Agenda Page 129
CPA’s Power Share Portfolio
8 CPA has 8 active contracts for its Power Share program*.
Prologis El Segundo, Dominguez, Wilmington 1, and Wilmington 2 projects in Hawthorne and Carson are online.
The remaining contracted Power Share projects are in development with expected CODs in 2025 and 2026.
Counterparty Project Program Capacity (MW) COD Location Prologis El Segundo Power Share 0.64 7/29/2025 Hawthorne Prologis Dominguez Power Share 0.96 8/12/2025 Carson
Prologis Wilmington 2 Power Share 0.6 8/15/2025 Carson
Prologis Wilmington 1 Power Share 1.8 9/25/2025 Carson
Prologis Carson 1 Power Share 0.68 Q1 2026 Carson
Prologis Commerce 4 Power Share 1.24 Q1 2026 Commerce
Prologis Eaves 1 Power Share 0.68 Q2 2026 Commerce
Prologis Eaves 3 Power Share 0.67 Q2 2026 Commerce
7.27 MW
Program Allocation (MW) PPA Executed Capacity (MW) Remaining Program Capacity (MW)
19.815 7.27 12.545
*CPA also has 4 projects for its Power Share Community Solar program, totaling 3.37 MW. 2 projects are currently online (0.67 MW), and 2 are expected to go online in early and mid-2026 (2.7 MW) Agenda Page 130
Power Share
PPAs
Agenda Page 131
9 RFO Overview
10 The 2025 Power Share RFO was released in May 2025 to fill CPA’s remaining 12.545 MW of unprocured capacity.
On August 27, 2025, the Energy Committee approved shortlisting four (4) projects from this RFO, including two local projects in Ventura County
If approved today, the four PPAs will be submitted to the CPUC for review. Once approved, they will be eligible for above-market cost reimbursement. CPA is procuring 1.905 MW more than its program capacity. If all of the projects are successful1, costs for the excess procurement cannot be recovered; the excess volume would be added to CPA’s regular renewable portfolio.
CPA will also have filled its current Power Share program capacity allocation and will not need to launch further Power Share RFOs unless it is allocated additional program capacity or projects fail to come online.
CPA’s Power Share
Allocation (MW)
To Date DAC RFO
Procurement (MW)
CPA’s Remaining
Allocation
(MW)
Proposed
Additional
Capacity (MW)
CPA’s Remaining
Allocation after
Recommendation (%)
19.815 7.27 12.545 14.45 0%
1. Since 2021, 4.92 MW of Power Share capacity that CPA had an executed PPA with terminated prior to commercial operations.
Agenda Page 132
Ventura Energy - Saticoy
11 Project Overview
4 MW ground-mounted solar project
Products: Energy and Renewable Energy Credits (RECs)
Location: Unincorporated Ventura County
New build project with December 31, 2028 online date
Developer: Ventura Energy
Term: 20 years
Criteria Rank
Value 3rd Quartile
Development Score Medium
Workforce
Development High
Environmental
Stewardship Neutral
Project Location High
Rationale
The project will help fill CPA’s
Power Share program
allocation
Located in CPA’s service
territory
Agenda Page 133
Ventura Energy - Fillmore
12 Project Overview
2.46 MW ground-mounted solar project
Products: Energy and RECs
Location: Unincorporated Ventura County
New build project with December 31, 2028 online date
Developer: Ventura Energy
Term: 20 years
Criteria Rank
Value 3rd Quartile
Development Score Medium
Workforce
Development High
Environmental
Stewardship Neutral
Project Location High
Rationale
The project will help fill
CPA’s Power Share program
allocation
Located in CPA’s service
territory
Agenda Page 134
Solar “Agrivoltaics” Examples
Agenda Page 135
Radiant BMT – Elkhorn
14 Project Overview
4.99 MW ground-mounted solar project
Products: Energy and RECs
Location: Newberry Springs, CA
New build project with December 31, 2027 online date
Developer: Radiant BMT
Term: 20 years
Rationale
The project will help fill CPA’s Power Share program
allocation
High Value / Low Risk
Criteria Rank
Value 2nd Quartile
Development Score High
Workforce
Development High
Environmental
Stewardship Neutral
Project Location Medium
Agenda Page 136
Renewable Properties – Road 232
15 Criteria Rank
Value 3rd Quartile
Development Score Medium
Workforce
Development Medium
Environmental
Stewardship Neutral
Project Location Medium
Project Overview
3 MW ground-mounted solar project
Products: Energy and RECs
Location: Tulare County, CA
New build project with December 31, 2028 online date
Developer: Renewable Properties
Term: 20 years
Rationale
The project will help fill CPA’s Power Share program
allocation
Agenda Page 137
Action
Requested
Agenda Page 138
16 Action Requested
17 Approve and authorize the CEO to execute the four (4) long-term renewable PPAs listed below
Developer Project Name Capacity
(MW) Online Date Term (years) Location
Ventura Energy Saticoy 4 12/31/2028 20 Ventura
Ventura Energy Fillmore 2.46 12/31/2028 20 Fillmore
Radiant Elkhorn 4.99 12/31/2027 20 Newbury Springs
Renewable
Properties Road 232 3 12/31/2028 20 Strathmore
Agenda Page 139
EXECUTION VERSION
RENEWABLE POWER PURCHASE AGREEMENT
COVER SHEET
Seller: Saticoy Sun Farms, LLC
Buyer: Clean Power Alliance of Southern California, a California joint powers authority Description of Facility: Saticoy Solar, a 4.0 MWAC (5.6 MWDC) photovoltaic project.
Milestones:
Milestone Expected Date for
Completion
Evidence of Site Control 6/22/2024
Documentation of Conditional Use Permit if required:
CEQA [ ] Cat Ex, [X] Neg Dec, [ ] Mitigated Neg Dec,
[ ] EIR
12/31/2026
Seller’s receipt of Phase I and Phase II Interconnection study results for Seller’s Interconnection Facilities N/A Executed Interconnection Agreement Completed
Financial Close
Expected Construction Start Date 12/31/2027
Initial Synchronization 6/15/2028
Network Upgrades completed (evidenced by delivery of
permission to parallel letter from the Transmission
Provider)
6/30/2028
Expected Date of CAISO Commercial Operation 6/30/2028
Expected Commercial Operation Date 6/30/2028
Delivery Term: Twenty (20) Contract Years
Delivery Term Expected Energy:
Agenda Page 140
Contract Year Expected Energy (MWh)
1 12,467
2 12,404
3 12,342
4 12,318
5 12,219
6 12,158
7 12,097
8 12,073
9 11,977
10 11,917
11 11,857
12 11,834
13 11,739
14 11,680
15 11,622
16 11,599
17 11,506
18 11,448
19 11,391
20 11,368
Guaranteed Capacity: 4.0 MWAC of total Facility capacity Renewable Rate:
Agenda Page 141
Contract Year Renewable Rate ($/MWh)
1 – 20 $ / MWh (flat) with
no escalation
Seller’s Assumed Tax Credits: As of the Effective Date, the Renewable Rate set forth above on the Cover Sheet assumes the Facility will qualify for the ITC at zero percent (0%) and/or the PTC at $0.00/kWh for the Facility.
Guaranteed Construction Start Date: 6/30/2028
Guaranteed Commercial Operation Date: 12/31/2028
Product
☒ Energy
☒ Green Attributes (if Renewable Energy Credit, please check the applicable box below):
☒ Portfolio Content Category 1
☐ Portfolio Content Category 2
☐ Portfolio Content Category 3
☐ Imbalance Reserves
☐ Capacity Attributes
Scheduling Coordinator: Buyer
Security Amounts:
Development Security: $105/kW of Guaranteed Capacity
Performance Security: $105/kW of Installed Capacity
Agenda Page 142
TABLE OF CONTENTS
Page
i
ARTICLE 1 DEFINITIONS ............................................................................................................1
1.1 Contract Definitions .................................................................................................1
1.2 Rules of Interpretation ...........................................................................................18 ARTICLE 2 TERM; CONDITIONS PRECEDENT .....................................................................19
2.1 Contract Term ........................................................................................................19
2.2 Conditions Precedent .............................................................................................20
2.3 Development; Construction; Progress Reports ......................................................21
2.4 Remedial Action Plan ............................................................................................22
2.5 Low-Income Community Bonus............................................................................22 ARTICLE 3 PURCHASE AND SALE .........................................................................................22
3.1 Purchase and Sale of Product .................................................................................22
3.2 Sale of Green Attributes.........................................................................................22
3.3 Imbalance Energy ..................................................................................................22
3.4 Ownership of Renewable Energy Incentives .........................................................23
3.5 Future Environmental Attributes ...........................................................................23
3.6 Test Energy ............................................................................................................23
3.7 CEC Certification and Verification .......................................................................24
3.8 Eligibility ...............................................................................................................24
3.9 California Renewables Portfolio Standard .............................................................24
3.10 Compliance Expenditure Cap ................................................................................24
3.11 Project Configuration .............................................................................................25 ARTICLE 4 OBLIGATIONS AND DELIVERIES ......................................................................25
4.1 Delivery..................................................................................................................25
4.2 Title and Risk of Loss ............................................................................................26
4.3 Forecasting .............................................................................................................26
4.4 Dispatch Down/Curtailment ..................................................................................28
4.5 Station Use .............................................................................................................28
4.6 Facility Maintenance ..............................................................................................29
4.7 Guaranteed Energy Production ..............................................................................29
4.8 WREGIS ................................................................................................................30 ARTICLE 5 TAXES ......................................................................................................................31
5.1 Allocation of Taxes and Charges ...........................................................................31
5.2 Cooperation ............................................................................................................32 ARTICLE 6 MAINTENANCE OF THE FACILITY ...................................................................32
6.1 Maintenance of the Facility ...................................................................................32
6.2 Maintenance of Health and Safety .........................................................................32
6.3 Shared Facilities .....................................................................................................32 ARTICLE 7 METERING ..............................................................................................................33
7.1 Metering .................................................................................................................33
7.2 Meter Verification ..................................................................................................33
Agenda Page 143
ii
ARTICLE 8 INVOICING AND PAYMENT; CREDIT ...............................................................34
8.1 Invoicing ................................................................................................................34
8.2 Payment..................................................................................................................34
8.3 Books and Records ................................................................................................34
8.4 Payment Adjustments; Billing Errors ....................................................................34
8.5 Billing Disputes .....................................................................................................35
8.6 Netting of Payments ...............................................................................................35
8.7 Seller’s Development Security ..............................................................................35
8.8 Seller’s Performance Security................................................................................35
8.9 First Priority Security Interest in Cash or Cash Equivalent Collateral ..................36 ARTICLE 9 NOTICES ..................................................................................................................36
9.1 Addresses for the Delivery of Notices ...................................................................36
9.2 Acceptable Means of Delivering Notice ................................................................37 ARTICLE 10 FORCE MAJEURE ................................................................................................37
10.1 Definition ...............................................................................................................37
10.2 No Liability If a Force Majeure Event Occurs ......................................................38
10.3 Notice .....................................................................................................................38
10.4 Termination Following Force Majeure Event or Development Cure Period ........38 ARTICLE 11 DEFAULTS; REMEDIES; TERMINATION ........................................................39
11.1 Events of Default ...................................................................................................39
11.2 Remedies; Declaration of Early Termination Date ................................................41
11.3 Damage Payment; Termination Payment ..............................................................41
11.4 Notice of Payment of Termination Payment or Damage Payment ........................42
11.5 Disputes With Respect to Termination Payment or Damage Payment .................43
11.6 Limitation on Seller’s Ability to Make or Agree to Third-Party Sales from the Facility after Early Termination Date ..............................................................43
11.7 Rights And Remedies Are Cumulative ..................................................................43
11.8 Mitigation ...............................................................................................................43 ARTICLE 12 LIMITATION OF LIABILITY AND EXCLUSION OF WARRANTIES............43
12.1 No Consequential Damages ...................................................................................43
12.2 Waiver and Exclusion of Other Damages ..............................................................44 ARTICLE 13 REPRESENTATIONS AND WARRANTIES; AUTHORITY .............................45
13.1 Seller’s Representations and Warranties ...............................................................45
13.2 Buyer’s Representations and Warranties ...............................................................46
13.3 General Covenants .................................................................................................47
13.4 Workforce Development ........................................................................................47 ARTICLE 14 ASSIGNMENT .......................................................................................................47
14.1 General Prohibition on Assignments .....................................................................47
14.2 Collateral Assignment ............................................................................................48
14.3 Permitted Assignment by Seller.............................................................................48
14.4 Shared Facilities; Portfolio Financing ...................................................................48
Agenda Page 144
iii
14.5 Buyer Financing Assignment .................................................................................48 ARTICLE 15 DISPUTE RESOLUTION ......................................................................................49
15.1 Governing Law ......................................................................................................49
15.2 Dispute Resolution .................................................................................................49
15.3 Attorneys’ Fees ......................................................................................................49
15.4 Venue .....................................................................................................................49 ARTICLE 16 INDEMNIFICATION .............................................................................................49
16.1 Indemnification ......................................................................................................49
16.2 Claims ....................................................................................................................50 ARTICLE 17 INSURANCE ..........................................................................................................50
17.1 Insurance ................................................................................................................50 ARTICLE 18 CONFIDENTIAL INFORMATION ......................................................................52
18.1 Definition of Confidential Information ..................................................................52
18.2 Duty to Maintain Confidentiality ...........................................................................52
18.3 Irreparable Injury; Remedies .................................................................................53
18.4 Further Permitted Disclosure .................................................................................53
18.5 Press Releases ........................................................................................................53 ARTICLE 19 MISCELLANEOUS ...............................................................................................53
19.1 Entire Agreement; Integration; Exhibits ................................................................53
19.2 Amendments ..........................................................................................................54
19.3 No Waiver ..............................................................................................................54
19.4 No Agency, Partnership, Joint Venture or Lease ...................................................54
19.5 Severability ............................................................................................................54
19.6 Mobile-Sierra .........................................................................................................54
19.7 Counterparts ...........................................................................................................55
19.8 Electronic Delivery ................................................................................................55
19.9 Binding Effect ........................................................................................................55
19.10 No Recourse to Members of Buyer .......................................................................55
19.11 Forward Contract ...................................................................................................55
19.12 Change in Electric Market Design .........................................................................55
19.13 Further Assurances.................................................................................................55
19.14 Service Contract .....................................................................................................56
Agenda Page 145
iv
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 [Intentionally Omitted]
Exhibit J Form of Construction Start Date Certificate
Exhibit K Form of Letter of Credit
Exhibit L Form of Limited Assignment Agreement
Exhibit M [Intentionally Omitted]
Exhibit N Notices
Exhibit O Form of Consent to Collateral Assignment
Exhibit P [Intentionally Omitted]
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
Agenda Page 146
RENEWABLE POWER PURCHASE AGREEMENT
This Renewable Power Purchase Agreement (“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; and
WHEREAS, Seller desires to sell, and Buyer desires to purchase, on the terms and conditions set forth in this Agreement, the Product;
NOW THEREFORE, in consideration of the mutual covenants and agreements herein contained, and for other good and valuable consideration, the sufficiency and adequacy of which are hereby acknowledged, the Parties agree to the following:
ARTICLE 1
DEFINITIONS
1.1 Contract Definitions. The following terms, when used herein with initial capitalization, shall have the meanings set forth below:
“AC” means alternating current.
“Accepted Compliance Costs” has the meaning set forth in Section 3.10(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. “APC Contract Price” has the meaning set forth in Exhibit L. “Approval Application” has the meaning set forth in Section 2.1(c).
Agenda Page 147
2 “Approved Forecast Vendor” means any of (a) CAISO or (b) any other vendor reasonably acceptable to both Buyer and Seller for the purposes of providing or verifying the forecasts under Section 4.3(d).
“Assignment Agreement” has the meaning set forth in Section 14.5. “Automated Dispatch System” or “ADS” has the meaning set forth in the CAISO Tariff. “Automatic Generation Control” or “AGC” has the meaning set forth in the CAISO Tariff.
“Available Capacity” means the capacity of the Facility, expressed in whole MWs, that is available to generate Energy.
“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. “Buyer Bid Curtailment” means the occurrence of both of the following:
(a) the CAISO provides notice to a Party or the Scheduling Coordinator for the Facility, requiring the Party to deliver less Facility Energy from the Facility than the full amount of Energy forecasted in accordance with Section 4.3 to be produced from the Facility for a period of time; and
(b) for the same time period as referenced in (a), Buyer or the SC for the Facility did not submit a Self-Schedule for the MWhs subject to the reduction.
If the Facility is subject to a Planned Outage, Forced Facility Outage, Force Majeure Event and/or a Curtailment Period during the same time period as referenced in (a), then the calculation of Deemed Delivered Energy during such period shall not include any Facility Energy that was not generated or stored due to such Planned Outage, Forced Facility Outage, Force Majeure Event or Curtailment Period.
Agenda Page 148
3 “Buyer Curtailment Order” means the instruction from Buyer to Seller to reduce Facility Energy from the Facility by the amount, and for the period of time set forth in such instruction, for reasons unrelated to a Planned Outage, Forced Facility Outage, Force Majeure Event affecting the Facility and/or Curtailment Order.
“Buyer Curtailment Period” means the period of time, as measured using current Settlement Intervals, during which Seller reduces Facility Energy from the Facility pursuant to or as a result of (a) a Buyer Bid Curtailment, (b) a Buyer Curtailment Order, or (c) a Buyer Default hereunder which directly causes Seller to be unable to deliver Energy to the Delivery Point; provided, the duration of any Buyer Curtailment Period shall be inclusive of the time required for the Facility to ramp down and ramp up.
“Buyer Default” means an Event of Default of Buyer.
“Buyer’s Indemnified Parties” has the meaning set forth in Section 18.2. “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.
“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 associated with such generating units, that are applicable to the Facility.
“CAISO Charges Invoice” has the meaning set forth in Exhibit D. “CAISO Commercial Operation” has the meaning of “Commercial Operation” set forth in the CAISO Tariff.
“CAISO Grid” has the same meaning as “CAISO Controlled Grid” as defined in the CAISO Tariff.
“CAISO Resource ID” has the same meaning as “Resource ID” 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.
Agenda Page 149
4 “CEC” means the California Energy Commission or its successor agency. “CEC Certification and Verification” means that the CEC has certified (or, with respect to periods before the date that is one hundred eighty (180) days following the Commercial Operation Date, that the CEC has pre-certified) that the Facility is an Eligible Renewable Energy Resource for purposes of the California Renewables Portfolio Standard and that all Facility Energy delivered to the Delivery Point qualifies as generation from an Eligible Renewable Energy Resource.
“CEC Precertification” means that the CEC has issued a precertification for the Facility indicating that the planned operations of the Facility would comply with applicable CEC requirements for CEC Certification and Verification.
“Change of Control” means, except in connection with public market transactions of equity interests or capital stock of Seller’s Ultimate Parent, any circumstance in which Ultimate Parent ceases to own, directly or indirectly through one or more intermediate entities, more than fifty percent (50%) of the outstanding equity interests in Seller; provided, in calculating ownership percentages for all purposes of the foregoing:
(a) any ownership interest in Seller held by Ultimate Parent indirectly through one or more intermediate entities shall not be counted towards Ultimate Parent’s ownership interest in Seller unless Ultimate Parent directly or indirectly owns more than fifty percent (50%) of the outstanding equity interests in each such intermediate entity; and (b) ownership interests in Seller owned directly or indirectly by any Lender (including any tax equity provider) shall be excluded from the total outstanding equity interests in Seller.
“COD Certificate” 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) ninety (90). “Compliance Actions” has the meaning set forth in Section 3.10(a). “Compliance Expenditure Cap” has the meaning set forth in Section 3.10. “Confidential Information” has the meaning set forth in Section 18.1. “Consent to Collateral Assignment” has the meaning set forth in Section 14.2. “Construction Start” has the meaning set forth in Exhibit B. “Construction Start Date” has the meaning set forth in Exhibit B.
Agenda Page 150
5 “Contract Term” has the meaning set forth in Section 2.1. “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 epidemic 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.
“CPUC” means the California Public Utilities Commission, or successor entity. “CPUC Approval” means a final and non-appealable order, decision, or disposition of the CPUC, without conditions or modifications unacceptable to the Parties, or either of them, which approves this Agreement in its entirety, including payments to be made by Buyer, subject to CPUC review of Buyer’s administration of this Agreement. CPUC Approval will be deemed to have occurred on the date that a CPUC order, decision, or disposition containing such findings becomes final and non-appealable.
“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, 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 Buyer or the SC for the Facility submitted a Self-Schedule for the MWhs curtailed corresponding to the MWhs in the VER forecast for the Facility during the relevant time period; (b) a curtailment ordered by the Transmission Provider for reasons including, but not limited to, (i) any situation that affects normal function of the electric system including,
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6 but not limited to, any abnormal condition that requires action to prevent circumstances such as equipment damage, loss of load, or abnormal voltage conditions, or (ii) any warning, forecast or anticipation of conditions or situations that jeopardize the Transmission Provider’s electric system integrity or the integrity of other systems to which the Transmission Provider is connected; (c) a curtailment ordered by CAISO or the Transmission Provider due to a Transmission System Outage; or
(d) a curtailment in accordance with Seller’s obligations under its Interconnection Agreement with the Transmission Provider or distribution operator. “Curtailment Period” means the period of time, as measured using current Settlement Intervals, during which Seller reduces generation 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.
“Daily Delay Damages” means an amount equal to (a) the Development Security amount required hereunder, divided by (b) one hundred twenty (120). “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). “Day-Ahead Forecast” has the meaning set forth in Section 4.3(c). “Day-Ahead Market” has the meaning set forth in the CAISO Tariff. “Day-Ahead Schedule” has the meaning set forth in the CAISO Tariff. “Deemed Delivered Energy” means the amount of Energy expressed in MWh that the Facility would have produced and delivered to the Facility Meter, but that is not produced by the Facility during a Buyer Curtailment Period, which amount shall be equal to the Real-Time Forecast (of the hourly expected Facility Energy produced by the Facility) provided pursuant to Section
4.3(d) for the period of time during the Buyer Curtailment Period (or other relevant period), less the amount of Facility Energy delivered to the Delivery Point during the Buyer Curtailment Period (or other relevant period); provided, if the applicable difference is negative, the Deemed Delivered Energy shall be zero (0).
“Defaulting Party” has the meaning set forth in Section 11.1(a). “Deficient Month” has the meaning set forth in Section 4.8(e). “Delay Damages” means Daily Delay Damages and Commercial Operation Delay Damages.
“Delivery Point” has the meaning set forth in Exhibit A.
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7 “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 (a) cash or (b) a Letter of Credit in the amount specified for the Development Security on the Cover Sheet.
“Disadvantaged Communities” or “DAC” has the meaning set forth in CPUC Decision 18-06-027 as communities that are defined in the CalEnviroScreen 4.0 (or any successor version) as among the top twenty-five percent (25%) of census tracts statewide, plus the census tracts in the highest five percent (5%) of CalEnviroScreen’s Pollution Burden that do not have an overall CalEnviroScreen score because of unreliable socioeconomic or health data. “Disclosing Party” has the meaning set forth in Section18.2. “Distribution Provider” has the meaning set forth in Exhibit A. “Early Termination Date” has the meaning set forth in Section 11.2(a). “Effective Date” has the meaning set forth on the Preamble. “Electrical Losses” means all transmission or transformation losses between the Facility and the Delivery Point associated with delivery of Facility Energy. “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. “Event of Default” has the meaning set forth in Section 11.1. “Excess MWh” has the meaning set forth in Exhibit C.
“Expected Commercial Operation Date” has the meaning set forth on the Cover Sheet. “Expected Construction Start Date” has the meaning set forth on the Cover Sheet. “Expected Energy” means the quantity of Energy that Seller expects to be able to deliver to Buyer from the Facility during each Contract Year, which for each Contract Year is the quantity specified on the Cover Sheet, which amount shall be adjusted proportionately to the reduction from Guaranteed Capacity to Installed Capacity pursuant to Section 5(a) of Exhibit B, if applicable.
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8 “Facility” means the solar photovoltaic generating facility described on the Cover Sheet and in Exhibit A, located at the Site and including mechanical equipment and associated facilities and equipment required to deliver Facility Energy to the Delivery Point. “Facility Energy” means the Energy during any Settlement Interval or Settlement Period, net of Electrical Losses and Station Use and, if accepted by the CAISO for settlement purposes, as adjusted to reflect Distribution Provider’s Real Power Loss Factor. Facility Energy shall be measured by the Facility Meter.
“Facility Meter” means the CAISO approved revenue quality meter or meters, CAISO approved data processing gateway or remote intelligence gateway, telemetering equipment and data acquisition services sufficient for monitoring, recording and reporting, in real time, all Facility Energy. Without limiting Seller’s obligation to deliver Facility Energy to the Delivery Point, the Facility Meter will be located, and Facility Energy will be measured, at the high voltage side of the main step-up transformer and will be subject to adjustment to measure Facility Energy at the Delivery Point in accordance with CAISO meter requirements and Prudent Operating Practices to account for Electrical Losses and, if accepted by the CAISO for settlement purposes, adjustments to reflect Distribution Provider’s Real Power Loss Factor. “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. “Financial Close” means Seller and/or one 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).
“Force Majeure Event” has the meaning set forth in Section 10.1. “Forced Facility Outage” means an unexpected failure of one or more components of the Facility that prevents Seller from generating Energy or making Facility Energy available at the Delivery Point and that is not the result of a Force Majeure Event. “Forecasted Product” has the meaning set forth in Section 4.3(b). “Forecasting Penalty” has the meaning set forth in Section 4.3(f). “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
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9 in determining the economic benefit to a Party may include, without limitation, reference to information supplied by one or more third parties, which shall exclude Affiliates of the Non-Defaulting Party, including without limitation, quotations (either firm or indicative) of relevant rates, prices, yields, yield curves, volatilities, spreads or other relevant market data in the relevant markets, comparable transactions, forward price curves based on economic analysis of the relevant markets, settlement prices for comparable transactions at liquid trading hubs (e.g., SP-15), all of which should be calculated for the remaining Contract Term, and include the value of Green Attributes.
“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 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 with the Facility that are applicable to a state or federal income taxation obligation, 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.
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10 “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 3.4, updated April 27, 2023, as may be further amended from time to time. “Guaranteed Capacity” means the generating capacity of the Facility, as measured in MW AC at the Delivery Point, that Seller commits to install pursuant to this Agreement 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 Construction Start 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. “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.
“Imbalance Reserves” has the meaning set forth in the CAISO Tariff. “Indemnified Party” has the meaning set forth in Section 16.1. “Indemnifying Party” has the meaning set forth in Section 16.1. “Initial Synchronization” means the commencement of Trial Operations (as defined in the CAISO Tariff).
“Installed Capacity” means the actual generating capacity of the Facility, as measured in MW AC at the Delivery Point (i.e., measured at the Facility Meter and adjusted for Electrical Losses and Real Power Loss Factor to the Delivery Point), that achieves Commercial Operation, as evidenced by a certificate substantially in the form attached as Exhibit H hereto. “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 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. “Interconnection Capacity Limit” means the maximum instantaneous amount of Energy that is permitted to be delivered to the Delivery Point under Seller’s Interconnection Agreement, in the amount of 4.0 MW.
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11 “Interconnection Facilities” means the interconnection facilities, control and protective devices and metering facilities required to connect the Facility with the Transmission System in accordance with the Interconnection Agreement.
“Interest Rate” has the meaning set forth in Section 8.2. “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.
“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, maintenance, 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, in a form substantially similar to the letter of credit set forth in Exhibit K with any modifications approved by the Buyer.
“Licensed Professional Engineer” means an independent, professional engineer selected by Seller and reasonably acceptable to Buyer, licensed in the State of California. “Locational Marginal Price” or “LMP” has the meaning set forth in the CAISO Tariff.
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12 “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, and Renewable Energy Incentives. For the avoidance of doubt, in the case of Seller as the Non-Defaulting Party, Losses shall include the value of any loss, recapture or inability to claim all or any portion of the Tax Credits associated with the Facility, determined on an after-tax basis, that are a direct or indirect result of a Buyer Event of Default and for which Seller was not capable of mitigating through the use of any reasonable efforts. Without limiting any of the foregoing, any Losses claimed by Party shall be actual, documented, and verifiable. “Lost Output” has the meaning set forth in Section 4.7. “Low-Income Community Bonus” has the meaning set forth in H.R. 5376 Section 13103. “Material Permits” means all permits required for Seller to commence construction, as set forth on Exhibit S.
“Milestones” means the significant permitting, interconnection, financing and construction milestones 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 Facility’s PNode is less than zero dollars ($0).
“NERC” means the North American Electric Reliability Corporation or any successor entity.
“Network Upgrades” has the meaning set forth in the CAISO Tariff. “Non-Defaulting Party” has the meaning set forth in Section 11.2.
