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 PPA, 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 PPA 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 Item 4
Attachment 4
One Mountain Enegy, Participating Members and CC Power Project 9 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 Product 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 PPA.
“MW” means megawatts in alternating current, unless expressly stated in terms of direct current.
“MWh” means megawatt-hour measured in alternating current, unless expressly stated in terms of direct current.
“Negative LMP Strike Price” has the meaning set forth in Section 1.1 of the PPA. “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 plus any Accepted Compliance Costs approved by the CCP Board pursuant to Section 5.2(a)(xiii). “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 Security” means (i) cash or (ii) a Letter of Credit in the amount set forth on the Cover Sheet of the PPA.
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Attachment 4
One Mountain Enegy, Participating Members and CC Power Project 10 “Permitted Transferee” has the meaning set forth in Section 1.1 of the PPA. “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.
“Power Purchase Agreement” or “PPA” means the agreement between CCP and Project Developer for the purchase of the electric output of the Fish Lake Geothermal Project, executed on May 31, 2022.
“PPA Defaulting Party” has the meaning set forth in Section 11.1(a) of the PPA. “PPA Non-Defaulting Party” has the meaning set forth in Section 11.2 of the PPA. “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.
“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 PPA.
“Project” shall be broadly construed to entail the aggregate of rights, liabilities, interests, and obligations of CCP pursuant to the PPA, 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 PPA and the rights, liabilities, interests and obligations associated therewith. “Project Committee” means the committee established in accordance with Section6.1. “Project Developer” means Fish Lake Geothermal LLC or assignee as permitted under the PPA.
“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, Capacity Attributes, Ancillary Services, or Environmental Attributes 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.
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Attachment 4
One Mountain Enegy, Participating Members and CC Power Project 11 “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 generating facilities in the Western United States, and (b) any of the practices, methods and acts which, in the exercise of reasonable judgment in light of the facts known at the time the decision was made, could have been expected to accomplish the desired result at a reasonable cost consistent with good business practices, reliability, safety and expedition. Prudent Operating Practice is not intended to be limited to the optimum practice, method, or act to the exclusion of all others, but rather to acceptable practices, methods or acts generally accepted in the industry with respect to grid-interconnected, utility-scale generating facilities in the Western United States. Prudent Operating Practice shall include compliance with applicable Laws, applicable safety and reliability criteria, and the applicable criteria, rules and standards promulgated in the National Electric Safety Code and the National Electrical Code, as they may be amended or superseded from time to time, including the criteria, rules, and standards of any successor organizations.
“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 PPA. “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 PPA. “Real-Time Market” has the meaning set forth in the CAISO Tariff. “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 PPA. “Replacement RA” has the meaning set forth in Section 1.1 of the PPA. “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 Item 4
Attachment 4
One Mountain Enegy, Participating Members and CC Power Project 12 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 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 Energy from the Facility (which is excluded from Shared Facilities) to the point of interconnection, including the Interconnection Agreement itself, that are used in common with third parties.
“Shared Facilities Agreements” has the meaning set forth in Section 6.3 PPA.
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Attachment 4
One Mountain Enegy, Participating Members and CC Power Project 13 “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 PPA, as further described in Exhibit A of the PPA.
“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 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). “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 PPA. “Termination Payment” has the meaning set forth in Section 11.3 of the PPA.
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Attachment 4
One Mountain Enegy, Participating Members and CC Power Project 14 “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 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 PPA, 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;
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Attachment 4
One Mountain Enegy, Participating Members and CC Power Project 15 (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;
(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 PPA, 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 PPA 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”).
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Attachment 4
One Mountain Enegy, Participating Members and CC Power Project 16 (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 PPA (collectively the “Product”), on behalf of the Project Participants.
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 otherwise provided to CCP pursuant to the PPA. To the extent that any Facility Energy, Capacity Attributes, Ancillary Services, or Environmental Attributes associated with the Project or any Replacement RA are delivered to CCP, then CCP shall transfer each Project Participant’s Entitlement Share of such Facility Energy, Capacity Attributes, Ancillary Services, or Environmental Attributes to the Project Participants. CCP shall cause all Facility Energy and associated Environmental Attributes delivered to the Project Participants by the Project Developer, and shall deliver to the Project Participants all Facility Energy and associated Environmental Attributes that CCP receives from the Project Developer, on a fully bundled basis in order to meet the requirements of the portfolio content set forth in California Public Utilities Code Section 399.16(b)(1). CCP shall administer the PPA 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.
3.2. RPS Compliance.
(a) CCP represents and warrants that:
(i) the Product purchased by CCP on behalf of the Project Participants consists of Energy and Environmental Attributes from only Eligible Renewable Energy Resources of the portfolio content set forth in California Public Utilities Code Section 399.16(b)(1); (ii) the Energy and Environmental Attributes that are delivered to Project Participants by Project Developer, or delivered to Project Participants by CCP to the extent Project Developer delivers Energy and Environmental Attributes to CCP, consists only of Energy and Environmental Attributes that have not yet been generated prior to the commencement of the term of the PPA or the Effective Date of this Agreement; (iii) the Energy that is delivered to Project Participants by Project Developer, or delivered to Project Participants by CCP to the extent Project Developer delivers Energy to CCP, shall be transferred to each Project Participant in real time; and Item 4
Attachment 4
One Mountain Enegy, Participating Members and CC Power Project 17 (b) If the PPA includes an agreement to dynamically transfer electricity to a California balancing authority, then any transactions implemented under this Agreement are not contrary to any condition imposed by a balancing authority participating in the dynamic transfer arrangement.
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.
4.1. Change of Entitlement Share. Any Project Participant may reduce its Entitlement Share of the Project pursuant to the process set forth in Exhibit C.
4.2. 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 Product Payments, Damage Payment, or Termination Payment, as applicable, and any other damage payments or reimbursement amounts under the PPA.
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 PPA 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 PPA, 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 PPA.
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Attachment 4
One Mountain Enegy, Participating Members and CC Power Project 18 (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). (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 PPA, 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.
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One Mountain Enegy, Participating Members and CC Power Project 19 (f) Consultants and Advisors Available. CCP shall make available to the Project Committee all consultants and advisors, including financial advisors and legal counsel that 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 PPA 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, Capacity Damages, Guaranteed Energy Production Damages, Damage Payment, and Termination Payment.
(i) Environmental Attributes. CCP shall take such actions or implement such measures as may be necessary to facilitate the transfer of Environmental Attributes from the Project Developer to the Project Participants.
(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 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 Item 4
Attachment 4
One Mountain Enegy, Participating Members and CC Power Project 20 extent CCP is so relieved pursuant to the PPA, and provided further that CCP shall pursue all applicable remedies against the Project Developer under the PPA 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 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 Item 4
Attachment 4
One Mountain Enegy, Participating Members and CC Power Project 21 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 PPA 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) PPA. The CCP Board shall have the authority to review, modify, and approve, as appropriate, all amendments, modifications, and supplements to the PPA. (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 PPA. 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 PPA pursuant to Section 11.2 of the PPA. (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 PPA other than any assignment pursuant to Sections 14.2 or 14.3 of the PPA. (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.
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One Mountain Enegy, Participating Members and CC Power Project 22 (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 PPA.
(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 PPA, 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 PPA, 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 PPA.
(xiii) Compliance Expenditures. The CCP Board shall review, modify, and approve the recommendations of the Project Committee, made pursuant to Section 6.4(b)(vi) of this Agreement, as to Compliance Expenditures, as specified in Section 3.12(c), (d), and (e) of the PPA. If the CCP Board authorizes CCP to agree to reimburse Project Developer for Accepted Compliance Costs, then such amount shall be added to the amount of Operating Costs included in the Monthly Cost calculation for the subsequent month.
(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 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.
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One Mountain Enegy, Participating Members and CC Power Project 23 (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 PPA. (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 PPA or a Project Participant, for Confidential Information as described in Section 18.2 of the PPA, 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.
No Project Participant’s representative shall exercise any greater authority than permitted by the Project Participant which they represent.
6.1. 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.
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One Mountain Enegy, Participating Members and CC Power Project 24 6.2. 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 PPA. (v) Perform such other functions and duties as may be provided for under this Agreement, the PPA, 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 PPA. Review, modify, and approve by a Normal Vote a recommendation to the CCP Board regarding an early termination of the PPA pursuant to Section 11.2 of the PPA.
(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 PPA other than any assignment pursuant to Sections
14.2 or 14.3 of the PPA.
(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.
(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 PPA.
(vi) Compliance Expenditures. Review, modify, and approve by a Normal Vote a recommendation to the CCP Board regarding Compliance Expenditures, as specified in Section 3.12(c), (d), and (e) of the PPA.
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One Mountain Enegy, Participating Members and CC Power Project 25 (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 PPA 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 PPA if an Event of Default has occurred under Section 11.1 of the PPA. (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 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.
(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 PPA, the Development Item 4
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One Mountain Enegy, Participating Members and CC Power Project 26 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 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 PPA, 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 PPA.
(xi) Review and approve the submission of the written
acknowledgement of the Commercial Operation Date in accordance with Section 2.2 of the PPA. (xii) Review and approve the return of the Development Security to Project Developer in accordance with Section 8.8 of the PPA. (xiii) Review and approve the return of any unused Performance Security to Project Developer in accordance with Section 8.9 of the PPA. (xiv) Review Progress Reports provided by Project Developer to CCP pursuant to Section 2.3 of the PPA and participate in any associated regularly scheduled meetings with Project Developer to discuss construction progress. (xv) Direct CCP to collect any liquidated damages owed by Project Developer to CCP under the PPA, and to the extent authorized by PPA, 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 PPA. (xvii) Review and approve the return of the CP Security to Project Developer in accordance with Section 8.7 of the PPA.
(xviii) Review and approve the submission of the Pseudo-tie Participating Generator Agreement in accordance with Section 2.2(b) of the PPA. (xix) Review and approve the submission of the Meter Service Agreement in accordance with Section 2.2(c) of the PPA.
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One Mountain Enegy, Participating Members and CC Power Project 27 (xx) Review and approve the submission of the Interconnection Agreement in accordance with Section 2.2(d) of the PPA. (xxi) Review and confirm that Project Developer has secured the required Firm Transmission Rights in accordance with Section 2.2(f) of the PPA. (xxii) Review and confirm that Project Developer has received CEC Precertification for the Facility in accordance with Section 2.2(g) of the PPA. (xxiii) Direct CCP request that Project Developer submit a Green-e® Energy Tracking Attestation Form the Product delivered under the PPA to the Center for Resource Solutions pursuant to Section 4.10 of the PPA.
(xxiv) Direct CCP change the Negative LMP Strike Price in pursuant to subdivisions (e) of Exhibit C of the PPA.
(xxv) Direct CCP to take such actions or implement such measures as may be necessary to facilitate the transfer of Environmental Attributes from the Project Developer to the Project Participants.
6.3. 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 PPA or this Agreement.
6.4. 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.
6.5. 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 PPA, then CCP may take such commercially reasonable action as CCP determines is necessary for its timely performance under any requirement pursuant to the PPA 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 PPA or this Agreement.
6.6. 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 PPA, 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.
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One Mountain Enegy, Participating Members and CC Power Project 28 ARTICLE 7
[RESERVED]
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 the single highest forecasted Monthly Cost over the first Contract Year. 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 (3), 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 PPA, 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 PPA, any amounts then remaining in any Project Participant’s Operating Account shall be paid to the associated Project Participant.
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One Mountain Enegy, Participating Members and CC Power Project 29 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 Product Payments for the Product, as specified in Section 8.2 of the PPA 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, Capacity Attributes, Ancillary Services, and/or Environmental Attributes, as shown in the following formula:
Monthly Cost = ((Project Participant’s Entitlement Share) × (Monthly Product Payments)) + ((Project Participant’s Entitlement Share) × (Operating Costs)) – ((Project Participant’s Entitlement Share) × (revenue from sale of Facility Energy, Capacity Attributes, Ancillary Services and/or Environmental Attributes))
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 PPA, 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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One Mountain Enegy, Participating Members and CC Power Project 30 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 PPA 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 Product Payment shall be limited to the amount of Monthly Product Payment charged by the Project Developer to CCP and paid by CCP to the Project Developer.
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One Mountain Enegy, Participating Members and CC Power Project 31 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 4
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One Mountain Enegy, Participating Members and CC Power Project 32 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.
11.1. CCP Rights and Obligations under the PPA. 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, 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 PPA 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 PPA in a commercially reasonable manner; (v) all remedies provided to CCP pursuant to the PPA 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 PPA or other event of force majeure affecting the delivery of Product pursuant to applicable provisions of the PPA 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 thereof shall 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 PPA 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.
11.2. Obligations of CCP and Project Participants to Maximize the Economic and Compliance Value of the Project.
(a) Each Project Participant shall take all actions that are (i) reasonably necessary to maximize the economic and compliance value of the Project to the Project Participants, and (ii) only capable of being carried out by the Project Participants. Such actions include, but are not limited to, applying for and securing the import capability rights necessary to support the import of Capacity Attributes from the Project into the CAISO in an amount equal to at least its Entitlement Share of all of the import capability rights that are needed to utilize all of the Resource Adequacy Benefits from the Project.
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One Mountain Enegy, Participating Members and CC Power Project 33 (b) CCP shall take any actions requested by a Project Participant to support the individual Project Participant’s obligation under Section 11.2(a) and any actions requested by a Project Participant that are reasonably necessary to maximize the economic and compliance value of the Project to the Project Participants, to the extent that such actions by CCP are feasible and commercially reasonable.
(c) If any individual Project Participant fails to secure import capability rights or other similar rights in an amount equal to at least its Entitlement Share of all of the import capability rights that are needed to utilize all of the Resource Adequacy Benefits available from the Project, then any resulting reduced economic or compliance value of the Project shall not reduce or otherwise modify that Project Participant’s payment obligations under Section 10.1. (d) CCP and the Project Participants agree to take such additional actions in order to help effectuate the transfer of any import capability rights or similar rights from a Defaulting Project Participant to any Non-Defaulting Project Participants 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). Such actions include but are not limited to executing additional agreements among the Project Participants, amending this Agreement, and/or submitting necessary documents to CAISO and participating in any CAISO process related to the transfer of import capability rights.
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 PPA (“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 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 either of the following occurs, then such occurrence shall constitute a "Payment Default”:
(a) 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 Item 4
Attachment 4
One Mountain Enegy, Participating Members and CC Power Project 34 Operating Account within ten (10) calendar days of the issuance of the Late Payment Notice to such Project Participant by CCP; or
(b) any Project Participant files a petition for Bankruptcy or has a petition for Bankruptcy filed against it, and such Project Participant has not shown that it is able to comply with its obligations under this Agreement to the reasonable satisfaction of Project Developer within sixty (60) days of such Bankruptcy filing, in which case a Payment Default shall occur upon the date that CCP receives a notice regarding such determination from Project Developer.
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 occurring under Section 12.2(a), the Defaulting Project Participant must deposit the full amount of any unpaid Invoice Amounts and any associated Late Payment Penalties into its Operating Account. In order to cure a Payment Default occurring under Section 12.2(b), the Bankruptcy proceeding against the Defaulting Project Participant must be dismissed or Project Developer must issue a Notice to CCP stating that Project Developer has determined that the Defaulting Project Participant has demonstrated that it is able to comply with its obligations under the Agreement.
12.5. Suspension of Project Participant’s Project Revenue Rights and Treatment of Capacity Attributes and Environmental 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 sale of Facility Energy, Capacity Attributes, Ancillary Services, or Environmental Attributes 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 Product, including Capacity Attributes and Environmental Attributes, associated with the Facility or otherwise provided for pursuant to the PPA. For any Month where the funds remaining in a Item 4
Attachment 4
One Mountain Enegy, Participating Members and CC Power Project 35 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 PPA.
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 PPA. 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 PPA. CCP first shall withdraw all funds from a Defaulting Project Participant’s Operating Account before withdrawing funds from the Step-Up Reserve Account.
Item 4
Attachment 4
One Mountain Enegy, Participating Members and CC Power Project 36 (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. (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.
(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 Item 4
Attachment 4
One Mountain Enegy, Participating Members and CC Power Project 37 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 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 Item 4
Attachment 4
One Mountain Enegy, Participating Members and CC Power Project 38 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) Import Capacity Rights. If a Defaulting Project Participant’s Project Rights are terminated pursuant to Section 12.6, then such Defaulting Project Participant shall transfer all import capacity rights and other similar rights that are associated with the Project and that are held by such Defaulting Project Participant to the Non-Defaulting Project Participants that assume 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). The Defaulting Project Participant shall take all actions necessary to effectuate the transfer of such rights to the Non-Defaulting Project Participants. (f) 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 PPA. 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 Item 4
Attachment 4
One Mountain Enegy, Participating Members and CC Power Project 39 Agreement is a several obligation and not a joint obligation with those of the other Project Participants.
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 PPA. 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 PPA. 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 PPA.
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 (an “Indemnifying 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 Item 4
Attachment 4
One Mountain Enegy, Participating Members and CC Power Project 40 (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 asserted against any Party arising by manner of any breach of this Agreement by the Indemnifying Party, or the negligent acts, errors, omissions or willful misconduct incident to the performance of this Agreement on the part of any such Indemnifying Party or any Indemnifying 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 Item 4
Attachment 4
One Mountain Enegy, Participating Members and CC Power Project 41 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.
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 Item 4
Attachment 4
One Mountain Enegy, Participating Members and CC Power Project 42 include electronic signatures or electronic records, each of which shall be of the same legal effect, 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.
Item 4
Attachment 4
One Mountain Enegy, Participating Members and CC Power Project 43 (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 4
Attachment 4
One Mountain Enegy, Participating Members and CC Power Project 44 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 4
Attachment 4
One Mountain Enegy, Participating Members and CC Power Project 45 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]
Item 4
Attachment 4
One Mountain Enegy, Participating Members and CC Power Project 46 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:
Central Coast Community Energy
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:
Item 4
Attachment 4
One Mountain Enegy, Participating Members and CC Power Project 47 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:
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:
Item 4
Attachment 4
One Mountain Enegy, Participating Members and CC Power Project 48 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:
Item 4
Attachment 4
One Mountain Enegy, Participating Members and CC Power Project Exhibit A - 1
EXHIBIT A
NOTICES
Party All Notices Invoices
California
Community Power
California Community Power
Tim Haines, Interim General
Manager
California Community Power
70 Garden Court, 3rd Floor
Monterey, CA 93940
timhaines@powergridsymmetry
.com
Central Coast
Community Energy
Central Coast Community
Energy
Robert M. Shaw, Chief
Operating Officer & General
Counsel
Central Coast Community
Energy
70 Garden Court, 3rd Floor
Monterey, CA 93940
[email protected]
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
Item 4
Attachment 4
One Mountain Enegy, Participating Members and CC Power Project Exhibit A - 2
Party All Notices Invoices
Redwood Coast
Energy Authority
Redwood Coast Energy
Authority
Matthew Marshall, CEO
Redwood Coast Energy
Authority
633 3rd Street
Eureka, CA 95501
[email protected]
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
Item 4
Attachment 4
One Mountain Enegy, Participating Members and CC Power Project Exhibit A - 3
Party All Notices Invoices
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
Item 4
Attachment 4
One Mountain Enegy, Participating Members and CC Power Project Exhibit B - 1
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
Central Coast Community Energy 18.6%
Clean Power San Francisco 14.5%
Peninsula Clean Energy 17.8%
Redwood Coast Energy Authority 2.8%
San José Clean Energy 17.4%
Silicon Valley Clean Energy 14.0%
Sonoma Clean Power 11.7%
Valley Clean Energy 3.2%
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 Item 4
Attachment 4
One Mountain Enegy, Participating Members and CC Power Project Exhibit B - 2
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.
Item 4
Attachment 4
One Mountain Enegy, Participating Members and CC Power Project Exhibit C - 1
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 PPA 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.
Item 4
Attachment 4
One Mountain Enegy, Participating Members and CC Power Project Exhibit C - 2
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.
Item 4
Attachment 4
One Mountain Enegy, Participating Members and CC Power Project Exhibit D - 1
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:
Item 4
Attachment 4
One Mountain Enegy, Participating Members and CC Power Project Exhibit D - 2
(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.
Item 4
Attachment 4
One Mountain Enegy, Participating Members and CC Power Project DocuSign Envelope ID: 63005132-FE5C-4142-AC7C-FFE4ADC0D0FF California Community Power
Resolution 22-05-03
APPROVAL OF FISH LAKE GEOTHERMAL PROJECT AND AUTHORIZATION
TO EXECUTE ASSOCIATED AGREEMENTS
WHEREAS, California Community Power (“CC Power”) was created by a Joint Powers Agreement (“JPA”) to develop, acquire, construct, own, manage, contract for, engage in, finance and/or provide energy related programs for the use of and by its Members; and WHEREAS, on September 15, 2021 CC Power authorized the issuance of a Request for Offers (“RFO”) for Firm Clean Resources (“FCR”); and
WHEREAS, the FCR RFO was issued on October 25, 2021 and responses were received on December 21, 2021; and
WHEREAS, the CC Power Board accepted the Project Development Process establishing a roadmap for the development and progress of CC Power projects and programs; and WHEREAS, the FCR Project Oversight Committee made up of CC Power member staff, along with project negotiators and project counsel (“Project Team”), has completed negotiations on the Fish Lake Geothermal Project, a 13 MW geothermal power; and
WHEREAS, the Project Team, through the negotiation process, has developed and negotiated a Power Purchase Agreement, Buyer Liability Pass Through Agreement, and Project Participation Share Agreement associated with the Fish Lake Geothermal Project; and WHEREAS, pursuant to Section 6.02 of the CC Power JPA, on May 31, 2022, the CC Power Board waived the required notice of intent to bring the Fish Lake Geothermal Project to the Board for approval; and
WHEREAS, while the structure of CC Power is predicated on voluntary project participation and not all Members will be participating in the Fish Lake Geothermal Project, the JPA requires action by the full Board, not simply the project participating members, to approve projects within the purview of CC Power; and
WHEREAS, it is the intent that the CC Power Board approve the Fish Lake Geothermal Project and associated agreements with the understanding that approval by participating members is a condition precedent to the effectiveness of the agreements.
NOW, THEREFORE, BE IT RESOLVED that the Board of Directors of CC Power hereby:
1. Approve the Fish Lake Geothermal Project as within the purpose and power of CC Power.
2. Approve the Power Purchase Agreement and associated Buyer Liability Pass Through Agreement, in substantially final form, attached hereto as Attachment A.
3. Approve the Project Participation Share Agreement, in substantially final form, attached hereto as Attachment B.
4. Delegate the authority to the General Manager to execute the Fish Lake Geothermal Project Agreements described above and attached hereto, on behalf of CC Power.
Item 4
Attachment 5
DocuSign Envelope ID: 63005132-FE5C-4142-AC7C-FFE4ADC0D0FF California Community Power
Resolution 22-05-03
Attest by:
PASSED AND ADOPTED by the Board of Directors of California Community Power this 31st day of May, 2022, by the following vote:
Aye No Abstain Absent
Central Coast Community Energy Rob Shaw X
CleanPowerSF Barbara Hale X
East Bay Community Energy Nick Chaset X
Marin Clean Energy Dawn Weisz X
Peninsula Clean Energy Jan Pepper X
Redwood Coast Energy Authority Lori Biondini X
San José Clean Energy Lori Mitchell X
Silicon Valley Clean Energy Girish Balachandran X
Sonoma Clean Power Authority Geof Syphers X
Valley Clean Energy Mitch Sears X
Chair Secretary
Item 4
Attachment 5
~
Doc uSigne d by:
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DocuSigned by:
{JyjfrAAUq (Lt,s 93ACBC171893454 ...
DocuSign Envelope ID: 63005132-FE5C-4142-AC7C-FFE4ADC0D0FF California Community Power
Resolution 22-05-04
APPROVAL OF ORMAT GEOTHERMAL PORTFOLIO PROJECT AND AUTHORIZATION
TO EXECUTE ASSOCIATED AGREEMENTS
WHEREAS, California Community Power (“CC Power”) was created by a Joint Powers Agreement (“JPA”) to develop, acquire, construct, own, manage, contract for, engage in, finance and/or provide energy related programs for the use of and by its Members; and WHEREAS, on September 15, 2021 CC Power authorized the issuance of a Request for Offers (“RFO”) for Firm Clean Resources (“FCR”); and
WHEREAS, the FCR RFO was issued on October 25, 2021 and responses were received on December 21, 2021; and
WHEREAS, the CC Power Board accepted the Project Development Process establishing a roadmap for the development and progress of CC Power projects and programs; and WHEREAS, the FCR Project Oversight Committee made up of CC Power member staff, along with project negotiators and project counsel (“Project Team”), has completed negotiations on the Ormat Geothermal Portfolio Project, a portfolio of geothermal powered electric generating plants; and WHEREAS, the Project Team, through the negotiation process, has developed and negotiated a Power Purchase Agreement, Buyer Liability Pass Through Agreement, and Project Participation Share Agreement associated with the Ormat Geothermal Portfolio Project; and WHEREAS, pursuant to Section 6.02 of the CC Power JPA, on May 31, 2022, the CC Power Board waived the required notice of intent to bring the Ormat Geothermal Portfolio Project to the Board for approval; and
WHEREAS, while the structure of CC Power is predicated on voluntary project participation and not all Members will be participating in the Ormat Geothermal Portfolio Project, the JPA requires action by the full Board, not simply the project participating members, to approve projects within the purview of CC Power.
WHEREAS, it is the intent that the CC Power Board approve the Ormat Geothermal Portfolio Project and associated agreements with the understanding that approval by participating members is a condition precedent to the effectiveness of the agreements.
NOW, THEREFORE, BE IT RESOLVED that the Board of Directors of CC Power hereby:
1. Approve the Ormat Geothermal Portfolio Project as within the purpose and power of CC Power.
2. Approve the Power Purchase Agreement and associated Buyer Liability Pass Through Agreement, in substantially final form, attached hereto as Attachment A.
3. Approve the Project Participation Share Agreement, in substantially final form, attached hereto as Attachment B.
4. Delegate the authority to the General Manager to execute the Ormat Geothermal Portfolio Project Agreements described above and attached hereto, on behalf of CC Power.
Item 4
Attachment 6
DocuSign Envelope ID: 63005132-FE5C-4142-AC7C-FFE4ADC0D0FF California Community Power
Resolution 22-05-04
Chair Attest by:
PASSED AND ADOPTED by the Board of Directors of California Community Power this 31st day of May, 2022, by the following vote:
Aye No Abstain Absent
Central Coast Community Energy Rob Shaw X
CleanPowerSF Barbara Hale X
East Bay Community Energy Nick Chaset X
Marin Clean Energy Dawn Weisz X
Peninsula Clean Energy Jan Pepper X
Redwood Coast Energy Authority Lori Biondini X
San José Clean Energy Lori Mitchell X
Silicon Valley Clean Energy Girish Balachandran X
Sonoma Clean Power Authority Geof Syphers X
Valley Clean Energy Mitch Sears X
Secretary
Item 4
Attachment 6
DocuSigned by:
L~L~i~
Staff Report – Item 5
Item 5: SVCE Strategic Plan FY 23 Update
From: Girish Balachandran, CEO
Prepared by: Andrea Pizano, Board Clerk/Executive Assistant Date: 6/8/2022
RECOMMENDATION
Receive a presentation from staff on preliminary updates to the FY 23 SVCE Strategic Plan.
BACKGROUND
SVCE’s Strategic Plan was first adopted in June of 2017. Since then, the plan has undergone an annual review and approval process.
Staff has started the process of reviewing the Strategic Plan and work plan for changes in FY 2023; initial observations were brought to the May 27, 2022 Executive Committee for feedback.
ANALYSIS & DISCUSSION
With internal discussions underway, staff would like to introduce some of the early ideas regarding the FY 23 Strategic Plan. Based on feedback received, suggestions will be incorporated into a final version of the plan which will be brought to the Board for approval in September.
STRATEGIC PLAN
N/A
ALTERNATIVE
N/A
FISCAL IMPACT
N/A
ATTACHMENT
The presentation for this item is posted on SVCE’s website.
Item 5
/ A"\ SILICON VALLEY
~CLEAN ENERGY
Staff Report – Item 6
Item 6: Results of Stress Test Analyses
From: Girish Balachandran, CEO
Prepared by: Amrit Singh, CFO and Director of Administrative Services Karthik Rajan, Senior Risk Manager
Date: 6/8/2022
RECOMMENDATION
Receive the results of the Stress Test analyses. This report provides background information that staff will use in developing recommendations to the Board for holding higher reserve levels for the next fiscal year (2022- 2023) budget.
FINANCE AND ADMINISTRATION COMMITTEE, AND EXECUTIVE COMMITTEE REVIEWS The Finance and Administration Committee (F&A) and the Executive Committee (EC) in their meetings in May 2022 reviewed and discussed the results of the stress test analyses. The committees asked clarifying questions to understand the risks modeled and the implications of the analyses. The F&A asked further questions regarding SVCE’s energy procurement hedging strategy and staffs plans to conduct additional analyses of the hedging strategy.
BACKGROUND
Staff conducted stress tests to assess the critical risks facing the organization that can threaten its viability to carry its mission. The stress test scenarios, also often referred to as Black Swan events in risk terminology, are extreme but plausible events that if occurred could have severe adverse effects on the organization.
In constructing the stress test scenarios, cross-functional teams at SVCE brainstormed on risks facing the agency over the next five calendar years. Out of those discussions, the team prioritized five stress test scenarios that based on staff’s professional assessment could have the most severe consequences for SVCE.
The Risk Oversight Committee also provided the CEO with feedback on the construction of the scenarios and the results of the analyses.
Four out of the five scenarios are impacted by market price uncertainties:
1. Significant drop in energy prices that result in higher Power Cost Indifference Adjustment (PCIA) and lower Pacific Gas and Electric (PG&E) generation rate.
2. Insufficient financial liquidity caused by:
a. Energy price collapse that reduces SVCE’s margins and triggers credit downgrades b. Higher energy collateral postings form counterparties and the California Independent System Operator (CAISO)
c. Pending regulatory case that significantly increases Financial Security Requirements (FSR) to the Provider of Last Resort (POLR), which for SVCE currently is PG&E. FSR amounts posted are held by POLR as financial security in the event a community choice aggregator’s (CCA’s) customers are returned to POLR such as during a CCA bankruptcy.
3. Power Purchase Agreements (PPAs) default, renegotiate for higher prices and/or delay their commercial start dates that result in RPS non-compliance penalties and replacement of energy and RA at higher market prices.
Item 6
IA'\ SILICON VALLEY ~ CLEAN ENERGY
Agenda Item: 6 Agenda Date: 6/08/2022
4. SVCE loses load due to direct access and growth in distributed energy resources.
The fifth scenario addresses risks that deal with threat to public services or facilities and will be discussed in a closed session of the Board meeting.
Other scenarios that were not selected but could be selected in the future include:
• Operational Risks
o Modeling Errors
o Process failures
o Governance and Risk Control Weaknesses
• Additional risks from Regulatory and Legislative actions • Additional Areas of Risks that can affect SVCE’s services and facilities
ANALYSIS & DISCUSSION
The key finding from the stress test analyses is that the most significant financial risk facing SVCE is a collapse in energy prices. A collapse in energy prices will significantly reduce SVCE’s revenues because of higher PCIA and lower PG&E generation rates and will not significantly reduce our energy purchase costs because the prices for most of the forward energy purchases are locked as result of hedging over the next five years of the stress test study period with more hedges in the earlier years following the Energy Risk Management Policy hedging targets. The hedges also include contracts for fixed-price purchase of renewable energy. The price collapse impact overwhelms all other stress factors.
The attachments to this report contain the summary tables with financial results under the current base case scenario and the modeled stress case scenarios. The base case shows significant growth in reserves from forecast 2022 level of $227 million to $322 million at the end of 2023 and continued strong growth in margins over the next five years1. The modeled results are based on the assumptions that the current high forward prices and other modeled assumptions especially those around PCIA and PG&E generation portfolio prevail.
PCIA and PG&E generation portfolio assumptions are based on public data as best modeled by the California Community Choice Association (CalCCA) consultant NewGen Strategies and are highly uncertain. In addition to not knowing the contents of the PCIA portfolio and PG&E’s generation portfolio, PG&E’s portfolio management strategy may change from those modeled, and the California Public Utilities Commission (CPUC) may moderate future PG&E generation rate increases. All these uncertainties make the absolute value of the results highly unreliable. Nevertheless, the relative differences among the base case and the modeled stress test scenarios are highly pertinent in understanding our strategic risks. The focus of the stress test is on the delta of the base case to the stress test results.
The following is a summary of what the staff expected when constructing the scenarios versus the results of the analyses.
Scenario 1 – Prices Collapse
Expectation: Because of higher PCIA and lower PG&E Generation rate, SVCE’s revenues will drop significantly and meeting operating expenses while maintaining a one percent effective discount rate to comparable PG&E’s rates will lead to significant draw from reserves.
Result: Same as expected.
To provide customers with competitive rates, SVCE sets its generation rates such that customers receive an effective discount, currently set at one percent, to comparable PG&E rates. Because CCA customers must pay 1 SVCE’s reserves as of March 31, 2022, was at about $147 million and the corresponding days cash on hand was at 165.
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PCIA charges, to provide the effective discount rate SVCE reduces its rate by the PCIA amount. As a result, if PCIA increases and PG&E generation rate decreases, SVCE generation rates and therefore revenues decline.
Market prices for energy are at an all-time high level with most of the increases occurring in the last 12 months. Stress test Scenario 1 assumes that market prices beginning in 2023 and for all forward months in the five-year study period drop to the one percentile level, which is close to where prices were trading as recently as twelve months ago. If this were to occur and SVCE maintains its current rate methodology, then there would be a draw of $178 million from reserves in 2024 leaving days cash on hand (DCOH) at 181 days and DCOH declining to 41 by 2027, well below the current Board established minimum target of 120. The reserves start at a high-level of $322 million (388 DCOH) at the end of 2023 because of the current high prices. Per the scenario assumptions, the price collapse occurs at start of 2023, but the impact will not be felt until 2024 when new PCIA and PG&E generation rates take effect reflecting the lower realized prices in 2023 and lower forwards for 2024.
Scenario 2 – Price Collapse leads to insufficient financial liquidity Expectation: Price collapse would trigger large collateral postings and lead to large draw from reserves.
Result: Price collapse does not trigger any significant liquidity needs. However, there’s large draw of $35 million that’s modeled for potential regulatory change to the financial security requirement (FSR) deposit for CCA’s.2
The standard credit risk management practice, except for long-term Power Purchase Agreements (PPAs), is the requirement to post collateral, usually cash or letters of credit, when the exposure to the counterparty reaches the negotiated credit limit. A price collapse would increase our counterparties credit risk or exposure to SVCE and per the contract when the credit limit is reached SVCE must post the required collateral. Because of SVCE’s active management of collateral posting requirement including placing key counterparties in a lockbox mechanism in return for not having posting requirements and long-term PPAs not being subject to this requirement, the price collapse does not have a significant impact on liquidity.
The most significant impact comes from regulatory uncertainty under potential changes to the FSR requirements. Each CCA is required to post an FSR amount to their incumbent investor-owned utilities (IOU), PG&E for SVCE, that the utility can draw upon should the CCA fail and return its customers to the IOU. The IOUs are currently the provider of last resort (POLR). The current FSR methodology is largely based on the difference between the IOUs retail rates and forecast of serving the CCA load over a 6-month period, where the FSR is adjusted every six months. Under current regulatory proceedings, certain proposals from the IOUs that seems to be gaining traction could increase the posting requirement for SVCE to two months of the energy cost of serving the customers, which under current market conditions could be as high as $70 million.
Because under the stress case assumption, the price collapse would reduce the cost of serving the customers, the FSR is modeled at $35 million.
The stress test modeling of additional liquidity needs of $35 million for FSR is additive to the Scenario 1 price collapse. As a result, Scenario 2 is the most consequential of the four price uncertainty scenarios modeled. If Scenario 2 were to occur, the DCOH in 2024 would be 137 and by 2027, SVCE would run out of cash.
Scenario 3 – PPAs default/delay/renegotiate for higher prices Expectation: Price increases result in higher replacement cost.
Result: Price increases lead to substantial increases in revenues which far exceed the increase in higher energy procurement costs.
2 The current FSR posting for SVCE is at the minimum required level of $147,000.
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If our PPAs default on their contractual obligations, delay their commercial operation date, or renegotiate for higher prices, SVCE’s energy procurement cost could increase substantially. The higher costs would occur under a high price scenario. If prices are low, then the energy can be replaced at relatively lower prices.
Another cost dimension is RPS compliance penalties, under the modeled scenario the non-compliance penalties were not significant.
While the procurement costs would increase under the price increase scenario, the growth in revenues from lower PCIA and higher PG&E generation rates far offset the increase in procurement costs. The scenario results in better financial outcome than the base case and for this reason, the results shown for Scenario 3 in the attachment assumes the Scenario 1 price collapse assumption.
While under the entirety of the price increase scenario the results are favorable, SVCE must continue its efforts to ensure the PPAs perform as expected. Isolating (ignoring the increase on the revenue side) the increase in the procurement cost of energy under the high price scenario could cost approximately $80 million in 2026.
Scenario 4 – Load Loss
Expectation: Load loss along with price collapse leads to stranded assets.
Result: Price collapse significantly reduces SVCE revenues, as explained in scenario 1, such that the operating margin turns negative, and loss of load reduces selling energy at a loss.
The results of this scenario are better than those of scenario 1.
