Attn: Monica Padilla, Director of Power
Resources
Phone: (408) 721-5301 xl009
Email: [email protected]
Payments:
Attn: Business Management
Phone:
E-mail: [email protected] Payments:
Attn: Finance Group
Phone: (408) 721-5301
Email: [email protected]
Wire Transfer: [Seller shall provide to Buyer
the information below at least 60 days prior
to the Commercial Operation Date.]
BNK:
ABA:
ACCT:
Wire Transfer:
BNK:
ABA:
ACCT:^^^^^
Exhibit N - 2
Item 3
Attachment 2
Yellow Pine Solar III, LLC
Yellow Pine Solar III, LLC
(“Seller”)
Silicon Valley Clean Energy Authority
(“Buyer”)
Defaults:
Yellow Pine Solar III, LLC
700 Universe Blvd.
Juno Beach, FL 33408
[email protected]
With a simultaneous copy provided to:
Attn: General Counsel
E-mail: [email protected]
and
With additional Notices of an Event of
Default to:
Hall Energy Law PC
Attn: Stephen Hall
Phone: (503) 313-0755
Email: [email protected]
Emergency Contact:
Street: 700 Universe Blvd.
City: Juno Beach, FL 33408
Attn: Business Management
Phone:
Email: [email protected]
and
[email protected]
Emergency Contact:
Attn: Monica Padilla, Director of Power
Resources
Phone: (408) 721-5301 xl009
Email: [email protected]
Exhibit N - 3
Exhibit O - 1
EXHIBIT O
CAPACITY AND EFFICIENCY RATE TESTS
Storage Capacity Test Notice and Frequency
A. Commercial Operation Storage Capacity Test(s). Upon no less than ten (10) Business Days prior Notice to Buyer, Seller shall schedule and complete a Commercial Operation Storage Capacity Test prior to the Commercial Operation Date. Such initial Commercial Operation Storage Capacity Test (and any subsequent Commercial Operation Storage Capacity Test permitted in accordance with Section 5 of Exhibit B) shall be performed in accordance with this Exhibit O and shall establish the Installed Capacity and initial Efficiency Rate hereunder based on the actual capacity and capabilities of the Facility determined by such Commercial Operation Storage Capacity Test(s).
B. Subsequent Storage Capacity Tests. Following the Commercial Operation Date, at least fifteen (15) days in advance of the start of each Contract Year, upon no less than ten (10) Business Days prior Notice to Buyer, Seller shall schedule and complete a Storage Capacity Test.
In addition to the annual capacity test, if Buyer has reason to believe that the Effective Capacity or the Efficiency Rate is materially less than shown by the most recent test results, Buyer shall have the right to require a Storage Capacity Test at any time upon no less than five (5) Business Days prior Notice to Seller. Seller shall have the right to run a retest of any Storage Capacity Test at any time upon five (5) Business Days’ prior Notice to Buyer (or any shorter period reasonably acceptable to Buyer consistent with Prudent Operating Practice).
C. Test Results and Re-Setting of Effective Capacity and Efficiency Rate. No later than five (5) days following any Storage Capacity Test, Seller shall submit a testing report detailing results and findings of the test. The report shall include Facility Meter readings and plant log sheets verifying the operating conditions and output of the Facility. In accordance with Section 4.4(a)(ii) of the Agreement and Part II(I) below, for each Storage Capacity Test after the Commercial Operation Storage Capacity Test(s), the Effective Capacity (up to, but not in excess of, the Installed Capacity) and Efficiency Rate determined pursuant to such Storage Capacity Test shall become the new Effective Capacity and Efficiency Rate at the beginning of the day following the completion of the test for calculating the Monthly Capacity Payment and all other purposes under this Agreement.
Storage Capacity Test Procedures
PART I. GENERAL.
A. Each Storage Capacity Test shall be conducted in accordance with Prudent Operating Practices, the Operating Restrictions, and the provisions of this Exhibit O. For ease of reference, a Storage Capacity Test is sometimes referred to in this Exhibit O as a “SCT”. Buyer or its representative may be present for the SCT and may, for informational purposes only, use its own metering equipment (at Buyer’s sole cost).
B. Conditions Prior to Testing.
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Yellow Pine Solar III, LLC
Exhibit O - 2
(1) EMS Functionality. The EMS shall be successfully configured to receive data from the Battery Management System (BMS), exchange DNP3 data with the Buyer SCADA device, and transfer data to the database server for the calculation, recording and archiving of data points. (2) Communications. The Remote Terminal Unit (RTU) testing should be successfully completed prior to any testing. The interface between Buyer’s RTU and the Facility SCADA System should be fully tested and functional prior to starting any testing, including verification of the data transmission pathway between Buyer’s RTU and Seller’s EMS interface and the ability to record SCADA System data.
(3) Commissioning Checklist. Commissioning shall be successfully completed per manufacturer guidance on all applicable installed Facility equipment, including verification that all controls, set points, and instruments of the EMS are configured.
PART II. REQUIREMENTS APPLICABLE TO ALL STORAGE CAPACITY TESTS.
Note: Seller shall have the right and option in its sole discretion to install storage capacity in excess of the Guaranteed Capacity; provided, for all purposes of this Agreement, the amount of Installed Capacity shall never be deemed to exceed the Guaranteed Capacity, and all SOC measurements associated with a Storage Capacity Test shall be based on the Effective Capacity without taking into account any capacity that exceeds the Installed Capacity.
A. Test Elements. Each SCT shall include at least the following individual test elements, which must be conducted in the order prescribed in Part III of this Exhibit O, unless the Parties mutually agree to deviations therefrom. The Parties acknowledge and agree that should Seller fall short of demonstrating one or more of the Test Elements as specified below, the Test will still be deemed “complete,” and any adjustments necessary to the Effective Capacity or to the Efficiency Rate resulting from such Test, if applicable, will be made in accordance with this Exhibit O.
(1) Electrical output at maximum discharging level at the Facility Meter (MW) for four (4) continuous hours; and
(2) Electrical input at maximum charging level at the Facility Meter (MW), as sustained until the SOC reaches at least 90%, continued by the electrical input at a rate up to the maximum charging level at the Facility Meter (MW), as sustained until the SOC reaches 100%, not to exceed five (5) hours of total charging time.
B. Parameters. During each SCT, the following parameters shall be measured and recorded simultaneously for the Facility, at two (2) second intervals:
(1) Time;
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Attachment 2
Yellow Pine Solar III, LLC
Exhibit O - 3
(2) The amount of Discharging Energy to the Facility Meters (kWh) (i.e., to each measurement device making up the Facility Meter);
(3) Net electrical energy input from the Facility Meters (kWh) (i.e., from each measurement device making up the Facility Meter); and
(4) Storage Level (MWh).
C. Site Conditions. During each SCT, the following conditions at the Site shall be measured and recorded simultaneously at thirty (30) minute intervals:
(1) Relative humidity (%);
(2) Barometric pressure (inches Hg); and
(3) Ambient air temperature (°F).
D. Test Showing. Each SCT shall record and report the following datapoints:
(1) That the SCT successfully started;
(2) The maximum sustained discharging level for four (4) consecutive hours pursuant to A(1) above;
(3) The maximum sustained charging level for five (5) consecutive hours (or such lesser time as is required to reach 100% SOC) pursuant to A(2) above; (4) Amount of time between the Facility’s electrical output going from 0 to the maximum sustained discharging level registered during the SCT for purposes of calculating the ramp rate (with the parties acknowledging that this value may be effectively instantaneous and unmeasurable with precision);
(5) Amount of time between the Facility’s electrical input going from 0 to the maximum sustained charging level registered during the SCT (for purposes of calculating the ramp rate);
(6) Amount of Charging Energy, registered at the Facility Meter, to go from 0% SOC to 100% SOC;
(7) Amount of Discharging Energy, registered at the Facility Meter, to go from 100% SOC to 0% SOC.
E. Test Conditions.
(1) General. At all times during a SCT, the Facility shall be operated in compliance with Prudent Operating Practices, the Operating Restrictions, and all operating protocols recommended, required or established by the manufacturer for the Facility.
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Attachment 2
Yellow Pine Solar III, LLC
Exhibit O - 4
(2) Abnormal Conditions. If abnormal operating conditions that prevent the testing or recordation of any required parameter occur during a SCT, Seller may postpone or reschedule all or part of such SCT in accordance with Part II.F below.
(3) Instrumentation and Metering. Seller shall provide all instrumentation, metering and data collection equipment required to perform the SCT. The instrumentation, metering and data collection equipment electrical meters shall be calibrated in accordance with Prudent Operating Practice and, as applicable, the CAISO Tariff.
F. Incomplete Test. If any SCT is not completed in accordance herewith, Buyer may in its sole discretion: (i) accept the results up to the time the SCT stopped without any modification to the Effective Capacity or Efficiency Rate pursuant to Section I below; (ii) require that the portion of the SCT not completed, be completed within a reasonable specified time period; or (iii) require that the SCT be entirely repeated within a reasonable specified time period. Notwithstanding the above, if Seller is unable to complete a SCT due to a Force Majeure Event or the actions or inactions of Buyer or the CAISO or the Transmission Provider, Seller shall be permitted to reconduct such SCT on dates and at times reasonably acceptable to the Parties.
G. Test Report. Within five (5) Business Days after the completion of any SCT, Seller shall prepare and submit to Buyer a written report of the results of the SCT, which report shall include:
(1) A record of the personnel present during the SCT that served in an operating, testing, monitoring or other such participatory role; (2) The measured and calculated data for each parameter set forth in Part II.A through D, including copies of the raw data taken during the test; and (3) Seller’s statement of either Seller’s acceptance of the SCT or Seller’s rejection of the SCT results and reason(s) therefor.
Within ten (10) Business Days after receipt of such report, Buyer shall notify Seller in writing of either Buyer’s acceptance of the SCT results or Buyer’s rejection of the SCT and reason(s) therefor. If either Party rejects the results of any SCT, such SCT shall be repeated in accordance with Part II.F.
H. Supplementary Storage Capacity Test Protocol. No later than sixty (60) days prior to, the initial Commercial Operation Storage Capacity Test Seller shall deliver to Buyer for its review and approval (such approval not to be unreasonably delayed or withheld) a supplement to this Exhibit O with additional and supplementary details, procedures and requirements applicable to Storage Capacity Tests based on the then current design of the Facility (“Supplementary Storage Capacity Test Protocol”). Thereafter, from time to time, Seller may deliver to Buyer for its review and approval (such approval not to be unreasonably delayed or withheld) any Seller recommended updates to the then-current Supplementary Storage Capacity Test Item 3
Attachment 2
Yellow Pine Solar III, LLC
Exhibit O - 5
Protocol. The initial Supplementary Storage Capacity Test Protocol (and each update thereto), once approved by Buyer, shall be deemed an amendment to this Exhibit O.