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13 “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).
“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 Contract Year. “Performance Security” means (a) cash or (b) a Letter of Credit in the amount specified for the Development Security on the Cover Sheet.
“Permitted Transferee” means (a) any Affiliate of Seller or (b) any entity that satisfies, or is controlled by another Person that satisfies, the following requirements:
(i) A tangible net worth of not less than fifty million dollars ($50,000,000) or a Credit Rating of at least BBB- from S&P, BBB- from Fitch, or Baa3 from Moody’s; and (ii) At least two (2) years of experience in the ownership and operations of power generation facilities similar to the Facility, 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.
“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 Section 4.6(a).
“PNode” has the meaning set forth in the CAISO Tariff.
“Point of Receipt” is a term used in Distribution Provider’s Wholesale Distribution Access Tariff and means Delivery Point.
“Portfolio” means the single portfolio of electrical energy generating or other assets and entities, including the Facility (or the interests of Seller or Seller’s Affiliates or the interests of their respective direct or indirect parent companies), that is pledged as collateral security in connection with a Portfolio Financing.
“Portfolio Content Category” means PCC1, PCC2 or PCC3, as applicable. “Portfolio Content Category 1” or “PCC1” means any Renewable Energy Credit associated with the generation of electricity from an Eligible Renewable Energy Resource consisting of the portfolio content set forth in California Public Utilities Code Section 399.16(b)(1), as may be amended from time to time or as further defined or supplemented by Law.
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14 “Portfolio Content Category 2” or “PCC2” means any Renewable Energy Credit associated with the generation of electricity from an Eligible Renewable Energy Resource consisting of the portfolio content set forth in California Public Utilities Code Section 399.16(b)(2), as may be amended from time to time or as further defined or supplemented by Law. “Portfolio Content Category 3” or “PCC3” means any Renewable Energy Credit associated with the generation of electricity from an Eligible Renewable Energy Resource consisting of the portfolio content set forth in California Public Utilities Code Section 399.16(b)(3), as may be amended from time to time or as further defined or supplemented by Law. “Portfolio Financing” means any debt incurred by an Affiliate of Seller that is secured only by a Portfolio.
“Portfolio Financing Entity” means any Affiliate of Seller that incurs debt in connection with any Portfolio Financing.
“Product” has the meaning set forth on the Cover Sheet. “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 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 practices, reliability, safety and expedition. Prudent Operating Practice is not intended to be limited to the optimum practice, method or act to the exclusion of all others, but rather to acceptable practices, methods or acts generally accepted in the industry with respect to grid-interconnected, utility-scale generating facilities 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.
“Real Power Loss Factor” has the meaning set forth in Distribution Provider’s Wholesale Distribution Access Tariff (WDAT), or its equivalent, and is set, as of the Effective Date, as a
3.73% credit for the output at the Point of Receipt. If the Real Power Loss Factor is changed in the Distribution Provider’s FERC approved WDAT and the Facility Meter is reprogrammed to reflect a revised credit value, this Agreement will be amended to reflect such change.
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15 “Real Power Loss Factor Multiplier” means a value equal to one plus the Real Power Loss Factor percentage, or, as of the Effective Date, 1.0373. “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. “Receiving Party” has the meaning set forth in Section 18.2. “Recurring Certificate Transfers” has the meaning set forth in Section 4.8(a). “Reliability Network Upgrades” has the meaning set forth in the CAISO Tariff. “Remedial Action Plan” has the meaning set forth in Section 2.4. “Renewable Energy Credit” has the meaning set forth in California Public Utilities Code Section 399.12(h), as may be amended from time to time or as further defined or supplemented by Law.
“Renewable Energy Incentives” means: (a) all federal, state, or local Tax credits or other Tax benefits associated with the construction, ownership, or production of electricity from the 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 any attributes related to capacity markets including resource adequacy or any successor programs.
“Renewable Rate” has the meaning set forth on the Cover Sheet; provided, if the officer’s certificate provided by Seller pursuant to Section 2.2(k) states that Seller will claim a Tax Credit rate for the Facility that is higher than Seller’s assumed Tax Credit rate as set forth on the Cover Sheet, the Renewable Rate shall be reduced by (a) $ /MWh for each one (1) percentage point that the claimed ITC rate is above zero percent (0%) or (b) $ /MWh for each $ /kWh that the PTC rate is above $ /kWh. By way of example, if Seller is able to obtain ITCs for 40% of the eligible basis of the Facility, then the rate shall be $ /MWH. If Seller is able to obtain ITCs for 30% of the eligible basis of the Facility, then the rate shall be $ /MWH if Seller is not able to obtain such ITC the Renewable Rate remains $ /MWH. By way of example, if Seller is able to obtain PTCs for $ per kWh, then the rate shall be $ MWh. “Replacement Energy” has the meaning set forth in Exhibit G. “Replacement Green Attributes” has the meaning set forth in Exhibit G.
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16 “Replacement Product” has the meaning set forth in Exhibit G. “Requested Confidential Information” has the meaning set forth in Section 18.2. “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 that clears under the applicable CAISO market based on the final Day-Ahead Schedule (as defined in the CAISO Tariff), 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.
“Scheduling Coordinator” or “SC” means an entity certified by the CAISO as qualifying as a Scheduling Coordinator pursuant to the CAISO Tariff for the purposes of undertaking the functions specified in “Responsibilities of a Scheduling Coordinator,” of the CAISO Tariff, as amended from time to time.
“Security Interest” has the meaning set forth in Section 8.9. “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.
“Site” means the real property on which the Facility is or will be located, as further described in Exhibit A, and as shall be updated by Seller at the time Seller provides an executed
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17 Construction Start Date certificate in the form of Exhibit J to Buyer; 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, for the Contract Term, Seller (or, prior to the Delivery Term, its Affiliate): (a) owns or has the option to purchase the Site; (b) is the lessee or has the option to lease the Site; or (c) is the holder of an easement or an option for an easement, right-of-way grant, or similar instrument with respect to the Site.
“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. “Supply Chain Code” has the meaning in Exhibit Q.
“System Emergency” means any condition that requires, as determined and declared by CAISO or the Transmission Provider, automatic or immediate action to (a) prevent or limit harm to or loss of life or property, (b) prevent loss of transmission facilities or generation supply in the immediate vicinity of the Facility, or (c) 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). “Test Energy” means Facility Energy delivered (a) commencing on the later of (i) the first date that the CAISO informs Seller in writing that Seller may deliver Energy to the CAISO and (ii) the first date that the Transmission Provider informs Seller in writing that Seller has conditional or temporary permission to operate in parallel with the CAISO Grid, and (b) ending upon the occurrence of the Commercial Operation Date.
“Test Energy Rate” has the meaning set forth in Section 3.6. “Transmission Provider” means any entity that owns, operates and maintains transmission or distribution lines and associated facilities and/or has entitlements to use certain
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18 transmission or distribution lines and associated facilities for the purpose of transmitting or transporting the Facility Energy from the Delivery Point. “Transmission System” means the transmission facilities operated by the CAISO, now or hereafter in existence, which provide energy transmission service downstream from the Delivery Point.
“Transmission System Outage” means an outage on the Transmission System, other than a System Emergency, that is not caused by Seller’s actions or inactions and that prevents Buyer or the CAISO (as applicable) from receiving Facility Energy onto the Transmission System. “Ultimate Parent” means Saticoy Sun Farms LLC, a California limited liability company. “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.
1.2 Rules of Interpretation In this Agreement, except as expressly stated otherwise or unless the context otherwise requires:
(a) headings and the rendering of text in bold and italics are for convenience and reference purposes only and do not affect the meaning or interpretation of this Agreement; (b) words importing the singular include the plural and vice versa and the masculine, feminine and neuter genders include all genders; (c) the words “hereof”, “herein”, and “hereunder” and words of similar import shall refer to this Agreement as a whole and not to any particular provision of this Agreement; (d) a reference to an Article, Section, paragraph, clause, Party, or Exhibit is a reference to that 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,
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19 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 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) The term of this Agreement shall commence on the Effective Date and shall remain in full force and effect until the conclusion of the Delivery Term, subject to any early termination provisions 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.
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20 (b) Applicable provisions of this Agreement shall continue in effect after termination, including early termination, to the extent necessary to enforce or complete the duties, obligations or responsibilities of the Parties arising prior to termination. The confidentiality obligations of the Parties under Article 18 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. (c) Within one hundred eighty (180) days following Seller’s receipt of notification from Buyer that Seller was shortlisted by Buyer for negotiation of this Agreement, or such later timeframe as may be approved by the director of the CPUC Energy Division or his/her/their designee, Buyer will submit this Agreement to the CPUC via a Tier 2 advice letter seeking an order that, after issuance and the passage of time, would constitute a CPUC Approval (“Approval Application”). Seller agrees to cooperate with Buyer in preparing and filing the Approval Application and to actively support that application, as reasonably requested by Buyer.
If CPUC Approval of this Agreement is not obtained within one hundred eighty (180) days following the Effective Date, then either Party may terminate this Agreement upon written Notice to the other Party. Upon such termination, neither Party shall have any liability to the other Party, save and except for those obligations specified in Section 2.1, and Buyer shall promptly return to Seller any Development Security then held by Buyer, less any amounts drawn in accordance with this Agreement.
2.2 Conditions Precedent. 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 five (5) Business Days of the expected Commercial Operation 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:
(a) Seller shall have delivered to Buyer (i) a completion certificate from a Licensed Professional Engineer substantially in the form of Exhibit H; (b) A Participating Generator Agreement and a Meter Service Agreement between Seller and CAISO shall have been executed and delivered and be in full force and effect, and a copy of each such agreement delivered to Buyer;
(c) An Interconnection Agreement between Seller and the Transmission Provider shall have been executed and delivered and be in full force and effect and a copy of the Interconnection Agreement delivered to Buyer;
(d) All applicable regulatory authorizations, approvals and permits 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;
(e) Seller has received CEC Precertification of the Facility (and reasonably expects to receive final CEC Certification and Verification for the Facility in no more than one hundred eighty (180) days from the Commercial Operation Date); (f) Seller has obtained CAISO Certification for the Facility;
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21 (g) 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;
(h) Seller has delivered the Performance Security to Buyer in accordance with Section 8.8;
(i) Seller has taken all actions and executed all documents and instruments, required to authorize Buyer (or its designated agent) to act as Scheduling Coordinator under this Agreement and to fully enable the Facility to be Scheduled by Buyer, and Buyer (or its designated agent) is authorized to act as Scheduling Coordinator;
(j) Seller has delivered to Buyer an officer’s certificate stating (i) 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 (ii) the Tax Credit and applicable rate which Seller claims will apply for the Facility and/or Facility Energy; and (k) Seller has paid Buyer for all amounts owing under this Agreement, if any, including Delay Damages.
2.3 Development; Construction; Progress Reports.
(a) Within fifteen (15) days after the close of (i) each calendar quarter from the first calendar quarter following the Effective Date until the Construction Start Date, and (ii) each calendar month from the first calendar month following the Construction Start Date until the Commercial Operation Date, Seller shall provide to Buyer a Progress Report (both a clean version and a version redlined against the immediately prior 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 (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 consistent with Seller’s duty of good faith and fair dealing to (i) ensure that all materials, products and components used in constructing, installing and operating the Facility throughout the Term are in compliance with the Supply Chain Code of Conduct (Exhibit P), and (ii) include contract provisions materially similar to those set forth in the Supply Chain Code of Conduct in all contracts entered by it or its Affiliates for the construction, installation, and operation of the Facility. Seller shall notify Buyer as soon as it becomes aware of any breach, or potential breach, of its obligations under this Section
2.3(b).
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22 (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).
2.4 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, Seller shall submit to Buyer, within fifteen (15) 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 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; 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.
2.5 Low-Income Community Bonus. Seller shall make commercially reasonable efforts to qualify for and receive the Low-Income Community Bonus. Seller shall give Notice to Buyer within five (5) Business Days of Seller’s receipt of notice from any Governmental Authority regarding the outcome of Seller’s request or application to receive such Low-Income Community Bonus. Buyer shall use commercially reasonable efforts to provide information reasonably requested by Seller in support of Seller’s obligations pursuant to this Section 2.5.
ARTICLE 3
PURCHASE AND SALE
3.1 Purchase and Sale of Product. Subject to the terms and conditions of this Agreement, during the Delivery Term, Buyer shall purchase all the Product produced by or associated with the Facility at the Renewable 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. At its sole discretion, Buyer may during the Delivery Term re-sell or use for another purpose all or a portion of the Product; provided, 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.
3.2 Sale of Green Attributes. During the Delivery Term, Seller shall sell and deliver to Buyer, and Buyer shall purchase from Seller, all Green Attributes attributable to the Facility Energy. 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.
3.3 Imbalance Energy. Buyer and Seller recognize that in any given Settlement Period the amount of Facility Energy may deviate from the amounts thereof scheduled with the CAISO.
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23 Following CAISO Commercial Operation, to the extent there are such deviations, any costs, liabilities or revenues from such imbalances shall be solely for the account of Buyer, except as expressly set forth in this Agreement.
3.4 Ownership of Renewable Energy Incentives. Seller shall have all right, title and interest in and to all Renewable Energy Incentives. Buyer acknowledges that any Renewable Energy Incentives belong to Seller. If any Renewable Energy Incentives, or values representing the same, are initially credited or paid to Buyer, Buyer shall cause such Renewable Energy Incentives or values relating to same to be assigned or transferred to Seller without delay. Buyer shall reasonably cooperate with Seller, at Seller’s sole expense, in Seller’s efforts to meet the requirements for any certification, registration, or reporting program relating to Renewable Energy Incentives.
3.5 Future Environmental Attributes.
(a) The Parties acknowledge and agree that as of the Effective Date, environmental attributes sold under this Agreement are restricted to Green Attributes; however, Future Environmental Attributes may be created by a Governmental Authority through Laws enacted after the Effective Date. Subject to the final sentence of this Section 3.5(a) and 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 Renewable 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.
3.6 Test Energy. No less than fourteen (14) days prior to the first day on which Test Energy is expected to be available from the Facility, Seller shall notify Buyer of the availability of the Test Energy. If and to the extent the Facility generates Test Energy, Seller shall sell and Buyer shall purchase from Seller all Test Energy and any associated Products on an as-available basis for up to one hundred eighty (180 days) from the first delivery of Test Energy. As compensation for such Test Energy and associated Product, Buyer shall pay Seller an amount equal to seventy percent (70%) of the Renewable Rate, and thereafter zero dollars ($0) per MWh (the “Test Energy Rate”). The conditions precedent in Section 2.2 are not applicable to the Parties’ obligations under this Section 3.6.
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24 3.7 CEC Certification and Verification. Subject to Section 3.10 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 throughout the Delivery Term, 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 CEC Precertification by the Commercial Operation Date. Within thirty (30) days after the Commercial Operation Date, Seller shall apply with the CEC for final CEC Certification and Verification. Within one hundred eighty (180) days after the Commercial Operation Date, Seller shall obtain and maintain throughout the remainder of the Delivery Term the final CEC Certification and Verification which deadline shall be extended on a day-for-day basis if there is any delay in CEC Certification and Verification and such delay is caused by any reason other than an act of omission of Seller, as reasonably demonstrated to Buyer. 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.
3.8 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]
3.9 California Renewables Portfolio Standard. Subject to Section 3.10, 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.
3.10 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 that are made subject to this Section 3.10, including with respect to obtaining, maintaining, conveying or effectuating Buyer’s use of Green Attributes, 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,
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25 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 3.10 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 Compliance Actions, not to exceed the Accepted Compliance Costs, within sixty (60) days from the time that Buyer receives an invoice and documentation of such costs from Seller.
3.11 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; 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 as set forth in a written agreement.
ARTICLE 4
OBLIGATIONS AND DELIVERIES
4.1 Delivery.
(a) Energy. Subject to the provisions of this Agreement, commencing on the Commercial Operation Date through the end of the Contract Term, Seller shall supply and deliver the Product to Buyer at the Delivery Point, and Buyer shall take delivery of the Product at the Delivery Point in accordance with the terms of this Agreement. Seller shall be responsible for paying or satisfying when due any costs or charges imposed in connection with the delivery of Facility Energy to the Delivery Point, including 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 and imbalance charges. The Facility Energy will be scheduled with the CAISO by Buyer (or Buyer’s designated Scheduling Coordinator) in accordance with Exhibit D.
(b) Green Attributes. All Green Attributes associated with Test Energy and the Facility Energy during the Delivery Term are exclusively dedicated to and vested in Buyer. Seller represents and warrants that Seller holds the rights to all Green Attributes from the Facility, and Seller agrees to convey and hereby conveys all such Green Attributes to Buyer as included in the delivery of the Product from the Facility.
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26 (c) Energy Products. If, at any time during the Contract Term, Buyer requests Seller to provide any new or different Energy-related products or Ancillary Services (as defined in the CAISO Tariff) 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 or liabilities) on Seller or the Facility or Seller’s obligations or liabilities under this Agreement, then Seller shall use commercially reasonable efforts to 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 or liabilities) on Seller or the Facility or Seller’s obligations or liabilities under this 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.
4.3 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).
(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 beginning of each calendar year for every subsequent Contract Year during the Delivery Term, Seller shall provide to Buyer and the SC (if applicable) a non-binding forecast of each month’s average-day expected 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 ten (10) Business Days before the beginning of each month during the Delivery Term, Seller shall provide to Buyer and the SC (if applicable) a non-binding forecast of the hourly expected (i) available capacity of the Facility and (ii) Facility Energy (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. By 5:30 AM Pacific Prevailing Time on the Business Day immediately preceding the date of delivery, or as otherwise specified by Buyer consistent with Prudent Operating Practice, Seller shall provide Buyer with a non-binding forecast of the hourly expected Forecasted Product, in each case, for each hour of the immediately succeeding day (“Day-Ahead Forecast”). A Day-Ahead Forecast provided in a day prior to any non-Business
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27 Day(s) shall include non-binding forecasts for the immediate day, each succeeding non-Business Day, and the next Business Day. Each Day-Ahead Forecast shall clearly identify, for each hour, Seller’s best estimate of the hourly expected Forecasted Product. Such Day-Ahead Forecasts shall be sent to Buyer’s on-duty Scheduling Coordinator. If Seller fails to provide Buyer with a Day-Ahead Forecast as required herein for any period, then for such unscheduled delivery period only, Buyer shall rely on any Real-Time Forecast or the Monthly Forecast or Buyer’s best estimate based on information reasonably available to Buyer.
(d) Real-Time Forecasts. During the Delivery Term, Seller shall notify Buyer of any changes from the Day-Ahead Forecast of one (1) MW / one (1) MWh or more in the hourly expected Forecasted Product (“Real-Time Forecast”), in each case, whether due to a Forced Facility Outage, Force Majeure Event or other cause, as soon as reasonably possible, but no later than one (1) hour prior to the deadline for submitting schedules to the CAISO in accordance with the rules for participation in the Real-Time Market. If the Forecasted Product changes by at least one (1) MW as of a time that is less than one (1) hour prior to the Real-Time Market deadline, but before such deadline, then Seller must notify Buyer as soon as reasonably possible. Such Real-Time Forecasts of Facility Energy shall be provided by an Approved Forecast Vendor and shall contain information regarding the beginning date and time of the event resulting in the change in any Forecasted Product, as applicable, the expected end date and time of such event, and any other information required by the CAISO or reasonably requested by Buyer. With respect to any Forced Facility Outage, Seller shall use commercially reasonable efforts to notify Buyer of such outage within ten (10) minutes of the commencement of the Forced Facility Outage. Seller shall inform Buyer of any developments that 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 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) Forced Facility Outages. Notwithstanding anything to the contrary herein, Seller shall promptly notify Buyer’s on-duty Scheduling Coordinator of Forced Facility Outages and Seller shall keep Buyer informed of any developments that will affect either the duration of the outage or the availability of the Facility during or after the end of the outage. (f) Forecasting Penalties. In the event Seller does not in a given hour provide the forecast required in Section 4.3(d) and Buyer incurs a loss or penalty resulting from its scheduling activities with respect to Facility Energy during such hour, Seller shall be responsible for a “Forecasting Penalty” for each such hour equal to the product of (A) the absolute difference (if any) between (i) the expected Facility Energy for such hour set forth in the Day Ahead Forecast, and (ii) the actual Facility Energy, multiplied by (B) the absolute value of the Real-Time Price in such hour. Settlement of Forecasting Penalties shall occur as set forth in Article 8 of this Agreement.
(g) CAISO Tariff Requirements. Seller shall comply with all applicable obligations for Variable Energy Resources under the CAISO Tariff and the Eligible Intermittent Resource Protocol, including providing appropriate operational data and meteorological data, and
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28 will fully cooperate with Buyer, Buyer’s SC, and CAISO, in providing all data, information, and authorizations required thereunder.
4.4 Dispatch Down/Curtailment.
(a) General. 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, Buyer Curtailment Order, or notice received from CAISO in respect of a Buyer Bid Curtailment. (b) Buyer Curtailment. Buyer shall have the right to order Seller to curtail deliveries of Facility Energy through Buyer Curtailment Orders; provided, Buyer shall pay Seller for all Deemed Delivered Energy associated with a Buyer Curtailment Period at the Renewable Rate.
(c) Failure to Comply. If Seller fails to comply with a Buyer Curtailment Order, Buyer Bid Curtailment or Curtailment Order, then, for each MWh of Facility Energy that is delivered by the Facility to the Delivery Point that is in excess of the Buyer Curtailment Order, Buyer Bid Curtailment or Curtailment Order, Seller shall pay Buyer for each such MWh at an amount equal to the sum of (A) + (B) + (C), where: (A) is the amount, if any, paid to Seller by Buyer for delivery of such excess MWh, (B) is the sum, for all Settlement Intervals with a Negative LMP during the Buyer Curtailment Period or Curtailment Period, of the absolute value of the product of such excess MWh in each Settlement Interval and the Negative LMP for such Settlement Interval, and (C) is any penalties assessed by the CAISO or other charges assessed by the CAISO resulting from Seller’s failure to comply with the Buyer Curtailment Order, Buyer Bid Curtailment or Curtailment Order.
(d) Seller Equipment Required for Operating Instruction Communications.
Seller shall acquire, install, and maintain such facilities, communications links and other equipment, and implement such protocols and practices, as necessary to respond to and follow operating instructions from the CAISO and Buyer's SC, including an electronic signal conveying real time and intra-day instructions, to operate the Facility as directed by Buyer from time to time in accordance with this Agreement and/or a Governmental Authority, including to implement a Buyer Curtailment Order, Buyer Bid Curtailment or Curtailment Order in accordance with the methodologies applicable to the Facility and used to transmit such instructions. If at any time during the Delivery Term, Seller’s facilities, communications links or other equipment, protocols or practices are not in compliance with methodologies applicable to the Facility and directed by Buyer, Seller shall take the steps necessary to become compliant as soon as commercially reasonably possible. Seller shall be liable pursuant to Section 4.4(c) for failure to comply with a Buyer Curtailment Order, Buyer Bid Curtailment or Curtailment Order, during the time that Seller’s facilities, communications links or other equipment, protocols or practices are not in compliance with applicable methodologies. A Buyer Curtailment Order, Buyer Bid Curtailment or Curtailment Order communication via such systems and facilities shall have the same force and effect on Seller as any other form of communication.
4.5 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 any Energy used to serve Station Use), (ii) the supply of such Station
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29 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).
4.6 Facility Maintenance. Without limiting Section 3.1 or Exhibit G:
(a) Seller shall provide to Buyer written schedules for Planned Outages for each Contract Year no later than thirty (30) days prior to the first day of the applicable Contract 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 deliver to Buyer the final updated schedule of Planned Outages no later than ten (10) days after receiving Buyer’s comments. 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)(i).
(c) Notwithstanding anything in this Agreement to the contrary, no Planned Outages of the Facility shall be scheduled or planned from each June 1 through October 31 during the Delivery Term, unless approved by Buyer in writing in its sole discretion. In the event that Seller has a previously Planned Outage that becomes coincident with a System Emergency, Seller shall make all reasonable efforts to reschedule such Planned Outage.
4.7 Guaranteed Energy Production. 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 one hundred sixty percent (160%) of the average annual Expected Energy for the two (2) Contract Years constituting such Performance Measurement Period. Seller shall be excused from achieving the Guaranteed Energy Production during any Performance Measurement Period only to the extent of any Buyer Default or other Buyer failure to perform that directly prevents Seller from being able to deliver Facility Energy to the Delivery Point. For purposes of determining whether Seller has achieved the Guaranteed Energy Production, 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 Force Majeure Events, System Emergency, Transmission System Outage, or Curtailment Periods (“Lost Output”). If Seller fails to achieve the Guaranteed Energy Production amount in any Performance Measurement Period, Seller shall pay Buyer damages calculated in accordance with Exhibit G (“Energy Replacement Damages”); provided, Seller may, as an alternative, provide Replacement Product (as defined in Exhibit G) delivered to Buyer at SP 15 EZ Gen Hub under a Day-Ahead Schedule as an IST within ninety (90) days after the conclusion of the applicable
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30 Performance Measurement Period (i) upon a schedule reasonably acceptable to Buyer, (ii) provided that such deliveries do not impose additional costs upon Buyer for which Seller refuses to provide reimbursement, and (iii) not to exceed ten percent (10%) of the Expected Energy for the previous Contract Year.
4.8 WREGIS. Seller shall, at its sole expense, but subject to Section 3.10, 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. Seller shall transfer the Renewable Energy Credits to Buyer. Seller shall comply with all Laws, including the WREGIS Operating Rules, regarding the certification and transfer of such WREGIS Certificates to Buyer and Buyer shall be given sole title to all such WREGIS Certificates. Seller shall be deemed to have satisfied the warranty in Section 4.8(g), provided that Seller fulfills its obligations under Sections
4.8(a) through (g) below. In addition:
(a) Prior to the Commercial Operation Date, Seller shall register the Facility with WREGIS and establish an account with WREGIS (“Seller’s WREGIS Account”), which Seller shall maintain until the end of the Delivery Term. Seller shall transfer the WREGIS Certificates using “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.
(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
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31 the amount of Facility Energy in the Deficient Month shall be reduced by three (3) times the amount of the WREGIS Certificate Deficit for purposes of calculating Buyer’s payment to Seller under Article 8 and the Guaranteed Energy Production for the applicable Contract Year; provided, such adjustment shall not apply to the extent that Seller either (x) resolves the WREGIS Certificate Deficit within ninety (90) days after the Deficient Month or (y) provides Replacement Green Attributes (as defined in Exhibit G) within ninety (90) days after the Deficient Month (i) upon a schedule reasonably acceptable to Buyer, and (ii) provided that such deliveries do not impose additional costs upon Buyer for which Seller has not reimbursed Buyer. Without limiting Seller’s obligations under this Section 4.8, if a WREGIS Certificate Deficit is caused solely by an error or omission of WREGIS, the Parties shall cooperate in good faith to cause WREGIS to correct its error or omission.
(f) If 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 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 3.08, 4.8(g) and 4.8(h) shall be subject to Section 3.10, the term “Project” as used in Section 3.08 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, and the term “commercially reasonable efforts” as used in Section 3.08 and Section 4.10(g) means efforts consistent with and subject to Section 3.10.
ARTICLE 5
TAXES
5.1 Allocation of Taxes and Charges. Seller shall pay or cause to be paid all Taxes on or with respect to the Facility or on or with respect to the sale and making available of Product to Buyer, that are imposed on Product prior to its delivery to Buyer at the time and place contemplated under this Agreement. Buyer shall pay or cause to be paid all Taxes on or with respect to the delivery to and purchase by Buyer of Product that are imposed on Product at and after its delivery to Buyer at the time and place contemplated under this Agreement (other than
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32 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.
5.2 Cooperation. Each Party shall use reasonable efforts to implement the provisions of and administer this Agreement in accordance with the intent of the Parties to minimize all Taxes, so long as no Party is materially adversely affected by such efforts. The Parties shall cooperate to minimize Tax exposure; provided, 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
6.1 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.
6.2 Maintenance of Health and Safety. Seller shall take reasonable safety precautions with respect to the operation, maintenance, repair and replacement of the Facility. If Seller becomes aware of any circumstances relating to the Facility that create an imminent risk of damage or injury to any Person or any Person’s property, Seller shall take prompt, reasonable action to prevent such damage or injury and shall give Buyer’s emergency contact identified in Exhibit N Notice of such condition. 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.
