Agenda packet — Silicon Valley Clean Energy Board of Directors, February 9, 2022 (part 1 of 2)

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Pursuant to the Americans with Disabilities Act, if you need special assistance in this meeting, please contact the Clerk for the Authority at (408) 721-5301 x1005. Notification 48 hours prior to the meeting will enable the Authority to make reasonable arrangements to ensure accessibility to this meeting. (28 CFR 35.105 ADA Title II).

Liz Gibbons, Chair
City of Campbell
George Tyson, Vice Chair
Town of Los Altos Hills
Jon Robert Willey
City of Cupertino
Zach Hilton
City of Gilroy
Neysa Fligor
City of Los Altos
Rob Rennie
Town of Los Gatos
Evelyn Chua
City of Milpitas
Javed Ellahie
City of Monte Sereno
Yvonne Martinez Beltran
City of Morgan Hill
Margaret Abe-Koga
City of Mountain View
Tina Walia
City of Saratoga
Larry Klein
City of Sunnyvale
Otto Lee
County of Santa Clara
svcleanenergy.org
333 W El Camino Real
Suite 330
Sunnyvale, CA 94087
Silicon Valley Clean Energy Authority
Board of Directors Meeting
Wednesday, February 9, 2022
7:00 pm
Teleconference Meeting
Webinar:
https://svcleanenergy-org.zoom.us/j/89588837313
Telephone (Audio Only):

US: +1 669 219 2599
Webinar ID: 895 8883 7313
This meeting will be conducted in accordance with California Government Code Section 54953(e), in consideration of the Coronavirus (COVID-19). All members of the Silicon Valley Clean Energy Board of Directors and staff will participate in this meeting by teleconference.

Members of the public may observe this meeting electronically by accessing the meeting via instructions above. Public Comments can be sent in advance of the meeting to Board Clerk Andrea Pizano at [email protected] and will be read within the public comment period or the applicable agenda item. The public will also have an opportunity to provide comments during the meeting. Members of the public using Zoom may comment during public comment or the applicable agenda item by using the Raise Hand feature and you will be recognized by the Chair. Those using the telephone (audio only) feature should press star 9 on your phones to initiate the “Raise Hand” function in Zoom. You will then be announced, unmuted, and your time to speak will begin.

The public may provide comments on any matter listed on the Agenda. Speakers are customarily limited to 3 minutes each, however, the Board Chair may increase or decrease the time allotted to each speaker based on the number of speakers, the length of the agenda and the complexity of the subject matter. Speaking time will not be decreased to less than one minute.

If you are an individual with a disability and need a reasonable modification or accommodation pursuant to the Americans with Disabilities Act (“ADA”) please contact Board Clerk Andrea Pizano at [email protected] prior to the meeting for assistance.

AGENDA
Call to Order

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Liz Gibbons, Chair
City of Campbell
George Tyson, Vice Chair
Town of Los Altos Hills
Jon Robert Willey
City of Cupertino
Zach Hilton
City of Gilroy
Neysa Fligor
City of Los Altos
Rob Rennie
Town of Los Gatos
Evelyn Chua
City of Milpitas
Javed Ellahie
City of Monte Sereno
Yvonne Martinez Beltran
City of Morgan Hill
Margaret Abe-Koga
City of Mountain View
Tina Walia
City of Saratoga
Larry Klein
City of Sunnyvale
Otto Lee
County of Santa Clara
svcleanenergy.org
333 W El Camino Real
Suite 330
Sunnyvale, CA 94087
Roll Call
Public Comment on Matters Not Listed on the Agenda
The public may provide comments on any matter not listed on the Agenda provided that it is within the subject matter jurisdiction of SVCE. Speakers are customarily limited to 3 minutes each, however, the Board Chair may increase or decrease the time allotted to each speaker based on the number of speakers, the length of the agenda and the complexity of the subject matter. Speaking time will not be decreased to less than one minute.

Consent Calendar (Action)
1a) Approve Minutes of the January 12, 2022, Board of Directors Meeting 1b) Receive December 2021 Treasurer Report
1c) Adopt Resolution Authorizing Public Meetings to Continue to Be Held Via Teleconferencing Pursuant to Government Code Section 54953(e) and Making Findings
1d) Adopt Resolution Modifying Delegation of Authority to the Chief Executive Officer to Negotiate Non-Standard Pricing Agreements for Eligible Large Commercial and Industrial Customers, to Include Customer-Provided Supply Agreements
1e) Approve 2022 Updates to Exhibit C, Annual Energy Use, and Exhibit D, Voting Shares, of the SVCE Joint Powers Agreement
1f) Approve Cancellation of July 13, 2022 Board of Directors Meeting and Receive 2022 Board of Directors Regular Meeting Schedule 1g) Authorize the Chief Executive Officer to Extend the Contract Terms and Spending Under Innovation Onramp Participant Agreement with UtilityAPI, Inc. for Data Hive
1h) Adopt Resolution Amending SVCE Conflict of Interest Code to Add Multiple Positions
1i) Executive Committee Report
1j) Finance and Administration Committee Report
1k) Audit Committee Report
1l) California Community Power Report
Regular Calendar
2) CEO Report (Discussion)
3) Appoint 2022 Board Committee Members (Action)

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Liz Gibbons, Chair
City of Campbell
George Tyson, Vice Chair
Town of Los Altos Hills
Jon Robert Willey
City of Cupertino
Zach Hilton
City of Gilroy
Neysa Fligor
City of Los Altos
Rob Rennie
Town of Los Gatos
Evelyn Chua
City of Milpitas
Javed Ellahie
City of Monte Sereno
Yvonne Martinez Beltran
City of Morgan Hill
Margaret Abe-Koga
City of Mountain View
Tina Walia
City of Saratoga
Larry Klein
City of Sunnyvale
Otto Lee
County of Santa Clara
svcleanenergy.org
333 W El Camino Real
Suite 330
Sunnyvale, CA 94087
4) Adopt Resolution to Implement SVCE Generation Rate Changes Effective March 2022 (Action)
5) Authorize the Chief Executive Officer to Execute Necessary Agreements for Tumbleweed Long Duration Energy Storage with California Community Power, Participating Community Choice Aggregators and LS Power’s Tumbleweed LLC (Action)
6) Clean Energy Procurement Informational Update (Presentation) Board Member Announcements and Direction on Future Agenda Items Adjourn

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Silicon Valley Clean Energy Revised: October 10, 2019
1 SVCE

GLOSSARY OF TERMS
CAISO – California Independent System Operator - a non-profit independent system operator that oversees the operation of the California bulk electric power system, transmission lines and electricity market generated and transmitted by its members (~80% of California’s electric flow). Its stated mission is to “operate the grid reliably and efficiently, provide fair and open transmission access, promote environmental stewardship and facilitate effective markets and promote infrastructure development. CAISO is regulated by FERC and governed by a five-member governing board appointed by the governor.

CALCCA – California Community Choice Association – Association made up of Community Choice Aggregation (CCA) groups which represents the interests of California’s community choice electricity providers.

CARB – California Air Resources Board – The CARB is charged with protecting the public from the harmful effects of air pollution and developing programs and actions to fight climate change in California.

CEC – California Energy Commission
CPUC – California Public Utility Commission
C&I – Commercial and Industrial – Business customers
CP – Compliance Period – Time period to become RPS compliant, set by the CPUC (California Public Utilities Commission)
DA – Direct Access – An option that allows eligible customers to purchase their electricity directly from third party providers known as Electric Service Providers (ESP).

DA Cap – the maximum amount of electric usage that may be allocated to Direct Access customers in California, or more specifically, within an Investor-Owned Utility service territory.

DA Lottery – a random drawing by which DA waitlist customers become eligible to enroll in DA service under the currently-applicable Direct Access Cap.

DA Waitlist – customers that have officially registered their interest in becoming a DA customer but are not yet able to enroll in service because of DA cap limitations.

DAC – Disadvantaged Community
DASR – Direct Access Service Request – Request submitted by C&I to become direct access eligible.

Demand - The rate at which electric energy is delivered to or by a system or part of a system, generally expressed in kilowatts (kW), megawatts (MW), or gigawatts (GW), at a given instant or averaged over any designated interval of time. Demand should not be confused with Load or Energy.

DER – Distributed Energy Resource – A small-scale physical or virtual asset (e.g. EV charger, smart thermostat, behind-the-meter solar/storage, energy efficiency) that operates locally and is connected to a larger power grid at the distribution level.

Distribution - The delivery of electricity to the retail customer’s home or business through low voltage distribution lines.

Silicon Valley Clean Energy Revised: October 10, 2019
2 DLAP – Default Load Aggregation Point – In the CAISO’s electricity optimization model, DLAP is the node at which all bids for demand should be submitted and settled. SVCE settles its CAISO load at the PG&E DLAP as SVCE is in the PG&E transmission access charge area.

DR – Demand Response - An opportunity for consumers to play a significant role in the operation of the electric grid by reducing or shifting their electricity usage during peak periods in response to time-based rates or other forms of financial incentives.

DWR – Department of Water Resources – DWR manages California’s water resources, systems, and infrastructure in a responsible, sustainable way.

ELCC – Effective Load Carrying Capacity – The additional load met by an incremental generator while maintaining the same level of system reliability. For solar and wind resources the ELCC is the amount of capacity which can be counted for Resource Adequacy purposes.

EPIC – Electric Program Investment Charge – The EPIC program was created by the CPUC to support investments in clean energy technologies that provide benefits to the electricity ratepayers of PG&E, San Diego Gas & Electric Company (SDG&E), and Southern California Edison Company (SCE) ERRA – Energy Resource Recovery Account – ERRA proceedings are used to determine fuel and purchased power costs which can be recovered in rates. The utilities do not earn a rate of return on these costs, and only recover actual costs. The costs are forecast for the year ahead. If the actual costs are lower than forecast, then the utility gives money back, and vice versa.

ESP – Energy Service Provider - An energy entity that provides service to a retail or end-use customer.

EV – Electric Vehicle
GHG – Greenhouse gas - water vapor, carbon dioxide, tropospheric ozone, nitrous oxide, methane, and chlorofluorocarbons (CFCs). A gas that causes the atmosphere to trap heat radiating from the earth. The most common GHG is Carbon Dioxide, though Methane and others have this effect as well.

GRC – General Rate Case – Proceedings used to address the costs of operating and maintaining the utility system and the allocation of those costs among customer classes. For California’s three large IOUs, the GRCs are parsed into two phases. Phase I of a GRC determines the total amount the utility is authorized to collect, while Phase II determines the share of the cost each customer class is responsible and the rate schedules for each class. Each large electric utility files a GRC application every three years for review by the Public Advocates Office and interested parties and approval by the CPUC.

GWh – Gigawatt-hour - The unit of energy equal to that expended in one hour at a rate of one billion watts. One GWh equals 1,000 megawatt-hours.

IEP – Independent Energy Producers – California’s oldest and leading nonprofit trade association, representing the interest of developers and operators of independent energy facilities and independent power marketers.

IOU – Investor Owned Utility – A private electricity and natural gas provider.

IRP – Integrated Resource Plan – A plan which outlines an electric utility’s resource needs in order to meet expected electricity demand long-term.
kW – Kilowatt – Measure of power where power (watts) = voltage (volts) x amperage (amps) and 1 kW = 1000 watts
kWh – Kilowatt-hour – This is a measure of consumption. It is the amount of electricity that is used over some period of time, typically a one-month period for billing purposes. Customers are charged a rate per kWh of electricity used.

Silicon Valley Clean Energy Revised: October 10, 2019
3 LCFS – Low Carbon Fuel Standard – A CARB program designed to encourage the use of cleaner low-carbon fuels in California, encourage the production of those fuels, and therefore, reduce greenhouse gas emissions.

LCR – Local (RA) Capacity Requirements – The amount of Resource Adequacy capacity required to be demonstrated in a specific location or zone.

LMP – Locational Marginal Price – Each generator unit and load pocket is assigned a node in the CAISO optimization model. The model will assign a LMP to the node in both the day- ahead and real time market as it balances the system using the least cost. The LMP is comprised of three components: the marginal cost of energy, congestion and losses. The LMP is used to financially settle transactions in the CAISO.

Load - An end use device or customer that receives power from an energy delivery system. Load should not be confused with Demand, which is the measure of power that a load receives or requires. See Demand.

LSE – Load-serving Entity – Entities that have been granted authority by state, local law or regulation to serve their own load directly through wholesale energy purchases and have chosen to exercise that authority.

NEM – Net Energy Metering – A program in which solar customers receive credit for excess electricity generated by solar panels.

NRDC – Natural Resources Defense Council
OIR – Order Instituting Rulemaking - A procedural document that is issued by the CPUC to start a formal proceeding. A draft OIR is issued for comment by interested parties and made final by vote of the five Commissioners of the CPUC.

MW – Megawatt – measure of power. A megawatt equals 1,000 kilowatts or 1 million watts.

MWH – Megawatt-hour – measure of energy
NP-15 – North Path 15 – NP-15 is a CAISO pricing zone usually used to approximate wholesale electricity prices in northern California in PG&E’s service territory.

PCC1 – RPS Portfolio Content Category 1 – Bundled renewables where the energy and REC are dynamically scheduled into a California Balancing Authority (CBA) such as the CAISO. Also known as “in-state” renewables PCC2 – RPS Portfolio Content Category 2 – Bundled renewables where the energy and REC are from out-of-state and not dynamically scheduled to a CBA.

PCC3 – RPS Portfolio Content Category 3 – Unbundled REC PCIA or “exit fee” - Power Charge Indifference Adjustment (PCIA) is an “exit fee” based on stranded costs of utility generation set by the California Public Utilities Commission. It is calculated annually and assessed to customers of CCAs and paid to the IOU that lost those customers as a result of the formation of a CCA.

PCL – Power Content Label – A user-friendly way of displaying information to California consumers about the energy resources used to generate the electricity they sell, as required by AB 162 (Statue of 2009) and Senate Bill 1305 (Statutes of 1997).

PD – Proposed Decision – A procedural document in a CPUC Rulemaking process that is formally commented on by Parties to the proceeding. A PD is a precursor to a final Decision voted on by the five Commissioners of the CPUC.

Pnode – Pricing Node – In the CAISO optimization model, it is a point where a physical injection or withdrawal of energy is modeled and for which a LMP is calculated.

Silicon Valley Clean Energy Revised: October 10, 2019
4 PPA – Power Purchase Agreement – A contract used to purchase the energy, capacity and attributes from a renewable resource project.

RA – Resource Adequacy - Under its Resource Adequacy (RA) program, the California Public Utilities Commission (CPUC) requires load-serving entities—both independently owned utilities and electric service providers—to demonstrate in both monthly and annual filings that they have purchased capacity commitments of no less than 115% of their peak loads.

RE – Renewable Energy - Energy from a source that is not depleted when used, such as wind or solar power.

REC - Renewable Energy Certificate - A REC is the property right to the environmental benefits associated with generating renewable electricity. For instance, homeowners who generate solar electricity are credited with 1 solar REC for every MWh of electricity they produce. Utilities obligated to fulfill an RPS requirement can purchase these RECs on the open market.

RPS - Renewable Portfolio Standard - Law that requires CA utilities and other load serving entities (including CCAs) to provide an escalating percentage of CA qualified renewable power (culminating at 33% by 2020) in their annual energy portfolio.

SCE – Southern California Edison
SDG&E – San Diego Gas & Electric
SGIP – Self-Generation Incentive Program – A program which provides incentives to support existing, new, and emerging distributed energy resources (storage, wind turbines, waste heat to power technologies, etc.) TCR EPS Protocol – The Climate Registry Electric Power Sector Protocol – Online tools and resources provided by The Climate Registry to assist organizations to measure, report, and reduce carbon emissions.

Time-of-Use (TOU) Rates — The pricing of delivered electricity based on the estimated cost of electricity during a particular time-block. Time-of-use rates are usually divided into three or four time-blocks per 24 hour period (on-peak, midpeak, off-peak and sometimes super off-peak) and by seasons of the year (summer and winter). Real time pricing differs from TOU rates in that it is based on actual (as opposed to forecasted) prices that may fluctuate many times a day and are weather sensitive, rather than varying with a fixed schedule.

TURN – The Utility Reform Network - A ratepayer advocacy group charged with ensuring that California IOUs implement just and reasonable rates.

Unbundled RECs - Renewable energy certificates that verify a purchase of a MWH unit of renewable power where the actual power and the certificate are “unbundled” and sold to different buyers.

VPP – Virtual Power Plant – A cloud-based network that leverages an aggregation of distributed energy resources (DERs) to shift energy demand or provide services to the grid. For example, thousands of EV chargers could charge at a slower speed and hundreds of home batteries could discharge to the grid during a demand peak to significantly reduce the procurement of traditional supply resources.

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Silicon Valley Clean Energy Authority
Board of Directors Meeting
Wednesday, January 12, 2022
7:00 pm
Pursuant to State of California Gov’t Code Section 54953 (e) the meeting was conducted via teleconference.

DRAFT MINUTES
All present Board members participated via teleconference.

Call to Order:

Chair Abe-Koga called the Regular Meeting to order at 7:01 p.m.

Roll Call

Present:

Margaret Abe-Koga (Chair), Mountain View
Liz Gibbons (Vice Chair), Campbell
Jon Robert Willey, Cupertino
Zachary Hilton, Gilroy
Neysa Fligor, Los Altos
George Tyson, Los Altos Hills
Rob Rennie, Los Gatos
Evelyn Chua, Milpitas
Javed Ellahie, Monte Sereno
Yvonne Martinez Beltran, Morgan Hill (arrived at 7:06 p.m.) Tina Walia, Saratoga
Larry Klein, Sunnyvale
Otto Lee, Santa Clara County

Absent:

None.

Chair Abe-Koga welcomed new Director Larry Klein and Alternate Director Otto Lee.

Public Comment on Matters Not Listed on the Agenda
Arnold de Leon commented he had not seen a position from SVCE on the proposed Net Energy Metering

3.0. CEO Girish Balachandran responded to de Leon; Chair Abe-Koga noted Director Martinez Beltran had joined the meeting.

Adopt Resolution Commending Margaret Abe-Koga for Her Dedicated Service as Chair of the Board of Directors in 2021
Vice Chair Gibbons introduced the item and recognized Chair Abe-Koga for her service as Chair of the Board for 2021.

Item 1a Draft Minutes of the Jan. 12, 2022 SVCE Board of Directors Meeting

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Board Members thanked Chair Abe-Koga for her leadership.

Vice Chair Gibbons opened public comment.

Bruce Karney, Chair of Carbon Free Mountain View, recognized Chair Abe-Koga and shared the support Carbon Free Mountain View received from Chair Abe-Koga as a member of the Mountain View City Council in approval to fund the set up of SVCE and support carbon free electricity.

Vice Chair Gibbons closed public comment.

MOTION: Vice Chair Gibbons moved, seconded by Director Walia to adopt Resolution 2022-01 Commending Margaret Abe-Koga for Her Dedicated Service as Chair of the Board of Directors in 2021.

The motion carried unanimously by verbal roll call vote.

Chair Abe-Koga expressed her heartfelt thanks to the Board of Directors, staff, and members of the public.

Consent Calendar
1a) Approve Minutes of the December 8, 2021, Board of Directors Meeting 1b) Receive November 2021 Treasurer Report
1c) Adopt Resolution Authorizing Public Meetings to Continue to Be Held Via Teleconferencing Pursuant to Government Code Section 54953(e) and Making Findings 1d) Appoint SCVE Treasurer/Auditor and Board Secretary for 2022 1e) Receive Q4 2021 Decarbonization Programs Update
1f) Executive Committee Report
1g) Finance and Administration Committee Report
1h) Audit Committee Report
1i) California Community Power Report
There were no requests from the Board to pull a Consent Calendar Item for discussion; there were no requests from the public to speak on any matter on the Consent Calendar.

MOTION: Vice Chair Gibbons moved; seconded by Director Martinez Beltran to approve the Consent Calendar, Items 1a through 1i.

The motion carried unanimously by verbal roll call vote.

Regular Calendar
2) CEO Report (Discussion)
CEO Balachandran introduced Peter Mustacich, Energy Services Lead, who provided brief welcome comments. CEO Balachandran provided updates on the following:
- Personnel update: The position of Manager of Public Sector Services was filled by Tony Eulo, who is expected to start mid-February;
- The staff all-hands in-person meeting originally scheduled for January 14, 2022 has been postponed to April due to the rise of Covid cases;
- SVCE’s first long-term contract, the Coso geothermal project, has come online January 1, 2022.

The Slate solar plus storage project is expected to come online in the coming days. The first project through CC Power will be coming to the SVCE Board of Directors for approval in February, and
- PG&E Rates will be discussed at the February Board of Directors meeting.

Item 1a Draft Minutes of the Jan. 12, 2022 SVCE Board of Directors Meeting

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Chair Abe-Koga opened Public Comment.

No speakers.

Chair Abe-Koga closed Public Comment.

Chair Abe-Koga welcomed Energy Services Lead Peter Mustacich. 3) Elect a Chair and Vice Chair of the SVCE Board of Directors for 2022 (Action) Board Clerk Andrea Pizano provided a brief staff report, noting letters of interest were received for the role of Chair from Director Liz Gibbons, and from Director George Tyson for Vice Chair.

Chair Abe-Koga opened Public Comment.

No speakers.

Chair Abe-Koga closed Public Comment.

Chair Abe-Koga inquired if there were any nominations from the floor for the position of Chair; there were none.

Vice Chair Gibbons spoke to her interest of serving as Chair of the Board of Directors for 2022.

MOTION: Director Ellahie moved; seconded by Director Walia to appoint Director Liz Gibbons as Chair of the SVCE Board of Directors for 2022.

The motion carried unanimously by verbal roll call vote.

Following the appointment of Chair, the virtual gavel was passed to newly appointed Chair Gibbons to preside over the remainder of the meeting.

Chair Gibbons noted interest for the position of Vice Chair was received from Director George Tyson, and opened the floor for additional nominations. There were no nominations from the floor.

MOTION: Director Fligor moved; seconded by Director Rennie to appoint Director George Tyson as Vice Chair of the SVCE Board of Directors for 2022.

Directors shared their support of Chair Gibbons’ new role as Chair and appointing Director Tyson as Vice Chair. Director Tyson thanked the Board of Directors for their support, and spoke to his interest for the position of Vice Chair.

The motion carried unanimously by verbal roll call vote. 4) Appoint Directors to the 2022 SVCE Executive Committee (Action) Board Clerk Pizano introduced the item and summarized the interest received from Directors on joining the 2022 Executive Committee.

Chair Gibbons opened Public Comment.

No speakers.

Chair Gibbons closed Public Comment.

Director Abe-Koga spoke to withdrawing her name for consideration for the committee to allow others an opportunity to join.

MOTION: Director Abe-Koga moved; seconded by Director Chua to appoint the following Directors to the 2022 Executive Committee:

Item 1a Draft Minutes of the Jan. 12, 2022 SVCE Board of Directors Meeting

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Director Yvonne Martinez Beltran
Director Javed Ellahie
Director Neysa Fligor
Director Liz Gibbons
Director George Tyson
The motion carried unanimously by verbal roll call vote. 5) Approve Policy Platform and Identify Focus Areas for the 2022 Legislative and Regulatory Ad Hoc Committee (Action)
Melicia Charles, Director of Regulatory and Legislative Policy, presented a PowerPoint presentation with a summary of staff’s request to approve the following: SVCE’s 2022 Policy Platform, creation of an Ad Hoc Committee of the Board to address legislative and regulatory responses to industry transition (“Leg/Reg Ad Hoc Committee), and approve the 2022 focus areas for the Leg/Reg Ad Hoc Committee.

Following the information presented by Director of Regulatory and Legislative Policy Charles on SVCE’s policy platform, Chair Gibbons opened public comment.

Chair Gibbons opened Public Comment.

Bruce Karney commented he reviewed the greenhouse gas emissions of Southern California Edison, San Diego Gas and Electric, and Southern California CCAs, and was shocked to discover that, with one exception, all of the Southern California CCAs emit more greenhouse gasses per kWh or MWh than the investor-owned utilities. Karney commented due to the increasing cost of clean, green power in the open market, many CCAs have found it difficult to continue to price under the investor-owned utility. Karney commented his belief the CPUC is subject to regulatory capture and there is danger of CPUC decisions that disadvantage CCAs like SVCE and advantage PG&E and other investor-owned utilities. Karney suggested board members pay close attention to regulatory and legislative issues that Director of Regulatory and Legislative Policy Charles mentions because he thinks there are serious risks in 2022.

Chair Gibbons closed Public Comment.

Director of Regulatory and Legislative Policy Charles proceeded with the presentation and information relating to the 2022 focus areas for the Leg/Reg Ad Hoc Committee.

Chair Gibbons opened Public Comment.

Arnold de Leon commented he was pleased to see the emphasis on decarbonization for the Leg/Reg Ad Hoc Committee, and suggested SVCE take a close look at the NEM 3.0 proposal. Mr. de Leon noted he agreed with Mr. Karney’s comment on the CPUC.

Chair Gibbons closed Public Comment.

Director Willey suggested the public speaker, Arnold de Leon, send his concerns regarding NEM 3.0 to staff; Chair Gibbons requested staff connect with Mr. de Leon. CEO Balachandran noted Mr. de Leon was in contact with Director of Regulatory and Legislative Policy Charles.

Chair Gibbons suggested for future consideration staff reword the 2022 Focus Area of “Expansion of Direct Access” to “Analyze the Potential Expansion of Direct Access”.

MOTION: Director Rennie moved; seconded by Director Ellahie to approve SVCE’s 2022 Policy Platform, the creation of the 2022 Leg/Reg Ad Hoc Committee, and the following six key focus areas for the 2022 Leg/Reg Ad Hoc Committee:

1. Expansion of Direct Access
Item 1a Draft Minutes of the Jan. 12, 2022 SVCE Board of Directors Meeting

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2. Reliability Planning and Procurement

3. Transparency and Accountability in Ratemaking

4. Public Safety Power Shutoffs & Wildfire Prevention and Cost Recovery

5. Affordability and Equity

6. Decarbonization
The motion carried unanimously by verbal roll call vote.

Board Member Announcements and Future Agenda Items
Chair Gibbons announced staff started meeting with member agencies regarding Reach Codes 2.0, and encouraged Directors to engage Alternates in these discussions.

Chair Gibbons noted she had several requests to attend Acterra’s Code Red for Humanity event on Friday, January 14, 2022; Chair Gibbons requested staff distribute the information on the event. Chair Gibbons mentioned the recent changes in representation based on new redistricting.

Chair Rennie added the City of Los Gatos and Monte Sereno has undergone representative changes as well, and confirmed the changes would become effective in the November 2022 elections.

Meeting Adjourned at 8:27 p.m.

ATTEST:
_____________________________
Andrea Pizano, Board Secretary
Item 1a Draft Minutes of the Jan. 12, 2022 SVCE Board of Directors Meeting 1 TREASURER REPORT
Fiscal Year to Date
As of December 31, 2021
(Preliminary & Unaudited)
Issue Date: February 9, 2022
Table of Contents
Page
Summary 2
Statement of Net Position 4
Statement of Revenues, Expenses & Changes in Net Position 5 Statement of Cash Flows 6-7
Actuals to Budget Report 8-10
Monthly Change in Net Position 11
Investments Report 12
Customer Accounts 13
Accounts Receivable Aging Report 14
Item 1b Draft Treasurer Report - Dec. 2021

SILICON VALLEY

CLEAN ENERGY
2 Financial Highlights for the month of December 2021:
> SVCE operations resulted in a change in net position for the month of negative $2.2 million and fiscal-year-to-date (FYTD) change in net position of negative $5.2 million. > Retail GWh sales for the month landed at budget.
> FYTD operating margin of negative $1.0 million or negative 2.1% is above budget expectations of a negative 19.9% operating margin for the fiscal year to date. > FYTD Power Supply costs are 14.4% below budget.
> SVCE is investing ~95% of available funds generating FYTD investment income of $0.06 million.

Change in Net Position Oct Nov Dec Jan Feb Mar Apr May June July Aug Sept Total Adopted
Budget
Actual 1,532 (4,526) (2,237) (5,231) 36,485
Power Supply Costs Oct Nov Dec Jan Feb Mar Apr May June July Aug Sept Total Adopted
Budget
Energy & REC's 11,938 15,483 13,478 40,899
Wholesale Sales (195) (15) - (210)
Capacity 2,890 2,207 2,324 7,421
CAISO Charges (1,301) 205 2,286 1,191
NEM Expense 3 152 (187) (31)
Charge/Credit (IST/Net Rev) 1,189 (125) 759 1,824
Net Power Costs 14,525 17,908 18,660 - - - - - - - - - 51,092 273,561 Other Oct Nov Dec Jan Feb Mar Apr May June July Aug Sept Total Adopted
Budget
Capital Expenditures 4 13 10 27 150
Energy Programs 68 123 116 307 7,334
Load Statistics - GWh Oct Nov Dec Jan Feb Mar Apr May June July Aug Sept Total Adopted
Budget
Retail Sales Actual 302 288 327 917
Retail Sales Budget 310 311 327 333 296 314 301 317 341 354 366 343 3,914 3,914 * The financial results in this report are preliminary and subject to change pending closing of the books for the fiscal year. Any potential changes are not expected to be significant.

Financial Statement Highlights* ($ in 000's)

SILICON VALLEY CLEAN ENERGY AUTHORITY
Item 1b Draft Treasurer Report - Dec. 2021
3 Working Capital $165,615,364
Current Ratio 7.0
Operating Margin -2.1%
Expense Coverage Days 185
Long-Term Debt $0
Total Accounts 275,015
Opt-Out Accounts (Month) 25
Opt-Out Accounts (FYTD) 89
Opt-Up Accounts (Month) 194
Opt-Up Accounts (FYTD) 207
Other Statistics and Ratios
Item 1b Draft Treasurer Report - Dec. 2021
Retail Sales - Month Retail Sales - YTD

25.0 80.0 21.3 68.5

17.9 I I

20.0 17.2 60.0 50.0
cj 15.0
|10.0
S
I |40.0
'
1 20.0 5.0

0.0 0.0
Actual Budget FY20/21 Actual Budget FY20/21
Controllable O&M - Month Controllable O&M - YTD

25.0 22.4 65.3 70.0

20.2 55.3 18.9 60.0 53.7 20.0

50.0 S 15.0 C
o 40.0
i30.0 I
I

10.0 5

20.0 5.0 10.0

0.0 0.0
FY20 Actual Budget FY20/21 Actual Budget /21
4 Current Assets
Cash & Cash Equivalents $ 160,167,424
Accounts Receivable, net of allowance 20,062,384
Accrued Revenue 10,216,725
Other Receivables 6,659
Prepaid Expenses 2,258,522
Deposits 728,108
Restricted cash 4,001,539
Total Current Assets 197,441,361
Noncurrent assets
Capital assets, net of depreciation 320,624
Deposits 45,330
Total Noncurrent Assets 365,954
Total Assets 197,807,315
Current Liabilities
Accounts Payable 805,390
Accrued Cost of Electricity 25,501,163
Other accrued liabilities 688,224
User Taxes and Energy Surcharges due to other gov'ts 829,681 Total Current Liabilities 27,824,458
Noncurrent Liabilities
Supplier security deposits 9,131,250
Total noncurrent liabilities 9,131,250
Total Liabilities 36,955,708
Net investment in capital assets 320,624
Restricted for security collateral 4,001,539
Unrestricted (deficit) 156,529,444
Total Net Position $ 160,851,607

NET POSITION

SILICON VALLEY CLEAN ENERGY AUTHORITY

STATEMENT OF NET POSITION
As of December 31, 2021
ASSETS

LIABILITIES
Item 1b Draft Treasurer Report - Dec. 2021
5 OPERATING REVENUES
Electricity Sales, Net $ 49,802,516
GreenPrime electricity premium 237,111
Other income 4,500
TOTAL OPERATING REVENUES 50,044,127

OPERATING EXPENSES
Cost of Electricity 51,092,512
Contract services 2,176,834
Staff compensation and benefits 1,507,326
General & Administrative 496,711
Depreciation 23,225
TOTAL OPERATING EXPENSES 55,296,608
OPERATING INCOME(LOSS) (5,252,481)

NONOPERATING REVENUES (EXPENSES)
Interest Income 56,297
Financing costs (34,695)
TOTAL NONOPERATING REVENUES (EXPENSES) 21,602
CHANGE IN NET POSITION (5,230,879)
Net Position at beginning of period 166,082,486
Net Position at end of period $160,851,607

SILICON VALLEY CLEAN ENERGY AUTHORITY

STATEMENT OF REVENUES, EXPENSES
October 1, 2021 through December 31, 2021

AND CHANGES IN NET POSITION
Item 1b Draft Treasurer Report - Dec. 2021
6 OPERATING REVENUES
Electricity Sales, Net $ 49,802,516
GreenPrime electricity premium 237,111
Other income 4,500
TOTAL OPERATING REVENUES 50,044,127

SILICON VALLEY CLEAN ENERGY AUTHORITY

STATEMENT OF REVENUES, EXPENSES
October 1, 2021 through December 31, 2021

AND CHANGES IN NET POSITION
Item 1b Draft Treasurer Report - Dec. 2021
7 Operating Income (loss) $ (5,252,481)
Adjustments to reconcile operating income to net cash
provided (used) by operating activities
Depreciation expense 23,225
(Increase) decrease in net accounts receivable 5,927,800 (Increase) decrease in energy settlements receivable 269,012 (Increase) decrease in other receivables 223,826
(Increase) decrease in accrued revenue 4,193,895
(Increase) decrease in prepaid expenses 119,714
(Increase) decrease in current deposits (2,025)
Increase (decrease) in accounts payable (739,999)
Increase (decrease) in accrued cost of electricity (7,893,296) Increase (decrease) in accrued liabilities 46,181
Increase (decrease) in energy settlements payable 2,567,368 Increase (decrease) in taxes and surcharges due to other governments (225,354) Increase (decrease) in supplier security deposits 2,100,000 Net cash provided (used) by operating activities $ 1,357,866

RECONCILIATION OF OPERATING INCOME (LOSS) TO NET

CASH PROVIDED (USED) BY OPERATING ACTIVITIES

SILICON VALLEY CLEAN ENERGY AUTHORITY
STATEMENT OF CASH FLOWS (Continued)
October 1, 2021 through December 31, 2021
Item 1b Draft Treasurer Report - Dec. 2021
8 FYTD FYTD FY 2020-21 FY 2020-21
OPERATING REVENUES Actual Adopted Budget $ % Adopted Budget Remaining Budget Energy Sales $49,802,516 $49,675,003 $127,513 0% $338,603,000 $288,800,484 Green Prime Premium 237,111 113,882 123,229 108% 470,000 232,889 TOTAL OPERATING REVENUES 50,039,627 49,788,885 250,742 1% 339,073,000 289,033,373

ENERGY EXPENSES
Power Supply 51,092,512 59,717,562 (8,625,050) -14.4% 273,561,000 222,468,488 Operating Margin (1,052,885) (9,928,677) 8,875,792 -89% 65,512,000

OPERATING EXPENSES
Data Management 790,381 812,353 (21,972) -3% 3,249,000 2,458,619 PG&E Fees 298,363 362,486 (64,123) -18% 1,450,000 1,151,637 Salaries & Benefits 1,507,326 2,317,780 (810,454) -35% 9,271,000 7,763,674 Professional Services 663,257 1,394,997 (731,740) -52% 5,648,000 4,984,743 Marketing & Promotions 143,732 236,489 (92,757) -39% 919,000 775,268 Notifications 50,835 32,813 18,022 55% 131,000 80,165
Lease 121,991 131,250 (9,259) -7% 525,000 403,009
General & Administrative 295,762 303,266 (7,504) -2% 1,213,000 917,238 TOTAL OPERATING EXPENSES 3,871,647 5,591,434 (1,719,787) -31% 22,406,000 18,534,353 OPERATING INCOME/(LOSS) (4,924,532) (15,520,111) 10,595,579 -68% 43,106,000 48,030,532

NON-OPERATING REVENUES
Other Income 4,500 12,500 (8,000) -64% 50,000 45,500
Investment Income 56,297 75,000 (18,703) -25% 300,000 243,703 TOTAL NON-OPERATING REVENUES 60,797 87,500 (26,703) -31% 350,000 289,203

NON-OPERATING EXPENSES
Financing 34,695 10,000 24,695 247% 40,000 5,305

CAPITAL EXPENDITURES, TRANSFERS,
& OTHER
Capital Outlay 27,174 112,500 (85,326) -76% 150,000 122,826 Transfer to Programs Fund 344,705 344,705 - 0% 6,781,000 6,436,295 TOTAL OTHER USES 371,879 457,205 (85,326) -19% 6,931,000 6,559,121

NET INCREASE(DECREASE) IN AVAILABLE
FUND BALANCE -$5,270,309 -$15,899,816 $10,629,507 -67% $36,485,000 Variance

SILICON VALLEY CLEAN ENERGY AUTHORITY

BUDGETARY COMPARISON SCHEDULE
October 1, 2021 through December 31, 2021
Item 1b Draft Treasurer Report - Dec. 2021
9 ADOPTED ACTUAL/

ADOPTED BUDGET ADOPTED
REVENUE & OTHER SOURCES: BUDGET ACTUAL REMAINING BUDGET Transfer from Operating Fund $ 6,781,000 $ 344,705 $ 6,436,295 5% EXPENDITURES & OTHER USES:

Program expenditures 7,333,950 306,526 7,027,424 4.2%
Net increase (decrease) in fund balance $ (552,950) $38,179 Fund balance at beginning of period 5,837,711
Fund balance at end of period $5,875,890

ADOPTED ACTUAL/

ADOPTED BUDGET ADOPTED
REVENUE & OTHER SOURCES: BUDGET ACTUAL REMAINING BUDGET Transfer from Operating Fund * $ - $ - $ -
EXPENDITURES & OTHER USES:

Program expenditures * 3,000,000 2,698 2,997,302 0.1%
Net increase (decrease) in fund balance $ (3,000,000) (2,698) Fund balance at beginning of period 7,990,315
Fund balance at end of period $7,987,617

SILICON VALLEY CLEAN ENERGY AUTHORITY

BUDGETARY COMPARISON SCHEDULE
October 1, 2021 through December 31, 2021

CUSTOMER RELIEF & COMMUNITY RESILIENCY FUND

PROGRAM FUND

BUDGETARY COMPARISON SCHEDULE
October 1, 2021 through December 31, 2021
Item 1b Draft Treasurer Report - Dec. 2021
10 Net Increase (decrease) in available fund balance
per budgetary comparison schedule $ (5,270,309)
Adjustments needed to reconcile to the changes
in net position in the Statement of Revenues,
Expenses and Changes in Net Position
Subtract depreciation expense (23,225)
Subract program expense not in operating budget (306,526) Subract CRCR expense not in operating budget (2,698)
Add back transfer to Program fund 344,705
Add back capital asset acquisition 27,174
Change in Net Position (5,230,879)

SILICON VALLEY CLEAN ENERGY AUTHORITY

BUDGET RECONCILIATION TO STATEMENT OF

REVENUES, EXPENSES AND CHANGES IN NET POSITION
October 1, 2021 through December 31, 2021

OPERATING FUND
Item 1b Draft Treasurer Report - Dec. 2021
11 October November December January February March April May June July August September YTD

OPERATING REVENUES
Electricity sales, net $ 17,365,080 $ 14,621,707 $ 17,815,729 $ 49,802,516 Green electricity premium 80,961 $ 60,556 $ 95,594 237,111 Other Income 1,000 $ 2,500 $ 1,000 4,500
Total operating revenues 17,447,041 14,684,763 17,912,323 - - - - - - - - - 50,044,127

OPERATING EXPENSES
Cost of electricity 14,524,607 17,907,845 18,660,060 51,092,512 Staff compensation and benefits 448,844 465,162 593,320 1,507,326 Data manager 263,759 263,759 262,863 790,381
Service fees - PG&E 97,254 96,768 104,341 298,363
Consultants and other professional fees 370,413 341,404 376,273 1,088,090 General and administration 209,985 134,289 152,437 496,711 Depreciation 7,289 8,162 7,774 23,225
Total operating expenses 15,922,151 19,217,389 20,157,068 - - - - - - - - - 55,296,608 Operating income (loss) 1,524,890 (4,532,626) (2,244,745) - - - - - - - - - (5,252,481)

NONOPERATING REVENUES (EXPENSES)
Interest income 18,545 18,382 19,370 56,297
Financing costs (11,042) (11,626) (12,027) (34,695)
Total nonoperating revenues (expenses) 7,503 6,756 7,343 - - - - - - - - - 21,602 CHANGE IN NET POSITION $ 1,532,393 $ (4,525,870) $ (2,237,402) $ - $ - $ - $ - $ - $ - $ - $ - $ - $ (5,230,879)

SILICON VALLEY CLEAN ENERGY AUTHORITY

STATEMENT OF REVENUES, EXPENSES

AND CHANGES IN NET POSITION
October 1, 2021 through December 31, 2021
Item 1b Draft Treasurer Report - Dec. 2021
12 YTD
Return on Investments Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Total $18,545 $18,382 $19,370 $0 $0 $0 $0 $0 $0 $0 $0 $0 $56,297 Portfolio Invested
Average daily portfolio available to invest* 152,976,979 155,897,345 155,743,105 Average daily portfolio invested 141,994,910 145,456,026 148,530,962 % of average daily portfolio invested 92.8% 93.3% 95.4% Detail of Portfolio
Opening
Rate
December
Rate
Carrying
Value
Interest
Earned
Money Market - River City Bank 1.26% 0.15% $144,258,952 $18,924 * Note: Balance available to invest does not include lockbox or debt service reserve funds. -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

SILICON VALLEY CLEAN ENERGY AUTHORITY

INVESTMENTS SUMMARY
October 1, 2021 through December 31, 2021
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- Item 1b Draft Treasurer Report - Dec. 2021
13 CUSTOMER ACCOUNTS
Item 1b Draft Treasurer Report - Dec. 2021

RESIDENTIAL ACCOUNTS
300
-D
S 246.9 247.2 247.4
250m
3 O
jE 200
150
100
50 Oct Nov Dec Jan Feb Mar Apr May
lActual —Budget
Jun Jul Aug Sep

NON-RESIDENTIAL ACCOUNTS
Actual Budget
14 SILICON VALLEY CLEAN ENERGY AUTHORITY

ACCOUNTS RECEIVABLE AGING REPORT
October November December January February March April May June July August September 0 to 30 days 74.6% 66.6% 67.7%
31 to 60 days 8.3% 11.6% 9.1%
61 to 90 days 3.1% 3.7% 5.1%
91 to 120 days 2.0% 2.9% 3.0%
Over 120 days 12.0% 15.1% 15.0%

TOTAL DUE
Bad Debt % (Budget)
1%
Accounts Receivable Days
26 Days
$24,255,921
Item 1b Draft Treasurer Report - Dec. 2021

AGE SUMMARY
$18,000,000
$16,428,678
$16,000,000
$14,000,000
$12,000,000
$10,000,000
$8,000,000
$6,000,000
$3,641,708 $4,000,000
$2,214,698
$2,000,000 $1,247,143
$723,694
$0
<30 days <60 days <90 days <120 days Older

Page 1 of 2 ends

Staff Report – Item 1c
Item 1c: Adopt Resolution Authorizing Public Meetings to Continue to Be Held Via Teleconferencing Pursuant to Government Code Section 54953(e) and Making Findings
From: Trisha Ortiz, Assistant General Counsel
Prepared by: Trisha Ortiz, Assistant General Counsel
Date: 2/9/2022

RECOMMENDATION
To continue meetings to be held via teleconferencing pursuant to Government Code Section 54953(e), adopt the attached Resolution 2022-03 making the findings required by Section 54953(e)(3).

BACKGROUND
Pursuant to Government Code Section 54953(b)(3) legislative bodies may meet by “teleconference” only if the agenda lists each location a member remotely accesses a meeting from, the agenda is posted at all remote locations, and the public may access any of the remote locations. Additionally, a quorum of the legislative body must be within the legislative body’s jurisdiction.

Due to the COVID-19 pandemic, the Governor issued Executive Order N-29-20, suspending certain sections of the Brown Act. Pursuant to the Executive Order, legislative bodies no longer needed to list the location of each remote attendee, post agendas at each remote location, or allow the public to access each location. Further, a quorum of the legislative body does not need to be within the legislative body’s jurisdiction. After several extensions, Executive Order N-29-20 expired on September 30, 2021.

On September 16, 2021 Governor Newsom signed AB 361, new legislation that amends the Brown Act to allow local agencies to meet remotely during Governor declared emergencies under certain conditions. AB 361 authorizes local agencies to continue meeting remotely without following the Brown Act’s standard teleconferencing provisions if the meeting is held during a state of emergency proclaimed by the Governor and either of the following applies: (1) state or local officials have imposed or recommended measures to promote social distancing; or (2) the agency has already determined or is determining whether, as a result of the emergency, meeting in person would present imminent risks to the health or safety of attendees.

Due to the rise in COVID-19 cases caused by the Delta Variant, on September 21, 2021, the Santa Clara County Health Officer issued a recommendation that public bodies meet remotely due to the increased protection provided by social distancing. The Health Officer cited “unique characteristics” of government meetings that lead to increased risk of transmission, including the gathering of people from across communities, the need for everybody to participate (including those who are immunocompromised or unvaccinated), and difficulty ensuring compliance with vaccination and safety recommendations. In addition, the Health Officer has described the new Omicron variant as significantly more transmissible than prior variants of the virus.

On October 13, 2021, the Board adopted its Resolution 2021-23 to authorize public meetings to be held via teleconferencing pursuant to Government Code section 54953(e).

Within thirty days after the first teleconferenced meeting held under AB 361, and every thirty days thereafter, in order to continue meeting by teleconference, the local agency’s legislative body must find that it has Item 1c

SILICON VALLEY

CLEAN ENERGY
Agenda Item: 1c Agenda Date: 2/9/2022

Page 2 of 2 ends

reconsidered the circumstances of the state of emergency and that either: (1) The state of emergency continues to directly impact the ability of the members to meet safely in person; or (2) State or local officials continue to impose or recommend measures to promote social distancing.

On November 10, 2021, December 8, 2021, and January 12, 2022, the Board adopted Resolutions 2021-26, 2021-27, and 2022-02 authorizing public meetings to continue to be held via teleconferencing pursuant to Government Code Section 54953(e) and directing staff to return with a resolution to make the findings necessary to continue meeting pursuant to Government Code section 54953(e).

STRATEGIC PLAN
SVCE’s Board-adopted Strategic Plan identifies engaging the public as a goal of SVCE and remote meetings will better engage the public as long as COVID-19 is a threat to public health.

FISCAL IMPACT
Continuing to conduct remote public Board of Directors and Standing Committee meetings will not increase the cost of meetings.

ANALYSIS & DISCUSSION
The attached Resolution makes the periodic findings necessary to continue holding meetings under Government Code Section 54953(3). Specifically, the attached Resolution makes findings that the Board has reconsidered the circumstances of the COVID-19 state of emergency and that local officials continue to recommend measures to promote social distancing. As required by Government Code Section 54953(e)(3), the resolution makes the findings and provides that the findings will cover the period of time until the next regular meeting of the Board.

The resolution applies to both the Board of Directors and its Committees.

Staff will continue to monitor the situation and will return to the Board every 30 days or as needed with additional recommendations related to the conduct of public meetings.

ATTACHMENTS

1. Resolution 2022-03 Reconsidering Circumstances Of The COVID-19 State Of Emergency And Making Findings In Connection Therewith To Authorize Public Meetings To Be Held Via Teleconferencing Pursuant To Government Code Section 54953(e)
Item 1c
1 RESOLUTION 2022-02

SILICON VALLEY CLEAN ENERGY AUTHORITY
RESOLUTION NO. 2022-03

A RESOLUTION OF THE BOARD OF DIRECTORS OF THE SILICON

VALLEY CLEAN ENERGY AUTHORITY RECONSIDERING
CIRCUMSTANCES OF THE COVID-19 STATE OF EMERGENCY

AND MAKING FINDINGS IN CONNECTION THEREWITH TO

AUTHORIZE PUBLIC MEETINGS TO BE HELD VIA

TELECONFERENCING PURSUANT TO GOVERNMENT CODE
SECTION 54953(e)
WHEREAS, the Silicon Valley Clean Energy Authority (“Authority”) was formed on March 31, 2016 pursuant to a Joint Powers Agreement to study, promote, develop, conduct, operate, and manage energy programs in Santa Clara County; and WHEREAS, the Board of Directors (“the Board”) of Silicon Valley Clean Energy (“SVCE”) is committed to public access and participation in its meetings while balancing the need to conduct public meetings in a manner that reduces the likelihood of exposure to COVID-19; and
WHEREAS, all meetings of the Board of Directors and the other legislative bodies of SVCE are open and public, as required by the Ralph M. Brown Act (Cal. Gov.

Code 54950 – 54963), so that any member of the public may attend, participate, and watch the Board and other legislative bodies conduct their business; and WHEREAS, pursuant to Assembly Bill 361 legislative bodies of local agencies may hold public meetings via teleconferencing pursuant to Government Code Section 54953(e), without complying with the requirements of Government Code Section 54953(b)(3), if the legislative body complies with certain enumerated requirements in any of the following circumstances:

1. The legislative body holds a meeting during a proclaimed state of emergency, and state or local officials have imposed or recommended measures to promote social distancing.

2. The legislative body holds a meeting during a proclaimed state of emergency for the purpose of determining, by majority vote, whether as a result of the emergency, meeting in person would present imminent risks to the health or safety of attendees.

3. The legislative body holds a meeting during a proclaimed state of emergency and has determined, by majority vote, that, as a result of the emergency, meeting in person would present imminent risks to the health or safety of attendees; and WHEREAS, on March 4, 2020, Governor Newsom declared a State of Item 1c
Attachment 1
2 RESOLUTION 2022-02
Emergency in response to the COVID-19 pandemic (the “Emergency”) which remains in effect; and
WHEREAS, the Santa Clara Public Health Officer recommends that public bodies meet remotely to the extent possible, specifically including use of newly enacted AB 361.

WHEREAS, due to the ongoing COVID-19 pandemic and the need to promote social distancing to reduce the likelihood of exposure to COVID-19, the Board determined that meetings of the SVCE legislative bodies may be held via teleconferencing pursuant to Government Code Section 54953(e).

WHEREAS, to continue meeting pursuant to Government Code Section 54953(e), an agency must make periodic findings that: (1) the body has reconsidered the circumstances of the declared emergency; and (2) that any of the following circumstances exist: (a) the state of emergency continues to directly impact the ability of the members to meet safely in person, or (b) state or local officials continue to impose or recommend measures to promote social distancing.

NOW THEREFORE, the Board of Directors of the Silicon Valley Clean Energy Authority does hereby resolve, determine, and order as follows:

Section 1. The Recitals provided above are true and correct and are hereby incorporated by reference.

Section 2. The Board has reconsidered the circumstances of the COVID-19 state of emergency and local officials continue to recommend measures to promote social distancing.

Section 3. The Board and other legislative bodies of SVCE may continue to conduct their meetings pursuant to Government Code section 54953(e).

Section 4. Staff is hereby authorized and directed to take all actions necessary to carry out the intent and purpose of this Resolution. Such action includes returning to the Board within 30 days and every 30 days thereafter to make the findings required by Section 54953(e)(3).

Section 5. This Resolution shall take effect immediately upon its adoption.

PASSED AND ADOPTED this 9th day of February 2022, by the following vote:

JURISDICTION NAME AYE NO ABSTAIN ABSENT
City of Campbell Director Gibbons
City of Cupertino Director Willey
City of Gilroy Director Hilton
City of Los Altos Director Fligor
Item 1c
Attachment 1
3 RESOLUTION 2022-02
Town of Los Altos Hills Director Tyson
Town of Los Gatos Director Rennie
City of Milpitas Director Chua
City of Monte Sereno Director Ellahie
City of Morgan Hill Director Martinez Beltran
City of Mountain View Director Abe-Koga
County of Santa Clara Director Lee
City of Saratoga Director Walia
City of Sunnyvale Director Klein

Chair
ATTEST:

Andrea Pizano, Board Clerk
Item 1c
Attachment 1

Page 1 of 3 ends

Staff Report – Item 1d
Item 1d: Adopt Resolution Modifying Delegation of Authority to the Chief Executive Officer to Negotiate Non-Standard Pricing Agreements for Eligible Large Commercial and Industrial Customers, to Include Customer-Provided Supply Agreements From: Girish Balachandran, CEO
Prepared by: Don Bray, Director of Account Services and Community Relations Date: 2/9/2022

RECOMMENDATION
Staff recommends that the Board adopt Resolution No. 2022-04 modifying delegation of authority to the Chief Executive Officer (“CEO”) to negotiate and execute non-standard pricing agreements originally established in Resolution No. 2019-12, to include approval of supply agreements originated and furnished by the customer for the purpose of directly serving that customer’s load under a non-standard pricing agreement.

BACKGROUND
Large commercial and industrial (“C&I”) customers represent approximately one-third of SVCE’s overall load.

Accordingly, losing large C&I customers to Direct Access (“DA”) means measurable load loss for SVCE. Large C&I customers are critical partners in helping SVCE achieve its primary goals:
• Reducing local GHG emissions through use of clean, carbon-free electricity, in line with member agency climate goals
• Maintaining a strong financial foundation and competitive electricity prices • Enabling ongoing GHG reduction via electrification of transportation and the built environment, per SVCE’s Decarbonization Strategy and Programs Roadmap
• Enabling re-investment in the local community
In 2018, Senate Bill 237 re-opened DA for C&I customers, expanding the statewide ‘cap’ on DA by 4,000 GWh annually. Historically, many large PG&E or CCA customers have been on a waitlist to become DA customers, as associated energy pricing structures are typically lower-cost and more flexible. The waitlist included many of SVCE’s C&I customers, with annualized loads totaling more than 600 GWh, or ~15% of SVCE’s overall load.

Until this expansion of the DA cap, the DA program was fully subscribed and not open to new customers.

In 2019, as a direct result of the DA expansion, SVCE passed Resolution No. 2019-12, allowing SVCE to negotiate non-standard pricing agreements with qualifying large commercial and industrial customers, subject to a defined ‘Non-Standard Pricing Agreement Policy’. Under this Policy, non-standard pricing agreements must:
• Meet defined eligibility criteria, and be available to all customers meeting criteria • Be cost-based and account for any volume and/or price risk • Be priced to allow SVCE to cover variable costs and achieve some level of contribution to fixed cost and reserve margin, in conformance with SVCE’s financial objectives, Risk Management Policy and controls.
• Require a commitment level from the customer commensurate with non-standard pricing agreement • Meet SVCE’s carbon-free requirements
The Board delegated authority to the CEO to negotiate non-standard pricing agreements with the oversight of the Risk Oversight Committee. Delegation of authority in establishing Non-Standard Pricing Agreements is Item 1d

SILICON VALLEY

CLEAN ENERGY
Agenda Item: 1d Agenda Date: 2/9/2022

Page 2 of 3 ends

important because of the competitive need for responsiveness, and protection of customer-sensitive information.

ANALYSIS & DISCUSSION
Since 2018, the re-opening and expansion of DA under Senate Bill 237 resulted in SVCE load loss of approximately 60-80 GWh, or 1.5 – 2% of SVCE’s overall load. Most of this load loss has been from ‘national accounts’ with remote headquarters, and multiple retail locations or operating sites in SVCE territory. Senate Bill 237 also required that the CPUC study further expansion of the DA market through ongoing increases in the cap, and make recommendations back to the state legislature. The study, finalized in 2021, recommended against immediate expansion of the cap.

Nonetheless, it is anticipated that DA proponents will work to advance new legislation to increase the DA cap in future years.

SVCE understands that electricity costs are significant for our largest C&I customers, and historically, customers have saved money via the DA market. The DA marketplace is highly competitive, offering more flexible or lower-cost pricing structures than offered by traditional load-serving entities. Several of SVCE’s largest C&I customers currently also have some percentage of their load with DA providers in our service territory.

With qualifying customers, SVCE has continued to explore potential non-standard pricing agreements taking several possible forms, including but not limited to:
1) expanded discount relative to the standard SVCE tariff in exchange for a multi-year customer volume commitment
2) providing a discount in the form of co-investment in designated products or services consistent with SVCE’s decarbonization strategy (e.g. EV charging infrastructure, load capacity, resiliency) 3) providing a customer with generation services from specific renewable energy PPA’s, originated by SVCE and/or the customer
4) fixed or index-based pricing structures for a defined term and volume Current SVCE policy requires BOD approval of supply agreements for power (energy and environmental products) exceeding 5 years. In the case 3) above, SVCE may procure power originated and furnished by the customer, for the direct purpose of providing that power to the same customer under a non-standard pricing agreement. In this specific case, staff recommends modifying the CEO’s authority for non-standard pricing agreements to include approval of embedded customer-provided supply agreements. Supply or pricing risk is minimized, as the supply agreement for customer-provided power is tied to an SVCE retail service agreement to provide that power back to the same customer. Also, this modification supports the competitive need for responsiveness, and protection of customer-sensitive information.

This modification of policy would apply only to agreements for customer-provided power under a non-standard pricing agreement. BOD approval of any SVCE-originated PPAs is still required. Further, all non-standard pricing agreements must continue to meet SVCE’s Non-Standard Pricing Policy and be executed with oversight from SVCE’s Risk Oversight Committee. The Non-Standard Pricing Agreements, including any associated SVCE procurement of supply resources originated and furnished by the Customer to serve that Customer’s load, will be reviewed and approved as to form by SVCE counsel.

STRATEGIC PLAN
Approval of the attached Resolution and Non-Standard Pricing Agreement Policy is in direct support of the Board approved Strategic Plan as follows:
• Goal 12: Enact competitive service offerings and programs that deliver measurable environmental and economic benefits
Item 1d
Agenda Item: 1d Agenda Date: 2/9/2022

Page 3 of 3 ends

o Measure 2: Develop customized power offerings for strategic C&I customers • Goal 6: Manage and optimize power supply resources to meet affordability, GHG reduction and reliability objectives
o Measure 1: Manage power supply portfolio and energy risk Item 1d

ALTERNATIVE
The alternative would be no change in delegation of authority to the CEO for non-standard pricing agreements and continuing to require BOD approval of customer-provided supply agreements longer than five years embedded in a non-standard pricing agreement. This limits SVCE’s ability to respond in a competitive and confidential fashion to certain major customers considering Direct Access or other alternatives to SVCE-supplied power.