I. Adjustment to Effective Capacity and Efficiency Rate. The Effective Capacity and Efficiency Rate shall be updated as follows:
(1) The total amount of Discharging Energy delivered to the Delivery Point (expressed in MWh AC) during the time period comprised of (x) the first four (4) hours of discharge, plus (y) the time required for ramping the Facility from 0 MWAC to the maximum discharging level as limited by CAISO (up to, but not in excess of, the product of (i) (a) the Guaranteed Capacity (in the case of a Commercial Operation Storage Capacity Test, including under Section 5 of Exhibit B) or (b) the Installed Capacity (in the case of any other Storage Capacity Test), multiplied by (ii) four (4) hours) shall be divided by four (4) hours to determine the Effective Capacity, which shall be expressed in MWAC, and shall be the new Effective Capacity in accordance with Section 4.4(a)(ii) of the Agreement. (2) The total amount of Discharging Energy (as reported under Section II.D(7) above) divided by the total amount of Charging Energy (as reported under Section II.D(6) above), and expressed as a percentage, shall be recorded as the new Efficiency Rate, and shall be used for the calculation of the Efficiency Rate Liquidated Damages in Exhibit C until updated pursuant to a subsequent Storage Capacity Test.
PART III. INITIAL SUPPLEMENTARY CAPACITY TEST PROTOCOL.
A. Effective Capacity and Efficiency Rate Test
• Procedure:
(1) System Starting State: The Facility shall be balanced using original equipment manufacturer procedures as appropriate and will be in the on-line state at 0% SOC. (2) Record the initial value of the SOC.
(3) Command a real power charge that results in an AC power of Facility’s maximum charging level and continue charging until the earlier of (a) the Facility has reached 100% SOC or (b) five (5) hours have elapsed since the Facility commenced charging.
(4) Record and store the SOC after the earlier of (a) the Facility has reached 100% SOC or (b) five (5) hours of continuous charging.
(5) Record and store the amount of Charging Energy, registered at the Facility Meter, to go from 0% SOC to 100% SOC.
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Attachment 2
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Exhibit O - 6
(6) Following one (1) hour rest period, command a real power discharge that results in an AC power output of the Facility’s maximum discharging level and maintain the discharging state until the earlier of (a) the Facility has discharged at the maximum discharging level for four (4) consecutive hours, or (b) the Facility has reached 0% SOC.
(7) Record and store the SOC after four (4) hours of continuous discharging.
Such data point shall be used for purposes of calculation of the Effective Capacity. If the Facility SOC remains above zero percent (0%) after discharging at a rate at or above the Guaranteed Capacity (or at or above the Installed Capacity after a Commercial Operation Storage Capacity Test) for four (4) consecutive hours pursuant to Part III.A.6(a), the SOC will be deemed 0 for the purposes of calculating the Effective Capacity. (8) Record and store the Discharging Energy as measured at the Facility Meter.
Such data point shall be used for purposes of calculation of the Effective Capacity.
(9) If the Facility has not reached 0% SOC pursuant to Section III.A.6, continue discharging the Facility until it reaches a 0% SOC.
(10) Record and store the Discharging Energy as measured at the Facility Meter from the commencement of discharging pursuant to Part III.A.6 until the Facility has reached a 0% SOC pursuant to either Part III.A.7 or Part III.A.9, as applicable.
• Test Results:
(1) The resulting Effective Capacity measurement is the sum of the total Discharging Energy as recorded pursuant to Part III.A.8 at the Facility Meter divided by four (4) hours.
(2) The quotient of (x) the total amount of Discharging Energy (as reported under Section III.A(10) above), divided by (y) the total amount of Charging Energy (as reported under Section III.A(5) above), and expressed as a percentage, shall be recorded as the new Efficiency Rate, and shall be used for the calculation of the Efficiency Rate Liquidated Damages in Exhibit C until updated pursuant to a subsequent Storage Capacity Test.
B. AGC Discharge Test
• Purpose: This test will demonstrate the AGC discharge capability to achieve the Facility’s maximum discharging level within 30 seconds. • System starting state: The Facility will be in the on-line state at and at an initial active power level of 0 MW and reactive power level of 0 MVAR. The EMS will be configured to follow a predefined agreed-upon active power profile.
Item 3
Attachment 2
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Exhibit O - 7
• Procedure:
(1) Record the Facility active power level at the Facility Meter. (2) Command the Facility to follow a simulated CAISO RIG signal of PMAX at .95 power factor for ten (10) minutes.
(3) Record and store the Facility active power response (in seconds). • System end state: The Facility will be in the on-line state and at a commanded active power level of 0 MW.
C. AGC Charge Test
• Purpose: This test will demonstrate the AGC charge capability to achieve the facility’s full charging level within .
• System starting state: The Facility will be in the on-line state at and at an initial active power level of 0 MW and reactive power level of 0 MVAR. The Facility control system will be configured to follow a predefined agreed-upon active power profile.
• Procedure:
(1) Record the Facility active power level at the Facility Meter. (2) Command the Facility to follow a simulated CAISO RIG signal of PMAX at power factor for
(3) Record and store the Facility active power response (in seconds). • System end state: The Facility will be in the on-line state and at a commanded active power level of 0 MW.
D. Reactive Power Production Test
• Purpose: This test will demonstrate the reactive power production capability of the Facility.
• System starting state: The Facility will be in the on-line state at and at an initial active power level of 0 MW and reactive power level of 0 MVAR. The EMS will be configured to follow an agreed-upon predefined reactive power profile. • Procedure:
(1) Record the Facility reactive power level at the Facility Meter. (2) Command the Facility to follow 30 MW for ten (10) minutes.
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Attachment 2
Yellow Pine Solar III, LLC
Exhibit O - 8
(3) Record and store the Facility reactive power response. • System end state: The Facility will be in the on-line state and at a commanded reactive power level of 0 MVAR.
E. Reactive Power Consumption Test
• Purpose: This test will demonstrate the reactive power consumption capability of the facility.
• System starting state: The Facility will be in the on-line state at and at an initial active power level of 0 MW and reactive power level of 0 MVAR. The Facility control system will be configured to follow an agreed-upon predefined reactive power profile.
• Procedure:
(1) Record the Facility reactive power level at the Facility Meter. (2) Command the Facility to follow 30 MW for ten (10) minutes. (3) Record and store the Facility reactive power response. • System end state: The Facility will be in the on-line state and at a commanded reactive power level of 0 MVAR.
Item 3
Attachment 2
Yellow Pine Solar III, LLC
Exhibit P - 1
EXHIBIT P
FACILITY AVAILABILITY CALCULATION
Monthly Capacity Availability Calculation. Seller shall calculate the “Monthly Capacity Availability” for a given month of the Delivery Term using the formula set forth below:
[AVAILHRSm + EXCUSEDHRSm]
Monthly Capacity Availability (%) =
[MONTHRSm]
Where:
m = relevant month “m” in which Monthly Capacity Availability is calculated; MONTHRSm is the total number of hours for the month;
AVAILHRSm is the total number of hours, or partial hours, in the month during which the Facility was available to charge and discharge Energy between the Facility and the Delivery Point and to provide Ancillary Services (provided that notwithstanding anything to the contrary set forth above in this Exhibit P or elsewhere in this Agreement, to the extent the Facility is unable to provide Ancillary Services for any reason not excused under this Agreement during any Settlement Interval or Settlement Period that is not otherwise deemed EXCUSEDHRSm, but the Facility is available to charge and discharge Energy between the Facility and the Delivery Point, then such impact on AVAILHRSm shall be reduced by ) at the Delivery Point (excluding, for avoidance of doubt, all circumstances at the high-voltage side of the Delivery Point or beyond that may limit Seller’s delivery of Product). If the Facility is available pursuant to the preceding sentence during any applicable hour, or partial hour, but for less than the full amount of the Effective Capacity, the AVAILHRSm for such time period shall be calculated by multiplying such AVAILHRSm by a percentage determined by dividing (a) by (b); where (a) is the Effective Capacity amount reported as available by Seller’s real-time EMS data feed to Buyer for the Facility for such hours, or partial hours, and (b) is the Effective Capacity.
EXCUSEDHRSm is the total number of hours, or partial hours, in the month that are not included as AVAILHRSm due to Approved Maintenance Hours, Storage Capacity Tests, Curtailment Orders, Force Majeure Events, System Emergencies, Operating Restrictions in Exhibit Q, Buyer breach or default, or any circumstances at the high-voltage side of the Delivery Point or beyond that point that may limit Seller’s delivery of Product (each, an “Excused Event”). If an Excused Event results in less than the full amount of the Effective Capacity for the Facility being unavailable during any applicable hour, or partial hour, the EXCUSEDHRSm for such time period shall be calculated by multiplying such EXCUSEDHRSm by a percentage determined by dividing (a) by (b); where (a) is the Effective Capacity amount that is reported as unavailable by Seller’s real-time EMS data feed to Buyer for the Facility for such hours, or partial hours, and (b) is the Effective Capacity. For avoidance of doubt, the total of AVAILHRSm plus EXCUSEDHRSm for any hour, or partial hour, shall never exceed 1.
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Yellow Pine Solar III, LLC
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Attachment 2
Yellow Pine Solar III, LLC
EXHIBIT Q
OPERATING RESTRICTIONS
The Parties will finalize the Operating Restrictions prior to the Commercial Operation Date; provided, the Operating Restrictions (i) may not be materially more restrictive of the operation of the Facility than as set forth below, unless agreed to by Buyer in writing, (ii) will, at a minimum, include the rules, requirements and procedures set forth in this Exhibit Q. (iii) will include protocols and parameters for Seller’s operation of the Facility in the absence of Discharging Notices or other similar instructions from Buyer relating to the use of the Facility, and (iv) may include facility scheduling, operating restrictions and Communications Protocols.
File Update Date:
Technology: Lithium Ion Batteries
Storage Unit Name:
A. Contract Capacity
Guaranteed Capacity (MW): 115
Effective Capacity (MW): 115 as determined by Storage Capacity Test B. Total Unit Dispatchable Range Information
Maximum Average Annual Storage Level
Maximum Storage Level (MWh): 460
Minimum Storage Level (MWh): 0
Maximum Charging Capacity 115
Maximum Discharging Capacity (MW): 115
C. Maximum Throughput
Maximum Dailv Throughput (MWh): 920 (2.0 cycles)
Maximum Annual Throughput (MWh):
Exhibit Q - 1
Item 3
Attachment 2
Yellow Pine Solar III, LLC
I. Data Points to Be Sent from Seller to Buyer Via a Mutually Agreeable Form The following data points will be transmitted via a mutually agreeable form from Seller to Buyer and represent energy storage level data:
Table 1
Energy Storage
Description Units
Real Power Set-Point (echo) MW
Actual Real Power MW
Actual Reactive Power MVar
Stored Energy Level MWh
Remaining Throughput (Contract Year) MWh
YTD average Stored Energy Level (Contract Year) MWh day Exhibit Q - 2
Exhibit Q - 3
Maximum Allowable Stored Energy Level MWh
Additional Data Points Reserved for Future Use
The following data points will be transmitted via a mutually agreeable form from Buyer to Seller and represent energy storage level data:
Table 2
Energy Storage
Description Units
Charge Power Set-Point* MW
Discharge Power Set-Point* MW
Duration of Charge/Discharge Set-Point* minutes
Target Stored Energy Level* %
Ramp Rate MW/s
Control Mode (target time or target SOC) Boolean
Additional Data Points Reserved for Future Use
* Parties will resolve any conflicts in priority of signal in the Operating Restrictions.