6.3 Shared Facilities. The Parties acknowledge and agree that certain of the Shared Facilities and Interconnection Facilities, and Seller’s rights and obligations under the Interconnection Agreement, may be subject to certain shared facilities and/or co-tenancy agreements to be entered into among Seller, the Transmission Provider, Seller’s Affiliates, and/or third parties pursuant to which certain Interconnection Facilities may be subject to joint ownership and shared maintenance and operation arrangements; provided, such agreements shall (i) permit Seller to perform or satisfy, and shall not purport to limit, its obligations hereunder, including maintaining Shared Facility capacity equal to the Interconnection Capacity Limit for Buyer’s sole use, (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 in the event of 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
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33 Shared Facilities. Seller shall not, and shall not permit any affiliate to, allocate to other parties a share of the total interconnection capacity under the Interconnection Agreements in excess of an amount equal to the total interconnection capacity under the Interconnection Agreements minus the Interconnection Capacity Limit.
ARTICLE 7
METERING
7.1 Metering Seller shall measure the amount of Facility Energy using the Facility Meter. Seller shall separately meter all Station Use. The Facility Meter shall be operated pursuant to applicable CAISO-approved calculation methodologies and maintained at Seller’s cost. If Seller elects to submit a SQMD Plan for the Facility, then the Facility Meter, will be programmed, operated and maintained pursuant to the applicable CAISO-approved SQMD Plan for the Facility, at Seller’s sole cost, throughout the period to which the SQMD Plan applies. Seller shall promptly provide to Buyer a copy of any CAISO-approved SQMD Plan and any modifications thereto and notice of any termination or withdrawal thereof. Subject to meeting any applicable CAISO requirements, the Facility Meter shall be programmed to adjust for all Electrical Losses and, if accepted by the CAISO for settlement purposes, for Distribution Provider’s Real Power Loss Factor from such meter to the Delivery Point in a manner subject to Buyer’s prior written approval, not to be unreasonably withheld. Metering shall be consistent with the Metering Diagram set forth as Exhibit R, as may be revised to be consistent with any CAISO-approved SQMD Plan. The Facility Meter shall be kept under seal, such seals to be broken only when the meter is to be tested, adjusted, modified or relocated. In the event Seller breaks a seal, Seller shall notify Buyer as soon as practicable. In addition, Seller hereby agrees to provide all meter data directly relating to the Facility to Buyer in a form reasonably acceptable to Buyer, and consents to Buyer obtaining from CAISO the CAISO meter data directly relating to the Facility and all inspection, testing and calibration data and reports, to the extent such meter data and related meters are not the subject of a CAISO-approved SQMD Plan for the Facility. Seller and Buyer, or Buyer’s Scheduling Coordinator, shall cooperate to allow both Parties to retrieve the meter reads from the CAISO Market Results Interface-Settlements (MRI-S) web and/or directly from the CAISO meter(s) at the Facility, to the extent such meter data and related meters are not the subject of a CAISO-approved SQMD Plan for the Facility.
7.2 Meter Verification. Annually, if Seller has reason to believe there may be a meter malfunction, or upon Buyer’s reasonable request, Seller shall test the meter. The tests shall be conducted by independent third parties qualified to conduct such tests. Buyer shall be notified seven (7) days in advance of such tests and have a right to be present during such tests. If a meter is inaccurate it shall be promptly repaired or replaced. If a meter is inaccurate by more than one percent (1%) and it is not known when the meter inaccuracy commenced (if such evidence exists, then such date will be used to adjust prior invoices), then the invoices covering the period of time since the last meter test shall be adjusted for the amount of the inaccuracy on the assumption that the inaccuracy persisted during one-half of such period so long as such adjustments are accepted by CAISO and WREGIS; provided, such period may not exceed twelve (12) months.
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34 ARTICLE 8
INVOICING AND PAYMENT; CREDIT
8.1 Invoicing. Seller shall use commercially reasonable efforts to deliver an invoice to Buyer for Product no later than the tenth (10th) day of each month for the previous calendar month.
Each invoice shall (a) 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 the amount of Facility Energy, and Replacement Product delivered to Buyer (if any), the calculation of Deemed Delivered Energy and Adjusted Energy Production, the LMP prices at the Delivery Point for each Settlement Period, and the Renewable Rate applicable to such Product in accordance with Exhibit C, and other relevant data for the prior month; and (b) be in a format reasonably specified by Buyer, covering the Product provided in the preceding month determined in accordance with the applicable provisions of this Agreement. Buyer shall, and shall cause its Scheduling Coordinator to, provide Seller 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 Seller to prepare and verify the accuracy of all invoices.
8.2 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 by the later of (a) ten (10) Business Days after Buyer’s receipt of the invoice from Seller, and (b) the thirtieth (30th) day of the month after the operational month for which such invoice was rendered; 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.
8.3 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 because the compensation under this Agreement exceeds $10,000.
8.4 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
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35 otherwise disputed 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.
8.5 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.
8.6 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 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.
8.7 Seller’s Development Security. To secure its obligations under this Agreement, Seller shall deliver the Development Security to Buyer within thirty (30) days after the Effective Date. Seller shall maintain the Development Security in full force and effect. Upon the earlier of (a) within ten (10) Business Days of 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.
8.8 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
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36 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). Following the occurrence of both events, Buyer shall promptly return to Seller the unused portion of the Performance Security.
8.9 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, Performance Security, 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 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 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.
ARTICLE 9
NOTICES
9.1 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.
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37 9.2 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.
ARTICLE 10
FORCE MAJEURE
10.1 Definition.
(a) “Force Majeure Event” means any act or event that delays or prevents a Party from timely performing all or a portion of its obligations under this Agreement or from complying with all or a portion of the conditions under this Agreement if such act or event, despite the exercise of 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; 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 Renewable 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; (v)
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38 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.
10.2 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.
10.3 Notice. In order to claim a Force Majeure Event, the claiming Party, within fourteen (14) days after the initial occurrence of the claimed 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.
10.4 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 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 two hundred seventy (270) days 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 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 Commercial Operation Delay Damages paid by Seller, less any amounts drawn in accordance with this Agreement.
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39 (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. 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
11.1 Events of Default. An “Event of Default” shall mean, (a) with respect to a Party (the “Defaulting Party”) that is subject to the Event of Default the occurrence of any of the following:
(i) the failure by such Party to make, when due, any payment required pursuant to this Agreement and such failure is not remedied within ten (10) Business Days after Notice thereof;
(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; and failures related to the Adjusted Energy Production that do not trigger the provisions of Section 11.1(b)(iii), the exclusive remedies for which are set forth in Section 4.7), 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; or (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 a party by operation of Law or pursuant to an agreement reasonably satisfactory to the other Party;
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40 (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 by the Facility, except for Replacement Product;
(ii) the failure by Seller to (A) achieve Construction Start on or before the Guaranteed Construction Start Date, as such date may be extended by Seller’s payment of Daily Delay Damages pursuant to Section 1(b) of Exhibit B and/or a Development Cure Period pursuant to Section 4 of Exhibit B, or (B) 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 pursuant to Section 2 of Exhibit B and/or a Development Cure Period pursuant to Section 4 of Exhibit B;
(iii) if, in any consecutive six (6) month period, 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 (“Cure Plan”) and (y) complete such Cure Plan in all material respects as set forth therein, including within the timeframe set forth therein;
(iv) failure by Seller to satisfy the collateral requirements pursuant to Sections 8.7 or 8.8 within five (5) Business Days after Notice from Buyer, including the 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; (v) 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, or (2) a Letter of Credit from a different issuer meeting the criteria set forth in the definition of Letter of Credit, in each case, in the amount required hereunder within ten (10) Business Days after Seller receives Notice of the occurrence of any of the following events:
(A) the issuer of the outstanding Letter of Credit shall fail to maintain a Credit Rating of at least 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;
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41 (D) the issuer of the outstanding Letter of Credit shall fail to honor a properly documented request to draw on such Letter of Credit; (E) the issuer of the outstanding Letter of Credit shall disaffirm, disclaim, repudiate or reject, in whole or in part, or challenge the validity of, such Letter of Credit; (F) such Letter of Credit fails or ceases to be in full force and effect at any time; or
(G) Seller shall fail to renew or cause the renewal of each outstanding Letter of Credit on a timely basis as provided in the relevant Letter of Credit and as provided in accordance with this Agreement, and in no event less than sixty (60) days prior to the expiration of the outstanding Letter of Credit.
11.2 Remedies; Declaration of Early Termination Date. If an Event of Default with respect to a Defaulting Party shall have occurred, 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.
11.3 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).
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42 (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 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 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) If Buyer is the Defaulting Party, then the Damage Payment shall be owed to Seller and shall equal 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.
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 this Section 11.3(a)(ii) 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 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
11.3(b) is a reasonable and appropriate approximation of such damages, and (iii) the Termination Payment described in this Section 11.3(b) is the exclusive remedy of the Non-Defaulting Party in connection with a Terminated Transaction but shall not otherwise act to limit any of the Non-Defaulting Party’s rights or remedies if the Non-Defaulting Party does not elect a Terminated Transaction as its remedy for an Event of Default by the Defaulting Party.
11.4 Notice of Payment of Termination Payment or Damage Payment. As soon as practicable after a Terminated Transaction, but in no event later than sixty (60) days after the Early Termination Date, Notice shall be given by the Non-Defaulting Party to the Defaulting Party of the amount of the Damage Payment or Termination Payment, as applicable, and whether the
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43 Termination Payment or Damage Payment, as applicable, is due to or from the Non-Defaulting Party. The Notice shall include a written statement explaining in reasonable detail the calculation of such amount and the sources for such calculation. The Termination Payment or Damage Payment, as applicable, shall be made to or from the Non-Defaulting Party, as applicable, within ten (10) Business Days after such Notice is effective.
11.5 Disputes With Respect to Termination Payment or Damage Payment. If the Defaulting Party disputes the Non-Defaulting Party’s calculation of the Termination Payment or Damage Payment, as applicable, in whole or in part, the Defaulting Party shall, within five (5) Business Days of receipt of the Non-Defaulting Party’s calculation of the Termination Payment or Damage Payment, as applicable, provide to the Non-Defaulting Party a detailed written explanation of the basis for such dispute. Disputes regarding the Termination Payment or Damage Payment, as applicable, shall be determined in accordance with Article 15.
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 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 the longer of (a) for a period of two (2) years following such early termination date, and (b) until the Guaranteed Construction Start 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.
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 11.6 apply, unless the transferee agrees to be bound by the terms set forth in this Section 11.6 pursuant to a written agreement approved by Buyer.
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 11.6.
11.7 Rights And Remedies Are Cumulative. Except where liquidated damages or other remedy are explicitly provided as the exclusive remedy, the rights and remedies of a Party pursuant to this Article 11 shall be cumulative and in addition to the rights of the Parties otherwise provided in this Agreement.
11.8 Mitigation. Any Non-Defaulting Party shall be obligated to use commercially reasonable efforts to mitigate its Costs, Losses and damages resulting from any Event of Default of the other Party under this Agreement.
ARTICLE 12
LIMITATION OF LIABILITY AND EXCLUSION OF WARRANTIES.
12.1 No Consequential Damages. EXCEPT TO THE EXTENT PART OF (A) AN
EXPRESS REMEDY OR MEASURE OF DAMAGES HEREIN, (B) AN IP INDEMNITY
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44 CLAIM, (C) AN ARTICLE 16 INDEMNITY CLAIM, (D) INCLUDED IN A LIQUIDATED DAMAGES CALCULATION, OR (E) RESULTING FROM A PARTY’S GROSS
NEGLIGENCE OR WILLFUL MISCONDUCT, NEITHER PARTY SHALL BE LIABLE TO
THE OTHER OR ITS INDEMNIFIED PERSONS FOR ANY SPECIAL, PUNITIVE,
EXEMPLARY, INDIRECT, OR CONSEQUENTIAL DAMAGES, OR LOSSES OR
DAMAGES FOR LOST REVENUE OR LOST PROFITS, WHETHER FORESEEABLE OR
NOT, ARISING OUT OF, OR IN CONNECTION WITH THIS AGREEMENT, BY STATUTE, IN TORT OR CONTRACT.
12.2 Waiver and Exclusion of Other Damages. EXCEPT AS EXPRESSLY SET
FORTH HEREIN, THERE IS NO WARRANTY OF MERCHANTABILITY OR FITNESS FOR
A PARTICULAR PURPOSE, AND ANY AND ALL IMPLIED WARRANTIES ARE DISCLAIMED. THE PARTIES CONFIRM THAT THE EXPRESS REMEDIES AND
MEASURES OF DAMAGES PROVIDED IN THIS AGREEMENT SATISFY THE ESSENTIAL PURPOSES HEREOF. ALL LIMITATIONS OF LIABILITY CONTAINED IN
THIS AGREEMENT, INCLUDING, WITHOUT LIMITATION, THOSE PERTAINING TO SELLER’S LIMITATION OF LIABILITY AND THE PARTIES’ WAIVER OF
CONSEQUENTIAL DAMAGES, SHALL APPLY EVEN IF THE REMEDIES FOR BREACH OF WARRANTY PROVIDED IN THIS AGREEMENT ARE DEEMED TO “FAIL OF THEIR ESSENTIAL PURPOSE” OR ARE OTHERWISE HELD TO BE INVALID OR UNENFORCEABLE.
FOR BREACH OF ANY PROVISION FOR WHICH AN EXPRESS AND EXCLUSIVE
REMEDY OR MEASURE OF DAMAGES IS PROVIDED, SUCH EXPRESS REMEDY OR
MEASURE OF DAMAGES SHALL BE THE SOLE AND EXCLUSIVE REMEDY, THE OBLIGOR’S LIABILITY SHALL BE LIMITED AS SET FORTH IN SUCH PROVISION, AND ALL OTHER REMEDIES OR DAMAGES AT LAW OR IN EQUITY ARE WAIVED.
IF NO REMEDY OR MEASURE OF DAMAGES IS EXPRESSLY PROVIDED HEREIN, THE OBLIGOR’S LIABILITY SHALL BE LIMITED TO DIRECT DAMAGES ONLY. THE
VALUE OF ANY TAX CREDITS, DETERMINED ON AN AFTER-TAX BASIS, LOST DUE TO BUYER’S DEFAULT (WHICH SELLER HAS NOT BEEN ABLE TO MITIGATE AFTER
USE OF REASONABLE EFFORTS) AND AMOUNTS DUE IN CONNECTION WITH THE
RECAPTURE OF ANY RENEWABLE ENERGY INCENTIVES, IF ANY, SHALL BE DEEMED TO BE DIRECT DAMAGES.
TO THE EXTENT ANY DAMAGES REQUIRED TO BE PAID HEREUNDER ARE LIQUIDATED, INCLUDING UNDER SECTIONS 4.7, 4.8, 11.2 AND 11.3, AND AS
PROVIDED IN EXHIBIT B, EXHIBIT C, EXHIBIT G, AND EXHIBIT P, THE PARTIES
ACKNOWLEDGE THAT THE DAMAGES ARE DIFFICULT OR IMPOSSIBLE TO
DETERMINE, THAT OTHERWISE OBTAINING AN ADEQUATE REMEDY IS
INCONVENIENT, AND THAT THE LIQUIDATED DAMAGES CONSTITUTE A REASONABLE APPROXIMATION OF THE ANTICIPATED HARM OR LOSS. IT IS THE
INTENT OF THE PARTIES THAT THE LIMITATIONS HEREIN IMPOSED ON REMEDIES
AND THE MEASURE OF DAMAGES BE WITHOUT REGARD TO THE CAUSE OR
CAUSES RELATED THERETO, INCLUDING THE NEGLIGENCE OF ANY PARTY,
WHETHER SUCH NEGLIGENCE BE SOLE, JOINT OR CONCURRENT, OR ACTIVE OR
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45 PASSIVE. THE PARTIES HEREBY WAIVE ANY RIGHT TO CONTEST SUCH PAYMENTS AS AN UNREASONABLE PENALTY.
THE PARTIES ACKNOWLEDGE AND AGREE THAT MONEY DAMAGES AND THE
EXPRESS REMEDIES PROVIDED FOR HEREIN ARE AN ADEQUATE REMEDY FOR THE
BREACH BY THE OTHER OF THE TERMS OF THIS AGREEMENT, AND EACH PARTY
WAIVES ANY RIGHT IT MAY HAVE TO SPECIFIC PERFORMANCE WITH RESPECT TO ANY OBLIGATION OF THE OTHER PARTY UNDER THIS AGREEMENT.
ARTICLE 13
REPRESENTATIONS AND WARRANTIES; AUTHORITY
13.1 Seller’s Representations and Warranties. As of the Effective Date, Seller represents and warrants as follows:
(a) Seller is a California limited liability company, duly organized, validly existing and in good standing under the laws of the jurisdiction of its formation, and is qualified to conduct business in each jurisdiction where the failure to so qualify would have a material adverse effect on the business or financial condition of Seller. (b) Seller has the power and authority to enter into and perform this Agreement and is not prohibited from entering into this Agreement or discharging and performing all covenants and obligations on its part to be performed under and pursuant to this Agreement, except where such failure does not have a material adverse effect on Seller’s performance under this Agreement. The execution, delivery and performance of this Agreement by Seller has been duly authorized by all necessary limited liability company action on the part of Seller and does not and will not require the consent of any trustee or holder of any indebtedness or other obligation of Seller or any other party to any other agreement with Seller. (c) The execution and delivery of this Agreement, consummation of the transactions contemplated herein, and fulfillment of and compliance by Seller with the provisions of this Agreement will not conflict with or constitute a breach of or a default under any Law presently in effect having applicability to Seller, subject to any permits that have not yet been obtained by Seller, the documents of formation of Seller or any outstanding trust indenture, deed of trust, mortgage, loan agreement or other evidence of indebtedness or any other agreement or instrument to which Seller is a party or by which any of its property is bound. (d) This Agreement has been duly executed and delivered by Seller. This Agreement is a legal, valid and binding obligation of Seller enforceable in accordance with its terms, except as limited by laws of general applicability limiting the enforcement of creditors’ rights or by the exercise of judicial discretion in accordance with general principles of equity. (e) The Facility (i) will be located in and connected electrically to a circuit, load, or substation within Southern California Edison’s service territory, and (ii) is located in or within five (5) miles of an eligible DAC.
(f) The Facility is located in the State of California.
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46 (g) Neither Seller nor its Affiliates have received notice from or been advised by any existing or potential supplier or service provider that COVID-19 has caused, or is reasonably likely to cause, a delay in the construction of the Facility or the delivery of materials necessary to complete the Facility, in each case that would cause the Construction Start Date to be later than the Guaranteed Construction Start Date or the Commercial Operation Date to be later than the Guaranteed Commercial Operation Date.
13.2 Buyer’s Representations and Warranties. As of the Effective Date, Buyer represents and warrants as follows:
(a) Buyer is a joint powers authority and a validly existing community choice aggregator, duly organized, validly existing and in good standing under the laws of the State of California and the rules, regulations and orders of the California Public Utilities Commission, and is qualified to conduct business in each jurisdiction of the Joint Powers Agreement members. All Persons making up the governing body of Buyer are the elected or appointed incumbents in their positions and hold their positions in good standing in accordance with the Joint Powers Agreement and other Law.
(b) Buyer has the power and authority to enter into and perform this Agreement and is not prohibited from entering into this Agreement or discharging and performing all covenants and obligations on its part to be performed under and pursuant to this Agreement, except where such failure does not have a material adverse effect on Buyer’s performance under this Agreement. The execution, delivery and performance of this Agreement by Buyer has been duly authorized by all necessary action on the part of Buyer and does not and will not require the consent of any trustee or holder of any indebtedness or other obligation of Buyer or any other party to any other agreement with Buyer.
(c) The execution and delivery of this Agreement, consummation of the transactions contemplated herein, and fulfillment of and compliance by Buyer with the provisions of this Agreement will not conflict with or constitute a breach of or a default under any Law presently in effect having applicability to Buyer, including but not limited to community choice aggregation, the Joint Powers Act, competitive bidding, public notice, open meetings, election, referendum, or prior appropriation requirements, the documents of formation of Buyer or any outstanding trust indenture, deed of trust, mortgage, loan agreement or other evidence of indebtedness or any other agreement or instrument to which Buyer is a party or by which any of its property is bound.
(d) This Agreement has been duly executed and delivered by Buyer. This Agreement is a legal, valid and binding obligation of Buyer enforceable in accordance with its terms, except as limited by laws of general applicability limiting the enforcement of creditors’ rights or by the exercise of judicial discretion in accordance with general principles of equity. (e) Buyer warrants and covenants that with respect to its contractual obligations under this Agreement, it will not claim immunity on the grounds of sovereignty or similar grounds with respect to itself or its revenues or assets from (1) suit, (2) jurisdiction of court, (3) relief by way of injunction, order for specific performance or recovery of property, (4) attachment of assets, or (5) execution or enforcement of any judgment.
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47 (f) Buyer is a “local public entity” as defined in Section 900.4 of the Government Code of the State of California.
(g) Buyer cannot assert sovereign immunity as a defense to the enforcement of its obligations under this Agreement.
13.3 General Covenants. Each Party covenants that commencing on the Effective Date and continuing throughout the Contract Term:
(a) It shall continue to be duly organized, validly existing and in good standing under the laws of the jurisdiction of its formation and to be qualified to conduct business in each jurisdiction where the failure to so qualify would have a material adverse effect on its business or financial condition;
(b) It shall maintain (or obtain from time to time as required) all regulatory authorizations necessary for it to legally perform its obligations under this Agreement; and (c) It shall perform its obligations under this Agreement in compliance with all terms and conditions in its governing documents and in material compliance with any Law.
13.4 Workforce Development. The Parties acknowledge that in connection with Buyer’s renewable energy procurement efforts, including entering into this Agreement, Buyer is committed to creating community benefits, which includes engaging a skilled and trained workforce and targeted hires. Accordingly, prior to the Guaranteed Construction Start Date, Seller shall ensure that work performed in connection with construction of the Facility will be conducted using a project labor agreement, community workforce agreement, work site agreement, collective bargaining agreement, or similar agreement providing for terms and conditions of employment with applicable labor organizations, and shall remain compliant with such agreement in accordance with the terms thereof. Seller shall provide documentation reasonably satisfactory to Buyer demonstrating Seller’s compliance with the requirements of this Section 13.4.
ARTICLE 14
ASSIGNMENT
14.1 General Prohibition on Assignments. Except as provided below in this Article 14, neither Party may voluntarily assign this Agreement or its rights or obligations under this Agreement, without the prior written consent of the other Party, which consent shall not be unreasonably withheld, conditioned or delayed. Any Change of Control of Seller (whether voluntary or by operation of law) will be deemed an assignment and will require the prior written consent of Buyer, which consent shall not be unreasonably withheld, conditioned or delayed; provided, a Change of Control of Seller shall not require Buyer’s consent if the assignee or transferee is a Permitted Transferee. Any assignment made without the required written consent, or in violation of the conditions to assignment set out below, shall be null and void. Seller shall be responsible for Buyer’s reasonable costs associated with the preparation, review, execution and delivery of documents in connection with any assignment of this Agreement by Seller, including without limitation reasonable attorneys’ fees.
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48 14.2 Collateral Assignment. Subject to the provisions of this Section 14.2, Seller has the right to assign this Agreement as collateral for any financing or refinancing of the Facility. In connection with any financing or refinancing of the Facility by Seller, Buyer shall in good faith work with Seller and Lender to execute a consent to collateral assignment of this Agreement substantially in the form attached hereto as Exhibit O (“Consent to Collateral Assignment”).
14.3 Permitted Assignment by Seller. Seller may, without the prior written consent of Buyer, transfer or assign this Agreement to: (a) an Affiliate of Seller or (b) any Person succeeding to all or substantially all of the assets of Seller (whether voluntary or by operation of law); if, and only if:
(a) the assignee is a Permitted Transferee;
(b) Seller has given Buyer Notice at least fifteen (15) Business Days before the date of such proposed assignment; and
(c) Seller has provided Buyer a written agreement signed by the Person to which Seller wishes to assign its interests that (x) provides that such Person will assume all of Seller’s obligations and liabilities under this Agreement upon such transfer or assignment and (y) certifies that such Person meets the definition of a Permitted Transferee.
Notwithstanding the foregoing, any assignment by Seller, its successors or assigns under this Section 14.3 shall be of no force and effect unless and until such Notice and agreement by the assignee have been received and accepted by Buyer.
14.4 Shared Facilities; Portfolio Financing. Buyer agrees and acknowledges that Seller may elect to finance all or any portion of the Facility or the Interconnection Facilities or the Shared Facilities (1) utilizing tax equity or cash equity investment, and/or (2) through a Portfolio Financing, which may include cross-collateralization or similar arrangements. In connection with any financing or refinancing of the Facility, the Interconnection Facilities or the Shared Facilities by Seller or any Portfolio Financing, Buyer, Seller, Portfolio Financing Entity (if any), and Lender shall execute and deliver such further consents, approvals and acknowledgments as may be reasonable and necessary to facilitate such transactions; provided, Buyer shall not be required to agree to any terms or conditions which are reasonably expected to have a material adverse effect on Buyer and all reasonable attorney’s fees incurred by Buyer in connection therewith shall be borne by Seller.
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, such Buyer Assignee has a Credit Rating equal to the higher of (a) Buyer’s Credit Rating at the time of such assignment (if applicable), and (b) Baa3 from Moody’s and BBB- from S&P. As reasonably requested by Buyer Assignee, Seller shall (i) provide Buyer Assignee with information and documentation with respect to Seller, including but not limited to account opening information, information related to
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49 forecasted generation, Credit Rating, and compliance with anti-money laundering rules, the Dodd-Frank Act, the Commodity Exchange Act, the Patriot Act and similar rules, regulations, requirements and corresponding policies; and (ii) 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 14.5.
ARTICLE 15
DISPUTE RESOLUTION
15.1 Governing Law. This Agreement and the rights and duties of the Parties hereunder shall be governed by and construed, enforced and performed in accordance with the laws of the state of California, without regard to principles of conflicts of Law. 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 Agreement. [STC – 17]
15.2 Dispute Resolution. In the event of any dispute arising under this Agreement, within ten (10) Business Days following the receipt of a Notice from either Party identifying such dispute, the Parties shall meet, negotiate and attempt, in good faith, to resolve the dispute quickly, informally and inexpensively. If the Parties are unable to resolve a dispute arising hereunder within the earlier of either forty-five (45) days of initiating such discussions, or within sixty (60) days after Notice of the dispute, either Party may seek any and all remedies available to it at law or in equity, subject to the limitations set forth in this Agreement.
15.3 Attorneys’ Fees. In any proceeding brought to enforce this Agreement or because of the breach by any Party of any covenant or condition herein contained, each Party shall bear its own respective costs, expenses and attorneys’ fees in connection with said action.
15.4 Venue. In the event of any legal action to enforce or interpret this Agreement, the sole and exclusive venue shall be a court of competent jurisdiction located in Los Angeles County, California, and the Parties hereto agree to and do hereby submit to the jurisdiction of such court, and waive any claim or defense that such forum is not convenient or proper.
ARTICLE 16
INDEMNIFICATION
16.1 Indemnification.
(a) Each Party (the “Indemnifying Party”) agrees to indemnify, defend and hold harmless the other Party and its Affiliates, directors, officers, employees and agents (collectively, the “Indemnified Party”) from and against all claims, demands, losses, liabilities, penalties, and expenses (including reasonable attorneys’ fees) (i) for personal injury or death to Persons and damage to the property of any third party to the extent arising out of, resulting from, or caused by the negligent or willful misconduct of the Indemnifying Party, its Affiliates, its directors, officers, employees, or agents, or (ii) for third-party claims resulting from the Indemnifying Party’s breach (including inaccuracy of any representation of warranty made hereunder), performance or non-performance of its obligations under this Agreement.
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50 (b) Seller shall indemnify, defend and hold harmless Buyer and its Affiliates, directors, officers, employees from and against all claims, demands, losses, liabilities, penalties, and expenses (including reasonable attorneys’ fees) in connection with any claims of infringement upon or violation of any trade secret, trademark, trade name, copyright, patent, or other intellectual property rights of any third party by equipment, software, applications or programs (or any portion of same) used in connection with the Facility (an “IP Indemnity Claim”). (c) Nothing in this Section 16.1 shall enlarge or relieve Seller or Buyer of any liability to the other for any breach of this Agreement. Neither Party shall be indemnified for its damages resulting from its sole negligence, intentional acts or willful misconduct. These indemnity provisions shall not be construed to relieve any insurer of its obligation to pay claims consistent with the provisions of a valid insurance policy.