This scenario assumes that SVCE loses 10% of load in 2025 and another 10% in 2027 from growth in direct access and distributed energy resources. In addition to lost revenues, load loss can result in stranded assets.
The stranded assets are the power procured on the departed customers behalf that must now be sold in the open market at a lower price. The assets will be stranded if SVCE has to sell the power at a loss, which would occur under a low-price scenario such as those modeled under Scenario 1. As explained in Scenario 1, price collapse leads to significant loss of revenues such that the operating margin in years 2024 to 2025 is negative.
Under this condition, load loss reduces selling more energy at a loss resulting in slightly better financials than those of Scenario 1.
SVCE should continue its efforts to retain and attract customers. While the modeled stress scenario is overwhelmed by the price collapse factor, on an expected basis relative to the base case, load loss of 10% in 2025 and another 10% in 2027 would harm SVCE by about $8 million in 2025, $8 million in 2026 and $16 million in 2027.
STRATEGIC PLAN
These analyses 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 stress test analyses shows that the key financial risk facing SVCE is a collapse in energy prices that can significantly reduce revenues and require substantial draw of funds from the reserves. The best mitigation of this risk is to hold sufficient fund in reserves. Staff will use the results of these analyses to recommend reserve levels for the Board to consider in setting the Fiscal Year 2022-23 budget.
Staff is also reviewing SVCE’s energy hedging strategies. Some of the challenges in setting the hedging strategy is the uncertainty in modeling the PCIA and PG&E generation rates along with potentially increasing the volatility in power supply costs relative to the budgeted costs.
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ATTACHMENT
1. Summary of Base Case Results
2. Summary of Stress Test Results
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Attachment 1 – Summary of Base Case Results
2023 2024 2025 2026 2027
Revenues $ 398 $ 410 $ 391 $ 374 $ 375
Power Supply Cost $ 271 $ 281 $ 279 $ 272 $ 272
Operating Margin $ 127 $ 129 $ 112 $ 102 $ 102
Other Costs $ 32 $ 32 $ 33 $ 33 $ 34
Net Contribution to Reserves $ 95 $ 97 $ 79 $ 69 $ 69
Projected Reserve Balance $ 322 $ 418 $ 497 $ 566 $ 635 Days Cash on Hand 388 487 582 677 758
Uncertain
Highly
Uncertain
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Attachment 2 – Summary of Stress Test Results
Stress Case 1 - Significant Drop in Energy Prices
2023 2024 2025 2026 2027
Revenues $ 398 $ 112 $ 240 $ 236 $ 236
Power Supply Cost $ 271 $ 257 $ 246 $ 240 $ 239
Operating Margin $ (145)$ 127 (5)$ (5)$ (3)$
Other Costs $ 32 $ 33 $ 33 $ 34 $ 34
Net Contribution to Reserves $ (178)$ (38)$ (38)$ (36)$ 95 Projected Reserve Balance $ 322 $ 144 $ 106 $ 67 $ 31
Days Cash on Hand 388 181 138 90 41
Stress Case 2 - Insufficient Liquidty
2023 2024 2025 2026 2027
Revenues $ 398 $ 112 $ 240 $ 236 $ 236
Power Supply Cost $ 271 $ 257 $ 246 $ 240 $ 239
Operating Margin $ (145)$ 127 (5)$ (5)$ (3)$
Other Costs $ 32 $ 33 $ 33 $ 34 $ 34
Net Contribution to Reserves $ (178)$ (38)$ (38)$ (36)$ 95 Projected Reserve Balance $ 322 $ 144 $ 106 $ 67 $ 31
After FSR Requirement $ 287 $ 109 $ 71 $ (4)$ 32
Days Cash on Hand 346 137 92 43 (5)
Stress Case 3 - PPAs Default
2023 2024 2025 2026 2027
Revenues $ 398 $ 112 $ 240 $ 236 $ 236
Power Supply Cost $ 258 $ 239 $ 229 $ 227 $ 226
Operating Margin $ (127)$ 139 $ 9$ 11 $ 11
Other Costs $ 32 $ 33 $ 33 $ 34 $ 34
Net Contribution to Reserves $ (159)$ (22)$ (25)$ (23)$ 107 Projected Reserve Balance $ 334 $ 175 $ 153 $ 128 $ 105 Days Cash on Hand 420 235 212 179 148
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Stress Case 4 - Load Loss
2023 2024 2025 2026 2027
Revenues $ 398 $ 112 $ 216 $ 212 $ 189
Power Supply Cost $ 271 $ 257 $ 210 $ 204 $ 168
Operating Margin $ (145)$ 127 7$ 8$ $ 21
Other Costs $ 32 $ 33 $ 33 $ 34 $ 34
Net Contribution to Reserves $ (178)$ (26)$ (26)$ (13)$ 95 Projected Reserve Balance $ 322 $ 144 $ 118 $ 92 $ 79
Days Cash on Hand 388 181 177 141 143
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Staff Report – Item 7
Item 7: Update on Digital Engagement Initiatives and Spring 2022 SVCE Electrification Awareness Survey Results
From: Girish Balachandran, CEO
Prepared by: Don Bray, Director of Energy Services & Community Relations Pamela Leonard, Communications Manager
Date: 6/8/2022
RECOMMENDATION
Staff recommends the Board receive an update on SVCE digital engagement initiatives and the results of the Spring 2022 SVCE and electrification awareness survey.
BACKGROUND
For FY ‘20-21, SVCE highlighted a ‘digital pivot’ – a shift to increase customer digital engagement – as a Strategic Focus Area. Staff expanded digital outreach efforts as a primary method for customer engagement.
Use of digital outreach, resources and tools is a scalable, high-impact and cost-effective way to engage with customers.
The focal point of this digital engagement effort was the development of an online Customer Resource Center, called eHub, where customers can learn about and act on electrification at home and on the road. Staff has also expanded SVCE email marketing capabilities and launched a robust digital ad campaign to drive traffic and awareness to the SVCE website and eHub resources.
With eHub, SVCE aims to support customers’ electrification journeys by bringing electrification to customers’ minds, providing knowledge to customers about the benefits of electrification and assisting customers with taking action. With over one year of operating eHub and advancing SVCE’s digital outreach, staff has aggregated various metrics and goals for website engagement, email campaigns and the online eHub promotions. Key digital engagement tools and updates include the eHub online content and tools, the email marketing service Granicus GovDelivery, and a website redesign and content update.
In 2020, staff engaged ADM Energy, the SVCE-contracted Evaluation, Measurement & Verification vendor, to complete a survey of customers to measure SVCE and electrification awareness among residential customers.
This was done to establish a baseline awareness ahead of launching a robust email marketing and advertising campaign. In spring of 2022, staff engaged with ADM Energy again to conduct a follow-up survey measuring SVCE and electrification awareness since launching eHub. This survey was administered via phone and email in English, Traditional Chinese, Spanish and Vietnamese throughout March and April of 2022 and received 481 complete responses.
In both surveys, customers were grouped by census tract into Socioeconomic Vulnerability Index (SEVI) quartiles to provide greater insight into SVCE and electrification awareness across different customer segments and identify how we can equitability conduct outreach.
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ANALYSIS & DISCUSSION
SVCE has seen significant growth in website visits since launching eHub and its associated electrification resources. The following high-level statistics show how SVCE has measured the impact and reach of these resources and marketing efforts. Additional details are provided in the attached presentation.
Website Analytics
Since deploying SVCE’s ‘digital pivot’ the total number of website visits has grown by 280%. SVCE used various tactics during this time to increase engagement to the website including email marketing, online promotions and sweepstakes, digital, in-language and out-of-home advertising, member community cross-marketing and social media. Email marketing paired with online promotions and sweepstakes proved to be one of the most influential tactics in engaging customers with the website and eHub resources.
As SVCE was one of the first utilities to launch an online hub that packages electrification resources and tools, there was little industry insight in creating benchmarks for eHub engagement goals. Based on prior website usage and analysis, SVCE set an initial FY 20-21 goal of reaching 20,000 new unique users. Throughout the initial year of eHub, 74,000 unique users engaged with the online tools and resources, exceeding this goal. For this fiscal year, SVCE aims to reach 200,000 unique users and is currently at over 69,000 users.
To understand how customers are engaging with the eHub resources, SVCE evaluated the average ‘time on page’ for the different eHub resources. ‘Time on page’ indicates how long a web user is interacting with the specific website and webpage. All resources had a ‘time on page’ above the industry standard for what is considered a good ‘time on page’ length.
Email Marketing
A large portion of the overall website visits are being driven by educational email campaigns and strategies. In FY ’20-21 SVCE had a goal to deliver 1 million outbound emails to customers. SVCE sent 2.1 million during the fiscal year. SVCE also maintains an above-average open rate, the percentage of emails opened by customers.
Industry-standard is about 22% according to Enervee Performance Benchmarks and SVCE maintained an average open rate of 35%. The emails are designed to communicate the benefits of going all-electric at home and on the road with fun, easy-to-digest language and calls-to-action.
Online Promotions and Sweepstakes
Paired with email outreach, SVCE deployed various promotions and sweepstakes to help encourage customers to engage with the online resources. Through the Appliances Assistant, SVCE deployed promotions in which customers could receive up to $50 off the purchase of eligible electric products. In total, over 1,000 total rebates were claimed through the Appliances Assistant. Promotions included $50 off portable induction cooktops, air purifiers, portable batteries, and evaporative coolers, as well as money off LED light bulbs and smart power strips. SVCE also hosted two online sweepstakes to share electrification resources and education on the benefits of all-electric homes. In total, 6,549 users engaged with the sweepstakes.
Through the Solar+Battery Assistant, customers can receive $1,000 off the price of a main service panel upgrade for a battery or solar+battery installation. This is to help encourage customers to look at battery options if they are interested in rooftop solar. The Solar+Battery Assistant tool is a no-obligation, online concierge service that provides interested customers with independent, third-party assistance to identify their energy needs, have a system designed, and receive quotes from multiple local contractors. Through this resource, there has been a total of 387 leads, 189 sales proposals, and 36 sales, 20 of which include a battery.
Customer Awareness Survey
In spring 2022, SVCE gained additional insight for marketing and program development by conducting a second customer electrification awareness survey. The results of this follow-up survey continue to emphasize Item 7
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the need for continued outreach and education efforts that communicate the benefits of electrification and provide education about SVCE.
Some key takeaways from the survey include:
• Most customers think of PG&E first as their power provider – the unaided recall of SVCE was 10% of respondents. SVCE awareness requires differentiated branding and messaging and continued outreach and education efforts. Once prompted with the name “Silicon Valley Clean Energy” 73% of respondents heard of SVCE. However, there was no statistically significant increase from 2020. • The survey showed that there was a significant increase in respondents indicating that they have visited the SVCE website in 2022 compared to 2020. 14% of respondents reported that they had visited the webpage in 2020 compared to 22% in 2022. This shows that our tactics and efforts work to increase website users and to continue marketing efforts to increase website engagement. • Customers in SEVI 3 and SEVI 4 were more interested in cost savings, than in less economically burdened SEVI 1 and SEVI 2. With this, SVCE can increase education on rebates and the cost benefits of all-electric technologies when marketing to customers that reside in SEVI 3 and 4. • The level of worry about fossil fuel usage was lower in 2022 than in 2020 – however, not a statistically significant decrease. Looking at the ‘current events’ landscape from the Spring of 2022 compared to the Fall of 2020, hypotheses could be made on how this may have affected survey responses. For example, consumers in Fall of 2020 were likely influenced by the recent record heat, fires and smoke; In spring 2022, consumers may be more concerned with the ongoing pandemic, supply chain issues, and geopolitical conflict in Europe.
• Cost proves to be among the top five barriers to adoption for electric vehicles, heat pump water heaters, solar+battery storage, and other electric technologies. In addition, most respondents have some level of interest in electric vehicles while few homeowners have a heat pump water heater or have heard of one. When delivering content on specific technologies, it is important to directly address top customer concerns, provide relevant resources, and use this understanding of customer interests and barriers to inform messaging and program design.
The previous survey included the possibility of sample bias, particularly from calling out energy as the survey topic while recruiting participants. This was recommended by ADM to motivate respondents to participate. This survey omitted referencing energy within the recruitment email. There was little statistically significant response variation between the two surveys to reflect that this had an effect on responses.
Conducting routine awareness surveys can help SVCE gain insight into customers’ awareness, knowledge, and attitudes towards electrification and SVCE. SVCE can leverage this knowledge to conduct meaningful and impactful outreach and communications.
The complete survey results are available in the attached Awareness Survey Summary of Findings.
STRATEGIC PLAN
Digital engagement efforts and the customer awareness survey were completed in alignment with the SVCE Strategic Plan, Goal #10: Empower customers with the awareness, knowledge and resources needed to make effective clean energy choices.
FISCAL IMPACT
The cost of survey administration was included in the FY 21-22 marketing budget. The cost of eHub administration was included in the FY 21-22 programs budget. In addition, the cost of the Granicus GovDelivery tool, ad campaign and online promotions is included in the FY 21-22 marketing budget.
ATTACHMENTS
1. Awareness Survey Summary of Findings
2. Digital Engagement and Customer Survey Results Presentation Item 7
SVCE Awareness Survey:
Summary of Findings
Submitted to:
Silicon Valley Clean Energy
Submitted on:
May 16th, 2022
Submitted by:
ADM Associates, Inc.
3239 Ramos Circle
Sacramento, CA 95827
916.363.8383
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1 Key Findings and Conclusions
Unaided recall of SVCE was considerably lower than aided recall. Ten percent cited SVCE alone and another 2% cited SVCE and PG&E when asked from whom they purchase electricity (PG&E alone was cited by 83% of customers). Some customers provided names that were similar to SVCE but not exactly correct in response to the question. For example, “Silicon Valley green” and “Silicone valley power.” Two-percent of respondents cited these alone or in conjunction with PG&E.
Respondents who mentioned PG&E but did not mention SVCE were asked a follow up question on who provides their electricity generation service. Most (74%) did not know, but 13% cited SVCE and another 2% made reference to an SVCE-like name.
Once prompted with the name SVCE, awareness was much higher. A majority of customers stated they had heard of SVCE (73%), although less than half (44%) knew that SVCE provides the electricity that they use.
Thirty-eight percent of customers were aware of the programs offered by SVCE. The best-known programs were rebates for efficient, electric appliances (34% aware), followed by for water heaters (19% aware). Fifteen percent were aware of the eHub online resource center and 12% were aware of GridShift EV Charging.
Cost and health and safety were ranked higher than convenience/performance and environmental impact when making purchase decisions. There were some differences across SEVI quartiles, with costs ranking lower in SEVI 1 than in the other SEVI quartiles and convenience/performance ranking higher in SEVI 1.
Customers are more familiar with EVs and solar/battery than with heat pump water heaters. Around 10% of customers cited the SVCE website as a source for information for EVs (10%), heat pump water heaters (13%), and for solar/battery (9%).
Cost was cited in the top 5 barriers for each technology. Technology-specific barriers that were among the top 5 barriers for each technology were as follows:
▪ EVs: Driving range and concerns about having a location to charge it. ▪ Heat pump water heaters: Not having enough information, the need to upgrade the electric system, and the reliability of the technology.
▪ Solar/battery: Not enough information, the reliability of the technology and “other” barriers.
The other barriers included the cost of the system not making economic sense, issues with the roof condition or having roof space, not being interested, and restrictions due to the residence (living in a condo or HOA restrictions).
1.1 Comparisons of 2020 and 2022 Findings
The key findings of comparisons between the 2020 and 2022 survey findings are presented below. ADM calculated the 90% confidence intervals for each estimate. The confidence intervals represent the Item 7
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variation in the estimate that may be due to chance sample variation. That is, we would expect that the population value would fall between the lower and upper bounds of the confidence interval.
When the confidence intervals from 2020 and 2022 overlap, it suggests that any apparent difference between the two values is likely due to random sampling variation, that is there is not a meaningful difference between the two years. When the confidence intervals do not overlap, it can be reasonably concluded that the differences in values are not due to random sampling variation and that there is a meaningful difference between the two years.
1.1.1 Awareness of SVCE
Aided awareness of SVCE remained unchanged between 2020 and 2022. As shown in Figure 1-1, the estimates of aided awareness were not statistically different 2020 and 2022.
Figure 1-1 2020 and 2022 Aided Awareness of SVCE
A smaller share of customers reported that they knew that SV Clean Energy provides the electricity they use in 2022 than in 2020. As shown in Figure 1-2, 59% of customers knew that 70%
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SVCE provided the electricity that they use.
Table 1-1 compares 2020 and 2022 results by SEVI quartile and as shown, the difference in reported knowledge was consistent across SEVI quartiles with no single quartile driving the difference. It’s unclear why this would be, particularly given the similarity in the share of customers who had heard of SVCE, as well as the share of customer who reported they had seen the SVCE generation charge on their bill, was similar in each year (50% reported seeing the generation charge in 2022 and 52% in 2020) Despite this difference in reported awareness, there was not a difference between 2020 and 2022 in the share of customers who reported having seen the SVCE generation charge on their bill (Figure 1-3). 59%
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Figure 1-2 2020 and 2022 Knowledge that SVCE Provides Energy they Use Table 1-1 SEVI Comparison of 2020 and 2022 Knowledge that SVCE Provides Energy they Use Knew that SV Clean Energy
provides the electricity that
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SEVI 1 SEVI 2 SEVI 3 SEVI 4 Weighted
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2022 58% 49% 45% 44% 44%
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Figure 1-3 2020 and 2022 Seen Electric Generation Charge 59%
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Beliefs about what SVCE is and does were similar in 2020 and 2022. None of the differences were statistically significant (i.e., all of the 90% CI overlapped) although 2020 responses tended to show higher levels of awareness.
1.1.2 Website Use
The share of customers who have visited the SVCE website was higher in 2022 than in 2020. Twenty-two percent of customers reported that they had visited the website as compared to 14% in 2020.1 1 There was a small change in the wording of the question in 2022 from “Before today, have you visited the SV Clean Energy website?” in 2020 to “From emails or other means, have you visited the SV Clean Energy website?” in 2022.
However, if the wording had any impact on the response, the clause “from emails or other means,” used in 2022 would likely be interpreted as a more restrictive case for visiting the website (i.e., in response to an email) and resulted in a smaller share of customers who visited the website in 2022.
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Figure 1-4 2020 and 2022 Visited Website
1.1.3 Energy Efficiency Attitudes and Awareness
Worry about personal fossil fuel use was lower in 2022 than in 2020. As shown in Figure 1-5, worry about personal fossil fuel use was lower in 2022, but extent to which customers have thought about fossil fuel use and the extent to which they feel personally responsible for climate change remained unchanged. The difference in worry about fossil fuel use may be due to more focused on other concerns in 2022 than in 2020 (e.g., continuation of Covid, inflation concerns, and armed conflict in Europe).
Figure 1-5 2020 and 2022 Climate Change and Fossil Fuel Use Attitudes Item 7
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Attitudes toward Electric Homes and Vehicles were unchanged in 2022. Figure 1-6 compares 2020 and 2022 responses. None of the differences shown were statistically significant.
Figure 1-6 2020 and 2022 Attitudes towards Electric Homes and Vehicles Views of all-electric homes were unchanged in 2022 from 2020. Figure 1-7 compares the 2020 and 2022 responses. None of the differences were statistically significant.
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Figure 1-7 2020 and 2022 Views of All Electric Homes
1.2 Survey Response and Potential Bias
Overall, at less than one percent, the survey response rate was poor. Response rates, and their decline2, have been a concern for survey researchers as they present the risk of non-response bias. However, research on survey response has found that the relationship between survey non-response and bias is complex and that there is no necessary connection between the two. Moreover, other factors such as using multiple recruitment approaches and methods can both reduce non-response bias by reaching or appealing to different segments of the population and increase response rates overall. To this end, the data collection effort for this study used best practice approaches to reduce non-response bias and increase survey response.
3 ▪ The sample was stratified by the Socio-Economic Vulnerability Index quartile to aid in collecting data from a diverse range of SVCE customers.
▪ Multiple modes were used to recruit participants, both telephone and email contact. Multiple modes is a form of varying recruitment and allowed ADM to target responses from customers who did not have email address information.
2 For example, the Pew Research Center reports that response rates have fallen from 28% in 2001 to 6% in 2018. https://www.pewresearch.org/fact-tank/2019/02/27/response-rates-in-telephone-surveys-have-resumed-their-decline/ 3 Czajka, John L. and Beyler, Amy, Declining Response Rates in Federal Surveys: Trends and Implications (Background Paper), Mathematica Policy Research Reports, Mathematica Policy Research.
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▪ The recruitment message was varied across recruitment attempts, which can improve response rates and reduce the risk of messages being blocked by spam filters.4 ▪ Incentives were provided to complete the survey, and these were increased significantly during the course of data collection to improve response rates. In addition to potentially increasing response rates, providing incentives has been found to reduce nonresponse bias.5 To assess the degree to which non-response bias may have affected the result of the survey, section 2.3 compares the characteristics of the 2022 survey sample to population demographics taken from the American Community Survey and to the 2020 survey sample. In comparison to the population, the 2022 survey respondents were:
▪ More likely to own a home (73% vs. 59%)
▪ Not identify has Hispanic (91% vs. 80%)
▪ Identify has Chinese or Taiwanese (27% vs. 11%)
▪ And a larger share made more than $200,000 a year (36% vs. 29%), while a smaller share made less than $40,000 (10% vs. 16%).
Although ADM weighted the survey responses to mitigate the effect of potential response bias, two results stand out as potentially indicating some bias in the response. Specifically, ADM estimated from the responses that 20% of SVCE customers own or lease an electric vehicle with a plug and that 21% have roof-top solar, and another 6% have roof top solar with battery storage. The results for the share of customers with an electric vehicle was similar to the share who reported this in 2020 (22% owned or leased a vehicle with a plug in that survey).6 Although we do not have data for the population to understand if these results differ significantly from the population, we note that they seem relatively high.
This result may be due to the disproportionate number of responses from homeowners and more affluent customers.
4 Dillman, D. A., Smyth, J. D., and Christian, L. M. (2009). Internet, Mail, and Mixed-Mode Surveys: The Tailored Design Method. Wiley.
5 Ibid.
6 The 2020 survey did not ask if respondents had solar panels installed.
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2 Methodology
2.1 Sample Design
The sample frame for the study was based on residential customer records provided by SVCE and was stratified by Socio-Economic Vulnerability Index (SEVI) quartile. SEVI is a measure of the relative socioeconomic characteristics of communities based on poverty, unemployment, educational attainment, linguistic isolation, and percent of income spent on housing. The SEVI quartile assignment was provided by SVCE. ADM targeted completion of 600 customers surveys (150 per SEVI quartile).
Table 2-1 summarizes the sample frame. In total, SVCE provided records for 255,794 customers. Of these records, 8,254 did not have a SEVI quartile assigned to them and were dropped from the sample frame.
Additionally, a manual review of customer contacts identified 7,406 records for which the customer name was a nonresidential entity. ADM dropped these records from the sample frame as well.
Table 2-1 Summary of Sample Frame
SEVI Quartile Total Records Nonresidential
Records Remaining Records
1 57,145 1,088 56,057
2 66,387 1,437 64,950
3 73,172 2,734 70,438
4 50,836 1,817 49,019
Not listed 8,254 330 7,924
Total 255,794 7,406 248,388
2.2 Survey Administration
ADM administered the survey online and by telephone. The survey was presented in four different languages: English, Spanish, Mandarin and Vietnamese and fielded during the period between March 25, 2022 and May 2, 2022. The methodology was the same as the methodology that was used for the 2020 survey.
Because a primary goal of the survey was to assess the unaided awareness of SVCE, the recruitment scripts made reference to the survey being conducted on behalf of a “local, public agency.” Initially, a $10 incentive was offered and this was later increased to $25 to increase the response rate. The incentive provided was a Tango Rewards card that could be redeemed for a Visa card or as a gift card to a large number of retailers. Consistent with best practice the email recruitment varied the message content and subject lines across the initial and first and second reminder emails.
2.2.1 Telephone Surveys
The telephone survey component was completed with a random sample of 1,500 contacts without email addresses who lived in a SEVI 4 area. Customers were contacted to compete the survey up to two times.
Spanish speaking customers were tracked and re-contacted at a later point to complete the survey.
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2.2.2 Online Surveys
The online survey component was completed with random samples of customers. All emails sent to customers were in English, Spanish, Mandarin, and Vietnamese.
2.2.3 Summary of Response
Table 2-2 summarizes the response to the survey. Overall, the response was considerably lower than hoped for. However, among those who began the survey, 63% completed it. The biggest barriers to obtaining survey response appear to be willingness to attempt the survey or respond to telephone calls.
The incentive level did not have a discernable impact on the response rate.
As shown in the table below, the incentive amount did not have an effect on the response rate.
Additionally, 81% of the emails sent were not opened, suggesting that most emails were not viewed.
Table 2-2 Summary of Survey Response
Incentive Contacts Email
Bounce
Email
Opened
Survey Not
Started
Survey
Started
Unfinished
Survey
Finished
Completion
Rate
Completion
Rate Among
Survey Starters
Email $10 71,948 2,941 17,421 222 363 0.5% 62.1%
Email $25 28,756 1,290 5,106 57 113 0.4% 66.5%
Telephone 1,500 n/a n/a n/a 5 0.3% n/a
Total 100,704 4,231 22,527 279 481 0.5% 62.6%
Although the response rate was low, the sample of respondents included speakers of all four languages it was administered in (see Table 2-3). While most surveys were completed in English, surveys were also completed in Chinese, Spanish, and Vietnamese.
Table 2-3 Language Survey was Completed In
Survey Language Survey Completions Percent of Survey
Completions
English 434 90%
Chinese 32 7%
Spanish 13 3%
Vietnamese 2 < 1%
Total 481 100%
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2.3 Customer Population and Survey Sample
This section presents summary information on the characteristic of the sample and population. For comparison purposes, characteristics of the 2020 population are included as well.7
2.3.1 SEVI Quartile
The table below summarizes the number of survey responses obtained by SEVI quartile.
Table 2-4 Number of Survey Responses
SEVI Quartile
Total
Residential
Customers
(2022)
Number of
Responses
(2022)
Number of
Responses
(2020)
SEVI 1 56,057 117 167
SEVI 2 64,950 130 169
SEVI 3 70,438 129 163
SEVI 4 49,019 105 154
Total 240,464 481 653
2.3.2 Geographic Distribution of Respondents
Figure 2-1 displays the distribution of customers as compared to survey respondents. As shown the sample was generally representative of the geographic distribution of customers. The 2022 sample appears to be somewhat more representative of the geographic distribution of customers than the 2020 sample. As shown, the percent of respondents more closely aligned with the distribution of survey responses in 2022 than in 2020.
7 Population characteristics are based on the Public Use Microdata Sample person and household files for the 2016 – 2020 American Community Survey (ACS) 5-Year estimates. The ACS uses Public Use Microdata Areas (PUMAs) as the geographic identifier. ADM used the Missouri Census Data Center Geocorr tool to map PUMA responses to zip codes served by SVCE and taken from the customer data file provided to develop the survey sample frame.
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Figure 2-1 Distribution of Customers Compared to Distribution of Survey Respondents Table 2-5 summarizes the distribution of customers by city and SEVI quartile and Table 2-6 summarizes the distribution of survey respondents by city and SEVI quartile.
Table 2-5 Distribution of SVCE Customers by City and SEVI Quartile Premise City SEVI 1 SEVI 2 SEVI 3 SEVI 4 Total
CAMPBELL 40% 19% 37% 3% 16,554
CUPERTINO 3% 65% 32% 0% 21,017
GILROY 20% 7% 22% 52% 15,367
LA HONDA 100% 0% 0% 0% 4
LOS ALTOS 97% 1% 2% 0% 12,496
LOS ALTOS HILLS 100% 0% 0% 0% 2,886
LOS GATOS 83% 12% 5% 0% 16,438
MILPITAS 0% 7% 46% 47% 25,461
MONTE SERENO 100% 0% 0% 0% 594
MORGAN HILL 0% 49% 21% 30% 16,722
MOUNT HAMILTON 0% 50% 0% 50% 4
MOUNTAIN VIEW 20% 33% 28% 19% 31,981
PALO ALTO 100% 0% 0% 0% 2
PORTOLA VALLEY 100% 0% 0% 0% 32
REDWOOD ESTATES 100% 0% 0% 0% 175
SAN JOSE 3% 20% 26% 51% 10,026
SAN MARTIN 0% 0% 98% 1% 1,806
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Premise City SEVI 1 SEVI 2 SEVI 3 SEVI 4 Total
SARATOGA 45% 55% 0% 0% 11,035
STANFORD 93% 0% 0% 7% 917
SUNNYVALE 7% 29% 43% 21% 56,915
WATSONVILLE 0% 100% 0% 0% 32
Table 2-6 Distribution of Survey Respondents by City and SEVI Quartile Premise City SEVI 1 SEVI 2 SEVI 3 SEVI 4 Total
CAMPBELL 28% 16% 53% 3% 32
CUPERTINO 0% 76% 24% 0% 38
GILROY 21% 0% 21% 59% 29
LA HONDA 0% 0% 0% 0% 0
LOS ALTOS 94% 3% 3% 0% 32
LOS ALTOS HILLS 100% 0% 0% 0% 5
LOS GATOS 79% 21% 0% 0% 28
MILPITAS 0% 0% 51% 49% 47
MONTE SERENO 100% 0% 0% 0% 1
MORGAN HILL 0% 52% 24% 24% 25
MOUNT HAMILTON 0% 0% 0% 0% 0
MOUNTAIN VIEW 25% 35% 19% 21% 75
PALO ALTO 0% 0% 0% 0% 0
PORTOLA VALLEY 0% 0% 0% 0% 0
REDWOOD ESTATES 0% 0% 0% 0% 0
SAN JOSE 0% 30% 13% 57% 23
SAN MARTIN 0% 0% 100% 0% 1
SARATOGA 70% 30% 0% 0% 20
STANFORD 100% 0% 0% 0% 1
SUNNYVALE 8% 30% 39% 23% 124
WATSONVILLE 0% 0% 0% 0% 0
2.3.3 Home Demographic Characteristics
Table 2-7 through Table 2-11 compare the population estimate to the 2022 and 2020 unweighted sample estimates on home and demographic characteristics. Overall, the samples in both years are similar and align with the population estimates. That said, the samples differ from the population in the following ways.
▪ Homeowners were over-represented in both samples and to a greater degree in the 2022 sample. Homeowners were over-represented by 14% in the 2022 sample and 6% in the 2020 sample.
▪ Customers who live in an apartment were somewhat underrepresented in the 2022 sample by seven percentage points.
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▪ Hispanics were underrepresented in both the 2022 and 2020 samples by about 10 percentage points.
▪ Respondents who identified as Chinese or Taiwanese were over-represented in the 2022 sample by 16 percentage points. This is likely related to the finding that seven percent of the surveys were completed in Chinese.
Table 2-7 Home Ownership Sample and Population Comparison Home Ownership
2020 American
Community Survey
5-Year Estimate
Unweighted 2022
Sample
Unweighted 2020
Sample
Own 59% 73% 65%
Do not own 41% 27% 35%
Table 2-8 Home Type Sample and Population Comparison
Home Type
2020 American
Community Survey
5-Year Estimate
Unweighted 2022
Sample
Unweighted 2020
Sample
Mobile home 3% 2% 1%
Single family detached 57% 61% 59%
Single family attached 11% 15% 13%
Apartment 29% 22% 25%
Table 2-9 Hispanic Identity Sample and Population Comparison Hispanic Identity
2020 American
Community Survey
5-Year Estimate
Unweighted 2022
Sample
Unweighted 2020
Sample
Not Hispanic 80% 91% 89%
Hispanic 20% 9% 11%
Table 2-10 Race and Ethnic Sample and Population Comparison Race/Ethnic
Identification
2020 American
Community Survey
5-Year Estimate
Unweighted 2022
Sample
Unweighted 2020
Sample
White 51% 48% 46%
Chinese/Taiwanese 11% 27% 14%
Vietnamese 5% 3% 2%
Indian/Pakistani 9% 6% 7%
Other Asian 8% 4% 3%
Other 16% 12% 28%
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Table 2-11 Income Sample and Population Comparison
Income
2020 American
Community Survey
5-Year Estimate
Unweighted 2022
Sample
Unweighted 2020
Sample
< 40,000 16% 10% 12%
40,001 - 65,001 11% 9% 8%
65,001 - 95,000 12% 10% 11%
95,001 - 150,000 20% 19% 18%
150,001 - 200,000 13% 17% 16%
>200,000 29% 36% 35%
2.4 Development of Sample Weights
ADM weighted the survey data to develop overall customer statistics. A two-step procedure was used to develop the sample weights. In the first step, ADM calculated the normalized design weights for each SEVI quartile. The calculation of the design weights was as follows:
𝑊𝑁 =
𝑁ℎ
𝑛ℎ
⁄ ∗
𝑛⁄𝑁
Where,
𝑊𝑁 is the normalized design weight,
𝑁ℎ is the number of customers for the SEVI quartile,
𝑛ℎ is the number of customers for the SEVI quartile that completed the survey, 𝑛 is the total number of customers that completed the survey, and 𝑁 is the total number of customers in the sample frame.
The second step in calculating the response weights was to apply a poststratification adjustment based on respondent reported demographics and population totals developed from the American Community Survey 2020 five-year estimates. The estimates were based on zip codes served by SVCE.
The specific characteristics included in the development of post-stratification weights were:
▪ Hispanic identification,
▪ Income,
▪ Home ownership,
▪ Race/Ethnicity, and
▪ Household size.
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Because the poststratification adjustment for population targets that comprise a small share of the population can be unstable, we grouped race/ethnicity, and household size into smaller sets of categories that comprised at least 5% of the SVCE population.
ADM used raking to develop the poststratification weights. This procedure iteratively adjusts the design weights so that they match the selected population totals.
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3 Summary Findings
The following presents findings from the second awareness survey administered to Silicon Valley Clean Energy (SVCE) customers during the period between March 25, 2022 and May 2, 2022.
The results presented by SEVI quartile are unweighted responses. The weighted average presents summary statistics using the weights developed as described in section 0.
For the comparisons of SEVI groups, ADM performed tests of statistical significance to determine if observed differences in averages were due to sampling variation or if they reflected differences in the SEVI populations.8 Cases where the differences were statistically different are noted with an asterisk in the tables below and discussed in the text.
3.1 Awareness of SVCE
Unaided recall of SVCE was fairly low. Relatively few SVCE customers cited SVCE as the provider of their electricity. Ten percent cited SVCE alone and another 2% cited SVCE and PG&E. Some customers provided names that were similar to SVCE but not exactly correct, for example, “Silicon Valley green” and “Silicone valley power.” Two-percent of respondents cited these alone or in conjunction with PG&E.
Table 3-1Unaided Recall of Electricity Supplier
Metric SEVI 1 SEVI 2 SEVI 3 SEVI 4 Weighted
Average
PG&E 74% 79% 84% 84% 83%
SVCE 17% 14% 9% 10% 10%
PG&E/SVCE 4% 1% 2% 1% 2%
SVCE-Close 2% 1% 3% 2% 1%
PG&E/SVCE-Close 0% 2% 1% 0% 1%
Santa Clara Utilities 0% 1% 0% 0% 0%
Soniva 0% 1% 0% 0% 0%
Renewable provider 0% 1% 0% 0% 0%
Arcadia Power 0% 1% 0% 0% 0%
No 0% 0% 0% 1% 0%
Other 3% 1% 1% 3% 2%
Note: SVCE-close refers to mentions of names that were similar to SVCE but not accurate. For example, Silicon Valley green and Silicone valley power.
8 Either a chi-square test of independence (for categorical data), one-way analysis of variance (ANOVA) (for continuous data), or a Kruskal-Wallis rank sum test (for ordered categorical data) were used to test for statistically significant differences in average responses across SEVI groups.
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Respondents who mentioned PG&E but did not mention SVCE (n = 398) were asked a follow up question on who provides their electricity generation service. Most (74%) did not know, but 13% cited SVCE and another 2% made reference to an SVCE-like name.
Table 3-2 Who Provides Your Electricity Generation Service Metric SEVI 1 SEVI 2 SEVI 3 SEVI 4 Weighted
Average
Does not know who provides electricity generation
service 71% 65% 73% 73% 74%
SVCE 15% 19% 11% 13% 13%
PG&E 9% 10% 10% 11% 9%
SVCE-Close 2% 3% 3% NA 2%
Other 2% 3% 4% 3% 2%
Once prompted with the name SVCE, awareness was much higher. A majority of customers have heard of SVCE (73%), although less than half (44%) knew that SVCE provides the electricity that they use.
Majorities of customers believed that SVCE is a community-owned not-for-profit (69%), that its rates are lower than PG&E (62%), and that it provides electricity exclusively from renewable and clean energy sources (78%). Few customers (23%) believed SVCE to be a part of PG&E.