Data points transmitted via a mutually agreeable form from Seller to Buyer are subject to Operating Restrictions.
1. Response times of Storage Facility. The Operating Restrictions will include protocols that outline the expectations for responding to Buyer’s set points.
2. Backup Communications. In the event of a communications failure, Buyer and Seller shall communicate via telephone in order to correct the failure.
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Attachment 2
Yellow Pine Solar III, LLC
Exhibit R - 1
EXHIBIT R
METERING DIAGRAM
Preliminary Metering Diagram set forth on the following page. A final version of the Metering Diagram will be provided to Buyer at least thirty (30) days before the Commercial Operation Date, which will replace the attached version for purposes of this Agreement Item 3
Attachment 2
Yellow Pine Solar III, LLC
Exhibit R - 2
Item 3
Attachment 2
Yellow Pine Solar III, LLC
Exhibit S - 1
EXHIBIT S
FORM OF COLLATERAL ASSIGNMENT AGREEMENT
FORM OF CONSENT AND AGREEMENT
([NAME OF CONTRACTING PARTY])
([NAME OF ASSIGNED AGREEMENT])
This COLLATERAL ASSIGNMENT AGREEMENT (this “Consent”), dated as of ___________, 20[ ], is executed by and among [NAME OF CONTRACTING PARTY], a [legal form of Contracting Party] organized under the laws of the State of [________] (the “Contracting Party”), [__________], a [___________] (the “Project Owner”), and [_____________], as collateral agent (in such capacity, together with its successors and permitted assigns, the “Collateral Agent”) for various financial institutions named from time to time as Lenders under the Credit Agreement (as defined below) and any other parties (or any of their agents) who hold any other secured indebtedness permitted to be incurred under the Credit Agreement (the Collateral Agent and all such parties collectively, the “Secured Parties”).
A. The Project Owner owns, operates and maintains [_________________] (the “Project”).
B. The Contracting Party and the Project Owner have entered into the agreement specified in Schedule I hereto (as further amended, restated, supplemented or otherwise modified from time to time in accordance with the terms thereof and hereof, the “Assigned Agreement”).
C. The Borrower, the Project Owner, the other affiliates of the Borrower as Guarantors, various financial institutions named therein from time to time as Lenders,[_________________] , as the Administrative Agent and Collateral Agent, have entered into a Credit Agreement, dated as of [________________](as amended, modified or supplemented from time to time, the “Credit Agreement”), providing for the extension of the credit facilities described therein.
D. As security for the payment and performance by the Project Owner of its obligations under the Credit Agreement and the other Financing Documents (as defined below) and for other obligations owing to the Secured Parties, the Project Owner has assigned all of its right, title and interest in, to and under, and granted a security interest in, the Assigned Agreement to the Collateral Agent pursuant to the Assignment and Security Agreement, dated as of [_____________________]between the Project Owner and the Collateral Agent (as amended, restated, supplemented or otherwise modified from time to time in accordance with the terms thereof, the “Security Agreement”, and, together with the Credit Agreement and any other financing documents relating to the issuance of the Notes, the “Financing Documents”).
E. It is a requirement under the Credit Agreement that the Project Owner cause the Contracting Party to execute and deliver this Consent.
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Exhibit S - 2
NOW, THEREFORE as an inducement for Lenders to make the Loans, and for other good and valuable consideration, the receipt and adequacy of which is hereby acknowledged, and intending to be legally bound, the parties hereto hereby agree as follows:
1. Consent to Assignment. The Contracting Party hereby acknowledges and consents to the pledge and assignment of all right , title and interest of the Project Owner in, to and under (but not its obligations, liabilities or duties with respect to) the Assigned Agreement by the Project Owner to the Collateral Agent pursuant to the Security Agreement.
2. Representations and Warranties. The Contracting Party represents and warrants as follows:
(a) No Amendments. [Except as described in Schedule I hereto,] there are no amendments, modifications or supplements (whether by waiver, consent or otherwise) to the Assigned Agreement, either oral or written.
(b) No Previous Assignments. The Contracting Party affirms that it has no notice of any assignment relating to the right, title and interest of the Project Owner in, to and under the Assigned Agreement other than the pledge and assignment to the Collateral Agent referred to in Section 1 above.
(c) No Termination Event: No Disputes. After giving effect to the pledge and assignment referred to in Section 1, and after giving effect to the consent to such pledge and assignment by the Contracting Party, there exists no event or condition (a “Termination Event”) that would, either immediately or with the passage of time or giving of notice, or both, entitle either the Project Owner or the Contracting Party to terminate the Assigned Agreement or suspend the performance of its obligations under the Assigned Agreement. [Except as set forth on Schedule III hereto,] there are no unresolved disputes between the parties under the Assigned Agreement.
All amounts due under the Assigned Agreement as of the date hereof have been paid in full [, except as set forth on Schedule III hereto].
3. RIGHT TO CURE.
(a) From and after the date hereof and unless and until the Contracting Party shall have received written notice from the Collateral Agent that the lien of the Security Agreement has been released in full, the Collateral Agent shall have the right, but not the obligation, following an Event of Default by the Project Owner under the Assigned Agreement, to pay all sums due under the Assigned Agreement by the Project Owner and to perform any other act, duty or obligation required of the Project Owner thereunder as described in Section 3(c) below; provided, that no such payment or performance shall be construed as an assumption by the Collateral Agent or any other Secured Party of any covenants, agreements or obligations of the Project Owner under or in respect of the Assigned Agreement.
(b) The Contracting Party agrees that it will not (i) terminate the Assigned Item 3
Attachment 2
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Exhibit S - 3
Agreement [(other than pursuant to Section [__] of the Assigned Agreement)]1or (ii) suspend the performance of any of its obligations under the Assigned Agreement without first giving the Collateral Agent notice and opportunity to cure as provided below. The Contracting Party further agrees that it will not assign any obligation under the Assigned Agreement without the prior consent of the Collateral Agent, which consent shall not be unreasonably withheld, delayed or conditioned, except to the extent the Contracting Party may subcontract such obligations to other parties.
(c) If a Termination Event shall occur [(other than a termination pursuant to Section [__] of the Assigned Agreement)]2, and the Contracting Party shall then be entitled to and shall desire to terminate the Assigned Agreement or suspend the performance of any of its obligations under the Assigned Agreement, the Contracting Party shall, prior to exercising such remedies or taking any other action with respect to such Termination Event, give written notice to the Collateral Agent of such Termination Event. Collateral Agent will have the right, but not the obligation, to cure an Termination Event on behalf of Project Owner, only if Collateral Agent sends a written notice to Contracting Party before the later of (i) the expiration of any cure period under this Agreement, and (ii) fifteen (15) Business Days after Collateral Agent’s receipt of notice of such Termination Event from Contracting Party, indicating Collateral Agent’s intention to cure.
If the Collateral Agent elects to exercise its right to cure as herein provided, it shall have a period of thirty (30) days after receipt by it of notice from the Contracting Party referred to in the preceding sentence in which to cure the Termination Event specified in such notice if such Termination Event consists of a payment default, or if such Termination Event is an event other than a failure to pay amounts due and owing by the Project Owner (a “Non-monetary Event”) the Collateral Agent shall have a period of ninety (90) days after receipt by it of notice from the Contracting Party referred to in the preceding sentence in which to cure the Termination Event so long as the Collateral Agent has commenced and is diligently pursuing appropriate action to cure such Termination Event (or such longer additional period if the Collateral Agent is unable to cure such Termination Event within such initial ninety (90) day period despite exercising commercially reasonable efforts); provided, however, that (i) if possession of the Project is necessary to cure such Non-monetary Event and the Collateral Agent has commenced foreclosure proceedings, the Collateral Agent will be allowed a reasonable time to complete such proceedings, and (ii) if the Collateral Agent is prohibited from curing any such Non-monetary Event by any process, stay or injunction issued by any governmental authority or pursuant to any bankruptcy or insolvency proceeding or other similar proceeding involving the Project Owner, then the time periods specified herein for curing a Termination Event shall be extended for the period of such prohibition; provided, further, that in the event of items (i) or (ii) above, such time period shall not exceed one hundred eighty (180) days. Any cure period for the Collateral Agent shall not commence until the later of (i) the end of the cure period of the Project Owner under the Assigned Agreement and (ii) written notice from the Contracting Party to the Collateral Agent of a 1 Insert applicable provision, if any, of the Assigned Agreement giving the Contracting Party a right to terminate the Assigned Agreement other than upon a default or other event or condition curable by the Project Owner.
2 Insert applicable provision, if any, of the Assigned Agreement giving the Contracting Party a right to terminate the Assigned Agreement other than upon a default or other event or condition curable by the Project Owner.
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Attachment 2
Yellow Pine Solar III, LLC
Exhibit S - 4
Termination Event.
(d) Any curing of or attempt to cure any Termination Event shall not be construed as an assumption by the Collateral Agent or the other Secured Parties of any covenants, agreements or obligations of the Project Owner under or in respect of the Assigned Agreement. (e) Following a Termination Event by the Project Entity under the Assigned Agreement, the Contracting Party may require the Collateral Agent, if the Collateral Agent has provided the notice set forth in subsection (c) above, to provide to Contracting Party a report concerning:
(i) The status of efforts by Collateral Agent to develop a plan to cure the Termination Event;
(ii) Impediments to the cure plan or its development;
(iii) If a cure plan has been adopted, the status of the cure plan’s implementation (including any modifications to the plan as well as the expected timeframe within which any cure is expected to be implemented); and (iv) Any other information which Contracting Party may reasonably require related to the development, implementation and timetable of the cure plan.
Collateral Agent must provide the report to Contracting Party within twenty (20) Business Days after Notice from Contracting Party requesting the report. Contracting Party will have no further right to require the report with respect to a particular Termination Event after that Termination Event has been cured.