16.2 Claims. Promptly after receipt by a Party of any claim or Notice of the commencement of any action, administrative, or legal proceeding, or investigation as to which the indemnity provided for in this Article 16 may apply, the Indemnified Party shall notify the Indemnifying Party in writing of such fact. The Indemnifying Party shall assume the defense thereof with counsel designated by the Indemnifying Party and satisfactory to the Indemnified Party, provided, if the defendants in any such action include both the Indemnified Party and the Indemnifying Party and the Indemnified Party shall have reasonably concluded that there may be legal defenses available to it which are different from or additional to, or inconsistent with, those available to the Indemnifying Party, the Indemnified Party shall have the right to select and be represented by separate counsel, at the Indemnifying Party’s expense, unless a liability insurer is willing to pay such costs. If the Indemnifying Party fails to assume the defense of a claim meriting indemnification, the Indemnified Party may at the expense of the Indemnifying Party contest, settle, or pay such claim; provided, settlement or full payment of any such claim may be made only following consent of the Indemnifying Party or, absent such consent, written opinion of the Indemnified Party’s counsel that such claim is meritorious or warrants settlement. Except as otherwise provided in this Article 16, in the event that a Party is obligated to indemnify and hold the other Party and its successors and assigns harmless under this Article 16, the amount owing to the Indemnified Party will be the amount of the Indemnified Party’s damages net of any insurance proceeds received by the Indemnified Party following a reasonable effort by the Indemnified Party to obtain such insurance proceeds.
INSURANCE
17.1 Insurance.
(a) General Liability. Seller shall provide and maintain, at its sole expense, the following types and minimum limits of insurance with a carrier rated “A- VII” or higher by A.M.
Best’s Key Rating Guide: (i) commercial general liability insurance, including products and completed operations and personal injury insurance, in a minimum amount of One Million Dollars ($1,000,000) per occurrence, and an annual aggregate of not less than Two Million Dollars ($2,000,000), endorsed to provide contractual liability in said amount, specifically covering Seller’s obligations under this Agreement and including Buyer as an additional insured; and (ii) an umbrella insurance policy in a minimum limit of liability of Two Million Dollars ($2,000,000).
Defense costs shall be provided as an additional benefit and not included within the limits of
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51 liability. Such insurance shall contain standard cross-liability and severability of interest provisions.
(b) Employer’s Liability Insurance. Employers’ Liability insurance shall not be less than One Million Dollars ($1,000,000.00) for injury or death occurring as a result of each accident. With regard to bodily injury by disease, the One Million Dollar ($1,000,000) policy limit will apply to each employee.
(c) Workers Compensation Insurance. Seller, if it has employees, shall also maintain at all times during the Contract Term workers’ compensation and employers’ liability insurance coverage in accordance with applicable requirements of Law. (d) Business Auto Insurance. Seller shall maintain at all times during the Contract Term business auto insurance for bodily injury and property damage with limits of One Million Dollars ($1,000,000) per occurrence. Such insurance shall cover liability arising out of Seller’s use of all owned (if any), non-owned and hired vehicles, including trailers or semi-trailers in the performance of the Agreement.
(e) Construction All-Risk Insurance. Seller or its subcontractor shall maintain or cause to be maintained during the construction of the Facility prior to the Commercial Operation Date, construction all-risk form property insurance covering the Facility during such construction periods, and naming Seller (and Lender if any) as the loss payee. (f) Property Damage Insurance. Seller shall maintain or cause to be maintained during the Delivery Term, property damage insurance with a policy limit of not less than the full replacement cost of the Facility on a per occurrence basis. (g) Subcontractor Insurance. Seller shall require all of its subcontractors to carry: (i) comprehensive general liability insurance with a combined single limit of coverage not less than One Million Dollars ($1,000,000); (ii) workers’ compensation insurance and employers’ liability coverage in accordance with applicable requirements of Law; and (iii) business auto insurance for bodily injury and property damage with limits of one million dollars ($1,000,000) per occurrence. All subcontractors shall name Seller as an additional insured to insurance carried pursuant to clauses (g)(i) and (g)(iii). All subcontractors shall provide a primary endorsement and a waiver of subrogation to Seller for the required coverage pursuant to this Section 17.1(g). (h) Evidence of Insurance. Within ten (10) days after execution of the Agreement and upon annual renewal thereafter, Seller shall deliver to Buyer certificates of insurance evidencing such coverage. Such certificates shall specify that Buyer shall be given at least thirty (30) days prior Notice by Seller in the event of any material modification, cancellation or termination of coverage. All insurance required herein shall be primary coverage without right of contribution from any insurance of Buyer, and such policies shall be endorsed with a waiver of subrogation in favor of Buyer for all work performed by Seller, its employees, agents and subcontractors and any subrogation rights which may pass to Seller’s insurance carriers for the payment of any claims. Any other insurance maintained by Seller is for the exclusive benefit of Seller and shall not in any manner inure to the benefit of Buyer.
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52 (i) Failure to Comply with Insurance Requirements. If Seller fails to comply with any of the provisions of this Article 17, Seller, among other things and without restricting Buyer’s remedies under the Law or otherwise, shall, at its own cost and expense, act as an insurer and provide insurance in accordance with the terms and conditions above. With respect to the required general liability, umbrella liability and commercial automobile liability insurance, Seller shall provide a current, full and complete defense to Buyer, its subsidiaries and Affiliates, and their respective officers, directors, shareholders, agents, employees, assigns, and successors in interest, in response to a third-party claim in the same manner that an insurer would have, had the insurance been maintained in accordance with the terms and conditions set forth above. In addition, alleged violations of the provisions of this Article 17 means that Seller has the initial burden of proof regarding any legal justification for refusing or withholding coverage and Seller shall face the same liability and damages as an insurer for wrongfully refusing or withholding coverage in accordance with the laws of California.
ARTICLE 18
CONFIDENTIAL INFORMATION
18.1 Definition of Confidential Information. The following constitutes “Confidential Information,” whether oral or written which is delivered by Seller to Buyer or by Buyer to Seller including: (a) the terms and conditions of, and proposals and negotiations related to, this Agreement, and (b) information that either Seller or Buyer stamps or otherwise identifies as “confidential” or “proprietary” before disclosing it to the other. Confidential Information does not include (i) information that was publicly available at the time of the disclosure, other than as a result of a disclosure in breach of this Agreement; (ii) information that becomes publicly available through no fault of the recipient after the time of the delivery; (iii) information that was rightfully in the possession of the recipient (without confidential or proprietary restriction) at the time of delivery or that becomes available to the recipient from a source not subject to any restriction against disclosing such information to the recipient; and (iv) information that the recipient independently developed without a violation of this Agreement.
18.2 Duty to Maintain Confidentiality. The Party receiving Confidential Information (the “Receiving Party”) from the other Party (the “Disclosing Party”) shall not disclose Confidential Information to a third party (other than the Party’s employees, lenders, counsel, accountants, directors or advisors, or any such representatives of a Party’s Affiliates, who have a need to know such information and have agreed to keep such terms confidential) except in order to comply with any applicable Law, regulation, or any exchange, control area or independent system operator rule or in connection with any court or regulatory proceeding applicable to such Party or any of its Affiliates; provided, each Party shall, to the extent practicable, use reasonable efforts to prevent or limit the disclosure. The Parties shall be entitled to all remedies available at law or in equity to enforce, or seek relief in connection with, this confidentiality obligation. The Parties agree and acknowledge that nothing in this Section 18.2 prohibits a Party from disclosing any one or more of the commercial terms of a transaction (other than the name of the other Party unless otherwise agreed to in writing by the Parties) to any industry price source for the purpose of aggregating and reporting such information in the form of a published energy price index.
The Parties acknowledge and agree that the Agreement and any transactions entered into in connection herewith are subject to the requirements of the California Public Records Act
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53 (Government Code Section 7920.000 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.
Upon request or demand of any third person or entity not a Party hereto to Buyer pursuant to the California Public Records Act for production, inspection and/or copying of Confidential Information (“Requested Confidential Information”), Buyer shall as soon as practical notify Seller in writing via email that such request has been made. Seller shall be solely responsible for taking at its sole expense whatever legal steps are necessary to prevent release of the Requested Confidential Information to the third party by Buyer. If Seller takes no such action after receiving the foregoing notice from Buyer, Buyer 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 Seller does take or attempt to take such action, Buyer shall provide timely and reasonable cooperation to Seller, if requested by Seller, and Seller agrees to indemnify and hold harmless Buyer, its officers, employees and agents (“Buyer’s Indemnified Parties”), from any claims, liability, award of attorneys’ fees, or damages, and to defend any action, claim or lawsuit brought against any of Buyer’s Indemnified Parties for Buyer’s refusal to disclose any Requested Confidential Information.
18.3 Irreparable Injury; Remedies. Receiving Party acknowledges that its obligations hereunder are necessary and reasonable in order to protect Disclosing Party and the business of Disclosing Party, and expressly acknowledges that monetary damages would be inadequate to compensate Disclosing Party for any breach or threatened breach by Receiving Party of any covenants and agreements set forth herein. Accordingly, Receiving Party acknowledges that any such breach or threatened breach will cause irreparable injury to Disclosing Party and that, in addition to any other remedies that may be available, in law, in equity or otherwise, Disclosing Party will be entitled to obtain injunctive relief against the threatened breach of this Agreement or the continuation of any such breach, without the necessity of proving actual damages.
18.4 Further Permitted Disclosure. Notwithstanding anything to the contrary in this Article 18, Confidential Information may be disclosed by the Receiving Party to any of its agents, consultants, contractors, trustees, or actual or potential financing parties (including, in the case of Seller, its Lender(s)), so long as such Person to whom Confidential Information is disclosed agrees in writing to be bound by confidentiality provisions that are at least as restrictive as this Article 18 to the same extent as if it were a Party.
18.5 Press Releases. Neither Party shall issue (or cause its Affiliates to issue) a press release regarding the transactions contemplated by this Agreement unless both Parties have agreed upon the contents of any such public statement.
ARTICLE 19
MISCELLANEOUS
19.1 Entire Agreement; Integration; Exhibits. This Agreement, together with the Cover Sheet and Exhibits attached hereto constitutes the entire agreement and understanding
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54 between Seller and Buyer with respect to the subject matter hereof and supersedes all prior agreements relating to the subject matter hereof, which are of no further force or effect. The Exhibits attached hereto are integral parts hereof and are made a part of this Agreement by reference. The headings used herein are for convenience and reference purposes only. In the event of a conflict between the provisions of this Agreement and those of the Cover Sheet or any Exhibit, the provisions of first the Cover Sheet, and then this Agreement shall prevail, and such Exhibit shall be corrected accordingly. This Agreement shall be considered for all purposes as prepared through the joint efforts of the Parties and shall not be construed against one Party or the other as a result of the preparation, substitution, submission or other event of negotiation, drafting or execution hereof.
19.2 Amendments. This Agreement may only be amended, modified or supplemented by an instrument in writing executed by duly authorized representatives of Seller and Buyer; provided, this Agreement may not be amended by electronic mail communications.
19.3 No Waiver. Waiver by a Party of any default by the other Party shall not be construed as a waiver of any other default.
19.4 No Agency, Partnership, Joint Venture or Lease. Seller and the agents and employees of Seller shall, in the performance of this Agreement, act in an independent capacity and not as officers or employees or agents of Buyer. Under this Agreement, Seller and Buyer intend to act as energy seller and energy purchaser, respectively, and do not intend to be treated as, and shall not act as, partners in, co-venturers in or lessor/lessee with respect to the Facility or any business related to the Facility. This Agreement shall not impart any rights enforceable by any third party (other than a permitted successor or assignee bound to this Agreement) and/or, to the extent set forth herein, any Lender and/or Indemnified Party.
19.5 Severability. In the event that any provision of this Agreement is unenforceable or held to be unenforceable, the Parties agree that all other provisions of this Agreement have force and effect and shall not be affected thereby. The Parties shall, however, use their best endeavors to agree on the replacement of the void, illegal or unenforceable provision(s) with legally acceptable clauses which correspond as closely as possible to the sense and purpose of the affected provision and this Agreement as a whole.
19.6 Mobile-Sierra. Notwithstanding any other provision of this Agreement, neither Party shall seek, nor shall they support any third party seeking, to prospectively or retroactively revise the rates, terms or conditions of service of this Agreement through application or complaint to FERC pursuant to the provisions of Section 205, 206 or 306 of the Federal Power Act, or any other provisions of the Federal Power Act, absent prior written agreement of the Parties. Further, absent the prior written agreement in writing by both Parties, the standard of review for changes to the rates, terms or conditions of service of this Agreement proposed by a Party shall be the “public interest” standard of review set forth in United Gas Pipe Line Co. v. Mobile Gas Service Corp., 350 U.S. 332 (1956) and Federal Power Commission v. Sierra Pacific Power Co., 350 U.S. 348 (1956). Changes proposed by a non-Party or FERC acting sua sponte shall be subject to the most stringent standard permissible under applicable Law.
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55 19.7 Counterparts. This Agreement may be executed in one or more counterparts, all of which taken together shall constitute one and the same instrument and each of which shall be deemed an original.
19.8 Electronic Delivery. This Agreement may be duly executed and delivered by a Party by electronic format (including portable document format (.pdf)) delivery of the signature page of a counterpart to the other Party.
19.9 Binding Effect. This Agreement shall inure to the benefit of and be binding upon the Parties and their respective successors and permitted assigns.
19.10 No Recourse to Members of Buyer. Buyer is organized as a Joint Powers Authority in accordance with the Joint Exercise of Powers Act of the State of California (Government Code Section 6500, et seq.) pursuant to its Joint Powers Agreement and is a public entity separate from its constituent members. Buyer shall solely be responsible for all debts, obligations and liabilities accruing and arising out of this Agreement. Seller shall have no rights and shall not make any claims, take any actions or assert any remedies against any of Buyer’s constituent members, or the employees, directors, officers, consultants or advisors of Buyer or its constituent members, in connection with this Agreement.
19.11 Forward Contract. The Parties acknowledge and agree that this Agreement constitutes a “forward contract” within the meaning of the U.S. Bankruptcy Code, and Buyer and Seller are “forward contract merchants” within the meaning of the U.S. Bankruptcy Code. Each Party further agrees that, for all purposes of this Agreement, each Party waives and agrees not to assert the applicability of the provisions of 11 U.S.C. § 366 in any Bankruptcy proceeding wherein such Party is a debtor. In any such proceeding, each Party further waives the right to assert that the other Party is a provider of last resort to the extent such term relates to 11 U.S.C. §366 or another provision of 11 U.S.C. § 101-1532.
19.12 Change in Electric Market Design. If a change in the CAISO Tariff renders this Agreement or any provisions hereof incapable of being performed or administered, then any Party may request that Buyer and Seller enter into negotiations to make the minimum changes to this Agreement necessary to make this Agreement capable of being performed and administered, while attempting to preserve to the maximum extent possible the benefits, burdens, and obligations set forth in this Agreement as of the Effective Date. Upon delivery of such a request, Buyer and Seller shall engage in such negotiations in good faith. If Buyer and Seller are unable, within sixty (60) days after delivery of such request, to agree upon changes to this Agreement or to resolve issues relating to changes to this Agreement, then any Party may submit issues pertaining to changes to this Agreement to the dispute resolution process set forth in Article 15. Notwithstanding the foregoing, (i) a change in cost shall not in and of itself be deemed to render this Agreement or any of the provisions hereof incapable of being performed or administered, and (ii) all of the unaffected provisions of this Agreement shall remain in full force and effect during any period of such negotiation or dispute resolution.
19.13 Further Assurances. Each of the Parties hereto agrees to provide such information, execute and deliver any instruments and documents and to take such other actions as may be necessary or reasonably requested by the other Party which are not inconsistent with the provisions
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56 of this Agreement and which do not involve the assumptions of obligations other than those provided for in this Agreement, to give full effect to this Agreement and to carry out the intent of this Agreement.
19.14 Service Contract. The Seller represents and warrants this PPA to be a “service contract” within the meaning of Section 7701(e)(3) of the Internal Revenue Code of 1986 and given this representation and warranty, Buyer agrees that it will not take the position on any tax return or in any other filings suggesting that it is anything other than a purchase of electricity from the Facility.
[Signatures on following page]
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IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed as of the Effective Date.
SATICOY SUN FARMS, LLC, a California
limited liability company.
By:
Name:
Title:
CLEAN POWER ALLIANCE OF SOUTHERN
CALIFORNIA, a California joint powers authority
By:
Name:
Title:
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Exhibit A – 1
EXHIBIT A
FACILITY DESCRIPTION
Site Name: Saticoy Solar
Site includes all or some of the following APNs: 0860020775 City: Ventura
County: Ventura
Zip Code: 93004
Latitude and Longitude: 34°17'34"N 119°10'16"W
Facility Description:
Delivery Point: Distribution Provider’s Vineyard 16 kV distribution line out of Saticoy 66/16 kV Substation
P-node: [To Be Determined]
Transmission Provider: SCE
Distribution Provider: SCE
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Exhibit B - 1
EXHIBIT B
FACILITY CONSTRUCTION AND COMMERCIAL OPERATION
1. Construction of the Facility.
(a) “Construction Start” will occur upon Seller’s acquisition of all applicable regulatory authorizations, approvals and permits for the construction of the Facility, and once Seller has engaged all contractors and ordered all essential equipment and supplies as, in each case, can reasonably be considered necessary so that physical construction of the Facility may begin and proceed to completion without foreseeable interruption of material duration, and has executed an engineering, procurement, and construction contract and issued thereunder a final notice to proceed that authorizes the contractor to mobilize to Site and begin physical construction (including, at a minimum, excavation for foundations or the installation or erection of improvements) at the Site. The date of Construction Start will be evidenced by and subject to Seller’s delivery to Buyer of a certificate substantially in the form attached as Exhibit J hereto, and the date certified therein shall be the “Construction Start Date.” Seller shall cause Construction Start to occur no later than the Guaranteed Construction Start Date. (b) Seller may extend the Guaranteed Construction Start Date by paying Daily Delay Damages to Buyer for each day Seller desires to extend the Guaranteed Construction Start Date, not to exceed a total of one hundred twenty (120) days of extensions by such payment of Daily Delay Damages. On or before the date that is ten (10) days prior to the then-current Guaranteed Construction Start Date, Seller shall provide notice and payment to Buyer of the Daily Delay Damages for the number of days of extension to the Guaranteed Construction Start Date. If Seller achieves Construction Start prior to the Guaranteed Construction Start Date, as extended by the payment of Daily Delay Damages, Buyer shall refund to Seller the Daily Delay Damages for each day Seller achieves Construction Start prior to the Guaranteed Construction Start Date times the Daily Delay Damages, not to exceed the total amount of Daily Delay Damages paid by Seller pursuant to this Section 1(b). Additionally, if Seller achieves Commercial Operation on or before the Guaranteed Commercial Operation Date (not including any extensions to such date resulting from Seller’s payment of Commercial Operation Delay Damages, but as may be extended pursuant to a Development Cure Period), then Buyer shall refund to Seller all Daily Delay Damages paid by Seller and not previously refunded by Buyer.
2. Commercial Operation of the Facility. “Commercial Operation” means the condition existing when Seller has fulfilled all of the conditions precedent in Section 2.2 of the Agreement and provided Notice to Buyer substantially in the form of Exhibit H (the “COD Certificate”).
(a) Seller shall cause Commercial Operation for the Facility to occur by the Guaranteed Commercial Operation Date. Seller shall notify Buyer that it intends to achieve
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Exhibit B - 2
Commercial Operation at least sixty (60) days before the anticipated Commercial Operation Date.
(b) Seller may extend the Guaranteed Commercial Operation Date by paying Commercial Operation Delay Damages to Buyer for each day Seller desires to extend the Guaranteed Commercial Operation Date, not to exceed a total of ninety (90) days of extensions by such payment of Commercial Operation Delay Damages. On or before the date that is ten (10) days prior to the then-current Guaranteed Commercial Operation Date, Seller shall provide Notice and payment to Buyer of the Commercial Operation Delay Damages for the number of days of extension to the Guaranteed Commercial Operation Date. If Seller achieves Commercial Operation prior to the Guaranteed Commercial Operation Date as extended by the payment of Commercial Operation Delay Damages, Buyer shall refund to Seller the Commercial Operation Delay Damages for each day Seller achieves Commercial Operation prior to the Guaranteed Commercial Operation Date times the Commercial Operation Delay Damages, not to exceed the total amount of Commercial Operation Delay Damages paid by Seller pursuant to this Section 2(b).
3. Termination for Failure to Achieve Commercial Operation. If the Facility has not achieved Commercial Operation on or before the Guaranteed Commercial Operation Date (as may be extended hereunder), Buyer may elect to terminate this Agreement in accordance with Sections 11.1(b)(ii) and 11.2.
4. Extension of the Guaranteed Dates. The Guaranteed Construction Start Date and the Guaranteed Commercial Operation Date shall, subject to notice and documentation requirements set forth below, be extended on a day-for-day basis (the “Development Cure Period”) for the duration of any and all delays arising out of the following circumstances to the extent (i) the following circumstances are not the result of Seller’s failure to take all commercially reasonable actions to meet its requirements and deadlines, (ii) such delays could not be mitigated by Seller using commercially reasonable efforts to overcome the delays, and (iii) such delays do not run concurrently:
(a) Seller has not acquired the Material Permits by the Guaranteed Construction Start Date, despite the exercise of diligent and commercially reasonable efforts by Seller; or
(b) a Force Majeure Event occurs; or
(c) the Interconnection Facilities or Reliability Network Upgrades are not complete and ready for the Facility to connect and sell Product at the Delivery Point by the Guaranteed Commercial Operation Date, despite the exercise of diligent and commercially reasonable efforts by Seller; or
(d) Buyer has not made all necessary arrangements to receive the Facility Energy at the Delivery Point by the Guaranteed Commercial Operation Date.
Seller shall submit any claim for Development Cure Period delays within ten (10) Business
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Exhibit B - 3
Days of the applicable milestone in the case of (a), (c) or (d) above, and (y) fourteen (14) days after the initial occurrence of the claimed Force Majeure Event in the case of (b) above, in substantially the form set forth in Exhibit T. Notwithstanding anything in this Agreement to the contrary, the cumulative extensions granted under the Development Cure Period (other than the extensions granted pursuant to clause 4(d) above) shall not exceed one hundred eighty (180) days, for any reason, including a Force Majeure Event, and the cumulative extensions granted to the Guaranteed Commercial Operation Date by the payment of Commercial Operation Delay Damages and any Development Cure Period(s) (other than the extensions granted pursuant to clause 4(d) above) shall not exceed two hundred seventy (270) days. Upon request from Buyer, Seller shall provide documentation demonstrating to Buyer’s reasonable satisfaction that the delays described above did not result from Seller’s actions or failure to take commercially reasonable actions.
5. Failure to Reach Guaranteed Capacity. If, at Commercial Operation, the Installed Capacity is less than one hundred percent (100%) of the Guaranteed Capacity, Seller shall have ninety (90) days after the Commercial Operation Date to install additional capacity and/or Network Upgrades such that the Installed Capacity is equal to (but not greater than) the Guaranteed Capacity, and Seller shall provide to Buyer a new certificate substantially in the form attached as Exhibit H hereto specifying the new Installed Capacity. If Seller fails to construct the Guaranteed Capacity by such date, Seller shall pay “Capacity Damages” to Buyer, in an amount equal to Three Hundred Fifty Thousand Dollars ($350,000) for each MW that the Guaranteed Capacity exceeds the Installed Capacity, and the Guaranteed Capacity and other applicable portions including Expected Energy of the Agreement shall be adjusted accordingly. Capacity Damages shall not be offset or reduced by the payment of Development Security, Performance Security, Delay Damages, or any other form of liquidated damages under this Agreement.
6. Buyer’s Right to Draw on Development Security. If Seller fails to timely pay any Daily Delay Damages or Commercial Operation Delay Damages, Buyer may draw upon the Development Security to satisfy Seller’s payment obligation thereof.
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Exhibit C - 1
EXHIBIT C
COMPENSATION
Buyer shall compensate Seller for the Product in accordance with this Exhibit C. (a) Renewable Rate. Buyer shall pay Seller the Renewable Rate for each MWh of Facility Energy, plus Deemed Delivered Energy, if any, up to one hundred fifteen percent (115%) of the Expected Energy for such Contract Year.
(b) Excess Contract Year Deliveries Over 115%. Notwithstanding the foregoing, if at any point in any Contract Year, the amount of Facility Energy plus Deemed Delivered Energy exceeds one hundred fifteen percent (115%) of the Expected Energy for such Contract Year, the price to be paid for additional Facility Energy and/or Deemed Delivered Energy shall be $0.00/MWh.
(c) Excess Settlement Interval Deliveries. If during any Settlement Interval, Seller delivers Facility Energy in excess of the product of the Guaranteed Capacity, the Real Power Loss Factor Multiplier, and the duration of the Settlement Interval, expressed in hours (“Excess MWh”), then the price applicable to all such Excess MWh in such Settlement Interval shall be zero dollars ($0), and if there is a Negative LMP during such Settlement Interval, Seller shall pay to Buyer an amount equal to the absolute value of the Negative LMP times such Excess MWh. (d) Test Energy. Test Energy is compensated in accordance with Section 3.6. (e) Tax Credits. Except as described in the Renewable Rate definition, the Parties agree that the Renewable Rate is not subject to adjustment or amendment if Seller fails to receive any Tax Credits, or if any Tax Credits expire, are repealed or otherwise cease to apply to Seller or the Facility in whole or in part, or Seller or its investors are unable to benefit from any Tax Credits.
Seller shall bear all risks, financial and otherwise, throughout the Contract Term, associated with Seller’s or the Facility’s eligibility to receive Tax Credits or to qualify for accelerated depreciation for Seller’s accounting, reporting or Tax purposes. The obligations of the Parties hereunder, including those obligations set forth herein regarding the purchase and price for and Seller’s obligation to deliver Facility Energy and Product, shall be effective regardless of whether construction of the Facility (or any portion thereof) or the sale of Facility Energy is eligible for, or receives Tax Credits during the Contract Term.
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Exhibit E - 1
EXHIBIT D
SCHEDULING COORDINATOR RESPONSIBILITIES
(a) Buyer as Scheduling Coordinator for the Facility. Upon Initial Synchronization of the Facility to the CAISO Grid, Buyer shall be the Scheduling Coordinator or designate a qualified third party to provide Scheduling Coordinator services with the CAISO for the Facility for both the delivery and the receipt of Test Energy and the Product at the Delivery Point. At least thirty (30) days prior to the Initial Synchronization of the Facility to the CAISO Grid, (i) Seller shall take all actions and execute and deliver to Buyer and the CAISO all documents necessary to authorize or designate Buyer (or Buyer’s designee) as the Scheduling Coordinator for the Facility effective as of the Initial Synchronization of the Facility to the CAISO Grid, and (ii) Buyer shall, and shall cause its designee to, take all actions and execute and deliver to Seller and the CAISO all documents necessary to authorize or designate Buyer or its designee as the Scheduling Coordinator for the Facility effective as of the Initial Synchronization of the Facility to the CAISO Grid. On and after Initial Synchronization of the Facility to the CAISO Grid, Seller shall not authorize or designate any other party to act as the Facility’s Scheduling Coordinator, nor shall Seller perform for its own benefit the duties of Scheduling Coordinator, and Seller shall not revoke Buyer’s authorization to act as the Facility’s Scheduling Coordinator unless agreed to by Buyer. Buyer (as the Facility’s SC) shall submit bids to the CAISO in accordance with this Agreement and the applicable CAISO Tariff, protocols and Scheduling practices for Product on a day-ahead, hour-ahead, fifteen-minute market, real-time or other market basis that may develop after the Effective Date, as determined by Buyer.
(b) Notices. Buyer (as the Facility’s SC) shall provide Seller with access to a web-based system through which Seller shall submit to Buyer and the CAISO all notices and updates required under the CAISO Tariff regarding the Facility’s status, including, but not limited to, all outage requests, forced outages, forced outage reports, clearance requests, or must offer waiver forms. Seller shall cooperate with Buyer to provide such notices and updates. If the web-based system is not available, Seller shall promptly submit such information to Buyer and the CAISO by (in order of preference) telephonically or electronic mail to the personnel designated to receive such information.
(c) CAISO Costs and Revenues. Except as otherwise set forth below, Buyer (as Scheduling Coordinator for the Facility) shall be responsible for CAISO costs (including penalties, Imbalance Energy costs or revenues, and other charges) and shall be entitled to all CAISO revenues (including credits, Imbalance Energy revenues or costs, and other payments), including revenues associated with CAISO dispatches, bid cost recovery, Inter-SC Trade credits, or other credits in respect of the Product Scheduled or delivered from the Facility. Seller shall be responsible for all CAISO costs and penalties (including Imbalance Energy costs) and Buyer’s lost opportunity to obtain a share of CAISO’s allocation to non-violating Scheduling Coordinators of the penalties and/or sanctions collected from sanctioned or penalized market participants (not including Availability Incentive Payments or Non-Availability Charges (as such terms are defined in the CAISO Tariff)) resulting from any failure by Seller to abide by the CAISO Tariff, the terms of this Agreement or the outage notification requirements set forth in this Agreement (except to the extent such non-compliance is caused by Buyer’s failure to perform its duties as Scheduling Coordinator for the Facility). Buyer or its designated SC shall make commercially reasonable efforts to
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Exhibit D - 2
cooperate with Seller to allow Seller to make Resource Adequacy substitutions with respect to such outages as permitted by the CAISO Tariff. The Parties agree that any Availability Incentive Payments (as defined in the CAISO Tariff) are for the benefit of Seller and for Seller’s account and that any Non-Availability Charges (as defined in the CAISO Tariff) are the responsibility of Seller and for Seller’s account. In addition, if during the Delivery Term, the CAISO implements or has implemented any sanction or penalty related to scheduling, outage reporting, or generator operation, and any such sanctions or penalties are imposed upon the Facility or to Buyer as Scheduling Coordinator due to failure by Seller to abide by the CAISO Tariff or the outage notification requirements set forth in this Agreement, the cost of the sanctions or penalties shall be Seller’s responsibility.