FISCAL IMPACT
There is no direct cost associated with this modification of delegation of authority.

ATTACHMENTS

1. Resolution 2022-04, Modifying Authority of the Chief Executive Officer to Negotiate Non-Standard Pricing Agreements for Eligible Large Commercial and Industrial Customers

2. Resolution 2019-12, Resolution of the Board of Directors of the Silicon Valley Clean Energy Authority Delegating Authority to the Chief Executive Officer to Negotiate Non-Standard Pricing Agreements for Eligible Large Commercial and Industrial Customers

3. Non-standard Pricing Agreement Policy, approved June 2019 Resolution 2022-04

SILICON VALLEY CLEAN ENERGY AUTHORITY
RESOLUTION NO. 2022-04

A RESOLUTION OF THE BOARD OF DIRECTORS OF THE SILICON VALLEY CLEAN

ENERGY AUTHORITY MODIFYING THE DELEGATION OF AUTHORITY TO THE CHIEF

EXECUTIVE OFFICER TO NEGOTIATE AND EXECUTE NON-STANDARD PRICING

AGREEMENTS WITH ELIGIBLE LARGE COMMERCIAL AND INDUSTRIAL CUSTOMERS,

TO INCLUDE APPROVAL OF SUPPLY AGREEMENTS FOR SUPPLY ORIGINATED AND

FURNISHED BY THE CUSTOMER FOR THE PURPOSE OF DIRECTLY SERVING THAT CUSTOMER’S LOAD UNDER A NON-STANDARD PRICING AGREEMENT

THE BOARD OF DIRECTORS OF THE SILICON VALLEY CLEAN ENERGY AUTHORITY HEREBY RESOLVES AS FOLLOWS:

WHEREAS, the Silicon Valley Clean Energy Authority (“SVCE”) was formed on March 31, 2016, pursuant to a Joint Powers Agreement to promote, develop, conduct, operate, and manage energy programs in Santa Clara County;
WHEREAS, Silicon Valley Clean Energy launched service under a community choice aggregation program on April 3, 2017;
WHEREAS, commercial and industrial customers make up a substantial majority of SVCE’s electric load;
WHEREAS, commercial and industrial customers are critical partners in helping SVCE and its member agencies reduce carbon emissions and meet climate action planning goals; WHEREAS, the state of California adopted new legislation to re-open the cap for Direct Access to the wholesale markets for commercial and industrial customers under SB 237 in September 2018;
WHEREAS, in the expanded Direct Access marketplace, current SVCE commercial and industrial customers may opt out to receive DA service under more flexible or lower-cost tariff structures;
WHEREAS, SVCE seeks to provide clean, carbon-free electricity services that meet customer needs, at rates that are competitive and contribute positively to SVCE’s financial position;
WHEREAS, the Direct Access marketplace is highly competitive, requiring that SVCE structure non-standard pricing agreement terms in a highly responsive, time-sensitive fashion; WHEREAS, in order to expedite the approval of non-standard pricing agreements consistent with Direct Access marketplace requirements, the Board adopted Resolution No. 2019- 12 in June 2019 to delegate to the Chief Executive Officer the authority to negotiate directly with eligible commercial and industrial accounts in accordance with the Board approved Non-Standard Pricing Agreement Policy (the “Current Policy”);
WHEREAS, Board of Director approval is required for procurement agreements for power supply (e.g. energy, environmental products) serving SVCE’s customer load, where the agreement is longer than 5 years;
Item 1d
Attachment 1
Resolution 2022-04
WHEREAS, SVCE wishes to offer Non-Standard Pricing Agreements that include SVCE procurement of supply resources originated and furnished by the Customer, for the purpose of directly serving that Customer’s load under a Non-Standard Pricing Agreement by revising the Current Policy to delegate to the Chief Executive Officer the authority to negotiate and enter into such agreements;

NOW, THEREFORE, THE BOARD OF DIRECTORS OF THE SILICON VALLEY CLEAN

ENERGY AUTHORITY DOES HEREBY RESOLVE, DETERMINE, AND ORDER AS FOLLOWS:

Section 1. The Board hereby modifies the Current Policy as follows: (i) delegation of authority to the Chief Executive Officer to negotiate and execute non-standard pricing agreements with an eligible large commercial or industrial customer (“Customer”), shall include authority to approve such agreements that include supply originated and furnished by the Customer for the purpose of directly serving that Customer’s load under a Non-Standard Pricing Agreement; and (ii) such agreements shall be reviewed and approved as to form by SVCE counsel.

PASSED AND ADOPTED this 9th day of February 2022, by the following vote:

JURISDICTION NAME AYE NO ABSTAIN ABSENT
City of Campbell Director Gibbons
City of Cupertino Director Willey
City of Gilroy Director Hilton
City of Los Altos Director Fligor
Town of Los Altos Hills Director Tyson
Town of Los Gatos Director Rennie
City of Milpitas Director Chua
City of Monte Sereno Director Ellahie
City of Morgan Hill Director Martinez Beltran
City of Mountain View Director Abe-Koga
County of Santa Clara Director Lee
City of Saratoga Director Walia
City of Sunnyvale Director Klein

Chair
ATTEST:

Andrea Pizano, Board Clerk
Item 1d
Attachment 1
Item 1d
Attachment 3

SILICON VALLEY CLEAN ENERGY AUTHORITY
RESOLUTION NO. 2019-12

A RESOLUTION OF THE BOARD OF DIRECTORS OF THE SILICON VALLEY CLEAN ENERGY

AUTHORITY DELEGATING AUTHORITY TO THE CHIEF EXECUTIVE OFFICER TO NEGOTIATE

NON-STANDARD PRICING AGREEMENTS FOR ELIGIBLE LARGE COMMERCIAL AND

INDUSTRIAL CUSTOMERS

THE BOARD OF DIRECTORS OF THE SILICON VALLEY CLEAN ENERGY AUTHORITY HEREBY RESOLVES AS FOLLOWS:

WHEREAS, the Silicon Valley Clean Energy Authority (“SVCE”) was formed on March 31, 2016, pursuant to a Joint Powers Agreement to promote, develop, conduct, operate, and manage energy programs in Santa Clara County;
WHEREAS, Silicon Valley Clean Energy launched service under a community choice aggregation program on April 3, 2017;
WHEREAS, commercial and industrial customers make up a substantial majority of SVCE’s electric load;
WHEREAS, commercial and industrial customers are critical partners in helping SVCE and its member agencies reduce carbon emissions and meet climate action planning goals; WHEREAS, the state of California adopted new legislation to re-open the cap for Direct Access to the wholesale markets for commercial and industrial customers under SB 237 in September 2018; WHEREAS, in the expanded Direct Access marketplace, current SVCE commercial and industrial customers may opt out to receive DA service under more flexible or lower-cost tariff structures; WHEREAS, SVCE seeks to provide clean, carbon-free electricity services that meet customer needs, at rates that are competitive and contribute positively to SVCE’s financial position; WHEREAS, the Direct Access marketplace is highly competitive, requiring that SVCE structure non-standard pricing agreement terms in a highly responsive, time-sensitive fashion; WHEREAS, SVCE wishes to offer non-standard pricing agreements to retain eligible commercial and industrial accounts, under the terms of the attached ‘Non-Standard Pricing Agreement Policy’ WHEREAS, in order to expedite the approval of non-standard pricing agreements consistent with Direct Access marketplace requirements, the Board wishes to delegate to the Chief Executive Officer the authority to negotiate directly with eligible commercial and industrial accounts in accordance with the Board approved Non-Standard Pricing Agreement Policy.

NOW, THEREFORE, THE BOARD OF DIRECTORS OF THE SILICON VALLEY CLEAN ENERGY AUTHORITY DOES HEREBY RESOLVE, DETERMINE, AND ORDER AS FOLLOWS:

Section 1. The Board hereby delegates authority to the Chief Executive Officer to negotiate and execute non-standard pricing agreements with eligible large commercial and industrial customers, provided that the pricing agreements meet the minimum requirements set forth in the Non-Standard Pricing Agreement Policy.

Resolution 2019-12
Item 1d
Attachment 3
PASSED AND ADOPTED this 12th day of June 2019, by the following vote:

JURISDICTION NAME AYE NO ABSTAIN ABSENT
City of Campbell Director Gibbons
City of Cupertino Director Sinks
City of Gilroy Director Tovar
City of Los Altos Alternate Director Fligor 'v
Town of Los Altos Hills Director Corrigan
Town of Los Gatos Director Sayoc
City of Milpitas Director Nunez
City of Monte Sereno Director Javed Ellahie
City of Morgan Hill Director Martinez Beltran
City of Mountain View Director Abe-Koga
County of Santa Clara Director Ellenberg
City of Saratoga Director Miller
City of Sunnyvale Director Smith
v/
ATTEST:
mJ/U
Andrea Pizano, Board Secretai
Resolution 2019-12

SILICON VALLEY CLEAN ENERGY AUTHORITY

NON-STANDARD PRICING AGREEMENT POLICY
When offering non-standard pricing agreements to eligible customers, SVCE adheres to a defined non-standard pricing agreement policy. A non-standard pricing agreement will apply to electric generation services, and if applicable, may include consideration and valuation of supporting products or services.

Under this policy, the non-standard pricing agreement must:
1) apply exclusively to customers with annual load in SVCE’s service territory greater than 10GWh 2) be marginal cost-based and account for any volume and/or price risk 3) be priced to allow SVCE to cover variable costs and achieve some level of contribution to fixed cost and reserve margin, in conformance with SVCE’s financial objectives, Risk Management Policy and controls.
4) require a commitment level from the customer (e.g. volume, length of term) commensurate with the non-standard pricing agreement offered to the customer
5) meet SVCE’s carbon-free requirements, and be consistent with SVCE’s decarbonization strategy for power supply, transportation and the built environment
Item 1d
Attachment 3

Page 1 of 1 ends

Staff Report – Item 1e
Item 1e: Approve 2022 Updates to Exhibit C, Annual Energy Use, and Exhibit D, Voting Shares, of the SVCE Joint Powers Agreement
From: Girish Balachandran, CEO
Prepared by: Don Bray, Director of Account Services and Community Relations Peyton Parks, Energy Services Lead
Hannah Gustafson, Sr. Energy Services Specialist
Date: 2/9/2022

RECOMMENDATION
Approve update to Exhibits C & D in Silicon Valley Clean Energy’s (SVCE) Joint Powers Agreement (JPA) to reflect the member agencies’ energy demand and voting rights.

BACKGROUND
As referenced in Section 4.9.2 Voting Shares Vote of SVCE’s JPA, immediately following an affirmative percentage vote by the Board of Directors, two Directors may request a vote of the voting shares be held. A voting shares vote requires that the sum of all corresponding voting shares of Directors voting in the affirmative exceed a 50 percent majority. Voting shares are determined by the formula outlined in Section

4.9.3 Voting Shares Formula.

The Annual Energy Use (Exhibit C) and Voting Shares (Exhibit D) for each of SVCE’s 13 jurisdictions should be adjusted in SVCE’s JPA annually.

ANALYSIS & DISCUSSION
The Voting Shares Formula outlined in Section 4.9.3 specifies that for the first two years following the Effective Date (March 31, 2016) voting shares are based on annual electricity usage within the Party’s respective jurisdiction. Electricity usage combines quantities of electricity served to customers by SVCE, and by PG&E. Direct Access load is not included in this calculation. For annual Voting Shares calculations after the first two years, Section 4.9.3 specifies that the calculation be based on electric load served by the Authority only.

All Jurisdictions in SVCE territory received service for an entire calendar year in 2021. Each Party’s 2022 voting share was calculated as a percentage of total 2021 load served by SVCE only.

ATTACHMENTS

1. Update to Exhibit C, Annual Energy Use

2. Update to Exhibit D, Voting Shares
Item 1e

SILICON VALLEY

CLEAN ENERGY
Exhibit C

Page 1 ends

EXHIBIT C

ANNUAL ENERGY USE
This Exhibit C is effective as of February 9, 2022.

Party kWh (2021*)
Campbell 183,921,521
Cupertino 200,723,619
Gilroy 222,069,595
Los Altos 115,868,549
Los Altos Hills 40,344,474
Los Gatos 169,578,308
Milpitas 577,186,354
Monte Sereno 15,230,783
Morgan Hill 202,621,844
Mountain View 457,964,351
Santa Clara County 345,776,076
(Unincorporated)
Saratoga 112,218,897
Sunnyvale 1,043,674,527
_____________
Total 3,687,178,898
*Data provided by Pacific Gas and Electric Company
Item 1e
Attachment 1
Exhibit D

Page 1 ends

EXHIBIT D

VOTING SHARES
This Exhibit D is effective as of February 9, 2022.

Party kWh (2021*) Voting Share
Section 4.9.2
Campbell 183,921,521 5.0%
Cupertino 200,723,619 5.4%
Gilroy 222,069,595 6.0%
Los Altos 115,868,549 3.2%
Los Altos Hills 40,344,474 1.1%
Los Gatos 169,578,308 4.6%
Milpitas 577,186,354 15.7%
Monte Sereno 15,230,783 0.4%
Morgan Hill 202,621,844 5.5%
Mountain View 457,964,351 12.4%
Santa Clara County 345,776,076 9.4%
(Unincorporated)
Saratoga 112,218,897 3.0%
Sunnyvale 1,043,674,527 28.3%
Total 3,687,178,898 100.0%
*Data provided by Pacific Gas and Electric Company
Item 1e
Attachment 2

Page 1 of 1 ends

Staff Report – Item 1f
Item 1f: Approve Cancellation of July 13, 2022 Board of Directors Meeting and Receive 2022 Board of Directors Regular Meeting Schedule
From: Girish Balachandran, CEO
Prepared by: Andrea Pizano, Board Clerk/Executive Assistant Date: 2/9/2022

RECOMMENDATION
Staff recommends that the Board approve the cancellation of the regularly scheduled July 13, 2022 Board of Directors Meeting and receive the 2022 Board of Directors regular meeting schedule.

EXECUTIVE COMMITTEE RECOMMENDATION
The Executive Committee met January 28, 2022 and were unanimous in recommending the cancellation of the July Board of Directors meeting.

BACKGROUND
Since 2018, the Board of Directors approved a one-month summer hiatus from meetings; in 2018 it was August, and, based on feedback from the Board that a July recess would be preferable, it was July in 2019, 2020, and 2021.

ANALYSIS & DISCUSSION
Given the positive feedback received for a summer recess, staff would like to propose this be continued. Staff suggests July be selected for the summer hiatus, as this has worked well in the past.

Being that the July Executive Committee meeting received approval to be cancelled, the month of July will not have any regularly scheduled SVCE committee meetings.

If the need for Board or any committee action arises in July, a special meeting of the Board and/or committee will be called.

STRATEGIC PLAN
Not applicable.

ALTERNATIVES
The Board may select an alternative month for a summer hiatus; the Board could also choose not to cancel the regularly scheduled July meeting.

FISCAL IMPACT
None.

ATTACHMENT

1. Proposed 2022 SVCE Board of Directors Regular Meeting Schedule Item 1f

SILICON VALLEY

CLEAN ENERGY
Updated: 1/31/22
2022 Board Meeting Schedule
All Board of Directors meetings occur at 7:00 p.m. and will be held virtually unless noted otherwise on the SVCE website
January 12, 2022
February 9, 2022
March 9, 2022
April 13, 2022
May 11, 2022
June 8, 2022
August 10, 2022
September 14, 2022
October 12, 2022
November 9, 2022
December 14, 2022
Item 1f
Attachment 1

SILICON VALLEY

CLEAN ENERGY

Page 1 of 2 ends

Staff Report – Item 1g
Item 1g: Authorize the Chief Executive Officer to Extend the Contract Terms and Spending Under Innovation Onramp Participant Agreement with UtilityAPI, Inc. for Data Hive From: Girish Balachandran, CEO
Prepared by: Rebecca Fang, Data Analyst
Date: 2/9/2022

RECOMMENDATION
Staff recommends that the Silicon Valley Clean Energy Authority Board (“SVCE Board”) authorize the Chief Executive Officer (“CEO”) to extend the contract terms with UtilityAPI, Inc. (“UAPI”) for hosting, maintaining and supporting the Innovation Onramp Data Hive pilot by adding $18,000 to the total cost of the pilot (from the currently authorized $379,500 to a not-to-exceed amount of $397,500) and extending the termination date from February 15, 2022 to April 15, 2022.

BACKGROUND
In December 2018, the SVCE Board adopted the Decarbonization Strategy and Programs Roadmap (abbv. “Roadmap”) to achieve its mission to reduce dependence on fossil fuels by providing carbon-free, affordable, and reliable electricity and innovative programs for the community. The Roadmap budget includes funding for the Innovation Onramp program, which is designed to leverage our unique position to engage and support the innovation ecosystem in addressing key market barriers to achieving deep decarbonization in SVCE service territory and beyond. In June 2019, the SVCE Board approved grant funding for a flagship pilot which had been proposed by UAPI. This pilot, later named “Data Hive”, has deployed a data exchange platform for SVCE service territory that allows third parties to request and download customer utility bill and usage data.

ANALYSIS & DISCUSSION
The Data Hive opened for public use in March 2020 with the goal of demonstrating the potential of free, authorized access to standardized and automated energy usage data in accelerating the deployment of clean energy projects, empowering customer choice and supporting local businesses. Interest in the Data Hive was high at launch and throughout the summer, with 60 3rd-party registrations in the first several months. Today, there are over 180 companies registered to use the Data Hive.

Transactional activity on the Data Hive for the spring and summer of 2020 remained fairly low – extending lockdowns and worsening economic conditions seemed to affect consumer interest in clean energy projects (see reference for solar installers1). As the pilot approached its original termination date of mid-September 2020, staff and UAPI implemented a no-cost term extension with a usage-based monthly fee to give the clean energy market more time to recover and use Data Hive.
1 See recent Solar Energy Industries Association (SEIA) report on solar installations:
https://www.seia.org/researchresources/solar-market-insight-report-2020-q4 Item 1g

SILICON VALLEY

CLEAN ENERGY
Agenda Item: 1g Agenda Date: 2/9/2022

Page 2 of 2 ends

In Q3 of 2020, the market for clean energy projects began to show some recovery2 and usage of the Data Hive increased. Additionally, SVCE’s other programs (e.g. GridShift: EV Charging pilot and FutureFit Assist: EV Charging) began to use the Data Hive to help our 3rd party administrators easily access customer data.

In February 2021, the pilot term was extended to November 15, 2021 to allow time to fully vet the efficacy of Data Hive. Since then, Data Hive has received positive feedback from SVCE’s 3rd party program partners. For the GridShift: EV Charging program, Data Hive was successfully integrated into the GridShift app such that the entire customer enrollment process is on-app, significantly reducing program administration costs.

Interviews with 3rd parties indicated strong support for key features of the platform such as: streamlined 3rd party registration process, streamlined customer consent using one-time passcodes, and scope of data.

The above reasons have led to the decision to pursue a full-scale, multi-year Data Hive program. In November 2021, the pilot term was extended to February 15, 2022 to allow time to negotiate a long-term contract with UAPI. Due to delays associated with the holidays, staff recommends extending the pilot term through April 15, 2022 to allow time to complete negotiations for a long-term contract with UAPI, which would be brought to the Board for approval in a future meeting.

Staff Request to Extend the Contract Terms & Budget
The June 2019 request to the Board for spending authority of $279,000 was based on UAPI’s pilot proposal.

The subsequent extension that was approved in February 2021 utilized UAPI’s standard pricing model for utility partners ($0.40 per meter per year), adding $73,500 to the total cost of the Data Hive pilot and approximately 8 months to the pilot term. The extension that was approved in November 2021 used the same standard pricing model and added $27,000 to the total cost of the Data Hive pilot and added 3 months to the pilot term. The requested extension will use the same standard pricing model and add $18,000 to the total cost of the Data Hive pilot (now $397,500) and add 2 months to the pilot term.

STRATEGIC PLAN
The proposal supports SVCE’s updated 2021-2022 Strategic Plan Goal 8, which is to “coordinate development of decarbonization strategy, lead design of local policy and programs, and support program deployment.”

ALTERNATIVE
The primary alternative to the Staff recommendation is to not extend the Data Hive pilot term and allow the pilot to end once the current funding runs out in February 2022. The Data Hive would be out of service during the time that SVCE is negotiating the long-term contract with UAPI for the full-time Data Hive program. Staff does not recommend this alternative because it would result in an interruption of service for the Data Hive and its users (3
rd parties, SVCE customers, and SVCE programs).

FISCAL IMPACT
The staff proposal has no incremental fiscal impact. Through the annual budget process, the Board approved 2% of annual operating revenues for programs. The Board further approved allocating $600,000 of the programs budget per fiscal year from FY19 through FY22 to implement SVCE’s two innovation programs, Innovation Onramp and Innovation Partners. This extension to the Data Hive pilot with UAPI falls within the Board-approved budget for programs and the funding allocation for innovation.

ATTACHMENTS

1. Fifth Amendment to Agreement with UtilityAPI, Inc.

2. Previous Amendments and Agreement with UtilityAPI, Inc. 2 See SEIA report or a National Renewable Energy Laboratory update: https://www.nrel.gov/docs/fy21osti/78625.pdf Item 1g
-1-

FIFTH AMENDMENT TO AGREEMENT WITH UTILITY API, INC
WHEREAS, the SILICON VALLEY CLEAN ENERGY AUTHORITY, an independent public agency (“Authority”), and UTILITY API, INC entered into that certain agreement entitled ENERGY DATA EXCHANGE PLATFORM PILOT, effective on June 12, 2019, hereinafter referred to as “Original Agreement”; and
WHEREAS, Authority and UTILITY API, INC have determined it is in their mutual interest to amend certain terms of the Original Agreement.

NOW, THEREFORE, FOR VALUABLE CONSIDERATION, THE PARTIES AGREE AS FOLLOWS:

1. TERM section of Original Agreement shall be amended to read as follows:

The term of this Agreement shall commence on June 12, 2019 and shall terminate on April 15, 2022 (“Term”), unless terminated earlier as set forth herein.

2. COMPENSATION TO PARTICIPANT section of Original Agreement shall be amended to read as follows:

Participant shall be compensated for services performed pursuant to this Agreement in a total amount not to exceed three hundred and ninety-seven thousand, five hundred dollars ($397,500.00).

3. EXHIBIT B SCHEDULE OF PERFORMANCE section of Original Agreement shall be amended to read as follows:

Milestone 11: Launch and maintain platform / Promotion activities & Ongoing support April 2022
Note – As of February 2022, all other deliverables have been completed.

4. EXHIBIT C COMPENSATION section of Original Agreement shall be amended to read as follows:

The compensation to be paid to Participant under this Agreement for all services described in Exhibit “A” shall not exceed a total of three hundred and ninety-seven thousand, five hundred dollars ($397,500.00), as set forth below. Any work performed for which payment would result in a total exceeding the maximum amount of compensation set forth herein shall be at no cost to Authority unless previously approved in writing by Authority. No reimbursable expenses are contemplated as a part of this Agreement.

Deliverable 11: Launch and maintain platform / Promotion activities & Ongoing support Note – As of February 2022, all other deliverables have been completed. $9,000 each month, not to exceed $18,000 in aggregate
Item 1g
Attachment 1
-2-
Original + Amendment 1 + Amendment 2 + Amendment 3 +
Amendment 4
$279,000+$0+$0+$73,500 + $27,000
Total - not to exceed $379,500
Amendment 5
Deliverables 11 $18,000
Total - not to exceed $397,500

5. This Amendment shall be effective on February 9, 2022.

6. Except as expressly modified herein, all of the provisions of the Original Agreement shall remain in full force and effect. In the case of any inconsistencies between the Original Agreement and this Amendment, the terms of this Amendment shall control.

7. This Amendment may be executed in counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

IN WITNESS WHEREOF, the parties have caused this Amendment to be executed as of the dates set forth besides their signatures below.

RECOMMENDED FOR APPROVAL
___________________________________________________________ Don Bray, Director of Account Services & Community Relations

RECOMMENDED FOR APPROVAL
__________________________________________
Amrit Singh, Director of Finance and Administration

CONSULTANT NAME

UTILITY API
By: __________________________
Name: ________________________
Title: _________________________
Date: __________________________

SILICON VALLEY CLEAN ENERGY

AUTHORITY
A Joint Powers Authority
By: ___________________________
Name: Girish Balachandran
Title: Chief Executive Officer
Date: __________________________
Item 1g
Attachment 1
-3-
APPROVED AS TO FORM:
_______________________
Counsel for Authority
ATTEST:
_____________________
Authority Clerk
Item 1g
Attachment 1
DocuSign Envelope ID: 74C9B0D9-DE83-4DA9-8FA7-5ED740AAF26B -1-

FOURTH AMENDMENT TO AGREEMENT WITH UTILITY API, INC
WHEREAS, the SILICON VALLEY CLEAN ENERGY AUTHORITY, an independent public agency (“Authority”), and UTILITY API, INC entered into that certain agreement entitled ENERGY DATA EXCHANGE PLATFORM PILOT, effective on June 12, 2019, hereinafter referred to as “Original Agreement”; and
WHEREAS, Authority and UTILITY API, INC have determined it is in their mutual interest to amend certain terms of the Original Agreement.

NOW, THEREFORE, FOR VALUABLE CONSIDERATION, THE PARTIES AGREE AS FOLLOWS:

1. TERM section of Original Agreement shall be amended to read as follows:

The term of this Agreement shall commence on June 12, 2019, and shall terminate on February 15, 2022 (“Term”), unless terminated earlier as set forth herein.

2. COMPENSATION TO PARTICIPANT section of Original Agreement shall be amended to read as follows:

Participant shall be compensated for services performed pursuant to this Agreement in a total amount not to exceed three hundred and seventy-nine thousand, five hundred dollars ($379,500.00).

3. EXHIBIT B SCHEDULE OF PERFORMANCE section of Original Agreement shall be amended to read as follows:

Milestone 10: Launch and maintain platform / Promotion activities & Ongoing support
February
2022
Note – As of November 2021, all other deliverables have been completed.

4. EXHIBIT C COMPENSATION section of Original Agreement shall be amended to read as follows:

The compensation to be paid to Participant under this Agreement for all services described in Exhibit “A” shall not exceed a total of three hundred and seventy-nine thousand, five hundred dollars ($379,500.00), as set forth below. Any work performed for which payment would result in a total exceeding the maximum amount of compensation set forth herein shall be at no cost to Authority unless previously approved in writing by Authority. No reimbursable expenses are contemplated as a part of this Agreement.

Deliverable 10: Launch and maintain platform / Promotion activities & Ongoing support Note – As of November 2021, all other deliverables have been completed. $9,000 each month, not to exceed $27,000 in aggregate
Item 1g
Attachment 2
Fourth Amendment with Utility API, Inc.

DocuSign Envelope ID: 74C9B0D9-DE83-4DA9-8FA7-5ED740AAF26B -2-
Original + Amendment 1 + Amendment 2 + Amendment 3
$279,000+$0+$0+$73,000
Total - not to exceed $352,500
Amendment 4
Deliverables 10 $27,000
Total - not to exceed $379,500

5. This Amendment shall be effective on November 11, 2021.

7. This Amendment may be executed in counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

IN WITNESS WHEREOF, the parties have caused this Amendment to be executed as of the dates set forth besides their signatures below.

RECOMMENDED FOR APPROVAL
Don Bray, Director of Account Services & Community Relations

RECOMMENDED FOR APPROVAL
Amrit Singh, Director of Finance and Administration

CONSULTANT NAME

UTILITY API
By:

Name:Lynne Wander

SILICON VALLEY CLEAN ENERGY

AUTHORITY
A Joint Powers Authority
By:

Title: Chief Operating Officer Name: Girish Balachandran Date: 11/16/2021 Title: Chief Executive Officer
Date: 11/16/2021
Item 1g
Attachment 2
Fourth Amendment with Utility API, Inc.

DocuSigned by:
25ABQQQD5413484...

DocuSigned by:
[
A88F IDF92E8F467...

DocuSigned by:

DocuSigned by:
(AXAJU
&Y\ih O50833D64586468
5CA64B0AC4C24C3.

DocuSign Envelope ID: 74C9B0D9-DE83-4DA9-8FA7-5ED740AAF26B -3-
ATTEST:

APPROVED AS TO FORM:

Counsel for Authority
Authority Clerk
Item 1g
Attachment 2
Fourth Amendment with Utility API, Inc.

DocuSigned by:
60CEDD7661684C2
DocuSigned by:
hA4 /3t> b /bUl- /449
DocuSign Envelope ID: A65A004F-2E3D-4819-B821-A8D46667F0CD -1-

THIRD AMENDMENT TO AGREEMENT WITH UTILITYAPI, INC
WHEREAS, the SILICON VALLEY CLEAN ENERGY AUTHORITY, an independent public agency (“Authority”), and UTILITYAPI, INC entered into that certain agreement entitled ENERGY DATA EXCHANGE PLATFORM PILOT, effective on June 12, 2019, hereinafter referred to as “Original Agreement”; and

NOW, THEREFORE, FOR VALUABLE CONSIDERATION, THE PARTIES AGREE AS FOLLOWS:

1. TERM of Original Agreement shall be amended to read as follows:

The term of this Agreement shall commence on June 12, 2019 and shall terminate on November 15, 2021 (“Term”), unless terminated earlier as set forth herein.

2. COMPENSATION TO PARTICIPANT of Original Agreement shall be amended to read as follows:

Participant shall be compensated for services performed pursuant to this Agreement in a total amount not to exceed three hundred and fifty-two thousand, five hundred dollars ($352,500.00) based on the rates and terms set forth in Exhibit “C”, which is attached hereto and incorporated herein by this reference.

3. EXHIBIT A SCOPE OF SERVICES of Original Agreement shall be amended to read as follows:

Launch, Operations & Support:

End of setup through a 20 month term:

Task 1: Launch & maintain platform
Task 2: Promotion activities
Marketing by SVCE
Marketing by UtilityAPI
Task 3: Ongoing support, including biweekly reporting and check in

4. EXHIBIT B SCHEDULE OF PERFORMANCE of Original Agreement shall be amended to read as follows:

Launch, Operations & Support, Task 1 / Launch and maintain platform
Monthly for a 20 month term
starting at platform launch and
beginning of software license
Launch, Operations & Support, Tasks 2 & 3 / Promotion
activities & Ongoing support
Monthly for a 20 month term
starting at platform launch and
beginning of software license
Item 1g
Attachment 2
Third Amendment to Agreement with Utility API, Inc.

DocuSign Envelope ID: A65A004F-2E3D-4819-B821-A8D46667F0CD -2-

5. EXHIBIT C COMPENSATION of Original Agreement shall be amended to read as follows:

The compensation to be paid to Participant under this Agreement for all services described in Exhibit “A” shall not exceed a total of three hundred and fifty-two thousand, five hundred dollars ($352,500), as set forth below. Any work performed for which payment would result in a total exceeding the maximum amount of compensation set forth herein shall be at no cost to Authority unless previously approved in writing by Authority. No reimbursable expenses are contemplated as a part of this Agreement.

Deliverable 8: Launch, Operations & Support, Task 1 /Launch and maintain platform Months 1-4
$22,500 per month
Months 5-11
$0 per month if there are fewer than 90 Unique Account Holders Served* for that month $7,500 per month if there are at least 90 Unique Account Holders Served* for that month Months 12-20
$4,500 per month
Total Deliverable 8 payments are not to exceed $145,500 in aggregate (total spend months 1-20) *For the purposes of the Agreement, ‘Unique Account Holders Served’ shall be defined as the number of distinct email addresses associated with an authorization or collection of data in the billing month.

Multiple data pulls in a month, data pulls encompassing multiple meters, and data pulls across multiple accounts supporting the same email address will count as only one Unique Account Holder Served for that month; each billing month will reset and the email address can be counted again as a Unique Account Holder Served in a preceding month if any of these actions recur in that month.

Deliverable 9: Launch, Operations & Support, Tasks 2 & 3 /Promotion activities & Ongoing support $4,500 each month, not to exceed $90,000 in aggregate
Original+ Amendment 1+ Amendment 2
$279,000+$0+$0 $279,000
Total - not to exceed
Amendment 3
Total - not to exceed $73,500
New Total
Deliverables 1-7 $117,000
Deliverables 8 $145,500
Deliverables 9 $90,000
Total - not to exceed $352,500

6. This Amendment shall be effective on February 11, 2021.

Item 1g
Attachment 2
Third Amendment to Agreement with Utility API, Inc.

DocuSign Envelope ID: A65A004F-2E3D-4819-B821-A8D46667F0CD -3-

RECOMMENDED FOR APPROVAL

RECOMMENDED FOR APPROVAL
ATTEST:

7. Except as expressly modified herein, all of the provisions of the Original Agreement shall remain in full force and effect. In the case of any inconsistencies between the Original Agreement and this Amendment, the terms of this Amendment shall control.

8. This Amendment may be executed in counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

IN WITNESS WHEREOF, the parties have caused this Amendment to be executed as of the dates set forth besides their signatures below.

Don Bray, Director of Account Services & Community Relations Amrit Singh, Chief Financial Officer/Director of Administrative Services

CONSULTANT NAME

UTILITYAPI, INC
By:

Name: Lynne Wander
Title: Chief Operating Officer
Date: 2/16/2021

SILICON VALLEY CLEAN ENERGY

AUTHORITY
A Joint Powers Authority
By:

Name: Girish Balachandran
Title: Chief Executive Officer
Date: 2/17/2021
APPROVED AS TO FORM:

Counsel for Authority
Authority Clerk
Item 1g
Attachment 2
Third Amendment to Agreement with Utility API, Inc.

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DocuSign Envelope ID: B9B77574-406B-4CFD-AA22-5B9507188136 -1-

SECOND AMENDMENT TO AGREEMENT WITH UTILITYAPI, INC
WHEREAS, the SILICON VALLEY CLEAN ENERGY AUTHORITY, an independent public agency (“Authority”), and UTILITYAPI, INC entered into that certain agreement entitled ENERGY DATA EXCHANGE PLATFORM PILOT, effective on June 12, 2019, hereinafter referred to as “Original Agreement”; and

NOW, THEREFORE, FOR VALUABLE CONSIDERATION, THE PARTIES AGREE AS FOLLOWS:

1. TERM of Original Agreement shall be amended to read as follows:

The term of this Agreement shall commence on June 12, 2019 and shall terminate on July 15, 2021 or once payment for services performed pursuant to this Agreement reach the not-to-exceed total amount of compensation based on the rates and terms set forth in Exhibit “C” (“Term”), unless terminated earlier as set forth herein.

2. EXHIBIT A SCOPE OF SERVICES of Original Agreement shall be amended to read as follows:

Launch, Operations & Support:

End of setup through an up to 16 month term:

Task 1: Launch & maintain platform
Task 2: Promotion activities
Marketing by SVCE
Marketing by UtilityAPI
Task 3: Ongoing support, including biweekly reporting and check in

3. EXHIBIT B SCHEDULE OF PERFORMANCE of Original Agreement shall be amended to read as follows:

Launch, Operations & Support, Task 1 / Launch and maintain platform
Monthly for an up to 16-month
term starting at platform launch and
beginning of software license
Launch, Operations & Support, Tasks 2 & 3 / Promotion
activities & Ongoing support
Monthly for an up to 16-month
term starting at platform launch and
beginning of software license

4. EXHIBIT C COMPENSATION of Original Agreement shall be amended to read as follows:

Deliverable 8: Launch, Operations & Support, Task 1 /Launch and maintain platform For the first four months of a public-facing platform: $22,500 each month, not to exceed $90,000 in aggregate
Item 1g
Attachment 2
Second Amendment with Utility API, Inc.

DocuSign Envelope ID: B9B77574-406B-4CFD-AA22-5B9507188136 -2-
For all subsequent months of a public-facing platform: $0 each month for any months in which the total number of Unique Account Holders Served is below 90; $7,500 each month for any months in which the total number of Unique Account Holders Served is 90 or more, not to exceed $31,500 in aggregate Months 1-4
$22,500 per month
Months 5-16
$0 per month if there are fewer than 90 Unique Account Holders Served* for that month $7,500 per month if there are at least 90 Unique Account Holders Served* for that month Total Deliverable 8 payments are not to exceed $121,500 in aggregate *For the purposes of the Agreement, ‘Unique Account Holders Served’ shall be defined as the number of distinct email addresses associated with an authorization or collection of data in the billing month.

Deliverable 9: Launch, Operations & Support, Tasks 2 & 3 /Promotion activities & Ongoing support $4,500 each month, not to exceed $72,000 in aggregate

5. This Amendment shall be effective on September 21, 2020.

7. This Amendment may be executed in counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

IN WITNESS WHEREOF, the parties have caused this Amendment to be executed as of the dates set forth besides their signatures below.

RECOMMENDED FOR APPROVAL
Don Bray, Director of Account Services & Community Relations Item 1g
Attachment 2
Second Amendment with Utility API, Inc.

DocuSigned by:
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DocuSign Envelope ID: B9B77574-406B-4CFD-AA22-5B9507188136 -3-

CONSULTANT NAME

UTILITYAPI, INC
By:

Name: Lynne Wander
Title: Chief Operating Officer
Date:9/22/2020

SILICON VALLEY CLEAN ENERGY

AUTHORITY
A Joint Powers Authority
By:

Name: Girish Balachandran
Title: Chief Executive Officer
Date:9/22/2020
Item 1g
Attachment 2
Second Amendment with Utility API, Inc.

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DocuSign Envelope ID: 3379A2B3-3E76-4818-B282-79D7EBCEDA95 -1-

FIRST AMENDMENT TO AGREEMENT WITH UTILITYAPI, INC
WHEREAS, the SILICON VALLEY CLEAN ENERGY AUTHORITY, an independent public agency (“Authority”), and UTILITYAPI, INC entered into that certain agreement entitled ENERGY DATA EXCHANGE PLATFORM PILOT, effective on June 12, 2019, hereinafter referred to as “Original Agreement”; and
WHEREAS, Authority and UTILITYAPI, INC have determined it is in their mutual interest to amend certain terms of the Original Agreement.

NOW, THEREFORE, FOR VALUABLE CONSIDERATION, THE PARTIES AGREE AS FOLLOWS:

1. TERM section of Original Agreement shall be amended to read as follows:

The term of this Agreement shall commence on June 12, 2019 and shall terminate on September 30, 2020 or a cap of 20,000 data transactions (“Term”), unless terminated earlier as set forth herein.

2. This Amendment shall be effective on May 5, 2020.

3. Except as expressly modified herein, all of the provisions of the Original Agreement shall remain in full force and effect. In the case of any inconsistencies between the Original Agreement and this Amendment, the terms of this Amendment shall control.

4. This Amendment may be executed in counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

IN WITNESS WHEREOF, the parties have caused this Amendment to be executed as of the dates set forth besides their signatures below.

RECOMMENDED FOR APPROVAL
Aimee Bailey, Director of Decarbonization and Grid Innovation Programs

RECOMMENDED FOR APPROVAL
Don Eckert, Director of Finance and Administration
Item 1g
Attachment 2
First Amendment with Utilty API, Inc.

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DocuSign Envelope ID: 3379A2B3-3E76-4818-B282-79D7EBCEDA95 -2-

CONSULTANT NAME

UTILITYAPI, INC
By:

Lynne Wander
Name:

SILICON VALLEY CLEAN ENERGY

AUTHORITY
A Joint Powers Authority
By:

Title: Chief Operating Officer
5/6/2020 Name: Girish Balachandran
Date: Title: Chief Executive Officer
Date: 5/6/2020
Item 1g
Attachment 2
First Amendment with Utilty API, Inc.

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DocuSign Envelope ID: A592005D-9393-4E3D-8864-16CEDD6984D2

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AGREEMENT BETWEEN THE SILICON VALLEY CLEAN ENERGY

AUTHORITY AND
UTILITYAPI, INC. FOR

ENERGY DATA EXCHANGE PLATFORM PILOT
THIS AGREEMENT, is entered into this 12th day of June, 2019, by and between the SILICON VALLEY CLEAN ENERGY AUTHORITY, an independent public agency, ("Authority"), and UtilityAPI, Inc, a Delaware Corporation whose address is 1212 Broadway, 16th floor, Oakland, CA 94618 (hereinafter referred to as "Participant") (collectively referred to as the “Parties”).

RECITALS:

A. Authority is an independent public agency duly organized under the provisions of the Joint Exercise of Powers Act of the State of California (Government Code Section 6500 et seq.) (“Act”) with the power to conduct its business and enter into agreements.

B. Authority has launched an innovation pilot partnership program called Innovation Onramp in order to facilitate and support innovative research and the evaluation, testing, and implementation of innovative, emerging technologies and ideas, with the goal of accelerating decarbonization.

C. Participant has submitted a pilot project proposal to the Innovation Onramp program, pursuant to which Participant proposes to provide a drop-in data exchange platform that third parties can use to request and download customer utility bill and usage data. (the “Project”).

D. Participant possesses the skill, experience, ability, background, training and knowledge to provide the services described in this Agreement pursuant to the terms and conditions described herein.

E. Authority and Participant desire to enter into an agreement to carry out the Project upon the terms and conditions herein.

NOW, THEREFORE, the Parties mutually agree as follows:

1. TERM
The term of this Agreement shall commence on June 12, 2019, and shall terminate on July 1, 2020 or a cap of 20,000 data transactions (“Term”), unless terminated earlier as set forth herein.

2. SERVICES TO BE PERFORMED
Participant shall perform each and every service set forth in Exhibit "A" pursuant to the schedule of performance set forth in Exhibit "B," both of which are attached hereto and incorporated herein by this reference.

Item 1g
Attachment 2
Agreement with Utility API, Inc.

DocuSign Envelope ID: A592005D-9393-4E3D-8864-16CEDD6984D2

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3. COMPENSATION TO PARTICIPANT
Participant shall be compensated for services performed pursuant to this Agreement in a total amount not to exceed two hundred and seventy-nine thousand dollars ($279,000.00) based on the rates and terms set forth in Exhibit "C," which is attached hereto and incorporated herein by this reference.

4. TIME IS OF THE ESSENCE
Participant and Authority agree that time is of the essence regarding the performance of this Agreement.

5. STANDARD OF CARE
Participant agrees to perform all services required by this Agreement in a manner commensurate with the prevailing standards of specially trained professionals in the San Francisco Bay Area and agrees that all services shall be performed by qualified and experienced personnel.

6. INDEPENDENT PARTIES
Authority and Participant intend that the relationship between them created by this Agreement is that of an independent contractor. The manner and means of conducting the work are under the control of Participant, except to the extent they are limited by statute, rule or regulation and the express terms of this Agreement. No civil service status or other right of employment will be acquired by virtue of Participant's services. None of the benefits provided by Authority to its employees, including but not limited to, unemployment insurance, workers’ compensation plans, vacation and sick leave are available from Authority to Participant, its employees or agents. Deductions shall not be made for any state or federal taxes, FICA payments, PERS payments, or other purposes normally associated with an employer-employee relationship from any fees due Participant. Payments of the above items, if required, are the responsibility of Participant.

7. NO RECOURSE AGAINST CONSTITUENT MEMBERS OF

AUTHORITY
Authority is organized as a Joint Powers Authority in accordance with the Joint Powers Act of the State of California (Government Code Section 6500 et seq.) pursuant to a Joint Powers Agreement dated March 31, 2016, and is a public entity separate from its constituent members. Authority shall solely be responsible for all debts, obligations and liabilities accruing and arising out of this Agreement. Contractor shall have no rights and shall not make any claims, take any actions or assert any remedies against any of Authority’s constituent members in connection with this Agreement.

8. NON-DISCRIMINATION
Participant agrees that it shall not harass or discriminate against a job applicant, an Authority employee, or Participant’s employee or subcontractor on the basis of race, religious creed, color, national origin, ancestry, handicap, disability, marital status, pregnancy, sex, age, sexual orientation, or any other protected class. Participant agrees that any and all violations of this provision shall constitute a material breach of this Agreement.

9. HOLD HARMLESS AND INDEMNIFICATION
A. General Indemnification. Participant shall, to the fullest extent allowed by law and without limitation of the provisions of this Agreement related to insurance, with respect Item 1g
Attachment 2
Agreement with Utility API, Inc.

DocuSign Envelope ID: A592005D-9393-4E3D-8864-16CEDD6984D2

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to all services performed in connection with the Agreement, indemnify, defend, and hold harmless the Authority and its members, officers, officials, agents, employees and volunteers from and against any and all liability, claims, actions, causes of action, demands, damages, losses, costs, and expenses of any nature whatsoever (“Claims”), including any injury to or death of any person or damage to property or other liability of any nature, whether physical, emotional, consequential or otherwise, arising out of, pertaining to, or related to the performance of this Agreement by Participant or Participant’s employees, officers, officials, agents or independent contractors. Such costs and expenses shall include reasonable attorneys’ fees of counsel of Authority’s choice, expert fees and all other costs and fees of litigation.

B. Intellectual Property Indemnification. Participant hereby certifies that it owns, controls, or licenses and retains all right, title, and interest in and to any intellectual property it uses in relation to this Agreement, including the design, look, feel, features, source code, content, and other technology relating to any part of the Project and including all related patents, inventions, trademarks, and copyrights, all applications therefor, and all trade names, service marks, know how, and trade secrets (collectively referred to as “IP Rights”), except as otherwise expressly provided by this Agreement. Participant warrants that the Equipment, the Project, and any related services to be provided pursuant to this Agreement do not infringe, violate, trespass, or constitute the unauthorized use or misappropriation of any IP Rights of any third party. Participant shall indemnify, defend, and hold Authority, its members, officers, employees, and volunteers, harmless from and against any Claims by a third party that the Equipment, the Project, or any related services to be provided pursuant to this Agreement infringe or violate any third-part’s IP Rights, provided any such right is enforceable in the United States. Such costs and expenses shall include reasonable attorneys’ fees of counsel of Authority’s choice, expert fees and all other costs and fees of litigation.

C. The acceptance of the services by Authority shall not operate as a waiver of these rights of indemnification. The hold harmless and indemnification provisions of this Section shall apply regardless of whether or not any insurance policies are determined to be applicable to the Claim.

D. The provisions of this Section shall survive the completion of the Project or termination of this Agreement.

10. INSURANCE:

A. General Requirements. On or before the commencement of the Term of this Agreement, Participant shall furnish Authority with certificates showing the type, amount, class of operations covered, effective dates and dates of expiration of insurance coverage in compliance with the requirements listed in Exhibit "D," which is attached hereto and incorporated herein by this reference. Such insurance and certificates, which do not limit Participant’s indemnification obligations under this Agreement, shall also contain substantially the following statement: "Should any of the above insurance covered by this certificate be canceled or coverage reduced before the expiration date thereof, the insurer affording coverage shall provide thirty (30) days’ advance written notice to the Authority by certified mail, Attention: Chief Executive Officer." Participant shall maintain in force at all times during the performance of this Agreement all appropriate coverage of insurance required by this Agreement with an insurance company that is acceptable to Authority and licensed to do insurance business in the State of California. Endorsements naming the Authority as additional insured shall be submitted with the insurance certificates.

Item 1g
Attachment 2
Agreement with Utility API, Inc.

DocuSign Envelope ID: A592005D-9393-4E3D-8864-16CEDD6984D2

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B. Subrogation Waiver. Participant agrees that in the event of loss due to any of the perils for which he/she has agreed to provide comprehensive general and automotive liability insurance, Participant shall look solely to his/her/its insurance for recovery.

Participant hereby grants to Authority, on behalf of any insurer providing comprehensive general and automotive liability insurance to either Participant or Authority with respect to the services of Participant herein, a waiver of any right to subrogation which any such insurer of Participant may acquire against Authority by virtue of the payment of any loss under such insurance.

C. Failure to secure or maintain insurance. If Participant at any time during the Term should fail to secure or maintain the foregoing insurance, Authority shall be permitted to obtain such insurance in the Participant's name or as an agent of the Participant and shall be compensated by the Participant for the costs of the insurance premiums at the maximum rate permitted by law and computed from the date written notice is received that the premiums have not been paid.

D. Additional Insured. Authority, its members, officers, employees and volunteers shall be named as additional insureds under all insurance coverages, except any professional liability insurance, required by this Agreement. The naming of an additional insured shall not affect any recovery to which such additional insured would be entitled under this policy if not named as such additional insured. An additional insured named herein shall not be held liable for any premium, deductible portion of any loss, or expense of any nature on this policy or any extension thereof. Any other insurance held by an additional insured shall not be required to contribute anything toward any loss or expense covered by the insurance provided by this policy.

E. Sufficiency of Insurance. The insurance limits required by Authority are not represented as being sufficient to protect Participant. Participant is advised to confer with Participant's insurance broker to determine adequate coverage for Participant.

F. Maximum Coverage and Limits. It shall be a requirement under this Agreement that any available insurance proceeds broader than or in excess of the specified minimum Insurance coverage requirements and/or limits shall be available to the additional insureds. Furthermore, the requirements for coverage and limits shall be the minimum coverage and limits specified in this Agreement, or the broader coverage and maximum limits of coverage of any insurance policy or proceeds available to the named insured, whichever is greater.

G. Subcontractors. Participant shall require all subcontractors to procure and maintain insurance policies subject to the requirements of Exhibit “D.” Failure of Participant to verify existence of subcontractor’s insurance shall not relieve Participant from any claim arising from subcontractor’s work on behalf of Participant.

11. CONFLICT OF INTEREST
Participant warrants that it presently has no interest, and will not acquire any interest, direct or indirect, financial or otherwise, that would conflict in any way with the performance of this Agreement, and that it will not employ any person having such an interest. Participant agrees to advise Authority immediately if any conflict arises and understands that it may be required to fill out a conflict of interest form if the services provided under this Agreement require Participant to make certain governmental decisions or serve in a staff Authority, as defined in Title 2, Division 6, Section 18700 of the California Code of Regulations.

12. PROHIBITION AGAINST TRANSFERS
Item 1g
Attachment 2
Agreement with Utility API, Inc.

DocuSign Envelope ID: A592005D-9393-4E3D-8864-16CEDD6984D2

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The Parties agree that the expertise and experience of Participant are material considerations for this Agreement. Participant shall not assign, sublease, hypothecate, or transfer this Agreement, or any interest therein, directly or indirectly, by operation of law or otherwise, without prior written consent of Authority. Any attempt to do so without such consent shall be null and void, and any assignee, sublessee, pledgee, or transferee shall acquire no right or interest by reason of such attempted assignment, hypothecation or transfer. Consent to one assignment will not be deemed to be consent to any subsequent assignment. However, claims for money by Participant from Authority under this Agreement may be assigned to a bank, trust company or other financial institution without prior written consent. Written notice of such assignment shall be promptly furnished to Authority by Participant.

The sale, assignment, transfer or other disposition of any of the issued and outstanding capital stock of Participant, or of the interest of any general partner or joint venturer or syndicate member or cotenant, if Participant is a partnership or joint venture or syndicate or cotenancy, which shall result in changing the control of Participant, shall be construed as an assignment of this Agreement. Control means fifty percent (50%) or more of the voting power of the corporation.

13. SUBCONTRACTOR APPROVAL
Unless prior written consent from Authority is obtained, only those persons and subcontractors whose names are attached to this Agreement shall be used in the performance of this Agreement.

In the event that Participant employs subcontractors, such subcontractors shall be required to furnish proof of workers’ compensation insurance and shall also be required to carry general, automobile and professional liability insurance in substantial conformity to the insurance carried by Participant. In addition, any work or services subcontracted hereunder shall be subject to each provision of this Agreement.

Participant agrees to include within their subcontract(s) with any and all subcontractors the same requirements and provisions of this Agreement, including the indemnity and insurance requirements, to the extent they apply to the scope of the subcontractor’s work. Subcontractors hired by Participant shall agree to be bound to Participant and Authority in the same manner and to the same extent as Participant is bound to Authority under this Agreement. Subcontractors shall agree to include these same provisions within any sub-subcontract. Participant shall provide a copy of the Indemnity and Insurance provisions of this Agreement to any subcontractor. Participant shall require all subcontractors to provide valid certificates of insurance and the required endorsements prior to commencement of any work and will provide proof of compliance to Authority.

14. REPORTS
A. Each and every report, draft, work product, map, record and other document, hereinafter collectively referred to as "Report", reproduced, prepared or caused to be prepared by Participant pursuant to or in connection with this Agreement, shall be the exclusive property of Authority. Participant shall not copyright any Report required by this Agreement and shall execute appropriate documents to assign to Authority the copyright to Reports created pursuant to this Agreement. Any Report, information and data acquired or required by this Agreement shall become the property of Authority, and all publication rights are reserved to Authority. Participant may retain a copy of any Report furnished to the Authority pursuant to this Agreement.

Item 1g
Attachment 2
Agreement with Utility API, Inc.

DocuSign Envelope ID: A592005D-9393-4E3D-8864-16CEDD6984D2

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B. All Reports prepared by Participant may be used by Authority in execution or implementation of: (1) The original Project for which Participant was hired; (2) Completion of the original Project by others; (3) Subsequent additions to the original Project; and/or (4) Other Authority projects as Authority deems appropriate in its sole discretion.

C. Participant shall, at such time and in such form as Authority may require, furnish reports concerning the status of services required under this Agreement.

D. All Reports required to be provided by this Agreement shall be printed on recycled paper. All Reports shall be copied on both sides of the paper except for one original, which shall be single sided. All Reports shall also be provided in electronic format, both in the original file format (e.g., Microsoft Word) and in PDF format.

E. No Report, information or other data given to or prepared or assembled by Participant pursuant to this Agreement shall be made available to any individual or organization by Participant without prior approval by Authority.

15. RECORDS
Participant shall maintain complete and accurate records with respect to costs, expenses, receipts and other such information required by Authority that relate to the performance of services under this Agreement, in sufficient detail to permit an evaluation of the services and costs. All such records shall be maintained in accordance with generally accepted accounting principles and shall be clearly identified and readily accessible.

Participant shall provide free access to such books and records to the representatives of Authority or its designees at all proper times, and gives Authority the right to examine and audit same, and to make transcripts therefrom as necessary, and to allow inspection of all work, data, documents, proceedings and activities related to this Agreement. Such records, together with supporting documents, shall be maintained for a minimum period of five (5) years after Participant receives final payment from Authority for all services required under this agreement.

If supplemental examination or audit of the records is necessary due to concerns raised by Authority's preliminary examination or audit of records, and the Authority's supplemental examination or audit of the records discloses a failure to adhere to appropriate internal financial controls, or other breach of contract or failure to act in good faith, then Participant shall reimburse Authority for all reasonable costs and expenses associated with the supplemental examination or audit.

16. PARTY REPRESENTATIVES
Aimee Bailey, Director of Decarbonization and Grid Innovation shall represent the Authority in all matters pertaining to the services to be performed under this Agreement.

Lynne Wander, Chief Operating Officer shall represent Participant in all matters pertaining to the services to be performed under this Agreement.

17. CONFIDENTIAL INFORMATION
A. Participant shall maintain in confidence and not disclose to any third party or use in any manner not required or authorized under this Agreement any and all Confidential Information held by Authority or provided to Participant by Authority.

B. The term “Confidential Information” includes all information, documents, and materials owned by Authority or Participant, including technical, financial, business, or utility customers’ personal information which is not available to the general public, as well as information derived from such information, which is furnished or made available Item 1g
Attachment 2
Agreement with Utility API, Inc.

DocuSign Envelope ID: A592005D-9393-4E3D-8864-16CEDD6984D2

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to Participant. Information received by Participant shall not be considered Confidential Information if: (i) it is or becomes available to the public through no wrongful act of Participant; (ii) it is already in the possession of Participant and not subject to any confidentiality agreement between the Parties; (iii) it is received from a third party without restriction for the benefit of Authority and without breach of this Agreement; (iv) it is independently developed by Participant; or (v) it is disclosed pursuant to a requirement of law, a duly empowered government agency, or a court of competent jurisdiction after due notice and an adequate opportunity to intervene is given to Authority, unless such notice is prohibited.

C. As practicable, Authority shall mark Confidential Information with the words “Confidential” or “Confidential Material” or with words of similar import, or, if that is not possible, Authority shall notify the Participant (for example, by cover e-mail transmitting an electronic document) that the material is Confidential Information.

Authority’s failure, for whatever reason, to mark or notify Participant at the time the material is produced shall not take the material out of the coverage of this Agreement.

D. Participant will direct its employees, contractors, consultants, and representatives who have access to any Confidential Information to comply with the terms of this Section.

E. Upon termination or expiration of this Agreement, Participant shall, at Authority’s direction, either return or destroy all such Confidential Information and shall so certify in writing, provided, however, any Confidential Information (i) found in drafts, notes, studies, and other documents prepared by or for Authority or its representatives, or (ii) found in electronic format as part of Participant’s off-site or on-site data storage/archival process system, will be held by Participant and kept subject to the terms of this provision or destroyed at Participant’s option. The obligations of this provision will survive termination or expiration of this Agreement.

18. DATA SECURITY
If, pursuant to this Agreement, Authority shares with Participant personal information as defined in California Civil Code Section 1798.81.5(d) about a California resident (“Personal Information”), Participant shall maintain reasonable and appropriate security procedures to protect that Personal Information, and shall inform Authority immediately upon learning that there has been a breach in the security of the system or in the security of the Personal Information. Participant shall not use Personal Information for direct marketing purposes without Authority’s express written consent. For purposes of this provision, security procedures are “reasonable and appropriate” when they (i) adequately address all reasonable foreseeable threats to Personal Information, (ii) are appropriate to the quantity, sensitivity, and type of Personal Information accessed and the way that information will be accessed, and (iii) comply with all laws, regulations, and government rules or directives applicable to the Participant in connection with its access of Personal Information.

19. NOTICES
All notices, demands, requests or approvals to be given under this Agreement shall be given in writing and conclusively shall be deemed served when delivered personally or on the second business day after the deposit thereof in the United States Mail, postage prepaid, registered or certified, addressed as hereinafter provided.

All notices, demands, requests, or approvals shall be addressed as follows:

Item 1g
Attachment 2
Agreement with Utility API, Inc.