4. REPLACEMENT AGREEMENTS. NOTWITHSTANDING ANY
PROVISION IN THE ASSIGNED AGREEMENT TO THE CONTRARY, IN THE EVENT (I) THE ASSIGNED AGREEMENT IS REJECTED OR OTHERWISE TERMINATED AS
A RESULT OF ANY BANKRUPTCY, INSOLVENCY, REORGANIZATION OR
SIMILAR PROCEEDINGS AFFECTING THE PROJECT OWNER, AT THE COLLATERAL AGENT’S REQUEST, THE CONTRACTING PARTY WILL ENTER
INTO A NEW AGREEMENT WITH THE COLLATERAL AGENT OR THE
COLLATERAL AGENT’S DESIGNEE FOR THE REMAINDER OF THE ORIGINALLY
SCHEDULED TERM OF THE ASSIGNED AGREEMENT, EFFECTIVE AS OF THE
DATE OF SUCH REJECTION, WITH THE SAME COVENANTS, AGREEMENTS,
TERMS, PROVISIONS AND LIMITATIONS AS ARE CONTAINED IN THE ASSIGNED
AGREEMENT, OR (II) IF THE COLLATERAL AGENT OR ITS DESIGNEE,
DIRECTLY OR INDIRECTLY, TAKES POSSESSION OF, OR TITLE TO, THE
PROJECT (INCLUDING POSSESSION BY A RECEIVER OR TITLE BY
FORECLOSURE OR DEED IN LIEU OF FORECLOSURE) AFTER ANY SUCH
REJECTION OR TERMINATION OF THE ASSIGNED AGREEMENT, PROMPTLY AFTER THE CONTRACTING PARTY’S WRITTEN REQUEST, THE COLLATERAL
AGENT MUST ITSELF OR MUST CAUSE ITS DESIGNEE TO PROMPTLY ENTER
INTO A NEW AGREEMENT WITH THE CONTRACTING PARTY HAVING
SUBSTANTIALLY THE SAME TERMS AS THE ASSIGNED AGREEMENT FOR THE Item 3
Attachment 2
Yellow Pine Solar III, LLC
Exhibit S - 5
REMAINING TERM THEREOF, PROVIDED THAT IN THE EVENT A DESIGNEE OF
THE COLLATERAL AGENT, DIRECTLY OR INDIRECTLY, TAKES POSSESSION
OF, OR TITLE TO, THE PROJECT (INCLUDING POSSESSION BY A RECEIVER OR
TITLE BY FORECLOSURE OR DEED IN LIEU OF FORECLOSURE), SUCH
DESIGNEE SHALL BE APPROVED BY THE CONTRACTING PARTY, NOT TO BE UNREASONABLY WITHHELD.
5. SUBSTITUTE OWNER. THE CONTRACTING PARTY
ACKNOWLEDGES THAT IN CONNECTION WITH THE EXERCISE OF REMEDIES
FOLLOWING A DEFAULT UNDER THE FINANCING DOCUMENTS, THE
COLLATERAL AGENT MAY (BUT SHALL NOT BE OBLIGATED TO) ASSUME, OR
CAUSE ANY PURCHASER AT ANY FORECLOSURE SALE OR ANY ASSIGNEE OR
TRANSFEREE UNDER ANY INSTRUMENT OF ASSIGNMENT OR TRANSFER IN
LIEU OF FORECLOSURE TO ASSUME, ALL OF THE INTERESTS, RIGHTS AND
OBLIGATIONS OF THE PROJECT OWNER THEREAFTER ARISING UNDER THE ASSIGNED AGREEMENT. SUCH SALE OR TRANSFER MAY BE MADE ONLY TO AN ENTITY THAT (I) MEETS THE DEFINITION OF “PERMITTED TRANSFEREE” AS
DEFINED IN THE ASSIGNED AGREEMENT AND (II) IS AN ENTITY THAT THE
CONTRACTING PARTY IS PERMITTED TO CONTRACT WITH UNDER
APPLICABLE LAW. IF THE INTEREST OF THE PROJECT OWNER IN THE
ASSIGNED AGREEMENT SHALL BE ASSUMED, SOLD OR TRANSFERRED AS
PROVIDED ABOVE, THE ASSUMING PARTY SHALL AGREE IN WRITING TO BE
BOUND BY AND TO ASSUME THE TERMS AND CONDITIONS OF THE ASSIGNED
AGREEMENT AND ANY AND ALL OBLIGATIONS TO THE CONTRACTING PARTY
ARISING OR ACCRUING THEREUNDER FROM AND AFTER THE DATE OF SUCH
ASSUMPTION, AND THE CONTRACTING PARTY SHALL CONTINUE TO
PERFORM ITS OBLIGATIONS UNDER THE ASSIGNED AGREEMENT IN FAVOR OF
THE ASSUMING PARTY AS IF SUCH PARTY HAD THEREAFTER BEEN NAMED AS THE “CUSTOMER” UNDER THE ASSIGNED AGREEMENT; PROVIDED THAT IF
THE COLLATERAL AGENT OR ITS DESIGNEE (OR ANY ENTITY ACTING ON BEHALF OF THE COLLATERAL AGENT, THE COLLATERAL AGENT’S DESIGNEE
OR ANY OF THE OTHER SECURED PARTIES) ASSUMES THE ASSIGNED
AGREEMENT AS PROVIDED ABOVE, IT SHALL BE PERSONALLY LIABLE FOR
THE PERFORMANCE OF THE OBLIGATIONS THEREUNDER SOLELY TO THE EXTENT OF ALL OF ITS RIGHT, TITLE AND INTEREST IN AND TO THE PROJECT.
6. PAYMENTS. THE CONTRACTING PARTY SHALL MAKE ALL
PAYMENTS DUE TO THE PROJECT OWNER UNDER THE ASSIGNED AGREEMENT
DIRECTLY INTO THE ACCOUNT SPECIFIED ON SCHEDULE II HERETO, OR TO
SUCH OTHER PERSON OR ACCOUNT AS SHALL BE SPECIFIED FROM TIME TO
TIME BY THE COLLATERAL AGENT TO THE CONTRACTING PARTY IN WRITING. ALL PARTIES HERETO AGREE THAT EACH PAYMENT BY THE
CONTRACTING PARTY AS SPECIFIED IN THE PRECEDING SENTENCE OF
AMOUNTS DUE TO THE PROJECT OWNER FROM THE CONTRACTING PARTY
UNDER THE ASSIGNED AGREEMENT SHALL SATISFY THE CONTRACTING PARTY’S CORRESPONDING PAYMENT OBLIGATION UNDER THE ASSIGNED AGREEMENT.
Item 3
Attachment 2
Yellow Pine Solar III, LLC
Exhibit S - 6
7. NO AMENDMENTS. THE CONTRACTING PARTY
ACKNOWLEDGES THAT THE FINANCING DOCUMENTS RESTRICT THE RIGHT
OF THE PROJECT OWNER TO AMEND OR MODIFY THE ASSIGNED AGREEMENT,
OR TO WAIVE OR PROVIDE CONSENTS WITH RESPECT TO CERTAIN
PROVISIONS OF THE ASSIGNED AGREEMENT, UNLESS CERTAIN CONDITIONS SPECIFIED IN THE FINANCING DOCUMENTS ARE MET. THE CONTRACTING
PARTY SHALL NOT, WITHOUT THE PRIOR WRITTEN CONSENT OF THE
COLLATERAL AGENT, WHICH CONSENT SHALL NOT BE UNREASONABLY
WITHHELD, DELAYED OR CONDITIONED, AMEND OR MODIFY THE ASSIGNED
AGREEMENT IN ANY MATERIAL RESPECT, OR ACCEPT ANY WAIVER OR
CONSENT WITH RESPECT TO A MATERIAL PROVISION OF THE ASSIGNED
AGREEMENT, UNLESS THE CONTRACTING PARTY HAS RECEIVED FROM THE
BORROWER OR PROJECT OWNER (AS APPLICABLE UNDER THE FINANCING
DOCUMENTS) A COPY OF A CERTIFICATE DELIVERED BY THE PROJECT
OWNER TO THE COLLATERAL AGENT TO THE EFFECT THAT SUCH
AMENDMENT, MODIFICATION, WAIVER, OR CONSENT IS BEING MADE IN
ACCORDANCE WITH THE TERMS AND CONDITIONS OF THE FINANCING
DOCUMENTS, WHICH MAY IN CERTAIN CIRCUMSTANCES REQUIRE THE
BORROWER OR THE PROJECT OWNER (AS APPLICABLE UNDER THE
FINANCING DOCUMENTS) TO HAVE OBTAINED THE PRIOR WRITTEN CONSENT OF THE COLLATERAL AGENT, LENDERS, OR OTHER PARTIES THERETO.
8. ADDITIONAL PROVISIONS. [TO BE SPECIFIED IF NECESSARY TO CLARIFY THE ASSIGNED AGREEMENT.]
9. NOTICES. NOTICE TO ANY PARTY HERETO SHALL BE IN
WRITING AND SHALL BE DEEMED TO BE DELIVERED ON THE EARLIER OF: (A)
THE DATE OF PERSONAL DELIVERY, (B) POSTAGE PREPAID, REGISTERED OR
CERTIFIED MAIL, RETURN RECEIPT REQUESTED, OR SENT BY EXPRESS
COURIER, IN EACH CASE ADDRESSED TO SUCH PARTY AT THE ADDRESS
INDICATED BELOW (OR AT SUCH OTHER ADDRESS AS SUCH PARTY MAY HAVE
THERETOFORE SPECIFIED BY WRITTEN NOTICE DELIVERED IN ACCORDANCE
HEREWITH), UPON DELIVERY OR REFUSAL TO ACCEPT DELIVERY, OR (C) IF
TRANSMITTED BY FACSIMILE, THE DATE WHEN SENT AND FACSIMILE CONFIRMATION IS RECEIVED; PROVIDED THAT ANY FACSIMILE
COMMUNICATION SHALL BE FOLLOWED PROMPTLY BY A HARD COPY ORIGINAL THEREOF BY EXPRESS COURIER:
The Collateral Agent: [________________________]
[ ]
Attn: [ ]
Telephone No.: [ ]
Facsimile No.: [ ]
The Project Owner:
Item 3
Attachment 2
Yellow Pine Solar III, LLC
Exhibit S - 7
The Contracting Party:
10. SUCCESSORS AND ASSIGNS. THIS CONSENT SHALL BE
BINDING UPON AND SHALL INURE TO THE BENEFIT OF THE SUCCESSORS AND
ASSIGNS OF THE CONTRACTING PARTY, AND SHALL INURE TO THE BENEFIT
OF THE COLLATERAL AGENT, THE OTHER SECURED PARTIES, THE PROJECT OWNER AND THEIR RESPECTIVE SUCCESSORS, TRANSFEREES AND ASSIGNS.
11. COUNTERPARTS. THIS CONSENT MAY BE EXECUTED IN ONE
OR MORE COUNTERPARTS WITH THE SAME EFFECT AS IF THE SIGNATURES THERETO AND HERETO WERE UPON THE SAME INSTRUMENT.
12. GOVERNING LAW. THIS CONSENT SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF _______________.
Item 3
Attachment 2
Yellow Pine Solar III, LLC
Exhibit S - 8
IN WITNESS WHEREOF, the parties hereto have caused their duly authorized officers to execute and deliver this Consent as of the date first written above. [NAME OF CONTRACTING PARTY]
By:
Name:
Title:
[________________________]
as Collateral Agent
By:
Name:
Title:
Acknowledged and Agreed:
[_____________________________]
By:
Name:
Title:
Item 3
Attachment 2
Yellow Pine Solar III, LLC
Schedule I
Assigned Agreement
Item 3
Attachment 2
Yellow Pine Solar III, LLC
Schedule II
Payment Instructions
(Section 6)
All payments due to the Project Owner pursuant to the Assigned Agreement shall be made to [INSERT REVENUE ACCOUNT INFORMATION].