(d) CAISO Settlements. Buyer (as the Facility’s SC) shall be responsible for all settlement functions with the CAISO related to the Facility. Buyer shall render a separate invoice to Seller for any CAISO payments, charges or penalties (“CAISO Charges Invoice”) for which Seller is responsible under this Agreement. CAISO Charges Invoices shall be rendered after settlement information becomes available from the CAISO that identifies any CAISO charges.
Notwithstanding the foregoing, Seller acknowledges that the CAISO will issue additional invoices reflecting CAISO adjustments to such CAISO charges. Buyer shall review, validate, and if requested by Seller under paragraph (e) below, dispute any charges that are the responsibility of Seller in a timely manner and consistent with Buyer’s existing settlement processes for charges that are Buyer’s responsibilities. Subject to Seller’s right to dispute and to have Buyer pursue the dispute of any such invoices, Seller shall pay the amount of CAISO Charges Invoices within ten (10) Business Days of Seller’s receipt of the CAISO Charges Invoice. If Seller fails to pay such CAISO Charges Invoice within that period, Buyer may net or offset any amounts owing to it for such CAISO Charges Invoices against any future amounts it may owe to Seller under this Agreement. The obligations under this Section with respect to payment of CAISO Charges Invoices shall survive the expiration or termination of this Agreement. (e) Dispute Costs. Buyer (as the Facility’s SC) may be required by Seller to dispute CAISO settlements in respect of the Facility. Seller agrees to pay Buyer’s costs and expenses (including reasonable attorneys’ fees) associated with its involvement with such CAISO disputes to the extent they relate to CAISO charges payable by Seller with respect to the Facility that Seller has directed Buyer to dispute.
(f) Terminating Buyer’s Designation as Scheduling Coordinator. At least thirty (30) days prior to expiration of this Agreement or as soon as reasonably practicable upon an earlier termination of this Agreement, the Parties will take all actions necessary to terminate the designation of Buyer as Scheduling Coordinator for the Facility as of 11:59 p.m. on such expiration date.
(g) Master Data File and Resource Data Template. The Parties will cooperate to comply with the applicable deadlines for filing and updating the information for the Facility in the Master Resource Database and Master Data File. Seller shall provide the data to the CAISO (and to Buyer) that is required for the CAISO’s Master Data File and Resource Data Template (or successor data systems) for the Facility consistent with this Agreement at least five (5) Business Days before the deadline for submission to CAISO and Buyer (as SC) shall promptly provide such data to CAISO. Seller shall provide the data that is required for the CPUC’s Master Resource
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Exhibit D - 3
Database for the Facility consistent with this Agreement to Buyer for review and approval at least five (5) Business Days before the deadline for submission of such to the CPUC. Neither Party shall change such data without the other Party’s prior written consent. At least once per Contract Year, Seller shall cooperate with Buyer to review and confirm that the data provided for the CAISO’s Master Data File and Resource Data Template (or successor data systems) and CPUC’s Master Resource Database for this Facility remains consistent with the actual operating characteristics of the Facility and provide such information and any additional supporting documentation to Buyer for review at least five (5) Business Days prior to submission to the CAISO or CPUC as applicable. (h) NERC Reliability Standards. Buyer (as Scheduling Coordinator) shall cooperate reasonably with Seller to the extent necessary to enable Seller to comply, and for Seller to demonstrate Seller’s compliance with, NERC reliability standards. This cooperation shall include the provision of information in Buyer’s possession that Buyer (as Scheduling Coordinator) has provided to the CAISO related to the Facility or actions taken by Buyer (as Scheduling Coordinator) related to Seller’s compliance with NERC reliability standards.
Agenda Page 211
Exhibit E - 1
EXHIBIT E
PROGRESS REPORTING FORM
Each Progress Report must include the following items:
1. Executive Summary.
2. Facility description.
3. Site plan of the Facility.
4. Description of any material planned changes to the Facility or the Site.
5. Gantt chart schedule showing progress on achieving each of the Milestones.
6. Summary of activities during the previous calendar quarter or month, as applicable, including any OSHA labor hour reports.
7. Forecast of activities scheduled for the current calendar quarter or month, as applicable.
8. Written description about the progress relative to Seller’s Milestones, including whether Seller has met or is on target to meet the Milestones.
9. List of issues that are reasonably likely to affect Seller’s Milestones.
10. A status report of start-up activities including a forecast of activities ongoing and after start-up, a report on Facility performance including performance projections for the next twelve (12) months.
11. Progress and schedule of all material agreements, contracts, permits (including Material Permits), approvals, technical studies, financing agreements and major equipment purchase orders showing the start dates, completion dates, and completion percentages.
12. Pictures, in sufficient quantity and of appropriate detail, in order to document construction and startup progress of the Facility, the interconnection into the Transmission System and all other interconnection utility services
13. Workforce Development or Supplier Diversity Reporting (if applicable). Format to be provided by Buyer and Seller to use commercially reasonable efforts to complete.
14. Any other documentation reasonably requested by Buyer.
Agenda Page 212
Exhibit F-1
EXHIBIT F-1
MONTHLY EXPECTED AVAILABLE FACILITY CAPACITY
[MW Per Hour] – [Insert Month]
1:00 2:00 3:00 4:00 5:00 6:00 7:00 8:00 9:00 10:00 11:00 12:00 13:00 14:00 15:00 16:00 17:00 18:00 19:00 20:00 21:00 22:00 23:00 24:00 JAN
FEB
MAR
APR
MAY
JUN
JUL
AUG
SEP
OCT
NOV
DEC
The foregoing table is provided for informational purposes only, and it shall not constitute, or be deemed to constitute, an obligation of any of the Parties to this Agreement.
Agenda Page 213
Exhibit F-2
EXHIBIT F-2
MONTHLY EXPECTED FACILITY ENERGY
[MWh Per Hour] – [Insert Month]
1:00 2:00 3:00 4:00 5:00 6:00 7:00 8:00 9:00 10:00 11:00 12:00 13:00 14:00 15:00 16:00 17:00 18:00 19:00 20:00 21:00 22:00 23:00 24:00 JAN
FEB
MAR
APR
MAY
JUN
JUL
AUG
SEP
OCT
NOV
DEC
The foregoing table is provided for informational purposes only, and it shall not constitute, or be deemed to constitute, an obligation of any of the Parties to this Agreement.
Agenda Page 214
Exhibit G - 1
EXHIBIT G
GUARANTEED ENERGY PRODUCTION DAMAGES CALCULATION
In accordance with Section 4.7, if Seller fails to achieve the Guaranteed Energy Production during any Performance Measurement Period, a liquidated damages payment shall be due from Seller to Buyer, calculated as follows:
[(A – B) * (C – D)] – (E + F)
where:
A = the Guaranteed Energy Production amount for the Performance Measurement Period, in MWh
B = the Adjusted Energy Production amount for the Performance Measurement Period, in MWh
C = Replacement price for the Performance Measurement Period, in $/MWh, which is the sum of (a) the simple average of the Integrated Forward Market hourly price for all the hours in the Performance Measurement Period, as published by the CAISO, for the Existing Zone Generation Trading Hub (as defined in the CAISO Tariff) for the Delivery Point, plus (b) the market value of Replacement Green Attributes
D = the Renewable Rate, in $/MWh
E = The amount of Energy Replacement Damages paid by Seller with respect to the immediately preceding Performance Measurement Period F = The product of (a) the amount of Replacement Product in MWhs delivered by Seller in the immediately preceding Contract Year and (b) the price which is (C – D)
“Adjusted Energy Production” shall mean the sum of the following: Facility Energy + Deemed Delivered Energy + Lost Output + Replacement Product. “Replacement Energy” means energy produced by a facility other than the Facility, that is provided by Seller to Buyer as Replacement Product, in an amount equal to the amount of Replacement Green Attributes provided by Seller as Replacement Product for the same Performance Measurement Period.
“Replacement Green Attributes” means Renewable Energy Credits of the same Portfolio Content Category (i.e., PCC1) as the Green Attributes portion of the Product and of the same year of production as the Renewable Energy Credits that would have been generated by the Facility.
Agenda Page 215
Exhibit G - 2
“Replacement Product” means (a) Replacement Energy, and (b) Replacement Green Attributes in an amount not to exceed ten percent (10%) of the Expected Energy for the previous Contract Year.
No payment shall be due if the calculation of (a) (A - B), (b) (C - D), or (c) [(A – B) * (C – D)] – (E + F), yields a negative number. In no event will Buyer owe any payment to Seller pursuant to this Exhibit G.
Within sixty (60) days after each Contract Year, Buyer shall send Seller Notice of the amount of damages owing, if any, which shall be payable to Buyer before the later of (a) thirty (30) days of such Notice and (b) ninety (90) days after each Performance Measurement Period; provided, the amount of damages owing shall be adjusted to account for Replacement Product, if any, delivered after each applicable Performance Measurement Period.
Agenda Page 216
Exhibit H - 1
EXHIBIT H
FORM OF COMMERCIAL OPERATION DATE CERTIFICATE
This certification (“Certification”) of Commercial Operation is delivered by _______[licensed professional engineer] (“Engineer”) to Clean Power Alliance of Southern California, a California joint powers authority (“Buyer”) in accordance with the terms of that certain Renewable Power Purchase Agreement dated _______ (“Agreement”) by and between Saticoy Sun Farms, LLC and Buyer. All capitalized terms used in this Certification but not otherwise defined herein shall have the respective meanings assigned to such terms in the Agreement.
As of _______[DATE]_____, Engineer hereby certifies and represents to Buyer the following:
1. The Facility is fully operational, reliable and interconnected, fully integrated and synchronized with the Transmission System.
2. The installed nameplate capacity of the Facility is __ MW AC (“Installed Capacity”).
3. The Installed Capacity is not less than ninety-five percent (95%) of the Guaranteed Capacity.
4. Authorization to parallel the Facility was obtained by the Transmission Provider, [Name of Transmission Provider as appropriate] on___[DATE]____.
5. The Transmission Provider has provided documentation supporting full unrestricted release of the Facility for Commercial Operation by [Name of Transmission Provider as appropriate] on _______[DATE]_____.
6. The CAISO has provided notification supporting Commercial Operation of the Facility, in accordance with the CAISO Tariff on _______[DATE]_____.
7. Seller has segregated and separately metered Station Use to the extent reasonably possible in accordance with Prudent Operating Practice, and any such meter(s) have the same or greater level of accuracy as is required for CAISO certified meters used for settlement purposes.
EXECUTED by [LICENSED PROFESSIONAL ENGINEER]
this ________ day of _____________, 20__.
[LICENSED PROFESSIONAL ENGINEER]
By:
Its:
Date:
Agenda Page 217
Exhibit I-1
EXHIBIT I
[Intentionally Omitted]
Agenda Page 218
Exhibit J - 1
EXHIBIT J
FORM OF CONSTRUCTION START DATE CERTIFICATE
This certification of Construction Start Date (“Certification”) is delivered by Saticoy Sun Farms, LLC (“Seller”) to Clean Power Alliance of Southern California, a California joint powers authority (“Buyer”) in accordance with the terms of that certain Renewable Power Purchase Agreement dated __________ (“Agreement”) by and between Seller and Buyer. All capitalized terms used in this Certification but not otherwise defined herein shall have the respective meanings assigned to such terms in the Agreement.
Seller hereby certifies and represents to Buyer the following:
(1) Construction Start (as defined in Exhibit B of the Agreement) has occurred, and a copy of the notice to proceed that Seller issued to its contractor as part of Construction Start is attached hereto.
(2) the Construction Start Date occurred on _____________ (the “Construction Start Date”); and
(3) the precise Site on which the Facility is located is, which must be within the boundaries of the previously identified Site:
_____________________________________________________________________ (such description shall amend the description of the Site in Exhibit A of the Agreement).
IN WITNESS WHEREOF, the undersigned has executed this Certification on behalf of Seller as of the ___ day of ________.
[SELLER ENTITY]
By:
Its:
Date:
Agenda Page 219
Exhibit K - 1
EXHIBIT K
FORM OF LETTER OF CREDIT
[Issuing Bank Letterhead and Address]
IRREVOCABLE STANDBY LETTER OF CREDIT NO. [XXXXXXX]
Date:
Bank Ref.:
Amount: US$[XXXXXXXX]
Beneficiary:
Clean Power Alliance of Southern California,
a California joint powers authority
801 S Grand, Suite 400
Los Angeles, CA 90017
Ladies and Gentlemen:
By the order of __________ (“Applicant”), we, [insert bank name and address] (“Issuer”) hereby issue our Irrevocable Standby Letter of Credit No. [XXXXXXX] (the “Letter of Credit”) in favor of Clean Power Alliance of Southern California, a California joint powers authority (“Beneficiary”), 801 S Grand, Suite 400, Los Angeles, CA 90017, for an amount not to exceed the aggregate sum of U.S. $[XXXXXX] (United States Dollars [XXXXX] and 00/100) (the “Available Amount”), pursuant to that certain Renewable Power Purchase Agreement dated as of ______ and as amended (the “Agreement”) between Applicant and Beneficiary. This Letter of Credit shall become effective immediately and shall be of no further force or effect at 5:00 p.m., California time, on [Date] or, if such day is not a Business Day (as hereinafter defined), on the next Business Day (as may be extended pursuant to the terms of this Letter of Credit, the “Expiration Date”).
For the purposes hereof, “Business Day” shall mean any day on which commercial banks are not authorized or required to close in Los Angeles, California.
Funds under this Letter of Credit are available to Beneficiary by valid presentation on or before 5:00 p.m. California time, on or before the Expiration Date of a copy of this Letter of Credit No. [XXXXXXX] and all amendments accompanied by Beneficiary’s dated statement purportedly signed by Beneficiary’s duly authorized representative, in the form attached hereto as Exhibit A, containing one of the two alternative paragraphs set forth in paragraph 2 therein.
Any full or partial drawing hereunder may be requested by (a) physical delivery or (b) transmitting copies of the requisite documents as described above to the Issuer by as a PDF attachment to an e-mail to [XXXXX] or such other email address as specified from time-to-time by the Issuer. The email transmittal shall be deemed delivered when received. Drawings made by email transmittal
Agenda Page 220
Exhibit K - 2
are deemed to be the operative instrument without the need of originally signed documents. In addition to the Drawing Certificate, email presentations must include Beneficiary’s contact name and telephone number for Issuer verification of such drawing request. In addition, if the presentation is made by email, Beneficiary is requested to confirm Issuer’s receipt of the drawing request under the Letter of Credit by calling Issuer at [XXXXX], provided that such requirement is not applicable if Issuer is not reachable at this number, or such contact number has been changed and Beneficiary has not been provided with notice of same in writing by Issuer in accordance with the Letter of Credit
Issuer hereby agrees that all drafts drawn under and in compliance with the terms of this Letter of Credit will be duly honored if presented to the Issuer before the Expiration Date. All correspondence and any drawings (other than those made by facsimile) hereunder are to be directed to [Issuer address/contact]. Issuer undertakes to make payment to Beneficiary under this Standby Letter of Credit within three (3) business days of receipt by Issuer of a properly presented Drawing Certificate. The Beneficiary shall receive payment from Issuer by wire transfer to the bank account of the Beneficiary designated in the Drawing Certificate.
Partial draws are permitted under this Letter of Credit, and this Letter of Credit shall remain in full force and effect with respect to any continuing balance; provided, the Available Amount shall be reduced by the amount of each such drawing.
It is a condition of this Letter of Credit that it shall be deemed automatically extended without an amendment for a one year period (or, if such period ends on a day that is not a Business Day, until the next Business Day thereafter) beginning on the present Expiration Date hereof and upon each anniversary for such date (or, if such period ends on a day that is not a Business Day, until the next Business Day thereafter), unless at least one hundred twenty (120) days prior to any such Expiration Date Issuer has sent Beneficiary written notice by overnight courier service at the address provided below that Issuer elects not to extend this Letter of Credit, in which case it will expire on its then-current Expiration Date. No presentation made under this Letter of Credit after such Expiration Date will be honored.
Notwithstanding any reference in this Letter of Credit to any other documents, instruments or agreements, this Letter of Credit contains the entire agreement between Beneficiary and Issuer relating to the obligations of Issuer hereunder.
Except so far as otherwise stated, this Letter of Credit is subject to the International Standby Practices ISP98 (also known as ICC Publication No. 590), or revision currently in effect (the “ISP”). As to matters not covered by the ISP, the laws of the State of California, without regard to the principles of conflicts of laws thereunder, shall govern all matters with respect to this Letter of Credit.
Please address all correspondence regarding this Letter of Credit to the attention of the Letter of Credit Department at [insert bank address information], referring specifically to Issuer’s Letter of Credit No. [XXXXXXX]. For telephone assistance, please contact Issuer’s Standby Letter of Credit Department at [XXX-XXX-XXXX] and have this Letter of Credit available.
Agenda Page 221
Exhibit K - 3
All notices to Beneficiary shall be in writing and are required to be sent by certified letter, overnight courier, or delivered in person to: Clean Power Alliance of Southern California, a California joint powers authority, Chief Financial Officer, 801 S Grand, Suite 400, Los Angeles, CA 90017. Only notices to Beneficiary meeting the requirements of this paragraph shall be considered valid. Any notice to Beneficiary which is not in accordance with this paragraph shall be void and of no force or effect.
[Bank Name]
___________________________
[Insert officer name]
[Insert officer title]
Agenda Page 222
Exhibit K - 4
EXHIBIT A
(DRAW REQUEST SHOULD BE ON BENEFICIARY’S LETTERHEAD)
Drawing Certificate
[Insert Bank Name and Address]
Ladies and Gentlemen:
The undersigned, a duly authorized representative of [ ], [ADDRESS], as beneficiary (the “Beneficiary”) of the Irrevocable Letter of Credit No. [XXXXXXX] (the “Letter of Credit”) issued by [insert bank name] (the “Bank”) by order of __________ (the “Applicant”), hereby certifies to the Bank as follows:
1. Applicant and Beneficiary are party to that certain Renewable Power Purchase Agreement dated as of ___________, 20__ (the “Agreement”).
2. Beneficiary is making a drawing under this Letter of Credit in the amount of U.S. $___________ because a Seller Event of Default (as such term is defined in the Agreement) has occurred.
or
Beneficiary is making a drawing under this Letter of Credit in the amount of U.S. $___________, which equals the full available amount under the Letter of Credit, because Applicant is required to maintain the Letter of Credit in force and effect beyond the expiration date of the Letter of Credit but has failed to provide Beneficiary with a replacement Letter of Credit or other acceptable instrument within thirty (30) days prior to such expiration date.
3. The undersigned is a duly authorized representative of [ ] and is authorized to execute and deliver this Drawing Certificate on behalf of Beneficiary.
You are hereby directed to make payment of the requested amount to [ ] by wire transfer in immediately available funds to the following account:
[Specify account information]
[ ]
_______________________________
Name and Title of Authorized Representative
Date___________________________
Agenda Page 223
Exhibit L - 1
EXHIBIT L
FORM OF LIMITED ASSIGNMENT AGREEMENT
Agenda Page 224
Exhibit L - 2
FORM OF ASSIGNMENT SCHEDULE
[SELLER ENTITY]
Assigned Product: Energy and Green Attributes (PCC1)
Assigned Delivery Point: [__]
Assigned Prepay Quantity: As set forth in Appendix 2; provided that (i) all Assigned Products shall be delivered pursuant to the Limited Assignment Agreement during the Assignment Period as provided in Appendix 1 and (ii) the Assigned Prepay Quantity is defined for the convenience of PPA Buyer and [Financing Party] and shall have no impact on the obligations of the Parties under the Limited Assignment Agreement.
APC Contract Price: $[__]/MWh with respect to Energy and Green Attributes.
Assignment Period: [__]
Agenda Page 225
Exhibit L - 3
ANNEX I– FORM OF LIMITED ASSIGNMENT AGREEMENT
This Limited Assignment Agreement (this “Assignment Agreement” or “Agreement”) is entered into as of [______________] by and among Saticoy Sun Farms, LLC, a California limited liability company (“PPA Seller”), Clean Power Alliance, a California joint powers authority (“PPA Buyer”), and [Financing Party], a [______________] (“Financing Party”), and relates to that certain power purchase agreement (the “PPA”) between PPA Buyer and PPA Seller as defined in Appendix 1 hereto. Unless the context otherwise specifies or requires, capitalized terms used but not defined in this Agreement have the meanings set forth in the PPA.
In consideration of the premises above and the mutual covenants and agreements herein set forth, PPA Seller, PPA Buyer and Financing Party (the “Parties” hereto; each is a “Party”) agree as follows:
1. Limited Assignment and Delegation.
(a) PPA Buyer hereby assigns, transfers, and conveys to Financing Party all right, title and interest in and to the rights of PPA Buyer under the PPA to receive delivery of, or have made available to it, the products described in Appendix 1 (collectively, the “Assigned Product”) during the Assignment Period (as defined in Appendix 1), as such rights may be limited or further described in the “Further Information” section on Appendix 1 (the “Assigned Product Rights”). All Assigned Product shall be delivered pursuant to the terms and conditions of this Agreement during the Assignment Period as provided in Appendix 1. All other rights of PPA Buyer under the PPA are expressly reserved for PPA Buyer.
(b) 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 1(d) hereof). To the extent that either (i) Financing Party does not make the payments into the Custodial Account (as defined on Appendix I) or (ii) the Custodian does not make the payments to the PPA Seller from the Custodial Account as described herein, PPA Buyer agrees that it shall remain responsible for any payment obligations under the PPA and that it will be an Event of Default pursuant to Section 11.1 of the PPA if PPA Buyer does not make such payment by the times and on the terms set forth in the PPA.
(c) Financing Party hereby accepts and PPA Seller hereby consents and agrees to the assignment, transfer, conveyance, and delegation described in clauses (a) and (b) above. (d) All scheduling of Assigned Product and other communications related to the PPA shall take place pursuant to the terms of the PPA; provided that during the Assignment Period (i) title to Assigned Product will pass from PPA Seller to Financing Party upon delivery or making available by PPA Seller of Assigned Product in accordance with the PPA;
Agenda Page 226
Exhibit L - 4
(ii) PPA Buyer will provide copies to Financing Party of any Notice of a Force Majeure Event or Event of Default or default, breach or other occurrence that, if not cured within the applicable grace period, could result in an Event of Default contemporaneously upon delivery thereof to PPA Seller and promptly after receipt thereof from PPA Seller; (iii) PPA Seller will provide copies to Financing Party of annual forecasts of Energy and monthly forecasts of available capacity and Energy provided pursuant to Section
4.3 of the PPA; (iv) PPA Seller will provide copies to Financing Party of all invoices and supporting data provided to PPA Buyer pursuant to Section 8.1, provided that any payment adjustments or subsequent reconciliations occurring after the date that is 10 days prior to the payment due date for a monthly invoice, including pursuant to Section
8.4, will be resolved solely between PPA Buyer and PPA Seller and therefore PPA Seller will not be obligated to deliver copies of any communications relating thereto to Financing Party; and (v) PPA Buyer and PPA Seller, as applicable, will provide copies to Financing Party of any other information reasonably requested by Financing Party relating to Assigned Product.
(e) PPA Seller acknowledges that (i) Financing Party intends to immediately transfer title to any Assigned Product received from PPA Seller through one or more intermediaries such that all Assigned Product will be re-delivered to PPA Buyer; and (ii) in the event that PPA Buyer fails to pay the relevant intermediary entity for any such Assigned Products, the receivables owed by PPA Buyer for such Assigned Products (“PPA Buyer Receivables”) may be transferred to Financing Party. To the extent any such PPA Buyer Receivables are transferred to Financing Party, Financing Party may transfer such PPA Buyer Receivables to PPA Seller and apply the face amount thereof as a reduction to any Delivered Product Payment Obligation. Thereafter, PPA Seller shall be entitled to pursue collection on such PPA Buyer Receivables directly against PPA Buyer. (f) On or before the commencement of the Assignment Period, [_____] (“Guarantor”) will issue, in favor of PPA Seller, a guaranty of Financing Party’s payment obligations under this Assignment Agreement substantially in the form of Appendix 3 attached hereto (“Guaranty”). PPA Seller may draw upon, apply, or make demand under the Guaranty to recover any unpaid amounts due from Financing Party and not timely paid as set forth herein; provided, however, that PPA Seller’s rights under the Guaranty and this subsection (f) shall not reduce or affect PPA Buyer’s obligation to render payments when due under the PPA or extend any deadlines in the PPA. (g) All payments due to PPA Seller in respect of Sections 3.3 of the PPA will be paid (subject to Section 1(e) above) by Financing Party into the custodial account listed in Appendix 1, and all payments due to PPA Buyer in respect of Section 3.3 of the PPA will be paid by PPA Seller into the custodial account listed in Appendix 1, which custodial account is established under that certain Custodial Agreement of even date herewith that Financing Party, PPA Buyer and [Custodian] have entered into for the administration of payments due hereunder.
(h) The Assigned Prepay Quantity set forth in Appendix 2 relates to obligations by and between Financing Party and PPA Buyer and has no impact on PPA Seller’s rights and obligations under the PPA.
(i) Except as expressly set forth in Section 1(a) of this Assignment Agreement with respect to the product delivery obligations, nothing in this Agreement modifies or amends any rights or obligations of PPA Buyer and PPA Seller under the PPA.
Agenda Page 227
Exhibit L - 5
2. Assignment Early Termination.
(a) The Assignment Period may be terminated early upon the occurrence of any of the following:
(1) delivery of a written notice of termination specifying a termination date by either Financing Party or PPA Buyer to each of the other Parties; (2) delivery of a written notice of termination specifying a termination date by PPA Seller to each of Financing Party and PPA Buyer following Financing Party’s failure to pay when due any amounts owed to PPA Seller in respect of any Delivered Product Payment Obligation and such payment is not made by Financing Party within five (5) business days following receipt by Financing Party and PPA Buyer of written notice;
(3) delivery of a written notice by PPA Seller if any of the events described in the definition of Bankrupt in the PPA occurs with respect to Financing Party; (4) delivery of a written notice by Financing Party if any of the events described in the definition of Bankrupt in the PPA occurs with respect to PPA Seller; or (5) failure of the Guaranty provided by the Guarantor to PPA Seller hereunder to be in full force and effect (other than in accordance with its terms) prior to the indefeasible satisfaction of all obligations of Financing Party hereunder or if the Guarantor provides notice of termination of the Guaranty or otherwise repudiates, disaffirms, disclaims, or rejects, in whole or in part, or challenges the validity of the Guaranty.
(b) The Assignment Period will end at the end of last delivery hour on the date specified in the termination notice provided pursuant to Section 2(a), which date shall not be earlier than the end of the last day of the calendar month in which such notice is delivered if termination is pursuant to clause (a)(1) or (a)(2) above. All Assigned Rights and Obligations shall revert from Financing Party to PPA Buyer upon the expiration or early termination of the Assignment Period, provided that (i) Financing Party shall remain responsible for the Delivered Product Payment Obligation with respect to any Assigned Product delivered or made available to Financing Party prior to the end of the Assignment Period, and (ii) any legal restrictions on the effectiveness of such reversion (whether arising under bankruptcy law or otherwise) shall not affect the expiration or early termination of the Assignment Period.
(c) The Assignment Period will automatically terminate upon the expiration or early termination of the PPA. All Assigned Rights and Obligations shall revert from Financing Party to PPA Buyer upon the expiration of or early termination of the PPA, provided that (i) Financing Party shall remain responsible for the Delivered Product Payment Obligation with respect to any Assigned Product delivered to Financing Party prior to the end of the Assignment Period, and (ii) any legal restrictions on the effectiveness of such reversion (whether arising under bankruptcy law or otherwise) shall not affect the expiration or early termination of the Assignment Period.
3. Representations and Warranties. The PPA Seller and the PPA Buyer represent and warrant to Financing Party that (a) the PPA is in full force and effect; and (b) no event or
Agenda Page 228
Exhibit L - 6
circumstance exists (or would exist with the passage of time or the giving of notice) that would give either of them the right to terminate the PPA or suspend performance thereunder.