DocuSign Envelope ID: A592005D-9393-4E3D-8864-16CEDD6984D2

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TO AUTHORITY:
333 W. El Camino Real
Suite 290
Sunnyvale, CA 94087
Attention: Aimee Bailey
TO PARTICIPANT:

Lynne Wander, Chief Operating Officer
UtilityAPI, Inc
1212 Broadway, Floor 16
Oakland, CA 94607

20. TERMINATION
In the event either Party fails or refuses to perform any of the provisions hereof at the time and in the manner required hereunder, that Party shall be deemed in default in the performance of this Agreement (“Defaulting Party”). If the Defaulting Party fails to cure the default within 30 days of receipt of notice from the non-Defaulting Party, and in addition to any other remedy available to the non-Defaulting Party by law, the non-Defaulting Party may terminate the Agreement by giving the Defaulting Party written notice thereof, which shall be effective immediately. Each Party shall also have the option, at its sole discretion and without cause, of terminating this Agreement by giving thirty (30) calendar days' prior written notice to the other Party as provided herein. Upon receipt of any notice of termination by the Authority, Participant shall immediately discontinue performance.

Authority shall pay Participant for services satisfactorily performed up to the effective date of termination. If the termination is for cause, Authority may deduct from such payment the amount of actual damage, if any, sustained by Authority due to Participant’s failure to perform its material obligations under this Agreement. Upon termination, Participant shall immediately deliver to the Authority any and all copies of studies, sketches, drawings, computations, and other material or products, whether or not completed, prepared by Participant or given to Participant, in connection with this Agreement. Such materials shall become the property of Authority.

21. COMPLIANCE
Participant shall keep informed of and comply with all applicable local, state and federal laws. Participant shall procure all applicable permits and licenses, pay all applicable charges and fees, and give all notices as may be required by law in the performance of services under this Agreement.

22. CONFLICT OF LAW
This Agreement shall be interpreted under, and enforced by the laws of the State of California. The Agreement and obligations of the parties are subject to all valid laws, orders, rules, and regulations of the authorities having jurisdiction over this Agreement (or the successors of those authorities). Any suits brought pursuant to this Agreement shall be filed with the Superior Court of the County of Santa Clara, State of California.

Item 1g
Attachment 2
Agreement with Utility API, Inc.

DocuSign Envelope ID: A592005D-9393-4E3D-8864-16CEDD6984D2

Page 9 of 15 ends

23. ADVERTISEMENT
Participant shall not post, exhibit, display or allow to be posted, exhibited, displayed any signs, advertising, show bills, lithographs, posters, cards, news releases, annual reports, product packaging, print literature, websites, or other media of any kind pertaining to the services performed under this Agreement or using the name, trade name, trademarks, or service marks of or owned by Authority, unless prior written approval has been secured from Authority to do otherwise. Participant shall not represent, directly or indirectly, that any product or service has been approved or endorsed by Authority without prior written consent.

24. WAIVER
A waiver by Authority of any breach of any term, covenant, or condition contained herein shall not be deemed to be a waiver of any subsequent breach of the same or any other term, covenant, or condition contained herein, whether of the same or a different character.

25. INTEGRATED CONTRACT
This Agreement represents the full and complete understanding of every kind or nature whatsoever between the Parties, and all preliminary negotiations and agreements of whatsoever kind or nature are merged herein. No verbal agreement or implied covenant shall be held to vary the provisions hereof. Any modification of this Agreement will be effective only by a written document signed by both Authority and Participant. In the event of a conflict between the terms of this Agreement and the exhibits hereto or Participant’s proposal (if any), the Agreement shall control. In the case of any conflict between the exhibits hereto and Participant’s proposal, the exhibits shall control.

26. AUTHORITY
The individual(s) executing this Agreement represent and warrant that they have the legal Authority and authority to do so on behalf of their respective legal entities.

27. INSERTED PROVISIONS
Each provision and clause required by law to be inserted into the Agreement shall be deemed to be enacted herein, and the Agreement shall be read and enforced as though each were included herein. If through mistake or otherwise, any such provision is not inserted or is not correctly inserted, the Agreement shall be amended to make such insertion on application by either party.

28. CAPTIONS AND TERMS
The captions in this Agreement are for convenience only, are not a part of the Agreement and in no way affect, limit or amplify the terms or provisions of this Agreement.

IN WITNESS WHEREOF, the parties have caused the Agreement to be executed as of the date set forth above.

Item 1g
Attachment 2
Agreement with Utility API, Inc.

DocuSign Envelope ID: A592005D-9393-4E3D-8864-16CEDD6984D2

Page 10 of 15 ends

RECOMMENDED FOR APPROVAL
ATTEST:

Aimee Bailey
Director of Decarbonization and Grid Innovation Programs

PARTICIPANT
UtilityAPI
By: _
Name:Lynne Wander
Title: Chief Operating Officer
Date:7/22/2019

SILICON VALLEY CLEAN ENERGY AUTHORITY
A Joint Powers Authority
By:

Name: Girish Balachandran
Title: Chief Executive Officer
Date:7/22/2019
APPROVED AS TO FORM:

Counsel for Authority Authority Clerk
Item 1g
Attachment 2
Agreement with Utility API, Inc.

DocuSigned by:
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DocuSign Envelope ID: A592005D-9393-4E3D-8864-16CEDD6984D2 11 Exhibit A
Scope of Services
The project is to deploy a data exchange platform for SVCE service territory, which would allow third parties to use to request and download customer utility bill and usage data. The overarching goal of the pilot is to demonstrate the potential of free, authorized access to standardized and automated energy usage data in accelerating the deployment of clean energy projects, while empowering customer choice and supporting local businesses. For the pilot, UtilityAPI will manage third party registration, data access authorizations, historical and ongoing data collection, and data cleaning and standardization to realize the data exchange platform. The platform includes an easy-to-use dashboard for small and local businesses, and a fully documented API for enterprise and app integration. On the back end, structured data stores and S3 buckets will be isolated for each utility and will not share resources, so only SVCE customer data is stored in a particular S3 bucket and structured data store.

Set-up:

Milestone 1: Pull in data from Calpine and successfully parse it into the structured storage format.

Milestone 2: Customers can authenticate themselves to load the dashboard and authorize Milestone 3: Customers can see scope of authorizations, and revoke Milestone 4: Changes are made to UtilityAPI settings page that allows third-parties to pull data
Milestone 5: SVCE-branded third party registration page Milestone 6: Ready for Beta program
Milestone 7: Ready for launch
Launch, Operations & Support:

End of setup through a 6-month term:

Task 1: Launch & maintain platform
Task 2: Promotion activities
Marketing by SVCE
Marketing by UtilityAPI
Task 3: Ongoing support, including biweekly reporting and check in Item 1g
Attachment 2
Agreement with Utility API, Inc.

DocuSign Envelope ID: A592005D-9393-4E3D-8864-16CEDD6984D2 12 Exhibit B
Schedule of Performance
Participant shall perform the services so as to complete each Project Deliverable according to the schedule set forth below. The time to complete each Deliverable may be increased or decreased by mutual written agreement of the Project Representatives for both Participant and Authority, so long as all work is completed within the Term of the Agreement.

Project Deliverables Completion Date
Milestone 1: Pull in data from Calpine and successfully parse it into the structured storage format. This includes setting up a firewall rule to whitelist access to only Calpine/SVCE/UtilityAPI IPs, and deleting stale data in the SFTP server as part of the sync script.

August 15, 2019
Milestone 2: Customers can authenticate themselves to load the dashboard and authorize
September 30, 2019
Milestone 3: Customers can see scope of authorizations, and revoke September 30, 2019 Milestone 4: Changes are made to UtilityAPI settings page that allows third-parties to pull data
October 15, 2019
Milestone 5: SVCE-branded third party registration October 31, 2019 Milestone 6: Ready for Beta program October 31, 2019
Milestone 7: Ready for launch January 1, 2020
Launch, Operations & Support, Task 1 / Launch and maintain platform
Monthly for 6-month
term starting at
platform launch and
beginning of software
license
Launch, Operations & Support, Tasks 2 & 3 / Promotion activities & Ongoing support
Monthly for 6-month
term starting at
platform launch and
beginning of software
license
Item 1g
Attachment 2
Agreement with Utility API, Inc.

DocuSign Envelope ID: A592005D-9393-4E3D-8864-16CEDD6984D2 13 Exhibit C
Compensation
The compensation to be paid to Participant under this Agreement for all services described in Exhibit “A” shall not exceed a total of two hundred and seventy-nine thousand dollars ($279,000), as set forth below. Any work performed for which payment would result in a total exceeding the maximum amount of compensation set forth herein shall be at no cost to Authority unless previously approved in writing by Authority. No reimbursable expenses are contemplated as a part of this Agreement.

Participant shall perform the categories of work and complete the Deliverables as outlined and budgeted below. Authority’s Party Representative may approve in writing the transfer of budget amounts between any of the Deliverables below, provided that the total does not exceed the not-to-exceed amount above.

Project Deliverables Completion Amount
Deliverable 1: Pull in data from Calpine and successfully parse it into the structured storage format. This includes setting up a firewall rule to whitelist access to only
Calpine/SVCE/UtilityAPI IPs and deleting stale data in the SFTP server as part of the sync script.
$26,000
Deliverable 2: Customers can authenticate themselves to load the dashboard and authorize
$13,000
Deliverable 3: Customers can see scope of authorizations, and revoke
Deliverable 4: Changes are made to UtilityAPI settings page that allows third-parties to pull data
$13,000
$26,000
Deliverable 5: SVCE-branded third party registration $13,000 Deliverable 6: Ready for Beta program $13,000
Deliverable 7: Ready for launch $13,000
Deliverable 8: Launch, Operations & Support, Task 1 /
Launch and maintain platform
Deliverable 9: Launch, Operations & Support, Tasks 2 & 3 / Promotion activities & Ongoing support
$22,500 each month, not to
exceed $135,000 in aggregate
over 6-month term
$4,500 each month, not to
exceed $27,000 in aggregate
over 6-month term
Total $279,000
Item 1g
Attachment 2
Agreement with Utility API, Inc.

DocuSign Envelope ID: A592005D-9393-4E3D-8864-16CEDD6984D2 14 Invoicing
In order to request payment, Participant shall submit invoices to the Authority upon completion of each Deliverable, describing the services performed and the applicable charges (including a summary of the work performed during that period, personnel who performed the services, hours worked, task(s) for which work was performed).

Advances
Upon written request by Participant, the Authority may, in its sole discretion, distribute to Participant an advance or advances meeting the following requirements:

1. Participant demonstrates that such advance(s) is required up front in order to undertake the Deliverable.

2. Participant submits invoices and receipts supporting the expenditures of an advance within 60 days of the payment by Authority. If complete invoices and receipts are not provided within 60 days, no further advances will be given.

3. At no time shall the total of all advances exceed 25% of the total amount of compensation.

4. No advance shall be provided for the final 10% of the total amount of compensation.

Additional Services
Participant shall provide additional services outside of the services identified in Exhibit A only by advance written authorization from Authority’s Chief Executive Officer prior to commencement of any additional services. Participant shall submit, at the Chief Executive Officer’s request, a detailed written proposal including a description of the scope of additional services, schedule, and proposed maximum compensation.

Item 1g
Attachment 2
Agreement with Utility API, Inc.

DocuSign Envelope ID: A592005D-9393-4E3D-8864-16CEDD6984D2 15 Exhibit D
Insurance Requirements and Proof of Insurance
Proof of insurance coverage described below is attached to this Exhibit, with Authority named as additional insured.

Participant shall maintain the following minimum insurance coverage:

A. COVERAGE:
(1) Workers' Compensation: Statutory coverage as required by the State of California.
(2) Commercial General Liability: Commercial general liability coverage with minimum limits of $1,000,000 per occurrence and $2,000,000 aggregate for bodily injury and property damage. ISO occurrence Form CG 0001 or equivalent is required.
(3) Automotive: Comprehensive automotive liability coverage with minimum limits of $1,000,000 per accident for bodily injury and property damage. ISO Form CA 0001 or equivalent is required.
(4) Professional Liability: Professional liability insurance which includes coverage for the professional acts, errors and omissions of Participant in the amount of at least $1,000,000.
(5) Cyber Coverage: Cyber Coverage with an aggregate limit of liability of one million dollars ($1,000,000.00).

B. ACCEPTABILITY OF INSURER: All insurance coverage shall be provided through carriers with AM Best’s Key Rating Guide ratings of A-:VII or higher which are licensed or authorized to transact insurance business in the State of California. Any and all subcontractors of the Participant retained to perform the services under this Agreement will obtain and maintain, in full force and effect during the Term of this Agreement, identical insurance coverage.

Item 1g
Attachment 2
Agreement with Utility API, Inc.

Page 1 of 2 ends

Staff Report – Item 1h
Item 1h: Adopt Resolution Amending SVCE Conflict of Interest Code to Add Multiple Positions From: Girish Balachandran, CEO
Prepared by: Kevin Armstrong, Administrative Services Manager Date: 2/9/2022

RECOMMENDATION
Adopt Resolution 2022-05 amending the SVCE conflict of interest code to add multiple positions in the list of designated positions for filing.

BACKGROUND
Shortly after the formation of SVCEA, the Board of Directors adopted a conflict-of-interest code as required by the Political Reform Act, commencing at Government Code Section 81000. The code lists the positions within the Authority that are required to file statements of economic interests (Form 700). As a joint powers authority with members located entirely within Santa Clara County, the County Board of Supervisors is the conflict code reviewing body that is required to approve all changes to the conflict-of-interest code. County Counsel has advised that when positions are added or removed from the conflict code, a new resolution must be adopted approving a new conflict of interest code with the added or removed position(s).

At the September 8, 2021 Board meeting, the Board of Directors adopted Resolution 2021-22 approving the creation of a personnel system to insure equitable and uniform policies and procedures for administering personnel matters in compliance with applicable laws; designating the Chief Executive Officer (CEO) as Personnel Officer; and delegating authority to the CEO to carry out all duties necessary to implement the personnel system.

ANALYSIS & DISCUSSION
Since the approval of the delegation of authority to CEO as Personnel Officer, the CEO has identified a need for various positions which fall under the approved personnel budget. Of these positions, SVCE staff and general counsel feel the following positions should report financial interests based on the decisions he/she will be making:

Designated Position Assigned Disclosure Category
Senior Manager of Public Sector Services 2
Senior Risk Manager 2
In accordance with the requirements of the Political Reform Act and the County of Santa Clara, a new conflict of interest code must be adopted by resolution which includes the newly created or identified positions as well as any changes to the existing Conflict of Interest Code. The attached resolution amends Appendix A to SVCE’s code to reflect the addition of the two new positions identified above. The remainder of the Conflict of Interest Code has not been changed.

STRATEGIC PLAN
Not applicable.

Item 1h

SILICON VALLEY

CLEAN ENERGY
Agenda Item: 1h Agenda Date: 2/9/2022

Page 2 of 2 ends

ALTERNATIVES
None.

FISCAL IMPACT
There is no fiscal impact as a result of adding positions to SVCE’s Conflict of Interest Code.

ATTACHMENT

1. Resolution 2022-05 Amending the Authority’s Conflict of Interest Code to Add Multiple Positions Item 1h
Resolution 2022-05 -1-
RESOLUTION NO. 2022-05

A RESOLUTION OF THE BOARD OF DIRECTORS OF THE SILICON VALLEY CLEAN ENERGY AUTHORITY AMENDING THE AUTHORITY’S CONFLICT OF INTEREST

CODE TO ADD MULTIPLE POSITIONS
WHEREAS, the Silicon Valley Clean Energy Authority (“Authority”) was formed on March 31, 2016 pursuant to a Joint Powers Agreement to study, promote, develop, conduct, operate, and manage energy programs in Santa Clara County; and WHEREAS, the Political Reform Act, Government Code Section 81000, et seq., (the “Political Reform Act”) requires each public agency in California, including the Authority, to adopt and promulgate a conflict of interest code; and WHEREAS, Government Code Section 87306 requires each public agency in California to amend its conflict of interest code when change is necessitated by a change in circumstances, including the creation of new positions and relevant changes to the duties assigned to existing positions; and WHEREAS, the Board of Directors of the Authority has adopted a conflict of interest code, and has amended this code as appropriate due to changed circumstances, with the most recent code adopted by Resolution 2021-15; and WHEREAS, the Board of Directors, after consultation with the County of Santa Clara as its code reviewing body, desires to amend the list of designated positions in Appendix A by amending multiple titles and adding multiple positions.

NOW, THEREFORE, BE IT RESOLVED that the Board of Directors of the Authority rescinds Resolution No. 2021-15 and adopts the following attached Conflict of Interest Code including its Appendices of Designated Positions and Disclosure Categories.

BE IT FURTHER RESOLVED that The Board of Directors of the Authority hereby directs the Secretary of the Board to coordinate the preparation of a revised Conflict of Interest Code in succeeding even-numbered years following notice and instructions from the County of Santa Clara as the code-reviewing body for the Authority, in accordance with the requirements of Government Code Sections 87306 and 87306.5. Future revisions to the Conflict of Interest Code should reflect changes in employee or official designations. If no revisions to the Code are required, the Authority shall submit a response as indicated in the instructions provided by the County of Santa Clara no later than October 1st of the same year, stating that amendments to the Authority’s Conflict of Interest Code are not required.

Item 1h
Attachment 1
Resolution 2022-05 -2-
ADOPTED AND APPROVED this 9
th day of February 2022, by the following vote:

Clerk
Item 1h
Attachment 1
Resolution 2022-05 -3-

SILICON VALLEY CLEAN ENERGY AUTHORITY

CONFLICT OF INTEREST CODE
The Political Reform Act (Government Code § 81000, et seq., hereinafter referred to as the Act) requires state and local government agencies to adopt and promulgate conflict of interest codes. The Fair Political Practices Commission (“FPPC”) has adopted a regulation (2 California Code of Regulations § 18730) which contains the terms of a standard conflict of interest code, which can be incorporated by reference in an agency’s code. After public notice and hearing, the standard code may be amended by the FPPC to conform to amendments in the Act. Therefore, the terms of 2 California Code of Regulations § 18730 and any amendments to it duly adopted by the FPPC are hereby incorporated by reference.

This regulation and the text here designating positions and establishing disclosure categories shall constitute the conflict of interest code of the Silicon Valley Clean Energy Authority (“Authority”).

The most current version of 2 Cal. Code of Regs. Section 18730 is available on the website of the Fair Political Practices Commission
(http://www.fppc.ca.gov/content/dam/fppc/NS-Documents/LegalDiv/Regulations/Index/Chapter7/Article2/18730.pdf).

Individuals holding a designated position shall file their Statements of Economic Interests with the Authority’s Filing Official, which will make the Statements available for public inspection and reproduction subject to Government Code section 81008. If Statements are received in signed paper format, the Authority’s Filing Official shall make and retain a copy and forward the original Statements to the Filing Officer, the County of Santa Clara Clerk of the Board of Supervisors. If Statements are electronically filed using the County of Santa Clara’s Form 700 e-filing system, both the Authority’s Filing Official and the County of Santa Clara Clerk of the Board of Supervisors will receive access to the e-filed Statements simultaneously.

Item 1h
Attachment 1
Resolution 2022-05 -4-

SILICON VALLEY CLEAN ENERGY AUTHORITY

CONFLICT OF INTEREST CODE
APPENDIX "A"

DESIGNATED POSITIONS
Designated Position Assigned Disclosure Category
Member of Board of Directors 1
Alternate Member of Board of Directors 1
Chief Executive Officer 1
Chief Financial Officer & Director of Administrative Services 1 Finance and Administration Committee Member 2
General Counsel 1
Energy Services Manager 2
Administrative Services Manager 2
Associate Legislative Analyst 2
Associate Manager of Decarbonization & Grid Innovation Programs 2 Associate Power Analyst 1
Associate Power Resources Planner 1
Communications Manager 2
Director of Account Services & Community Relations 2
Director of Decarbonization & Grid Innovation Programs 2 Director of Power Resources 1
Director of Regulatory & Legislative Policy 2
Financial Analyst 2
Management Analyst 2
Manager of Decarbonization & Grid Innovation Programs 2 Item 1h
Attachment 1
Resolution 2022-05 -5-
Policy Analyst 2
Power Analyst 1
Power Resources Manager 1
Power Resources Planner 1
Power Contracts & Settlements Manager 1
Power Settlements & Compliance Analyst 1
Principal Policy Analyst 2
Principal Power Analyst 1
Rates Manager 2
Senior Financial Analyst 2
Senior Government Affairs Manager 2
Senior Manager of Decarbonization & Grid Innovation Programs 2 Senior Manager of Public Sector Services 2
Senior Policy Analyst 2
Senior Power Analyst 1
Senior Power Resources Planner 1
Senior Rates Analyst 2
Senior Regulatory Analyst 2
Senior Risk Manager 2
Consultant 3
Newly Created Position *
* Newly Created Position
A newly created position that makes or participates in the making of governmental decisions that may foreseeably have a material effect on any financial interest of the position-holder, and which specific position title is not yet listed in the Authority’s conflict of interest code is included in the list of designated positions and shall disclose pursuant to the broadest disclosure category in the code, subject to the following limitation: The Chief Executive Officer of the Authority may determine in writing that a particular newly Item 1h
Attachment 1
Resolution 2022-05 -6-
created position, although a “designated position,” is hired to perform a range of duties that are limited in scope and thus is not required to fully comply with the broadest disclosure requirements, but instead must comply with more tailored disclosure requirements specific to that newly created position. Such written determination shall include a description of the newly created position's duties and, based upon that description, a statement of the extent of disclosure requirements. The Chief Executive Officer’s determination is a public record and shall be retained for public inspection in the same manner and location as this conflict-of-interest code. (Gov. Code Section 81008.) As soon as the Authority has a newly created position that must file Statements of Economic Interests, the Authority’s Filing Official shall contact the County of Santa Clara Clerk of the Board of Supervisors Form 700 division to notify it of the new position title to be added in the County’s electronic Form 700 record management system, known as eDisclosure. Upon this notification, the Clerk’s office shall enter the actual position title of the newly created position into eDisclosure and the Authority’s Filing Official shall ensure that the name of any individual(s) holding the newly created position is entered under that position title in eDisclosure.

Additionally, within 90 days of the creation of a newly created position that must file Statements of Economic Interests, the Authority shall update this conflict-of-interest code to add the actual position title in its list of designated positions and submit the amended conflict of interest code to the County of Santa Clara Office of the County Counsel for code-reviewing body approval by the County Board of Supervisors. (Gov. Code Section 87306.)
Item 1h
Attachment 1
Resolution 2022-05 -7-

SILICON VALLEY CLEAN ENERGY AUTHORITY

CONFLICT OF INTEREST CODE
APPENDIX "B"

DISCLOSURE CATEGORIES
Designated positions must report financial interests in accordance with the assigned disclosure categories.

Category 1: Persons in this category shall disclose:
(a) investments and business positions in business entities, and income (including gifts, loans, and travel payments) from sources that contract with the Authority, or that provide, plan to provide, or have provided during the previous two years, facilities, goods, technology, equipment, vehicles, machinery, or services, including training or consulting services, of the type utilized by the Authority; and (b) all interests in real property located: in whole or in part within the jurisdiction of the Silicon Valley Clean Energy Authority, or within two miles of the borders of any of the parties to the Joint Powers Agreement for the Authority, or within two miles of any land owned or used by the Authority.

Category 2: Persons in this category shall disclose investments and business positions in business entities, and income (including gifts, loans, and travel payments) from sources that contract with the Authority, or that provide, plan to provide, or have provided during the previous two years, facilities, goods, technology, equipment, vehicles, machinery, or services, including training or consulting services, of the type utilized by the Authority.

Category 3: Each Consultant, as defined for purposes of the Political Reform Act and applicable regulations1, shall disclose pursuant to the broadest disclosure category in the Authority’s conflict of interest code subject to the following limitation: The Chief Executive Officer of the Authority may determine in writing that a particular consultant, although a "designated position," is hired to perform a range of duties that are limited in scope and thus is not required to comply fully with the disclosure requirements of the broadest disclosure category, but instead must comply with more tailored disclosure requirements specific to that consultant. Such a written determination shall include a description of the consultant's duties and, based upon that description, a statement of the extent of 1 As defined in FPPC Regulation 18700.3, “consultant” means an individual who (1) makes governmental decisions, such as whether to approve a rate, rule, or regulation; to issue, deny, suspend, or revoke any permit, license, application, certificate or similar authorization; to adopt or approve a plan, design, report, study; or to adopt or approve policies, standards, or guidelines for the Authority; (2) serves in a staff capacity with the Authority, and in that capacity participates in making governmental decisions by providing information, an opinion, or a recommendation for the purpose of affecting the decision without significant intervening substantive review; or (3) performs the same or substantially all the same duties for the Authority that would otherwise be performed by an individual holding a designated position in this Code.

Item 1h
Attachment 1
Resolution 2022-05 -8-
disclosure requirements. The Chief Executive Officer’s written determination is a public record and shall be retained for public inspection in the same manner and location as this Conflict of Interest Code.

Item 1h
Attachment 1

Page 1 of 1 ends

Staff Report – Item 1i
Item 1i: Executive Committee Report
To: Silicon Valley Clean Energy Board of Directors
Prepared by: George Tyson, Chair of the Executive Committee Date: 2/9/2022
At the first meeting of the 2022 Executive Committee on January 28, Executive Committee members held annual appointments for Chair and Vice Chair; selected a regular meeting schedule; and voted to recommend a summer hiatus from July meetings.

CEO Girish Balachandran provided an update to the committee on upcoming items for the Board of Directors in February and March which included: SVCE rates, the first CC Power long-duration storage contract, the mid-year budget which will include the doubling down on decarb programs budget, and delegation of authority regarding commercial and industrial special contracts. CEO Balachandran addressed NEM 3.0 and provided an update on new personnel. Director of Power Resources, Monica Padilla, provided an update on the status of SVCE’s first newly constructed solar plus storage project.

The Committee also discussed NEM 3.0 in more detail.

The Committee appointed me as Chair, and Director Neysa Fligor as Vice Chair for 2022. A regular meeting schedule was established of the fourth Fridays of the month at 10:00 a.m., with the exception of the months of April and October, where the meetings will begin at 11:30 a.m. This schedule will allow all members to be in attendance.

Lastly, the Committee voted to cancel the regularly scheduled Executive Committee meeting on July 22, 2022. They also voted to recommend the Board of Directors approve cancelling the regularly scheduled Board of Directors meeting on July 13, 2022, which is on the consent calendar for the Board’s consideration.

Materials from the January 28, 2022 meeting can be found here: SVCE Executive Committee Meeting Materials, 1/28/22
The next meeting of the Executive Committee will be February 25, 2022 at 10:00 a.m.; materials will be posted no later than 72 hours in advance of the meeting.

Item 1i

SILICON VALLEY

CLEAN ENERGY

Page 1 of 1 ends

Staff Report – Item 1j
Item 1j: Finance and Administration Committee Report
To: Silicon Valley Clean Energy Board of Directors
Prepared by: Andrea Pizano, Board Clerk/Executive Assistant Date: 2/9/2022
No report as the Finance and Administration Committee has not met since December 16, 2021.

The next meeting of the Finance and Administration Committee is to be determined; materials will be posted no later than 72 hours in advance of the meeting.

Item 1j

SILICON VALLEY

CLEAN ENERGY

Page 1 of 1 ends

Staff Report – Item 1k
Item 1k: Audit Committee Report
To: Silicon Valley Clean Energy Board of Directors
Prepared by: Andrea Pizano, Board Clerk/Executive Assistant Date: 2/9/2022
No report as the Audit Committee has not met since August 18, 2021.

The next meeting of the Audit Committee is anticipated for February; materials will be posted no later than 72 hours in advance of the meeting.

Item 1k

SILICON VALLEY

CLEAN ENERGY

Page 1 of 1 ends

Staff Report – Item 1l
Item 1l: California Community Power Report
To: Silicon Valley Clean Energy Board of Directors
From: Girish Balachandran, CEO
Date: 2/9/2022
Per direction from the SVCE Board on December 9, 2020 for the CEO to provide a report of the ongoing activities of California Community Power (CC Power) after each of its meetings, this is to report CC Power held its regular board meeting on Wednesday, January 19, 2022.

Attached is a summary report from Interim General Manager Timothy Haines; materials from the regular board meeting can be found here on the CC Power website: CC Power Meeting, 1/19/22 The next meeting of the board will be March 16, 2022 at 1:00 p.m.; meeting materials can be found on the CC Power website: https://cacommunitypower.org/meetings/
ATTACHMENTS:

CA Community Power Board Meeting Summary from Interim General Manager Timothy Haines, January 19, 2022
Item 1l

SILICON VALLEY

CLEAN ENERGY
California Community Power
70 Garden Court, Suite 300, Monterey, CA 93940 | cacommunitypower.org A Joint Powers Agency whose members are:

Central Coast Community Energy | CleanPowerSF | East Bay Community Energy | MCE | Peninsula Clean Energy | Redwood Coast Energy Authority | San José Clean Energy | Silicon Valley Clean Energy | Sonoma Clean Power | Valley Clean Energy
TO: CC Power Board of Directors DATE: 1/19/2022
FROM: Tim Haines – Interim General Manager
SUBJECT: Report on CC Power Board of Directors Meeting – January 19, 2022 The CC Power Board of Directors held its normally scheduled meeting on Wednesday, January 19, 2022, via Zoom. Details on the Board packet, presentation materials, and public comment letters can be found under the Meetings tab at the CC Power website: https://cacommunitypower.org Highlights of the meeting included the following:
• Matters subsequent to posting the Agenda. None.
• Public Comment. There was no public comment on items not on the agenda. • Consent Calendar - The Board unanimously approved the following items:
o Minutes of the December 15, 2021 Regular Board Meeting o Resolution 22-01-01 Determination that Meeting in Person Would Present Imminent Risks to the Health or Safety of Attendees as a Result of the Proclaimed State of Emergency
• General Manager’s Report.
o Update on LDS Projects: Interim GM Haines informed the Board that negotiations continue with developers of additional Long Duration Storage projects and the intent is to bring them to the Board as soon as negotiations are complete. The Board was also informed there is no scheduled meeting in February. o Approval of Tumbleweed Project Agreements: Monica Padilla, SVCE Director of Power Resources, presented the Tumbleweed project and the associated agreements for the Board consideration. Members of the public spoke in support of the project. After clarifying questions Resolution 22-01-02 was moved and seconded. The Board unanimously approved the agreements and delegated the Interim GM to execute the agreements.
• Update on Firm Clean Resources Request for Offers: Jeanne Sole, SJCE Deputy Director, Power Resources, provided the Board with an update of the status of the FCR RFO.

Following the presentation, the Board considered and approved:
o Resolution 22-01-03 Approval of CC Power Non-disclosure and Exclusivity Agreement and
o Resolution 22-01-04 Approval of the Phase 2 Cost Sharing Agreement and authorization for General Manager to Execute with Participants. • Selection of Board Officers. The Board elected Geof Syphers, SCP, as Board Chair, Lori Mitchell, SJCE, as Vice Chair, Tom Habashi, 3CE, Treasurer and Brittany Iles, BBSW, as Secretary.

Item 1l
Attachment 1

Page 1 of 3 ends

Staff Report – Item 2
Item 2: CEO Report
To: Silicon Valley Clean Energy Board of Directors
Prepared by: Girish Balachandran, CEO
Date: 2/9/2022
Item 2
REPORT
SVCE Staff Update
Aidas Baublys joined SVCE January 31, 2022 as a Senior Financial Analyst in the Finance and Administration group. Aidas comes to us from the New York Power Authority (NYPA) where he worked as a Senior Analyst in the Financial Planning and Analysis group. At NYPA, Aidas built and maintained financial forecasting and budgeting models. His experience also includes working at Akayi Capital Partners where he analyzed the viability of 17 renewable energy projects, and Starwood Hotels where he worked in the revenue strategies and analytics function. Aidas also worked at Creditsights assessing the credit risk of companies in the airlines and maritime shipping industry. Aidas has an MBA from University of Bridgeport, Bridgeport CT and a BS in Electrical Engineering and Engineering Economy from Kaunas University of Technology, Kaunas, Lithuania.

Personnel Officer Update
Personnel additions have continued through the winter, bringing SVCE's current FTE headcount to 29, seven greater than the low of 22 we were at in September. Included in those seven new hires are a new Energy Services Lead, Peter Mustacich, who started on Jan 10th. On Jan 31st, the Finance and Admin team added Aidas Baublys as Senior Financial Analyst. And in mid-February, we look forward to hitting 30 FTEs, when Tony Eulo joins the Account Services and Community Relations Team as a Senior Public Sector Services Manager. In staff transitions, Karthik Rajan, our Principal Power Analyst, has accepted a transfer to a new role, that of Senior Risk Manager, splitting duties between the Power Resources and Finance & Admin Teams. Staff continues to finalize job descriptions for additional positions, including an HR Generalist, a Compliance Manager, and Quantitative roles to help with risk management. On the benefits front, SVCE has reduced the window for benefits enrollment, in order to better compete in a tight job market and aid new employees with their transitions. New employees will now be eligible on the first of the month following their hire, removing an additional 30-day waiting period.

CEO Agreements Executed
The following agreements have been executed by the CEO, consistent with the authority delegated by the Board:
1) Granicus, Amendment: Software as a service, additional $44,595.48 added, extends to 12/31/22

SILICON VALLEY

CLEAN ENERGY

Page 2 of 3 ends

CEO Power Supply Agreements Executed
Transaction Counterparty Name Execution/Effective Date Transaction Type Product Start Date End Date Notional Value Link Transaction 1 Peninsula Clean Energy 12/17/2021 Sale Resource Adequacy 3/1/2022 3/31/2022 $92,625.00 Transaction 2 Transaction 2 Peninsula Clean Energy 12/17/2021 Purchase Resource Adequacy 3/1/2022 3/31/2022 $50,375.00 Transaction 1 Direct Energy 1/13/2022 Sale Resource Adequacy 3/1/2022 3/31/2022 $135,000.00 PG&E 12/12/2021 Allocation Carbon-Free 1/1/2022 12/31/2022 $0.00 These agreements are included in the Board packet as Appendix A.

Item 2

SILICON VALLEY

CLEAN ENERGY

Page 3 of 3 ends

Presentations & Relevant Meetings Attended by CEO
- Participated in CalCCA Monthly board, executive, and legislative meetings; - Long-Duration Storage Super-JPA and RFO: Updates to various CCAs, CPUC, CAISO and legislative staff - CC Power Board Meeting, January 19th, report included on the Consent Calendar - Energy Storage News Interview, Feb. 3, 2022 (CEO Balachandran and Director of Power Resources Monica Padilla)

ATTACHMENTS

1. Decarb & Grid Innovation Programs Update, February 2022

2. Account Services & Community Relations Update, February 2022

3. Legislative and Regulatory Update, February 2022

4. Agenda Look Ahead, February – June 2022

5. Board Action Requested, February 2022 Update
Item 2

SILICON VALLEY

CLEAN ENERGY

DECARBONIZATION & GRID INNOVATION

PROGRAMS UPDATE

FEBRUARY HIGHLIGHTS
The SVCE Community Resilience Program
provides a total of $5 million in grant funding
and technical resources distributed to member
agencies to support increased energy
resilience at critical community facilities during
grid outages.

The City of Milpitas used grant funding to
support a solar array and battery storage
system at the Community Center and Barbara
Lee Senior Center to increase energy resilience
at these key city facilities.

Projects increase economic recovery,
community resilience and decarbonization. If
you would like to learn more, visit:
svcleanenergy.org/resilience
Milpitas Solar+Battery Storage Resilience Project
SVCE published the EV and EV Infrastructure (EVI) Baseline Study which highlights key findings of where EV adoption is strongest and where it still needs to grow in the SVCE service area. The report also identifies where and how charging infrastructure is being used.

Find the study here: svcleanenergy.org/research-analysis New Electric Vehicle Infrastructure Baseline Study
Reach Codes 2.0 - The Sequel
SVCE jurisdictions led the way in passing electrification and EV reach codes in the 2019 code cycle. These codes need to be re-upped by October 2022 to remain in effect. In addition to nuts and bolts code adoption support, Reach Codes 2.0 includes resources for permitting simplification and electric retrofits of existing buildings to continue to advance our community's climate goals.

Milpitas resilience project

SILICON VALLEY

CLEAN ENERGY
Item 2
Attachment 1
Decarbonization & Grid Innovation Programs Update, Feb. 2022 08/21 9/21 10/21 11/21 12/21 1/22
1,000
750
500
250
0 Cumulative HPWH Installations
= 25 Single-Family Projects
= 1 Multi-Family Property Project
(Number of households varies)
Goal: 220 HPWH by 2022
Funding: $1.15M
ONGOING METRICS FEBRUARY 2022
Heat Pump Water Heater
Provide incentives for electric heat pump water heaters and service panel upgrades to residents using gas or
electric resistance heaters
= 10 Completed Installations
Single-Family Multi-Family
Lights On Silicon Valley
Provide incentives for enrolling solar and battery
systems in the SVCE grid services program
750 Single-Family + 5
Multi-Family Projects
Completed by 2023
Goal:

Funding: ≤ $7.4M
H
o
u
s
e
h
old
s
S
u
p
p
ort
e
d
Cumulative Service Panel Upgrades = 1 CARE/FERA Installation 7/19
9/19
1 /19
1/20
3/20
5/20
7/20
9/20
1 /20
1/21
3/21
7/21
9/21
1 /21
1/2
250
200
150
100
50 0
Item 2
Attachment 1
Decarbonization & Grid Innovation Programs Update, Feb. 2022 CALeVIP
Level 2 DCFC
$6M
$4M
$2M
$0M
Reserved
9/21 10/21 11/21 12/21
150
100
50 0
ONGOING METRICS FEBRUARY 2022
Provide incentives for electric vehicle (EV) chargers
as part of a regional program
= 25 Level 2 Installations
Goal: 150 Participants (Phase 1)
Funding: $1.5M
Participants Installations
FutureFit Fundamentals
Provide financial relief to contractors by
expanding their knowledge of electrification
technologies
1K Level 2 + 85 DC Fast
Chargers by 2023
Goal:

Funding: $11.58M
= 5 Participants Complete Course
= 5 DCFC Installations
Waitlisted
Installed
To be released in
future years
$4.08M*
$6M
$1.5M
*$1.5M of the reserrved funding is undering a final review and validation. **********
**********
**********
**********
wwwwwwww
*
w
Item 2
Attachment 1
Decarbonization & Grid Innovation Programs Update, Feb. 2022 Streamlining Community-Wide Electrification
Building Decarb Joint Action Plan
Resilience at Community Facilities
CRCR Bill Relief
FutureFit Homes & Buildings
Regional Coordination
Click for More Information Active In Development Complete C&I Clean Power Offerings
Reach Codes
All-Electric Showcase Grants
FutureFit Heat Pump Water Heater
FutureFit Fundamentals
Accessible Financing
Local Policy to Decarbonize Existing Buildings
Feasibility Assessment - Natural Gas Phase Out By 2045
EV Infrastructure Strategy & Plan
CA Electric Vehicle Infrastructure Project (CALeVIP)
Priority Zone DCFC
MUD Technical Assistance
Fleet Electrification Grants
SV Transportation Electrification Clearinghouse (SVTEC) Regional Recognition
Virtual Power Plant
Customer Resource Center (eHub)
Community Engagement Grants
Innovation Partners
Innovation Onramp
UtilityAPI
EVmatch
Ecology Action
ev.energy
Span.IO
Outthink
Electron
Stanford
PROGRAMS AT A GLANCE FEBRUARY 2022
POWER
SUPPLY
GRID

INTEGRATION

EDUCATION

OUTREACH
Extensible Energy / Community Energy Labs
BUILT

ENVIRONMENT

MOBILITY

INNOVATION
NeoCharge
XeroHome
dShift
Item 2
Attachment 1
Decarbonization & Grid Innovation Programs Update, Feb. 2022 SVCE is supporting and engaging in events, meetings and conferences allowing us to continue sharing information and resources with the community and broader industry stakeholders.

January 18 7 - 9 PM
SVCE Power Supply & Programs
Update to Sunnyvale Sustainability
Commission
Virtual
February 9 12 – 1 PM
Drive Clean Bay Area EV 102 for new
EV Drivers – Virtual
February 12 1 – 3 PM EV Showcase Event – Los Altos High School February 18 9 AM – 12
PM
Joint Venture Silicon Valley – State of
the Valley -
Stanford University
and Virtual (hybrid)
Item 2
Attachment 2
Acct Svcs & Comm Relations Update, Feb. 2022

1. Outreach Events & Sponsorships
Date Time Description Location I
sponsorship and
presenting
tabling
Mountain View Tree Lighting 2021
sponsorship

SILICON VALLEY
CLEAN ENERGY 1
Residential 96.37%

96.37%
Commercial 96.37%
Item 2
Attachment 2
Acct Svcs & Comm Relations Update, Feb. 2022

2. Customer Participation
Participation Rate Overall Participation Rate

SILICON VALLEY
CLEAN ENERGY 2
The following agenda items were presented and discussed:
• Member Agency Roundtable Updates
• CALeVIP Update
• TECH On-Bill Financing Pilot & Reach Code EM&V Data Request • Reach Codes 2.0
• NEM Successor Tariff Update
Item 2
Attachment 2
Acct Svcs & Comm Relations Update, Feb. 2022

3. Member Agency Working Group January Update
The recent MAWG meeting was held virtually on January 27, 2022, and was attended by 10 different agencies and organizations with a total of 22 participants.
0 SILICON VALLEY
CLEAN ENERGY 3
• Northern and Central California Community Choice Aggregators Issue Joint Request for Proposals for New Clean Energy Sources, •
• EVmatch and Silicon Valley Clean Energy Partnering to Address Electric Vehicle Charger Accessibility in Santa Clara County • Seven California Community Power Members Contract for 69 Megawatts of Long Duration Energy Storage
•
Item 2
Attachment 2
Acct Svcs & Comm Relations Update, Feb. 2022

4. Latest SVCE News & Media
SV Clean Energy $ @SVCIeanEnergy • Jan 26
(1/2) Seven California Community Power Members Contract for 69 Megawatts of Long Duration Energy Storage.

Press release: svcleanenergy.org/news/seven-cal... @CleanPowerSF ©PenCleanEnergy @redwood_energy @sjcleanenergy @SonomaCleanPow @VCIeanEnergy
0 Press Release, 01-07-22

R N I A

UNITY P
SV Clean Energy Brings EV Drivers a New Wav to Charge with Cheaper. Cleaner Electricity. Press Release, 01-10-22
, Press
Release, 01-18-22 svcleanenergy.org
Seven California Community Power Members Contract for 69 Megawa...

Project marks first major procurement milestone for CCA Joint Powers Agency Monterey,Calif.-At the January19 California Community...

Q i tl 6 Z> 15 £
, Press Release, 01-26-
SV Clean Energy 0 @SVCIeanEnergy • Jan 26
(2/2) The agreement is for 69 MW/552 MWh of long-duration energy storage.This project marks first major procurement milestone for the CCA Joint Powers Agency and will help the CCAs meet CPUC Mid-Term Reliability Procurement order.
22 0
Campbell and Los Altos Hills Representatives Elected to Lead Local Energy Agency. Press Release, 01-31-22
o tl 1 O 5 LL
4 • ‘Community Choice’ raises $2.2 billion with clean energy bonds in California
• Financial JPA Issues $2B in Power-Purchase Bonds Aiding Three CCAs
• San Rafael Chamber: CCCFA Issues California's First Municipal Clean Energy Project Revenue Bonds Worth Over $2 Billion • California Community Choice Financing Authority’s $1.5 Billion Notes Offering, Global Legal Chronicle
• Project update: Construction underway on the 100 MW/50 MWh Rabbitbrush Solar project
• California Community Choice Aggregators Seek Clean Energy Supply Proposals
Item 2
Attachment 2
Acct Svcs & Comm Relations Update, Feb. 2022

5. Media
, Impact Alpha, 12-09-21
t1. You Retweeted
CaICCA @cal_cca • Jan 10
Three CCAs are soliciting proposals to develop clean energy sources to meet California's mid-term reliability procurement mandate in addition to RPS, GHG emissions reductions and reliability requirements. @3CE @SVCIeanEnergy @SonomaCleanPow
publicpower.org/periodical/art...
, Energy News Data, 12-10-21
Patch.com, 12-16-21
California Community Choice
Aggregators Seek Clean Energy
Supply Proposals
, 12-18-21
8JvMsry 7.KC*
£> ftulGnrrtx
*
, PV Magazine, 01-06-22 o ta 3
•8
, American Power Public Association, 01-07-22
5 • How Much Did Residents Reduce Emissions By In 2021? • Charging less for charging EVs
• Quick Bites: Energy News Roundup
• EVmatch, Silicon Valley Clean Energy to Address EV Charger Accessibility in Santa Clara County, CA •
• 7 California CCAs sign on for nearly 70-MW long-duration energy storage project •
• California Community Power members procure 69MW of long-duration storage • Town Of Los Gatos: DIY Home Energy Toolkits Available At The Los Gatos Library • Lithium-ion batteries beat novel long-duration tech in California contest Item 2
Attachment 2
Acct Svcs & Comm Relations Update, Feb. 2022

5. Media
, Patch.com - Campbell, Cupertino, Gilroy, Los Gotos,
01-10-22
J
The Mercury News, Community Briefs - Campbell, Cupertino, Los Gotos, Milpitas, Saratoga, Sunnyvale, 01-16-22
, Californio Energy Markets, 01-14-22
, Autobody
News, 01-18-22
+3 more articles
, Solar Power World, 01-26-22
+19 more articles
, PV Magazine, 01-26-22
, Potch.com, 01-26-22
, Canary Medio, 01-27-22
6 • Eight-hour lithium-ion project wins in California long-duration energy storage procurement Energy Storage News, 01-27-22
• Quick Bites: Energy News Roundup,
• California Battery Storage Surges With New Projects and Contracts, • California Community Choice Aggregators Enter Into Storage Service Agreement, • Check out DIY Energy Saving Toolkits at Los Gatos Library, • Seven California CCAs Sign On for Long-Duration Energy Storage, • In the New World of Long-Duration Battery Storage, an Old Technology Holds Its Own, Item 2
Attachment 2
Acct Svcs & Comm Relations Update, Feb. 2022

5. Media
Californio Energy Markets, 01-28-22
Californio Energy Markets, 01-28-22
American Public Power
Association, 01-29-22
The Mercury News, 01-30-22
Smart Energy Decisions, 01-21-22
Inside Climate News, 02-
03-22
7 Item 2
Attachment 3
Leg and Reg Update, Feb. 2022
SVCE Legislative and
Regulatory Update
February 9, 2022
Item 2
Attachment 3
Leg and Reg Update, Feb. 2022
CD Policy Updates
Legislative Update:

1. Governor's January Budget Proposal
2 CaICCA-sponsored bill on Transportation
Electrification Program
Regulatory Update:

1. Power Charge Indifference Adjustment (PCIA)

2. Electricity Planning and Procurement

1. Integrated Resource Planning (IRP)

2. Resource Adequacy (RA)

3. Net Energy Metering (NEM)
2 Item 2
Attachment 3
Leg and Reg Update, Feb. 2022
Item 2
Attachment 3
Leg and Reg Update, Feb. 2022
PCIA: 2022 Rate Implementation Is Expected March 1
The ERRA Forecast Proceeding sets the generation rate for PG&E customers and the Power Charge Indifference Adjustment (PCIA) for all customers.

Implementation of the new rates
The bundled generation rate for PG&E customers is going to increase substantially ( 33%).

The PCIA is going to decrease substantially ( 58%).

These changes offset some of the negative impacts of the 2021 rates.

Next Steps: CPUC is scheduled to vote on the decision on February 10th. If adopted, the new rates are targeted to be included in SVCE customer March bills.
4 Item 2
Attachment 3
Leg and Reg Update, Feb. 2022
PCIA: Allocation of RPS Resources to CCA’s is
Underway
In May 2021, the CPUC granted CCA's access to legacy RPS resources beginning in 2023.

Implementing the new PCIA rules
Q1 2022: PG&E will work with the CCA’s to finalize the contract and allocation share Next Steps:Staff is analyzing whether or not to accept the allocation, and, if yes, whether all or a portion should be accepted.
5 • •
•
•
•
Item 2
Attachment 3
Leg and Reg Update, Feb. 2022
Electricity Planning and Procurement: New rules imposed and more changes expected
Procurement obligations continue to evolve throughout 2022 Newsom’s 2021
Emergency Proclamation
Orders energy agencies to
ensure energy supply meets
demand in extreme events
New Reliability Rules in
Development in 2022
CPUC is restructuring its
Resource Adequacy program
New Procurement
Mandates in 2021
LSEs must procure 11,500 MW
of new electricity by 2026
SVCE is responsible for
and making progress
towards procuring 237
MW
lOUs must have 2000 -3000
MW to be online by summer
2022 and summer 2023
6 •
•
•
•
Item 2
Attachment 3
Leg and Reg Update, Feb. 2022
IRP: CPUC considering additional measures to
enhance summer reliability during 2022-23
Integrate Resource Planning (IRP) is a process to ensure that the electricity sector is on track to meet its portion of the State9
s GHG reduction and reliability goals.

New procurement mandate for utilities to meet summer needs December 2021: CPUC adopted new requirements to meet 2022-2023 summer reliability, which Orders PG&E to procure demand and supply-side resources of 900 -1,350 MW to meet summer reliability needs.

Procurement costs will be recovered via IOU and CCA customers through rates.

Expands use of a central procurement entity to procure reliability resources located in local areas.

Encourages accelerated online dates for procurement ordered by previous mandates.

Expands the Emergency Load Reduction Program (ELRP), where customers reduce usage during times of high grid stress, to residential customers and increases the incentive from $1 to $2/kWh to increase participation.

Next steps: The utilities begin implementation of new requirements. SVCE staff is also planning for its 2022 IRP filing due in September.
7 •
•
Item 2
Attachment 3
Leg and Reg Update, Feb. 2022
RA Program: Reform of the RA Program is underway
Resource Adequacy (RA) is a program developed to ensure that there will be sufficient resources available to serve electric demand under most conditions.

Resource Adequacy reform
January 2022: Six months of stakeholder workshops concluded.

Two main proposals have been proposed during the Workshops that have different impacts on the SVCE portfolio.

Workshops focused on different aspects of the proposals.

Next steps:Staff analyzing proposals to assess impacts on portfolio. A proposed decision expected in Q2 2022.
8 •
•
•
•
•
•
Item 2
Attachment 3
Leg and Reg Update, Feb. 2022
NEM: CPUC proposes major revisions to the program
Net Energy Metering (NEM) compensates customers who generate their own electricity, predominately from rooftop solar, to serve their onsite electricity needs.

Proposed NEM successor tariff
December 2021: CPUC issued a proposed decision establishing a new tariff revising the NEM program, which:

Reduces the NEM compensation from the retail rate ( 25 cents/kWh) to a rate based on the “avoided cost” of generation (~5 cents/kWh).

Establishes a new monthly "Grid Participation Charge" (averaging $40 - 50/month for typical installation).

Compensates new NEM customers with a “Market Transition Credit” of $5.25/month per kW of solar installed, declining 25%/year.

Exempts low-income customers from grid connection fees.

January 2022: SVCE staff issued a letter to the CPUC
Staff expressed concern with the Grid Participation Charge which would only be imposed on NEM customers.

Staff expressed support for the CPUC’s aim to encourage electrification, adoption of solar+storage and more access to solar in low-income communities.

Next Steps: The CPUC withdrew its proposed decision from its meeting agenda. Staff is expecting a revised proposed decision from the assigned Administrative Law Judge or an Alternate Proposed Decision from a commissioner in the future. 9
Item 2
Attachment 3
Leg and Reg Update, Feb. 2022
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|
~ 63 Sj |e} Aj 3
Item 2
Attachment 3
Leg and Reg Update, Feb. 2022
CD 2022 Governor’s January Budget
Governor prioritizing climate investments,including these highlights:

Program Amount of Funding Notes
$380 million (over 2
years)
$45 million (over 2
years)
Long Duration Storage Support “projects throughout the state.” Offshore Wind Establishes new Offshore Wind Deployment Facility Improvement Program to help with investment plans,
engineering and environmental review, and cost-share funding for federal grants.
$300 million (over 2 Rebates for building upgrades
years)
ZEV Fueling Infrastructure $900 million (over 5
years)
Community-based plans $419 million
and Sustainable
Community Strategies
Building Decarb -
Consumer Rebates
Low-income neighborhood infrastructure
Grants
Increasing access in low-income communities, clean mobility options, sustainable/equitable transportation projects, and established community mobility plans.
11 •
•
Item 2
Attachment 3
Leg and Reg Update, Feb. 2022
(
^
)
CaICCA sponsoring Transportation
Electrification Bill
Assemblymember Grayson authoring the bill.

New Transportation Electrification Bill
CaICCA-sponsored bill would explicitly authorize CCAs to administer transportation electrification program funds at the CPUC.

This authorization is similar to what already exists for energy efficiency programs. 12 SVCE Agenda Planning, February - May 2022
FEBRUARY 2022 MARCH 2022 APRIL 2022 MAY 2022
Board of Directors, February 9: Board of Directors, March 9:

Consent:

Minutes
January 2022 Treasurer Report
Zglobal Agreement
Regular Calendar:

Financial Audit Results
Midyear Budget
eHub Year 1 Recap & Survey Results
"Double Down" on Decarb Programs
CC Power LDS Contract #2
Board of Directors, April 13:

Consent:

Minutes
February 2022 Treasurer Report
Regular Calendar:

TBD
Board of Directors, May 11:

Consent:

Minutes
March 2022 Treasurer Report
Regular Calendar:

TBD
Executive Committee, February 25:
eHub Year 1 Recap & Survey Results
"Double-Down" on Decarb Programs
Executive Committee, March 25:

Reach Codes 2.0 Update
Update on Programs Equity Framework
Executive Committee, April 22:

TBD
Executive Committee, May 27:

TBD
Audit Committee, TBD:

Receive Audit Results
Finance & Administration Committee (Mar/Apr TBD):

TBD
Revised 2/3/22
Item 2
Attachment 4
SVCE Board Action Requested - February Update
Date Meeting Where Requested Request/Comment Comments Department 1/28/2022 Executive Committee Request for information re: solar plus storage incentives (Dir. Ellahie) Staff has reached out to Dir. Ellahie with information on SVCE's program with Sunrun which offers customers a
$500 rebate Account Services & Comm
8/11/2021 Board Meeting
Power Supply Contract with the California Community Choice Financing Authority. Note: Under discussion, Director Wiley asked if it would be advantageous to have periodic check-ins to assure that the Board was satisfied with results. CEO Balachandran stated he would take that as an action item to the Finance Committee and bring it back to the Board for discussion. Staff is keeping this in mind as we plan for future agenda items Finance & Admin
5/12/2021 Board Meeting
Training request on how to manage a potential new working environment and check-in 6 months to 1 yr after implementation of a possible hybrid work structure Staff will keep this in mind as a policy is developed Executive 3/3/2021 Audit Committee SVCE liability insurance - is it a sufficient amount? (Alt. Dir. Wei) Staff will consider this when looking at overall risk
mitigation Finance & Admin
8/28/2020 Executive Committee
Policy check regarding duration of contracts before they go back out to bid (Dir. Gibbons)
Purchasing Policy does not currently have a formal
duration limit; will update Purchasing policy pending
discussion with CFO Finance & Admin
2/2/22
Item 2
Attachment 5

Page 1 of 3 ends

Staff Report – Item 3
Item 3: Appoint 2022 Board Committee Members
From: Girish Balachandran, CEO
Prepared by: Andrea Pizano, Board Clerk/Executive Assistant Date: 2/9/2022

RECOMMENDATION
Staff recommends the Board appoint members to the 2022 Legislative and Regulatory Ad Hoc Committee, Audit Committee, and Finance and Administration Committee through February 2023.

BACKGROUND
SVCE’s Joint Powers Authority Agreement, Article 4, Section 4.7 Commissions, Board and Committees, states, “The Board may establish any advisory commissions, boards, and committees as the Board deems appropriate to assist the Board in carrying out its functions and implementing the CCA Program, other energy programs and the provisions of this Agreement.” Per SVCE’s Operating Rules and Regulations, the term of office for each committee established by the Board shall be one year. There are no limits on the number of terms that a Director may serve on a committee.

ANALYSIS AND DISCUSSION
Legislative and Regulatory Ad Hoc Committee
This Ad Hoc Board Committee was formed on January 12, 2022 to address the following priorities:
• Expansion of Direct Access
• Reliability Planning and Procurement
• Transparency and Accountability in Ratemaking
• Public Safety Power Shutoffs & Wildfire Prevention and Cost Recovery • Affordability and Equity
• Decarbonization
The committee meets as needed (based on member availability), and is comprised of up to six Directors or Alternate Directors of the Board. An alternate Director may not attend a Committee meeting on behalf of an absent regular Director. No more than one Committee member shall represent a particular member agency.

Composition Expressed Interest for 2022
• Not more than six Directors/Alternate Directors of the Board (6 total)
• No more than one eligible Committee Member shall represent their respective Member Agency
• Alternates to appointed committee members is prohibited

1. Dir. Liz Gibbons, Campbell

2. Dir. Zach Hilton, Gilroy

3. Dir. Rob Rennie, Los Gatos

4. Dir. Yvonne Martinez Beltran, Morgan Hill

5. Dir. Margaret Abe-Koga, Mountain View

6. Dir. Gustav Larsson, Sunnyvale
Item 3

SILICON VALLEY

CLEAN ENERGY
Agenda Item: 3 Agenda Date: 2/9/2022

Page 2 of 3 ends

Audit Committee
The purpose of the Audit Committee is to oversee the accounting and financial reporting process and the audit of SVCE’s financial statements by the independent auditor. The Audit Committee meets twice a year and as needed, is comprised of a minimum of three and up to six Directors or Alternate Directors of the Board, and no more than one eligible committee member shall represent their respective member agency.