Table 3-3 Awareness and Understanding of SVCE
Metric SEVI 1 SEVI 2 SEVI 3 SEVI 4 Weighted
Average
Heard of Silicon Valley Clean Energy before this
survey
85% 78% 71% 73% 73%
Knew that SV Clean Energy provides the electricity
that they use 58% 49% 45% 44% 44%
SV Clean Energy is a community-owned, not-for-profit, public agency 79% 71% 67% 64% 69% SV Clean Energy electricity rates are lower
than PG&E rates 67% 63% 62% 64% 62%
SV Clean Energy provides electricity
exclusively from renewable and clean energy
sources
71% 82% 79% 79% 78%
SV Clean Energy is a company, division, or
branch of PG&E 14% 15% 20% 27% 23%
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Table 3-4 Awareness and Understanding of SVCE (2020 Survey) Metric SEVI 1 SEVI 2 SEVI 3 SEVI 4 Weighted
Average
Heard of Silicon Valley Clean Energy before this
survey
76% 71% 71% 68% 70%
Knew that SV Clean Energy provides the
electricity that they use 68% 60% 61% 56% 59%
SV Clean Energy is a community-owned, not-for-profit, public agency 83% 68% 70% 72% 72% SV Clean Energy electricity rates are lower
than PG&E rates 61% 63% 68% 68% 65%
SV Clean Energy provides electricity
exclusively from renewable and clean energy
sources
85% 83% 80% 90% 86%
SV Clean Energy is a company, division, or
branch of PG&E 9% 18% 18% 30% 24%
*Indicates statistically significant difference across all groups at the p < .05 level.
Overall, the understanding and awareness metrics were similar in 2022 as compared to 2021 (see Table 3-5). Surprisingly, a smaller share of customers in 2022 knew that SVCE provides the electricity that they use. It’s unclear why this would be, particularly given the similarity in the share of customers who had heard of SVCE found in each of the surveys, as well as the similarity in the share of customer who reported they had seen the SVCE generation charge on their bill was similar in each year (50% in 2022 and 52% in 2020).
Table 3-5 Awareness 2020 and 2022 Comparison
Metric
2020
Weighted
Average
2022
Weighted
Average
Heard of Silicon Valley Clean Energy before this survey 70% 73% Knew that SV Clean Energy provides the electricity that they use 59% 44% SV Clean Energy is a community-owned, not-for-profit, public agency
72% 69%
SV Clean Energy electricity rates are lower than PG&E rates 65% 62% SV Clean Energy provides electricity exclusively from renewable and clean energy sources 86% 78%
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3.2 Communication Awareness and Preference
A moderate share of customers have seen the SVCE generation charge or recall getting email or postal mail communications. As shown below, 50% stated they have seen the SVCE generation charge and 38% received emails or postal mail from SV Clean Energy. The share that have seen the generation charge was comparable to the share who reported that in 2020 (52%, not shown).
Table 3-6 SVCE Information Seen
Information Seen About SV Clean Energy SEVI 1 SEVI 2 SEVI 3 SEVI 4 Weighted Average
Has seen the SV Clean Energy Electric Generation charge on electricity bill 56% 55% 49% 51% 50%
Received emails or postal mail from SV Clean Energy 47% 46% 36% 44% 38% Table 3-7 Has seen the SVCE Generation Charge (2020 Survey) Information Seen About SV Clean Energy SEVI 1 SEVI 2 SEVI 3 SEVI 4 Weighted Average
Has seen the SV Clean Energy Electric Generation charge on electricity bill 57% 55% 53% 52% 52%
Customers prefer to receive SVCE communications via email (63%) and with their energy bills (55%), followed by postal mail (44%). As shown in the table below, social media and traditional media advertisements were less frequently preferred. Note, percentages sum to more than 100% because respondents could select multiple options.
Table 3-8 Preferred Communication Modes
Preferred Mode of Communication SEVI 1 SEVI 2 SEVI 3 SEVI 4 Weighted Average
Email 71% 70% 61% 54% 63%
With energy bill 54% 57% 57% 57% 55%
Postal mail 43% 47% 42% 39% 44%
Facebook post 2% 5% 6% 11% 8%
Local television station advertisement 6% 5% 5% 9% 7%
Nextdoor post 9% 8% 6% 5% 6%
Video streaming advertisement (such as YouTube
or Hulu) 4% 5% 6% 4% 5%
Newspaper 5% 3% 6% 7% 4%
Radio advertisements 1% 2% 3% 6% 3%
Instagram post 1% 3% 2% 1% 2%
Twitter post 1% 1% 1% 3% 1%
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3.3 Awareness of SVCE Programs
Approximately one-third (38%) of customers reported awareness of any of the listed programs and services offered by SVCE. Awareness was highest for efficient appliance rebates (34% aware) and lowest for the Education Fund grants and Empower Silicon Valley Competition (9%). Fifteen-percent of respondents were aware of the eHub online resource center.
Table 3-9 Awareness of Programs and Services
Metric SEVI 1 SEVI 2 SEVI 3 SEVI 4 Weighted
Average
Awareness of any program 50% 42% 40% 38% 38%
eHub, online resource center 19% 16% 9% 20% 15%
Rebates for efficient, electric appliances 46% 36% 36% 34% 34% Heat Pump Water Heater rebate 21% 25% 17% 20% 19%
GridShift EV Charging 14% 15% 10% 15% 12%
Education Fund grants or the Empower Silicon Valley
Film Competition 8% 13% 5% 12% 9%
3.4 Use of SVCE Website
Approximately one-fifth of respondents (22%) had visited the SVCE website. In comparison, 14% had visited the website in 2020. This difference was statistically significant.
There was a statistically significant difference in the share of customers that visited the website across SEVI quartiles, with customers in the more affluent SEVI 1 and SEVI 2 quartiles reporting that they visited the website at a higher rate than those in SEVI 3 and SEVI 4.
Table 3-11 provides the share of customers who visited the website from the 2020 survey by SEVI quartile.
The differences within SEVI quartile (e.g., a comparison of 2020 and 2022 findings for SEVI 1) were not statistically significant. However, the increase was consistent across SEVI 1 – 3 (increases of eight to nine percentage points), but a somewhat smaller for SEVI 4 (a three-percentage point increase.) The most common reasons for visiting the website were to view electric rates or learn about energy programs.
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Table 3-10 Use of SVCE Website
Metric SEVI 1 SEVI 2 SEVI 3 SEVI 4 Weighted
Average
Visited website* 34% 27% 19% 21% 22%
Reason for visiting website
Learn more about efficient, electric
appliances 53% 59% 42% 50% 52%
Review electric rates 63% 62% 33% 45% 51%
Learn more about solar and batteries 28% 32% 38% 27% 32% Learn more about electric vehicles 28% 26% 25% 27% 27%
Learn more about financial assistance
programs
10% 21% 4% 27% 18%
Another reason 20% 24% 25% 9% 18%
*Indicates statistically significant difference across all groups at the p < .05 level.
Table 3-11 Visited Website (2020 Survey)
Metric SEVI 1 SEVI 2 SEVI 3 SEVI 4 Weighted
Average
Visited website* 25% 19% 10% 18% 14%
*Indicates statistically significant difference across all groups at the p < .05 level.
3.5 Attitudes towards Electrification and Climate
On average, customers displayed a moderate level of concern about their fossil fuel use. As shown the average ratings on the 0 – 10 scale were between 5.9 and 6.8. Customers in SEVI 1 tended to think about their fossil fuel use to a greater extent than customers in the less affluent regions. Overall, fossil fuel attitudes were similar in 2020 and 2022, although the level of worry about fossil fuel use was lower in 2022 than in 2021.
Table 3-12 Fossil Fuel Attitudes
Fossil Fuel Attitude SEVI 1 SEVI 2 SEVI 3 SEVI 4 Weighted Average
Extent to which feels personally responsible for
climate change 6.6 6.9 6.2 6.8 6.8
Extent to which has thought about their fossil fuel
use* 7.2 6.5 5.9 5.7 6.2
Extent to which worried about our use of fossil fuels 5.5 5.9 5.7 5.5 5.9 *Indicates statistically significant difference across all groups at the p < .05 level.
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Table 3-13 Fossil Fuel Attitude 2020 and 2022 Comparison Fossil Fuel Attitude
2020
Weighted
Average
2022
Weighted
Average
Extent to which feels personally responsible for climate change 7.0 6.8 Extent to which has thought about their fossil fuel use 6.0 6.2 Extent to which worried about our use of fossil fuels 6.7 5.9 Most customers agreed that there were environmental and safety benefits to electrified heating and vehicles. In particular, 77% of customers thought that driving an electric vehicle was better for the environment. Electric heating at home was also perceived as better for the environment by 57% of customers and as safer by 65%. The ratings provided were similar in 2020 and 2022.
Table 3-14 Electrification Attitudes
Strongly or somewhat agrees that… SEVI 1 SEVI 2 SEVI 3 SEVI 4 Weighted Average
Driving an electric vehicle is better for the
environment than using a standard gas vehicle. 75% 79% 74% 71% 77% Using electricity to heat your home is better for
the environment than using natural gas to heat
your home.
54% 61% 49% 55% 57%
Using electricity to heat your home is safer than
using natural gas to heat your home. 64% 68% 63% 64% 65% Table 3-15 Electrification Attitude 2020 and 2022 Comparison Strongly or somewhat agrees that…
2020
Weighted
Average
2022
Weighted
Average
Driving an electric vehicle is better for the environment than using a standard gas vehicle. 81% 77%
Using electricity to heat your home is better for the environment than using natural gas to heat your home. 54% 57%
Using electricity to heat your home is safer than using natural gas to heat your home. 61% 65%
Beliefs about electric homes were generally positive and consistent across 2020 and 2022. A clear majority (73%) of customers believed that all electric homes improve indoor and outdoor air quality, but they were split as to whether or not they were more energy efficient (53% thought they were). Sixty-one percent thought they were expensive.
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Table 3-16 Beliefs about All Electric Homes
Beliefs about All-Electric Homes SEVI 1 SEVI 2 SEVI 3 SEVI 4 Weighted Average
All-electric homes are more energy efficient 42% 58% 46% 59% 53% All-electric homes are expensive 55% 58% 61% 66% 61%
All-electric homes improve indoor and outdoor air
quality 75% 80% 67% 77% 73%
Table 3-17 Beliefs about All Electric Homes 2020 and 2022 Comparison Beliefs about All-Electric Homes
2020
Weighted
Average
2022
Weighted
Average
All-electric homes are more energy efficient 52% 53%
All-electric homes are expensive 62% 61%
All-electric homes improve indoor and outdoor air
quality 75% 73%
3.6 Purchasing Priorities and Likelihood of Purchases
Cost and health and safety were the most important factors considered when making purchases. Table 3-18 summarizes the average ranking of importance of four factors when making purchases. In the table, larger numbers indicate greater importance of the factor in decision. Cost and health and safety were most important.
Costs were more important for individuals in SEVI 4 and 3 than for those in more affluent areas.
Conversely, convenience and performance were more important for respondents in more affluent areas.
Environmental impacts were least important and largely the same across groups.
Table 3-18 Ranked Importance
Average Rank SEVI 1 SEVI 2 SEVI 3 SEVI 4 Weighted
Average
Cost* 2.5 2.8 2.9 3.0 2.9
Health and safety 2.7 2.7 2.9 2.9 2.8
Convenience/performance* 2.8 2.6 2.4 2.3 2.4
Environmental impacts 1.9 1.9 1.9 1.9 1.9
*Indicates statistically significant difference across all groups at the p < .05 level.
Note: Responses recoded so that factors ranked higher have larger values.
Smart thermostats, home EV chargers, induction cook tops were the three most commonly mentioned purchases. Nearly half of customers (48%) did not plan on purchasing any of the listed items in the next three years. Customers in SEVI 2 and SEVI 3 were more likely to purchase a heat pump heating and cooling system than those in SEVI 1 or SEVI 4.
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Table 3-20 shows the likelihood of purchases for renters and owners. Overall, owners were more likely to purchase one or more of the listed items and owners were more likely to purchase a heat pump system and electric yard and garden equipment.
Table 3-19 Likely Purchases
Likely Purchases in the Next Three
Years SEVI 1 SEVI 2 SEVI 3 SEVI 4 Weighted Average
None of these 44% 39% 46% 50% 48%
Smart thermostat 16% 25% 18% 19% 21%
Home energy audit or evaluation 9% 13% 12% 10% 10%
Induction cooktop 15% 22% 18% 14% 17%
Heat pump heating and cooling system* 9% 20% 17% 12% 13% Home EV charger 19% 24% 26% 15% 20%
Electric yard and garden equipment 17% 14% 9% 11% 12%
*Indicates statistically significant difference across all groups at the p < .05 level.
Table 3-20 Likely Purchases by Home Ownership
Likely Purchases in the Next Three
Years Owners Renters
None of the above* 40% 59%
Smart thermostat 21% 23%
Home energy audit or evaluation 12% 8%
Induction cooktop 17% 18%
Heat pump heating and cooling system* 18% 6%
Home EV charger 23% 16%
Electric yard and garden equipment* 17% 5%
*Indicates statistically significant difference across all groups at the p < .05 level.
3.7 Awareness and Interest in Specific Technologies
3.7.1 Electric Vehicles
Most customers own or have some level of interest in an electric vehicle. Nineteen percent of respondents reported that they own an electric vehicle (compared to 20% in the 2020 survey).
Additionally, 27% reported they have considered buying one and 31% said they were interested in one but had not considered buying.
Electric vehicle ownership rates were higher in SEVI 1.
Table 3-21 Awareness of Electric Vehicles
Awareness of Electric Vehicles* SEVI 1 SEVI 2 SEVI 3 SEVI 4 Weighted Average
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I already own one 35% 24% 22% 11% 19%
I am interested in one and have considered buying
one
28% 28% 29% 23% 27%
I am interested in one, but have not considered
buying one 22% 29% 29% 38% 31%
I have heard of them, but am not interested in one 16% 18% 17% 27% 21% I have not heard of them 0% 0% 2% 1% 2%
*Indicates statistically significant difference across all groups at the p < .05 level.
Friends or family, automotive media, and the news were the common sources of information on electric vehicles. Respondents in SEVI 4 areas were less likely to indicate automotive media sources were sources of information on electric vehicles.
Ten percent of respondents cited the SV Clean Energy website as a source of information on electric vehicles.
Table 3-22 Sources Used to Learn about Electric Vehicles Sources Used to Learn about Electric
Vehicles SEVI 1 SEVI 2 SEVI 3 SEVI 4 Weighted Average
Friend or family 53% 54% 46% 50% 51%
Automotive media such as magazines, websites,
YouTube channels, television shows, or blogs*
54% 57% 51% 35% 45%
News 46% 53% 51% 44% 44%
Social media such as Facebook or Instagram 12% 20% 16% 17% 17% Dealerships 16% 19% 17% 13% 15%
I have not used any sources of information to learn
about electric vehicles. 10% 5% 10% 13% 12%
SV Clean Energy website (including the EV
Assistant online tool) 14% 9% 6% 10% 10%
Community workshops 4% 2% 2% 4% 4%
Other 10% 11% 10% 8% 9%
*Indicates statistically significant difference across all groups at the p < .05 level.
Nearly half of respondents (46%) were extremely or very likely to purchase an electric vehicle for their next vehicle. Twenty five percent were unlikely to purchase an electric vehicle.
Table 3-23 Likelihood of Purchasing Electric Vehicle for Next Vehicle Purchase Likelihood of Choosing Electric Vehicle for
Purchase SEVI 1 SEVI 2 SEVI 3 SEVI 4 Weighted Average
Extremely or very likely 50% 48% 45% 42% 46%
Somewhat likely 26% 29% 29% 30% 30%
Not so / not at all likely 24% 22% 25% 28% 25%
Driving range, cost, and concerns about charging were the biggest barriers to purchasing an electric vehicle. Fifty-four percent of customers were concerned about the driving range of an electric vehicle and Item 7
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49% mentioned the cost as a concern. Thirty-one percent were worried about not having a place to charge their vehicle at home.
Table 3-24 Barriers to Electric Vehicle Purchases
Barriers to Electric Vehicle Purchase SEVI 1 SEVI 2 SEVI 3 SEVI 4 Weighted Average
Driving range of the vehicle 62% 61% 56% 48% 54%
Cost of purchasing or leasing an electric vehicle 41% 51% 50% 49% 49% Not having a place to charge the vehicle at my
home 21% 24% 28% 32% 31%
Not knowing where I can charge it away from my
home 34% 28% 30% 21% 26%
Cost of operating an electric vehicle including
electricity costs 14% 15% 20% 21% 19%
Concern about the safety of electric vehicle battery
systems
16% 15% 14% 23% 16%
Not enough models or styles to choose from* 26% 12% 13% 11% 13% Reliability of the technology 13% 10% 9% 13% 12%
Don’t know enough information about electric
vehicles* 4% 3% 2% 12% 6%
Unable to find one for sale 4% 7% 4% 3% 4%
Other 11% 12% 16% 13% 11%
*Indicates statistically significant difference across all groups at the p < .05 level.
3.7.2 Heat Pump Water Heaters9
Few homeowners have a heat pump water heater and a quarter have not heard of them. As shown below, 7% of homeowners have a heat pump water heater. Additionally, the share that have considered buying one was 15%.
Table 3-25 Awareness of Heat Pump Water Heaters
Awareness of Efficient Heat Pump Water
Heaters SEVI 1 SEVI 2 SEVI 3 SEVI 4 Weighted Average
I already own one 10% 8% 8% 2% 7%
I am interested in one and have considered buying
one
13% 14% 15% 15% 15%
I am interested in one, but have not considered
buying one 29% 37% 33% 24% 31%
I have heard of them, but I am not interested in
one
28% 19% 27% 24% 23%
I have not heard of them 20% 22% 18% 35% 24%
9 The responses to questions about heat pump water heaters are limited to respondents who stated they owned their own home (unweighted n = 331).
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Do it yourself or home renovation media was the most common source of information on heat pump water heaters (cited by 30%) followed by the news (cited by 23%). Thirteen percent of customers cited the SVCE website and appliance assistance tool as a source for information. Customers in SEVI 2 were more likely to cite family and friends as a source of information.
Table 3-26 Sources of Information Used to Learn about Heat Pump Water Heaters Sources Used to Learn about Heat Pump
Water Heaters SEVI 1 SEVI 2 SEVI 3 SEVI 4 Weighted Average I have not used any sources of information to
learn about heat pump water heaters. 40% 28% 30% 24% 30% Do it yourself or home renovation media such as
magazines, websites, YouTube channels, television
shows, or blogs
31% 33% 25% 32% 30%
News 19% 29% 25% 21% 23%
Friend or family* 11% 27% 17% 13% 18%
SV Clean Energy website (including the Appliances
Assistant online tool) 15% 11% 10% 18% 13%
Contractor 10% 9% 10% 5% 9%
Plumber 9% 9% 5% 8% 8%
Social media such as Facebook or Instagram 0% 9% 8% 11% 8% Community workshops 5% 4% 5% 5% 6%
Electrician 5% 5% 3% 5% 4%
Other 6% 8% 8% 3% 6%
*Indicates statistically significant difference across all groups at the p < .05 level.
One third of customers reported that they were extremely or very likely to choose a heat pump water heater. Sixteen percent that they were not likely to choose one.
Cost of purchase and cost of electricity to heat water were the most commonly cited barriers. Fifty-two percent cited cost of installation and 37% cited cost of the electricity. Another one-third did not know enough information about them and 31% of customers saw the need to upgrade their electric system as a barrier.
Table 3-27 Likelihood of Choosing a Heat Pump Water Heater Likelihood of Choosing Heat Pump Water
Heater SEVI 1 SEVI 2 SEVI 3 SEVI 4 Weighted Average
Extremely or very likely 31% 39% 36% 39% 37%
Somewhat likely 48% 41% 50% 52% 47%
Not so / not at all likely 21% 20% 14% 9% 16%
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Table 3-28 Barriers to Water Heater Purchase
Barriers to Heat Pump Water Heater
Purchase SEVI 1 SEVI 2 SEVI 3 SEVI 4 Weighted Average
Cost of purchase and installation 44% 50% 65% 46% 52%
Cost of electricity to heat water 37% 31% 44% 38% 37%
Don’t know enough information 39% 31% 35% 27% 33%
Need to upgrade electric system such as add an
outlet, upgrade electric panel* 32% 41% 28% 22% 31%
Reliability of the technology 11% 11% 13% 22% 14%
Not enough available models 8% 4% 7% 3% 6%
Can’t find a contractor who will install one 4% 3% 4% 5% 5% Does not work for my property or I do not own
my home 6% 1% 6% 5% 4%
Other 13% 21% 6% 16% 14%
*Indicates statistically significant difference across all groups at the p < .05 level.
3.7.3 Solar/Battery10
Awareness of solar with battery is high. Four percent of customers said that they had not heard of solar with battery. Twenty-one percent said they had solar without battery and 6% have battery with storage.
Twenty-one percent said they have considered installing a solar/battery system.
Table 3-29 Awareness of Solar Paired with Battery
Awareness of Rooftop Solar Paired with
Battery Storage SEVI 1 SEVI 2 SEVI 3 SEVI 4 Weighted Average I already own a rooftop solar system without
battery storage 28% 15% 22% 21% 21%
I already own a rooftop solar system with battery
storage
5% 7% 4% 7% 6%
I am interested in rooftop solar with battery and
have considered installing a system 20% 26% 24% 11% 21% I am interested in rooftop solar with battery, but
have not considered installing a system 20% 28% 31% 28% 26% I have heard of it, but I am not interested in
rooftop solar with battery 26% 18% 18% 30% 21%
I have not heard of rooftop solar with battery 2% 7% 1% 4% 4% News, friends and family, and do it yourself or home renovation media were the most common sources of information. Each of those were sources for about one-third of customers. In comparison, 9% of customers cited the SVCE website/solar+battery tool.
10 The responses to questions about solar and battery are limited to respondents who stated they owned their own home (unweighted n = 331).
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Table 3-30 Sources of Information on Solar and Battery Storage Sources Used to Learn about Solar and
Battery Storage SEVI 1 SEVI 2 SEVI 3 SEVI 4 Weighted Average I have not used any sources of information to
learn about solar and battery storage. 14% 13% 16% 11% 13% News 40% 36% 39% 42% 38%
Friend or family 35% 39% 34% 33% 37%
Do it yourself or home renovation media such as
magazines, websites, YouTube channels,
television shows, or blogs
41% 36% 31% 27% 35%
Contractor* 27% 20% 10% 15% 20%
Social media such as Facebook or Instagram 8% 12% 7% 18% 11% SV Clean Energy website (including the Solar +
Battery Assistant online tool)* 12% 9% 1% 16% 9%
Community workshops 3% 3% 7% 5% 6%
Electrician 9% 6% 0% 7% 5%
Plumber 3% 1% 0% 4% 1%
Other 13% 17% 14% 9% 14%
*Indicates statistically significant difference across all groups at the p < .05 level.
The likelihood of installing solar and battery or adding battery to solar were not very high. Sixteen percent of customers with solar already said they were extremely or very likely to add battery storage and the same share without solar said they would add battery with solar. As shown in Table 3-33, cost of the systems were the biggest barriers to installation. A large share of respondents cited “other” factors. These comments were content-coded and summarized in Table 3-34. The most common of these comments were that solar did not make economic sense, that their roof was damaged or lacked space, they were just not interested, or faced restrictions due to their HOA or because they live in a condominium.
Table 3-31 Likelihood of Installing Solar with Battery
Likelihood of Installing Solar with Battery
Storage SEVI 1 SEVI 2 SEVI 3 SEVI 4 Weighted Average
Extremely or very likely 15% 19% 22% 4% 16%
Somewhat likely 37% 33% 27% 48% 36%
Not so / not at all likely 49% 48% 51% 48% 48%
Table 3-32 Likelihood of Adding Battery to Solar
Likelihood of Adding Battery to Solar SEVI 1 SEVI 2 SEVI 3 SEVI 4 Weighted Average
Extremely or very likely 21% 13% 19% 17% 16%
Somewhat likely 29% 53% 44% 42% 45%
Not so / not at all likely 50% 33% 38% 42% 39%
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Table 3-33 Barriers to Installation of Solar and Battery Barriers to Solar and Battery SEVI 1 SEVI 2 SEVI 3 SEVI 4 Weighted Average
Cost of purchase and installation of battery 64% 62% 50% 45% 66% Cost of purchase and installation of solar 60% 57% 47% 47% 64% Don’t know enough information 16% 19% 13% 15% 16%
Reliability of the technology 14% 17% 10% 11% 15%
Does not work for my property or I do not own
my home 14% 19% 35% 34% 7%
Other 19% 19% 18% 23% 22%
Table 3-34 Coded Open Ended “Other” Barriers
Barriers Mentioned Number of Responses
Does not make economic sense 15
Roof damaged / roof space 7
Not interested 6
HOA/Live in condo 5
Other 4
Shaded roof/home orientation 4
Appearance 3
Possible loss of net metering / rate plan 3
Space for battery 3
Wrong type of roof 3
Pair with roof replacement 1
Battery life 1
Leased solar doesn't allow battery 1
SVCE clean energy option is better 1
PG&E connection fee 1
Lack of information on costs/benefits 1
Regulations/permitting issues 1
Wait until purchase of EV 1
Batteries not available 1
Impact on roof 1
Battery safety 1
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3.8 Demographic Characteristics
The tables below summarize demographic characteristics.
Table 3-35 Number of People in the Household
Number of people in household* SEVI 1 SEVI 2 SEVI 3 SEVI 4 Weighted Average
1 15% 15% 20% 23% 19%
2 46% 40% 40% 32% 30%
3 20% 24% 13% 18% 19%
4 15% 13% 19% 11% 18%
5 3% 7% 6% 12% 8%
6 or more 1% 1% 3% 3% 6%
Table 3-36 Language Spoken at Home
Languages spoken home* SEVI 1 SEVI 2 SEVI 3 SEVI 4 Weighted Average
Only English is spoken* 67% 54% 41% 44% 49%
Spanish* 2% 6% 8% 17% 14%
Mandarin* 13% 23% 27% 13% 11%
Vietnamese* 0% 2% 3% 7% 5%
Tagalog 0% 0% 1% 2% 1%
Hindi 1% 3% 1% 3% 3%
Korean 1% 5% 1% 1% 3%
Japanese 2% 1% 2% 1% 2%
Other 16% 9% 17% 14% 14%
* Indicates statistically significant difference across all groups at the p < .05 level.
Table 3-37 Race/Ethnicity
Race/Ethnicity SEVI 1 SEVI 2 SEVI 3 SEVI 4 Weighted
Average
White 67% 50% 38% 40% 51%
Chinese 19% 28% 35% 23% 13%
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Race/Ethnicity SEVI 1 SEVI 2 SEVI 3 SEVI 4 Weighted
Average
Vietnamese NA 2% 2% 8% 6%
Indian/Pakistani 7% 6% 4% 8% 10%
Other Asian (Japanese, Filipino, Korean) 2% 4% 5% 7% 8% Other 6% 11% 15% 14% 13%
Note: Race and ethnicity responses were recoded into the most prevalent groups in SVCE’s service territory. The Other category includes response from those who indicated “Other,” more than one category, and those from groups with smaller populations in the service territory.
Table 3-38 Hispanic, Latino, or Spanish Origin
Hispanic, Latino, or Spanish origin SEVI 1 SEVI 2 SEVI 3 SEVI 4 Weighted Average
Yes 2% 4% 11% 20% 18%
No 98% 96% 89% 80% 82%
Table 3-39 Income
Income* SEVI 1 SEVI 2 SEVI 3 SEVI 4 Weighted
Average
Less than $40,000 NA 7% 14% 16% 15%
Between $40,000 and $64,999 4% 8% 8% 17% 11%
Between $65,000 and $94,999 13% 10% 9% 7% 12%
Between $95,000 and $149,999 14% 11% 21% 28% 21%
Between $149,999 and $200,000 19% 25% 13% 12% 13%
Over $200,000 50% 40% 36% 20% 28%
*Indicates statistically significant difference across all groups at the p < .05 level.
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Table 3-40 Age
Age SEVI 1 SEVI 2 SEVI 3 SEVI 4 Weighted
Average
18-24 2% 2% 2% 0% 2%
25-34 12% 9% 21% 12% 15%
35-44 12% 11% 20% 18% 20%
45-54 15% 16% 16% 23% 19%
55-64 22% 30% 21% 21% 20%
65+ 37% 33% 20% 26% 24%
3.9 Home Characteristics
The tables below summarize home characteristics.
Table 3-41 Home Ownership
Home Ownership SEVI 1 SEVI 2 SEVI 3 SEVI 4 Weighted
Average
Own 88% 84% 60% 59% 60%
Rent 12% 16% 40% 41% 40%
*Indicates statistically significant difference across all groups at the p < .05 level.
Table 3-42 Internet Access
Internet Access SEVI 1 SEVI 2 SEVI 3 SEVI 4 Weighted
Average
Cellular plan for smartphone or other
mobile device 98% 97% 96% 94% 96%
Home internet service such as cable, fiber
optic, satellite, or DSL service installed in
this household*
98% 96% 96% 93% 94%
*Indicates statistically significant difference across all groups at the p < .05 level.
Table 3-43 Home Type
Home Type SEVI 1 SEVI 2 SEVI
3 SEVI
4 Weighted
Average
Manufactured home 1% 2% 1% 3% 2%
Single-family house detached from any other house 76% 68% 49% 47% 53% Item 7
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Single family house attached to one or more other
houses, for example, duplex, row house, or
townhome
13% 17% 15% 14% 12%
Apartment in a building with 2 to 3 units 0% 2% 4% 6% 5% Apartment in a building with 4 or more units 9% 10% 29% 29% 26% Other [text box] 1% 2% 2% 2% 2%
*Indicates statistically significant difference across all groups at the p < .05 level.
Table 3-44 Heating Fuel Type
Heating fuel SEVI 1 SEVI 2 SEVI 3 SEVI 4 Weighted
Average
Natural gas 73% 75% 59% 60% 62%
Electricity 25% 24% 39% 38% 36%
Other 3% 2% 3% 1% 2%
Table 3-45 Water Heating Fuel
Water heating fuel SEVI 1 SEVI 2 SEVI 3 SEVI 4 Weighted Average
Natural gas 82% 85% 81% 82% 81%
Electricity 15% 14% 17% 15% 17%
Other 3% 1% 2% 2% 2%
Table 3-46 Plug-In Vehicles
Metric SEVI 1 SEVI 2 SEVI 3 SEVI 4 Weighted
Average
Own or lease electric vehicle with a plug* 34% 24% 21% 11% 20% A member of the household parks a
vehicle, of any type, within about 20 feet
of an electric outlet?*
77% 71% 51% 46% 55%
*Indicates statistically significant difference across all groups at the p < .05 level.
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4 Appendix 1: Questions Asked in 2020 and 2022
Surveys
This appendix summarizes the questions that were asked of respondents in 2020 and 2022.
4.1 Questions on Awareness
The following questions on awareness of SVCE were included in both the 2020 and 2022 survey.
One of the electricity providers in your region is Silicon Valley Clean Energy. Which of the following describes your awareness of Silicon Valley Clean Energy?
1. You have heard of Silicon Valley Clean Energy before this survey
2. This is the first time you have heard of Silicon Valley Clean Energy Which of the following statements about Silicon Valley Clean Energy, also known as SV Clean Energy, are true or false. Your best guess is fine.
[Response options: 1 = True, 2 = False]
1. SV Clean Energy is a community-owned, not-for-profit, public agency
2. SV Clean Energy electricity rates are lower than PG&E rates
3. SV Clean Energy provides electricity exclusively from renewable and clean energy sources
4. SV Clean Energy is a company, division, or branch of PG&E You live in a community that SV Clean Energy provides electricity for. SV Clean Energy works with PG&E to provide your electricity service and you receive a monthly bill from PG&E for your electricity use.
Have you seen the SV Clean Energy Electric Generation charge on your electricity bill?
1. Yes
2. No or not sure
Before today, did you know that SV Clean Energy provides the electricity that you use?
1. Yes
2. No
4.2 Website Usage
The 2020 and 2022 surveys included a question on whether or not customers have accessed the website, however the wording varied somewhat.
2020 Question Wording
Before today, have you visited the SV Clean Energy website?
1. Yes
2. No, not that you recall
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2022 Question Wording
From emails or other means, have you visited the SV Clean Energy website?
1. Yes
2. No, not that you recall
4.3 Energy Efficiency Attitudes and Awareness
Please mark if your perspective is that the following statements about all-electric homes are true or false. [Scale: 1 = True, 2 = False]
a) All-electric homes are more energy efficient
b) All-electric homes are expensive
c) All-electric homes improve indoor and outdoor air quality The next few questions are about your attitudes towards fossil fuel use. Fossil fuels include coal, oil, natural gas, and propane.
Using a scale where 0 means not at all and 10 means a great deal, to what extent do you feel a personal responsibility to try to reduce the use of fossil fuels? [Scale: 0 (Not at all) – 10 (A great deal)]
Using the same scale, how much have you thought about your use of fossil fuels before today? [Scale: 0 (Not at all) – 10 (A great deal)]
Using a scale where 0 means not at all worried and 10 means extremely worried, how worried are you about your use of fossil fuels?
Driving an electric vehicle is better for the environment than operating a standard gas vehicle.
1. Strongly agree
2. Somewhat agree
3. Neither agree nor disagree
4. Somewhat disagree
5. Strongly disagree
Using electricity to power your water heater is better for the environment than using natural gas.
1. Strongly agree
2. Somewhat agree
3. Neither agree nor disagree
4. Somewhat disagree
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5. Strongly disagree
Using an electric, induction cooktop is better for the environment and safer for the user than using a gas stove.
1. Strongly agree
2. Somewhat agree
3. Neither agree nor disagree
4. Somewhat disagree
5. Strongly disagree
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5 Appendix 2: Survey Instrument
Screening
1. Our records say that you live at [ADDRESS]. Is that your current address?
1. Yes
2. No
[Display if Q1 = 2]
2. What city do you live in?
1. Campbell
2. Cupertino
3. Gilroy
4. Los Altos
5. Los Altos Hills
6. Los Gatos
7. Milpitas
8. Monte Sereno
9. Morgan Hill
10. Mountain View
11. Saratoga
12. Sunnyvale
13. Unincorporated Santa Clara County (including Alum Rock, Burbank, Cambrian Park, East Foothills, Lexington Hills, Loyola, San Martin, Fruitdale, and any other unincorporated location)
14. None of the above [Terminate survey: Display: Thank you for that information but you do not qualify for this survey.]
SVCE Awareness
3. From whom do you currently purchase electricity?
[Display if (Q3 contains “PGE” or “PG&E” or “Pacific” or “Gas” ) and (Q1 does not contain “SVCE” or “Silicon” or “Valley” or “Clean”, “SV”)] [Select ignore case]
4. It seems like you mentioned PG&E. PG&E provides your electricity delivery service. Do you know who provides your electricity generation service?
1. Yes (Who provides it?)
2. No
5. One of the electricity providers in your region is Silicon Valley Clean Energy. Which of the following describes your awareness of Silicon Valley Clean Energy?
1. You have heard of Silicon Valley Clean Energy before this survey
2. This is the first time you have heard of Silicon Valley Clean Energy Item 7
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6. Which of the following statements about Silicon Valley Clean Energy, also known as SV Clean Energy, are true or false. Your best guess is fine.
[Response options: 1 = True, 2 = False]
1. SV Clean Energy is a community-owned, not-for-profit, public agency
2. SV Clean Energy electricity rates are lower than PG&E rates
3. SV Clean Energy provides electricity exclusively from renewable and clean energy sources
4. SV Clean Energy is a company, division, or branch of PG&E
7. You live in a community that SV Clean Energy provides electricity for. SV Clean Energy works with PG&E to provide your electricity service and you receive a monthly bill from PG&E for your electricity use.
Have you seen the SV Clean Energy Electric Generation charge on your electricity bill?
1. Yes
2. No or not sure
8. Before today, did you know that SV Clean Energy provides the electricity that you use?
1. Yes
2. No
Program Awareness
9. Have you heard of the following SV Clean Energy offers and services? [Response options: 1 = Yes, 2 = No]
1. eHub, online resource center
2. Rebates for efficient, electric appliances
3. Heat Pump Water Heater rebate
4. GridShift EV Charging
5. Education Fund grants or the Empower Silicon Valley Film Competition
10. Have you received any emails or postal mail from SV Clean Energy?
1. Yes
2. No, not that you recall
11. From emails or other means, have you visited the SV Clean Energy website?
1. Yes
2. No, not that you recall
[Display if Q12 = 1]
12. What have you visited the SV Clean Energy website for? Please select all that apply.
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[Multiselect]
1. Review electric rates
2. Learn more about financial assistance programs
3. Learn more about electric vehicles
4. Learn more about solar and batteries
5. Learn more about efficient, electric appliances
6. Other (specify)
13. How would you prefer to get information from SV Clean Energy on clean energy products and services? Please select up to three from the list below. [Multiselect. Limit to three selections. Randomize 1 -11]
1. Email
2. Postal mail
3. Radio advertisements
4. Local television station advertisement
5. Video streaming advertisement (such as YouTube or Hulu)
6. Newspaper
7. Facebook post
8. Twitter post
9. Instagram post
10. Nextdoor post
11. With energy bill
12. Some other way
[Display if Q13 = 12]
14. What other way do you think SV Clean Energy should use to inform you and your neighbors about the clean energy products and services they offer?
Electrification Awareness and Education
15. Please mark if your perspective is that the following statements about all-electric homes are true or false.
[Scale: 1 = True, 2 = False]
a) All-electric homes are more energy efficient
b) All-electric homes are expensive
c) All-electric homes improve indoor and outdoor air quality
16. The next few questions are about your attitudes towards fossil fuel use. Fossil fuels include coal, oil, natural gas, and propane.
17. Using a scale where 0 means not at all and 10 means a great deal, to what extent do you feel a personal responsibility to try to reduce the use of fossil fuels? Item 7
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[Scale: 0 (Not at all) – 10 (A great deal)]
18. Using the same scale, how much have you thought about your use of fossil fuels before today? [Scale: 0 (Not at all) – 10 (A great deal)]
19. Using a scale where 0 means not at all worried and 10 means extremely worried, how worried are you about your use of fossil fuels?
