DATE: July 9, 2025
MEETING DATE: July 24, 2025
VOTE REQUIRED: Majority Vote
TO: Honorable Peninsula Clean Energy Authority Board of Directors FROM: Shawn Marshall, Chief Executive Officer; Roy Xu, Senior Director of Power Resources; Mehdi Shahriari, Senior Manager of Planning and Analytics SUBJECT: Approval of a Resolution Delegating Authority to the Chief Executive Officer to Execute Two Power Purchase Agreements for the IP Darden III and IP Darden IV Solar Plus Storage Projects with IP Darden III, LLC and IP Darden IV, LLC with a Delivery Term of Up to Twelve (12) Years and a Commercial Operation Date of June 1, 2028, in a Total Amount Not-to-Exceed $333 Million (Action) Item No. 10
PENINSULA CLEAN ENERGY AUTHORITY
JPA Board Correspondence
RECOMMENDATION
Approve Resolution Delegating Authority to the Chief Executive Officer to Execute two Power Purchase Agreements for the IP Darden III and IP Darden IV Solar Plus Storage Projects with IP Darden III, LLC and IP Darden IV, LLC with a Delivery Term of Up to Twelve (12) Years and a Commercial Operation Date of June 1, 2028, in a Total Amount Not-to-Exceed $333 Million (Action)
BACKGROUND
Peninsula Clean Energy's Board has set a long-term goal to procure 100% of its energy supply from renewable energy sources by 2030 through strategic and cost-effective procurement of resources that maximize 24/7 hourly matching of renewable energy and load.
Solar photovoltaics (solar) plus storage is one of the best value resource types to meet this ambitious goal, allowing Peninsula Clean Energy to procure low-cost renewable solar energy, and store the energy in the battery to use it when it is needed most. The IP Darden project would be the fourth solar project paired with energy storage in Peninsula Clean Energy's portfolio.
Given the recently adopted federal legislation that will phase out tax credits for wind and solar projects, the IP Darden project is a rare project that is on track to come online in the near-term and qualify for tax credits. Projects with later CODs will likely no longer qualify for tax credits and will be significantly more expensive to procure. Additionally, the IP Darden project qualifies for two additional "bonus" tax credits of 10% each. The IP Darden project will use domestically-sourced materials, including solar panels, steel, and aluminum, allowing it to qualify for the Domestic Content "bonus" tax credit adder. And, the IP Darden project is being developed in an area that previously had a significant fossil fuel industry, allowing the project to qualify for the Energy Community "bonus" adder. The IP Darden project was a competitively priced project prior to the passage of the recent federal legislation, and is now one of the best-positioned projects for not only remaining eligible for tax credits but qualifying for the "bonus" tax credits.
Developer Background
Intersect Power is a clean energy company that develops, owns and operates some of the largest clean energy resources in the country. Intersect Power has a base portfolio of 2.2 GW of operating solar and 2.4 GWh of battery storage in operation or construction, including over 700 MW of solar and almost 1.5 GWh of storage within CAISO.
Intersect Power is funded by investments from TPG Rise Climate, Climate Adaptive Infrastructure, and Greenbelt Capital Partners, with plans to raise additional equity to develop large scale renewable projects.
Overview of the Project
Project Names
IP Darden III
IP Darden IV
Technology
Solar Photovoltaic
Co-located Lithium-Ion Storage
Combined Capacity (Peninsula
Clean Energy's Share)
84.56 MW Solar
83.68 MW / 334.72 MWh Storage (4-hour)
with the option to increase to:
91.48 MW / 365.92 MWh Storage (4-hour)
Commercial Operation Date June 1, 2028
Project Owner
IP Darden III, LLC
IP Darden IV, LLC
Developer
Intersect Power
Location Fresno County
The IP Darden solar plus storage project is a new, 1,150 MW solar plus 1,150 MW / 4,600 MWh (4-hour duration) storage project located in Fresno County. The storage portion of the project is currently the largest single storage project under development in the world.
Peninsula Clean Energy is contracting for an approximately 7% portion of the larger project under two agreements, or a total of 84.56 MW (85 MW) of solar PV co-located with 83.68 MW / 334.72 MWh (4-hour duration) (84 MW) of lithium-ion storage, and with an option to increase the storage capacity to 91.48 MW / 365.92 MWh (4-hour duration) (91MW) .
Given the large size of the overall IP Darden project, Intersect has structured the project into four separate legal entities: IP Darden I through IV, LLC, each representing a quarter of the project capacity. The four-way structuring allows the project to tailor financing approaches for lenders, and allows for phased construction and interconnection schedules. The four-way structure also facilities contracting the project with multiple offtakers, including Peninsula Clean Energy. The project has been structured to insulate each offtaker from cross-default exposure to other offtakers. Peninsula Clean Energy recently engaged with Intersect in discussions around the IP Darden project, and IP Darden was able to offer Peninsula Clean Energy portions of the project that remained from IP Darden III, as well as a remaining portion of IP Darden IV. Because PCE will be contracting for portions that remain in both the IP Darden III and IP Darden IV projects, two separate Power Purchase Agreements are necessary. Both PPAs will contain identical terms and conditions, except for the names of the projects (IP Darden III versus IP Darden IV) and the associated project companies.
Peninsula Clean Energy will contract for its portion of the IP Darden project under two separate but identical Power Purchase Agreements with IP Darden III and IP Darden IV. The contracts will be for a ten (10) year term, with an option for Intersect to extend for an additional two (2) years with no change in price, as long as the seller opts to extend by November 2025.
Under the two contracts, Peninsula Clean Energy will pay for the output of the 85 MW solar project at a fixed dollar per MWh rate, and will pay for the 84 MW (or up to 91MW) of storage capacity at a fixed-price dollars per kw-month rate. Both rates will have no escalation for the entire term of the contract, regardless of whether Intersect extends the contract for additional two years. Under the contract, Peninsula Clean Energy is entitled to all products from the facility, including renewable energy, storage capacity (charging and discharging energy), ancillary services, and resource adequacy.
The expected Commercial Operation Date is June 1, 2028. The project currently has Full Capacity Delivery Status from the CAISO, which will allow the project to provide resource adequacy attributes to Peninsula Clean Energy. The project will interconnect to the grid via a new switching station looping into the existing 500 kV Los Banos to Midway #2 transmission line. The project has already started construction under current IRS tax credit rules, and is on track to maintain qualification for start of construction even under anticipated future changes to start of construction rules.
The project will help Peninsula Clean Energy meet its ambitious 2030 goal of 100% renewable energy. The project is not currently needed for the CPUC's Mid-Term Reliability procurement order, but if additional CPUC procurement orders are issued, the IP Darden project is positioned for the best chance of contributing to those potential future procurement orders.
Staff is requesting that the Board authorize the CEO to finalize negotiation of the IP Darden PPAs, consistent with the major terms presented in this memo and at the July 2025 Board Meeting. Staff will provide an informational update during the September 2025 Board Meeting to update the Board on the status of the execution of the agreements.
Workforce Requirements and Community Benefits
Intersect has agreed that the construction of the project will be conducted using a project labor agreement or other similar agreement providing for terms and conditions of employment with applicable labor organizations. The construction phase of the entire Darden project is expected to generate up to 350 jobs per year, with approximately 25 jobs associated with Peninsula Clean Energy's portion. During the post-construction phase there will be up to 40 full-time and part-time jobs per year over the Project's lifetime, including 15 permanent positions. Peninsula Clean Energy's portion of the project will generate about 3 direct and in-direct operations jobs, including 1 permanent position.
The project includes a community benefits plan that commits Intersect Power to invest more than $2 million over the next decade in community-based initiatives and programs in Fresno County, approximately $140,000 of which would be associated with Peninsula Clean Energy's portion of the project.
Environmental Review
The project will be built on 9,500 acres of land in western Fresno County that is no longer able to support agricultural production. The project is the first project to be permitted under California's Opt-In Certification Program, which allows the California Energy Commission (CEC) to oversee the permitting of clean and renewable energy facilities. The project permitting was approved by the CEC on June 11, 2025, and includes all state and local permits (e.g. CEQA, Incidental Take Permit, Building and Gradit Permits). A land use authorization from the US Bureau of Reclamations is expected to be approved in October 2025, and an encroachment permit from CalTrans is expected in March 2026.
Peninsula Clean Energy staff performs an internal environmental review of each potential new project. Staff evaluated the IP Darden project and found that the IP Darden project was not located in a protected area based on the USGS Protected Areas Database.
Battery Safety
Peninsula Clean Energy and Intersect Power place safety of the lithium-ion storage components at the highest priority. The battery will be built in accordance with a lithium-ion battery storage specific safety plan set by the most current safety standards. The plan will be in compliance with the National Fire Protection Agency Standard 855 (NFPA 855). The project safety plan will be approved by the Fresno County Fire Protection District. The batteries will be installed in stationary modular containers specifically designed to house batteries, which is the current industry standard for safety and fire suppression. The battery chemistry will use Lithium Iron Phosphate (LFP) which is the current industry standard for utility-scale lithium batteries and is known for its safety and resistance to thermal runaway.
DISCUSSION
Priority 1 of Peninsula Clean Energy's Strategic Plan is to: Deliver 100% renewable energy on an annual basis by 2030 through strategic and cost-effective procurement of resources that maximize Peninsula Clean Energy's 24/7 hourly matching of renewable energy and load.
Solar plus storage is one of the best value resource types to meet this ambitious goal, allowing Peninsula Clean Energy to procure low-cost renewable solar energy, and store the energy in the battery to use it when it is needed most.
The IP Darden project was a competitive project prior to the passage of the recent federal legislation, and is now one of the best-positioned projects to come online and contribute to Peninsula Clean Energy's clean energy goals, while remaining cost-effective.
FISCAL IMPACT
The fiscal impact of the IP Darden solar plus storage project will not exceed $333 million over the term of the Agreement commencing on or around June 1, 2028.
STRATEGIC PLAN
The IP Darden solar plus storage project supports the following objectives in Peninsula Clean Energy's strategic plan:
Priority 1: Deliver 100% renewable energy on an annual basis by 2030 through strategic and cost-effective procurement of resources that maximize 24/7 hourly matching of renewable energy and load.
Power Resources Goal 1: Secure sufficient, low-cost, clean sources of electricity that achieve Peninsula Clean Energy's priorities while ensuring reliability and meeting regulatory mandates.
RESOLUTION NO. _____________
PENINSULA CLEAN ENERGY AUTHORITY, COUNTY OF SAN MATEO, STATE OF
CALIFORNIA
APPROVAL OF A RESOLUTION DELEGATING AUTHORITY TO THE CHIEF EXECUTIVE
OFFICER TO EXECUTE TWO POWER PURCHASE AGREEMENTS FOR THE IP DARDEN
III AND IP DARDEN IV SOLAR PLUS STORAGE PROJECTS WITH IP DARDEN III, LLC AND IP DARDEN IV, LLC WITH A DELIVERY TERM OF UP TO TWELVE (12) YEARS AND A COMMERCIAL OPERATION DATE OF JUNE 1, 2028, IN A TOTAL AMOUNT NOT-TO-EXCEED $333 MILLION (ACTION) RESOLVED, by the Peninsula Clean Energy Authority of the County of San Mateo, State of California, that
WHEREAS, the Peninsula Clean Energy Authority (“Peninsula Clean Energy”) was formed on February 29, 2016; and
WHEREAS, Peninsula Clean Energy is purchasing energy, renewable energy, carbon-free energy, and related products and services (the “Products”) to supply its customers; and WHEREAS, Peninsula Clean Energy has engaged in negotiations for the IP Darden III and IP Darden IV solar plus storage projects, to be located in Fresno County; and WHEREAS, Peninsula Clean Energy seeks to execute two Power Purchase Agreements (PPAs) to procure 85 MW of solar photovoltaic plus up to 91 MW / 364 MWh (4-hour duration) lithium-ion storage capacity and related products from the IP Darden III and IP Darden IV solar plus storage projects, based on the projects' desirable attributes, pricing, and terms; and WHEREAS, the Board delegates authority to the Chief Executive Officer to execute two Agreements in a total amount not to exceed $333 million to purchase renewable solar energy and co-located storage capacity and related products from IP Darden III, LLC and IP Darden IV, LLC; and
WHEREAS, the Board’s authorization to the Chief Executive Officer to execute the Agreements is contingent on the agreement of IP Darden III, LLC and IP Darden IV, LLC to terms consistent with those presented to the Board.
NOW, THEREFORE, IT IS HEREBY DETERMINED AND ORDERED that the Board delegates authority to the Chief Executive Officer to execute two Agreements with IP Darden III, LLC and IP Darden IV, LLC inclusive of terms consistent with those presented, in a form approved by the General Counsel and for a delivery term of up to twelve (12) years, in a total amount not to exceed $333 million.
Version as of July 23, 2025
POWER PURCHASE AND SALE AGREEMENT
COVER SHEET
Seller: IP Darden III, LLC, a Delaware limited liability company Buyer: Peninsula Clean Energy Authority, a California joint powers authority Description of Generating Facility and Storage Facility: A separately metered 42.28 MW solar photovoltaic electric generating facility located in Fresno County, California, plus a separately metered 167.36 MWh and 41.84 MW AC energy storage facility with at least four (4) hours of continuous discharging at the maximum rate of discharge, located at the same Site as the Generating Facility in Fresno County, California.
Guaranteed Commercial Operation Date: June 1, 2028
Milestones:
Milestone Expected Completion Date
Site Control Complete
Conditional Use Permit Complete
Phase II Interconnection Study Results Complete
Obtain Full Capacity Deliverability Status Allocation Complete Executed Interconnection Agreement Complete
Procure Major Equipment Complete
Financial Close 3/1/2026
Construction Start 6/1/2027
Initial Synchronization 1/1/2028
Deliverability Network Upgrades completed Complete
CAISO Commercial Operation 5/1/2028
Commercial Operation Date 6/1/2028
Delivery Term: 10 Contract Years; provided, Seller shall have the right, upon delivery of Notice to Buyer on or before November 30, 2025, to increase the Delivery Term to twelve (12) Contract Years.
Delivery Term Expected Energy:
Contract Year Expected Energy (MWh)
1 2
3 4
5 6
7 8
9 10
11 [If Applicable]
12 [If Applicable]
Monthly Expected Energy:
1 Month Expected Energy (MWh)
January
1 This table reflects Seller’s Expected Energy by calendar month in the first Contract Year, as if the first Contract Year begins on January first. The first Contract Year may begin on another date, per the terms of this Agreement.
Month Expected Energy (MWh)
February
March
April
May
June
July
August
September
October
November
December
Guaranteed Storage Capacity:
Contract Years Storage Rate ($/kW-month)
All
Guaranteed Storage Availability:
Product:
x PV Energy
x Discharging Energy
x Green Attributes: Portfolio Content Category 1
x Future Environmental Attributes
x Capacity Attributes
x Storage Product
Scheduling Coordinator: Seller prior to Commercial Operation; Buyer or Buyer’s agent following Commercial Operation.
Development Security: $105/kW of Guaranteed PV Capacity and Guaranteed Storage Capacity.
Performance Security: $105/kW of Installed PV Capacity and Installed Storage Capacity. [Signatures on following page.]
IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed as of the Effective Date.
SELLER
IP Darden III, LLC
By:
Name:
Title:
BUYER
Peninsula Clean Energy Authority
By:
PCE Executive Officer
i
TABLE OF CONTENTS
Page
ARTICLE 1 DEFINITIONS........................................................................................................ 1
1.1 Contract Definitions................................................................................................ 1
1.2 Rules of Interpretation .......................................................................................... 23 ARTICLE 2 TERM; CONDITIONS PRECEDENT............................................................... 25
2.1 Contract Term....................................................................................................... 25
2.2 Conditions Precedent ............................................................................................ 26
2.3 Development; Construction; Progress Reports..................................................... 28
2.4 Remedial Action Plan ........................................................................................... 28
2.5 Facility Configuration........................................................................................... 28 ARTICLE 3 PURCHASE AND SALE ..................................................................................... 29
3.1 Sale of Product...................................................................................................... 29
3.2 Sale of Green Attributes........................................................................................ 30
3.3 Compensation ....................................................................................................... 30
3.4 Imbalance Energy ................................................................................................. 31
3.5 Ownership of Renewable Energy Incentives........................................................ 31
3.6 Future Environmental Attributes .......................................................................... 31
3.7 Test Energy ........................................................................................................... 32
3.8 Capacity Attributes ............................................................................................... 32
3.9 Resource Adequacy Failure .................................................................................. 33
3.10 CEC Certification and Verification ...................................................................... 34
3.11 Eligibility .............................................................................................................. 34
3.12 California Renewables Portfolio Standard............................................................ 35
3.13 Compliance Expenditure Cap ............................................................................... 35 Guaranteed Interconnection Capacity................................................................... 36
3.15 CPUC Mid-Term Reliability Requirements ......................................................... 36
3.16 Buyer’s Re-Sale of Product .................................................................................. 36 ARTICLE 4 OBLIGATIONS AND DELIVERIES................................................................. 37
4.1 Delivery................................................................................................................. 37
4.2 Title and Risk of Loss........................................................................................... 37
4.3 Scheduling Coordinator Responsibilities.............................................................. 37
4.4 Forecasting............................................................................................................ 39
4.5 Dispatch Down/Curtailment ................................................................................. 40
4.6 Charging and Discharging Energy........................................................................ 42
4.7 Reduction in Delivery Obligation......................................................................... 44
4.8 Expected Energy and Guaranteed Energy Production.......................................... 44
4.9 WREGIS ............................................................................................................... 45
4.10 Financial Statements............................................................................................. 46
4.11 Access to Data....................................................................................................... 46
4.12 Storage Availability and Efficiency...................................................................... 49 ii
4.13 Storage Capacity Tests.......................................................................................... 49
4.14 Storage Facility Modifications.............................................................................. 49
4.15 Ancillary Services................................................................................................. 50
4.16 Workforce Agreement .......................................................................................... 50
4.17 Diverse Business Enterprises. During the Delivery Term, n................................ 50
4.18 Shared Facilities.................................................................................................... 51 ARTICLE 5 TAXES................................................................................................................... 51
5.1 Allocation of Taxes and Charges.......................................................................... 51
5.2 Cooperation........................................................................................................... 51
5.3 Ownership............................................................................................................. 52 ARTICLE 6 MAINTENANCE OF THE FACILITY ............................................................. 52
6.1 Maintenance of the Facility .................................................................................. 52
6.2 Maintenance of Health and Safety........................................................................ 53
6.3 Permits and Approvals.......................................................................................... 53
6.4 Energy to Serve Station Use ................................................................................. 53 ARTICLE 7 METERING.......................................................................................................... 54
7.1 Metering................................................................................................................ 54
7.2 Meter Verification................................................................................................. 55 ARTICLE 8 INVOICING AND PAYMENT; CREDIT......................................................... 55
8.1 Invoicing ............................................................................................................... 55
8.2 Payment................................................................................................................. 55
8.3 Books and Records ............................................................................................... 56
8.4 Payment Adjustments; Billing Errors................................................................... 56
8.5 Billing Disputes .................................................................................................... 56
8.6 Netting of Payments.............................................................................................. 57
8.7 Seller’s Development Security ............................................................................. 57
8.8 Seller’s Performance Security............................................................................... 57
8.9 First Priority Security Interest in Cash or Cash Equivalent Collateral ................. 57 ARTICLE 9 NOTICES .............................................................................................................. 58
9.1 Addresses for the Delivery of Notices.................................................................. 58
9.2 Acceptable Means of Delivering Notice............................................................... 58 ARTICLE 10 FORCE MAJEURE............................................................................................ 59
10.1 Definition .............................................................................................................. 59
10.2 No Liability If a Force Majeure Event Occurs ..................................................... 60
10.3 Notice.................................................................................................................... 60
10.4 Termination Following Force Majeure Event....................................................... 60 iii
ARTICLE 11 DEFAULTS; REMEDIES; TERMINATION ................................................. 60
11.1 Events of Default .................................................................................................. 60
11.2 Remedies; Declaration of Early Termination Date............................................... 63
11.3 Damage Payment; Termination Payment ............................................................. 64
11.4 Notice of Payment of Termination Payment ........................................................ 65
11.5 Disputes With Respect to Termination Payment.................................................. 65
11.6 Limitation on Seller’s Ability to Make or Agree to Third-Party Sales from the Facility after Early Termination Date ............................................................. 65
11.7 Rights And Remedies Are Cumulative................................................................. 65
11.8 Mitigation.............................................................................................................. 66 ARTICLE 12 LIMITATION OF LIABILITY AND EXCLUSION OF
WARRANTIES............................................................................................. 66
12.1 No Consequential Damages.................................................................................. 66
12.2 Waiver and Exclusion of Other Damages............................................................. 66 ARTICLE 13 REPRESENTATIONS AND WARRANTIES; AUTHORITY...................... 67
13.1 Seller’s Representations and Warranties .............................................................. 67
13.2 Buyer’s Representations and Warranties.............................................................. 68
13.3 General Covenants................................................................................................ 68 ARTICLE 14 ASSIGNMENT ................................................................................................... 69
14.1 General Prohibition on Assignments.................................................................... 69
14.2 Permitted Assignment; Change of Control of Seller ............................................ 69
14.3 Permitted Assignment; Change of Control of Buyer............................................ 69
14.4 Buyer Financing Assignment................................................................................ 69 ARTICLE 15 LENDER ACCOMMODATIONS.................................................................... 70
15.1 Granting of Lender Interest................................................................................... 70
15.2 Rights of Lender ................................................................................................... 70
15.3 Cure Rights of Lender........................................................................................... 71 ARTICLE 16 DISPUTE RESOLUTION ................................................................................. 71
16.1 Governing Law ..................................................................................................... 71
16.2 Dispute Resolution................................................................................................ 71
16.3 Attorneys’ Fees..................................................................................................... 71
16.4 Venue .................................................................................................................... 71 ARTICLE 17 INDEMNIFICATION........................................................................................ 72
17.1 Indemnification..................................................................................................... 72
17.2 Claims................................................................................................................... 72 iv
ARTICLE 18 INSURANCE....................................................................................................... 72
18.1 Insurance ............................................................................................................... 72 ARTICLE 19 CONFIDENTIAL INFORMATION ................................................................ 73
19.1 Definition of Confidential Information................................................................. 73
19.2 Duty to Maintain Confidentiality.......................................................................... 74
19.3 Irreparable Injury; Remedies ................................................................................ 74
19.4 Disclosure to Lender............................................................................................. 74
19.5 Disclosure to Credit Rating Agency ..................................................................... 74
19.6 Public Statements.................................................................................................. 75 ARTICLE 20 MISCELLANEOUS ........................................................................................... 75
20.1 Entire Agreement; Integration; Exhibits............................................................... 75
20.2 Amendments......................................................................................................... 75
20.3 Time is of the Essence. ......................................................................................... 75
20.4 No Waiver............................................................................................................. 75
20.5 No Agency, Partnership, Joint Venture or Lease.................................................. 75
20.6 Severability ........................................................................................................... 75
20.7 Mobile-Sierra ........................................................................................................ 75
20.8 Counterparts.......................................................................................................... 76
20.9 Facsimile or Electronic Delivery .......................................................................... 76
20.10 Binding Effect....................................................................................................... 76
20.11 No Recourse to Members of Buyer ...................................................................... 76
20.12 Change in Electric Market Design........................................................................ 76 ARTICLE 21 CPUC MODIFIABLE STANDARD CONTRACT TERMS.......................... 77
21.1 STC 2: Bioenergy Transactions............................................................................ 77
21.2 STC 4: Confidentiality.......................................................................................... 77
21.3 STC 5: Contract Term........................................................................................... 78
21.4 STC 7: Performance Standards/Requirements...................................................... 79
21.5 STC 8: Product Definitions................................................................................... 82
21.6 STC 9: Non-Performance or Termination Penalties and Default Provisions....... 82
21.7 STC 12: Credit Terms........................................................................................... 87
21.8 STC 15: Contract Modifications........................................................................... 93
21.9 STC 16: Assignment............................................................................................. 93
21.10 STC 18: Application of Prevailing Wage ............................................................. 93 EXHIBITS:
Exhibit A Description of Facility
Exhibit B Facility Construction and Commercial Operation Exhibit C [Intentionally Omitted]
Exhibit D Guaranteed Energy Production Damages Calculation Exhibit E Progress Reporting Form
Exhibit F Buyout Option
v
Exhibit G-1 Form of Commercial Operation Date Certificate Exhibit G-2 Form of Installed Capacity Certificate
Exhibit H Form of Construction Start Date Certificate
Exhibit I Form of Letter of Credit
Exhibit J Insurance
Exhibit K Form of Replacement RA Notice
Exhibit L L-1 Annual Energy Forecast
L-2 Monthly Expected Available Generating Capacity
L-3 Monthly Expected Available Storage Capacity
L-4 Monthly Expected PV Energy
Exhibit M Monthly Storage Availability
Exhibit N Storage Capacity Tests
Exhibit O Operating Restrictions
Exhibit P Metering Diagram
Exhibit Q RTE Shortfall Payments
Exhibit R Notices
Exhibit S Supply Chain Code of Conduct
POWER PURCHASE AND SALE AGREEMENT
This Power Purchase and Sale Agreement (“Agreement”) is entered into as of [_______________] (the “Effective Date”), between Seller and Buyer (each also referred to as a “Party” and collectively as the “Parties”).
RECITALS
WHEREAS, Seller intends to develop, design, construct, own or otherwise have control over, and operate the electric generating and energy storage facility as described in Exhibit A; and WHEREAS, Seller desires to sell, and Buyer desires to purchase, on the terms and conditions set forth in this Agreement, all Energy generated by the Generating Facility, all Green Attributes related to the generation of such Energy, all Capacity Attributes from the Facility, and all Storage 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 3.13. “Adjusted Energy Production” has the meaning set forth in Exhibit D.
“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. “AGC” has the meaning set forth in the CAISO Tariff.
“Aggregate Capability Constraint” has the meaning set forth in the CAISO Tariff. 2 “Agreement” has the meaning set forth in the Preamble and includes the Cover Sheet and any exhibits, schedules and any written supplements hereto. “Ancillary Services” means ancillary services as defined in the CAISO Tariff that are associated with the Storage Facility and that the Facility is capable of providing consistent with the Operating Restrictions , including Spinning Reserve, Non-Spinning Reserve, Regulation Up, and Regulation Down (as each is defined in the CAISO Tariff). “Assignment Agreement” has the meaning set forth in Section 14.4. “Attestation” has the meaning set forth in Section 4.1(b). “Automated Dispatch System” or “ADS” has the meaning set forth in the CAISO Tariff. “Availability Incentive Payment” has the meaning set forth in the CAISO Tariff. “Availability Notice” means the lower of (a) Seller’s availability forecasts issued and updated pursuant to Section 4.4 with respect to the Available Storage Capacity and Available Storage Capability, and (b) availability information reported to CAISO through OMS. “Available Generating Capacity” means the capacity from the Generating Facility, expressed in whole MWs, that is available at a particular time to generate Energy. “Available Storage Capability” has the meaning defined in Exhibit M. “Available Storage Capacity” has the meaning defined in Exhibit M. “Bankrupt” means with respect to any entity, such entity that (a) files a petition or otherwise commences, authorizes or acquiesces in the commencement of a proceeding or cause of action under any bankruptcy, insolvency, reorganization or similar Law, (b) has any such petition filed or commenced against it which remains unstayed or undismissed for a period of ninety (90) days, (c) makes an assignment or any general arrangement for the benefit of creditors, (d) otherwise becomes bankrupt or insolvent (however evidenced), (e) has a liquidator, administrator, receiver, trustee, conservator or similar official appointed with respect to it or any substantial portion of its property or assets, or (f) is generally unable to pay its debts as they fall due. “Bid” has the meaning set forth in the CAISO Tariff.
“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 14.4. “Buyer Bid Curtailment” means any curtailment of the Generating Facility arising out of or resulting from the manner in which Buyer bids, offers or schedules the Generating Facility, the 3 Energy or any Products, or in which Buyer fails to do so, where either all of the following (a) through (c) occurs, or (d) occurs:
(a) the CAISO provides notice, including through ADS, to a Party or the Scheduling Coordinator for the Generating Facility, requiring the Party to deliver less PV Energy from the Generating Facility than is reflected in the VER Forecast for the Generating Facility for a period of time;
(b) for the same time period as referenced in (a), Buyer or the Scheduling Coordinator for the Facility:
(i) did not submit a Self-Schedule or an Energy Supply Bid for the MW subject to the reduction; or
(ii) submitted an Energy Supply Bid and the CAISO notice referenced in (a) is solely a result of CAISO implementing the Energy Supply Bid; or (iii) submitted a Self-Schedule for less than the full amount of VER Forecast for the Generating Facility; and
(c) no other circumstances exist that constitute a Scheduled Maintenance, Forced Facility Outage, Force Majeure Event and/or a Curtailment Period during the same time period as referenced in (a); or
(d) during a period when all of the following occur: (i) Buyer submitted a Bid or Self-Schedule for Ancillary Services with respect to the Storage Facility for such Settlement Interval, (ii) is awarded an Ancillary Services Schedule by the CAISO with respect to Storage Facility for such Settlement Interval, (iii) the Generating Facility is instructed by the CAISO to follow the Dispatch Operating Target (as defined in the CAISO Tariff) other than due to a Curtailment Order, and (iv) the Generating Facility would have generated PV Energy in excess of the Dispatch Operating Target but for such instruction from the CAISO. “Buyer Curtailment Order” means the instruction from Buyer to Seller to reduce delivery of PV Energy by the amount, and for the period of time set forth in such order, for reasons unrelated to a Scheduled Maintenance, Forced Facility Outage, Force Majeure Event and/or Curtailment Order, which instruction may be communicated to Seller in writing by electronic notice or other commercially reasonable means.
“Buyer Curtailment Period” means the period of time, as measured using current Settlement Intervals, during which Seller reduces delivery of PV Energy pursuant to or as a result of (i) Buyer Bid Curtailment or (ii) a Buyer Curtailment Order. 4 “Buyer Default” means a Buyer Event of Default.
“Buyer’s WREGIS Account” has the meaning set forth in Section 4.9(a). “CAISO” means the California Independent System Operator Corporation or any successor entity performing similar functions.
“CAISO Approved Meter” means a CAISO approved revenue quality meter or meters, CAISO approved data processing gateway or remote intelligence gateway, telemetering equipment and data acquisition services sufficient for monitoring, recording and reporting, in real time all Energy delivered by the Facility to the Delivery Point adjusted for or net of Electrical Losses and Station Use, in accordance with the CAISO Tariff. “CAISO Certification” means the certification and testing requirements for a storage facility, such as the Facility, as set forth in the CAISO Tariff that are applicable to the Facility, including certification and testing for all Ancillary Services, PMAX, and PMIN associated with such storage facility, that are applicable to the Facility. “CAISO Charges Invoice” has the meaning set forth in Section 4.3(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 No Pay” has the meaning for the term “No Pay” as set forth in the CAISO Tariff. “CAISO Operating Order” means the “operating order” defined in Section 37.2.1.1 of the CAISO Tariff.
“CAISO-Penalized Shortfall” has the meaning set forth in Section 3.9(b)(ii). “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.
“Calculation Interval” has the meaning set forth in Exhibit M. “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) codified in, inter alia, California Public Utilities Code Sections 399.11 through 399.31 and California Public Resources Code Sections 25740 through 25751, as such provisions are amended or supplemented from time to time. “Capacity Attribute” means any current or future defined characteristic, certificate, tag, credit, or accounting construct associated with the amount of Energy that the Facility can generate 5 and/or deliver to the Delivery Point at a particular moment and that can be purchased, sold, traded or used for a Person’s legal or regulatory compliance under the CPUC or CAISO market rules, including Resource Adequacy Benefits and MTR Attributes. “Capacity Damages” has the meaning set forth in Exhibit B. “Capacity Test” or “CT” means the Commercial Operation Storage Capacity Test, Storage Capacity Test, or any other test conducted pursuant to Exhibit N. “CEC” means the California Energy Commission or its successor agency. “CEC Final Certification and Verification” means that the CEC has certified the Generating Facility as an Eligible Renewable Energy Resource for purposes of the California Renewables Portfolio Standard, meeting all applicable requirements for certified facilities set forth in the RPS Eligibility Guidebook, Ninth Edition (or its successor), and that all Energy generated by the Generating Facility qualifies as generation from an Eligible Renewable Energy Resource. “CEC Precertification” means that the CEC has issued a precertification for the Generating Facility indicating that the planned operations of the Generating Facility would comply with applicable CEC requirements for CEC Final Certification and Verification. “Change of Control”, in the case of Seller, means,
any circumstance in which Seller’s 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 its Ultimate Parent indirectly through one or more intermediate entities shall not be counted towards the Ultimate Parent’s ownership interest in Seller unless the 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.
“Charging Energy”
“Charging Notice” means the operating instruction, and any subsequent updates, given by Buyer or the CAISO, directing the Storage Facility to charge at a specific MW rate to a specified Stored Energy Level; provided, any such operating instruction shall be in accordance with Section
4.6, the Operating Restrictions and the CAISO Tariff. Any Charging Notice shall not constitute a Buyer Bid Curtailment, Buyer Curtailment Order, or Curtailment Order. 6 “Co-located Resource” has the meaning set forth in the CAISO Tariff. “Commercial Operation” has the meaning set forth in Exhibit B. “Commercial Operation Date” has the meaning set forth in Exhibit B. “Commercial Operation Delay Damages” means an amount equal to (a) the Development Security amount required hereunder, divided by (b) ninety (90). “Commercial Operation Storage Capacity Test” means the Storage Capacity Test conducted in connection with Commercial Operation of the Storage Facility, including any additional Storage Capacity Test for additional Storage Facility capacity installed after the Commercial Operation Date pursuant to Section 5 of Exhibit B. “Compliance Actions” has the meaning set forth in Section 3.13. “Compliance Expenditure Cap” has the meaning set forth in Section 3.13. “Confidential Information” has the meaning set forth in Section 19.1. “Construction Start” has the meaning set forth in Exhibit B. “Construction Start Date” has the meaning set forth in Exhibit B. “Contract Price” means each of the Renewable Rate and Storage Rate. “Contract Term” has the meaning set forth in Section 2.1(a). “Contract Year” means a period of twelve (12) consecutive months. The first Contract Year shall commence on the Commercial Operation Date, and each subsequent Contract Year shall commence on the anniversary of the Commercial Operation Date. “Control” (including, with correlative meanings, the terms “Controlled by” and “under common Control with”), as used with respect to any Person, shall mean the direct or indirect right to cast more than 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 more than fifty percent (50%) of the equity or other ownership interest in such Person. “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 or financed its obligations or entering into new arrangements which replace this 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.
“CPM Soft Offer Cap” has the meaning set forth in the CAISO Tariff. “CPUC” means the California Public Utilities Commission, or successor entity. 7 “CPUC-Penalized Shortfall” has the meaning set forth in Section 3.9(b)(i). “CPUC System RA Penalty” means the penalties for “System RA Deficiency” adopted by the CPUC in the Resource Adequacy Rulings.
“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, in either case by S&P or Moody’s. If ratings by S&P and Moody’s are not equivalent, the lower rating shall apply. “CRS” has the meaning set forth in Section 4.1(b).
“Curtailment Order” means any of the following:
(a) CAISO orders, directs, alerts, or provides notice to a Party, including a CAISO Operating Order, to curtail Energy deliveries for any reason other than a Buyer Bid Curtailment; (b) a curtailment ordered by the Participating Transmission Owner or distribution operator (if the Facility is interconnected to distribution or sub-transmission system) for reasons including, but not limited to, (i) any situation that affects normal function of the electric system including, but not limited to, any abnormal condition that requires action to prevent circumstances such as equipment damage, loss of load, or abnormal voltage conditions, or (ii) any warning, forecast or anticipation of conditions or situations that jeopardize the Participating Transmission Owner’s or distribution operator’s electric system integrity or the integrity of other systems to which the Participating Transmission Owner is connected; (c) a curtailment ordered by the Participating Transmission Owner due to scheduled or unscheduled maintenance on the Participating Transmission Owner’s transmission facilities that prevents either Party from receiving or delivering Energy to the Delivery Point; or (d) a curtailment in accordance with Seller’s obligations under its Interconnection Agreement with the Participating Transmission Owner or distribution operator.
If Buyer or Buyer’s Scheduling Coordinator submitted a Self-Schedule and/or an Energy Supply Bid in its final CAISO market participation in respect of a given time period that clears, in full, the applicable CAISO market for the full amount of Energy forecasted to be produced by or delivered from the Facility for such time period, any notice from the CAISO having the effect of requiring a reduction during the same time period is a Curtailment Order, not a Buyer Bid Curtailment.
“Curtailment Period” means the period of time, as measured using current Settlement Intervals, during which Seller reduces energy from the Facility pursuant to a Curtailment Order. “Daily Delay Damages” means an amount equal to (a) the Development Security amount required hereunder, divided by (b) one hundred twenty (120). 8 “Damage Payment” means a liquidated damages payment 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 set forth in Section 11.3(a). “Day-Ahead Forecast” has the meaning set forth in Section 4.4(c). “Day-Ahead LMP” means the LMP for the Day-Ahead Market. “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 that qualifies as PCC1, expressed in MWh, that the Generating Facility would have produced and delivered to the Delivery Point, but that is not produced by the Generating Facility and delivered to the Delivery Point during a Buyer Curtailment Period, which amount shall be equal to (a) the VER Forecast expressed in MWh, applicable to the Buyer Curtailment Period, or (b) if there is no VER Forecast available or Seller demonstrates to Buyer’s reasonable satisfaction that the VER Forecast does not represent an accurate forecast of generation from the Generating Facility, the amount determined by a third party reasonably acceptable to Buyer using an industry standard forecasting or back-casting methodology to determine the potential generation of the Generating Facility as a function of Available Generating Capacity, solar insolation and panel temperature, and other pertinent data for the period of time during the Buyer Curtailment Period, in either case less the amount of PV Energy delivered to the Delivery Point during the Buyer Curtailment 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 4.9(e). “Delivery Point” means the PNode designated by the CAISO for the Generating Facility and the PNode designated by the CAISO for the Storage Facility, as applicable. “Delivery Term” shall mean the period of Contract Years specified 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 (i) cash or (ii) a Letter of Credit in the amount specified for the Development Security on the Cover Sheet, deposited with Buyer in conformance with Section 8.7.
“Discharging Energy”
9 “Discharging Notice” means the operating instruction, and any subsequent updates, given by Buyer or CAISO to Seller, instructing the Storage Facility to discharge Discharging Energy at a specific MWh rate to a specified Stored Energy Level, provided, any such operating instruction or updates shall be in accordance with Section 4.6, the Operating Restrictions and the CAISO Tariff.
“Diverse Business Enterprises” means a women, minority, disabled veteran, lesbian, gay, bisexual and /or transgender business enterprise, as more particularly set forth in CPUC General Order 156.
“Early Termination Date” has the meaning set forth in Section 11.2. “Effective Date” has the meaning set forth on the Preamble. “Electrical Losses” means all transmission or transformation losses between the Facility and the Delivery Point, including losses associated with (i) delivery of PV Energy to the Delivery Point, (ii) delivery of Charging Energy to the Storage Facility, and (iii) delivery of Discharging Energy to the Delivery Point.
“Eligible Intermittent Resources Protocol” or “EIRP” has the meaning set forth in the CAISO Tariff.
“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. “EMS” has the meaning set forth in the CAISO Tariff.
“Energy” means metered electrical energy measured in MWh. “Energy Supply Bid” has the meaning set forth in the CAISO Tariff. “Event of Default” has the meaning set forth in Section 11.1. “Excess MWh” has the meaning set forth in Section 3.3(c). “Expected Energy” has the meaning set forth in Section 4.8. “Facility” means the Generating Facility and the Storage Facility, as described more fully in Exhibit A attached hereto.
“Facility Energy” means the sum of PV Energy and Discharging Energy during any Settlement Interval or Settlement Period, as measured by the CAISO Approved Meter. “FERC” means the Federal Energy Regulatory Commission or any successor government agency.
“Flexible Capacity” has the meaning set forth in the CAISO Tariff. 10 “Flexible Capacity Category” has the meaning set forth in the CAISO Tariff. “Flexible Resource Adequacy Benefits” means the attributes, however defined, of a resource that can be used to satisfy the flexible resource adequacy obligations of a load serving entity, including Flexible Capacity.
“FMM Schedule” has the meaning set forth in the CAISO Tariff. “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 or any outage on the Transmission System that prevents Seller from generating or delivering power to the Delivery Point or providing Storage Product and that is not the result of a Force Majeure Event.
“Forward Certificate Transfers” has the meaning set forth in the WREGIS Operating Rules.
“Full Capacity Deliverability Status” or “FCDS” has the meaning set forth in the CAISO Tariff.
“Full Network Model” has the meaning set forth in the CAISO Tariff. “Future Environmental Attributes” shall mean any and all emissions, air quality or other environmental attributes (other than Green Attributes or Renewable Energy Incentives) 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) that are attributable, now, or in the future, to the generation of electrical energy by the Facility. Future Environmental Attributes do not include (i) any energy, capacity, reliability or other power attributes from the Facility, (ii) investment or production tax credits associated with the construction or operation of the Facility and other financial incentives in the form of credits, reductions, or allowances associated with the Facility that are applicable to a state or federal income taxation obligation, (iii) fuel-related subsidies or “tipping fees” that may be paid to Seller to accept certain fuels, or local subsidies received by the generator for the destruction of particular preexisting pollutants or the promotion of local environmental benefits, or (iv) emission reduction credits encumbered or used by the Facility for compliance with local, state, or federal operating and/or air quality permits. “Gains” means, with respect to any Party, an amount equal to the present value of the economic benefit to it, if any (exclusive of Costs), resulting from the termination of this Agreement for the remaining Contract Term, determined in a commercially reasonable manner. Factors used in determining the economic benefit to a Party may include, without limitation, reference to information supplied by one or more third parties, which shall exclude Affiliates of the Non-Defaulting Party, including without limitation, quotations (either firm or indicative) of relevant rates, prices, yields, yield curves, volatilities, spreads or other relevant market data in the relevant markets, comparable transactions, forward price curves based on economic analysis of the relevant 11 markets, settlement prices for comparable transactions at liquid trading hubs (e.g., NP-15), all of which should be calculated for the remaining Contract Term, and includes the value of Green Attributes and Capacity Attributes.
“Generating Facility” means the separately metered 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 PV Energy to the Delivery Point, including Seller’s rights and interests in Shared Facilities; provided, the “Generating Facility” does not include the Storage Facility or the portions of Shared Facilities other than Seller’s rights and interests thereto.
“Generating Facility Meter” means the CAISO Approved Meter (with a 0.3 accuracy class), sufficient for monitoring, recording and reporting, in real time, the amount of PV Energy generated by the Generating Facility and calculated as delivered to Buyer at the Delivery Point.
For clarity, the Generating Facility may contain multiple measurement devices and calculations that will make up the Generating Facility Meter, and, unless otherwise indicated, references to the Generating Facility Meter shall mean all such measurement devices and calculations and the aggregated data of all such measurement devices and calculations, taken together. “GHG Regulations” means Title 17, Division 3 (Air Resources), Chapter 1 (Air Resources Board), Subchapter 10 (Climate Change), Article 5 (Emissions Cap), Sections 95800 to 96023 of the California Code of Regulations, as amended or supplemented from time to time. “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; 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, attributable to the generation from the Facility, and its displacement of conventional Energy generation. Green Attributes include but are not limited to Renewable Energy Credits, as well as: (1) any avoided emissions of pollutants to the air, soil or water such as sulfur oxides (SOx), nitrogen oxides (NOx), carbon monoxide (CO) and other pollutants; (2) any avoided emissions of carbon dioxide (CO2), methane (CH4), nitrous oxide, hydrofluorocarbons, perfluorocarbons, sulfur hexafluoride and other greenhouse gases (GHGs) that have been determined by the United Nations Intergovernmental Panel on Climate Change, or otherwise by Law, to contribute to the actual or potential threat of altering the Earth’s climate by trapping heat in the atmosphere; (3) the reporting rights to these avoided emissions, such as Green Tag Reporting Rights. Green Tags are accumulated on a MWh basis and one Green Tag represents the Green Attributes associated with one (1) MWh of Energy. Green Attributes do not include (i) any energy, capacity, reliability or other power attributes from the Facility, (ii) investment or production tax credits associated with the construction or operation of the Facility and other financial incentives in the form of credits, reductions, or allowances associated with the Facility that are applicable to a state or federal income taxation obligation, (iii) fuel-related subsidies or “tipping fees” that may be paid to Seller to accept certain fuels, or local subsidies received by the generator for the destruction of particular preexisting pollutants or the promotion of local 12 environmental benefits, or (iv) emission reduction credits encumbered or used by the Facility for compliance with local, state, or federal operating and/or air quality permits. If the Facility is a biomass or landfill gas facility and Seller receives any tradable Green Attributes based on the greenhouse gas reduction benefits or other emission offsets attributed to its fuel usage, it shall provide Buyer with sufficient Green Attributes to ensure that there are zero net emissions associated with the production of electricity from the Facility. “Green Tag Reporting Rights” means the right of a purchaser of renewable energy to report ownership of accumulated “green tags” in compliance with and to the extent permitted by applicable Law and include, without limitation, rights under Section 1605(b) of the Energy Policy Act of 1992, and any present or future federal, state or local certification program or emissions trading program, including pursuant to the WREGIS Operating Rules. “Greenhouse Gas” or “GHG” has the meaning set forth in the GHG Regulations or in any other applicable Laws.
“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 3.5, updated December 15, 2020, as may be further amended from time to time. “Guaranteed Commercial Operation Date” has the meaning set forth in Exhibit B. “Guaranteed Construction Start Date” has the meaning set forth in Exhibit B. “Guaranteed Energy Production” has the meaning set forth in Section 4.8. “Guaranteed Interconnection Capacity” means the interconnection rights provided under the Interconnection Agreement in the amount set forth on the Cover Sheet. “Guaranteed PV Capacity” means the amount set forth on the Cover Sheet, as may be adjusted pursuant to Exhibit G-2.
“Guaranteed RA Capacity” means the Guaranteed Storage Capacity. “Guaranteed Round-Trip Efficiency” means the minimum guaranteed Round-Trip Efficiency of the Storage Facility required during each month commencing upon Commercial Operation and continuing throughout the Delivery Term, as set forth on the Cover Sheet. “Guaranteed Storage Availability” has the meaning set forth on the Cover Sheet. “Guaranteed Storage Capacity” has the meaning set forth on the Cover Sheet, as may be adjusted pursuant to Exhibit B.
13 “Imbalance Energy” means the amount of Energy, in any given Settlement Period or Settlement Interval, by which the amount of Facility Energy deviates from the amount of Scheduled Energy, including Uninstructed Imbalance Energy (as defined in the CAISO Tariff). “Indemnified Party” has the meaning set forth in Section 17.1. “Indemnifying Party” has the meaning set forth in Section 17.1. “Initial Synchronization” means the initial delivery of Energy from the Facility to the interconnection point specified in the Interconnection Agreement. “Installed PV Capacity” means the actual generating capacity of the Facility, measured at the Facility PNode and adjusted for ambient conditions on the date of the performance test, not to exceed the Guaranteed PV Capacity, as evidenced by a certificate substantially in the form attached as Exhibit I-2 hereto provided by Seller to Buyer. “Installed Storage Capacity” means the maximum dependable operating capability of the Storage Facility to discharge electric energy for four (4) consecutive hours at the maximum discharge rate (up to but not in excess of the Guaranteed Storage Capacity), as measured in MW at the Delivery Point, that achieves Commercial Operation, as evidenced by a certificate substantially in the form attached as Exhibit G-2 hereto provided by Seller to Buyer. “Inter-SC Trade” or “IST” has the meaning set forth in the CAISO Tariff. “Interconnection Agreement” means the interconnection agreement entered into by Seller 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. “Interconnection Facilities” means the interconnection facilities, control and protective devices and metering facilities required to connect the Facility with the Transmission System (or PTO’s distribution system, as applicable) in accordance with the Interconnection Agreement. “Interest Rate” has the meaning set forth in Section 8.2. “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 February 29, 2016 under which Buyer is organized as a Joint Powers Authority in accordance with the Joint Powers Act.