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Attachment 2
Yellow Pine Solar III, LLC
Exhibit S - 11
[Schedule III]
[Amounts Due and Unpaid under the Assigned Agreement
(Section 2(c))]
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Attachment 2
Yellow Pine Solar III, LLC
Exhibit T - 1
EXHIBIT T
FORM OF ESTOPPEL CERTIFICATE
ESTOPPEL CERTIFICATE
(Energy Storage Agreement)
This ESTOPPEL CERTIFICATE (this “Estoppel Certificate”), dated as of ____________ __, 202_, is provided by ___________________, a _________________ (“Buyer”).
RECITALS
A. Buyer and ______________________, a Delaware limited liability company (the “Project Company”) are parties to that certain Energy Storage Service Agreement, dated as of ______________, 202_ (the “Energy Storage Agreement”), in connection with the _______ storage project (“Storage Project”).
B. Pursuant to that certain [describe Lender financing agreement].
C. Pursuant to Section [__] of the [Lender financing agreement], the [Lenders] have required that this Estoppel Certificate be delivered as a condition precedent to the consummation of the transactions described therein.
NOW, THEREFORE, in consideration of the foregoing recitals, Buyer hereby certifies, agrees and acknowledges as follows:
1. No default or event of default with respect to Buyer, nor, to the knowledge of Buyer, any other party has occurred under the Energy Storage Agreement, and there are no defaults or unsatisfied conditions presently existing (or which would exist after the passage of time and/or giving of notice) that would allow the Project Company or Buyer to terminate the Energy Storage Agreement.
2. There exists no event or condition that would, either immediately or with the passage of time or giving of notice, or both, entitle either the Project Company or Buyer to suspend the performance of its obligations under the Energy Storage Agreement.
3. Each representation or warranty made or given by Buyer in Section [__] of the Energy Storage is complete, true and correct.
4. As of the date hereof, (i) the Energy Storage Agreement is in full force and effect and has not been assigned, amended, supplemented or modified, (ii) there are no pending or threatened disputes or legal proceedings between Buyer and the Project Company, (iii) there is no pending or, to the knowledge of Buyer, Item 3
Attachment 2
Yellow Pine Solar III, LLC
Exhibit T - 2
5. threatened action or proceeding involving or relating to Buyer before any court, tribunal, governmental authority or arbitrator which purports to affect the legality, validity or enforceability of the Energy Storage Agreement, (iv) Buyer is not aware of any event, act, circumstance or condition constituting an event of force majeure under the Energy Storage Agreement, and (v) the Project Company owes no indemnity payments or other amounts to Buyer under the Energy Storage Agreement.
6. The execution, delivery and performance by Buyer of this Estoppel Certificate have been duly authorized by all necessary action on the part of Buyer and do not require any approval or consent of any other person or entity and do not violate any provision of any law, regulation, order, judgment, injunction or similar matters or breach any agreement presently in effect with respect to or binding on Buyer.
7. Buyer agrees that any notices required to be delivered to Seller under Section [__] of the Energy Storage Agreement, including notices of an [Event of Default], shall be delivered by Buyer to each of the [Lenders] at their respective notice addresses set forth on Exhibit A hereto, and Buyer agrees that the [Lenders] shall have the right (but not the obligation) to cure the defaults listed in any notice of default in accordance with Section [__] of the Energy Storage Agreement within a cure period that is the same length as the cure period afforded to Seller under the Energy Storage Agreement with respect to such event (but in no event less than 90 days), and which starts on the later of (i) the same date that the Seller’s cure period expires under the Energy Storage Agreement or (ii) the date that the [Lenders] receive such notice that lists the default or defaults of the Seller under the Energy Storage Agreement.
8. [Additional provisions to be included if necessary to clarify the Energy Storage Agreement.]
9. This Estoppel Certificate shall be governed by the laws of ____________, without regard to principles of conflict of law.
[Signature page follows]
Item 3
Attachment 2
Yellow Pine Solar III, LLC
Exhibit T - 3
IN WITNESS WHEREOF, Buyer has caused this Estoppel Certificate to be executed by its undersigned authorized officer as of the date first set forth above.
By: ____________________________
Name:_______________________
Title:________________________
Item 3
Attachment 2
Yellow Pine Solar III, LLC
Item 3
Attachment 3
SILICON VALLEY CLEAN ENERGY AUTHORITY
RESOLUTION NO. 2019-12
A RESOLUTION OF THE BOARD OF DIRECTORS OF THE SILICON VALLEY CLEAN ENERGY
AUTHORITY DELEGATING AUTHORITY TO THE CHIEF EXECUTIVE OFFICER TO NEGOTIATE
NON-STANDARD PRICING AGREEMENTS FOR ELIGIBLE LARGE COMMERCIAL AND
INDUSTRIAL CUSTOMERS
THE BOARD OF DIRECTORS OF THE SILICON VALLEY CLEAN ENERGY AUTHORITY HEREBY RESOLVES AS FOLLOWS:
WHEREAS, the Silicon Valley Clean Energy Authority (“SVCE”) was formed on March 31, 2016, pursuant to a Joint Powers Agreement to promote, develop, conduct, operate, and manage energy programs in Santa Clara County;
WHEREAS, Silicon Valley Clean Energy launched service under a community choice aggregation program on April 3, 2017;
WHEREAS, commercial and industrial customers make up a substantial majority of SVCE’s electric load;
WHEREAS, commercial and industrial customers are critical partners in helping SVCE and its member agencies reduce carbon emissions and meet climate action planning goals; WHEREAS, the state of California adopted new legislation to re-open the cap for Direct Access to the wholesale markets for commercial and industrial customers under SB 237 in September 2018; WHEREAS, in the expanded Direct Access marketplace, current SVCE commercial and industrial customers may opt out to receive DA service under more flexible or lower-cost tariff structures; WHEREAS, SVCE seeks to provide clean, carbon-free electricity services that meet customer needs, at rates that are competitive and contribute positively to SVCE’s financial position; WHEREAS, the Direct Access marketplace is highly competitive, requiring that SVCE structure non-standard pricing agreement terms in a highly responsive, time-sensitive fashion; WHEREAS, SVCE wishes to offer non-standard pricing agreements to retain eligible commercial and industrial accounts, under the terms of the attached ‘Non-Standard Pricing Agreement Policy’ WHEREAS, in order to expedite the approval of non-standard pricing agreements consistent with Direct Access marketplace requirements, the Board wishes to delegate to the Chief Executive Officer the authority to negotiate directly with eligible commercial and industrial accounts in accordance with the Board approved Non-Standard Pricing Agreement Policy.
NOW, THEREFORE, THE BOARD OF DIRECTORS OF THE SILICON VALLEY CLEAN ENERGY AUTHORITY DOES HEREBY RESOLVE, DETERMINE, AND ORDER AS FOLLOWS:
Section 1. The Board hereby delegates authority to the Chief Executive Officer to negotiate and execute non-standard pricing agreements with eligible large commercial and industrial customers, provided that the pricing agreements meet the minimum requirements set forth in the Non-Standard Pricing Agreement Policy
Resolution 2019-12
Item 3
Attachment 3
PASSED AND ADOPTED this 12th day of June 2019, by the following vote:
JURISDICTION NAME AYE NO ABSTAIN ABSENT
City of Campbell Director Gibbons ^y
City of Cupertino Director Sinks
City of Gilroy Director Tovar
City of Los Altos Alternate Director Fligor
Town of Los Altos Hills Director Corrigan
Town of Los Gatos Director Sayoc y
City of Milpitas Director Nunez y
City of Monte Sereno Director Javed Ellahie
City of Morgan Hill Director Martinez Beltran
City of Mountain View Director Abe-Koga
County of Santa Clara Director Ellenberg
City of Saratoga Director Miller
City of Sunnyvale Director Smith
Resolution 2019-12
SILICON VALLEY CLEAN ENERGY AUTHORITY
NON-STANDARD PRICING AGREEMENT POLICY
When offering non-standard pricing agreements to eligible customers, SVCE adheres to a defined non-standard pricing agreement policy. A non-standard pricing agreement will apply to electric generation services, and if applicable, may include consideration and valuation of supporting products or services.
Under this policy, the non-standard pricing agreement must:
1) apply exclusively to customers with annual load in SVCE’s service territory greater than 10GWh 2) be marginal cost-based and account for any volume and/or price risk 3) be priced to allow SVCE to cover variable costs and achieve some level of contribution to fixed cost and reserve margin, in conformance with SVCE’s financial objectives, Risk Management Policy and controls.
4) require a commitment level from the customer (e.g. volume, length of term) commensurate with the non-standard pricing agreement offered to the customer
5) meet SVCE’s carbon-free requirements, and be consistent with SVCE’s decarbonization strategy for power supply, transportation and the built environment
Item 3
Attachment 3
Staff Report – Item 4
Item 4: Provide Feedback on the FY 2023-24 Proposed Operating Budget and Updated Reserves Policy
From: Girish Balachandran, CEO
Prepared by: Amrit Singh, CFO and Director of Administrative Services Date: 8/9/2023
RECOMMENDATION
In preparation for adopting the budget in September 2023, Staff recommends that the Board of Directors provide feedback on the fiscal year (FY) 2023-24
1 Proposed Operating Budget that projects depositing $7.7 million into the reserves and the updated Reserves Policy that increases the reserve target from 285 days of cash on hand (DCOH) to 300.
FINANCE AND ADMINISTRATION, EXECUTIVE COMMITTEE & BOARD REVIEWs At the May 12th Finance and Administration Committee meeting, the May 26th Executive Committee meeting, and the June 14th Board of Directors meeting, staff presented the methodology, framework, and key assumptions for developing the proposed budget and responded to the Committees and Board members’ questions on the approach to developing the budget.
Staff presented a preliminary budget outlook at the June 23rd Executive Committee meeting. Staff informed the Committee that the final budget numbers will be developed using July’s latest energy price market data.
The Committee provided feedback on the preliminary budget, including comparing SVCE’s full-time staff numbers with those of the other CCAs. Staff discussed the high volatility in the energy markets and the high prices for Resource Adequacy (RA) and Renewable Portfolio Standard (RPS) products, which added additional uncertainty to budget projections. Staff discussed removing the request to transfer funds towards an SVCE building purchase if margin projections deteriorate further.
Staff presented the Proposed Operating Budget and the recommendation to increase the target DCOH level in the reserves policy to the Finance and Administration Committee on August 1, 2023. Staff explained the difficulty in modeling RA and RPS prices, their impact on SVCE’s revenue forecast, and the modeling assumptions of these prices, holding other variables constant, could create conservative budget projections.
The Committee unanimously supported the potential conservative approach to modeling SVCE’s revenues.
Although not in the proposed budget, the Committee encouraged staff to continue assessing opportunities for purchasing an SVCE office building and to return to the Committee and the Board with any attractive opportunities. The Committee unanimously recommended that the Board adopt the Proposed Operating Budget and change the reserve policy to increase the DCOH target from 285 to 300.