[Scale: 0 (Not at all worried) – 10 (Extremely worried)] Agreement & Disagreement Statements
20. Please mark how much you agree or disagree with the following statements.
21. Driving an electric vehicle is better for the environment than operating a standard gas vehicle.
1. Strongly agree
2. Somewhat agree
3. Neither agree nor disagree
4. Somewhat disagree
5. Strongly disagree
22. Using electricity to power your water heater is better for the environment than using natural gas.
1. Strongly agree
2. Somewhat agree
3. Neither agree nor disagree
4. Somewhat disagree
5. Strongly disagree
23. Using an electric, induction cooktop is better for the environment and safer for the user than using a gas stove.
1. Strongly agree
2. Somewhat agree
3. Neither agree nor disagree
4. Somewhat disagree
5. Strongly disagree
24. Please rank the following considerations when making decisions about your home and the products you purchase in order from most important to least important.
Click and drag the options to rank them
[Randomize]
1. Environmental impacts
2. Health and safety
3. Cost
4. Convenience/performance
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Awareness and Education of Specific Technologies
25. What is your level of awareness of electric vehicles (this includes both battery electric and plug-in hybrid vehicles)?
1. I already own one
2. I am interested in one and have considered buying one
3. I am interested in one, but have not considered buying one
4. I have heard of them, but am not interested in one
5. I have not heard of them [Skip to Q29]
26. What sources of information have you used to learn about electric vehicles? Please select all that apply.
[Multiselect. Randomize 1 -9]
1. I have not used any sources of information to learn about electric vehicles. [Make exclusive]
2. SV Clean Energy website (including the EV Assistant online tool)
3. Friend or family
4. Community workshops
5. News
6. Dealerships
7. Social media such as Facebook or Instagram
8. Automotive media such as magazines, websites, YouTube channels, television shows, or blogs
9. Other (specify)
27. How likely are you to choose an electric vehicle for your next vehicle purchase?
1. Extremely likely
2. Very likely
3. Somewhat likely
4. Not so likely
5. Not at all likely
28. What are the biggest barriers you face to purchase or lease an electric vehicle? Please select up to three options.
[Multiselect. Limit to three selections. Randomize 1 -10]
1. Cost of purchasing or leasing an electric vehicle
2. Cost of operating an electric vehicle including electricity costs
3. Driving range of the vehicle
4. Reliability of the technology
5. Don’t know enough information about electric vehicles
6. Not enough models or styles to choose from
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7. Not having a place to charge the vehicle at my home
8. Not knowing where I can charge it away from my home
9. Concern about the safety of electric vehicle battery systems
10. Unable to find one for sale
11. Other (specify)
29. What is your level of awareness of efficient, electric water heaters, also known as a heat pump water heater?
1. I already own one
2. I am interested in one and have considered buying one
3. I am interested in one, but have not considered buying one
4. I have heard of them, but I am not interested in one
5. I have not heard of them [Skip to Q33]
30. What sources of information have you used to learn about heat pump water heaters? Please select all that apply.
[Multiselect. Randomize 2 -11]
1. I have not used any sources of information to learn about heat pump water heaters. [Make exclusive]
2. SV Clean Energy website (including the Appliances Assistant online tool)
4. Friend or family
5. Community workshops
6. News
7. Contractor
8. Plumber
9. Electrician
10. Do it yourself or home renovation media such as magazines, websites, YouTube channels, television shows, or blogs
11. Social media such as Facebook or Instagram
12. Other (specify)
[Display if Q29 = 2 or 3 (Asked if they are interested in a heat pump water heater)]
31. How likely are you to choose a heat pump water heater for your next water heater purchase?
1. Extremely likely
2. Very likely
3. Somewhat likely
4. Not so likely
5. Not at all likely
[Display if Q29 = 2 -4 (Is interested in a heat pump water heater or is not interested in one. Those who have a heat pump water heater or have not heard of them are not asked the question.)]
32. What are the biggest barriers you face to installing a heat pump water heater? Please select up to three options.
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[Multiselect. Limit to three selections. Randomize 1 -8]
1. Cost of purchase and installation
2. Cost of electricity to heat water
3. Reliability of the technology
4. Don’t know enough information
5. Not enough available models
6. Can’t find a contractor who will install one
7. Need to upgrade electric system such as add an outlet, upgrade electric panel
8. Does not work for my property or I do not own my home
9. Other (Specify)
33. What is your level of awareness of rooftop solar paired with battery storage?
1. I already own a rooftop solar system without battery storage
2. I already own a rooftop solar system with battery storage
3. I am interested in rooftop solar with battery and have considered installing a system
4. I am interested in rooftop solar with battery, but have not considered installing a system
5. I have heard of it, but I am not interested in rooftop solar with battery
6. I have not heard of rooftop solar with battery [Skip to Q38]
34. What sources of information have you used to learn about solar and battery storage? Please select all that apply.
[Multiselect. Randomize 2 -10]
1. I have not used any sources of information to learn about solar and battery storage. [Make exclusive]
2. SV Clean Energy website (including the Solar + Battery Assistant online tool)
3. Friend or family
4. Community workshops
5. News
6. Contractor
7. Plumber
8. Electrician
9. Do it yourself or home renovation media such as magazines, websites, YouTube channels, television shows, or blogs
10. Social media such as Facebook or Instagram
11. Other (Specify)
[Display if Q33 = 3 or 4 (is interested in solar and battery)]
35. How likely are you to install solar paired with battery storage in the next three years?
1. Extremely likely
2. Very likely
3. Somewhat likely
4. Not so likely
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5. Not at all likely
[Display if Q33 = 1 (Has solar without battery storage)]
36. How likely are you to add battery storage to your existing solar system in the next three years?
1. Extremely likely
2. Very likely
3. Somewhat likely
4. Not so likely
5. Not at all likely
[Display if Q33 = 1, 3, 4, or 5 (Has solar without battery, is interested in solar and battery system, or is not interested in solar and battery. Those who have solar and battery or who have not heard of solar and battery are not asked this question.)]
37. What are the biggest barriers you face for installing solar and a battery? Please select up to three options.
[Multiselect. Limit to three selections. Randomize 1 -5]
1. [Display if Q33 = 3-5] Cost of purchase and installation of solar
2. Cost of purchase and installation of battery
3. Reliability of the technology
4. Don’t know enough information
5. Does not work for my property or I do not own my home
6. Other (specify)
38. Which purchases, if any, are you likely to make within the next three years (Select all that apply.) [Multiselect. Randomize 1 -6]
1. Smart thermostat
2. Home energy audit or evaluation
3. Induction cooktop
4. Heat pump heating and cooling system
5. Home EV charger
6. Electric yard and garden equipment
7. None of the above [Make exclusive]
Demographics and Home Characteristics [Do not display title]
39. The next few questions are about you and your home. Like all of your responses, we will keep your answers confidential. However, you do not need to answer these questions if you do not want to.
40. Do you rent or own your home?
1. Own
2. Rent
98. Don’t know
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99. Prefer not to answer
41. Do you or any member of your household have access to the internet using a:
[Response options: 1 = Yes, 2 = No.]
a. Cellular data plan for a smartphone or other mobile device? b. Home internet service such as cable, fiber optic, satellite, or DSL service installed in this household?
42. Which of the following best describes your home?
1. Manufactured home
2. Single-family house detached from any other house
3. Single family house attached to one or more other houses, for example, duplex, row house, or townhome
4. Apartment in a building with 2 to 3 units
5. Apartment in a building with 4 or more units
6. Other [text box]
98. Don’t know
99. Prefer not to answer
43. What is the primary fuel type used to heat your home?
1. Natural gas
2. Electricity
3. Other [text box]
98. Don’t know
99. Prefer not to answer
44. What is the primary fuel type to operate your water heater?
1. Natural gas
2. Electricity
3. Other [text box]
98. Don’t know
99. Prefer not to answer
45. Do you or any member of your household own or lease an electric vehicle that has a plug?
1. Yes
2. No
98. Not sure
99. Prefer not to answer
46. Do you or any member of your household park a vehicle, of any type, within about 20 feet of an electric outlet?
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1. Yes
2. No
98. Not sure
99. Prefer not to answer
47. Including yourself, how many people lived in your home in 2021?
1. 1 person
2. 2 people
3. 3 people
4. 4 people
5. 5 people
6. 6 people
7. 7 people
8. 8 or more people
98. Don’t know
99. Prefer not to answer
48. What is your age group?
1. 18-24
2. 25-34
3. 35-44
4. 45-54
5. 55-64
6. 65+
99. Prefer not to answer
[Display if survey was administered in English]
49. What languages other than English are spoken at your home? [Multiselect]
0. Only English is spoken [Make exclusive]
1. Spanish
2. Mandarin
3. Vietnamese
4. Tagalog
5. Hindi
6. Korean
7. Japanese
8. Other
99. Prefer not to answer [Make exclusive]
50. Which of the following categories best describes your total household income in 2021?
1. Less than $40,000
2. Between $40,000 and $64,999
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3. Between $65,000 and $94,999
4. Between $95,000 and $149,999
5. Between $149,999 and $200,000
5. Over $200,000
98. Don’t know
99. Prefer not to answer
51. Are you of Hispanic, Latino, or Spanish origin?
1. Yes
2. No
99. Prefer not to answer
52. What is your race or ethnicity? (Select all that apply) [Multiselect]
1. White / Caucasian
2. Chinese
3. Vietnamese
4. Filipino
5. Japanese
6. Korean
7. Indian
8. Pakistani
9. Black / African American
10. Native American / Alaskan Native
11. Native Hawaiian
12. Other Pacific Islander
13. Other
99. Prefer not to answer [Make exclusive]
Thank You! That completes the survey.
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6 Appendix 3: Email Recruitments
Initial Email Invitation
Subject: We want to hear your thoughts
Dear [FirstName],
I am contacting you on behalf of a local, public agency.
You were selected to participate in a study on peoples’ awareness of the energy and climate initiatives in Santa Clara County. We need your feedback to help shape the services and ways your energy provider communicates with its customers.
Can you help us by taking this survey?
The survey takes about 10 to 15 minutes to complete, and your valuable feedback will be held in confidence.
To thank you for your time we are offering a [$10/$25] Tango Rewards e-gift card, which can be redeemed online at a variety of retailers, to the first 150 customers that complete the survey. To participate and receive the gift card, you must complete the survey by [Date].
Click Here to Start the Survey
You can use any device with internet (phone, computer or tablet) to take the survey. If you can't click the link above, please copy and paste this link into your browser:
[ADD SURVEY LINK]
Thank you for your input!
ADM Associates
First Reminder Email Invitation
Subject: Do you have a few minutes to tell us what you think? Dear [FirstName],
Recently we contacted you to complete a survey on peoples’ awareness of the energy companies that serve Santa Clara County and the services they provide.
We would greatly appreciate it if you could take a few minutes to complete this survey.
To thank you for your time we are offering a [$10/$25] Tango Rewards e-gift card, which can be redeemed online at a variety of retailers, to the first 150 customers that complete the survey. To participate and receive the gift card, you must complete the survey by [Date].
Click Here to Start the Survey
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You can use any device with internet (phone, computer or tablet) to take the survey. If you can't click the link above, please copy and paste this link into your browser:
[ADD SURVEY LINK]
Thank you for your input!
ADM Associates
Second Reminder Email Invitation
Subject: Can you help us meet our goal?
Dear [FirstName],
We just wanted to remind you that you were selected complete a survey on peoples’ awareness of the energy companies that serve the Santa Clara County and the services they provide.
We need a few more responses from people like you.
Can you help us reach our goal?
Click Here to Start the Survey
To thank you for your time we are offering a [$10/$25] Tango Rewards e-gift card, which can be redeemed online at a variety of retailers, to the first 150 customers that complete the survey. To participate and receive the gift card, you must complete the survey by [Date].
You can use any device with internet (phone, computer or tablet) to take the survey. If you can't click the link above, please copy and paste this link into your browser:
[ADD SURVEY LINK]
Thank you for your input!
ADM Associates
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7 Appendix 4: Telephone Recruitment Script
Recruitment
My name is ___________ and I’m from ADM Associates, a national research company.
I am contacting you on behalf of a local, public agency to participate in a study on peoples’ awareness of the energy and climate initiatives in Santa Clara County.
This is not a sales call, and I am not going to ask you to buy anything. We need your feedback to help shape the services and ways your energy provider communicates with its customers. We are offering a $25 electronic gift card for your time.
Do you have a few minutes to speak with me?
May I speak with CONTACT NAME?
[IF NOT AVAILABLE] Is there another adult that I could speak to? [IF NO, ASK TO SCHEDULE A CALL BACK TIME WITH THE ORIGINAL CONACT] [IF REFUSAL, ATTEMPT TO CONVERT] I understand that you are not interested but your responses are very important.
FAQ
(Why are you conducting this study?: Studies like this provide information on customer’s knowledge of energy and climate initiatives in Santa Clara county.)
(Timing: This survey should take about 10-15 minutes of your time. Is this a good time for us to speak with you? IF NOT, SET UP CALL BACK APPOINTMENT)
(Sales concern: I am not selling anything; we would simply like to learn about your experience with the program. Your responses will be kept confidential and not revealed to anyone. ) (What is an eGift card?: The eGift card is a gift card provided by email that you can redeem for a $10 Visa card or for a purchase at stores like Amazon and Best Buy, and at restaurants like Chipotle and Olive Garden)
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Staff Report – Item 8
Item 8: New Construction Reach Code Update
From: Girish Balachandran, CEO
Prepared by: Justin Zagunis, Director of Decarbonization Programs and Policy Zoe Elizabeth, Deputy Director of Decarbonization Programs and Policy Date: 6/8/2022
RECOMMENDATION
Staff requests that the Board of Directors receive an update from the Decarbonization Programs and Policy team on New Construction Reach Codes.
BACKGROUND
In 2019, SVCE offered technical support to member jurisdictions that were evaluating options for amending the state’s 2020 building code. Eleven of SVCE’s jurisdiction’s passed reach codes applying to the 2019 building code. These reach codes (with the exception of those passed by Morgan Hill and Campbell) will expire 12/31/2022.
Staff is in the process of supporting member agencies with core technical assistance and supportive elements, to adopt, renew, or enhance these codes. In addition, staff is in the process of developing resources that will support policies for existing building electrification.
An initial update was provided to the Board of Directors at the March 9, 2022 board meeting, with additional updates in April and May.
ANALYSIS & DISCUSSION
In an effort to continue communications with the Board of Directors on reach codes, staff developed a summary of next steps for members of our board to adopt reach codes this year; these steps will be reviewed during the staff presentation.
STRATEGIC PLAN
These efforts support SVCE’s Strategic Plan Goal 8, “coordinate development of decarbonization and resilience strategy, lead design of local policy and programs, and support program deployment.”
FISCAL IMPACT
N/A
ATTACHMENTS
1. This presentation is posted to the SVCE website.
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/ A"\ SILICON VALLEY
~CLEAN ENERGY
Appendix A
Silicon Valley Clean Energy
Board of Directors Meeting
June 8, 2022
Appendix A
Power Resource Contracts Executed by CEO
rA, s1L1coN VALLEY ~ CLEAN ENERGY
DocuSign DocuSign Envelope Envelope ID: EC3BF811 DAAFEA5C-DBB4 -ADA4-4A91 -460C-8752 -99D6-A8169027B457 -D0187607B12E 1 WSPP RESOURCE ADEQUACY CONFIRMATION
This Confirmation confirms the transaction between Silicon Valley Clean Energy Authority, a California joint powers authority (“Seller”) and Valley Electric Association, a Nevada non-profit cooperative corporation without stock (“Purchaser”), and each individually a “Party” and together the “Parties”, dated as of April 18, 2022 (the “Effective Date”), by which Seller agrees to sell and deliver, and Purchaser agrees to purchase and receive, the Product (the “Transaction”). This Transaction is governed by the WSPP Agreement dated August 12, 2021 (the “WSPP Agreement”). The WSPP Agreement and this Confirmation, including any applicable appendices, exhibits or amendments thereto, shall be collectively referred to herein as the “Agreement” and will constitute a single agreement between the Parties with respect to the Transaction. Capitalized terms not otherwise defined in this Confirmation or the WSPP Agreement are defined in the Tariff.
ARTICLE 1
TRANSACTION TERMS
Product, Delivery Period, Contract Quantity, Contract Price and other specifics of the Product are in Appendix B. Appendices A, B, C, and D are incorporated into this Confirmation. ☐ Firm RA Product:
Seller shall provide Purchaser with the Product from the Unit in the amount of the Contract Quantity. If the Unit is not available to provide the full amount of the Contract Quantity for any reason, then Seller shall have the option to supply Alternate Capacity pursuant to Section 2.3 to fulfill the remainder of the Contract Quantity during such period. If Seller fails to provide Purchaser with the Contract Quantity and has failed to supply Alternate Capacity to fulfill the remainder of the Contract Quantity during such period, then Seller shall be liable for damages and/or required to indemnify Purchaser for penalties or fines pursuant to the terms of Section 2.5. ☒ Contingent Firm RA Product:
Seller shall provide Purchaser with Product from the Unit in the amount of the Contract Quantity.
If the Unit is not available to provide the full amount of the Contract Quantity as a result of any reduction of the Contract Quantity of the Unit in accordance with Section 2.2, Seller shall have the option to notify Purchaser that either (a) Seller will not provide the portion of the Contract Quantity attributable to such reduction during the period of such non-availability; or (b) Seller will supply Alternate Capacity to fulfill the remainder of the Contract Quantity during such period pursuant to Section 2.3. If the Unit is not available to provide the full amount of the Contract Quantity as a result of any reason other than as provided in Section 2.2, then Seller shall have the option to supply Alternate Capacity pursuant to Section 2.3 to fulfill the remainder of the Contract Quantity during such period. If Seller fails to provide Purchaser with the Expected Contract Quantity from the Unit and has failed to supply Alternate Capacity to fulfill the remainder of the Expected Contract Quantity during such period, then Seller shall be liable for damages and/or required to indemnify Purchaser for penalties or fines pursuant to the terms of Section 2.5.
Appendix A Valley Electric
DocuSign DocuSign Envelope Envelope ID: EC3BF811 DAAFEA5C-DBB4 -ADA4-4A91 -460C-8752 -99D6-A8169027B457 -D0187607B12E 2 ARTICLE 2
DELIVERY OBLIGATIONS AND ADJUSTMENTS
2.1 Sale and Delivery of Product
(a) For each Showing Month of the Delivery Period, Seller shall sell and deliver to Purchaser, and Purchaser shall purchase and receive from Seller, the Expected Contract Quantity of the Product from the Shown Unit(s). Seller’s obligation to deliver the Expected Contract Quantity of Product for the Delivery Period is firm and will not be excused for any reason.
(b) Seller shall deliver the Expected Contract Quantity by submitting to CAISO in its Supply Plan the Shown Unit(s) and the characteristics of the Shown Unit(s) and Product for Purchaser, as further specified in Appendix B, all in compliance with this Confirmation.
(c) Seller shall cause all Supply Plans to meet and be filed in conformance with the requirements of the CPUC and the Tariff. Seller shall submit, or cause the Shown Unit’s SC to submit, on a timely basis with respect to each applicable Showing Month, Supply Plans in accordance with the Tariff and CPUC requirements to identify and confirm the Product delivered to Purchaser for each Showing Month of the Delivery Period. The total amount of Product identified and confirmed for such Showing Month shall equal the Expected Contract Quantity, including a request for Hold-Back Capacity pursuant to Article Five of this Confirmation. (d) Seller shall sell and deliver Product from a Shown Unit that meets the requirements set forth in Appendix B, including the Resource Category and, if applicable, the Flexible Capacity Category. In no event shall a Shown Unit utilize coal or coal materials as a source of fuel. A Shown Unit must be a specific resource that is connected directly to the CAISO controlled grid or be under the operational control of CAISO. A Shown Unit may not be an unspecified import. Seller shall identify the Shown Unit(s) and Expected Contract Quantity by providing Purchaser with the specific information contemplated in Appendix B no later than the Notification Deadline for the relevant Showing Month.
(e) If CAISO rejects either the Supply Plan or the Resource Adequacy Plan with respect to any part of the Expected Contract Quantity for the Shown Unit(s) in any Showing Month, the Parties shall confer, make such corrections as are necessary for acceptance, and resubmit the corrected Supply Plan or Resource Adequacy Plan for validation before the applicable deadline for the Showing Month. (f) The Product is delivered and received when the CIRA Tool shows that the Supply Plan submitted in compliance with Purchaser’s instructions, including Purchaser’s instructions to withhold all or part of the Expected Contract Quantity from Seller’s Supply Plan for any Showing Month during the Delivery Period, has been accepted for the Product from the Shown Unit(s) by CAISO. Seller has failed to deliver the Appendix A
Valley Electric
DocuSign DocuSign Envelope Envelope ID: EC3BF811 DAAFEA5C-DBB4 -ADA4-4A91 -460C-8752 -99D6-A8169027B457 -D0187607B12E 3 Product if (i) Purchaser has elected to submit the Product from the Shown Unit in its Resource Adequacy Plan and such submission is accepted by the CPUC and the CAISO but the Supply Plan and Resource Adequacy Plan are not matched in the CIRA Tool and are rejected by CAISO notwithstanding performance of Section
2.1(e) or (ii) Seller fails to submit the volume of Expected Contract Quantity for any Showing Month in such amount as instructed by Purchaser for the applicable Showing Month. Seller will not have failed to deliver the Expected Contract Quantity if Purchaser fails or chooses not to submit the Shown Unit(s) and the Product in its Resource Adequacy Plan with the CPUC or CAISO. (g) Hold-Back Capacity, if any, is deemed Contract Quantity delivered, unless utilized under Article Five as Substitute Capacity, then Contract Quantity is delivered according to the timeline requirements therein.
(h) The Shown Unit(s) must not have characteristics that would trigger the need for Purchaser or Seller to file an advice letter or other request for authorization with the CPUC or for Purchaser to make a compliance filing pursuant to California Public Utilities Code Section 380.1
2.2 Reductions in Contract Quantity
(a) If Seller is providing Contingent Firm RA Product, Seller’s obligation to deliver the Contract Quantity for each Showing Month may be reduced at Seller’s option by the amount of any Planned Outages which exist with respect to any portion of the Unit during the applicable Showing Month; provided, (i) Seller notifies Purchaser by the Notification Deadline applicable to that Showing Month of the amount of Product from the Unit that Purchaser may include in Purchaser’s Compliance Showings applicable to that month as a result of such Planned Outage, and (ii) such reduction is able to be reflected on the Supply Plansin accordance with the Tariff. (b) In the event Seller is unable to provide the Contract Quantity for any portion of a Showing Month because of a Planned Outage of a Unit, Seller has the option, but not the obligation, to provide Product for such portions of such Showing Month from Replacement Units, provided Seller provides and identifiessuch Replacement Unitsin accordance with Section2.3.
2.3 Seller’s Option To Provide Alternate Capacity
If Seller is unable to provide the full Contract Quantity for a Showing Month for any reason, including, without limitation, as provided in Section 2.2, or Seller desires to provide some or all of the Contract Quantity for any Showing Month from a different generating unit other than the Unit, then Seller may, at no cost to Purchaser, provide Purchaser with replacement Product from one or more replacement units having the same Capacity Attributes of the Unit(s) originally identified in Appendix B, including the same Resource Category and, if applicable, the Flexible 1 For example, contracts with Once-Through Cooling resources that terminate one year or less before the State Water Resources Control Board compliance deadline require an advice letter filing under CPUC Decision 12-04-046 Appendix A
Valley Electric
DocuSign DocuSign Envelope Envelope ID: EC3BF811 DAAFEA5C-DBB4 -ADA4-4A91 -460C-8752 -99D6-A8169027B457 -D0187607B12E 4 Capacity Category (each such unit, a “Replacement Unit”) in an amount such that the total amount of Product provided to Purchaser from the Unit and any Replacement Unit(s) for each Showing Month is not more than the Contract Quantity, provided that in each case:
(a) Seller shall notify Purchaser in writing of its intent to provide Alternate Capacity and shall identify the proposed Replacement Units from which such Alternate Capacity shall be provided no later than the Notification Deadline for Purchaser’s Compliance Showings related to such Showing Month;
(b) The proposed Replacement Units must (i) be accepted by the CAISO, and (ii) otherwise satisfy the requirements of this Agreement;
(c) Sellershall, or shall cause the SC to submit a Supply Plan for each Showing Month and, if applicable, annual filing, no later than the Notification Deadline for Purchaser’s Compliance Showings;
(d) If Seller does not comply with the requirements of Sections 2.3(a), (b) and (c) for the applicable Showing Month and, if applicable, annual filing, then any such Replacement Units shall not be deemed a Replacement Unit for purposes of this Confirmation for that Showing Month and Seller shall not receive payment for such Product; and
(e) The designation of any Replacement Unit(s) by Seller shall be subject to Purchaser’s prior written approval, which shall not be unreasonably withheld.
Once Seller has identified in writing any Replacement Units that meet the requirements of this Section 2.3 and Purchaser has approved such Replacement Units as consistent with this Confirmation, then any such Replacement Units shall be deemed a Unit for purposes of this Confirmation for that Showing Month. Purchaser’s approval of a Replacement Unit as to a given Showing Month shall not be construed as approval of such Replacement Unit for any subsequent Showing Month.
2.4 Planned Outages
As of the Confirmation Effective Date, Seller and Purchaser have agreed to all Planned Outages as specified in Appendix D (“Planned Outage Schedule”) for all relevant Showing Months for the following calendar year, or until the end of the Delivery Period, whichever is shorter. Seller may provide Purchaser with proposed changes to the Planned Outage Schedule from time to time.
Within ten (10) Business Days after Purchaser’s receipt of any Seller proposed changes, Purchaser shall notify Seller in writing of any reasonable requests for modifications to such Seller proposed changes, and Seller shall, to the extent consistent with Prudent Operating Practice, accommodate Purchaser’s requests regarding the timing of any Seller proposed changes to the Planned Outage Schedule.
Appendix A
Valley Electric
DocuSign DocuSign Envelope Envelope ID: EC3BF811 DAAFEA5C-DBB4 -ADA4-4A91 -460C-8752 -99D6-A8169027B457 -D0187607B12E 5 2.5 Purchaser’s Remedies for Seller’s Failure to Deliver Expected Contract Quantity (a) If Seller fails to deliver any part of the Expected Contract Quantity as required herein for any Showing Month, Seller shall be liable for damages pursuant to Section 21.3 of the WSPP Agreement, without reference to the word “hourly” therein.
(b) Seller shall indemnify, defend and hold harmless Purchaser from any penalties, fines or costs, including Environmental Costs, assessed against Purchaser by the CPUC, CAISO or other Governmental Body resulting from Seller’s failure to deliver the Product or a Shown Unit’s SC’s failure to timely or accurately submit Supply Plans in accordance with the Tariff and this Confirmation. The Parties shall use commercially reasonable efforts to minimize such penalties, fines or costs; provided, that in no event will Purchaser be required to use or change its utilization of its owned or controlled assets or market positions to minimize these penalties, fines or costs. If Seller fails to pay the foregoing penalties, fines or costs, or fails to reimburse Purchaser for those penalties, fines or costs, then, without prejudice to its other rights and remedies, Purchaser may setoff and recoup those penalties, fines or costs against any future amounts it may owe to Seller under this Confirmation or the WSPP Agreement.
2.6 Purchaser’s Re-Sale of Product
(a) Purchaser may re-sell all or part of the Product; provided that any such re-sale must not increase Seller’s obligations hereunder other than as set forth in this Section
2.6(a). For any such a resale, the Resource Adequacy Plan of Purchaser as used herein will refer to the Resource Adequacy Plan of Subsequent Purchaser. Seller shall, or shall cause the Shown Unit’s SC, to follow Purchaser’s instructions with respect to providing such resold Product to Subsequent Purchasers, to the extent such instructions are consistent with Seller’s obligations under this Confirmation.
Seller shall, and shall cause the Shown Unit’s SC, to take all commercially reasonable actions and execute all documents or instruments reasonably necessary to allow such Subsequent Purchasers to use such resold Product in a manner consistent with Purchaser’s rights under this Confirmation. If Purchaser incurs any liability to a Subsequent Purchaser due to the failure of Seller or the Shown Unit’s SC to comply with this Confirmation, Seller will be liable to Purchaser for the amounts Seller would have owed Purchaser under this Confirmation if Purchaser had not resold the Product.
(b) Purchaser shall notify Seller in writing of any resale of Product and the Subsequent Purchaser no later than two (2) Business Days before the Notification Deadline for each Showing Month for which Purchaser has resold the Product. Purchaser shall notify Seller of any subsequent changes or further resales no later than two (2) Business Days before the Notification Deadline for the Showing Month.
Appendix A
Valley Electric
DocuSign DocuSign Envelope Envelope ID: EC3BF811 DAAFEA5C-DBB4 -ADA4-4A91 -460C-8752 -99D6-A8169027B457 -D0187607B12E 6 (c) If CAISO or CPUC develops a centralized capacity market, Purchaser will have exclusive rights to direct the Seller or the Unit’s SC to offer, bid, or otherwise submit the Expected Contract Quantity of Product for re-sale in such market, Seller and the Unit’s SC shall comply with Purchaser’s direction and Purchaser shall retain and receive all revenues from such re-sale.
(d) Purchaser shall have the exclusive right to direct the Seller or the Unit’s SC to offer, bid, or otherwise submit the Expected Contract Quantity into the CAISO Competitive Solicitation Process (CSP) for CPM Capacity. Seller and the Unit’s SC shall comply with the Purchaser’s direction and, to the extent that the CAISO designates the Expected Contract Quantity as CPM Capacity, Purchaser shall be entitled to retain and receive the CPM Capacity Payment. Unless otherwise instructed by Purchaser, (i) Seller shall not, and shall cause the Unit’s SC to not, offer any portion of the Expected Contract Quantity to CAISO as CPM Capacity and (ii) if CAISO designates any portion of the Contract Capacity as CPM Capacity, then Seller shall, and shall cause the Unit’s SC to, promptly (and in any event within one (1) Business Day of the time Seller receives notification from CAISO) notify Purchaser of such designation, and if CAISO makes such a designation, Seller shall not, and shall cause the Unit’s SC to not, accept any such designation by CAISO unless and until Purchaser has agreed to accept such designation.
ARTICLE 3
PAYMENTS
3.1 Payment
Purchaser shall make a monthly payment to Seller for each Unit by the later of (i) ten (10) Calendar Days after Purchaser’s receipt of Seller’s invoice (which may be given upon first day of the Showing Month) and (ii) the twentieth (20th) of the Showing Month, or if the twentieth (20th) is not a Business Day the next following Business Day (“Monthly RA Capacity Payment”). The Monthly RA Capacity Payment shall equal the product of (a) the applicable Contract Price for that Showing Month, (b) the Expected Contract Quantity for the Showing Month and (c) 1,000, rounded to the nearest penny (i.e., two decimal places); provided, however, that the Monthly RA Capacity Payment shall be adjusted to reflect any portion of Expected Contract Quantity for the Showing Month that was not delivered in accordance with Section 2.1 for such Showing Month.
3.2 Allocation of Other Payments and Costs
(a) Seller will receive any revenues from, and must pay all costs charged by, CAISO or any other third party with respect to the Shown Unit(s) for (i) start-up, shutdown, and minimum load costs, (ii) capacity for ancillary services, (iii) energy sales, (iv) flexible ramping product, or (v) black start or reactive power services. Purchaser must promptly report receipt of any such revenues to Seller. Purchaser must pay to Seller any such amounts described in this Section 3.2(a) received by Purchaser or a Subsequent Purchaser. Without prejudice to its other rights and remedies, Seller Appendix A
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DocuSign DocuSign Envelope Envelope ID: EC3BF811 DAAFEA5C-DBB4 -ADA4-4A91 -460C-8752 -99D6-A8169027B457 -D0187607B12E 7 may setoff and recoup any such amounts that are not paid to it pursuant to this Section 3.2(a) against any amounts owed to Purchaser under the WSPP Agreement. (b) Purchaser is to receive and retain all revenues associated with the Expected Contract Quantity of Product during the Delivery Period, including any capacity and availability revenues from the Capacity Procurement Mechanism, or its successor, RUC Availability Payments, or its successor, but excluding payments described in Section 3.2(a)(i)-(v) or 3.2(d). Seller shall promptly report receipt of any such revenues to Purchaser. Seller shall pay to Purchaser within thirty (30) days of receipt any such amounts received by Seller, or a Shown Unit’s SC, owner, or operator. Without prejudice to its other rights, Purchaser may set off and recoup any such amounts that are not paid to it against amounts owed to Seller under the WSPP Agreement.
(c) If CAISO designates any part of the Contract Quantity as Capacity Procurement Mechanism Capacity, then Seller shall, or shall cause the Shown Unit’s SC to, within one (1) Business Day of the time Seller receives notification from CAISO, notify Purchaser and not accept any such designation by CAISO unless and until Purchaser has agreed to accept such designation.
(d) Any Availability Incentive Payments or Non-Availability Charges are for Seller to receive and pay.
ARTICLE 4
OTHER PURCHASER AND SELLER COVENANTS
4.1 CAISO Requirements
Seller shall schedule or cause the Shown Unit’s SC to schedule or make available to CAISO the Expected Contract Quantity of the Product during the Delivery Period, in compliance with the Tariff, and perform all, or cause the Shown Unit’s SC, owner, or operator to perform all, obligations under applicable law and the Tariff relating to the Product. Purchaser is not liable for, and Seller shall indemnify and hold Purchaser harmless from, the failure of Seller or the Shown Unit’s SC, owner, or operator to comply with the Tariff, and for any penalties, fines or costs imposed on Seller or the Shown Unit’s SC, owner, or operator for noncompliance.
4.2 Seller’s and Purchaser’s Duties to Take Actions to Allow Product Utilization Throughout the Delivery Period, Purchaser and Seller shall take all commercially reasonable actions and execute all documents or instruments reasonably necessary to ensure (a) Purchaser’s rights to the Expected Contract Quantity for the sole benefit of Purchaser or any Subsequent Purchaser and (b) that Purchaser may use the Expected Contract Quantity to meet its Compliance Obligations. Such commercially reasonable actions shall include, without limitation cooperating with and providing, and causing each Shown Unit’s SC, owner, or operator to cooperate with and provide, requested supporting documentation to the CAISO, the CPUC, or any other Governmental Body responsible for administering the applicable Compliance Obligations, including to Appendix A
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DocuSign DocuSign Envelope Envelope ID: EC3BF811 DAAFEA5C-DBB4 -ADA4-4A91 -460C-8752 -99D6-A8169027B457 -D0187607B12E 8 demonstrate that the Expected Contract Quantity can be delivered to the CAISO controlled grid for the minimum hours required to satisfy the Compliance Obligations, as applicable, pursuant to the “deliverability” standards established by the CAISO or other Governmental Body of competent jurisdiction.
If necessary, the Parties further agree to negotiate in good faith to amend this Confirmation to conform this Transaction to subsequent clarifications, revisions, or decisions rendered by CAISO or an applicable Governmental Body to maintain the benefits of the Transaction.
4.3 Seller’s Representations and Warranties
Seller represents and warrants to Purchaser throughout the Delivery Period that:
(a) No part of the Contract Quantity during the Delivery Period has been committed by Seller to any third party to satisfy Compliance Obligations or analogous obligations in any CAISO or non-CAISO markets;
(b) The Shown Unit(s) qualify to provide the Product under the Tariff, and the Shown Unit(s) and Seller are capable of delivering the Product; (c) the aggregation of all amounts of Capacity Attributes that Seller has sold, assigned, or transferred for the Shown Unit(s) during the Delivery Period does not exceed the Shown Unit’s Net Qualifying Capacity and, if applicable, the Effective Flexible Capacity for that Shown Unit;
(d) if applicable, Seller has notified either the Shown Unit’s SC or the entity from which Seller purchased the Product that Seller has transferred the Contract Quantity of Product for the Delivery Period to Purchaser; and
(e) Seller has notified or will notify the Shown Unit’s SC that Purchaser is entitled to the revenues set forth in Section 3.2(b), and such Shown Unit’s SC is obligated to promptly deliver those revenues to Purchaser, along with appropriate documentation supporting the amount of those revenues.
4.4 Market Based Rate Authority
Upon Purchaser’s written request, Seller shall, in accordance with FERC Order No. 697, submit a letter of concurrence in support of any affirmative statement by Purchaser that this contractual arrangement does not transfer “ownership or control of generation capacity” from Seller to Purchaser as the term “ownership or control of generation capacity” is used in 18 CFR Section
35.42. Seller shall not, in filings, if any, made subject to Order Nos. 652 and 697, claim that this contractual arrangement conveys ownership or control of generation capacity from Seller to Purchaser.