“kW” means kilowatts in alternating current, unless expressly stated in terms of direct current.
15 “Local Capacity Area Resource Adequacy Benefits” means the attributes, however defined, of a Local Capacity Area Resource that can be used to satisfy the local resource adequacy obligations of a load serving entity.
“Locational Marginal Price” or “LMP” has the meaning set forth in the CAISO Tariff. “Losses” means, with respect to any Party, an amount equal to the present value of the economic loss to it, if any (exclusive of Costs), resulting from termination of this Agreement for the remaining Contract Term, determined in a commercially reasonable manner. Factors used in determining economic loss to a Party may include, without limitation, reference to information supplied by one or more third parties, which shall exclude Affiliates of the Non-Defaulting Party, including without limitation, quotations (either firm or indicative) of relevant rates, prices, yields, yield curves, volatilities, spreads or other relevant market data in the relevant markets, comparable transactions, forward price curves based on economic analysis of the relevant markets, settlement prices for comparable transactions at liquid trading hubs (e.g., NYMEX), all of which should be calculated for the remaining Contract Term and must include the value of Green Attributes, Capacity Attributes, and Renewable Energy Incentives.
“Lost Output” has the meaning set forth in Exhibit D.
“Main Power Transformer” means the Facility’s main step-up transformer as depicted on the one-line diagram set forth in Exhibit A.
“Milestones” means the development activities for significant permitting, interconnection, financing and construction milestones set forth in the Cover Sheet. “Monthly Storage Availability” has the meaning set forth in Exhibit M. “Moody’s” means Moody’s Investors Service, Inc., or its successor. “MTR Attributes” has the meaning set forth in Section 3.15(a). “MTR Requirements” has the meaning set forth in Section 3.15. “MW” means megawatts measured 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, whether in the Day-Ahead Market or Real-Time Market, the LMP is less than zero dollars ($0). “Negative LMP Costs” has the meaning set forth in Section 3.3(c). “Net Qualifying Capacity” has the meaning set forth in the CAISO Tariff. “Network Upgrades” has the meaning set forth in the CAISO Tariff. 16 “Non-Availability Charge” has the meaning set forth in the CAISO Tariff. “Non-Defaulting Party” has the meaning set forth in Section 11.2. “Notice” shall, unless otherwise specified in this Agreement, mean written communications by a Party to be delivered by hand delivery, United States mail, overnight courier service, facsimile or electronic messaging (e-mail).
“Operating Restrictions” means the requirements and limitations set forth on Exhibit O-1. “Other Facility(ies)” means the electric generating or energy storage facility(ies), other than the Facility, utilizing any facilities shared with the Facility to enable delivery of energy from each such other generating or storage facility to the Delivery Point, together with all materials, equipment systems, structures, features and improvements necessary to produce or store electric energy at each such other generating or storage facility, but (i) with respect to the Shared Facilities, excluding Seller’s interests therein and (ii) excluding the real property on which each such other generating or storage facility is, or will be located, land rights and interests in land. “Partial Capacity Deliverability Status” or “PCDS” has the meaning set forth in the CAISO Tariff.
“Participating Transmission Owner” or “PTO” means an entity that owns, operates and maintains transmission or distribution lines and associated facilities and/or has entitlements to use certain transmission or distribution lines and associated facilities where the Facility is interconnected. For purposes of this Agreement, the Participating Transmission Owner is Pacific Gas & Electric Company.
“Party” has the meaning set forth in the Preamble.
“Performance Measurement Period” has the meaning set forth in Section 4.8. “Performance Security” means (i) cash, or (ii) a Letter of Credit, in the amount specified for the Performance Security on the Cover Sheet, deposited with Buyer in conformance with Section 8.8.
“Performance Security End Date” has the meaning set forth in Section 8.8. “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.
“PMAX” means the applicable CAISO-certified maximum operating level of the Storage Facility.
“PMIN” means the applicable CAISO-certified minimum operating level of the Storage Facility.
17 “PNode” has the meaning set forth in the CAISO Tariff. “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.
“Primary Availability” has the meaning set forth in Exhibit M. “Product” has the meaning set forth on the Cover Sheet. “Progress Report” means a progress report including the items set forth in Exhibit E. “Project” has the same meaning as Generating Facility.
“Prudent Operating Practice” means the practices, methods and standards of professional care, skill and diligence engaged in or approved by a significant portion of the electric power industry in the Western United States for facilities of similar size, type, and design, that, in the exercise of reasonable judgment, in light of the facts known at the time, would have been expected to accomplish results consistent with Law, reliability, safety, environmental protection, applicable codes, and standards of economy and expedition. Prudent Operating Practices are not necessarily defined as the optimal standard practice method or act to the exclusion of others, but rather refer to a range of actions reasonable under the circumstances. “PV Energy” means all Energy produced by the Generating Facility, as measured by the Generating Facility Meter after adjustment to exclude (a) all Electrical Losses, and (b) all Energy that serves Station Use.
“Qualified Reporting Entity” has the meaning set forth in the WREGIS Operating Rules. “Qualifying Capacity” has the meaning set forth in the CAISO Tariff. “RA Deficiency Amount” means the liquidated damages payment that Seller shall pay to Buyer for an applicable RA Shortfall Month as calculated in accordance with Section 3.9(b). “RA Guarantee Date” means the Commercial Operation Date. “RA Plan” has the meaning set forth for “Resource Adequacy Plan” in the CAISO Tariff with respect to Buyer’s monthly or annual Resource Adequacy showings to the CAISO and CPUC. “RA Shortfall” means, for a given Showing Month, the difference, expressed in kW, of (a) the Storage Facility’s Qualifying Capacity minus (b) the sum of (i) the portion of the Net Qualifying Capacity of the Storage Facility for such month able to be shown on Buyer’s monthly 18 or annual RA Plan to the CAISO and CPUC and counted as Resource Adequacy Benefits, plus (ii) Replacement RA provided by Seller with respect to an expected shortfall in Resource Adequacy Benefits of the Storage Facility for such Showing Month, if applicable (as determined fifteen (15) Business Days prior to the Showing Deadline for such Showing Month), The RA Shortfall shall be determined on the later of (x) the date that is fifteen (15) Business Days prior to the Showing Deadline, and (y) if applicable, the date (after the date that is fifteen (15) Business Days prior to the Showing Deadline) on which Buyer purchases replacement Resource Adequacy Benefits.
“RA Shortfall Month” means, for purposes of calculating an RA Deficiency Amount under Section 3.9(b), any month shown on an RA Plan, commencing with the RA Plan for the Showing Month that includes the RA Guarantee Date (including any month during the period between the RA Guarantee Date and the first day of the first Showing Month for Buyer which actually includes the Storage Facility’s Resource Adequacy Benefits or any Replacement RA, if applicable), for which there is an RA Shortfall.
“RA Substitute Capacity” has the meaning set forth in the CAISO Tariff. “Real-Time Market” has the meaning set forth in the CAISO Tariff. “Reimbursable Station Use” has the meaning set forth in Section 6.4(i). “
“Remedial Action Plan” has the meaning set forth in Section 2.4. “Renewable Energy Credit” or “REC” has the meaning set forth in California Public Utilities Code Section 399.12(h), as may be amended from time to time or as further defined or supplemented by Law.
“Renewable Energy Incentives” means: (a) all federal, state, or local Tax credits or other Tax benefits associated with the construction, ownership, or production of electricity from the Facility (including credits under Sections 38, 45, 46 and 48 of the Internal Revenue Code of 1986, as amended); (b) any federal, state, or local grants, subsidies or other like benefits relating in any way to the Facility, including a cash grant available under Section 1603 of Division B of the American Recovery and Reinvestment Act of 2009, provided 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 are not a Green Attribute or a Future Environmental Attribute.
“Renewable Rate” means the price per MWh of PV Energy that qualifies as PCC1, as set forth on the Cover Sheet, and as may be adjusted by Section 3.3. “Replacement RA” means Resource Adequacy Benefits (including satisfying the same Slice-of-Day operations profile and related characteristics) equivalent to those that would have been provided by the Facility with respect to the applicable month for which the Replacement RA 19 is being provided. Replacement RA shall (a) include, if applicable, Flexible Resource Adequacy Benefits that are of the same system designation, and Flexible Capacity Category as the Facility; (b) to the extent that the Facility would have qualified as a Local Capacity Area Resource for such month, be located in the same Local Capacity Area as the Facility; and (c) is capable of providing Resource Adequacy Benefits in the same hourly periods as the Facility or is otherwise acceptable to Buyer in its sole discretion. Replacement RA shall not be provided from any generating facility or unit that utilizes coal or coal materials as a source of fuel. “Resource Adequacy Benefits” means the rights and privileges attached to the Facility that satisfy any entity’s resource adequacy obligations, as those obligations are set forth in any Resource Adequacy Ruling, and shall include System Resource Adequacy Benefits, Flexible Resource Adequacy Benefits, and Local Capacity Area Resource Adequacy Benefits associated with the Facility.
“Resource Adequacy Rulings” means CPUC Decisions 04-01-050, 04-10-035, 05-10-042, 06-04-040, 06-06-064, 06-07-031, 07-06-029, 08-06-031, 09-06-028, 10-06-036, 11-06-022, 12-06-025, 13-06-024, 14-06-050, 15-06-063, 16-06-045, 17-06-027, 18-06-030, 18- 06-031, 19-02-022, 19-06-026, 19-10-021, 20-01-004, 20-03-016, 20-06-002, 20-06-028, 20-06- 031, 20-12-006, 21-06-029, 21-07-014, 22-03-034, 22-06-050, 22-12-028, 22-08-039, 23-04-010 and any other existing or subsequent ruling or decision, or any other resource adequacy laws, rules or regulations enacted, adopted or promulgated by any applicable Governmental Authority, however described, as such decisions, rulings, Laws, rules or regulations may be amended or modified from time-to-time throughout the Contract Term. “Resource ID” has the meaning set forth in the CAISO Tariff. “
“Round-Trip Efficiency” has the meaning set forth in Exhibit Q. “Round-Trip Efficiency Factor” has the meaning set forth in Exhibit Q. “RTD Instructed Imbalance Energy” has the meaning set forth in the CAISO Tariff. “RTE Shortfall Payment” has the meaning set forth in Exhibit Q. “S&P” means the Standard & Poor’s Financial Services, LLC (a subsidiary of The McGraw-Hill Companies, Inc.) or its successor.
“SCADA” means the standard supervisory control and data acquisition systems to be installed by Seller as part of the Facility, including those system components that enable Seller to receive ADS and AGC instructions from the CAISO or similar instructions from Buyer’s SC. “Schedule” has the meaning set forth in the CAISO Tariff. “Scheduled Energy” means the Energy reflected in a final Day-Ahead Schedule, FMM Schedule, and/or any other financially binding Schedule, market instruction or dispatch for the Facility for a given period of time.
20 “Scheduled Maintenance” has the meaning set forth in Section 6.1(a). “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 4.9(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).
“Settlement Interval” has the meaning set forth in the CAISO Tariff. “Settlement Period” has the meaning set forth in the CAISO Tariff, which as of the Effective Date is the period beginning at the start of the hour and ending at the end of the hour. “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 to the Delivery Point, including the Interconnection Facilities and the Interconnection Agreement itself, if applicable, that are used in common with third parties or by Seller for electric generation or storage facilities owned by Seller other than the Facility. “Showing Deadline” means the initial deadline that a Scheduling Coordinator must meet to submit its RA Plan, as established by CAISO or any other Governmental Authority. For illustrative purposes only, as of the Effective Date, the CAISO monthly Showing Deadline is approximately forty-five (45) days prior to the RA delivery month. “Showing Month” means the calendar month of the Delivery Term that is the subject of the RA Plan, as set forth in the Resource Adequacy Rulings and outlined in the CAISO Tariff. For illustrative purposes only, as of the Effective Date, the monthly RA Plan made in June is for the Showing Month of August.
21 “Site” means the real property on which the Facility is or will be located, as further described in Exhibit A, and as shall be updated by Seller at the time Seller provides an executed Construction Start Date Certificate to Buyer, in substantially the form of the Form of Construction Start Date Certificate in Exhibit H.
“Site Control” means that Seller: (a) owns or has the option to purchase the Site; (b) is the lessee or has the option to lease the Site; or (c) is the holder of an easement or an option for an easement, right-of-way grant, or similar instrument with respect to the Site. “SOC” or “State of Charge” means (a) the Stored Energy Level relative to (b) the Storage Capacity multiplied by four (4) hours, expressed as a percentage. The “SOC” shall represent the range of Stored Energy Level reserved exclusively for Buyer’s use; provided, Seller may represent such range anywhere within the actual available capability of the Storage Facility. “SOD” or “Slice-of-Day” has the meaning set forth in the Resource Adequacy Rulings. “Station Use” has the meaning given in the tariff of the retail provider of energy for the Facility and reflects:
(a) the electric energy that is used within the Facility (including to power the lights, motors, control systems, thermal regulation equipment and other electrical loads) and that is necessary for operation of the Facility; and
(b) the electric energy that is consumed within the Facility’s electric energy distribution system as losses (other than any losses that are Electrical Losses). “Storage Availability Adjustment” has the meaning set forth in Exhibit M. “Storage Capacity” means the maximum dependable operating capability of the Storage Facility (expressed in MW AC) to discharge electric energy at the maximum discharge rate that can be sustained for four (4) consecutive hours, as the same is to be established as of the Commercial Operation Date and adjusted from time to time pursuant to Exhibit N to reflect the results of the most recently performed Storage Capacity Test (including the Commercial Operation Storage Capacity Test); provided, the Storage Capacity shall not at any time exceed the lesser of (a) the Guaranteed Storage Capacity (with respect to a Commercial Operation Storage Capacity Test), and (b) the Storage Facility’s then current PMAX in the Storage Facility’s CAISO’s Master Data File and Resource Data Template (or successor data systems) (with respect to any other Storage Capacity Test).
“Storage Capacity Payment” has the meaning set forth in Section 3.3(e). “Storage Capacity Test” or “SCT” means any test or retest of the capacity of the Storage Facility conducted in accordance with the testing procedures, requirements and protocols set forth in Exhibit N.
22 “Storage Facility” means the energy storage facility described on the Cover Sheet and in Exhibit A (including the operational requirements of the energy storage facility), located at the Site and including mechanical equipment and associated facilities and equipment and Seller’s rights and interests in Shared Facilities required to deliver the Storage Product, but excluding any portions of Shared Facilities other than Seller’s rights and interests thereto. “Storage Facility Meter” means the CAISO Approved Meter (with a 0.3 accuracy class), sufficient for monitoring, recording and reporting, in real time, the amount of (i) Charging Energy, (ii) Discharging Energy and (iii) Energy that serves Station Use. For clarity, the Facility may include multiple measurement devices and calculations that will make up the Storage Facility Meter, and, unless otherwise indicated, references to the Storage Facility Meter shall mean all such measurement devices and calculations and the aggregated data of all such measurement devices and calculations, taken together.
“Storage Product” means (a) the ability of the Storage Facility to accept and store Charging Energy and to deliver Discharging Energy in accordance with the terms of this Agreement, (b) Capacity Attributes, if any, (c) Storage Capacity, and (d) Ancillary Services (as defined in the CAISO Tariff), if any, in each case arising from or relating to the Storage Facility. “Storage Rate” has the meaning set forth on the Cover Sheet. “Stored Energy” means the electric energy in the Storage Facility available to be discharged as Discharging Energy.
“Stored Energy Level” means, at a particular time, the amount of electric energy in the Storage Facility available to be discharged as Discharging Energy, expressed in MWh. “Subsequent Purchasers” means the purchaser or recipient of Product from Buyer in any conveyance, re-sale or remarketing of Product by Buyer. “Supplementary Capacity Test Protocol” has the meaning set forth in Exhibit N. “Supply Chain Code” has the meaning set forth in Exhibit S. “Supply Plan” has the meaning set forth in the CAISO Tariff. “System Emergency” means any condition that: (a) requires, as determined and declared by CAISO or the PTO, automatic or immediate action to (i) prevent or limit harm to or loss of life or property, (ii) prevent loss of transmission facilities or generation supply in the immediate vicinity of the Facility, or (iii) preserve Transmission System reliability, and (b) directly affects the ability of any Party to perform under any term or condition in this Agreement, in whole or in part.
“System Resource Adequacy Benefits” means the attributes, however defined, of a resource that can be used to satisfy the resource adequacy obligations of a load serving entity, other than Flexible Resource Adequacy Benefits and Local Capacity Area Resource Adequacy Benefits. 23 “Tangible Net Worth” means the tangible assets (for example, not including intangibles such as goodwill and rights to patents or royalties) that remain after deducting liabilities as determined in accordance with generally accepted accounting principles. “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. “Terminated Transaction” has the meaning set forth in Section 11.2. “Termination Payment” has the meaning set forth in Section 11.3. “Test Energy” means the Energy delivered (a) commencing on the later of (i) the first date that the CAISO informs Seller in writing that Seller may deliver Energy from the Facility to the CAISO and (ii) the first date that the PTO informs Seller in writing that Seller has conditional or temporary permission to parallel and (b) ending upon the occurrence of the Commercial Operation Date.
“Test Energy Acceptance Deadline” has the meaning set forth in Section 3.7(a). “Test Energy Acceptance Notice” has the meaning set forth in Section 3.7(a). “Test Energy ROFR Notice” has the meaning set forth in Section 3.7(a). “Transformer Failure” means a failure of all or part of the Main Power Transformer that results in the Facility being unable to deliver Facility Energy or receive Charging Energy during such failure, and such failure was not caused by Seller and could not have been avoided through the exercise of Prudent Operating Practices.
“Transmission Provider” means the CAISO, as applicable. “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.
“Ultimate Parent”
“Variable Energy Resource” or “VER” has the meaning set forth in the CAISO Tariff. 24 “Variable Energy Resource Forecast” or “VER Forecast” means, for a given period, the final forecast of the Energy to be produced by the Facility prepared by the CAISO in accordance with the Eligible Intermittent Resources Protocol.
“WECC” means the Western Electricity Coordinating Council or its successor. “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 4.9(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 January 4, 2021, 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 Section, paragraph, clause of, or that Party or Exhibit to, this Agreement unless otherwise specified;
(e) a reference to a document or agreement, including this Agreement shall mean such document, agreement or this Agreement including any amendment or supplement to, or replacement, novation or modification of this Agreement, but disregarding any amendment, supplement, replacement, novation or modification made in breach of such document, agreement or this Agreement;
(f) a reference to a Person includes that Person’s successors and permitted assigns;
(g) the term “including” (and its variants) means “including 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; 25 (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, and references to a LMP shall mean the LMP at the Delivery Point unless expressly provided otherwise;
(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”). (b) Reserved.
(c) 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 19 shall remain in full force and effect for three (3) years following the termination of this Agreement, and all indemnity and audit rights shall remain in full force and effect for two (2) years following the termination of this Agreement.
2.2 Conditions Precedent. The Delivery Term shall not commence until Seller completes 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, 26 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 installed and commissioned generating equipment with a nameplate capacity of no less than ninety-five percent (95%) of the Guaranteed PV Capacity; (b) Seller shall have installed and commissioned storage equipment with a capacity of no less than ninety-five percent (95%) of the Guaranteed Storage Capacity; (c) Seller shall have delivered to Buyer certificates from a Licensed Professional Engineer substantially in the form of Exhibits G-1 and G-2; (d) A Participating Generator Agreement between Seller and CAISO shall have been executed and delivered,
(e) An Interconnection Agreement between Seller and the PTO shall have been executed and delivered and be in full force and effect and a copy of the Interconnection Agreement, including all modifications and amendments thereto, delivered to Buyer; (f) Authorization to parallel the Facility was obtained by the Participating Transmission Owner prior to the Commercial Operation Date; (g) The Transmission Provider has provided documentation supporting full unrestricted release for Commercial Operation by the Commercial Operation Date. (h) The Facility has achieved CAISO Commercial Operation. (i) The Facility is providing Resource Adequacy Benefits to Buyer for the month in which Delivery Term commences;
(j) Buyer, or its designee, is the Scheduling Coordinator for the Facility; provided, if this requirement is not met because of Buyer’s (or its designee’s) actions or failure to take actions, and this is the only requirement for Commercial Operation that has not been met, Seller shall be entitled to a day for day extension of the Guaranteed Commercial Operation Date for such Buyer (or its designee) actions or failure to act. (k) Seller shall have delivered to Buyer a copy of all environmental impact reports (i.e. EIRs), studies (i.e. EISs) or assessments (i.e. EIAs) prepared by or obtained by Seller or its Affiliates, the conditional use permit or other principal land use approval for the Facility, and a certificate signed by an authorized representative of Seller stating that Seller is in compliance with the requirements of the conditional use permit or other principal land use approval; (l) Seller has received CEC Precertification;
(m) Seller (with the reasonable participation of Buyer) shall have completed all applicable WREGIS registration requirements
27 including the completion and
submittal of all applicable registration forms and supporting documentation, which may include applicable interconnection agreements, informational surveys related to the Generating Facility, Qualified Reporting Entity service agreements, and other appropriate documentation required to effect Generating Facility registration with WREGIS and to enable Renewable Energy Credit transfers related to the Generating Facility within the WREGIS system; (n) Seller shall have caused the Generating Facility and the Storage Facility to be included in the Full Network Model and has ability to offer Bids into CAISO Day-Ahead Markets and Real-Time Markets in respect of each of the Generating Facility and the Storage Facility;
(o) Seller shall have completed all necessary steps to provide Ancillary Services from the Storage Facility, including completing the certification and testing requirements in Section 8 and Appendix K of the CAISO Tariff;
(p) Seller has delivered to Buyer a copy of the most recent generation resource report (including as prepared by an independent engineer in connection with the financing of the construction or permanent operation of the Facility, and the most up-to-date 8760
hourly generation forecast;
(q) Seller has delivered the Performance Security to Buyer; (r) Seller has paid Buyer for all Daily Delay Damages and Commercial Operation Delay Damages owing under this Agreement, if any; (s) Seller has demonstrated compliance with Section 7.1, including installation of the Storage Facility Meter
(t) Seller has delivered to Buyer a plan that is reasonably acceptable to Buyer for the proper recycling and disposal of all project components, equipment, and materials at the end of the useful life of the Facility.
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 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. (b) Seller shall ensure that all materials, products and components used in constructing, installing and operating the Facility throughout the Contract Term shall be in compliance with the Supply Chain Code. Seller shall
comprehensively implement due diligence procedures for its and its Affiliate’s suppliers, 28 subcontractors and other participants in its supply chains, to comply with the Supply Chain Code.
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).
(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
day after the missed
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), and 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. If the missed Milestone(s) is not the Guaranteed Construction Start Date or the Guaranteed Commercial Operation Date, and so long as Seller complies with its obligations under this Section 2.4, then Seller shall not be considered in default of its obligations under this Agreement as a result of missing such Milestone(s).
2.5 Facility Configuration. The Parties agree that the Facility configuration will be as Co-located Resources with separate CAISO Resource IDs and separate CAISO approved revenue quality meters for each of the Storage Facility and Generating Facility. Seller shall design and configure the Facility metering and equipment (although not necessarily the software associated therewith) to accommodate being able to function in a Co-located Resource configuration ARTICLE 3
PURCHASE AND SALE
3.1 Sale of Product.
(a) Subject to the terms and conditions of this Agreement, during the period (i) if Buyer elects to purchase Test Energy pursuant to Section 3.7(a), commencing upon Initial Synchronization with respect to the Generating Facility and (ii) commencing upon Commercial Operation with respect to the Storage Facility and with respect to the Generating Facility if Buyer does not elect to purchase Test Energy pursuant to Section 3.7(a), and continuing throughout the Delivery Term, Seller shall sell and deliver to Buyer, and Buyer shall purchase and receive from Seller all of the Product produced by the Facility. Buyer shall re-sell all of the Energy purchased hereunder, and may, at its sole discretion, re-sell or use for another purpose all or a portion of the remainder of the Product, provided, such resale or use for another purpose will not relieve Buyer of any of its obligations under this Agreement.
(b) Except for Deemed Delivered Energy, Buyer has no obligation to pay Seller for any Product that is not delivered to the Delivery Point as a result of any circumstance, 29 including, an outage of the Facility, a Force Majeure Event, or a Curtailment Order. In no event shall Seller have the right to procure any element of the Product from sources other than the Facility for sale or delivery to Buyer under this Agreement, except with respect to Replacement RA.
3.2 Sale of Green Attributes. Seller shall sell and deliver to Buyer, and Buyer shall purchase and receive from Seller, all of the Green Attributes produced by the Facility during the Delivery Term, and any Green Attributes associated with Test Energy
3.3 Compensation. Buyer shall compensate Seller for the Product in accordance with this Section 3.3.
(a) Buyer shall pay Seller the Renewable Rate for each MWh of PV Energy that qualifies as PCC1 and is delivered to the Delivery Point, plus Deemed Delivered Energy, if any, up to one hundred ten percent (110%) of the Expected Energy for such Contract Year. (b) If, at any point in any Contract Year following CAISO Commercial Operation, the amount of PV Energy delivered to the Delivery Point plus the amount of Deemed Delivered Energy exceeds one hundred ten percent (110%) of the Expected Energy for such Contract Year, for each additional MWh of PV Energy that qualifies as PCC1 or Deemed Delivered Energy, if any, delivered to the Delivery Point in such Contract Year, the price to be paid shall be .
(c) If during any Settlement Interval, Seller delivers PV Energy in excess of the product of the Installed PV Capacity 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 the number of such Excess MWh (“Negative LMP Costs”).
(d) The price for PV Energy that does not qualify as PCC1 shall be the lesser of (i) the Renewable Rate, or (ii) the Day-Ahead LMP for the applicable Settlement Interval. (e) For the Storage Product, for each month commencing on Commercial Operation and throughout the Delivery Term, Buyer shall pay Seller an amount equal to [(A x B x C) – D], (such amount, the “Storage Capacity Payment”), where:
A = the Storage Rate
B = the current Storage Capacity (in kW)
C = the applicable Storage Availability Adjustment determined in accordance with Exhibit M
D = the applicable RTE Shortfall Payment determined in accordance with Exhibit Q (if applicable)
30 The Storage Capacity Payment constitutes the entirety of the amount due to Seller from Buyer for the Storage Product.
3.4 Imbalance Energy. With respect to the Generating Facility, as a Variable Energy Resource, Buyer and Seller recognize that from time to time the amount of PV Energy will deviate from the amount of Scheduled Energy. Buyer and Seller shall reasonably cooperate to minimize charges and imbalances associated with Imbalance Energy caused by the variances in solar insolation to the extent possible. To the extent there are such deviations, any CAISO costs or revenues assessed as a result of such Imbalance Energy shall be solely for the account of Buyer; provided, (a) with respect to the Generating Facility, to the extent such deviations are the result of any cause other than (i) variances in solar insolation
with respect to any deviations by the Storage Facility from its Schedule (to the extent such Schedule is consistent with the Operating Restrictions), any CAISO costs assessed as a result of such Imbalance Energy shall be solely for the account of Seller, and all CAISO revenue associated with such deviations shall be solely for the account of Buyer. CAISO costs and revenues in connection with RTD Instructed Imbalance Energy shall be for Buyer’s account except to the extent such RTD Instructed Imbalance Energy was the result of a change in the Forecasted Product after the deadline for submitting Schedules in the Day-Ahead Market, in which case the CAISO costs shall be for Seller’s account, and all CAISO revenue associated with such deviations shall be solely for the account of Buyer.
3.5 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.
3.6 Future Environmental Attributes.
(a) The Parties acknowledge and agree that as of the Effective Date, Future Environmental Attributes may be created by a Governmental Authority through Laws enacted after the Effective Date. Buyer shall have the right to obtain such Future Environmental Attributes without any adjustment to the Contract Price paid by Buyer under this Subject to Section 3.6(b) and 3.13, Seller
shall take all reasonable actions necessary to realize the full value of such Future Environmental Attributes for the benefit of Buyer, and shall cooperate with Buyer in Buyer’s efforts to do the same.
(b) If Buyer elects to receive Future Environmental Attributes pursuant to Section 3.6(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
32 (c) Subject to Section 3.13, Seller shall take all commercially reasonable actions, including complying with all applicable registration and reporting requirements, and execute any and all documents or instruments necessary to enable Buyer to use all of the Capacity Attributes committed by Seller to Buyer pursuant to this Agreement. (d) For the duration of the Delivery Term, Seller shall maintain an interconnection capacity under its Interconnection Agreement of at least the amount of the Guaranteed Interconnection Capacity.
(e) Seller shall provide Notice to Buyer not less than fifteen (15) Business Days prior to each Showing Deadline confirming the Net Qualifying Capacity of the Facility and/or any Replacement RA that is able to be shown on Buyer’s monthly or annual RA Plan, as applicable.
Seller shall be solely responsible to provide RA Substitute Capacity in accordance with applicable CAISO requirements in connection with Seller’s Facility outages; provided, Buyer or Buyer’s SC, if applicable, will cooperate to allow Seller to deliver such RA Substitute Capacity to the CAISO.
Seller acknowledges and agrees that any failure by Seller to provide such RA Substitute Capacity may result in CAISO rejecting or cancelling Scheduled Maintenance or other outage of the Storage Facility. Buyer shall notify Seller within after becoming aware of an obligation by Seller to provide RA Substitute Capacity. Upon request by Seller, Buyer shall use commercially reasonable efforts to secure, on Seller’s behalf, RA Substitute Capacity; provided, Seller shall reimburse Buyer for all out-of-pocket costs, including broker and outside counsel costs, associated with such RA Substitute Capacity. If Seller declines to provide RA Substitute Capacity, and notifies Buyer to that effect no less than five (5) Business Days before the applicable Showing Deadline, then Buyer shall not include the Storage Facility (or, if applicable, the portion of the Storage Facility) in its Supply Plan for the Facility and Seller’s sole liability will be payment of the RA Deficiency Amount for such RA Shortfall pursuant to Section 3.9. (f) If Seller anticipates it will have an RA Shortfall in any month of the Delivery Term, Seller may provide Replacement RA up to the anticipated RA Shortfall, provided (i) Seller provides Buyer with Replacement RA product information in a Notice substantially in the form of Exhibit K at least seventy-five (75) days before the applicable Showing Month, and (ii) Replacement RA shall not exceed twenty-five percent (25%) of the Resource Adequacy Benefits provided during any Contract Year;
3.9 Resource Adequacy Failure.
(a) RA Deficiency Determination. Notwithstanding Seller’s obligations set forth in Section 4.3 or anything to the contrary herein, the Parties acknowledge and agree that if 33 during the Delivery Term Seller fails to provide Resource Adequacy Benefits in an amount equal to or greater than the Facility’s Qualifying Capacity as required hereunder, then Seller shall pay to Buyer the RA Deficiency Amount for each RA Shortfall Month as liquidated damages due to Buyer for the Capacity Attributes that Seller failed to convey to Buyer. (b) RA Deficiency Amount Calculation. For each RA Shortfall Month, except as otherwise provided in Section 3.9(a), Seller shall pay to Buyer an amount (the “RA Deficiency Amount”) equal to the sum of:
(i) For any portion of the RA Shortfall for which Buyer incurs a CPUC System RA Penalty (“CPUC-Penalized Shortfall”), the amount of such CPUC System RA Penalty for such month and actually incurred by Buyer (which shall be zero (0) if Buyer does not incur any CPUC System RA Penalty), plus
(ii) For any portion of the RA Shortfall for which Buyer incurs CAISO costs, charges or penalties associated with such shortfall (“CAISO-Penalized Shortfall”), the amount of such CAISO costs, charges or penalties directly resulting from such RA Shortfall for such month and actually incurred by Buyer (which shall be zero (0) if Buyer does not incur any CAISO costs, charges or penalties associated with the RA Shortfall), plus (iii) For any RA Shortfall which is not CPUC-Penalized Shortfall and/or CAISO-Penalized Shortfall, and for which Buyer purchased replacement Resource Adequacy Benefits, the amount of Buyer’s cost of such replacement Resource Adequacy Benefits, plus (iv) For any RA Shortfall which is not CPUC-Penalized Shortfall and/or CAISO-Penalized Shortfall, and for which Buyer did not purchase replacement Resource Adequacy Benefits, t
(c)
3.10 CEC Certification and Verification. Subject to Section 3.13, Seller shall take all necessary steps including, but not limited to, making or supporting timely filings with the CEC to obtain and maintain CEC Precertification and CEC Final Certification and Verification for the Facility. 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 CEC Final 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 CEC Final Certification and Verification. Seller must promptly notify Buyer and the CEC of any changes to the information included in Seller’s application for CEC Precertification or CEC Final Certification and Verification for the Facility.
(b) one hundred eighty (180) days of
the Delivery Term, provided, Seller has obtained and maintained CEC Precertification, Buyer shall pay Seller the Renewable Rate for PV Energy that qualifies as PCC1 and the lower of (i) the Renewable Rate or (ii) the Day-Ahead LMP for PV Energy that does not qualify as PCC1, 34 according to Section 3.3, regardless of whether Seller has obtained CEC Final Certification and Verification. If Seller has not obtained CEC Final Certification and Verification within one hundred eighty (180) days after the Commercial Operation Date, Buyer will compensate Seller for the PV Energy, regardless of PCC1 eligibility, at the lower of (i) the Renewable Rate, as adjusted according to Section 3.3, or (ii) the Day-Ahead LMP, for the remainder of the Delivery Term, or until Seller obtains CEC Final Certification and Verification. If Seller obtains CEC Final Certification and Verification after one hundred eighty (180) days after the Commercial Operation Date, Buyer will thereafter begin paying Seller the Renewable Rate for PV Energy that qualifies as PCC1 according to Section 3.3, and, if such CEC Final Certification and Verification relates back to all Energy delivered by Seller during the Delivery Term, will reimburse Seller for the difference between (x) any reduced amounts paid to Seller for PV Energy under this Section 3.10 due to Seller’s failure to obtain CEC Final Certification and Verification within one hundred eighty (180) days after the Commercial Operation Date, and (y) the amount that would have been paid to Seller had Seller timely obtained CEC Final Certification and Verification within one hundred eighty (180) days after the Commercial Operation Date. If Seller has not obtained CEC Final Certification and Verification within one (1) year of the Commercial Operation Date, then an Event of Default shall occur, Buyer shall have all remedies available under this Agreement, including under Section 11.2, and, in the event that Buyer terminates this Agreement under Section 11.2, Seller shall reimburse Buyer, in addition to any other amounts owed, in an amount equal to the difference between (a) the amount paid by Buyer to Seller for PV Energy during the first one hundred eighty (180) days of the Delivery Term, and (b) the amount that would have been paid if the price for energy delivered during the first one hundred eighty (180) days of the Delivery Term were the Day-Ahead LMP.
3.11 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]
3.12 California Renewables Portfolio Standard. Subject to Section 3.13, Seller shall also take all other actions necessary to ensure that the Energy produced from the Generating Facility is tracked for purposes of satisfying the California Renewables Portfolio Standard requirements, as may be amended or supplemented by California statute or by the CPUC or CEC from time to time.
3.13 Compliance Expenditure Cap. If Seller establishes to Buyer’s reasonable satisfaction that a change in Law occurs after the Effective Date that has resulted in, or given rise to, an increase in Seller’s known or reasonably expected costs and expenses to comply with Seller’s obligations under the Agreement with respect to obtaining, maintaining, conveying or effectuating Buyer’s use of (as applicable), the items listed in Sections 3.13(a), (b), (c), and (d) (not including any RA Deficiency Amounts), then the Parties agree that the maximum aggregate amount of costs and expenses Seller shall be required to bear during the Delivery Term shall be capped at Twenty 35 Five Thousand Dollars ($25,000.00) per MW of Guaranteed Storage Capacity cumulatively during the Delivery Term (“Compliance Expenditure Cap”):
(a) CEC Certification and Verification;
(b) Green Attributes; and
(c) Capacity Attributes.
Any actions required for Seller to comply with its obligations set forth in the first paragraph above, the cost of which will be credited to the Compliance Expenditure Cap, shall be referred to collectively as the “Compliance Actions”.
If Seller reasonably anticipates the need to incur out-of-pocket expenses in excess of the Compliance Expenditure Cap in order to take any Compliance Action, Seller shall provide Notice to Buyer of such anticipated out-of-pocket expenses.
Buyer will have sixty (60) days to evaluate such Notice (during which time period Seller is not obligated to take any Compliance Actions described in the Notice) and shall, within such time, either (1) agree to reimburse Seller for all 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 3.13 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.
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 reasonable documentation of such costs from Seller.
The term “commercially reasonable efforts” as used in Sections 3.11 and 4.8(h) means efforts consistent with and subject to this Section 3.13.
36 3.14 Guaranteed Interconnection Capacity. Seller shall enable the Aggregate Capability Constraint and sub-Aggregate Capability Constraints with CAISO so as to ensure that the Buyer has the exclusive right to use the Guaranteed Interconnection Capacity.
3.15 CPUC Mid-Term Reliability Requirements. The Parties acknowledge that Buyer is entering into this Agreement to satisfy a portion of its obligations to procure capacity to meet mid-term reliability requirements specified by the CPUC in CPUC Decision (“D.”) 21-06-035, D.23-02-040, and related CPUC orders and decisions (“MTR Requirements”) as a generic resource (and not for any sub-category of D.21-06-035). Seller represents and warrants to Buyer that:
(a) During the Delivery Term, the Product includes the exclusive right to claim the Capacity Attributes of the Storage Facility as an incremental generic resource for purposes of CPUC Decision 21-06-035 and other MTR Requirements (“MTR Attributes”); (b) Seller has not and will not sell, assign or transfer the right to claim procurement of the Capacity Attributes of the Storage Facility as an incremental resource for purposes of CPUC Decision 21-06-035 and other MTR Requirements to any other person or entity during the Delivery Term; and
(c) Seller will provide to Buyer additional information and documentation reasonably available to Seller on a commercially reasonable basis if necessary to enable Buyer to demonstrate that the Product meets the procurement mandates set forth in the MTR Requirements
3.16 Buyer’s Re-Sale of Product. Buyer shall have the exclusive right in its sole discretion to convey, use, market, or sell the Product, or any part of the Product, to any Subsequent Purchaser; and Buyer shall have the right to all revenues generated from the conveyance, use, re-sale or remarketing of the Product, or any part of the Product. If the CAISO or CPUC develops a centralized capacity market, Buyer shall have the exclusive right to offer, bid, or otherwise submit the Capacity Attributes for re-sale into such market, and Buyer shall retain and receive all revenues from such re-sale. Seller shall take all commercially reasonable actions and execute all documents or instruments reasonably necessary to allow Subsequent Purchasers to use such resold Product, but without increasing Seller’s obligations or liabilities under this Agreement. If Buyer incurs any liability to a Subsequent Purchaser due to the failure of Seller to comply with this Section 3.16, Seller shall be liable to Buyer for the amounts Seller would have owed Buyer under this Agreement if Buyer had not resold the Product.
ARTICLE 4
OBLIGATIONS AND DELIVERIES
4.1 Delivery.
(a) Energy. Subject to the terms and conditions of this Agreement, Seller shall make available and Buyer shall accept at the Delivery Point all Product. Each Party shall perform all obligations under this Agreement, including all generation, scheduling, and transmission 37 services in compliance with (i) the CAISO Tariff, (ii) WECC scheduling practices, and (iii) Prudent Operating Practice.
(b) Green Attributes. Seller hereby provides and conveys all Green Attributes associated with the Facility during the Delivery Term as part of the Product being delivered. 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 during the Delivery Term. Upon request of Buyer, Seller shall submit a Green-e® Energy Tracking Attestation Form (“Attestation”) for Product delivered under this Agreement to the Center for Resource Solutions (“CRS”) at https://www.tfaforms.com/4652008 or its successor. The Attestation shall be submitted in accordance with the requirements of CRS and shall be submitted within thirty (30) days of Buyer’s request or the last day of the month in which the applicable Energy was generated, whichever is later.
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. Title to and risk of loss related to the Charging Energy, if any, shall pass and transfer from Buyer to Seller at the Storage Facility Meter. (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 Scheduling Coordinator Responsibilities.
(a) Scheduling Coordinator for the Facility. Prior to Commercial Operation, Seller 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 the Product at the Delivery Point. Upon Commercial Operation, 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 the Product at the Delivery Point. At least thirty (30) days prior to the anticipated date of Commercial Operation, (i) Seller shall take all actions and execute and deliver to Buyer and the CAISO all documents necessary to authorize or designate Buyer as the Facility’s Scheduling Coordinator effective as of Commercial Operation, 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 Commercial Operation. On and after Commercial Operation, Seller shall not authorize or designate any other party to act as the Facility’s Scheduling Coordinator, nor shall Seller perform for its own benefit the duties of Scheduling Coordinator, and Seller shall not revoke Buyer’s authorization to act as the Facility’s Scheduling Coordinator unless agreed to by Buyer. Buyer (as the Facility’s SC) shall submit Schedules to the CAISO in accordance with this Agreement and the applicable CAISO Tariff, protocols and Scheduling practices,
for Product or load, as applicable, on a day-ahead,
hour-ahead, fifteen-minute market or real time basis, as determined by Buyer. 38 (b) Notices. Following Commercial Operation, 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 Facility Outages, Forced Facility Outage reports, clearance requests, or must offer waiver forms. Seller will cooperate with Buyer to provide such notices and updates. If the web-based system is not available, Seller shall promptly submit such information to Buyer and the CAISO (in order of preference) telephonically, by electronic mail, or facsimile transmission to the personnel designated to receive such information. (c) CAISO Costs and Revenues. Following Commercial Operation and except as otherwise set forth below and in Sections 3.4 and 3.7, 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, except as otherwise provided in this Agreement), including revenues associated with CAISO dispatches, bid cost recovery, Inter-SC Trade credits, or other credits in respect of the Product Scheduled or delivered from the Facility.
Seller shall be responsible for all CAISO penalties or fees (including costs associated with Imbalance Energy, as set forth in Section 3.4, and CAISO No Pays) resulting from any failure by Seller to abide by the CAISO Tariff or 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 following Commercial Operation). The Parties agree that any Availability Incentive Payments are for the benefit of the Seller and for Seller’s account and that any Non-Availability Charges are the responsibility of the Seller and for Seller’s account (except to the extent any Non-Availability Charges are incurred due to Buyer’s failure to perform its duties as Scheduling Coordinator for the Facility). In addition, if after Commercial Operation, 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 the
(d) CAISO Settlements. Buyer (as the Facility’s SC) shall be responsible for all settlement functions with the CAISO related to the Facility after Commercial Operation. Buyer shall render a separate invoice to Seller for any CAISO charges or penalties (“CAISO Charges Invoice”) for which Seller is responsible under this Agreement, including Section 3.4, which shall be offset with any charges or penalties for which Buyer is responsible. CAISO Charges Invoices shall be rendered after settlement information becomes available from the CAISO that identifies any CAISO charges. Notwithstanding the foregoing, Seller acknowledges that the CAISO will issue additional invoices reflecting CAISO adjustments to such CAISO charges . Buyer will
review, validate, and if requested by Seller under Section 4.3(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 undisputed CAISO Charges Invoices within ten (10) Business Days of Seller’s receipt of the CAISO Charges Invoice. If Seller fails to pay such undisputed CAISO Charges Invoice 39 within that period, Buyer may net or offset any amounts owing to it for these CAISO Charges Invoices against any future amounts it may owe to Seller under this Agreement. The obligations under this section with respect to payment of CAISO Charges Invoices shall survive the expiration or termination of this Agreement.
(e) Dispute Costs. Buyer (as the Facility’s SC) may be required by Seller to dispute CAISO settlements in respect of the Facility following Commercial Operation. Seller agrees to pay Buyer’s costs and expenses (including reasonable attorneys’ fees) associated with its involvement with such CAISO disputes to the extent they relate to CAISO charges payable by Seller with respect to the Facility that Seller has directed Buyer to dispute. (f) Terminating Buyer’s Designation as Scheduling Coordinator. At least thirty (30) days prior to expiration of this Agreement or as soon as reasonably practicable upon an earlier termination of this Agreement, the Parties will take all actions necessary to terminate the designation of Buyer as Scheduling Coordinator for the Facility as of 11:59 p.m. on such expiration date.
(g) Master Data File and Resource Data Template. Seller shall provide the data to the CAISO (and to Buyer) that is required for the CAISO’s Master Data File and Resource Data Template (or successor data systems) for this Facility consistent with this Agreement. Neither Party shall change such data without the other Party’s prior written consent, not to be unreasonably withheld.
(h) NERC Reliability Standards. Following Commercial Operation, 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.
40 4.4 Forecasting. Seller shall provide the forecasts described below. Seller’s (i) Available Generating Capacity, (ii) Available Storage Capacity, and (iii) Available Storage Capability forecasts (items (i), (ii), and (iii) collectively referred to as the “Forecasted Product”) shall include availability and updated status of key equipment for the Facility. Seller shall use commercially reasonable efforts to forecast the Forecasted Product and expected PV Energy of the Facility accurately and to transmit such information in a format reasonably acceptable to Buyer (or Buyer’s designee).
(a) Annual Forecast of Monthly Expected PV Energy. No less than ninety (90) 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 a non-binding forecast of monthly expected PV Energy, by hour, for the following calendar year in the form attached hereto as Exhibit L-1 or as reasonably requested by Buyer.
(b) Monthly Forecast of Available Generating Capacity, Available Storage Capacity, and Available Storage Capability. No less than thirty (30) days before CAISO Commercial Operation, and thereafter ten (10) Business Days before the beginning of each month during the Delivery Term, Seller shall provide to Buyer and Buyer’s designee (if applicable) a non-binding forecast of the hourly Forecasted Product, and expected PV Energy, for each day of the following month in the forms attached hereto as Exhibits L-2, L-3 and L-4, respectively, or as reasonably requested by Buyer.
(c) Daily Forecast. By 5:30 AM Pacific Prevailing Time on the Business Day immediately preceding the date of delivery, Seller shall provide Buyer with a non-binding forecast of the Forecasted Product for each hour of the immediately succeeding day (“Day-Ahead Forecast”). A Day-Ahead Forecast provided in a day prior to any non-Business Day(s) shall include non-binding forecasts for the immediate day, each succeeding non-Business Day and the 41 next Business Day. Each Day-Ahead Forecast shall clearly identify, for each hour, Seller’s best estimate of the Available Generating Capacity (or if requested by Buyer, the monthly expected PV Energy), Available Storage Capacity, and Available Storage Capability. (d) Real-Time Forecast. During the period commencing upon CAISO Commercial Operation and continuing throughout the Delivery Term, Seller shall notify Buyer of any changes in Forecasted Product of one (1) MW or MWh or more, whether due to 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 Notices shall contain information regarding the beginning date and time of the event resulting in the change in Available Generating Capacity, Available Storage Capacity, and/or Available Storage Capability, as applicable, the expected end date and time of such event, the expected Available Generating Capacity, Available Storage Capacity, and/or Available Storage Capability, as applicable, in MW, 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. These Notices and changes to Available Generating Capacity, Available Storage Capacity, and/or Available Storage Capability shall be communicated in a method acceptable to Buyer; provided, 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 a acceptable method for communications under this Section 4.4(d), then Seller shall send such communications by telephone and e-mail to Buyer.