ANALYSIS & DISCUSSION
1 The fiscal year 2023-24 starts on October 1, 2023, and ends on September 30, 2024.
Item 4
SILICON VALLEY \3/ CLEAN ENERGY
Agenda Item: 4 Agenda Date: 8/9/2023
The FY 2023-24 Proposed Operating Budget is balanced and presents Silicon Valley Clean Energy (SVCE) in stable financial condition. The projected balance available for reserves of $7.7 million is a decrease of $65.7 million from the $73.4 million presented in the FY 2022-23 Mid-Year Budget.
Energy Revenues
The Proposed budget shows a decrease in revenues of $83.6 million compared to the FY 2022-23 adjusted mid-year budget. The revenue decrease is primarily due to a forecasted increase in 2024 PCIA2 of about 318 percent (from 0.28 cents/kWh to 1.17 cents/kWh) and a drop in the 2024 PG&E generation rate of about 28 percent on average (from 14.08 cents/kWh to 11.55 cents/kWh) because of recent declines in forward energy prices. From late March to early July, the energy prices for the calendar year 20233 are down about 18%, and the forward prices for the calendar year 2024 are down on average about 14%. Declining market prices typically result in a simultaneous increase in PCIA and a decrease in PG&E generation rates. The significant rise in PCIA combined with a drop in PG&E generation rates reduces SVCE margins on average by 27 percent for 2024.
Staff used the CalCCA’s4 NewGen Strategies & Solutions Model to forecast PCIA and PG&E generation rates with updated market prices and an adjustment for modeling error by calibrating the model with PG&E’s May ERRA5forecast of 2024 rates. Staff did not update the model’s forecast of RA and RPS prices. Unlike prior years, RPS prices and Resource Adequacy costs are highly volatile and at very high levels compared to those in the past, creating an additional layer of uncertainty in forecasting PCIA and PG&E generation rates.
Unlike energy prices, where there are readily available market-traded forward prices, the Resource Adequacy (RA) and Renewable Portfolio Standard (RPS) prices used in the PCIA and PG&E generation rate calculations are based on CPUC’s derived market price benchmarks (MPB), which are published later in the fall of the year.
It’s difficult to forecast CPUC’s MPB prices because CPUC calculates them using a volume-weighted average of Load Serving Entities (LSE) market transactions, which can span forward transactions entered by the LSEs during the prior two years. The NewGen Strategies & Solutions MPB prices are very low compared to the current market prices. For example, the current market price for RPS product is about $45 MWh for the calendar year 2024, but those used in the model are about $12.50 per MWh, and for RA, it’s modeled at about $8.50 per kW-month versus the market price of around $12.75 per kW-month. In computing SVCE’s Power Supply costs, staff computed the open RA and RPS positions cost at current market prices. Holding for other variables, this disparity in RA and RPS prices used for projecting costs versus PCIA and PG&E generation rates tends to make the budget forecast conservative. For illustrative purposes, if we used the higher RA and RPS prices in the NewGen model to estimate PCIA and PG&E generation rates, the fiscal year 2023-24 revenues would be about $100 million higher.
PG&E’s forecast of 2024 rates in the ERRA filing made in May, shows a very high PG&E Generation Rate of ~14.546 cents/kWh and a very low PCIA of negative 0.62 cents/kWh, implying an improvement in SVCE margin of about 6 percent relative to current rates. PG&E’s filing, however, is based on results using market prices in late March 2023, and since then, market prices have decreased significantly, as stated earlier in the report. Based on the ERRA filing schedule, PG&E will update its rate forecast in early fall, and the CPUC is expected to approve new rates in late December.
2 Public Utility Code Sections 366.1 and 366.2 require the CPUC to make sure that customers leaving PG&E do not burden remaining PG&E customers with costs which were incurred to serve them. To ensure customer indifference, CCAs and Direct Access, or departing load customers are required to pay a power charge indifference adjustment (PCIA).
3 Calendar year 2023 calculation includes actuals for past months and forwards for future months. 4 CalCCA, California Community Choice Association, is the trade association of 24 CCAs in California. SVCE has been a member of CalCCA since its inception in 2017.
5 ERRA, the Energy Resource Recovery Account, is a balancing account utilized by PG&E to record and recover power costs associated with PG&E’s authorized procurement plan. ERRA proceedings are used to determine fuel and purchased power costs which can be recovered in rates. 6 The rates shown in this report are SVCE load-weighted average rates.
Item 4
Agenda Item: 4 Agenda Date: 8/9/2023
To test the accuracy of the NewGen model, staff calibrated the model to PG&E’s forecast using the same period market data PG&E used in developing its 2024 rate forecast. The calibration shows that the model results in about a 5 percent higher SVCE margin. Using the methodology discussed in the budget framework discussions to account for potential modeling errors, staff reduced the resulting margins from the current model by 10 percent.
Using the NewGen model with the latest prices and an adjustment for modeling error likely better aligns revenues closer to the rates that PG&E will update in October, and it also better aligns revenues with power supply costs because both estimates are made using the same set of energy market data. Nevertheless, the results are based on a forecast, and the actual rates won’t be known until the CPUC approval, expected in late December. Between now and when the rates are finalized, market prices will change, which can create less or more favorable results. Staff recommends that SVCE change its rates when the CPUC makes the new PCIA and PG&E generation rates effective. At that time, the Board can revisit the customer discount rate. The effective SVCE rate discount is modeled at 2% starting January 2024 to set the budget. The current 4 percent discount remains until the end of December 2023. The 2 percent effective discount rate is composed of a 1 percent discount relative to comparable PG&E generation rates for all customers and an additional 1 percent converted to dollar bill credits to the CARE & FERA customers (~30,000), which amounts to $3.14 million or about $8.70 per month bill credit for 12 months. The budget shows the bill credit as a separate cost item.
The proposed budget continues to reduce revenues to account for potential write-offs that could occur. SVCE is currently budgeting revenues to include a 0.75% write-off rate, which amounts to roughly $3.3 million.
Power Supply Expenses
Power supply expenses are expected to remain close to the current fiscal year level at $391.6 million. The drop in forward prices reduces costs but only to an extent because the portfolio for the calendar year 2024 is currently hedged at 78 percent. Additional Power Purchase Agreements (PPAs) coming online also further reduce costs. However, the favorable drivers reducing costs are offset by an increase in load of about 1.5%, as the forecast assumes full recovery from COVID impacts and much higher RPS and RA prices.
Reserves Policy Target Levels
At the June 14th, 2023, Board of Directors meeting, staff presented the results of the stress test analyses and emphasized the need to hold sufficient reserves to ensure SVCE can withstand risks such as those modeled in the analyses. The stress test modeled a collapse in energy prices that substantially reduced revenues and increased financial posting requirements to the Provider of Last Resort (PG&E). Staff has since updated the stress test scenario analysis with market and portfolio data consistent with those used to develop the proposed budget.
As shown in the table below, the new implied targets, derived using the methodology discussed in the stress test analysis, are close to the current targets. The methodology for deriving the targets is to set the target level such that if the modeled stress scenario were to occur, reserves remain above 120 days of cash on hand (DCOH) for the next two fiscal years and set the upper reserve target such that it remains above 90 DCOH over the next five fiscal years. Given the conservative assumptions used in modeling RA and RPS prices to derive the PCIA and PG&E generation rate forecasts and the 5-yr financial projection shown in attachment 2 showing ending reserves will be below target levels in the near future, staff considered keeping the existing targets.
On July 26th, Moody’s Investor Service, a credit rating agency, upgraded SVCE’s issuer rating from Baa2 to Baa1 with a stable outlook. Strong liquidity and adopting a more stringent reserves policy with a higher reserve target of 285 days were cited as credit-positive elements. Moody’s also indicated that “Maintenance of strong liquidity position through sound financial management with days cash on hand in excess of 300 days” would be one of several factors that could lead to a rating upgrade. Given that 300 DCOH is close to the current level and supported by the current stress test analysis, staff recommends increasing the target Item 4
Agenda Item: 4 Agenda Date: 8/9/2023
reserve DCOH level to 300 from 285. This change would not only continue to align the target level to the stress test analysis but would also align it with one of Moody’s key criteria in assessing our credit rating.
The attached redlined Reserves Policy shows the proposed change to the reserve target level.
As presented in the June Stress Test report and presentation, the upcoming fiscal year margins are not guaranteed, given the true-up in 2025 for PCIA and PG&E generation rates. If the adverse-modeled risk conditions materialize, the reserves policy targets maintaining at least 120 DCOH, which will be needed to reshape strategy and secure additional liquidity, and the upper reserves target helps manage risks over 5 years.
Operating Expenses
Operating expenses are expected to grow in the proposed budget, increasing by $4.8 million from the FY2022- 23 adjusted midyear budget. The increase in projected operating expenses is primarily comprised of costs associated with increased staffing. In addition, the operating budget includes an overall 5% contingency, which amounts to $1.5 million embedded in all operating expense category increases.
Overall personnel expenses are expected to increase by $4.1 million, of which $1.8 million, approximately 40% of the increase, is associated with the nine new positions across the organization. The remaining part of the increase is driven by filling vacancies and budgeting for salary increases.
The nine new positions reflect the increasing needs of a mature organization. These new positions focus on program design, marketing, and deployment; data analyses; data engineering to integrate various energy wholesale and portfolio operational data; supporting regulatory work; analytical and administrative work; and budgeting and financial analyses. Of the nine new positions since last fiscal year, one Associate Data Scientist position is filled, and one Senior Regulatory Analyst position is currently being recruited under the CEO’s personnel authority, which allows the CEO to add positions within 10 percent of the authorized number and the approved budget. In addition to these new positions, SVCE continues to work with specialized consultants who provide critical skills to bridge gaps between full-time staff.
Of the increase in personnel costs, $1.5 million arose from lower vacancy savings than the Mid-Year budget, which was partially based on actual vacancy rates as opposed to the 5 percent annual vacancy rate assumed in the proposed budget. SVCE continues to work to fill positions and anticipates full staffing by the end of the calendar year but utilizes a 5% long-term vacancy rate in the personnel budget.
The salary portion of the staffing budget includes a 4.5% cost-of-living adjustment to salaries, based on a trailing six-month average for the Bay Area CPI, which adds $500 thousand in additional cost. SVCE is budgeting for a 3% average merit increase, to be determined by management during the upcoming annual review process, and which contributes another $300 thousand in cost increases.
Other marketing, general and administration expenses, and professional services increase by about $680 thousand. These primarily result from increased hardware, travel, training, and conference fees anticipated for a larger staff.
Item 4
Reserve Targets(DCOH) Current New
Minimum 120 120
Goal (Target) 285 300
Maximum (Upper Target) 490 490
Agenda Item: 4 Agenda Date: 8/9/2023
Staff is also currently evaluating employee benefits package updates, focusing on incentives to promote staff retention. The current budget does not include these changes, but staff will likely present some benefits updates later during the fiscal year.
Programs Budget
SVCE will continue incorporating projected programs spending over the 5-year forecast period into the reserve balance projections and now in forecasting the ending net position as shown in the 5-year financial forecast in attachment 2. For this coming fiscal year, programs spending is projected to be $27.1 million, with an additional $3.5 million in CRCR7 spending and $600 thousand in E-Elec (all electric) rate discounts.