Composition 2021 Roster Expressed Interest for 2022
• Minimum of three and no more
than six Directors of the Board or
appointees by the Board (3-6
total)
• Board Members, Alternate Board
Members, and member agency
staff nominated by a Board
Member can serve
• No more than one eligible
Committee Member shall
represent their respective Member
Agency
• Alternates to appointed committee
members is prohibited

1. Committee Chair Bryan
Mekechuk, Monte Sereno

2. Committee Vice Chair Hung Wei,
Cupertino

3. Dir. Evelyn Chua, Milpitas

4. Dir. Yvonne Martinez Beltran,
Morgan Hill

1. Alt. Dir. Bryan Mekechuk, Monte
Sereno

2. Dir. Margaret Abe-Koga,
Mountain View

3. Alt. Dir. Sergio Lopez, Campbell

4. Vickie Rahman, Finance Analyst,
Gilroy *City of Gilroy Staff
Member nominated by Dir. Hilton
Finance and Administration Committee
The purpose of the Finance and Administration Committee is to provide financial and administrative oversight of SVCE. Tasks include budgeting, financial reporting, monitoring of internal controls, review financial and administrative policies and oversee investment strategies. The Finance and Administration Committee meets quarterly and as needed, is comprised of up to six Directors or Alternate Directors of the Board, a minimum of three Directors or Alternate Directors, and no more than one eligible committee member shall represent their respective member agency.

1. Committee Chair Rob Rennie,
Los Gatos

2. Committee Vice Chair Bryan
Mekechuk, Monte Sereno

3. Dir. Liz Gibbons, Campbell

4. Dir. Yvonne Martinez Beltran,
Morgan Hill

5. Dir. Larry Klein, Sunnyvale

1. Dir. Liz Gibbons, Campbell

2. Alt. Dir. Hung Wei, Cupertino

3. Dir. Rob Rennie, Los Gatos

4. Alt. Dir. Bryan Mekechuk, Monte
Sereno

5. Dir. Margaret Abe-Koga,
Mountain View

6. Dir. Larry Klein, Sunnyvale
Item 3
Agenda Item: 3 Agenda Date: 2/9/2022

Page 3 of 3 ends

Attached are two documents: 1) the 2022 Committee Matrix Worksheet which summarizes who served on these respective committees in 2021 and who has expressed interest for 2022, and 2) a visual snapshot of the proposed 2022 committee assignments for SVCE.

STRATEGIC PLAN
Not applicable.

ALTERNATIVE
There is no alternative to selecting members of SVCE’s committees.

FISCAL IMPACT
No fiscal impact as a result of selecting SVCE’s committee members.

ATTACHMENTS

1. 2022 Committee Matrix Worksheet

2. 2022 Proposed SVCE Committee Assignments
Item 3
2022 Committee Matrix Worksheet
Committee Description 2021 Roster Interest in serving for 2022

Finance & Administration Committee •Rob Rennie (Chair)
•Bryan Mekechuk (Vice Chair)
•Yvonne Martinez Beltran
•Liz Gibbons
•Larry Klein
Emily Lo
Audit Committee
2022 Legislative and Regulatory Ad
Hoc Committee
This Ad Hoc Board Committee was formed on
January 12, 2022 to address the following priorities:
•Expansion of Direct Access
•Reliability Planning and Procurement
•Transparency and Accountability in Ratemaking
•Public Safety Power Shutoffs & Wildfire Prevention
and Cost Recovery
•Affordability and Equity
•Decarbonization
Makeup: This committee will consist of no greater
than six members. An alternate Director may not
attend a Committee meeting on behalf of an absent
regular Director. No more than one Committee
member shall represent a particular member agency.

The Audit Committee works with SVCE staff on the
initiation and receiving of the annual audit.

Makeup: The Audit Committee consists of no fewer
than three members and no greater than six members,
and can be Board members, Alternate Board
members, or a Board appointed Agency staff member.

An alternate Director may not attend a Committee
meeting on behalf of an absent regular Director. Not
more than one Committee member shall represent a
particular member agency.

The Finance and Administration Committee works
with SVCE staff on items related to financial and
administrative issues that impact the agency.

Makeup: The Finance & Administration Committee
consists of no fewer than three members and no
greater than six members, and can be Board
members, Alternate Board members, or a Board
appointed Agency staff member. An alternate
Director may not attend a Committee meeting on
behalf of an absent regular Director. Not more than
one Committee member shall represent a particular
member agency.

N/A
•Dir. Liz Gibbons, Campbell
•Alt. Dir. Hung Wei, Cupertino
•Dir. Rob Rennie, Los Gatos
•Alt. Dir. Bryan Mekechuk, Monte Sereno
•Dir. Margaret Abe-Koga, Mountain View
•Dir. Larry Klein, Sunnyvale
Meeting Details
Time: TBD
Frequency: As needed
Location: Virtual
Time: TBD
Frequency: Quarterly & as needed
Location: Virtual
Time: TBD
Frequency: Twice yearly & as
needed
Location: Virtual
•Bryan Mekechuk (Chair)
•Hung Wei (Vice Chair)
•Evelyn Chua
•Yvonne Martinez Beltran
•Dir. Liz Gibbons, Campbell
• Dir. Zach Hilton, Gilroy
• Dir. Rob Rennie, Los Gatos
• Dir. Yvonne Martinez Beltran, Morgan Hill
• Dir. Margaret Abe-Koga, Mountain View
• Dir. Gustav Larsson, Sunnyvale
• Alt. Dir. Sergio Lopez, Campbell
• Vickie Rahman, Finance Analyst, Gilroy
• Alt. Dir. Bryan Mekechuk, Monte Sereno
• Dir. Margaret Abe-Koga, Mountain View
Draft 2022 Committee Matrix Worksheet February 3, 2022
Item 3
Attachment 1

SILICON VALLEY

CLEAN ENERGY
2022 SVCE Assignments and Committee Interests
Director Agency
Executive Committee
5 Members
2022 Leg and Reg Ad Hoc
Committee
Meets as needed
6 Interested Members
Audit Committee
Meets Twice Yearly & as
needed
4 Interested Members
Finance and Administration
Committee
Meets Quarterly & as
needed
6 Interested Members
Liz Gibbons, Chair Campbell ● ✅ ✅
Sergio Lopez
Campbell
(Alternate Director) ✅
George Tyson, Vice Chair Town of Los Altos Hills ●
Jon Willey City of Cupertino
Hung Wei
City of Cupertino
(Alternate Director) ✅
Zach Hilton City of Gilroy ✅
Vickie Rahman City of Gilroy (Staff - Finance
Analyst) ✅
Neysa Fligor City of Los Altos ●
Rob Rennie Town of Los Gatos ✅ ✅
Evelyn Chua City of Milpitas
Javed Ellahie City of Monte Sereno ●
Bryan Mekechuk City of Monte Sereno
(Alternate Director) ✅ ✅
Yvonne Martinez Beltran City of Morgan Hill ● ✅
Margaret Abe-Koga City of Mountain View ✅ ✅ ✅
Tina Walia City of Saratoga
Larry Klein City of Sunnyvale ✅
Gustav Larsson
City of Sunnyvale
(Alternate Director) ✅
Otto Lee County of Santa Clara
● = Confirmed appointment for 2022
✅ = To be ratified at Feb. 9, 2022 Board of Directors Meeting Item 3
Attachment 2

Page 1 of 5 ends

Staff Report – Item 4
Item 4: Adopt Resolution to Implement SVCE Generation Rate Changes Effective March 2022 From: Girish Balachandran, CEO
Prepared by: Amrit Singh, CFO and Director of Administrative Services Don Bray, Director of Account Services and Community Relations Date: 2/9/2022

RECOMMENDATION
Staff recommends that the Board of Directors adopt Resolution 2022-06, authorizing the CEO to implement SVCE generation rate changes at a 1% discount to PG&E generation rates taking effect when PG&E implements its next generation rate change, which is expected to occur on March 1, 2022.

Staff also seeks the Board’s recommendation on any additional amount of funding to be transferred from the operating budget to the programs decarbonization fund. Depending on the Board’s recommendation, staff will accordingly update the budget and will present it at the next Board meeting as part of the mid-year budget update.

EXECUTIVE COMMITTEE AND FINANCE AND ADMINISTRATION COMMITTEE REVIEWS At the time the Executive Committee (November 17, 2021) and the Finance and Administration Committee (November 29, 2021) met to consider SVCE rate changes, we were expecting as in previous years that the CPUC in December would issue its decision on PG&E’s Energy Resource Recovery Account (ERRA) Forecast Application authorizing PCIA and PG&E generation rate changes taking effect January 1, 2022. However, late in November, the Administrative Law Judge (ALJ) issued a ruling requesting PG&E to provide additional data on ERRA and other balancing accounts, which delayed the implementation of the rate changes. Based on a revised schedule, the CPUC issued the Proposed Decision on January 24, 2022, and is expected to issue its final decision on February 10, 2022, authorizing new rates effective March 1, 2022.

Although the implementation of the rate change is delayed, the scope of discussion at both Committees is still relevant. The discussion at both Committees centered on improved SVCE budget projections resulting from expected higher margins because of lower PCIA rates and higher PG&E generation rates than assumed in the fiscal year 2021-2022 (FY 22) budget. Considering the improved margins, the Committees engaged in robust discussion on providing additional customer discount, increasing funding for the decarbonization programs, and building adequate reserves to withstand risks from extreme but plausible events that can create significant financial hardship for the organization.

At the time of the Committee meetings, we were expecting the current fiscal year budget projection of contribution to reserves to increase from $36.5 million to $109 million. As explained in the next section, we are now projecting an increase to about $61.9 million because of the delayed rate changes. 1 The loss of
additional revenues in January and February of 2022, because of delayed implementation of rate changes, is 1 This revised budget projection mainly accounts for updates to only revenues and power supply costs. Staff will revise the full budget projections as part of the mid-year budget update in March 2022.

Item 4

SILICON VALLEY

CLEAN ENERGY
Agenda Item: 4 Agenda Date: 2/09/2022

Page 2 of 5 ends

now shifted to the next calendar year because the CPUC is expected to amortize the rate changes over a 12- month period beginning March 1, 2022.

At the November 17, 2021 meeting, the Executive Committee (EC) reached consensus to spend an additional $20 million from the FY 22 budget because of the improved budget projections. On how to spend the money between decarbonization programs and additional customer discount, the EC decided to have that discussion with the full Board.

At the special session of the Finance and Administration Committee on November 29, 2021, the Committee voted unanimously to recommend that the Board maintain a 1% customer discount rate and to target a transfer of $20 million to the Programs Fund at the March 2022 mid-year budget update.

BACKGROUND
When the Board approved the FY 22 budget in September 2021, the Board authorized to maintain the 1% customer discount to PG&E generation rates despite significant anticipated reduction in PCIA and increase in PG&E Generation rate. The Board agreed to revisit the discount rate at the December 2021 meeting expecting more certainty on PCIA and PG&E generation rates.

On November 8, 2021, PG&E filed its updated 2022 Energy Resource Recovery Account (ERRA) Forecast Application that showed higher SVCE implied margins than assumed in the FY 22 budget. Relative to the FY 22 budget assumptions, PG&E’s generation rate was expected to increase by about 24% and PCIA was expected to decrease by about 54%, thereby improving SVCE’s margin by about 44% in the calendar year 2022. As discussed in the previous section, the CPUC delayed issuing its ruling on the ERRA Application decision and is now expected to issue its decision on February 10, 2022. Based on the proposed decision issued on January 24, 2022, staff estimates that relative to the FY 22 budget assumptions, PG&E’s generation rate will increase by about 21% and PCIA will decrease by about 20%, thereby improving SVCE’s margin by about 32% over the next 12 months starting March 1, 2022.
2 ANALYSIS & DISCUSSION
The table below shows the estimated budget projections3. These estimates are based on rates derived from the CPUC’s Proposed Decision issued on January 24th, and the final rates are expected to be available in late February.
2 Relative to the current rates, PG&E’s generation rate is expected to increase by about 33% and PCIA is expected to decrease by about 58%, thereby improving SVCE’s margin by about 100%. 3 The budget numbers in the table does not include the $600,000 of transfer to Programs Fund for savings from PG&E nuclear allocation approved by the Board at the November 2021 meeting.

FY 22 Budget ($ in thousands) Budget With Revised
Margins ** Variance
Revenues* 342,105 376,802 34,697
Power Supply Cost 273,561 282,835 9,274
Operating Margin 68,544 93,967 25,423
Other Costs 32,060 32,060 -
Net Contribution to Reserves 36,484 61,907 25,423
* Potential customer write-offs included in other costs. ** Assumes 1% customer discount.

Item 4
F
Agenda Item: 4 Agenda Date: 2/09/2022

Page 3 of 5 ends

The column titled “Budget” displays that at the time the FY 22 budget was adopted, the anticipated contribution to reserves was about $36.5 million. The revised margins column shows that if we were to maintain the customer discount to PG&E generation rates at the current level of 1%, then the contribution to margin would increase to about $61.9 million because of the significant increase in PG&E generation rates and drop in the PCIA.

Given the improved budget projections and in deciding how to increase any spending by providing additional customer discount and/or additional funding towards SVCE’s decarbonization programs fund, staff recommends the Board consider several risk factors. The higher margins result from extreme increases in power market prices, which in risk terminology can be referred to as a black-swan event. SVCE is fortunate that this black swan event occurred in its favor; however, future black-swan events can affect us adversely and draw substantial funds from the reserves and/or cause SVCE to increase customer rates to uncompetitive levels. As a result, it’s important to have sufficient reserves that can withstand an adverse black-swan event.

Also, PCIA and PG&E generation rates are based on estimates for 2022 cost of power. If the actual realized power cost is lower than the estimates, then the PCIA will be undercollected and PG&E’s ERRA balance will be overcollected4. This market outcome would result in a higher 2023 PCIA and lower PG&E generation rate thereby reducing SVCE margin.

Staff modeled an adverse black-swan event for calendar year 2023 where market price for power plunges to historical low levels, near the one percentile of the recent power forward market prices. The analysis was conducted in November 2021 and was shared with the Executive Committee and the Finance and Administration Committee. Given the delay in the CPUC schedule, staff did not have sufficient time to update the analyses. While the absolute value of the numbers in the table will be different when accounting for final PG&E generation rate and PCIA values, the relative values among the modeled scenarios should be similar and therefore, the overall message from the analyses remains pertinent.

The Cal 2023 Forecast column shows the current estimated contribution to reserves (for calendar year 2023) based on the November 2021 power market forward prices of about $109 million. If market prices drop to the current one percentile level (for 2022 and 2023), which is close to where the market was trading about a year ago for power to be delivered in 2022, and depending on the level of hedges in place, SVCE could draw about $157 million (70% hedged case) to $188 million (100% hedged case) from the reserves. SVCE’s reserves at the end of December 31, 2021 is at $154 million.
4 The ERRA account tracks PG&E’s cost to its generation customers (bundled customers) and the new generation rates will be based on the current forward prices or estimate for the future price of power. If the actual prices are lower than the forward prices used to set rates, then PG&E will overcollect because its actual cost of serving its customers will be lower than the estimate of power prices used to set rates. As a result, in 2023 PG&E will return the overcollection back to its customers, which will result in lower PG&E generation rates.

Item 4
Cal 2023
Forecast
Stress Test

1.* *
Stress Test
2 ***
($ in thousands)
Revenues*
Power Supply Cost
Operating Margin
Other Costs
Net Contribution to Reserves
394,111
251,249
96,629
219,867
96,629
251,249
(123,238)
33,663
(154,620)
33,663
142,862
33,663
109,199 (156,901) (188,283)
* Potential customer write-offs included in other costs. ** Hedges for Cal 2023 at current 70% level. Assumes1% customer discount. *** Assumes Cal 2023 is hedged 100% at today's prices. Assumes 1% customer discount.

Agenda Item: 4 Agenda Date: 2/09/2022

Page 4 of 5 ends

Staff recommends that SVCE build reserves such that it can withstand the above modeled stress tests with 120 days of cash remaining, the minimum reserve target per the Board-approved Reserves Policy. The $157 million and $188 million draw from reserves under the stress test scenario translates to about 189 and 227 days cash on hand (DCOH), respectively. On an expected basis, the forecast DCOH at the beginning of 2023 is 348 (based on November 2021 analysis). Therefore, if the modeled stress conditions were to occur in 2023, the DCOH would drop to either 121 (348 less 227) or 159 (348 less 189). To maintain 120 DCOH, under the fully hedged stress test scenario, leaves one DCOH for additional expenditure, which is equivalent to about $1 million and leaves 39 DCOH (159 less 120), under the 70% hedged stress test scenario, which is equivalent to about $32 million. The table below summarizes these results.

Based on the above stress test analyses, staff recommends that the Board consider keeping the maximum additional expenditure within the range of $1 to $32 million. From this range, staff recommends additional spending from the FY 22 budget of no more than $20 million.

The table below shows some options for the Board’s consideration in allocating the $20 million between additional funding for programs and additional customer discount.5 *Inclusive of equity program allocation to focus on low-income customers.

Timing and Uncertainty of CPUC’s Approval of PG&E’s ERRA Application Based on the current schedule, the CPUC is expected to issue its final decision on PG&E generation rates and PCIA changes at its February 10, 2022, meeting. If the CPUC is delayed in issuing the decision, staff will implement the rate changes as soon as possible once PG&E publishes the final rates. Staff is aiming to have the new rates effective on the same day as the changes to PG&E’s generation and PCIA rates go in effect. The current SVCE rates are very low, and a delay could cost SVCE as much as $580,000 a day in forgone revenues.

SVCE’s Data Services partner Calpine normally requires a minimum of two weeks to implement new rates into the billing system. Staff is working with Calpine to expediate the implementation of the rates. There’s a small chance that if final PG&E rates are received too late relative to when they go in effect, SVCE may delay the 5 The amount allocated to the programs fund will not reduce the net contribution to reserves until the expense is incurred.

Stress Tests
Beg. 2023 Forecast of
Reserves (DCOH)
Draw on
Reserves from
Stress Case
(DCOH)
Remaining
(DCOH)
Available for Use*
(Maintaining Min. Reserve
Threshold of 120 DCOH)
Available for Use
in $ Millions
Expected Ca
Forecast of R
(DCO
Price Drop to 1 percentile (100%
Hedged Case) 348 227 121 1 1 310
Price Drop to 1 percentile (70%
Hedged Case) 348 189 159 39 32 272
* Target to maintain 120 DCOH under the stress case scenario while ensuring that on an expected basis DCOH does not drop below the target threshold of 230 in FY22 .

Item 4
Customer Discount
% Relative to PG&E
Monthly Savings | Monthly Savings | Monthly Savings
to Medium
Commercial
Customer
Allocate to Programs
Double Down Strategy*
(Spend will occur over 3- Generation Rate
to-5-year period)
to Average
Residential
to Small
Commercial
Customer Customer
20 million 1% (existing discount) $0.75 $2.68 $31.00

16.5 million 2% (add’l 1%) $1.50 $5.36 $62.00
13 million 3% (add’l 2%) $2.25 $8.04 $93.00
Agenda Item: 4 Agenda Date: 2/09/2022

Page 5 of 5 ends

billing of generation charges for some customers to the following month. In other words, some customers may see two months of generation charges in the following month.

Rate Design and Update Methodology
SVCE will update all GreenStart generation rates to be exactly 1% below PG&E’s corresponding generation rate, including surcharges (PCIA and Franchise Fee). This rate design approach has been used since the launch of SVCE and has the advantages of comparability and ease of customer communications in that the generation cost savings will be set at 1% for all customer rate classes. 100% Renewable Energy Option
The GreenPrime rate for 2022, SVCE’s 100% renewable energy option, will remain unchanged from 2021. The charge is equivalent to the per unit cost difference between the default energy mix of 50% eligible renewable/carbon free energy and the 100% eligible renewable energy mix. This premium is calculated to be $0.008 per kWh, which is added to the otherwise applicable rate for the default GreenStart service offering.

STRATEGIC PLAN
The recommendations support SVCE Strategic Plan Goal 13 – “Commit to maintaining a strong financial position” and the accompanying measures, “Set balanced rates that maintain customer value and support SVCE’s financial stability” and “Balanced budget that achieves cash reserve targets and maintains customer value”.

FISCAL IMPACT
The estimated financial impact of this recommendation for the FY2021-22, is an increase in revenues for the current fiscal year from $342 million to $378 million. This would be reflected in more detail in the mid-year budget update in March 2022. Every 1% increase in customer discount will reduce contributions to reserves of about $3.5 million over the remaining months of the FY 22 (March 2022 to September 2022). Any additional spending on decarbonization programs will further reduce the contribution to reserves.

ATTACHMENT

1. Resolution 2022-06, Approving Customer Generation Rates Item 4
1 RESOLUTION 2022-06

SILICON VALLEY CLEAN ENERGY AUTHORITY
RESOLUTION NO. 2022-06

A RESOLUTION OF THE BOARD OF DIRECTORS OF THE SILICON

VALLEY CLEAN ENERGY AUTHORITY APPROVING CUSTOMER

GENERATION RATES
WHEREAS, the Silicon Valley Clean Energy Authority (“Authority”) was formed on March 31, 2016 pursuant to a Joint Powers Agreement to study, promote, develop, conduct, operate, and manage energy programs in Santa Clara County; and WHEREAS, at the June 8, 2016 Board of Directors Meeting, the Board adopted the policy that the Authority’s customer generation rates for the default service will be 1% lower than Pacific Gas & Electric’s generation rates in place as of January 2017; and the policy allows reexamination of the rates, provided significant deviations in market prices or other extraordinary circumstances mandate an adjustment to the rates; and
WHEREAS, SVCE has a need to adopt customer generation rates that are competitive and contribute to the Authority’s cash reserves to allow the Authority to respond to risk, and
WHEREAS, on February 10, 2021, the Board of Directors adopted Resolution No. 2021-04 which approved the methodology for the customer generation rates that currently are in effect; and
WHEREAS, due to the expected significant decrease in the Power Cost Indifference Charge (PCIA) and increase in PG&E generation rates and for the reasons described in more detail in the agenda report, staff is recommending maintaining SVCE’s generation rate discount at 1% effective when PG&E implements its next generation rate change, which is expected to occur on March 1, 2022; and WHEREAS, since PG&E is not expected to issue its final customer generation rates until later in February 2022, the Board of Directors desire to grant the Chief Executive Officer the authority to adjust the Authority’s current electric generation rates for its customers when PG&E finalizes its 2022 rates.

NOW THEREFORE, the Board of Directors of the Silicon Valley Clean Energy Authority does hereby resolve, determine, and order as follows:

Section 1. Upon the release of PG&E’s final customer generation rates, the Chief Executive Officer is hereby authorized to amend the Authority’s 2022 Electric Generation Rates Schedule adopted by Resolution No. 2021-04 to provide for a 1% discount from PG&E’s generation rates.

Item 4
Attachment 1
2 RESOLUTION 2022-06
Section 2. The Authority’s electric generation rates, as adjusted by the Chief Executive Officer pursuant to Section 1 above, shall become effective within 15 days after PG&E releases its 2022 customer generation rates.

The Authority’s adjusted electric generation rates shall be set forth in a 2022 Electric Generation Rates Schedule. The Chief Executive Officer shall provide a copy of the 2022 Electric Generation Rates Schedule to the Board of Directors at its first meeting after the 2022 electric generation rates are adjusted.

Section 3. Resolution No. 2021-04 is hereby rescinded upon the effective date of the 2022 Electric Generation Rates Schedule.

ADOPTED AND APPROVED this 9th day of February 2022, by the following vote:

Chair
ATTEST:

Andrea Pizano, Board Secretary
Item 4
Attachment 1

Page 1 of 4 ends

Staff Report – Item 5
Item 5: Authorize the Chief Executive Officer to Execute Necessary Agreements for Tumbleweed Long Duration Energy Storage with California Community Power, Participating Community Choice Aggregators and LS Power’s Tumbleweed LLC From: Girish Balachandran, CEO
Prepared by: Monica Padilla, Director of Power Resources Date: 2/9/2022

RECOMMENDATION
Staff recommends that the Board delegate authority to the Chief Executive Officer (CEO) to execute on behalf of Silicon Valley Clean Energy Authority (SVCE) as a member of California Community Power (“CC Power”) the following agreements and any necessary ancillary documents for the Tumbleweed Energy Storage for Long Duration Storage (LDS) with a delivery term of 15 years starting at the Commercial Operation Date on or about June 1, 2026, for a quantity not to exceed 22.41 MW and amount not to exceed $100 million:

1. Project Participation Share Agreement (PPSA) between Silicon Valley Clean Energy Authority, California Community Power and participating community choice aggregators (CCAs) – Attachment 1

2. Energy Storage Service Agreement (ESSA) - Buyer Liability Pass Through Agreement (BLPTA) between Silicon Valley Clean Energy Authority, California Community Power and Tumbleweed Energy Storage, LLC – Attachment 2

3. Operations Agreement (COA) between Silicon Valley Clean Energy Authority, California Community Power and participating CCAs for Tumbleweed – To be developed, not attached.

BACKGROUND
Through the 2020 Integrated Resource Planning (IRP) proceeding, the California Public Utilities Commission (CPUC) had identified the need for additional storage including longer-duration storage to enable grid integration of a large fleet of intermittent resources to meet California’s greenhouse gas emission reduction goals and to replace several natural gas once-through-cooling (OTC) resources and the Diablo Canyon Nuclear Power Plant (DCNPP) slated to retire between 2023 and 2025.

In October 2020, SVCE along with nine other CCAs issued a request for offers (“Joint LDS RFO”) with the intent to procure cost effective LDS resource(s) to meet each CCA’s respective portfolio needs and in anticipation of potential procurement mandates by the CPUC. Subsequently, in June 2021, as part of the 2020 IRP the CPUC issued through a decision order (D.21-06-035) the Mid-term Reliability Procurement Order (“MTR Order”) requiring jurisdictional load serving entities (LSEs), such as SVCE, to procure and/or develop a collective 11,500 MW of new capacity by 2026. Included within the MTR Order is an identified need of 1,000 MW of LDS. SVCE’s obligation is approximately 22 to 26 MW depending on the CPUC’s final determination of effective load carrying capacity (ELCC) factors for LDS resources.

In February 2021, CC Power was formed by ten CCAs, including SVCE, to share resources and risk related to the procurement of difficult to acquire resources. Once formed, CC Power took over the Joint LDS RFO including shortlisting of projects and coordination of negotiations and development of necessary agreements.

Item 5

SILICON VALLEY

CLEAN ENERGY
Agenda Item: 5 Agenda Date: 2/9/2022

Page 2 of 4 ends

Through the Joint LDS RFO, projects were evaluated, ranked and selected for shortlisting with the objective of meeting the RFO’s cost effectiveness goals, criteria and requirements under the MTR Order and CC Power’s enhanced contract conditions for labor, environment and environmental justice. Three projects were identified for consideration including LS Power’s Tumbleweed. Of the original nine CCAs participating in the Joint LDS RFO in addition to SVCE, six CCAs have agreed to participate in the Tumbleweed LDS Project including:

1. Clean Power San Francisco (CPSF)

2. Peninsula Clean Energy (PCE)

3. Redwood Coast Energy Authority (RCEA)

4. San Jose Clean Energy (SJCE)

5. Sonoma Clean Power Authority (SCPA)

6. Valley Clean Energy (VCE)
In the aggregate the long duration storage mandate for the participating members, measured in Net Qualifying Capacity (NQC), is 96.5 MW. Table 1 is a summary of the MTR Order and PPSA entitlement share for each of the participating CCAs.

Table 1: MTR Order Net Qualifying Capacity (NQC) and Tumbleweed Entitlement Share CCA
CPUC Capacity
Obligation MW
NQC
PPSA
Entitlement
Share
Tumbleweed
Allocation
(MW)
Tumbleweed
Allocation
NQC
Credit Rating
CPSF 15.5 16.06% 11.08 8.67 Moody’s A2
PCE 19 19.69% 13.59 10.62 Moody’s Baa2
Fitch BBB+
RCEA 3.5 3.62% 2.50 1.95 -
SJCE 21.5 22.28% 15.37 12.02 -
SVCE 20.5 21.25% 14.66 11.47 Moody’s Baa2
S&P A
SCPA 12.5 12.95% 8.94 6.99 S&P A
VCE 4 4.15% 2.86 2.24 -
Total 96.5 100.00% 69.00 53.96
Tumbleweed meets the conditions established in the MTR Order for LDS resources including the minimum eight-hour discharge duration, ten year contract term, start date and ability to meet resource adequacy requirements. If each participating CCA approves its PPSA entitlement share, SVCE will meet approximately 55% of its MTR Order requirements.

The Executive Committee at its November 17, 2021 meeting reviewed the Tumbleweed agreements and directed the CEO to vote on behalf of SVCE support of the Tumbleweed project at the CC Power Board meeting. The CC Power Board unanimously approved Resolution No. R22-01-02 - Approval of Tumbleweed LDS Project and Authorization to Execute Associated Agreements (Attachment 3) at its January 19, 2022 meeting. On January 24, 2022 CC Power and LS Power executed the Tumbleweed ESSA. The CCAs have 90 days from the ESSA effective date to get approval of the necessary agreements. Failure to gain approval will result in a termination of the Tumbleweed ESSA.

ANALYSIS & DISCUSSION
The Tumbleweed project is a 69 MW/552 MWh lithium-ion battery storage facility located in Kern County, CA.

The anticipated commercial operations date of the project is June 2026. SVCE’s expected share of the agreement is 21.25% or 14.66 MW/117 MWh.

Item 5
Agenda Item: 5 Agenda Date: 2/9/2022

Page 3 of 4 ends

Overview of Project
Project Name Tumbleweed Energy Storage, LLC
Technology Li-Ion Storage – 8 hour discharge duration
Storage Capacity 69 MW / 552 MWh
Commercial Operation Date & Term 6/1/2026, 15 years
Developer REV Renewables, a subsidiary of LS Power
Location Kern County, CA
The project has an executed interconnection agreement with the California Independent System Operator (CAISO) for Full Capacity Deliverability Status (FCDS) for the energy storage component, meaning it will provide resource adequacy attributes in addition to energy benefits. The project will interconnect to Southern California Edison’s Whirlwind substation.

Under the contract, CC Power will pay for the use of the storage project at a fixed-price rate per kW-month, with no escalation, for the full term of the contract (15 years). CC Power is entitled to all product attributes from the facility, including energy arbitrage, ancillary services, and resource adequacy. Through the PPSA, SVCE will pay for its entitlement share of the project and also receive its share of the attributes and benefits of the LDS project.

Developer
The project is being developed by REV Renewables, which is a subsidiary of LS Power. LS Power was founded in 1990 and is a development, investment and operating company focused on the power and energy infrastructure sector. LS Power has developed more than 660 miles of high voltage transmission, and developed, constructed, managed, or acquired more than 45,000 MW of power generation, including utility-scale solar, wind, hydro, natural gas-fired and battery energy storage projects.

LS Power formed REV Renewables to accelerate investment in renewable energy and storage technologies.

REV owns 1.9 GW of operating energy storage across the U.S. including 600MW of operating battery energy storage. REV has an additional 1.3 GW of battery energy storage in development.

Contract Structure
This project consists of three basic agreements to which CC Power is a party and a guarantee agreement to which the participating member and the developer are parties. The LDS contract structure allocates rights and obligations, project benefits, and cost and allocation of risks and liabilities as described below:

Energy Storage Service Agreement - The ESSA is between CC Power and an LDS developer and addresses issues such as (1) project requirements and milestones, (2) price, (3) quantity, (4) term, (5) payment obligations, and other key terms.

Buyer Liability Pass Through Agreements – The Intent of the BLPTA is to mirror the liability a participating CCA would have if executing the ESSA directly with an LDS developer. Through the BLPTAs, each CCA guarantees CC Power’s payment obligations in proportion to each participating CCAs’ share of the project.

In exchange, the LDS developer agrees to release CC Power from liability and to limit recovery from each CCA to an amount proportionate to each CCA’s share of the project.

Project Participation Share Agreement – Under the PPSA, participating CCAs agree to fund CC Power’s payment obligations so that CC Power can make timely payments under the ESSA. The PPSA also addresses how participating CCAs will (1) share revenue from CC Power’s sales of energy and ancillary services from the LDS facility into the CAISO market, (2) direct CC Power’s actions under the ESSA, and (3) step in, with a cap, to cover any member default in order to avoid a CC Power default under the ESSA.

Operations Agreement - The contracting structure for this agreement also contemplates an Operating Agreement between CC Power and the participating CCAs. This agreement will authorize retention of a Item 5
Agenda Item: 5 Agenda Date: 2/9/2022

Page 4 of 4 ends

scheduling coordinator and establish a decision-making structure to direct the scheduling coordinator to dispatch the LDS facility. The Operations Agreement is currently in the process of being developed by the participating CCAs and will be operational in nature. No dollar expenditures are contemplated under the Operations Agreement.

Consistent with the CC Power Board direction for enhanced contracting conditions, the project will be constructed under a project labor agreement, thus assuring payment of prevailing wages and use of apprenticeship programs. The project will also adhere to CC Power environmental and environmental justice conditions.

PPSA Allocation
Each participating CCA is seeking a minimum approval authority to cover their entitlement share plus two contingencies. The first contingency is to cover the unlikely event that one large CCA does not gain the necessary approvals to move forward. In such case, rather than allowing the ESSA to terminate, the remaining CCAs will increase their entitlement share. The second contingency is intended to cover a step-up provision included in the PPSA, where if a CCA defaults after the PPSA is executed, the remaining CCAs will need to step up to take additional allocation. The step-up provision is capped at 125% of the PPSA entitlement share.

SVCE’s expected entitlement share is 21.25% or 14.66 MW, however is seeking authority to receive an allocation of up to 22.41 MW to cover the two contingencies.

STRATEGIC PLAN
Execution of the Tumbleweed project agreements supports the goals of the Board adopted Strategic Plan including:
• Goal 5 - Acquire clean and reliable electricity in a cost effective, equitable and sustainable manner • Goal 6 - Manage and optimize power supply resources to meet affordability, GHG reduction and reliability objectives

ALTERNATIVE
SVCE can decide to procure LDS resources on its own and not through CC Power. This alternative is not recommended as LDS resources are not considered cost-effective at this time and it is difficult to procure the exact amount required of SVCE via the MTR Order. Procuring on its own, may require SVCE to over-procure while participating through the LDS Project will allow SVCE to minimize the amount of capacity procured.

SVCE can choose not to abide by the MTR Order. Doing so would expose SVCE’s ratepayers to significant cost in the form of “back-stop” procurement undertaken by Pacific Gas & Electric and imposed on SVCE’s customers in addition to CPUC penalties imposed on SVCE.

FISCAL IMPACT
Ultimate execution of the agreements needed to effect the LDS Project will result in cost to SVCE starting in Fiscal Year 2025-26, which will be included in the budget at that time. Additional costs to administer the monitoring and implementation of the LDS Project agreements through CC Power are expected for FY 2021-22 and have been included in Operating Budget.

ATTACHMENTS

1. Project Participation Share Agreement

2. Redacted Energy Storage Service Agreement with Buyer Liability Pass Through Agreement

3. California Community Power Resolution No. R22-01-01
Item 5

TUMBLEWEED ENERGY STORAGE

PROJECT PARTICIPATION SHARE AGREEMENT
among

CITY AND COUNTY OF SAN FRANCISCO, ACTING BY AND THROUGH ITS

PUBLIC UTILITIES COMMISSION CLEANPOWERSF
and

PENINSULA CLEAN ENERGY
and

REDWOOD COAST ENERGY AUTHORITY
and
CITY OF SAN JOSÉ, ADMINISTRATOR OF SAN JOSÉ CLEAN ENERGY and

SILICON VALLEY CLEAN ENERGY
and

SONOMA CLEAN POWER
and

VALLEY CLEAN ENERGY
and

CALIFORNIA COMMUNITY POWER
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1 Draft Project Participation Share Agreement
ARTICLE 1 DEFINITIONS....................................................................................................... 1

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

1.2. Rules of Interpretation ......................................................................................... 15 ARTICLE 2 EFFECTIVE DATE AND TERM ...................................................................... 16

2.1. Term. .................................................................................................................... 16 ARTICLE 3 AGREEMENT ..................................................................................................... 16

3.1. Transaction ........................................................................................................... 16 ARTICLE 4 ENTITLEMENT SHARE ................................................................................... 17

4.1. Initial Entitlement Share ...................................................................................... 17

4.2. Change of Entitlement Share. .............................................................................. 17

4.3. Reduction of Entitlement Share to Zero .............................................................. 17 ARTICLE 5 OBLIGATIONS OF CCP; ROLE OF CCP BOARD AND CCP MANAGER .................................................................................................. 17

5.1. Obligations of CCP .............................................................................................. 17

5.2. Role of CCP Board. ............................................................................................. 21

5.3. Role of CCP Manager. ......................................................................................... 23 ARTICLE 6 PROJECT COMMITTEE .................................................................................. 23

6.1. Establishment and Authorization of the Project Committee ................................ 23

6.2. Project Committee Membership .......................................................................... 23

6.3. Project Committee Operations, Meetings, and Voting. ....................................... 24

6.4. Project Committee Responsibilities. .................................................................... 24

6.5. Subcommittees ..................................................................................................... 27

6.6. Representative’s Expenses ................................................................................... 27

6.7. Inaction by Committee ......................................................................................... 27

6.8. Delegation ............................................................................................................ 27 ARTICLE 7 OPERATING COMMITTEE ............................................................................ 27

7.1. Operating Committee ........................................................................................... 27 ARTICLE 8 OPERATING ACCOUNT .................................................................................. 28

8.1. Calculation of Estimated Monthly Project Cost. ................................................. 28

8.2. Operating Account ............................................................................................... 28 ARTICLE 9 BILLING .............................................................................................................. 29

9.1. Monthly Costs ...................................................................................................... 29

9.2. Billing Statements ................................................................................................ 29

9.3. Disputed Monthly Billing Statement ................................................................... 29

9.4. Payment Adjustments; Billing Errors .................................................................. 29 Item 5
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9.5. Payment of Invoice Amount ................................................................................ 29

9.6. Withdrawal of Invoice Amount from Operating Account.. ................................. 30

9.7. Late Payments. ..................................................................................................... 30 ARTICLE 10 UNCONDITIONAL PAYMENT OBLIGATIONS;
AUTHORIZATIONS; CONFLICTS; LITIGATION. ............................. 30

10.1. Unconditional Payment Obligation ...................................................................... 30

10.2. Authorizations ...................................................................................................... 31

10.3. Conflicts ............................................................................................................... 31

10.4. Litigation .............................................................................................................. 31

10.5. San José Clean Energy. ........................................................................................ 31

10.6. Clean Power San Francisco.. ............................................................................... 31 ARTICLE 11 PROJECT SPECIFIC MATTERS AND PROJECT
PARTICIPANTS’ RIGHTS AND OBLIGATIONS UNDER THE
ESSA.............................................................................................................. 32

11.1. CCP Rights and Obligations under the ESSA ..................................................... 32 ARTICLE 12 NONPERFORMANCE AND PAYMENT DEFAULT. ................................. 32

12.1. Nonperformance by Project Participants ............................................................. 32

12.2. Payment Default ................................................................................................... 33

12.3. Payment Default Notice ....................................................................................... 33

12.4. Cured Payment Default ........................................................................................ 33

12.5. Suspension of Project Participant’s Project Revenue Rights ............................... 33

12.6. Termination and Disposal of Project Participant’s Project Rights ...................... 34

12.7. Step-Up Invoices. ................................................................................................. 34

12.8. Step-Up Allocation of Project Participant’s Project Rights ................................. 35

12.9. Elimination or Reduction of Payment Obligations .............................................. 37 ARTICLE 13 LIABILITY ........................................................................................................ 37

13.1. Project Participants’ Obligations Several ............................................................ 37

13.3. Extent of Exculpation; Enforcement of Rights .................................................... 38

13.4. No General Liability of CCP ............................................................................... 38

13.5. Indemnification .................................................................................................... 38 ARTICLE 14 NOTICES ........................................................................................................... 39

14.1. Addresses for the Delivery of Notices ................................................................. 39

14.2. Acceptable Means of Delivering Notice .............................................................. 39 ARTICLE 15 ASSIGNMENT .................................................................................................. 39

15.1. General Prohibition on Assignments ................................................................... 39 ARTICLE 16 GOVERNING LAW AND DISPUTE RESOLUTION .................................. 39

16.1. Governing Law .................................................................................................... 39 Item 5
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16.2. Dispute Resolution ............................................................................................... 40 ARTICLE 17 MISCELLANEOUS .......................................................................................... 40

17.1. Entire Agreement; Integration; Exhibits .............................................................. 40

17.2. Amendments ........................................................................................................ 40

17.3. No Waiver ............................................................................................................ 40

17.4. Severability .......................................................................................................... 40

17.5. Counterparts ......................................................................................................... 40

17.6. Electronic Delivery .............................................................................................. 40

17.7. Binding Effect ...................................................................................................... 41

17.8. Forward Contract ................................................................................................. 41

17.9. City of San Francisco Standard Provisions. ......................................................... 41

17.10. City of San José Standard Provisions. ................................................................. 42

17.11. Further Assurances............................................................................................... 43 EXHIBIT A NOTICES ............................................................................................................. A-1

EXHIBIT B SCHEDULE OF PROJECT PARTICIPANT ENTITLEMENT SHARES AND STEP-UP ALLOCATION CAPS ...................................................... B-1

EXHIBIT C PROCEDURE FOR VOLUNTARY REDUCTION OF PROJECT
PARTICIPANT’S ENTITLEMENT SHARE .......... C-Error! Bookmark not defined.

EXHIBIT D PROJECT COMMITTEE OPERATIONS, MEETINGS, AND VOTING D-Error! Bookmark not defined.

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TUMBLEWEED ENERGY STORAGE

PROJECT PARTICIPATION SHARE AGREEMENT

PREAMBLE
This Project Participation Share Agreement (“Agreement”) is entered into as of _________ (the “Effective Date”), by and among the City and County of San Francisco acting by and through its Public Utilities Commission, CleanPowerSF, Peninsula Clean Energy, a California joint powers authority, Redwood Coast Energy Authority, a California joint powers authority, City of San José, a California municipality, Silicon Valley Clean Energy, a California joint powers authority, Sonoma Clean Power, a California joint powers authority, and Valley Clean Energy, a California joint powers authority (each individually a “Project Participant” and collectively referred to as the “Project Participants”) and California Community Power (“CCP”), a California joint powers authority. CCP and the Project Participants are sometimes referred to herein individually as a “Party” and jointly as the “Parties.” All capitalized terms used in this Agreement are used with the meanings ascribed to them in Article 1 to this Agreement.

RECITALS
WHEREAS CCP is a Joint Powers Authority, was formed for the purpose of developing, acquiring, constructing, owning, managing, contracting for, engaging in, or financing electric energy generation and storage projects, and for other purposes; and WHEREAS, the Project Participants have participated with CCP in the negotiation of an agreement for purchase of the certain energy storage products of Tumbleweed Energy Storage (the “Project” as defined in Exhibit A of the ESSA), and CCP is to enter into an Energy Storage Service Agreement (“ESSA”), which is incorporated herein by this reference, with Tumbleweed Energy Storage, LLC, a Delaware limited liability company (“Project Developer”), providing for purchase of the energy storage products, and associated rights, benefits, and credits from the Project on behalf of the Project Participants.

WHEREAS, pursuant to this Agreement, CCP shall cause to deliver to each Project Participant the Project Participant’s associated share of the energy storage products and associated rights, benefits, and credits of the Project.

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. Definitions. The following terms, when used herein with initial capitalization, shall have the meanings set forth below:

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“AC” means alternating current.
“Affiliate” means, with respect to any Person, each Person that directly or indirectly controls, is controlled by, or is under common control with such designated Person. For purposes of this definition and the definition of “Permitted Transferee”, “control” (including, with correlative meanings, the terms “controlled by” and “under common control with”), as used with respect to any Person, shall mean (a) the direct or indirect right to cast at least fifty percent (50%) of the votes exercisable at an annual general meeting (or its equivalent) of such Person or, if there are no such rights, ownership of at least fifty percent (50%) of the equity or other ownership interest in such Person, or (b) the right to direct the policies or operations of such Person. “Agreement” has the meaning set forth in the Preamble and any Exhibits, schedules, and any written supplements hereto.
“Amended Annual Budget” means the budget approved by the Project Committee and adopted by the CCP Board pursuant to Section 5.1(c) of this Agreement. “Ancillary Services” means frequency regulation, spinning reserve, non-spinning reserve, regulation up, regulation down, black start, voltage support, and any other ancillary services that the Facility is capable of providing consistent with the Operating Restrictions set forth in Exhibit Q of the ESSA, as each is defined in the CAISO Tariff.
“Annual Budget” means the budget approved by the Project Committee and adopted by the CCP Board pursuant to Section 5.1(c) of this Agreement. “Bankrupt” or “Bankruptcy” means, with respect to any entity, such entity that (a) files a petition or otherwise commences, authorizes or acquiesces in the commencement of a proceeding or cause of action under any bankruptcy, insolvency, reorganization or similar Law, (b) has any such petition filed or commenced against it which remains unstayed or undismissed for a period of ninety (90) days, (c) makes an assignment or any general arrangement for the benefit of creditors, (d) otherwise becomes bankrupt or insolvent (however evidenced), (e) has a liquidator, administrator, receiver, trustee, conservator or similar official appointed with respect to it or any substantial portion of its property or assets, or (f) is generally unable to pay its debts as they fall due.
“Billing Statement” has the meaning set forth in Section 9.2 of this Agreement. “Buyer Liability Pass Through Agreement” or “BLPTA” means, for each Project Participant, the form set forth in Exhibit L of the ESSA, as executed by such Project Participant, countersigned by CCP, and delivered to the Project Developer. “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. “CAISO” means the California Independent System Operator Corporation or any successor entity performing similar functions.

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“CAISO Balancing Authority Area” has the meaning set forth in the CAISO Tariff. “CAISO Certification” means the certification and testing requirements for a storage unit 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 units, that are applicable to the Facility.
“CAISO Grid” has the same meaning as “CAISO Controlled Grid” as defined in the CAISO Tariff.
“CAISO Tariff” means the California Independent System Operator Corporation Agreement and Tariff, Business Practice Manuals (BPMs), and Operating Procedures, including the rules, protocols, procedures, and standards attached thereto, as the same may be amended or modified from time-to-time and approved by FERC.
“California Renewables Portfolio Standard” or “RPS” means the renewable energy program and policies established by California State Senate Bills 1038 (2002), 1078 (2002), 107 (2008), X-1 2 (2011), 350 (2015), and 100 (2018) as codified in, inter alia, California Public Utilities Code Sections 399.11 through 399.31 and California Public Resources Code Sections 25740 through 25751, as such provisions are amended or supplemented from time to time. “Capital Improvements” means any unit of property, property right, land or land right which is a replacement, repair, addition, improvement or betterment to the Project or any transmission facilities relating to, or for the benefit of, the Project, the betterment of land or land rights or the enlargement or betterment of any such unit of property constituting a part of the Project or related transmission facilities which is (i) consistent with Prudent Utility Practices and determined necessary and/or desirable by the CCP Board or (ii) required by any governmental agency having jurisdiction over the Project.
“CCP Board” means the Board of Directors of California Community Power. “CCP Manager” means the General Manager of California Community Power. “CEC” means the California Energy Commission, or any successor agency performing similar statutory functions.
“Capacity Attribute” means any current or future defined characteristic, certificate, tag, credit, or accounting construct associated with the amount of power that the Facility can charge, discharge, and deliver to the Delivery Point at a particular moment and that can be purchased, sold, or conveyed under CAISO or CPUC market rules, including Resource Adequacy Benefits. “CEQA” means the California Environmental Quality Act, as amended or supplemented from time to time.
“Chairperson” has the meaning set forth in Exhibit D.
“Change of Control” has the meaning set forth in Section 1.1 of the ESSA.

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“Charging Energy” means the Energy delivered to the Facility pursuant to a Charging Notice as measured at the Facility Metering Point by the Facility Meter, as such meter readings are adjusted by the CAISO for any applicable Electrical Losses. “Charging Notice” means the operating instruction, and any subsequent updates, given by CCP’s SC or the CAISO to Project Developer, directing the Facility to charge at a specific MW rate for a specified period of time or amount of MWh; provided, any such operating instruction shall be in accordance with the Operating Restrictions. “Commercial Operation” has the meaning set forth in Section 1.1 of the ESSA. “Commercial Operation Date” or “COD” has the meaning set forth in Section 1.1 of the ESSA.
“Commercial Operation Delay Damages” has the meaning set forth in Section 1.1 of the ESSA.
“Communications Protocols” has the meaning set forth in Section 1.1 of the ESSA. “Community Choice Aggregator” has the meaning set forth in California Public Utilities Code § 331.1.
“Confidential Information” has the meaning set forth in Section 18.1 of the ESSA. “Construction Start” has the meaning set forth in Exhibit B of the ESSA. “Construction Start Date” has the meaning set forth in Exhibit B of the ESSA. “Contract Price” has the meaning set forth on the Cover Sheet of the ESSA. “Contract Term” has the meaning set forth in Section 2.1 of the ESSA. “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. “Coordinated Operations Agreement” means the agreement by and among CCP and all Project Participants for purposes of operating the Project. “Costs” means, with respect to a Project Participant assuming all or a portion of a Defaulting Project Participant’s Entitlement Share pursuant to the process set forth in Section

12.8(b) or 12.8(c), brokerage fees, commissions and other similar third-party transaction costs and expenses reasonably incurred by such Project Participant in terminating any arrangement pursuant to which it has hedged its obligations; and all reasonable attorneys’ fees and expenses incurred by the Project Participant in connection with the Step-Up Allocation. “CPUC” means the California Public Utilities Commission, or successor entity.

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“Cured Payment Default” means a Payment Default that has been cured in accordance with Section 12.4 of this Agreement.
“Daily Delay Damages” has the meaning set forth in Section 1.1 of the ESSA. “Damage Payment” means the amount to be paid by the ESSA Defaulting Party to the ESSA 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) of the ESSA. “Day-Ahead Market” has the meaning set forth in the CAISO Tariff. “Day-Ahead Schedule” has the meaning set forth in the CAISO Tariff. “Defaulting Project Participant” has the meaning set forth in Section 12.1. “Delivery Point” means the Facility Pnode on the CAISO grid. “Delivery Term” means the period of Contract Years set forth on the Cover Sheet of the ESSA beginning on the Commercial Operation Date, unless terminated earlier in accordance with the terms and conditions of the ESSA.
“Designated Fund” has the meaning set forth in Section 10.5. “Development Security” means (a) cash or (b) a Letter of Credit in the amount set forth on the Cover Sheet of the ESSA.
“Discharging Energy” means the Energy delivered from the Facility to the Delivery Point pursuant to a Discharging Notice during any Settlement Interval or Settlement Period, as measured at the Facility Metering Point by the Facility Meter, as such meter readings are adjusted by the CAISO for any applicable Electrical Losses.
“Discharging Notice” means the operating instruction, and any subsequent updates, given by CCP’s SC or the CAISO to the Facility, directing the Facility to discharge Facility Energy at a specific MW rate for a specified period of time or to an amount of MWh. “Effective Date” has the meaning set forth in the Preamble. “Electrical Losses” means all transmission or transformation losses (a) between the Delivery Point and the Facility Metering Point associated with delivery of Charging Energy, and (b) between the Facility Metering Point and the Delivery Point associated with delivery of Facility Energy.
“Emission Reduction Credits” or “ERCs” means emission reductions that have been authorized by a local air pollution control district pursuant to California Division 26 Air Resources; Health and Safety Code Sections 40709 and 40709.5, whereby a district has established a system by which all reductions in the emission of air contaminants that are to be used to offset certain future increases in the emission of air contaminants shall be banked prior to use to offset future increases in emissions.

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“Energy” means electrical energy, measured in kilowatt-hours or Megawatt-hours or multiple units thereof.
“Energy Management System” or “EMS” means the Facility’s energy management system.
“Energy Storage Service Agreement” or “ESSA” means the agreement between CCP and Project Developer for the purchase of energy storage products of Tumbleweed Energy Storage, executed on _________________.
“ESSA Defaulting Party” has the meaning set forth in Section 11.1(a) of the ESSA. “ESSA Non-Defaulting Party” has the meaning set forth in Section 11.2 of the ESSA. “Entitlement Share” means the percentage entitlement of each Project Participant as set forth in Exhibit B of this Agreement (entitled “Schedule of Project Participant Entitlement Shares and Step-Up Allocation Caps”) attributable to each such Project Participant, as may be amended pursuant to Section 4.2 or 12.8.
“Entitlement Share Reduction Amount” has the meaning set forth in Exhibit C. “Entitlement Share Reduction Compensation Amount” has the meaning set forth in Exhibit C.
“Entitlement Share Reduction Notice” has the meaning set forth in Exhibit C. “Environmental Attributes” shall mean any and all attributes under the RPS regulations or under any and all other international, federal, regional, state or other law, rule, regulation, bylaw, treaty or other intergovernmental compact, decision, administrative decision, program (including any voluntary compliance or membership program), competitive market or business method (including all credits, certificates, benefits, and emission measurements, reductions, offsets and allowances related thereto) that are attributable now, or in the future to the Facility and its displacement of conventional energy generation.
“Estimated Monthly Project Cost” has the meaning set forth in Section 8.1. “Event of Default” has the meaning set forth in Section 11.1 of the ESSA. “Expected Commercial Operation Date” means the date set forth on the Cover Sheet of the ESSA.
“Facility” means the energy storage facility described on the Cover Sheet of the ESSA and in Exhibit A of the ESSA, located at the Site and including mechanical equipment and associated facilities and equipment required to deliver Product (but excluding any Shared Facilities), as such storage facility may be expanded or otherwise modified from time to time in accordance with the terms of the ESSA.

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“Facility Energy” means the Energy delivered from the Facility to the Delivery Point during any Settlement Interval or Settlement Period, as measured at the Facility Metering Point by the Facility Meter, as such meter readings are adjusted by the CAISO for any applicable Electrical Losses or Station Use.
“Facility Meter” has the meaning set forth in Section 1.1 of the ESSA. “Facility Metering Point” means the location(s) of the Facility Meter shown in Exhibit R of the ESSA.
“FERC” means the Federal Energy Regulatory Commission or any successor government agency.
“Flexible Capacity” means, with respect to any particular Showing Month, the number of MWs of Product which are eligible to satisfy Flexible RAR. “Flexible RAR” means the flexible capacity requirements established for load-serving entities by the CAISO pursuant to the CAISO Tariff, the CPUC pursuant to the Resource Adequacy Rulings, or by any other Governmental Authority.
“Force Majeure Event” has the meaning set forth in Section 10.1 of the ESSA. “Full Capacity Deliverability Status” or “FCDS” has the meaning set forth in the CAISO Tariff.
“Full Capacity Deliverability Status Finding” means a written confirmation from the CAISO that the Facility is eligible for Full Capacity Deliverability Status. “Gains” means, with respect to a Project Participant assuming all or a portion of a Defaulting Project Participant’s Entitlement Share pursuant to the process set forth in Section

12.8(b) or 12.8(c), an amount equal to the present value of the economic benefit to it, if any (exclusive of Costs), resulting from such Step-Up Allocation for the remaining Contract Term of the ESSA, determined in a commercially reasonable manner. Factors used in determining the economic benefit to such Project Participant may include, without limitation, reference to information supplied by one or more third parties, which shall exclude Affiliates of such Project Participant, 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., NP-15), all of which should be calculated for the remaining Contract Term, and include the value of Environmental Attributes and Capacity Attributes.
“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 Item 5
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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, except to the extent that the Party is acting solely in its governmental capacity.
“Greenhouse Gas” or “GHG” has the meaning set forth in the GHG Regulations or in any other applicable Laws.
“Guaranteed Commercial Operation Date” means the date set forth on the Cover Sheet of the ESSA, as such date may be extended pursuant to Exhibit B of the ESSA. “Guaranteed Construction Start Date” means the date set forth on the Cover Sheet of the ESSA, as such date may be extended pursuant to Exhibit B of the ESSA. “Installed Capacity” means the lesser of (a) PMAX, and (b) maximum dependable operating capacity of the Facility to discharge Energy for eight (8) hours of continuous discharge, as measured in MW AC at the Facility Meter Point by the Facility Meter and adjusted for Electrical Losses to the Delivery Point, that achieves Commercial Operation, as evidenced by a certificate substantially in the form attached as Exhibit I of the ESSA, as such capacity may be adjusted pursuant to Section 5 of Exhibit B of the ESSA.
“Interconnection Agreement” means the interconnection agreement entered into by Project Developer pursuant to which the Facility will be interconnected with the Transmission System, and pursuant to which Project Developer’s Interconnection Facilities and any other Interconnection Facilities will be constructed, operated, and maintained during the ESSA Contract Term.
“Interconnection Facilities” means the interconnection facilities, control and protective devices, and metering facilities required to connect the Facility with the Transmission System in accordance with the Interconnection Agreement.
“Interest Rate” has the meaning set forth in Section 8.2 of the ESSA. “Invoice Amount” has the meaning set forth in Section 9.2. “ITC” means the investment tax credit established pursuant to Section 48 of the United States Internal Revenue Code of 1986.
“Joint Powers Act” means the Joint Exercise of Powers Act of the State of California (Government Code Section 6500 et seq.).
“Joint Powers Agreement” means that certain Joint Powers Agreement dated January 29, 2021, as amended from time to time, under which CCP is organized as a Joint Powers Authority in accordance with the Joint Powers Act.
“kWh” means a kilowatt-hour measured in alternating current, unless expressly stated in terms of direct current.