Appendix A
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DocuSign DocuSign Envelope Envelope ID: EC3BF811 DAAFEA5C-DBB4 -ADA4-4A91 -460C-8752 -99D6-A8169027B457 -D0187607B12E 9 ARTICLE 5
HOLD-BACK AND SUBSTITUTE CAPACITY
No later than three (3) Business Days before the before the relevant deadlines for the Compliance Showings applicable to that Showing Month, Purchaser may request in writing that Seller not list, or cause the Unit’s Scheduling Coordinator not to list, in the Unit’s Supply Plan a portion or all of the Contract Quantity for any portion of such Showing Month included in the Delivery Period (“Hold-Back Capacity”). Along with such request, Purchaser shall also provide updated Unit information reflecting the requested change. The updated Unit information shall be in the form of the Supply Plan. Following Purchaser’s request for Hold-Back Capacity, Purchaser may request, in writing, that Seller make the previously requested Hold-Back Capacity available for Purchaser’s use as Substitute Capacity within the respective Showing Month. Such request shall be received by Seller no later than eight (8) Business Days prior to the first day for which Purchaser seeks to use such Substitute Capacity as required by the CAISO. The portion of the Contract Quantity that is the subject of Purchaser’s request for Hold-Back Capacity shall be deemed Contract Quantity delivered consistent with Section 2.1 for purposes of calculating a Monthly RA Capacity Payment pursuant to Section 3.1 and calculating any amounts due pursuant to Sections 2.2. Seller shall, or shall cause the Unit’s Scheduling Coordinator to, comply with Purchaser’s request under this Article Five.
ARTICLE 6
ADDITIONAL WSPP AGREEMENT AMENDMENTS; GENERAL PROVISIONS
6.1 Termination Payment
For this Transaction, the following is inserted as a penultimate paragraph in Section 22.2(b) of the WSPP Agreement:
“If Purchaser is the Non-Defaulting Party and Purchaser reasonably expects to incur or be liable for any penalties, fines or costs from CAISO, or any Governmental Body, because Purchaser or a Subsequent Purchaser is not able to include the applicable Expected Contract Quantity in a Compliance Showing due to Seller’s Event of Default, then Purchaser may, in good faith, estimate the amount of those penalties, fines or costs and include the estimate in its determination of the Termination Payment, subject to accounting to Seller when those penalties, fines or costs are finally ascertained. If this accounting establishes that Purchaser’s estimate exceeds the actual amount of penalties, fines or costs, Purchaser must promptly remit to Seller the excess amount with interest in accordance with Section 9.3 of the WSPP Agreement. The rights and obligations with respect to determining and paying any Termination Payment, and any dispute resolution provisions with respect thereto, survive the termination of this Transaction and continue until after those penalties, fines or costs are finally ascertained.”
6.2 Confidentiality
Notwithstanding Section 30.1 of the WSPP Agreement:
(a) (i) Purchaser may disclose information as necessary in order to support its Appendix A
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DocuSign DocuSign Envelope Envelope ID: EC3BF811 DAAFEA5C-DBB4 -ADA4-4A91 -460C-8752 -99D6-A8169027B457 -D0187607B12E 10 Compliance Showings or otherwise show it has met its Compliance Obligations; (ii) Seller may disclose as necessary to a Shown Unit’s SC or as necessary for Supply Plans; (iii) each Party may disclose information as necessary to the independent evaluator or other administrator of any competitive solicitation process of Purchaser, which in turn may disclose such information as necessary to CAISO or any Governmental Body; and (iv) Purchaser may disclose information to any Subsequent Purchaser.
(b) Seller acknowledges that Purchaser is a public agency subject to the requirements of the California Public Records Act (Cal. Gov. Code section 6250 et seq.) and that Purchaser may be required to make public this Confirmation (which may be partially redacted by Purchaser) in connection with the process of seeking approval from its board of directors for the execution of this Confirmation. Seller may submit information to Purchaser that Seller considers confidential, proprietary, or trade secret information pursuant the Uniform Trade Secrets Act (Cal. Civ. Code section 3426 et seq.), or otherwise protected from disclosure pursuant to an exemption to the California Public Records Act (Government Code sections 6254 and 6255). Seller acknowledges that Purchaser may submit to Seller information that Purchaser considers confidential or proprietary or protected from disclosure pursuant to exemptions to the California Public Records Act (Government Code sections 6254 and 6255). Upon request or demand of any third person or entity not a party to this Confirmation (“Requestor”) pursuant to the California Public Records Act for production, inspection and/or copying of this Confirmation or any information designated by a disclosing Party as confidential, the receiving Party as soon as practical shall notify the disclosing Party that such request has been made, by telephone call, letter sent via electronic mail, and/or by overnight carrier to the address, or email address listed at the end of this Confirmation. The disclosing Party shall be solely responsible for taking whatever legal steps are necessary to protect information deemed by it to be confidential information and to prevent release of information to the Requestor by the receiving Party. If the disclosing Party takes no such action within ten (10) days, after receiving the foregoing notice from the receiving Party, the receiving Party shall be permitted to comply with the Requestor’s demand and is not required to defend against it. Notwithstanding the foregoing, Purchaser may release confidential information without notice to or over the objection of Seller if Purchaser’s legal counsel advises Purchaser that Purchaser is required by law to release such confidential information.
6.3 Dodd-Frank Act
The Parties intend this Transaction to be a “customary commercial arrangement” as described in Section II.A.1 of Commodity Futures Trading Commission, Proposed Guidance, Certain Natural Gas and Electric Power Contracts, 81 Fed. Reg. 20583 at 20586 (Apr. 8, 2016) and a “Forward Capacity Transaction” within the meaning of Commodity Futures Trading Commission, Final Order in Response to a Petition From Certain Independent System Operators and Regional Transmission Organizations To Exempt Specified Transactions Authorized by a Tariff or Protocol Approved by the Federal Energy Regulatory Commission, 78 Fed. Reg. 19,880 (Apr. 2, 2013).
Appendix A
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DocuSign DocuSign Envelope Envelope ID: EC3BF811 DAAFEA5C-DBB4 -ADA4-4A91 -460C-8752 -99D6-A8169027B457 -D0187607B12E 11 6.4 Change in Law
If any action by the CPUC, CAISO or any Governmental Body having jurisdiction, or any change in applicable law, occurring after the Confirmation Effective Date results in (i) material changes to Purchaser’s or Seller’s obligations with regard to the Products sold hereunder, (ii) has the effect of changing the transfer and sale procedure set forth in this Confirmation so that the performance of this Confirmation becomes impracticable, or (iii) changes the Resource Adequacy Requirements such that the Product can no longer be counted towards Purchaser’s Resource Adequacy Requirements (a “Change in Law”), the Parties shall work in good faith to revise this Confirmation so that the Parties can perform their obligations regarding the purchase and sale of the Product sold hereunder in order to maintain the original intent.
6.5 Governing Law
Notwithstanding Section 24 of the WSPP Agreement, this Transaction 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.
6.6 Collateral
Notwithstanding any provision in the WSPP Agreement to the contrary, including Section 27, neither Party shall be required to post collateral or other security for this Transaction.
6.7 No Recourse to Members of Purchaser
Purchaser is organized as a Joint Powers Authority in accordance with the Joint Exercise of Powers Act of the State of California (Government Code Section 6500, et seq.) and is a public entity separate from its constituent members. Purchaser will solely be responsible for all debts, obligations and liabilities accruing and arising out of this Confirmation. Seller will have no rights and shall not make any claims, take any actions or assert any remedies against any of Purchaser's constituent members, or the officers, directors, advisors, contractors, consultants or employees of Purchaser or Purchaser's constituent members, in connection with this Confirmation.]
6.8 Other WSPP Agreement Changes
For this Transaction, the WSPP Agreement shall be amended as follows:
(a) Section 9.4 is deleted in its entirety and replaced with the following:
“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, with notice of the objection given to the other Party.
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 two (2) Business Days of such resolution along with interest accrued at the Interest Rate from and including the due date to but excluding Appendix A
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DocuSign DocuSign Envelope Envelope ID: EC3BF811 DAAFEA5C-DBB4 -ADA4-4A91 -460C-8752 -99D6-A8169027B457 -D0187607B12E 12 the date paid. Inadvertent overpayments shall be returned upon request or deducted by the Party receiving such overpayment from subsequent payments, with interest accrued at the Interest Rate from and including the date of such overpayment to but excluding the date repaid or deducted by the Party receiving such overpayment.
Any dispute with respect to an invoice is waived unless the other Party is notified in writing within twelve (12) months after the invoice is rendered or any specific adjustment to the invoice is made. If an invoice is not rendered within twelve (12) months after the close of the month during which performance of a Transaction occurred, the right to payment for such performance is waived.” (b) Section 22.1 is modified by inserting the following new text at the end thereof:
“(f) the failure of the Defaulting Party to pay its debts generally as they become due or the Defaulting Party’s admission in a writing that is unable to generally pay its debts as they become due;
(g) the institution, by the Defaulting Party, of a general assignment for the benefit of its creditors; or
(h) the application for, consent to, or acquiescence to, by the Defaulting Party, the appointment of a receiver, custodian, trustee, liquidator, or similar official for all or a substantial portion of its assets.”
(c) Section 22.2(b) is amended by inserting “and is continuing” after “Event of Default occurs” in the first line thereof and deleting the second sentence therein. (d) Section 22.3(c) is amended by deleting the third sentence thereof and replacing it with the following: “If the Non-Defaulting Party’s aggregate Gains exceed its aggregate Losses and Costs, if any, resulting from the termination of this Agreement or a Confirmation, the Termination Payment for all such Terminated Transactions shall be zero, notwithstanding any provision in this Section or Agreement to the contrary.”
(e) In Section 22.3(e), delete the entire provision (including subsections) and replace it with the following: “[Intentionally omitted]”
(f) In Section 22.3(f), delete the entire provision and replace it with the following:
“If the Defaulting Party disagrees with the calculation of the Termination Payment and the Parties cannot otherwise resolve their differences, and provided that the Defaulting Party has paid the undisputed part of the Termination Payment to the Non-Defaulting Party as provided under Section 22.3(c), and that any amounts disputed by the Defaulting Party are disputed in good faith, then the Defaulting Party may submit the calculation issue to Dispute Resolution pursuant to Section
34.”
(g) Section 28.1 is applicable and the Parties shall net monthly payments in accordance with Exhibit A of the WSPP. Both Parties intend for the netting provisions of Appendix A
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DocuSign DocuSign Envelope Envelope ID: EC3BF811 DAAFEA5C-DBB4 -ADA4-4A91 -460C-8752 -99D6-A8169027B457 -D0187607B12E 13 Exhibit A to the WSPP Agreement to be effective on the Confirmation Effective Date.
(h) Section 30.1 is amended by inserting “or requested” after the word “required” in Section 30.1(4) and by adding the following at the end of the first sentence: “; or (8) to the Party’s and such Party’s affiliates’ lenders, counsel, accountants, advisors and agents who have a need to know such information and have agreed to keep such terms confidential”.
(i) Subsections 34.1 and 34.2 are deleted and replaced with the following:
“34.1 INFORMAL DISPUTE RESOLUTION
IN THE EVENT OF ANY DISPUTE ARISING UNDER THIS
TRANSACTION, WITHIN TEN (10) DAYS FOLLOWING THE RECEIPT OF
A WRITTEN NOTICE FROM EITHER PARTY IDENTIFYING SUCH
DISPUTE, THE PARTIES SHALL MEET, NEGOTIATE AND ATTEMPT, IN
GOOD FAITH, TO RESOLVE THE DISPUTE QUICKLY, INFORMALLY AND INEXPENSIVELY. IF THE PARTIES ARE UNABLE TO RESOLVE A
DISPUTE ARISING HEREUNDER WITHIN THIRTY (30) DAYS AFTER
RECEIPT OF SUCH NOTICE, THEN EITHER PARTY MAY SEEK ANY AND
ALL REMEDIES AVAILABLE TO IT AT LAW OR IN EQUITY, SUBJECT TO THE LIMITATIONS SET FORTH IN THIS TRANSACTION.”
“34.2 EXCLUSIVE JURISDICTION
EACH PARTY SUBMITS TO THE EXCLUSIVE JURISDICTION OF
THE STATE OR FEDERAL COURTS LOCATED IN SAN FRANCISCO,
CALIFORNIA, FOR ANY ACTION OR PROCEEDING RELATING TO THIS
AGREEMENT OR ANY TRANSACTION, AND EXPRESSLY WAIVES ANY
OBJECTION IT MAY HAVE TO SUCH JURISDICTION OR THE
CONVENIENCE OF SUCH FORUM.”
(j) The phrase “arbitration or” is deleted from the first line of Section 34.4. (k) The following shall be inserted as a new Section 34.5:
“34.5 LIMITATION OF DAMAGES. EXCEPT AS OTHERWISE SPECIFIED
IN ANY CONFIRMATION, FOR BREACH OF ANY PROVISION OF THIS
CONFIRMATION AGREEMENT FOR WHICH AN EXPRESS REMEDY OR
MEASURE OF DAMAGES IS PROVIDED, THE EXPRESS REMEDY OR
MEASURE OF DAMAGES PROVIDED IS THE SOLE AND EXCLUSIVE
REMEDY UNDER THIS AGREEMENT AND THE AGREEMENT FOR THE
BREACH, LIABILITY FOR THE BREACH IS LIMITED AS SET FORTH IN
THE PROVISION AND ALL OTHER REMEDIES FOR DAMAGES AT LAW OR IN EQUITY ARE WAIVED. EXCEPT AS OTHERWISE SPECIFIED IN
ANY CONFIRMATION, IF NO EXPRESS REMEDY OR MEASURE OF
DAMAGES IS PROVIDED IN THIS AGREEMENT FOR A PARTICULAR
Appendix A
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DocuSign DocuSign Envelope Envelope ID: EC3BF811 DAAFEA5C-DBB4 -ADA4-4A91 -460C-8752 -99D6-A8169027B457 -D0187607B12E 14 BREACH, LIABILITY FOR THE BREACH IS LIMITED TO DIRECT
DAMAGES ONLY, THE DIRECT DAMAGES ARE THE SOLE AND
EXCLUSIVE REMEDY UNDER THIS AGREEMENT FOR THE BREACH,
AND ALL OTHER REMEDIES FOR DAMAGES AT LAW OR IN EQUITY
ARE WAIVED. EXCEPT AS OTHERWISE SPECIFIED IN ANY
CONFIRMATION, NEITHER PARTY IS LIABLE FOR ANY OTHER TYPE OF
DAMAGE, INCLUDING INCIDENTAL, PUNITIVE, EXEMPLARY,
CONSEQUENTIAL, SPECIAL OR INDIRECT DAMAGES OF ANY NATURE (INCLUDING DAMAGES ASSOCIATED WITH LOST PROFITS, BUSINESS
INTERRUPTION AND LOSS OF GOODWILL) ARISING AT ANY TIME,
WHETHER IN TORT (INCLUDING THE SOLE OR CONTRIBUTORY
NEGLIGENCE OF EITHER PARTY OR ANY RELATED PERSON),
WARRANTY, STRICT LIABILITY, CONTRACT OR STATUTE, UNDER
ANY INDEMNITY PROVISION, OR OTHERWISE.”
(l) Section 37 is amended by inserting the following in the beginning of the section:
“On the date of entering into this Confirmation,”.
(m) Section 41 “Witness” shall become Section 42 and the following “Standard of Review” Section shall be substituted in its place:
“The Parties agree as follows:
From the date of entering into a Transaction under this Agreement and throughout the term of such Transaction, the Parties each warrant and covenant as follows:
(i) Absent the agreement of all Parties to the proposed change, the standard of review for changes to any section of this Agreement (including all Transactions and/or Confirmations) specifying the rate(s) or other material economic terms and conditions agreed to by the Parties herein, whether proposed by a Party, a non-party or FERC acting sua sponte, shall be the “public interest” standard of review set forth in United Gas Pipe Line Co. v. Mobile Gas Service Corp., 350 U.S. 332 (1956) and Federal Power Commission v. Sierra Pacific Power Co., 350 U.S. 348 (1956)( the “Mobile-Sierra” doctrine) and clarified in Morgan Stanley Capital Group, Inc. v.
Public Util. Dist. No. 1 of Snohomish 554 U.S. 527 (2008) and NRG Power Marketing LLC v. Maine Pub. Util. Comm’n, 558 U.S. 165 (2010). (ii) The Parties, for themselves and their successors and assigns, (i) agree that this “public interest” standard shall apply to any proposed changes in any other documents, instruments or other agreements executed or entered into by the Parties in connection with this Agreement and (ii) hereby expressly and irrevocably waive any rights they can or may have to the application of any other standard of review, including the “just and reasonable” standard.”
6.9 Counterparts
Appendix A
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DocuSign DocuSign Envelope Envelope ID: EC3BF811 DAAFEA5C-DBB4 -ADA4-4A91 -460C-8752 -99D6-A8169027B457 -D0187607B12E 15 This Confirmation may be signed in any number of counterparts with the same effect as if the signatures to the counterparts were upon a single instrument. The Parties may rely on electronic, or scanned signatures as originals under this Confirmation. Delivery of an executed signature page of this Confirmation by electronic mail transmission (including PDF) shall be the same as delivery of a manually executed signature page.
6.10 Entire Agreement; No Oral Agreements or Modifications This Confirmation sets forth the terms of the Transaction into which the Parties have entered and shall constitute the entire agreement between the Parties relating to the contemplated purchase and sale of the Product. Notwithstanding any other provision of the Agreement, this Transaction may be confirmed only through a Documentary Writing executed by both Parties, and no amendment or modification to this Transaction shall be enforceable except through a Documentary Writing executed by both Parties.
[Signatures appear on the following page.]
Appendix A
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DocuSign DocuSign Envelope Envelope ID: EC3BF811 DAAFEA5C-DBB4 -ADA4-4A91 -460C-8752 -99D6-A8169027B457 -D0187607B12E 16 AGREED AS OF THE EFFECTIVE DATE:
SILICON VALLEY CLEAN ENERGY
AUTHORITY, a California Joint
Powers Authority
Valley Electric Association, a Nevada non-profit cooperative corporation without stock By: By:
Name: Girish Balachandran
Title: CEO
Name:
Title:
Mark Stallons
CEO
Appendix A
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APPENDIX A
DEFINED TERMS
“Alternate Capacity” means replacement Product which Seller has elected to provide to Purchaser in accordance with the terms of Section 2.3.
“CAISO” means the California ISO or the successor organization to the functions thereof. “Capacity Attributes” means attributes of the Shown Unit that may be counted toward Compliance Obligations, including: flexibility, dispatchability, physical location or point of electrical interconnection of the Shown Unit; Unit ability to generate at a given capacity level, provide ancillary services, or ramp up or down at a given rate; any current or future defined characteristics, certificates, tags, credits, or accounting constructs of the Shown Unit, howsoever entitled, identified from time to time by the CAISO or a Governmental Body having jurisdiction over Compliance Obligations.
“CIRA Tool” means the CAISO Customer Interface for Resource Adequacy. “Compliance Obligations” means, as applicable, RAR, Local RAR and FCR. “Compliance Showings” means the applicable LSE’s compliance with the resource adequacy requirements of the CPUC for an applicable Showing Month. “Contingent Firm RA Product” has the meaning set forth in Article 1 herein. “CPUC Decisions” means any currently effective or future decisions, resolutions, or rulings related to resource adequacy.
“CPUC Filing Guide” is the document issued annually by the CPUC which sets forth the guidelines, requirements and instructions for load serving entities to demonstrate compliance with the CPUC’s resource adequacy program.
“Effective Flexible Capacity” has the meaning given in CAISO’s FERC-approved Tariff. “Environmental Costs” means (i) costs incurred in connection with acquiring and maintaining all environmental permits and licenses for the Product, (ii) the Product’s compliance with all applicable environmental laws, rules, and regulations, including capital costs for pollution mitigation or installation of emissions control equipment required to permit or license the Product, (iii) all operating and maintenance costs for operation of pollution mitigation or control equipment, (iv) costs of permit maintenance fees and emission fees as applicable, (v) the costs of all emission reductions that have been authorized by a local air pollution control district or emissions trading credits or units pursuant to the California Health & Safety Code, market based incentive programs such as the South Coast Air Quality Management District’s Regional Clean Air Incentives Market, authorizations to emit sulfur dioxide and oxides of nitrogen by the Environmental Protection Agency, and any costs related to greenhouse gas emissions required by any applicable Appendix A
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environmental laws, rules, regulations, or permits to operate, and (vi) costs associated with the disposal, clean-up, decontamination or remediation, on or off site, of hazardous substances. “Expected Contract Quantity” means,with respect to any Showing Month of the Delivery Period, (a) for Firm RA Product, the Contract Quantity of Product, including the amount of Contract Quantity of Product that Seller has elected to provide Alternate Capacity, and (b) for Contingent Firm RA Product, the Contract Quantity of Product for such Showing Month, including the amount of Contract Quantity of Product that Seller has elected to provide Alternate Capacity, less any reductions to Contract Quantity consistent with Section 2.2 with respect to which Seller has not elected to provide Alternate Capacity.
“FCR” means the flexible capacity requirements established for LSEs by the CPUC pursuant to the CPUC Decisions, the CAISO pursuant to the Tariff, or other Governmental Body having jurisdiction over Compliance Obligations and includes any non-binding advisory showing which an LSE is required to make with respect to flexible capacity. “FCR Attributes” means, with respect to a Shown Unit, any and all resource adequacy attributes of the Shown Unit, as may be identified from time to time by the CPUC, CAISO, or other Governmental Body having jurisdiction over Compliance Obligations, that can be counted toward an LSE’s FCR.
“Firm RA Product” has the meaning set forth in Article 1 herein. “Flexible Capacity Category” shall be as described in the annual CPUC Filing Guide, as such may be modified, amended, supplemented or updated from time to time. “Governmental Body” means any federal, state, local, municipal or other government; any governmental, regulatory or administrative agency, commission or other authority lawfully exercising or entitled to exercise any administrative, executive, judicial, legislative, police, regulatory or taxing authority or power; and any court or governmental tribunal. “Interest Rate” means, for any date, the lesser of (a) the per annum rate of interest equal to the prime lending rate as may from time to time be published in The Wall Street Journal under “Money Rates” on such day (or if not published on such day on the most recent preceding day on which published), plus two percent (2%) and (b) the maximum rate permitted by applicable law. “Local RAR” means the local resource adequacy requirements established for LSEs by the CPUC pursuant to the CPUC Decisions, by CAISO pursuant to the Tariff, or by any other Governmental Body having jurisdiction over Compliance Obligations.
“Local RAR Attributes” means, with respect to a Shown Unit, any and all resource adequacy attributes of the Shown Unit, as may be identified from time to time by the CPUC, CAISO, or other Governmental Body having jurisdiction over Compliance Obligations, that can be counted toward an LSE’s Local RAR.
“LSE” means “Load Serving Entity” as such term is used in Section 40.9 of the Tariff.
Appendix A
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DocuSign DocuSign Envelope Envelope ID: EC3BF811 DAAFEA5C-DBB4 -ADA4-4A91 -460C-8752 -99D6-A8169027B457 -D0187607B12E Appendix A - 3
“MW” means megawatt.
“Net Qualifying Capacity” has the meaning given in CAISO’s FERC-approved Tariff. “Notification Deadline” is twenty (20) Business Days before the relevant deadlines for the corresponding Compliance Showings applicable to the relevant Showing Month. “Planned Outage” means, subject to and as further described in the CPUC Decisions, a CAISO-approved, planned or scheduled disconnection, separation or reduction in capacity of the Unit that is conducted for the purposes of carrying out routine repair or maintenance of such Unit, or for the purposes of new construction work for such Unit. “Product” means RAR Attributes, Local RAR Attributes and FCR Attributes, each for the Delivery Period, Unit, Contract Quantity, Contract Price and other specifications contained in Appendix B. “Prorated Percentage of Unit Factor” means the percentage, as specified in Appendix B, of the Unit NQC as of the Effective Date that is dedicated to Purchaser under this Transaction. “Prorated Percentage of Unit Flexible Factor” means the percentage, as specified in Appendix B, of the Unit EFC as of the Effective Date that is dedicated to Purchaser under this Transaction. “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 power industry during the relevant time period in the Western United States, or (b) any of the practices, methods and acts which, in the exercise of reasonable judgment in light of the facts known at the time the decision was made, could have been expected to accomplish the desired result at a reasonable cost consistent with good business practices, reliability, safety and expedition. Prudent Operating Practice is not intended to be limited to the optimum practice, method or act to the exclusion of all others, but rather to acceptable practices, methods or acts generally accepted in the electric power industry in the Western United States. “RAR Attributes” means, with respect to a Shown Unit, any and all resource adequacy attributes of the Shown Unit, as may be identified from time to time by the CPUC, CAISO, or other Governmental Body having jurisdiction over Compliance Obligations, that can be counted toward an LSE’s RAR.
“Replacement Unit” hasthemeaning setforth in Section 2.3. “Resource Adequacy Requirements” or “RAR” means the resource adequacy requirements established for LSEs by the CPUC pursuant to the CPUC Decisions, by CAISO pursuant to the Tariff, or by any other Governmental Body having jurisdiction over Compliance Obligations, not including Local RAR or FCR.
“Resource Category” shall be as described in the annual CPUC Filing Guide, as such may be modified, amended, supplemented or updated from time to time.
Appendix A
Valley Electric
DocuSign DocuSign Envelope Envelope ID: EC3BF811 DAAFEA5C-DBB4 -ADA4-4A91 -460C-8752 -99D6-A8169027B457 -D0187607B12E Appendix A - 4
“SC” means Scheduling Coordinator as defined in the Tariff. “Showing Month” means the calendar month of the Delivery Period that isthe subject of the related Compliance Showing.
“Shown Unit” means the Unit, or any Replacement Unit meeting the requirements of Section 2.3 of this Confirmation and specified by Seller in a Supply Plan. “Subsequent Purchaser” means the purchaser of Product from Purchaser in a re-sale of Product by Purchaser.
“Substitute Capacity” has the meaning set forth in the Tariff for “RA Substitute Capacity”. “Tariff” means the CAISO Tariff, including any current CAISO-published “Operating Procedures” and “Business Practice Manuals,” in each case as amended or supplemented from time to time.
“Unit” means the generation unit described in Appendix B. A Unit or Shown Unit may not be a coal-fired generating facility.
“Unit EFC” means the lesser of the Unit’s Effective Flexible Capacity as set by CAISO as of the Effective Date and that of the Unit on a subsequent date of determination. “Unit NQC” means the lesser of the Unit’s Net Qualifying Capacity as set by CAISO as of the Effective Date and that of the Unit on a subsequent date of determination.
Appendix A
Valley Electric
DocuSign DocuSign Envelope Envelope ID: EC3BF811 DAAFEA5C-DBB4 -ADA4-4A91 -460C-8752 -99D6-A8169027B457 -D0187607B12E Appendix B - 1
APPENDIX B
PRODUCT AND UNIT INFORMATION
Product:
Appendix A
Valley Electric
DocuSign DocuSign Envelope Envelope ID: EC3BF811 DAAFEA5C-DBB4 -ADA4-4A91 -460C-8752 -99D6-A8169027B457 -D0187607B12E Appendix B - 2
Unit 1
Unit Specific Information
Resource Name BLM EAST Facility
Physical Location Inyo County
CAISO Resource ID BLM_2_UNITS
Unit NQC by month (e.g., Jan=50,Feb=65): 47
Unit EFC by month (e.g., Jan=30, Feb=50) 47
Resource Type (e.g., gas, hydro, solar, etc.) Geothermal Minimum Qualified Flexible Capacity
Category (Flex 1, 2 or 3) 1
TAC Area (e.g., PG&E, SCE) SCE
Capacity Area (CAISO System, Fresno,
Sierra, Kern, LA Basin, Bay Area,
Stockton, Big Creek-Ventura, NCNB, San
Diego-IV or Humboldt)
CAISO System
Resource Category as defined by the CPUC
(DR, 1, 2, 3, 4) 4
[Information for specific Shown Units may be provided after the Effective Date pursuant to the Confirmation.]
Appendix A Valley Electric
+
DocuSign DocuSign Envelope Envelope ID: EC3BF811 DAAFEA5C-DBB4 -ADA4-4A91 -460C-8752 -99D6-A8169027B457 -D0187607B12E Appendix C - 1
APPENDIX C
NOTICE INFORMATION
Seller: Silicon Valley Clean Energy
Authority
Purchaser: Valley Electric Association, Inc.
Appendix A
Valley Electric
DocuSign DocuSign Envelope Envelope ID: EC3BF811 DAAFEA5C-DBB4 -ADA4-4A91 -460C-8752 -99D6-A8169027B457 -D0187607B12E Appendix D - 1
APPENDIX D
PLANNED OUTAGE SCHEDULE
Unit Name CAISO
Resource ID *
Outage (MW)
SLIC
Outage
Start Date
SLIC
Outage
End Date
N/A N/A N/A N/A N/A
Appendix A
Valley Electric
DocuSign Envelope ID: 73F3633C-A83C-4366-94F8-CA2CB821F62F Nucleus:
(01) SENA (100814)
1 MASTER POWER PURCHASE AND SALE AGREEMENT
CONFIRMATION LETTER RESOURCE ADEQUACY
BETWEEN
SHELL ENERGY NORTH AMERICA (US), L.P.
AND
SILICON VALLEY CLEAN ENERGY AUTHORITY
This Confirmation Letter ("Confirmation") confirms the Transaction between Shell Energy North America (US), L.P., a Delaware limited partnership Seller and Silicon Valley Clean Energy Authority, a California joint powers authority Buyer , and each individually a Party and together the Parties , dated as of April 28, 2022 (the Confirmation Effective Date ) in which Seller agrees to provide to Buyer the right to the Product, as such term is defined in Article 3 of this Confirmation.
This Transaction is governed by the Edison Electric Institute Master Power Purchase and Sale Agreement between the Parties, effective as of November 28, 2016, along with any annexes (including Paragraph 10 of the Collateral Annex, as applicable) and amendments thereto (collectively, the Master Agreement ).
The Master Agreement and this Confirmation shall be collectively referred to herein as the Agreement .
Capitalized terms used but not otherwise defined in this Confirmation have the meanings ascribed to them in the Master Agreement or the Tariff (defined herein below).
ARTICLE 1. DEFINITIONS
1.1 Alternate Capacity means any replacement Product which Seller has elected to provide to Buyer in accordance with the terms of Section 4.5.
1.2 Applicable Laws means any law, rule, regulation, order, decision, judgment, or other legal or regulatory determination by any Governmental Body having jurisdiction over one or both Parties or this Transaction, including without limitation, the Tariff.
1.3 Availability Incentive Payments shall mean Availability Incentive Payments as defined in FERC filing ER09-1064 or such other similar term as modified and approved by FERC thereafter to be incorporated in the Tariff or otherwise applicable to CAISO.
1.4 Availability Standards shall mean the availability standards set forth in Section 40.9 of the Tariff.
1.5 Buyer has the meaning specified in the introductory paragraph hereof.
1.6 CAISO means the California Independent System Operator Corporation or its successor.
1.7 Capacity Replacement Price means (a) the price actually paid for any Replacement Capacity purchased by Buyer pursuant to Section 4.7 hereof, plus costs reasonably incurred by Buyer in purchasing such Replacement Capacity, or (b) absent a purchase of any Replacement Capacity, the market price for such Designated RA Capacity not provided at the Delivery Point. Buyer shall determine such market prices in a commercially reasonable manner. For purposes of Section 1.51 of the Master Agreement, Capacity Replacement Price shall be deemed to be the Replacement Price as used in the Master Agreement.
1.8 Confirmation has the meaning specified in the introductory paragraph hereof.
1.9 Confirmation Effective Date has the meaning specified in the introductory paragraph hereof.
1.10 Contingent Firm RA Product has the meaning specified in Section 3.2 hereof.
1.11 Contract Price means, for any Monthly Delivery Period, the price for such Monthly Delivery Period as specified in the RA Capacity Price Table set forth in Section 4.9.
1.12 Contract Quantity means, with respect to any particular Showing Month of the Delivery Period, the amount of Product (in MWs) set forth in Table in Section 4.3 which Seller has agreed to provide to Buyer from the Unit for such Showing Month.
Appendix A Shell Energy North America
(" __ ")
("
__ ")
the "Contract Quantity
DocuSign Envelope ID: 73F3633C-A83C-4366-94F8-CA2CB821F62F Nucleus:
(01) SENA (100814)
2 1.13 CPUC Decisions means, CPUC Decisions 04-01-050, 04-10-035, 05-10-042, 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 and subsequent decisions related to resource adequacy, as may be amended from time to time by the CPUC.
1.14 CPUC Filing Guide means the annual document issued by the CPUC which sets forth the guidelines, requirements and instructions for LSE s to demonstrate compliance with the CPUC s resource adequacy program.
1.15 Delivery Period has the meaning specified in Section 4.1 hereof.
1.16 Delivery Point has the meaning specified in Section 4.2 hereof.
1.17 Designated RA Capacity shall be equal to, for each day during any particular Showing Month of the Delivery Period, the Contract Quantity of Product for such Showing Month, including the amount of Contract Quantity that Seller has elected to provide Alternate Capacity with respect to, minus any reductions to Contract Quantity specified in Section 4.4 with respect to which Seller has not elected to provide Alternate Capacity.
1.18 Effective Flexible Capacity
1.19 Flexible Capacity Requirements FCR
for LSEs by the CPUC pursuant to the CPUC Decisions, or by an LRA or other Governmental Body having jurisdiction.
1.20 Flexible RA Product means Designated RA Capacity consisting of FCR Attributes, and, if applicable, LAR Attributes and/or RAR Attributes.
1.21 FCR Attributes , with respect to a Unit, any and all flexible resource adequacy attributes, as they are identified from time to time by the CPUC
Decisions, the Tariff, an LRA or other Governmental Body having jurisdiction, exclusive of any LAR Attributes and RAR Attributes.
1.22 FCR Showing FCR compliance showings (or similar or successor showings) an LSE is required to make to the CPUC (and, to the extent authorized by the CPUC, to the CAISO) pursuant to the CPUC Decisions and the Tariff, or to an LRA having jurisdiction over the LSE.
1.23 Generic RA Product
applicable, LAR Attributes, but not FCR Attributes.
1.24 Governmental Body means (i) any federal, state, local, municipal or other government; (ii) any governmental, regulatory or administrative agency, commission or other authority lawfully exercising or entitled to exercise any administrative, executive, judicial, legislative, police, regulatory or taxing authority or power; and (iii) any court or governmental tribunal.
1.25 LAR means local area reliability, which is any program of localized resource adequacy requirements established for jurisdictional LSEs by the CPUC pursuant to the CPUC Decisions, or by another LRA having jurisdiction over the LSE, as implemented in the Tariff. LAR may also be known as local resource adequacy, local RAR, or local capacity requirement in other regulatory proceedings or legislative actions.
1.26 LAR Attributes means, with respect to a Unit, any and all resource adequacy attributes (or other locational attributes related to system reliability), as they are identified from time to time by the CPUC Decisions, CAISO, LRA, or other Governmental Body having jurisdiction, associated with the physical location or point of electrical interconnection of such Unit within the CAISO Control Area, that can be counted toward LAR, exclusive of any RA Attributes which are not associated with where in the CAISO Control Area the Unit is physically located or electrically interconnected.
For clarity, it should be understood that if the CAISO, LRA, or other Governmental Body, defines new or re-defines existing local areas, then such change will not result in a change in payments made pursuant to this Transaction.
Appendix A Shell Energy North America
__________ " has the meaning specified for such term in the Tariff. ____________ " or " __ " means the flexible capacity requirements established ______ " means
that can be counted toward an LSE's FCR,
_____ " means the
_______ " means Designated RA Capacity consisting of RAR Attributes and, if DocuSign Envelope ID: 73F3633C-A83C-4366-94F8-CA2CB821F62F Nucleus:
(01) SENA (100814)
3 1.27 LAR Showings means the LAR compliance showings (or similar or successor showings) an LSE is required to make to the CPUC (and, to the extent authorized by the CPUC, to the CAISO) pursuant to the CPUC Decisions, or to an LRA having jurisdiction over the LSE.
1.28 LRA
1.29 LSE
1.30 Master Agreement has the meaning specified in the introductory paragraph hereof.
1.31 Monthly Delivery Period means each calendar month during the Delivery Period and shall correspond to each Showing Month.
1.32 Net Qualifying Capacity has the meaning set forth in the Tariff.
1.33 Non-Excusable Event any event, other than a Planned Outage and those events described under the definition of "Unit Firm" in the Master Agreement that excuse Seller's performance, that causes Seller to fail to perform its obligations under this Confirmation, including, without limitation, any such event resulting from (a) the negligence of the owner, operator or Scheduling Coordinator of a Unit, or (b) comply, or failure to cause the owner, operator or Scheduling Coordinator of the Units to comply, with the terms of the Tariff with respect to the Units providing RA Attributes, Flexible RA Attributes or LAR Attributes, as applicable.
1.34 Non-Availability Charges
1.35 Notification Deadline means, for each Showing Month, the date that is fifteen (15) Business Days before the earlier of the relevant deadlines for (a) the corresponding RAR Showings, FCR Showings and/or LAR Showings for such Showing Month, and (b) the Supply Plan filings applicable to that Showing Month.
1.36 Outage means any CAISO approved disconnection, separation, or reduction in the capacity of any Unit that relieves all or part of the offer obligations of the Unit consistent with the Tariff. For the avoidance of doubt, Outage shall be deemed to include Planned Outage (defined below).
1.37 Planned Outage means, subject to and as further described in the Tariff, a CAISO-approved planned or scheduled disconnection, separation or reduction in capacity of the Unit that is conducted for the purposes of carrying out routine repair or maintenance of such Unit.
1.38 Product has the meaning specified in Article 3 hereof.
1.39 RA Capacity means the qualifying and deliverable capacity of the Unit for RAR and, if applicable, LAR, and FCR purposes for the Delivery Period, as determined by the CAISO or other Governmental Body authorized to make such determination under Applicable Laws. RA Capacity encompasses the applicable RA Attributes, and if applicable, LAR Attributes and FCR Attributes of the capacity provided by a Unit.