4.5 Dispatch Down/Curtailment.
(a) General. Seller agrees to reduce the Generating Facility’s generation 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. Buyer has no obligation to purchase or pay for any Product delivered in violation of any Curtailment Order, Buyer Curtailment Order, or notice received from CAISO in respect of a Buyer Bid Curtailment, or for any Product that could not be delivered to the Delivery Point due to a Force Majeure Event. (b) Buyer Curtailment. Buyer shall have the right to order Seller to curtail deliveries of PV Energy or Discharging Energy to the Delivery Point pursuant to a Buyer Curtailment Order or Buyer Bid Curtailment, provided, Buyer shall pay Seller for all Deemed Delivered Energy associated with all Buyer Curtailment Periods at the applicable 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 to the Delivery Point in contradiction to 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 42 of such MWh and, (B) is an amount equal to the absolute value of the Negative LMP, if any, for the Buyer Curtailment Period or Curtailment Period, times the amount of MWh of Facility Energy delivered to the Delivery Point in contradiction to the Buyer Curtailment Order, Buyer Bid Curtailment or Curtailment Order, and (C) is any penalties or other charges 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 period commencing upon CAISO Commercial Operation and continuing throughout the Delivery Term, Seller’s facilities, communications links or other equipment, protocols or practices are not in compliance with methodologies applicable to the Facility as required by CAISO, Seller shall take the steps necessary to become compliant as soon as commercially reasonably possible. Seller promptly repair and
replace as necessary such facilities, communication links or other equipment, and shall notify Buyer as soon as Seller discovers any defect. If Buyer notifies Seller of the need for maintenance, repair, or replacement of any such facilities, communication links or other equipment, Seller shall repair or replace such equipment as necessary within five (5) days of receipt of such Notice; provided, if Seller is unable to do so, then Seller shall make such repair or replacement as soon as reasonably practical. Seller shall be liable pursuant to Section 4.5(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 the CAISO Tariff. 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.
4.6 Charging and Discharging Energy.
(a) Commencing on the Commercial Operation Date, Buyer will be the Scheduling Coordinator for the Storage Facility and will have sole and exclusive rights to instruct Seller to charge and discharge the Storage Facility by issuing Charging Notices and Discharging Notices to Seller and to bid and schedule the Storage Facility in CAISO markets, subject to the terms of this Agreement, including the Operating Restrictions. (b) Seller shall comply with Charging Notices and Discharging Notices that comply with the terms of this Agreement. Upon receipt of a valid Charging Notice, Seller shall accept the Charging Energy at the Storage Facility in accordance with the terms of this Agreement 43 (including the Operating Restrictions), at the times and in the quantities specified in such Charging Notice. Upon receipt of a valid Discharging Notice, Seller shall deliver the Discharging Energy to the Delivery Point in accordance with the terms of this Agreement (including the Operating Restrictions), at the times and in the quantities specified in such Discharging Notice. (c) Buyer will have the right to instruct charges of the Storage Facility seven (7) days per week and twenty-four (24) hours per day (including holidays), by providing Charging Notices to Seller electronically, provided, Buyer’s right to issue Charging Notices is subject to the requirements and limitations set forth in the CAISO Tariff, other applicable Laws, and this Agreement, including the Operating Restrictions. Each Charging Notice issued in accordance with this Agreement will be effective unless and until Buyer modifies such Charging Notice by providing Seller with an updated Charging Notice.
(d) Seller shall not charge the Storage Facility during the Contract Term other than pursuant to a valid Charging Notice or in connection with a Storage Capacity Test (for which Seller may request a Charging Notice from Buyer), or pursuant to a notice from CAISO, the PTO, or any other Governmental Authority. If, during the Contract Term, Seller (i) charges the Storage Facility to a Stored Energy Level greater than the Stored Energy Level provided for in the Charging Notice (except as permitted in the first sentence of this Section 4.6(d)), or (ii) charges the Storage Facility in violation of the first or second sentence of Section 4.6(b), then, in addition to any other costs and charges for which Seller is responsible, including Imbalance Energy costs and other amounts specified in Section 4.3(c), and without limiting any of Buyer’s other rights under this Agreement:
(i) Seller shall be responsible for all Energy costs associated with such charging of the Storage Facility; and
(ii) the Monthly Storage Availability calculation shall be affected to the extent specified in Exhibit M.
(e) Subject to compliance with the CAISO Tariff, other applicable Laws and the Operating Restrictions, Buyer will have the right to instruct discharges of the Storage Facility seven (7) days per week and twenty-four (24) hours per day (including holidays), by providing Discharging Notices to Seller electronically and subject to the requirements and limitations set forth in this Agreement, including the Operating Restrictions. Each Discharging Notice issued in accordance with this Agreement will be effective unless and until Buyer modifies such Discharging Notice by providing Seller with an updated Discharging Notice. (f) Seller shall not discharge the Storage Facility during the period commencing upon Commercial Operation and continuing throughout the Delivery Term other than pursuant to a valid Discharging Notice or in connection with a Storage Capacity Test (for which Seller may request a Charging Notice from Buyer), or pursuant to a notice from CAISO, the PTO, or any other Governmental Authority. Discharging for Station Use may occur only as specified in Section 6.4. In the case of a Storage Capacity Test, Buyer shall pay for costs associated with the Charging Energy and may retain any revenue from the discharge of such Energy (adjusted for efficiency losses) pursuant to a valid Discharging Notice; provided, Seller shall pay the costs associated with the Charging Energy if (i) Seller initiates the tests in accordance with Exhibit N 44 or (ii) a Buyer-initiated test indicates that the Storage Capacity is two percent (2%) or more lower than the then-current Storage Capacity. If, during the Contract Term, Seller (i) discharges the Storage Facility to a Stored Energy Level less than the Stored Energy Level provided for in the Discharging Notice (except as permitted in the first or second sentence of this Section 4.6(f)), or (ii) discharges the Storage Facility in violation of the first or second sentence of this Section 4.6(f), then, in addition to any other costs and charges for which Seller is responsible, including Imbalance Energy costs and other amounts specified in Section 4.3(c), and without limiting any of Buyer’s other rights under this Agreement:
(i) Buyer shall retain any positive revenues received from CAISO or otherwise associated with such discharge;
(ii) Seller shall be responsible for and reimburse Buyer for all Energy costs associated with charging the Storage Facility to the Stored Energy Level specified by Buyer before the discharge; and
(iii) the Monthly Storage Availability calculation shall be affected to the extent specified in Exhibit M.
(g) Notwithstanding anything in this Agreement to the contrary, during any Settlement Interval, Curtailment Orders, Buyer Curtailment Orders, and Buyer Bid Curtailments applicable to such Settlement Interval shall have priority over any Discharging Notices applicable to such Settlement Interval (but not over Charging Notices which are consistent with such Curtailment Orders, Buyer Curtailment Orders, or Buyer Bid Curtailments), and Seller shall have no liability for violation of this Section 4.6 or any Discharging Notice if and to the extent such violation is caused by Seller’s compliance with any Curtailment Order, Buyer Curtailment Order, Buyer Bid Curtailment, or other instruction or direction from a Governmental Authority or the PTO unless caused by Seller’s fault or negligence. Buyer shall have the right, but not the obligation, to provide Seller with updated Charging Notices and Discharging Notices during any Buyer Curtailment Order, Buyer Bid Curtailment, or Curtailment Order consistent with the Operating
Restrictions.
(h) Prior to Commercial Operation, (i) Buyer shall have no rights to issue or cause to be issued Charging Notices or Discharging Notices, (ii) Seller shall have exclusive rights to charge and discharge the Storage Facility (provided, Seller shall only charge and discharge the Storage Facility in connection with installation, commissioning and testing of the Storage Facility, and, commencing upon CAISO Commercial Operation, subject to the Operating Restrictions), (iii) all CAISO costs, revenues, penalties and other amounts owing to or paid by CAISO in respect of the Storage Facility testing shall be for Seller’s account. Upon Commercial Operation, Buyer shall have exclusive rights to issue or cause to be issued Charging Notices or Discharging Notices.
4.7 [
4.8 Expected Energy and Guaranteed Energy Production. The quantity of PV Energy that Seller expects to be able to deliver to Buyer at the Delivery Point during each Contract 45 Year is set forth on the Cover Sheet (“Expected Energy”). Seller shall be required to deliver to Buyer at the Delivery Point an amount of PV Energy, not including any Excess MWh, equal to no less than the Guaranteed Energy Production (as defined below) in each Contract Year period during the Delivery Term,
(“Performance Measurement Period”). “Guaranteed Energy Production” means an amount of PV Energy, as measured in MWh, equal to the Expected Energy for the constituting such Performance Measurement Period. Seller shall be excused from achieving the Guaranteed Energy Production during any Performance Measurement Period only to the extent that Seller was unable to deliver PV Energy as a result of any Force Majeure Events, Buyer Default, Curtailment Periods and Buyer Curtailment Periods; to effectuate the foregoing excuse, Seller shall be deemed to have delivered to Buyer (a) the Deemed Delivered Energy in respect of Buyer Curtailment Periods, and (b) an amount of Energy determined in accordance with Exhibit D in respect of 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 D.
4.9 WREGIS. Seller shall, at its sole expense, but subject to Section 3.13, 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 PV Energy are issued and tracked for purposes of satisfying the requirements of the California Renewables Portfolio Standard 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, issuance, and transfer of such WREGIS Certificates to Buyer, and Buyer shall be given sole title to all such WREGIS Certificates. In addition:
(a) Prior to the Commercial Operation Date, Seller shall register the Facility with WREGIS and establish an account with WREGIS (“Seller’s WREGIS Account”), which Seller shall maintain until the end of the Delivery Term. Seller shall transfer the WREGIS Certificates using “Forward Certificate Transfers” (as described in the WREGIS Operating Rules) from Seller’s WREGIS Account to the WREGIS account(s) of Buyer or the accounts 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 itself or its agent to be designated as the Qualified Reporting Entity for the Facility. Seller shall cause Forward Certificate Transfers to occur on a monthly basis in accordance with the certification procedure established by the WREGIS Operating Rules. Since WREGIS Certificates will only be created for whole MWh amounts of Energy generated, any fractional MWh amounts (i.e., kWh) will be carried forward until sufficient generation is accumulated for 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 PV Energy for such calendar month as evidenced by data produced by the Generating Facility Meter.
46 (d) Due to the timing of creation of WREGIS Certificates relative to the timing of invoice payment under Section 8.2, Buyer shall make an invoice payment for a given month in accordance with Section 8.2 before the WREGIS Certificates for such month are formally transferred to Buyer in accordance with the WREGIS Operating Rules and this Section 4.9.
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 issued to Buyer for a calendar month as compared to the PV Energy for the same calendar month (“Deficient Month”). If any WREGIS Certificate Deficit occurs, then the amount of PV Energy in the Deficient Month shall be reduced by the amount of the WREGIS Certificate Deficit for purposes of calculating Buyer’s payment to Seller under Article 8 and the Guaranteed Energy Production for the applicable Performance Measurement Period; provided, Buyer shall pay Seller for any PV Energy that is delivered by Seller without corresponding WREGIS Certificates at a price equal to the lesser of (i) the Renewable Rate, or (ii) the weighted average Day-Ahead LMPs for the PV Energy delivered in the corresponding month. Without limiting Seller’s obligations under this Section 4.9, 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. Seller shall use commercially reasonable efforts to rectify any WREGIS Certificate Deficit as expeditiously as possible.
(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 4.9 after the Effective Date, the Parties promptly shall modify this Section 4.9 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 PV Energy in the same calendar month. (g) STC REC-2. 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. (h) STC REC-1. Transfer of Renewable Energy Credits. 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.
4.10 Financial Statements. Seller shall provide to Buyer, within one hundred twenty (120) days of the end of Seller’s fiscal year or as soon as reasonably practicable following Buyer’s request, unaudited quarterly and annual audited financial statements (including a balance sheet and statements of income and cash flows) of Seller (if available) or an upstream Affiliate which 47 consolidates Seller’s financial information in its financial statements, all prepared in accordance with generally accepted accounting principles in the United States, consistently applied.
4.11 Access to Data and Installation and Maintenance of Weather Station. (a) Commencing on CAISO Commercial Operation, and continuing throughout the Delivery Term, Seller shall provide to Buyer, in a form reasonably acceptable to Buyer, the data set forth below on a real-time basis
; provided, Seller shall agree to make and bear the cost of changes to any of the data delivery provisions below, as requested by Buyer, following CAISO Commercial Operation and continuing throughout the Delivery Term, which changes Buyer determines are necessary to forecast output from the Facility, and comply with Law:
(i) real time, read-only access to meteorological measurements, transformer availability, any other facility availability information, and, if applicable, all parameters necessary for use in the equation under item (vii) of this list; (ii) real time, read-only access to PV Energy, EMS data, including Charging Energy, Discharging Energy, Facility Energy, Storage Facility state-of-charge, and battery rack and inverter status (online or offline) information, and meteorological measurements collected by SCADA system for the Facility; provided, if Buyer is unable to access the Facility’s SCADA system, then upon written request from Buyer, Seller shall provide such information and meteorological measurements to Buyer in 1 minute intervals in the form of a flat file to Buyer through a secure file transport protocol (FTP) system with an e-mail back up for each flat file submittal;
(iii) read-only access to the Generating Facility Meter and the Storage Facility Meter, and all Facility meter data at the Site; (iv) full, real time access to the Facility’s Scheduling and Logging for the CAISO (OMS) client application, or its successor system; (vi) net plant electrical output at the CAISO revenue meter; (vii) instantaneous data measurements at sixty (60) second or increased frequency for the following parameters, which measurements shall be provided by Seller to Buyer in a consolidated data report at least once every five minutes via flat file through a secure file transport protocol (FTP) system with an e-mail backup: (i) back panel temperature (ii) global horizontal irradiance, (iii) plane of array irradiance (if the panels are fixed) or direct normal irradiance (if the panels are tracking), (iv) ambient air temperature, (viii) dewpoint air temperature or relative humidity, (ix) horizontal visibility, (x) precipitation (rain rate), (xi) precipitation (running 30 day total), and (xii) barometric pressure; and (viii) an equation, updated on an ongoing basis to reflect the potential generation of the Facility as a function of insolation (and, if applicable, other weather factors).
Such equation shall take into account the expected availability of the Facility. Seller shall reasonably cooperate with any request from Buyer to adjust the equation due to results that are inconsistent with the observed Facility output.
48 For any month in which the above information and access was not available to Buyer for longer than twenty-four (24) continuous hours, Seller shall prepare and provide to Buyer upon Buyer’s request a report with the Facility’s monthly actual Available Generating Capacity and/or Available Storage Capacity in a form reasonably acceptable to Buyer. (b) Seller shall maintain at least a minimum of one hundred twenty (120) days’ historical data for all data required pursuant to Section 4.11, which shall be available on a minimum time interval of one hour basis or an hourly average basis, except with respect to the meteorological measurements which shall be available on a minimum time interval of ten (10) minute basis. Seller shall provide such data to Buyer within five (5) Business Days of Buyer’s request. (c) Installation, Maintenance and Repair.
(i) Seller, at its own expense, shall install and maintain at least one (1) stand-alone meteorological station at the Site to monitor and report the meteorological data required in Section 4.11(a) of this Agreement. Seller, at its own expense, shall install and maintain a secure communication link in order to provide Buyer with access to the data required in Section
4.11(a) of this Agreement.
(ii) Seller shall maintain the meteorological stations, telecommunications path, hardware, and software necessary to provide accurate data to Buyer or Buyer’s designee to enable Buyer to meet current CAISO scheduling requirements. Seller shall u promptly repair and replace as necessary such
meteorological stations, telecommunications path, hardware and software and shall notify Buyer as soon as Seller learns that any such telecommunications paths, hardware and software are providing faulty or incorrect data.
(iii) If Buyer notifies Seller of the need for maintenance, repair or replacement of the meteorological stations, telecommunications path, hardware or software, Seller shall maintain, repair or replace such equipment as necessary within five (5) days of receipt of such Notice; provided, if Seller is unable to repair or replace such equipment within five (5) days, then Seller shall make such repair or replacement as soon as reasonably practical; provided further, Seller shall not be relieved from liability for any Imbalance Energy costs incurred under Section
3.4 during this additional period for repair or replacement. (iv) For any occurrence in which Seller’s telecommunications system is not available or does not provide quality data and Buyer notifies Seller of the deficiency or Seller becomes aware of the occurrence, Seller shall transmit data to Buyer through any alternate means of verbal or written communication, including cellular communications from onsite personnel, facsimile, blackberry or equivalent mobile e-mail, or other method mutually agreed upon by the Parties, until the telecommunications link is re-established. (d) Seller agrees and acknowledges that Buyer may seek and obtain from third parties any information relevant to its duties as Scheduling Coordinator for the Facility, including from the Participating Transmission Operator. Seller shall execute within a commercially reasonable timeframe upon request such instruments as are reasonable and necessary to enable Buyer to obtain from the Participating Transmission Operator information concerning Seller and 49 the Facility that may be necessary or useful to Buyer in furtherance of Buyer’s duties as Scheduling Coordinator for the Facility.
(e) No later than ninety (90) days before the Commercial Operation Date, Seller shall provide one (1) year, if available, but no less than six (6) months, of recorded meteorological data to Buyer in a form reasonably acceptable to Buyer from a weather station at the Site. Such weather station shall provide, via remote access to Buyer, all data relating to (i) the parameters (other than back panel temperature) identified in Section 4.11(a)(vi) above (all data, except peak values, should be 1-second samples averaged into 10-minute periods); (ii) elevation, latitude and longitude of the weather station; and (iii) any other data reasonably requested by Buyer.
4.12 Storage Availability and Efficiency.
(a) Storage Availability. During the Delivery Term, the Storage Facility shall maintain a Monthly Storage Availability (calculated in accordance with Exhibit M) of no less than Guaranteed Storage Availability. If, in any month after Commercial Operation, the Monthly Storage Availability is less than the Guaranteed Storage Availability, then, except as provided in Section 11.1(b)(vi), Buyer’s sole and exclusive remedy for such shortfall shall be the application of the Storage Availability Adjustment to reduce the Storage Capacity Payment due for the Storage Product as provided in Section 3.3(e).
(b) Round-Trip Efficiency. During each month of the Delivery Term, the Storage Facility shall maintain a Round-Trip Efficiency of no less than the Guaranteed Round-Trip Efficiency. If, in any month during the Delivery Term, the Round-Trip Efficiency is less than the Guaranteed Round-Trip Efficiency, then, except as provided in Section 11.1(b)(vii), Buyer’s sole and exclusive remedy (and Seller’s sole and exclusive liability) for such shortfall shall be the RTE Shortfall Payment calculated in accordance with Exhibit Q.
4.13 Storage Capacity Tests.
(a) Prior to the Commercial Operation Date, Seller shall schedule and complete a Commercial Operation Storage Capacity Test in accordance with Exhibit N. Thereafter, Seller and Buyer shall have the right to conduct additional Storage Capacity Tests in accordance with Exhibit N.
(b) Buyer shall have the right to send one or more representatives to witness all Storage Capacity Tests. Buyer shall be responsible for all costs, expenses and fees payable or reimbursable to its representatives witnessing any Storage Capacity Test. (c) Following each Storage Capacity Test, Seller shall submit a testing report in accordance with Exhibit N. If the actual capacity determined pursuant to a Storage Capacity Test deviates from the then current Storage Capacity, then the actual capacity determined pursuant to a Storage Capacity Test (up to, but not in excess of, the Guaranteed Storage Capacity) shall become the new Storage Capacity, effective as of the first day following the completion of the Storage Capacity Test, for all purposes under this Agreement, including compensation under Section 3.3(e) until the next such Storage Capacity Test. 50 4.14 Storage Facility Modifications. Seller shall not modify or supplement all or any part of the Storage Facility,
, without Buyer’s prior written consent, which consent
shall be not be unreasonably withheld, conditioned or delayed.
4.15 Ancillary Services. Buyer shall have the exclusive rights to all Ancillary Services that the Storage Facility is capable of providing consistent with the Operating Restrictions, with characteristics and quantities determined in accordance with the CAISO Tariff. Seller shall operate and maintain the Storage Facility throughout the Contract Term so as to be able to provide such Ancillary Services in accordance with the specifications set forth in the Facility’s initial CAISO Certification associated with the Installed Storage Capacity. If the Storage Facility fails, or is unable, to provide Ancillary Services for any reason (including by reason of failing an Ancillary Services certification test) that is not excused hereunder, then as exclusive remedies the Available Storage Capacity for any applicable Calculation Interval shall be deemed reduced for purposes of calculating the Monthly Storage Availability by an amount equal to the product of (a) the Available Storage Capacity multiplied by (b) , and Seller shall also reimburse Buyer for any CAISO charges or penalties arising from the failure to provide such Ancillary Services. Upon Buyer’s reasonable request, Seller shall submit the Storage Facility for additional CAISO Certification so that the Storage Facility may provide additional Ancillary Services that the Storage Facility is, at the relevant time, actually physically capable of providing consistent with the definition of Ancillary Services herein and without modification of the Storage Facility, provided, Buyer has agreed to reimburse Seller for any costs Seller incurs in connection with conducting such additional CAISO Certification.
4.16 Workforce Agreement. The Parties acknowledge that in connection with Buyer’s 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, 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 4.16.
4.17 Diverse Business Enterprises. During the Delivery Term, no later than twenty (20) days after each semi-annual period ending on June 30th or December 31st, Seller shall provide to Buyer a report listing all Diverse Business Enterprises that supplied goods or services to Seller during such period, including (i) any certifications or other documentation of such Diverse Business Enterprises status as such, (ii) the business address and other contact information of such Diverse Business Enterprises, (iii) the aggregate amount paid to Diverse Business Enterprises during such period and (iv) any other information Buyer reasonably determines is necessary to meet its related reporting obligations.
(a) Buyer has the right to disclose to the CPUC all such information provided by Seller pursuant to this Section 4.17.
51 (b) Seller shall make reasonable efforts to accommodate requests by the CPUC (or by Buyer in response to a request by the CPUC) to audit Seller in order to verify data provided by Seller pursuant to this Section 4.17.
4.18 Shared Facilities. The Parties acknowledge and agree that certain of the Shared Facilities may be subject to shared facilities and/or co-tenancy agreements entered into among Seller, the Transmission Provider, Seller’s Affiliates, and/or third parties. If applicable, Seller agrees that any agreements regarding Shared Facilities (i) shall permit Seller to perform or satisfy, and shall not purport to limit, Seller’s obligations hereunder, (ii) shall provide for separate metering of the Facility, (iii) shall not limit Buyer’s ability to provide Charging Notices and Discharging Notices up to the full Storage Capacity, (iv) shall 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) shall provide that any curtailment or restriction of Shared Facility capacity not attributable to a specific project or projects shall be allocated to all generating or storage facilities utilizing the Shared Facilities based on their pro rata allocation of the Shared Facility capacity prior to such curtailment or reduction Seller shall not, and shall not permit
any Affiliate to, allocate to other Persons 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.
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 delivery or making available to Buyer, including on Energy prior to the Delivery Point. 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 from the Delivery Point (other than withholding or other Taxes imposed on Seller’s income, revenue, receipts or employees). Seller shall be solely responsible for all taxes, charges or fees imposed on the Facility or Seller by a Governmental Authority for Greenhouse Gas emitted by or attributable to the Facility during the Contract Term, but expressly excluding any taxes, charges or fees related to Greenhouse Gases imposed on Charging Energy or Discharging Energy. 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 Energy or other Product hereunder is exempt from or not subject to any particular Tax, Buyer shall provide Seller with all necessary documentation within thirty (30) days after the Effective Date to evidence such exemption or exclusion. If Buyer does not provide such documentation, then Buyer shall indemnify, defend, and hold Seller harmless from any liability with respect to Taxes from which Buyer claims it is exempt.
5.2 Cooperation. Each Party shall use reasonable efforts to implement the provisions of and administer this Agreement in accordance with the intent of the Parties to minimize all Taxes, so long as no Party is materially adversely affected by such efforts. The Parties shall cooperate to minimize Tax exposure; provided, neither Party shall be obligated to incur any financial or operational burden to reduce Taxes for which the other Party is responsible hereunder without 52 receiving due compensation therefor from the other Party. All Energy delivered by Seller to Buyer hereunder shall be a sale made at wholesale, with Buyer reselling such Energy.
5.3 Ownership. Seller shall be the owner of the Facility for federal income tax purposes and, as such, Seller (or its Affiliates) shall be entitled to all depreciation deductions associated with the Facility and to any and all Renewable Energy Incentives or other tax benefits associated with the Facility, including any such tax credits or tax benefits under the Internal Revenue Code of 1986, as amended. The Parties intend this Agreement to be a “service contract” within the meaning of Section 7701(e)(3) of the Internal Revenue Code of 1986, as amended. The Parties will not take the position on any tax return or in any other filings suggesting that it is anything other than a purchase of the Product from the Seller or that this agreement is anything other than a “service contract” within the meaning of Section 7701(e)(3) of the Internal Revenue Code of 1986, as amended.
ARTICLE 6
MAINTENANCE OF THE FACILITY
6.1 Maintenance of the Facility. Seller shall comply with Law and Prudent Operating Practice relating to the operation and maintenance of the Facility and the generation and sale of Product.
(a) Seller shall provide to Buyer no later than ninety (90) days prior to the Commercial Operation Date for the period from the Commercial Operation Date through the end of the then-current calendar year, and no later than September 1 of each calendar year thereafter for the following calendar year, a schedule of all planned outages or derates of the Facility for maintenance purposes (“Scheduled Maintenance”). Seller may perform no more than of Scheduled Maintenance that involves a reduction in the Available Generating Capacity and/or Available Storage Capacity of the Facility per Contract Year. Seller shall not conduct Scheduled Maintenance between June 1 and of each year. Seller shall use commercially reasonable efforts to accommodate reasonable requests of Buyer with respect to adjusting the timing of Scheduled Maintenance. Seller may modify its schedule of Scheduled Maintenance upon reasonable advance notice to Buyer, subject to reasonable requests of Buyer and consistent with Section 4.4 and this Section 6.1.
(b) Seller shall use commercially reasonable efforts to perform during periods of Scheduled Maintenance all maintenance that will reduce the Facility’s output or availability.
Seller shall arrange for any necessary non-emergency maintenance that is not Scheduled Maintenance and that reduces the Available Generating Capacity and/or Available Storage Capacity of the Facility by more than ten percent (10%) to occur only between November 1 and May 31 of each year, unless (i) such outage is required to avoid damage to the Facility, persons or property, (ii) such maintenance is necessary to maintain equipment warranties and cannot be scheduled outside the months of June through September, (iii) the Parties agree otherwise in writing.
(c) Seller shall use commercially reasonable efforts to schedule all maintenance outages, including those associated with Scheduled Maintenance (i) within a single month, rather than across multiple months, (ii) during periods in which CAISO does not require resource 53 substitution or replacement, and (iii) otherwise in a manner to avoid reductions in the Resource Adequacy Benefits available from the Facility to Buyer, provided, Seller shall not be required to consolidate preventative maintenance activities into a single month where such consolidation is inconsistent with vendor-recommended maintenance schedules.
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 on Exhibit R Notice of such condition. Such action may include disconnecting and removing all or a portion of the Facility, or suspending the supply of Energy to Buyer.
6.3 Permits and Approvals. As between Buyer and Seller, Seller shall obtain any required permits and approvals in connection with the development, construction, and operation of the Facility, including without limitation, environmental clearance under the California Environmental Quality Act or other environmental Law, from the state or local jurisdiction where the Facility will be constructed.
6.4 Energy to Serve Station Use. Notwithstanding anything to the contrary in this Agreement, the Parties acknowledge (a) Seller is responsible for providing all Energy to serve Station Use (including paying the cost of any Energy used to serve Station Use and the cost of energy provided by third parties used to serve Station Use); and (b) Seller may utilize Energy to serve Station Use to the extent permissible in accordance with the CAISO Tariff and subject to the following requirements and restrictions:
(i) Seller shall not bill Buyer and Buyer will not pay Seller for any Energy that serves Station Use, and Seller shall bear all costs associated with Energy that serves Station Use, including (A) any Energy produced by the Generating Facility that serves Station Use; (B) any
Stored Energy or Energy discharged from the Storage Facility, that serves Station Use during periods when such service is permissible in accordance with the CAISO Tariff (ii)
to ensure that records and invoices to Buyer are
accurate and do not improperly bill Buyer for Energy that serves Station Use and to enable Buyer to invoice Seller for Reimbursable Station Use Payments; (iii) Seller shall ensure that any use of
Stored Energy or Energy discharged from the
Storage Facility, to serve Station Use, complies with and does not interfere with or impair Buyer’s or the CAISO’s dispatch of or schedule for the Facility, and if Seller fails to comply with such requirements, then, without prejudice to Buyer’s other rights and remedies 54 hereunder, Seller shall reimburse Buyer for (A) any charges, costs, and penalties imposed by the CAISO for the Storage Facility’s failure to comply with dispatch instructions, the CAISO schedule, or any CAISO requirements; and (B) any loss of revenue if the CAISO adjusts dispatch instructions due to the use of Stored Energy or Energy discharged from the Storage Facility to serve Station Use, in each case only to the extent imposed or incurred as a direct result of Seller’s use of Stored Energy or Energy discharged from the Storage Facility to serve Station Use; (iv) Any use of Energy generated by the Generating Facility, Energy discharged from the Storage Facility or Stored Energy for Station Use shall not (A) reduce Seller’s obligations to achieve the Guaranteed Storage Availability and Guaranteed Round-Trip Efficiency, or (B) count toward limits specified in the Operating Restrictions; and (v) Seller shall provide to Buyer upon Buyer’s request all records and data, including detailed meter, charging, discharging, and state of charge data, that may be necessary or useful for Buyer to verify that service of Station Use occurred in compliance with this Section 6.4, and to calculate and verify the accuracy of invoices and amounts required to be reimbursed hereunder.
ARTICLE 7
METERING
7.1 Metering.
(a) Subject to Section 7.1(b) (with respect to the entirety of the following Section 7.1(a)), the Facility shall have separate CAISO Resource IDs for each of the Generating Facility and the Storage Facility. The Facility shall be configured as a Seller shall measure the following using CAISO Approved Meters and CAISO approved methodologies : the amount of Facility Energy produced by the Facility; the amount of PV Energy produced by the Generating Facility; and the amount of Charging Energy and Discharging Energy;
. The CAISO Approved Meter shall be installed and maintained at Seller’s cost.
Metering will be consistent with the Metering
Diagram set forth in Exhibit P,
The meter(s) shall be kept under seal, such seals to be broken only when the meters are to be tested, adjusted, modified or relocated. In the event that Seller breaks a seal, Seller shall notify Buyer as soon as practicable. In addition, Seller hereby agrees to provide all meter data to Buyer in a form reasonably acceptable to Buyer, and consents to Buyer obtaining from CAISO all meter data applicable to each of the Generating Facility and the Storage Facility and all inspection, testing and calibration data and reports,
. Seller and Buyer shall cooperate to allow both
Parties to retrieve the meter reads from the CAISO Operational Meter Analysis and Reporting (OMAR) web and/or directly from the meter(s) at the Generating Facility and the Storage Facility, 55 (b) The foregoing Section 7.1(a) is based on the Parties’ mutual understanding as of the Effective Date that (i) the CAISO requires the configuration of the Facility to include as the sole meters for the Facility, the Generating Facility Meter and the Storage Facility Meter, (ii) the CAISO requires the Generating Facility Meter and the Storage Facility Meter to be programmed for Electrical Losses as set forth in the definition of Electrical Losses in this Agreement, and (iii) the automatic adjustments to Charging Notices and Discharging Notices as set forth in the definitions of Charging Notice and Discharging Notice in this Agreement will not result in the Scheduling Coordinator violating, or incurring any costs, penalties, or charges under, the CAISO Tariff. If any of the foregoing mutual understandings in (i), (ii), or (iii) between the Parties become incorrect during the Delivery Term, the Parties shall cooperate in good faith to make any amendments and modifications to the Facility and this Agreement as are reasonably necessary to conform this Agreement to the CAISO Tariff and avoid, to the maximum extent practicable, any CAISO charges, costs, or penalties that may be imposed on either Party due to non-conformance with the CAISO Tariff, such agreement not to be unreasonably delayed, conditioned, or withheld. In the case of preceding clause (iii), until the Parties agree on an alternative approach, Seller shall be responsible for all CAISO costs, penalties, and charges that result from Seller’s compliance with the automatic adjustments of Charging Notices and Discharging Notices as set forth in the definitions of Charging Notice and Discharging Notice in this Agreement, and in connection with any automatic adjustment to a Discharging Notice set forth in the definition of Discharging Notice, if any such automatic adjustment is prohibited by CAISO, then Seller shall instead reduce deliveries of PV Energy to the Delivery Point as necessary to avoid exceeding the Interconnection Capacity Limit and such reductions shall be treated as Lost Output.
7.2 Meter Verification. If Buyer or Seller has reason to believe there may be a meter malfunction, Seller shall test the meter. Annually, 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 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.
ARTICLE 8
INVOICING AND PAYMENT; CREDIT
8.1 Invoicing. Seller shall deliver an invoice to Buyer for Product no later than after the end of the prior monthly billing period. Each invoice shall provide Buyer (a) records of metered data, including CAISO metering and transaction data sufficient to document and verify the generation of Product by the Generating Facility and the Storage Facility for any Settlement Period during the preceding month, the amount of Product in MWh produced by the Facility as read by the Generating Facility Meter, Storage Facility Meter, and CAISO Approved Meter, the amount of Replacement RA delivered to Buyer, the calculation of Deemed Delivered Energy and Adjusted Energy Production, and the Contract Price applicable to such Product, Station Use and Reimbursable Station Use for any Settlement Period during the preceding month; (b) 56 records and calculations sufficient to show the calculation of the Storage Capacity Payment, including calculations of any applicable Storage Availability Adjustment and Round-Trip Efficiency Adjustment; and (c) access to any records, including invoices or settlement data from the CAISO, necessary to verify the accuracy of any amount. Invoices shall be in a format specified by Buyer, covering the services 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 by wire transfer or ACH payment to the bank account provided on each monthly invoice. Buyer shall pay undisputed invoice amounts within 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. Either Party, upon fifteen (15) days written Notice to the other 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.
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 otherwise disputed under Section 8.5, 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. Except for adjustments required due to a correction of data by the CAISO, any adjustment described in this Section 8.4 is waived if Notice of the adjustment is not provided within twelve (12) months after the invoice is rendered or subsequently adjusted.
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 57 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 upon request or deducted by the Party receiving such overpayment from subsequent payments, with interest accrued at the Interest Rate from and including the date of such overpayment to but excluding the date repaid or deducted by the Party receiving such overpayment. 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 party other than the Party seeking the adjustment and such 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, including any related damages calculated pursuant to Exhibits B and D, 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 Seller’s obligations under this Agreement, including the obligations of Seller to pay liquidated damages to Buyer as provided in this Agreement, Seller shall deliver Development Security to Buyer within after the Effective Date. Buyer will have the right to draw upon the Development Security if Seller fails to pay liquidated damages owed to Buyer pursuant to Exhibit B to this Agreement, or if Seller fails to pay a Damage Payment owed to Buyer pursuant to Section 11.2. Seller shall maintain the Development Security in full force and effect and Seller shall replenish the Development Security in the event Buyer collects or draws down any portion of the Development Security for any reason permitted under this Agreement other than to satisfy a Damage Payment, Following the earlier of (i) Seller’s delivery of the Performance Security, or (ii) sixty (60) days after termination of this Agreement, Buyer shall promptly 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 replenish the Performance Security in the event Buyer collects or draws down any portion of the Performance Security for any reason permitted under this Agreement within five (5) Business Days after such draw, other than to satisfy a Termination Payment. Seller shall maintain the Performance 58 Security in full force and effect until the date on which the following have occurred (“Performance Security End Date”): (A) the Delivery Term has expired or terminated early; and (B) all payment obligations of the Seller arising 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 the Performance Security End Date, Buyer shall promptly return to Seller the unused portion of the Performance Security. Provided that no Event of Default has occurred with respect to Seller, Seller may replace or change the form of Performance Security to another form of Performance Security from time to time upon reasonable prior written notice to Buyer.
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 these obligations are satisfied in full.
ARTICLE 9
59 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 R or at such other address or addresses as a Party may designate for itself from time to time by Notice hereunder.
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, facsimile, or other electronic means) and either (i) the receiving Party sends a written acknowledgment of receipt, or (ii) concurrently with the transmittal of such electronic communication the sending Party provides a copy of such electronic Notice by hand delivery or express courier, at the time indicated by the time stamp upon delivery; 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 reasonable efforts, cannot be avoided by and is beyond the reasonable control (whether direct or indirect) of and without the fault or negligence of the Party relying thereon as justification for such delay, nonperformance, or noncompliance. (b) Without limiting the generality of the foregoing, so long as the following events, despite the exercise of reasonable efforts, cannot be avoided by, and are beyond the reasonable control (whether direct or indirect) of and without the fault or negligence of the Party relying thereon as justification for such delay, nonperformance or noncompliance, a Force Majeure Event may include an act of God or the elements, such as flooding, lightning, hurricanes, tornadoes, or ice storms; explosion; fire; volcanic eruption; flood; epidemic; landslide; mudslide; sabotage; terrorism; earthquake; or other cataclysmic events; an act of public enemy; war; blockade; civil insurrection; riot; civil disturbance; or strikes or other labor difficulties caused or suffered by a Party or any third party except as set forth below.
60 (c) Notwithstanding the foregoing, the term “Force Majeure Event” does not include (i) economic conditions that render a Party’s performance of this Agreement at the Contract Price unprofitable or otherwise uneconomic (including an increase in component or compliance costs for any reason, including foreign or domestic tariffs, Buyer’s ability to buy the Product at a lower price, or Seller’s ability to sell the Product at a higher price, than the Contract Price); (ii) Seller’s inability to obtain permits or approvals of any type for the construction, operation, or maintenance of the Facility,
(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 that disables physical or electronic facilities necessary to transfer funds to the payee Party; (iv) a Curtailment Period, except to the extent such Curtailment Period is caused by a Force Majeure Event; (v) Seller’s inability to obtain sufficient labor, equipment, materials, or other resources to build or operate the Facility except to the extent such inability is caused by a Force Majeure Event; (vi) 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; (viii) or (ix) failure to complete the
interconnection facilities or network upgrades required to connect the Facility and to deliver Product to the Delivery Point by the Guaranteed Commercial Operation Date except to the extent such inability is caused by a Force Majeure Event; or (x) Seller’s inability to achieve Construction Start of the Facility following the Guaranteed Construction Start Date or achieve Commercial Operation following the Guaranteed Commercial Operation Date; it being understood and agreed, for the avoidance of doubt, that the occurrence of a Force Majeure Event may give rise to a Development Cure Period.
10.2 No Liability If a Force Majeure Event Occurs. Neither Seller nor Buyer shall be liable to the other Party in the event it is prevented from performing its obligations hereunder in whole or in part due to a Force Majeure Event. Buyer shall not be obligated to pay for any Product that Seller was not able to deliver as a result of 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
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 the event of any delay or nonperformance resulting from a Force Majeure Event, the Party suffering the Force Majeure Event shall (a) as soon as practicable, notify the other 61 Party in writing of the nature, cause, estimated date of commencement thereof, and the anticipated extent of any delay or interruption in performance, and (b) notify the other Party in writing of the cessation or termination of such Force Majeure Event, all as known or estimated in good faith by the affected Party; provided, a Party’s failure to give timely Notice shall not affect such Party’s ability to assert that a Force Majeure Event has occurred unless the delay in giving Notice materially prejudices the other Party.
10.4 Termination Following Force Majeure Event. If a Force Majeure Event has occurred that has caused either Party to be wholly or partially unable to perform its obligations hereunder, and has continued for a consecutive twelve (12) month period, then the non-claiming Party may terminate this Agreement upon written Notice to the other Party with respect to the Facility experiencing the Force Majeure Event. Upon any such termination, neither Party shall have any liability to the other, save and except for those obligations specified in Section 2.1(c), and Buyer shall promptly return to Seller any Development Security or Performance Security then held by Buyer.
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 five (5) 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 (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) and such failure is not remedied within thirty (30) days after Notice thereof (iv) such Party becomes Bankrupt;
(v) such Party assigns this Agreement or any of its rights hereunder other than in compliance with Sections 14.2 or 14.3, as 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 62 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. (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 to the Delivery Point for sale under this Agreement Energy that was not generated or discharged by the Facility, except with respect to Replacement RA;
(ii) the failure by Seller to achieve the Construction Start Date within one hundred twenty (120) days after the Guaranteed Construction Start Date, or the failure by Seller to achieve Commercial Operation within one after the Guaranteed Commercial Operation Date;
(iii) the failure by Seller to timely obtain CEC Final Certification and Verification in accordance with Section 3.10;
(iv) if, in the first six (6) months or the second six (6) months of any Contract Year, the Adjusted Energy Production amount is not at least ten percent (10%) of the Expected Energy amount for that Contract Year, and Seller fails to demonstrate to Buyer’s reasonable satisfaction, within ten (10) Business Days after Notice from Buyer, the failure to meet the ten percent (10%) minimum;
(v) if in any two (2) consecutive Contract Years, the Adjusted Energy Production amount is not at least sixty-five percent (65%) of the Expected Energy amount in each Contract Year;
(vi) if, in the first Contract Year during the Delivery Term, the average Monthly Storage Availability is not at least fifty percent (50%), or for any Contract Year thereafter, the average Monthly Storage Availability is not at least seventy percent (70%); provided,
(vii) if, for any two (2) consecutive Contract Years, the annual average Round-Trip Efficiency is not at least
(viii) if, in any Contract Year, Seller fails to maintain an average Storage Capacity determined pursuant to one or more Storage Capacity Tests equal to at least seventy-five percent (75%) of the Installed Storage Capacity; provided, (ix) failure by Seller to satisfy the collateral requirements pursuant to Sections 8.7 or 8.8, including the failure to replenish the Development Security or Performance
64 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 (in the case of an Event of Default by Seller under Section 11.1(b)(ii)) or (ii) the Termination Payment, each as 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/or
(e) to exercise any other right or remedy available at law or in equity, including specific performance or injunctive relief, except to the extent such remedies are expressly limited under this Agreement;
provided, 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).
(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 65 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 calculated in the same manner as the Termination Payment in Section 11.3(b). (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 on or after the Commercial Operation Date (“Termination Payment”) for a Terminated Transaction shall be the Settlement Amount plus any or all other amounts due to or from the Non-Defaulting Party netted into a single amount. If the Non-Defaulting Party’s aggregate Gains exceed its aggregate Losses and Costs, if any, resulting from the termination of this Agreement, the net Settlement Amount shall be zero. 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; provided, any lost Capacity Attributes shall be deemed direct damages covered by this Agreement. 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. As soon as practicable after a Terminated Transaction, Notice shall be given by the Non-Defaulting Party to the Defaulting Party of the amount of the Termination Payment and whether the Termination Payment is due to or from the Non-Defaulting Party. The Notice shall include a written statement explaining in reasonable detail the calculation of such amount and the sources for such calculation. The undisputed portion of the Termination Payment shall be made to or from the Non-Defaulting Party, as applicable, within ten (10) Business Days after such Notice is effective.
11.5 Disputes With Respect to Termination Payment. If the Defaulting Party disputes the Non-Defaulting Party’s calculation of the Termination Payment, in whole or in part, the Defaulting Party shall, within five (5) Business Days of receipt of the Non-Defaulting Party’s calculation of the Termination Payment, provide to the Non-Defaulting Party a detailed written 66 explanation of the basis for such dispute. Disputes regarding the Termination Payment shall be determined in accordance with Article 16.
11.6 Limitation on Seller’s Ability to Make or Agree to Third-Party Sales from the Facility after Early Termination Date.
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 are 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 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 AN EXPRESS REMEDY, INDEMNITY PROVISION (EXCLUDING SECTION 11.6), OR
MEASURE OF DAMAGES HEREIN, 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, 67 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 BENEFITS, 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 THE DAMAGE PAYMENT UNDER SECTION 11.3(a) AND THE TERMINATION PAYMENT UNDER SECTION 11.3(b), AND AS PROVIDED IN
EXHIBIT B AND EXHIBIT D, 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, AND (UNLESS EXPRESSLY STATED TO THE CONTRARY) AN EXCLUSIVE REMEDY. IT IS THE INTENT OF THE PARTIES THAT THE LIMITATIONS HEREIN
IMPOSED ON REMEDIES AND THE MEASURE OF DAMAGES BE WITHOUT REGARD
TO THE CAUSE OR CAUSES RELATED THERETO, INCLUDING THE NEGLIGENCE OF
ANY PARTY, WHETHER SUCH NEGLIGENCE BE SOLE, JOINT OR CONCURRENT, OR ACTIVE OR PASSIVE. THE PARTIES HEREBY WAIVE ANY RIGHT TO CONTEST SUCH PAYMENTS AS AN UNREASONABLE PENALTY.
ARTICLE 13
68 REPRESENTATIONS AND WARRANTIES; AUTHORITY
13.1 Seller’s Representations and Warranties. As of the Effective Date, Seller represents and warrants as follows:
(a) Seller is a limited liability company, duly organized, validly existing and in good standing under the laws of the State of Delaware, 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 corporate 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 is located in the State of California.
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 69 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. Buyer will not assert sovereign immunity as a defense to the enforcement of its obligations under this Agreement. (f) Buyer is a “local public entity” as defined in Section 900.4 of the Government Code of the State of California.
13.3 General Covenants. Each Party covenants that commencing on the Effective Date and continuing throughout the Contract Term:
(a) It shall continue to be duly organized, validly existing and in good standing under the Laws of the jurisdiction of its formation and to be qualified to conduct business in 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 any contracts to which it is a party and in material compliance with any Law.
ARTICLE 14
70 ASSIGNMENT
14.1 General Prohibition on Assignments. Except as provided below and in Article 15, neither Seller nor Buyer may voluntarily assign its rights nor delegate its duties under this Agreement, or any part of such rights or duties, without the written consent of the other Party.
Neither Seller nor Buyer shall unreasonably withhold, condition or delay any requested consent to an assignment that is allowed by the terms of this Agreement. Any such assignment or delegation made without such written consent or in violation of the conditions to assignment set out below shall be null and void.
14.2 Permitted Assignment; Change of Control of Seller. Seller may, without the prior written consent of Buyer, transfer or assign this Agreement to: (a) an Affiliate of Seller; or (b) subject to Section 15.1, a Lender as collateral. Any Change of Control of Seller (whether voluntary or by operation of Law) shall be deemed an assignment under this Article 14 and will require the prior written consent of Buyer, which consent shall not be unreasonably withheld.
14.3 Permitted Assignment; Change of Control of Buyer. Buyer may assign its interests in this Agreement to an Affiliate of Buyer or to any entity that has acquired all or substantially all of Buyer’s assets or business, whether by merger, acquisition or otherwise without Seller’s prior written consent, provided, in each of the foregoing situations, (a) the assignee (i) has a Credit Rating of or higher by Moody’s or or higher by S&P, and (ii) is a community choice aggregator or publicly-owned electric utility with retail customers located in the state of California, and (b) no fewer than fifteen (15) Business Days before such assignment Buyer (i) notifies Seller of such assignment and (ii) provides to Seller a written agreement signed by the Person to which Buyer wishes to assign its interests stating that such Person agrees to assume all of Buyer’s obligations and liabilities under this Agreement and under any consent to assignment and other documents previously entered into by Seller as described in Section 15.2(b). Any assignment by Buyer, 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 Seller.
14.4 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 in form reasonably acceptable to both Parties (the “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) Baa2 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 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 14.4.
,
71 ARTICLE 15
LENDER ACCOMMODATIONS
15.1 Granting of Lender Interest. Notwithstanding Section 14.2 or Section 14.3, either Party may, without the consent of the other Party, grant an interest (by way of collateral assignment, or as security, beneficially or otherwise) in its rights and/or obligations under this Agreement to any Lender. Each Party’s obligations under this Agreement shall continue in their entirety in full force and effect. Promptly after granting such interest, the granting Party shall notify the other Party in writing of the name, address, and telephone and facsimile numbers of any Lender to which the granting Party’s interest under this Agreement has been assigned. Such Notice shall include the names of the Lenders to whom all written and telephonic communications may be addressed. After giving the other Party such initial Notice, the granting Party shall promptly give the other Party Notice of any change in the information provided in the initial Notice or any revised Notice.