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“Late Payment Notice” means a notice issued by CCP to a Project Participant pursuant to Section 9.7.
“Late Payment Charge” has the meaning set forth in Section 9.7. “Law” means any applicable law, statute, rule, regulation, decision, writ, order, decree or judgment, permit or any interpretation thereof, promulgated or issued by a Governmental Authority.
“Letter(s) of Credit” has the meaning set forth in Section 1.1 the ESSA. “Local Capacity Area Resource” has the meaning set forth in the CAISO Tariff. “Local RAR” means the local Resource Adequacy Requirements established for load-serving entities by the CAISO pursuant to the CAISO Tariff, the CPUC pursuant to the Resource Adequacy Rulings, or by any other Governmental Authority. “Local RAR” may also be known as local area reliability, local resource adequacy, local resource adequacy procurement requirements, or local capacity requirements in other regulatory proceedings or legislative actions. “Losses” means, with respect to a Project Participant assuming all or a portion of a Defaulting Project Participant’s Entitlement Share pursuant to the process set forth in Section

12.8(b) or 12.8(c), an amount equal to the present value of the economic loss to it, if any (exclusive of Costs), resulting from such Step-Up Allocation for the remaining Contract Term of the ESSA, determined in a commercially reasonable manner. Factors used in determining economic loss to such Project Participant may include, without limitation, reference to information supplied by one or more third parties, which shall exclude Affiliates of the Project Participant, 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., NP-15), all of which should be calculated for the remaining Contract Term of the ESSA and must include the value of Environmental Attributes and Capacity Attributes.
“Marketable Emission Trading Credits” means emissions trading credits or units pursuant to the requirements of California Division 26 Air Resources; Health & Safety Code Section 39616 and Section 40440.2 for market-based incentive programs such as the South Coast Air Quality Management District’s Regional Clean Air Incentives Market, also known as RECLAIM, and allowances of sulfur dioxide trading credits as required under Title IV of the Federal Clean Air Act (42 U.S.C. § 7651b (a) to (f)).
“Month” means a calendar month.
“Monthly Costs” has the meaning set forth in Section 9.1. “Monthly Capacity Payment” means the payment required to be made by CCP to Project Developer each month of the Delivery Term as compensation for the Product, as calculated in accordance with Exhibit C of the ESSA.

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“MW” means megawatts in alternating current, unless expressly stated in terms of direct current.
“MWh” means megawatt-hour measured in alternating current, unless expressly stated in terms of direct current.
“NERC” means the North American Electric Reliability Corporation. “Net Qualifying Capacity” or “NQC” has the meaning set forth in the CAISO Tariff. “Non-Defaulting Project Participant” has the meaning set forth in Section 12.1. “Normal Vote” has the meaning set forth in Exhibit D.
“Notice” shall, unless otherwise specified in the Agreement, mean written communications by a Party to be delivered by hand delivery, United States mail, overnight courier service, or electronic messaging (e-mail).
“Operating Account” means an account established by CCP for each Project Participant pursuant to Section 8.2.
“Operating Cost” means the share of the Annual Budget or Amended Annual Budget attributable to the applicable Month for a Billing Statement. “Operating Restrictions” means those restrictions, rules, requirements, and procedures set forth in Exhibit Q of the ESSA.
“Party” has the meaning set forth in the Preamble.
“Payment Default” has the meaning set forth in Section 12.2. “Payment Default Termination Deadline” has the meaning set forth in Section 12.6. “Performance Guarantees” has the meaning set forth in Section 4.3(b) of the ESSA. “Performance Security” means (i) cash or (ii) a Letter of Credit in the amount set forth on the Cover Sheet of the ESSA.
“Permitted Transferee” has the meaning set forth in Section 1.1 of the ESSA. “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 Facility. “PMIN” means the applicable CAISO-certified minimum operating level of the Facility.

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“PNode” has the meaning set forth in the CAISO Tariff.
“Product” has the meaning set forth in Section 3.1
“Progress Report” means a progress report including the items set forth in Exhibit E of the ESSA.
“Project” shall be broadly construed to entail the aggregate of rights, liabilities, interests, and obligations of CCP pursuant to the ESSA, including but not limited to all rights, liabilities, interests, and obligations associated with the Product, all rights, liabilities, interests and obligations associated with the Facility, and including all aspects of the operation and administration of the Facility and the ESSA and the rights, liabilities, interests and obligations associated therewith. “Project Committee” means the committee established in accordance with Section6.1. “Project Developer” means Tumbleweed Energy Storage, LLC, a Delaware limited liability company, or assignee as permitted under the ESSA. “Project Participants” means those entities executing this Agreement, as identified in the Preamble, together in each case with each entity’s successors or assigns. “Project Revenue Rights” means all rights of a Project Participant under this Agreement to any revenue associated with the Facility Energy or Ancillary Services associated with the Facility.
“Project Rights” means all rights and privileges of a Project Participant under this Agreement, including but not limited to its Entitlement Share, its right to receive the Product from the Facility, and its right to vote on Project Committee matters. “Project Rights and Obligations” means the Project Participants’ Project Rights and obligations under the terms of this Agreement.
“Proposed Entitlement Share Reduction Compensation Amount” has the meaning set forth in Exhibit C.
“Prudent Operating Practice” means (a) the applicable practices, methods and acts required by or consistent with applicable Laws and reliability criteria, and otherwise engaged in or approved by a significant portion of the electric industry during the relevant time period with respect to grid-interconnected, utility-scale energy storage facilities in the Western United States, and (b) any of the practices, methods and acts which, in the exercise of reasonable judgment in light of the facts known at the time the decision was made, could have been expected to accomplish the desired result at a reasonable cost consistent with good business practices, reliability, safety and expedition. Prudent Operating Practice is not intended to be limited to the optimum practice, method, or act to the exclusion of all others, but rather to acceptable practices, methods or acts generally accepted in the industry with respect to grid-interconnected, utility-scale energy storage facilities in the Western United States. Prudent Operating Practice shall include compliance with applicable Laws, applicable safety and reliability criteria, and the applicable criteria, rules and standards promulgated in the National Electric Safety Code and the National Electrical Code, as Item 5
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they may be amended or superseded from time to time, including the criteria, rules, and standards of any successor organizations.
“Qualifying Capacity” has the meaning set forth in the CAISO Tariff. “RA Compliance Showing” means the (a) Local RAR compliance or advisory showings (or similar or successor showings), (b) RAR compliance or advisory showings (or similar or successor showings), and (c) Flexible RAR compliance or advisory showings (or similar successor showings), in each case, an entity is required to make to the CAISO pursuant to the CAISO Tariff, to the CPUC (and, to the extent authorized by the CPUC, to the CAISO) pursuant to the Resource Adequacy Rulings, or to any Governmental Authority.
“RA Deficiency Amount” has the meaning set forth in Section 1.1 of the ESSA. “RA Guarantee Date” means the date by which the Facility is expected to achieve Full Capacity Deliverability Status, which is the Commercial Operation Date. “RA Shortfall Month” has the meaning set forth in Section 1.1 of the ESSA. “Real-Time Market” has the meaning set forth in the CAISO Tariff. “Receiving Party” has the meaning set forth in Section 18.2 of the ESSA. “Reliability Network Upgrades” has the meaning set forth in the CAISO Tariff. “Remedial Action Plan” has the meaning set forth in Section 2.4 of the ESSA. “Replacement RA” has the meaning set forth in Section 1.1 of the ESSA. “Resource Adequacy Benefits” means the rights and privileges attached to the Facility that satisfy any entity’s Resource Adequacy Requirements, as those obligations are set forth in any ruling issue by a Governmental Authority, including the Resource Adequacy Rulings and shall include Flexible Capacity, and any local, zonal or otherwise locational attributes associated with the Facility.
“Resource Adequacy Requirements” or “RAR” means the resource adequacy requirements applicable to an entity as established by the CAISO pursuant to the CAISO Tariff, by the CPUC pursuant to the Resource Adequacy Rulings, or by any other Governmental Authority.
“Resource Adequacy Resource” has the meaning used in Resource Adequacy Rulings. “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, 20-06-031, 20-06- 028, 20-12-006, 21-06-035 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 Item 5
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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. “Schedule” has the meaning set forth in the CAISO Tariff, and “Scheduled” has a corollary meaning.
“Scheduled Energy” means the Facility Energy that clears under the applicable CAISO market based on the final Day-Ahead Schedule(s), FMM Schedule(s) (as defined in the CAISO Tariff), and/or any other financially binding Schedule(s), market instruction or dispatch for the Facility for a given period of time implemented in accordance with the CAISO Tariff. “Scheduling Coordinator” or “SC” means an entity certified by the CAISO as qualifying as a Scheduling Coordinator pursuant to the CAISO Tariff for the purposes of undertaking the functions specified in “Responsibilities of a Scheduling Coordinator,” of the CAISO Tariff, as amended from time to time.
“Scheduling Coordinator Services Agreement” means the agreement between CCP and a Scheduling Coordinator that was approved by the CCP Board pursuant to Section 5.2(a)(xiii). “Settlement Interval” has the meaning set forth in the CAISO Tariff. “Settlement Period” has the meaning set forth in the CAISO Tariff. “Shared Facilities” means the gen-tie lines, transformers, substations, or other equipment, permits, contract rights, and other assets and property (real or personal), in each case, as necessary to enable delivery of Facility 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 the Project Developer for electric generation or storage facilities owned by Project Developer other than the Facility.
“Showing Month” means the calendar month of the Delivery Term, commencing with the Showing Month that contains the RA Guarantee Date, that is the subject of the RA Compliance Showing, as set forth in the Resource Adequacy Rulings and outlined in the CAISO Tariff. For illustrative purposes only, pursuant to the CAISO Tariff and Resource Adequacy Rulings in effect as of the Effective Date, the monthly RA Compliance Showing made in June is for the Showing Month of August.
“Site” has the meaning set forth in Section 1.1 of the ESSA, as further described in Exhibit A of the ESSA.
“Station Use” means the Energy that is used within the Facility to power the lights, motors, temperature control systems, control systems and other electrical loads that are necessary for operation of the Facility.
“Step-Up Allocation Cap” has the meaning set forth in Section 12.8(a). “Step-Up Invoice” means an invoice sent to a Non-Defaulting Project Participant as a result of a Defaulting Project Participant’s Payment Default, which invoice shall separately Item 5
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identify any amount owed with respect to the monthly Billing Statement of the Defaulting Project Participant, as the case may be, pursuant to Section 12.7. “Step-Up Invoice Amount” has the meaning set forth in Section 12.7. “Step-Up Invoice Amount Cap” has the meaning set forth in Section 12.7. “Step-Up Reserve Account” has the meaning set forth in Section 12.7(a)(i). “Storage Level” means, at a particular time, the amount of electric Energy in the Facility available to be discharged as Facility Energy, expressed in MWh. “System Emergency” means any condition that requires, as determined, and declared by CAISO or the Transmission Provider, automatic or immediate action to (i) prevent or limit harm to or loss of life or property, (ii) prevent loss of transmission facilities or generation supply in the immediate vicinity of the Facility, or (iii) to preserve Transmission System reliability. “Tax” or “Taxes” means all U.S. federal, state and local, and any foreign taxes, levies, assessments, surcharges, duties and other fees and charges of any nature imposed by a Governmental Authority, whether currently in effect or adopted during the Contract Term, including ad valorem, excise, franchise, gross receipts, import/export, license, property, sales and use, stamp, transfer, payroll, unemployment, income, and any and all items of withholding, deficiency, penalty, additions, interest or assessment related thereto. “Tax Credits” means any state, local and/or federal production tax credit, depreciation benefit, tax deduction and/or investment tax credit, including the ITC, specific to investments in renewable energy facilities and/or energy storage facilities. “Terminated Transaction” has the meaning set forth in Section 11.2(a) the ESSA. “Termination Payment” has the meaning set forth in Section 11.3 of the ESSA. “Transmission Provider” means any 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 for the purpose of transmitting or transporting the Facility Energy from the Delivery Point. “Transmission System” means the transmission facilities operated by the CAISO, now or hereafter in existence, which provide energy transmission service downstream from the Delivery Point.
“Unanimous Vote” has the meaning set forth in Exhibit D. “Uncontrollable Forces” means any Force Majeure event and any cause beyond the control of any Party, which by the exercise of due diligence such Party is unable to prevent or overcome, including but not limited to, failure or refusal of any other Person to comply with then existing contracts, an act of God, fire, flood, explosion, earthquake, strike, sabotage, epidemic or pandemic (excluding impacts of the disease designated COVID-19 or the related virus designated Item 5
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SARS-CoV-2 impacts actually known by the Party claiming the Force Majeure Event as of the Effective Date), an act of the public enemy (including terrorism), civil or military authority including court orders, injunctions and orders of governmental agencies with proper jurisdiction or the failure of such agencies to act, insurrection or riot, an act of the elements, failure of equipment, a failure of any governmental entity to issue a requested order, licenseor permit, inability of any Party or any Person engaged in work on the Project to obtain or ship materials or equipment because of the effect of similar causes on suppliers or carriers. Notwithstanding the foregoing, Uncontrollable Forces as defined herein shall also include events of Force Majeure pursuant to the ESSA, as defined therein.

1.2. Rules of Interpretation. In this Agreement, except as expressly stated otherwise or unless the context otherwise requires:
(a) headings and the rendering of text in bold and italics are for convenience and reference purposes only and do not affect the meaning or interpretation of this Agreement; (b) words importing the singular include the plural and vice versa and the masculine, feminine and neuter genders include all genders; (c) the words “hereof”, “herein”, and “hereunder” and words of similar import shall refer to this Agreement as a whole and not to any particular provision of this Agreement; (d) a reference to an Article, Section, paragraph, clause, Party, or Exhibit is a reference to that Article, Section, paragraph, clause of, or that Party or Exhibit to, this Agreement unless otherwise specified;
(e) a reference to a document or agreement, including this Agreement shall mean such document, agreement or this Agreement including any amendment or supplement to, or replacement, novation, or modification of this Agreement, but disregarding any amendment, supplement, replacement, novation or modification made in breach of such document, agreement or this Agreement;
(f) a reference to a Person includes that Person’s successors and permitted assigns;
(g) the terms “include” and “including” mean “include or including (as applicable) without limitation” and any list of examples following such term shall in no way restrict or limit the generality of the word or provision in respect of which such examples are provided;
(h) references to any statute, code or statutory provision are to be construed as a reference to the same as it may have been, or may from time to time be, amended, modified, or reenacted, and include references to all bylaws, instruments, orders and regulations for the time being made thereunder or deriving validity therefrom unless the context otherwise requires; (i) in the event of a conflict, a mathematical formula or other precise description of a concept or a term shall prevail over words providing a more general description of a concept or a term;
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(j) references to any amount of money shall mean a reference to the amount in United States Dollars;
(k) the expression “and/or” when used as a conjunction shall connote “any or all of”;
(l) words, phrases or expressions not otherwise defined herein that (i) have a generally accepted meaning in Prudent Operating Practice shall have such meaning in this Agreement or (ii) do not have well known and generally accepted meaning in Prudent Operating Practice but that have well known and generally accepted technical or trade meanings, shall have such recognized meanings;
(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; and
(n) in the event of any conflict or inconsistency between the terms of this Agreement and the terms of the ESSA or the Coordinated Operations Agreement, the terms and provisions of this Agreement shall control.

ARTICLE 2

EFFECTIVE DATE AND TERM

2.1. Term.
(a) The term of this Agreement shall commence on the Effective Date and shall remain in full force and effect until the occurrence of all of the following: (i) the termination of the ESSA and (ii) the termination of the Buyer Liability Pass Through Agreement for all the Project Participants, and (iii) all Parties have met their obligations under this Agreement (“Term”). (b) Applicable provisions of this Agreement shall continue in effect after termination to the extent necessary to enforce or complete the duties, obligations or responsibilities of the Parties arising prior to termination. All indemnity and audit rights shall remain in full force and effect for three (3) years following the termination of this Agreement.

ARTICLE 3

AGREEMENT

3.1. Transaction. Subject to the terms and conditions of this Agreement, the Project Participants authorize CCP to purchase all Facility Energy, Capacity Attributes, Ancillary Services, and Environmental Attributes associated with the Facility and any Replacement RA provided pursuant to the ESSA (collectively the “Product”), on behalf of the Project Participants.

Pursuant to the procedures set forth in the Coordinated Operations Agreement, CCP shall cause Project Developer to deliver each Project Participant’s Entitlement Share of the Product to such Project Participant, including but not limited to (i) any revenue associated with the Facility Energy, Capacity Attributes, Ancillary Services, or Environmental Attributes associated with the Facility, and (ii) the Capacity Attributes and Environmental Attributes associated with the Facility or Item 5
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otherwise provided to CCP pursuant to the ESSA. CCP shall administer the ESSA and oversee the operation of the Project. CCP shall not sell, assign, or otherwise transfer any Product, or any portion thereof, to any third party other than to the Project Participants, unless authorized by the Project Participants pursuant to this Agreement.

ARTICLE 4

ENTITLEMENT SHARE

4.1. Initial Entitlement Share. Each Project Participant’s initial Entitlement Share as of the Effective Date shall be set forth in Column B of the Table provided in Exhibit B of this Agreement (entitled “Schedule of Project Participant Entitlement Shares and Step-Up Allocation Caps”). Any revisions to the Entitlement Share specified in Exhibit B pursuant to Section 4.2. or Section 12.8 shall be considered an element of the administration of this Agreement and shall not require the consent of the Parties hereto.

4.2. Change of Entitlement Share. Any Project Participant may reduce its Entitlement Share of the Project pursuant to the process set forth in Exhibit C.

4.3. Reduction of Entitlement Share to Zero. If any Project Participant’s Entitlement Share is reduced to zero through any process specified in Exhibit C, such Project Participant shall remain a Party to this Agreement and shall be subject to all rights, obligations, and liabilities of this Agreement, including but not limited to any liabilities for Monthly Capacity Payments, Damage Payment or Termination Payment, as applicable, and any other damage payments or reimbursement amounts under the ESSA.

ARTICLE 5
OBLIGATIONS OF CCP; ROLE OF CCP BOARD AND CCP MANAGER

5.1. Obligations of CCP.
(a) CCP shall take such commercially reasonable actions or implement such commercially reasonable measures as may be necessary or desirable for the utilization, maintenance, or preservation of the rights and interests of the Project Participants in the Project including, if appropriate, such enforcement actions or other measures as the Project Committee or CCP Board deems to be in the Project Participants’ best interests. To the extent not inconsistent with the ESSA or other applicable agreements, CCP may also be authorized by the Project Participants to assume responsibilities for planning, designing, financing, developing, acquiring, insuring, contracting for, administering, operating, and maintaining the Project to effectuate the conveyance of the Product to Project Participants in accordance with Project Participants’ Entitlement Shares.
(b) To the extent such services are available and can be carried forth in accordance with the ESSA, CCP shall also provide such other services, as approved by the Project Committee or CCP Board, as may be deemed necessary to secure the benefits and/or satisfy the obligations associated with the ESSA.
(c) Adoption of Annual Budget. The Annual Budget and any amendments to the Annual Budget shall be prepared and approved in accordance with this Section 5.1(c).

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(i) The CCP Manager will prepare and submit to the Project Committee a proposed Annual Budget at least ninety (90) days prior to the beginning of each Contract Year during the term of this Agreement. The proposed Annual Budget shall be based on the prior Contract Year’s actual costs and shall include reasonable estimates of the costs CCP expects to incur during the applicable Contract Year in association with the administration of the ESSA, including the cost of insurance coverages that are determined to be attributable to the Project by action of the CCP Board. Upon approval of the proposed Annual Budget by a Normal Vote of the Project Committee, the CCP Manager shall present the proposed Annual Budget to the CCP Board.

The CCP Board shall adopt the Annual Budget no later than thirty (30) days prior to the beginning of such Contract Year and shall cause copies of such adopted Annual Budget to be delivered to each Project Participant.
(ii) At any time after the adoption of the Annual Budget for a Contract Year, the CCP Manager may prepare and submit to the Project Committee a proposed Amended Annual Budget for and applicable to the remainder of such Contract Year. The proposal shall (A) explain why an amendment to the Annual Budget is needed, (B) compare estimated costs against actual costs, and (C) describe the events that triggered the need for additional funding. Upon approval of the proposed Amended Annual Budget by a Normal Vote of the Project Committee, the CCP Manager shall present the proposed Amended Annual Budget to the CCP Board. Upon adoption of the Amended Annual Budget by the CCP Board, such Amended Annual Budget shall apply to the remainder of the Contract Year and the CCP Board shall cause copies of such adopted Amended Annual Budget to be delivered to each Project Participant. (iii) Reports. CCP will prepare and issue to Project Participants the following reports each quarter of a year during the Term:
(A) Financial and operating statement relating to the Project. (B) Variance report comparing the costs in the Annual Budget versus actual costs, and the status of other cost-related issues with respect to the Project. (d) Records and Accounts. CCP will keep, or cause to be kept, accurate records and accounts of the Project as well as of the operations relating to the Project, all in a manner similar to accepted accounting methodologies associated with similar projects. All transactions of CCP relating to the Project with respect to each Contract Year shall be subject to an annual audit.

Each Project Participant shall have the right at its own expense to examine and copy the records and accounts referred to above on reasonable notice during regular business hours. (e) Information Sharing. Upon CCP’s request, each Project Participant agrees to coordinate with CCP to provide such information, documentation, and certifications that are reasonably necessary for the design, financing, refinancing, development, operation, administration, maintenance, and ongoing activities of the Project, including information required to respond to requests for such information from any federal, state, or local regulatory body or other authority.
(f) Consultants and Advisors Available. CCP shall make available to the Project Committee all consultants and advisors, including financial advisors and legal counsel that Item 5
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are retained by CCP, and such consultants, counsel and advisors shall be authorized to consult with and advise the Project Committee on Project matters. CCP agrees to waive any conflicts of interest or any other applicable professional standards or rules as required by consultants, counsel, and advisors to advise the Project Committee on Project matters. (g) Deposit of Insurance Proceeds. CCP shall promptly deposit any insurance proceeds received by CCP from any insurance obtained pursuant to this Agreement or otherwise associated with the Project into the Operating Accounts of the Project Participants based on each Project Participants’ Entitlement Shares.
(h) Liquidated and Other Damages. Any amounts paid to CCP, or applied against payments otherwise due by CCP pursuant to the ESSA or each Project Participant’s respective BLPTA, by the Project Developer shall be deposited on a pro rata share, based on each Project Participant’s Entitlement Share into each Project Participant’s Operating Account.

Liquidated Damages include, but are not limited to Daily Delay Damages, RA Deficiency Amount, Damage Payment, and Termination Payment.
(i) Charging and Discharging Energy. Subject to the direction of the Project Committee, CCP shall reasonably coordinate, schedule, and do all other things necessary or appropriate, except as otherwise prohibited under this Agreement, to provide for the delivery of Charging Energy from the grid to the Point of Delivery to enable CCP to exercise its rights and obligations in connection with Charging Energy in accordance with the requirements of the ESSA.

Subject to the direction of the Project Committee, CCP shall reasonably coordinate, schedule, and do all other things necessary or appropriate, except as otherwise prohibited under this Agreement, to provide for the delivery of Discharging Energy from the Point of Delivery to the grid to enable CCP to maximize the value of the ESSA to the Project Participants in accordance with the requirements of the ESSA.
(j) Resale of Product. Any Project Participant may direct CCP to remarket such Project Participant’s Entitlement Share of the Product, or such Project Participant’s Entitlement Share of any part of the Product. If CCP incurs any expenses associated with the remarketing activities pursuant to this Section 5.1(j), then CCP shall include the total amount of such expenses as a Monthly Cost on the Project Participant’s next Billing Statement. Prior to offering the Project Participant’s Entitlement Share of the Product, or the Project Participant’s Entitlement Share of any part of the Product to any third party, CCP shall first offer the Product or portion of the Product to the other Project Participants. The amount of compensation paid to the selling Project Participant shall be negotiated and agreed to between the selling Project Participant and the purchasing Project Participant or third party. Any payments for any resold Product pursuant to this Section 5.1(j) shall be transmitted directly from the purchasing Project Participant or purchasing third party to the reselling Project Participant. Any such resale to a third party shall not convey any rights or authority over the operation of the Project, and the Project Participant shall not make a representation to the third party that the resale conveys any rights or authority over the operation of the Project.
(k) Uncontrollable Forces. CCP shall not be required to provide, and CCP shall not be liable for failure to provide, the Product, Replacement RA, or other service under this Agreement when such failure, or the cessation or curtailment of, or interference with, the Item 5
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service is caused by Uncontrollable Forces or by the failure of the Project Developer, or its successors or assigns, to obtain any required governmental permits, licenses, or approvals to acquire, administer, or operate the Project; provided, however, that the Project Participants shall not thereby be relieved of their obligations to make payments under this Agreement except to the extent CCP is so relieved pursuant to the ESSA, and provided further that CCP shall pursue all applicable remedies against the Project Developer under the ESSA and distribute any remedies obtained pursuant to Section 5.1(h).
(l) Insurance. Within one hundred and eighty days (180) of the Effective Date of this Agreement, CCP shall secure and maintain, during the Term, insurance coverage as follows:
(i) Commercial General Liability. CCP shall maintain, or cause to be maintained, commercial general liability insurance, including products and completed operations and personal injury insurance, in a minimum amount of One Million Dollars ($1,000,000) per occurrence, and an annual aggregate of not less than Two Million Dollars ($2,000,000), endorsed to provide contractual liability in said amount, specifically covering CCP’s obligations under this Agreement and including each Project Participant as an additional insured. (ii) Employer’s Liability Insurance. CCP, if it has employees, shall maintain Employers’ Liability insurance with limits of not less than One Million Dollars ($1,000,000.00) for injury or death occurring as a result of each accident. With regard to bodily injury by disease, the One Million Dollar ($1,000,000) policy limit will apply to each employee. (iii) Workers’ Compensation Insurance. CCP, if it has employees, shall also maintain at all times during the Term workers’ compensation and employers’ liability insurance coverage in accordance with statutory amounts, with employer’s liability limits of not less than One Million Dollars ($1,000,000.00) for each accident, injury, or illness; and include a blanket waiver of subrogation.
(iv) Business Auto Insurance. CCP shall maintain at all times during the Term business auto insurance for bodily injury and property damage with limits of One Million Dollars ($1,000,000) per occurrence. Such insurance shall cover liability arising out of CCP’s use of all owned (if any), non-owned and hired vehicles, including trailers or semi-trailers in the performance of the Agreement and shall name each Project Participant as an additional insured and contain standard cross-liability and severability of interest provisions. (v) Public Entity Liability Insurance. CCP shall maintain public entity liability insurance, including public officials’ liability insurance, public entity reimbursement insurance, and employment practices liability insurance in an amount not less than One Million Dollars ($1,000,000) per claim, and an annual aggregate of not less than One Million Dollars ($1,000,000) and CCP shall maintain such coverage for at least two (2) years from the termination of this Agreement.
(m) Evidence of Insurance. Within ten (10) days after the deadline for securing insurance coverage specified in Section 5.1(l), and upon annual renewal thereafter, CCP shall deliver to each Project Participant certificates of insurance evidencing such coverage with insurers with ratings comparable to A-VII or higher, and that are authorized to do business in the State of Item 5
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California, in a form evidencing all coverages set forth above. Such certificates shall specify that each Project Participant shall be given at least thirty (30) days prior Notice by CCP in the event of cancellation or termination of coverage. Such insurance shall be primary coverage without right of contribution from any insurance of each Project Participant. Any other insurance maintained by CCP not associated with this Agreement is for the exclusive benefit of CCP and shall not in any manner inure to the benefit of Project Participants. The general liability, auto liability and worker’s compensation policies shall be endorsed with a waiver of subrogation in favor of each Project Participant for all work performed by CCP, its employees, agents and sub-contractors.

5.2. Role of CCP Board.
(a) The rights and obligations of CCP under the ESSA shall be subject to the ultimate control at all times of the CCP Board. The CCP Board, shall have, in addition to the duties and responsibilities set forth elsewhere in this Agreement, the following duties and responsibilities, among others:
(i) Dispute Resolution. The CCP Board shall review, discuss and attempt to resolve any disputes among CCP, any of the Project Participants, and the Project Developer relating to the Project, the operation and management of the Facility, and CCP’s rights and interests in the Facility.
(ii) ESSA. The CCP Board shall have the authority to review, modify, and approve, as appropriate, all amendments, modifications, and supplements to the ESSA. (iii) Capital Improvements. The CCP Board shall review, modify, and approve, if appropriate, all Capital Improvements undertaken with respect to the Project and all financing arrangements for such Capital Improvements. The CCP Board shall approve those budgets or other provisions for the payments associated with the Project and the financing for any development associated with the Project.
(iv) Committees. The CCP Board shall exercise such review, direction, or oversight as may be appropriate with respect to the Project Committee and any other committees established pursuant to this Agreement.
(v) Budgeting. Upon the submission of a proposed Annual Budget or proposed Amended Annual Budget, approved by a Normal Vote of the Project Committee, the CCP Board shall review, modify, and approve each Annual Budget and Amended Annual Budget in accordance with Section 5.1(c) of this Agreement.
(vi) Early Termination of ESSA. The CCP Board shall review, modify, and approve the recommendations of the Project Committee, made pursuant to Section 6.4(b)(ii) of this Agreement, as to an early termination of the ESSA pursuant to Section 11.2 of the ESSA. (vii) Assignment by Project Developer. The CCP Board shall review, modify, and approve the recommendations of the Project Committee, made pursuant to Section

6.4(b)(iii) of this Agreement, as to any assignment by Project Developer pursuant to Section 14.1 of the ESSA other than any assignment pursuant to Sections 14.2 or 14.3 of the ESSA.

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(viii) Buyer Financing Assignment. The CCP Board shall review, modify, and approve the recommendations of the Project Committee, made pursuant to Section 6.4(b)(iv) of this Agreement, as to an assignment by CCP to a financing entity pursuant to Section 14.5 of the ESSA.
(ix) Change of Control. The CCP Board shall review, modify, and approve the recommendations of the Project Committee, made pursuant to Section 6.4(b)(v) of this Agreement, as to any Change of Control requiring CCP’s consent, as specified in Section 14.1 of the ESSA.
(x) Supervening Authority of the Board. The CCP Board has complete and plenary supervening power and authority to act upon any matter which is capable of being acted upon by the Project Committee or which is specified as being within the authority of the Project Committee pursuant to the provisions of this Agreement. (xi) Other Matters. The CCP Board is authorized to perform such other functions and duties, including oversight of those matters and responsibilities addressed by the Project Committee or CCP Manager as may be provided for under this Agreement and under the ESSA, or as may otherwise be appropriate.
(xii) Periodic Audits. The CCP Board or the Project Committee may arrange for the annual audit by certified accountants, selected by the CCP Board and experienced in electric generation or electric utility accounting, of the books and accounting records of CCP, the Project Developer to the extent authorized under the ESSA, and any other counterparty under any agreement to the extent allowable, and such audit shall be completed and submitted to the CCP Board as soon as reasonably practicable after the close of the Contract Year. CCP shall promptly furnish to the Project Participant copies of all audits. No more frequently than once every calendar year, each Project Participant may, at its sole cost and expense, audit, or cause to be audited the books and cost records of CCP, and/or the Project Developer to the extent authorized under the ESSA.
(xiii) Scheduling Coordinator Services Agreement. Upon a recommendation by Normal Vote of the Project Committee pursuant to Section 6.4(b)(vi), the CCP Board shall review, modify, and approve, or delegate the authority to approve, a Scheduling Coordinator Services Agreement or amendment thereto.
(b) Pursuant to Section 5.06 of the Joint Powers Agreement, this Agreement modifies the voting rules of the CCP Board for purposes of approving or acting on any matter identified in this Agreement, as follows:
(i) Quorum. A quorum shall consist of a majority of the CCP Board members that represent Project Participants.
(ii) Voting. Each CCP Board member that represents a Project Participant shall have one vote for any matter identified in this Agreement. Any CCP Board member representing a CCP member that is not a Project Participant shall abstain from voting on any matter identified in this Agreement. A vote of the majority of the CCP Board members Item 5
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representing Project Participants that are in attendance shall be sufficient to constitute action, provided a quorum is established and maintained.

5.3. Role of CCP Manager.
(a) In addition to the duties and responsibilities set forth elsewhere in this Agreement, the CCP Manager is delegated the following authorities and responsibilities:
(i) Request for Tax Documentation. Respond to any requests for tax-related documentation by the Project Developer. (ii) Request for Financial Statements. Provide the Project Developer with Financial Statements as may be required by the ESSA. (iii) Request for Information by Project Participant. Respond to any request by a Project Participant for information or documents that are reasonably available to allow the Project Participant to respond to requests for such information from any federal, state, or local regulatory body or other authority.
(iv) Coordinate Response to a Request for Confidential Information.

Upon a request or demand by any third person that is not a Party to the ESSA or a Project Participant, for Confidential Information as described in Section 18.2 of the ESSA, the CCP Manager shall notify the Project Developer and coordinate the response of CCP and Project Participants.
(v) Invoices. The CCP Manager shall review each invoice submitted by Project Developer and shall request such other data necessary to support the review of such invoices.

ARTICLE 6

PROJECT COMMITTEE

6.1. Establishment and Authorization of the Project Committee. The Project Committee is hereby established and duly authorized to act on behalf of the Project Participants as provided for in this Section 6 for the purpose of (a) providing coordination among, and information to, the Project Participants and CCP, (b) making any recommendations to the CCP Board regarding the administration of the Project, and (c) execution of the Project Committee responsibilities set forth in Section 6.4.

6.2. Project Committee Membership. The Project Committee shall consist of one representative from each Project Participant. The CCP Manager shall be a non-voting member of the Project Committee. Within thirty (30) days after the Effective Date, each Project Participant shall provide notice to each other of such Project Participant’s representative on the Project Committee. Alternate representatives may be appointed by similar written notice to act on the Project Committee, or on any subcommittee established by the Project Committee, in the absence of the regular representative. An alternate representative may attend all meetings of the Project Committee but may vote only if the representative for whom they serve as alternate for is absent.

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No Project Participant’s representative shall exercise any greater authority than permitted by the Project Participant which they represent.

6.3. Project Committee Operations, Meetings, and Voting. Project Committee operations, meetings, and voting shall be in accordance with the procedures and requirements specified in Exhibit D.

6.4. Project Committee Responsibilities. The Project Committee shall have the following responsibilities:
(a) General Responsibilities of the Project Committee.
(i) Provide a liaison between CCP and the Project Participants with respect to the ongoing administration of the Project.
(ii) Exercise general supervision over any subcommittee established pursuant to Section 6.5.
(iii) Oversee, as appropriate, the completion of any Project design, feasibility, or planning studies or activities.
(iv) Review, discuss, and attempt to resolve any disputes among the Project Participants relating to this Agreement or the ESSA. (v) Perform such other functions and duties as may be provided for under this Agreement, the ESSA, or as may otherwise be appropriate or beneficial to the Project or the Project Participants.
(b) Recommendations to the CCP Board by a Normal Vote.
(i) Budgeting. Review, modify, and approve by a Normal Vote each proposed Annual Budget and proposed Amended Annual Budget for submission to the CCP Board for final approval.
(ii) Early Termination of ESSA. Review, modify, and approve by a Normal Vote a recommendation to the CCP Board regarding an early termination of the ESSA pursuant to Section 11.2 of the ESSA.
(iii) Assignment by Project Developer. Review, modify, and approve by a Normal Vote a recommendation to the CCP Board regarding any assignment by Project Developer pursuant to Section 14.1 of the ESSA other than any assignment pursuant to Sections

14.2 or 14.3 of the ESSA.
(iv) Buyer Financing Assignment. Review, modify, and approve by a Normal Vote a recommendation to the CCP Board regarding an assignment by CCP to a financing entity pursuant to Section 14.5 of the ESSA.

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(v) Change of Control. Review, modify, and approve by a Normal Vote a recommendation to the CCP Board regarding any Change of Control requiring CCP’s consent, as specified in Section 14.1 of the ESSA.
(vi) Scheduling Coordinator. Review, modify, and approve by a Normal Vote a recommendation to the CCP Board regarding the selection of a Scheduling Coordinator and the form of the Scheduling Coordinator Services Agreement, including any amendments thereto. Such Scheduling Coordinator Services Agreement shall: (i) require that the scheduling and dispatch of the Project is in accordance with the criteria set forth in Exhibit C of the Coordinated Operations Agreement; (ii) include the Scheduling Coordinator responsibilities specified in Exhibit D of the Coordinated Operations Agreement; and (iii) address requirements relating to CAISO settlements, the Operating Restrictions, and communications and reporting from the Scheduling Coordinator to the Project Participants. (c) Actions Delegated to the Project Committee by this Agreement Subject to a Unanimous Vote.
(i) Project Design. Review, modify, and approve by a Unanimous Vote any recommendations to the Project Developer on the design of the Project. (ii) Extension of Guaranteed Construction Start Date and Guaranteed Commercial Operation Date. Review and confirm that requirements of Exhibit B of the ESSA have been satisfied, such that the Guaranteed Construction Start Date and/or Guaranteed Commercial Operation Date has been extended.
(iii) Event of Default. Direct CCP to exercise its rights under the ESSA if an Event of Default has occurred under Section 11.1 of the ESSA or under the Scheduling Coordinator Services Agreement.
(d) Actions Delegated to the Project Committee by this Agreement Subject to a Normal Vote.
(i) Make recommendations to the CCP Manager, the CCP Board, the Project Participants or to the Project Developer, as appropriate, with respect to the development, operation, and ongoing administration of the Project.
(ii) Review, develop, and, if appropriate, modify and approve rules, procedures, and protocols for the administration of the Project, including rules, procedures, and protocols for the management of the costs of the Facility and the scheduling, handling, tagging, dispatching, and crediting of the Product, the handling and crediting of Environmental Attributes associated with the Facility and the control and use of the Facility. (iii) Review, develop, and, if appropriate, modify rules, procedures, and protocols for the monitoring, inspection, and the exercise of due diligence activities relating to the operation of the Facility.
(iv) Review, and, if appropriate, modify or otherwise act upon, the form or content of any written statistical, administrative, or operational reports, Facility-related data and Item 5
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storage information, technical information, facility reliability data, transmission information, forecasting, scheduling, dispatching, tagging, parking, firming, exchanging, balancing, movement, or other delivery information, and similar information and records, or matters pertaining to the Project which are furnished to the Project Committee by the CCP Manager, the Project Developer, experts, consultants or others.
(v) Review, formulate, and, if appropriate, modify, or otherwise act upon, practices and procedures to be followed by Project Participants for, among other things, the production, scheduling, tagging, transmission, delivery, firming, balancing, exchanging, crediting, tracking, monitoring, remarketing, sale, or disposition of the Product, including the control and use of the Facility, and the supply, scheduling, and use of Charging Energy. (vi) Review and act upon any matters involving any arrangements and instruments entered into by the Project Developer or any affiliate thereof to, among other things, secure certain performance requirements, including, but not limited to, the ESSA, the Development Security or the Performance Security and any other letter of credit delivered to, or for the benefit of, CCP by the Project Developer and take such actions or make such recommendations as may be appropriate or desirable in connection therewith. (vii) Review, and, if appropriate, recommend, modify, or approve policies or programs formulated by CCP or Project Developer for determining or estimating storage resources or the values, quantities, volumes, or costs of the Product from the Facility. (viii) Review, and where appropriate, recommend the implementation of metering technologies and methodologies appropriate for the delivery, accounting for, transferring and crediting of the Product to the Point of Delivery (directly or through the Facility). (ix) Review, to the extent permitted by this Agreement, the ESSA, or any other relevant agreement relating to the Project, modify and approve or disapprove the specifications, vendors’ proposals, bid evaluations, or any other matters with respect to the Facility.
(x) Review and approve any Remedial Action Plan submitted by Project Developer to CCP pursuant to Section 2.4 of the ESSA.
(xi) Review and approve the submission of the written
acknowledgement of the Commercial Operation Date in accordance with Section 2.2 of the ESSA. (xii) Review and approve the return of the Development Security to Project Developer in accordance with Section 8.7 of the ESSA. (xiii) Review and approve the return of any unused Performance Security to Project Developer in accordance with Section 8.8 of the ESSA. (xiv) Review Progress Reports provided by Project Developer to CCP pursuant to Section 2.3 of the ESSA and participate in any associated regularly scheduled meetings with Project Developer to discuss construction progress.

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(xv) Direct CCP to collect any liquidated damages owed by Project Developer to CCP under the ESSA, and to the extent authorized by ESSA, draw upon the Development Security or Performance Security.
(xvi) Review invoices received by CCP from the Project Developer and, if appropriate, direct CCP to dispute an invoice pursuant to Section 8.5 of the ESSA. (xvii) Review invoices received by CCP from the Scheduling Coordinator and, if appropriate, direct CCP to collect any damages owed by the Scheduling Coordinator to CCP under the Scheduling Coordinator Services Agreement or to take any action permitted by law to enforce its rights under the Scheduling Coordinator Services Agreement, including but not limited to bringing any suit, action or proceeding at law or in equity as may be necessary or appropriate to recover damages and/or enforce any covenant, agreement, or obligation against the Scheduling Coordinator.

6.5. Subcommittees. The CCP Manager may establish as needed subcommittees including, but not limited to, auditing, legal, financial, engineering, mechanical, weather, geologic, diurnal, barometric, meteorological, operating, insurance, governmental relations, environmental, and public information subcommittees. The authority, membership, and duties of any subcommittee shall be established by the CCP Manager; provided, however, such authority, membership or duties shall not conflict with the provisions of the ESSA or this Agreement.

6.6. Representative’s Expenses. Any expenses incurred by any representative of any Project Participant or group of Project Participants serving on the Project Committee or any other committee in connection with their duties on such committee shall be the responsibility of the Project Participant which they represent and shall not be an expense payable under this Agreement.

6.7. Inaction by Committee. It is recognized by CCP and Project Participants that if the Project Committee is unable or fails to agree with respect to any matter or dispute which it is authorized to determine, resolve, approve, disapprove or otherwise act upon after a reasonable opportunity to do so, or within the time specified herein or in the ESSA, then CCP may take such commercially reasonable action as CCP determines is necessary for its timely performance under any requirement pursuant to the ESSA or this Agreement, pending the resolution of any such inability or failure to agree, but nothing herein shall be construed to allow CCP to act in violation of the express terms of the ESSA or this Agreement.

6.8. Delegation. To secure the effective cooperation and interchange of information in a timely manner in connection with various administrative, technical, and other matters which may arise from time to time in connection with administration of the ESSA, in appropriate cases, duties and responsibilities of the CCP Board or the Project Committee, as the case may be under this Section 6, may be delegated to the CCP Manager by the CCP Board upon notice to the Project Participants.

ARTICLE 7

OPERATING COMMITTEE

7.1. Operating Committee. The Operating Committee is established through the Coordinated Operations Agreement, as may be subsequently amended.

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7.2. Operating Committee Responsibilities. In addition to any specific roles and responsibilities identified in the Coordinated Operations Agreement, the Project Committee may, through a Normal Vote, assign additional tasks to the Operating Committee as long as such additional tasks are within the scope of the Operating Committee’s authority set forth in the Coordinated Operations Agreement.

ARTICLE 8

OPERATING ACCOUNT

8.1. Calculation of Estimated Monthly Project Cost.
(a) No later than one hundred and eighty (180) days after the Effective Date, the CCP Manager shall present to the Project Committee a proposed Estimated Monthly Project Cost, which shall be equal to a forecast of expected Monthly Capacity Payments over an entire Contract Year, divided by twelve (12). The Project Committee shall review, and, if appropriate, recommend, modify, or approve through a Normal Vote, the proposed Estimated Monthly Project Cost.

8.2. Operating Account. CCP shall establish an Operating Account for each Project Participant that is accessible to and can be drawn upon by both CCP and the applicable Project Participant. Such Operating Accounts are for the purpose of providing a reliable source of funds for the payment obligations of the Project and, taking into account the variability of costs associated with the Project for the purpose of providing a reliable payment mechanism to address the ongoing costs associated with the Project.
(a) Operating Account Amount. The Operating Account Amount for each Project Participant shall be an amount equal to the Estimated Monthly Project Cost multiplied by three, the product of which is multiplied by such Project Participant’s Entitlement Share (“Operating Account Amount”).
(b) Initial Funding of Operating Account. By no later than three hundred and sixty-five (365) days after the Effective Date, each Project Participant shall deposit into such Project Participant’s Operating Account an amount equal to that Project Participant’s Operating Account Amount.
(c) Use of Operating Account. CCP shall draw upon each Project Participant’s Operating Account each month in an amount equal to the Monthly Costs multiplied by such Project Participant’s Entitlement Share. As required by Section 9.5, each Project Participant must deposit sufficient funds into such Project Participant’s Operating Account by the deadline specified in Section 9.5.
(d) Final Distribution of Operating Account. Following the expiration or earlier termination of the ESSA, and upon payment and satisfaction of any and all liabilities and obligations to make payments of the Project Participants under this Agreement and upon satisfaction of all remaining costs and obligations of CCP under the ESSA, any amounts then remaining in any Project Participant’s Operating Account shall be paid to the associated Project Participant.

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ARTICLE 9

BILLING

9.1. Monthly Costs. The amount of Monthly Costs for a particular Month shall be the sum of the Project Participant’s Entitlement Share multiplied by the Monthly Capacity Payments for the Product, as specified in Section 8.2 of the ESSA for such Month and to the extent such payment is made by CCP to the Project Developer, plus the Project Participant’s Entitlement Share multiplied by the Operating Cost for such Month and subtracting the Project Participant’s Entitlement Share multiplied by the positive revenue associated with the sale of any Facility Energy or Ancillary Services net of any CAISO costs or Scheduling Coordinator costs for such Month, as shown in the following formula:

Monthly Cost = ((Project Participant’s Entitlement Share) × (Monthly Capacity Payments)) + ((Project Participant’s Entitlement Share) × (Operating Costs)) – ((Project Participant’s Entitlement Share) × (revenue from sale of Facility Energy or Ancillary Services, net of any CAISO costs or Scheduling Coordinator costs))

9.2. Billing Statements. By no later than ten (10) calendar days after CCP receives an invoice from Project Developer for the prior Month of each Contract Year pursuant to Section 8.1 of the ESSA, CCP shall issue to each Project Participant a copy of the invoice and a “Billing Statement,” which specifies such Project Participant’s Monthly Costs, itemized by each part of such Monthly Cost. The amount of Monthly Costs attributable to a Project Participant, and specified in such Billing Statement, shall be the “Invoice Amount.”

9.3. Disputed Monthly Billing Statement. A Project Participant may dispute, by written Notice to CCP, any portion of any Billing Statement submitted to that Project Participant by CCP pursuant to Section 9.2, provided that the Project Participant shall pay the full amount of the Billing Statement when due. If CCP determines that any portion of the Billing Statement is incorrect, CCP will deposit the difference between such correct amount and such full amount, if any, including interest at the rate received by CCP on any overpayment into the Project Participant’s Operating Account. If CCP and a Project Participant disagree regarding the accuracy of a Billing Statement, CCP will give consideration to such dispute and will advise all Project Participants with regard to CCP’s position relative thereto within thirty (30) days following receipt of written Notice by Project Participant of such dispute.

9.4. Payment Adjustments; Billing Errors. If CCP or Project Developer determines that a prior invoice or Billing Statement was inaccurate, CCP shall credit against or increase as appropriate each Project Participant’s subsequent Monthly Costs according to such adjustment.

The accompanying Billing Statement shall describe the cause of such adjustment and the amount of such adjustment.

9.5. Payment of Invoice Amount. Each Project Participant shall deposit the Invoice Amount for the applicable Month into such Project Participant’s Operating Account by no later than the twentieth (20th) calendar day of the following Month after the Billing Statement is issued, unless CCP has failed to issue the Billing Statement by the deadline specified in Section 9.2, in which case, each Project Participant shall deposit the Invoice Amount for the applicable Month by no later than thirty (30) days after the date on which CCP issues the Billing Statement to the Project Participant.

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9.6. Withdrawal of Invoice Amount from Operating Account. No sooner than five (5) calendar days after CCP issues a Billing Statement to a Project Participant or a Step-Up Invoice to a Project Participant, CCP shall withdraw the Invoice Amount or the Step-Up Invoice Amount from each Project Participant’s Operating Account. If the Monthly Cost attributable to such Project Participant is a negative number, CCP shall deposit such funds into the Operating Account of that Project Participant.

9.7. Late Payments.
(a) If any Project Participant fails to deposit the Invoice Amount into the Project Participant’s Operating Account by the deadline specified in Section 9.5, then CCP will issue such Project Participant a Late Payment Notice within five (5) days of the deadline specified in Section 9.5 directing the Project Participant to immediately deposit the Invoice Amount into the Project Participant’s Operating Account and informing the Project Participant that such Project Participant must pay a charge (“Late Payment Charge”). Upon issuing a Late Payment Notice to any Project Participant, CCP shall promptly provide Notice of such occurrence to all other Project Participants.
(b) The Late Payment Charge shall be equal to the Invoice Amount minus any partial payment that was deposited into such Project Participant’s Operating Account multiplied by the Interest Rate specified in Section 8.2 of the ESSA for the period from the deadline specified in Section 9.5 until the date on which the Project Participant deposits the Invoice Amount plus the Late Payment Charge into such Project Participant’s Operating Account. Upon payment, CCP shall withdraw the full amount of such Late Payment Charge from the Project Participant’s Operating Account and deposit any such Late Payment Charge into the Operating Accounts of all other Project Participants on a pro rata share, based on such other Project Participants’ Entitlement Shares.

ARTICLE 10
UNCONDITIONAL PAYMENT OBLIGATIONS; AUTHORIZATIONS; CONFLICTS; LITIGATION.

10.1. Unconditional Payment Obligation. Beginning with the earliest of (i) the date CCP is obligated to pay any portion of the costs of the Project, (ii) the date of the COD, or (iii) the date of the first delivery of the Product to Project Participants and continuing through the term of this Agreement, Project Participants shall pay CCP the amounts of Monthly Costs set forth in the Billing Statements submitted by CCP to Project Participants in accordance with the provisions of Section 9, whether or not the Project or any part thereof has been completed, is functioning, producing, operating or operable or its output or the provision of Facility products are suspended, interrupted, interfered with, reduced or curtailed or terminated in whole or in part, and such payments shall not be subject to reduction whether by offset or otherwise and shall not be conditional upon the performance or nonperformance by any party of any agreement for any cause whatsoever, provided that the obligation of Project Participants to pay amounts associated with the Monthly Capacity Payment shall be limited to the amount of Monthly Capacity Payment charged by the Project Developer to CCP and paid by CCP to the Project Developer.

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10.2. Authorizations. Each Project Participant hereby represents and warrants that no order, approval, consent, or authorization of any governmental or public agency, authority, or person, is required on the part of such Project Participant for the execution and delivery by the Project Participant, or the performance by the Project Participant of its obligations under this Agreement except for such as have been obtained.

10.3. Conflicts. Each Project Participant represents and warrants to CCP as of the Effective Date that, to the Project Participant’s knowledge, the execution and delivery of this Agreement by the Project Participants and the Project Participants’ performance hereunder will not constitute a default under any agreement or instrument to which it is a party, or any order, judgment, decree or ruling of any court that is binding on the Project Participant, or a violation of any applicable law of any governmental authority, which default or violation would have a material adverse effect on the financial condition of the Project Participant.

10.4. Litigation. Each Project Participant represents and warrants to CCP that, as of the Effective Date, to the Project Participant’s knowledge, except as disclosed, there are no actions, suits or proceedings pending against the Project Participant (service of process on the Project Participant having been made) in any court that questions the validity of the authorization, execution or delivery by the Project Participant of this Agreement, or the enforceability on the Project Participant of this Agreement.

10.5. San José Clean Energy.
(a) The City of San José is a municipal corporation and is precluded under the California State Constitution and applicable law from entering into obligations that financially bind future governing bodies without an appropriation for such obligation, and, therefore, nothing in the Agreement shall constitute an obligation of future legislative bodies of the City of San José to appropriate funds for purposes of the Agreement; provided, however, that the City of San José has created and set aside a designated fund (being the San Jose Energy Operating Fund established pursuant to City of San Jose Municipal Code, Title 4, Part 63, Section 4.80.4050 et. seq.) (“Designated Fund”) for payment of its obligations under this Agreement. (b) Limited Obligations. The City of San José’s payment obligations under this Agreement are special limited obligations of San José Clean Energy payable solely from the Designated Fund and are not a charge upon the revenues or general fund of the City of San José or upon any non- San José Clean Energy moneys or other property of the Community Energy Department or the City of San José.

10.6. Clean Power San Francisco. With regard to Clean Power San Francisco only, (1) obligations under this Agreement are special limited obligations of Clean Power San Francisco payable solely from the revenues of Clean Power San Francisco, and shall not be a charge upon the revenues or general fund of the San Francisco Public Utilities Commission or the City and County of San Francisco or upon any non-Clean Power San Francisco moneys or other property of the San Francisco Public Utilities Commission or the City and County of San Francisco, (2) cannot exceed the amount certified by the San Francisco City Controller for the purpose and period stated in such certification, and (3) absent an authorized emergency per the San Francisco City Charter or Code, no San Francisco City representative is authorized to offer or promise, nor is San Item 5
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Francisco required to honor, any offered or promised payments under this Agreement for work beyond the agreed upon scope or in excess of the certified maximum amount without the San Francisco City Controller having first certified the additional promised amount.

ARTICLE 11
PROJECT SPECIFIC MATTERS AND PROJECT PARTICIPANTS’ RIGHTS AND OBLIGATIONS UNDER THE ESSA.

11.1. CCP Rights and Obligations under the ESSA. Notwithstanding anything to the contrary contained in this Agreement: (i) the obligation of CCP to cause the delivery of the Project Participants’ Entitlement Shares of the Product during the Delivery Term of this Agreement is limited to the Product which CCP receives from the Facility (or the Project Developer, as applicable); (ii) the obligation of CCP to pay any amount to Project Participants hereunder or to give credits against amounts due from Project Participants hereunder is limited to amounts CCP receives in connection with the transaction to which the payment or credit relates (or is otherwise available to CCP in connection with this Agreement for which such payment or credit relates); (iii) any purchase costs, operating costs, energy costs (including costs related to Charging Energy), capacity costs, Facility costs, environmental attribute costs, transmission costs, tax costs, insurance costs, indemnifications, other costs or other charges for which CCP is responsible under the ESSA shall be considered purchase costs, operating costs, energy costs, capacity costs, Facility costs, environmental attribute costs, transmission costs, tax costs, insurance costs, indemnifications, other costs or other charges incurred by CCP and payable by Project Participants as provided in this Agreement; (iv) CCP shall carry out its obligations and exercise its rights under the ESSA in a commercially reasonable manner; (v) all remedies provided to CCP pursuant to the ESSA or the Scheduling Coordinator Services Agreement shall be provided to Project Participants in accordance with Section 5.1(h); and (vi) any Force Majeure under the ESSA or other event of force majeure affecting the delivery of Product pursuant to applicable provisions of the ESSA shall be considered an event caused by Uncontrollable Forces affecting CCP with respect to the delivery of the Product hereunder and CCP forwarding to Project Participants notices and information from the Project Developer concerning an event of Force Majeure upon receipt thereofshall be sufficient to constitute a Notice that Uncontrollable Forces have occurred pursuant to Section 5.1 of this Agreement. Any net proceeds received by CCP from the sale of the Product by the Project Developer to any third-party as a result of a Force Majeure event or failure by CCP to accept delivery of Product pursuant to the ESSA and any reimbursement received by CCP for purchase of Replacement RA shall be remitted by CCP to the Project Participants in accordance with their respective Entitlement Shares.

ARTICLE 12
NONPERFORMANCE AND PAYMENT DEFAULT.

12.1. Nonperformance by Project Participants. If a Project Participant fails to perform any covenant, agreement, or obligation under this Agreement or shall cause CCP to be in default with respect to any undertaking entered into for the Project or to be in default under the ESSA (“Defaulting Project Participant”), CCP may, in the event the performance of any such obligation remains unsatisfied after thirty (30) days’ prior written notice thereof to such Project Participant and a demand to so perform, take any action permitted by law to enforce its rights under this Agreement, including but not limited to termination of such Project Participant’s rights under Item 5
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this Agreement including any rights to its Entitlement Share of the Product, and/or bring any suit, action or proceeding at law or in equity as may be necessary or appropriate to recover damages and/or enforce any covenant, agreement or obligation against such Project Participant with regard to its failure to so perform. Any Project Participant that is not the Defaulting Project Participant (“Non-Defaulting Project Participant”) may submit Notice directly to the CCP Board, if such Non-Defaulting Project Participant determines that CCP is or may not be fully taking appropriate actions to enforce CCP’s rights under this Agreement against a Defaulting Project Participant.

The CCP Board shall consider such Notice and direct CCP to take appropriate action, if any.

12.2. Payment Default. If any Project Participant fails to deposit the Invoice Amount into the Project Participant’s Operating Account by the deadline specified in Section 9.5, and if such Participant has not deposited the Invoice Amount plus the Late Payment Charge into such Project Participant’s Operating Account within ten (10) calendar days of the issuance of the Late Payment Notice to such Project Participant by CCP, then such occurrence shall constitute a “Payment Default.”

12.3. Payment Default Notice. Upon the occurrence of a Payment Default, CCP shall issue a Notice of Payment Default to the Project Participant notifying such Project Participant that as a result of a Payment Default, it is in default under this Agreement and has assumed the status of a Defaulting Project Participant and that such Defaulting Project Participant’s Project Revenue Rights have been suspended and that such Defaulting Project Participant’s Project Rights are subject to termination and disposal in accordance with Sections 12.6 and 12.8 of this Agreement.

CCP shall provide a copy of such Notice of Default to all other Project Participants within five (5) calendar days after the issuance of the written Notice of Payment Default by CCP to the Defaulting Project Participant.

12.4. Cured Payment Default. If after a Payment Default, the Defaulting Project Participant cures such Payment Default within forty-five (45) calendar days after the issuance of the Late Payment Notice by CCP, the Defaulting Project Participant’s Project Revenue Rights shall be reinstated and its Project Rights shall not be subject to termination and disposal as provided for in Sections 12.6 and 12.8. In order to cure a Payment Default, the Defaulting Project Participant must deposit the full amount of any unpaid Invoice Amounts and any associated Late Payment Penalties into its Operating Account.