The proposed budget transfers an additional $8.9 million, two percent of projected revenues and $2.2 million from the PG&E nuclear allocation savings, representing the portfolio’s savings from accepting the allocation.
Non-Operating Revenues
Non-operating revenues are projected to increase by about $1.6 million. This increase reflects the interest earned on the growing reserve balance.
Set Aside for a Building Fund
During the budget framework discussions, staff proposed considering buying a building instead of leasing the current office space. SVCE’s current lease runs through September 2025. Before the lease expires, staff will need time to explore the alternatives of buying versus leasing. Staff also wants SVCE to be able to pursue attractive property opportunities as they arise. Staff proposes to continue assessing the market opportunities and return to the Board later to earmark a portion of reserves for potential building purchase. An initial back-of-the-envelope analysis indicates a roughly 10-year breakeven period compared to leasing for 20,000 sf space at a cost of around $20 million.
STRATEGIC PLAN
The recommendation supports all goals of the Board adopted Strategic Plan. Specifically, the recommendations strongly support Goal 15 - “Commit to maintaining a strong financial position” and the accompanying Measures “Present Balanced budget that achieves cash reserve targets, weighs tradeoffs between customer value proposition and contribution to reserves and maintains competitive rates”; “Board presentation on 5-year financial forecast once a year” and “Maintain investment grade credit rating from one of the three credit rating agencies.”
ALTERNATIVE
Staff is open to feedback and suggestions from the Board. At a strategic level, the Board can change the discount to PG&E, reduce the carbon-free percent of power supply, reduce the renewable percent of the power supply, and cut the programs expenditure.
Considering any of the above options requires an extensive policy-level discussion, and the Board can consider them while finalizing SVCE’s strategic priorities and revisit the customer discount rate when actual PCIA and PG&E generation rates are known. Given a sufficient projected reserve balance that maintains SVCE’s stable financial condition, staff does not recommend any specific reductions.
FISCAL IMPACT
The FY 2023-24 Proposed Operating Budget includes total revenues of $440.4 million and total expenses, non-operating revenues, and transfers of $432.7 million, resulting in a surplus/contribution to reserves of $7.7 million.
7 CRCR, the ~$10 million Customer Relief and Community Resilience Program, was established in 2020 to provide COVID credit payments to income-qualified customers as bill assistance, support local workforce training, and fund resiliency planning and capital expenditures at SVCE member cities.
Item 4
Agenda Item: 4 Agenda Date: 8/9/2023
ATTACHMENTS
1. FY 2023-24 Proposed Operating Budget
2. 5-year Financial Forecast
3. Updated Financial Reserves Policy
Item 4
Attachment 1
SILICON VALLEY CLEAN ENERGY
FY 2023-24 OPERATING BUDGET
($ in thousands)
MY 2022-23 FY 2023-24
ADJUSTED PROPOSED
DESCRIPTION BUDGET BUDGET $ %
ENERGY REVENUES
Energy Sales 522,853 438,342 (84,511) -16.2%
Green Prime 1,055 2,012 957 90.7%
Other Income 50 50 0 0.0%
TOTAL ENERGY REVENUES 523,958 440,404 (83,554) -15.9%
ENERGY EXPENSES
Power Supply 392,436 391,624 (812) -0.2%
OPERATING MARGIN 131,522 48,780 (82,742) -62.9%
OPERATING EXPENSES
Data Management 3,413 3,413 0 0.0%
PG&E Fees 1,470 1,470 0 0.0%
Salaries and Retirement 11,285 15,406 4,121 36.5%
Professional Services 8,016 8,084 68 0.9%
Marketing & Promotions 862 1,349 487 56.5%
Notifications 131 21 (110) -84.0%
Lease 525 551 26 5.0%
General & Administrative 1,857 2,067 209 11.3%
TOTAL OPERATING EXPENSES 27,559 32,361 4,802 17.4%
OPERATING INCOME (LOSS) 103,963 16,419 (87,544) -84.2%
NON-OPERATING REVENUES
Interest Income 3,870 5,501 1,631 42.1%
Grant Income 0 0 0 -
TOTAL NON-OPERATING REVENUES 3,870 5,501 1,631 42.1%
NON-OPERATING EXPENSES
Financing 3 3 0 0.0%
Interest 0 0 0 -
TOTAL NON-OPERATING EXPENSES 3 3 0 0.0%
TOTAL NON-OPERATING INCOME
(EXPENSES) 3,867 5,498 1,631 42.2%
CHANGE IN NET POSITION 107,830 21,917 (85,913) -79.7%
CAPITAL EXPENDITURES, INTERFUND
TRANSFERS & OTHER
Capital Outlay 200 50 (150) -75.0%
Transfer to CRCR Fund 0 0 0 -
Program Fund 9,765 8,874 (891) -9.1%
Nuclear Allocation 1,900 2,188 288 15.2%
Multi Family Direct Install Program 9,500 0 (9,500) -100.0% Electrification Discount Program 9,500 0 (9,500) 0.0%
Customer Bill Relief 3,600 3,136 (464) -12.9%
TOTAL CAPITAL EXPENDITURES, INTERFUND
TRANSFERS & OTHER $34,465 $14,248 ($20,217) -58.7%
BALANCE AVAILABLE FOR RESERVES $73,365 $7,669 ($65,696) -89.5% Year over Year
Change
Item 4
Attachment 1
Attachment 2
($ in Thousands)
FY22-23 FY23-24 FY24-25 FY25-26 FY26-27 FY27-28
Operating Revenue (Adjusted Budget) (Budget) (Forecast) (Forecast) (Forecast) (Forecast) Electricity Sales, Net1
$ 531,561 $ 435,206 $ 471,956 $ 503,130 $ 515,879 $ 517,916 GreenPrime Electricity Premium 1,055 2,012 2,322 2,334 2,351 2,371 Total Operating Revenues 532,616 437,218 474,278 505,464 518,230 520,287 Operating Expense
Power Supply $ 391,261 $ 391,624 $ 400,877 $ 416,343 $ 450,677 $ 439,648 Operating Margin 141,355 45,594 73,401 89,122 67,553 80,639 Data Management 3,413 3,413 3,583 3,762 3,950 4,148
PG&E Service Fees 1,470 1,470 1,544 1,621 1,702 1,787
Staff Compensation 11,285 15,406 16,176 16,985 17,834 18,726 Consultants and other Professional Fees 8,016 8,084 8,570 9,084 9,629 10,206 Communications and Noticing 993 1,370 1,439 1,511 1,586 1,666 General and Administration 2,382 2,618 2,749 2,886 3,031 3,182 Transfers to Programs Fund 34,265 11,062 9,486 10,109 10,365 10,406 Total Operating Expenses 453,085 435,047 444,422 462,300 498,773 489,769 Operating Income 79,531 2,171 29,856 43,164 19,457 30,518 Nonoperating Revenue (Expense)
Other Income 182 50 51 51 52 52
Investment Income - 5,501 5,251 5,683 6,389 6,635
Capital Outlay & Financing Costs (200) (53) (53) (53) (53) (53) Grant Income - - - - - -
Total Non-Operating Revenue (Expense) (18) 5,498 5,249 5,681 6,387 6,634 Change in Net Position/Available for Reserves 79,513 7,669 35,104 48,845 25,844 37,152 Begin, Net Position 212,684 320,082 307,579 329,143 364,448 376,752 Adjustment for Program Expenditure2
27,886 (20,173) (13,540) (13,540) (13,540) 0
End, Net Position $ 320,082 $ 307,579 $ 329,143 $ 364,448 $ 376,752 $ 413,904
Days Cash On Hand (DCOH) at Year End $ 297,561 $ 285,058 $ 306,622 $ 341,927 $ 354,230 $ 391,383 Days of cash on hand 255 229 244 262 252 292
Each year the Board transfers funds from the Operating Budget to the Decarboniztion Programs Fund as shown in the above forecast u nder line item Transfers to Programs Fund. The line item Adjustment for Program Expenditure accounts for the difference between forecasted spend for programs versus the amount transfered to the fund. This adjustment is needed because program spending to date has been less than the amount transferred to the programs fund.
Assumptions: 4% overall discount relative to comparable PG&E rates for Oct-Dec 2023 and 1% for Jan-Sept 2024. FY 23-24 includes additional bill credit to low income customers totaling $3.14 million (1% of Jan-Sept 2024 Revenue). 1% discount for FY24-25, FY25-26, FY26-27 and FY27-28.
Item 4
Attachment 2
1 2
FP9
Category: FINANCE
Page | 1 Amended: 9/14/2022
Proposed Amendment: 8/09/2023
FINANCIAL RESERVES
POLICY
I. PURPOSE
This Reserve Policy outlines the appropriate types and levels (minimum, goal, and maximum) of financial reserves as prescribed in the following policy. The primary reason for a reserve policy is to be prepared for contingencies, but other reasons also exist. Seven important purposes of a reserve policy are as follow:
1. Plan for contingencies. To maintain sufficient reserves to minimize rate increase due to market volatility(power supply shocks or maintain rate competitiveness), weather impacts on demands, economic downturns, emergencies
(such as natural disasters), and regulatory changes.
2. Maintain good standing with rating agencies. By
maintaining sufficient reserves, SVCE can preserve good credit ratings, allowing it to secure power at lower costs, that is, without posting credit enhancements, in the energy markets.
3. Avoid interest expense. To avoid interest expense to cover short-term cash shortfalls by having sufficient
reserves to use for this purpose, rather than debt.
4. Ensure cash availability when revenue is unavailable.
To bridge times of the year that normally see temporary low levels of cash.
5. Plan for anticipated future rate increases by gradually raising those rates, using reserves to cushion the full impact on customers over an extended time period. For
example, if it is expected that rates are highly likely to increase in 3 to 5 years, higher reserves on hand can cushion those rate increases over a more gradual timeframe by
drawing down on the accumulated funds that may be in
excess of the reserves’ goal.
6. Manage the risks identified in the Energy Risk
Management Policy, which are:
Item 4
Attachment 3
SILICON VALLEY \3/ CLEAN ENERGY
FP9
Category: FINANCE
Page | 2 Amended: 9/14/2022
Proposed Amendment: 8/09/2023
• Market price risk,
• Net revenue risk,
• Counterparty credit and performance risk,
• Load and generation volumetric risk,
• Operational risk,
• Liquidity risk, and
• Regulatory/legislative risk.
7. Establish clear expectations between the Board of
Directors and staff. A formal reserve policy creates a
shared understanding of the proper level and use of reserves.
II. POLICY
Reserve Levels Established
Financial reserves shall be set aside as follows:
The Reserve targets cover the operations of SVCE over a number of days in the event of emergencies or other significant unforeseen events. Three levels are defined, with the first being baseline. Given the purposes stated above, the Reserve shall be maintained at no less than the minimum described in (a) below. The reserve level described in (b) is recommended as the goal. The Maximum reserve level described in (c) would provide solid reserves for significant fluctuations in revenue or unforeseen circumstances. The Board shall review its reserve levels annually in context of SVCE’s overall financial condition of the agency, as well as due to changes to the industry and/or risk factors as described in periodic review of targets below.