15.2 Rights of Lender. If a Party grants an interest under this Agreement as permitted by Section 15.1, the following provisions shall apply:
(a) Lender shall have the right, but not the obligation, to perform any act required to be performed by the granting Party under this Agreement to prevent or cure a default by the granting Party in accordance with Section 11.2 and such act performed by Lender shall be as effective to prevent or cure a default as if done by the granting Party. (b) The other Party shall cooperate with the granting Party or any Lender, to execute or arrange for the delivery of certificates, consents, opinions, estoppels, direct agreements, amendments and other documents reasonably requested by the granting Party or Lender in order to consummate any financing or refinancing and shall enter into reasonable agreements with such Lender that provide that the non-granting Party recognizes the Lender’s security interest and such other provisions as may be reasonably requested by the granting Party or any such Lender; provided, all costs and expenses (including reasonable attorney’s fees) incurred by the non-granting Party in connection therewith shall be borne by the granting Party, and that the non-granting Party shall have no obligation to modify this Agreement or to reduce its benefits or increase its risks or burdens under this Agreement.
(c) Each Party agrees that no Lender shall be obligated to perform any obligation or be deemed to incur any liability or obligation provided in this Agreement on the part of the granting Party or shall have any obligation or liability to the other Party with respect to this Agreement except to the extent any Lender has expressly assumed the obligations of the granting Party hereunder; provided, the non-granting Party shall nevertheless be entitled to exercise all of its rights hereunder in the event that the granting Party or Lender fails to perform the granting Party’s obligations under this Agreement.
15.3 Cure Rights of Lender. The non-granting Party shall provide Notice of the occurrence of any Event of Default described in Sections 11.1 or 11.2 hereof to any Lender, and 72 such Party shall accept a cure performed by any Lender and shall negotiate in good faith with any Lender as to the cure period(s) that will be allowed for any Lender to cure any granting Party Event of Default hereunder. The non-granting Party shall accept a cure performed by any Lender so long as the cure is accomplished within the applicable cure period so agreed to between the non-granting Party and any Lender. Notwithstanding any such action by any Lender, the granting Party shall not be released and discharged from and shall remain liable for any and all obligations to the non-granting Party arising or accruing hereunder. The cure rights of Lender may be documented in the certificates, consents, opinions, estoppels, direct agreements, amendments and other documents reasonably requested by the granting Party pursuant to Section 15.2(b).
ARTICLE 16
DISPUTE RESOLUTION
16.1 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]
16.2 Dispute Resolution. In the event of any dispute arising under this Agreement, within ten (10) days following the receipt of a written Notice from either Party identifying such dispute, the Parties shall meet, negotiate and attempt, in good faith, to resolve the dispute quickly, informally and inexpensively. If the Parties are unable to resolve a dispute arising hereunder within the earlier of either thirty (30) days of initiating such discussions, or within forty (40) days after Notice of the dispute, 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.
16.3 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, the prevailing Party shall be entitled to reasonable attorneys’ fees (including reasonably allocated fees of in-house counsel) in addition to court costs and any and all other costs recoverable in said action.
16.4 Venue. The Parties agree that any litigation arising with respect to this Agreement is to be venued in the Superior Court for the county of San Mateo, California ARTICLE 17
INDEMNIFICATION
17.1 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 third-party claims, demands, losses, liabilities, penalties, and expenses (including reasonable attorneys’ fees) 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 violation of Law or the negligent or willful misconduct of the Indemnifying Party, its Affiliates, its directors, officers, employees, or agents. 73 (b) Nothing in this Section 17.1 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.
17.2 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 17 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 such 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 17, in the event that a Party is obligated to indemnify and hold the other Party and its successors and assigns harmless under this Article 17, 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.
ARTICLE 18
INSURANCE
18.1 Insurance.
(a) General. Seller shall comply at all times during the Contract Term with the requirements of Exhibit J.
(b) Subcontractor Insurance. Seller shall require all of its subcontractors to carry: (i) comprehensive general liability insurance in amounts equal to those set forth for Seller in Exhibit J; (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, in each case, in amounts equal to those set forth for Seller in Exhibit J. All subcontractors shall name Seller as an additional insured to insurance carried pursuant to clauses (f)(i) and (f)(iii). All subcontractors shall provide a primary endorsement and a waiver of subrogation to Seller for the required coverage pursuant to this Section 18.1(b). 74 (c) Evidence of Insurance. Within ten (10) days after execution of the Agreement and upon annual renewal thereafter, Seller shall deliver to Buyer certificates of insurance evidencing such coverage. These certificates shall specify that Buyer shall be given at least thirty (30) days prior Notice by Seller in the event of any material modification, cancellation or termination of coverage. Such insurance shall be primary coverage without right of contribution from any insurance of Buyer. Any other insurance maintained by Seller is for the exclusive benefit of Seller and shall not in any manner inure to the benefit of Buyer. Seller shall also comply with all insurance requirements by any renewable energy or other incentive program administrator or any other applicable authority.
(d) Failure to Comply with Insurance Requirements. If Seller fails to comply with any of the provisions of this Article 18, 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 18 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 19
CONFIDENTIAL INFORMATION
19.1 Definition of Confidential Information. The following constitutes “Confidential Information,” whether oral or written, and whether delivered by Seller to Buyer or by Buyer to Seller: (a) proposals and negotiations of the Parties in the negotiation of this Agreement; (b) the terms and conditions of this Agreement; and (c) information that either Seller or Buyer stamps or otherwise identifies as “confidential” or “proprietary” or words of similar import 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; (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.
19.2 Duty to Maintain Confidentiality. The Party receiving Confidential Information shall treat it as confidential, and shall adopt reasonable information security measures to maintain its confidentiality, employing the higher of (a) the standard of care that the receiving Party uses to preserve its own confidential information, or (b) a standard of care reasonably tailored to prevent unauthorized use or disclosure of such Confidential Information. Confidential Information may be disclosed by the recipient if and to the extent such disclosure is required (a) by Law, (b) pursuant to an order of a court or (c) in order to enforce this Agreement. The Party that originally discloses 75 Confidential Information may use such information for its own purposes, and may publicly disclose such information at its own discretion. Notwithstanding the foregoing, Seller acknowledges that Buyer is required to make portions of this Agreement available to the public in connection with the process of seeking approval from its board of directors for execution of this Agreement. Buyer may, in its discretion, redact certain terms of this Agreement as part of any such public disclosure, and will use reasonable efforts to consult with Seller prior to any such public disclosure. Seller further acknowledges that Buyer is a public agency subject to the requirements of the California Public Records Act (Cal. Gov. Code section 6250 et seq.). Upon request or demand from any third person not a Party to this Agreement for production, inspection and/or copying of this Agreement or other Confidential Information provided by Seller to Buyer, Buyer shall, to the extent permissible, notify Seller in writing in advance of any disclosure that the request or demand has been made; provided, upon the advice of its counsel that disclosure is required, Buyer may disclose this Agreement or any other requested Confidential Information, whether or not advance written notice to Seller has been provided. Seller shall be solely responsible for taking whatever steps it deems necessary to protect Confidential Information that is the subject of any Public Records Act request submitted by a third person to Buyer.
19.3 Irreparable Injury; Remedies. Buyer and Seller each agree that disclosing Confidential Information of the other in violation of the terms of this Article 19 may cause irreparable harm, and that the harmed Party may seek any and all remedies available to it at Law or in equity, including injunctive relief and/or notwithstanding Section 12.2, consequential damages.
19.4 Disclosure to Lender. Notwithstanding anything to the contrary in this Article 19, Confidential Information may be disclosed by Seller to any potential Lender or any of its agents, consultants or trustees so long as the Person to whom Confidential Information is disclosed agrees in writing to be bound by the confidentiality provisions of this Article 19 to the same extent as if it were a Party.
19.5 Disclosure to Credit Rating Agency. Notwithstanding anything to the contrary in this Article 19, Confidential Information may be disclosed by either Party to any nationally recognized credit rating agency (e.g., Moody’s Investors Service, Standard & Poor’s, or Fitch Ratings) in connection with the issuance of a credit rating for that Party or its Affiliates, provided, any such credit rating agency agrees in writing to maintain the confidentiality of such Confidential Information.
19.6 Public Statements. 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 press release.
ARTICLE 20
MISCELLANEOUS
20.1 Entire Agreement; Integration; Exhibits. This Agreement, together with the Cover Sheet and Exhibits attached hereto constitutes the entire agreement and understanding between Seller and Buyer with respect to the subject matter hereof and supersedes all prior 76 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.
20.2 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.
20.3 Time is of the Essence. The Parties agree that time is of the essence with respect each Party’s performance of its obligations under the Agreement.
20.4 No Waiver. Waiver by a Party of any default by the other Party shall not be construed as a waiver of any other default.
20.5 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).
20.6 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.
20.7 Mobile-Sierra. Notwithstanding any other provision of this Agreement, neither Party shall seek, nor shall they support any third party seeking, to prospectively or retroactively revise the rates, terms or conditions of service of this Agreement through application or complaint to FERC pursuant to the provisions of Section 205, 206 or 306 of the Federal Power Act, or any other provisions of the Federal Power Act, absent prior written agreement of the Parties. Further, absent the prior written agreement in writing by both Parties, the standard of review for changes to the rates, terms or conditions of service of this Agreement proposed by a Party, a non-Party or the FERC acting sua sponte 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). 77 20.8 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.
20.9 Facsimile or Electronic Delivery. This Agreement may be duly executed and delivered by a Party by execution and facsimile or electronic format (including portable document format (.pdf)) delivery of the signature page of a counterpart to the other Party, and, if delivery is made by facsimile or other electronic format, the executing Party shall promptly deliver, via overnight delivery, a complete original counterpart that it has executed to the other Party, but this Agreement shall be binding on and enforceable against the executing Party whether or not it delivers such original counterpart.
20.10 Binding Effect. This Agreement shall inure to the benefit of and be binding upon the Parties and their respective successors and permitted assigns.
20.11 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.
20.12 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 ninety (90) 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 16. 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, or constitute, or form the basis of, a Force Majeure Event, and (ii) this Agreement shall remain in full force and effect, subject to any necessary changes, if any, agreed to by the Parties or determined through dispute resolution.
Exhibit A - 1
EXHIBIT A
DESCRIPTION OF THE FACILITY
Facility Name: IP Darden III
Site Name: Darden Clean Energy Project
Site Description: See attached as Schedule 1.
Site Address: Seller shall provide thirty (30) days prior to of Construction Start.
GPS Coordinates: 36.470938,-120.21475
Site Map: See attached as Schedule 1.
APNs: Darden III:
County: Fresno, County
CEQA Lead Agency: California Energy Commission
Generation Technology: First Solar, Single-Axis Tracker. Type and Model to be confirmed.
Storage Technology: Lithium-ion battery
P-node/Delivery Point: The PNode designated by CAISO for each of the Generating Facility and Storage Facility at the PG&E Los Banos-Midway #2 Substation
Point of Interconnection: PG&E’s Los Banos-Midway #2 500kV Transmission Line Description of Interconnection Facilities and Metering: The Facility will use the following Interconnection Facilities and metering configuration, as depicted in the attached one-line diagram: the Facility interconnects at a new 500kV breaker-and-a-half (BAAH) switching station to be self-built by IP and deeded to PG&E. A ~14 mi 500kV gen-tie heading east from a new PG&E station will cross I-5 and terminate at the Facility’s substation, where the Facility’s output will be collected on 34.5kV circuits. Within the Facility’s substation, 8 generator step-up transformers will convert energy coming into the station at 34.5kV up to 500kV for export across the 500kV gen-tie and into a new PG&E Switching Station.
CAISO Queue Number: 1949
2 One-Line Diagram:
Additional Information:
3 Schedule 1
List of all APNs
Darden III:
4 Site Map
Exhibit B - 1
EXHIBIT B
FACILITY CONSTRUCTION AND COMMERCIAL OPERATION
1. Construction of the Facility.
a. Seller shall cause construction to begin on the Facility by June 1, 2027, (as such date may be extended by the Development Cure Period, the “Guaranteed Construction Start Date”). Seller shall demonstrate the beginning of construction through execution of Seller’s engineering, procurement and construction contract, Seller’s issuance of a notice to proceed under such contract, mobilization to site by Seller and/or its designees, and includes the physical movement of soil at the Site (“Construction Start”). On the date of the beginning of construction (the “Construction Start Date”), Seller shall deliver to Buyer a certificate substantially in the form attached as Exhibit H hereto.
b. If Construction Start is not achieved by the Guaranteed Construction Start Date, Seller shall pay Daily Delay Damages to Buyer on account of such delay. Daily Delay Damages shall be payable for each day for which Construction Start has not begun by the Guaranteed Construction Start Date. Daily Delay Damages shall be payable to Buyer by Seller until the earlier of one hundred twenty (120) days after the Guaranteed Construction Start Date, or the date on which Seller reaches Construction Start of the Facility. On or before the tenth (10th) day of each month, Buyer shall invoice Seller for Daily Delay Damages, if any, accrued during the prior month and, within ten (10) Business Days following Seller’s receipt of such invoice, Seller shall pay Buyer the amount of the Daily Delay Damages set forth in such invoice. Daily Delay Damages shall be refundable to Seller pursuant to Section 3(b) of this Exhibit B. The Parties agree that Buyer’s receipt of Daily Delay Damages shall be Buyer’s sole and exclusive remedy for the first one hundred twenty (120) days of the delay in achieving the Construction Start Date on or before the Guaranteed Construction Start Date, but shall (x) not be construed as Buyer’s declaration that an Event of Default has occurred under any provision of Section 11.1 and (y) not limit Buyer’s right to declare an Event of Default pursuant to Section 11.1(b)(ii) and receive a Damage Payment upon exercise of Buyer’s rights pursuant to Section 11.2.
2. Commercial Operation of the Facility. “Commercial Operation” means the condition existing when (i) Seller has fulfilled all of the conditions precedent in Section 2.2 of the Agreement and (ii) Seller has provided Notice to Buyer that Commercial Operation has been achieved. The “Commercial Operation Date” shall be the later of (x) June 1, 2028 or (y) the date on which Commercial Operation is achieved,
a. Seller shall cause Commercial Operation for the Facility to occur by June 1, 2028 (as such date may be extended by the Development Cure Period (defined below), the “Guaranteed Commercial Operation Date”). Seller shall notify Buyer that it intends to achieve Commercial Operation at least sixty (60) days before the anticipated Commercial Operation Date.
Exhibit C - 1
EXHIBIT C
[Intentionally Omitted]
Exhibit D - 1
EXHIBIT D
GUARANTEED ENERGY PRODUCTION DAMAGES CALCULATION
In accordance with Section 4.8, 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)]
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 calculated as (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
D = the average Renewable Rate for the Performance Measurement Period, in $/MWh
No payment shall be due if the calculation of (A - B) or (C - D) yields a negative number.
Within sixty (60) days after each Performance Measurement Period, Buyer will 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.
Exhibit D - 2
Additional Definitions:
“Adjusted Energy Production” shall mean the sum of the following: PV Energy + Deemed Delivered Energy + Lost Output – Excess MWh.
“Lost Output” means the amount of Energy that qualifies as PCC1, expressed in MWh, that the Generating Facility would have generated and delivered, but did not, on account of Force Majeure Event, Buyer Default, or Curtailment Order, which amount shall be equal to (a) the VER Forecast expressed in MWh, applicable to the Buyer Curtailment Period, or (b) if there is no VER Forecast available or Seller demonstrates to Buyer’s reasonable satisfaction that the VER Forecast does not represent an accurate forecast of generation from the Generating Facility, the amount determined by a third party reasonably acceptable to Buyer using an industry standard forecasting or back-casting methodology to determine the potential generation of the Generating Facility as a function of Available Generating Capacity, solar insolation and panel temperature, and using relevant Facility availability, weather, historical and other pertinent data for the period of time during the period in which the Force Majeure Event, Buyer Default, or Curtailment Order occurred.
Exhibit E - 1
EXHIBIT E
PROGRESS REPORTING FORM
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 written Progress Report in the form specified below.
Each Progress Report must include the following items:
1. Executive summary.
2. Facility description.
3. Site plan of the Facility.
4. Description of any planned changes to the Facility or the Site.
5. Gantt chart schedule showing progress on achieving each of the Milestones.
6. Summary of activities during the previous calendar quarter or month, as applicable, including any OSHA labor hour reports.
7. Forecast of activities scheduled for the current calendar quarter.
8. Written description about the progress relative to Seller’s Milestones, including whether Seller has met or is on target to meet the Milestones.
9. List of issues that could potentially affect Seller’s Milestones.
10. A status report of start-up activities including a forecast of activities ongoing and after start-up, a report on Facility performance including performance projections for the next twelve (12) months.
11. Progress and schedule of all agreements, contracts, 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.
14. Any other documentation reasonably requested by Buyer.
Exhibit F - 1
EXHIBIT F
Exhibit G1 - 1
EXHIBIT G-1
FORM OF COMMERCIAL OPERATION DATE CERTIFICATE
This certification (“Certification”) of Commercial Operation is delivered by _______[Licensed Professional Engineer] (“Engineer”) to Peninsula Clean Energy Authority (“Buyer”) in accordance with the terms of that certain Power Purchase and Sale 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.
Engineer hereby certifies and represents to Buyer the following:
(1) Seller has installed generating equipment with a nameplate capacity of no less than ninety-five percent (95%) of the Guaranteed PV Capacity. (2) Seller has installed and commissioned storage equipment with a capacity of at least ninety-five percent (95%) of the Guaranteed Storage Capacity in accordance with Exhibit N of the Agreement.
(3) The Storage Facility is capable of receiving Charging Energy from, and delivering Discharging Energy to, the Delivery Point and commissioning of equipment at the Storage Facility has been completed in accordance with the manufacturer’s specifications. (4) The Generating Facility’s testing included a performance test demonstrating peak electrical output of no less than ninety-five percent (95%) of the Guaranteed PV Capacity at the Delivery Point.
(5) Authorization to parallel the Facility was obtained by the Participating Transmission Owner, [Name of Participating Transmission Owner as appropriate] on___[DATE]____ (6) The Participating Transmission Owner or Distribution Provider has provided documentation supporting full unrestricted release for Commercial Operation by [Name of Participating Transmission Owner as appropriate] on _______[DATE]_____. (7) The CAISO has provided notification supporting the Facility’s Commercial Operation, inclusion in the Full Network Model and authorization to provide Ancillary Services from the Storage Facility, all in accordance with the CAISO tariff on _______[DATE]_____. (8) Seller has
(9) The total rated power of the Storage Facility inverters associated with the Installed Storage Capacity as measured to the Delivery Point is at least [____] MW charging and [____] MW discharging at 45°C ambient air temperature.
Exhibit G1 - 2
EXECUTED by [licensed professional engineer]
this ________ day of _____________, 20__.
[LICENSED PROFESSIONAL
ENGINEER]
By:
Its:
Date:
Exhibit G2 - 1
EXHIBIT G-2
FORM OF INSTALLED CAPACITY CERTIFICATE
This certification (“Certification”) of Installed Capacity is delivered by [Licensed Professional Engineer] (“Engineer”) to PENINSULA CLEAN ENERGY AUTHORITY (“Buyer”) in accordance with the terms of that certain Power Purchase and Sale Agreement dated __________ (“Agreement”) by and between [SELLER ENTITY] and Buyer. All capitalized terms used in this Certification but not otherwise defined herein shall have the respective meanings assigned to such terms in the Agreement.
The initial Generating Facility performance test under Seller’s engineering, procurement and construction contract or primary solar module supply agreement for the Generating Facility conducted on [Date] demonstrated peak Generating Facility electrical output of __MW AC at the Delivery Point, as adjusted for ambient conditions on the date of the performance test (“Installed PV Capacity”).
The Commercial Operation Storage Capacity Test conducted on [Date] demonstrated a maximum dependable operating capability to discharge electric energy of __ MW AC to the Delivery Point at four (4) hours of continuous discharge, in accordance with the testing procedures, requirements and protocols set forth in Section 4.13 and Exhibit N (“Installed Storage Capacity”).
EXECUTED by [LICENSED PROFESSIONAL ENGINEER]
this ________ day of _____________, 20__.
[LICENSED PROFESSIONAL
ENGINEER]
By:
Its:
Date:
Exhibit H - 1
EXHIBIT H
FORM OF CONSTRUCTION START DATE CERTIFICATE
This certification (“Certification”) of the Construction Start Date is delivered by [SELLER ENTITY] (“Seller”) to PENINSULA CLEAN ENERGY AUTHORITY (“Buyer”) in accordance with the terms of that certain Power Purchase and Sale 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. the engineering, procurement and construction contract related to the Facility was executed on __________;
2. the limited notice to proceed with the construction of the Facility was issued on ______________ (attached);
3. the Construction Start Date has occurred;
4. 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).
IN WITNESS WHEREOF, the undersigned has executed this Certification on behalf of Seller as of the ___ day of ________.
[SELLER ENTITY]
By:
Its:
Date:
Exhibit I - 1
EXHIBIT I
FORM OF LETTER OF CREDIT
[ISSUING BANK LETTERHEAD AND ADDRESS]
IRREVOCABLE STANDBY LETTER OF CREDIT NO. [XXXXXXX]
DATE:
BANK REF.:
AMOUNT: US$[XXXXXXX]
EXPIRY DATE:
BENEFICIARY:
PENINSULA CLEAN ENERGY
ADDRESS:
APPLICANT:
INTERSECT POWER, LLC
℅ IP DARDEN III, LLC
9450 SW GEMINI DR, PMB #68743
BEAVERTON, OR 97008-7105
LADIES AND GENTLEMEN:
ON BEHALF OF [XXXXXXX] (“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 [XXXXXXX] (“BENEFICIARY”), ADDRESS__________, FOR AN AMOUNT NOT TO EXCEED THE AGGREGATE SUM OF U.S. $[XXXXXXX] (UNITED STATES DOLLARS AND 00/100),
PURSUANT TO THAT CERTAIN EXCLUSIVITY AGREEMENT DATED AS OF JUNE [XX], 2025(THE “AGREEMENT”) BETWEEN APPLICANT AND BENEFICIARY. THIS
LETTER OF CREDIT SHALL BECOME EFFECTIVE IMMEDIATELY AND SHALL HAVE AN INITIAL EXPIRY DATE OF __________ __, 202_ SUBJECT TO THE AUTOMATIC EXTENSION PROVISIONS HEREIN.
FUNDS UNDER THIS LETTER OF CREDIT ARE AVAILABLE TO YOU AGAINST YOUR
DRAFT(S) DRAWN ON US AT SIGHT IN STRICT COMPLIANCE WITH THE TERMS AND CONDITIONS OF THIS LETTER OF CREDIT ON OR BEFORE 5:00 P.M., NEW YORK
TIME, ON OR BEFORE THE EXPIRATION DATE, MENTIONING THEREON OUR LETTER OF CREDIT NO. [XXXXXXX] ACCOMPANIED BY YOUR DATED STATEMENT
PURPORTEDLY SIGNED BY YOUR DULY AUTHORIZED REPRESENTATIVE, IN THE
FORM ATTACHED HERETO AS EXHIBIT A, CONTAINING ONE OF THE TWO ALTERNATIVE PARAGRAPHS SET FORTH IN PARAGRAPH 2 THEREIN.
Exhibit I - 2
WE HEREBY AGREE WITH THE BENEFICIARY THAT ALL DRAFTS DRAWN UNDER
AND IN COMPLIANCE WITH THE TERMS OF THIS LETTER OF CREDIT WILL BE DULY
HONORED UPON PRESENTATION TO THE ISSUER IN PERSON, BY COURIER OR BY FAX AT [ADDRESS]. PAYMENT SHALL BE MADE BY ISSUER IN U.S. DOLLARS WITH ISSUER’S OWN IMMEDIATELY AVAILABLE FUNDS.
THE DOCUMENT(S) REQUIRED MAY ALSO BE PRESENTED BY FAX AT FACSIMILE NO. ON OR BEFORE THE EXPIRY DATE (AS MAY BE EXTENDED BELOW) ON THIS
LETTER OF CREDIT IN ACCORDANCE WITH THE TERMS AND CONDITIONS OF THIS LETTER OF CREDIT. FACSIMILE SHOULD BE CONFIRMED BY TELEPHONE TO [XXXXXXX]. IN THE CASE OF A DRAW IN THE FULL AMOUNT OF THIS LETTER OF
CREDIT, THE ORIGINAL THEREOF TO BE SENT THE SAME BUSINESS DAY BY OVERNIGHT COURIER TO THE ISSUER. IN THE EVENT A REQUEST IS PRESENTED
VIA FAX TO THE ISSUER, IT IS UNDERSTOOD AND AGREED THAT THE ISSUER MAY
ACT ON SUCH REQUEST WITHOUT THE NEED OR THE OBLIGATION TO SECURE THE ORIGINAL. IN ANY EVENT, THE ISSUER SHALL NOT BE LIABLE FOR ANY
DISCREPANCY THAT MAY ARISE BETWEEN THE REQUEST TRANSMITTED BY FAX AND THE ORIGINAL REQUEST DELIVERED AS PROVIDED HEREIN.
PARTIAL DRAWS ARE PERMITTED UNDER THIS LETTER OF CREDIT.
IT IS A CONDITION OF THIS LETTER OF CREDIT THAT IT SHALL BE DEEMED
AUTOMATICALLY EXTENDED WITHOUT AN AMENDMENT FOR A SUCCESSIVE ONE
YEAR PERIOD BEGINNING ON THE PRESENT EXPIRY DATE HEREOF AND UPON EACH ANNIVERSARY FOR SUCH DATE, UNLESS AT LEAST NINETY (90) DAYS PRIOR
TO ANY SUCH EXPIRY DATE WE HAVE SENT TO YOU WRITTEN NOTICE BY
OVERNIGHT COURIER SERVICE THAT WE ELECT NOT TO PERMIT THIS LETTER OF
CREDIT TO BE SO EXTENDED, IN WHICH CASE IT WILL EXPIRE ON ITS THEN CURRENT EXPIRY DATE. NO PRESENTATION MADE UNDER THIS LETTER OF CREDIT AFTER SUCH EXPIRY DATE WILL BE HONORED.
NOTWITHSTANDING ANY REFERENCE IN THIS LETTER OF CREDIT TO ANY OTHER
DOCUMENTS, INSTRUMENTS OR AGREEMENTS, THIS LETTER OF CREDIT
CONTAINS THE ENTIRE AGREEMENT BETWEEN BENEFICIARY AND ISSUER RELATING TO THE OBLIGATIONS OF ISSUER HEREUNDER.
THIS LETTER OF CREDIT IS SUBJECT TO THE UNIFORM CUSTOMS AND PRACTICE FOR DOCUMENTARY CREDITS (2007 REVISION) INTERNATIONAL CHAMBER OF COMMERCE PUBLICATION NO. 600 (THE “UCP”), EXCEPT TO THE EXTENT THAT THE
TERMS HEREOF ARE INCONSISTENT WITH THE PROVISIONS OF THE UCP, INCLUDING BUT NOT LIMITED TO 36 OF THE UCP, IN WHICH CASE THE TERMS OF THIS LETTER OF CREDIT SHALL GOVERN. IN THE EVENT OF AN ACT OF GOD, RIOT,
CIVIL COMMOTION, INSURRECTION, WAR OR ANY OTHER CAUSE BEYOND ISSUER’S CONTROL (AS DEFINED IN ARTICLE 36 OF THE UCP) THAT INTERRUPTS ISSUER’S BUSINESS AND CAUSES THE PLACE FOR PRESENTATION OF THE LETTER
OF CREDIT TO BE CLOSED FOR BUSINESS ON THE LAST DAY FOR PRESENTATION,
THE EXPIRY DATE OF THE LETTER OF CREDIT WILL BE AUTOMATICALLY Exhibit I - 3
EXTENDED WITHOUT AMENDMENT TO A DATE THIRTY (30) CALENDAR DAYS AFTER THE PLACE FOR PRESENTATION REOPENS FOR BUSINESS.
PLEASE ADDRESS ALL CORRESPONDENCE REGARDING THIS LETTER OF CREDIT
TO THE ATTENTION OF THE LETTER OF CREDIT DEPARTMENT AT BANCO SANTANDER, S.A., NEW YORK BRANCH 437 MADISON AVENUE, 6TH FLOOR, NEW YORK, NY 10022 ATTN: TRADE SERVICES, REFERRING SPECIFICALLY TO ISSUER’S LETTER OF CREDIT NO. [XXXXXXX]. FOR TELEPHONE ASSISTANCE, PLEASE CONTACT ISSUER’S STANDBY LETTER OF CREDIT DEPARTMENT AT 212 350-3671 AND HAVE THIS LETTER OF CREDIT AVAILABLE.
ALL COMMISSIONS, EXPENSES, AND CHARGES INCURRED WITH THIS LETTER OF CREDIT ARE FOR THE ACCOUNT OF THE APPLICANT.
VERY TRULY YOURS,
[INSERT BANK NAME]
_________________________________ _________________________________
AUTHORIZED SIGNATURE AUTHORIZED SIGNATURE
Original Confirmed by: _________________
Exhibit I - 4
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 [XXXXXXX], ADDRESS___________ AS BENEFICIARY (THE “BENEFICIARY”) OF THE IRREVOCABLE LETTER OF CREDIT NO. [XXXXXXX] (THE “LETTER OF CREDIT”) ISSUED BY BANCO SANTANDER, S.A., NEW YORK BRANCH (THE “BANK”) BY ORDER OF [XXXXXXX] (THE “APPLICANT”), HEREBY CERTIFIES TO THE BANK AS FOLLOWS:
1. APPLICANT AND BENEFICIARY ARE PARTY TO THAT CERTAIN AGREEMENT DATED AS OF [XXXXXXX] (THE “AGREEMENT”).
2. BENEFICIARY IS MAKING A DRAWING UNDER THIS LETTER OF CREDIT IN THE AMOUNT OF U.S. $___________.
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 THE BANK HAS
PROVIDED NOTICE OF ITS INTENT TO NOT EXTEND THE EXPIRY DATE OF
THE LETTER OF CREDIT AND APPLICANT FAILED TO PROVIDE ACCEPTABLE REPLACEMENT SECURITY TO BENEFICIARY AT LEAST THIRTY (30) DAYS PRIOR TO THE EXPIRY DATE OF THE LETTER OF CREDIT.
3. THE UNDERSIGNED IS A DULY AUTHORIZED REPRESENTATIVE OF [XXXXXXX] 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 [XXXXXXX] BY WIRE TRANSFER IN IMMEDIATELY AVAILABLE FUNDS TO THE FOLLOWING ACCOUNT:
[SPECIFY ACCOUNT INFORMATION]
[XXXXXXX]
_______________________________
NAME AND TITLE OF AUTHORIZED REPRESENTATIVE
Exhibit I - 5
DATE___________________________
Exhibit J - 1
EXHIBIT J
INSURANCE
Liability Insurance
To the fullest extent allowable by law, Seller shall purchase and maintain such insurance as will protect it from the claims set forth below which may arise out of or result from Seller’s operations under this Agreement whether such operations be by itself or by anyone directly or indirectly employed by them, or by anyone for whose acts any of them may be liable. Limits shall be all the Insurance Coverage and/or limits carried by or available to the Seller, the minimum limits as required herein.
General Conditions
Seller shall maintain completed operations liability insurance for the entire Contract Term plus the period of time Seller may be held legally liable for.
Seller shall maintain policies of insurance in full force and effect, at all times during the performance of the Agreement, plus any statute of repose or statute of limitations applicable to the jurisdiction where any work is performed.
All insurance companies shall have a Best’s rating of A-VII or better.
In addition, Seller shall provide Buyer with 45 days’ notice in case of cancellation or non- renewal, except 10 days for non-payment of premium.
Certificates of Insurance Acord Form 25 and all required Endorsements shall be filed with Buyer within (5) working days of execution of the contract and/or prior to commencement of any work performed.
Acceptance of the certificates or endorsements by the Buyer shall not constitute a waiver of Seller’s obligations hereunder.
If Seller fails to secure and/or pay the premiums for any of the policies of insurance required herein, or fails to maintain such insurance, Buyer may, in addition to any other rights it may have under this Agreement or at law or in equity, terminate this Agreement or secure such policies or policies of insurance for the account of Seller and charge Seller for the premiums paid therefore, or withhold the amount thereof from sums otherwise due from Buyer to Seller. Neither the Buyer’s rights to secure such policy or policies nor the securing thereof by Buyer shall constitute an undertaking by Buyer on behalf of or for the benefit of Seller or others to determine or warrant that such policies are in effect.
Seller shall be fully and financially responsible for all deductibles or self-insured retentions.
Exhibit J - 2
Coverage Forms & Limits
Seller’s Commercial General Liability insurance shall be written on an industry standard Commercial General Liability Occurrence from (CG 00 01, 12/07) or its equivalent and shall include but not be limited to products/completed operations; premises and operations; blanket contractual; advertising/personal injury; independent Buyers.
Coverage shall be on an occurrence form with policy limits of not less than:
• $1,000,000 Each Occurrence Bodily Injury & Property Damage • $1,000,000 Personal & Advertising Injury
• $2,000,000 General Aggregate to apply on a Per Project basis • $2,000,000 Products/Completed Operations Aggregate
Business Auto Liability – Coverage shall be no less than that provided by Insurance Services Office, Inc. (ISO) form CA 00 01, written on an occurrence basis to apply to “any auto” or at a minimum “all owned, hired and non-owned autos”, with policy limits of not less than $1,000,000 per accident for bodily injury and property damage.
If applicable, Broadened Pollution for Covered Autos shall apply. This requirement may also be satisfied by providing proof of separate Pollution Liability that includes coverage for transportation exposures.
Workers’ Compensation and (b) employers’ liability – Sellers shall provide coverage for industrial injury to their employees (or leased employees as applicable) in strict accordance with the provisions of the State or States in which project work is performed or where jurisdiction is deemed to be applicable. Workers’ Compensation shall be provided in a statutory form on either a state or, where applicable, federal (U.S. Longshore & Harbor Workers Act, Maritime- Jones Act, etc.) basis as required in the applicable jurisdiction.
Such insurance shall be in an amount of not less than:
• Workers Compensation: Statutory
• Employers Liability
o $1,000,000 Bodily Injury by Accident – Each Accident
o $1,000,000 Bodily Injury by Disease – Total Limit
o $1,000,000 Bodily Injury by Disease – Each Employee
Commercial Umbrella or Excess Liability Insurance over Seller’s primary Commercial General Liability, Business Auto Liability and Employers Liability. All coverage terms required under the Commercial General Liability, Business Auto Liability and Employers Liability above must be included on the Umbrella or Excess Liability Insurance.
Coverage shall be written on an occurrence form with policy limits not less than:
• $5,000,000 Each Occurrence
• $5,000,000 Personal & Advertising Injury
• $5,000,000 Aggregate (where applicable, following the terms of the underlying)
Exhibit J - 4
of defense costs by the insurer if the insurer initially pays defense costs but later determines the claims are not covered.
Buyer reserves the right, in its sole and subjective discretion, to reject any Additional Insured forms that are deemed not equivalent to what is required herein.
Waiver of Subrogation – Seller shall provide a Waiver of Subrogation Endorsement naming Buyer for all lines of coverage.
Additional Requirements
Property Insurance
Seller shall procure and maintain, at the Seller’s own expense, Builder’s Risk, property and equipment insurance, including for any property stored off the Site, in transit or any of the Buyer’s property in the care, custody or control of Seller. Seller and Seller’s insurance carrier(s) hereby waive all rights of subrogation against Buyer for damage including loss of use.
Buyer neither represents nor assumes responsibility for the adequacy of the Builder’s Risk Insurance to protect the interests of the Seller. It shall be the obligation of the Seller to purchase and maintain any supplementary property insurance that it deems necessary to protect its interest in the Work, including without limitation off site stored materials and materials in transit.
Seller is solely responsible for loss or damage to its personal property.
Exhibit K - 1
EXHIBIT K
FORM OF REPLACEMENT RA NOTICE
This Replacement RA Notice (this “Notice”) is delivered by [ ], a [ ] (“Seller”) to Peninsula Clean Energy Authority, a California joint powers authority (“Buyer”) in accordance with the terms of that certain Power Purchase and Sale Agreement dated [__________] (“Agreement”) by and between Seller and Buyer. All capitalized terms used in this Notice but not otherwise defined herein shall have the respective meanings assigned to such terms in the Agreement.
Pursuant to Section 3.9(b) of the Agreement, Seller hereby provides the below Replacement RA product information (to be repeated for each unit if more than one):
Name
Location
CAISO Resource ID
Unit SCID
Resource Type
Point of Interconnection with the CAISO Controlled
Grid (“substation or transmission line”)
Path 26 (North or South)
LCR Area (if any)
Deliverability restrictions, if any, as described in
most recent CAISO deliverability assessment
Run Hour Restrictions
Deliverability Period
Prorated Percentage of Unit Factor
Prorated Percentage of Unit Flexible Factor
Flexible Capacity Category (e.g., 1, 2, 3, or N/A)
Month Unit CAISO NQC
(MW)
Unit CAISO
EFC (MW)
Unit Contract
Quantity (MW)
Unit EFC Contract
Quantity (MW)
January
February
March
April
May
June
July
August
September
October
November
December
[SELLER]
Exhibit K - 2
By:
Its:
Date:
Whereas, the following definitions apply to the terms in the above Replacement RA product information:
“CPUC RA Filing Guide” means the Filing Guide for System, Local and Flexible Resource Adequacy (RA) Compliance Filings published annually by the CPUC. “Deliverability Period” means the period in which the unit has rights to deliver energy to the CAISO Grid.
“Flexible Capacity Category” means the category of Effective Flexible Capacity, as described in the CPUC RA Filing Guide, applicable to the unit.
“LCR Area (if any)” means the Local Capacity Requirement area, as used in the CPUC RA Filing Guide, applicable to the unit, if any.
“Prorated Percentage of Unit Factor” means the percentage of the Unit CAISO NQC that is designated as Unit Contract Quantity.
“Prorated Percentage of Unit Flexible Factor” means the percentage of Unit CAISO EFC that is designated as Unit EFC Contract Quantity.
“Resource Type” means the type of generating or storage resource. “Run Hour Restrictions” means any restrictions on the ability of the unit to run during any hours of the day.
“Unit CAISO EFC” means the unit’s Effective Flexible Capacity, as described in the CPUC RA Filing Guide, as determined by CPUC and CAISO.
“Unit CAISO NQC” means the NQC (as defined in the CAISO Tariff) for the unit, as determined by CPUC and CAISO.
“Unit Contract Quantity” means the amount of Resource Adequacy Benefits to be provided to Buyer from the unit in the form of Replacement RA, not to exceed the Guaranteed RA Capacity. “Unit EFC Contract Quantity” means the amount of Flexible Resource Adequacy Benefits to be provided to Buyer from the unit in the form of Replacement RA, not to exceed the Guaranteed RA Capacity.
Exhibit K - 3
“Unit SCID” means the unit’s “Scheduling Coordinator ID Code”, as defined in the CAISO Tariff.
Exhibit L1 - 1
EXHIBIT L-1
Annual Energy Forecast
The following table is provided for informational purposes only.
Please provide the expected PV Energy in Pacific Prevailing Time. For the Daylight Savings Day in March, the HE3 volume should be 0 MWh. For the Daylight Savings Day in November, the HE2 volume should represent two hours of generation.
Date Datetime (Hour
Beginning)
Hour Ending MWh
1/1/2022 1/1/2022 0:00 1
1/1/2022 1/1/2022 1:00 2
1/1/2022 1/1/2022 2:00 3
1/1/2022 1/1/2022 3:00 4
1/1/2022 1/1/2022 4:00 5
1/1/2022 1/1/2022 5:00 6
[insert additional rows] … …
12/31/2022 12/31/2022 18:00 19
12/31/2022 12/31/2022 19:00 20
12/31/2022 12/31/2022 20:00 21
12/31/2022 12/31/2022 21:00 22
12/31/2022 12/31/2022 22:00 23
12/31/2022 12/31/2022 23:00 24
Exhibit L2 - 1
EXHIBIT L-2
Monthly Expected Available Generating Capacity
The following table is provided for informational purposes only.
Please adjust the table for the appropriate number of days in the month for each month of the year.
Monthly Forecast of Available Generating Capacity (MW)
c 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 Day 1
Day 2
Day 3
Day 4
Day 5
[insert additional rows for each day of the month]
Day
26 Day
27 Day
28 Day
29**
Day
30**
Day
31**
Exhibit L2 - 2
*All times are designated as “Hour-Ending [__]”.
**Include these rows if needed for each month.
Exhibit L3 - 1
EXHIBIT L-3
Monthly Expected Available Storage Capacity
The following table is provided for informational purposes only.
Please adjust the table for the appropriate number of days in the month for each month of the year.
Monthly Expected Available Storage 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 Day 1
Day 2
Day 3
Day 4
Day 5
[insert additional rows for each day of the month]
Day 26
Day 27
Day 28
Day
29**
Day
30**
Day
31**
*All times are designated as “Hour-Ending [__]”.
Exhibit L3 - 1
**Include these rows if needed for each month.
Exhibit L3 - 1
EXHIBIT L-4
Monthly Expected PV Energy
The following table is provided for informational purposes only.
Please adjust the table for the appropriate number of days in the month for each month of the year.
Monthly Expected PV Energy (MWh)
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 Day 1
Day 2
Day 3
Day 4
Day 5
[insert additional rows for each day of the month]
Day 26
Day 27
Day 28
Day
29**
Day
30**
Day
31**
Exhibit L3 - 1
*All times are designated as “Hour-Ending [__]”.
**Include these rows if needed for each month.
Exhibit M - 2
“A” is the “AVAILABLE STORAGE CAPACITY”, which shall be calculated as the sum of the available capacity of each of the system inverters, in MW AC, from all system inverters expected to receive Charging Energy from or deliver Discharging Energy to the Delivery Point, in such Calculation Interval (based on normal operating conditions pursuant to the manufacturer’s guidelines), provided the Available Storage Capacity shall be the lower of such amounts reported by (i) Seller’s real-time EMS data feed to Buyer for the Storage Facility for such Calculation Interval, and (ii) Seller’s most recent Availability Notice (as updated pursuant to Section 4.4); provided further, if the Storage Facility fails, or is unable, to provide Ancillary Services for any reason (including by reason of failing an Ancillary Services certification test) that is not excused hereunder, then in accordance with Section 4.15, the Available Storage Capacity for such Calculation Interval shall be deemed reduced by an amount equal to the product of (a) the Available Storage Capacity multiplied by (b) and provided further, “A” shall never exceed the Storage Capacity. “AVAILABLE STORAGE CAPABILITY” = the sum of the following (taking into account the SOC at the time of calculation):
i. The battery capability (in MWh) available to receive Charging Energy from the Delivery Point in the applicable Calculation Interval ii. The battery capability (in MWh) available to deliver Discharging Energy to the Delivery Point in the applicable Calculation Interval In calculating Available Storage Capability, the “battery capability (in MWh) available to receive Charging Energy” and “battery capability (in MWh) available to deliver Discharging Energy” are calculated as the product of (1) the count of available system cells in such Calculation Interval, multiplied by (2) the capability, in MWh, expected from each such system cell (based on normal operating conditions pursuant to the manufacturer’s guidelines), that are able (considering the conditions of the Facility in total) to receive Charging Energy from or deliver Discharging Energy to the Delivery Point; provided, the Available Storage Capability shall be the lower of such amounts reported by (i) Seller’s real-time EMS data feed to Buyer for the Storage Facility for such Calculation Interval, and (ii) Seller’s most recent Availability Notice (as updated pursuant to Section 4.4); provided further, Available Storage Capability shall never exceed the Storage Capacity x four (4) hours.
“FAILURE TO COMPLY CAPACITY” = Any portion of the facility, in MW, which failed to comply with a valid Charging Notice or Discharging Notice that complies with this Agreement, including (i) any such failure to charge or discharge at the times, in the quantities, and at the levels specified in such Charging Notice or Discharging Notice; and (ii) any charge or discharge of the Facility other than pursuant to a valid Charging Notice or Discharging Notice that complies with this Agreement, or pursuant to a notice from the CAISO, any PTO, or any other Governmental Authority. Failure To Comply Capacity will be Exhibit M - 3
measured as the absolute value of the difference, in MW, between the average DOT communicated to the Facility by the CAISO for the Calculation Interval and the average metered energy flow for the Calculation Interval; provided, such calculation shall not include any energy related to Ancillary Services to the extent already captured in the calculation of AS Failure to Comply Capacity. “AS FAILURE TO COMPLY CAPACITY” = If any Calculation Interval results in a CAISO No Pay associated with failure to provide Ancillary Services in accordance with the AS Schedule from the CAISO, then the AS Failure to Comply Capacity shall equal the Ancillary Services capacity that Seller failed to provide, in MW. AS Failure to Comply Capacity will be zero to the extent such Failure to Comply is attributable to any actions or inactions of Buyer, the SC or the CAISO or resulting from Seller’s compliance with any Curtailment Order or other instruction or direction from a Governmental Authority or the PTO unless caused by Seller’s fault or negligence;
“TOTAL CALCULATION INTERVALS” = the total number of Calculation Intervals in the applicable month.
(b) If the total rated power of the Storage Facility inverters as measured to the Delivery Point at forty-five degrees (45°) C ambient air temperature is less than the Installed Storage Capacity, then Buyer shall have the right, in its reasonable discretion, to reduce the Available Storage Capacity by applying an ambient temperature derate to the applicable Calculation Interval.
2. Storage Availability Adjustment. The “Storage Availability Adjustment” shall be calculated as follows and applied to the Storage Capacity Payment due for the next month after the end of the monthly period for which the Monthly Storage Availability is calculated. (a) If the Monthly Storage Availability is greater than or equal to the Guaranteed Storage Availability, then:
Storage Availability Adjustment = 100% (expressed as a decimal) Exhibit M - 4
Exhibit N - 1
EXHIBIT N
STORAGE CAPACITY TESTS
Storage Capacity Test Notice and Frequency
A. Commercial Operation Storage Capacity Test(s). Upon no less than ten (10) Business Days’ prior Notice to Buyer, Seller shall schedule and complete a Commercial Operation Storage Capacity Test prior to the Commercial Operation Date. Such initial Commercial Operation Storage Capacity Test (and any subsequent Commercial Operation Storage Capacity Test permitted in accordance with Exhibit B) shall be performed in accordance with this Exhibit N and shall establish the Installed Storage Capacity hereunder based on the actual capacity and capabilities of the Storage Facility determined by such Storage Capacity Test(s).
B. Subsequent Storage Capacity Tests. Following the Commercial Operation Storage Capacity Test(s), at least fifteen (15) days in advance of the start of each Contract Year, upon no less than ten (10) Business Days’ prior Notice to Buyer, Seller shall schedule and complete a Storage Capacity Test. In addition, Buyer shall have the right to require a retest of the Storage Capacity Test at any time upon no less than five (5) Business Days prior Notice to Seller. Seller shall have the right to run a retest of any Storage Capacity Test at any time upon five (5) Business Days’ prior Notice to Buyer (or any shorter period reasonably acceptable to Buyer consistent with Prudent Operating Practice).
C. Test Results and Re-Setting of Storage Capacity. No later than five (5) days following any Capacity Test, Seller shall submit a testing report detailing results and findings of the test. The report shall include Storage Facility Meter readings and plant log sheets verifying the operating conditions and output of the Storage Facility. In accordance with Section 4.13(c) of the Agreement and Part II(I) below, after the Commercial Operation Storage Capacity Test(s), the Storage Capacity (up to, but not in excess of, the Installed Storage Capacity) determined pursuant to such Storage Capacity Test shall become the new Storage Capacity at the beginning of the first day following the completion of the test for calculating the Storage Capacity Payment and all other purposes under this Agreement.
Capacity Test Procedures
PART I. GENERAL.