12.5. Suspension of Project Participant’s Project Revenue Rights and Treatment of Capacity Attributes.
(i) Upon the occurrence of a Payment Default, the Defaulting Project Participant’s Project Revenue Rights shall be suspended until such time as such Defaulting Project Participant cures the Payment Default pursuant to the requirements of Section 12.4. Any revenue associated with the Facility Energy or Ancillary Services associated with the Facility shall be deposited by CCP into the Step-Up Reserve Account, as specified in Section 12.7. (ii) For any Month where the funds remaining in a Defaulting Project Participant’s Operating Account are sufficient to pay the entire Invoice Amount, CCP shall withdraw the Invoice Amount from such Defaulting Project Participant’s Operating Account and shall cause the delivery of the Defaulting Project Participant’s Entitlement Share of the Capacity Item 5
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Attributes and Environmental Attributes associated with the Facility or otherwise provided for pursuant to the ESSA. For any Month where the funds remaining in a Defaulting Project Participant’s Operating Account are less than the amount necessary to pay the entire Invoice Amount, CCP shall withdraw all remaining funds from the Defaulting Project Participant’s Operating Account, and to the extent reasonably possible, in CCP’s sole discretion, CCP shall cause the delivery of a quantity of Capacity Attributes and Environmental Attributes proportionate to the portion of the Invoice Amount that the remaining funds were sufficient to pay for. For any Month where the Defaulting Project Participant’s Operating Account has no funds remaining, the Defaulting Project Participant shall have no right to any such Capacity Attributes or Environmental Attributes associated with the Facility or otherwise provided for under the ESSA.

12.6. Termination and Disposal of Project Participant’s Project Rights. If a Defaulting Project Participant has not cured a Payment Default within forty-five (45) calendar days after the payment deadline specified in Section 9.5 by CCP (“Payment Default Termination Deadline"), then all Project Rights and Obligations pursuant to this Agreement shall be terminated and disposed in accordance with Sections 12.6 and 12.8 of this Agreement; provided, however, that the Defaulting Project Participant shall be liable for all outstanding payment obligations accrued prior to the Payment Default Termination Deadline and shall remain subject to all rights, obligations, and liabilities of this Agreement, including but not limited to any liabilities for Damage Payment or Termination Payment, as applicable, and any other damage payments or reimbursement amounts under the ESSA. CCP shall provide to the Defaulting Project Participant a separate monthly invoice of any such payment obligations of such Defaulting Project Participant.

CCP shall immediately notify the other Project Participants of such termination of the Defaulting Project Participant’s Project Rights and Obligations.

12.7. Step-Up Invoices.
(a) Upon the occurrence of a Payment Default, CCP shall, concurrently with the Late Payment Notice issued pursuant to Section 9.7(a), issue a Step-Up Invoice to each Non-Defaulting Project Participant that specifies such Non-Defaulting Project Participant’s pro rata payment obligation, calculated based on the Entitlement Share of such Non-Defaulting Project Participant, of the amount of the Payment Default for the Defaulting Project Participant (the “Step-Up Invoice Amount”); provided, however, that a Non-Defaulting Project Participant’s Step-Up Invoice Amount shall not exceed twenty-five percent (25%) of such Non-Defaulting Project Participant’s Invoice Amount for the same month for which the Payment Default occurred (the “Step-Up Invoice Amount Cap”).
(i) Each Non-Defaulting Project Participant shall deposit the Step-Up Invoice Amount into such Non-Defaulting Project Participant’s Operating Account by the later of the twentieth (20th) calendar day of the following Month or thirty (30) days after the date on which CCP issues the Step-Up Invoice to the other Project Participants. No sooner than five (5) calendar days after CCP issues the Step-Up Invoice, CCP may withdraw the amount of the Step-Up Invoice from each Project Participant’s Operating Account and deposit such funds in a separate account (“Step-Up Reserve Account”), which shall be accessible only by CCP, and which CCP may in its sole discretion draw upon in order to ensure that CCP can meet the payment obligations of the ESSA. CCP first shall withdraw all funds from a Defaulting Project Participant’s Operating Account before withdrawing funds from the Step-Up Reserve Account.

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(ii) Application of Moneys Received from a Defaulting Project Participant. If a Defaulting Project Participant cures a Payment Default on or before the Payment Default Termination Deadline, any funds remaining in the Step-Up Reserve Account shall be deposited into the Operating Accounts of the other Project Participants on a pro rata share, based on the Entitlement Share of such other Project Participant. If a Defaulting Project Participant fails to cure a Payment Default and the Defaulting Project Participant’s Project Rights and Obligations are terminated and disposed of in accordance with Section 12.8, any funds remaining in the Step-Up Reserve Account shall be deposited into the Operating Accounts of the Non-Defaulting Project Participants on a pro rata share, based on the Entitlement Share, subject to the Step-Up Invoice Amount Cap, of such other Project Participant. If any Non-Defaulting Project Participant has not deposited the full amount of its share of the Step-Up Invoice Amount into its Operating Account by the deadline specified in Section 12.7(a)(i), then such occurrence shall be a Late Payment as specified in Section 9.7(a) and is subject to a Late Payment Charge pursuant to Section 9.7(b), and any such Non-Defaulting Project Participant shall not be entitled to its share of any moneys received from the Defaulting Project Participant or any funds remaining in the Step-Up Reserve Account in accordance with this Section 12.7(a)(ii) until such Non-Defaulting Project Participant has deposited the full amount of its Step-Up Invoice Amount and the Late Payment Charge into its Operating Account.

12.8. Step-Up Allocation of Project Participant’s Project Rights. In the event that a Defaulting Project Participant’s Project Rights are terminated pursuant to Section 12.6, then such Defaulting Project Participant’s Entitlement Share shall be allocated to the other Project Participants (“Step-Up Allocation”) pursuant to the process set forth in this Section 12.8. If a Project Participant has defaulted in the performance of any of its obligations under its BLPTA, and any applicable cure periods under the BLPTA have expired, the Project Participants shall, to the extent required by each respective Project Participant’s BLPTA, utilize the procedures set forth in this Section 12.8 to allocate the Project Rights and Obligations of the Project Participant that has defaulted under the BLPTA to the Project Participants that have not defaulted under the BLPTA, subject to the Step-Up Allocation Cap specified in Section 12.8(a). (a) Step-Up Allocation Cap. If a Defaulting Project Participant’s Entitlement Share is allocated to the Non-Defaulting Project Participants pursuant to this Section 12.8, no individual Non-Defaulting Project Participant shall be obligated to assume an allocation that exceeds that Project Participant’s Step-Up Allocation Cap set forth in Column E of the Table in Exhibit B of this Agreement. Each Non-Defaulting Project Participant’s initial Step-Up Allocation Cap shall be equal to the Non-Defaulting Project Participant Entitlement Share as of the Effective Date and set forth in Column B of the Table in Exhibit B of this Agreement, multiplied by one hundred and twenty-five percent (125%). If a Project Participant modifies its Entitlement Share pursuant to Section 4.2 of this Agreement, then that Project Participant’s Step-Up Allocation Cap shall be equal to the Project Participant’s Entitlement Share as modified pursuant to Section 4.2 multiplied by one hundred and twenty-five percent (125%). Upon a modification of a Project Participant’s Entitlement Share pursuant to Section 4.2, the CCP Manager shall cause the Step-Up Allocation Cap specified in Column E of the Table in Exhibit B of this Agreement to be modified in accordance with this Section 12.8(a). For avoidance of doubt, if a Project Participant’s Entitlement Share is increased pursuant to Section 12.8(b) or (c), then such Project Participant’s Step-Up Allocation Cap shall not be modified.

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(b) Step-Up Allocation Share. If a Defaulting Project Participant’s Project Rights are terminated pursuant to Section 12.6, then such Defaulting Project Participant’s Entitlement Share shall be allocated to each Non-Defaulting Project Participant based on such Non-Defaulting Project Participant’s pro rata share, calculated based on its Entitlement Share of the entire project minus the Entitlement Share of the Defaulting Project Participant, unless such allocation would cause any individual Non-Defaulting Project Participant to exceed its Step-Up Allocation Cap, in which case Section 12.8(c) shall apply. Upon allocation of a defaulting Project Participant’s Entitlement Share pursuant to this Section 12.8(b), the CCP Manager shall cause each affected Project Participant’s Entitlement Share specified in Column D of the Table in Exhibit B to be modified in accordance with this Section 12.8.
(c) Voluntary Allocation of Project Rights in Excess of the Step-Up Allocation Caps. If the allocation of a Defaulting Project Participant’s Entitlement Share pursuant to Section

12.8(b) would cause any Non-Defaulting Project Participant’s Entitlement Share to exceed its Step-Up Allocation Cap, then no allocation shall occur pursuant to Section 12.8(b). In such case, the CCP Manager shall oversee the offering of the total amount of the Defaulting Project Participant’s Entitlement Share to the Non-Defaulting Project Participants on a voluntary basis.

The initial offering shall be to each Non-Defaulting Project Participant on a pro rata share, based on such Non-Defaulting Project Participant’s Entitlement Share. Each Project Participant may accept or reject the portion of the Defaulting Project Participant’s Entitlement Share. If any portion of the Defaulting Project Participant’s Entitlement Share remains unclaimed after the initial offering, then the remaining portion shall be offered to any Non-Defaulting Project Participant that accepted its full share of the Defaulting Project Participant’s Entitlement Share in the initial offering on a pro rata share, based on such Non-Defaulting Project Participant’s Entitlement Share as a percentage of the total Entitlement Shares of all Project Participants that are participating in the subsequent round of offerings. The CCP Manager shall conduct subsequent offering rounds until either the total amount of the Defaulting Project Participant’s Entitlement Share is accepted by one or more of the Non-Defaulting Project Participants or some portion of the Defaulting Project Participant’s Entitlement Share remains, but all Non-Defaulting Project Participants have rejected such remaining amount.
(d) Step-Up Allocation Damage Payment. A Defaulting Project Participant shall owe to each Non-Defaulting Project Participant that assumes any portion of the Defaulting Project Participant’s Entitlement Share pursuant to the process set forth in Section 12.8(b) or

12.8(c) a “Step-Up Allocation Damage Payment” equal to the Costs and Losses, on the one hand, netted against its Gains, on the other. If the Non-Defaulting Project Participant’s Costs and Losses exceed its Gains, then the Step-Up Allocation Damage Payment shall be an amount owing to such Non-Defaulting Project Participant. If the Non-Defaulting Project Participant’s Gains exceed its Costs and Losses, then the Step-Up Allocation Damage Payment shall be zero dollars ($0). A Defaulting Project Participant shall not be entitled to any Step-Up Allocation Damage Payment or any other damages otherwise authorized under this Agreement from any other Project Participant.

The Step-Up Allocation Damage Payment does not include consequential, incidental, punitive, exemplary, or indirect or business interruption damages. Each Non-Defaulting Project Participant that assumes any portion of the Defaulting Project Participant’s Entitlement Share pursuant to the process set forth in Section 12.8(b) or 12.8(c) shall calculate, in a commercially reasonable manner, the Step-Up Allocation Damage Payment for the Defaulting Project Participant’s Entitlement Share assumed by the Non-Defaulting Project Participant as of the effective date of such Step-Up Item 5
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Allocation. 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. If the Defaulting Project Participant disputes the Non-Defaulting Project Participant’s calculation of the Step-Up Allocation Damage Payment, in whole or in part, the Defaulting Project Participant shall, within five (5) Business Days of receipt of the Non-Defaulting Project Participant’s calculation of the Step-Up Allocation Damage Payment, provide to the Non-Defaulting Project Participant a detailed written explanation of the basis for such dispute. Disputes regarding the Step-Up Allocation Damage Payment shall be determined in accordance with Article 16. Each Party agrees and acknowledges that (i) the actual damages that the other Project Participant would incur in connection with a Step-Up Allocation would be difficult or impossible to predict with certainty, (ii) the Step-Up Allocation Damage Payment described in this Section 12.8(d) is a reasonable and appropriate approximation of such damages, and (iii) the Step-Up Allocation Damage Payment described in this Section

12.8(d) is the exclusive remedy of a Project Participant in connection with a Step-Up Allocation pursuant to the process set forth in Sections 12.8(b) or 12.8(c) against a Defaulting Project Participant but shall not otherwise act to limit any of the Non-Defaulting Project Participant’s rights or remedies under this Agreement.
(e) Remarketing of Unclaimed Defaulting Project Participant’s Entitlement Share. If after the process set forth in Section 12.8(c), some portion of the Defaulting Project Participant’s Entitlement Share remains unclaimed, the CCP Manager, in their discretion or as directed by the Non-Defaulting Project Participants, may take any action to generate revenue from such unclaimed Entitlement Share in order to meet CCP’s payment obligation under the ESSA.

For avoidance of doubt, the CCP Manager shall not be limited by the requirements of Section 4.2 or 5.1(j) of this Agreement in remarketing or generating revenue base on the unclaimed share.

12.9. Elimination or Reduction of Payment Obligations. Notwithstanding anything to the contrary in this Agreement, upon termination of a Defaulting Project Participant’s Project Rights pursuant to Section 12.6 and the disposal of such Defaulting Project Participant’s Project Rights and Obligations pursuant to Section 12.8, such Defaulting Project Participant’s obligation to make payments under this Agreement (notwithstanding anything to the contrary herein) shall not be eliminated or reduced; provided, however, such payment obligations for the Defaulting Project Participant may be eliminated or reduced to the extent permitted by law, through an amendment to this Agreement, which shall be subject to the consent and approval of all Parties to this Agreement.

ARTICLE 13

LIABILITY

13.1. Project Participants’ Obligations Several. No Project Participant shall be liable under this Agreement for the obligations of any other Project Participant or for the obligations of CCP incurred on behalf of other Project Participants. Each Project Participant shall be solely responsible and liable for performance of its obligations under this Agreement, except as otherwise provided for herein. The obligation of Project Participants to make payments under this Agreement is a several obligation and not a joint obligation with those of the other Project Participants.

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13.2. No Liability of CCP or Project Participants, Their Directors, Officers, Etc.; CCP, The Project Participants’ and CCP Manager’s Directors, Officers, Employees Not Individually Liable. Except as provided for under Section 13.5 herein, the Parties agree that neither CCP, Project Participants, nor any of their past, present or future directors, officers, employees, board members, agents, attorneys or advisors (collectively, the “Released Parties”) shall be liable to any other of the Released Parties for any and all claims, demands, liabilities, obligations, losses, damages (whether direct, indirect or consequential), penalties, actions, loss of profits, judgments, orders, suits, costs, expenses (including attorneys’ fees and expenses) or disbursements of any kind or nature whatsoever in law, equity or otherwise (including, without limitation, death, bodily injury or personal injury to any person or damage or destruction to any property of Project Participants, CCP, or third persons) suffered by any Released Party as a result of the action or inaction or performance or non-performance by the Project Developer under the ESSA. Except as provided for under Section 13.5 herein, each Party shall release each of the other Released Parties from any claim or liability that such Party may have cause to assert as a result of any actions or inactions or performance or non-performance by any of the other Released Parties under this Agreement (excluding gross negligence and willful misconduct, which, unless otherwise agreed to by the Parties, are both to be determined and established by a court of competent jurisdiction in a final, non-appealable order). Notwithstanding the foregoing, no such action or inaction or performance or non-performance by any of the Released Parties shall relieve CCP or any Project Participants from their respective obligations under this Agreement, including, without limitation, the Project Participants’ obligation to make payments required under Section 9.5 of this Agreement and CCP’s obligation to make payments under Section 8.2 of the ESSA. The provisions of this Section 13.2 shall not be construed so as to relieve the CCP or the Project Developer from any obligation or liability under this Agreement or the ESSA.

13.3. Extent of Exculpation; Enforcement of Rights. The exculpation provision set forth in Section 13.2 hereof shall apply to all types of claims or actions including, but not limited to, claims or actions based on contract or tort. Notwithstanding the foregoing, any Party may protect and enforce its rights under this Agreement by a suit or suits in equity for specific performance of any obligations or duty of any other Party, and each Party shall at all times retain the right to recover, by appropriate legal proceedings, any amount determined to have been an overpayment, underpayment or other monetary damages owed by the other Party in accordance with the terms of this Agreement.

13.4. No General Liability of CCP. The undertakings under this Agreement by CCP shall not constitute a debt or indebtedness of CCP within the meaning of any provision or limitation of the Constitution or statutes of the State of California, and shall not constitute or give rise to a charge against its general credit.

13.5. Indemnification. Each Party shall indemnify, defend, protect, hold harmless, and release the other Parties, their directors, board members, officers, employees, agents, attorneys and advisors, past, present or future, from and against any and all claims, demands, liabilities, obligations, losses, damages (whether direct, indirect or consequential), penalties, actions, loss of profits, judgments, orders, suits, costs, expenses (including attorneys’ fees and expenses) or disbursements of any kind or nature whatsoever in law, equity or otherwise, which include, without limitation, death, bodily injury, or personal injury to any person or damage or destruction to any property of Project Participants, CCP, or third persons, that may be imposed on, incurred by or Item 5
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asserted against any Party arising by manner of any breach of this Agreement, or the negligent acts, errors, omissions or willful misconduct incident to the performance of this Agreement on the part of any Party or any Party’s directors, board members, officers, employees, agents and advisors, past, present or future.

ARTICLE 14

NOTICES

14.1. 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 A or at such other address or addresses as a Party may designate for itself from time to time by Notice hereunder.

14.2. 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, five (5) Business Days following the date of the postmark on the envelope in which such Notice was deposited in the United States mail; (b) if sent by a regularly scheduled overnight delivery carrier with delivery fees either prepaid or an arrangement with such carrier made for the payment of such fees, the next Business Day after the same is delivered by the sending Party to such carrier; (c) if sent by electronic communication (including electronic mail or other electronic means) at the time indicated by the time stamp upon delivery and, if after 5:00 pm, on the next Business Day; or (d) if delivered in person, upon receipt by the receiving Party. Notwithstanding the foregoing, Notices of outages or other scheduling or dispatch information or requests, may be sent by electronic communication and shall be considered delivered upon successful completion of such transmission.

ARTICLE 15

ASSIGNMENT

15.1. General Prohibition on Assignments. No Party may assign this Agreement, or its rights or obligations under this Agreement, without the prior written consent of all other Parties, in each Party’s sole discretion.

ARTICLE 16

GOVERNING LAW AND 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. The Parties agree that any suit, action, or other legal proceeding by or against any Party with respect to or arising out of this Agreement shall be brought in the federal or state courts located in the State of California in a location to be mutually chosen by all Parties, or in the absence of mutual agreement, the County of San Francisco.

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16.2. Dispute Resolution. In the event of any dispute arising under this Agreement, within ten (10) days following the receipt of a Notice from either Party identifying such dispute, the Parties shall meet, negotiate, and attempt, in good faith, to resolve the dispute quickly and informally without significant legal costs. If the Parties are unable to resolve a dispute arising hereunder within thirty (30) days after Notice of the dispute, the Parties may pursue all remedies available to them at Law or in equity.

ARTICLE 17

MISCELLANEOUS

17.1. Entire Agreement; Integration; Exhibits. This Agreement, together with the Exhibits attached hereto constitutes the entire agreement and understanding by and among the Parties with respect to the subject matter hereof and supersedes all prior agreements relating to the subject matter hereof, which are of no further force or effect. The Exhibits attached hereto are integral parts hereof and are made a part of this Agreement by reference. The headings used herein are for convenience and reference purposes only. 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.

17.2. Amendments. This Agreement may only be amended, modified, or supplemented by an instrument in writing executed by duly authorized representatives of all Parties; provided, this Agreement may not be amended by electronic mail communications. Any revisions to the Entitlement Share specified in Exhibit B pursuant to Section 4.2. or Section 12.8 shall be considered an element of the administration of this Agreement and shall not require the consent of the Parties hereto.

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

17.4. 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.

17.5. 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.

17.6. Electronic Delivery. This Agreement may be duly executed and delivered by a Party by electronic format (including portable document format (.pdf)). Delivery of an executed counterpart in .pdf electronic version shall be binding as if delivered in the original. The words “execution,” “signed,” “signature,” and words of like import in this Agreement shall be deemed to include electronic signatures or electronic records, each of which shall be of the same legal effect, Item 5
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validity, or enforceability as a manually executed signature or the use of a paper-based record keeping system, as the case may be, to the extent and as provided for in any applicable law.

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

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

17.9. City of San Francisco Standard Provisions.
(a) False Claims. Pursuant to San Francisco Administrative Code § 21.35, any Party to this Agreement who submits a false claim shall be liable to the City and County of San Francisco for the statutory penalties set forth in that section. A Party will be deemed to have submitted a false claim to the City and County of San Francisco if the Party: (a) knowingly presents or causes to be presented to an officer or employee of the City and County of San Francisco a false claim or request for payment or approval; (b) knowingly makes, uses, or causes to be made or used a false record or statement to get a false claim paid or approved by the City and County of San Francisco; (c) conspires to defraud the City and County of San Francisco by getting a false claim allowed or paid by the City and County of San Francisco; (d) knowingly makes, uses, or causes to be made or used a false record or statement to conceal, avoid, or decrease an obligation to pay or transmit money or property to the City and County of San Francisco; or (e) is a beneficiary of an inadvertent submission of a false claim to the City and County of San Francisco, subsequently discovers the falsity of the claim, and fails to disclose the false claim to the City and County of San Francisco within a reasonable time after discovery of the false claim. (b) Political Activity. In performing its responsibilities under this Agreement, CCP shall comply with San Francisco Administrative Code Chapter 12G, which prohibits funds appropriated by the City and County of San Francisco for this Agreement from being expended to participate in, support, or attempt to influence any political campaign for a candidate or for a ballot measure.
(c) Non-discrimination Requirements.
(i) Non-discrimination in Contracts. CCP shall comply with the provisions of Chapters 12B and 12C of the San Francisco Administrative Code. CCP shall incorporate by reference in all subcontracts the provisions of Sections12B.2(a), 12B.2(c)-(k), and 12C.3 of the San Francisco Administrative Code and shall require all subcontractors to comply with such provisions. CCP is subject to the enforcement and penalty provisions in Chapters 12B and 12C.

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(ii) Non-discrimination in the Provision of Employee Benefits. San Francisco Administrative Code 12B.2. CCP does not as of the date of this Agreement, and will not during the term of this Agreement, in any of its operations in San Francisco, on real property owned by San Francisco, or where work is being performed for the City elsewhere in the United States, discriminate in the provision of employee benefits between employees with domestic partners and employees with spouses and/or between the domestic partners and spouses of such employees, subject to the conditions set forth in San Francisco Administrative Code Section 12B.2. (d) Consideration of Criminal History in Hiring and Employment Decisions.

CCP agrees to comply fully with and be bound by all of the provisions of Chapter 12T, “City Contractor/Subcontractor Consideration of Criminal History in Hiring and Employment Decisions,” of the San Francisco Administrative Code, including the remedies provided, and implementing regulations, as may be amended from time to time. The requirements of Chapter 12T shall only apply to CCP’s operations to the extent those operations are in furtherance of the performance of this Agreement, shall apply only to applicants and employees who would be or are performing work in furtherance of this Agreement, and shall apply when the physical location of the employment or prospective employment of an individual is wholly or substantially within the City. Chapter 12T shall not apply when the application in a particular context would conflict with federal or state law or with a requirement of a government agency implementing federal or state law. MacBride Principles – Northern Ireland. Pursuant to San Francisco Administrative Code § 12F.5, the City and County of San Francisco urges companies doing business in Northern Ireland to move towards resolving employment inequities, and encourages such companies to abide by the MacBride Principles. The City and County of San Francisco urges San Francisco companies to do business with corporations that abide by the MacBride principles. (e) MacBride Principles – Northern Ireland. Pursuant to San Francisco Administrative Code § 12F.5, the City and County of San Francisco urges companies doing business in Northern Ireland to move towards resolving employment inequities, and encourages such companies to abide by the MacBride Principles. The City and County of San Francisco urges San Francisco companies to do business with corporations that abide by the MacBride Principles. (f) Tropical Hardwood and Virgin Redwood Ban. The City and County of San Francisco urges contractors not to import, purchase, obtain, or use for any purpose, any tropical hardwood, tropical hardwood product, virgin redwood or virgin redwood product. If this order is for wood products or a service involving wood products: (a) Chapter 8 of the Environment Code is incorporated herein and by reference made a part hereof as though fully set forth. (b) Except as expressly permitted by the application of Sections 802(B), 803(B), and 804(B) of the Environment Code, CCP shall not provide any items to the City in performance of this Agreement which are tropical hardwoods, tropical hardwood products, virgin redwood or virgin redwood products. (c) Failure of CCP to comply with any of the requirements of Chapter 8 of the Environment Code shall be deemed a material breach of contract.

17.10. City of San José Standard Provisions.
(a) Nondiscrimination/Non-Preference. The Parties shall not, and shall not cause or allow its subcontractors to, discriminate against or grant preferential treatment to any person on the basis of race, sex, color, age, religion, sexual orientation, actual or perceived gender Item 5
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identity, disability, ethnicity or national origin. This prohibition applies to recruiting, hiring, demotion, layoff, termination, compensation, fringe benefits, advancement, training, apprenticeship and other terms, conditions, or privileges of employment, subcontracting and purchasing. The Parties will inform all subcontractors of these obligations. This prohibition is subject to the following conditions: (i) the prohibition is not intended to preclude Parties from providing a reasonable accommodation to a person with a disability; (ii) the City of San José’s Compliance Officer may require the Parties to file, and cause any Party’s subcontractor to file, reports demonstrating compliance with this section. Any such reports shall be filed in the form and at such times as the City’s Compliance Officer designates. They shall contain such information, data and/or records as the City’s Compliance Officer determines is needed to show compliance with this provision.
(b) Conflict of Interest. The Parties represent that they are familiar with the local and state conflict of interest laws, and agrees to comply with those laws in performing this Agreement. The Parties certify that, as of the Effective Date, are unaware of any facts constituting a conflict of interest or creating an appearance of a conflict of interest. The Parties shall avoid all conflicts of interest or appearances of conflicts of interest in performing this Agreement. The Parties have the obligation of determining if the manner in which it performs any part of this Agreement results in a conflict of interest or an appearance of a conflict of interest, and a Party shall immediately notify the City of San José in writing if it becomes aware of any facts giving rise to a conflict of interest or the appearance of a conflict of interest. A Party’s violation of this Section 17.10(b) is a material breach.
(c) Environmentally Preferable Procurement Policy. Parties shall perform its obligations under this Agreement in conformance with San José City Council Policy 1-19, entitled “Prohibition of City Funding for Purchase of Single serving Bottled Water,” and San José City Council Policy 4-6, entitled “Environmentally Preferable Procurement Policy,” as those policies may be amended from time to time. The Parties acknowledge and agree that in no event shall a breach of this Section 17.10(c) be a material breach of this Agreement or otherwise give rise to an Event of Default or entitle the City of San José to terminate this Agreement. (d) Gifts Prohibited. The Parties represent that they are familiar with Chapter

12.08 of the San José Municipal Code, which generally prohibits a City of San José officer or designated employee from accepting any gift. The Parties shall not offer any City of San José officer or designated employee any gift prohibited by Chapter 12.08. A Party’s violation of this Section 17.10(d) is a material breach.
(e) Disqualification of Former Employees. The Parties represent that they are familiar with Chapter 12.10 of the San José Municipal Code, which generally prohibits a former City of San José officer and former designated employee from providing services to the City of San José connected with his/her former duties or official responsibilities. Parties shall not use either directly or indirectly any officer, employee or agent to perform any services if doing so would violate Chapter 12.10.

17.11. Further Assurances. Each of the Parties hereto agrees to provide such information, execute, and deliver any instruments and documents and to take such other actions as may be necessary or reasonably requested by the other Party which are not inconsistent with the provisions Item 5
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of this Agreement and which do not involve the assumptions of obligations other than those provided for in this Agreement, to give full effect to this Agreement and to carry out the intent of this Agreement.
[Signatures on following page]
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IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed as of the Effective Date.

California Community Power
By:

Name:

Title:

Approved as to form by Counsel
By:

Name:

Title:

Clean Power San Francisco
By:

Name:

Title:

Approved as to form by Counsel
By:

Name:

Title:

Peninsula Clean Energy
By:

Name:

Title:

Approved as to form by Counsel
By:

Name:

Title:

Redwood Coast Energy Authority
By:

Name:

Title:

Approved as to form by Counsel
By:

Name:

Title:

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San José Clean Energy
By:

Name:

Title:

Approved as to form by Counsel
By:

Name:

Title:

Silicon Valley Clean Energy
By:

Name:

Title:

Approved as to form by Counsel
By:

Name:

Title:

Sonoma Clean Power
By:

Name:

Title:

Approved as to form by Counsel
By:

Name:

Title:

Valley Clean Energy
By:

Name:

Title:

Approved as to form by Counsel
By:

Name:

Title:

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EXHIBIT A

NOTICES
Party All Notices Invoices
California
Community Power
California Community Power
Tim Haines
____________________
____________________
timhaines@powergridsymmetry
.com
Clean Power San
Francisco
Clean Power San Francisco
Barbara Hale, Assistant General
Manager, Power
San Francisco Public Utilities
Commission
525 Golden Gate Ave, 13th
Floor
San Francisco, CA 94102
[email protected]
Peninsula Clean
Energy
Peninsula Clean Energy
Jan Pepper, CEO
Peninsula Clean Energy
2075 Woodside Road
Redwood City, California 94061
jpepper@peninsulacleanenergy.
com
Redwood Coast
Energy Authority
Redwood Coast Energy
Authority
Matthew Marshall, CEO
Redwood Coast Energy
Authority
633 3rd Street
Eureka, CA 95501
[email protected]
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Party All Notices Invoices
San José Clean
Energy
San José Clean Energy
Lori Mitchell, Director
cc: Luisa Elkins, Senior Deputy
City Attorney
San José Clean Energy
200 E. Santa Clara Street, 14th
Floor
San José, CA 95113
[email protected]
[email protected]
Silicon Valley Clean
Energy
Silicon Valley Clean Energy
Girish Balachandran, CEO
Silicon Valley Clean Energy
Authority
333 W. El Camino Real, Suite
330
Sunnyvale, CA 94087
[email protected]
Sonoma Clean
Power
Sonoma Clean Power
Geof Syphers, CEO
Sonoma Clean Power
50 Santa Rosa Avenue, 5th Floor
Santa Rosa, CA 95404
[email protected]
rg
Valley Clean
Energy
Valley Clean Energy
Gordon Samuel
Assistant General Manager &
Director of Power Resource
604 2nd Street
Davis, CA 95616
gordon.samuel@valleycleanene
rgy.org
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EXHIBIT B

SCHEDULE OF PROJECT PARTICIPANT ENTITLEMENT SHARES

AND STEP-UP ALLOCATION CAPS
Dated:________________________

A B C D E
Project Participant
Entitlement Share
As of Effective Date
Entitlement Share
As Modified Pursuant to
Section 4.2
Entitlement Share
As Modified Pursuant to
Section 12.8(b) or 12.8(c)
Step-Up Allocation Cap
125% multiplied by Column B
or C as applicable
Clean Power San Francisco 16.06%
Peninsula Clean Energy 19.69%
Redwood Coast Energy Authority 3.62%
San José Clean Energy 22.28%
Silicon Valley Clean Energy 21.25%
Sonoma Clean Power 12.95%
Valley Clean Energy 4.15%
Total 100%
Instructions: If the CCP Manager modifies one or more Project Participant’s Entitlement Share pursuant to Section 4.2, the CCP Manager shall prepare an updated Exhibit B that shows the prior Entitlement Share (Column B or D) in strikeout and specifies the new Entitlement Share values and the effective date of such modification in Column C. If the CCP Manager modifies one or more Project Participant’s Entitlement Share pursuant to Section 12.8, the CCP Manager shall prepare an updated Exhibit B that shows the prior Entitlement Share (Column B or Column C) in strikeout and specifies the new Entitlement Share values and the effective date of such modification in Column D.

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EXHIBIT C

PROCEDURE FOR VOLUNTARY REDUCTION OF
PROJECT PARTICIPANT’S ENTITLEMENT SHARE
(a) Offer to Other Project Participants. A Project Participant proposing to reduce its Entitlement Share of the Project shall provide Notice to all other Project Participants and CCP specifying the quantity of the proposed reduction of Entitlement Share (“Entitlement Share Reduction Amount”) and the first Month for which the Project Participant Proposes that the change of Entitlement Share would become effective (such Notice referred to as the “Entitlement Share Reduction Notice”).
(i) Upon receiving an Entitlement Share Reduction Notice from any Project Participant, the CCP Manager shall promptly do all of the following:
(A) Establish Entitlement Share Reduction Compensation
Amount. The CCP Manager shall secure at least one (1), but no more than three (3), valuations of the net present value of the Entitlement Share Reduction Amount over the remaining term of the ESSA from one or more qualified firm(s) with the requisite experience to determine such valuation. The valuation, or if more than one valuation is obtained, the average of all valuations received, shall be the “Proposed Entitlement Share Reduction Compensation Amount.” The CCP Manager shall call a meeting of the Project Committee and present the Proposed Entitlement Share Reduction Compensation Amount to the Project Committee. The Project Committee shall by a Normal Vote either approve the Proposed Entitlement Share Reduction Compensation Amount or direct the CCP Manager to secure additional valuations. The Proposed Entitlement Share Reduction Compensation Amount approved by the Project Committee shall be the “Entitlement Share Reduction Compensation Amount.” The Project Participant proposing to reduce its Entitlement Share may modify the quantity of the Entitlement Share Reduction Amount associated with its proposal or withdraw its proposal at any time prior to the initiation of the process set forth in paragraph (a)(i)(B).
(B) Oversee the Offering of the Entitlement Share Reduction Amount to Other Project Participants. The CCP Manager shall facilitate the offering of the Entitlement Share Reduction Amount to the other Project Participants through multiple rounds of offerings.
a) The initial offering shall be to each Project
Participant on a pro rata share, based on such Project Participant’s Entitlement Share. Each Project Participant may accept or reject the portion of the Entitlement Share Reduction Amount offered to the Project Participant through this process. If any portion of the Entitlement Share Reduction Amount remains after the initial offering, then the remaining portion shall be offered to any Project Participant that accepted the share of the Entitlement Share Reduction Amount offered in the initial offering on a pro rata share, based on such Project Participant’s Entitlement Share as a percentage of the total Entitlement Shares of all Project Participants that accepted the portion of the Entitlement Share Reduction Amount offered to them in the initial offering.

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b) The CCP Manager shall conduct subsequent offering
rounds until either the total Entitlement Share Reduction Amount is accepted by one or more of the other Project Participants or some portion of the Entitlement Share Reduction Amount remains, but all Project Participants have rejected such amount. c) Any Project Participant accepting a share of the
offered Entitlement Share Reduction Amount shall either pay the offering Project Participant or be compensated by the offering Project Participant at the Entitlement Share Reduction Compensation Amount multiplied by the quantity of the portion being accepted. d) Before a transfer of all or a portion of any Project Participant’s Entitlement share to another Project Participant can become effective, the proposed transfer must be submitted to and approved by the Project Committee through a Normal Vote. e) After acceptance and payment for such portion of the Entitlement Share Reduction Amount, and upon approval of such transfer by the Project Committee, the CCP Manager shall cause the Entitlement Share specified in Exhibit B to be modified accordingly, and such modification shall be considered an element of the administration of this Agreement and shall not require the consent of the Parties hereto. (C) Oversee the Offering of the Entitlement Share Reduction Amount to CCP Members that are not Project Participants. If there is any portion of the Entitlement Share Reduction Amount that remains unaccepted after the process specified in paragraph (a)(i)(B) is complete, then the Project Participant proposing to reduce its Entitlement Share may request that the CCP Manager offer the remaining portion of the Entitlement Share Reduction Amount to CCP Members that are not Project Participants. If any CCP Member wishes to accept any or all of the remaining portion of the Entitlement Share Reduction Amount, such action shall require the CCP Member to become a Project Participant through an amendment to this Agreement, which shall be subject to the consent and approval of all Parties to this Agreement and the CCP Member becoming a Project Participant. The compensation amount associated with the CCP Member accepting the remaining portion of the Entitlement Share Reduction Amount shall be negotiated between the CCP Member and the offering Project Participant. (D) Oversee the Offering of the Entitlement Share Reduction Amount to a Community Choice Aggregator that is not a CCP Member. If there is any portion of the Entitlement Share Reduction Amount that remains unaccepted after the process specified in both paragraphs (a)(i)(B) and (a)(k)(C) is complete, then the Project Participant proposing to reduce its Entitlement Share, may request that the CCP Manager offer the remaining portion of the Entitlement Share Reduction Amount to a community choice aggregator that is not a CCP Member. If any community choice aggregator wishes to accept any or all of the remaining portion of the Entitlement Share Reduction Amount, such action shall require the community choice aggregator to become a CCP Member, and subsequent to becoming a CCP Member, to become a Project Participant through an amendment to this Agreement that is subject to the consent and approval of all Parties to this Agreement and the community choice aggregator becoming a Project Participant. The compensation amount associated with the community choice aggregator accepting the remaining portion of the Entitlement Share Reduction Amount shall be negotiated between the community choice aggregator and the offering Project Participant.

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EXHIBIT D

PROJECT COMMITTEE OPERATIONS, MEETINGS, AND VOTING
(a) Chairperson of Project Committee. The chairperson of the Project Committee (“Chairperson”) shall be the CCP Manager. The Chairperson shall be responsible for calling and presiding over meetings of the Project Committee in a manner and to the extent permitted by law.
(b) Conducting Meetings. Conducting of Project Committee meetings and actions taken by the Project Committee may be taken by vote given in an assembled meeting, by telephone, by video conferencing, or by any combination thereof, to the extent permitted by law. (c) Calling of Meetings.
(i) The Chairperson may call a meeting of the Project Committee at their discretion.
(ii) The Chairperson shall promptly call a meeting of the Project Committee at the request of any representative of a Project Participant. (d) Unanimous Votes. Certain actions, as designated in Section 6.4(c), require a unanimous affirmative vote by all Project Participants (“Unanimous Vote”). No such vote may be taken unless a representative from every Project Participant is present at the meeting of the Project Committee. If any Project Participant’s Entitlement Share is reduced to zero through the process specified in Exhibit C, such Project Participant shall not be required to be present or be entitled to vote in order for such vote to be a Unanimous Vote. (e) Normal Votes. All actions not designated as requiring unanimous vote, shall proceed pursuant to the “Normal Vote” process set forth in this paragraph (e). (i) Quorum. No Normal Vote of the Project Committee shall be taken unless a representative is present for at least fifty percent (50%) of the total number of Project Participants, without regard to each Project Participant’s Entitlement Share. (ii) Initial Normal Vote. Unless a representative requests an Alternate Normal Vote, pursuant to paragraph (e)(iii), all actions requiring a Normal Vote, as specified in Section 6.4(b) or 6.4(d), shall require an affirmative vote of at least fifty-one percent (51%) of the total number of Project Participants, without regard to each Project Participant’s Entitlement Share.
(iii) Alternate Normal Vote. Any representative may request that any Normal Vote be taken on an Entitlement Share basis (referred to as an “Alternate Normal Vote”).

If a representative requests an Alternate Normal Vote, then the following vote requirements shall apply:

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(A) If any individual Project Participant has an Entitlement Share exceeding fifty percent (50%), then all actions for which an Alternate Normal Vote is taken shall require that the Project Participant with an Entitlement Share exceeding fifty percent (50%) plus any other Project Participant vote in the affirmative. (B) If no individual Project Participant has an Entitlement Share exceeding fifty percent (50%), then all actions for which an Alternate Normal Vote is taken shall require an affirmative vote of Project Participants having Entitlement Shares aggregating at least fifty-one percent (51%) of the total Entitlement Shares.

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Execution Version

ENERGY STORAGE SERVICE AGREEMENT

COVER SHEET
Seller: Tumbleweed Energy Storage, LLC, a Delaware limited liability company Buyer: California Community Power, a California joint powers authority Description of Facility: 69 MW/552 MWh grid-connected battery energy storage facility (CAISO Queue 1217) located near Rosamond, Kern County, California, as further described in Exhibit A.

Milestones:

Milestone Expected Date for
Completion
Evidence of Site Control 8/12/2019
Conditional Use Permit obtained
Phase I and Phase II Interconnection study results
obtained 6/1/2018
Interconnection Agreement executed 11/12/2018
Major equipment procured
Federal and state discretionary permits issued
Expected Construction Start Date
Guaranteed Construction Start Date 12/31/2025
Initial Synchronization 4/1/2026
Network Upgrades completed 12/31/2025
Partial Capacity Deliverability Status sufficient to fully deliver the Facility’s Guaranteed Capacity is obtained 3/16/2018 Expected Commercial Operation Date 4/15/2026
Guaranteed Commercial Operation Date 6/1/2026
Delivery Term: 15 Contract Years
Guaranteed Capacity: 69 MW of Installed Capacity at eight (8) hours of continuous discharge Dedicated Interconnection Capacity: 69 MW
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Guaranteed Efficiency Rate:

Contract Year Guaranteed Efficiency Rate
1-15 83.3%
Contract Price:

Contract Year Contract Price
1 – 15 $ /kW-mo. (flat) with no escalation
and subject to adjustments in Exhibit C
Product:
☒ Discharging Energy
☒ Installed Capacity and Effective Capacity
☒ Ancillary Services
☒ Capacity Attributes
Scheduling Coordinator:

Prior to Commercial Operation Date: Seller
From Commercial Operation Date through the Delivery Term: Buyer Security Amount:

Development Security: $ /kW of Guaranteed Capacity
Performance Security: $ /kW of Guaranteed Capacity
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TABLE OF CONTENTS
Page
i

TABLE OF CONTENTS
ARTICLE 1 DEFINITIONS .......................................................................................................... 1

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

1.2 Rules of Interpretation ......................................................................................... 21 ARTICLE 2 TERM; CONDITIONS PRECEDENT ................................................................... 22

2.1 Contract Term. ..................................................................................................... 22

2.2 Commercial Operation; Conditions Precedent .................................................... 23

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

2.4 Remedial Action Plan .......................................................................................... 24

2.5 Pre-Commercial Operation Actions ..................................................................... 25 ARTICLE 3 PURCHASE AND SALE ....................................................................................... 25

3.1 Product ................................................................................................................. 25

3.2 Discharging Energy ............................................................................................. 25

3.3 Capacity Attributes .............................................................................................. 25

3.4 Ancillary Services; Environmental Attributes. .................................................... 26

3.5 Resource Adequacy Failure. ................................................................................ 26

3.6 Buyer’s Re-Sale of Product ................................................................................. 27 ARTICLE 4 OBLIGATIONS AND DELIVERIES .................................................................... 27

4.1 Delivery ................................................................................................................ 27

4.2 Interconnection .................................................................................................... 28

4.3 Performance Guarantees ...................................................................................... 28

4.4 Facility Testing .................................................................................................... 28

4.5 Testing Costs and Revenues ................................................................................ 29

4.6 Facility Operations ............................................................................................... 30

4.7 Dispatch Notices .................................................................................................. 30

4.8 Facility Unavailability to Receive Dispatch Notices ........................................... 30

4.9 Energy Management. ........................................................................................... 31

4.10 Capacity Availability Notice. ............................................................................... 33

4.11 [Reserved]. ........................................................................................................... 33

4.12 Outages ................................................................................................................ 33 ARTICLE 5 TAXES, GOVERNMENTAL AND ENVIRONMENTAL COSTS ...................... 34

5.1 Allocation of Taxes and Charges ......................................................................... 34

5.2 Cooperation .......................................................................................................... 35

5.3 Environmental Costs ............................................................................................ 35 ARTICLE 6 MAINTENANCE AND REPAIR OF THE FACILITY ........................................ 35

6.1 Maintenance of the Facility. ................................................................................ 35

6.2 Maintenance of Health and Safety. ...................................................................... 36

6.3 Shared Facilities. .................................................................................................. 36 ARTICLE 7 METERING ............................................................................................................ 36 Item 5
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7.1 Metering. .............................................................................................................. 36

7.2 Meter Verification. ............................................................................................... 37 ARTICLE 8 INVOICING AND PAYMENT; CREDIT ............................................................. 37

8.1 Invoicing .............................................................................................................. 37

8.2 Payment ................................................................................................................ 37

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

8.4 Payment Adjustments; Billing Errors .................................................................. 38

8.5 Billing Disputes ................................................................................................... 38

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

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

8.8 Seller’s Performance Security .............................................................................. 39

8.9 First Priority Security Interest in Cash or Cash Equivalent Collateral ................ 39

8.10 Buyer Credit Arrangements ................................................................................. 40 ARTICLE 9 NOTICES ................................................................................................................ 41

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

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

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

10.2 No Liability If a Force Majeure Event Occurs .................................................... 43

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

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

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

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

11.3 Damage Payment; Termination Payment ............................................................ 47

11.4 Notice of Payment of Termination Payment or Damage Payment ...................... 48

11.5 Disputes With Respect to Termination Payment or Damage Payment ............... 48

11.6 Limitation on Seller’s Ability to Make or Agree to Third-Party Sales from the Facility after Early Termination Date ............................................................ 48

11.7 Rights And Remedies Are Cumulative ................................................................ 49

11.8 Mitigation ............................................................................................................. 49

11.9 Pass Through of Buyer Liability .......................................................................... 49 ARTICLE 12 LIMITATION OF LIABILITY AND EXCLUSION OF WARRANTIES .......... 49

12.1 No Consequential Damages ................................................................................. 49

12.2 Waiver and Exclusion of Other Damages ............................................................ 49

12.3 Limitation on Pre-COD Liability ......................................................................... 50 ARTICLE 13 REPRESENTATIONS AND WARRANTIES; COVENANTS .......................... 50

13.1 Seller’s Representations and Warranties ............................................................. 50

13.2 Buyer’s Representations and Warranties ............................................................. 51

13.3 General Covenants ............................................................................................... 52

13.4 Seller’s Covenants ............................................................................................... 52 Item 5
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ARTICLE 14 ASSIGNMENT ..................................................................................................... 53

14.1 General Prohibition on Assignments ................................................................... 53

14.2 Collateral Assignment .......................................................................................... 54

14.3 Permitted Assignment .......................................................................................... 54

14.4 Portfolio Financing .............................................................................................. 54

14.5 Buyer Financing Assignment ............................................................................... 55 ARTICLE 15 DISPUTE RESOLUTION .................................................................................... 55

15.1 Governing Law. ................................................................................................... 55

15.2 Dispute Resolution. .............................................................................................. 55

15.3 Attorneys’ Fees. ................................................................................................... 55 ARTICLE 16 INDEMNIFICATION ........................................................................................... 55

16.1 Indemnification. ................................................................................................... 55

16.2 Claims. ................................................................................................................. 56 ARTICLE 17 INSURANCE ........................................................................................................ 57

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

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

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

18.3 Irreparable Injury; Remedies ............................................................................... 59

18.4 Further Permitted Disclosure ............................................................................... 60

18.5 Press Releases ...................................................................................................... 60 ARTICLE 19 MISCELLANEOUS ............................................................................................. 60

19.1 Entire Agreement; Integration; Exhibits .............................................................. 60

19.2 Amendments ........................................................................................................ 60

19.3 No Waiver ............................................................................................................ 60

19.4 No Agency, Partnership, Joint Venture or Lease ................................................. 60

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

19.6 Mobile-Sierra ....................................................................................................... 61

19.7 Counterparts ......................................................................................................... 61

19.8 Electronic Delivery .............................................................................................. 61

19.9 Binding Effect ...................................................................................................... 61

19.10 No Recourse to Members of Buyer ..................................................................... 61

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

19.12 Change in Electric Market Design ....................................................................... 62

19.13 Further Assurances ............................................................................................... 62 Exhibits:

Exhibit A Facility Description
Exhibit B Facility Construction and Commercial Operation Exhibit C Compensation
Exhibit D Scheduling Coordinator Responsibilities
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Exhibit E Progress Reporting Form
Exhibit F Form of Monthly Expected Available Capacity Report Exhibit G Form of Daily Availability Notice
Exhibit H Form of Commercial Operation Date Certificate Exhibit I Form of Capacity and Efficiency Rate Test Certificate Exhibit J Form of Construction Start Date Certificate
Exhibit K Form of Letter of Credit
Exhibit L Form of Buyer Liability Pass Through Agreement Exhibit M Form of Replacement RA Notice
Exhibit N Notices
Exhibit O Capacity and Efficiency Rate Tests
Exhibit P Facility Availability Calculation
Exhibit Q Operating Restrictions
Exhibit R Metering Diagram
Exhibit S [Intentionally Omitted]
Exhibit T Form of Collateral Assignment Agreement
Exhibit U Material Permits
Exhibit V Project Participants and Liability Shares
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1 ENERGY STORAGE SERVICE AGREEMENT
This Energy Storage Service Agreement (“Agreement”) is entered into as of 01/24/2022 (the “Effective Date”), between Buyer and Seller. Buyer and Seller are sometimes referred to herein individually as a “Party” and jointly as the “Parties.” All capitalized terms used in this Agreement are used with the meanings ascribed to them in Article 1 to this Agreement.

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

ARTICLE 1

DEFINITIONS

1.1 Contract Definitions. The following terms, when used herein with initial capitalization, shall have the meanings set forth below:
“AC” means alternating current.
“Affiliate” means, with respect to any Person, each Person that directly or indirectly controls, is controlled by, or is under common control with such designated Person. For purposes of this definition and the definition of “Permitted Transferee”, “control” (including, with correlative meanings, the terms “controlled by” and “under common control with”), as used with respect to any Person, shall mean (a) the direct or indirect right to cast at least fifty percent (50%) of the votes exercisable at an annual general meeting (or its equivalent) of such Person or, if there are no such rights, ownership of at least fifty percent (50%) of the equity or other ownership interest in such Person, or (b) the right to direct the policies or operations of such Person.

Notwithstanding the foregoing, the Parties hereby agree and acknowledge that with respect to Buyer the public entities designated as members or participants under the Joint Powers Agreement creating Buyer shall not constitute or otherwise be deemed an “Affiliate” for purposes of this Agreement.
“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 frequency regulation, spinning reserve, non-spinning reserve, regulation up, regulation down, voltage support, and any other ancillary services, in each case that the Facility is capable of providing consistent with the Operating Restrictions set forth in Exhibit Q, as each is defined in the CAISO Tariff.

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2 “Approved Maintenance Hours” means up to per Contract Year of Planned Outages for Facility maintenance scheduled in accordance with Section 4.12. “Automated Dispatch System” or “ADS” has the meaning set forth in the CAISO Tariff. “Automatic Generation Control” or “AGC” has the meaning set forth in the CAISO Tariff.
“Availability Adjustment” has the meaning set forth in Exhibit C. “Availability Notice” has the meaning set forth in Section 4.10. “Availability Standards” has the meaning set forth in the CAISO Tariff or such other similar term as modified and approved by FERC hereafter to be incorporated in the CAISO Tariff. “Available Capacity” means the capacity of the Facility, expressed in whole MWs, that is mechanically available to charge and discharge Energy and provide Ancillary Services. “Bankrupt” or “Bankruptcy” means with respect to any entity, such entity that (a) files a petition or otherwise commences, authorizes or acquiesces in the commencement of a proceeding or cause of action under any bankruptcy, insolvency, reorganization or similar Law, (b) has any such petition filed or commenced against it which remains unstayed or undismissed for a period of ninety (90) days, (c) makes an assignment or any general arrangement for the benefit of creditors, (d) otherwise becomes bankrupt or insolvent (however evidenced), (e) has a liquidator, administrator, receiver, trustee, conservator or similar official appointed with respect to it or any substantial portion of its property or assets, or (f) is generally unable to pay its debts as they fall due.
“Battery Charging Factor” means a fraction, the numerator of which is the amount of Charging Energy absorbed by the Facility after the first ten (10) hours of the charging phase of the applicable Capacity Test, and the denominator of which is the Effective Capacity. “Battery Discharging Factor” means one (1) minus a fraction, the numerator of which is the amount of Discharging Energy discharged during the first eight (8) hours of the discharging phase of the applicable Capacity Test, and the denominator of which is the Effective Capacity. “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 Default” means an Event of Default of Buyer.
“Buyer Dispatched Test” has the meaning in Section 4.4(c). “Buyer’s Indemnified Parties” has the meaning set forth in Section 16.1(a).

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3 “Buyer Liability Pass Through Agreement” means the form set forth in Exhibit L. “CAISO” means the California Independent System Operator Corporation or any successor entity performing similar functions.
“CAISO Balancing Authority Area” has the meaning set forth in the CAISO Tariff. “CAISO Certification” means the certification and testing requirements for a storage unit set forth in the CAISO Tariff that are applicable to the Facility, including certification and testing for all Ancillary Services that the Facility can provide, PMAX, and PMIN associated with such storage units, that are applicable to the Facility.
“CAISO Charges Invoice” has the meaning set forth in Exhibit D. “CAISO Dispatch” means any Charging Notice or Discharging Notice given by the CAISO to the Facility, whether through ADS, AGC or any successor communication protocol, communicating an Ancillary Service Award (as defined in the CAISO Tariff) or directing the Facility to charge or discharge at a specific MW rate for a specified period of time or amount of MWh.
“CAISO Grid” has the same meaning as “CAISO Controlled Grid” as defined in the CAISO Tariff.
“CAISO Tariff” means the California Independent System Operator Corporation Agreement and Tariff, Business Practice Manuals (BPMs), and Operating Procedures, as the same may be amended or modified from time-to-time and approved by FERC. “California Renewables Portfolio Standard” or “RPS” means the renewable energy program and policies established by California State Senate Bills 1038 (2002), 1078 (2002), 107 (2008), X-1 2 (2011), 350 (2015), and 100 (2018) as codified in, inter alia, California Public Utilities Code Sections 399.11 through 399.31 and California Public Resources Code Sections 25740 through 25751, as such provisions are amended or supplemented from time to time. “CEC” means the California Energy Commission, or any successor agency performing similar functions.
“Capacity Attribute” means any current or future defined characteristic, certificate, tag, credit, or accounting construct associated with the ability of the Facility to charge, discharge and deliver to the Delivery Point at a particular moment and that can be purchased, sold or conveyed under CAISO or CPUC market rules, including Resource Adequacy Benefits. “Capacity Damages” has the meaning set forth in Section 5 of Exhibit B. “Capacity Test” or “CT” means any test or retest of the Facility to establish the Installed Capacity, Effective Capacity or Efficiency Rate or, subject to the qualifications set forth in Exhibit O, any other test conducted pursuant to Exhibit O.

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4 “CEQA” means the California Environmental Quality Act, as amended or supplemented from time to time.
“Change of Control” means, except in connection with public market transactions of equity interests or capital stock of Seller’s Ultimate Parent, any circumstance in which Ultimate Parent ceases to own, directly or indirectly through one or more intermediate entities, more than fifty percent (50%) of the outstanding equity interests in Seller; provided, in calculating ownership percentages for all purposes of the foregoing:
(a) any ownership interest in Seller held by Ultimate Parent indirectly through one or more intermediate entities shall not be counted towards Ultimate Parent’s ownership interest in Seller unless Ultimate Parent directly or indirectly owns more than fifty percent (50%) of the outstanding equity interests in each such intermediate entity; and (b) ownership interests in Seller owned directly or indirectly by any Lender (including any tax equity provider) shall be excluded from the total outstanding equity interests in Seller. “Charging Energy” means the Energy delivered to the Facility pursuant to a Charging Notice as measured at the Facility Metering Point by the Facility Meter, as such meter readings are adjusted by the CAISO for any applicable Electrical Losses. All Charging Energy not consumed in Electrical Losses or used for Station Use shall be used solely to charge the Facility. “Charging Notice” means the operating instruction, and any subsequent updates, given by Buyer’s SC or the CAISO to Seller, directing the Facility to charge at a specific MW rate for a specified period of time or amount of MWh; provided, any such operating instruction shall be in accordance with the Operating Restrictions. Any instruction to charge the Storage Facility pursuant to a Buyer Dispatched Test shall be considered a Charging Notice. “Collateral Assignment Agreement” has the meaning set forth in Section 14.2 and substantially in the form attached as Exhibit T.
“Commercial Operation” means the condition existing when Seller has fulfilled all of the conditions precedent in Section 2.2 of the Agreement and provided Notice of the same to Buyer; provided, Commercial Operation shall occur no sooner than the Expected Commercial Operation Date.
“Commercial Operation Capacity Test” means the Capacity Test conducted in connection with Commercial Operation of the Facility, including any additional Capacity Test for additional capacity installed after the Commercial Operation Date pursuant to Section 5 of Exhibit B.
“Commercial Operation Date” or “COD” means the later of (a) the Expected Commercial Operation Date or (b) the date on which Commercial Operation is achieved. “Commercial Operation Delay Damages” means an amount equal to (a) the Development Security amount required hereunder, divided by (b) ninety (90).

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5 “Communications Protocols” means certain Operating Restrictions developed by the Parties pursuant to Exhibit Q that involve procedures and protocols regarding communication with respect to the operation of the Facility pursuant to this Agreement. “Compliant Project Participant” means a Project Participant that is not a Defaulted Project Participant.
“Confidential Information” has the meaning set forth in Section 18.1. “Construction Start” has the meaning set forth in Exhibit B. “Construction Start Date” has the meaning set forth in Exhibit B. “Contract Price” has the meaning set forth on the Cover Sheet. “Contract Term” has the meaning set forth in Section 2.1(a). “Contract Year” means a period of twelve (12) consecutive months (plus, in the case of the first Contract Year only, if the Commercial Operation Date does not occur on the first day of a calendar month, the period from the Commercial Operation Date through the end of the calendar month in which the Commercial Operation Date occurs). 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 or, if the Commercial Operation Date does not occur on the first day of a calendar month, the anniversary of the first day of the first full calendar month following the Commercial Operation Date.
“Costs” means, with respect to the Non-Defaulting Party, brokerage fees, commissions and other similar third-party transaction costs and expenses reasonably incurred by such Party either in terminating any arrangement pursuant to which it has hedged its obligations or entering into new arrangements which replace the Agreement; and all reasonable attorneys’ fees and expenses incurred by the Non-Defaulting Party in connection with terminating the Agreement. “Cover Sheet” means the cover sheet to this Agreement, which is incorporated into this Agreement.
“CPM Soft Offer Cap” has he meaning set forth in the CAISO Tariff. “CPUC” means the California Public Utilities Commission, or any successor entity performing similar functions.
“Credit Rating” means, with respect to any entity, the rating then assigned to such entity’s unsecured, senior long-term debt obligations (not supported by third party credit enhancements) or if such entity does not have a rating for its senior unsecured long-term debt, then the rating then assigned to such entity as an issuer rating by S&P or Moody’s. If ratings by S&P and Moody’s are not equivalent, the lower rating shall apply.
“Cure Plan” has the meaning set forth in Section 11.1(b)(iii).