4. Notices. Any notice, demand, or request required or authorized by this Assignment Agreement to be given by one Party to another Party shall be delivered in accordance with Article 9 of the PPA and to the addresses of each of PPA Seller and PPA Buyer specified in the PPA. PPA Buyer agrees to notify Financing Party of any updates to such notice information, including any updates provided by PPA Seller to PPA Buyer. Notices to Financing Party shall be provided to the following address, as such address may be updated by Financing Party from time to time by notice to the other Parties:
Financing Party
_____________
_____________
Email: _____________
5. Miscellaneous. Section 13.2 (Buyer’s Representations and Warranties), Article 18 (Confidential Information), Sections 19.5 (Severability), 19.7 (Counterparts), 19.2 (Amendments), 19.4 (No Agency, Partnership, Joint Venture or Lease), 19.6 (Mobile-Sierra),
19.8 (Electronic Delivery), 19.9 (Binding Effect) and 19.10 (No Recourse to Members of Buyer) of the PPA are incorporated by reference into this Agreement, mutatis mutandis, as if fully set forth herein.
6. U.S. Resolution Stay Provisions. The Parties hereby confirm that they are adherents to the ISDA 2018 U.S. Resolution Stay Protocol (“ISDA U.S. Stay Protocol”), the terms of the ISDA U.S. Stay Protocol are incorporated into and form a part of this Agreement, and for the purposes of such incorporation, (i) Financing Party shall be deemed to be a Regulated Entity, (ii) each of PPA Buyer and PPA Seller shall be deemed to be an Adhering Party, and (iii) this Agreement shall be deemed a Protocol Covered Agreement. In the event of any inconsistencies between this Agreement and the ISDA U.S. Stay Protocol, the ISDA U.S. Stay Protocol will prevail.
7. Governing Law, Jurisdiction, Waiver of Jury Trial.
(a) Governing Law. This Assignment Agreement and the rights and duties of the parties under this Assignment Agreement will be governed by and construed, enforced and performed in accordance with the laws of the State of California, without reference to any conflicts of law provisions that would direct the application of another jurisdiction’s laws; provided, however, that the authority of PPA Buyer to enter into and perform its obligations under this Assignment Agreement shall be determined in accordance with the laws of the State of California.
(b) Jurisdiction. Each party submits to the exclusive jurisdiction of the federal courts of the United States of America for the Southern District of California sitting in the city and county of Los Angeles.
(c) Waiver of Right to Trial by Jury. Each party waives, to the fullest extent permitted by applicable law, any right it may have to a trial by jury in respect of any suit, action or proceeding relating to this assignment agreement.
[Remainder of Page Intentionally Blank]
Agenda Page 229
Exhibit L - 7
IN WITNESS WHEREOF, the Parties have executed this Assignment Agreement effective as of the date first set forth above.
SATICOY SUN FARMS, LLC
By:
Name:
Title:
CLEAN POWER ALLIANCE
By:
Name:
Title:
[FINANCING PARTY]
By:
Name:
Title:
Execution and delivery of the foregoing Assignment Agreement is hereby approved.
CALIFORNIA COMMUNITY CHOICE FINANCING AUTHORITY
By:
Name:
Title:
Agenda Page 230
Exhibit L - 8
Appendix 1
Assigned Rights and Obligations
PPA: “PPA” means that certain Renewable Power Purchase Agreement dated [____], by and between Clean Power Alliance and Ventura Sun Farms, a California limited liability company, as amended from time to time.
“Assignment Period” means the period beginning on [___________] and extending until [___________], provided that in no event shall the Assignment Period extend past the earlier of (i) the termination of the Assignment Period pursuant to Section 2 of the Assignment Agreement and (ii) the end of the Delivery Term under the PPA; provided that applicable provisions of this Agreement shall continue in effect after termination of the Assignment Period to the extent necessary to enforce or complete, duties, obligations or responsibilities of the Parties arising prior to the termination.
Assigned Product: “Assigned Product” includes (i) Energy and (ii) Green Attributes (including PCC1 RECs).
Further Information: PPA Seller shall continue to transfer the WREGIS Certificates associated with all Renewable Energy Credits corresponding to all Metered Energy under the PPA pursuant to Section 4.7 of the PPA, provided that the transferee of such WREGIS Certificates may be changed from time to time in accordance with the written instructions of both Financing Party and Clean Power Alliance upon twenty (20) Business Days’ notice, which change shall be effective as of the first day of the next calendar month, unless otherwise agreed. All Assigned Product delivered by PPA Seller to Financing Party shall be a sale made at wholesale, with Financing Party reselling all such Assigned Product.
Agenda Page 231
9 Appendix 2
Assigned Prepay Quantity
[NOTE: To be set forth in a monthly volume schedule.]
Agenda Page 232
Exhibit L – Appendix 1 – 1
Appendix 3
Form of Financing Party Parent Guaranty
Agenda Page 233
Exhibit M – 1
EXHIBIT M
[Intentionally Omitted]
Agenda Page 234
Exhibit N – 1
EXHIBIT N
NOTICES
SATICOY SUN FARMS, LLC, a California
limited liability company (“Seller”)
CLEAN POWER ALLIANCE OF SOUTHERN
CALIFORNIA, a California joint powers
authority (“Buyer”)
All Notices:
Street: 925 De La Vina St, Ste 104
City: Santa Barbara, CA 93101
Attn: Chief Executive Officer
Phone: 805-901-2913
Email:[email protected]
All Notices:
Street: 801 S Grand, Suite 400
City: Los Angeles, CA 90017
Attn: Chief Executive Officer
Phone: (213) 269-5870
E-mail: [email protected]
Reference Numbers:
Duns:
Federal Tax ID Number:
Reference Numbers:
Duns:
Federal Tax ID Number:
Invoices:
Attn: Settlements
Phone:(781) 752-5200
E-mail:[email protected]
Invoices:
Attn: CPA Settlements
Phone: (213) 269-5870
E-mail: [email protected]
Scheduling:
Attn: Scheduling
Phone:(781) 752-5200
Email:[email protected]
Scheduling:
Attn: Day Ahead Scheduling
Phone: (817) 303-1104
Email: [email protected]
Confirmations:
Attn:
Phone:
Email:
Confirmations:
Attn:
Phone:
Email:
Payments:
Attn: Vice President
Phone:(781) 752-5200
E-mail: [email protected]
Payments:
Attn: Vice President, Power Supply
E-mail: [email protected]
Wire Transfer:
BNK: River City Bank
ABA: 121133416
ACCT: XXXXXX0800
Wire Transfer:
BNK: River City Bank
ABA: 121133416
ACCT: XXXXXX8042
Agenda Page 235
Exhibit O – 1
EXHIBIT O
FORM OF CONSENT TO COLLATERAL ASSIGNMENT
This Consent to Collateral Assignment (this “Consent”) is entered into among (i) Clean Power Alliance of Southern California, a California joint powers authority (“CPA”), (ii) [Name of Seller], a [Legal Status of Seller] (the “Project Company”), and (iii) [Name of Collateral Agent], a [Legal Status of Collateral Agent], as Collateral Agent for the secured parties under the Financing Documents referred to below (such secured parties together with their successors permitted under this Consent in such capacity, the “Secured Parties”, and, such agent, together with its successors in such capacity, the “Collateral Agent”). CPA, Project Company and Collateral Agent are hereinafter sometimes referred to individually as a “Party” and jointly as the “Parties”.
Capitalized terms used but not otherwise defined in this Consent shall have the meanings ascribed to them in the PPA (as defined below).
RECITALS
The Parties enter into this Consent with reference to the following facts:
A. Project Company and CPA have entered into that certain Renewable Power Purchase Agreement, dated as of [Date] [List all amendments as contemplated by Section 3.4] (“PPA”), pursuant to which Project Company will develop, construct, commission, test and operate the Facility and sell the Product to CPA, and CPA will purchase the Product from Project Company;
B. As collateral for Project Company’s obligations under the PPA, Project Company has agreed to provide to CPA certain collateral, which may include Performance Security and Development Security and other collateral described in the PPA (collectively, the “PPA Collateral”);
C. Project Company has entered into that certain [Insert description of financing arrangements with Lender], dated as of [Date], among Project Company, the Lenders party thereto and the Collateral Agent (the “Financing Agreement”), pursuant to which, among other things, the Lenders have extended commitments to make loans to Project Company; D. As collateral security for Project Company’s obligations under the Financing Agreement and related agreements (collectively, the “Financing Documents”), Project Company has, among other things, assigned all of its right, title and interest in, to and under the PPA and Project’s Company’s owners have pledged their ownership interest in Project Company (collectively, the “Assigned Interest”) to the Collateral Agent pursuant to the Financing Documents; and
E. It is a requirement under the Financing Agreement and the PPA that CPA and the other Parties hereto shall have executed and delivered this Consent.
AGREEMENT
In consideration of the foregoing, and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, and intending to be legally bound, the Parties hereto hereby agree as follows:
Agenda Page 236
Exhibit O - 2
SECTION 1. CONSENT TO ASSIGNMENT, ETC.
1.1 Consent and Agreement.
CPA hereby acknowledges:
(a) Notice of and consents to the assignment as collateral security to Collateral Agent, for the benefit of the Secured Parties, of the Assigned Interest; and (b) The right (but not the obligation) of Collateral Agent in the exercise of its rights and remedies under the Financing Documents, to make all demands, give all notices, take all actions and exercise all rights of Project Company permitted under the PPA (subject to CPA’s rights and defenses under the PPA and the terms of this Consent) and accepts any such exercise; provided, insofar as the Collateral Agent exercises any such rights under the PPA or makes any claims with respect to payments or other obligations under the PPA, the terms and conditions of the PPA applicable to such exercise of rights or claims shall apply to Collateral Agent to the same extent as to Project Company.
1.2 Project Company’s Acknowledgement.
Each of Project Company and Collateral Agent hereby acknowledges and agrees that CPA is authorized to act in accordance with Collateral Agent’s instructions, and that CPA shall bear no liability to Project Company or Collateral Agent in connection therewith, including any liability for failing to act in accordance with Project Company’s instructions.
1.3 Right to Cure.
If Project Company defaults in the performance of any of its obligations under the PPA, or upon the occurrence or non-occurrence of any event or condition under the PPA which would immediately or with the passage of any applicable grace period or the giving of notice, or both, enable CPA to terminate or suspend its performance under the PPA (a “PPA Default”), CPA will not terminate or suspend its performance under the PPA until it first gives written notice of such PPA Default to Collateral Agent and affords Collateral Agent the right to cure such PPA Default within the applicable cure period under the PPA, which cure period shall run concurrently with that afforded Project Company under the PPA. In addition, if Collateral Agent gives CPA written notice prior to the expiration of the applicable cure period under the PPA of Collateral Agent’s intention to cure such PPA Default (which notice shall include a reasonable description of the time during which it anticipates to cure such PPA Default) and is diligently proceeding to cure such PPA Default, notwithstanding the applicable cure period under the PPA, Collateral Agent shall have a period of sixty (60) days (or, if such PPA Default is for failure by the Project Company to pay an amount to CPA which is due and payable under the PPA other than to provide PPA Collateral, thirty (30) days, or, if such PPA Default is for failure by Project Company to provide PPA Collateral, ten (10) Business Days) from the Collateral Agent’s receipt of the notice of such PPA Default from CPA to cure such PPA Default; provided, (a) if possession of the Facility is necessary to cure any such non-monetary PPA Default and Collateral Agent has commenced foreclosure proceedings within sixty (60) days after notice of the PPA Default and is diligently pursuing such foreclosure proceedings, Collateral Agent will be allowed a reasonable time, not to exceed one hundred eighty (180) days after the notice of the PPA Default, to complete such
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Exhibit O - 3
proceedings and cure such PPA Default, and (b) if Collateral Agent is prohibited from curing any such PPA Default by any process, stay or injunction issued by any Governmental Authority or pursuant to any bankruptcy or insolvency proceeding or other similar proceeding involving Project Company, then the time periods specified herein for curing a PPA Default shall be extended for the period of such prohibition, so long as Collateral Agent has diligently pursued removal of such process, stay or injunction. Collateral Agent shall provide CPA with reports concerning the status of efforts to cure a PPA Default upon CPA’s reasonable request.
1.4 Substitute Owner.
Subject to Section 1.7, the Parties agree that if Collateral Agent notifies (such notice, a “Financing Document Default Notice”) CPA that an event of default has occurred and is continuing under the Financing Documents (a “Financing Document Event of Default”) then, upon a judicial foreclosure sale, non-judicial foreclosure sale, deed in lieu of foreclosure or other transfer following a Financing Document Event of Default, Collateral Agent (or its designee) shall be substituted for Project Company (the “Substitute Owner”) under the PPA, and, subject to Sections
1.7(b) and 1.7(c) below, CPA and Substitute Owner will recognize each other as counterparties under the PPA and will continue to perform their respective obligations (including those obligations accruing to CPA and the Project Company prior to the existence of the Substitute Owner) under the PPA in favor of each other in accordance with the terms thereof; provided, before CPA is required to recognize the Substitute Owner, the Substitute Owner must have demonstrated to CPA’s reasonable satisfaction that the Substitute Owner has financial qualifications and operating experience [TBD] (a “Permitted Transferee”). For purposes of the foregoing, CPA shall be entitled to assume that any such purported exercise of rights by Collateral Agent that results in substitution of a Substitute Owner under the PPA is in accordance with the Financing Documents without independent investigation thereof but shall have the right to require that the Collateral Agent and its designee (if applicable) provide reasonable evidence demonstrating the same.
1.5 Replacement Agreements.
Subject to Section 1.7, if the PPA is terminated, rejected or otherwise invalidated as a result of any bankruptcy, insolvency, reorganization or similar proceeding affecting Project Company, its owner(s) or guarantor(s), and if Collateral Agent or its designee directly or indirectly takes possession of, or title to, the Facility (including possession by a receiver or title by foreclosure or deed in lieu of foreclosure) (“Replacement Owner”), CPA shall, and Collateral Agent shall cause Replacement Owner to, enter into a new agreement with one another for the balance of the obligations under the PPA remaining to be performed having terms substantially the same as the terms of the PPA with respect to the remaining Contract Term (“Replacement PPA”); provided, before CPA is required to enter into a Replacement PPA, the Replacement Owner must have demonstrated to CPA’s reasonable satisfaction that the Replacement Owner satisfies the requirements of a Permitted Transferee. For purposes of the foregoing, CPA is entitled to assume that any such purported exercise of rights by Collateral Agent that results in a Replacement Owner is in accordance with the Financing Documents without independent investigation thereof but shall have the right to require that the Collateral Agent and its designee (if applicable) provide reasonable evidence demonstrating the same. Notwithstanding the execution and delivery of a Replacement PPA, to the extent CPA is, or was otherwise prior to its termination as described in this Section 1.5, entitled under the PPA, CPA may suspend performance of its obligations under
Agenda Page 238
Exhibit O - 4
such Replacement PPA, unless and until all PPA Defaults of Project Company under the PPA or Replacement PPA have been cured.
1.6 Transfer.
Subject to Section 1.7, a Substitute Owner or a Replacement Owner may assign all of its interest in the Facility and the PPA and a Replacement PPA to a natural person, corporation, trust, business trust, joint venture, joint stock company, association, company, limited liability company, partnership, Governmental Authority or other entity (a “Person”) to which the Facility is transferred; provided, the proposed transferee shall have demonstrated to CPA’s reasonable satisfaction that such proposed transferee satisfies the requirements of a Permitted Transferee.
1.7 Assumption of Obligations.
(a) Transferee.
Any transferee under Section 1.6 shall expressly assume in a writing reasonably satisfactory to CPA all of the obligations of Project Company, Substitute Owner or Replacement Owner under the PPA or Replacement PPA, as applicable, including posting and collateral assignment of the PPA Collateral. Upon such assignment and the cure of any outstanding PPA Default, and payment of all other amounts due and payable to CPA in respect of the PPA or such Replacement PPA, the transferor shall be released from any further liability under the PPA or Replacement PPA, as applicable.
(b) Substitute Owner.
Subject to Section 1.7(c), any Substitute Owner pursuant to Section 1.4 shall be required to perform Project Company’s obligations under the PPA, including posting and collateral assignment of the PPA Collateral; provided, the obligations of such Substitute Owner shall be no more than those of Project Company under the PPA.
(c) No Liability.
CPA acknowledges and agrees that neither Collateral Agent nor any Secured Party shall have any liability or obligation under the PPAas a result of this Consent (except to the extentCollateral Agent or a Secured Party is a Substitute Owner or Replacement Owner) nor shall Collateral Agent or any other Secured Party be obligated or required to (i) perform any of Project Company’s obligations under the PPA, except as provided in Sections 1.7(a) and 1.7(b) and to the extent Collateral Agent or a Secured Party is a Substitute Owner or Replacement Owner, or (ii) take any action to collect or enforce any claim for payment assigned under the Financing Documents. If Collateral Agent becomes a Substitute Owner pursuant to Section 1.4 or enters into a Replacement PPA, Collateral Agent shall not have any personal liability to CPA under the PPA or Replacement PPA and the sole recourse of CPA in seeking enforcement of such obligations against Collateral Agent shall be to the aggregate interest of the Secured Parties in the Facility; provided, such limited recourse shall not limit CPA’s right to seek equitable or injunctive relief against Collateral Agent, or CPA’s rights with respect to any offset rights expressly allowed under the PPA, a Replacement PPA or the PPA Collateral.
1.8 Delivery of Notices.
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Exhibit O - 5
CPA shall deliver to Collateral Agent, concurrently with the delivery thereof to Project Company, a copy of each notice, request or demand given by CPA to Project Company pursuant to the PPA relating to (a) a PPA Default by Project Company under the PPA, (b) any claim regarding a Force Majeure Event by CPA under the PPA, (c) any notice of dispute under the PPA, (d) any notice of intent to terminate or any termination notice, and (e) any matter that would require the consent of Collateral Agent pursuant to Section 1.11 or any other provision of this Consent. Collateral Agent acknowledges that delivery of such notice, request and demand shall satisfy CPA’s obligation to give Collateral Agent a notice of PPA Default under Section 1.3. Collateral Agent shall deliver to CPA, concurrently with delivery thereof to Project Company, a copy of each notice, request or demand given by Collateral Agent to Project Company pursuant to the Financing Documents relating to a default by Project Company under the Financing Documents.
1.9 Confirmations.
CPA will, as and when reasonably requested by Collateral Agent from time to time, confirm in writing matters relating to the PPA (including the performance of same by Project Company); provided, such confirmation may be limited to matters of which CPA is aware as of the time the confirmation is given and such confirmations shall be without prejudice to any rights of CPA under the PPA as between CPA and Project Company.
1.10 Exclusivity of Dealings.
Except as provided in Sections 1.3, 1.4, 1.8, 1.9 and 2.1, unless and until CPA receives a Financing Document Default Notice, CPA shall deal exclusively with Project Company in connection with the performance of CPA’s obligations under the PPA. From and after such time as CPA receives a Financing Document Default Notice and until a Substitute Owner is substituted for Project Company pursuant to Section 1.4, a Replacement PPA is entered into or the PPA is transferred to a Person to whom the Facility is transferred pursuant to Section 1.6, CPA shall, until Collateral Agent confirms to CPA in writing that all obligations under the Financing Documents are no longer outstanding, deal exclusively with Collateral Agent in connection with the performance of CPA’s obligations under the PPA, and CPA may irrevocably rely on instructions provided by Collateral Agent in accordance therewith to the exclusion of those provided by any other Person.
1.11 No Amendments.
To the extent permitted by Laws, CPA agrees that it will not, without the prior written consent of Collateral Agent (not to be unreasonably withheld, delayed or conditioned) (a) enter into any material supplement, restatement, novation, extension, amendment or modification of the PPA (b) terminate or suspend its performance under the PPA (except in accordance with Section 1.3) or (c) consent to or accept any termination or cancellation of the PPA by Project Company.
SECTION 2. PAYMENTS UNDER THE PPA
2.1 Payments.
Unless and until CPA receives written notice to the contrary from Collateral Agent, CPA will make all payments to be made by it to Project Company under or by reason of the PPA directly to Project Company. CPA, Project Company, and Collateral Agent acknowledge that CPA will be deemed
Agenda Page 240
Exhibit O - 6
to be in compliance with the payment terms of the PPA to the extent that CPA makes payments in accordance with Collateral Agent’s instructions.
2.2 No Offset, Etc.
All payments required to be made by CPA under the PPA shall be made without any offset, recoupment, abatement, withholding, reduction or defense whatsoever, other than that expressly allowed by the terms of the PPA.
SECTION 3. REPRESENTATIONS AND WARRANTIES OF CPA
CPA makes the following representations and warranties as of the date hereof in favor of Collateral Agent:
3.1 Organization.
CPA is a joint powers authority and community choice aggregator duly organized and validly existing under the laws of the state of California, and the rules, regulations and orders of the California Public Utilities Commission, and is qualified to conduct business in each jurisdiction of the Joint Powers Agreement members. CPA has all requisite power and authority, corporate and otherwise, to enter into and to perform its obligations hereunder and underthe PPA, and to carry out the terms hereof and thereof and the transactions contemplated hereby and thereby.
3.2 Authorization.
The execution, delivery and performance by CPA of this Consent and the PPA have been duly authorized by all necessary corporate or other action on the part of CPA and do not require any approval or consent of any holder (or any trustee for any holder) of any indebtedness or other obligation of CPA which, if not obtained, will prevent CPA from performing its obligations hereunder or under the PPA except approvals or consents which have previously been obtained and which are in full force and effect.
3.3 Execution and Delivery; Binding Agreements.
Each of this Consent and the PPA is in full force and effect, hasbeen duly executed and delivered on behalf of CPA by the appropriate officers of CPA, and constitutes the legal, valid and binding obligation of CPA, enforceable against CPA in accordance with its terms, except as the enforceability thereof may be limited by (a) bankruptcy, insolvency, reorganization, moratorium or other similar laws of general application affecting the enforcement of creditors’ rights generally and (b) general equitable principles (whether considered in a proceeding in equity or at law).
3.4 No Default or Amendment.
Except as set forth in Schedule A attached hereto: (a) Neither CPA nor, to CPA’s actual knowledge, Project Company, is in default of any of its obligations under the PPA; (b) CPA and, to CPA’s actual knowledge, Project Company, has complied with all conditions precedent to the effectiveness of its obligations under the PPA; (c) to CPA’s actual knowledge, no event or condition exists which would either immediately or with the passage of any applicable grace period
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Exhibit O - 7
or giving of notice, or both, enable either CPA or Project Company to terminate or suspend its obligations under the PPA; and (d) the PPA has not been amended, modified or supplemented in any manner except as set forth herein and in the recitals hereto.
3.5 No Previous Assignments.
CPA has no notice of, and has not consented to, any previous assignment by Project Company of all or any part of its rights under the PPA, except as previously disclosed in writing and consented to by CPA.
SECTION 4. REPRESENTATIONS AND WARRANTIES OF PROJECT COMPANY Project Company makes the following representations and warranties as of the date hereof in favor of the Collateral Agent and CPA:
4.1 Organization.
Project Company is a [Legal Status of Seller] duly organized and validly existing under the laws of the state of its organization, and is duly qualified, authorized to do business and in good standing in every jurisdiction in which it owns or leases real property or in which the nature of its business requires it to be so qualified, except where the failure to so qualify would not have a material adverse effect on its financial condition, its ability to own its properties or its ability to transact its business. Project Company has all requisite power and authority, corporate and otherwise, to enter into and to perform its obligations hereunder and under the PPA, and to carry out the terms hereof and thereof and the transactions contemplated hereby and thereby.
4.2 Authorization.
The execution, delivery and performance of this Consent by Project Company, and Project Company’s assignment of its right, title and interest in, to and under the PPA to the Collateral Agent pursuant to the Financing Documents, have been duly authorized by all necessary corporate or other action on the part of Project Company.
4.3 Execution and Delivery; Binding Agreement.
This Consent is in full force and effect, has been duly executed and delivered on behalf of Project Company by the appropriate officers of Project Company, and constitutes the legal, valid and binding obligation of Project Company, enforceable against Project Company in accordance with its terms, except as the enforceability thereof may be limited by (a) bankruptcy, insolvency, reorganization, moratorium or other similar laws of general application affecting the enforcement of creditors’ rights generally and (b) general equitable principles (whether considered in a proceeding in equity or at law).
4.4 No Default or Amendment.
Except as set forth in Schedule B attached hereto: (a) neither Project Company nor, to Project Company’s actual knowledge, CPA, is in default of any of its obligations under the PPA;; (b) Project Company and, to Project Company’s actual knowledge, CPA, has complied with all conditions precedent to the effectiveness of its obligations under the PPA; (c) to Project
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Exhibit O - 8
Company’s actual knowledge, no event or condition exists which would either immediately or with the passage of any applicable grace period or giving of notice, or both, enable either CPA or Project Company to terminate or suspend its obligations under the PPA; and (d) the PPA has not been amended, modified or supplemented in any manner except as set forth herein and in the recitals hereto.
4.5 No Previous Assignments.
Project Company has not previously assigned all or any part of its rights under the PPA.
SECTION 5. REPRESENTATIONS AND WARRANTIES OF COLLATERAL AGENT Collateral Agent makes the following representations and warranties as of the date hereof in favor of CPA and Project Company:
5.1 Authorization.
The execution, delivery and performance of this Consent by Collateral Agent have been duly authorized by all necessary corporate or other action on the part of Collateral Agent and Secured Parties.
5.2 Execution and Delivery; Binding Agreement.
This Consent is in full force and effect, has been duly executed and delivered on behalf of Collateral Agent by the appropriate officers of Collateral Agent, and constitutes the legal, valid and binding obligation of Collateral Agent as Collateral Agent for the Secured Parties, enforceable against Collateral Agent (and the Secured Parties to the extent applicable) in accordance with its terms, except as the enforceability thereof may be limited by (a) bankruptcy, insolvency, reorganization, moratorium or other similar laws of general application affecting the enforcement of creditors’ rights generally and (b) general equitable principles (whether considered in a proceeding in equity or at law).
SECTION 6. MISCELLANEOUS
6.1 Notices.
All notices and other communications hereunder shall be in writing, shall be deemed given upon receipt thereof by the Party or Parties to whom such notice is addressed, shall refer on their face to the PPA (although failure to so refer shall not render any such notice or communication ineffective), shall be sent by first class mail, by personal delivery or by a nationally recognized courier service, and shall be directed (a) if to CPA or Project Company, in accordance with [Notice Section of the PPA] of the PPA, (b) if to Collateral Agent, to [Collateral Agent Name], [Collateral Agent Address], Attn: [Collateral Agent Contact Information], Telephone: [___], Fax: [___], and (c) to such other address or addressee as any such Party may designate by notice given pursuant hereto.
6.2 Governing Law; Submission to Jurisdiction.
(a) THIS CONSENT SHALL BE CONSTRUED IN ACCORDANCE WITH, AND THIS
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Exhibit O - 9
CONSENT AND ALL MATTERS ARISING OUT OF THIS CONSENT AND THE TRANSACTIONS
CONTEMPLATED HEREBY SHALL BE GOVERNED BY, THE LAW OF THE STATE OF
CALIFORNIA WITHOUT REGARD TO ANY CONFLICTS OF LAWS PROVISIONS THEREOF THAT WOULD RESULT IN THE APPLICATION OF THE LAW OF ANOTHER JURISDICTION. (b) All disputes, claims or controversies arising out of, relating to, concerning or pertaining to the terms of this Consent shall be governed by the dispute resolution provisions of the PPA. Subject to the foregoing, any legal action or proceeding with respect to this Consent and any action for enforcement of any judgment in respect thereof may be brought in the courts of the State of California or of the United States of America for the Central District of California, and, by execution and delivery of this Consent, each Party hereby accepts for itself and in respect of its property, generally and unconditionally, the non-exclusive jurisdiction of the aforesaid courts and appellate courts from any appeal thereof. Each Party further irrevocably consents to the service of process out of any of the aforementioned courts in any such action or proceeding by the mailing of copies thereof by registered or certified mail, postage prepaid, to its notice address provided pursuant to Section 6.1 hereof. Each Party hereby irrevocably waives any objection which it may now or hereafter have to the laying of venue of any of the aforesaid actions or proceedings arising out of or in connection with this Consent brought in the courts referred to above and hereby further irrevocably waives and agrees not to plead or claim in any such court that any such action or proceeding brought in any such court has been brought in an inconvenient forum. Nothing herein shall affect the right of any Party to serve process in any other manner permitted by law.
6.3 Headings Descriptive.
The headings of the several sections and subsections of this Consent are insertedfor convenience only and shall not in any way affect the meaning or construction of any provision of this Consent.
6.4 Severability.
In case any provision in or obligation under this Consent shall be invalid, illegal or unenforceable in any jurisdiction, the validity, legality and enforceability of the remaining provisions or obligations, or of such provision or obligation in any other jurisdiction, shall not in any way be affected or impaired thereby.