(1) Each Capacity Test shall be conducted in accordance with Prudent Operating Practices, the Operating Restrictions and the provisions of this Exhibit N. For ease of reference, a Capacity Test is sometimes referred to in this Exhibit N as a “CT”.
Buyer or its representative may be present for the CT and may, for informational purposes only, use its own metering equipment (at Buyer’s sole cost). (2) Conditions Prior to Testing.
(1) EMS Functionality. The EMS shall be successfully configured to receive data from the Battery Management System (BMS), exchange Distributed Exhibit N - 2
Network Protocol 3 data with the Buyer SCADA device, and transfer data to the database server for the calculation, recording and archiving of data points.
(3) Commissioning Checklist. Commissioning shall be successfully completed per manufacturer guidance on all applicable installed Facility equipment, including verification that all controls, set points, and instruments of the EMS are configured.
PART II. REQUIREMENTS APPLICABLE TO ALL CAPACITY TESTS.
A. Test Elements. Each CT shall include the following individual test elements. The Parties acknowledge and agree that should Seller fall short of demonstrating one or more of the Test Elements as specified below, the CT will still be deemed “complete,” and any adjustments necessary to the Storage Capacity resulting from such CT, if applicable, will be made in accordance with this Exhibit N. (1) Electrical output at the lesser of the maximum discharging level (MW) and Guaranteed Storage Capacity for four (4) continuous hours; and (2) Electrical input at maximum charging level at the Storage Facility Meter (MW), as sustained until the SOC reaches at least 90%, continued by the electrical input at a rate up to the maximum charging level at the Storage Facility Meter (MW), as sustained until the SOC reaches 100%, not to exceed five (5) hours of total charging time.
(3) The dispatch of the Storage Facility during the CT shall only be done through the ADS signal from the CAISO to the Storage Facility. Seller shall not interfere with or alter the Storage Facility’s response to the ADS signal during the CT or manually alter any EMS or SCADA data recorded by the Storage Facility.
B. Parameters. During each CT, the following parameters shall be measured and recorded simultaneously for the Storage Facility, at two (2) second intervals:
(1) Time;
(2) The amount of Charging Energy;
(3) The amount of Discharging Energy;
(4) SOC; and
(5) Station Use.
Exhibit N - 3
C. Site Conditions. During each CT, the following conditions at the Site shall be measured and recorded simultaneously at thirty (30) minute intervals:
(1) Relative humidity (%);
(2) Barometric pressure (inches Hg) near the horizontal centerline of the Storage Facility; and
(3) Ambient air temperature (°F).
D. Test Showing. Each CT shall record and report the following datapoints:
(1) That the CT successfully started;
(2) The maximum sustained discharging level for four (4) consecutive hours pursuant to A(1) above;
(3) The maximum sustained charging level for four (4) consecutive hours pursuant to A(2) above;
(4) Amount of time between the Storage Facility’s electrical output going from 0 to the maximum sustained discharging level registered during the CT (for purposes of calculating the ramp rate);
(5) Amount of time between the Storage Facility’s electrical input going from 0 to the maximum sustained charging level registered during the CT (for purposes of calculating the ramp rate);
(6) Amount of Charging Energy to go from 0% SOC to 100% SOC; and (7) Amount of Discharging Energy to go from 100% SOC to 0% SOC.
E. Test Conditions.
(1) General. At all times during a CT, the Storage Facility shall be operated in compliance with Prudent Operating Practices, the Operating Restrictions, and all operating protocols recommended, required or established by the manufacturer for the Storage Facility.
(2) Abnormal Conditions. If abnormal operating conditions that prevent the testing or recordation of any required parameter occur during a CT, Seller may postpone or reschedule all or part of such CT in accordance with Part II.F below.
(3) Instrumentation and Metering. Seller shall provide all instrumentation, metering and data collection equipment required to perform the CT. The instrumentation, metering and data collection equipment electrical meters shall be calibrated in accordance with Prudent Operating Practice and, as Exhibit N - 4
applicable, the CAISO Tariff. At Buyer’s request, Seller shall provide documentation of all equipment calibration and certification. (4) Ambient Temperature. For tests requested by Buyer (and not for any CAISO-initiated test, which shall occur when directed by CAISO), the average ambient temperature, based on an aggregate of 1-minute resolution data collected throughout the SCT, must be within the range of 8 – 33 degrees Celsius.
F. Incomplete Test. If any CT is not completed in accordance herewith, Buyer may in its sole discretion: (i) accept the results up to the time the CT stopped without any modification to the Storage Capacity pursuant to Section I below; (ii) require that the portion of the CT not completed, be completed within a reasonable specified time period; or (iii) require that the CT be entirely repeated within a reasonable specified time period. Notwithstanding the above, if Seller is unable to complete a CT due to a Force Majeure Event or the actions or inactions of Buyer or the CAISO or the Transmission Provider, Seller shall be permitted to reconduct such CT on dates and at times reasonably acceptable to the Parties.
G. Test Report. Within five (5) Business Days after the completion of any CT, Seller shall prepare and submit to Buyer the completed Installed Capacity Certificate together with a written report of the results of the CT, which report shall include:
(1) A record of the personnel present during the CT that served in an operating, testing, monitoring or other such participatory role;
(2) The measured and calculated data for each parameter set forth in Part II.A through D and Part III below, including copies of the raw data taken during the test; and
(3) Seller’s statement of either Seller’s acceptance of the CT or Seller’s rejection of the CT results and reason(s) therefor.
Seller’s CT report and any submitted capacity certificate shall be deemed invalid if not delivered to Buyer within five (5) Business Days after the completion of any CT. Within five (5) Business Days after receipt of such report, Buyer shall notify Seller in writing of either Buyer’s acceptance of the CT results or Buyer’s rejection of the CT and reason(s) therefor.
If either Party rejects the results of any CT, such CT shall be repeated in accordance with Part II.F.
H. Supplementary Capacity Test Protocol. No later than sixty (60) days prior to any CT, Buyer may deliver to Seller for its review and approval (such approval not to be unreasonably delayed or withheld) a supplement to this Exhibit N with additional and supplementary details, procedures and requirements applicable to Capacity Tests based on the then-current design of the Storage Facility (“Supplementary Capacity Test Protocol”). Any additional Supplementary Exhibit N - 5
Capacity Test Protocol (and each update thereto), once approved by Seller, shall be deemed an amendment to this Exhibit N.
I. Adjustment to Storage Capacity. The Storage Capacity shall equal the quotient of (a) the total amount of Discharging Energy delivered to the Delivery Point (expressed in MWh AC) during the first four (4) hours of discharge (up to, but not in excess of, the product of (i) (A) the Guaranteed Storage Capacity (in the case of a Commercial Operation Storage Capacity Test, including under Section 5 of Exhibit B) or (B) the Installed Storage Capacity (in the case of any other Storage Capacity Test), multiplied by (ii) four (4) hours) divided by (b) four (4) hours, expressed in MW AC.
PART III –CAPACITY TEST PROTOCOL.
A. Storage Capacity
• Procedure:
(1) System Starting State: The Storage Facility will be in the on-line state at 0% SOC.
(2) Record the initial value of the Storage Facility SOC. (3) Command via ADS signal a real power charge that results in an AC power of Storage Facility’s maximum charging level, and continue charging until the earlier of (a) the Storage Facility has reached 100% SOC or (b) five (5) hours have elapsed since the Storage Facility commenced charging. (4) Record and store the Storage Facility SOC after the earlier of (a) the Storage Facility has reached 100% SOC or (b) five (5) hours of continuous charging.
Such data point shall be used for purposes of calculation of the Battery Charging Factor.
(5) Record and store the Charging Energy.
(6) Following an agreed-upon rest period, command via ADS signal a real power discharge that results in an AC power output of the lesser of (i) the Storage Facility’s maximum discharging level and (ii) the Guaranteed Storage Capacity, and maintain the discharging state until the earlier of (a) the Facility has discharged at the maximum discharging level for four (4) consecutive hours, (b) the Storage Facility has reached 0% SOC, or (c) the sustained discharging level is at least 2% less than the lesser of (i) the maximum discharging level and (ii) the Guaranteed Storage Capacity. (7) Record and store the Storage Facility SOC after four (4) hours of continuous discharging.
Exhibit N - 6
(8) Record and store the Discharging Energy as measured at the Storage Facility Meter. Such data point shall be used for purposes of calculation the effective Storage Capacity.
(9) If the Storage Facility has not reached 0% SOC pursuant to Section III.A.6, continue discharging the Storage Facility until it reaches a 0% SOC. Record and store the additional Discharging Energy, if applicable. • Test Results
(1) The resulting effective Storage Capacity measurement is the quotient of (a) the total Discharging Energy at the Storage Facility Meter pursuant to Part III Section A(8) above, divided by (b) four (4) hours.
Exhibit O - 1
EXHIBIT O - 1
OPERATING RESTRICTIONS
Ramp Rates: Dmin to Dmax: up to 100%/s
Cmin to Cmax: up to 100%/s
Dmax to Dmin: up to 100%/s
Cmax to Cmin: up to 100%/s
Frequency ramp rate: 100% MW/Hz
Regulation ramp rate: 345 MW/min
System Response Time: Idle to Dmax: <1s
Idle to Cmax: <1s
Dmax to Cmax: <1s
Cmax to Dmax: <1s
Dmin to Cmin: <1s
Cmin to Dmin: <1s
Exhibit O - 4
Maximum Stored Energy Level:
Minimum Stored Energy Level: 0 MWh, number in MWh representing the lowest level to which the Storage Facility may be discharged
Maximum Charging Capacity: 45.74 MW, number in MW representing the highest level to which the Storage Facility may be charged
Minimum Charging Capacity: 0.01 MW, number in MW representing the lowest level at which the Storage Facility may be charged
Maximum Discharging Capacity: 45.74 MW, number in MW representing the highest level at which the Storage Facility may be discharged
Minimum Discharging Capacity: 0 MW, number in MW representing the lowest level at which the Storage Facility may be discharged
Maximum State of Charge (SOC)
during Charging:
100%
Minimum State of Charge (SOC)
during Discharging:
0%
Ramp Rate: Between 0 and 345 MW/minute
Exhibit P - 1
EXHIBIT P
METERING DIAGRAM
Exhibit Q - 1
EXHIBIT Q
RTE SHORTFALL PAYMENTS
In the event that the RTEM is less than the GRTE, the monthly Storage Capacity Payment under Section 3.3(e) shall be reduced by the “RTE Shortfall Payment”, calculated as follows:
(GRTE – RTEM) x Average Monthly T4B5 Price x RTEFM x TCEM where:
GRTE = the Guaranteed Round-Trip Efficiency
RTEM = the “Round-Trip Efficiency”, as calculated by dividing (a) the total Discharging Energy for the applicable month by (b) the difference of (i) the total Charging Energy for the applicable month, minus (ii) Reimbursable Station Use for the applicable month The “Average Monthly T4B5 Price” means the average of the four (4) highest hourly average Day-Ahead Market LMPs and the five (5) lowest hourly average Day-Ahead Market LMPs, in each case in the applicable month.
The “Round-Trip Efficiency Factor” or “RTEFM” for each month is determined as follows:
If RTEM > GRTE, then RTEFM = 0
If RTEM < GRTE and RTEM > 70%, then RTEFM = 1.2
If RTEM < 70%, then RTEFM = 1.5
TCEM = the total Charging Energy charged to the Storage Facility in the applicable month.
Exhibit R - 2
IP Darden III, LLC, a Delaware limited
liability company (“Seller”)
PENINSULA CLEAN ENERGY, a California
joint powers authority (“Buyer”)
Exhibit S - 1
EXHIBIT S
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 ifsuch 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 islikely 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 Exhibit S - 2
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 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, workersshall be compensated for overtime at pay rates greaterthan 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 identityand 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 Exhibit S - 3
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
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.
Exhibit T - 1
Version as of July 23, 2025
POWER PURCHASE AND SALE AGREEMENT
Seller:
Buyer:
COVER SHEET
IP Darden IV, LLC, a Delaware limited liability company Peninsula Clean Energy Authority, a California joint powers authority Description of Generating Facility and Storage Facility: A separately metered 42.28 MW solar photovoltaic electric generating facility located in Fresno County, California, plus a separately metered 167.36 MWh and 41.84 MW AC energy storage facility with at least four (4) hours of continuous discharging at the maximum rate of discharge, located at the same Site as the Generating Facility in Fresno County, California.
Guaranteed Commercial Operation Date: June 1, 2028
Milestones:
Milestone Expected Completion Date
Site Control Complete
Conditional Use Permit Complete
Phase II Interconnection Study Results Complete
Obtain Full Capacity Deliverability Status Allocation Complete Executed Interconnection Agreement Complete
Procure Major Equipment Complete
Financial Close 3/1/2026
Construction Start 6/1/2027
Initial Synchronization 1/1/2028
Deliverability Network Upgrades completed Complete
CAISO Commercial Operation 5/1/2028
Commercial Operation Date 6/1/2028
Delivery Term: 10 Contract Years; provided, Seller shall have the right, upon delivery of Notice to Buyer on or before November 30, 2025, to increase the Delivery Term to twelve (12) Contract Years.
Delivery Term Expected Energy:
Contract Year Expected Energy (MWh)
1 2
3 4
5 6
7 8
9 10
11 [If Applicable]
12 [If Applicable]
Monthly Expected Energy:
1 Month Expected Energy (MWh)
January
1 This table reflects Seller’s Expected Energy by calendar month in the first Contract Year, as if the first Contract Year begins on January first. The first Contract Year may begin on another date, per the terms of this Agreement.
Month Expected Energy (MWh)
February
March
April
May
June
July
August
September
October
November
December
Guaranteed Storage Capacity:
Contract Years Storage Rate ($/kW-month)
All
Guaranteed Storage Availability:
Product:
x PV Energy
x Discharging Energy
x Green Attributes: Portfolio Content Category 1
x Future Environmental Attributes
x Capacity Attributes
x Storage Product
Scheduling Coordinator: Seller prior to Commercial Operation; Buyer or Buyer’s agent following Commercial Operation.
Development Security: $105/kW of Guaranteed PV Capacity and Guaranteed Storage Capacity.
Performance Security: $105/kW of Installed PV Capacity and Installed Storage Capacity. [Signatures on following page.]
IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed as of the Effective Date.
SELLER
IP Darden IV, LLC
By:
Name:
Title:
BUYER
Peninsula Clean Energy Authority
By:
PCE Executive Officer
i
TABLE OF CONTENTS
Page
ARTICLE 1 DEFINITIONS........................................................................................................ 1
1.1 Contract Definitions................................................................................................ 1
1.2 Rules of Interpretation .......................................................................................... 23 ARTICLE 2 TERM; CONDITIONS PRECEDENT............................................................... 25
2.1 Contract Term....................................................................................................... 25
2.2 Conditions Precedent ............................................................................................ 26
2.3 Development; Construction; Progress Reports..................................................... 28
2.4 Remedial Action Plan ........................................................................................... 28
2.5 Facility Configuration........................................................................................... 28 ARTICLE 3 PURCHASE AND SALE ..................................................................................... 29
3.1 Sale of Product...................................................................................................... 29
3.2 Sale of Green Attributes........................................................................................ 30
3.3 Compensation ....................................................................................................... 30
3.4 Imbalance Energy ................................................................................................. 31
3.5 Ownership of Renewable Energy Incentives........................................................ 31
3.6 Future Environmental Attributes .......................................................................... 31
3.7 Test Energy ........................................................................................................... 32
3.8 Capacity Attributes ............................................................................................... 32
3.9 Resource Adequacy Failure .................................................................................. 33
3.10 CEC Certification and Verification ...................................................................... 34
3.11 Eligibility .............................................................................................................. 34
3.12 California Renewables Portfolio Standard............................................................ 35
3.13 Compliance Expenditure Cap ............................................................................... 35 Guaranteed Interconnection Capacity................................................................... 36
3.15 CPUC Mid-Term Reliability Requirements ......................................................... 36
3.16 Buyer’s Re-Sale of Product .................................................................................. 36 ARTICLE 4 OBLIGATIONS AND DELIVERIES................................................................. 37
4.1 Delivery................................................................................................................. 37
4.2 Title and Risk of Loss........................................................................................... 37
4.3 Scheduling Coordinator Responsibilities.............................................................. 37
4.4 Forecasting............................................................................................................ 39
4.5 Dispatch Down/Curtailment ................................................................................. 40
4.6 Charging and Discharging Energy........................................................................ 42
4.7 Reduction in Delivery Obligation......................................................................... 44
4.8 Expected Energy and Guaranteed Energy Production.......................................... 44
4.9 WREGIS ............................................................................................................... 45
4.10 Financial Statements............................................................................................. 46
4.11 Access to Data....................................................................................................... 46
4.12 Storage Availability and Efficiency...................................................................... 49 ii
4.13 Storage Capacity Tests.......................................................................................... 49
4.14 Storage Facility Modifications.............................................................................. 49
4.15 Ancillary Services................................................................................................. 50
4.16 Workforce Agreement .......................................................................................... 50
4.17 Diverse Business Enterprises. During the Delivery Term, n................................ 50
4.18 Shared Facilities.................................................................................................... 51 ARTICLE 5 TAXES................................................................................................................... 51
5.1 Allocation of Taxes and Charges.......................................................................... 51
5.2 Cooperation........................................................................................................... 51
5.3 Ownership............................................................................................................. 52 ARTICLE 6 MAINTENANCE OF THE FACILITY ............................................................. 52
6.1 Maintenance of the Facility .................................................................................. 52
6.2 Maintenance of Health and Safety........................................................................ 53
6.3 Permits and Approvals.......................................................................................... 53
6.4 Energy to Serve Station Use ................................................................................. 53 ARTICLE 7 METERING.......................................................................................................... 54
7.1 Metering................................................................................................................ 54
7.2 Meter Verification................................................................................................. 55 ARTICLE 8 INVOICING AND PAYMENT; CREDIT......................................................... 55
8.1 Invoicing ............................................................................................................... 55
8.2 Payment................................................................................................................. 55
8.3 Books and Records ............................................................................................... 56
8.4 Payment Adjustments; Billing Errors................................................................... 56
8.5 Billing Disputes .................................................................................................... 56
8.6 Netting of Payments.............................................................................................. 57
8.7 Seller’s Development Security ............................................................................. 57
8.8 Seller’s Performance Security............................................................................... 57
8.9 First Priority Security Interest in Cash or Cash Equivalent Collateral ................. 57 ARTICLE 9 NOTICES .............................................................................................................. 58
9.1 Addresses for the Delivery of Notices.................................................................. 58
9.2 Acceptable Means of Delivering Notice............................................................... 58 ARTICLE 10 FORCE MAJEURE............................................................................................ 59
10.1 Definition .............................................................................................................. 59
10.2 No Liability If a Force Majeure Event Occurs ..................................................... 60
10.3 Notice.................................................................................................................... 60
10.4 Termination Following Force Majeure Event....................................................... 60 iii
ARTICLE 11 DEFAULTS; REMEDIES; TERMINATION ................................................. 60
11.1 Events of Default .................................................................................................. 60
11.2 Remedies; Declaration of Early Termination Date............................................... 63
11.3 Damage Payment; Termination Payment ............................................................. 64
11.4 Notice of Payment of Termination Payment ........................................................ 65
11.5 Disputes With Respect to Termination Payment.................................................. 65
11.6 Limitation on Seller’s Ability to Make or Agree to Third-Party Sales from the Facility after Early Termination Date ............................................................. 65
11.7 Rights And Remedies Are Cumulative................................................................. 65
11.8 Mitigation.............................................................................................................. 66 ARTICLE 12 LIMITATION OF LIABILITY AND EXCLUSION OF
WARRANTIES............................................................................................. 66
12.1 No Consequential Damages.................................................................................. 66
12.2 Waiver and Exclusion of Other Damages............................................................. 66 ARTICLE 13 REPRESENTATIONS AND WARRANTIES; AUTHORITY...................... 67
13.1 Seller’s Representations and Warranties .............................................................. 67
13.2 Buyer’s Representations and Warranties.............................................................. 68
13.3 General Covenants................................................................................................ 68 ARTICLE 14 ASSIGNMENT ................................................................................................... 69
14.1 General Prohibition on Assignments.................................................................... 69
14.2 Permitted Assignment; Change of Control of Seller ............................................ 69
14.3 Permitted Assignment; Change of Control of Buyer............................................ 69
14.4 Buyer Financing Assignment................................................................................ 69 ARTICLE 15 LENDER ACCOMMODATIONS.................................................................... 70
15.1 Granting of Lender Interest................................................................................... 70
15.2 Rights of Lender ................................................................................................... 70
15.3 Cure Rights of Lender........................................................................................... 71 ARTICLE 16 DISPUTE RESOLUTION ................................................................................. 71
16.1 Governing Law ..................................................................................................... 71
16.2 Dispute Resolution................................................................................................ 71
16.3 Attorneys’ Fees..................................................................................................... 71
16.4 Venue .................................................................................................................... 71 ARTICLE 17 INDEMNIFICATION........................................................................................ 72
17.1 Indemnification..................................................................................................... 72
17.2 Claims................................................................................................................... 72 iv
ARTICLE 18 INSURANCE....................................................................................................... 72
18.1 Insurance ............................................................................................................... 72 ARTICLE 19 CONFIDENTIAL INFORMATION ................................................................ 73
19.1 Definition of Confidential Information................................................................. 73
19.2 Duty to Maintain Confidentiality.......................................................................... 74
19.3 Irreparable Injury; Remedies ................................................................................ 74
19.4 Disclosure to Lender............................................................................................. 74
19.5 Disclosure to Credit Rating Agency ..................................................................... 74
19.6 Public Statements.................................................................................................. 75 ARTICLE 20 MISCELLANEOUS ........................................................................................... 75
20.1 Entire Agreement; Integration; Exhibits............................................................... 75
20.2 Amendments......................................................................................................... 75
20.3 Time is of the Essence. ......................................................................................... 75
20.4 No Waiver............................................................................................................. 75
20.5 No Agency, Partnership, Joint Venture or Lease.................................................. 75
20.6 Severability ........................................................................................................... 75
20.7 Mobile-Sierra ........................................................................................................ 75
20.8 Counterparts.......................................................................................................... 76
20.9 Facsimile or Electronic Delivery .......................................................................... 76
20.10 Binding Effect....................................................................................................... 76
20.11 No Recourse to Members of Buyer ...................................................................... 76
20.12 Change in Electric Market Design........................................................................ 76 ARTICLE 21 CPUC MODIFIABLE STANDARD CONTRACT TERMS.......................... 77
21.1 STC 2: Bioenergy Transactions............................................................................ 77
21.2 STC 4: Confidentiality.......................................................................................... 77
21.3 STC 5: Contract Term........................................................................................... 78
21.4 STC 7: Performance Standards/Requirements...................................................... 79
21.5 STC 8: Product Definitions................................................................................... 82
21.6 STC 9: Non-Performance or Termination Penalties and Default Provisions....... 82
21.7 STC 12: Credit Terms........................................................................................... 87
21.8 STC 15: Contract Modifications........................................................................... 93
21.9 STC 16: Assignment............................................................................................. 93
21.10 STC 18: Application of Prevailing Wage ............................................................. 93 EXHIBITS:
Exhibit A Description of Facility
Exhibit B Facility Construction and Commercial Operation Exhibit C [Intentionally Omitted]
Exhibit D Guaranteed Energy Production Damages Calculation Exhibit E Progress Reporting Form
Exhibit F Buyout Option
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Exhibit G-1 Form of Commercial Operation Date Certificate Exhibit G-2 Form of Installed Capacity Certificate
Exhibit H Form of Construction Start Date Certificate
Exhibit I Form of Letter of Credit
Exhibit J Insurance
Exhibit K Form of Replacement RA Notice
Exhibit L L-1 Annual Energy Forecast
L-2 Monthly Expected Available Generating Capacity
L-3 Monthly Expected Available Storage Capacity
L-4 Monthly Expected PV Energy
Exhibit M Monthly Storage Availability
Exhibit N Storage Capacity Tests
Exhibit O Operating Restrictions
Exhibit P Metering Diagram
Exhibit Q RTE Shortfall Payments
Exhibit R Notices
Exhibit S Supply Chain Code of Conduct
POWER PURCHASE AND SALE AGREEMENT
This Power Purchase and Sale Agreement (“Agreement”) is entered into as of [_______________] (the “Effective Date”), between Seller and Buyer (each also referred to as a “Party” and collectively as the “Parties”).
RECITALS
WHEREAS, Seller intends to develop, design, construct, own or otherwise have control over, and operate the electric generating and energy storage facility as described in Exhibit A; and WHEREAS, Seller desires to sell, and Buyer desires to purchase, on the terms and conditions set forth in this Agreement, all Energy generated by the Generating Facility, all Green Attributes related to the generation of such Energy, all Capacity Attributes from the Facility, and all Storage 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 3.13. “Adjusted Energy Production” has the meaning set forth in Exhibit D.
“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. “AGC” has the meaning set forth in the CAISO Tariff.
“Aggregate Capability Constraint” has the meaning set forth in the CAISO Tariff. 2 “Agreement” has the meaning set forth in the Preamble and includes the Cover Sheet and any exhibits, schedules and any written supplements hereto. “Ancillary Services” means ancillary services as defined in the CAISO Tariff that are associated with the Storage Facility and that the Facility is capable of providing consistent with the Operating Restrictions , including Spinning Reserve, Non-Spinning Reserve, Regulation Up, and Regulation Down (as each is defined in the CAISO Tariff). “Assignment Agreement” has the meaning set forth in Section 14.4. “Attestation” has the meaning set forth in Section 4.1(b). “Automated Dispatch System” or “ADS” has the meaning set forth in the CAISO Tariff. “Availability Incentive Payment” has the meaning set forth in the CAISO Tariff. “Availability Notice” means the lower of (a) Seller’s availability forecasts issued and updated pursuant to Section 4.4 with respect to the Available Storage Capacity and Available Storage Capability, and (b) availability information reported to CAISO through OMS. “Available Generating Capacity” means the capacity from the Generating Facility, expressed in whole MWs, that is available at a particular time to generate Energy. “Available Storage Capability” has the meaning defined in Exhibit M. “Available Storage Capacity” has the meaning defined in Exhibit M. “Bankrupt” means with respect to any entity, such entity that (a) files a petition or otherwise commences, authorizes or acquiesces in the commencement of a proceeding or cause of action under any bankruptcy, insolvency, reorganization or similar Law, (b) has any such petition filed or commenced against it which remains unstayed or undismissed for a period of ninety (90) days, (c) makes an assignment or any general arrangement for the benefit of creditors, (d) otherwise becomes bankrupt or insolvent (however evidenced), (e) has a liquidator, administrator, receiver, trustee, conservator or similar official appointed with respect to it or any substantial portion of its property or assets, or (f) is generally unable to pay its debts as they fall due. “Bid” has the meaning set forth in the CAISO Tariff.
“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 14.4. “Buyer Bid Curtailment” means any curtailment of the Generating Facility arising out of or resulting from the manner in which Buyer bids, offers or schedules the Generating Facility, the 3 Energy or any Products, or in which Buyer fails to do so, where either all of the following (a) through (c) occurs, or (d) occurs:
(a) the CAISO provides notice, including through ADS, to a Party or the Scheduling Coordinator for the Generating Facility, requiring the Party to deliver less PV Energy from the Generating Facility than is reflected in the VER Forecast for the Generating Facility for a period of time;
(b) for the same time period as referenced in (a), Buyer or the Scheduling Coordinator for the Facility:
(i) did not submit a Self-Schedule or an Energy Supply Bid for the MW subject to the reduction; or
(ii) submitted an Energy Supply Bid and the CAISO notice referenced in (a) is solely a result of CAISO implementing the Energy Supply Bid; or (iii) submitted a Self-Schedule for less than the full amount of VER Forecast for the Generating Facility; and
(c) no other circumstances exist that constitute a Scheduled Maintenance, Forced Facility Outage, Force Majeure Event and/or a Curtailment Period during the same time period as referenced in (a); or
(d) during a period when all of the following occur: (i) Buyer submitted a Bid or Self-Schedule for Ancillary Services with respect to the Storage Facility for such Settlement Interval, (ii) is awarded an Ancillary Services Schedule by the CAISO with respect to Storage Facility for such Settlement Interval, (iii) the Generating Facility is instructed by the CAISO to follow the Dispatch Operating Target (as defined in the CAISO Tariff) other than due to a Curtailment Order, and (iv) the Generating Facility would have generated PV Energy in excess of the Dispatch Operating Target but for such instruction from the CAISO. “Buyer Curtailment Order” means the instruction from Buyer to Seller to reduce delivery of PV Energy by the amount, and for the period of time set forth in such order, for reasons unrelated to a Scheduled Maintenance, Forced Facility Outage, Force Majeure Event and/or Curtailment Order, which instruction may be communicated to Seller in writing by electronic notice or other commercially reasonable means.
“Buyer Curtailment Period” means the period of time, as measured using current Settlement Intervals, during which Seller reduces delivery of PV Energy pursuant to or as a result of (i) Buyer Bid Curtailment or (ii) a Buyer Curtailment Order. 4 “Buyer Default” means a Buyer Event of Default.
“Buyer’s WREGIS Account” has the meaning set forth in Section 4.9(a). “CAISO” means the California Independent System Operator Corporation or any successor entity performing similar functions.
“CAISO Approved Meter” means a CAISO approved revenue quality meter or meters, CAISO approved data processing gateway or remote intelligence gateway, telemetering equipment and data acquisition services sufficient for monitoring, recording and reporting, in real time all Energy delivered by the Facility to the Delivery Point adjusted for or net of Electrical Losses and Station Use, in accordance with the CAISO Tariff. “CAISO Certification” means the certification and testing requirements for a storage facility, such as the Facility, as set forth in the CAISO Tariff that are applicable to the Facility, including certification and testing for all Ancillary Services, PMAX, and PMIN associated with such storage facility, that are applicable to the Facility. “CAISO Charges Invoice” has the meaning set forth in Section 4.3(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 No Pay” has the meaning for the term “No Pay” as set forth in the CAISO Tariff. “CAISO Operating Order” means the “operating order” defined in Section 37.2.1.1 of the CAISO Tariff.
“CAISO-Penalized Shortfall” has the meaning set forth in Section 3.9(b)(ii). “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.
“Calculation Interval” has the meaning set forth in Exhibit M. “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) codified in, inter alia, California Public Utilities Code Sections 399.11 through 399.31 and California Public Resources Code Sections 25740 through 25751, as such provisions are amended or supplemented from time to time. “Capacity Attribute” means any current or future defined characteristic, certificate, tag, credit, or accounting construct associated with the amount of Energy that the Facility can generate 5 and/or deliver to the Delivery Point at a particular moment and that can be purchased, sold, traded or used for a Person’s legal or regulatory compliance under the CPUC or CAISO market rules, including Resource Adequacy Benefits and MTR Attributes. “Capacity Damages” has the meaning set forth in Exhibit B. “Capacity Test” or “CT” means the Commercial Operation Storage Capacity Test, Storage Capacity Test, or any other test conducted pursuant to Exhibit N. “CEC” means the California Energy Commission or its successor agency. “CEC Final Certification and Verification” means that the CEC has certified the Generating Facility as an Eligible Renewable Energy Resource for purposes of the California Renewables Portfolio Standard, meeting all applicable requirements for certified facilities set forth in the RPS Eligibility Guidebook, Ninth Edition (or its successor), and that all Energy generated by the Generating Facility qualifies as generation from an Eligible Renewable Energy Resource. “CEC Precertification” means that the CEC has issued a precertification for the Generating Facility indicating that the planned operations of the Generating Facility would comply with applicable CEC requirements for CEC Final Certification and Verification. “Change of Control”, in the case of Seller, means,
any circumstance in which Seller’s 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 its Ultimate Parent indirectly through one or more intermediate entities shall not be counted towards the Ultimate Parent’s ownership interest in Seller unless the 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.
“Charging Energy”
“Charging Notice” means the operating instruction, and any subsequent updates, given by Buyer or the CAISO, directing the Storage Facility to charge at a specific MW rate to a specified Stored Energy Level; provided, any such operating instruction shall be in accordance with Section
4.6, the Operating Restrictions and the CAISO Tariff. Any Charging Notice shall not constitute a Buyer Bid Curtailment, Buyer Curtailment Order, or Curtailment Order. 6 “Co-located Resource” has the meaning set forth in the CAISO Tariff. “Commercial Operation” has the meaning set forth in Exhibit B. “Commercial Operation Date” has the meaning set forth in Exhibit B. “Commercial Operation Delay Damages” means an amount equal to (a) the Development Security amount required hereunder, divided by (b) ninety (90). “Commercial Operation Storage Capacity Test” means the Storage Capacity Test conducted in connection with Commercial Operation of the Storage Facility, including any additional Storage Capacity Test for additional Storage Facility capacity installed after the Commercial Operation Date pursuant to Section 5 of Exhibit B. “Compliance Actions” has the meaning set forth in Section 3.13. “Compliance Expenditure Cap” has the meaning set forth in Section 3.13. “Confidential Information” has the meaning set forth in Section 19.1. “Construction Start” has the meaning set forth in Exhibit B. “Construction Start Date” has the meaning set forth in Exhibit B. “Contract Price” means each of the Renewable Rate and Storage Rate. “Contract Term” has the meaning set forth in Section 2.1(a). “Contract Year” means a period of twelve (12) consecutive months. The first Contract Year shall commence on the Commercial Operation Date, and each subsequent Contract Year shall commence on the anniversary of the Commercial Operation Date. “Control” (including, with correlative meanings, the terms “Controlled by” and “under common Control with”), as used with respect to any Person, shall mean the direct or indirect right to cast more than 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 more than fifty percent (50%) of the equity or other ownership interest in such Person. “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 or financed its obligations or entering into new arrangements which replace this 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.
“CPM Soft Offer Cap” has the meaning set forth in the CAISO Tariff. “CPUC” means the California Public Utilities Commission, or successor entity. 7 “CPUC-Penalized Shortfall” has the meaning set forth in Section 3.9(b)(i). “CPUC System RA Penalty” means the penalties for “System RA Deficiency” adopted by the CPUC in the Resource Adequacy Rulings.
“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, in either case by S&P or Moody’s. If ratings by S&P and Moody’s are not equivalent, the lower rating shall apply. “CRS” has the meaning set forth in Section 4.1(b).
“Curtailment Order” means any of the following:
(a) CAISO orders, directs, alerts, or provides notice to a Party, including a CAISO Operating Order, to curtail Energy deliveries for any reason other than a Buyer Bid Curtailment; (b) a curtailment ordered by the Participating Transmission Owner or distribution operator (if the Facility is interconnected to distribution or sub-transmission system) for reasons including, but not limited to, (i) any situation that affects normal function of the electric system including, but not limited to, any abnormal condition that requires action to prevent circumstances such as equipment damage, loss of load, or abnormal voltage conditions, or (ii) any warning, forecast or anticipation of conditions or situations that jeopardize the Participating Transmission Owner’s or distribution operator’s electric system integrity or the integrity of other systems to which the Participating Transmission Owner is connected; (c) a curtailment ordered by the Participating Transmission Owner due to scheduled or unscheduled maintenance on the Participating Transmission Owner’s transmission facilities that prevents either Party from receiving or delivering Energy to the Delivery Point; or (d) a curtailment in accordance with Seller’s obligations under its Interconnection Agreement with the Participating Transmission Owner or distribution operator.
If Buyer or Buyer’s Scheduling Coordinator submitted a Self-Schedule and/or an Energy Supply Bid in its final CAISO market participation in respect of a given time period that clears, in full, the applicable CAISO market for the full amount of Energy forecasted to be produced by or delivered from the Facility for such time period, any notice from the CAISO having the effect of requiring a reduction during the same time period is a Curtailment Order, not a Buyer Bid Curtailment.
“Curtailment Period” means the period of time, as measured using current Settlement Intervals, during which Seller reduces energy from the Facility pursuant to a Curtailment Order. “Daily Delay Damages” means an amount equal to (a) the Development Security amount required hereunder, divided by (b) one hundred twenty (120). 8 “Damage Payment” means a liquidated damages payment 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 set forth in Section 11.3(a). “Day-Ahead Forecast” has the meaning set forth in Section 4.4(c). “Day-Ahead LMP” means the LMP for the Day-Ahead Market. “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 that qualifies as PCC1, expressed in MWh, that the Generating Facility would have produced and delivered to the Delivery Point, but that is not produced by the Generating Facility and delivered to the Delivery Point during a Buyer Curtailment Period, which amount shall be equal to (a) the VER Forecast expressed in MWh, applicable to the Buyer Curtailment Period, or (b) if there is no VER Forecast available or Seller demonstrates to Buyer’s reasonable satisfaction that the VER Forecast does not represent an accurate forecast of generation from the Generating Facility, the amount determined by a third party reasonably acceptable to Buyer using an industry standard forecasting or back-casting methodology to determine the potential generation of the Generating Facility as a function of Available Generating Capacity, solar insolation and panel temperature, and other pertinent data for the period of time during the Buyer Curtailment Period, in either case less the amount of PV Energy delivered to the Delivery Point during the Buyer Curtailment 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 4.9(e). “Delivery Point” means the PNode designated by the CAISO for the Generating Facility and the PNode designated by the CAISO for the Storage Facility, as applicable. “Delivery Term” shall mean the period of Contract Years specified 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 (i) cash or (ii) a Letter of Credit in the amount specified for the Development Security on the Cover Sheet, deposited with Buyer in conformance with Section 8.7.
“Discharging Energy”
9 “Discharging Notice” means the operating instruction, and any subsequent updates, given by Buyer or CAISO to Seller, instructing the Storage Facility to discharge Discharging Energy at a specific MWh rate to a specified Stored Energy Level, provided, any such operating instruction or updates shall be in accordance with Section 4.6, the Operating Restrictions and the CAISO Tariff.
“Diverse Business Enterprises” means a women, minority, disabled veteran, lesbian, gay, bisexual and /or transgender business enterprise, as more particularly set forth in CPUC General Order 156.
“Early Termination Date” has the meaning set forth in Section 11.2. “Effective Date” has the meaning set forth on the Preamble. “Electrical Losses” means all transmission or transformation losses between the Facility and the Delivery Point, including losses associated with (i) delivery of PV Energy to the Delivery Point, (ii) delivery of Charging Energy to the Storage Facility, and (iii) delivery of Discharging Energy to the Delivery Point.
“Eligible Intermittent Resources Protocol” or “EIRP” has the meaning set forth in the CAISO Tariff.
“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. “EMS” has the meaning set forth in the CAISO Tariff.
“Energy” means metered electrical energy measured in MWh. “Energy Supply Bid” has the meaning set forth in the CAISO Tariff. “Event of Default” has the meaning set forth in Section 11.1. “Excess MWh” has the meaning set forth in Section 3.3(c). “Expected Energy” has the meaning set forth in Section 4.8. “Facility” means the Generating Facility and the Storage Facility, as described more fully in Exhibit A attached hereto.
“Facility Energy” means the sum of PV Energy and Discharging Energy during any Settlement Interval or Settlement Period, as measured by the CAISO Approved Meter. “FERC” means the Federal Energy Regulatory Commission or any successor government agency.
“Flexible Capacity” has the meaning set forth in the CAISO Tariff. 10 “Flexible Capacity Category” has the meaning set forth in the CAISO Tariff. “Flexible Resource Adequacy Benefits” means the attributes, however defined, of a resource that can be used to satisfy the flexible resource adequacy obligations of a load serving entity, including Flexible Capacity.
“FMM Schedule” has the meaning set forth in the CAISO Tariff. “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 or any outage on the Transmission System that prevents Seller from generating or delivering power to the Delivery Point or providing Storage Product and that is not the result of a Force Majeure Event.
“Forward Certificate Transfers” has the meaning set forth in the WREGIS Operating Rules.
“Full Capacity Deliverability Status” or “FCDS” has the meaning set forth in the CAISO Tariff.
“Full Network Model” has the meaning set forth in the CAISO Tariff. “Future Environmental Attributes” shall mean any and all emissions, air quality or other environmental attributes (other than Green Attributes or Renewable Energy Incentives) 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) that are attributable, now, or in the future, to the generation of electrical energy by the Facility. Future Environmental Attributes do not include (i) any energy, capacity, reliability or other power attributes from the Facility, (ii) investment or production tax credits associated with the construction or operation of the Facility and other financial incentives in the form of credits, reductions, or allowances associated with the Facility that are applicable to a state or federal income taxation obligation, (iii) fuel-related subsidies or “tipping fees” that may be paid to Seller to accept certain fuels, or local subsidies received by the generator for the destruction of particular preexisting pollutants or the promotion of local environmental benefits, or (iv) emission reduction credits encumbered or used by the Facility for compliance with local, state, or federal operating and/or air quality permits. “Gains” means, with respect to any Party, an amount equal to the present value of the economic benefit to it, if any (exclusive of Costs), resulting from the termination of this Agreement for the remaining Contract Term, determined in a commercially reasonable manner. Factors used in determining the economic benefit to a Party may include, without limitation, reference to information supplied by one or more third parties, which shall exclude Affiliates of the Non-Defaulting Party, including without limitation, quotations (either firm or indicative) of relevant rates, prices, yields, yield curves, volatilities, spreads or other relevant market data in the relevant markets, comparable transactions, forward price curves based on economic analysis of the relevant 11 markets, settlement prices for comparable transactions at liquid trading hubs (e.g., NP-15), all of which should be calculated for the remaining Contract Term, and includes the value of Green Attributes and Capacity Attributes.
“Generating Facility” means the separately metered 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 PV Energy to the Delivery Point, including Seller’s rights and interests in Shared Facilities; provided, the “Generating Facility” does not include the Storage Facility or the portions of Shared Facilities other than Seller’s rights and interests thereto.
“Generating Facility Meter” means the CAISO Approved Meter (with a 0.3 accuracy class), sufficient for monitoring, recording and reporting, in real time, the amount of PV Energy generated by the Generating Facility and calculated as delivered to Buyer at the Delivery Point.
For clarity, the Generating Facility may contain multiple measurement devices and calculations that will make up the Generating Facility Meter, and, unless otherwise indicated, references to the Generating Facility Meter shall mean all such measurement devices and calculations and the aggregated data of all such measurement devices and calculations, taken together. “GHG Regulations” means Title 17, Division 3 (Air Resources), Chapter 1 (Air Resources Board), Subchapter 10 (Climate Change), Article 5 (Emissions Cap), Sections 95800 to 96023 of the California Code of Regulations, as amended or supplemented from time to time. “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; 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, attributable to the generation from the Facility, and its displacement of conventional Energy generation. Green Attributes include but are not limited to Renewable Energy Credits, as well as: (1) any avoided emissions of pollutants to the air, soil or water such as sulfur oxides (SOx), nitrogen oxides (NOx), carbon monoxide (CO) and other pollutants; (2) any avoided emissions of carbon dioxide (CO2), methane (CH4), nitrous oxide, hydrofluorocarbons, perfluorocarbons, sulfur hexafluoride and other greenhouse gases (GHGs) that have been determined by the United Nations Intergovernmental Panel on Climate Change, or otherwise by Law, to contribute to the actual or potential threat of altering the Earth’s climate by trapping heat in the atmosphere; (3) the reporting rights to these avoided emissions, such as Green Tag Reporting Rights. Green Tags are accumulated on a MWh basis and one Green Tag represents the Green Attributes associated with one (1) MWh of Energy. Green Attributes do not include (i) any energy, capacity, reliability or other power attributes from the Facility, (ii) investment or production tax credits associated with the construction or operation of the Facility and other financial incentives in the form of credits, reductions, or allowances associated with the Facility that are applicable to a state or federal income taxation obligation, (iii) fuel-related subsidies or “tipping fees” that may be paid to Seller to accept certain fuels, or local subsidies received by the generator for the destruction of particular preexisting pollutants or the promotion of local 12 environmental benefits, or (iv) emission reduction credits encumbered or used by the Facility for compliance with local, state, or federal operating and/or air quality permits. If the Facility is a biomass or landfill gas facility and Seller receives any tradable Green Attributes based on the greenhouse gas reduction benefits or other emission offsets attributed to its fuel usage, it shall provide Buyer with sufficient Green Attributes to ensure that there are zero net emissions associated with the production of electricity from the Facility. “Green Tag Reporting Rights” means the right of a purchaser of renewable energy to report ownership of accumulated “green tags” in compliance with and to the extent permitted by applicable Law and include, without limitation, rights under Section 1605(b) of the Energy Policy Act of 1992, and any present or future federal, state or local certification program or emissions trading program, including pursuant to the WREGIS Operating Rules. “Greenhouse Gas” or “GHG” has the meaning set forth in the GHG Regulations or in any other applicable Laws.
“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 3.5, updated December 15, 2020, as may be further amended from time to time. “Guaranteed Commercial Operation Date” has the meaning set forth in Exhibit B. “Guaranteed Construction Start Date” has the meaning set forth in Exhibit B. “Guaranteed Energy Production” has the meaning set forth in Section 4.8. “Guaranteed Interconnection Capacity” means the interconnection rights provided under the Interconnection Agreement in the amount set forth on the Cover Sheet. “Guaranteed PV Capacity” means the amount set forth on the Cover Sheet, as may be adjusted pursuant to Exhibit G-2.
“Guaranteed RA Capacity” means the Guaranteed Storage Capacity. “Guaranteed Round-Trip Efficiency” means the minimum guaranteed Round-Trip Efficiency of the Storage Facility required during each month commencing upon Commercial Operation and continuing throughout the Delivery Term, as set forth on the Cover Sheet. “Guaranteed Storage Availability” has the meaning set forth on the Cover Sheet. “Guaranteed Storage Capacity” has the meaning set forth on the Cover Sheet, as may be adjusted pursuant to Exhibit B.
13 “Imbalance Energy” means the amount of Energy, in any given Settlement Period or Settlement Interval, by which the amount of Facility Energy deviates from the amount of Scheduled Energy, including Uninstructed Imbalance Energy (as defined in the CAISO Tariff). “Indemnified Party” has the meaning set forth in Section 17.1. “Indemnifying Party” has the meaning set forth in Section 17.1. “Initial Synchronization” means the initial delivery of Energy from the Facility to the interconnection point specified in the Interconnection Agreement. “Installed PV Capacity” means the actual generating capacity of the Facility, measured at the Facility PNode and adjusted for ambient conditions on the date of the performance test, not to exceed the Guaranteed PV Capacity, as evidenced by a certificate substantially in the form attached as Exhibit I-2 hereto provided by Seller to Buyer. “Installed Storage Capacity” means the maximum dependable operating capability of the Storage Facility to discharge electric energy for four (4) consecutive hours at the maximum discharge rate (up to but not in excess of the Guaranteed Storage Capacity), as measured in MW at the Delivery Point, that achieves Commercial Operation, as evidenced by a certificate substantially in the form attached as Exhibit G-2 hereto provided by Seller to Buyer. “Inter-SC Trade” or “IST” has the meaning set forth in the CAISO Tariff. “Interconnection Agreement” means the interconnection agreement entered into by Seller 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. “Interconnection Facilities” means the interconnection facilities, control and protective devices and metering facilities required to connect the Facility with the Transmission System (or PTO’s distribution system, as applicable) in accordance with the Interconnection Agreement. “Interest Rate” has the meaning set forth in Section 8.2. “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 February 29, 2016 under which Buyer is organized as a Joint Powers Authority in accordance with the Joint Powers Act.
“kW” means kilowatts in alternating current, unless expressly stated in terms of direct current.
15 “Local Capacity Area Resource Adequacy Benefits” means the attributes, however defined, of a Local Capacity Area Resource that can be used to satisfy the local resource adequacy obligations of a load serving entity.