1.40 RA Capacity Payment
1.41 RAR means the resource adequacy requirements, exclusive of LAR established for LSEs by the CPUC pursuant to the CPUC Decisions, or by an LRA or other Governmental Body having jurisdiction.
1.42 RAR Attributes
identified and existing as of the Confirmation Date by the Tariff, CPUC Decisions, LRA, or any Governmental Body having jurisdiction that can be counted toward RAR, exclusive of any LAR Attributes and FCR Attributes.
1.43 RAR Showings means the RAR compliance showings (or similar or successor showings) an LSE is required to make to the CPUC (and/or, to the extent authorized by the CPUC, to the CAISO), pursuant to the Tariff or CPUC Decisions, or to an LRA having jurisdiction.
1.44 Replacement Capacity has the meaning specified in Section 4.7 hereof. .
Appendix A Shell Energy North America
" __ " has the meaning set for in the Tariff for the term "Local Regulatory Authority". " __ " has the meaning specified in the Tariff for the term "Load Serving Entity". ________ "means
Seller's failure to
_________ " are as defined in the Tariff _
________ " has the meaning specified in Section 4.9 hereof. ______ " means, with respect to a Unit, any and all resource adequacy attributes, as DocuSign Envelope ID: 73F3633C-A83C-4366-94F8-CA2CB821F62F Nucleus:
(01) SENA (100814)
4 1.45 Replacement Unit means any generating unit having comparable RAR Attributes, LAR Attributes and, if applicable, FCR Attributes to the Unit(s), meeting the requirements for a Unit specified herein and meeting the requirements specified in Section 4.5.
1.46 Resource Category shall be as described in the CPUC Filing Guide, as such may be modified, amended, supplemented or updated from time to time.
1.47 Scheduling Coordinator has the same meaning as in the Tariff.
1.48 Seller has the meaning specified in the introductory paragraph hereof.
1.49 Showing Month shall be the calendar month during the Delivery Period that is the subject of the RAR Showing, LAR Showing, and/or FCR Showing, as applicable, as set forth in the CPUC Decisions or Tariff. For illustrative purposes only, the monthly RAR Showing made in June is for the Showing Month of August.
1.50 Supply Plan has the meaning specified in the Tariff.
1.51 Tariff means the tariff and protocol provisions of the CAISO, as amended or supplemented from time to time. For purposes of Article 5, the Tariff refers to the tariff and protocol provisions of the CAISO as they exist on the Confirmation Effective Date.
1.52 Transaction has the meaning specified in the introductory paragraph hereof.
1.53 Unit or Units shall mean the generation assets described in Article 2 hereof (including any Replacement Units), from which RA Capacity is provided by Seller to Buyer.
1.54 Unit EFC Effective Flexible Capacity set by the CAISO for the applicable Unit. If the CAISO adjusts the Unit EFC after the Confirmation Effective Date, then for the period in which the adjustment is effective, the Unit EFC shall be deemed the lessor of (i) the Unit EFC as of the Confirmation Effective Date, or (ii) the CAISO-adjusted Effective Flexible Capacity.
1.55 Unit NQC means the Net Qualifying Capacity set by the CAISO for the applicable Unit. If the CAISO adjusts the Net Qualifying Capacity of a Unit after the Confirmation Effective Date, then for the period in which the adjustment is effective, the Unit NQC shall be deemed the lesser of (i) the Unit NQC as of the Confirmation Effective Date, or (ii) the CAISO-adjusted Net Qualifying Capacity.
Appendix A Shell Energy North America
___ "means the
DocuSign Envelope ID: 73F3633C-A83C-4366-94F8-CA2CB821F62F Nucleus:
(01) SENA (100814)
5 ARTICLE 2. UNIT INFORMATION
Name Colgate Hydro Unit 2
Location Yuba County, CA
CAISO Resource ID COLGAT_7_UNIT 2
Unit SCID YCWA
Unit NQC Varies By Month
Unit EFC Varies By Month
Resource Type Hydro
Resource Category (1, 2, 3 or 4) 4
Flexible RAR Category (1, 2 or 3) N/A
Path 26 (North or South) North
Local Capacity Area (if any, as of
Confirmation Effective Date) Sierra
Deliverability restrictions, if any, as
described in most recent CAISO
deliverability assessment
None
Run Hour Restrictions None
ARTICLE 3. RESOURCE ADEQUACY CAPACITY PRODUCT
3.1 During the Delivery Period, Seller shall provide to Buyer, pursuant to the terms of this Confirmation, the Designated RA Capacity in accordance with the product types selected in Section 3.2 (the Product ) and the Contract Quantity set forth in Section 4.3. The Product does not confer to Buyer any right to the electrical output from the Units, other than the right to include the Designated RA Capacity associated with the Contract Quantity in RAR Showings, LAR Showings, and/or FCR Showings, as applicable, and any other capacity or resource adequacy markets or proceedings as specified in this Confirmation. Specifically, no energy or ancillary services associated with any Unit is required to be made available to Buyer as part of this Transaction and Buyer shall not be responsible for compensating Seller for Seller s commitments to the CAISO required by this Confirmation. Seller retains the right to sell any pursuant to the Tariff any RA Capacity from a Unit in excess of that Unit s Contract Quantity and any RA Attributes, LAR Attributes or FCR Attributes not otherwise transferred, conveyed, or sold to Buyer under this Confirmation.
3.2 Product Type
Flexible RA Product
The Designated RA Capacity is a Flexible RA Product. For avoidance of doubt, the Flexible RA Product to be delivered by Seller to Buyer hereunder shall include the following Product attributes:
[ ] FCR Attributes with LAR Attributes
[ ] FCR Attributes with RAR Attributes
Generic RA Product
The Designated RA Capacity is a Generic RA Product. For avoidance of doubt, the Generic RA Product to be delivered by Seller to Buyer hereunder shall include the following Product attributes:
[X] RAR Attributes
[ ] LAR Attributes
Appendix A Shell Energy North America
□
DocuSign Envelope ID: 73F3633C-A83C-4366-94F8-CA2CB821F62F Nucleus:
(01) SENA (100814)
6 3.3 Delivery Obligation
Contingent Firm RA Product
Seller shall provide Buyer with Designated RA Capacity from the Units. If those Units are not able to provide the full amount of the Contract Quantity as a result of a Non-Excusable Event, then, subject to Section 4.4, Seller shall have the option to notify Buyer in writing by the Notification Deadline that either (a) Seller will not provide the full Contract Quantity during the period of such non-availability; or (b) Seller will supply Alternate Capacity to fulfill the remainder of the Contract Quantity during such period. If Seller fails to provide Buyer with the Contract Quantity as a result of a Non-Excusable Event and has failed to notify Buyer in writing by the Notification Deadline that it will not provide the full Contract Quantity during the period of such non availability as provided in Section 4.4, then Seller shall be liable for damages and/or required to indemnify Buyer for any resulting penalties or fines pursuant to the terms of Sections 4.7 and
4.8 hereof. Notwithstanding anything herein to the contrary, if Seller provides less than the full amount of the Contract Quantity for any reason other than a Non-Excusable Event or in accordance with Section 4.4, and Seller provides notice of such by the Notification Deadline, Seller is not obligated to provide Buyer with Alternate Capacity or to indemnify Buyer for any resulting penalties or fines. The Product is a Contingent Firm RA Product, and with respect to
Firm RA Product
Seller shall provide Buyer with Designated RA Capacity from the Unit(s) in the amount of the Contract Quantity. If the Units are not available to provide the full amount of the Contract Quantity for any reason other than Force Majeure, including without limitation any Outage or any adjustment of the RA Capacity of any Unit, pursuant to Section 4.4, then, Seller shall provide Buyer with Designated RA Capacity from one or more Replacement Units pursuant to Section 4.5 hereof. If Seller fails to provide Buyer with replacement Designated RA Capacity from Replacement Units pursuant to Section 4.5, then Seller shall be liable for damages and/or required to indemnify Buyer for penalties or fines pursuant to the terms of Sections 4.7 and 4.8 hereof.
ARTICLE 4. DELIVERY AND PAYMENT
4.4 Adjustments to Contract Quantity
(a) Planned Outages: If Seller is unable to provide the applicable Contract Quantity for all or a portion of a Showing Month due to a Planned Outage of a Unit, then Seller shall have the option, but not the obligation, upon written notice to Buyer by the Notification Deadline, to either (a) reduce the Contract Quantity in accordance with the Planned Outage for such portion of the Showing Month; or (b) provide Alternate Capacity up to the Contract Quantity for the applicable portion of such Showing Month.
Appendix A Shell Energy North America
this Contingent Firm RA Product, "Contingent Firm" shall have the same meaning as "Unit Firm" in the Master Agreement.
□----
DocuSign Envelope ID: 73F3633C-A83C-4366-94F8-CA2CB821F62F Nucleus:
(01) SENA (100814)
7 (b) Reductions in Unit NQC: If the Product is both (i) Generic RA Product, and (ii) Contingent Firm RA Product, then Seller s obligation to deliver the applicable Contract Quantity for any Showing Month may also be reduced by Seller if the Unit experiences a reduction in Unit NQC as determined by the CAISO. If the Unit experiences such a reduction in Unit NQC then Seller has the option, but not the obligation, upon written notice to Buyer by the Notification Deadline, to provide the applicable Contract Quantity for such Showing Month from (i) the same Unit, provided the Unit has sufficient remaining and available Product, and/or (ii) from Replacement Units, provided, that in each case Seller provides and identifies such Replacement Units in accordance with Section 4.5. (c) If Product is both (i) Flexible RA Product specified under Section 3.2, and (ii) Contingent applicable Contract Quantity for any Showing Month may also be reduced if the Unit experiences a reduction in Unit EFC or Unit NQC as determined by the CAISO. If the Unit experiences such a reduction in Unit EFC or Unit NQC, then Seller has the option, but not the obligation, to provide the applicable Contract Quantity for such Showing Month from (i) the same Unit, provided the Unit has sufficient remaining and available Product and/or (ii) Alternate Capacity up to the Contract Quantity.
4.5 Alternative Capacity and Replacement Units
(a) If Seller elects or is unable to provide the full Contract Quantity for any Showing Month for any reason, including, without limitation, due to one of the reasons specified in Section 4.4, or Seller desires to provide the Contract Quantity for any Showing Month from a different generating unit other than the Unit, then Seller, at no additional cost to Buyer, may provide Buyer with Alternate Capacity from one or more Replacement Units, with the total amount of Product provided to Buyer from the Unit and Replacement Units up to an amount equal to the Contract Quantity for the applicable Showing Month; provided that in each case, Seller shall notify Buyer in writing of such Replacement Units no later than the Notification Deadline. If Seller notifies Buyer in writing as to the particular Replacement Units and such Units meet the requirements of this Section 4.5, then such Replacement Units shall be automatically deemed a Unit for purposes of this Confirmation for the remaining portion of that Showing Month. that Showing Month and Seller shall not be liable to Buyer or any other party for damages, including any cover costs, and/or required to indemnify Buyer for costs, penalties or fines pursuant to the terms of Sections 4.7 and 4.8 hereof if and only if Seller
not to provide Alternate Capacity in an amount equal to the Contract Quantity of that Showing Month.
(b) If Seller is unable to provide the full Contract Quantity for any Showing Month for any reason, including, without limitation, due to one of the reasons specified in Section 4.4 and Seller does not provide Alternate Capacity in an amount equal to that which allows Seller to provide the full Contract Quantity for that Showing Month, then Buyer may, but shall not be required to, purchase Replacement Capacity.
4.6 Delivery of Product
Seller shall provide Buyer with the Designated RA Capacity of Product for each Showing Month consistent with the following:
Seller shall, on a timely basis, submit, or cause the Unit s Scheduling Coordinator to submit, Supply Plans to identity and confirm the Designated RA Capacity provided to Buyer for each Showing Month so that the total amount of Designated RA Capacity identified and confirmed for such Showing Month equals the Designated RA Capacity, unless specifically requested not to do so by Buyer.
4.7 Damages for Failure to Provide Designated RA Capacity If Seller fails to provide Buyer with the Designated RA Capacity of Product for any Showing Month, and such failure is not excused under the terms of the Confirmation, then the following shall apply:
Appendix A Shell Energy North America
Firm RA Product specified under Section 3.3, then Seller's obligation to deliver the has provided Buyer with timely notice pursuant to this Section 4.5(a) of Seller's intent DocuSign Envelope ID: 73F3633C-A83C-4366-94F8-CA2CB821F62F Nucleus:
(01) SENA (100814)
8 (a) Buyer may, but shall not be required to, replace any portion of the Designated RA Capacity not provided by Seller with capacity having equivalent RA Attributes, LAR Attributes and/or FCR Attributes as the Designated RA Capacity not provided by Seller; provided, however, that if any portion of the Designated RA Capacity that Buyer is seeking to replace is Designated RA Capacity having solely RAR Attributes and no LAR Attributes or FCR Attributes, and no such RA Capacity is available, then Buyer may replace such portion of the Designated RA Capacity with capacity having any applicable FCR Attributes and/or LAR Attributes ( Replacement Capacity ). Buyer may enter into purchase transactions with one or more parties to replace any portion of Designated RA Capacity not provided by Seller so long as such transactions are done at prevailing market prices. Additionally, Buyer may enter into one or more arrangements to repurchase its obligation to sell and deliver capacity to another party, and, to the extent such transactions are done at prevailing market prices, such arrangements shall be considered equivalent to the procurement of Replacement Capacity. Buyer shall use commercially reasonable efforts to minimize damages when procuring any Replacement Capacity.
(b) Seller shall pay to Buyer an amount equal to the positive difference, if any, between (i) the sum of (A) the Replacement Capacity times the Capacity Replacement Price, and (B) the Designated RA Capacity not provided by Seller (less any Replacement Capacity) times the Capacity Replacement Price; and (ii) the Designated RA Capacity not provided by Seller times the Contract Price for that month. If Seller fails to pay these damages, then Buyer may in addition to any other remedies that may be available to Buyer, offset those damages owed it against any future amounts it may owe to Seller under this Confirmation pursuant to Article 6 of the Master Agreement. Seller will not be in breach of this Confirmation for any failure to provide any Designated RA Capacity so long as Seller complies with the provisions of this Section 4.7.
4.8 Indemnities for Failure to Deliver Contract Quantity Subject to any adjustments made pursuant to Section 4.4, Seller agrees to indemnify, defend and hold harmless Buyer from any penalties, fines or costs assessed against Buyer by the CPUC or the CAISO, resulting from any of the following:
(a) Seller s failure to provide any portion of the Designated RA Capacity if such failure is not ;
(b) Seller s failure to provide notice of the non-availability of any portion of Designated RA Capacity as required under Sections 4.5; or
(c) A Unit Scheduling Coordinator s failure to timely submit accurate Supply Plans that identify Buyer s right to the Designated RA Capacity purchased hereunder.
With respect to the foregoing, the Parties shall use commercially reasonable efforts to minimize such penalties, fines and costs; provided, that in no event shall Buyer be required to use or change its utilization of its owned or controlled assets or market positions to minimize these penalties and fines. If Seller fails to pay the foregoing penalties, fines or costs, or fails to reimburse Buyer for those penalties, fines or costs, then Buyer may, in addition to any other remedies that may be available to Buyer, offset those penalties, fines or costs against any future amounts it may owe to Seller under this Confirmation.
4.9 RA Capacity Payment
In accordance with the terms of Article 6 of the Master Agreement, Buyer shall make an RA Capacity Payment to Seller for each Unit, in arrears, after the applicable Showing Month. The RA Capacity Payment shall be equal to the sum for each day during the Showing Month of the product of (a) the applicable Contract Price for such Showing Month, multiplied by (b) the Designated RA Capacity for the Monthly Delivery Period, multiplied by (c) 1,000. The final product of this RA Capacity Payment calculation shall be rounded to the nearest penny (i.e., two decimal places); provided, however, that the Monthly RA Capacity Payment shall be prorated to reflect any portion of Designated RA Capacity that was not delivered pursuant to Section 4.4 at the time of the CAISO filing for the respective Showing Month.
Appendix A Shell Energy North America
excused under the terms of the Product or by Buyer's failure to perform DocuSign Envelope ID: 73F3633C-A83C-4366-94F8-CA2CB821F62F Nucleus:
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9 RA Capacity Price Table
4.10 Allocation of Other Payments and Costs
Seller shall be entitled to receive and retain all revenues that Buyer is not expressly entitled to receive pursuant to this Agreement, including all revenues that Seller may receive from the CAISO or any other third party with respect to any Unit for (a) start-up, shut-down, and minimum load costs, (b) revenue for ancillary services, (c) energy sales, (d) any revenues for black start or reactive power services, or (e) the sale of the unit-contingent call rights on the generation capacity of the Unit to provide energy to a third party, so long as such rights do not confer on such third party the right to claim any portion of the RA Capacity sold hereunder in order to make an RAR Showing, LAR Showing, FCR Showing, or any similar capacity or resource adequacy showing with the CAISO or CPUC. Buyer acknowledges and agrees that all Availability Incentive Payments are for the benefit of Seller and for Seller s account, and that Seller shall receive, retain, or be entitled to receive all credits, payments, and revenues, if any, resulting from Seller achieving or exceeding Availability Standards. The Parties acknowledge and agree that any Non-Availability Charges are the responsibility of Seller, and for Seller s account and Seller shall be responsible for all fees, charges, or penalties, if any, resulting from Seller failing to achieve Availability Standards. If a centralized capacity market develops within the CAISO region, Buyer will have exclusive rights to offer, bid, or otherwise submit Designated RA Capacity provided to Buyer pursuant to this Confirmation for re-sale in such market, and retain and receive any and all related revenues.
ARTICLE 5. CAISO OFFER REQUIREMENTS
During the Delivery Period, except to the extent any Unit is in an Outage, or is affected by an event of Force Majeure that results in a partial or full outage of that Unit, Seller is responsible for either scheduling or causing the Unit s Scheduling Coordinator to schedule with, or make available to, the CAISO each Unit s Designated RA Capacity in compliance with the Tariff, and performing, or causing the Unit s Scheduling Coordinator, owner, or operator, as applicable, to perform all obligations under the Tariff that are associated with the sale of Designated RA Capacity hereunder. Buyer shall have no liability for the failure of Seller or the failure of any Unit s Scheduling Coordinator, owner, or operator to comply with such Tariff provisions, including any penalties or fines imposed on Seller or the Unit s Scheduling Coordinator, owner, or operator for such noncompliance.
ARTICLE 6. CHANGE IN LAW
If any statutes, rules, regulations, permits or authorizations are enacted, amended, granted or revoked which have the effect of changing the transfer and sale procedure for Product set forth in this Confirmation so that the implementation of this Confirmation becomes impossible or impracticable, or if a new product that is a derivative of the Product(s) contracted for herein is created, the Parties hereto agree to negotiate in good faith to amend this Confirmation, to conform with such new statutes, regulations, or rules in order to maintain the original intent of the Parties under this Confirmation or to provide Buyer with Product pursuant to another program if possible; provided, however, that neither Party shall be obligated to enter into any such amendment except in its sole discretion.
ARTICLE 7. OTHER BUYER AND SELLER COVENANTS
7.1 Further Assurances
Buyer and Seller shall, throughout the Delivery Period, take all commercially reasonable actions and execute any and all documents or instruments reasonably necessary to ensure Buyer s right to the use of Appendix A
Shell Energy North America
DocuSign Envelope ID: 73F3633C-A83C-4366-94F8-CA2CB821F62F Nucleus:
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10 the Contract Quantity for the sole benefit of Buyer s applicable RAR, LAR and/or FCR, as applicable, including, without limitation:
(a) Cooperating with and providing, and in the case of Seller causing each Unit s Scheduling Coordinator, owner, or operator to cooperate with and provide requested supporting documentation to the CAISO, the CPUC, or any other Governmental Body responsible for administering RAR, LAR, and/or FCR under Applicable Laws, to certify or qualify the Contract Quantity as RA Capacity and Designated RA Capacity. Such actions shall include, without limitation, providing information requested by the CAISO, CPUC, or by an LRA having jurisdiction, to demonstrate for each month of the Delivery Period the ability to deliver the Contract Quantity from each Unit to the CAISO Controlled Grid for the minimum hours required to qualify as RA Capacity, and providing information requested by the CPUC, the CAISO or other Governmental Body having jurisdiction to administer the applicable RAR, LAR and FCR to demonstrate that the Contract Quantity can be delivered to the CAISO Controlled Grid pursuant to the deliverability standards established by the CAISO or other Governmental Body having jurisdiction to administer RAR, LAR and/or FCR; and
(b) Negotiating in good faith to make necessary amendments, if any, to this Confirmation, which remain e discretion, to
conform this Transaction to subsequent clarifications, revisions, or decisions rendered by the CPUC, FERC, or other Governmental Body having jurisdiction to administer the applicable RAR or FCR so as to maintain the purpose and intent of the Transaction agreed to by the Parties on the Confirmation Effective Date.
7.2 Seller Representations and Warranties
Seller represents, warrants and covenants to Buyer that, throughout the Delivery Period:
(a) Seller owns or has the exclusive right to the RA Capacity sold under this Confirmation from each Unit, and shall furnish Buyer, the CAISO, CPUC, or other jurisdictional LRA of or other Governmental Body with such evidence as may reasonably be requested to demonstrate such ownership or exclusive right;
(b) No portion of the Contract Quantity has been committed by Seller to any third party in order to satisfy RAR, LAR, FCR or analogous obligations in CAISO markets, other than pursuant to an RMR Agreement between the CAISO and either Seller or the Unit s owner or operator;
(c) No portion of the Contract Quantity has been committed by Seller in order to satisfy RAR, LAR, FCR, or analogous obligations in any non-CAISO market; (d) Each Unit is connected to the CAISO Controlled Grid, is within the CAISO Control Area, or is under the control of CAISO;
(e) The owner or operator of each Unit is obligated to comply with Applicable Laws, including the Tariff, relating to RA Capacity, RAR, LAR and FCR;
(f) If Seller is the owner of any Unit, the cumulative amounts of LAR Attributes, RAR Attributes and FCR Attributes that Seller has sold, assigned or transferred for any Unit does not exceed that Unit s RA Capacity;
(g) With respect to the RA Capacity provided under this Confirmation, Seller shall, and each Unit s Scheduling Coordinator is obligated to, comply with Applicable Laws, including the Tariff, relating to RA Capacity, RAR, LAR and FCR;
(h) Seller has notified the Scheduling Coordinator of each Unit that Seller has transferred the Designated RA Capacity to Buyer, and the Scheduling Coordinator is obligated to deliver the Supply Plans in accordance with the Tariff;
(i) Seller has notified the Scheduling Coordinator of each Unit that Seller is obligated to cause each Unit s Scheduling Coordinator to provide to Buyer, no later than the Notification Appendix A Shell Energy North America
subject to agreement of such Parties, in each Party's sol DocuSign Envelope ID: 73F3633C-A83C-4366-94F8-CA2CB821F62F Nucleus:
(01) SENA (100814)
11 Deadline, of the Designated RA Capacity of each Unit that is to be submitted in the Supply Plan associated with this Agreement for the applicable period; and (j) Seller has notified each Unit s Scheduling Coordinator that Buyer is entitled to the revenues set forth in Section 4.10 of this Confirmation, and such Scheduling Coordinator is obligated to promptly deliver those revenues to Buyer, along with appropriate documentation supporting the amount of those revenues.
ARTICLE 8. CONFIDENTIALITY
Notwithstanding any agreement or obligation of confidentiality or non-disclosure between Buyer and Seller, the Parties agree that Buyer may disclose the Designated RA Capacity under this Transaction to any Governmental Body, the CPUC, the CAISO or any LRA having jurisdiction in order to support its LAR Showings, RAR Showings and/or FCR Showings, as applicable, and Seller may disclose the transfer of the Designated RA Capacity under this Transaction to the SC of each Unit in order for such SC to timely submit accurate Supply Plans. In addition, If Buyer becomes legally compelled (by interrogatories, requests for information or documents, subpoenas, summons, civil investigative demands, or similar processes or otherwise in connection with any litigation or to comply with any applicable law, order, regulation, ruling, regulatory request, accounting disclosure rule or standard or any exchange, control area or independent system operator rule, or a request to Buyer under the California Public Records Act (California Government Code Section 6250 et seq.)) to disclose any confidential information of Seller, Buyer may do so after providing Seller with prompt notice so that Seller, at its sole expense, may seek an appropriate protective order or other appropriate remedy against disclosure. Notwithstanding anything to the contrary in Section
10.11 of the Master Agreement, Buyer may make portions of this Confirmation available to the public as his Transaction.
ARTICLE 9. BUYER S RE-SALE OF PRODUCT
Buyer may re-sell all or a portion of the Product hereunder. In the event of any such re-sale, Seller shall (and their
respective Scheduling Coordinators) to allow such transferee to utilize the re-sold Product.
ARTICLE 10. MARKET BASED RATE AUTHORITY
Seller shall, in accordance with Federal Energy Regulatory Commission (FERC) Order No. 697, submit a letter of concurrence in support of any affirmative statement by Buyer that this contractual arrangement does not transfer ownership or control of generation capacity from Seller to Buyer as the term ownership or control of generation capacity is used in 18 CFR Section 35.42. Seller shall not, in filings, if any, made subject to Order Nos. 652 and 697, claim that this contractual arrangement conveys ownership or control of generation capacity from Seller to Buyer.
ARTICLE 11. COLLATERAL REQUIREMENTS
The Parties further agree that for the purposes of calculating the Collateral Requirement pursuant to Paragraph 3 of the Collateral Annex, the Current Mark-to-Market Value for this Transaction is deemed to be zero.
Appendix A Shell Energy North America
part of Buyer's process of seeking approval from its Board of Directors for t cause its Scheduling Coordinator to cooperate reasonably with Buyer and Buyer's transferee Upon Buyer's written request,
DocuSign Envelope ID: 73F3633C-A83C-4366-94F8-CA2CB821F62F Nucleus:
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12 ACKNOWLEDGED AND AGREED TO AS OF THE CONFIRMATION EFFECTIVE DATE.
SHELL ENERGY NORTH AMERICA (US), L.P. SILICON VALLEY CLEAN ENERGY AUTHORITY By: By:
Name: John W. Pillion Name:
Title: Confirmations Team Lead Title:
Date: 5.2.22 Date:
Appendix A Shell Energy North America
DocuSigned by:
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4/ 28/ 2022
DocuSign DocuSign DocuSign Envelope Envelope Envelope ID: 0060B0B4 49E8E252 24FF9126--138D 932F E2C8--447FC39 4E16---9DA3 A974 A568--49F5ED091B36 A590BEF4BD88 DACD6A887454 1 WSPP RESOURCE ADEQUACY CONFIRMATION
This confirmation (“Confirmation”) under the WSPP Agreement confirms the transaction between Silicon Valley Clean Energy Authority, a California joint powers authority (“Purchaser” or “SVCE”) and Elk Hills Power, LLC (“EHP” or “Seller”) dated as of May 12, 2022 (the “Effective Date”), by which Seller agrees to sell and deliver, and Purchaser agrees to purchase and receive, the Product (the “Transaction”).
Capitalized terms not otherwise defined in this Confirmation or the WSPP Agreement are defined in the Tariff.
ARTICLE 1
TRANSACTION TERMS
Purchaser: SVCE
Seller: EHP
Product, Delivery Period, Contract Quantity, Contract Price and other specifics of the Product are in Appendix B. Appendices A, B and C are incorporated into this Confirmation.
ARTICLE 2
DELIVERY OBLIGATIONS AND ADJUSTMENTS
2.1 Sale and Delivery of Product
(a) For each Showing Month of the Delivery Period, Seller will sell and deliver to Purchaser, and Purchaser will purchase and receive from Seller, the Contract Quantity of the Product from the Shown Unit(s).
(b) Seller will deliver the Contract Quantity of Product by submitting to CAISO in its Supply Plan the Shown Unit and the characteristics of the Shown Unit and Product for Purchaser, as further specified in Appendix B, all in compliance with this Confirmation. (c) Seller will cause all Supply Plans to meet and be filed in conformance with the requirements of the Tariff. Seller will submit, or cause the Unit’s SC to submit, on a timely basis with respect to each applicable Showing Month, Supply Plans in accordance with the Tariff and CPUC requirements to identify and confirm the Product delivered to Purchaser for each Showing Month of the Delivery Period. The total amount of Product identified and confirmed for each day of such Showing Month will equal the Contract Quantity, less any excused deductions to the Contract Quantity in the case of Flexible RA Capacity for excused reductions in Unit EFC.
(d) Seller may sell and deliver from a Shown Unit that meets requirements set forth in Appendix B, including the Resource Category and, if applicable, the Flexible Capacity Category. Seller will identify the Shown Unit(s) and Contract Quantity by providing Purchaser with the specific Unit information contemplated in Appendix B no later than the Notification Deadline for the relevant Showing Month.
(e) If CAISO rejects either the Supply Plan or the Resource Adequacy Plan with respect to any part of the Contract Quantity for the Shown Unit in any Showing Month, the Parties will confer, make such corrections as are necessary for acceptance, and resubmit the corrected Appendix A
Elk Hills Power, LLC
DocuSign DocuSign DocuSign Envelope Envelope Envelope ID: 0060B0B4 49E8E252 24FF9126--138D 932F E2C8--447FC39 4E16---9DA3 A974 A568--49F5ED091B36 A590BEF4BD88 DACD6A887454 2 Supply Plan or Resource Adequacy Plan for validation before the applicable deadline for the Showing Month.
(f) The Product is delivered by Seller and received by Purchaser when either (i) the CIRA Tool shows the Supply Plan accepted for the Contract Quantity of Product from the Shown Unit by CAISO or (ii) Seller complies with Purchaser’s instruction to withhold all or part of the Contract Quantity from Seller’s Supply Plan for any Showing Month during the Delivery Period. Seller has failed to deliver the Product if (i) Purchaser has elected to submit the Product from the Shown Unit in its Resource Adequacy Plan and such submission is accepted by the CPUC and the CAISO but the Supply Plan and Resource Adequacy Plan are not matched in the CIRA Tool and are rejected by CAISO notwithstanding performance of Section 1(e) or (ii) Seller fails to submit the volume of Contract Quantity for any Showing Month in such amount as instructed by Purchaser for the applicable Showing Month. Purchaser will have received the Contract Quantity if (x) Seller’s Supply Plan is accepted by the CAISO for the applicable Showing Month or (y) Seller complies with Purchaser’s instruction to withhold all or part of the Contract Quantity from Seller’s Supply Plan for the applicable Showing Month. Seller will not have failed to deliver the Contract Quantity if Purchaser fails or chooses not to submit the Shown Unit and the Product in its Resource Adequacy Plan with the CPUC or CAISO. (g) Excused Reductions in Unit EFC: Unless the Parties have designated this Section 2.1(g) as “Not applicable”, if the Product includes FCR Attributes, then Seller’s failure to deliver any of the Contract Quantity of FCR Attributes during the Delivery Period will be excused if the Unit experiences a reduction in Unit EFC after the Effective Date as determined by CAISO and Seller has provided notice of such reduction to Purchaser by the Notification Deadline for the applicable Showing Month. The extent to which Seller’s failure is excused will equal (i) the Contract Quantity of FCR Attributes for such day multiplied by (ii) the total amount (in MW) by which the Unit EFC was reduced since the Effective Date, divided by (iii) the Unit EFC as of the Effective Date. If the Unit experiences such a reduction in Unit EFC, then Seller may, but is not obligated to, provide the applicable part of the Contract Quantity of FCR Attributes for such day from the Shown Unit.
2.2 Purchaser’s Remedies for Seller’s Failure to Deliver Contract Quantity (a) If Seller fails to deliver any part of the Contract Quantity as required herein for any Showing Month, and such failure is not excused under the terms of this Confirmation or by Purchaser’s failure to perform, then Seller shall owe Purchaser, on the date payment would otherwise be due in respect of the month in which the failure occurred, an amount for such deficiency equal to the positive difference, if any, obtained by subtracting the Contract Price from the Replacement Price.
(b) Seller agrees to indemnify, defend and hold harmless Purchaser from any penalties, fines or costs, assessed against Purchaser by the CPUC, CAISO or other Governmental Body resulting from Seller’s failure to deliver the Product. The Parties will use commercially reasonable efforts to minimize such penalties, fines or costs; provided, that in no event will Purchaser be required to use or change its utilization of its owned or controlled assets or market positions to minimize these penalties, fines or costs. If Seller fails to pay the foregoing penalties, fines or costs, or fails to reimburse Purchaser for those penalties, fines or costs, then, without prejudice to its other rights and remedies, Purchaser may setoff and recoup those penalties, fines or costs against any future amounts it may owe to Seller under this Confirmation or the WSPP Agreement.
Appendix A
Elk Hills Power, LLC
DocuSign DocuSign DocuSign Envelope Envelope Envelope ID: 0060B0B4 49E8E252 24FF9126--138D 932F E2C8--447FC39 4E16---9DA3 A974 A568--49F5ED091B36 A590BEF4BD88 DACD6A887454 3 2.3 Purchaser’s Re-Sale of Product
(a) Purchaser may re-sell all or part of the Contract Quantity of Product; provided that any such re-sale must not increase or modify Seller’s obligations hereunder other than as set forth in this Section 2.3(a). For any such a resale, Resource Adequacy Plan of Purchaser as used herein will refer to the Resource Adequacy Plan of Subsequent Purchaser. Seller will, or will cause the Unit’s SC, to follow Purchaser’s instructions with respect to providing such resold Product to Subsequent Purchasers, to the extent such instructions are consistent with Seller’s obligations under this Confirmation. Seller will, and will cause the Unit’s SC, to take all commercially reasonable actions and execute all documents or instruments reasonably necessary to allow such Subsequent Purchasers to use such resold Product in a manner consistent with Purchaser’s rights under this Confirmation. If Purchaser incurs any liability to a Subsequent Purchaser due to the failure of Seller or the Unit’s SC to comply with this Confirmation, Seller will be liable to Purchaser for the same amounts Seller would have owed Purchaser under this Confirmation if Purchaser had not resold the Product.
(b) Purchaser will notify Seller in writing of any resale of Product and the Subsequent Purchaser no later than two Business Days before the Notification Deadline for the Showing Month. Purchaser will notify Seller of any subsequent changes or further resales no later than two Business Days before the Notification Deadline for the Showing Month.
ARTICLE 3
PAYMENTS
3.1 Payment
(a) Purchaser shall pay for the Product as provided in Article 9 of the WSPP Agreement and this Confirmation; except that under Section 9.4 of the WSPP Agreement, in case any portion of any bill is in dispute, then only the undisputed portion of the bill shall be paid when due. The disputed portion of the bill shall be adjusted or paid upon final resolution of the dispute. Purchaser shall make a monthly payment to Seller for each Unit by the later of (i) ten (10) Calendar Days after Purchaser’s receipt of Seller’s invoice (which may be given upon first day of the Showing Month) and (ii) the twentieth (20th) of the Showing Month, or if the twentieth (20th) is not a Business Day the next following Business Day (“Monthly RA Capacity Payment”). The Monthly RA Capacity Payment shall equal the product of (a) the applicable Contract Price for that Showing Month, (b) the Contract Quantity for the Showing Month and (c) 1,000, rounded to the nearest penny (i.e., two decimal places); provided, however, that the Monthly RA Capacity Payment shall be adjusted to reflect any portion of Contract Quantity for the Showing Month that was not delivered in accordance with Section 2.1 for such Showing Month. (b) Seller shall deliver invoices to the address(es) specified in Appendix C; provided, however, that changes to invoice, payment, wire transfer and other banking information must be made in writing and delivered via certified mail and shall include contact information for an authorized person who is available by telephone to verify the authenticity of such requested changes.
Appendix A
Elk Hills Power, LLC
DocuSign DocuSign DocuSign Envelope Envelope Envelope ID: 0060B0B4 49E8E252 24FF9126--138D 932F E2C8--447FC39 4E16---9DA3 A974 A568--49F5ED091B36 A590BEF4BD88 DACD6A887454 4 3.2 Allocation of Other Payments and Costs
(a) Product does not confer to Purchaser any right to dispatch or receive the energy or ancillary services from a Shown Unit. Seller will receive any revenues from, and must pay all costs charged by, CAISO or any other third party with respect to the Unit for (i) start-up, shutdown, and minimum load costs, (ii) capacity for ancillary services, (iii) energy sales, (iv) flexible ramping product, or (v) black start or reactive power services. Purchaser must promptly report receipt of any such revenues to Seller. Purchaser must pay to Seller any such amounts described in this Section 3.2(a) received by Purchaser or a Subsequent Purchaser. Without prejudice to its other rights and remedies, Seller may setoff and recoup any such amounts that are not paid to it against any amounts owed to Purchaser under the WSPP Agreement.
(b) Purchaser is to receive and retain all revenues associated with the Contract Quantity of Product during the Delivery Period, including any capacity and availability revenues from the Capacity Procurement Mechanism, or its successor, RUC Availability Payments, or its successor, but excluding payments described in Section 3.2(a)(i)-(v) or 3.2(d). Seller must promptly report receipt of any such revenues to Purchaser. Seller must pay to Purchaser any such amounts received by Seller, or a Unit’s SC, owner, or operator. Without prejudice to its other rights, Purchaser may set off and recoup any such amounts that are not paid to it against amounts owed to Seller under the WSPP Agreement. (c) If CAISO designates any part of the Contract Quantity as Capacity Procurement Mechanism Capacity, then Seller will, or will cause the Unit’s SC to, within one Business Day of the time Seller receives notification from CAISO, notify Purchaser and not accept any such designation by CAISO unless and until Purchaser has agreed to accept such designation.