6.5 Amendment, Waiver.
Neither this Consent nor any of the terms hereof may (a) be terminated, amended, supplemented or modified, except by an instrument in writing signed by CPA, Project Company and Collateral Agent or (b) waived, except by an instrument in writing signed by the waiving Party.
6.6 Termination.
Each Party’s obligations hereunder are absolute and unconditional, and no Party has any right, and shall have no right, to terminate this Consent or to be released, relieved or discharged from any obligation or liability hereunder until CPA has been notified by Collateral Agent that all of the obligations under the Financing Documents shall have been satisfied in full (other than contingent indemnification obligations) or, with respect to the PPA or any Replacement PPA, its obligations under such PPA or Replacement PPA have been fully performed.
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Exhibit O - 10
6.7 Successors and Assigns.
This Consent shall be binding upon each Party and its successors and assigns permitted under and in accordance with this Consent, and shall inure to the benefit of the other Parties and their respective successors and assignee permitted under and in accordance with this Consent. Each reference to a Person herein shall include such Person’s successors and assigns permitted under and in accordance with this Consent.
6.8 Further Assurances.
CPA hereby agrees to execute and deliver all such instruments and take all such action as may be necessary to effectuate fully the purposes of this Consent.
6.9 Waiver of Trial by Jury.
TO THE EXTENT PERMITTED BY APPLICABLE LAWS, THE PARTIES HEREBY
IRREVOCABLY WAIVE ALL RIGHT OF TRIAL BY JURY IN ANY ACTION,
PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR IN CONNECTION WITH THIS CONSENT OR ANY MATTER ARISING HEREUNDER. EACH PARTY FURTHER
WARRANTS AND REPRESENTS THAT IT HAS REVIEWED THIS WAIVER WITH ITS
LEGAL COUNSEL, AND THAT IT KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL.
6.10 Entire Agreement.
This Consent and any agreement, document or instrument attached hereto or referred to herein integrate all the terms and conditions mentioned herein or incidental hereto and supersede all oral negotiations and prior writings in respect to the subject matter hereof. In the event of any conflict between the terms, conditions and provisions of this Consent and any such agreement, document or instrument, the terms, conditions and provisions of this Consent shall prevail.
6.11 Effective Date.
This Consent shall be deemed effective as of the date upon which the last Party executes this Consent.
6.12 Counterparts; Electronic Signatures.
This Consent may be executed in one or more counterparts, each of which will be deemed to be an original of this Consent and all of which, when taken together, will be deemed to constitute one and the same agreement. The exchange of copies of this Consent and of signature pages by facsimile transmission, Portable Document Format (i.e., PDF), or by other electronic means shall constitute effective execution and delivery of this Consent as to the Parties and may be used in lieu of the original Consent for all purposes.
[Remainder of Page Left Intentionally Blank.]
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Exhibit O - 11
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Exhibit O - 12
IN WITNESS WHEREOF, the Parties hereto have caused this Consent to be duly executed and delivered by their duly authorized officers on the dates indicated below their respective signatures. [NAME OF PROJECT COMPANY],
[Legal Status of Project Company].
CLEAN POWER ALLIANCE OF
SOUTHERN CALIFORNIA,
a California joint powers authority.
By:
___________________________________
[Name]
[Title]
Date: ___________________________
By:
___________________________________
[Name]
[Title]
Date: ___________________________
[NAME OF COLLATERAL AGENT],
[Legal Status of Collateral Agent].
By:
________________________________
[Name]
[Title]
Date: ___________________________
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Exhibit O - 13
SCHEDULE A
[Describe any disclosures relevant to representations and warranties made in Section 3.4]
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Exhibit P – 1
EXHIBIT P
[Intentionally Omitted]
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Exhibit Q – 1
EXHIBIT Q
Supply Chain Code of Conduct
Buyer is committed to ensuring that the fundamental human rights of workers are protected, including addressing the potential risks of forced labor, child labor, servitude, human trafficking and slavery across our portfolio.
Our requirements and expectations for Seller’s supply chain are detailed below in our Supply Chain Code of Conduct (“Supply Chain Code”). Seller must comply with all applicable Laws and this Supply Chain Code, even when this Supply Chain Code exceeds the requirements of applicable Law.
These standards are derived from the United Nations Guiding Principles on Business and Human Rights, the Core Conventions of the International Labour Organization (“ILO”), including the ILO Declaration on Fundamental Principles and Rights at Work, the Solar Energy Industries Association Solar Industry Commitment to Environmental & Social Responsibility, and the Responsible Business Alliance Code of Conduct.
1. Freely Chosen Employment
Forced, bonded (including debt bondage) or indentured labor, involuntary or exploitative prison labor, slavery or trafficking of persons is not permitted. This includes transporting, harboring, recruiting, transferring, or receiving persons by means of threat, force, coercion, abduction or fraud for labor or services. There shall be no unreasonable restrictions on workers’ freedom of movement in the facility in addition to unreasonable restrictions on entering or exiting company provided facilities including, if applicable, workers’ dormitories or living quarters. All work must be voluntary, and workers shall be free to leave work at any time or terminate their employment without penalty if reasonable notice is given as per worker’s contract. Employers, agents, and sub-agents’ may not hold or otherwise destroy, conceal, or confiscate identity or immigration documents, such as government-issued identification, passports, or work permits. Employers can only hold documentation if such holdings are required by law. In this case, at no time should workers be denied access to their documents. Workers shall not be required to pay employers’ agents or sub-agents’ recruitment fees or other related fees for their employment. If any such fees are found to have been paid by workers, such fees shall be repaid to the worker.
2. Young Workers
Child labor is not to be used in any stage of manufacturing. The term “child” refers to any person under the age of 15, or under the age for completing compulsory education, or under the minimum age for employment in the country, whichever is greatest. Suppliers shall implement an appropriate mechanism to verify the age of workers. The use of legitimate workplace learning programs, which comply with all laws and regulations, is supported.
Workers under the age of 18 shall not perform work that is likely to jeopardize their health or safety, including night shifts and overtime. Suppliers shall ensure proper management of student workers through proper maintenance of student records, rigorous due diligence of educational partners, and protection of students’ rights in accordance with applicable laws and regulations. Suppliers shall provide appropriate support and training to all student workers. In the absence of local law, the wage rate for student workers, interns, and apprentices shall be at least the same wage rate as other entry-level workers performing
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Exhibit Q - 2
equal or similar tasks. If child labor is identified, assistance/remediation is provided.
3. Working Hours
Studies of business practices clearly link worker strain to reduced productivity, increased turnover, and increased injury and illness. Working hours are not to exceed the maximum set by local law. Further, a workweek should not be more than 60 hours per week, including overtime, except in emergency or unusual situations. All overtime must be voluntary.
Workers shall be allowed at least one day off every seven days.
4. Wages and Benefits
Compensation paid to workers shall comply with all applicable wage laws, including those relating to minimum wages, overtime hours and legally mandated benefits. In compliance with local laws, workers shall be compensated for overtime at pay rates greater than regular hourly rates. Deductions from wages as a disciplinary measure shall not be permitted. For each pay period, workers shall be provided with a timely and understandable wage statement that includes sufficient information to verify accurate compensation for work performed. All use of temporary, dispatch and outsourced labor will be within the limits of the local law.
5. Humane Treatment
There is to be no harsh or inhumane treatment including violence, gender-based violence, sexual harassment, sexual abuse, corporal punishment, mental or physical coercion, bullying, public shaming, or verbal abuse of workers; nor is there to be the threat of any such treatment. Disciplinary policies and procedures in support of these requirements shall be clearly defined and communicated to workers.
6. Non-Discrimination/Non-Harassment
Suppliers should be committed to a workplace free of harassment and unlawful discrimination. Companies shall not engage in discrimination or harassment based on race, color, age, gender, sexual orientation, gender identity and expression, ethnicity or national origin, disability, pregnancy, religion, political affiliation, union membership, covered veteran status, protected genetic information or marital status in hiring and employment practices such as wages, promotions, rewards, and access to training. Workers shall be provided with reasonable accommodation for religious practices. In addition, workers or potential workers should not be subjected to medical tests that could be used in a discriminatory way or otherwise in violation of applicable law. This was drafted in consideration of ILO Discrimination (Employment and Occupation) Convention (No.111).
7. Freedom of Association
In conformance with local law, Suppliers shall respect the right of all workers to form and join trade unions of their own choosing, to bargain collectively, and to engage in peaceful assembly as well as respect the right of workers to refrain from such activities. Workers and/or their representatives shall be able to openly communicate and share ideas and concerns with management regarding working conditions and management practices without fear of discrimination, reprisal, intimidation, or harassment.
8. Restricted Jurisdictions
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Exhibit Q - 3
Supplier shall not manufacture or produce products in the Xinjiang Uyghur Autonomous Region of China, or knowingly procure goods and services mined, produced or manufactured in the same.
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Exhibit R – 1
EXHIBIT R
METERING DIAGRAM
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Exhibit S – 1
EXHIBIT S
MATERIAL PERMITS
No. Permits
1 Ventura County Conditional Use Permit
2 Agenda Page 254
Exhibit T – 1
EXHIBIT T
Force Majeure and/or Development Cure Period Claim Form Instructions
A. Please review Article 10 and Exhibit B (if applicable) of the Power Purchase Agreement prior to filling out the form.
B. Fill out the form completely and return to your assigned Contract Manager at CPA.
Seller: [Name] Project: [Name]
Current Guaranteed Construction Start Date: [Date]
New Guaranteed Construction Start Date (if Seller’s claims are validated in full): [Date] Guaranteed Commercial Operation Date: [Date]
New Guaranteed Commercial Operation Date (if Seller’s claims are validated in full):
[Date]
1. Please describe the claimed Force Majeure Event or other event giving rise to the claimed Development Cure Period delay(s) (the “Claimed Event”), including its cause, date of commencement and date it ended or is anticipated to end.
2. Please specify the extent of the delay or prevented performance caused by the Claimed Event, including the relief claimed thereby. Describe how the claimed relief was calculated/determined, accounting for individual developments causing such delay or prevented performance.
3. With respect to a Claimed Event other than a Force Majeure Event, please describe the commercially reasonable efforts taken by Seller to prevent such event.
4. Please describe the commercially reasonable efforts taken to mitigate the delays or nonperformance caused by the Claimed Event and specify how such efforts reduced the delay days or nonperformance that would otherwise have occurred absent such mitigation.
5. Please attach supporting documentation, including without limitation:
• Force Majeure notices or other correspondence received from suppliers and/or contractors that describe the basis for and extent of the Claimed Event. • Documentation, contracts, and/or correspondence with suppliers and/or contractors
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Exhibit T - 2
evidencing the claiming Party’s mitigation efforts.
• Project schedule and/or GANTT charts that demonstrate the effect of the Claimed Event on the Guaranteed commercial Operation Date.
By signing this Claim form, I attest and affirm that I am authorized to sign this form on behalf of the Seller, that I have reviewed this Claim, including any attached documentation, and that the facts and statements made in this Claim are true and correct to the best of my knowledge.
Signed:
Name:
Title:
Date:
Agenda Page 256
EXECUTION VERSION
RENEWABLE POWER PURCHASE AGREEMENT
COVER SHEET
Seller: Fillmore Sun Farms, LLC
Buyer: Clean Power Alliance of Southern California, a California joint powers authority Description of Facility: Fillmore Solar, a 2.46 MWAC (3.43 MWDC) photovoltaic project.
Milestones:
Milestone Expected Date for
Completion
Evidence of Site Control 6/22/2024
Documentation of Conditional Use Permit if required:
CEQA [ ] Cat Ex, [X] Neg Dec, [ ] Mitigated Neg Dec,
[ ] EIR
12/31/2026
Seller’s receipt of Phase I and Phase II Interconnection study results for Seller’s Interconnection Facilities N/A Executed Interconnection Agreement Completed
Financial Close
Expected Construction Start Date 12/31/2027
Initial Synchronization 6/15/2028
Network Upgrades completed (evidenced by delivery of
permission to parallel letter from the Transmission
Provider)
6/30/2028
Expected Date of CAISO Commercial Operation 6/30/2028
Expected Commercial Operation Date 6/30/2028
Delivery Term: Twenty (20) Contract Years
Delivery Term Expected Energy:
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Contract Year Expected Energy (MWh)
1 7,615
2 7,577
3 7,539
4 7,521
5 7,464
6 7,426
7 7,389
8 7,371
9 7,316
10 7,279
11 7,243
12 7,225
13 7,170
14 7,134
15 7,099
16 7,082
17 7,028
18 6,993
19 6,958
20 6,941
Guaranteed Capacity: 2.46 MWAC of total Facility capacity Renewable Rate:
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Contract Year Renewable Rate ($/MWh)
1 – 20 $ / MWh (flat) with
no escalation
Seller’s Assumed Tax Credits: As of the Effective Date, the Renewable Rate set forth above on the Cover Sheet assumes the Facility will qualify for the ITC at zero percent (0%) and/or the PTC at $0.00/kWh for the Facility.
Guaranteed Construction Start Date: 6/30/2028
Guaranteed Commercial Operation Date: 12/31/2028
Product
☒ Energy
☒ Green Attributes (if Renewable Energy Credit, please check the applicable box below):
☒ Portfolio Content Category 1
☐ Portfolio Content Category 2
☐ Portfolio Content Category 3
☐ Imbalance Reserves
☐ Capacity Attributes
Scheduling Coordinator: Buyer
Security Amounts:
Development Security: $105/kW of Guaranteed Capacity
Performance Security: $105/kW of Installed Capacity
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TABLE OF CONTENTS
Page
i
ARTICLE 1 DEFINITIONS ............................................................................................................1
1.1 Contract Definitions .................................................................................................1
1.2 Rules of Interpretation ...........................................................................................18 ARTICLE 2 TERM; CONDITIONS PRECEDENT .....................................................................19
2.1 Contract Term ........................................................................................................19
2.2 Conditions Precedent .............................................................................................20
2.3 Development; Construction; Progress Reports ......................................................21
2.4 Remedial Action Plan ............................................................................................22
2.5 Low-Income Community Bonus............................................................................22 ARTICLE 3 PURCHASE AND SALE .........................................................................................22
3.1 Purchase and Sale of Product .................................................................................22
3.2 Sale of Green Attributes.........................................................................................22
3.3 Imbalance Energy ..................................................................................................22
3.4 Ownership of Renewable Energy Incentives .........................................................23
3.5 Future Environmental Attributes ...........................................................................23
3.6 Test Energy ............................................................................................................23
3.7 CEC Certification and Verification .......................................................................24
3.8 Eligibility ...............................................................................................................24
3.9 California Renewables Portfolio Standard .............................................................24
3.10 Compliance Expenditure Cap ................................................................................24
3.11 Project Configuration .............................................................................................25 ARTICLE 4 OBLIGATIONS AND DELIVERIES ......................................................................25
4.1 Delivery..................................................................................................................25
4.2 Title and Risk of Loss ............................................................................................26
4.3 Forecasting .............................................................................................................26
4.4 Dispatch Down/Curtailment ..................................................................................28
4.5 Station Use .............................................................................................................28
4.6 Facility Maintenance ..............................................................................................29
4.7 Guaranteed Energy Production ..............................................................................29
4.8 WREGIS ................................................................................................................30 ARTICLE 5 TAXES ......................................................................................................................31
5.1 Allocation of Taxes and Charges ...........................................................................31
5.2 Cooperation ............................................................................................................32 ARTICLE 6 MAINTENANCE OF THE FACILITY ...................................................................32
6.1 Maintenance of the Facility ...................................................................................32
6.2 Maintenance of Health and Safety .........................................................................32
6.3 Shared Facilities .....................................................................................................32 ARTICLE 7 METERING ..............................................................................................................33
7.1 Metering .................................................................................................................33
7.2 Meter Verification ..................................................................................................33
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ii
ARTICLE 8 INVOICING AND PAYMENT; CREDIT ...............................................................34
8.1 Invoicing ................................................................................................................34
8.2 Payment..................................................................................................................34
8.3 Books and Records ................................................................................................34
8.4 Payment Adjustments; Billing Errors ....................................................................34
8.5 Billing Disputes .....................................................................................................35
8.6 Netting of Payments ...............................................................................................35
8.7 Seller’s Development Security ..............................................................................35
8.8 Seller’s Performance Security................................................................................35
8.9 First Priority Security Interest in Cash or Cash Equivalent Collateral ..................36 ARTICLE 9 NOTICES ..................................................................................................................36
9.1 Addresses for the Delivery of Notices ...................................................................36
9.2 Acceptable Means of Delivering Notice ................................................................37 ARTICLE 10 FORCE MAJEURE ................................................................................................37
10.1 Definition ...............................................................................................................37
10.2 No Liability If a Force Majeure Event Occurs ......................................................38
10.3 Notice .....................................................................................................................38
10.4 Termination Following Force Majeure Event or Development Cure Period ........38 ARTICLE 11 DEFAULTS; REMEDIES; TERMINATION ........................................................39
11.1 Events of Default ...................................................................................................39
11.2 Remedies; Declaration of Early Termination Date ................................................41
11.3 Damage Payment; Termination Payment ..............................................................41
11.4 Notice of Payment of Termination Payment or Damage Payment ........................42
11.5 Disputes With Respect to Termination Payment or Damage Payment .................43
11.6 Limitation on Seller’s Ability to Make or Agree to Third-Party Sales from the Facility after Early Termination Date ..............................................................43
11.7 Rights And Remedies Are Cumulative ..................................................................43
11.8 Mitigation ...............................................................................................................43 ARTICLE 12 LIMITATION OF LIABILITY AND EXCLUSION OF WARRANTIES............43
12.1 No Consequential Damages ...................................................................................43
12.2 Waiver and Exclusion of Other Damages ..............................................................44 ARTICLE 13 REPRESENTATIONS AND WARRANTIES; AUTHORITY .............................45
13.1 Seller’s Representations and Warranties ...............................................................45
13.2 Buyer’s Representations and Warranties ...............................................................46
13.3 General Covenants .................................................................................................47
13.4 Workforce Development ........................................................................................47 ARTICLE 14 ASSIGNMENT .......................................................................................................47
14.1 General Prohibition on Assignments .....................................................................47
14.2 Collateral Assignment ............................................................................................48
14.3 Permitted Assignment by Seller.............................................................................48
14.4 Shared Facilities; Portfolio Financing ...................................................................48
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iii
14.5 Buyer Financing Assignment .................................................................................48 ARTICLE 15 DISPUTE RESOLUTION ......................................................................................49
15.1 Governing Law ......................................................................................................49
15.2 Dispute Resolution .................................................................................................49
15.3 Attorneys’ Fees ......................................................................................................49
15.4 Venue .....................................................................................................................49 ARTICLE 16 INDEMNIFICATION .............................................................................................49
16.1 Indemnification ......................................................................................................49
16.2 Claims ....................................................................................................................50 ARTICLE 17 INSURANCE ..........................................................................................................50
17.1 Insurance ................................................................................................................50 ARTICLE 18 CONFIDENTIAL INFORMATION ......................................................................52
18.1 Definition of Confidential Information ..................................................................52
18.2 Duty to Maintain Confidentiality ...........................................................................52
18.3 Irreparable Injury; Remedies .................................................................................53
18.4 Further Permitted Disclosure .................................................................................53
18.5 Press Releases ........................................................................................................53 ARTICLE 19 MISCELLANEOUS ...............................................................................................53
19.1 Entire Agreement; Integration; Exhibits ................................................................53
19.2 Amendments ..........................................................................................................54
19.3 No Waiver ..............................................................................................................54
19.4 No Agency, Partnership, Joint Venture or Lease ...................................................54
19.5 Severability ............................................................................................................54
19.6 Mobile-Sierra .........................................................................................................54
19.7 Counterparts ...........................................................................................................55
19.8 Electronic Delivery ................................................................................................55
19.9 Binding Effect ........................................................................................................55
19.10 No Recourse to Members of Buyer .......................................................................55
19.11 Forward Contract ...................................................................................................55
19.12 Change in Electric Market Design .........................................................................55
19.13 Further Assurances.................................................................................................55
19.14 Service Contract .....................................................................................................56
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iv
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 [Intentionally Omitted]
Exhibit J Form of Construction Start Date Certificate
Exhibit K Form of Letter of Credit
Exhibit L Form of Limited Assignment Agreement
Exhibit M [Intentionally Omitted]
Exhibit N Notices
Exhibit O Form of Consent to Collateral Assignment
Exhibit P [Intentionally Omitted]
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
Agenda Page 263
RENEWABLE POWER PURCHASE AGREEMENT
This Renewable Power Purchase Agreement (“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; and
WHEREAS, Seller desires to sell, and Buyer desires to purchase, on the terms and conditions set forth in this Agreement, the Product;
NOW THEREFORE, in consideration of the mutual covenants and agreements herein contained, and for other good and valuable consideration, the sufficiency and adequacy of which are hereby acknowledged, the Parties agree to the following:
ARTICLE 1
DEFINITIONS
1.1 Contract Definitions. The following terms, when used herein with initial capitalization, shall have the meanings set forth below:
“AC” means alternating current.
“Accepted Compliance Costs” has the meaning set forth in Section 3.10(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. “APC Contract Price” has the meaning set forth in Exhibit L. “Approval Application” has the meaning set forth in Section 2.1(c).
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2 “Approved Forecast Vendor” means any of (a) CAISO or (b) any other vendor reasonably acceptable to both Buyer and Seller for the purposes of providing or verifying the forecasts under Section 4.3(d).
“Assignment Agreement” has the meaning set forth in Section 14.5. “Automated Dispatch System” or “ADS” has the meaning set forth in the CAISO Tariff. “Automatic Generation Control” or “AGC” has the meaning set forth in the CAISO Tariff.
“Available Capacity” means the capacity of the Facility, expressed in whole MWs, that is available to generate Energy.
“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. “Buyer Bid Curtailment” means the occurrence of both of the following:
(a) the CAISO provides notice to a Party or the Scheduling Coordinator for the Facility, requiring the Party to deliver less Facility Energy from the Facility than the full amount of Energy forecasted in accordance with Section 4.3 to be produced from the Facility for a period of time; and
(b) for the same time period as referenced in (a), Buyer or the SC for the Facility did not submit a Self-Schedule for the MWhs subject to the reduction.
If the Facility is subject to a Planned Outage, Forced Facility Outage, Force Majeure Event and/or a Curtailment Period during the same time period as referenced in (a), then the calculation of Deemed Delivered Energy during such period shall not include any Facility Energy that was not generated or stored due to such Planned Outage, Forced Facility Outage, Force Majeure Event or Curtailment Period.
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3 “Buyer Curtailment Order” means the instruction from Buyer to Seller to reduce Facility Energy from the Facility by the amount, and for the period of time set forth in such instruction, for reasons unrelated to a Planned Outage, Forced Facility Outage, Force Majeure Event affecting the Facility and/or Curtailment Order.
“Buyer Curtailment Period” means the period of time, as measured using current Settlement Intervals, during which Seller reduces Facility Energy from the Facility pursuant to or as a result of (a) a Buyer Bid Curtailment, (b) a Buyer Curtailment Order, or (c) a Buyer Default hereunder which directly causes Seller to be unable to deliver Energy to the Delivery Point; provided, the duration of any Buyer Curtailment Period shall be inclusive of the time required for the Facility to ramp down and ramp up.
“Buyer Default” means an Event of Default of Buyer.
“Buyer’s Indemnified Parties” has the meaning set forth in Section 18.2. “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.
“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 associated with such generating units, that are applicable to the Facility.
“CAISO Charges Invoice” has the meaning set forth in Exhibit D. “CAISO Commercial Operation” has the meaning of “Commercial Operation” set forth in the CAISO Tariff.
“CAISO Grid” has the same meaning as “CAISO Controlled Grid” as defined in the CAISO Tariff.
“CAISO Resource ID” has the same meaning as “Resource ID” 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.
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4 “CEC” means the California Energy Commission or its successor agency. “CEC Certification and Verification” means that the CEC has certified (or, with respect to periods before the date that is one hundred eighty (180) days following the Commercial Operation Date, that the CEC has pre-certified) that the Facility is an Eligible Renewable Energy Resource for purposes of the California Renewables Portfolio Standard and that all Facility Energy delivered to the Delivery Point qualifies as generation from an Eligible Renewable Energy Resource.
“CEC Precertification” means that the CEC has issued a precertification for the Facility indicating that the planned operations of the Facility would comply with applicable CEC requirements for CEC Certification and Verification.
“Change of Control” means, except in connection with public market transactions of equity interests or capital stock of Seller’s Ultimate Parent, any circumstance in which Ultimate Parent ceases to own, directly or indirectly through one or more intermediate entities, more than fifty percent (50%) of the outstanding equity interests in Seller; provided, in calculating ownership percentages for all purposes of the foregoing:
(a) any ownership interest in Seller held by Ultimate Parent indirectly through one or more intermediate entities shall not be counted towards Ultimate Parent’s ownership interest in Seller unless Ultimate Parent directly or indirectly owns more than fifty percent (50%) of the outstanding equity interests in each such intermediate entity; and (b) ownership interests in Seller owned directly or indirectly by any Lender (including any tax equity provider) shall be excluded from the total outstanding equity interests in Seller.
“COD Certificate” 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) ninety (90). “Compliance Actions” has the meaning set forth in Section 3.10(a). “Compliance Expenditure Cap” has the meaning set forth in Section 3.10. “Confidential Information” has the meaning set forth in Section 18.1. “Consent to Collateral Assignment” has the meaning set forth in Section 14.2. “Construction Start” has the meaning set forth in Exhibit B. “Construction Start Date” has the meaning set forth in Exhibit B.
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5 “Contract Term” has the meaning set forth in Section 2.1. “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 epidemic 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.
“CPUC” means the California Public Utilities Commission, or successor entity. “CPUC Approval” means a final and non-appealable order, decision, or disposition of the CPUC, without conditions or modifications unacceptable to the Parties, or either of them, which approves this Agreement in its entirety, including payments to be made by Buyer, subject to CPUC review of Buyer’s administration of this Agreement. CPUC Approval will be deemed to have occurred on the date that a CPUC order, decision, or disposition containing such findings becomes final and non-appealable.
“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, 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 Buyer or the SC for the Facility submitted a Self-Schedule for the MWhs curtailed corresponding to the MWhs in the VER forecast for the Facility during the relevant time period; (b) a curtailment ordered by the Transmission Provider for reasons including, but not limited to, (i) any situation that affects normal function of the electric system including,
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6 but not limited to, any abnormal condition that requires action to prevent circumstances such as equipment damage, loss of load, or abnormal voltage conditions, or (ii) any warning, forecast or anticipation of conditions or situations that jeopardize the Transmission Provider’s electric system integrity or the integrity of other systems to which the Transmission Provider is connected; (c) a curtailment ordered by CAISO or the Transmission Provider due to a Transmission System Outage; or
(d) a curtailment in accordance with Seller’s obligations under its Interconnection Agreement with the Transmission Provider or distribution operator. “Curtailment Period” means the period of time, as measured using current Settlement Intervals, during which Seller reduces generation 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.
“Daily Delay Damages” means an amount equal to (a) the Development Security amount required hereunder, divided by (b) one hundred twenty (120). “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). “Day-Ahead Forecast” has the meaning set forth in Section 4.3(c). “Day-Ahead Market” has the meaning set forth in the CAISO Tariff. “Day-Ahead Schedule” has the meaning set forth in the CAISO Tariff. “Deemed Delivered Energy” means the amount of Energy expressed in MWh that the Facility would have produced and delivered to the Facility Meter, but that is not produced by the Facility during a Buyer Curtailment Period, which amount shall be equal to the Real-Time Forecast (of the hourly expected Facility Energy produced by the Facility) provided pursuant to Section
4.3(d) for the period of time during the Buyer Curtailment Period (or other relevant period), less the amount of Facility Energy delivered to the Delivery Point during the Buyer Curtailment Period (or other relevant period); provided, if the applicable difference is negative, the Deemed Delivered Energy shall be zero (0).
“Defaulting Party” has the meaning set forth in Section 11.1(a). “Deficient Month” has the meaning set forth in Section 4.8(e). “Delay Damages” means Daily Delay Damages and Commercial Operation Delay Damages.
“Delivery Point” has the meaning set forth in Exhibit A.
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7 “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 (a) cash or (b) a Letter of Credit in the amount specified for the Development Security on the Cover Sheet.
“Disadvantaged Communities” or “DAC” has the meaning set forth in CPUC Decision 18-06-027 as communities that are defined in the CalEnviroScreen 4.0 (or any successor version) as among the top twenty-five percent (25%) of census tracts statewide, plus the census tracts in the highest five percent (5%) of CalEnviroScreen’s Pollution Burden that do not have an overall CalEnviroScreen score because of unreliable socioeconomic or health data. “Disclosing Party” has the meaning set forth in Section18.2. “Distribution Provider” has the meaning set forth in Exhibit A. “Early Termination Date” has the meaning set forth in Section 11.2(a). “Effective Date” has the meaning set forth on the Preamble. “Electrical Losses” means all transmission or transformation losses between the Facility and the Delivery Point associated with delivery of Facility Energy. “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. “Event of Default” has the meaning set forth in Section 11.1. “Excess MWh” has the meaning set forth in Exhibit C.