“Locational Marginal Price” or “LMP” has the meaning set forth in the CAISO Tariff. “Losses” means, with respect to any Party, an amount equal to the present value of the economic loss to it, if any (exclusive of Costs), resulting from termination of this Agreement for the remaining Contract Term, determined in a commercially reasonable manner. Factors used in determining economic loss to a Party may include, without limitation, reference to information supplied by one or more third parties, which shall exclude Affiliates of the Non-Defaulting Party, including without limitation, quotations (either firm or indicative) of relevant rates, prices, yields, yield curves, volatilities, spreads or other relevant market data in the relevant markets, comparable transactions, forward price curves based on economic analysis of the relevant markets, settlement prices for comparable transactions at liquid trading hubs (e.g., NYMEX), all of which should be calculated for the remaining Contract Term and must include the value of Green Attributes, Capacity Attributes, and Renewable Energy Incentives.
“Lost Output” has the meaning set forth in Exhibit D.
“Main Power Transformer” means the Facility’s main step-up transformer as depicted on the one-line diagram set forth in Exhibit A.
“Milestones” means the development activities for significant permitting, interconnection, financing and construction milestones set forth in the Cover Sheet. “Monthly Storage Availability” has the meaning set forth in Exhibit M. “Moody’s” means Moody’s Investors Service, Inc., or its successor. “MTR Attributes” has the meaning set forth in Section 3.15(a). “MTR Requirements” has the meaning set forth in Section 3.15. “MW” means megawatts measured 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, whether in the Day-Ahead Market or Real-Time Market, the LMP is less than zero dollars ($0). “Negative LMP Costs” has the meaning set forth in Section 3.3(c). “Net Qualifying Capacity” has the meaning set forth in the CAISO Tariff. “Network Upgrades” has the meaning set forth in the CAISO Tariff. 16 “Non-Availability Charge” has the meaning set forth in the CAISO Tariff. “Non-Defaulting Party” has the meaning set forth in Section 11.2. “Notice” shall, unless otherwise specified in this Agreement, mean written communications by a Party to be delivered by hand delivery, United States mail, overnight courier service, facsimile or electronic messaging (e-mail).
“Operating Restrictions” means the requirements and limitations set forth on Exhibit O-1. “Other Facility(ies)” means the electric generating or energy storage facility(ies), other than the Facility, utilizing any facilities shared with the Facility to enable delivery of energy from each such other generating or storage facility to the Delivery Point, together with all materials, equipment systems, structures, features and improvements necessary to produce or store electric energy at each such other generating or storage facility, but (i) with respect to the Shared Facilities, excluding Seller’s interests therein and (ii) excluding the real property on which each such other generating or storage facility is, or will be located, land rights and interests in land. “Partial Capacity Deliverability Status” or “PCDS” has the meaning set forth in the CAISO Tariff.
“Participating Transmission Owner” or “PTO” means an entity that owns, operates and maintains transmission or distribution lines and associated facilities and/or has entitlements to use certain transmission or distribution lines and associated facilities where the Facility is interconnected. For purposes of this Agreement, the Participating Transmission Owner is Pacific Gas & Electric Company.
“Party” has the meaning set forth in the Preamble.
“Performance Measurement Period” has the meaning set forth in Section 4.8. “Performance Security” means (i) cash, or (ii) a Letter of Credit, in the amount specified for the Performance Security on the Cover Sheet, deposited with Buyer in conformance with Section 8.8.
“Performance Security End Date” has the meaning set forth in Section 8.8. “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.
“PMAX” means the applicable CAISO-certified maximum operating level of the Storage Facility.
“PMIN” means the applicable CAISO-certified minimum operating level of the Storage Facility.
17 “PNode” has the meaning set forth in the CAISO Tariff. “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.
“Primary Availability” has the meaning set forth in Exhibit M. “Product” has the meaning set forth on the Cover Sheet. “Progress Report” means a progress report including the items set forth in Exhibit E. “Project” has the same meaning as Generating Facility.
“Prudent Operating Practice” means the practices, methods and standards of professional care, skill and diligence engaged in or approved by a significant portion of the electric power industry in the Western United States for facilities of similar size, type, and design, that, in the exercise of reasonable judgment, in light of the facts known at the time, would have been expected to accomplish results consistent with Law, reliability, safety, environmental protection, applicable codes, and standards of economy and expedition. Prudent Operating Practices are not necessarily defined as the optimal standard practice method or act to the exclusion of others, but rather refer to a range of actions reasonable under the circumstances. “PV Energy” means all Energy produced by the Generating Facility, as measured by the Generating Facility Meter after adjustment to exclude (a) all Electrical Losses, and (b) all Energy that serves Station Use.
“Qualified Reporting Entity” has the meaning set forth in the WREGIS Operating Rules. “Qualifying Capacity” has the meaning set forth in the CAISO Tariff. “RA Deficiency Amount” means the liquidated damages payment that Seller shall pay to Buyer for an applicable RA Shortfall Month as calculated in accordance with Section 3.9(b). “RA Guarantee Date” means the Commercial Operation Date. “RA Plan” has the meaning set forth for “Resource Adequacy Plan” in the CAISO Tariff with respect to Buyer’s monthly or annual Resource Adequacy showings to the CAISO and CPUC. “RA Shortfall” means, for a given Showing Month, the difference, expressed in kW, of (a) the Storage Facility’s Qualifying Capacity minus (b) the sum of (i) the portion of the Net Qualifying Capacity of the Storage Facility for such month able to be shown on Buyer’s monthly 18 or annual RA Plan to the CAISO and CPUC and counted as Resource Adequacy Benefits, plus (ii) Replacement RA provided by Seller with respect to an expected shortfall in Resource Adequacy Benefits of the Storage Facility for such Showing Month, if applicable (as determined fifteen (15) Business Days prior to the Showing Deadline for such Showing Month), The RA Shortfall shall be determined on the later of (x) the date that is fifteen (15) Business Days prior to the Showing Deadline, and (y) if applicable, the date (after the date that is fifteen (15) Business Days prior to the Showing Deadline) on which Buyer purchases replacement Resource Adequacy Benefits.
“RA Shortfall Month” means, for purposes of calculating an RA Deficiency Amount under Section 3.9(b), any month shown on an RA Plan, commencing with the RA Plan for the Showing Month that includes the RA Guarantee Date (including any month during the period between the RA Guarantee Date and the first day of the first Showing Month for Buyer which actually includes the Storage Facility’s Resource Adequacy Benefits or any Replacement RA, if applicable), for which there is an RA Shortfall.
“RA Substitute Capacity” has the meaning set forth in the CAISO Tariff. “Real-Time Market” has the meaning set forth in the CAISO Tariff. “Reimbursable Station Use” has the meaning set forth in Section 6.4(i). “
“Remedial Action Plan” has the meaning set forth in Section 2.4. “Renewable Energy Credit” or “REC” has the meaning set forth in California Public Utilities Code Section 399.12(h), as may be amended from time to time or as further defined or supplemented by Law.
“Renewable Energy Incentives” means: (a) all federal, state, or local Tax credits or other Tax benefits associated with the construction, ownership, or production of electricity from the Facility (including credits under Sections 38, 45, 46 and 48 of the Internal Revenue Code of 1986, as amended); (b) any federal, state, or local grants, subsidies or other like benefits relating in any way to the Facility, including a cash grant available under Section 1603 of Division B of the American Recovery and Reinvestment Act of 2009, provided 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 are not a Green Attribute or a Future Environmental Attribute.
“Renewable Rate” means the price per MWh of PV Energy that qualifies as PCC1, as set forth on the Cover Sheet, and as may be adjusted by Section 3.3. “Replacement RA” means Resource Adequacy Benefits (including satisfying the same Slice-of-Day operations profile and related characteristics) equivalent to those that would have been provided by the Facility with respect to the applicable month for which the Replacement RA 19 is being provided. Replacement RA shall (a) include, if applicable, Flexible Resource Adequacy Benefits that are of the same system designation, and Flexible Capacity Category as the Facility; (b) to the extent that the Facility would have qualified as a Local Capacity Area Resource for such month, be located in the same Local Capacity Area as the Facility; and (c) is capable of providing Resource Adequacy Benefits in the same hourly periods as the Facility or is otherwise acceptable to Buyer in its sole discretion. Replacement RA shall not be provided from any generating facility or unit that utilizes coal or coal materials as a source of fuel. “Resource Adequacy Benefits” means the rights and privileges attached to the Facility that satisfy any entity’s resource adequacy obligations, as those obligations are set forth in any Resource Adequacy Ruling, and shall include System Resource Adequacy Benefits, Flexible Resource Adequacy Benefits, and Local Capacity Area Resource Adequacy Benefits associated with the Facility.
“Resource Adequacy Rulings” means CPUC Decisions 04-01-050, 04-10-035, 05-10-042, 06-04-040, 06-06-064, 06-07-031, 07-06-029, 08-06-031, 09-06-028, 10-06-036, 11-06-022, 12-06-025, 13-06-024, 14-06-050, 15-06-063, 16-06-045, 17-06-027, 18-06-030, 18- 06-031, 19-02-022, 19-06-026, 19-10-021, 20-01-004, 20-03-016, 20-06-002, 20-06-028, 20-06- 031, 20-12-006, 21-06-029, 21-07-014, 22-03-034, 22-06-050, 22-12-028, 22-08-039, 23-04-010 and any other existing or subsequent ruling or decision, or any other resource adequacy laws, rules or regulations enacted, adopted or promulgated by any applicable Governmental Authority, however described, as such decisions, rulings, Laws, rules or regulations may be amended or modified from time-to-time throughout the Contract Term. “Resource ID” has the meaning set forth in the CAISO Tariff. “
“Round-Trip Efficiency” has the meaning set forth in Exhibit Q. “Round-Trip Efficiency Factor” has the meaning set forth in Exhibit Q. “RTD Instructed Imbalance Energy” has the meaning set forth in the CAISO Tariff. “RTE Shortfall Payment” has the meaning set forth in Exhibit Q. “S&P” means the Standard & Poor’s Financial Services, LLC (a subsidiary of The McGraw-Hill Companies, Inc.) or its successor.
“SCADA” means the standard supervisory control and data acquisition systems to be installed by Seller as part of the Facility, including those system components that enable Seller to receive ADS and AGC instructions from the CAISO or similar instructions from Buyer’s SC. “Schedule” has the meaning set forth in the CAISO Tariff. “Scheduled Energy” means the Energy reflected in a final Day-Ahead Schedule, FMM Schedule, and/or any other financially binding Schedule, market instruction or dispatch for the Facility for a given period of time.
20 “Scheduled Maintenance” has the meaning set forth in Section 6.1(a). “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 4.9(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).
“Settlement Interval” has the meaning set forth in the CAISO Tariff. “Settlement Period” has the meaning set forth in the CAISO Tariff, which as of the Effective Date is the period beginning at the start of the hour and ending at the end of the hour. “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 to the Delivery Point, including the Interconnection Facilities and the Interconnection Agreement itself, if applicable, that are used in common with third parties or by Seller for electric generation or storage facilities owned by Seller other than the Facility. “Showing Deadline” means the initial deadline that a Scheduling Coordinator must meet to submit its RA Plan, as established by CAISO or any other Governmental Authority. For illustrative purposes only, as of the Effective Date, the CAISO monthly Showing Deadline is approximately forty-five (45) days prior to the RA delivery month. “Showing Month” means the calendar month of the Delivery Term that is the subject of the RA Plan, as set forth in the Resource Adequacy Rulings and outlined in the CAISO Tariff. For illustrative purposes only, as of the Effective Date, the monthly RA Plan made in June is for the Showing Month of August.
21 “Site” means the real property on which the Facility is or will be located, as further described in Exhibit A, and as shall be updated by Seller at the time Seller provides an executed Construction Start Date Certificate to Buyer, in substantially the form of the Form of Construction Start Date Certificate in Exhibit H.
“Site Control” means that Seller: (a) owns or has the option to purchase the Site; (b) is the lessee or has the option to lease the Site; or (c) is the holder of an easement or an option for an easement, right-of-way grant, or similar instrument with respect to the Site. “SOC” or “State of Charge” means (a) the Stored Energy Level relative to (b) the Storage Capacity multiplied by four (4) hours, expressed as a percentage. The “SOC” shall represent the range of Stored Energy Level reserved exclusively for Buyer’s use; provided, Seller may represent such range anywhere within the actual available capability of the Storage Facility. “SOD” or “Slice-of-Day” has the meaning set forth in the Resource Adequacy Rulings. “Station Use” has the meaning given in the tariff of the retail provider of energy for the Facility and reflects:
(a) the electric energy that is used within the Facility (including to power the lights, motors, control systems, thermal regulation equipment and other electrical loads) and that is necessary for operation of the Facility; and
(b) the electric energy that is consumed within the Facility’s electric energy distribution system as losses (other than any losses that are Electrical Losses). “Storage Availability Adjustment” has the meaning set forth in Exhibit M. “Storage Capacity” means the maximum dependable operating capability of the Storage Facility (expressed in MW AC) to discharge electric energy at the maximum discharge rate that can be sustained for four (4) consecutive hours, as the same is to be established as of the Commercial Operation Date and adjusted from time to time pursuant to Exhibit N to reflect the results of the most recently performed Storage Capacity Test (including the Commercial Operation Storage Capacity Test); provided, the Storage Capacity shall not at any time exceed the lesser of (a) the Guaranteed Storage Capacity (with respect to a Commercial Operation Storage Capacity Test), and (b) the Storage Facility’s then current PMAX in the Storage Facility’s CAISO’s Master Data File and Resource Data Template (or successor data systems) (with respect to any other Storage Capacity Test).
“Storage Capacity Payment” has the meaning set forth in Section 3.3(e). “Storage Capacity Test” or “SCT” means any test or retest of the capacity of the Storage Facility conducted in accordance with the testing procedures, requirements and protocols set forth in Exhibit N.
22 “Storage Facility” means the energy storage facility described on the Cover Sheet and in Exhibit A (including the operational requirements of the energy storage facility), located at the Site and including mechanical equipment and associated facilities and equipment and Seller’s rights and interests in Shared Facilities required to deliver the Storage Product, but excluding any portions of Shared Facilities other than Seller’s rights and interests thereto. “Storage Facility Meter” means the CAISO Approved Meter (with a 0.3 accuracy class), sufficient for monitoring, recording and reporting, in real time, the amount of (i) Charging Energy, (ii) Discharging Energy and (iii) Energy that serves Station Use. For clarity, the Facility may include multiple measurement devices and calculations that will make up the Storage Facility Meter, and, unless otherwise indicated, references to the Storage Facility Meter shall mean all such measurement devices and calculations and the aggregated data of all such measurement devices and calculations, taken together.
“Storage Product” means (a) the ability of the Storage Facility to accept and store Charging Energy and to deliver Discharging Energy in accordance with the terms of this Agreement, (b) Capacity Attributes, if any, (c) Storage Capacity, and (d) Ancillary Services (as defined in the CAISO Tariff), if any, in each case arising from or relating to the Storage Facility. “Storage Rate” has the meaning set forth on the Cover Sheet. “Stored Energy” means the electric energy in the Storage Facility available to be discharged as Discharging Energy.
“Stored Energy Level” means, at a particular time, the amount of electric energy in the Storage Facility available to be discharged as Discharging Energy, expressed in MWh. “Subsequent Purchasers” means the purchaser or recipient of Product from Buyer in any conveyance, re-sale or remarketing of Product by Buyer. “Supplementary Capacity Test Protocol” has the meaning set forth in Exhibit N. “Supply Chain Code” has the meaning set forth in Exhibit S. “Supply Plan” has the meaning set forth in the CAISO Tariff. “System Emergency” means any condition that: (a) requires, as determined and declared by CAISO or the PTO, automatic or immediate action to (i) prevent or limit harm to or loss of life or property, (ii) prevent loss of transmission facilities or generation supply in the immediate vicinity of the Facility, or (iii) preserve Transmission System reliability, and (b) directly affects the ability of any Party to perform under any term or condition in this Agreement, in whole or in part.
“System Resource Adequacy Benefits” means the attributes, however defined, of a resource that can be used to satisfy the resource adequacy obligations of a load serving entity, other than Flexible Resource Adequacy Benefits and Local Capacity Area Resource Adequacy Benefits. 23 “Tangible Net Worth” means the tangible assets (for example, not including intangibles such as goodwill and rights to patents or royalties) that remain after deducting liabilities as determined in accordance with generally accepted accounting principles. “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. “Terminated Transaction” has the meaning set forth in Section 11.2. “Termination Payment” has the meaning set forth in Section 11.3. “Test Energy” means the Energy delivered (a) commencing on the later of (i) the first date that the CAISO informs Seller in writing that Seller may deliver Energy from the Facility to the CAISO and (ii) the first date that the PTO informs Seller in writing that Seller has conditional or temporary permission to parallel and (b) ending upon the occurrence of the Commercial Operation Date.
“Test Energy Acceptance Deadline” has the meaning set forth in Section 3.7(a). “Test Energy Acceptance Notice” has the meaning set forth in Section 3.7(a). “Test Energy ROFR Notice” has the meaning set forth in Section 3.7(a). “Transformer Failure” means a failure of all or part of the Main Power Transformer that results in the Facility being unable to deliver Facility Energy or receive Charging Energy during such failure, and such failure was not caused by Seller and could not have been avoided through the exercise of Prudent Operating Practices.
“Transmission Provider” means the CAISO, as applicable. “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.
“Ultimate Parent”
“Variable Energy Resource” or “VER” has the meaning set forth in the CAISO Tariff. 24 “Variable Energy Resource Forecast” or “VER Forecast” means, for a given period, the final forecast of the Energy to be produced by the Facility prepared by the CAISO in accordance with the Eligible Intermittent Resources Protocol.
“WECC” means the Western Electricity Coordinating Council or its successor. “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 4.9(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 January 4, 2021, 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 Section, paragraph, clause of, or that Party or Exhibit to, this Agreement unless otherwise specified;
(e) a reference to a document or agreement, including this Agreement shall mean such document, agreement or this Agreement including any amendment or supplement to, or replacement, novation or modification of this Agreement, but disregarding any amendment, supplement, replacement, novation or modification made in breach of such document, agreement or this Agreement;
(f) a reference to a Person includes that Person’s successors and permitted assigns;
(g) the term “including” (and its variants) means “including 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; 25 (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, and references to a LMP shall mean the LMP at the Delivery Point unless expressly provided otherwise;
(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”). (b) Reserved.
(c) 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 19 shall remain in full force and effect for three (3) years following the termination of this Agreement, and all indemnity and audit rights shall remain in full force and effect for two (2) years following the termination of this Agreement.
2.2 Conditions Precedent. The Delivery Term shall not commence until Seller completes 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, 26 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 installed and commissioned generating equipment with a nameplate capacity of no less than ninety-five percent (95%) of the Guaranteed PV Capacity; (b) Seller shall have installed and commissioned storage equipment with a capacity of no less than ninety-five percent (95%) of the Guaranteed Storage Capacity; (c) Seller shall have delivered to Buyer certificates from a Licensed Professional Engineer substantially in the form of Exhibits G-1 and G-2; (d) A Participating Generator Agreement between Seller and CAISO shall have been executed and delivered,
(e) An Interconnection Agreement between Seller and the PTO shall have been executed and delivered and be in full force and effect and a copy of the Interconnection Agreement, including all modifications and amendments thereto, delivered to Buyer; (f) Authorization to parallel the Facility was obtained by the Participating Transmission Owner prior to the Commercial Operation Date; (g) The Transmission Provider has provided documentation supporting full unrestricted release for Commercial Operation by the Commercial Operation Date. (h) The Facility has achieved CAISO Commercial Operation. (i) The Facility is providing Resource Adequacy Benefits to Buyer for the month in which Delivery Term commences;
(j) Buyer, or its designee, is the Scheduling Coordinator for the Facility; provided, if this requirement is not met because of Buyer’s (or its designee’s) actions or failure to take actions, and this is the only requirement for Commercial Operation that has not been met, Seller shall be entitled to a day for day extension of the Guaranteed Commercial Operation Date for such Buyer (or its designee) actions or failure to act. (k) Seller shall have delivered to Buyer a copy of all environmental impact reports (i.e. EIRs), studies (i.e. EISs) or assessments (i.e. EIAs) prepared by or obtained by Seller or its Affiliates, the conditional use permit or other principal land use approval for the Facility, and a certificate signed by an authorized representative of Seller stating that Seller is in compliance with the requirements of the conditional use permit or other principal land use approval; (l) Seller has received CEC Precertification;
(m) Seller (with the reasonable participation of Buyer) shall have completed all applicable WREGIS registration requirements
27 including the completion and
submittal of all applicable registration forms and supporting documentation, which may include applicable interconnection agreements, informational surveys related to the Generating Facility, Qualified Reporting Entity service agreements, and other appropriate documentation required to effect Generating Facility registration with WREGIS and to enable Renewable Energy Credit transfers related to the Generating Facility within the WREGIS system; (n) Seller shall have caused the Generating Facility and the Storage Facility to be included in the Full Network Model and has ability to offer Bids into CAISO Day-Ahead Markets and Real-Time Markets in respect of each of the Generating Facility and the Storage Facility;
(o) Seller shall have completed all necessary steps to provide Ancillary Services from the Storage Facility, including completing the certification and testing requirements in Section 8 and Appendix K of the CAISO Tariff;
(p) Seller has delivered to Buyer a copy of the most recent generation resource report (including as prepared by an independent engineer in connection with the financing of the construction or permanent operation of the Facility, and the most up-to-date 8760
hourly generation forecast;
(q) Seller has delivered the Performance Security to Buyer; (r) Seller has paid Buyer for all Daily Delay Damages and Commercial Operation Delay Damages owing under this Agreement, if any; (s) Seller has demonstrated compliance with Section 7.1, including installation of the Storage Facility Meter
(t) Seller has delivered to Buyer a plan that is reasonably acceptable to Buyer for the proper recycling and disposal of all project components, equipment, and materials at the end of the useful life of the Facility.
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 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. (b) Seller shall ensure that all materials, products and components used in constructing, installing and operating the Facility throughout the Contract Term shall be in compliance with the Supply Chain Code. Seller shall
comprehensively implement due diligence procedures for its and its Affiliate’s suppliers, 28 subcontractors and other participants in its supply chains, to comply with the Supply Chain Code.
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).
(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
day after the missed
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), and 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. If the missed Milestone(s) is not the Guaranteed Construction Start Date or the Guaranteed Commercial Operation Date, and so long as Seller complies with its obligations under this Section 2.4, then Seller shall not be considered in default of its obligations under this Agreement as a result of missing such Milestone(s).
2.5 Facility Configuration. The Parties agree that the Facility configuration will be as Co-located Resources with separate CAISO Resource IDs and separate CAISO approved revenue quality meters for each of the Storage Facility and Generating Facility. Seller shall design and configure the Facility metering and equipment (although not necessarily the software associated therewith) to accommodate being able to function in a Co-located Resource configuration ARTICLE 3
PURCHASE AND SALE
3.1 Sale of Product.
(a) Subject to the terms and conditions of this Agreement, during the period (i) if Buyer elects to purchase Test Energy pursuant to Section 3.7(a), commencing upon Initial Synchronization with respect to the Generating Facility and (ii) commencing upon Commercial Operation with respect to the Storage Facility and with respect to the Generating Facility if Buyer does not elect to purchase Test Energy pursuant to Section 3.7(a), and continuing throughout the Delivery Term, Seller shall sell and deliver to Buyer, and Buyer shall purchase and receive from Seller all of the Product produced by the Facility. Buyer shall re-sell all of the Energy purchased hereunder, and may, at its sole discretion, re-sell or use for another purpose all or a portion of the remainder of the Product, provided, such resale or use for another purpose will not relieve Buyer of any of its obligations under this Agreement.
(b) Except for Deemed Delivered Energy, Buyer has no obligation to pay Seller for any Product that is not delivered to the Delivery Point as a result of any circumstance, 29 including, an outage of the Facility, a Force Majeure Event, or a Curtailment Order. In no event shall Seller have the right to procure any element of the Product from sources other than the Facility for sale or delivery to Buyer under this Agreement, except with respect to Replacement RA.
3.2 Sale of Green Attributes. Seller shall sell and deliver to Buyer, and Buyer shall purchase and receive from Seller, all of the Green Attributes produced by the Facility during the Delivery Term, and any Green Attributes associated with Test Energy
3.3 Compensation. Buyer shall compensate Seller for the Product in accordance with this Section 3.3.
(a) Buyer shall pay Seller the Renewable Rate for each MWh of PV Energy that qualifies as PCC1 and is delivered to the Delivery Point, plus Deemed Delivered Energy, if any, up to one hundred ten percent (110%) of the Expected Energy for such Contract Year. (b) If, at any point in any Contract Year following CAISO Commercial Operation, the amount of PV Energy delivered to the Delivery Point plus the amount of Deemed Delivered Energy exceeds one hundred ten percent (110%) of the Expected Energy for such Contract Year, for each additional MWh of PV Energy that qualifies as PCC1 or Deemed Delivered Energy, if any, delivered to the Delivery Point in such Contract Year, the price to be paid shall be .
(c) If during any Settlement Interval, Seller delivers PV Energy in excess of the product of the Installed PV Capacity 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 the number of such Excess MWh (“Negative LMP Costs”).
(d) The price for PV Energy that does not qualify as PCC1 shall be the lesser of (i) the Renewable Rate, or (ii) the Day-Ahead LMP for the applicable Settlement Interval. (e) For the Storage Product, for each month commencing on Commercial Operation and throughout the Delivery Term, Buyer shall pay Seller an amount equal to [(A x B x C) – D], (such amount, the “Storage Capacity Payment”), where:
A = the Storage Rate
B = the current Storage Capacity (in kW)
C = the applicable Storage Availability Adjustment determined in accordance with Exhibit M
D = the applicable RTE Shortfall Payment determined in accordance with Exhibit Q (if applicable)
30 The Storage Capacity Payment constitutes the entirety of the amount due to Seller from Buyer for the Storage Product.
3.4 Imbalance Energy. With respect to the Generating Facility, as a Variable Energy Resource, Buyer and Seller recognize that from time to time the amount of PV Energy will deviate from the amount of Scheduled Energy. Buyer and Seller shall reasonably cooperate to minimize charges and imbalances associated with Imbalance Energy caused by the variances in solar insolation to the extent possible. To the extent there are such deviations, any CAISO costs or revenues assessed as a result of such Imbalance Energy shall be solely for the account of Buyer; provided, (a) with respect to the Generating Facility, to the extent such deviations are the result of any cause other than (i) variances in solar insolation
with respect to any deviations by the Storage Facility from its Schedule (to the extent such Schedule is consistent with the Operating Restrictions), any CAISO costs assessed as a result of such Imbalance Energy shall be solely for the account of Seller, and all CAISO revenue associated with such deviations shall be solely for the account of Buyer. CAISO costs and revenues in connection with RTD Instructed Imbalance Energy shall be for Buyer’s account except to the extent such RTD Instructed Imbalance Energy was the result of a change in the Forecasted Product after the deadline for submitting Schedules in the Day-Ahead Market, in which case the CAISO costs shall be for Seller’s account, and all CAISO revenue associated with such deviations shall be solely for the account of Buyer.
3.5 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.
3.6 Future Environmental Attributes.
(a) The Parties acknowledge and agree that as of the Effective Date, Future Environmental Attributes may be created by a Governmental Authority through Laws enacted after the Effective Date. Buyer shall have the right to obtain such Future Environmental Attributes without any adjustment to the Contract Price paid by Buyer under this Subject to Section 3.6(b) and 3.13, Seller
shall take all reasonable actions necessary to realize the full value of such Future Environmental Attributes for the benefit of Buyer, and shall cooperate with Buyer in Buyer’s efforts to do the same.
(b) If Buyer elects to receive Future Environmental Attributes pursuant to Section 3.6(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
32 (c) Subject to Section 3.13, Seller shall take all commercially reasonable actions, including complying with all applicable registration and reporting requirements, and execute any and all documents or instruments necessary to enable Buyer to use all of the Capacity Attributes committed by Seller to Buyer pursuant to this Agreement. (d) For the duration of the Delivery Term, Seller shall maintain an interconnection capacity under its Interconnection Agreement of at least the amount of the Guaranteed Interconnection Capacity.
(e) Seller shall provide Notice to Buyer not less than fifteen (15) Business Days prior to each Showing Deadline confirming the Net Qualifying Capacity of the Facility and/or any Replacement RA that is able to be shown on Buyer’s monthly or annual RA Plan, as applicable.
Seller shall be solely responsible to provide RA Substitute Capacity in accordance with applicable CAISO requirements in connection with Seller’s Facility outages; provided, Buyer or Buyer’s SC, if applicable, will cooperate to allow Seller to deliver such RA Substitute Capacity to the CAISO.
Seller acknowledges and agrees that any failure by Seller to provide such RA Substitute Capacity may result in CAISO rejecting or cancelling Scheduled Maintenance or other outage of the Storage Facility. Buyer shall notify Seller within after becoming aware of an obligation by Seller to provide RA Substitute Capacity. Upon request by Seller, Buyer shall use commercially reasonable efforts to secure, on Seller’s behalf, RA Substitute Capacity; provided, Seller shall reimburse Buyer for all out-of-pocket costs, including broker and outside counsel costs, associated with such RA Substitute Capacity. If Seller declines to provide RA Substitute Capacity, and notifies Buyer to that effect no less than five (5) Business Days before the applicable Showing Deadline, then Buyer shall not include the Storage Facility (or, if applicable, the portion of the Storage Facility) in its Supply Plan for the Facility and Seller’s sole liability will be payment of the RA Deficiency Amount for such RA Shortfall pursuant to Section 3.9. (f) If Seller anticipates it will have an RA Shortfall in any month of the Delivery Term, Seller may provide Replacement RA up to the anticipated RA Shortfall, provided (i) Seller provides Buyer with Replacement RA product information in a Notice substantially in the form of Exhibit K at least seventy-five (75) days before the applicable Showing Month, and (ii) Replacement RA shall not exceed twenty-five percent (25%) of the Resource Adequacy Benefits provided during any Contract Year;
3.9 Resource Adequacy Failure.
(a) RA Deficiency Determination. Notwithstanding Seller’s obligations set forth in Section 4.3 or anything to the contrary herein, the Parties acknowledge and agree that if 33 during the Delivery Term Seller fails to provide Resource Adequacy Benefits in an amount equal to or greater than the Facility’s Qualifying Capacity as required hereunder, then Seller shall pay to Buyer the RA Deficiency Amount for each RA Shortfall Month as liquidated damages due to Buyer for the Capacity Attributes that Seller failed to convey to Buyer. (b) RA Deficiency Amount Calculation. For each RA Shortfall Month, except as otherwise provided in Section 3.9(a), Seller shall pay to Buyer an amount (the “RA Deficiency Amount”) equal to the sum of:
(i) For any portion of the RA Shortfall for which Buyer incurs a CPUC System RA Penalty (“CPUC-Penalized Shortfall”), the amount of such CPUC System RA Penalty for such month and actually incurred by Buyer (which shall be zero (0) if Buyer does not incur any CPUC System RA Penalty), plus
(ii) For any portion of the RA Shortfall for which Buyer incurs CAISO costs, charges or penalties associated with such shortfall (“CAISO-Penalized Shortfall”), the amount of such CAISO costs, charges or penalties directly resulting from such RA Shortfall for such month and actually incurred by Buyer (which shall be zero (0) if Buyer does not incur any CAISO costs, charges or penalties associated with the RA Shortfall), plus (iii) For any RA Shortfall which is not CPUC-Penalized Shortfall and/or CAISO-Penalized Shortfall, and for which Buyer purchased replacement Resource Adequacy Benefits, the amount of Buyer’s cost of such replacement Resource Adequacy Benefits, plus (iv) For any RA Shortfall which is not CPUC-Penalized Shortfall and/or CAISO-Penalized Shortfall, and for which Buyer did not purchase replacement Resource Adequacy Benefits, t
(c)
3.10 CEC Certification and Verification. Subject to Section 3.13, Seller shall take all necessary steps including, but not limited to, making or supporting timely filings with the CEC to obtain and maintain CEC Precertification and CEC Final Certification and Verification for the Facility. 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 CEC Final 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 CEC Final Certification and Verification. Seller must promptly notify Buyer and the CEC of any changes to the information included in Seller’s application for CEC Precertification or CEC Final Certification and Verification for the Facility.
(b) one hundred eighty (180) days of
the Delivery Term, provided, Seller has obtained and maintained CEC Precertification, Buyer shall pay Seller the Renewable Rate for PV Energy that qualifies as PCC1 and the lower of (i) the Renewable Rate or (ii) the Day-Ahead LMP for PV Energy that does not qualify as PCC1, 34 according to Section 3.3, regardless of whether Seller has obtained CEC Final Certification and Verification. If Seller has not obtained CEC Final Certification and Verification within one hundred eighty (180) days after the Commercial Operation Date, Buyer will compensate Seller for the PV Energy, regardless of PCC1 eligibility, at the lower of (i) the Renewable Rate, as adjusted according to Section 3.3, or (ii) the Day-Ahead LMP, for the remainder of the Delivery Term, or until Seller obtains CEC Final Certification and Verification. If Seller obtains CEC Final Certification and Verification after one hundred eighty (180) days after the Commercial Operation Date, Buyer will thereafter begin paying Seller the Renewable Rate for PV Energy that qualifies as PCC1 according to Section 3.3, and, if such CEC Final Certification and Verification relates back to all Energy delivered by Seller during the Delivery Term, will reimburse Seller for the difference between (x) any reduced amounts paid to Seller for PV Energy under this Section 3.10 due to Seller’s failure to obtain CEC Final Certification and Verification within one hundred eighty (180) days after the Commercial Operation Date, and (y) the amount that would have been paid to Seller had Seller timely obtained CEC Final Certification and Verification within one hundred eighty (180) days after the Commercial Operation Date. If Seller has not obtained CEC Final Certification and Verification within one (1) year of the Commercial Operation Date, then an Event of Default shall occur, Buyer shall have all remedies available under this Agreement, including under Section 11.2, and, in the event that Buyer terminates this Agreement under Section 11.2, Seller shall reimburse Buyer, in addition to any other amounts owed, in an amount equal to the difference between (a) the amount paid by Buyer to Seller for PV Energy during the first one hundred eighty (180) days of the Delivery Term, and (b) the amount that would have been paid if the price for energy delivered during the first one hundred eighty (180) days of the Delivery Term were the Day-Ahead LMP.
3.11 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]
3.12 California Renewables Portfolio Standard. Subject to Section 3.13, Seller shall also take all other actions necessary to ensure that the Energy produced from the Generating Facility is tracked for purposes of satisfying the California Renewables Portfolio Standard requirements, as may be amended or supplemented by California statute or by the CPUC or CEC from time to time.
3.13 Compliance Expenditure Cap. If Seller establishes to Buyer’s reasonable satisfaction that a change in Law occurs after the Effective Date that has resulted in, or given rise to, an increase in Seller’s known or reasonably expected costs and expenses to comply with Seller’s obligations under the Agreement with respect to obtaining, maintaining, conveying or effectuating Buyer’s use of (as applicable), the items listed in Sections 3.13(a), (b), (c), and (d) (not including any RA Deficiency Amounts), then the Parties agree that the maximum aggregate amount of costs and expenses Seller shall be required to bear during the Delivery Term shall be capped at Twenty 35 Five Thousand Dollars ($25,000.00) per MW of Guaranteed Storage Capacity cumulatively during the Delivery Term (“Compliance Expenditure Cap”):
(a) CEC Certification and Verification;
(b) Green Attributes; and
(c) Capacity Attributes.
Any actions required for Seller to comply with its obligations set forth in the first paragraph above, the cost of which will be credited to the Compliance Expenditure Cap, shall be referred to collectively as the “Compliance Actions”.
If Seller reasonably anticipates the need to incur out-of-pocket expenses in excess of the Compliance Expenditure Cap in order to take any Compliance Action, Seller shall provide Notice to Buyer of such anticipated out-of-pocket expenses.
Buyer will have sixty (60) days to evaluate such Notice (during which time period Seller is not obligated to take any Compliance Actions described in the Notice) and shall, within such time, either (1) agree to reimburse Seller for all 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 3.13 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.
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 reasonable documentation of such costs from Seller.
The term “commercially reasonable efforts” as used in Sections 3.11 and 4.8(h) means efforts consistent with and subject to this Section 3.13.
36 3.14 Guaranteed Interconnection Capacity. Seller shall enable the Aggregate Capability Constraint and sub-Aggregate Capability Constraints with CAISO so as to ensure that the Buyer has the exclusive right to use the Guaranteed Interconnection Capacity.
3.15 CPUC Mid-Term Reliability Requirements. The Parties acknowledge that Buyer is entering into this Agreement to satisfy a portion of its obligations to procure capacity to meet mid-term reliability requirements specified by the CPUC in CPUC Decision (“D.”) 21-06-035, D.23-02-040, and related CPUC orders and decisions (“MTR Requirements”) as a generic resource (and not for any sub-category of D.21-06-035). Seller represents and warrants to Buyer that:
(a) During the Delivery Term, the Product includes the exclusive right to claim the Capacity Attributes of the Storage Facility as an incremental generic resource for purposes of CPUC Decision 21-06-035 and other MTR Requirements (“MTR Attributes”); (b) Seller has not and will not sell, assign or transfer the right to claim procurement of the Capacity Attributes of the Storage Facility as an incremental resource for purposes of CPUC Decision 21-06-035 and other MTR Requirements to any other person or entity during the Delivery Term; and
(c) Seller will provide to Buyer additional information and documentation reasonably available to Seller on a commercially reasonable basis if necessary to enable Buyer to demonstrate that the Product meets the procurement mandates set forth in the MTR Requirements
3.16 Buyer’s Re-Sale of Product. Buyer shall have the exclusive right in its sole discretion to convey, use, market, or sell the Product, or any part of the Product, to any Subsequent Purchaser; and Buyer shall have the right to all revenues generated from the conveyance, use, re-sale or remarketing of the Product, or any part of the Product. If the CAISO or CPUC develops a centralized capacity market, Buyer shall have the exclusive right to offer, bid, or otherwise submit the Capacity Attributes for re-sale into such market, and Buyer shall retain and receive all revenues from such re-sale. Seller shall take all commercially reasonable actions and execute all documents or instruments reasonably necessary to allow Subsequent Purchasers to use such resold Product, but without increasing Seller’s obligations or liabilities under this Agreement. If Buyer incurs any liability to a Subsequent Purchaser due to the failure of Seller to comply with this Section 3.16, Seller shall be liable to Buyer for the amounts Seller would have owed Buyer under this Agreement if Buyer had not resold the Product.
ARTICLE 4
OBLIGATIONS AND DELIVERIES
4.1 Delivery.
(a) Energy. Subject to the terms and conditions of this Agreement, Seller shall make available and Buyer shall accept at the Delivery Point all Product. Each Party shall perform all obligations under this Agreement, including all generation, scheduling, and transmission 37 services in compliance with (i) the CAISO Tariff, (ii) WECC scheduling practices, and (iii) Prudent Operating Practice.
(b) Green Attributes. Seller hereby provides and conveys all Green Attributes associated with the Facility during the Delivery Term as part of the Product being delivered. 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 during the Delivery Term. Upon request of Buyer, Seller shall submit a Green-e® Energy Tracking Attestation Form (“Attestation”) for Product delivered under this Agreement to the Center for Resource Solutions (“CRS”) at https://www.tfaforms.com/4652008 or its successor. The Attestation shall be submitted in accordance with the requirements of CRS and shall be submitted within thirty (30) days of Buyer’s request or the last day of the month in which the applicable Energy was generated, whichever is later.
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. Title to and risk of loss related to the Charging Energy, if any, shall pass and transfer from Buyer to Seller at the Storage Facility Meter. (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 Scheduling Coordinator Responsibilities.
(a) Scheduling Coordinator for the Facility. Prior to Commercial Operation, Seller 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 the Product at the Delivery Point. Upon Commercial Operation, 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 the Product at the Delivery Point. At least thirty (30) days prior to the anticipated date of Commercial Operation, (i) Seller shall take all actions and execute and deliver to Buyer and the CAISO all documents necessary to authorize or designate Buyer as the Facility’s Scheduling Coordinator effective as of Commercial Operation, 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 Commercial Operation. On and after Commercial Operation, Seller shall not authorize or designate any other party to act as the Facility’s Scheduling Coordinator, nor shall Seller perform for its own benefit the duties of Scheduling Coordinator, and Seller shall not revoke Buyer’s authorization to act as the Facility’s Scheduling Coordinator unless agreed to by Buyer. Buyer (as the Facility’s SC) shall submit Schedules to the CAISO in accordance with this Agreement and the applicable CAISO Tariff, protocols and Scheduling practices,
for Product or load, as applicable, on a day-ahead,
hour-ahead, fifteen-minute market or real time basis, as determined by Buyer. 38 (b) Notices. Following Commercial Operation, 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 Facility Outages, Forced Facility Outage reports, clearance requests, or must offer waiver forms. Seller will cooperate with Buyer to provide such notices and updates. If the web-based system is not available, Seller shall promptly submit such information to Buyer and the CAISO (in order of preference) telephonically, by electronic mail, or facsimile transmission to the personnel designated to receive such information. (c) CAISO Costs and Revenues. Following Commercial Operation and except as otherwise set forth below and in Sections 3.4 and 3.7, 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, except as otherwise provided in this Agreement), including revenues associated with CAISO dispatches, bid cost recovery, Inter-SC Trade credits, or other credits in respect of the Product Scheduled or delivered from the Facility.
Seller shall be responsible for all CAISO penalties or fees (including costs associated with Imbalance Energy, as set forth in Section 3.4, and CAISO No Pays) resulting from any failure by Seller to abide by the CAISO Tariff or 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 following Commercial Operation). The Parties agree that any Availability Incentive Payments are for the benefit of the Seller and for Seller’s account and that any Non-Availability Charges are the responsibility of the Seller and for Seller’s account (except to the extent any Non-Availability Charges are incurred due to Buyer’s failure to perform its duties as Scheduling Coordinator for the Facility). In addition, if after Commercial Operation, 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 the
(d) CAISO Settlements. Buyer (as the Facility’s SC) shall be responsible for all settlement functions with the CAISO related to the Facility after Commercial Operation. Buyer shall render a separate invoice to Seller for any CAISO charges or penalties (“CAISO Charges Invoice”) for which Seller is responsible under this Agreement, including Section 3.4, which shall be offset with any charges or penalties for which Buyer is responsible. CAISO Charges Invoices shall be rendered after settlement information becomes available from the CAISO that identifies any CAISO charges. Notwithstanding the foregoing, Seller acknowledges that the CAISO will issue additional invoices reflecting CAISO adjustments to such CAISO charges . Buyer will
review, validate, and if requested by Seller under Section 4.3(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 undisputed CAISO Charges Invoices within ten (10) Business Days of Seller’s receipt of the CAISO Charges Invoice. If Seller fails to pay such undisputed CAISO Charges Invoice 39 within that period, Buyer may net or offset any amounts owing to it for these CAISO Charges Invoices against any future amounts it may owe to Seller under this Agreement. The obligations under this section with respect to payment of CAISO Charges Invoices shall survive the expiration or termination of this Agreement.
(e) Dispute Costs. Buyer (as the Facility’s SC) may be required by Seller to dispute CAISO settlements in respect of the Facility following Commercial Operation. Seller agrees to pay Buyer’s costs and expenses (including reasonable attorneys’ fees) associated with its involvement with such CAISO disputes to the extent they relate to CAISO charges payable by Seller with respect to the Facility that Seller has directed Buyer to dispute. (f) Terminating Buyer’s Designation as Scheduling Coordinator. At least thirty (30) days prior to expiration of this Agreement or as soon as reasonably practicable upon an earlier termination of this Agreement, the Parties will take all actions necessary to terminate the designation of Buyer as Scheduling Coordinator for the Facility as of 11:59 p.m. on such expiration date.
(g) Master Data File and Resource Data Template. Seller shall provide the data to the CAISO (and to Buyer) that is required for the CAISO’s Master Data File and Resource Data Template (or successor data systems) for this Facility consistent with this Agreement. Neither Party shall change such data without the other Party’s prior written consent, not to be unreasonably withheld.
(h) NERC Reliability Standards. Following Commercial Operation, 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.
40 4.4 Forecasting. Seller shall provide the forecasts described below. Seller’s (i) Available Generating Capacity, (ii) Available Storage Capacity, and (iii) Available Storage Capability forecasts (items (i), (ii), and (iii) collectively referred to as the “Forecasted Product”) shall include availability and updated status of key equipment for the Facility. Seller shall use commercially reasonable efforts to forecast the Forecasted Product and expected PV Energy of the Facility accurately and to transmit such information in a format reasonably acceptable to Buyer (or Buyer’s designee).
(a) Annual Forecast of Monthly Expected PV Energy. No less than ninety (90) 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 a non-binding forecast of monthly expected PV Energy, by hour, for the following calendar year in the form attached hereto as Exhibit L-1 or as reasonably requested by Buyer.
(b) Monthly Forecast of Available Generating Capacity, Available Storage Capacity, and Available Storage Capability. No less than thirty (30) days before CAISO Commercial Operation, and thereafter ten (10) Business Days before the beginning of each month during the Delivery Term, Seller shall provide to Buyer and Buyer’s designee (if applicable) a non-binding forecast of the hourly Forecasted Product, and expected PV Energy, for each day of the following month in the forms attached hereto as Exhibits L-2, L-3 and L-4, respectively, or as reasonably requested by Buyer.
(c) Daily Forecast. By 5:30 AM Pacific Prevailing Time on the Business Day immediately preceding the date of delivery, Seller shall provide Buyer with a non-binding forecast of the Forecasted Product for each hour of the immediately succeeding day (“Day-Ahead Forecast”). A Day-Ahead Forecast provided in a day prior to any non-Business Day(s) shall include non-binding forecasts for the immediate day, each succeeding non-Business Day and the 41 next Business Day. Each Day-Ahead Forecast shall clearly identify, for each hour, Seller’s best estimate of the Available Generating Capacity (or if requested by Buyer, the monthly expected PV Energy), Available Storage Capacity, and Available Storage Capability. (d) Real-Time Forecast. During the period commencing upon CAISO Commercial Operation and continuing throughout the Delivery Term, Seller shall notify Buyer of any changes in Forecasted Product of one (1) MW or MWh or more, whether due to 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 Notices shall contain information regarding the beginning date and time of the event resulting in the change in Available Generating Capacity, Available Storage Capacity, and/or Available Storage Capability, as applicable, the expected end date and time of such event, the expected Available Generating Capacity, Available Storage Capacity, and/or Available Storage Capability, as applicable, in MW, 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. These Notices and changes to Available Generating Capacity, Available Storage Capacity, and/or Available Storage Capability shall be communicated in a method acceptable to Buyer; provided, 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 a acceptable method for communications under this Section 4.4(d), then Seller shall send such communications by telephone and e-mail to Buyer.
4.5 Dispatch Down/Curtailment.
(a) General. Seller agrees to reduce the Generating Facility’s generation 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. Buyer has no obligation to purchase or pay for any Product delivered in violation of any Curtailment Order, Buyer Curtailment Order, or notice received from CAISO in respect of a Buyer Bid Curtailment, or for any Product that could not be delivered to the Delivery Point due to a Force Majeure Event. (b) Buyer Curtailment. Buyer shall have the right to order Seller to curtail deliveries of PV Energy or Discharging Energy to the Delivery Point pursuant to a Buyer Curtailment Order or Buyer Bid Curtailment, provided, Buyer shall pay Seller for all Deemed Delivered Energy associated with all Buyer Curtailment Periods at the applicable 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 to the Delivery Point in contradiction to 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 42 of such MWh and, (B) is an amount equal to the absolute value of the Negative LMP, if any, for the Buyer Curtailment Period or Curtailment Period, times the amount of MWh of Facility Energy delivered to the Delivery Point in contradiction to the Buyer Curtailment Order, Buyer Bid Curtailment or Curtailment Order, and (C) is any penalties or other charges 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 period commencing upon CAISO Commercial Operation and continuing throughout the Delivery Term, Seller’s facilities, communications links or other equipment, protocols or practices are not in compliance with methodologies applicable to the Facility as required by CAISO, Seller shall take the steps necessary to become compliant as soon as commercially reasonably possible. Seller promptly repair and
replace as necessary such facilities, communication links or other equipment, and shall notify Buyer as soon as Seller discovers any defect. If Buyer notifies Seller of the need for maintenance, repair, or replacement of any such facilities, communication links or other equipment, Seller shall repair or replace such equipment as necessary within five (5) days of receipt of such Notice; provided, if Seller is unable to do so, then Seller shall make such repair or replacement as soon as reasonably practical. Seller shall be liable pursuant to Section 4.5(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 the CAISO Tariff. 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.