Item 5
Attachment 2
Tumbleweed Energy Storage, LLC Agreement
6 “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 deliveries of Discharging Energy for the following reasons: (i) any System Emergency, or (ii) any warning of an anticipated System Emergency, or warning of an imminent condition or situation, which jeopardizes CAISO’s electric system integrity or the integrity of other systems to which CAISO is connected; (b) a curtailment ordered by the Transmission Provider for reasons including, but not limited to, (i) any situation that affects normal function of the electric system including, but not limited to, any abnormal condition that requires action to prevent circumstances such as equipment damage, loss of load, or abnormal voltage conditions, or (ii) any warning, forecast or anticipation of conditions or situations that jeopardize the Transmission Provider’s electric system integrity or the integrity of other systems to which the Transmission Provider is connected; (c) a curtailment ordered by CAISO or the Transmission Provider due to a Transmission System Outage; or
(d) a curtailment in accordance with Seller’s obligations under its Interconnection Agreement with the Transmission Provider or distribution operator. “Cycles” means the number of equivalent charge/discharge cycles of the Facility during a specified time period, which shall be deemed to be equal to (a) the total cumulative amount of Discharging Energy discharged from the Facility (expressed in MWh) divided by (b) eight (8) hours times the weighted average Effective Capacity for such time period. “Daily Delay Damages” means an amount equal to (a) the Development Security amount required hereunder, divided by (b) one hundred twenty (120). “Damage Payment” means the amount to be paid by the Defaulting Party to the Non-Defaulting Party after a Terminated Transaction occurring prior to the Commercial Operation Date, in a dollar amount set forth in Section 11.3(a).
“Day-Ahead Market” has the meaning set forth in the CAISO Tariff. “Day-Ahead Schedule” has the meaning set forth in the CAISO Tariff. “Dedicated Interconnection Capacity” means the maximum instantaneous amount of Charging Energy and/or Discharging Energy, as applicable, that is permitted to be delivered from and/or to the Delivery Point under Seller’s Interconnection Agreement, in the amount of MWs as set forth on the Cover Sheet.
“Defaulted Liability Share” means the Liability Share of a Defaulted Project Participant. “Defaulted Project Participant” means a Project Participant that has incurred but not cured a Project Participant Payment Default, including any Project Participant whose rights under the Project Participation Share Agreement have been suspended or terminated.

Item 5
Attachment 2
Tumbleweed Energy Storage, LLC Agreement
7 “Defaulting Party” has the meaning set forth in Section 11.1(a). “Delivery Point” means the Facility Pnode on the CAISO grid. “Delivery Term” shall mean the period of Contract Years set forth on the Cover Sheet beginning on the Commercial Operation Date, unless terminated earlier in accordance with the terms and conditions of this Agreement.
“Development Cure Period” has the meaning set forth in Exhibit B. “Development Security” means (a) cash or (b) a Letter of Credit in the amount set forth on the Cover Sheet.
“Discharging Energy” means the Energy delivered from the Facility to the Delivery Point pursuant to a Discharging Notice during any Settlement Interval or Settlement Period, as measured at the Facility Metering Point by the Facility Meter, as such meter readings are adjusted by the CAISO for any applicable Electrical Losses.
“Discharging Notice” means the operating instruction, and any subsequent updates, given by Buyer’s SC or the CAISO to the Facility, directing the Facility to discharge Discharging Energy at a specific MW rate for a specified period of time or to an amount of MWh. Any instruction to discharge the Storage Facility pursuant to a Buyer Dispatched Test shall be considered a Discharging Notice.
“Disclosing Party” has the meaning set forth in Section 18.2. “Dispatch Notice” means any Charging Notice, Discharging Notice and any subsequent updates thereto, given by the CAISO, Buyer or Buyer’s SC, to Seller, directing the Facility to charge or discharge Energy at a specific MWh rate, for a specified period of time, and/or to a specified Storage Level; provided, any such operating instruction or updates shall be in accordance with the Operating Restrictions.
“Early Termination Date” has the meaning set forth in Section 11.2(a). “Effective Capacity” means the lesser of (a) PMAX, and (b) maximum dependable operating capacity of the Facility to discharge Energy for eight (8) hours of continuous discharge, as measured in MW AC at the Delivery Point (i.e., measured at the Facility Meter and adjusted for Electrical Losses to the Delivery Point) as determined pursuant to the most recent Capacity Test (including the Commercial Operation Capacity Test), and as evidenced by a certificate substantially in the form attached as Exhibit I hereto, in either case (a) or (b) up to but not in excess of (i) the Guaranteed Capacity (with respect to a Commercial Operation Capacity Test) or (ii) the Installed Capacity (with respect to any other Capacity Test). “Effective Date” has the meaning set forth on the Preamble. “Effective Flexible Capacity” or “EFC” has the meaning set forth in the CAISO Tariff.

Item 5
Attachment 2
Tumbleweed Energy Storage, LLC Agreement
8 “Efficiency Rate” means the tested rate calculated pursuant to Sections II.I(2) and III(A) of Exhibit O by dividing Discharging Energy by Charging Energy and which for a given calendar month shall be prorated as necessary if more than one Efficiency Rate test has been conducted in such calendar month and different tested Efficiency Rates apply during such calendar month. “Efficiency Rate Adjustment” has the meaning set forth in Exhibit C. “Electrical Losses” means all transmission or transformation losses (a) between the Delivery Point and the Facility Metering Point associated with delivery of Charging Energy, and (b) between the Facility Metering Point and the Delivery Point associated with delivery of Discharging Energy.
“Emission Reduction Credits” or “ERCs” means emission reductions that have been authorized by a local air pollution control district pursuant to California Division 26 Air Resources; Health and Safety Code Sections 40709 and 40709.5, whereby a district has established a system by which all reductions in the emission of air contaminants that are to be used to offset certain future increases in the emission of air contaminants shall be banked prior to use to offset future increases in emissions.
“Energy” means electrical energy, measured in kilowatt-hours, megawatt-hours, or multiple units thereof.
“Energy Management System” or “EMS” means the Facility’s energy management system.
“Environmental Attributes” shall mean any and all attributes under the RPS regulations or under any and all other international, federal, regional, state or other law, rule, regulation, bylaw, treaty or other intergovernmental compact, decision, administrative decision, program (including any voluntary compliance or membership program), competitive market or business method (including all credits, certificates, benefits, and emission measurements, reductions, offsets and allowances related thereto) that are attributable, now, or in the future to the Facility and its displacement of conventional energy generation. “Environmental Attributes” do not include (i) Tax Credits or other tax benefits or attributes, including any cash payments in lieu thereof, (ii) any governmental grants, subsidies or other incentive payments related to the construction, ownership or operation of the Facility, or (iii) any Emission Reduction Credits or Marketable Emission Trading Credits.
“Environmental Cost” means costs incurred in connection with acquiring and maintaining all environmental permits and licenses for the Facility, and the Facility’s compliance with all applicable environmental laws, rules and regulations, including capital costs for pollution mitigation or installation of emissions control equipment required to permit or license the Facility, all operating and maintenance costs for operation of pollution mitigation or control equipment, costs of permit maintenance fees and emission fees as applicable, the costs of all Emission Reduction Credits or Marketable Emission Trading Credits required by any applicable environmental laws, rules, regulations, and permits to operate the Facility, and the costs associated with the disposal and clean-up of hazardous substances introduced to the Site, and the Item 5
Attachment 2
Tumbleweed Energy Storage, LLC Agreement
9 decontamination or remediation, on or off the Site, necessitated by the introduction of such hazardous substances on the Site.
“Event of Default” has the meaning set forth in Section 11.1. “Excused Event” has the meaning set forth in Exhibit P. “Expected Commercial Operation Date” means the date set forth on the Cover Sheet. “Facility” means the energy storage 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 Product (but excluding any Shared Facilities), as such storage facility may be expanded or otherwise modified from time to time in accordance with the terms hereof. “Facility Meter” means a CAISO-approved bi-directional revenue quality meter or meters (with a 0.3% accuracy class), CAISO-approved data processing gateway or remote intelligence gateway, telemetering equipment and data acquisition services sufficient for monitoring, recording and reporting, in real time, the amount of Charging Energy delivered to the Facility Metering Point and the amount of Discharging Energy delivered to the Delivery Point for the purpose of invoicing in accordance with Section 8.1. The Facility may contain multiple measurement devices that will make up the Facility Meter, and, unless otherwise indicated, references to the Facility Meter shall mean all such measurement devices and the aggregated data of all such measurement devices, taken together.
“Facility Metering Point” means the location(s) of the Facility Meter shown in Exhibit R. “Federal Investment Tax Credit Legislation” means validly enacted federal legislation that either (a) applies the ITC in its current form to the Facility, or (b) extends federal Tax Credits associated with capital investment in the construction of energy storage facilities or equipment used to store energy for which Seller, as the owner of the Facility, is eligible. “FERC” means the Federal Energy Regulatory Commission or any successor government agency.
“Flexible Capacity” has the meaning set forth in the CAISO Tariff. “Flexible RAR” means the flexible capacity requirements established for load-serving entities by the CAISO pursuant to the CAISO Tariff, the CPUC pursuant to the Resource Adequacy Rulings, or by any other Governmental Authority.
“Forced Labor” has the meaning set forth in Section 13.4(c). “Force Majeure Event” has the meaning set forth in Section 10.1. “Full Capacity Deliverability Status” or “FCDS” has the meaning set forth in the CAISO Tariff.

Item 5
Attachment 2
Tumbleweed Energy Storage, LLC Agreement
10 “Gains” means, with respect to any Party, an amount equal to the present value of the economic benefit to it, if any (exclusive of Costs), resulting from the termination of this Agreement for the remaining Contract Term, determined in a commercially reasonable manner. Factors used in determining the economic benefit to a Party may include, without limitation, reference to information supplied by one or more third parties, which shall exclude Affiliates of the Non-Defaulting Party, including without limitation, quotations (either firm or indicative) of relevant rates, prices, yields, yield curves, volatilities, spreads or other relevant market data in the relevant markets, comparable transactions, forward price curves based on economic analysis of the relevant markets, settlement prices for comparable transactions at liquid trading hubs (e.g., NP-15), all of which should be calculated for the remaining Contract Term, and include the value of Capacity Attributes.
“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.
“Greenhouse Gas” or “GHG” has the meaning set forth in the GHG Regulations or in any other applicable Laws.
“Guaranteed Availability” has the meaning set forth in Section 4.3(a).

Guaranteed Amount” has the meaning set forth in each Project Participant’s Buyer Liability Pass Through Agreement, which amount may be different for each Project Participant given each Project Participant’s Liability Share.
“Guaranteed Capacity” means the maximum dependable operating capability of the Facility to discharge electric energy, as measured in MW AC at the Delivery Point for eight (8) hours of continuous discharge, as set forth on the Cover Sheet. “Guaranteed Commercial Operation Date” means the date set forth on the Cover Sheet, as such date may be extended pursuant to Exhibit B.
“Guaranteed Construction Start Date” means the date set forth on the Cover Sheet, as such date may be extended pursuant to Exhibit B.
“Guaranteed Efficiency Rate” means the minimum guaranteed Efficiency Rate of the Facility in each Contract Year of the Delivery Term, as set forth on the Cover Sheet. “Guaranteed Flexible Capacity” means, at any point in time, the maximum quantity of Flexible Capacity (in MWs) for which a storage facility having a storage capacity of 69 MW with eight (8) hours of continuous discharging at the maximum rate of discharge, having achieved PCDS sufficient to fully deliver the Facility’s Guaranteed Capacity, and performing with Item 5
Attachment 2
Tumbleweed Energy Storage, LLC Agreement
11 operational characteristics equal to those required by the Guaranteed Availability, Guaranteed Efficiency Rate, and the Operating Restrictions may be counted in any given Showing Month pursuant to the then current Law, including counting conventions set forth in the Resource Adequacy Rulings and the CAISO Tariff applicable to Resource Adequacy Resources. “Guaranteed Net Qualifying Capacity” means, at any point in time, the maximum quantity of Net Qualifying Capacity (in MWs) for which a storage facility having a storage capacity of 69 MW with eight (8) hours of continuous discharging at the maximum rate of discharge, having achieved PCDS sufficient to fully deliver the Facility’s Guaranteed Capacity, and performing with operational characteristics equal to those required by the Guaranteed Availability, Guaranteed Efficiency Rate, and the Operating Restrictions may be counted in any given Showing Month pursuant to the then current Law, including counting conventions set forth in the Resource Adequacy Rulings and the CAISO Tariff applicable to Resource Adequacy Resources.
“Hazardous Substance” means, collectively, (a) any chemical, material or substance that is listed or regulated under applicable Laws as a “hazardous” or “toxic” substance or waste, or as a “contaminant” or “pollutant” or words of similar import, (b) any petroleum or petroleum products, flammable materials, explosives, radioactive materials, asbestos, urea formaldehyde foam insulation, and transformers or other equipment that contain polychlorinated biphenyls, and (c) any other chemical or other material or substance, exposure to which is prohibited, limited or regulated by any Laws.
“Imbalance Energy” means the amount of Energy in MWh, in any given Settlement Period or Settlement Interval, by which the amount of Charging Energy or Discharging Energy, as applicable, deviates from the amount of Scheduled Energy. “Indemnified Party” shall mean (i) Buyer, with respect to all third-party claims, demands, losses, liabilities, penalties, and expenses arising out of, resulting from, or caused by the circumstances described in Section 16.1(a), and (ii) Seller, with respect to all third-party claims, demands, losses, liabilities, penalties, and expenses arising out of, resulting from, or caused by the circumstances described in Section 16.1(b).
“Indemnifying Party” shall mean (i) Seller, with respect to all third-party claims, demands, losses, liabilities, penalties, and expenses arising out of, resulting from, or caused by the circumstances described in Section 16.1(a), and (ii) Buyer, with respect to all third-party claims, demands, losses, liabilities, penalties, and expenses arising out of, resulting from, or caused by the circumstances described in Section 16.1(b).
“Initial Liability Share” means the Liability Share of each Project Participant shown on Exhibit V as of the Effective Date.
“Initial Synchronization” means the commencement of Trial Operations (as defined in the CAISO Tariff).
“Installed Capacity” means the lesser of (a) PMAX, and (b) maximum dependable operating capacity of the Facility to discharge Energy for eight (8) hours of continuous discharge, as measured in MW AC at the Facility Meter Point by the Facility Meter and adjusted for Electrical Item 5
Attachment 2
Tumbleweed Energy Storage, LLC Agreement
12 Losses to the Delivery Point, that achieves Commercial Operation, as evidenced by a certificate substantially in the form attached as Exhibit I hereto, as such capacity may be adjusted pursuant to Section 5 of Exhibit B, but in either case (a) or (b) up to but not in excess of the Guaranteed Capacity.
“Inter-SC Trade” has the meaning set forth in the CAISO Tariff. “Interconnection Agreement” means the interconnection agreement entered into by Seller or a Seller Affiliate pursuant to which the Facility will be interconnected with the Transmission System, and pursuant to which Seller’s Interconnection Facilities and any other Interconnection Facilities will be constructed, operated and maintained during the Contract Term. “Interconnection Facilities” means the interconnection facilities, control and protective devices and metering facilities required to connect the Facility with the Transmission System in accordance with the Interconnection Agreement.
“Interconnection Point” has the meaning set forth in Exhibit A. “Interest Rate” has the meaning set forth in Section 8.2. “ITC” means the investment tax credit established pursuant to Section 48 or other applicable provisions of the United States Internal Revenue Code of 1986. “Joint Powers Act” means the Joint Exercise of Powers Act of the State of California (Government Code Section 6500 et seq.).
“Joint Powers Agreement” means that certain Joint Powers Agreement dated January 29, 2021, as amended from time to time, under which Buyer is organized as a Joint Powers Authority in accordance with the Joint Powers Act.
“kWh” means a kilowatt-hour measured in alternating current, unless expressly stated in terms of direct current.
“Law” means any applicable law, statute, rule, regulation, decision, writ, order, decree or judgment, permit or any interpretation thereof, promulgated or issued by a Governmental Authority.
“Lender” means, collectively, any Person (a) providing senior or subordinated construction, interim, back leverage or long-term debt, equity or tax equity financing or refinancing for or in connection with the development, construction, purchase, installation or operation of the Facility, whether that financing or refinancing takes the form of private debt (including back-leverage debt), equity (including tax equity), public debt or any other form (including financing or refinancing provided to a member or other direct or indirect owner of Seller), including any equity or tax equity investor directly or indirectly providing financing or refinancing for the Facility or purchasing equity ownership interests of Seller and/or its Affiliates, and any trustee or agent or similar representative acting on their behalf, (b) providing interest rate or commodity protection under an agreement hedging or otherwise mitigating the cost of any of Item 5
Attachment 2
Tumbleweed Energy Storage, LLC Agreement
13 the foregoing obligations and/or (c) participating in a lease financing (including a sale leaseback or leveraged leasing structure) with respect to the Facility. “Letter(s) of Credit” means one or more irrevocable, standby letters of credit issued by a U.S. commercial bank or a foreign bank with a U.S. branch with such bank (a) having a Credit Rating of at least A- with an outlook designation of “stable” from S&P or A3 with an outlook designation of “stable” from Moody’s or (b) being reasonably acceptable to Buyer, in a form substantially similar to the letter of credit set forth in Exhibit K. “Liability Share” means the percentage amount set forth for each Project Participant in Exhibit V.
“Licensed Professional Engineer” means an independent, professional engineer selected by Seller and reasonably acceptable to Buyer, licensed in the State of California. “Local Capacity Area Resource” has the meaning set forth in the CAISO Tariff. “Local RAR” means the local Resource Adequacy Requirements established for load-serving entities by the CAISO pursuant to the CAISO Tariff, the CPUC pursuant to the Resource Adequacy Rulings, or by any other Governmental Authority. “Local RAR” may also be known as local area reliability, local resource adequacy, local resource adequacy procurement requirements, or local capacity requirement in other regulatory proceedings or legislative actions. “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., NP-15), all of which should be calculated for the remaining Contract Term and must include the value of Capacity Attributes.

Seller’s lost revenue under this Agreement resulting from a Buyer Default shall not be considered to be consequential, incidental, punitive, exemplary or indirect or business interruption damages for purposes of determining Losses under this Agreement. “Marketable Emission Trading Credits” means emissions trading credits or units pursuant to the requirements of California Division 26 Air Resources; Health & Safety Code Section 39616 and Section 40440.2 for market-based incentive programs such as the South Coast Air Quality Management District’s Regional Clean Air Incentives Market, also known as RECLAIM, and allowances of sulfur dioxide trading credits as required under Title IV of the Federal Clean Air Act (42 U.S.C. § 7651b (a) to (f)).
“Master File” has the meaning set forth in the CAISO Tariff. “Material Permits” means all permits required for Seller to commence construction, as set forth on Exhibit U.

Item 5
Attachment 2
Tumbleweed Energy Storage, LLC Agreement
14 “Maximum Charging Capacity” means the highest level at which the Facility may be charged, expressed in MW and as set forth in Exhibit Q. “Maximum Discharging Capacity” means the highest level at which the Facility may be discharged, expressed in MW and as set forth in Exhibit Q. “Milestones” means the development activities for significant permitting, interconnection, and construction milestones set forth on the Cover Sheet. “Monthly Capacity Availability” has the meaning set forth in Exhibit P. “Monthly Capacity Payment” means the payment required to be made by Buyer to Seller each month of the Delivery Term as compensation for the Product, as calculated in accordance with Exhibit C.
“Moody’s” means Moody’s Investors Service, Inc., or its successor. “Most Offer Obligations” means the obligations to offer the Net Qualifying Capacity in order to satisfy Resource Adequacy Requirements, including under Section 40.6 of the CAISO Tariff.
“MW” means megawatts in alternating current, unless expressly stated in terms of direct current.
“MWh” means megawatt-hour measured in alternating current, unless expressly stated in terms of direct current.
“NERC” means the North American Electric Reliability Corporation, or any successor entity performing similar functions.
“Net Qualifying Capacity” or “NQC” has the meaning set forth in the CAISO Tariff. “Network Upgrades” has the meaning set forth in the CAISO Tariff. “Non-Defaulting Party” has the meaning set forth in Section 11.2. “Notice” shall, unless otherwise specified in the Agreement, mean written communications by a Party to be delivered by hand delivery, United States mail, overnight courier service, or electronic messaging (e-mail).
“Notification Deadline” in respect of a Showing Month shall be fifteen (15) days before the relevant deadlines for the corresponding RA Compliance Showings for such Showing Month. “NP-15” means the Existing Zone Generation Trading Hub for Existing Zone region NP15 as set forth in the CAISO Tariff.
“Operating Restrictions” means those restrictions, rules, requirements, and procedures set forth in Exhibit Q.

Item 5
Attachment 2
Tumbleweed Energy Storage, LLC Agreement
15 “Outage Schedule” has the meaning set forth in Section 4.12(a)(i). “Partial Capacity Deliverability Status” or “PCDS” has the meaning set forth in the CAISO Tariff.
“Party” has the meaning set forth in the Preamble.
“Payment Demand” has the meaning set forth in Exhibit L. “Performance Guarantees” has the meaning set forth in Section 4.3(b). “Performance Security” means (i) cash or (ii) a Letter of Credit in the amount set forth on the Cover Sheet.
“Permitted Transferee” means (i) any Affiliate of Seller or (ii) any entity that satisfies, or is controlled by another Person that satisfies, the following requirements:
(a) A tangible net worth of not less than one hundred fifty million dollars ($150,000,000) or a Credit Rating of at least BBB- from S&P or Baa3 from Moody’s; and (b) At least two (2) years of experience in the ownership and operations of energy generation or storage facilities similar to the Facility or has retained a third-party with such experience to operate the Facility.
“Person” means any individual, sole proprietorship, corporation, limited liability company, limited or general partnership, joint venture, association, joint-stock company, trust, incorporated organization, institution, public benefit corporation, unincorporated organization, government entity or other entity.
“Planned Outage” means a period during which the Facility is either in whole or in part not capable of providing service due to planned maintenance that has been scheduled in advance in accordance with Section 4.12(a).
“PMAX” means the applicable CAISO-certified maximum operating level of the Facility. “PMIN” means the applicable CAISO-certified minimum operating level of the Facility. “PNode” has the meaning set forth in the CAISO Tariff.
“Portfolio” means the portfolio of electrical energy generating, electrical energy storage, or other assets and entities, including the Facility (or the interests of Seller or Seller’s Affiliates or the interests of their respective direct or indirect parent companies), that is pledged as collateral security in connection with a Portfolio Financing.
“Portfolio Financing” means any debt incurred by an Affiliate of Seller that is secured only by a Portfolio.
“Portfolio Financing Entity” means any Affiliate of Seller that incurs debt in connection with any Portfolio Financing.

Item 5
Attachment 2
Tumbleweed Energy Storage, LLC Agreement
16 “Prevailing Wage Requirement” has the meaning set forth in Section 13.4(b). “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 Labor Agreement” has the meaning set forth in Section 13.4(b). “Project Participant” means each Person identified in Exhibit V that shall execute a Buyer Liability Pass Through Agreement in the form set forth in Exhibit L. “Project Participant Approval” means each Project Participant has obtained all necessary approvals from its board or governing authority necessary to execute a Buyer Liability Pass Through Agreement and the Project Participation Share Agreement, and that Buyer has delivered to Seller Buyer Liability Pass Through Agreements and the Project Participation Share Agreement executed by each Project Participant and countersigned by Buyer. “Project Participation Share Agreement” means that certain Tumbleweed Energy Storage Project Participation Share Agreement executed by and among Buyer and all of the Project Participants relating to their allocation among themselves of Buyer’s responsibilities and liabilities under this Agreement, and any successor agreement.
“Project Participant Payment Default” means any failure by a Project Participant to pay any material amount under the Project Participation Share Agreement as and when due (without giving effect to any extensions of time, waivers or late notices), including monthly amounts collected to fund, or to reserve funds for, payment of Buyer’s obligations under this Agreement. “Pro Rata” means, for purposes of calculating a Project Participant’s Revised Liability Share, the ratio of (i) such Project Participant’s Initial Liability Share to (ii) the sum of the Initial Liability Shares of all of the Compliant Project Participants. “Prudent Operating Practice” means (a) the applicable practices, methods and acts required by or consistent with applicable Laws and reliability criteria, and otherwise engaged in or approved by a significant portion of the electric industry during the relevant time period with respect to grid-interconnected, utility-scale energy storage facilities in the Western United States, and (b) any of the practices, methods and acts which, in the exercise of reasonable judgment in light of the facts known at the time the decision was made, could have been expected to accomplish the desired result at a reasonable cost consistent with good business practices, reliability, safety and expedition. Prudent Operating Practice is not intended to be limited to the optimum practice, method or act to the exclusion of all others, but rather to acceptable practices, methods or acts generally accepted in the industry with respect to grid-interconnected, utility-scale energy storage facilities in the Western United States. Prudent Operating Practice shall include compliance with applicable Laws, applicable safety and reliability criteria, and the applicable criteria, rules and standards promulgated in the National Electric Safety Code and the National Electrical Code, as they may be amended or superseded from time to time, including the criteria, rules and standards of any successor organizations.
“Qualifying Capacity” has the meaning set forth in the CAISO Tariff.

Item 5
Attachment 2
Tumbleweed Energy Storage, LLC Agreement
17 “RA Compliance Showing” means the (a) System RAR compliance or advisory showings (or similar or successor showings) and (b) Flexible RAR compliance or advisory showings (or similar successor showings), in each case, an entity is required to make to the CAISO pursuant to the CAISO Tariff, to the CPUC (and, to the extent authorized by the CPUC, to the CAISO) pursuant to the Resource Adequacy Rulings, or to any Governmental Authority. “RA 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 3.5(b). “RA Guarantee Date” means the Commercial Operation Date, which is the date by which the Facility is expected to have achieved Partial Capacity Deliverability Status sufficient to fully deliver the Facility’s Guaranteed Capacity.
“RA Penalties” means the RA penalties assessed against load serving entities by the CPUC for RA deficiencies that are not replaced or cured, as established by the CPUC in the Resource Adequacy Rulings and subsequently incorporated into the annual Filing Guide for System, Local and Flexible Resource Adequacy Compliance Filings that is issued by the CPUC Energy Division, or any replacement or successor documentation established by the CPUC Energy Division to reflect RA penalties that are established by the CPUC and assessed against load serving entities for RA deficiencies.
“RA Shortfall Month” means any Showing Month, commencing with the Showing Month that contains the RA Guarantee Date, during which either:
(a) the Facility has not achieved PCDS sufficient to fully deliver the Facility’s Guaranteed Capacity; or
(b) the Net Qualifying Capacity of the Facility for such Showing Month was either (i) not published by or otherwise established with the CAISO by the Notification Deadline for such Showing Month, or (ii) was less than the then applicable Guaranteed Net Qualifying Capacity of the Facility for such Showing Month; or
(c) the Effective Flexible Capacity of the Facility for such Showing Month was either (i) not published by or otherwise established with the CAISO by the Notification Deadline for such Showing Month, or (ii) was less than the then applicable Guaranteed Flexible Capacity of the Facility for such Showing Month.
“Real-Time Market” has the meaning set forth in the CAISO Tariff. “Receiving Party” has the meaning set forth in Section 18.2. “Reliability Network Upgrades” has the meaning set forth in the CAISO Tariff. “Remedial Action Plan” has the meaning in Section 2.4.
“Replacement RA” means Resource Adequacy Benefits, if any, (a) equivalent to those that would have been provided by the Facility with respect to the applicable month in which a RA Item 5
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18 Deficiency Amount is due to Buyer, unless Buyer consents to accept Replacement RA from another facility, and (b) located within the CAISO Balancing Authority Area. “Requested Confidential Information” has the meaning set forth in Section 18.2. “Resource Adequacy Benefits” means the rights and privileges attached to the Facility that satisfy any entity’s Resource Adequacy Requirements, as those obligations are set forth in any ruling issue by the CPUC, including the Resource Adequacy Rulings, or the CAISO Tariff, and shall include Flexible Capacity, and any local, zonal or otherwise locational attributes associated with the Facility.
“Resource Adequacy Capacity” or “RA Capacity” has the meaning set forth in the CAISO Tariff.
“Resource Adequacy Requirements” or “RAR” means the resource adequacy requirements applicable to an entity as established by the CAISO pursuant to the CAISO Tariff, by the CPUC pursuant to the Resource Adequacy Rulings, or by any other Governmental Authority.
“Resource Adequacy Resource” shall have the meaning used in Resource Adequacy Rulings.
“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, 20-06-031, 20-06- 028, 20-12-006 and any other existing or subsequent ruling or decision, or any other resource adequacy laws, rules or regulations enacted, adopted or promulgated by the CPUC or the CAISO, however described, as such decisions, rulings, Laws, rules or regulations may be amended or modified from time-to-time throughout the Contract Term. “Revised Liability Share” means the sum of a Project Participant’s Initial Liability Share plus its Pro Rata portion of all Defaulted Liability Shares, not to exceed one hundred twenty-five percent (125%) of such Participant’s Initial Liability Share. “S&P” means the Standard & Poor’s Financial Services, LLC (a subsidiary of S&P Global Inc.) or its successor.
“SCADA Systems” 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, and “Scheduled” and “Scheduling” have a corollary meaning.
“Scheduled Energy” means the Charging Energy or Discharging Energy, as applicable, that clears under the applicable CAISO market based on the final Day-Ahead Schedule, FMM Item 5
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19 Schedule (as defined in the CAISO Tariff), and/or any other financially binding Schedule, market instruction or CAISO dispatch for the Facility for a given period of time implemented in accordance with the CAISO Tariff.
“Scheduling Coordinator” or “SC” means an entity certified by the CAISO as qualifying as a Scheduling Coordinator pursuant to the CAISO Tariff for the purposes of undertaking the functions specified in “Responsibilities of a Scheduling Coordinator,” of the CAISO Tariff, as amended from time to time.
“Security Interest” has the meaning set forth in Section 8.9. “Seller” has the meaning set forth on the Cover Sheet.
“Seller’s Indemnified Parties” has the meaning set forth in Section 16.1(b). “Seller Initiated Test” has the meaning set forth in Section 4.4(c). “Settlement Amount” means the Non-Defaulting Party’s Costs and Losses, on the one hand, netted against its Gains, on the other. If the Non-Defaulting Party’s Costs and Losses exceed its Gains, then the Settlement Amount shall be an amount owing to the Non-Defaulting Party. If the Non-Defaulting Party’s Gains exceed its Costs and Losses, then the Settlement Amount shall be zero dollars ($0). The Settlement Amount shall not include consequential, incidental, punitive, exemplary or indirect or business interruption damages for purposes of this Agreement, except to the extent that Seller’s lost revenue under this Agreement resulting from a Buyer Default may be included in the determination of Losses.
“Settlement Interval” has the meaning set forth in the CAISO Tariff. “Settlement Period” has the meaning set forth in the CAISO Tariff. “Shared Facilities” means the gen-tie lines, transformers, substations, or other equipment, permits, contract rights, and other assets and property (real or personal), in each case, as necessary to enable delivery of Discharging 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 Month” shall be a calendar month of the Delivery Term, commencing with the Showing Month that contains the RA Guarantee Date, that is the subject of a RA Compliance Showing, as set forth in the Resource Adequacy Rulings and outlined in the CAISO Tariff. For illustrative purposes only, pursuant to the CAISO Tariff and Resource Adequacy Rulings in effect as of the Effective Date, the monthly RA Compliance Showing made in June is for the Showing Month of August.
“Site” means the real property on which the Facility is or will be located, as further described in Exhibit A, and as shall be updated by Seller at the time Seller provides an executed Construction Start Date certificate in the form of Exhibit J to Buyer; provided, that any such update to the Site that includes real property that was not originally contained within the Site boundaries Item 5
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20 described in Exhibit A shall be subject to Buyer’s approval of such updates in its sole discretion. “Site” does not include any land rights or interests in the real property constituting the Site that relate to or are used by other projects constructed or owned by Seller or its Affiliates. “Site Control” means that, for the Contract Term, Seller (or, prior to the Delivery Term, its Affiliate): (a) owns or has the option to purchase the Site; (b) is the lessee or has the option to lease the Site; or (c) is the holder of an easement or an option for an easement, right-of-way grant, or similar instrument with respect to the Site.
“State of Charge” or “SOC” means the ratio of (a) the Storage Level of the Facility to (b) the Effective Capacity multiplied by eight (8) hours, expressed as a percentage. “Station Use” means the Energy that is used within the Facility to power the lights, motors, temperature control systems, control systems and other electrical loads that are necessary for operation of the Facility (or as otherwise defined by the retail energy provider and CAISO Tariff) except during periods in which the Storage Facility is charging or discharging pursuant to a Charging Notice or Discharging Notice.
“Step-Up Event” means the forty-fifth (45th) day following the occurrence of a Project Participant Payment Default if such Project Participant Payment Default has not been cured by that date, regardless of whether or not notice was given to the Defaulted Project Participant under the Project Participation Share Agreement or otherwise or by Buyer hereunder. “Storage Level” means, at a particular time, the amount of electric Energy in the Facility available to be discharged as Discharging Energy, expressed in MWh. “Subsequent Purchaser” 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 O. “Supply Plan” has the meaning set forth in the CAISO Tariff. “System Emergency” means any condition that requires, as determined and declared by CAISO or the Transmission Provider, automatic or immediate action to (i) prevent or limit harm to or loss of life or property, (ii) prevent loss of transmission facilities or generation supply in the immediate vicinity of the Facility, or (iii) to preserve Transmission System reliability. “System RAR” means the Resource Adequacy Requirements established for load-serving entities by the CAISO pursuant to the CAISO Tariff, the CPUC pursuant to the Resource Adequacy Rulings, or by any other Governmental Authority. “System RAR” may also be known as system area reliability, system resource adequacy, system resource adequacy procurement requirements, or system capacity requirement in other regulatory proceedings or legislative actions. “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 Item 5
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21 use, stamp, transfer, payroll, unemployment, income, and any and all items of withholding, deficiency, penalty, additions, interest or assessment related thereto. “Tax Credits” means any (i) federal production tax credit, depreciation benefit, tax deduction and/or investment tax credit, including the ITC, specific to investments in renewable energy facilities and/or energy storage facilities and (ii) any refundable credit, grant, or other cash payment in lieu of an incentive described in clause (i). “Terminated Transaction” has the meaning set forth in Section 11.2(a). “Termination Payment” has the meaning set forth in Section 11.3(b). “Transmission Provider” means any entity that 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 for the purpose of transmitting or transporting the Discharging Energy from the Delivery Point. “Transmission System” means the transmission facilities operated by the CAISO, now or hereafter in existence, which provide energy transmission service downstream from the Delivery Point.
“Transmission System Outage” means an outage on the Transmission System, other than a System Emergency, that is not caused by Seller’s actions or inactions and that prevents Buyer or the CAISO (as applicable) from receiving Facility Energy onto the Transmission System. “Ultimate Parent” means Rev Renewables, LLC, a Delaware limited liability company. “Unplanned Outage” means a period during which the Facility is not capable of providing service due to the need to maintain or repair a component thereof, which period is not a Planned Outage.

1.2 Rules of Interpretation. In this Agreement, except as expressly stated otherwise or unless the context otherwise requires:
(a) headings and the rendering of text in bold and italics are for convenience and reference purposes only and do not affect the meaning or interpretation of this Agreement; (b) words importing the singular include the plural and vice versa and the masculine, feminine and neuter genders include all genders; (c) the words “hereof”, “herein”, and “hereunder” and words of similar import shall refer to this Agreement as a whole and not to any particular provision of this Agreement; (d) a reference to an Article, Section, paragraph, clause, Party, or Exhibit is a reference to that Article, Section, paragraph, clause of, or that Party or Exhibit to, this Agreement unless otherwise specified;
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22 (e) a reference to a document or agreement, including this Agreement shall mean such document, agreement or this Agreement including any amendment or supplement to, or replacement, novation or modification of this Agreement, but disregarding any amendment, supplement, replacement, novation or modification made in breach of such document, agreement or this Agreement;
(f) a reference to a Person includes that Person’s successors and permitted assigns;
(g) the terms “include” and “including” mean “include or including (as applicable) without limitation” and any list of examples following such term shall in no way restrict or limit the generality of the word or provision in respect of which such examples are provided;
(h) references to any statute, code or statutory provision are to be construed as a reference to the same as it may have been, or may from time to time be, amended, modified or reenacted, and include references to all bylaws, instruments, orders and regulations for the time being made thereunder or deriving validity therefrom unless the context otherwise requires; (i) in the event of a conflict, a mathematical formula or other precise description of a concept or a term shall prevail over words providing a more general description of a concept or a term;
(j) references to any amount of money shall mean a reference to the amount in United States Dollars;
(k) the expression “and/or” when used as a conjunction shall connote “any or all of”;
(l) words, phrases or expressions not otherwise defined herein that (i) have a generally accepted meaning in Prudent Operating Practice shall have such meaning in this Agreement or (ii) do not have well known and generally accepted meaning in Prudent Operating Practice but that have well known and generally accepted technical or trade meanings, shall have such recognized meanings; and
(m) each Party acknowledges that it was represented by counsel in connection with this Agreement and that it or its counsel reviewed this Agreement and that any rule of construction to the effect that ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of this Agreement.

ARTICLE 2
TERM; CONDITIONS PRECEDENT

2.1 Contract Term.
(a) The term of this Agreement shall commence on the Effective Date and shall remain in full force and effect until the conclusion of the Delivery Term, subject to any early termination provisions set forth herein, including Section 2.1(b) (“Contract Term”); provided, Item 5
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23 Buyer’s obligations to pay for or accept any Product are subject to Seller’s completion of the conditions precedent pursuant to Section 2.2.
(b) Notwithstanding anything to the contrary in this Agreement, if Project Participant Approval of this Agreement is not obtained within ninety (90) days following the Effective Date, then either Party may terminate this Agreement upon written Notice to the other Party. Upon such termination, neither Party shall have any liability to the other Party, save and except for those obligations specified in Section 2.1(c), and Buyer shall promptly return to Seller any Development Security then held by Buyer, if any, less any amounts drawn in accordance with this Agreement.
(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 18 shall remain in full force and effect for two (2) years following the termination of this Agreement, and all indemnity and audit rights shall remain in full force and effect for three (3) years following the termination of this Agreement.

2.2 Commercial Operation; Conditions Precedent. Seller shall provide Notice to Buyer of the expected Commercial Operation Date at least sixty (60) days in advance of such date.

Seller shall provide Notice to Buyer when Seller believes it has provided the required documentation to Buyer and met all the conditions precedent set forth below for achieving Commercial Operation. Following Buyer’s receipt of such Notice, Buyer shall have five (5) Business Days to approve or reject Seller’s request for confirmation of Commercial Operation, which, if confirmed, shall be deemed to have occurred as of the date of such Notice. Upon Buyer’s approval of Seller’s achievement of Commercial Operation, Buyer shall provide Seller with written acknowledgement of the Commercial Operation Date. (a) Seller shall have delivered to Buyer (i) a completion certificate from a Licensed Professional Engineer substantially in the form of Exhibit H and (ii) a certificate from a Licensed Professional Engineer substantially in the form of Exhibit I setting forth the Installed Capacity and Efficiency Rate on the Commercial Operation Date; (b) Seller has executed an Interconnection Agreement with the Transmission Provider, which shall be in full force and effect and a copy of the Interconnection Agreement delivered to Buyer;
(c) Seller has provided Buyer with a copy of written notice from CAISO that the Facility has achieved Partial Capacity Deliverability Status sufficient to fully deliver the Facility’s Guaranteed Capacity, if applicable;
(d) A Participating Generator Agreement and a Meter Service Agreement between Seller and CAISO shall have been executed and delivered and be in full force and effect, and a copy of each such agreement delivered to Buyer;
(e) Seller has obtained CAISO Certification for the Facility;The Facility has successfully completed all testing required by Prudent Operating Practice or any requirement of Law to operate the Facility;
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24 (f) All applicable regulatory authorizations, approvals and permits for the operation of the Facility have been obtained and all conditions thereof that are capable of being satisfied on the Commercial Operation Date have been satisfied and shall be in full force and effect;
(g) Seller has Site Control;
(h) Seller has delivered the Performance Security to Buyer in accordance with Section 8.8;
(i) Insurance requirements for the Facility have been met, with evidence provided in writing to Buyer, in accordance with Section 17.1; and (j) Seller has paid Buyer for all amounts owing under this Agreement, if any, including Daily Delay Damages and Commercial Operation Delay Damages.

2.3 Development; Construction; Progress Reports. 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 agrees to regularly scheduled meetings between representatives of Buyer and Seller to review such reports and discuss Seller’s construction progress. The form of the Progress Report is set forth in Exhibit E. Seller shall also provide Buyer with any reasonably requested documentation (subject to confidentiality restrictions) directly related to the achievement of Milestones within ten (10) Business Days of receipt of such request by Seller. Seller is solely responsible for the design and construction of the Facility, including the location of the Site, the Facility layout, and the selection and procurement of the equipment comprising the Facility.

2.4 Remedial Action Plan. If Seller misses a Milestone by more than thirty (30) days, except as the result of Force Majeure Event or Buyer Default, Seller shall submit to Buyer, within ten (10) Business Days of the end of such thirty (30)-day period following the Milestone completion date, a remedial action plan (“Remedial Action Plan”), which will describe in detail any delays (actual or anticipated) beyond the scheduled Milestone dates, including the cause of the delay (e.g., governmental approvals, financing, property acquisition, design activities, equipment procurement, project construction, interconnection, or any other factor), Seller’s detailed description of its proposed course of action to achieve the missed Milestones and all subsequent Milestones by the Guaranteed Commercial Operation Date; provided, delivery of any Remedial Action Plan shall not relieve Seller of its obligation to provide Remedial Action Plans with respect to any subsequent Milestones and to achieve the Guaranteed Commercial Operation Date in accordance with the terms of this Agreement. Subject to the provisions of Exhibit B, so long as Seller complies with its obligations under this Section 2.4, Seller shall not be considered in default of its obligations under this Agreement solely as a result of missing any Milestone; provided, in the event Seller misses any Milestone and Seller provides Notice to Buyer that it is not likely to be able to achieve the Commercial Operation Date by the Guaranteed Commercial Operation Date as may be extended pursuant to Exhibit B, Buyer shall have the right to terminate this Agreement and retain the Development Security as liquidated damages and as its exclusive remedy, and neither Party shall have any further liability under this Agreement arising after the date of Item 5
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25 termination. Such termination right must be exercised, if at all, within ten (10) Business Days after Buyer’s receipt of Seller’s Notice that it is not likely to be able to achieve the Commercial Operation Date by the Guaranteed Commercial Operation Date (as may be extended pursuant to Exhibit B).

2.5 Pre-Commercial Operation Actions. The Parties agree that, in order for Buyer to dispatch the Facility for its Commercial Operation Date, the Parties will have to perform certain of their Delivery Term obligations in advance of the Commercial Operation Date, including, without limitation, Seller’s delivery of an Availability Notice for the Commercial Operation Date, and delivery of a Dispatch Notice and nominating and scheduling the Facility for the Commercial Operation Date, in advance of the Commercial Operation Date. The Parties shall cooperate with each other in order for Buyer to be able to dispatch the Facility for the Commercial Operation Date. In addition, Seller shall have the right to operate the Facility prior to the Commercial Operation Date, so long as such operation does not interfere with Seller’s ability to perform its obligations under this Agreement from and after the Commercial Operation Date.

ARTICLE 3

PURCHASE AND SALE

3.1 Product. Subject to the terms and conditions of this Agreement, during the Delivery Term, Buyer shall have the exclusive right to the Installed Capacity and Effective Capacity, as applicable, and all Product associated therewith. Seller has all rights to the Installed Capacity and Effective Capacity, as applicable, and all Product associated therewith and after the Delivery Term. Seller shall operate the Facility and make available, charge and discharge, deliver, and sell the Product therefrom to Buyer when and as the Facility is available, subject to the terms and conditions of this Agreement, including the Operating Restrictions. Seller represents and warrants that it will deliver the Product to Buyer free and clear of all liens, security interests, claims and encumbrances. Seller shall not substitute or purchase any energy storage capacity, Energy, Ancillary Services or Capacity Attributes from any other energy storage resource or the market for delivery hereunder except as otherwise provided herein, nor shall Seller sell, assign or otherwise transfer any Product, or any portion thereof, to any third party other than to Buyer or the CAISO pursuant to this Agreement.

3.2 Discharging Energy. Subject to the terms and conditions of this Agreement, Seller commits to make available the Discharging Energy to Buyer during the Delivery Term, and Buyer shall have the exclusive rights to all such Discharging Energy, subject to the Operating Restrictions. Title to and risk of loss related to the Discharging Energy shall pass and transfer from Seller to Buyer at the Delivery Point.

3.3 Capacity Attributes. Seller shall request Partial Capacity Deliverability Status sufficient to fully deliver the Facility’s Guaranteed Capacity in the CAISO generator interconnection process. As between Buyer and Seller, Seller shall be responsible for the cost and installation of any Network Upgrades associated with obtaining such Partial Capacity Deliverability Status.
(a) Throughout the Delivery Term, Seller grants, pledges, assigns and otherwise commits to Buyer all the Capacity Attributes from the Facility.

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26 (b) Throughout the Delivery Term, Seller shall maintain Partial Capacity Deliverability Status sufficient to fully deliver the Facility’s Guaranteed Capacity for the Facility from the CAISO and shall perform all actions necessary to ensure that the Facility qualifies to provide Resource Adequacy Benefits, including Flexible Capacity, to Buyer. Throughout the Delivery Term, Seller hereby covenants and agrees to transfer all Resource Adequacy Benefits from the Facility to Buyer.
(c) For the duration of the Delivery Term, Seller shall take all commercially reasonable actions, including complying with all applicable registration and reporting requirements, and execute all documents or instruments necessary to enable Buyer to use all of the Capacity Attributes committed by Seller to Buyer pursuant to this Agreement.

3.4 Ancillary Services; Environmental Attributes.
(a) Ancillary Services. Buyer shall have the exclusive rights to all Ancillary Services that the Facility is capable of providing during the Delivery Term consistent with the Operating Restrictions, with characteristics and quantities determined in accordance with the CAISO Tariff. Seller shall operate and maintain the 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 Capacity. Upon Buyer’s reasonable request, Seller shall submit the Facility for additional CAISO Certification so that the Facility may provide additional Ancillary Services that the Facility is, at the relevant time, actually physically capable of providing consistent with the definition of Ancillary Services herein and without modification of the Facility, provided that Buyer has agreed to reimburse Seller for any costs Seller incurs in connection with conducting such additional CAISO Certification. (b) Environmental Attributes. Buyer shall have the exclusive rights during the Delivery Term to any Environmental Attributes existing on the Effective Date or that may come into existence during the Contract Term. Buyer shall bear all costs and risks associated with the transfer, qualification, verification, registration and ongoing compliance for such Environmental Attributes. Upon Seller’s receipt of Notice from Buyer of Buyer’s intent to claim such Environmental Attributes, the Parties shall determine the necessary actions and additional costs associated with such Environmental Attributes. Seller shall have no obligation to bear any costs, losses or liability, or alter the Facility, unless the Parties in their discretion have agreed on all necessary terms and conditions relating to such alteration and Buyer has agreed to reimburse Seller for all costs, losses, and liabilities associated with such alteration.

3.5 Resource Adequacy Failure.
(a) RA Deficiency Determination. For each RA Shortfall Month, Seller shall pay to Buyer as liquidated damages the RA Deficiency Amount, as set forth in Section 3.5(b), and/or provide Replacement RA, as set forth in Section 3.5(c), as the exclusive remedy for the Capacity Attributes that Seller failed to convey to Buyer. (b) RA Deficiency Amount Calculation. For each RA Shortfall Month, Seller shall pay to Buyer an amount (the “RA Deficiency Amount”) equal to the product of:
(i) The greater of:

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the difference, expressed in kW, of the then applicable Guaranteed Net Qualifying Capacity of the Facility, minus the then applicable Net Qualifying Capacity of die Facility that may be included in Supply Plans by Buyer, which shall be deemed to be zero (0) MW if the Net Qualifying Capacity has not been published by or otherwise established with the CAISO by the Notification Deadline for such RA Shortfall Month, plus any Replacement RA that was able to be included in Supply Plans for the Showing Month by Buyer; and
(A)
the difference, expressed in kW, of the then applicable Guaranteed Effective Capacity of the Facility, minusthe then applicable Effective Flexible Capacity of the Facility that may be included in Supply Plans by Buyer, which shall be deemed to be zero (0) MW if the Effective Flexible Capacity has not been published by or otherwise established with the CAISO by the Notification Deadline for such RA Shortfall Month, plus any Effective Flexible Capacity that was provided as Replacement RA that was able to be included in Supply Plans in the Showing Month by Buyer; (B)
If Seller anticipates that it will have an RA Shortfall Month, Seller may, provide Replacement RA in the amount of (i) the Guaranteed Net Qualifying Capacity and/or Guaranteed Flexible Capacity, as applicable, of the Facility with respect to such Showing Month, minus (ii) the expected Net Qualifying Capacity and/or Effective Flexible Capacity, as applicable, of the Facility with respect to such Showing Month; provided, that any Replacement RA is communicated by Seller to Buyer in a Notice substantially in the form of Exhibit M at least sixty (60) days before the RA Shortfall Month.

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 CapacityAttributesforre-sale into such market, and Buyershallretain and receive allrevenues from such re-sale. Sellershall 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 3.6, Seller shall be liable to Buyer for the amounts Seller would have owed Buyer under this Agreement if Buyer had not resold the Product.

3.6 ARTICLE 4

OBLIGATIONS AND DELIVERIES

4.1 Delivery.
(a) Subject to the provisions of this Agreement, including Section 4.9(a), 27 28
commencing on the Commercial Operation Date through the end of the Contract Term, Seller shall supply and deliver the Product to Buyer at the Delivery Point, and Buyer shall take delivery of the Product at the Delivery Point in accordance with the terms of this Agreement. Seller shall be responsible for paying or satisfying when due any costs or charges imposed in connection with the delivery of Discharging Energy to the Delivery Point, including any operation and maintenance charges imposed by the Transmission Provider directly relating to the Facility’s operations. Buyer shall be responsible for all costs, charges and penalties, if any, imposed in connection with the delivery of Discharging Energy at and after the Delivery Point, including without limitation transmission costs and transmission line losses and imbalance charges. Commencing as of the Commercial Operation Date, the Charging Energy and Discharging Energy will be scheduled to the CAISO by Buyer in accordance with Exhibit D.
(b) Seller shall be permitted to reduce deliveries of applicable Products during periods of Planned Outages, Unplanned Outages, Force Majeure Events and Curtailment Orders and as necessary to maintain health and safety pursuant to Section 6.2.

4.2 Interconnection. Seller shall be responsible for all costs of interconnecting the Facility to the Interconnection Point. During the Delivery Term, Seller shall maintain the Dedicated Interconnection Capacity for the Facility’s sole use.

4.3 Performance Guarantees.
(a) During the Delivery Term, the Facility shall maintain a Monthly Capacity Availability during each month of no less than (the “Guaranteed Availability”), which Monthly Capacity Availability shall be calculated in accordance with Exhibit P.
(b) During the Delivery Term, the Facility shall maintain an Efficiency Rate of no less than Guaranteed Efficiency Rate, which Efficiency Rate shall be calculated in accordance with Exhibit O. The Guaranteed Availability and Guaranteed Efficiency Rate are collectively the “Performance Guarantees”.
(c) Buyer’s sole remedies for Seller’s failure to achieve the Performance Guarantees are: (i) for the Guaranteed Availability, (1) the Availability Adjustment to the Monthly Capacity Payment, as set forth in Exhibit C, and (2) the Seller Event of Default as set forth in Section 11.1(b)(iii) and the applicable remedies set forth in Article 11; and (ii) for the Guaranteed Efficiency Rate, the Efficiency Rate Adjustment to the Monthly Capacity Payment, as set forth in Exhibit C.

4.4 Facility Testing.
(a) Capacity Tests. Prior to the Commercial Operation Date, Seller shall schedule and complete a Commercial Operation Capacity Test in accordance with Exhibit O.

Thereafter, Seller and Buyer shall have the right to run additional Capacity Tests in accordance with Exhibit O.
(i) Buyer shall have the right to send one or more representative(s) to witness all Capacity Tests.

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29 (ii) Following each Capacity Test, Seller shall submit a testing report in accordance with Exhibit O. If the actual capacity or efficiency rate determined pursuant to a Capacity Test varies from the then-current Effective Capacity and/or Efficiency Rate, as applicable, then the actual capacity and/or efficiency rate determined pursuant to such Capacity Test shall become the new Effective Capacity and/or Efficiency Rate, at the beginning of the day following the completion of the test for all purposes under this Agreement. (b) Additional Testing. Seller shall conduct such additional testing as necessary to ensure the Facility is functioning properly and the Facility is able to respond to Dispatch Notices pursuant to Section 4.6(b).
(c) Any testing of the Facility requested by Buyer after the Commercial Operation Capacity Tests, and all required annual tests pursuant to Section B of the section headed “Capacity Test Notice and Frequency” in Exhibit O, shall be deemed Buyer-instructed dispatches of the Facility (“Buyer Dispatched Test”). Any test of the Facility that is not a Buyer Dispatched Test, including all tests conducted prior to Commercial Operation, any Commercial Operation Capacity Test, any Capacity Test conducted if the Effective Capacity immediately prior to such Capacity Test is below , any test required by
CAISO (including any test required to obtain or maintain CAISO Certification), and other Seller-requested discretionary tests or dispatches, at times and for durations reasonably agreed to by Buyer, that Seller deems necessary for purposes of reliably operating or maintaining the Facility or for re-performing a required test within a reasonable number of days of the initial required test (considering the circumstances that led to the need for a retest) shall be deemed a “Seller Initiated Test”.
(i) For any Seller Initiated Test other than a Capacity Test required by Exhibit O for which there is a stated notice requirement, Seller shall notify Buyer no later than twenty-four (24) hours prior thereto (or any shorter period reasonably acceptable to Buyer consistent with Prudent Operating Practices).
(ii) No Dispatch Notices shall be issued during any Seller Initiated Test.

Dispatch Notices may be issued during a Buyer Dispatched Test as reasonably necessary to implement the applicable test. The Facility shall be deemed unavailable during any Seller Initiated Test. Any Buyer Dispatched Test shall be deemed an Excused Event for the purposes of calculating the Monthly Capacity Availability.

4.5 Testing Costs and Revenues.
(a) Buyer shall be responsible for paying for all Charging Energy and shall be entitled to all CAISO revenues associated with a Buyer Dispatched Test. Seller shall be responsible for paying for all Energy to charge the Facility and shall be entitled to all CAISO revenues associated with a Seller Initiated Test. Buyer shall pay to Seller, in the month following Buyer’s receipt of such CAISO revenues and otherwise in accordance with Exhibit C, all applicable CAISO revenues received by Buyer and associated with the discharge Energy associated with such Seller Initiated Test.

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30 (b) Buyer shall be responsible for all costs, expenses and fees payable or reimbursable to its representative(s) witnessing any Facility test. (c) Except as set forth in Sections 4.5(a) and (b), all other costs of any testing of the Facility shall be borne by Seller.

4.6 Facility Operations.
(a) Seller shall operate the Facility in accordance with Prudent Operating Practices.
(b) During the Delivery Term, Seller shall maintain SCADA Systems, communications links, and other equipment necessary to receive automated Dispatch Notices consistent with CAISO protocols and practice (“Automated Dispatches”). In the event of the failure or inability of the Facility to receive Automated Dispatches, Seller shall use all commercially reasonable efforts to repair or replace the applicable components as soon as reasonably possible, and if there is any material delay in such repair or replacement, Seller shall provide Buyer with a written plan of all actions Seller plans to take to repair or replace such components for Buyer’s review and comment. During any period during which the Facility is not capable of receiving or implementing Automated Dispatches, Seller shall implement back-up procedures consistent with the CAISO Tariff and CAISO protocols to enable Seller to receive and implement non-automated Dispatch Notices (“Alternative Dispatches”). (c) Seller shall maintain a daily operations log for the Facility which shall include but not be limited to information on Energy charging and discharging, electricity consumption and efficiency (if applicable), availability, outages, changes in operating status, inspections and any other significant events related to the operation of the Facility. Information maintained pursuant to this Section 4.6(c) shall be provided to Buyer within fifteen (15) days of Buyer’s request.
(d) Seller shall maintain accurate records with respect to all Capacity Tests. (e) Seller shall maintain and make available to Buyer records, including logbooks, demonstrating that the Facility is operated in accordance with Prudent Operating Practices. Seller shall comply with all reporting requirements and permit on-site audits, investigations, tests and inspections permitted or required under any Prudent Operating Practices.

4.7 Dispatch Notices. Buyer shall have the right to dispatch the Facility seven (7) days per week and twenty-four (24) hours per day (including holidays), by providing Dispatch Notices, subject to the requirements and limitations set forth in this Agreement, including the Operating Restrictions. Subject to the Operating Restrictions, each Dispatch Notice shall be effective unless and until such Dispatch Notice is modified by the CAISO, Buyer or Buyer’s SC. If Automated Dispatches are not possible for reasons beyond Buyer’s control, Alternative Dispatches may be provided pursuant to Section 4.6(b).

4.8 Facility Unavailability to Receive Dispatch Notices. To the extent the Facility is unable to receive or respond to Dispatch Notices either through Automated Dispatches or Alternative Dispatches during any Settlement Interval or Settlement Period, then as an exclusive Item 5
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31 remedy, the time period corresponding to such Settlement Interval or Settlement Period shall be deemed unavailable for purposes of calculating the Monthly Capacity Availability.

4.9 Energy Management.
(a) Charging Generally. Upon receipt of a valid Charging Notice, Seller shall take all action necessary to deliver the Charging Energy to the Facility from the Delivery Point.