(d) Any Availability Incentive Payments or Non-Availability Charges are for Seller to receive and pay.
ARTICLE 4
OTHER PURCHASER AND SELLER COVENANTS
4.1 CAISO Requirements
Seller must schedule or cause the Unit’s SC to schedule or make available to CAISO the Contract Quantity of the Product during the Delivery Period, in compliance with the Tariff, and perform all, or cause the Unit’s SC, owner, or operator to perform all, obligations under applicable law and the Tariff relating to the Product. Nothing herein will prevent Seller from exercising any rights under the Tariff with respect to use of RA Substitute Capacity during the Delivery Period. Purchaser is not liable for, and Seller will indemnify and hold Purchaser harmless from, the failure of Seller or the Unit’s SC, owner, or operator to comply with the Tariff, and for any penalties, fines or costs imposed on Seller or the Unit’s SC, owner, or operator for noncompliance.
4.2 Seller’s and Purchaser’s Duties to Take Actions to Allow Product Utilization Throughout the Delivery Period, Purchaser and Seller will take all commercially reasonable actions and execute all documents or instruments reasonably necessary to ensure Purchaser’s rights to the Contract Quantity of Product for the sole benefit of Purchaser or any Subsequent Purchaser. If necessary, the Parties further agree to negotiate in good faith to amend this Confirmation to conform this Transaction to Appendix A
Elk Hills Power, LLC
DocuSign DocuSign DocuSign Envelope Envelope Envelope ID: 0060B0B4 49E8E252 24FF9126--138D 932F E2C8--447FC39 4E16---9DA3 A974 A568--49F5ED091B36 A590BEF4BD88 DACD6A887454 5 subsequent clarifications, revisions, or decisions rendered by CAISO or an applicable Governmental Body to maintain the benefits of the Transaction.
4.3 Seller’s Representations and Warranties
Seller represents and warrants to Purchaser throughout the Delivery Period that:
(a) no part of the Contract Quantity during the Delivery Period has been committed by Seller to any third party to satisfy Compliance Obligations or analogous obligations in any CAISO or non-CAISO markets;
(b) the Unit qualifies under the Tariff for the Product, and the Unit and Seller are capable of delivering the Product;
(c) the aggregation of all amounts of Capacity Attributes that Seller has sold, assigned, or transferred for the Unit during the Delivery Period does not exceed the Unit NQC and, if applicable, the Unit EFC, for that Unit;
(d) if applicable, Seller has notified either the Unit’s SC or the entity from which Seller purchased the Product that Seller has transferred the Contract Quantity of Product for the Delivery Period to Purchaser; and
(e) Seller has notified or will notify the Unit’s SC that Purchaser is entitled to the revenues set forth in Section 3.2(b), and such SC is obligated to promptly deliver those revenues to Purchaser, along with appropriate documentation supporting the amount of those revenues.
4.4 Collateral Requirements
(a) Notwithstanding anything to the contrary contained in the WSPP Agreement, neither Purchaser nor Seller shall be required to provide Performance Assurance to the other Party during the Delivery Period.
(b) Sections 22.1(d) of the WSPP Agreement shall not apply to either Party with respect to this Transaction.
ARTICLE 5
ADDITIONAL WSPP AGREEMENT AMENDMENTS; GENERAL PROVISIONS
5.1 Termination Payment
For this Transaction, the following is inserted as a penultimate paragraph in Section 22.2(b) of the WSPP Agreement:
“If Purchaser is the Non-Defaulting Party and Purchaser reasonably expects to incur or be liable for any penalties, fines or costs from CAISO, or any Governmental Body, because Purchaser or a Subsequent Purchaser is not able to include the applicable Contract Quantity in a Compliance Showing due to Seller’s Event of Default, then Purchaser may, in good faith, estimate the amount of those penalties, fines or costs and include the estimate in its determination of the Termination Payment, subject to accounting to Seller when those penalties, fines or costs are finally ascertained.
If this accounting establishes that Purchaser’s estimate exceeds the actual amount of penalties, fines or costs, Purchaser must promptly remit to Seller the excess amount with interest in accordance Appendix A
Elk Hills Power, LLC
DocuSign DocuSign DocuSign Envelope Envelope Envelope ID: 0060B0B4 49E8E252 24FF9126--138D 932F E2C8--447FC39 4E16---9DA3 A974 A568--49F5ED091B36 A590BEF4BD88 DACD6A887454 6 with Section 9.3 of the WSPP Agreement. The rights and obligations with respect to determining and paying any Termination Payment, and any dispute resolution provisions with respect thereto, survive the termination of this Transaction and continue until after those penalties, fines or costs are finally ascertained.”
5.2 Confidentiality
Notwithstanding Section 30.1 of the WSPP Agreement, (i) Purchaser may disclose information in order to support its Compliance Showings or otherwise show it has met its Compliance Obligations; (ii) Seller may disclose to a Unit’s SC or as necessary for Supply Plans; (iii) each Party may disclose information to the independent evaluator or other administrator of any competitive solicitation process of Purchaser, which in turn may disclose such information to CAISO or any Governmental Body; and (iv) Purchaser may disclose information to any Subsequent Purchaser. Each Party recognizes that Purchaser is subject to the requirements of the California Public Records Act (Government Code Section 6250 et seq.).
5.3 Joint Powers Authority
Purchaser is organized as a Joint Powers Authority in accordance with the Joint Powers Act of the State of California (California Government Code Sections 6500 et seq.) and is a Governmental Entity separate and distinct from its members. Purchaser shall solely be responsible for all of Purchaser’s debts, obligations and liabilities accruing and arising out of this Agreement, and Seller agrees that it shall have no rights and shall not make any claim, take any actions or assert any remedies against any of Purchaser’s members, or any cities or counties participating in Purchaser’s community choice aggregation program, or any of Purchaser’s retail customers in connection with the Transaction to which this Confirmation applies.
5.4 Dodd-Frank Act
The Parties intend this Transaction to be a “customary commercial arrangement” as described in Section II.A.1 of Commodity Futures Trading Commission, Proposed Guidance, Certain Natural Gas and Electric Power Contracts, 81 Fed. Reg. 20583 at 20586 (Apr. 8, 2016) and a “Forward Capacity Transaction” within the meaning of Commodity Futures Trading Commission, Final Order in Response to a Petition From Certain Independent System Operators and Regional Transmission Organizations To Exempt Specified Transactions Authorized by a Tariff or Protocol Approved by the Federal Energy Regulatory Commission, 78 Fed. Reg. 19,880 (Apr. 2, 2013).
5.5 Additional WSPP Agreement Amendments
For purposes of this Transaction only, the WSPP Agreement shall be amended as follows:
(a) Section 4 of the WSPP Agreement is amended by:
1. Adding “or the Friday after the United States Thanksgiving holiday” before the period at the end of the first sentence under the definition of “Business Day(s)”.
2. Adding the following new definitions:
“Governmental Entity or Public Power System” means a municipality, county, governmental board, public power authority, public utility district, joint action agency, or other similar political subdivision or public entity of the United States, one or more States or territories or any combination thereof.
Appendix A
Elk Hills Power, LLC
DocuSign DocuSign DocuSign Envelope Envelope Envelope ID: 0060B0B4 49E8E252 24FF9126--138D 932F E2C8--447FC39 4E16---9DA3 A974 A568--49F5ED091B36 A590BEF4BD88 DACD6A887454 7 “Special Fund” means a fund or account of the Governmental Entity or Public Power System set aside and or pledged to satisfy the Governmental Entity or Public Power System’s obligations hereunder out of which amounts shall be paid to satisfy all of the Governmental Entity or Public Power System’s obligations under this Agreement for the entire Period of Delivery under each Confirmation hereto.” (b) The first sentence of the second paragraph of Section 10 of the WSPP Agreement is amended by deleting the “or” before “(ii)” and adding to the end of such sentence “or (iii) if the Party claiming inability to perform is a Governmental Entity or Public Power System, any action taken by the Governmental Entity or Public Power System in its governmental capacity.”
(c) Section 13.1 of the WSPP Agreement is amended to change "FERC" to "FERC or the CPUC".
(d) Section 21.2 of the WSPP Agreement is deleted and replaced with the following:
“Any Party due monies under this Agreement, the amounts of which are not in dispute or if disputed have been the subject of a decision awarding monies, (i) shall have the right to seek payment of such monies in court in accordance with Section 34.1 and (ii) shall possess the right to seek relief directly from such court without first exercising termination and liquidation rights under Section 22.
In addition, each Party shall possess the right to seek specific performance (injunctive relief) of the non-delivery related terms of this Agreement and any Confirmation in court in accordance with Section 34.1. In seeking to enforce the terms of this Agreement, however, consistent with Section 21.1, no Party is entitled to receive or recover monetary damages except as provided in Sections 21.3 and 22.”
(e) Section 21.3(d) of the WSPP Agreement is modified by replacing the words “After informal dispute resolution as required by Section 34.1, any remaining dispute involving the calculation of the damages shall be referred to binding dispute resolution as provided by Section 34.2 of this Agreement” with “Unless otherwise resolved informally, any dispute involving the calculation of the damages shall be resolved in accordance with Section 34.1 of this Agreement”.
(f) Section 21 of the WSPP Agreement is modified by adding the following Section 21.4:
“No Immunity Claim. Governmental Entity or Public Power System warrants and covenants that with respect to its contractual obligations hereunder and performance thereof, it will not claim immunity on the grounds of sovereignty or similar grounds with respect to itself or its revenues or assets from (a) suit, (b) jurisdiction of court (provided such jurisdiction is consistent with the venue provisions in Section 34.1), (c) relief by way of injunction, or recovery of property, (d) attachment of assets, or (e) execution or enforcement of any judgment.”
(g) Section 22.3(e)(i) of the WSPP Agreement is modified by replacing the words “Any disputes as to the methodology shall be resolved pursuant to the dispute resolution procedures in Section 34, with binding arbitration pursuant to Section 34.2 required for Appendix A
Elk Hills Power, LLC
DocuSign DocuSign DocuSign Envelope Envelope Envelope ID: 0060B0B4 49E8E252 24FF9126--138D 932F E2C8--447FC39 4E16---9DA3 A974 A568--49F5ED091B36 A590BEF4BD88 DACD6A887454 8 disputes as to the methodology if mediation is unsuccessful” with “Unless otherwise resolved informally, any disputes as to the methodology shall be resolved in accordance with Section 34.1 of this Agreement”.
(h) Section 22.3(f) of the WSPP Agreement is modified by replacing the words “submitted to informal dispute resolution as provided in Section 34.1 of this Agreement and thereafter binding dispute resolution pursuant to Section 34.2 if the informal dispute resolution does not succeed in resolving the dispute” with “resolved in accordance with Section 34.1 of this Agreement”.
(i) Section 24 of the WSPP Agreement is deleted and replaced with the following:
“This WSPP Agreement and any Confirmation 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 or contrary provisions of the WSPP Agreement, if any.”
(j) Subsections 34.1 and 34.2 of the WSPP Agreement are deleted and replaced with the following:
“34.1
(a) Consent to Jurisdiction. ALL JUDICIAL PROCEEDINGS BROUGHT
AGAINST ANY PARTY ARISING OUT OF OR RELATING TO THIS AGREEMENT
SHALL BE BROUGHT IN ANY STATE OR FEDERAL COURT OF COMPETENT
JURISDICTION IN THE STATE OF CALIFORNIA, COUNTY AND CITY OF SAN FRANCISCO OR LOS ANGELES. BY EXECUTING AND DELIVERING THIS
AGREEMENT, EACH PARTY, FOR ITSELF AND IN CONNECTION WITH ITS PROPERTIES, IRREVOCABLY (a) ACCEPTS GENERALLY AND
UNCONDITIONALLY THE EXCLUSIVE JURISDICTION AND VENUE OF SUCH COURTS; (b) WAIVES ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER
HAVE TO THE LAYING OF VENUE OF ANY OF THE AFORESAID ACTIONS OR
PROCEEDINGS ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT
BROUGHT IN THE COURTS REFERRED TO ABOVE AND HEREBY FURTHER
IRREVOCABLY WAIVES AND AGREES NOT TO PLEAD OR CLAIM IN ANY
SUCH COURT THAT ANY SUCH ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. NOTHING
HEREIN SHALL BE INTERPRETED AS WAIVING THE PROVISIONS OR APPLICATION OF THE CALIFORNIA TORT CLAIMS ACT.
34.2 Reserved.”
(k) Subsection 34.3 of the WSPP Agreement is modified by deleting “The Parties shall equally divide the costs of the arbitrator or mediator and the hearing.” (l) Subsection 34.4 of the WSPP Agreement is deleted and replaced with:
“34.4 Reserved.”
(m) Subsections 34.5 and 34.6 are hereby added to Section 34 of the WSPP Agreement:
Appendix A
Elk Hills Power, LLC
DocuSign DocuSign DocuSign Envelope Envelope Envelope ID: 0060B0B4 49E8E252 24FF9126--138D 932F E2C8--447FC39 4E16---9DA3 A974 A568--49F5ED091B36 A590BEF4BD88 DACD6A887454 9 “34.5 Waiver of Jury Trial. EACH PARTY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN
RESPECT OF ANY SUIT, ACTION, CLAIM OR PROCEEDING RELATING TO THIS AGREEMENT.
34.6 LIMITATION OF DAMAGES. THE PARTIES CONFIRM THAT THE EXPRESS
REMEDIES AND MEASURES OF DAMAGES PROVIDED IN THIS AGREEMENT AND ANY CONFIRMATION SATISFY THE ESSENTIAL PURPOSES HEREOF.
FOR BREACH OF ANY PROVISION OF THIS AGREEMENT OR ANY
CONFIRMATION FOR WHICH AN EXPRESS 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 OR IN A CONFIRMATION, THE OBLIGOR’S LIABILITY SHALL BE LIMITED TO
DIRECT ACTUAL DAMAGES ONLY, SUCH DIRECT ACTUAL DAMAGES SHALL
BE THE SOLE AND EXCLUSIVE REMEDY AND ALL OTHER REMEDIES OR DAMAGES AT LAW OR IN EQUITY ARE WAIVED. NOTWITHSTANDING
ANYTHING IN THIS AGREEMENT TO THE CONTRARY, NEITHER PARTY
SHALL BE LIABLE FOR CONSEQUENTIAL, INCIDENTAL, PUNITIVE,
EXEMPLARY OR INDIRECT DAMAGES, LOST PROFITS OR OTHER BUSINESS
INTERRUPTION DAMAGES, BY STATUTE, IN TORT OR CONTRACT, UNDER
ANY INDEMNITY PROVISION SET FORTH IN THIS AGREEMENT OR
OTHERWISE. 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. TO
THE EXTENT ANY DAMAGES REQUIRED TO BE PAID HEREUNDER ARE
LIQUIDATED, THE PARTIES ACKNOWLEDGE THAT THE DAMAGES ARE
DIFFICULT OR IMPOSSIBLE TO DETERMINE, OR OTHERWISE OBTAINING AN
ADEQUATE REMEDY IS INCONVENIENT AND THE DAMAGES CALCULATED
HEREUNDER CONSTITUTE A REASONABLE APPROXIMATION OF THE HARM OR LOSS.”
(n) Section 35 of the WSPP Agreement is modified by inserting the following paragraph between the first and second sentences:
“The Parties agree that each Party’s business consists in whole or in part of entering into forward contracts as or with merchants in capacity or energy, which is presently the subject of dealing in the forward contract trade. The Parties further agree that the transactions entered into pursuant to any Confirmations hereunder (as provided in Article 32 of the WSPP Agreement) are forward contracts involving the sale of capacity and/or energy, which are presently the subject of dealing in the forward contract trade. No Party shall assert before any court or other governmental authority either that another Party is not, or shall not be treated as, a forward contract merchant or that the transaction entered into pursuant, to any Confirmations hereunder (as provided in Article 32 of the WSPP Agreement) are not, or shall not be treated as, forward contracts under the United States Bankruptcy Code.”
Appendix A
Elk Hills Power, LLC
DocuSign DocuSign DocuSign Envelope Envelope Envelope ID: 0060B0B4 49E8E252 24FF9126--138D 932F E2C8--447FC39 4E16---9DA3 A974 A568--49F5ED091B36 A590BEF4BD88 DACD6A887454 10 (o) The following phrase is inserted at the beginning of Section 37 of the WSPP Agreement:
“On the date of entering into this Confirmation and throughout the Delivery Period,” (p) Section 37 of the WSPP Agreement is further modified by adding the following new paragraph at the end:
“Further and with respect to a Party that is a Governmental Entity or Public Power System, such Governmental Entity or Public Power System represents and warrants to the other Party continuing throughout the term of this Confirmation, as follows: (i) all acts necessary to the valid execution, delivery and performance of this Confirmation, including without limitation, competitive bidding, public notice, election, referendum, prior appropriation or other required procedures, has or will be taken and performed as required under the Joint Exercise of Powers Act of California (Government Code Section 6500 et seq.), and the Governmental Entity or Public Power System’s ordinances, bylaws or other regulations, (ii) all persons making up the governing body of Governmental Entity or Public Power System are the duly elected or appointed incumbents in their positions and hold such positions in good standing in accordance with applicable law, (iii) entry into and performance of this Confirmation by Governmental Entity or Public Power System are for a proper public purpose within the meaning of all relevant constitutional, organic or other governing documents and applicable law, (iv) the term of this Confirmation does not extend beyond any applicable limitation imposed by relevant constitutional, organic or other governing documents and applicable law, (v) the Governmental Entity or Public Power System’s obligations to make payments hereunder are unsubordinated obligations and such payments are (a) operating and maintenance costs (or similar designation) which enjoy first priority of payment at all times under any and all bond ordinances or indentures to which it is a party, the Act and all other relevant constitutional, organic or other governing documents and applicable law or (b) otherwise not subject to any prior claim under any and all bond ordinances or indentures to which it is a party, the Act and all other relevant constitutional, organic or other governing documents and applicable law and are available without limitation or deduction to satisfy all Governmental Entity or Public Power System’ obligations hereunder and under each Transaction or (c) are to be made solely from a Special Fund, (vi) entry into and performance of this Agreement and each Confirmation by the Governmental Entity or Public Power System will not adversely affect the exclusion from gross income for federal income tax purposes of interest on any obligation of Governmental Entity or Public Power System otherwise entitled to such exclusion, and (v) obligations to make payments hereunder do not constitute any kind of indebtedness of Governmental Entity or Public Power System or create any kind of lien on, or security interest in, any property or revenues of Governmental Entity or Public Power System which, in either case, is proscribed by any provision of relevant constitutional, organic or other governing documents and applicable law, any order or judgment of any court or other agency of government applicable to it or its assets, or any contractual restriction binding on or affecting it or any of its assets.” (q) Section 41 “Witness” of the WSPP Agreement shall become Section 42 and the following “Mobile Sierra” Section shall be inserted as Section 41:
“The Parties agree as follows:
From the date of entering into a Transaction under this Agreement and throughout the term of such Transaction, the Parties each warrant and covenant as follows:
Appendix A
Elk Hills Power, LLC
DocuSign DocuSign DocuSign Envelope Envelope Envelope ID: 0060B0B4 49E8E252 24FF9126--138D 932F E2C8--447FC39 4E16---9DA3 A974 A568--49F5ED091B36 A590BEF4BD88 DACD6A887454 11 To the fullest extent permitted by Applicable Law, each Party, for itself and its successors and assigns, hereby expressly and irrevocably waives any rights it can or may have, now or in the future, whether under §§ 205 and/or 206 of the Federal Power Act or otherwise, to seek to obtain from FERC by any means, directly or indirectly (through complaint, investigation or otherwise), and each hereby covenants and agrees not at any time to seek to so obtain, an order from FERC changing any section of this Agreement specifying the rate, charge, classification, or other term or condition agreed to by the Parties, it being the express intent of the Parties that, to the fullest extent permitted by Applicable Law, neither Party shall unilaterally seek to obtain from FERC any relief changing the rate, charge, classification, or other term or condition of this Agreement, notwithstanding any subsequent changes in Applicable Law or market conditions that may occur.” (r) Exhibit D of the WSPP Agreement is deleted and replaced with:
“Exhibit D - RESERVED”.
5.6 Counterparts
This Confirmation may be signed in any number of counterparts with the same effect as if the signatures to the counterparts were upon a single instrument. The Parties may rely on electronic or scanned signatures as originals under this Confirmation. Delivery of an executed signature page of this Confirmation as a PDF attachment to an email shall be the same as delivery of a manually executed signature page.
5.7 Entire Agreement; No Oral Agreements or Modifications This Confirmation sets forth the terms of the Transaction into which the Parties have entered and shall constitute the entire agreement between the Parties relating to the contemplated purchase and sale of the Product. Notwithstanding any other provision of the Agreement, this Transaction may be confirmed only through a Documentary Writing executed by both Parties, and no amendment or modification to this Transaction shall be enforceable except through a Documentary Writing executed by both Parties.
AGREED AS OF THE EFFECTIVE DATE:
ELK HILLS POWER, LLC SILICON VALLEY CLEAN ENERGY
AUTHORITY
By: By:
Name:
Title:
Joe Alves
Manager, Power Marketing
Name:
Title:
Monica Padilla on behalf of Girish Balachandran
Chief Operating Officer
Appendix A
Elk Hills Power, LLC
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Elk Hills Power, LLC
DocuSign DocuSign DocuSign Envelope Envelope Envelope ID: 0060B0B4 49E8E252 24FF9126--138D 932F E2C8--447FC39 4E16---9DA3 A974 A568--49F5ED091B36 A590BEF4BD88 DACD6A887454 13 APPENDIX A
DEFINED TERMS
“CAISO” means the California ISO and any successor entity. “Capacity Attributes” means attributes of the Unit that may be counted toward Compliance Obligations, including: flexibility, dispatchability, physical location or point of electrical interconnection of the Unit; Unit ability to generate at a given capacity level, provide ancillary services, or ramp up or down at a given rate; any current or future defined characteristics, certificates, tags, credits, or accounting constructs of the Unit, howsoever entitled, identified from time to time by the CAISO or a Governmental Body having jurisdiction over Compliance Obligations.
“CIRA Tool” means the CAISO Customer Interface for Resource Adequacy. “Compliance Obligations” means, as applicable, RAR, Local RAR and FCR. “Compliance Showings” means the applicable LSE’s compliance with the resource adequacy requirements of the CPUC for an applicable Showing Month.
“CPUC Decisions” means any currently effective or future decisions, resolutions, or rulings related to resource adequacy.
“FCR” means the Flexible Capacity requirements established for LSEs by the CPUC pursuant to the CPUC Decisions, the CAISO pursuant to the Tariff, or other Governmental Body having jurisdiction over Compliance Obligations and includes any non-binding advisory showing which an LSE is required to make with respect to flexible capacity.
“FCR Attributes” means, with respect to a Unit, any and all resource adequacy attributes of the Unit, as may be identified from time to time by the CPUC, CAISO, or other Governmental Body having jurisdiction over Compliance Obligations, that can be counted toward an LSE’s FCR. “Governmental Body” means any federal, state, local, municipal or other government; any governmental, regulatory or administrative agency, commission or other authority lawfully exercising or entitled to exercise any administrative, executive, judicial, legislative, police, regulatory or taxing authority or power; and any court or governmental tribunal.
“Local RAR” means the local resource adequacy requirements established for LSEs by the CPUC pursuant to the CPUC Decisions, by CAISO pursuant to the Tariff, or by any other Governmental Body having jurisdiction over Compliance Obligations.
“LSE” means “Load Serving Entity” as such term is used in Section 40.9 of the Tariff. “MW” means megawatt.
“Notification Deadline” is twenty (20) Business Days before the relevant deadlines for the corresponding Compliance Showings applicable to the relevant Showing Month. “Product” means RAR, Local RAR and FCR that is specified and marked applicable in Appendix B. “Prorated Percentage of Unit Factor” means the percentage, as specified in Appendix B, of the Unit NQC as of the Effective Date that is dedicated to Purchaser under this Transaction.
Appendix A
Elk Hills Power, LLC
DocuSign DocuSign DocuSign Envelope Envelope Envelope ID: 0060B0B4 49E8E252 24FF9126--138D 932F E2C8--447FC39 4E16---9DA3 A974 A568--49F5ED091B36 A590BEF4BD88 DACD6A887454 14 “Prorated Percentage of Unit Flexible Factor” means the percentage, as specified in Appendix B, of the Unit EFC as of the Effective Date that is dedicated to Purchaser under this Transaction. “RAR” means the resource adequacy requirements established for LSEs by the CPUC pursuant to the CPUC Decisions, by CAISO pursuant to the Tariff, or by any other Governmental Body having jurisdiction over Compliance Obligations.
“Replacement Price” means the price at which Purchaser, acting in a commercially reasonable manner, purchases a replacement for any Product specified in this Confirmation but not delivered by Seller, plus costs reasonably incurred by Purchaser in purchasing such substitute Product, or at Purchaser’s option, the market price for such Product not delivered as determined by Purchaser in a commercially reasonable manner; provided, however, in no event shall such price include any penalties, ratcheted demand or similar charges, nor shall Purchaser be required to utilize or change its utilization of its owned or controlled assets or market positions to minimize Purchaser’s liability.
“SC” means Scheduling Coordinator as defined in the Tariff. “Showing Month” means the calendar month of the Delivery Period that is the subject of the related Compliance Showing.
“Shown Unit” means a Unit specified by Seller in a Supply Plan, but not necessarily identified by Seller to Purchaser on the Effective Date.
“Subsequent Purchaser” means the purchaser of Product from Purchaser in a re-sale of Product by Purchaser.
“Tariff” means the CAISO Tariff, including any current CAISO-published “Operating Procedures” and “Business Practice Manuals,” in each case as amended or supplemented from time to time. “Unit” means the generation unit described in Appendix B and any other generating unit that is capable of supply the Contract Quantity of Product during the Delivery Period. “Unit EFC” means Unit Effective Capacity and is the lesser of that of the Unit as set by CAISO as of the Effective Date and that of the Unit on a subsequent date of determination. “Unit NQC” means Unit Net Qualifying Capacity and is the lesser of that of the Unit as set by CAISO as of the Effective Date and that of the Unit on a subsequent date of determination.
Appendix A
Elk Hills Power, LLC
DocuSign DocuSign DocuSign Envelope Envelope Envelope ID: 0060B0B4 49E8E252 24FF9126--138D 932F E2C8--447FC39 4E16---9DA3 A974 A568--49F5ED091B36 A590BEF4BD88 DACD6A887454 15 APPENDIX B
PRODUCT AND UNIT INFORMATION
Product:
Appendix A
Elk Hills Power, LLC
DocuSign DocuSign DocuSign Envelope Envelope Envelope ID: 0060B0B4 49E8E252 24FF9126--138D 932F E2C8--447FC39 4E16---9DA3 A974 A568--49F5ED091B36 A590BEF4BD88 DACD6A887454 16 Unit 1
Unit Specific Information
Resource Name Elk Hills Power
Physical Location 4026 Skyline Road, Tupman, CA
CAISO Resource ID _ ELKHIL_2_PL1X 3
SCID of Resource EMM2
Unit NQC by month (e.g., Jan=50,Feb=65): 380 MWs
Unit EFC by month (e.g., Jan=30, Feb=50) _171 MWs
Resource Type (e.g., gas, hydro, solar, etc.) Natural Gas Fired Minimum Qualified Flexible Capacity Category
(Flex 1, 2 or 3)
N/A
TAC Area (e.g., PG&E, SCE) PG&E
Prorated Percentage of Unit Factor
Prorated Percentage of Unit Flexible Factor
Capacity Area (CAISO System, Fresno, Sierra,
Kern, LA Basin, Bay Area, Stockton, Big
Creek-Ventura, NCNB, San Diego-IV or
Humboldt )
CAISO North System
Resource Category as defined by the CPUC
(DR, 1, 2, 3, 4)
4 (All Hours – planned availability is
unrestricted)
Appendix A Elk Hills Power, LLC
f- l
~
~
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NOTICE INFORMATION
Seller: Elk Hills Power, LLC Purchaser: Silicon Valley Clean Energy Authority Appendix A
Elk Hills Power, LLC
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1 WSPP RESOURCE ADEQUACY CONFIRMATION
This Confirmation confirms the transaction between Marin Clean Energy, a California joint powers authority (“Seller”) and Silicon Valley Clean Energy Authority, a California joint powers authority (“Purchaser”), and each individually a “Party” and together the “Parties”, dated as of May 11, 2022 (the “Effective Date”), by which Seller agrees to sell and deliver, and Purchaser agrees to purchase and receive, the Product (the “Transaction”). This Transaction is governed by the WSPP Agreement dated August 12, 2021 (the “WSPP Agreement”). The WSPP Agreement and this Confirmation, including any applicable appendices, exhibits or amendments thereto, shall be collectively referred to herein as the “Agreement” and will constitute a single agreement between the Parties with respect to the Transaction. Capitalized terms not otherwise defined in this Confirmation or the WSPP Agreement are defined in the Tariff.
ARTICLE 1
TRANSACTION TERMS
Product, Delivery Period, Contract Quantity, Contract Price and other specifics of the Product are in Appendix B. Appendices A, B, C, and D are incorporated into this Confirmation. ☐ Firm RA Product:
Seller shall provide Purchaser with the Product from the Unit in the amount of the Contract Quantity. If the Unit is not available to provide the full amount of the Contract Quantity for any reason, then Seller shall have the option to supply Alternate Capacity pursuant to Section 2.3 to fulfill the remainder of the Contract Quantity during such period. If Seller fails to provide Purchaser with the Contract Quantity and has failed to supply Alternate Capacity to fulfill the remainder of the Contract Quantity during such period, then Seller shall be liable for damages and/or required to indemnify Purchaser for penalties or fines pursuant to the terms of Section 2.5. ☒ Contingent Firm RA Product:
Seller shall provide Purchaser with Product from the Unit in the amount of the Contract Quantity.
If the Unit is not available to provide the full amount of the Contract Quantity as a result of any reduction of the Contract Quantity of the Unit in accordance with Section 2.2, Seller shall have the option to notify Purchaser that either (a) Seller will not provide the portion of the Contract Quantity attributable to such reduction during the period of such non-availability; or (b) Seller will supply Alternate Capacity to fulfill the remainder of the Contract Quantity during such period pursuant to Section 2.3. If the Unit is not available to provide the full amount of the Contract Quantity as a result of any reason other than as provided in Section 2.2, then Seller shall have the option to supply Alternate Capacity pursuant to Section 2.3 to fulfill the remainder of the Contract Quantity during such period. If Seller fails to provide Purchaser with the Expected Contract Quantity from the Unit and has failed to supply Alternate Capacity to fulfill the remainder of the Expected Contract Quantity during such period, then Seller shall be liable for damages and/or required to indemnify Purchaser for penalties or fines pursuant to the terms of Section 2.5.
Appendix A Marin Clean Energy
DocuSign DocuSign DocuSign Envelope Envelope Envelope ID: EDB7E268 C84730FE 2D827348---F5F0 6CC4 BAA3-4D93 --4070 4F6F--8280 -8736 B847--989F4CE8B7A1 869EC2426D7E -175B5671A56A Execution Version
2 ARTICLE 2
DELIVERY OBLIGATIONS AND ADJUSTMENTS
2.1 Sale and Delivery of Product
(a) For each Showing Month of the Delivery Period, Seller shall sell and deliver to Purchaser, and Purchaser shall purchase and receive from Seller, the Expected Contract Quantity of the Product from the Shown Unit(s). Seller’s obligation to deliver the Expected Contract Quantity of Product for the Delivery Period is firm and will not be excused for any reason.
(b) Seller shall deliver the Expected Contract Quantity by submitting to CAISO in its Supply Plan the Shown Unit(s) and the characteristics of the Shown Unit(s) and Product for Purchaser, as further specified in Appendix B, all in compliance with this Confirmation.
(c) Seller shall cause all Supply Plans to meet and be filed in conformance with the requirements of the CPUC and the Tariff. Seller shall submit, or cause the Shown Unit’s SC to submit, on a timely basis with respect to each applicable Showing Month, Supply Plans in accordance with the Tariff and CPUC requirements to identify and confirm the Product delivered to Purchaser for each Showing Month of the Delivery Period. The total amount of Product identified and confirmed for such Showing Month shall equal the Expected Contract Quantity, including a request for Hold-Back Capacity pursuant to Article Five of this Confirmation. (d) Seller shall sell and deliver Product from a Shown Unit that meets the requirements set forth in Appendix B, including the Resource Category and, if applicable, the Flexible Capacity Category. In no event shall a Shown Unit utilize coal or coal materials as a source of fuel. A Shown Unit must be a specific resource that is connected directly to the CAISO controlled grid or be under the operational control of CAISO. A Shown Unit may not be an unspecified import. Seller shall identify the Shown Unit(s) and Expected Contract Quantity by providing Purchaser with the specific information contemplated in Appendix B no later than the Notification Deadline for the relevant Showing Month.
(e) If CAISO rejects either the Supply Plan or the Resource Adequacy Plan with respect to any part of the Expected Contract Quantity for the Shown Unit(s) in any Showing Month, the Parties shall confer, make such corrections as are necessary for acceptance, and resubmit the corrected Supply Plan or Resource Adequacy Plan for validation before the applicable deadline for the Showing Month. (f) The Product is delivered and received when the CIRA Tool shows that the Supply Plan submitted in compliance with Purchaser’s instructions, including Purchaser’s instructions to withhold all or part of the Expected Contract Quantity from Seller’s Supply Plan for any Showing Month during the Delivery Period, has been accepted for the Product from the Shown Unit(s) by CAISO. Seller has failed to deliver the Appendix A
Marin Clean Energy
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3 Product if (i) Purchaser has elected to submit the Product from the Shown Unit in its Resource Adequacy Plan and such submission is accepted by the CPUC and the CAISO but the Supply Plan and Resource Adequacy Plan are not matched in the CIRA Tool and are rejected by CAISO notwithstanding performance of Section
2.1(e) or (ii) Seller fails to submit the volume of Expected Contract Quantity for any Showing Month in such amount as instructed by Purchaser for the applicable Showing Month. Seller will not have failed to deliver the Expected Contract Quantity if Purchaser fails or chooses not to submit the Shown Unit(s) and the Product in its Resource Adequacy Plan with the CPUC or CAISO. (g) Hold-Back Capacity, if any, is deemed Contract Quantity delivered, unless utilized under Article Five as Substitute Capacity, then Contract Quantity is delivered according to the timeline requirements therein.
(h) The Shown Unit(s) must not have characteristics that would trigger the need for Purchaser or Seller to file an advice letter or other request for authorization with the CPUC or for Purchaser to make a compliance filing pursuant to California Public Utilities Code Section 380.1
2.2 Reductions in Contract Quantity
(a) If Seller is providing Contingent Firm RA Product, Seller’s obligation to deliver the Contract Quantity for each Showing Month may be reduced at Seller’s option by the amount of any Planned Outages which exist with respect to any portion of the Unit during the applicable Showing Month; provided, (i) Seller notifies Purchaser by the Notification Deadline applicable to that Showing Month of the amount of Product from the Unit that Purchaser may include in Purchaser’s Compliance Showings applicable to that month as a result of such Planned Outage, and (ii) such reduction is able to be reflected on the Supply Plansin accordance with the Tariff. (b) In the event Seller is unable to provide the Contract Quantity for any portion of a Showing Month because of a Planned Outage of a Unit, Seller has the option, but not the obligation, to provide Product for such portions of such Showing Month from Replacement Units, provided Seller provides and identifiessuch Replacement Unitsin accordance with Section2.3.
2.3 Seller’s Option To Provide Alternate Capacity
If Seller is unable to provide the full Contract Quantity for a Showing Month for any reason, including, without limitation, as provided in Section 2.2, or Seller desires to provide some or all of the Contract Quantity for any Showing Month from a different generating unit other than the Unit, then Seller may, at no cost to Purchaser, provide Purchaser with replacement Product from one or more replacement units having the same Capacity Attributes of the Unit(s) originally identified in Appendix B, including the same Resource Category and, if applicable, the Flexible 1 For example, contracts with Once-Through Cooling resources that terminate one year or less before the State Water Resources Control Board compliance deadline require an advice letter filing under CPUC Decision 12-04-046 Appendix A
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4 Capacity Category (each such unit, a “Replacement Unit”) in an amount such that the total amount of Product provided to Purchaser from the Unit and any Replacement Unit(s) for each Showing Month is not more than the Contract Quantity, provided that in each case:
(a) Seller shall notify Purchaser in writing of its intent to provide Alternate Capacity and shall identify the proposed Replacement Units from which such Alternate Capacity shall be provided no later than the Notification Deadline for Purchaser’s Compliance Showings related to such Showing Month;
(b) The proposed Replacement Units must (i) be accepted by the CAISO, and (ii) otherwise satisfy the requirements of this Agreement;
(c) Sellershall, or shall cause the SC to submit a Supply Plan for each Showing Month and, if applicable, annual filing, no later than the Notification Deadline for Purchaser’s Compliance Showings;
(d) If Seller does not comply with the requirements of Sections 2.3(a), (b) and (c) for the applicable Showing Month and, if applicable, annual filing, then any such Replacement Units shall not be deemed a Replacement Unit for purposes of this Confirmation for that Showing Month and Seller shall not receive payment for such Product; and
(e) The designation of any Replacement Unit(s) by Seller shall be subject to Purchaser’s prior written approval, which shall not be unreasonably withheld.