4.6 Charging and Discharging Energy.
(a) Commencing on the Commercial Operation Date, Buyer will be the Scheduling Coordinator for the Storage Facility and will have sole and exclusive rights to instruct Seller to charge and discharge the Storage Facility by issuing Charging Notices and Discharging Notices to Seller and to bid and schedule the Storage Facility in CAISO markets, subject to the terms of this Agreement, including the Operating Restrictions. (b) Seller shall comply with Charging Notices and Discharging Notices that comply with the terms of this Agreement. Upon receipt of a valid Charging Notice, Seller shall accept the Charging Energy at the Storage Facility in accordance with the terms of this Agreement 43 (including the Operating Restrictions), at the times and in the quantities specified in such Charging Notice. Upon receipt of a valid Discharging Notice, Seller shall deliver the Discharging Energy to the Delivery Point in accordance with the terms of this Agreement (including the Operating Restrictions), at the times and in the quantities specified in such Discharging Notice. (c) Buyer will have the right to instruct charges of the Storage Facility seven (7) days per week and twenty-four (24) hours per day (including holidays), by providing Charging Notices to Seller electronically, provided, Buyer’s right to issue Charging Notices is subject to the requirements and limitations set forth in the CAISO Tariff, other applicable Laws, and this Agreement, including the Operating Restrictions. Each Charging Notice issued in accordance with this Agreement will be effective unless and until Buyer modifies such Charging Notice by providing Seller with an updated Charging Notice.
(d) Seller shall not charge the Storage Facility during the Contract Term other than pursuant to a valid Charging Notice or in connection with a Storage Capacity Test (for which Seller may request a Charging Notice from Buyer), or pursuant to a notice from CAISO, the PTO, or any other Governmental Authority. If, during the Contract Term, Seller (i) charges the Storage Facility to a Stored Energy Level greater than the Stored Energy Level provided for in the Charging Notice (except as permitted in the first sentence of this Section 4.6(d)), or (ii) charges the Storage Facility in violation of the first or second sentence of Section 4.6(b), then, in addition to any other costs and charges for which Seller is responsible, including Imbalance Energy costs and other amounts specified in Section 4.3(c), and without limiting any of Buyer’s other rights under this Agreement:
(i) Seller shall be responsible for all Energy costs associated with such charging of the Storage Facility; and
(ii) the Monthly Storage Availability calculation shall be affected to the extent specified in Exhibit M.
(e) Subject to compliance with the CAISO Tariff, other applicable Laws and the Operating Restrictions, Buyer will have the right to instruct discharges of the Storage Facility seven (7) days per week and twenty-four (24) hours per day (including holidays), by providing Discharging Notices to Seller electronically and subject to the requirements and limitations set forth in this Agreement, including the Operating Restrictions. Each Discharging Notice issued in accordance with this Agreement will be effective unless and until Buyer modifies such Discharging Notice by providing Seller with an updated Discharging Notice. (f) Seller shall not discharge the Storage Facility during the period commencing upon Commercial Operation and continuing throughout the Delivery Term other than pursuant to a valid Discharging Notice or in connection with a Storage Capacity Test (for which Seller may request a Charging Notice from Buyer), or pursuant to a notice from CAISO, the PTO, or any other Governmental Authority. Discharging for Station Use may occur only as specified in Section 6.4. In the case of a Storage Capacity Test, Buyer shall pay for costs associated with the Charging Energy and may retain any revenue from the discharge of such Energy (adjusted for efficiency losses) pursuant to a valid Discharging Notice; provided, Seller shall pay the costs associated with the Charging Energy if (i) Seller initiates the tests in accordance with Exhibit N 44 or (ii) a Buyer-initiated test indicates that the Storage Capacity is two percent (2%) or more lower than the then-current Storage Capacity. If, during the Contract Term, Seller (i) discharges the Storage Facility to a Stored Energy Level less than the Stored Energy Level provided for in the Discharging Notice (except as permitted in the first or second sentence of this Section 4.6(f)), or (ii) discharges the Storage Facility in violation of the first or second sentence of this Section 4.6(f), then, in addition to any other costs and charges for which Seller is responsible, including Imbalance Energy costs and other amounts specified in Section 4.3(c), and without limiting any of Buyer’s other rights under this Agreement:
(i) Buyer shall retain any positive revenues received from CAISO or otherwise associated with such discharge;
(ii) Seller shall be responsible for and reimburse Buyer for all Energy costs associated with charging the Storage Facility to the Stored Energy Level specified by Buyer before the discharge; and
(iii) the Monthly Storage Availability calculation shall be affected to the extent specified in Exhibit M.
(g) Notwithstanding anything in this Agreement to the contrary, during any Settlement Interval, Curtailment Orders, Buyer Curtailment Orders, and Buyer Bid Curtailments applicable to such Settlement Interval shall have priority over any Discharging Notices applicable to such Settlement Interval (but not over Charging Notices which are consistent with such Curtailment Orders, Buyer Curtailment Orders, or Buyer Bid Curtailments), and Seller shall have no liability for violation of this Section 4.6 or any Discharging Notice if and to the extent such violation is caused by Seller’s compliance with any Curtailment Order, Buyer Curtailment Order, Buyer Bid Curtailment, or other instruction or direction from a Governmental Authority or the PTO unless caused by Seller’s fault or negligence. Buyer shall have the right, but not the obligation, to provide Seller with updated Charging Notices and Discharging Notices during any Buyer Curtailment Order, Buyer Bid Curtailment, or Curtailment Order consistent with the Operating
Restrictions.
(h) Prior to Commercial Operation, (i) Buyer shall have no rights to issue or cause to be issued Charging Notices or Discharging Notices, (ii) Seller shall have exclusive rights to charge and discharge the Storage Facility (provided, Seller shall only charge and discharge the Storage Facility in connection with installation, commissioning and testing of the Storage Facility, and, commencing upon CAISO Commercial Operation, subject to the Operating Restrictions), (iii) all CAISO costs, revenues, penalties and other amounts owing to or paid by CAISO in respect of the Storage Facility testing shall be for Seller’s account. Upon Commercial Operation, Buyer shall have exclusive rights to issue or cause to be issued Charging Notices or Discharging Notices.
4.7 [
4.8 Expected Energy and Guaranteed Energy Production. The quantity of PV Energy that Seller expects to be able to deliver to Buyer at the Delivery Point during each Contract 45 Year is set forth on the Cover Sheet (“Expected Energy”). Seller shall be required to deliver to Buyer at the Delivery Point an amount of PV Energy, not including any Excess MWh, equal to no less than the Guaranteed Energy Production (as defined below) in each Contract Year period during the Delivery Term,
(“Performance Measurement Period”). “Guaranteed Energy Production” means an amount of PV Energy, as measured in MWh, equal to the Expected Energy for the constituting such Performance Measurement Period. Seller shall be excused from achieving the Guaranteed Energy Production during any Performance Measurement Period only to the extent that Seller was unable to deliver PV Energy as a result of any Force Majeure Events, Buyer Default, Curtailment Periods and Buyer Curtailment Periods; to effectuate the foregoing excuse, Seller shall be deemed to have delivered to Buyer (a) the Deemed Delivered Energy in respect of Buyer Curtailment Periods, and (b) an amount of Energy determined in accordance with Exhibit D in respect of 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 D.
4.9 WREGIS. Seller shall, at its sole expense, but subject to Section 3.13, 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 PV Energy are issued and tracked for purposes of satisfying the requirements of the California Renewables Portfolio Standard 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, issuance, and transfer of such WREGIS Certificates to Buyer, and Buyer shall be given sole title to all such WREGIS Certificates. In addition:
(a) Prior to the Commercial Operation Date, Seller shall register the Facility with WREGIS and establish an account with WREGIS (“Seller’s WREGIS Account”), which Seller shall maintain until the end of the Delivery Term. Seller shall transfer the WREGIS Certificates using “Forward Certificate Transfers” (as described in the WREGIS Operating Rules) from Seller’s WREGIS Account to the WREGIS account(s) of Buyer or the accounts 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 itself or its agent to be designated as the Qualified Reporting Entity for the Facility. Seller shall cause Forward Certificate Transfers to occur on a monthly basis in accordance with the certification procedure established by the WREGIS Operating Rules. Since WREGIS Certificates will only be created for whole MWh amounts of Energy generated, any fractional MWh amounts (i.e., kWh) will be carried forward until sufficient generation is accumulated for 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 PV Energy for such calendar month as evidenced by data produced by the Generating Facility Meter.
46 (d) Due to the timing of creation of WREGIS Certificates relative to the timing of invoice payment under Section 8.2, Buyer shall make an invoice payment for a given month in accordance with Section 8.2 before the WREGIS Certificates for such month are formally transferred to Buyer in accordance with the WREGIS Operating Rules and this Section 4.9.
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 issued to Buyer for a calendar month as compared to the PV Energy for the same calendar month (“Deficient Month”). If any WREGIS Certificate Deficit occurs, then the amount of PV Energy in the Deficient Month shall be reduced by the amount of the WREGIS Certificate Deficit for purposes of calculating Buyer’s payment to Seller under Article 8 and the Guaranteed Energy Production for the applicable Performance Measurement Period; provided, Buyer shall pay Seller for any PV Energy that is delivered by Seller without corresponding WREGIS Certificates at a price equal to the lesser of (i) the Renewable Rate, or (ii) the weighted average Day-Ahead LMPs for the PV Energy delivered in the corresponding month. Without limiting Seller’s obligations under this Section 4.9, 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. Seller shall use commercially reasonable efforts to rectify any WREGIS Certificate Deficit as expeditiously as possible.
(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 4.9 after the Effective Date, the Parties promptly shall modify this Section 4.9 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 PV Energy in the same calendar month. (g) STC REC-2. 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. (h) STC REC-1. Transfer of Renewable Energy Credits. 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.
4.10 Financial Statements. Seller shall provide to Buyer, within one hundred twenty (120) days of the end of Seller’s fiscal year or as soon as reasonably practicable following Buyer’s request, unaudited quarterly and annual audited financial statements (including a balance sheet and statements of income and cash flows) of Seller (if available) or an upstream Affiliate which 47 consolidates Seller’s financial information in its financial statements, all prepared in accordance with generally accepted accounting principles in the United States, consistently applied.
4.11 Access to Data and Installation and Maintenance of Weather Station. (a) Commencing on CAISO Commercial Operation, and continuing throughout the Delivery Term, Seller shall provide to Buyer, in a form reasonably acceptable to Buyer, the data set forth below on a real-time basis
; provided, Seller shall agree to make and bear the cost of changes to any of the data delivery provisions below, as requested by Buyer, following CAISO Commercial Operation and continuing throughout the Delivery Term, which changes Buyer determines are necessary to forecast output from the Facility, and comply with Law:
(i) real time, read-only access to meteorological measurements, transformer availability, any other facility availability information, and, if applicable, all parameters necessary for use in the equation under item (vii) of this list; (ii) real time, read-only access to PV Energy, EMS data, including Charging Energy, Discharging Energy, Facility Energy, Storage Facility state-of-charge, and battery rack and inverter status (online or offline) information, and meteorological measurements collected by SCADA system for the Facility; provided, if Buyer is unable to access the Facility’s SCADA system, then upon written request from Buyer, Seller shall provide such information and meteorological measurements to Buyer in 1 minute intervals in the form of a flat file to Buyer through a secure file transport protocol (FTP) system with an e-mail back up for each flat file submittal;
(iii) read-only access to the Generating Facility Meter and the Storage Facility Meter, and all Facility meter data at the Site; (iv) full, real time access to the Facility’s Scheduling and Logging for the CAISO (OMS) client application, or its successor system; (vi) net plant electrical output at the CAISO revenue meter; (vii) instantaneous data measurements at sixty (60) second or increased frequency for the following parameters, which measurements shall be provided by Seller to Buyer in a consolidated data report at least once every five minutes via flat file through a secure file transport protocol (FTP) system with an e-mail backup: (i) back panel temperature (ii) global horizontal irradiance, (iii) plane of array irradiance (if the panels are fixed) or direct normal irradiance (if the panels are tracking), (iv) ambient air temperature, (viii) dewpoint air temperature or relative humidity, (ix) horizontal visibility, (x) precipitation (rain rate), (xi) precipitation (running 30 day total), and (xii) barometric pressure; and (viii) an equation, updated on an ongoing basis to reflect the potential generation of the Facility as a function of insolation (and, if applicable, other weather factors).
Such equation shall take into account the expected availability of the Facility. Seller shall reasonably cooperate with any request from Buyer to adjust the equation due to results that are inconsistent with the observed Facility output.
48 For any month in which the above information and access was not available to Buyer for longer than twenty-four (24) continuous hours, Seller shall prepare and provide to Buyer upon Buyer’s request a report with the Facility’s monthly actual Available Generating Capacity and/or Available Storage Capacity in a form reasonably acceptable to Buyer. (b) Seller shall maintain at least a minimum of one hundred twenty (120) days’ historical data for all data required pursuant to Section 4.11, which shall be available on a minimum time interval of one hour basis or an hourly average basis, except with respect to the meteorological measurements which shall be available on a minimum time interval of ten (10) minute basis. Seller shall provide such data to Buyer within five (5) Business Days of Buyer’s request. (c) Installation, Maintenance and Repair.
(i) Seller, at its own expense, shall install and maintain at least one (1) stand-alone meteorological station at the Site to monitor and report the meteorological data required in Section 4.11(a) of this Agreement. Seller, at its own expense, shall install and maintain a secure communication link in order to provide Buyer with access to the data required in Section
4.11(a) of this Agreement.
(ii) Seller shall maintain the meteorological stations, telecommunications path, hardware, and software necessary to provide accurate data to Buyer or Buyer’s designee to enable Buyer to meet current CAISO scheduling requirements. Seller shall u promptly repair and replace as necessary such
meteorological stations, telecommunications path, hardware and software and shall notify Buyer as soon as Seller learns that any such telecommunications paths, hardware and software are providing faulty or incorrect data.
(iii) If Buyer notifies Seller of the need for maintenance, repair or replacement of the meteorological stations, telecommunications path, hardware or software, Seller shall maintain, repair or replace such equipment as necessary within five (5) days of receipt of such Notice; provided, if Seller is unable to repair or replace such equipment within five (5) days, then Seller shall make such repair or replacement as soon as reasonably practical; provided further, Seller shall not be relieved from liability for any Imbalance Energy costs incurred under Section
3.4 during this additional period for repair or replacement. (iv) For any occurrence in which Seller’s telecommunications system is not available or does not provide quality data and Buyer notifies Seller of the deficiency or Seller becomes aware of the occurrence, Seller shall transmit data to Buyer through any alternate means of verbal or written communication, including cellular communications from onsite personnel, facsimile, blackberry or equivalent mobile e-mail, or other method mutually agreed upon by the Parties, until the telecommunications link is re-established. (d) Seller agrees and acknowledges that Buyer may seek and obtain from third parties any information relevant to its duties as Scheduling Coordinator for the Facility, including from the Participating Transmission Operator. Seller shall execute within a commercially reasonable timeframe upon request such instruments as are reasonable and necessary to enable Buyer to obtain from the Participating Transmission Operator information concerning Seller and 49 the Facility that may be necessary or useful to Buyer in furtherance of Buyer’s duties as Scheduling Coordinator for the Facility.
(e) No later than ninety (90) days before the Commercial Operation Date, Seller shall provide one (1) year, if available, but no less than six (6) months, of recorded meteorological data to Buyer in a form reasonably acceptable to Buyer from a weather station at the Site. Such weather station shall provide, via remote access to Buyer, all data relating to (i) the parameters (other than back panel temperature) identified in Section 4.11(a)(vi) above (all data, except peak values, should be 1-second samples averaged into 10-minute periods); (ii) elevation, latitude and longitude of the weather station; and (iii) any other data reasonably requested by Buyer.
4.12 Storage Availability and Efficiency.
(a) Storage Availability. During the Delivery Term, the Storage Facility shall maintain a Monthly Storage Availability (calculated in accordance with Exhibit M) of no less than Guaranteed Storage Availability. If, in any month after Commercial Operation, the Monthly Storage Availability is less than the Guaranteed Storage Availability, then, except as provided in Section 11.1(b)(vi), Buyer’s sole and exclusive remedy for such shortfall shall be the application of the Storage Availability Adjustment to reduce the Storage Capacity Payment due for the Storage Product as provided in Section 3.3(e).
(b) Round-Trip Efficiency. During each month of the Delivery Term, the Storage Facility shall maintain a Round-Trip Efficiency of no less than the Guaranteed Round-Trip Efficiency. If, in any month during the Delivery Term, the Round-Trip Efficiency is less than the Guaranteed Round-Trip Efficiency, then, except as provided in Section 11.1(b)(vii), Buyer’s sole and exclusive remedy (and Seller’s sole and exclusive liability) for such shortfall shall be the RTE Shortfall Payment calculated in accordance with Exhibit Q.
4.13 Storage Capacity Tests.
(a) Prior to the Commercial Operation Date, Seller shall schedule and complete a Commercial Operation Storage Capacity Test in accordance with Exhibit N. Thereafter, Seller and Buyer shall have the right to conduct additional Storage Capacity Tests in accordance with Exhibit N.
(b) Buyer shall have the right to send one or more representatives to witness all Storage Capacity Tests. Buyer shall be responsible for all costs, expenses and fees payable or reimbursable to its representatives witnessing any Storage Capacity Test. (c) Following each Storage Capacity Test, Seller shall submit a testing report in accordance with Exhibit N. If the actual capacity determined pursuant to a Storage Capacity Test deviates from the then current Storage Capacity, then the actual capacity determined pursuant to a Storage Capacity Test (up to, but not in excess of, the Guaranteed Storage Capacity) shall become the new Storage Capacity, effective as of the first day following the completion of the Storage Capacity Test, for all purposes under this Agreement, including compensation under Section 3.3(e) until the next such Storage Capacity Test. 50 4.14 Storage Facility Modifications. Seller shall not modify or supplement all or any part of the Storage Facility,
, without Buyer’s prior written consent, which consent
shall be not be unreasonably withheld, conditioned or delayed.
4.15 Ancillary Services. Buyer shall have the exclusive rights to all Ancillary Services that the Storage Facility is capable of providing consistent with the Operating Restrictions, with characteristics and quantities determined in accordance with the CAISO Tariff. Seller shall operate and maintain the Storage Facility throughout the Contract Term so as to be able to provide such Ancillary Services in accordance with the specifications set forth in the Facility’s initial CAISO Certification associated with the Installed Storage Capacity. If the Storage Facility fails, or is unable, to provide Ancillary Services for any reason (including by reason of failing an Ancillary Services certification test) that is not excused hereunder, then as exclusive remedies the Available Storage Capacity for any applicable Calculation Interval shall be deemed reduced for purposes of calculating the Monthly Storage Availability by an amount equal to the product of (a) the Available Storage Capacity multiplied by (b) , and Seller shall also reimburse Buyer for any CAISO charges or penalties arising from the failure to provide such Ancillary Services. Upon Buyer’s reasonable request, Seller shall submit the Storage Facility for additional CAISO Certification so that the Storage Facility may provide additional Ancillary Services that the Storage Facility is, at the relevant time, actually physically capable of providing consistent with the definition of Ancillary Services herein and without modification of the Storage Facility, provided, Buyer has agreed to reimburse Seller for any costs Seller incurs in connection with conducting such additional CAISO Certification.
4.16 Workforce Agreement. The Parties acknowledge that in connection with Buyer’s 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, 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 4.16.
4.17 Diverse Business Enterprises. During the Delivery Term, no later than twenty (20) days after each semi-annual period ending on June 30th or December 31st, Seller shall provide to Buyer a report listing all Diverse Business Enterprises that supplied goods or services to Seller during such period, including (i) any certifications or other documentation of such Diverse Business Enterprises status as such, (ii) the business address and other contact information of such Diverse Business Enterprises, (iii) the aggregate amount paid to Diverse Business Enterprises during such period and (iv) any other information Buyer reasonably determines is necessary to meet its related reporting obligations.
(a) Buyer has the right to disclose to the CPUC all such information provided by Seller pursuant to this Section 4.17.
51 (b) Seller shall make reasonable efforts to accommodate requests by the CPUC (or by Buyer in response to a request by the CPUC) to audit Seller in order to verify data provided by Seller pursuant to this Section 4.17.
4.18 Shared Facilities. The Parties acknowledge and agree that certain of the Shared Facilities may be subject to shared facilities and/or co-tenancy agreements entered into among Seller, the Transmission Provider, Seller’s Affiliates, and/or third parties. If applicable, Seller agrees that any agreements regarding Shared Facilities (i) shall permit Seller to perform or satisfy, and shall not purport to limit, Seller’s obligations hereunder, (ii) shall provide for separate metering of the Facility, (iii) shall not limit Buyer’s ability to provide Charging Notices and Discharging Notices up to the full Storage Capacity, (iv) shall 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) shall provide that any curtailment or restriction of Shared Facility capacity not attributable to a specific project or projects shall be allocated to all generating or storage facilities utilizing the Shared Facilities based on their pro rata allocation of the Shared Facility capacity prior to such curtailment or reduction Seller shall not, and shall not permit
any Affiliate to, allocate to other Persons 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.
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 delivery or making available to Buyer, including on Energy prior to the Delivery Point. 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 from the Delivery Point (other than withholding or other Taxes imposed on Seller’s income, revenue, receipts or employees). Seller shall be solely responsible for all taxes, charges or fees imposed on the Facility or Seller by a Governmental Authority for Greenhouse Gas emitted by or attributable to the Facility during the Contract Term, but expressly excluding any taxes, charges or fees related to Greenhouse Gases imposed on Charging Energy or Discharging Energy. 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 Energy or other Product hereunder is exempt from or not subject to any particular Tax, Buyer shall provide Seller with all necessary documentation within thirty (30) days after the Effective Date to evidence such exemption or exclusion. If Buyer does not provide such documentation, then Buyer shall indemnify, defend, and hold Seller harmless from any liability with respect to Taxes from which Buyer claims it is exempt.
5.2 Cooperation. Each Party shall use reasonable efforts to implement the provisions of and administer this Agreement in accordance with the intent of the Parties to minimize all Taxes, so long as no Party is materially adversely affected by such efforts. The Parties shall cooperate to minimize Tax exposure; provided, neither Party shall be obligated to incur any financial or operational burden to reduce Taxes for which the other Party is responsible hereunder without 52 receiving due compensation therefor from the other Party. All Energy delivered by Seller to Buyer hereunder shall be a sale made at wholesale, with Buyer reselling such Energy.
5.3 Ownership. Seller shall be the owner of the Facility for federal income tax purposes and, as such, Seller (or its Affiliates) shall be entitled to all depreciation deductions associated with the Facility and to any and all Renewable Energy Incentives or other tax benefits associated with the Facility, including any such tax credits or tax benefits under the Internal Revenue Code of 1986, as amended. The Parties intend this Agreement to be a “service contract” within the meaning of Section 7701(e)(3) of the Internal Revenue Code of 1986, as amended. The Parties will not take the position on any tax return or in any other filings suggesting that it is anything other than a purchase of the Product from the Seller or that this agreement is anything other than a “service contract” within the meaning of Section 7701(e)(3) of the Internal Revenue Code of 1986, as amended.
ARTICLE 6
MAINTENANCE OF THE FACILITY
6.1 Maintenance of the Facility. Seller shall comply with Law and Prudent Operating Practice relating to the operation and maintenance of the Facility and the generation and sale of Product.
(a) Seller shall provide to Buyer no later than ninety (90) days prior to the Commercial Operation Date for the period from the Commercial Operation Date through the end of the then-current calendar year, and no later than September 1 of each calendar year thereafter for the following calendar year, a schedule of all planned outages or derates of the Facility for maintenance purposes (“Scheduled Maintenance”). Seller may perform no more than of Scheduled Maintenance that involves a reduction in the Available Generating Capacity and/or Available Storage Capacity of the Facility per Contract Year. Seller shall not conduct Scheduled Maintenance between June 1 and of each year. Seller shall use commercially reasonable efforts to accommodate reasonable requests of Buyer with respect to adjusting the timing of Scheduled Maintenance. Seller may modify its schedule of Scheduled Maintenance upon reasonable advance notice to Buyer, subject to reasonable requests of Buyer and consistent with Section 4.4 and this Section 6.1.
(b) Seller shall use commercially reasonable efforts to perform during periods of Scheduled Maintenance all maintenance that will reduce the Facility’s output or availability.
Seller shall arrange for any necessary non-emergency maintenance that is not Scheduled Maintenance and that reduces the Available Generating Capacity and/or Available Storage Capacity of the Facility by more than ten percent (10%) to occur only between November 1 and May 31 of each year, unless (i) such outage is required to avoid damage to the Facility, persons or property, (ii) such maintenance is necessary to maintain equipment warranties and cannot be scheduled outside the months of June through September, (iii) the Parties agree otherwise in writing.
(c) Seller shall use commercially reasonable efforts to schedule all maintenance outages, including those associated with Scheduled Maintenance (i) within a single month, rather than across multiple months, (ii) during periods in which CAISO does not require resource 53 substitution or replacement, and (iii) otherwise in a manner to avoid reductions in the Resource Adequacy Benefits available from the Facility to Buyer, provided, Seller shall not be required to consolidate preventative maintenance activities into a single month where such consolidation is inconsistent with vendor-recommended maintenance schedules.
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 on Exhibit R Notice of such condition. Such action may include disconnecting and removing all or a portion of the Facility, or suspending the supply of Energy to Buyer.
6.3 Permits and Approvals. As between Buyer and Seller, Seller shall obtain any required permits and approvals in connection with the development, construction, and operation of the Facility, including without limitation, environmental clearance under the California Environmental Quality Act or other environmental Law, from the state or local jurisdiction where the Facility will be constructed.
6.4 Energy to Serve Station Use. Notwithstanding anything to the contrary in this Agreement, the Parties acknowledge (a) Seller is responsible for providing all Energy to serve Station Use (including paying the cost of any Energy used to serve Station Use and the cost of energy provided by third parties used to serve Station Use); and (b) Seller may utilize Energy to serve Station Use to the extent permissible in accordance with the CAISO Tariff and subject to the following requirements and restrictions:
(i) Seller shall not bill Buyer and Buyer will not pay Seller for any Energy that serves Station Use, and Seller shall bear all costs associated with Energy that serves Station Use, including (A) any Energy produced by the Generating Facility that serves Station Use; (B) any
Stored Energy or Energy discharged from the Storage Facility, that serves Station Use during periods when such service is permissible in accordance with the CAISO Tariff (ii)
to ensure that records and invoices to Buyer are
accurate and do not improperly bill Buyer for Energy that serves Station Use and to enable Buyer to invoice Seller for Reimbursable Station Use Payments; (iii) Seller shall ensure that any use of
Stored Energy or Energy discharged from the
Storage Facility, to serve Station Use, complies with and does not interfere with or impair Buyer’s or the CAISO’s dispatch of or schedule for the Facility, and if Seller fails to comply with such requirements, then, without prejudice to Buyer’s other rights and remedies 54 hereunder, Seller shall reimburse Buyer for (A) any charges, costs, and penalties imposed by the CAISO for the Storage Facility’s failure to comply with dispatch instructions, the CAISO schedule, or any CAISO requirements; and (B) any loss of revenue if the CAISO adjusts dispatch instructions due to the use of Stored Energy or Energy discharged from the Storage Facility to serve Station Use, in each case only to the extent imposed or incurred as a direct result of Seller’s use of Stored Energy or Energy discharged from the Storage Facility to serve Station Use; (iv) Any use of Energy generated by the Generating Facility, Energy discharged from the Storage Facility or Stored Energy for Station Use shall not (A) reduce Seller’s obligations to achieve the Guaranteed Storage Availability and Guaranteed Round-Trip Efficiency, or (B) count toward limits specified in the Operating Restrictions; and (v) Seller shall provide to Buyer upon Buyer’s request all records and data, including detailed meter, charging, discharging, and state of charge data, that may be necessary or useful for Buyer to verify that service of Station Use occurred in compliance with this Section 6.4, and to calculate and verify the accuracy of invoices and amounts required to be reimbursed hereunder.
ARTICLE 7
METERING
7.1 Metering.
(a) Subject to Section 7.1(b) (with respect to the entirety of the following Section 7.1(a)), the Facility shall have separate CAISO Resource IDs for each of the Generating Facility and the Storage Facility. The Facility shall be configured as a Seller shall measure the following using CAISO Approved Meters and CAISO approved methodologies : the amount of Facility Energy produced by the Facility; the amount of PV Energy produced by the Generating Facility; and the amount of Charging Energy and Discharging Energy;
. The CAISO Approved Meter shall be installed and maintained at Seller’s cost.
Metering will be consistent with the Metering
Diagram set forth in Exhibit P,
The meter(s) shall be kept under seal, such seals to be broken only when the meters are to be tested, adjusted, modified or relocated. In the event that Seller breaks a seal, Seller shall notify Buyer as soon as practicable. In addition, Seller hereby agrees to provide all meter data to Buyer in a form reasonably acceptable to Buyer, and consents to Buyer obtaining from CAISO all meter data applicable to each of the Generating Facility and the Storage Facility and all inspection, testing and calibration data and reports,
. Seller and Buyer shall cooperate to allow both
Parties to retrieve the meter reads from the CAISO Operational Meter Analysis and Reporting (OMAR) web and/or directly from the meter(s) at the Generating Facility and the Storage Facility, 55 (b) The foregoing Section 7.1(a) is based on the Parties’ mutual understanding as of the Effective Date that (i) the CAISO requires the configuration of the Facility to include as the sole meters for the Facility, the Generating Facility Meter and the Storage Facility Meter, (ii) the CAISO requires the Generating Facility Meter and the Storage Facility Meter to be programmed for Electrical Losses as set forth in the definition of Electrical Losses in this Agreement, and (iii) the automatic adjustments to Charging Notices and Discharging Notices as set forth in the definitions of Charging Notice and Discharging Notice in this Agreement will not result in the Scheduling Coordinator violating, or incurring any costs, penalties, or charges under, the CAISO Tariff. If any of the foregoing mutual understandings in (i), (ii), or (iii) between the Parties become incorrect during the Delivery Term, the Parties shall cooperate in good faith to make any amendments and modifications to the Facility and this Agreement as are reasonably necessary to conform this Agreement to the CAISO Tariff and avoid, to the maximum extent practicable, any CAISO charges, costs, or penalties that may be imposed on either Party due to non-conformance with the CAISO Tariff, such agreement not to be unreasonably delayed, conditioned, or withheld. In the case of preceding clause (iii), until the Parties agree on an alternative approach, Seller shall be responsible for all CAISO costs, penalties, and charges that result from Seller’s compliance with the automatic adjustments of Charging Notices and Discharging Notices as set forth in the definitions of Charging Notice and Discharging Notice in this Agreement, and in connection with any automatic adjustment to a Discharging Notice set forth in the definition of Discharging Notice, if any such automatic adjustment is prohibited by CAISO, then Seller shall instead reduce deliveries of PV Energy to the Delivery Point as necessary to avoid exceeding the Interconnection Capacity Limit and such reductions shall be treated as Lost Output.
7.2 Meter Verification. If Buyer or Seller has reason to believe there may be a meter malfunction, Seller shall test the meter. Annually, 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 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.
ARTICLE 8
INVOICING AND PAYMENT; CREDIT
8.1 Invoicing. Seller shall deliver an invoice to Buyer for Product no later than after the end of the prior monthly billing period. Each invoice shall provide Buyer (a) records of metered data, including CAISO metering and transaction data sufficient to document and verify the generation of Product by the Generating Facility and the Storage Facility for any Settlement Period during the preceding month, the amount of Product in MWh produced by the Facility as read by the Generating Facility Meter, Storage Facility Meter, and CAISO Approved Meter, the amount of Replacement RA delivered to Buyer, the calculation of Deemed Delivered Energy and Adjusted Energy Production, and the Contract Price applicable to such Product, Station Use and Reimbursable Station Use for any Settlement Period during the preceding month; (b) 56 records and calculations sufficient to show the calculation of the Storage Capacity Payment, including calculations of any applicable Storage Availability Adjustment and Round-Trip Efficiency Adjustment; and (c) access to any records, including invoices or settlement data from the CAISO, necessary to verify the accuracy of any amount. Invoices shall be in a format specified by Buyer, covering the services 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 by wire transfer or ACH payment to the bank account provided on each monthly invoice. Buyer shall pay undisputed invoice amounts within 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. Either Party, upon fifteen (15) days written Notice to the other 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.
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 otherwise disputed under Section 8.5, 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. Except for adjustments required due to a correction of data by the CAISO, any adjustment described in this Section 8.4 is waived if Notice of the adjustment is not provided within twelve (12) months after the invoice is rendered or subsequently adjusted.
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 57 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 upon request or deducted by the Party receiving such overpayment from subsequent payments, with interest accrued at the Interest Rate from and including the date of such overpayment to but excluding the date repaid or deducted by the Party receiving such overpayment. 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 party other than the Party seeking the adjustment and such 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, including any related damages calculated pursuant to Exhibits B and D, 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 Seller’s obligations under this Agreement, including the obligations of Seller to pay liquidated damages to Buyer as provided in this Agreement, Seller shall deliver Development Security to Buyer within after the Effective Date. Buyer will have the right to draw upon the Development Security if Seller fails to pay liquidated damages owed to Buyer pursuant to Exhibit B to this Agreement, or if Seller fails to pay a Damage Payment owed to Buyer pursuant to Section 11.2. Seller shall maintain the Development Security in full force and effect and Seller shall replenish the Development Security in the event Buyer collects or draws down any portion of the Development Security for any reason permitted under this Agreement other than to satisfy a Damage Payment, Following the earlier of (i) Seller’s delivery of the Performance Security, or (ii) sixty (60) days after termination of this Agreement, Buyer shall promptly 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 replenish the Performance Security in the event Buyer collects or draws down any portion of the Performance Security for any reason permitted under this Agreement within five (5) Business Days after such draw, other than to satisfy a Termination Payment. Seller shall maintain the Performance 58 Security in full force and effect until the date on which the following have occurred (“Performance Security End Date”): (A) the Delivery Term has expired or terminated early; and (B) all payment obligations of the Seller arising 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 the Performance Security End Date, Buyer shall promptly return to Seller the unused portion of the Performance Security. Provided that no Event of Default has occurred with respect to Seller, Seller may replace or change the form of Performance Security to another form of Performance Security from time to time upon reasonable prior written notice to Buyer.
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 these obligations are satisfied in full.
ARTICLE 9
59 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 R or at such other address or addresses as a Party may designate for itself from time to time by Notice hereunder.
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, facsimile, or other electronic means) and either (i) the receiving Party sends a written acknowledgment of receipt, or (ii) concurrently with the transmittal of such electronic communication the sending Party provides a copy of such electronic Notice by hand delivery or express courier, at the time indicated by the time stamp upon delivery; 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 reasonable efforts, cannot be avoided by and is beyond the reasonable control (whether direct or indirect) of and without the fault or negligence of the Party relying thereon as justification for such delay, nonperformance, or noncompliance. (b) Without limiting the generality of the foregoing, so long as the following events, despite the exercise of reasonable efforts, cannot be avoided by, and are beyond the reasonable control (whether direct or indirect) of and without the fault or negligence of the Party relying thereon as justification for such delay, nonperformance or noncompliance, a Force Majeure Event may include an act of God or the elements, such as flooding, lightning, hurricanes, tornadoes, or ice storms; explosion; fire; volcanic eruption; flood; epidemic; landslide; mudslide; sabotage; terrorism; earthquake; or other cataclysmic events; an act of public enemy; war; blockade; civil insurrection; riot; civil disturbance; or strikes or other labor difficulties caused or suffered by a Party or any third party except as set forth below.
60 (c) Notwithstanding the foregoing, the term “Force Majeure Event” does not include (i) economic conditions that render a Party’s performance of this Agreement at the Contract Price unprofitable or otherwise uneconomic (including an increase in component or compliance costs for any reason, including foreign or domestic tariffs, Buyer’s ability to buy the Product at a lower price, or Seller’s ability to sell the Product at a higher price, than the Contract Price); (ii) Seller’s inability to obtain permits or approvals of any type for the construction, operation, or maintenance of the Facility,
(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 that disables physical or electronic facilities necessary to transfer funds to the payee Party; (iv) a Curtailment Period, except to the extent such Curtailment Period is caused by a Force Majeure Event; (v) Seller’s inability to obtain sufficient labor, equipment, materials, or other resources to build or operate the Facility except to the extent such inability is caused by a Force Majeure Event; (vi) 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; (viii) or (ix) failure to complete the
interconnection facilities or network upgrades required to connect the Facility and to deliver Product to the Delivery Point by the Guaranteed Commercial Operation Date except to the extent such inability is caused by a Force Majeure Event; or (x) Seller’s inability to achieve Construction Start of the Facility following the Guaranteed Construction Start Date or achieve Commercial Operation following the Guaranteed Commercial Operation Date; it being understood and agreed, for the avoidance of doubt, that the occurrence of a Force Majeure Event may give rise to a Development Cure Period.
10.2 No Liability If a Force Majeure Event Occurs. Neither Seller nor Buyer shall be liable to the other Party in the event it is prevented from performing its obligations hereunder in whole or in part due to a Force Majeure Event. Buyer shall not be obligated to pay for any Product that Seller was not able to deliver as a result of 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
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 the event of any delay or nonperformance resulting from a Force Majeure Event, the Party suffering the Force Majeure Event shall (a) as soon as practicable, notify the other 61 Party in writing of the nature, cause, estimated date of commencement thereof, and the anticipated extent of any delay or interruption in performance, and (b) notify the other Party in writing of the cessation or termination of such Force Majeure Event, all as known or estimated in good faith by the affected Party; provided, a Party’s failure to give timely Notice shall not affect such Party’s ability to assert that a Force Majeure Event has occurred unless the delay in giving Notice materially prejudices the other Party.
10.4 Termination Following Force Majeure Event. If a Force Majeure Event has occurred that has caused either Party to be wholly or partially unable to perform its obligations hereunder, and has continued for a consecutive twelve (12) month period, then the non-claiming Party may terminate this Agreement upon written Notice to the other Party with respect to the Facility experiencing the Force Majeure Event. Upon any such termination, neither Party shall have any liability to the other, save and except for those obligations specified in Section 2.1(c), and Buyer shall promptly return to Seller any Development Security or Performance Security then held by Buyer.
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 five (5) 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 (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) and such failure is not remedied within thirty (30) days after Notice thereof (iv) such Party becomes Bankrupt;
(v) such Party assigns this Agreement or any of its rights hereunder other than in compliance with Sections 14.2 or 14.3, as 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 62 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. (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 to the Delivery Point for sale under this Agreement Energy that was not generated or discharged by the Facility, except with respect to Replacement RA;
(ii) the failure by Seller to achieve the Construction Start Date within one hundred twenty (120) days after the Guaranteed Construction Start Date, or the failure by Seller to achieve Commercial Operation within one after the Guaranteed Commercial Operation Date;
(iii) the failure by Seller to timely obtain CEC Final Certification and Verification in accordance with Section 3.10;
(iv) if, in the first six (6) months or the second six (6) months of any Contract Year, the Adjusted Energy Production amount is not at least ten percent (10%) of the Expected Energy amount for that Contract Year, and Seller fails to demonstrate to Buyer’s reasonable satisfaction, within ten (10) Business Days after Notice from Buyer, the failure to meet the ten percent (10%) minimum;
(v) if in any two (2) consecutive Contract Years, the Adjusted Energy Production amount is not at least sixty-five percent (65%) of the Expected Energy amount in each Contract Year;
(vi) if, in the first Contract Year during the Delivery Term, the average Monthly Storage Availability is not at least fifty percent (50%), or for any Contract Year thereafter, the average Monthly Storage Availability is not at least seventy percent (70%); provided,
(vii) if, for any two (2) consecutive Contract Years, the annual average Round-Trip Efficiency is not at least
(viii) if, in any Contract Year, Seller fails to maintain an average Storage Capacity determined pursuant to one or more Storage Capacity Tests equal to at least seventy-five percent (75%) of the Installed Storage Capacity; provided, (ix) failure by Seller to satisfy the collateral requirements pursuant to Sections 8.7 or 8.8, including the failure to replenish the Development Security or Performance
64 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 (in the case of an Event of Default by Seller under Section 11.1(b)(ii)) or (ii) the Termination Payment, each as 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/or
(e) to exercise any other right or remedy available at law or in equity, including specific performance or injunctive relief, except to the extent such remedies are expressly limited under this Agreement;
provided, 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).
(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 65 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 calculated in the same manner as the Termination Payment in Section 11.3(b). (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 on or after the Commercial Operation Date (“Termination Payment”) for a Terminated Transaction shall be the Settlement Amount plus any or all other amounts due to or from the Non-Defaulting Party netted into a single amount. If the Non-Defaulting Party’s aggregate Gains exceed its aggregate Losses and Costs, if any, resulting from the termination of this Agreement, the net Settlement Amount shall be zero. 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; provided, any lost Capacity Attributes shall be deemed direct damages covered by this Agreement. 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. As soon as practicable after a Terminated Transaction, Notice shall be given by the Non-Defaulting Party to the Defaulting Party of the amount of the Termination Payment and whether the Termination Payment is due to or from the Non-Defaulting Party. The Notice shall include a written statement explaining in reasonable detail the calculation of such amount and the sources for such calculation. The undisputed portion of the Termination Payment shall be made to or from the Non-Defaulting Party, as applicable, within ten (10) Business Days after such Notice is effective.
11.5 Disputes With Respect to Termination Payment. If the Defaulting Party disputes the Non-Defaulting Party’s calculation of the Termination Payment, in whole or in part, the Defaulting Party shall, within five (5) Business Days of receipt of the Non-Defaulting Party’s calculation of the Termination Payment, provide to the Non-Defaulting Party a detailed written 66 explanation of the basis for such dispute. Disputes regarding the Termination Payment shall be determined in accordance with Article 16.
11.6 Limitation on Seller’s Ability to Make or Agree to Third-Party Sales from the Facility after Early Termination Date.
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 are 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 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 AN EXPRESS REMEDY, INDEMNITY PROVISION (EXCLUDING SECTION 11.6), OR
MEASURE OF DAMAGES HEREIN, 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, 67 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 BENEFITS, 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 THE DAMAGE PAYMENT UNDER SECTION 11.3(a) AND THE TERMINATION PAYMENT UNDER SECTION 11.3(b), AND AS PROVIDED IN
EXHIBIT B AND EXHIBIT D, 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, AND (UNLESS EXPRESSLY STATED TO THE CONTRARY) AN EXCLUSIVE REMEDY. IT IS THE INTENT OF THE PARTIES THAT THE LIMITATIONS HEREIN
IMPOSED ON REMEDIES AND THE MEASURE OF DAMAGES BE WITHOUT REGARD
TO THE CAUSE OR CAUSES RELATED THERETO, INCLUDING THE NEGLIGENCE OF
ANY PARTY, WHETHER SUCH NEGLIGENCE BE SOLE, JOINT OR CONCURRENT, OR ACTIVE OR PASSIVE. THE PARTIES HEREBY WAIVE ANY RIGHT TO CONTEST SUCH PAYMENTS AS AN UNREASONABLE PENALTY.
ARTICLE 13
68 REPRESENTATIONS AND WARRANTIES; AUTHORITY
13.1 Seller’s Representations and Warranties. As of the Effective Date, Seller represents and warrants as follows:
(a) Seller is a limited liability company, duly organized, validly existing and in good standing under the laws of the State of Delaware, 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 corporate 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 is located in the State of California.
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 69 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. Buyer will not assert sovereign immunity as a defense to the enforcement of its obligations under this Agreement. (f) Buyer is a “local public entity” as defined in Section 900.4 of the Government Code of the State of California.
13.3 General Covenants. Each Party covenants that commencing on the Effective Date and continuing throughout the Contract Term:
(a) It shall continue to be duly organized, validly existing and in good standing under the Laws of the jurisdiction of its formation and to be qualified to conduct business in 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 any contracts to which it is a party and in material compliance with any Law.
ARTICLE 14
70 ASSIGNMENT
14.1 General Prohibition on Assignments. Except as provided below and in Article 15, neither Seller nor Buyer may voluntarily assign its rights nor delegate its duties under this Agreement, or any part of such rights or duties, without the written consent of the other Party.
Neither Seller nor Buyer shall unreasonably withhold, condition or delay any requested consent to an assignment that is allowed by the terms of this Agreement. Any such assignment or delegation made without such written consent or in violation of the conditions to assignment set out below shall be null and void.
14.2 Permitted Assignment; Change of Control of Seller. Seller may, without the prior written consent of Buyer, transfer or assign this Agreement to: (a) an Affiliate of Seller; or (b) subject to Section 15.1, a Lender as collateral. Any Change of Control of Seller (whether voluntary or by operation of Law) shall be deemed an assignment under this Article 14 and will require the prior written consent of Buyer, which consent shall not be unreasonably withheld.
14.3 Permitted Assignment; Change of Control of Buyer. Buyer may assign its interests in this Agreement to an Affiliate of Buyer or to any entity that has acquired all or substantially all of Buyer’s assets or business, whether by merger, acquisition or otherwise without Seller’s prior written consent, provided, in each of the foregoing situations, (a) the assignee (i) has a Credit Rating of or higher by Moody’s or or higher by S&P, and (ii) is a community choice aggregator or publicly-owned electric utility with retail customers located in the state of California, and (b) no fewer than fifteen (15) Business Days before such assignment Buyer (i) notifies Seller of such assignment and (ii) provides to Seller a written agreement signed by the Person to which Buyer wishes to assign its interests stating that such Person agrees to assume all of Buyer’s obligations and liabilities under this Agreement and under any consent to assignment and other documents previously entered into by Seller as described in Section 15.2(b). Any assignment by Buyer, 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 Seller.
14.4 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 in form reasonably acceptable to both Parties (the “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) Baa2 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 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 14.4.
,
71 ARTICLE 15
LENDER ACCOMMODATIONS
15.1 Granting of Lender Interest. Notwithstanding Section 14.2 or Section 14.3, either Party may, without the consent of the other Party, grant an interest (by way of collateral assignment, or as security, beneficially or otherwise) in its rights and/or obligations under this Agreement to any Lender. Each Party’s obligations under this Agreement shall continue in their entirety in full force and effect. Promptly after granting such interest, the granting Party shall notify the other Party in writing of the name, address, and telephone and facsimile numbers of any Lender to which the granting Party’s interest under this Agreement has been assigned. Such Notice shall include the names of the Lenders to whom all written and telephonic communications may be addressed. After giving the other Party such initial Notice, the granting Party shall promptly give the other Party Notice of any change in the information provided in the initial Notice or any revised Notice.
15.2 Rights of Lender. If a Party grants an interest under this Agreement as permitted by Section 15.1, the following provisions shall apply:
(a) Lender shall have the right, but not the obligation, to perform any act required to be performed by the granting Party under this Agreement to prevent or cure a default by the granting Party in accordance with Section 11.2 and such act performed by Lender shall be as effective to prevent or cure a default as if done by the granting Party. (b) The other Party shall cooperate with the granting Party or any Lender, to execute or arrange for the delivery of certificates, consents, opinions, estoppels, direct agreements, amendments and other documents reasonably requested by the granting Party or Lender in order to consummate any financing or refinancing and shall enter into reasonable agreements with such Lender that provide that the non-granting Party recognizes the Lender’s security interest and such other provisions as may be reasonably requested by the granting Party or any such Lender; provided, all costs and expenses (including reasonable attorney’s fees) incurred by the non-granting Party in connection therewith shall be borne by the granting Party, and that the non-granting Party shall have no obligation to modify this Agreement or to reduce its benefits or increase its risks or burdens under this Agreement.