Seller shall maintain, repair or replace equipment in Seller’s possession or control used to deliver the Charging Energy from the Delivery Point to the Facility. Except as otherwise expressly set forth in this Agreement, Buyer shall be responsible for paying all costs and charges of delivering the Charging Energy to the Delivery Point, including all CAISO costs and charges associated with Charging Energy.
(b) Charging Notices. Buyer shall have the right to charge the Facility seven (7) days per week and twenty-four (24) hours per day (including holidays) during the Delivery Term, by causing Charging Notices to be issued, subject to the requirements and limitations set forth in this Agreement, including the Operating Restrictions. Each Charging Notice issued in accordance with this Agreement shall be effective unless and until Buyer’s SC or CAISO modifies such Charging Notice by providing Seller with an updated Charging Notice. Buyer shall be responsible for issuing all Charging Notices necessary or required in connection with the Must Offer Obligations.
(c) No Unauthorized Charging. Seller shall not charge the Facility during the Delivery Term other than pursuant to a valid Charging Notice (it being understood that Seller may adjust a Charging Notice to the extent necessary to maintain compliance with the Operating Restrictions), or in connection with a Seller Initiated Test (including Facility maintenance or a Capacity Test), or pursuant to a notice from the Transmission Provider or Governmental Authority.

If, during the Delivery Term, Seller charges the Facility (i) to a Storage Level greater than the Storage Level provided for in a Charging Notice, or (ii) in violation of the first sentence of this Section 4.9(c), then (i) Seller shall pay to Buyer all Energy costs associated with such charging of the Facility, and (ii) Buyer shall be entitled to discharge such Energy and shall be entitled to all of the benefits (including Product) associated with such discharge. (d) Discharging Notices. Buyer shall have the right to discharge the Facility seven (7) days per week and twenty-four (24) hours per day (including holidays) during the Delivery Term, by causing Discharging Notices to be issued. Each Discharging Notice issued in accordance with this Agreement shall be effective unless and until Buyer’s SC or the CAISO modifies such Discharging Notice by providing the Facility with an updated Discharging Notice.

Buyer shall be responsible for issuing all Discharging Notices necessary or required in connection with the Must Offer Obligations and all CAISO charges and penalties for failing to comply with the Must Offer Obligation.
(e) No Unauthorized Discharging. Seller shall not discharge the Facility during the Delivery Term other than pursuant to a valid Discharging Notice (it being understood that Seller may adjust a Discharging Notice to the extent necessary to maintain compliance with the Operating Restrictions), or in connection with a Seller Initiated Test (including Facility Item 5
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32 maintenance or a Storage Capacity Test), or pursuant to a notice from the Transmission Provider or Governmental Authority.
(f) Unauthorized Charges and Discharges. If Seller or any third party charges, discharges or otherwise uses the Facility other than as permitted hereunder, or as is expressly addressed in this Section 4.9, it shall be a breach by Seller and Seller shall hold Buyer harmless from, and indemnify Buyer against, all actual costs or losses associated therewith, and be responsible to Buyer for any damages arising therefrom, and, if Seller fails to implement procedures reasonably acceptable to Buyer to prevent any further occurrences of the same, then the failure to implement such procedures shall be an Event of Default under Article 11. (g) CAISO Dispatches. During the Delivery Term, CAISO Dispatches shall have priority over any Charging Notice or Discharging Notice issued by Buyer’s SC, and Seller shall have no liability for violation of this Section 4.9 or any Charging Notice or Discharging Notice if and to the extent such violation is caused by Seller’s compliance with any CAISO Dispatch. During any time interval during the Delivery Term in which the Facility is capable of responding to a CAISO Dispatch, but the Facility deviates from a CAISO Dispatch or Seller negligently or intentionally fails to accurately communicate to Buyer the Facility’s availability, Seller shall be responsible for all CAISO charges and penalties resulting from such deviations (in addition to any Buyer remedy related to overcharging of the Facility as set forth in Section 4.9(c)). (h) Pre-Commercial Operation Date Period, etc. Prior to the Commercial Operation Date, Buyer shall have no rights to issue or cause to be issued Charging Notices or Discharging Notices, and Seller shall have exclusive rights to charge and discharge the Facility. (i) Curtailments. Notwithstanding anything in this Agreement to the contrary, during any Settlement Interval, Curtailment Orders applicable to such Settlement Interval shall have priority over any Dispatch Notices applicable to such Settlement Interval, and Seller shall have no liability for violation of this Agreement or any Dispatch Notice if and to the extent such violation is caused by Seller’s compliance with any Curtailment Order or other instruction or direction from a Governmental Authority or the Transmission Provider. Buyer shall have the right, but not the obligation, to provide Seller with updated Dispatch Notices during any Curtailment Order consistent with the Operating Restrictions.
(j) Station Use. Notwithstanding anything to the contrary in this Agreement, the Parties acknowledge (i) Seller is responsible for providing all Energy to serve Station Use(including paying the cost of any Energy used to serve Station Use during periods in which the Storage Facility is not charging or discharging pursuant to a Charging Notice or Discharging Notice), (ii) Energy supplied from Charging Energy or Discharging Energy during periods in which the Storage Facility is charging or discharging pursuant to a Charging Notice or Discharging Notice shall not be considered Station Use, (iii) Station Use may be supplied over the same circuit as Charging Energy and Discharging Energy, and (iv) Seller shall indemnify and hold harmless Buyer from any and all costs, penalties or charges for Energy supplied for Station Use by any means other than retail service from the applicable utility, and shall take any additional measures to ensure Station Use (other than that supplied from Charging Energy or Discharging Energy as provided in clause (ii) or over the same circuit as Charging Energy and Discharging Energy as Item 5
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33 provided in clause (iii)) is supplied by the applicable utility’s retail service if necessary to avoid any such costs, penalties or charges.

4.10 Capacity Availability Notice.
(a) No less than thirty (30) days before the beginning of Commercial Operation, and thereafter ten (10) Business Days before the beginning of each month during the Delivery Term, Seller shall provide to Buyer and the SC (if applicable) a non-binding forecast of the hourly expected Available Capacity for each day of the following month in a form substantially similar to Exhibit F (“Monthly Forecast”).
(b) During the Delivery Term, no later than two (2) Business Days before each schedule day for the Day-Ahead Market in accordance with CAISO scheduling practices, Seller shall provide Buyer and the SC (if applicable) with an hourly schedule of the Available Capacity that the Facility is expected to have for each hour of such schedule day (the “Availability Notice”).

Seller shall provide Availability Notices (including updated Availability Notices) using the form attached in Exhibit G, or other form as reasonably requested by Buyer, by (in order of preference) electronic mail or telephonically to Buyer personnel or its Scheduling Coordinator designated to receive such communications.
(c) Seller shall notify Buyer and the SC (if applicable) immediately with an updated Monthly Forecast and Availability Notice, as applicable, if the Available Capacity of the Facility changes or is expected to change after Buyer’s receipt of a Monthly Forecast or Availability Notice. Seller shall accommodate Buyer’s reasonable requests for changes in the time of delivery of Availability Notices.

4.11 [Reserved].

4.12 Outages
(a) Planned Outages.
(i) No later than January 15, April 15, July 15 and October 15 of each Contract Year, and at least sixty (60) days prior to the Commercial Operation Date, Seller shall submit to Buyer Seller’s schedule of proposed Planned Outages (“Outage Schedule”) for the following twelve (12)-month period in a form reasonably agreed to by Buyer. Within twenty (20) Business Days after its receipt of an Outage Schedule, Buyer shall give Notice to Seller of any reasonable request for changes to the Outage Schedule, and Seller shall, consistent with Prudent Operating Practices, accommodate Buyer’s requests regarding the timing of any Planned Outage.

Seller shall deliver to Buyer the final Outage Schedule no later than ten (10) days after receiving Buyer’s comments. Seller shall be permitted to reduce deliveries of applicable Products during any period of such Planned Outages.
(ii) If reasonably required in accordance with Prudent Operating Practices, Seller shall have the right, on no less than ninety (90) days advance Notice to Buyer, to propose changes to the Outage Schedule developed pursuant to Section 4.12(a)(i). Buyer may provide comments no later than ten (10) days after receiving Seller’s Notice of proposed changes to the Outage Schedule and shall permit any changes if doing so would not have a material adverse Item 5
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Item 5
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impact on Buyer and Seller agrees to reimburse Buyer for any costs or charges associated with such changes.

No Planned Outages During Summer Months. Except as scheduled by the Parties under Section 4.12(a), during the months of June through September, Seller shall not schedule any non-emergency maintenance that reducesthe energy storage capability of the Facility bv more than the lesser
(b)
t*
^
v.
^
JPHuiilesTuTsuch outage is, required to avoid damage
to the Facility, (ii) such maintenance is necessary to maintain equipment warranties and cannot be scheduled outside of the months of June through September, (iii) such outage is required in accordance with Prudent Operating Practices, or (iv) the Parties agree otherwise in writing. In the event that Seller has a previously Planned Outage that becomes coincident with a System Emergency, Seller shall make all reasonable efforts to reschedule such Planned Outage. (c) Planned Outage Timing. To the extent commercially reasonable, Seller shall schedule maintenance outages (i) within a single month, rather than across multiple months, (ii) during periods in which CAISO does not require resource substitution or replacement, and (iii) otherwise in a manner to avoid reductions in the Resource Adequacy Benefits available from the Facility to Buyer.

Notice of Unplanned Outages Seller shall notify Buyer by telephoning Buyer’s Scheduling Coordinator no later than thirty (30) minutes following the occurrence of an Unplanned Outage, or if Seller has knowledge that an Unplanned Outage will occur, within thirty (30) minutes of determining that such Unplanned Outage will occur. Seller shall relay outage information to Buyer as required by the CAISO Tariff. Seller shall communicate to Buyer the estimated time of return of the Facility as soon as practical after Seller has knowledge thereof. (d)
(e) Inspection. In the event of an Unplanned Outage, Buyer shall have the option to inspect the Facility and all records relating thereto on any Business Day and at a reasonable time and Seller shall reasonably cooperate with Buyer dining any such inspection.

Buyer shall comply with Seller’s safety and security rules and instructions during any inspection and shall not interfere with work on or operation of the Facility. (f) Reports of Outages. Seller shall promptly prepare and provide to Buyer, all reports of Unplanned Outages or Planned Outages that Buyer may reasonably require for the purpose of enabling Buyer to comply with CAISO requirements or any applicable Laws. Seller shall also report all Unplanned Outages or Planned Outages in the Daily Operating Report.

ARTICLE 5

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

5.1 34
35 after its delivery to Buyer at the time and place contemplated under this Agreement (other than withholding or other Taxes imposed on Seller’s income, revenue, receipts or employees) or on Charging Energy prior to its delivery to Seller. If a Party is required to remit or pay Taxes that are the other Party’s responsibility hereunder, such Party shall promptly pay the Taxes due and then seek and receive reimbursement from the other for such Taxes. In the event any sale of Product hereunder is exempt from or not subject to any particular Tax, Buyer shall provide Seller with all necessary documentation to evidence such exemption or exclusion within thirty (30) days after the date Buyer makes such claim. Buyer shall indemnify, defend, and hold Seller harmless from any liability with respect to Taxes for which Buyer is responsible hereunder and from which Buyer claims it is exempt.

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

5.3 Environmental Costs. Seller shall be solely responsible for:
(a) All Environmental Costs;
(b) 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 Delivery Term, but expressly excluding any taxes, charges or fees related to Greenhouse Gases imposed on Charging Energy or Discharging Energy;
(c) Seller’s obligations listed under “Compliance Obligation” in the GHG Regulations, and
(d) All other costs associated with the implementation and regulation of Greenhouse Gas emissions (whether in accordance with the California Global Warming Solutions Act of 2006, Assembly Bill 32 (2006) and the regulations promulgated thereunder, including the GHG Regulations, or any other federal, state or local legislation to offset or reduce any Greenhouse Gas emissions implemented and regulated by a Governmental Authority) with respect to the Facility and/or Seller.

ARTICLE 6

MAINTENANCE AND REPAIR OF THE FACILITY

6.1 Maintenance of the Facility.
(a) Seller shall construct, operate, and maintain the Facility so that Buyer may dispatch the Facility within the operating parameters of the Operating Restrictions. Nothing herein shall limit Seller’s right replace or augment existing batteries and other equipment to maintain the capacity of the Facility.

Item 5
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36 (b) Seller shall, as between Seller and Buyer, be solely responsible for the operation, inspection, maintenance and repair of the Facility, and any portion thereof, in accordance with applicable Law and Prudent Operating Practices. Seller shall maintain and deliver maintenance and repair records of the Facility to Buyer’s scheduling representative upon request. (c) Seller shall promptly make all necessary repairs to the Facility, and any portion thereof, and take all actions necessary in order to provide the Product to Buyer in accordance with the terms of this Agreement (and, at a minimum, the Performance Guarantees).

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

6.3 Shared Facilities. The Parties acknowledge and agree that certain of the Shared Facilities and Interconnection Facilities, and Seller’s rights and obligations under the Interconnection Agreement, may be subject to certain shared facilities and/or co-tenancy agreements to be entered into among Seller, the Transmission Provider, Seller’s Affiliates, and/or third parties. 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 charge or discharge the Facility up to the Dedicated Interconnection 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 minus the Dedicated Interconnection Capacity.

ARTICLE 7

METERING

7.1 Metering. Seller shall measure the amount of Charging Energy and Discharging Energy using the Facility Meter, which shall be subject to adjustment in accordance with applicable CAISO meter requirements and Prudent Operating Practices, including to account for Electrical Losses. Seller shall separately meter all Station Use except to the extent drawn from Charging Energy or Discharging Energy. The Facility Meter shall be operated pursuant to applicable CAISO-approved calculation methodologies and maintained at Seller’s cost. Each meter shall be kept under seal, such seals to be broken only when the Facility Meters are to be tested, adjusted, modified or relocated. In the event Seller breaks a seal, Seller shall notify Buyer as soon as practicable. In addition, Seller hereby agrees to provide all Facility Meter data to Buyer in a form reasonably acceptable to Buyer, and consents to Buyer obtaining from CAISO the Item 5
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37 CAISO meter data directly relating to the 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 Market Results Interface - Settlements (MRI-S) web and/or directly from the CAISO meter(s) at the Facility.

7.2 Meter Verification. If Seller or Buyer have reason to believe there may be a Facility Meter malfunction, Seller shall test the Facility 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 Facility 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 Facility Meter inaccuracy commenced (if such evidence exists, then such date will be used to adjust prior invoices), then the invoices covering the period of time since the last Facility Meter test shall be adjusted for the amount of the inaccuracy on the assumption that the inaccuracy persisted during one-half of such period if such adjustments are accepted by CAISO; provided, such period may not exceed twelve (12) months.

ARTICLE 8
INVOICING AND PAYMENT; CREDIT

8.1 Invoicing. Seller shall use commercially reasonable efforts to deliver an invoice to Buyer for Product no later than the tenth (10th) day of each month for the previous calendar month.

Each invoice shall reflect (a) records of metered data, including, to the extent the available, (i) CAISO metering and transaction data reflecting the amount of Product delivered by the Facility for any Settlement Period during the preceding month, including the amount of Charging Energy and the amount of Discharging Energy, in each case as read by the Facility Meter, and the amount of Replacement RA delivered to Buyer (if any) and (ii) Seller’s records of metered data, including data showing a calculation of the Monthly Capacity Payment and other relevant data for the prior month; and (b) be in a format reasonably specified by Buyer, covering the Product provided in the preceding month determined in accordance with the applicable provisions of this Agreement.

Beginning on the Commercial Operation Date, 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; provided, however, that the Parties acknowledge and agree that CAISO metering and transaction data showing the amount of Product delivered by the Facility for any Settlement Period during the prior month may not be available or be final at the time each monthly invoice is delivered pursuant to this Section 8.1 and that the monthly invoice will be based on such data as are available at the time. When CAISO metering and transaction data showing the amount of Product delivered by the Facility for any Settlement Period during the applicable month, including the amount of Charging Energy and the amount of Discharging Energy, in each case as read by the Facility Meter, and the amount of Replacement RA delivered to Buyer (if any) becomes available, Seller will true up such invoices to reflect any differences between Seller’s records and the data received from CAISO, and an appropriate credit or charge will be added to the next monthly invoice.

8.2 Payment. Buyer shall make payment to Seller of Monthly Capacity Payments for Product (and any other amounts due) by wire transfer or ACH payment to the bank account Item 5
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38 provided on each monthly invoice. Buyer shall pay undisputed invoice amounts within (30) days of Buyer’s receipt of Seller’s invoices; provided, if such due date falls on a weekend or legal holiday, such due date shall be the next Business Day. Payments made after the due date will be considered late and will bear interest on the unpaid balance. If the amount due is not paid on or before the due date or if any other payment that is due and owing from one Party to another is not paid on or before its applicable due date, a late payment charge shall be applied to the unpaid balance and shall be added to the next billing statement. Such late payment charge shall be calculated based on an annual Interest Rate equal to the prime rate published on the date of the invoice in The Wall Street Journal (or, if The Wall Street Journal is not published on that day, the next succeeding date of publication), plus two percent (2%) (the “Interest Rate”). If the due date occurs on a day that is not a Business Day, the late payment charge shall begin to accrue on the next succeeding Business Day.

8.3 Books and Records. To facilitate payment and verification, each Party shall maintain all books and records necessary for billing and payments, including copies of all invoices under this Agreement, for a period of at least two (2) years or as otherwise required by Law. Upon fifteen (15) days’ Notice to the other Party, either Party shall be granted reasonable access to the accounting books and records within the possession or control of the other Party pertaining to all invoices generated pursuant to this Agreement. Seller acknowledges that in accordance with California Government Code Section 8546.7, Seller may be subject to audit by the California State Auditor with regard to Seller’s performance of this Agreement because the compensation under this Agreement exceeds $10,000.

8.4 Payment Adjustments; Billing Errors. Payment adjustments shall be made if Buyer or Seller discovers there have been good faith inaccuracies in invoicing that are not otherwise disputed under Section 8.5 or an adjustment to an amount previously invoiced or paid is required due to a correction of data by the CAISO, or there is determined to have been a Facility Meter inaccuracy sufficient to require a payment adjustment. If the required adjustment is in favor of Buyer, Buyer’s next monthly payment shall be credited in an amount equal to the adjustment.

If the required adjustment is in favor of Seller, Seller shall add the adjustment amount to Buyer’s next monthly invoice. Adjustments in favor of either Buyer or Seller shall bear interest, until settled in full, in accordance with Section 8.2, accruing from the date on which the adjusted amount should have been due.

8.5 Billing Disputes. A Party may, in good faith, dispute the correctness of any invoice or any adjustment to an invoice rendered under this Agreement or adjust any invoice for any arithmetic or computational error within twelve (12) months of the date the invoice, or adjustment to an invoice, was rendered. In the event an invoice or portion thereof, or any other claim or adjustment arising hereunder, is disputed, payment of the undisputed portion of the invoice shall be required to be made when due. Any invoice dispute or invoice adjustment shall be in writing and shall state the basis for the dispute or adjustment. Payment of the disputed amount shall not be required until the dispute is resolved. Upon resolution of the dispute, any required payment shall be made within five (5) Business Days of such resolution along with interest accrued at the Interest Rate from and including the original due date to but excluding the date paid. Inadvertent overpayments shall be returned via adjustments in accordance with Section 8.4. Any dispute with respect to an invoice is waived if the other Party is not notified in accordance with this Section 8.5 within twelve (12) months after the invoice is rendered or subsequently adjusted, except to the Item 5
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39 extent any misinformation was from a third party not affiliated with any Party and such third party corrects its information after the twelve-month period. If an invoice is not rendered within twelve (12) months after the close of the month during which performance occurred, the right to payment for such performance is waived.

8.6 Netting of Payments. The Parties hereby agree that they shall discharge mutual debts and payment obligations due and owing to each other on the same date through netting, in which case all amounts owed by each Party to the other Party for the purchase and sale of Product during the monthly billing period under this Agreement or otherwise arising out of this Agreement, including any related damages calculated pursuant to Exhibits B and P, interest, and payments or credits, shall be netted so that only the excess amount remaining due shall be paid by the Party who owes it.

8.7 Seller’s Development Security. To secure its obligations under this Agreement, Seller shall deliver the Development Security to Buyer within thirty (30) days after receipt of Project Participant Approval. Seller shall maintain the Development Security in full force and effect. Within five (5) Business Days following any draw by Buyer on the Development Security, Seller shall replenish the amount drawn such that the Development Security is restored to the applicable amount. Upon the earlier of (a) Seller’s delivery of the Performance Security, or (b) sixty (60) days after termination of this Agreement, Buyer shall return the Development Security to Seller, less the amounts drawn in accordance with this Agreement.

8.8 Seller’s Performance Security. To secure its obligations under this Agreement, Seller shall deliver Performance Security to Buyer on or before the Commercial Operation Date.

Seller shall maintain the Performance Security in full force and effect, and Seller shall within five (5) Business Days after any draw thereon replenish the Performance Security in the event Buyer collects or draws down any portion of the Performance Security for any reason permitted under this Agreement other than to satisfy a Termination Payment, until the following have occurred: (a) the Delivery Term has expired or terminated early; and (b) all payment obligations of Seller due and payable under this Agreement, including compensation for penalties, Termination Payment, indemnification payments or other damages are paid in full (whether directly or indirectly such as through set-off or netting). Following the occurrence of both events, Buyer shall promptly return to Seller the unused portion of the Performance Security.

8.9 First Priority Security Interest in Cash or Cash Equivalent Collateral. To secure its obligations under this Agreement, and until released as provided herein, Seller hereby grants to Buyer a present and continuing first-priority security interest (“Security Interest”) in, and lien on (and right to net against), and assignment of the Development Security, Performance Security, any other cash collateral and cash equivalent collateral posted pursuant to Sections 8.7 and 8.8 and any and all interest thereon or proceeds resulting therefrom or from the liquidation thereof, whether now or hereafter held by, on behalf of, or for the benefit of Buyer, and Seller agrees to take all action as Buyer reasonably requires in order to perfect Buyer’s Security Interest in, and lien on (and right to net against), such collateral and any and all proceeds resulting therefrom or from the liquidation thereof.

Upon or any time after the occurrence of an Event of Default caused by Seller, an Early Termination Date resulting from an Event of Default caused by Seller, or an occasion provided for Item 5
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40 in this Agreement where Buyer is authorized to retain all or a portion of the Development Security or Performance Security, Buyer may do any one or more of the following (in each case subject to the final sentence of this Section 8.9):
(a) Exercise any of its rights and remedies with respect to the Development Security and Performance Security, including any such rights and remedies under Law then in effect;
(b) Draw on any outstanding Letter of Credit issued for its benefit and retain any cash held by Buyer as Development Security or Performance Security; and (c) Liquidate all Development Security or Performance Security (as applicable) then held by or for the benefit of Buyer free from any claim or right of any nature whatsoever of Seller, including any equity or right of purchase or redemption by Seller.

Buyer shall apply the proceeds of the collateral realized upon the exercise of any such rights or remedies to reduce Seller’s obligations under this Agreement (Seller remains liable for any amounts owing to Buyer after such application), subject to Buyer’s obligation to return any surplus proceeds remaining after such obligations are satisfied in full.

8.10 Buyer Credit Arrangements.
(a) To secure its obligations under this Agreement, Buyer shall deliver to Seller, within ninety (90) days after the Effective Date, Buyer Liability Pass Through Agreements from the Project Participants with Liability Shares as set forth on Exhibit V. Seller shall countersign each Buyer Liability Pass Through Agreement within ten (10) days of receipt of Buyer’s delivery of each such Buyer Liability Pass Through Agreement executed by Buyer and the applicable Project Participant; provided that no delay in countersigning any such Buyer Liability Pass Through Agreement shall affect Seller’s, Buyer’s or the Project Participant’s rights or obligations thereunder. Buyer shall maintain such Buyer Liability Pass Through Agreements in full force and effect until both of the following have occurred: (a) the Delivery Term has expired or terminated early; and (b) all payment obligations of Buyer due and payable under this Agreement are paid in full (whether directly or indirectly such as through set-off or netting). Buyer may propose amendments to Exhibit V, including with respect to the identity of Project Participants and the amount of each Project Participant’s Liability Share. Seller shall have ten (10) Business Days to evaluate any such proposed amendments to Exhibit V in its sole but good faith discretion. If Seller approves such proposed amendments to Exhibit V, Buyer shall have thirty (30) days to provide Seller with replacement Buyer Liability Pass Through Agreements with Liability Shares executed by Buyer and the applicable Project Participants that incorporate the Liability Shares set forth in the amended Exhibit V. Seller shall countersign each such Buyer Liability Pass Through Agreement executed by Buyer and the applicable Project Participant within ten (10) Business Days after Buyer’s delivery of such Buyer Liability Pass Through Agreements to Seller; provided that no delay in countersigning any such Buyer Liability Pass Through Agreement shall affect Seller’s, Buyer’s or the Project Participant’s rights or obligations thereunder. (b) Within thirty (30) days following a Step-Up Event, (A) Buyer shall provide Seller with replacement Buyer Liability Pass Through Agreements from all Compliant Project Item 5
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Item 5
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Participants executed by Buyer and the applicable Compliant Project Participants that reflect each Compliant Project Participant’s Revised Liability Share following such Step Up Event, and, (B) Exhibit V will be amended to reflect the Compliant Project Participants’ Revised Liability Shares following such Step Up Event. Seller shall countersign each such Buyer Liability Pass Through Agreement executed by Buyer and the applicable Compliant Project Participant within ten (10) Business Days after Buyer’s delivery of such Buyer Liability Pass Through Agreements to Seller; provided that no delay in countersigning or failure to countersign any such Buyer Liability Pass Through Agreement shall affect Buyer’s or the Project Participant’s rights or obligations 1 Mowing
the occurrence of a Step-Up Event, Seller and Buyer will ament >it V to set forth the Revised Liability Shares of the remaining Project Participants.

ARTICLE 9

NOTICES
Addresses for the Delivery of Notices. Any Notice required, permitted, or contemplated hereimder shall be in writing, shall be addressed to the Party to be notified at the address set forth in Exhibit N or at such other address or addresses as a Party may designate for itself from time to time by Notice hereunder.

9.1 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 ofsuch fees, the next Business Day after the same is delivered by the sending Party to such carrier; (c) if sent by electronic communication (including electronic mail or other electronic means) at the time indicated by the time stamp upon delivery and, if after 5 pm, on the next Business Day; or (d) if delivered in person, upon receipt by the receiving Party. Notwithstanding the foregoing, Notices of outages or other scheduling or dispatch information or requests, may be sent by electronic communication and shall be considered delivered upon successful completion of such transmission.

9.2 41
42 ARTICLE 10

FORCE MAJEURE

10.1 Definition.
(a) “Force Majeure Event” means any act or event that delays or prevents a Party from timely performing all or a portion of its obligations under this Agreement or from complying with all or a portion of the conditions under this Agreement if such act or event, despite the exercise of commercially 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 or pandemic (excluding impacts of the disease designated COVID-19 or the related virus designated SARS-CoV-2 impacts actually known by the Party claiming the Force Majeure Event as of the Effective Date); landslide; mudslide; sabotage; terrorism; earthquake; or other cataclysmic events; an act of public enemy; war; blockade; civil insurrection; riot; civil disturbance; or strikes or other labor difficulties caused or suffered by a Party or any third party except as set forth below. (c) Notwithstanding the foregoing, the term “Force Majeure Event” does not include (i) economic conditions or changes in Law that render a Party’s performance of this Agreement at the Contract 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 Product at a lower price, or Seller’s ability to sell the Product, or any component thereof, at a higher price, than under this Agreement); (ii) Seller’s inability to obtain permits or approvals of any type for the construction, operation, or maintenance of the Facility, except to the extent such inability is caused by a Force Majeure Event; (iii) the inability of a Party to make payments when due under this Agreement, unless the cause of such inability is an event that would otherwise constitute a Force Majeure Event as described above that disables physical or electronic facilities necessary to transfer funds to the payee Party; (iv) a Curtailment Order, except to the extent such Curtailment Order 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, including the lack of wind, sun or other fuel source of an inherently intermittent nature, except to the extent such inability is caused by a Force Majeure Event; (vi) a strike, work stoppage or labor dispute limited only to any one or more of Seller, Seller’s Affiliates, Seller’s contractors, their subcontractors thereof or any other third party employed by Seller to work on the Facility; (vii) any equipment failure except if such equipment failure is caused by a Force Majeure Event; (viii) events otherwise constituting a Force Majeure Event that prevents Seller from achieving Construction Start or Commercial Operation of the Facility, except to the extent expressly permitted as an extension under this Agreement; or (ix) any action or inaction by any third party, including Transmission Provider, that delays or prevents the approval, construction or placement Item 5
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43 in service of any Interconnection Facilities or Network Upgrades, except to the extent caused by a Force Majeure Event.

10.2 No Liability If a Force Majeure Event Occurs. Except as provided in Section 4 of Exhibit B, neither Seller nor Buyer shall be liable to the other Party in the event it is prevented from performing its obligations hereunder in whole or in part due to a Force Majeure Event. The Party rendered unable to fulfill any obligation by reason of a Force Majeure Event shall take reasonable actions necessary to remove such inability with due speed and diligence. Nothing herein shall be construed as permitting that Party to continue to fail to perform after said cause has been removed. The obligation to use due speed and diligence shall not be interpreted to require resolution of labor disputes by acceding to demands of the opposition when such course is inadvisable in the discretion of the Party having such difficulty. Neither Party shall be considered in breach or default of this Agreement if and to the extent that any failure or delay in the Party’s performance of one or more of its obligations hereunder is caused by a Force Majeure Event.

Notwithstanding the foregoing, the occurrence and continuation of a Force Majeure Event shall not (a) suspend or excuse the obligation of a Party to make any payments due hereunder except as provided above, (b) suspend or excuse the obligation of Seller to achieve the Guaranteed Construction Start Date or the Guaranteed Commercial Operation Date beyond the extensions provided in Section 4 of Exhibit B, or (c) limit Buyer’s right to declare an Event of Default pursuant to Section 11.1(b)(ii) after all applicable extensions of the Guaranteed Construction Start Date and the Guaranteed Commercial Operation Date and receive a Damage Payment upon exercise of Buyer’s remedies pursuant to Section 11.2.

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) promptly notify the other Party in writing of the nature, cause, estimated date of commencement thereof, and the anticipated extent of any delay or interruption in performance, and (b) promptly 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 after the Commercial Operation Date that has caused either Party to be wholly or substantially unable to perform its obligations hereunder, and the impacted Party has claimed and received relief from performance of its obligations for a consecutive twelve (12) month period, then the non-claiming Party may terminate this Agreement upon Notice to the other Party. Upon any such termination, neither Party shall have any further liability to the other Party, save and except for those obligations specified in Section 2.1(c), and Buyer shall promptly return to Seller any Performance Security then held by Buyer, less any amounts drawn in accordance with this Agreement.

ARTICLE 11
DEFAULTS; REMEDIES; TERMINATION

11.1 Events of Default. An “Event of Default” shall mean, Item 5
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44 (a) with respect to a Party (the “Defaulting Party”) that is subject to the Event of Default the occurrence of any of the following:
(i) the failure by such Party to make, when due, any payment required pursuant to this Agreement and such failure is not remedied within ten (10) Business Days after Notice thereof;
(ii) any representation or warranty made by such Party herein is false or misleading in any material respect when made or when deemed made or repeated, and such default is not remedied within thirty (30) days after Notice thereof (or such longer additional period, not to exceed an additional sixty (60) days, if the Defaulting Party is unable to remedy such default within such initial thirty (30)-day period despite exercising commercially reasonable efforts); (iii) the failure by such Party to perform any material covenant or obligation set forth in this Agreement (except to the extent constituting a separate Event of Default set forth in this Section 11.1; and except for (A) failure to provide Capacity Attributes, the exclusive remedies for which are set forth in Section 3.5, (B) failures related to the Monthly Capacity Availability that do not trigger the provisions of Section 11.1(b)(iii), the exclusive remedies for which are set forth in Exhibit C and Exhibit P, and (C) failure to maintain the Guaranteed Efficiency Rate, the exclusive remedies for which are set forth in Exhibit C), and such failure is not remedied within thirty (30) days after Notice thereof (or such longer additional period, not to exceed an additional ninety (90) days, if the Defaulting Party is unable to remedy such default within such initial thirty (30)-day period despite exercising commercially reasonable efforts);
(iv) such Party becomes Bankrupt;
(v) such Party assigns this Agreement or any of its rights hereunder other than in compliance with Article 14, if applicable; or (vi) such Party consolidates or amalgamates with, or merges with or into, or transfers all or substantially all of its assets to, another entity and, at the time of such consolidation, amalgamation, merger or transfer, the resulting, surviving or transferee entity fails to assume all the obligations of such Party under this Agreement to which it or its predecessor was a party by operation of Law or pursuant to an agreement reasonably satisfactory to the other Party. (b) with respect to Seller as the Defaulting Party, the occurrence of any of the following:
(i) if at any time, Seller delivers or attempts to deliver Energy to the Delivery Point for sale under this Agreement that was not discharged by the Facility; (ii) the failure by Seller to (A) achieve Construction Start on or before the Guaranteed Construction Start Date, as such date may be extended by Seller’s payment of Daily Delay Damages pursuant to Section 1(b) of Exhibit B and/or a Development Cure Period pursuant to Section 4 of Exhibit B, or (B) achieve Commercial Operation on or before the Guaranteed Commercial Operation Date, as such date may be extended Item 5
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45 by Seller’s payment of Commercial Operation Delay Damages pursuant to Section 2(b) of Exhibit B and/or a Development Cure Period pursuant to Section 4 of Exhibit B; (iii) if, in any Contract Year, the simple average of the Monthly Capacity Availability calculations for such Contract Year is not equal to at least of the Guaranteed Availability, and Seller fails to (x) deliver to Buyer within ten (10) Business Days after Notice from Buyer a plan or report developed by Seller that describes the cause of the failure of the simple average of the Monthly Capacity Availability calculations for such Contract Year to equal at least of the Guaranteed Availability, and the actions that Seller has taken, is taking, or proposes to take in an effort to cure such condition along with the written confirmation of a Licensed Professional Engineer that such plan or report is in accordance with Prudent Operating Practices and capable of cure within a reasonable period of time, not to exceed (“Cure Plan”) and (y) complete such Cure Plan in all material respects as set forth therein, including within the timeframe set forth therein; (iv) failure by Seller to satisfy the collateral requirements pursuant to Sections 8.7 or 8.8 within five (5) Business Days after Notice from Buyer, including the failure to replenish the Performance Security amount in accordance with this Agreement in the event Buyer draws against it for any reason other than to satisfy a Termination Payment; (v) with respect to any outstanding Letter of Credit provided for the benefit of Buyer that is not then required under this Agreement to be canceled or returned, the failure by Seller to provide for the benefit of Buyer either (1) cash, or (2) a Letter of Credit from a different issuer meeting the criteria set forth in the definition of Letter of Credit, in each case, in the amount required hereunder within ten (10) Business Days (thirty (30) days in the case of subsection (A)) after Seller receives Notice of the occurrence of any of the following events:
(A) the issuer of the outstanding Letter of Credit shall fail to maintain a Credit Rating of at least A- by S&P or A3 by Moody’s; (B) the issuer of such Letter of Credit becomes Bankrupt; (C) the issuer of the outstanding Letter of Credit shall fail to comply with or perform its obligations under such Letter of Credit and such failure shall be continuing after the lapse of any applicable grace period permitted under such Letter of Credit;
(D) the issuer of the outstanding Letter of Credit shall fail to honor a properly documented request to draw on such Letter of Credit; (E) the issuer of the outstanding Letter of Credit shall disaffirm, disclaim, repudiate or reject, in whole or in part, or challenge the validity of, such Letter of Credit;
(F) such Letter of Credit fails or ceases to be in full force and effect at any time; or
Item 5
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Item 5
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Seller shall fail to renew or cause the renewal of each outstanding Letter of Credit on a timely basis as provided in the relevant Letter of Credit and as provided in accordance with this Agreement, and in no event less than sixty (60) days prior to the expiration of the outstanding Letter of Credit.
(G)
Remedies; Declaration of Early Termination Date. If an Event of Default with respect to a Defaulting Party shall have occurred and be continuing, the other Party ( '
“Non-Defaulting Party ’) shall have the following rights:
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 terminatesthis Agreement (the “Terminated Transaction”) and endsthe Delivery Term effective as of the Early Termination Date;
(a)
to accelerate all amounts owing between the Parties, and to collect as liquidated damages (i) the Damage Payment, or (ii) the Termination Payment, as applicable, in each case calculated in accordance with Section 11.3 below; (b)
(c) to withhold any payments due to the Defaulting Party under this Agreement; (d) to suspend performance; and
(e) to exercise any other right or remedy available at law or in equity, including specific performance or injunctive relief, except to the extent such remedies are expressly limited under this Agreement;
provided, payment by the Defaulting Party of the Damage Payment or Termination Payment, as applicable, shall constitute liquidated damages and the Non-Defaulting Party’ssole and exclusive remedy for any Terminated Transaction and the Event of Default related thereto. 46 Item 5
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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.

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).
(a)
(i)
" • ,
‘
' '
r '
*
*
HrhePntie- agiee tli.rit Buyer '
s
damagesin 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 a Damage Payment shall be owed to Seller and shall equal (A) the sum of (i) Seller’s Losses, including Seller’s lost revenue imder this Agreement resulting from a Buyer Default, which shall not be considered to include consequential, incidental, punitive, exemplary, indirect, or business interruption damages for purposes of this Agreement, plus (ii) without duplication of any costs or expenses covered by preceding clause, all actual, documented and verifiable Costs that have been actually incurred, or become payable, by Seller arising out ofthe termination of this Agreement, less(B) Seller’s Gains.

There will be no amount owed to Buyer. The Parties agree that Seller’s damages in the event of an Early Termination Date prior to the Commercial Operation Date caused by Buyer’s default would be difficult or impossible to determine and that the damages set forth in this Section 11,3(a)(ii) are a reasonable approximation of Seller’s harm or loss.
(b) Termination Payment On or After the Commercial Operation Date. The payment owed by the Defaulting Party to the Non-Defaulting Party for a Terminated Transaction occurring after the Commercial Operation Date (“Termination Payment ”)shall be the aggregate of all Settlement Amounts plus any and all other amounts due to or from the Non-Defaulting Party (as of the Early Termination Date) netted into a single amount. The Non-Defaulting Party shall calculate, in a commercially reasonable manner, a Settlement Amount for the Terminated Transaction as of the Early Termination Date. Third parties supplying information for purposes of the calculation of Gains or Losses may include, without limitation, dealers in the relevant markets, end-users of the relevant product, information vendors and other sources of market information.

Without prejudice to the Non-Defaulting Party’s duty to mitigate, the Non-Defaulting Party shall not have to enter into replacement transactionsto 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 47 Item 5
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Terminated Transaction but shall not otherwise act to limit any of the Non-Defaulting Party’s rights or remedies if the Non-Defaulting Party does not elect a Terminated Transaction as its remedy for an Event of Default by the Defaulting Party.

11.4 Notice of Payment of Termination Payment or Damage Payment. As soon as practicable after a Terminated Transaction, but in no event later than sixty (60) days after the Early Termination Date (or such longer additional period, not to exceed an additional sixty (60) days, if the Non-Defaulting Party is unable, despite using commercially reasonable efforts, to calculate the Termination Payment or Damage Payment, as applicable, within such initial sixty (60)-day period despite exercising commercially reasonable efforts), Notice shall be given by the Non-Defaulting Party to the Defaulting Party of the amount of the Damage Payment or Termination Payment, as applicable, and whether the Termination Payment or Damage Payment, as applicable, is due to or from the Non-Defaulting Party. The Notice shall include a written statement explaining in reasonable detail the calculation of such amount and the sources for such calculation. The Termination Payment or Damage Payment, as applicable, shall be made to or from the Non-Defaulting Party, as applicable, within ten (10) Business Days after such Notice is effective.

11.5 Disputes With Respect to Termination Payment or Damage Payment. If the Defaulting Party disputes the Non-Defaulting Party’s calculation of the Termination Payment or Damage Payment, as applicable, in whole or in part, the Defaulting Party shall, within five (5) Business Days of receipt of the Non-Defaulting Party’s calculation of the Termination Payment or Damage Payment, as apphcable, provide to the Non-Defaulting Party a detailed written explanation of the basis for such dispute. Disputes regarding the Termination Payment or Damage Payment, as applicable, shall be determined in accordance with Article 15. iLimitation on Seller’s Ability7
to Make or Agree to Third-Party Sales from the
Facility after Early Termination Date.
48 Item 5
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11.7 Rights And Remedies Are Cumulative. Except where liquidated damages or other remedy are explicitly provided as the exclusive remedy herein, the rights and remedies of a Party pursuant to this Article 11 shall be cumulative and in addition to the rights of the Parties otherwise provided in this Agreement.

11.8 Mitigation. Any Non-Defaulting Party shall be obligated to use commercially reasonable efforts to mitigate its Costs, Losses and damages resulting from any Event of Default of the other Party imder this Agreement.

11.9 Pass Through of Buyer Liability. Notwithstanding any other provision of this Agreement, if Buyer fails to make when due any payment required pursuant to this Agreement, and such failure is not remedied within ten (10) Business Days after Notice thereof, Seller may, without waiving any of itsrights with respect to Buyer except as expressly provided herein, pursue remedies imder any or all of the Buyer Liability Pass Through Agreements as provided therein.

Seller hereby waives the right to recover directly from Buyer any Damage Payment or Termination Payment owed by Buyer that is not paid by Buyer pursuant to Sections 11.3 and 11.4, but the foregoing waiver does not apply to any other right or remedy of Seller imder this Agreement, including the right to recover accrued Monthly Capacity Payments, other amounts payable or reimbursable under this Agreement or any other amoimts inclined or accmed prior to termination of this Agreement, and the right to terminate the ESSA as the result of an Event of Default by Buyer.

ARTICLE 12
LIMITATION OF LIABILITY AND EXCLUSION OF WARRANTIES.

12.1 No Consequential Damages EXCEPT TO THE EXTENT (A) PART OF AN

EXPRESS REMEDY OR MEASURE OF DAMAGES HEREIN, (B) PART OF A THIRD PARTY INDEMNITY CLAIM UNDER ARTICLE 16, (C) INCLUDED IN A LIQUIDATED DAMAGES CALCULATION, OR (D) RESULTING FROM A PARTY’S WILLFUL

MISCONDUCT, NEITHER PARTY SHALL BE LIABLE TO THE OTHER OR ITS

INDEMNIFIED PERSONS FOR ANY SPECIAL, PUNITIVE, EXEMPLARY, INDIRECT, OR

CONSEQUENTIAL DAMAGES, OR LOSSES OR DAMAGES FOR LOST REVENUE OR

LOST PROFITS, WHETHER FORESEEABLE OR NOT, ARISING OUT OF, OR IN CONNECTION WITH THIS AGREEMENT, BY STATUTE, IN TORT OR CONTRACT.

12.2 Waiver and Exclusion of Other Damages. EXCEPT AS EXPRESSLY SET

FORTH HEREIN, THERE IS NO WARRANTY OF MERCHANTABILITY OR FITNESS FOR

A PARTICULAR PURPOSE, AND ANY AND ALL IMPLIED WARRANTIES ARE DISCLAIMED. THE PARTIES CONFIRM THAT THE EXPRESS REMEDIES AND

MEASURES OF DAMAGES PROVIDED IN THIS AGREEMENT SATISFY THE ESSENTIAL PURPOSES HEREOF. ALL LIMITATIONS OF LIABILITY CONTAINED IN

THIS AGREEMENT, INCLUDING, WITHOUT LIMITATION, THOSE PERTAINING TO SELLER’S LIMITATION OF LIABILITY AND THE PARTIES’ WAIVER OF

CONSEQUENTIAL DAMAGES, SHALL APPLY EVEN IF THE REMEDIES FOR BREACH 49 50
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. TO THE

EXTENT ANY DAMAGES REQUIRED TO BE PAID HEREUNDER ARE LIQUIDATED, INCLUDING UNDER SECTIONS 3.5, 11.2 AND 11.3, AND AS PROVIDED IN EXHIBIT B,

EXHIBIT C, AND EXHIBIT P, THE PARTIES ACKNOWLEDGE THAT THE DAMAGES

ARE DIFFICULT OR IMPOSSIBLE TO DETERMINE, THAT OTHERWISE OBTAINING AN

ADEQUATE REMEDY IS INCONVENIENT, AND THAT THE LIQUIDATED DAMAGES

CONSTITUTE A REASONABLE APPROXIMATION OF THE ANTICIPATED HARM OR LOSS. IT IS THE INTENT OF THE PARTIES THAT THE LIMITATIONS HEREIN IMPOSED

ON REMEDIES AND THE MEASURE OF DAMAGES BE WITHOUT REGARD TO THE

CAUSE OR CAUSES RELATED THERETO, INCLUDING THE NEGLIGENCE OF ANY

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

THE PARTIES ACKNOWLEDGE AND AGREE THAT MONEY DAMAGES AND THE

EXPRESS REMEDIES PROVIDED FOR HEREIN ARE AN ADEQUATE REMEDY FOR THE

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

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

12.3 Limitation on Pre-COD Liability. Notwithstanding anything in this Agreement to the contrary, unless and until the Facility has achieved Commercial Operation, Seller’s aggregate liability under this Agreement for any and all reasons, including liabilities for payment of Delay Damages, Commercial Operation Delay Damages and the Damage Payment, shall not exceed of the amount of the Development Security. For avoidance of doubt, this Section 12.3 shall not be applicable once the Facility has achieved Commercial Operation.

ARTICLE 13
REPRESENTATIONS AND WARRANTIES; COVENANTS

13.1 Seller’s Representations and Warranties. As of the Effective Date, Seller represents and warrants as follows:
(a) Seller is a limited liability company, duly organized, validly existing and in good standing under the laws of the jurisdiction of its formation, and is qualified to conduct Item 5
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51 business in each jurisdiction where the failure to so qualify would have a material adverse effect on the business or financial condition of Seller.
(b) Seller has the power and authority to enter into and perform this Agreement and is not prohibited from entering into this Agreement or discharging and performing all covenants and obligations on its part to be performed under and pursuant to this Agreement, except where such failure does not have a material adverse effect on Seller’s performance under this Agreement. The execution, delivery and performance of this Agreement by Seller has been duly authorized by all necessary limited liability company action on the part of Seller and does not and will not require the consent of any trustee or holder of any indebtedness or other obligation of Seller or any other party to any other agreement with Seller. (c) The execution and delivery of this Agreement, consummation of the transactions contemplated herein, and fulfillment of and compliance by Seller with the provisions of this Agreement will not conflict with or constitute a breach of or a default under any Law presently in effect having applicability to Seller, subject to any permits that have not yet been obtained by Seller, the documents of formation of Seller or any outstanding trust indenture, deed of trust, mortgage, loan agreement or other evidence of indebtedness or any other agreement or instrument to which Seller is a party or by which any of its property is bound. (d) This Agreement has been duly executed and delivered by Seller. This Agreement is a legal, valid and binding obligation of Seller enforceable in accordance with its terms, except as limited by laws of general applicability limiting the enforcement of creditors’ rights or by the exercise of judicial discretion in accordance with general principles of equity. (e) Neither Seller nor its Affiliates have received notice from or been advised by any existing or potential supplier or service provider that the disease designated COVID-19 or the related virus designated SARS-CoV-2 have caused, or are reasonably likely to cause, a delay in the construction of the Facility or the delivery of materials necessary to complete the Facility, in each case that would cause the Commercial Operation Date to be later than the Guaranteed Commercial Operation Date.

13.2 Buyer’s Representations and Warranties. As of the Effective Date, Buyer represents and warrants as follows:
(a) Buyer is a joint powers authority, duly organized, validly existing and in good standing under the laws of the State of California and the rules, regulations and orders of the California Public Utilities Commission, and is qualified to conduct business in each jurisdiction of the Joint Powers Agreement members. All Persons making up the governing body of Buyer are the elected or appointed incumbents in their positions and hold their positions in good standing in accordance with the Joint Powers Agreement and other Law. (b) Buyer has the power and authority to enter into and perform this Agreement and is not prohibited from entering into this Agreement or discharging and performing all covenants and obligations on its part to be performed under and pursuant to this Agreement, except where such failure does not have a material adverse effect on Buyer’s performance under this Agreement. The execution, delivery and performance of this Agreement by Buyer has been duly Item 5
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52 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 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 in material compliance with any Law.

13.4 Seller’s Covenants. Seller covenants that commencing on the Effective Date and continuing throughout the Contract Term:
(a) Compliance with Laws. To the extent applicable to Seller or the Facility, Seller shall comply with all federal, state and local laws, statutes, ordinances, rules and regulations, and the orders and decrees of any courts or administrative bodies or tribunals, including, without limitation those related to employment discrimination and prevailing wage, non-discrimination and non-preference; conflict of interest; environmentally preferable procurement; single serving bottled water; gifts; and disqualification of former employees. Seller shall not discriminate against any employee or applicant for employment on the basis of the fact or perception of that person's race, color, religion, ancestry, national origin, age, sex (including pregnancy, childbirth or related medical conditions), legally protected medical condition, family care status, veteran status, sexual Item 5
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53 orientation, gender identity, transgender status, domestic partner status, marital status, physical or mental disability, or AIDS/HIV status.
(b) Workforce Development. Seller shall comply with all applicable federal, state and local laws, statutes, ordinances, rules, regulations and orders and decrees of any courts or administrative bodies or tribunals, including, without limitation, employment discrimination and prevailing wage laws. Although the Facility is not a public work as defined by California Labor Code section 1720, any construction work contracted by Seller in furtherance of this Agreement shall (i) comply with California prevailing wage provisions applicable to public works projects, including but not limited to those set forth in California Labor Code sections 1770, 1771, 1771.1, 1772, 1773, 1773.1, 1774, 1775, 1776, 1777.5, and 1777.6, as they may be amended from time to time (“Prevailing Wage Requirement”); and (ii) be conducted using a project labor agreement, community workforce agreement, work site agreement, collective bargaining agreement, or similar agreement providing for terms and conditions of employment with applicable labor organizations (“Project Labor Agreement”). Seller will request that the following or similar language be included in any Project Labor Agreement executed after the Effective Date: “Union members agree not to make any written or verbal statements about CC Power or its members that are disparaging, untrue or inaccurate.” (c) Prohibition Against Forced Labor. Seller represents and warrants that it has not and will not knowingly utilize equipment or resources for the construction, operation or maintenance of the Facility that rely on work or services exacted from any person under the threat of a penalty and for which the person has not offered himself or herself voluntarily (“Forced Labor”). Consistent with the business advisory jointly issued by the U.S. Departments of State, Treasury, Commerce and Homeland Security on July 1, 2020, equipment or resources sourced from the Xinjiang region of China are presumed to involve Forced Labor. (d) Permits. Seller shall obtain and maintain any and all permits and approvals necessary for the construction and operation of the Facility, including without limitation, environmental clearance under CEQA or other environmental law, as applicable, from the local jurisdiction where the Facility is or will be constructed. (e) Site Control. Seller shall maintain Site Control throughout the Delivery Term.

ARTICLE 14

ASSIGNMENT

14.1 General Prohibition on Assignments. Except as provided below in this Article 14, neither Party may assign this Agreement or its rights or obligations under this Agreement, without the prior written consent of the other Party, which consent shall not be unreasonably withheld, conditioned or delayed. Any Change of Control of Seller (whether voluntary or by operation of law) will be deemed an assignment and will require the prior written consent of Buyer, which consent shall not be unreasonably withheld, conditioned or delayed; provided, a Change of Control of Seller shall not require Buyer’s consent if the assignee or transferee is a Permitted Transferee. Any assignment made without the required written consent, or in violation of the conditions to assignment set out below, shall be null and void. The assigning Party shall pay the Item 5
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other Party’sreasonable expenses associated with the preparation, review, execution and delivery of documents in connection with any assignment of this Agreement by the assigning Party, including without limitation reasonable attorneys’ fees.

14.2 Collateral Assignment. Subject to the provisions of this Section 14.2, Seller has the right to assign this Agreement as collateral for any financing or refinancing of the Facility without the consent of Buyer. In connection with any financing or refinancing of the Facility by Seller, Buyer shall in good faith work with Seller and Lender to agree upon a consent to collateral assignment of this Agreement (“Collateral Assignment Agreement”!, which shall be substantially in the form of Exhibit T. Seller shall pay Buyer’s reasonable expenses, including attorneys’ fees, incurred to provide consents, estoppels, or other required documentation in connection with Seller’s financing of the Facility. Buyer shall have no obligation to provide any consent, or enter into any agreement, that materially and adversely affects any of Buyer’s rights, benefits, risks or obligations under this Agreement, or to modify this Agreement.

14.3 Permitted Assignment.
(a) Seller may, without the prior written consent of Buyer, transfer or assign this Agreement, including through a Change of Control, to: (i) an Affiliate of Seller, (ii) as part of a portfolio financing or portfolio sale of proiectv
Notwithstanding the foregoing, any assignment by Seller, its successors or assigns under this Section 14.3(a) shall be of no force and effect unless and until such Notice and agreement by the assignee have been received and accepted by Buyer.

Buyer may, without the prior written consent of Seller, transfer or assign this Agreement to any member of Buyer that (A) has a Credit Rating of at least BBB- from S&P and Baa3 from Moody’s, and (B) is a load serving entity; provided,Buyer shall give Seller Notice at least fifteen (15) Business Days before the date of such proposed assignment and provide to Seller a written agreement signed by the Person to which Buyer wishes to assign its interests that provides that such Person will assume all of Buyer’s obligations and liabilities under this Agreement upon such transfer or assignment. Notwithstanding the foregoing, any assignment by Buyer, its successors or assigns under this Section 14.3(b) 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 Portfolio Financing. Buyer agrees and acknowledges that Seller may elect to finance all or any portion of the Facility or the Interconnection Facilities or the Shared Facilities (1) utilizing tax equity investment, and/or (2) through a Portfolio Financing, which may include cross-collateralization or similar arrangements. In connection with any financing or refinancing of the Facility, the Interconnection Facilities or the Shared Facilities by Seller or any Portfolio (b)
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Financing, Buyer, Seller, Portfolio Financing Entity (if any), and Lender shall execute and deliver such further consents, approvals and acknowledgments as may be reasonable and necessary to facilitate such transactions; provided, Buyer shall not be required to agree to any terms or conditions which are reasonably expected to have a material adverse effect on Buyer and all reasonable attorney’s fees incurred by Buyer in connection therewith shall be borne by Seller.

14.5 Buyer Financing Assignment. Buyer may assign this Agreement to a financing entity that will pre-pay all of Buyer’s payment obligations under this Agreement with Seller’s prior written consent, which consent shall not be unreasonably withheld, delayed or conditioned; provided that Seller reasonably determines that the terms and conditions of such pre-payment arrangements are satisfactory to Seller and its Lenders and do not adversely affect Seller or its arrangements with Lenders in any respect and that Seller is reimbursed for all costs and expenses incurred by Seller and its Lenders in connection with such transaction.

ARTICLE 15

DISPUTE RESOLUTION

15.1 Governing Law. This Agreement and the rights and duties of the Parties hereunder shall be governed by and construed, enforced and performed in accordance with the laws of the state of California, without regard to principles of conflicts of Law. To the extent enforceable at such time, each Party waives its respective right to any jury trial with respect to any litigation arising under or in connection with this Agreement. The Parties agree that any suit, action or other legal proceeding by or against any Party with respect to or arising out of this Agreement shall be brought in the federal or state courts located in the State of California in a location to be mutually chosen by Buyer and Seller, or in the absence of mutual agreement, the County of San Francisco.

15.2 Dispute Resolution. In the event of any dispute arising under this Agreement, within ten (10) days following the receipt of a Notice from either Party identifying such dispute, the Parties shall meet, negotiate and attempt, in good faith, to resolve the dispute quickly and informally without significant legal costs. If the Parties are unable to resolve a dispute arising hereunder within thirty (30) days after Notice of the dispute, the Parties may pursue all remedies available to them at Law in or equity.

15.3 Attorneys’ Fees. In any proceeding brought to enforce this Agreement or because of the breach by any Party of any covenant or condition herein contained, 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.

ARTICLE 16

INDEMNIFICATION

16.1 Indemnification.
(a) Seller agrees to indemnify, defend and hold harmless Buyer and its Affiliates, directors, officers, attorneys, employees, representatives and agents (collectively, the “Buyer’s Indemnified Parties”) from and against all third-party claims, demands, losses, liabilities, penalties, and expenses (including reasonable attorneys’ fees and expert witness fees), howsoever described, to the extent arising out of, resulting from, or caused by (i) Seller’s breach Item 5
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56 of this Agreement (including inaccuracy of any Seller representation of warranty made hereunder), (ii) a violation of applicable Laws by Seller or its Affiliates, including but not limited to violations of any laws in constructing or operating the Facility, or (iii) negligent or willful misconduct by Seller or its Affiliates, directors, officers, employees, or agents. (b) Buyer agrees to indemnify, defend and hold harmless Seller and its Affiliates, directors, officers, attorneys, employees, representatives and agents (collectively, the “Seller’s Indemnified Parties”) from and against all third-party claims, demands, losses, liabilities, penalties, and expenses (including reasonable attorneys’ fees and expert witness fees), howsoever described, to the extent arising out of, resulting from, or caused by (i) Buyer’s breach of this Agreement (including inaccuracy of any representation of warranty made hereunder), (ii) a violation of applicable Laws by Buyer or its Affiliates, or (iii) negligent or willful misconduct of Buyer or its Affiliates, its directors, officers, employees, or agents. (c) Seller shall indemnify, defend, and hold harmless Buyer’s Indemnified Parties, from any claim, liability, loss, injury or damage arising out of, or in connection with Environmental Costs and any environmental matters associated with the Facility, including the storage, disposal and transportation of Hazardous Substances, or the contamination of land, including but not limited to the Site, with any Hazardous Substances by or on behalf of the Seller or at the Seller’s direction or agreement.
(d) Nothing in this Section 16.1 shall enlarge or relieve Seller or Buyer of any liability to the other for any breach of this Agreement. Neither Party shall be indemnified for its damages resulting solely from its own 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.

Silicon Valley Clean Energy Board of DirectorsFebruary 9, 2022

Silicon Valley Clean Energy Board of Directors
February 9, 2022