“Expected Commercial Operation Date” has the meaning set forth on the Cover Sheet. “Expected Construction Start Date” has the meaning set forth on the Cover Sheet. “Expected Energy” means the quantity of Energy that Seller expects to be able to deliver to Buyer from the Facility during each Contract Year, which for each Contract Year is the quantity specified on the Cover Sheet, which amount shall be adjusted proportionately to the reduction from Guaranteed Capacity to Installed Capacity pursuant to Section 5(a) of Exhibit B, if applicable.
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8 “Facility” means the solar photovoltaic generating facility described on the Cover Sheet and in Exhibit A, located at the Site and including mechanical equipment and associated facilities and equipment required to deliver Facility Energy to the Delivery Point. “Facility Energy” means the Energy during any Settlement Interval or Settlement Period, net of Electrical Losses and Station Use and, if accepted by the CAISO for settlement purposes, as adjusted to reflect Distribution Provider’s Real Power Loss Factor. Facility Energy shall be measured by the Facility Meter.
“Facility Meter” means the CAISO approved revenue quality meter or meters, CAISO approved data processing gateway or remote intelligence gateway, telemetering equipment and data acquisition services sufficient for monitoring, recording and reporting, in real time, all Facility Energy. Without limiting Seller’s obligation to deliver Facility Energy to the Delivery Point, the Facility Meter will be located, and Facility Energy will be measured, at the high voltage side of the main step-up transformer and will be subject to adjustment to measure Facility Energy at the Delivery Point in accordance with CAISO meter requirements and Prudent Operating Practices to account for Electrical Losses and, if accepted by the CAISO for settlement purposes, adjustments to reflect Distribution Provider’s Real Power Loss Factor. “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. “Financial Close” means Seller and/or one 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).
“Force Majeure Event” has the meaning set forth in Section 10.1. “Forced Facility Outage” means an unexpected failure of one or more components of the Facility that prevents Seller from generating Energy or making Facility Energy available at the Delivery Point and that is not the result of a Force Majeure Event. “Forecasted Product” has the meaning set forth in Section 4.3(b). “Forecasting Penalty” has the meaning set forth in Section 4.3(f). “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
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9 in determining the economic benefit to a Party may include, without limitation, reference to information supplied by one or more third parties, which shall exclude Affiliates of the Non-Defaulting Party, including without limitation, quotations (either firm or indicative) of relevant rates, prices, yields, yield curves, volatilities, spreads or other relevant market data in the relevant markets, comparable transactions, forward price curves based on economic analysis of the relevant markets, settlement prices for comparable transactions at liquid trading hubs (e.g., SP-15), all of which should be calculated for the remaining Contract Term, and include the value of Green Attributes.
“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 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 with the Facility that are applicable to a state or federal income taxation obligation, 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.
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10 “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 3.4, updated April 27, 2023, as may be further amended from time to time. “Guaranteed Capacity” means the generating capacity of the Facility, as measured in MW AC at the Delivery Point, that Seller commits to install pursuant to this Agreement 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 Construction Start 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. “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.
“Imbalance Reserves” has the meaning set forth in the CAISO Tariff. “Indemnified Party” has the meaning set forth in Section 16.1. “Indemnifying Party” has the meaning set forth in Section 16.1. “Initial Synchronization” means the commencement of Trial Operations (as defined in the CAISO Tariff).
“Installed Capacity” means the actual generating capacity of the Facility, as measured in MW AC at the Delivery Point (i.e., measured at the Facility Meter and adjusted for Electrical Losses and Real Power Loss Factor to the Delivery Point), that achieves Commercial Operation, as evidenced by a certificate substantially in the form attached as Exhibit H hereto. “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 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. “Interconnection Capacity Limit” means the maximum instantaneous amount of Energy that is permitted to be delivered to the Delivery Point under Seller’s Interconnection Agreement, in the amount of 2.46 MW.
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11 “Interconnection Facilities” means the interconnection facilities, control and protective devices and metering facilities required to connect the Facility with the Transmission System in accordance with the Interconnection Agreement.
“Interest Rate” has the meaning set forth in Section 8.2. “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.
“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, maintenance, 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, in a form substantially similar to the letter of credit set forth in Exhibit K with any modifications approved by the Buyer.
“Licensed Professional Engineer” means an independent, professional engineer selected by Seller and reasonably acceptable to Buyer, licensed in the State of California. “Locational Marginal Price” or “LMP” has the meaning set forth in the CAISO Tariff.
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12 “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, and Renewable Energy Incentives. For the avoidance of doubt, in the case of Seller as the Non-Defaulting Party, Losses shall include the value of any loss, recapture or inability to claim all or any portion of the Tax Credits associated with the Facility, determined on an after-tax basis, that are a direct or indirect result of a Buyer Event of Default and for which Seller was not capable of mitigating through the use of any reasonable efforts. Without limiting any of the foregoing, any Losses claimed by Party shall be actual, documented, and verifiable. “Lost Output” has the meaning set forth in Section 4.7. “Low-Income Community Bonus” has the meaning set forth in H.R. 5376 Section 13103. “Material Permits” means all permits required for Seller to commence construction, as set forth on Exhibit S.
“Milestones” means the significant permitting, interconnection, financing and construction milestones 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 Facility’s PNode is less than zero dollars ($0).
“NERC” means the North American Electric Reliability Corporation or any successor entity.
“Network Upgrades” has the meaning set forth in the CAISO Tariff. “Non-Defaulting Party” has the meaning set forth in Section 11.2.
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13 “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).
“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 Contract Year. “Performance Security” means (a) cash or (b) a Letter of Credit in the amount specified for the Development Security on the Cover Sheet.
“Permitted Transferee” means (a) any Affiliate of Seller or (b) any entity that satisfies, or is controlled by another Person that satisfies, the following requirements:
(i) A tangible net worth of not less than fifty million dollars ($50,000,000) or a Credit Rating of at least BBB- from S&P, BBB- from Fitch, or Baa3 from Moody’s; and (ii) At least two (2) years of experience in the ownership and operations of power generation facilities similar to the Facility, 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.
“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 Section 4.6(a).
“PNode” has the meaning set forth in the CAISO Tariff.
“Point of Receipt” is a term used in Distribution Provider’s Wholesale Distribution Access Tariff and means Delivery Point.
“Portfolio” means the single portfolio of electrical energy generating or other assets and entities, including the Facility (or the interests of Seller or Seller’s Affiliates or the interests of their respective direct or indirect parent companies), that is pledged as collateral security in connection with a Portfolio Financing.
“Portfolio Content Category” means PCC1, PCC2 or PCC3, as applicable. “Portfolio Content Category 1” or “PCC1” means any Renewable Energy Credit associated with the generation of electricity from an Eligible Renewable Energy Resource consisting of the portfolio content set forth in California Public Utilities Code Section 399.16(b)(1), as may be amended from time to time or as further defined or supplemented by Law.
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14 “Portfolio Content Category 2” or “PCC2” means any Renewable Energy Credit associated with the generation of electricity from an Eligible Renewable Energy Resource consisting of the portfolio content set forth in California Public Utilities Code Section 399.16(b)(2), as may be amended from time to time or as further defined or supplemented by Law. “Portfolio Content Category 3” or “PCC3” means any Renewable Energy Credit associated with the generation of electricity from an Eligible Renewable Energy Resource consisting of the portfolio content set forth in California Public Utilities Code Section 399.16(b)(3), as may be amended from time to time or as further defined or supplemented by Law. “Portfolio Financing” means any debt incurred by an Affiliate of Seller that is secured only by a Portfolio.
“Portfolio Financing Entity” means any Affiliate of Seller that incurs debt in connection with any Portfolio Financing.
“Product” has the meaning set forth on the Cover Sheet. “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 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 practices, reliability, safety and expedition. Prudent Operating Practice is not intended to be limited to the optimum practice, method or act to the exclusion of all others, but rather to acceptable practices, methods or acts generally accepted in the industry with respect to grid-interconnected, utility-scale generating facilities 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.
“Real Power Loss Factor” has the meaning set forth in Distribution Provider’s Wholesale Distribution Access Tariff (WDAT), or its equivalent, and is set, as of the Effective Date, as a
3.73% credit for the output at the Point of Receipt. If the Real Power Loss Factor is changed in the Distribution Provider’s FERC approved WDAT and the Facility Meter is reprogrammed to reflect a revised credit value, this Agreement will be amended to reflect such change.
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15 “Real Power Loss Factor Multiplier” means a value equal to one plus the Real Power Loss Factor percentage, or, as of the Effective Date, 1.0373. “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. “Receiving Party” has the meaning set forth in Section 18.2. “Recurring Certificate Transfers” has the meaning set forth in Section 4.8(a). “Reliability Network Upgrades” has the meaning set forth in the CAISO Tariff. “Remedial Action Plan” has the meaning set forth in Section 2.4. “Renewable Energy Credit” has the meaning set forth in California Public Utilities Code Section 399.12(h), as may be amended from time to time or as further defined or supplemented by Law.
“Renewable Energy Incentives” means: (a) all federal, state, or local Tax credits or other Tax benefits associated with the construction, ownership, or production of electricity from the 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 any attributes related to capacity markets including resource adequacy or any successor programs.
“Renewable Rate” has the meaning set forth on the Cover Sheet; provided, if the officer’s certificate provided by Seller pursuant to Section 2.2(k) states that Seller will claim a Tax Credit rate for the Facility that is higher than Seller’s assumed Tax Credit rate as set forth on the Cover Sheet, the Renewable Rate shall be reduced by (a) $ /MWh for each one (1) percentage point that the claimed ITC rate is above zero percent (0%) or (b) $ MWh for each $ /kWh that the PTC rate is above $ /kWh. By way of example, if Seller is able to obtain ITCs for 40% of the eligible basis of the Facility, then the rate shall be $ MWH. If Seller is able to obtain ITCs for 30% of the eligible basis of the Facility, then the rate shall be $ /MWH if Seller is not able to obtain such ITC the Renewable Rate remains $ /MWH. By way of example, if Seller is able to obtain PTCs for $ per kWh, then the rate shall be $ /MWh. “Replacement Energy” has the meaning set forth in Exhibit G. “Replacement Green Attributes” has the meaning set forth in Exhibit G.
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16 “Replacement Product” has the meaning set forth in Exhibit G. “Requested Confidential Information” has the meaning set forth in Section 18.2. “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 that clears under the applicable CAISO market based on the final Day-Ahead Schedule (as defined in the CAISO Tariff), 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.
“Scheduling Coordinator” or “SC” means an entity certified by the CAISO as qualifying as a Scheduling Coordinator pursuant to the CAISO Tariff for the purposes of undertaking the functions specified in “Responsibilities of a Scheduling Coordinator,” of the CAISO Tariff, as amended from time to time.
“Security Interest” has the meaning set forth in Section 8.9. “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.
“Site” means the real property on which the Facility is or will be located, as further described in Exhibit A, and as shall be updated by Seller at the time Seller provides an executed
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17 Construction Start Date certificate in the form of Exhibit J to Buyer; 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, for the Contract Term, Seller (or, prior to the Delivery Term, its Affiliate): (a) owns or has the option to purchase the Site; (b) is the lessee or has the option to lease the Site; or (c) is the holder of an easement or an option for an easement, right-of-way grant, or similar instrument with respect to the Site.
“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. “Supply Chain Code” has the meaning in Exhibit Q.
“System Emergency” means any condition that requires, as determined and declared by CAISO or the Transmission Provider, automatic or immediate action to (a) prevent or limit harm to or loss of life or property, (b) prevent loss of transmission facilities or generation supply in the immediate vicinity of the Facility, or (c) 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). “Test Energy” means Facility Energy delivered (a) commencing on the later of (i) the first date that the CAISO informs Seller in writing that Seller may deliver Energy to the CAISO and (ii) the first date that the Transmission Provider informs Seller in writing that Seller has conditional or temporary permission to operate in parallel with the CAISO Grid, and (b) ending upon the occurrence of the Commercial Operation Date.
“Test Energy Rate” has the meaning set forth in Section 3.6. “Transmission Provider” means any entity that owns, operates and maintains transmission or distribution lines and associated facilities and/or has entitlements to use certain
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18 transmission or distribution lines and associated facilities for the purpose of transmitting or transporting the Facility Energy from the Delivery Point. “Transmission System” means the transmission facilities operated by the CAISO, now or hereafter in existence, which provide energy transmission service downstream from the Delivery Point.
“Transmission System Outage” means an outage on the Transmission System, other than a System Emergency, that is not caused by Seller’s actions or inactions and that prevents Buyer or the CAISO (as applicable) from receiving Facility Energy onto the Transmission System. “Ultimate Parent” means Fillmore Sun Farms LLC, a California limited liability company.
“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.
1.2 Rules of Interpretation In this Agreement, except as expressly stated otherwise or unless the context otherwise requires:
(a) headings and the rendering of text in bold and italics are for convenience and reference purposes only and do not affect the meaning or interpretation of this Agreement; (b) words importing the singular include the plural and vice versa and the masculine, feminine and neuter genders include all genders; (c) the words “hereof”, “herein”, and “hereunder” and words of similar import shall refer to this Agreement as a whole and not to any particular provision of this Agreement; (d) a reference to an Article, Section, paragraph, clause, Party, or Exhibit is a reference to that 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,
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19 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 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) The term of this Agreement shall commence on the Effective Date and shall remain in full force and effect until the conclusion of the Delivery Term, subject to any early termination provisions 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.
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20 (b) Applicable provisions of this Agreement shall continue in effect after termination, including early termination, to the extent necessary to enforce or complete the duties, obligations or responsibilities of the Parties arising prior to termination. The confidentiality obligations of the Parties under Article 18 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. (c) Within one hundred eighty (180) days following Seller’s receipt of notification from Buyer that Seller was shortlisted by Buyer for negotiation of this Agreement, or such later timeframe as may be approved by the director of the CPUC Energy Division or his/her/their designee, Buyer will submit this Agreement to the CPUC via a Tier 2 advice letter seeking an order that, after issuance and the passage of time, would constitute a CPUC Approval (“Approval Application”). Seller agrees to cooperate with Buyer in preparing and filing the Approval Application and to actively support that application, as reasonably requested by Buyer.
If CPUC Approval of this Agreement is not obtained within one hundred eighty (180) days following the Effective Date, then either Party may terminate this Agreement upon written Notice to the other Party. Upon such termination, neither Party shall have any liability to the other Party, save and except for those obligations specified in Section 2.1, and Buyer shall promptly return to Seller any Development Security then held by Buyer, less any amounts drawn in accordance with this Agreement.
2.2 Conditions Precedent. 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 five (5) Business Days of the expected Commercial Operation 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:
(a) Seller shall have delivered to Buyer (i) a completion certificate from a Licensed Professional Engineer substantially in the form of Exhibit H; (b) A Participating Generator Agreement and a Meter Service Agreement between Seller and CAISO shall have been executed and delivered and be in full force and effect, and a copy of each such agreement delivered to Buyer;
(c) An Interconnection Agreement between Seller and the Transmission Provider shall have been executed and delivered and be in full force and effect and a copy of the Interconnection Agreement delivered to Buyer;
(d) All applicable regulatory authorizations, approvals and permits 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;
(e) Seller has received CEC Precertification of the Facility (and reasonably expects to receive final CEC Certification and Verification for the Facility in no more than one hundred eighty (180) days from the Commercial Operation Date); (f) Seller has obtained CAISO Certification for the Facility;
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21 (g) 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;
(h) Seller has delivered the Performance Security to Buyer in accordance with Section 8.8;
(i) Seller has taken all actions and executed all documents and instruments, required to authorize Buyer (or its designated agent) to act as Scheduling Coordinator under this Agreement and to fully enable the Facility to be Scheduled by Buyer, and Buyer (or its designated agent) is authorized to act as Scheduling Coordinator;
(j) Seller has delivered to Buyer an officer’s certificate stating (i) 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 (ii) the Tax Credit and applicable rate which Seller claims will apply for the Facility and/or Facility Energy; and (k) Seller has paid Buyer for all amounts owing under this Agreement, if any, including Delay Damages.
2.3 Development; Construction; Progress Reports.
(a) Within fifteen (15) days after the close of (i) each calendar quarter from the first calendar quarter following the Effective Date until the Construction Start Date, and (ii) each calendar month from the first calendar month following the Construction Start Date until the Commercial Operation Date, Seller shall provide to Buyer a Progress Report (both a clean version and a version redlined against the immediately prior 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 (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 consistent with Seller’s duty of good faith and fair dealing to (i) ensure that all materials, products and components used in constructing, installing and operating the Facility throughout the Term are in compliance with the Supply Chain Code of Conduct (Exhibit P), and (ii) include contract provisions materially similar to those set forth in the Supply Chain Code of Conduct in all contracts entered by it or its Affiliates for the construction, installation, and operation of the Facility. Seller shall notify Buyer as soon as it becomes aware of any breach, or potential breach, of its obligations under this Section
2.3(b).
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22 (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).
2.4 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, Seller shall submit to Buyer, within fifteen (15) 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 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; 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.
2.5 Low-Income Community Bonus. Seller shall make commercially reasonable efforts to qualify for and receive the Low-Income Community Bonus. Seller shall give Notice to Buyer within five (5) Business Days of Seller’s receipt of notice from any Governmental Authority regarding the outcome of Seller’s request or application to receive such Low-Income Community Bonus. Buyer shall use commercially reasonable efforts to provide information reasonably requested by Seller in support of Seller’s obligations pursuant to this Section 2.5.
ARTICLE 3
PURCHASE AND SALE
3.1 Purchase and Sale of Product. Subject to the terms and conditions of this Agreement, during the Delivery Term, Buyer shall purchase all the Product produced by or associated with the Facility at the Renewable 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. At its sole discretion, Buyer may during the Delivery Term re-sell or use for another purpose all or a portion of the Product; provided, 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.
3.2 Sale of Green Attributes. During the Delivery Term, Seller shall sell and deliver to Buyer, and Buyer shall purchase from Seller, all Green Attributes attributable to the Facility Energy. 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.
3.3 Imbalance Energy. Buyer and Seller recognize that in any given Settlement Period the amount of Facility Energy may deviate from the amounts thereof scheduled with the CAISO.
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23 Following CAISO Commercial Operation, to the extent there are such deviations, any costs, liabilities or revenues from such imbalances shall be solely for the account of Buyer, except as expressly set forth in this Agreement.
3.4 Ownership of Renewable Energy Incentives. Seller shall have all right, title and interest in and to all Renewable Energy Incentives. Buyer acknowledges that any Renewable Energy Incentives belong to Seller. If any Renewable Energy Incentives, or values representing the same, are initially credited or paid to Buyer, Buyer shall cause such Renewable Energy Incentives or values relating to same to be assigned or transferred to Seller without delay. Buyer shall reasonably cooperate with Seller, at Seller’s sole expense, in Seller’s efforts to meet the requirements for any certification, registration, or reporting program relating to Renewable Energy Incentives.
3.5 Future Environmental Attributes.
(a) The Parties acknowledge and agree that as of the Effective Date, environmental attributes sold under this Agreement are restricted to Green Attributes; however, Future Environmental Attributes may be created by a Governmental Authority through Laws enacted after the Effective Date. Subject to the final sentence of this Section 3.5(a) and 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 Renewable 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.
3.6 Test Energy. No less than fourteen (14) days prior to the first day on which Test Energy is expected to be available from the Facility, Seller shall notify Buyer of the availability of the Test Energy. If and to the extent the Facility generates Test Energy, Seller shall sell and Buyer shall purchase from Seller all Test Energy and any associated Products on an as-available basis for up to one hundred eighty (180 days) from the first delivery of Test Energy. As compensation for such Test Energy and associated Product, Buyer shall pay Seller an amount equal to seventy percent (70%) of the Renewable Rate, and thereafter zero dollars ($0) per MWh (the “Test Energy Rate”). The conditions precedent in Section 2.2 are not applicable to the Parties’ obligations under this Section 3.6.
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24 3.7 CEC Certification and Verification. Subject to Section 3.10 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 throughout the Delivery Term, 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 CEC Precertification by the Commercial Operation Date. Within thirty (30) days after the Commercial Operation Date, Seller shall apply with the CEC for final CEC Certification and Verification. Within one hundred eighty (180) days after the Commercial Operation Date, Seller shall obtain and maintain throughout the remainder of the Delivery Term the final CEC Certification and Verification which deadline shall be extended on a day-for-day basis if there is any delay in CEC Certification and Verification and such delay is caused by any reason other than an act of omission of Seller, as reasonably demonstrated to Buyer. 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.
3.8 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]
3.9 California Renewables Portfolio Standard. Subject to Section 3.10, 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.
3.10 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 that are made subject to this Section 3.10, including with respect to obtaining, maintaining, conveying or effectuating Buyer’s use of Green Attributes, 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,
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25 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 3.10 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 Compliance Actions, not to exceed the Accepted Compliance Costs, within sixty (60) days from the time that Buyer receives an invoice and documentation of such costs from Seller.
3.11 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; 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 as set forth in a written agreement.
ARTICLE 4
OBLIGATIONS AND DELIVERIES
4.1 Delivery.
(a) Energy. Subject to the provisions of this Agreement, commencing on the Commercial Operation Date through the end of the Contract Term, Seller shall supply and deliver the Product to Buyer at the Delivery Point, and Buyer shall take delivery of the Product at the Delivery Point in accordance with the terms of this Agreement. Seller shall be responsible for paying or satisfying when due any costs or charges imposed in connection with the delivery of Facility Energy to the Delivery Point, including 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 and imbalance charges. The Facility Energy will be scheduled with the CAISO by Buyer (or Buyer’s designated Scheduling Coordinator) in accordance with Exhibit D.
(b) Green Attributes. All Green Attributes associated with Test Energy and the Facility Energy during the Delivery Term are exclusively dedicated to and vested in Buyer. Seller represents and warrants that Seller holds the rights to all Green Attributes from the Facility, and Seller agrees to convey and hereby conveys all such Green Attributes to Buyer as included in the delivery of the Product from the Facility.
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26 (c) Energy Products. If, at any time during the Contract Term, Buyer requests Seller to provide any new or different Energy-related products or Ancillary Services (as defined in the CAISO Tariff) 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 or liabilities) on Seller or the Facility or Seller’s obligations or liabilities under this Agreement, then Seller shall use commercially reasonable efforts to 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 or liabilities) on Seller or the Facility or Seller’s obligations or liabilities under this 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.
4.3 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).
(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 beginning of each calendar year for every subsequent Contract Year during the Delivery Term, Seller shall provide to Buyer and the SC (if applicable) a non-binding forecast of each month’s average-day expected 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 ten (10) Business Days before the beginning of each month during the Delivery Term, Seller shall provide to Buyer and the SC (if applicable) a non-binding forecast of the hourly expected (i) available capacity of the Facility and (ii) Facility Energy (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. By 5:30 AM Pacific Prevailing Time on the Business Day immediately preceding the date of delivery, or as otherwise specified by Buyer consistent with Prudent Operating Practice, Seller shall provide Buyer with a non-binding forecast of the hourly expected Forecasted Product, in each case, for each hour of the immediately succeeding day (“Day-Ahead Forecast”). A Day-Ahead Forecast provided in a day prior to any non-Business
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27 Day(s) shall include non-binding forecasts for the immediate day, each succeeding non-Business Day, and the next Business Day. Each Day-Ahead Forecast shall clearly identify, for each hour, Seller’s best estimate of the hourly expected Forecasted Product. Such Day-Ahead Forecasts shall be sent to Buyer’s on-duty Scheduling Coordinator. If Seller fails to provide Buyer with a Day-Ahead Forecast as required herein for any period, then for such unscheduled delivery period only, Buyer shall rely on any Real-Time Forecast or the Monthly Forecast or Buyer’s best estimate based on information reasonably available to Buyer.
(d) Real-Time Forecasts. During the Delivery Term, Seller shall notify Buyer of any changes from the Day-Ahead Forecast of one (1) MW / one (1) MWh or more in the hourly expected Forecasted Product (“Real-Time Forecast”), in each case, whether due to a Forced Facility Outage, Force Majeure Event or other cause, as soon as reasonably possible, but no later than one (1) hour prior to the deadline for submitting schedules to the CAISO in accordance with the rules for participation in the Real-Time Market. If the Forecasted Product changes by at least one (1) MW as of a time that is less than one (1) hour prior to the Real-Time Market deadline, but before such deadline, then Seller must notify Buyer as soon as reasonably possible. Such Real-Time Forecasts of Facility Energy shall be provided by an Approved Forecast Vendor and shall contain information regarding the beginning date and time of the event resulting in the change in any Forecasted Product, as applicable, the expected end date and time of such event, and any other information required by the CAISO or reasonably requested by Buyer. With respect to any Forced Facility Outage, Seller shall use commercially reasonable efforts to notify Buyer of such outage within ten (10) minutes of the commencement of the Forced Facility Outage. Seller shall inform Buyer of any developments that 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 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) Forced Facility Outages. Notwithstanding anything to the contrary herein, Seller shall promptly notify Buyer’s on-duty Scheduling Coordinator of Forced Facility Outages and Seller shall keep Buyer informed of any developments that will affect either the duration of the outage or the availability of the Facility during or after the end of the outage. (f) Forecasting Penalties. In the event Seller does not in a given hour provide the forecast required in Section 4.3(d) and Buyer incurs a loss or penalty resulting from its scheduling activities with respect to Facility Energy during such hour, Seller shall be responsible for a “Forecasting Penalty” for each such hour equal to the product of (A) the absolute difference (if any) between (i) the expected Facility Energy for such hour set forth in the Day Ahead Forecast, and (ii) the actual Facility Energy, multiplied by (B) the absolute value of the Real-Time Price in such hour. Settlement of Forecasting Penalties shall occur as set forth in Article 8 of this Agreement.
(g) CAISO Tariff Requirements. Seller shall comply with all applicable obligations for Variable Energy Resources under the CAISO Tariff and the Eligible Intermittent Resource Protocol, including providing appropriate operational data and meteorological data, and
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28 will fully cooperate with Buyer, Buyer’s SC, and CAISO, in providing all data, information, and authorizations required thereunder.
4.4 Dispatch Down/Curtailment.
(a) General. 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, Buyer Curtailment Order, or notice received from CAISO in respect of a Buyer Bid Curtailment. (b) Buyer Curtailment. Buyer shall have the right to order Seller to curtail deliveries of Facility Energy through Buyer Curtailment Orders; provided, Buyer shall pay Seller for all Deemed Delivered Energy associated with a Buyer Curtailment Period at the Renewable Rate.
(c) Failure to Comply. If Seller fails to comply with a Buyer Curtailment Order, Buyer Bid Curtailment or Curtailment Order, then, for each MWh of Facility Energy that is delivered by the Facility to the Delivery Point that is in excess of the Buyer Curtailment Order, Buyer Bid Curtailment or Curtailment Order, Seller shall pay Buyer for each such MWh at an amount equal to the sum of (A) + (B) + (C), where: (A) is the amount, if any, paid to Seller by Buyer for delivery of such excess MWh, (B) is the sum, for all Settlement Intervals with a Negative LMP during the Buyer Curtailment Period or Curtailment Period, of the absolute value of the product of such excess MWh in each Settlement Interval and the Negative LMP for such Settlement Interval, and (C) is any penalties assessed by the CAISO or other charges assessed by the CAISO resulting from Seller’s failure to comply with the Buyer Curtailment Order, Buyer Bid Curtailment or Curtailment Order.
(d) Seller Equipment Required for Operating Instruction Communications.
Seller shall acquire, install, and maintain such facilities, communications links and other equipment, and implement such protocols and practices, as necessary to respond to and follow operating instructions from the CAISO and Buyer's SC, including an electronic signal conveying real time and intra-day instructions, to operate the Facility as directed by Buyer from time to time in accordance with this Agreement and/or a Governmental Authority, including to implement a Buyer Curtailment Order, Buyer Bid Curtailment or Curtailment Order in accordance with the methodologies applicable to the Facility and used to transmit such instructions. If at any time during the Delivery Term, Seller’s facilities, communications links or other equipment, protocols or practices are not in compliance with methodologies applicable to the Facility and directed by Buyer, Seller shall take the steps necessary to become compliant as soon as commercially reasonably possible. Seller shall be liable pursuant to Section 4.4(c) for failure to comply with a Buyer Curtailment Order, Buyer Bid Curtailment or Curtailment Order, during the time that Seller’s facilities, communications links or other equipment, protocols or practices are not in compliance with applicable methodologies. A Buyer Curtailment Order, Buyer Bid Curtailment or Curtailment Order communication via such systems and facilities shall have the same force and effect on Seller as any other form of communication.