(c) Each Party agrees that no Lender shall be obligated to perform any obligation or be deemed to incur any liability or obligation provided in this Agreement on the part of the granting Party or shall have any obligation or liability to the other Party with respect to this Agreement except to the extent any Lender has expressly assumed the obligations of the granting Party hereunder; provided, the non-granting Party shall nevertheless be entitled to exercise all of its rights hereunder in the event that the granting Party or Lender fails to perform the granting Party’s obligations under this Agreement.
15.3 Cure Rights of Lender. The non-granting Party shall provide Notice of the occurrence of any Event of Default described in Sections 11.1 or 11.2 hereof to any Lender, and 72 such Party shall accept a cure performed by any Lender and shall negotiate in good faith with any Lender as to the cure period(s) that will be allowed for any Lender to cure any granting Party Event of Default hereunder. The non-granting Party shall accept a cure performed by any Lender so long as the cure is accomplished within the applicable cure period so agreed to between the non-granting Party and any Lender. Notwithstanding any such action by any Lender, the granting Party shall not be released and discharged from and shall remain liable for any and all obligations to the non-granting Party arising or accruing hereunder. The cure rights of Lender may be documented in the certificates, consents, opinions, estoppels, direct agreements, amendments and other documents reasonably requested by the granting Party pursuant to Section 15.2(b).
ARTICLE 16
DISPUTE RESOLUTION
16.1 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]
16.2 Dispute Resolution. In the event of any dispute arising under this Agreement, within ten (10) days following the receipt of a written Notice from either Party identifying such dispute, the Parties shall meet, negotiate and attempt, in good faith, to resolve the dispute quickly, informally and inexpensively. If the Parties are unable to resolve a dispute arising hereunder within the earlier of either thirty (30) days of initiating such discussions, or within forty (40) days after Notice of the dispute, 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.
16.3 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, the prevailing Party shall be entitled to reasonable attorneys’ fees (including reasonably allocated fees of in-house counsel) in addition to court costs and any and all other costs recoverable in said action.
16.4 Venue. The Parties agree that any litigation arising with respect to this Agreement is to be venued in the Superior Court for the county of San Mateo, California ARTICLE 17
INDEMNIFICATION
17.1 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 third-party claims, demands, losses, liabilities, penalties, and expenses (including reasonable attorneys’ fees) 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 violation of Law or the negligent or willful misconduct of the Indemnifying Party, its Affiliates, its directors, officers, employees, or agents. 73 (b) Nothing in this Section 17.1 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.
17.2 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 17 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 such 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 17, in the event that a Party is obligated to indemnify and hold the other Party and its successors and assigns harmless under this Article 17, 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.
ARTICLE 18
INSURANCE
18.1 Insurance.
(a) General. Seller shall comply at all times during the Contract Term with the requirements of Exhibit J.
(b) Subcontractor Insurance. Seller shall require all of its subcontractors to carry: (i) comprehensive general liability insurance in amounts equal to those set forth for Seller in Exhibit J; (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, in each case, in amounts equal to those set forth for Seller in Exhibit J. All subcontractors shall name Seller as an additional insured to insurance carried pursuant to clauses (f)(i) and (f)(iii). All subcontractors shall provide a primary endorsement and a waiver of subrogation to Seller for the required coverage pursuant to this Section 18.1(b). 74 (c) Evidence of Insurance. Within ten (10) days after execution of the Agreement and upon annual renewal thereafter, Seller shall deliver to Buyer certificates of insurance evidencing such coverage. These certificates shall specify that Buyer shall be given at least thirty (30) days prior Notice by Seller in the event of any material modification, cancellation or termination of coverage. Such insurance shall be primary coverage without right of contribution from any insurance of Buyer. Any other insurance maintained by Seller is for the exclusive benefit of Seller and shall not in any manner inure to the benefit of Buyer. Seller shall also comply with all insurance requirements by any renewable energy or other incentive program administrator or any other applicable authority.
(d) Failure to Comply with Insurance Requirements. If Seller fails to comply with any of the provisions of this Article 18, 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 18 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 19
CONFIDENTIAL INFORMATION
19.1 Definition of Confidential Information. The following constitutes “Confidential Information,” whether oral or written, and whether delivered by Seller to Buyer or by Buyer to Seller: (a) proposals and negotiations of the Parties in the negotiation of this Agreement; (b) the terms and conditions of this Agreement; and (c) information that either Seller or Buyer stamps or otherwise identifies as “confidential” or “proprietary” or words of similar import 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; (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.
19.2 Duty to Maintain Confidentiality. The Party receiving Confidential Information shall treat it as confidential, and shall adopt reasonable information security measures to maintain its confidentiality, employing the higher of (a) the standard of care that the receiving Party uses to preserve its own confidential information, or (b) a standard of care reasonably tailored to prevent unauthorized use or disclosure of such Confidential Information. Confidential Information may be disclosed by the recipient if and to the extent such disclosure is required (a) by Law, (b) pursuant to an order of a court or (c) in order to enforce this Agreement. The Party that originally discloses 75 Confidential Information may use such information for its own purposes, and may publicly disclose such information at its own discretion. Notwithstanding the foregoing, Seller acknowledges that Buyer is required to make portions of this Agreement available to the public in connection with the process of seeking approval from its board of directors for execution of this Agreement. Buyer may, in its discretion, redact certain terms of this Agreement as part of any such public disclosure, and will use reasonable efforts to consult with Seller prior to any such public disclosure. Seller further acknowledges that Buyer is a public agency subject to the requirements of the California Public Records Act (Cal. Gov. Code section 6250 et seq.). Upon request or demand from any third person not a Party to this Agreement for production, inspection and/or copying of this Agreement or other Confidential Information provided by Seller to Buyer, Buyer shall, to the extent permissible, notify Seller in writing in advance of any disclosure that the request or demand has been made; provided, upon the advice of its counsel that disclosure is required, Buyer may disclose this Agreement or any other requested Confidential Information, whether or not advance written notice to Seller has been provided. Seller shall be solely responsible for taking whatever steps it deems necessary to protect Confidential Information that is the subject of any Public Records Act request submitted by a third person to Buyer.
19.3 Irreparable Injury; Remedies. Buyer and Seller each agree that disclosing Confidential Information of the other in violation of the terms of this Article 19 may cause irreparable harm, and that the harmed Party may seek any and all remedies available to it at Law or in equity, including injunctive relief and/or notwithstanding Section 12.2, consequential damages.
19.4 Disclosure to Lender. Notwithstanding anything to the contrary in this Article 19, Confidential Information may be disclosed by Seller to any potential Lender or any of its agents, consultants or trustees so long as the Person to whom Confidential Information is disclosed agrees in writing to be bound by the confidentiality provisions of this Article 19 to the same extent as if it were a Party.
19.5 Disclosure to Credit Rating Agency. Notwithstanding anything to the contrary in this Article 19, Confidential Information may be disclosed by either Party to any nationally recognized credit rating agency (e.g., Moody’s Investors Service, Standard & Poor’s, or Fitch Ratings) in connection with the issuance of a credit rating for that Party or its Affiliates, provided, any such credit rating agency agrees in writing to maintain the confidentiality of such Confidential Information.
19.6 Public Statements. 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 press release.
ARTICLE 20
MISCELLANEOUS
20.1 Entire Agreement; Integration; Exhibits. This Agreement, together with the Cover Sheet and Exhibits attached hereto constitutes the entire agreement and understanding between Seller and Buyer with respect to the subject matter hereof and supersedes all prior 76 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.
20.2 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.
20.3 Time is of the Essence. The Parties agree that time is of the essence with respect each Party’s performance of its obligations under the Agreement.
20.4 No Waiver. Waiver by a Party of any default by the other Party shall not be construed as a waiver of any other default.
20.5 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).
20.6 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.
20.7 Mobile-Sierra. Notwithstanding any other provision of this Agreement, neither Party shall seek, nor shall they support any third party seeking, to prospectively or retroactively revise the rates, terms or conditions of service of this Agreement through application or complaint to FERC pursuant to the provisions of Section 205, 206 or 306 of the Federal Power Act, or any other provisions of the Federal Power Act, absent prior written agreement of the Parties. Further, absent the prior written agreement in writing by both Parties, the standard of review for changes to the rates, terms or conditions of service of this Agreement proposed by a Party, a non-Party or the FERC acting sua sponte 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). 77 20.8 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.
20.9 Facsimile or Electronic Delivery. This Agreement may be duly executed and delivered by a Party by execution and facsimile or electronic format (including portable document format (.pdf)) delivery of the signature page of a counterpart to the other Party, and, if delivery is made by facsimile or other electronic format, the executing Party shall promptly deliver, via overnight delivery, a complete original counterpart that it has executed to the other Party, but this Agreement shall be binding on and enforceable against the executing Party whether or not it delivers such original counterpart.
20.10 Binding Effect. This Agreement shall inure to the benefit of and be binding upon the Parties and their respective successors and permitted assigns.
20.11 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.
20.12 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 ninety (90) 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 16. 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, or constitute, or form the basis of, a Force Majeure Event, and (ii) this Agreement shall remain in full force and effect, subject to any necessary changes, if any, agreed to by the Parties or determined through dispute resolution.
Exhibit A - 1
EXHIBIT A
DESCRIPTION OF THE FACILITY
Facility Name: IP Darden IV
Site Name: Darden Clean Energy Project
Site Description: See attached as Schedule 1.
Site Address: Seller shall provide thirty (30) days prior to of Construction Start.
GPS Coordinates: 36.470938,-120.21475
Site Map: See attached as Schedule 1.
APNs:
County: Fresno, County
CEQA Lead Agency: California Energy Commission
Generation Technology: First Solar, Single-Axis Tracker. Type and Model to be confirmed.
Storage Technology: Lithium-ion battery
P-node/Delivery Point: The PNode designated by CAISO for each of the Generating Facility and Storage Facility at the PG&E Los Banos-Midway #2 Substation
Point of Interconnection: PG&E’s Los Banos-Midway #2 500kV Transmission Line Description of Interconnection Facilities and Metering: The Facility will use the following Interconnection Facilities and metering configuration, as depicted in the attached one-line diagram: the Facility interconnects at a new 500kV breaker-and-a-half (BAAH) switching station to be self-built by IP and deeded to PG&E. A ~14 mi 500kV gen-tie heading east from a new PG&E station will cross I-5 and terminate at the Facility’s substation, where the Facility’s output will be collected on 34.5kV circuits. Within the Facility’s substation, 8 generator step-up transformers will convert energy coming into the station at 34.5kV up to 500kV for export across the 500kV gen-tie and into a new PG&E Switching Station.
CAISO Queue Number: 1949
2 One-Line Diagram:
Additional Information:
3 Schedule 1
List of all APNs
Darden IV:
4 Site Map
Exhibit B - 1
EXHIBIT B
FACILITY CONSTRUCTION AND COMMERCIAL OPERATION
1. Construction of the Facility.
a. Seller shall cause construction to begin on the Facility by June 1, 2027, (as such date may be extended by the Development Cure Period, the “Guaranteed Construction Start Date”). Seller shall demonstrate the beginning of construction through execution of Seller’s engineering, procurement and construction contract, Seller’s issuance of a notice to proceed under such contract, mobilization to site by Seller and/or its designees, and includes the physical movement of soil at the Site (“Construction Start”). On the date of the beginning of construction (the “Construction Start Date”), Seller shall deliver to Buyer a certificate substantially in the form attached as Exhibit H hereto.
b. If Construction Start is not achieved by the Guaranteed Construction Start Date, Seller shall pay Daily Delay Damages to Buyer on account of such delay. Daily Delay Damages shall be payable for each day for which Construction Start has not begun by the Guaranteed Construction Start Date. Daily Delay Damages shall be payable to Buyer by Seller until the earlier of one hundred twenty (120) days after the Guaranteed Construction Start Date, or the date on which Seller reaches Construction Start of the Facility. On or before the tenth (10th) day of each month, Buyer shall invoice Seller for Daily Delay Damages, if any, accrued during the prior month and, within ten (10) Business Days following Seller’s receipt of such invoice, Seller shall pay Buyer the amount of the Daily Delay Damages set forth in such invoice. Daily Delay Damages shall be refundable to Seller pursuant to Section 3(b) of this Exhibit B. The Parties agree that Buyer’s receipt of Daily Delay Damages shall be Buyer’s sole and exclusive remedy for the first one hundred twenty (120) days of the delay in achieving the Construction Start Date on or before the Guaranteed Construction Start Date, but shall (x) not be construed as Buyer’s declaration that an Event of Default has occurred under any provision of Section 11.1 and (y) not limit Buyer’s right to declare an Event of Default pursuant to Section 11.1(b)(ii) and receive a Damage Payment upon exercise of Buyer’s rights pursuant to Section 11.2.
2. Commercial Operation of the Facility. “Commercial Operation” means the condition existing when (i) Seller has fulfilled all of the conditions precedent in Section 2.2 of the Agreement and (ii) Seller has provided Notice to Buyer that Commercial Operation has been achieved. The “Commercial Operation Date” shall be the later of (x) June 1, 2028 or (y) the date on which Commercial Operation is achieved,
a. Seller shall cause Commercial Operation for the Facility to occur by June 1, 2028 (as such date may be extended by the Development Cure Period (defined below), the “Guaranteed Commercial Operation Date”). Seller shall notify Buyer that it intends to achieve Commercial Operation at least sixty (60) days before the anticipated Commercial Operation Date.
Exhibit C - 1
EXHIBIT C
[Intentionally Omitted]
Exhibit D - 1
EXHIBIT D
GUARANTEED ENERGY PRODUCTION DAMAGES CALCULATION
In accordance with Section 4.8, 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)]
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 calculated as (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
D = the average Renewable Rate for the Performance Measurement Period, in $/MWh
No payment shall be due if the calculation of (A - B) or (C - D) yields a negative number.
Within sixty (60) days after each Performance Measurement Period, Buyer will 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.
Exhibit D - 2
Additional Definitions:
“Adjusted Energy Production” shall mean the sum of the following: PV Energy + Deemed Delivered Energy + Lost Output – Excess MWh.
“Lost Output” means the amount of Energy that qualifies as PCC1, expressed in MWh, that the Generating Facility would have generated and delivered, but did not, on account of Force Majeure Event, Buyer Default, or Curtailment Order, which amount shall be equal to (a) the VER Forecast expressed in MWh, applicable to the Buyer Curtailment Period, or (b) if there is no VER Forecast available or Seller demonstrates to Buyer’s reasonable satisfaction that the VER Forecast does not represent an accurate forecast of generation from the Generating Facility, the amount determined by a third party reasonably acceptable to Buyer using an industry standard forecasting or back-casting methodology to determine the potential generation of the Generating Facility as a function of Available Generating Capacity, solar insolation and panel temperature, and using relevant Facility availability, weather, historical and other pertinent data for the period of time during the period in which the Force Majeure Event, Buyer Default, or Curtailment Order occurred.
Exhibit E - 1
EXHIBIT E
PROGRESS REPORTING FORM
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 written Progress Report in the form specified below.
Each Progress Report must include the following items:
1. Executive summary.
2. Facility description.
3. Site plan of the Facility.
4. Description of any planned changes to the Facility or the Site.
5. Gantt chart schedule showing progress on achieving each of the Milestones.
6. Summary of activities during the previous calendar quarter or month, as applicable, including any OSHA labor hour reports.
7. Forecast of activities scheduled for the current calendar quarter.
8. Written description about the progress relative to Seller’s Milestones, including whether Seller has met or is on target to meet the Milestones.
9. List of issues that could potentially affect Seller’s Milestones.
10. A status report of start-up activities including a forecast of activities ongoing and after start-up, a report on Facility performance including performance projections for the next twelve (12) months.
11. Progress and schedule of all agreements, contracts, 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.
14. Any other documentation reasonably requested by Buyer.
Exhibit F - 1
EXHIBIT F
Exhibit G1 - 1
EXHIBIT G-1
FORM OF COMMERCIAL OPERATION DATE CERTIFICATE
This certification (“Certification”) of Commercial Operation is delivered by _______[Licensed Professional Engineer] (“Engineer”) to Peninsula Clean Energy Authority (“Buyer”) in accordance with the terms of that certain Power Purchase and Sale 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.
Engineer hereby certifies and represents to Buyer the following:
(1) Seller has installed generating equipment with a nameplate capacity of no less than ninety-five percent (95%) of the Guaranteed PV Capacity. (2) Seller has installed and commissioned storage equipment with a capacity of at least ninety-five percent (95%) of the Guaranteed Storage Capacity in accordance with Exhibit N of the Agreement.
(3) The Storage Facility is capable of receiving Charging Energy from, and delivering Discharging Energy to, the Delivery Point and commissioning of equipment at the Storage Facility has been completed in accordance with the manufacturer’s specifications. (4) The Generating Facility’s testing included a performance test demonstrating peak electrical output of no less than ninety-five percent (95%) of the Guaranteed PV Capacity at the Delivery Point.
(5) Authorization to parallel the Facility was obtained by the Participating Transmission Owner, [Name of Participating Transmission Owner as appropriate] on___[DATE]____ (6) The Participating Transmission Owner or Distribution Provider has provided documentation supporting full unrestricted release for Commercial Operation by [Name of Participating Transmission Owner as appropriate] on _______[DATE]_____. (7) The CAISO has provided notification supporting the Facility’s Commercial Operation, inclusion in the Full Network Model and authorization to provide Ancillary Services from the Storage Facility, all in accordance with the CAISO tariff on _______[DATE]_____. (8) Seller has
(9) The total rated power of the Storage Facility inverters associated with the Installed Storage Capacity as measured to the Delivery Point is at least [____] MW charging and [____] MW discharging at 45°C ambient air temperature.
Exhibit G1 - 2
EXECUTED by [licensed professional engineer]
this ________ day of _____________, 20__.
[LICENSED PROFESSIONAL
ENGINEER]
By:
Its:
Date:
Exhibit G2 - 1
EXHIBIT G-2
FORM OF INSTALLED CAPACITY CERTIFICATE
This certification (“Certification”) of Installed Capacity is delivered by [Licensed Professional Engineer] (“Engineer”) to PENINSULA CLEAN ENERGY AUTHORITY (“Buyer”) in accordance with the terms of that certain Power Purchase and Sale Agreement dated __________ (“Agreement”) by and between [SELLER ENTITY] and Buyer. All capitalized terms used in this Certification but not otherwise defined herein shall have the respective meanings assigned to such terms in the Agreement.
The initial Generating Facility performance test under Seller’s engineering, procurement and construction contract or primary solar module supply agreement for the Generating Facility conducted on [Date] demonstrated peak Generating Facility electrical output of __MW AC at the Delivery Point, as adjusted for ambient conditions on the date of the performance test (“Installed PV Capacity”).
The Commercial Operation Storage Capacity Test conducted on [Date] demonstrated a maximum dependable operating capability to discharge electric energy of __ MW AC to the Delivery Point at four (4) hours of continuous discharge, in accordance with the testing procedures, requirements and protocols set forth in Section 4.13 and Exhibit N (“Installed Storage Capacity”).
EXECUTED by [LICENSED PROFESSIONAL ENGINEER]
this ________ day of _____________, 20__.
[LICENSED PROFESSIONAL
ENGINEER]
By:
Its:
Date:
Exhibit H - 1
EXHIBIT H
FORM OF CONSTRUCTION START DATE CERTIFICATE
This certification (“Certification”) of the Construction Start Date is delivered by [SELLER ENTITY] (“Seller”) to PENINSULA CLEAN ENERGY AUTHORITY (“Buyer”) in accordance with the terms of that certain Power Purchase and Sale 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. the engineering, procurement and construction contract related to the Facility was executed on __________;
2. the limited notice to proceed with the construction of the Facility was issued on ______________ (attached);
3. the Construction Start Date has occurred;
4. 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).
IN WITNESS WHEREOF, the undersigned has executed this Certification on behalf of Seller as of the ___ day of ________.
[SELLER ENTITY]
By:
Its:
Date:
EXHIBIT I
FORM OF LETTER OF CREDIT
[ISSUING BANK LETTERHEAD AND ADDRESS]
IRREVOCABLE STANDBY LETTER OF CREDIT NO. [XXXXXXX]
DATE:
BANK REF.:
AMOUNT: US$[XXXXXXX]
EXPIRY DATE:
BENEFICIARY:
PENINSULA CLEAN ENERGY
ADDRESS:
APPLICANT:
INTERSECT POWER, LLC
℅ IP DARDEN IV, LLC
9450 SW GEMINI DR, PMB #68743
BEAVERTON, OR 97008-7105
LADIES AND GENTLEMEN:
ON BEHALF OF [XXXXXXX] (“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 [XXXXXXX] (“BENEFICIARY”), ADDRESS__________, FOR AN AMOUNT NOT TO EXCEED THE AGGREGATE SUM OF U.S. $[XXXXXXX] (UNITED STATES DOLLARS AND 00/100),
PURSUANT TO THAT CERTAIN EXCLUSIVITY AGREEMENT DATED AS OF JUNE [XX], 2025(THE “AGREEMENT”) BETWEEN APPLICANT AND BENEFICIARY. THIS
LETTER OF CREDIT SHALL BECOME EFFECTIVE IMMEDIATELY AND SHALL HAVE AN INITIAL EXPIRY DATE OF __________ __, 202_ SUBJECT TO THE AUTOMATIC EXTENSION PROVISIONS HEREIN.
FUNDS UNDER THIS LETTER OF CREDIT ARE AVAILABLE TO YOU AGAINST YOUR
DRAFT(S) DRAWN ON US AT SIGHT IN STRICT COMPLIANCE WITH THE TERMS AND CONDITIONS OF THIS LETTER OF CREDIT ON OR BEFORE 5:00 P.M., NEW YORK
TIME, ON OR BEFORE THE EXPIRATION DATE, MENTIONING THEREON OUR LETTER OF CREDIT NO. [XXXXXXX] ACCOMPANIED BY YOUR DATED STATEMENT
PURPORTEDLY SIGNED BY YOUR DULY AUTHORIZED REPRESENTATIVE, IN THE
FORM ATTACHED HERETO AS EXHIBIT A, CONTAINING ONE OF THE TWO ALTERNATIVE PARAGRAPHS SET FORTH IN PARAGRAPH 2 THEREIN.
Exhibit I - 1
Exhibit I - 2
WE HEREBY AGREE WITH THE BENEFICIARY THAT ALL DRAFTS DRAWN UNDER
AND IN COMPLIANCE WITH THE TERMS OF THIS LETTER OF CREDIT WILL BE DULY
HONORED UPON PRESENTATION TO THE ISSUER IN PERSON, BY COURIER OR BY FAX AT [ADDRESS]. PAYMENT SHALL BE MADE BY ISSUER IN U.S. DOLLARS WITH ISSUER’S OWN IMMEDIATELY AVAILABLE FUNDS.
THE DOCUMENT(S) REQUIRED MAY ALSO BE PRESENTED BY FAX AT FACSIMILE NO. ON OR BEFORE THE EXPIRY DATE (AS MAY BE EXTENDED BELOW) ON THIS
LETTER OF CREDIT IN ACCORDANCE WITH THE TERMS AND CONDITIONS OF THIS LETTER OF CREDIT. FACSIMILE SHOULD BE CONFIRMED BY TELEPHONE TO [XXXXXXX]. IN THE CASE OF A DRAW IN THE FULL AMOUNT OF THIS LETTER OF
CREDIT, THE ORIGINAL THEREOF TO BE SENT THE SAME BUSINESS DAY BY OVERNIGHT COURIER TO THE ISSUER. IN THE EVENT A REQUEST IS PRESENTED
VIA FAX TO THE ISSUER, IT IS UNDERSTOOD AND AGREED THAT THE ISSUER MAY
ACT ON SUCH REQUEST WITHOUT THE NEED OR THE OBLIGATION TO SECURE THE ORIGINAL. IN ANY EVENT, THE ISSUER SHALL NOT BE LIABLE FOR ANY
DISCREPANCY THAT MAY ARISE BETWEEN THE REQUEST TRANSMITTED BY FAX AND THE ORIGINAL REQUEST DELIVERED AS PROVIDED HEREIN.
PARTIAL DRAWS ARE PERMITTED UNDER THIS LETTER OF CREDIT.
IT IS A CONDITION OF THIS LETTER OF CREDIT THAT IT SHALL BE DEEMED
AUTOMATICALLY EXTENDED WITHOUT AN AMENDMENT FOR A SUCCESSIVE ONE
YEAR PERIOD BEGINNING ON THE PRESENT EXPIRY DATE HEREOF AND UPON EACH ANNIVERSARY FOR SUCH DATE, UNLESS AT LEAST NINETY (90) DAYS PRIOR
TO ANY SUCH EXPIRY DATE WE HAVE SENT TO YOU WRITTEN NOTICE BY
OVERNIGHT COURIER SERVICE THAT WE ELECT NOT TO PERMIT THIS LETTER OF
CREDIT TO BE SO EXTENDED, IN WHICH CASE IT WILL EXPIRE ON ITS THEN CURRENT EXPIRY DATE. NO PRESENTATION MADE UNDER THIS LETTER OF CREDIT AFTER SUCH EXPIRY DATE WILL BE HONORED.
NOTWITHSTANDING ANY REFERENCE IN THIS LETTER OF CREDIT TO ANY OTHER
DOCUMENTS, INSTRUMENTS OR AGREEMENTS, THIS LETTER OF CREDIT
CONTAINS THE ENTIRE AGREEMENT BETWEEN BENEFICIARY AND ISSUER RELATING TO THE OBLIGATIONS OF ISSUER HEREUNDER.
THIS LETTER OF CREDIT IS SUBJECT TO THE UNIFORM CUSTOMS AND PRACTICE FOR DOCUMENTARY CREDITS (2007 REVISION) INTERNATIONAL CHAMBER OF COMMERCE PUBLICATION NO. 600 (THE “UCP”), EXCEPT TO THE EXTENT THAT THE
TERMS HEREOF ARE INCONSISTENT WITH THE PROVISIONS OF THE UCP, INCLUDING BUT NOT LIMITED TO 36 OF THE UCP, IN WHICH CASE THE TERMS OF THIS LETTER OF CREDIT SHALL GOVERN. IN THE EVENT OF AN ACT OF GOD, RIOT,
CIVIL COMMOTION, INSURRECTION, WAR OR ANY OTHER CAUSE BEYOND ISSUER’S CONTROL (AS DEFINED IN ARTICLE 36 OF THE UCP) THAT INTERRUPTS ISSUER’S BUSINESS AND CAUSES THE PLACE FOR PRESENTATION OF THE LETTER
OF CREDIT TO BE CLOSED FOR BUSINESS ON THE LAST DAY FOR PRESENTATION,
THE EXPIRY DATE OF THE LETTER OF CREDIT WILL BE AUTOMATICALLY Exhibit I - 3
EXTENDED WITHOUT AMENDMENT TO A DATE THIRTY (30) CALENDAR DAYS AFTER THE PLACE FOR PRESENTATION REOPENS FOR BUSINESS.
PLEASE ADDRESS ALL CORRESPONDENCE REGARDING THIS LETTER OF CREDIT
TO THE ATTENTION OF THE LETTER OF CREDIT DEPARTMENT AT BANCO SANTANDER, S.A., NEW YORK BRANCH 437 MADISON AVENUE, 6TH FLOOR, NEW YORK, NY 10022 ATTN: TRADE SERVICES, REFERRING SPECIFICALLY TO ISSUER’S LETTER OF CREDIT NO. [XXXXXXX]. FOR TELEPHONE ASSISTANCE, PLEASE CONTACT ISSUER’S STANDBY LETTER OF CREDIT DEPARTMENT AT 212 350-3671 AND HAVE THIS LETTER OF CREDIT AVAILABLE.
ALL COMMISSIONS, EXPENSES, AND CHARGES INCURRED WITH THIS LETTER OF CREDIT ARE FOR THE ACCOUNT OF THE APPLICANT.
VERY TRULY YOURS,
[INSERT BANK NAME]
_________________________________ _________________________________
AUTHORIZED SIGNATURE AUTHORIZED SIGNATURE
Original Confirmed by: _________________
Exhibit I - 4
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 [XXXXXXX], ADDRESS___________ AS BENEFICIARY (THE “BENEFICIARY”) OF THE IRREVOCABLE LETTER OF CREDIT NO. [XXXXXXX] (THE “LETTER OF CREDIT”) ISSUED BY BANCO SANTANDER, S.A., NEW YORK BRANCH (THE “BANK”) BY ORDER OF [XXXXXXX] (THE “APPLICANT”), HEREBY CERTIFIES TO THE BANK AS FOLLOWS:
1. APPLICANT AND BENEFICIARY ARE PARTY TO THAT CERTAIN AGREEMENT DATED AS OF [XXXXXXX] (THE “AGREEMENT”).
2. BENEFICIARY IS MAKING A DRAWING UNDER THIS LETTER OF CREDIT IN THE AMOUNT OF U.S. $___________.
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 THE BANK HAS
PROVIDED NOTICE OF ITS INTENT TO NOT EXTEND THE EXPIRY DATE OF
THE LETTER OF CREDIT AND APPLICANT FAILED TO PROVIDE ACCEPTABLE REPLACEMENT SECURITY TO BENEFICIARY AT LEAST THIRTY (30) DAYS PRIOR TO THE EXPIRY DATE OF THE LETTER OF CREDIT.
3. THE UNDERSIGNED IS A DULY AUTHORIZED REPRESENTATIVE OF [XXXXXXX] 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 [XXXXXXX] BY WIRE TRANSFER IN IMMEDIATELY AVAILABLE FUNDS TO THE FOLLOWING ACCOUNT:
[SPECIFY ACCOUNT INFORMATION]
[XXXXXXX]
_______________________________
NAME AND TITLE OF AUTHORIZED REPRESENTATIVE
Exhibit I - 5
DATE___________________________
Exhibit J - 1
EXHIBIT J
INSURANCE
Liability Insurance
To the fullest extent allowable by law, Seller shall purchase and maintain such insurance as will protect it from the claims set forth below which may arise out of or result from Seller’s operations under this Agreement whether such operations be by itself or by anyone directly or indirectly employed by them, or by anyone for whose acts any of them may be liable. Limits shall be all the Insurance Coverage and/or limits carried by or available to the Seller, the minimum limits as required herein.
General Conditions
Seller shall maintain completed operations liability insurance for the entire Contract Term plus the period of time Seller may be held legally liable for.
Seller shall maintain policies of insurance in full force and effect, at all times during the performance of the Agreement, plus any statute of repose or statute of limitations applicable to the jurisdiction where any work is performed.
All insurance companies shall have a Best’s rating of A-VII or better.
In addition, Seller shall provide Buyer with 45 days’ notice in case of cancellation or non- renewal, except 10 days for non-payment of premium.
Certificates of Insurance Acord Form 25 and all required Endorsements shall be filed with Buyer within (5) working days of execution of the contract and/or prior to commencement of any work performed.
Acceptance of the certificates or endorsements by the Buyer shall not constitute a waiver of Seller’s obligations hereunder.
If Seller fails to secure and/or pay the premiums for any of the policies of insurance required herein, or fails to maintain such insurance, Buyer may, in addition to any other rights it may have under this Agreement or at law or in equity, terminate this Agreement or secure such policies or policies of insurance for the account of Seller and charge Seller for the premiums paid therefore, or withhold the amount thereof from sums otherwise due from Buyer to Seller. Neither the Buyer’s rights to secure such policy or policies nor the securing thereof by Buyer shall constitute an undertaking by Buyer on behalf of or for the benefit of Seller or others to determine or warrant that such policies are in effect.
Seller shall be fully and financially responsible for all deductibles or self-insured retentions.
Exhibit J - 2
Coverage Forms & Limits
Seller’s Commercial General Liability insurance shall be written on an industry standard Commercial General Liability Occurrence from (CG 00 01, 12/07) or its equivalent and shall include but not be limited to products/completed operations; premises and operations; blanket contractual; advertising/personal injury; independent Buyers.
Coverage shall be on an occurrence form with policy limits of not less than:
• $1,000,000 Each Occurrence Bodily Injury & Property Damage • $1,000,000 Personal & Advertising Injury
• $2,000,000 General Aggregate to apply on a Per Project basis • $2,000,000 Products/Completed Operations Aggregate
Business Auto Liability – Coverage shall be no less than that provided by Insurance Services Office, Inc. (ISO) form CA 00 01, written on an occurrence basis to apply to “any auto” or at a minimum “all owned, hired and non-owned autos”, with policy limits of not less than $1,000,000 per accident for bodily injury and property damage.
If applicable, Broadened Pollution for Covered Autos shall apply. This requirement may also be satisfied by providing proof of separate Pollution Liability that includes coverage for transportation exposures.
Workers’ Compensation and (b) employers’ liability – Sellers shall provide coverage for industrial injury to their employees (or leased employees as applicable) in strict accordance with the provisions of the State or States in which project work is performed or where jurisdiction is deemed to be applicable. Workers’ Compensation shall be provided in a statutory form on either a state or, where applicable, federal (U.S. Longshore & Harbor Workers Act, Maritime- Jones Act, etc.) basis as required in the applicable jurisdiction.
Such insurance shall be in an amount of not less than:
• Workers Compensation: Statutory
• Employers Liability
o $1,000,000 Bodily Injury by Accident – Each Accident
o $1,000,000 Bodily Injury by Disease – Total Limit
o $1,000,000 Bodily Injury by Disease – Each Employee
Commercial Umbrella or Excess Liability Insurance over Seller’s primary Commercial General Liability, Business Auto Liability and Employers Liability. All coverage terms required under the Commercial General Liability, Business Auto Liability and Employers Liability above must be included on the Umbrella or Excess Liability Insurance.
Coverage shall be written on an occurrence form with policy limits not less than:
• $5,000,000 Each Occurrence
• $5,000,000 Personal & Advertising Injury
• $5,000,000 Aggregate (where applicable, following the terms of the underlying)
Exhibit J - 4
of defense costs by the insurer if the insurer initially pays defense costs but later determines the claims are not covered.
Buyer reserves the right, in its sole and subjective discretion, to reject any Additional Insured forms that are deemed not equivalent to what is required herein.
Waiver of Subrogation – Seller shall provide a Waiver of Subrogation Endorsement naming Buyer for all lines of coverage.
Additional Requirements
Property Insurance
Seller shall procure and maintain, at the Seller’s own expense, Builder’s Risk, property and equipment insurance, including for any property stored off the Site, in transit or any of the Buyer’s property in the care, custody or control of Seller. Seller and Seller’s insurance carrier(s) hereby waive all rights of subrogation against Buyer for damage including loss of use.
Buyer neither represents nor assumes responsibility for the adequacy of the Builder’s Risk Insurance to protect the interests of the Seller. It shall be the obligation of the Seller to purchase and maintain any supplementary property insurance that it deems necessary to protect its interest in the Work, including without limitation off site stored materials and materials in transit.
Seller is solely responsible for loss or damage to its personal property.
Exhibit K - 1
EXHIBIT K
FORM OF REPLACEMENT RA NOTICE
This Replacement RA Notice (this “Notice”) is delivered by [ ], a [ ] (“Seller”) to Peninsula Clean Energy Authority, a California joint powers authority (“Buyer”) in accordance with the terms of that certain Power Purchase and Sale Agreement dated [__________] (“Agreement”) by and between Seller and Buyer. All capitalized terms used in this Notice but not otherwise defined herein shall have the respective meanings assigned to such terms in the Agreement.
Pursuant to Section 3.9(b) of the Agreement, Seller hereby provides the below Replacement RA product information (to be repeated for each unit if more than one):
Name
Location
CAISO Resource ID
Unit SCID
Resource Type
Point of Interconnection with the CAISO Controlled
Grid (“substation or transmission line”)
Path 26 (North or South)
LCR Area (if any)
Deliverability restrictions, if any, as described in
most recent CAISO deliverability assessment
Run Hour Restrictions
Deliverability Period
Prorated Percentage of Unit Factor
Prorated Percentage of Unit Flexible Factor
Flexible Capacity Category (e.g., 1, 2, 3, or N/A)
Month Unit CAISO NQC
(MW)
Unit CAISO
EFC (MW)
Unit Contract
Quantity (MW)
Unit EFC Contract
Quantity (MW)
January
February
March
April
May
June
July
August
September
October
November
December
[SELLER]
Exhibit K - 2
By:
Its:
Date:
Whereas, the following definitions apply to the terms in the above Replacement RA product information:
“CPUC RA Filing Guide” means the Filing Guide for System, Local and Flexible Resource Adequacy (RA) Compliance Filings published annually by the CPUC. “Deliverability Period” means the period in which the unit has rights to deliver energy to the CAISO Grid.
“Flexible Capacity Category” means the category of Effective Flexible Capacity, as described in the CPUC RA Filing Guide, applicable to the unit.
“LCR Area (if any)” means the Local Capacity Requirement area, as used in the CPUC RA Filing Guide, applicable to the unit, if any.
“Prorated Percentage of Unit Factor” means the percentage of the Unit CAISO NQC that is designated as Unit Contract Quantity.
“Prorated Percentage of Unit Flexible Factor” means the percentage of Unit CAISO EFC that is designated as Unit EFC Contract Quantity.
“Resource Type” means the type of generating or storage resource. “Run Hour Restrictions” means any restrictions on the ability of the unit to run during any hours of the day.
“Unit CAISO EFC” means the unit’s Effective Flexible Capacity, as described in the CPUC RA Filing Guide, as determined by CPUC and CAISO.
“Unit CAISO NQC” means the NQC (as defined in the CAISO Tariff) for the unit, as determined by CPUC and CAISO.
“Unit Contract Quantity” means the amount of Resource Adequacy Benefits to be provided to Buyer from the unit in the form of Replacement RA, not to exceed the Guaranteed RA Capacity. “Unit EFC Contract Quantity” means the amount of Flexible Resource Adequacy Benefits to be provided to Buyer from the unit in the form of Replacement RA, not to exceed the Guaranteed RA Capacity.
Exhibit K - 3
“Unit SCID” means the unit’s “Scheduling Coordinator ID Code”, as defined in the CAISO Tariff.
Exhibit L1 - 1
EXHIBIT L-1
Annual Energy Forecast
The following table is provided for informational purposes only.
Please provide the expected PV Energy in Pacific Prevailing Time. For the Daylight Savings Day in March, the HE3 volume should be 0 MWh. For the Daylight Savings Day in November, the HE2 volume should represent two hours of generation.
Date Datetime (Hour
Beginning)
Hour Ending MWh
1/1/2022 1/1/2022 0:00 1
1/1/2022 1/1/2022 1:00 2
1/1/2022 1/1/2022 2:00 3
1/1/2022 1/1/2022 3:00 4
1/1/2022 1/1/2022 4:00 5
1/1/2022 1/1/2022 5:00 6
[insert additional rows] … …
12/31/2022 12/31/2022 18:00 19
12/31/2022 12/31/2022 19:00 20
12/31/2022 12/31/2022 20:00 21
12/31/2022 12/31/2022 21:00 22
12/31/2022 12/31/2022 22:00 23
12/31/2022 12/31/2022 23:00 24
Exhibit L2 - 1
EXHIBIT L-2
Monthly Expected Available Generating Capacity
The following table is provided for informational purposes only.
Please adjust the table for the appropriate number of days in the month for each month of the year.
Monthly Forecast of Available Generating Capacity (MW)
c 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 Day 1
Day 2
Day 3
Day 4
Day 5
[insert additional rows for each day of the month]
Day
26 Day
27 Day
28 Day
29**
Day
30**
Day
31**
Exhibit L2 - 2
*All times are designated as “Hour-Ending [__]”.
**Include these rows if needed for each month.
Exhibit L3 - 1
EXHIBIT L-3
Monthly Expected Available Storage Capacity
The following table is provided for informational purposes only.
Please adjust the table for the appropriate number of days in the month for each month of the year.
Monthly Expected Available Storage 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 Day 1
Day 2
Day 3
Day 4
Day 5
[insert additional rows for each day of the month]
Day 26
Day 27
Day 28
Day
29**
Day
30**
Day
31**
*All times are designated as “Hour-Ending [__]”.
Exhibit L3 - 1
**Include these rows if needed for each month.
Exhibit L3 - 1
EXHIBIT L-4
Monthly Expected PV Energy
The following table is provided for informational purposes only.
Please adjust the table for the appropriate number of days in the month for each month of the year.
Monthly Expected PV Energy (MWh)
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 Day 1
Day 2
Day 3
Day 4
Day 5
[insert additional rows for each day of the month]
Day 26
Day 27
Day 28
Day
29**
Day
30**
Day
31**
Exhibit L3 - 1
*All times are designated as “Hour-Ending [__]”.
**Include these rows if needed for each month.
Exhibit M - 1
EXHIBIT M
MONTHLY STORAGE AVAILABILITY
1. Monthly Storage Availability.
(a) For each monthly period after the Commercial Operation Date, Seller shall calculate the “Monthly Storage Availability” using the formula set forth below:
where:
CALCULATION INTERVAL or “C.I.” = each successive five-minute interval, but excluding all such intervals which are Scheduled Maintenance not to exceed MONTHLY UNAVAILABLE CALCULATION INTERVALS = the sum of
all Unavailable Calculation Intervals for the applicable Month UNAVAILABLE CALCULATION INTERVAL = For each Calculation Interval, the Unavailable Calculation Interval is defined using the formula set forth below. Except as otherwise expressly provided in this Agreement, the calculations of Available Storage Capacity and Available Storage Capability shall be based solely on the availability of the Storage Facility to receive Charging Energy from or deliver Discharging Energy to the Delivery Point, as applicable (excluding for reasons at the high-voltage side of the Delivery Point or beyond). Any Calculation Interval in which the Storage Facility fails to maintain connectivity to the CAISO such that it cannot receive ADS or AGC signals shall result in an Unavailable Calculation Interval of one (1) for that Calculation Interval 𝑼𝒏𝒂𝒗𝒂𝒊𝒍𝒂𝒃𝒍𝒆 𝑪𝒂𝒍𝒄𝒖𝒍𝒂𝒕𝒊𝒐𝒏 𝑰𝒏𝒕𝒆𝒓𝒗𝒂𝒍 ൌ 𝟏 െ 𝑡ℎ𝑒 𝑙𝑒𝑠𝑠𝑒𝑟 𝑜𝑓:
⎣
⎢
⎢
⎢
⎢
⎢
⎡ ൬ 𝐴
𝑆𝑡𝑜𝑟𝑎𝑔𝑒 𝐶𝑎𝑝𝑎𝑐𝑖𝑡𝑦൰ 𝑜𝑟
൬ 𝐴𝑣𝑎𝑖𝑙𝑎𝑏𝑙𝑒 𝑆𝑡𝑜𝑟𝑎𝑔𝑒 𝐶𝑎𝑝𝑎𝑏𝑖𝑙𝑖𝑡𝑦
𝑆𝑡𝑜𝑟𝑎𝑔𝑒 𝐶𝑎𝑝𝑎𝑐𝑖𝑡𝑦 𝑋 4 ℎ𝑟𝑠 ൰ 𝑜𝑟
൬1 െ 𝐹𝑎𝑖𝑙𝑢𝑟𝑒 𝑡𝑜 𝐶𝑜𝑚𝑝𝑙𝑦 𝐶𝑎𝑝𝑎𝑐𝑖𝑡𝑦
𝑆𝑡𝑜𝑟𝑎𝑔𝑒 𝐶𝑎𝑝𝑎𝑐𝑖𝑡𝑦 െ 𝐴𝑆 𝐹𝑎𝑖𝑙𝑢𝑟𝑒 𝑡𝑜 𝐶𝑜𝑚𝑝𝑙𝑦 𝐶𝑎𝑝𝑎𝑐𝑖𝑡𝑦
𝑆𝑡𝑜𝑟𝑎𝑔𝑒 𝐶𝑎𝑝𝑎𝑐𝑖𝑡𝑦 ൰
⎦
⎥
⎥
⎥
⎥
⎥
⎤
where:
Exhibit M - 2
“A” is the “AVAILABLE STORAGE CAPACITY”, which shall be calculated as the sum of the available capacity of each of the system inverters, in MW AC, from all system inverters expected to receive Charging Energy from or deliver Discharging Energy to the Delivery Point, in such Calculation Interval (based on normal operating conditions pursuant to the manufacturer’s guidelines), provided the Available Storage Capacity shall be the lower of such amounts reported by (i) Seller’s real-time EMS data feed to Buyer for the Storage Facility for such Calculation Interval, and (ii) Seller’s most recent Availability Notice (as updated pursuant to Section 4.4); provided further, if the Storage Facility fails, or is unable, to provide Ancillary Services for any reason (including by reason of failing an Ancillary Services certification test) that is not excused hereunder, then in accordance with Section 4.15, the Available Storage Capacity for such Calculation Interval shall be deemed reduced by an amount equal to the product of (a) the Available Storage Capacity multiplied by (b) and provided further, “A” shall never exceed the Storage Capacity. “AVAILABLE STORAGE CAPABILITY” = the sum of the following (taking into account the SOC at the time of calculation):
i. The battery capability (in MWh) available to receive Charging Energy from the Delivery Point in the applicable Calculation Interval ii. The battery capability (in MWh) available to deliver Discharging Energy to the Delivery Point in the applicable Calculation Interval In calculating Available Storage Capability, the “battery capability (in MWh) available to receive Charging Energy” and “battery capability (in MWh) available to deliver Discharging Energy” are calculated as the product of (1) the count of available system cells in such Calculation Interval, multiplied by (2) the capability, in MWh, expected from each such system cell (based on normal operating conditions pursuant to the manufacturer’s guidelines), that are able (considering the conditions of the Facility in total) to receive Charging Energy from or deliver Discharging Energy to the Delivery Point; provided, the Available Storage Capability shall be the lower of such amounts reported by (i) Seller’s real-time EMS data feed to Buyer for the Storage Facility for such Calculation Interval, and (ii) Seller’s most recent Availability Notice (as updated pursuant to Section 4.4); provided further, Available Storage Capability shall never exceed the Storage Capacity x four (4) hours.
“FAILURE TO COMPLY CAPACITY” = Any portion of the facility, in MW, which failed to comply with a valid Charging Notice or Discharging Notice that complies with this Agreement, including (i) any such failure to charge or discharge at the times, in the quantities, and at the levels specified in such Charging Notice or Discharging Notice; and (ii) any charge or discharge of the Facility other than pursuant to a valid Charging Notice or Discharging Notice that complies with this Agreement, or pursuant to a notice from the CAISO, any PTO, or any other Governmental Authority. Failure To Comply Capacity will be Exhibit M - 3
measured as the absolute value of the difference, in MW, between the average DOT communicated to the Facility by the CAISO for the Calculation Interval and the average metered energy flow for the Calculation Interval; provided, such calculation shall not include any energy related to Ancillary Services to the extent already captured in the calculation of AS Failure to Comply Capacity. “AS FAILURE TO COMPLY CAPACITY” = If any Calculation Interval results in a CAISO No Pay associated with failure to provide Ancillary Services in accordance with the AS Schedule from the CAISO, then the AS Failure to Comply Capacity shall equal the Ancillary Services capacity that Seller failed to provide, in MW. AS Failure to Comply Capacity will be zero to the extent such Failure to Comply is attributable to any actions or inactions of Buyer, the SC or the CAISO or resulting from Seller’s compliance with any Curtailment Order or other instruction or direction from a Governmental Authority or the PTO unless caused by Seller’s fault or negligence;
“TOTAL CALCULATION INTERVALS” = the total number of Calculation Intervals in the applicable month.
(b) If the total rated power of the Storage Facility inverters as measured to the Delivery Point at forty-five degrees (45°) C ambient air temperature is less than the Installed Storage Capacity, then Buyer shall have the right, in its reasonable discretion, to reduce the Available Storage Capacity by applying an ambient temperature derate to the applicable Calculation Interval.