Once Seller has identified in writing any Replacement Units that meet the requirements of this Section 2.3 and Purchaser has approved such Replacement Units as consistent with this Confirmation, then any such Replacement Units shall be deemed a Unit for purposes of this Confirmation for that Showing Month. Purchaser’s approval of a Replacement Unit as to a given Showing Month shall not be construed as approval of such Replacement Unit for any subsequent Showing Month.
2.4 Planned Outages
As of the Confirmation Effective Date, Seller and Purchaser have agreed to all Planned Outages as specified in Appendix D (“Planned Outage Schedule”) for all relevant Showing Months for the following calendar year, or until the end of the Delivery Period, whichever is shorter. Seller may provide Purchaser with proposed changes to the Planned Outage Schedule from time to time.
Within ten (10) Business Days after Purchaser’s receipt of any Seller proposed changes, Purchaser shall notify Seller in writing of any reasonable requests for modifications to such Seller proposed changes, and Seller shall, to the extent consistent with Prudent Operating Practice, accommodate Purchaser’s requests regarding the timing of any Seller proposed changes to the Planned Outage Schedule.
Appendix A
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5 2.5 Purchaser’s Remedies for Seller’s Failure to Deliver Expected Contract Quantity (a) If Seller fails to deliver any part of the Expected Contract Quantity as required herein for any Showing Month, Seller shall be liable for damages pursuant to Section 21.3 of the WSPP Agreement, without reference to the word “hourly” therein.
(b) Seller shall indemnify, defend and hold harmless Purchaser from any penalties, fines or costs, including Environmental Costs, assessed against Purchaser by the CPUC, CAISO or other Governmental Body resulting from Seller’s failure to deliver the Product or a Shown Unit’s SC’s failure to timely or accurately submit Supply Plans in accordance with the Tariff and this Confirmation. The Parties shall use commercially reasonable efforts to minimize such penalties, fines or costs; provided, that in no event will Purchaser be required to use or change its utilization of its owned or controlled assets or market positions to minimize these penalties, fines or costs. If Seller fails to pay the foregoing penalties, fines or costs, or fails to reimburse Purchaser for those penalties, fines or costs, then, without prejudice to its other rights and remedies, Purchaser may setoff and recoup those penalties, fines or costs against any future amounts it may owe to Seller under this Confirmation or the WSPP Agreement.
2.6 Purchaser’s Re-Sale of Product
(a) Purchaser may re-sell all or part of the Product; provided that any such re-sale must not increase Seller’s obligations hereunder other than as set forth in this Section
2.6(a). For any such a resale, the Resource Adequacy Plan of Purchaser as used herein will refer to the Resource Adequacy Plan of Subsequent Purchaser. Seller shall, or shall cause the Shown Unit’s SC, to follow Purchaser’s instructions with respect to providing such resold Product to Subsequent Purchasers, to the extent such instructions are consistent with Seller’s obligations under this Confirmation.
Seller shall, and shall cause the Shown Unit’s SC, to take all commercially reasonable actions and execute all documents or instruments reasonably necessary to allow such Subsequent Purchasers to use such resold Product in a manner consistent with Purchaser’s rights under this Confirmation. If Purchaser incurs any liability to a Subsequent Purchaser due to the failure of Seller or the Shown Unit’s SC to comply with this Confirmation, Seller will be liable to Purchaser for the amounts Seller would have owed Purchaser under this Confirmation if Purchaser had not resold the Product.
(b) Purchaser shall notify Seller in writing of any resale of Product and the Subsequent Purchaser no later than two (2) Business Days before the Notification Deadline for each Showing Month for which Purchaser has resold the Product. Purchaser shall notify Seller of any subsequent changes or further resales no later than two (2) Business Days before the Notification Deadline for the Showing Month.
Appendix A
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6 (c) If CAISO or CPUC develops a centralized capacity market, Purchaser will have exclusive rights to direct the Seller or the Unit’s SC to offer, bid, or otherwise submit the Expected Contract Quantity of Product for re-sale in such market, Seller and the Unit’s SC shall comply with Purchaser’s direction and Purchaser shall retain and receive all revenues from such re-sale.
(d) Purchaser shall have the exclusive right to direct the Seller or the Unit’s SC to offer, bid, or otherwise submit the Expected Contract Quantity into the CAISO Competitive Solicitation Process (CSP) for CPM Capacity. Seller and the Unit’s SC shall comply with the Purchaser’s direction and, to the extent that the CAISO designates the Expected Contract Quantity as CPM Capacity, Purchaser shall be entitled to retain and receive the CPM Capacity Payment. Unless otherwise instructed by Purchaser, (i) Seller shall not, and shall cause the Unit’s SC to not, offer any portion of the Expected Contract Quantity to CAISO as CPM Capacity and (ii) if CAISO designates any portion of the Contract Capacity as CPM Capacity, then Seller shall, and shall cause the Unit’s SC to, promptly (and in any event within one (1) Business Day of the time Seller receives notification from CAISO) notify Purchaser of such designation, and if CAISO makes such a designation, Seller shall not, and shall cause the Unit’s SC to not, accept any such designation by CAISO unless and until Purchaser has agreed to accept such designation.
ARTICLE 3
PAYMENTS
3.1 Payment
Purchaser shall make a monthly payment to Seller for each Unit by the later of (i) ten (10) Calendar Days after Purchaser’s receipt of Seller’s invoice (which may be given upon first day of the Showing Month) and (ii) the twentieth (20th) of the Showing Month, or if the twentieth (20th) is not a Business Day the next following Business Day (“Monthly RA Capacity Payment”). The Monthly RA Capacity Payment shall equal the product of (a) the applicable Contract Price for that Showing Month, (b) the Expected Contract Quantity for the Showing Month and (c) 1,000, rounded to the nearest penny (i.e., two decimal places); provided, however, that the Monthly RA Capacity Payment shall be adjusted to reflect any portion of Expected Contract Quantity for the Showing Month that was not delivered in accordance with Section 2.1 for such Showing Month.
3.2 Allocation of Other Payments and Costs
(a) Seller will receive any revenues from, and must pay all costs charged by, CAISO or any other third party with respect to the Shown Unit(s) for (i) start-up, shutdown, and minimum load costs, (ii) capacity for ancillary services, (iii) energy sales, (iv) flexible ramping product, or (v) black start or reactive power services. Purchaser must promptly report receipt of any such revenues to Seller. Purchaser must pay to Seller any such amounts described in this Section 3.2(a) received by Purchaser or a Subsequent Purchaser. Without prejudice to its other rights and remedies, Seller Appendix A
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7 may setoff and recoup any such amounts that are not paid to it pursuant to this Section 3.2(a) against any amounts owed to Purchaser under the WSPP Agreement. (b) Purchaser is to receive and retain all revenues associated with the Expected Contract Quantity of Product during the Delivery Period, including any capacity and availability revenues from the Capacity Procurement Mechanism, or its successor, RUC Availability Payments, or its successor, but excluding payments described in Section 3.2(a)(i)-(v) or 3.2(d). Seller shall promptly report receipt of any such revenues to Purchaser. Seller shall pay to Purchaser within thirty (30) days of receipt any such amounts received by Seller, or a Shown Unit’s SC, owner, or operator. Without prejudice to its other rights, Purchaser may set off and recoup any such amounts that are not paid to it against amounts owed to Seller under the WSPP Agreement.
(c) If CAISO designates any part of the Contract Quantity as Capacity Procurement Mechanism Capacity, then Seller shall, or shall cause the Shown Unit’s SC to, within one (1) Business Day of the time Seller receives notification from CAISO, notify Purchaser and not accept any such designation by CAISO unless and until Purchaser has agreed to accept such designation.
(d) Any Availability Incentive Payments or Non-Availability Charges are for Seller to receive and pay.
ARTICLE 4
OTHER PURCHASER AND SELLER COVENANTS
4.1 CAISO Requirements
Seller shall schedule or cause the Shown Unit’s SC to schedule or make available to CAISO the Expected Contract Quantity of the Product during the Delivery Period, in compliance with the Tariff, and perform all, or cause the Shown Unit’s SC, owner, or operator to perform all, obligations under applicable law and the Tariff relating to the Product. Purchaser is not liable for, and Seller shall indemnify and hold Purchaser harmless from, the failure of Seller or the Shown Unit’s SC, owner, or operator to comply with the Tariff, and for any penalties, fines or costs imposed on Seller or the Shown Unit’s SC, owner, or operator for noncompliance.
4.2 Seller’s and Purchaser’s Duties to Take Actions to Allow Product Utilization Throughout the Delivery Period, Purchaser and Seller shall take all commercially reasonable actions and execute all documents or instruments reasonably necessary to ensure (a) Purchaser’s rights to the Expected Contract Quantity for the sole benefit of Purchaser or any Subsequent Purchaser and (b) that Purchaser may use the Expected Contract Quantity to meet its Compliance Obligations. Such commercially reasonable actions shall include, without limitation cooperating with and providing, and causing each Shown Unit’s SC, owner, or operator to cooperate with and provide, requested supporting documentation to the CAISO, the CPUC, or any other Governmental Body responsible for administering the applicable Compliance Obligations, including to Appendix A
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8 demonstrate that the Expected Contract Quantity can be delivered to the CAISO controlled grid for the minimum hours required to satisfy the Compliance Obligations, as applicable, pursuant to the “deliverability” standards established by the CAISO or other Governmental Body of competent jurisdiction.
If necessary, the Parties further agree to negotiate in good faith to amend this Confirmation to conform this Transaction to subsequent clarifications, revisions, or decisions rendered by CAISO or an applicable Governmental Body to maintain the benefits of the Transaction.
4.3 Seller’s Representations and Warranties
Seller represents and warrants to Purchaser throughout the Delivery Period that:
(a) No part of the Contract Quantity during the Delivery Period has been committed by Seller to any third party to satisfy Compliance Obligations or analogous obligations in any CAISO or non-CAISO markets;
(b) The Shown Unit(s) qualify to provide the Product under the Tariff, and the Shown Unit(s) and Seller are capable of delivering the Product; (c) the aggregation of all amounts of Capacity Attributes that Seller has sold, assigned, or transferred for the Shown Unit(s) during the Delivery Period does not exceed the Shown Unit’s Net Qualifying Capacity and, if applicable, the Effective Flexible Capacity for that Shown Unit;
(d) if applicable, Seller has notified either the Shown Unit’s SC or the entity from which Seller purchased the Product that Seller has transferred the Contract Quantity of Product for the Delivery Period to Purchaser; and
(e) Seller has notified or will notify the Shown Unit’s SC that Purchaser is entitled to the revenues set forth in Section 3.2(b), and such Shown Unit’s SC is obligated to promptly deliver those revenues to Purchaser, along with appropriate documentation supporting the amount of those revenues.
4.4 Market Based Rate Authority
Upon Purchaser’s written request, Seller shall, in accordance with FERC Order No. 697, submit a letter of concurrence in support of any affirmative statement by Purchaser that this contractual arrangement does not transfer “ownership or control of generation capacity” from Seller to Purchaser as the term “ownership or control of generation capacity” is used in 18 CFR Section
35.42. Seller shall not, in filings, if any, made subject to Order Nos. 652 and 697, claim that this contractual arrangement conveys ownership or control of generation capacity from Seller to Purchaser.
ARTICLE 5
[RESERVED]
Appendix A
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9 ARTICLE 6
ADDITIONAL WSPP AGREEMENT AMENDMENTS; GENERAL PROVISIONS
6.1 Termination Payment
For this Transaction, the following is inserted as a penultimate paragraph in Section 22.2(b) of the WSPP Agreement:
“If Purchaser is the Non-Defaulting Party and Purchaser reasonably expects to incur or be liable for any penalties, fines or costs from CAISO, or any Governmental Body, because Purchaser or a Subsequent Purchaser is not able to include the applicable Expected Contract Quantity in a Compliance Showing due to Seller’s Event of Default, then Purchaser may, in good faith, estimate the amount of those penalties, fines or costs and include the estimate in its determination of the Termination Payment, subject to accounting to Seller when those penalties, fines or costs are finally ascertained. If this accounting establishes that Purchaser’s estimate exceeds the actual amount of penalties, fines or costs, Purchaser must promptly remit to Seller the excess amount with interest in accordance with Section 9.3 of the WSPP Agreement. The rights and obligations with respect to determining and paying any Termination Payment, and any dispute resolution provisions with respect thereto, survive the termination of this Transaction and continue until after those penalties, fines or costs are finally ascertained.”
6.2 Confidentiality
Notwithstanding Section 30.1 of the WSPP Agreement:
(a) (i) Purchaser may disclose information as necessary in order to support its Compliance Showings or otherwise show it has met its Compliance Obligations; (ii) Seller may disclose as necessary to a Shown Unit’s SC or as necessary for Supply Plans; (iii) each Party may disclose information as necessary to the independent evaluator or other administrator of any competitive solicitation process of Purchaser, which in turn may disclose such information as necessary to CAISO or any Governmental Body; and (iv) Purchaser may disclose information to any Subsequent Purchaser.
(b) Seller acknowledges that Purchaser is a public agency subject to the requirements of the California Public Records Act (Cal. Gov. Code section 6250 et seq.) and that Purchaser may be required to make public this Confirmation (which may be partially redacted by Purchaser) in connection with the process of seeking approval from its board of directors for the execution of this Confirmation. Seller may submit information to Purchaser that Seller considers confidential, proprietary, or trade secret information pursuant the Uniform Trade Secrets Act (Cal. Civ. Code section 3426 et seq.), or otherwise protected from disclosure pursuant to an exemption to the California Public Records Act (Government Code sections 6254 and 6255). Seller acknowledges that Purchaser may submit to Seller information that Purchaser considers confidential or proprietary or protected from disclosure Appendix A
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10 pursuant to exemptions to the California Public Records Act (Government Code sections 6254 and 6255). Upon request or demand of any third person or entity not a party to this Confirmation (“Requestor”) pursuant to the California Public Records Act for production, inspection and/or copying of this Confirmation or any information designated by a disclosing Party as confidential, the receiving Party as soon as practical shall notify the disclosing Party that such request has been made, by telephone call, letter sent via electronic mail, and/or by overnight carrier to the address, or email address listed at the end of this Confirmation. The disclosing Party shall be solely responsible for taking whatever legal steps are necessary to protect information deemed by it to be confidential information and to prevent release of information to the Requestor by the receiving Party. If the disclosing Party takes no such action within ten (10) days, after receiving the foregoing notice from the receiving Party, the receiving Party shall be permitted to comply with the Requestor’s demand and is not required to defend against it. Notwithstanding the foregoing, Purchaser may release confidential information without notice to or over the objection of Seller if Purchaser’s legal counsel advises Purchaser that Purchaser is required by law to release such confidential information.
6.3 Dodd-Frank Act
The Parties intend this Transaction to be a “customary commercial arrangement” as described in Section II.A.1 of Commodity Futures Trading Commission, Proposed Guidance, Certain Natural Gas and Electric Power Contracts, 81 Fed. Reg. 20583 at 20586 (Apr. 8, 2016) and a “Forward Capacity Transaction” within the meaning of Commodity Futures Trading Commission, Final Order in Response to a Petition From Certain Independent System Operators and Regional Transmission Organizations To Exempt Specified Transactions Authorized by a Tariff or Protocol Approved by the Federal Energy Regulatory Commission, 78 Fed. Reg. 19,880 (Apr. 2, 2013).
6.4 Change in Law
If any action by the CPUC, CAISO or any Governmental Body having jurisdiction, or any change in applicable law, occurring after the Confirmation Effective Date results in (i) material changes to Purchaser’s or Seller’s obligations with regard to the Products sold hereunder, (ii) has the effect of changing the transfer and sale procedure set forth in this Confirmation so that the performance of this Confirmation becomes impracticable, or (iii) changes the Resource Adequacy Requirements such that the Product can no longer be counted towards Purchaser’s Resource Adequacy Requirements (a “Change in Law”), the Parties shall work in good faith to revise this Confirmation so that the Parties can perform their obligations regarding the purchase and sale of the Product sold hereunder in order to maintain the original intent.
6.5 Governing Law
Notwithstanding Section 24 of the WSPP Agreement, this Transaction 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.
Appendix A
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11 6.6 Collateral
Notwithstanding any provision in the WSPP Agreement to the contrary, including Section 27, neither Party shall be required to post collateral or other security for this Transaction.
6.7 No Recourse to Members
The Parties are organized as a Joint Powers Authority in accordance with the Joint Exercise of Powers Act of the State of California (Government Code Section 6500, et seq.) and are each a public entity separate from its constituent members. Each Party will solely be responsible for all of such Party’s debts, obligations and liabilities accruing and arising out of this Confirmation. The Parties will have no rights and shall not make any claims, take any actions or assert any remedies against any of the other Party’s constituent members, or the officers, directors, advisors, contractors, consultants or employees of the other Party or the other Party's constituent members, in connection with this Confirmation.
6.8 Other WSPP Agreement Changes
For this Transaction, the WSPP Agreement shall be amended as follows:
(a) Section 9.4 is deleted in its entirety and replaced with the following:
“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, with notice of the objection given to the other Party.
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 two (2) Business Days of such resolution along with interest accrued at the Interest Rate from and including the due date to but excluding the date paid. Inadvertent overpayments shall be returned upon request or deducted by the Party receiving such overpayment from subsequent payments, with interest accrued at the Interest Rate from and including the date of such overpayment to but excluding the date repaid or deducted by the Party receiving such overpayment.
Any dispute with respect to an invoice is waived unless the other Party is notified in writing within twelve (12) months after the invoice is rendered or any specific adjustment to the invoice is made. If an invoice is not rendered within twelve (12) months after the close of the month during which performance of a Transaction occurred, the right to payment for such performance is waived.” (b) Section 22.1 is modified by inserting the following new text at the end thereof:
“(f) the failure of the Defaulting Party to pay its debts generally as they become due or the Defaulting Party’s admission in a writing that is unable to generally pay its debts as they become due;
Appendix A
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12 (g) the institution, by the Defaulting Party, of a general assignment for the benefit of its creditors; or
(h) the application for, consent to, or acquiescence to, by the Defaulting Party, the appointment of a receiver, custodian, trustee, liquidator, or similar official for all or a substantial portion of its assets.”
(c) Section 22.2(b) is amended by inserting “and is continuing” after “Event of Default occurs” in the first line thereof and deleting the second sentence therein. (d) Section 22.3(c) is amended by deleting the third sentence thereof and replacing it with the following: “If the Non-Defaulting Party’s aggregate Gains exceed its aggregate Losses and Costs, if any, resulting from the termination of this Agreement or a Confirmation, the Termination Payment for all such Terminated Transactions shall be zero, notwithstanding any provision in this Section or Agreement to the contrary.”
(e) In Section 22.3(e), delete the entire provision (including subsections) and replace it with the following: “[Intentionally omitted]”
(f) In Section 22.3(f), delete the entire provision and replace it with the following:
“If the Defaulting Party disagrees with the calculation of the Termination Payment and the Parties cannot otherwise resolve their differences, and provided that the Defaulting Party has paid the undisputed part of the Termination Payment to the Non-Defaulting Party as provided under Section 22.3(c), and that any amounts disputed by the Defaulting Party are disputed in good faith, then the Defaulting Party may submit the calculation issue to Dispute Resolution pursuant to Section
34.”
(g) Section 28.1 is applicable and the Parties shall net monthly payments in accordance with Exhibit A of the WSPP. Both Parties intend for the netting provisions of Exhibit A to the WSPP Agreement to be effective on the Confirmation Effective Date.
(h) Section 30.1 is amended by inserting “or requested” after the word “required” in Section 30.1(4) and by adding the following at the end of the first sentence: “; or (8) to the Party’s and such Party’s affiliates’ lenders, counsel, accountants, advisors and agents who have a need to know such information and have agreed to keep such terms confidential”.
(i) Subsections 34.1 and 34.2 are deleted and replaced with the following:
“34.1 INFORMAL DISPUTE RESOLUTION
IN THE EVENT OF ANY DISPUTE ARISING UNDER THIS
TRANSACTION, WITHIN TEN (10) DAYS FOLLOWING THE RECEIPT OF
A WRITTEN NOTICE FROM EITHER PARTY IDENTIFYING SUCH
Appendix A
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13 DISPUTE, THE PARTIES SHALL MEET, NEGOTIATE AND ATTEMPT, IN
GOOD FAITH, TO RESOLVE THE DISPUTE QUICKLY, INFORMALLY AND INEXPENSIVELY. IF THE PARTIES ARE UNABLE TO RESOLVE A
DISPUTE ARISING HEREUNDER WITHIN THIRTY (30) DAYS AFTER
RECEIPT OF SUCH NOTICE, THEN EITHER PARTY MAY SEEK ANY AND
ALL REMEDIES AVAILABLE TO IT AT LAW OR IN EQUITY, SUBJECT TO THE LIMITATIONS SET FORTH IN THIS TRANSACTION.”
“34.2 EXCLUSIVE JURISDICTION
EACH PARTY SUBMITS TO THE EXCLUSIVE JURISDICTION OF
THE STATE OR FEDERAL COURTS LOCATED IN CALIFORNIA, FOR ANY
ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY
TRANSACTION, AND EXPRESSLY WAIVES ANY OBJECTION IT MAY
HAVE TO SUCH JURISDICTION OR THE CONVENIENCE OF SUCH
FORUM.”
(j) The phrase “arbitration or” is deleted from the first line of Section 34.4. (k) The following shall be inserted as a new Section 34.5:
“34.5 LIMITATION OF DAMAGES. EXCEPT AS OTHERWISE SPECIFIED
IN ANY CONFIRMATION, FOR BREACH OF ANY PROVISION OF THIS
CONFIRMATION AGREEMENT FOR WHICH AN EXPRESS REMEDY OR
MEASURE OF DAMAGES IS PROVIDED, THE EXPRESS REMEDY OR
MEASURE OF DAMAGES PROVIDED IS THE SOLE AND EXCLUSIVE
REMEDY UNDER THIS AGREEMENT AND THE AGREEMENT FOR THE
BREACH, LIABILITY FOR THE BREACH IS LIMITED AS SET FORTH IN
THE PROVISION AND ALL OTHER REMEDIES FOR DAMAGES AT LAW OR IN EQUITY ARE WAIVED. EXCEPT AS OTHERWISE SPECIFIED IN
ANY CONFIRMATION, IF NO EXPRESS REMEDY OR MEASURE OF
DAMAGES IS PROVIDED IN THIS AGREEMENT FOR A PARTICULAR
BREACH, LIABILITY FOR THE BREACH IS LIMITED TO DIRECT
DAMAGES ONLY, THE DIRECT DAMAGES ARE THE SOLE AND
EXCLUSIVE REMEDY UNDER THIS AGREEMENT FOR THE BREACH,
AND ALL OTHER REMEDIES FOR DAMAGES AT LAW OR IN EQUITY
ARE WAIVED. EXCEPT AS OTHERWISE SPECIFIED IN ANY
CONFIRMATION, NEITHER PARTY IS LIABLE FOR ANY OTHER TYPE OF
DAMAGE, INCLUDING INCIDENTAL, PUNITIVE, EXEMPLARY,
CONSEQUENTIAL, SPECIAL OR INDIRECT DAMAGES OF ANY NATURE (INCLUDING DAMAGES ASSOCIATED WITH LOST PROFITS, BUSINESS
INTERRUPTION AND LOSS OF GOODWILL) ARISING AT ANY TIME,
WHETHER IN TORT (INCLUDING THE SOLE OR CONTRIBUTORY
NEGLIGENCE OF EITHER PARTY OR ANY RELATED PERSON),
WARRANTY, STRICT LIABILITY, CONTRACT OR STATUTE, UNDER
ANY INDEMNITY PROVISION, OR OTHERWISE.”
Appendix A
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14 (l) Section 37 is amended by inserting the following in the beginning of the section:
“On the date of entering into this Confirmation,”.
(m) Section 41 “Witness” shall become Section 42 and the following “Standard of Review” Section shall be substituted in its place:
“The Parties agree as follows:
From the date of entering into a Transaction under this Agreement and throughout the term of such Transaction, the Parties each warrant and covenant as follows:
(i) Absent the agreement of all Parties to the proposed change, the standard of review for changes to any section of this Agreement (including all Transactions and/or Confirmations) specifying the rate(s) or other material economic terms and conditions agreed to by the Parties herein, whether proposed by a Party, a non-party or FERC acting sua sponte, shall be the “public interest” standard of review set forth in United Gas Pipe Line Co. v. Mobile Gas Service Corp., 350 U.S. 332 (1956) and Federal Power Commission v. Sierra Pacific Power Co., 350 U.S. 348 (1956)( the “Mobile-Sierra” doctrine) and clarified in Morgan Stanley Capital Group, Inc. v.
Public Util. Dist. No. 1 of Snohomish 554 U.S. 527 (2008) and NRG Power Marketing LLC v. Maine Pub. Util. Comm’n, 558 U.S. 165 (2010). (ii) The Parties, for themselves and their successors and assigns, (i) agree that this “public interest” standard shall apply to any proposed changes in any other documents, instruments or other agreements executed or entered into by the Parties in connection with this Agreement and (ii) hereby expressly and irrevocably waive any rights they can or may have to the application of any other standard of review, including the “just and reasonable” standard.”
6.9 Counterparts
This Confirmation may be signed in any number of counterparts with the same effect as if the signatures to the counterparts were upon a single instrument. The Parties may rely on electronic, or scanned signatures as originals under this Confirmation. Delivery of an executed signature page of this Confirmation by electronic mail transmission (including PDF) shall be the same as delivery of a manually executed signature page.
6.10 Entire Agreement; No Oral Agreements or Modifications This Confirmation sets forth the terms of the Transaction into which the Parties have entered and shall constitute the entire agreement between the Parties relating to the contemplated purchase and sale of the Product. Notwithstanding any other provision of the Agreement, this Transaction may be confirmed only through a Documentary Writing executed by both Parties, and no amendment or modification to this Transaction shall be enforceable except through a Documentary Writing executed by both Parties.
Appendix A
Marin Clean Energy
DocuSign DocuSign DocuSign Envelope Envelope Envelope ID: EDB7E268 C84730FE 2D827348---F5F0 6CC4 BAA3-4D93 --4070 4F6F--8280 -8736 B847--989F4CE8B7A1 869EC2426D7E -175B5671A56A Execution Version
15 [Signatures appear on the following page.]
Appendix A
Marin Clean Energy
DocuSign DocuSign DocuSign Envelope Envelope Envelope ID: EDB7E268 C84730FE 2D827348---F5F0 6CC4 BAA3-4D93 --4070 4F6F--8280 -8736 B847--989F4CE8B7A1 869EC2426D7E -175B5671A56A 16 AGREED AS OF THE EFFECTIVE DATE:
MARIN CLEAN ENERGY, a California
joint powers authority
SILICON VALLEY CLEAN ENERGY
AUTHORITY, a California joint powers
authority
By: By:
Name:
Title:
Dawn Weisz
CEO
Name:
Title:
Monica Padilla on behalf of Girish Balachandran
Chief Operating Officer
Appendix A Marin Clean Energy
[£'"""'"""'" 0 IW/IA, UJus~ A59878416EBC4F8
DocuSign DocuSign DocuSign Envelope Envelope Envelope ID: EDB7E268 C84730FE 2D827348---F5F0 6CC4 BAA3-4D93 --4070 4F6F--8280 -8736 B847--989F4CE8B7A1 869EC2426D7E -175B5671A56A Appendix A - 1
APPENDIX A
DEFINED TERMS
“Alternate Capacity” means replacement Product which Seller has elected to provide to Purchaser in accordance with the terms of Section 2.3.
“CAISO” means the California ISO or the successor organization to the functions thereof. “Capacity Attributes” means attributes of the Shown Unit that may be counted toward Compliance Obligations, including: flexibility, dispatchability, physical location or point of electrical interconnection of the Shown Unit; Unit ability to generate at a given capacity level, provide ancillary services, or ramp up or down at a given rate; any current or future defined characteristics, certificates, tags, credits, or accounting constructs of the Shown Unit, howsoever entitled, identified from time to time by the CAISO or a Governmental Body having jurisdiction over Compliance Obligations.
“CIRA Tool” means the CAISO Customer Interface for Resource Adequacy. “Compliance Obligations” means, as applicable, RAR, Local RAR and FCR. “Compliance Showings” means the applicable LSE’s compliance with the resource adequacy requirements of the CPUC for an applicable Showing Month. “Contingent Firm RA Product” has the meaning set forth in Article 1 herein. “CPUC Decisions” means any currently effective or future decisions, resolutions, or rulings related to resource adequacy.
“CPUC Filing Guide” is the document issued annually by the CPUC which sets forth the guidelines, requirements and instructions for load serving entities to demonstrate compliance with the CPUC’s resource adequacy program.
“Effective Flexible Capacity” has the meaning given in CAISO’s FERC-approved Tariff. “Environmental Costs” means (i) costs incurred in connection with acquiring and maintaining all environmental permits and licenses for the Product, (ii) the Product’s compliance with all applicable environmental laws, rules, and regulations, including capital costs for pollution mitigation or installation of emissions control equipment required to permit or license the Product, (iii) all operating and maintenance costs for operation of pollution mitigation or control equipment, (iv) costs of permit maintenance fees and emission fees as applicable, (v) the costs of all emission reductions that have been authorized by a local air pollution control district or emissions trading credits or units pursuant to the California Health & Safety Code, market based incentive programs such as the South Coast Air Quality Management District’s Regional Clean Air Incentives Market, authorizations to emit sulfur dioxide and oxides of nitrogen by the Environmental Protection Agency, and any costs related to greenhouse gas emissions required by any applicable Appendix A
Marin Clean Energy
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environmental laws, rules, regulations, or permits to operate, and (vi) costs associated with the disposal, clean-up, decontamination or remediation, on or off site, of hazardous substances. “Expected Contract Quantity” means,with respect to any Showing Month of the Delivery Period, (a) for Firm RA Product, the Contract Quantity of Product, including the amount of Contract Quantity of Product that Seller has elected to provide Alternate Capacity, and (b) for Contingent Firm RA Product, the Contract Quantity of Product for such Showing Month, including the amount of Contract Quantity of Product that Seller has elected to provide Alternate Capacity, less any reductions to Contract Quantity consistent with Section 2.2 with respect to which Seller has not elected to provide Alternate Capacity.
“FCR” means the flexible capacity requirements established for LSEs by the CPUC pursuant to the CPUC Decisions, the CAISO pursuant to the Tariff, or other Governmental Body having jurisdiction over Compliance Obligations and includes any non-binding advisory showing which an LSE is required to make with respect to flexible capacity. “FCR Attributes” means, with respect to a Shown Unit, any and all resource adequacy attributes of the Shown Unit, as may be identified from time to time by the CPUC, CAISO, or other Governmental Body having jurisdiction over Compliance Obligations, that can be counted toward an LSE’s FCR.
“Firm RA Product” has the meaning set forth in Article 1 herein. “Flexible Capacity Category” shall be as described in the annual CPUC Filing Guide, as such may be modified, amended, supplemented or updated from time to time. “Governmental Body” means any federal, state, local, municipal or other government; any governmental, regulatory or administrative agency, commission or other authority lawfully exercising or entitled to exercise any administrative, executive, judicial, legislative, police, regulatory or taxing authority or power; and any court or governmental tribunal. “Interest Rate” means, for any date, the lesser of (a) the per annum rate of interest equal to the prime lending rate as may from time to time be published in The Wall Street Journal under “Money Rates” on such day (or if not published on such day on the most recent preceding day on which published), plus two percent (2%) and (b) the maximum rate permitted by applicable law. “Local RAR” means the local resource adequacy requirements established for LSEs by the CPUC pursuant to the CPUC Decisions, by CAISO pursuant to the Tariff, or by any other Governmental Body having jurisdiction over Compliance Obligations.
“Local RAR Attributes” means, with respect to a Shown Unit, any and all resource adequacy attributes of the Shown Unit, as may be identified from time to time by the CPUC, CAISO, or other Governmental Body having jurisdiction over Compliance Obligations, that can be counted toward an LSE’s Local RAR.
“LSE” means “Load Serving Entity” as such term is used in Section 40.9 of the Tariff.
Appendix A
Marin Clean Energy
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“MW” means megawatt.
“Net Qualifying Capacity” has the meaning given in CAISO’s FERC-approved Tariff. “Notification Deadline” is ten (10) Business Days before the relevant deadlines for the corresponding Compliance Showings applicable to the relevant Showing Month. “Planned Outage” means, subject to and as further described in the CPUC Decisions, a CAISO-approved, planned or scheduled disconnection, separation or reduction in capacity of the Unit that is conducted for the purposes of carrying out routine repair or maintenance of such Unit, or for the purposes of new construction work for such Unit. “Product” means RAR Attributes, Local RAR Attributes and FCR Attributes, each for the Delivery Period, Unit, Contract Quantity, Contract Price and other specifications contained in Appendix B. “Prorated Percentage of Unit Factor” means the percentage, as specified in Appendix B, of the Unit NQC as of the Effective Date that is dedicated to Purchaser under this Transaction. “Prorated Percentage of Unit Flexible Factor” means the percentage, as specified in Appendix B, of the Unit EFC as of the Effective Date that is dedicated to Purchaser under this Transaction. “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 power industry during the relevant time period in the Western United States, or (b) any of the practices, methods and acts which, in the exercise of reasonable judgment in light of the facts known at the time the decision was made, could have been expected to accomplish the desired result at a reasonable cost consistent with good business practices, reliability, safety and expedition. Prudent Operating Practice is not intended to be limited to the optimum practice, method or act to the exclusion of all others, but rather to acceptable practices, methods or acts generally accepted in the electric power industry in the Western United States. “RAR Attributes” means, with respect to a Shown Unit, any and all resource adequacy attributes of the Shown Unit, as may be identified from time to time by the CPUC, CAISO, or other Governmental Body having jurisdiction over Compliance Obligations, that can be counted toward an LSE’s RAR.
“Replacement Unit” hasthemeaning setforth in Section 2.3. “Resource Adequacy Requirements” or “RAR” means the resource adequacy requirements established for LSEs by the CPUC pursuant to the CPUC Decisions, by CAISO pursuant to the Tariff, or by any other Governmental Body having jurisdiction over Compliance Obligations, not including Local RAR or FCR.
“Resource Category” shall be as described in the annual CPUC Filing Guide, as such may be modified, amended, supplemented or updated from time to time.
Appendix A
Marin Clean Energy
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“SC” means Scheduling Coordinator as defined in the Tariff. “Showing Month” meansthe calendar month of the Delivery Period that isthe subject of the related Compliance Showing.
“Shown Unit” means the Unit, or any Replacement Unit meeting the requirements of Section 2.3 of this Confirmation and specified by Seller in a Supply Plan. “Subsequent Purchaser” means the purchaser of Product from Purchaser in a re-sale of Product by Purchaser.
“Substitute Capacity” has the meaning set forth in the Tariff for “RA Substitute Capacity”. “Tariff” means the CAISO Tariff, including any current CAISO-published “Operating Procedures” and “Business Practice Manuals,” in each case as amended or supplemented from time to time.
“Unit” means the generation unit described in Appendix B. A Unit or Shown Unit may not be a coal-fired generating facility.
“Unit EFC” means the lesser of the Unit’s Effective Flexible Capacity as set by CAISO as of the Effective Date and that of the Unit on a subsequent date of determination. “Unit NQC” means the lesser of the Unit’s Net Qualifying Capacity as set by CAISO as of the Effective Date and that of the Unit on a subsequent date of determination.
Appendix A
Marin Clean Energy
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APPENDIX B
PRODUCT AND UNIT INFORMATION
Product:
Appendix A
Marin Clean Energy
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Unit 1
Unit Specific Information
Resource Name Sunrise Power Project
Physical Location Fellows, CA
CAISO Resource ID SUNRIS_2_PL1X3
SCID of Resource ALSR
Unit NQC by month (e.g., Jan=50,Feb=65): 586.02
Unit EFC by month (e.g., Jan=30, Feb=50) N/A
Resource Type (e.g., gas, hydro, solar, etc.) Natural Gas Minimum Qualified Flexible Capacity
Category (Flex 1, 2 or 3) N/A
TAC Area (e.g., PG&E, SCE) PG&E
Prorated Percentage of Unit Factor N/A
Prorated Percentage of Unit Flexible Factor N/A
Capacity Area (CAISO System, Fresno,
Sierra, Kern, LA Basin, Bay Area,
Stockton, Big Creek-Ventura, NCNB, San
Diego-IV or Humboldt)
CAISO System
Resource Category as defined by the CPUC
(DR, 1, 2, 3, 4) 4
Appendix A
Marin Clean Energy
DocuSign DocuSign DocuSign Envelope Envelope Envelope ID: EDB7E268 C84730FE 2D827348---F5F0 6CC4 BAA3-4D93 --4070 4F6F--8280 -8736 B847--989F4CE8B7A1 869EC2426D7E -175B5671A56A Appendix C - 1
APPENDIX C
NOTICE INFORMATION
Seller: Marin Clean Energy Purchaser: Silicon Valley Clean Energy Authority
Appendix A
Marin Clean Energy
DocuSign DocuSign DocuSign Envelope Envelope Envelope ID: EDB7E268 C84730FE 2D827348---F5F0 6CC4 BAA3-4D93 --4070 4F6F--8280 -8736 B847--989F4CE8B7A1 869EC2426D7E -175B5671A56A Appendix D - 1
APPENDIX D
PLANNED OUTAGE SCHEDULE
Unit Name CAISO
Resource ID *
Outage (MW)
SLIC
Outage
Start Date
SLIC
Outage
End Date
N/A N/A N/A N/A N/A
Appendix A
Marin Clean Energy