(a) Minimum Operating Reserve (baseline) shall be the minimum maintained to cover 120 days of operations of the annual operating budget;
(b) An Operating Reserve goal of covering 285300 days of operations of the annual operating budget;
(c) Maximum Operating Reserve to cover 490 days of operations of the annual operating budget.
Item 4
Attachment 3
SILICON VALLEY \3/ CLEAN ENERGY
FP9
Category: FINANCE
Page | 3 Amended: 9/14/2022
Proposed Amendment: 8/09/2023
Conditions for Use of Reserves
For purposes of this policy, use of reserves is defined as a projected or estimated1reduction in reserves by fiscal year-end. A temporary reduction in cash consistent with the expected peaks or dips in revenues and expenditures are normal cyclical occurrences to be expected during the fiscal year, and do not constitute a use of reserves.
The reserves may be drawn down upon by the CEO during the year, up to the lesser of 10% of the year’s budgeted cost of power supply, or $30 million, to:
1. Cover increases in power supply expenses due to spikes in costs and/or due to higher customer demand;
2. Provide necessary funds to make up for unanticipated revenue shortfalls;
3. Meet any margin or collateral posting requirements under energy supply contracts; and,
4. Provide resources to meet emergency expenditures.
If further use of reserves are needed to manage the operations of the organization, or if the use of reserves would bring the balance below the Minimum Operating Reserve baseline, the CEO must present recommendations to the Board and the Board must authorize any such use.
Replenishment of Reserves
Should SVCE drawdown reserves below the Minimum Operating Reserve level, SVCE will implement plans to return reserves to their minimum targets within two (2) fiscal years. Such plans will be provided in subsequent budget and rate discussions with the Board. 1 It is not practical to wait the formal fiscal year end closing of the accounting records to determine if the reserves have been “used”. Therefore, it is appropriate for staff to estimate reserve levels, with the important amount being what is estimated for fiscal year end.
Item 4
Attachment 3
SILICON VALLEY \3/ CLEAN ENERGY
FP9
Category: FINANCE
Page | 4 Amended: 9/14/2022
Proposed Amendment: 8/09/2023
Excess Reserves
If reserve funds are projected to exceed the maximum level, the CEO shall present options for consideration by the Board of Directors for proper disposition of those reserves during the next budget cycle.
Reserves between Minimum and Maximum
To the extent that reserves are above target and below the maximum, no other action by SVCE would be required.
Periodic Review of Reserve Goals
Reserve goals shall be periodically reviewed for consistency with industry standards. If significant risk factors are eliminated or significant new risks emerge as a result of changes in the industry, legislation, or economic conditions, the basis of the reserve policy shall be reviewed, and the funding level shall be adjusted accordingly.
Unless the Reserves are approaching minimum levels, formal Reserve funding discussions with the Board may await the next budget process.
Reporting
Reserve levels will be monitored during the fiscal year and reported in the quarterly financial reports. Reserve target levels (minimum and maximum) will be analyzed annually, and over/under reserve determination shall be made in conjunction with year-end financial results. These results will be reported to the Board of Directors as part of the year-end financial report presentation.
Item 4
Attachment 3
SILICON VALLEY \3/ CLEAN ENERGY
Appendix A
Silicon Valley Clean Energy
Board of Directors Meeting
August 9, 2023
Appendix A
Power Resource Contracts Executed by CEO
SILICON VALLEY
CLEAN ENERGY
LONG FORM CONFIRMATION
FOR RESOURCE ADEQUACY CAPACITY PRODUCT
Resource Adequacy Contract Number: SDGE_SVCEA_AUG-SEP 2023_SELL_SYS_FLEX This confirmation letter (“Confirmation”) confirms the transaction (the “Transaction”) between San Diego Gas & Electric Company (“Seller”) and Silicon Valley Clean Energy Authority (“Buyer”), each individually a “Party” and together the “Parties”, dated as of June 6, 2023 (the “Confirmation Execution Date”) in which Seller agrees to provide to Buyer the right to the Product, as such term is defined in Section 3 of this Confirmation. This Transaction shall be deemed to have been entered into pursuant to, and shall supplement, form a part of, and be governed by the terms and conditions of the form of Master Power Purchase and Sale Agreement published by the Edison Electric Institute and the National Energy Marketers Association (version 2.1 dated 4/25/00) (the “EEI Agreement”) with a Cover Sheet containing the elections and other changes contained herein as if the Parties have executed the EEI Agreement (with such Cover Sheet the “Master Agreement”). The Parties agree that the only transactions to be concluded pursuant to such Master Agreement shall be the Transaction documented in this Confirmation. 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). To the extent that this Confirmation is inconsistent with any provision of the Master Agreement, this Confirmation shall govern the rights and obligations of the Parties hereunder.
Name: Party A / Seller Name: Party B / Silicon Valley Clean Energy Authority
DocuSign Envelope ID: 70BA3A54-C737-4A46-B864-16B74A0AEA95 DocuSign Envelope ID: 78EF4FD2-703D-4787-A7C7-17FC22551E57 DocuSign Envelope ID: 51601FB4-E10F-4BD4-AA46-4C52B9331E42 Appendix A SDG&E
The Parties hereby agree that the General Terms and Conditions are incorporated herein, and to the following provisions as provided for in the General Terms and Conditions:
Article Two
Transaction Terms
and Conditions
Optional provision in Section 2.4.
If not checked, inapplicable.
DocuSign Envelope ID: 70BA3A54-C737-4A46-B864-16B74A0AEA95 DocuSign Envelope ID: 78EF4FD2-703D-4787-A7C7-17FC22551E57 DocuSign Envelope ID: 51601FB4-E10F-4BD4-AA46-4C52B9331E42 Appendix A SDG&E
Article Four
Remedies for Failure
to Deliver or Receive
Accelerated Payment of Damages.
If not checked, inapplicable.
Article Five Cross Default for Party A:
Events of Default; Remedies Party A: N/A Cross Default Amount: N/A Other Entity: N/A Cross Default Amount: N/A
Cross Default for Party B:
Party B: N/A Cross Default Amount: N/A
Other Entity: N/A Cross Default Amount: N/A
5.6 Closeout Setoff
Option A (Applicable if no other selection is made.)
Option B – Affiliates shall have the meaning set forth in the Agreement unless otherwise specified as follows:
___________________________________________
Option C (No Setoff)
Article 8 8.1 Party A Credit Protection:
Credit and
Collateral Requirements
(a) Financial Information:
Option A
Option B Specify: __________________________
Option C Specify: __________________________
(b) Credit Assurances:
Not Applicable
Applicable
(c) Collateral Threshold:
Not Applicable
Applicable
(d) Downgrade Event:
Not Applicable
Applicable
(e) Guarantor for Party B: N/A
Guarantee Amount: N/A
8.2 Party B Credit Protection
(a) Financial Information:
Option A
Option B Specify: __________________________
Option C Specify: __________________________
(b) Credit Assurances:
Not Applicable
Applicable
(c) Collateral Threshold:
Not Applicable
Applicable
If applicable, complete the following:
DocuSign Envelope ID: 70BA3A54-C737-4A46-B864-16B74A0AEA95 DocuSign Envelope ID: 78EF4FD2-703D-4787-A7C7-17FC22551E57 DocuSign Envelope ID: 51601FB4-E10F-4BD4-AA46-4C52B9331E42 Appendix A SDG&E
Party A Collateral Threshold: $______________;
provided, however, that Party A’s Collateral
Threshold shall be zero if an Event of Default or
Potential Event of Default with respect to Party A
has occurred and is continuing.
Party A Independent Amount: $______________
Party A Rounding Amount: $________________
(d) Downgrade Event:
Not Applicable
Applicable
If applicable, complete the following:
It shall be a Downgrade Event for Party A if
Party A ‘s Credit Rating falls below _______
from S&P or _______ from Moody’s or if Party A
is not rated by either S&P or Moody’s
Other:
Specify: _______________________________
(e) Guarantor for Party A: N/A
Guarantee Amount: N/A
Article 10
Confidentiality Confidentiality Applicable If not checked, inapplicable.
Schedule M Party A is a Governmental Entity or Public Power System Party B is a Governmental Entity or Public Power System Add Section 3.6. If not checked, inapplicable
Add Section 8.4. If not checked, inapplicable
Note to Buyers: If Buyer is a form of governmental entity, then Schedule M shall apply and further modifications to this Confirm will be needed.
Other Changes 1. The modifications to Section 1.12, 1.50 and 5.2 of the Master Agreement specified in that certain Errata
published by the Edison Electric Institute (version 1.1, July 18, 2007) are hereby incorporated herein as if set forth in full.
2. Section 1.60 is amended by inserting the words “in writing” immediately following the words “agreed to”.
3. In Section 2.1, delete the first sentence in its entirety and replace with the following:
“A Transaction, or an amendment, modification or
supplement thereto, shall be entered into only upon a
writing signed by both Parties evidencing the
DocuSign Envelope ID: 70BA3A54-C737-4A46-B864-16B74A0AEA95 DocuSign Envelope ID: 78EF4FD2-703D-4787-A7C7-17FC22551E57 DocuSign Envelope ID: 51601FB4-E10F-4BD4-AA46-4C52B9331E42 Appendix A SDG&E
commercial terms of such Transaction (a
“Confirmation”).”
4. Section 2.3 is deleted in its entirety and replaced with the following:
“2.3 No Oral Agreements or Modifications.
Notwithstanding anything to the contrary in this Master Agreement, the Master Agreement and any and all
Transactions may not be orally amended,
supplemented or modified and any such amendment,
supplement or modification shall only be effective
pursuant to a writing signed by both Parties.”
5. Section 2.4 is hereby amended by deleting the words
“either orally or” in the sixth line.
6. Section 10.2(ii) of the Master Agreement shall be modified by inserting “Except for the approval by the CPUC as
stated in Section 2.2 of this Confirmation,” at the
beginning of the first sentence in such section.
7. Section 10.6 of the Master Agreement shall be deleted in its entirety and replaced with the following:
“10.6 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 PERMISSIBLE UNDER
APPLICABLE LAW, EACH PARTY WAIVES ITS
RESPECTIVE RIGH TO ANY JURY TRIAL WITH
RESPECT TO ANY LITIGATION ARISING UNDER OR
IN CONNECTION WITH THIS AGREEMENT.”
8. Schedule P: Products and Related Definitions shall be deleted in its entirety.
1. Definitions
1.1 “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.
1.2 “Availability Incentive Payments” has the meaning set forth in the Tariff and includes any similarly defined payments under the Tariff in respect of Flexible RA Attributes.
1.3 “Availability Standards” has the meaning set forth in the Tariff and includes any similarly defined standards under the Tariff in respect of Flexible RA Attributes.
DocuSign Envelope ID: 70BA3A54-C737-4A46-B864-16B74A0AEA95 DocuSign Envelope ID: 78EF4FD2-703D-4787-A7C7-17FC22551E57 DocuSign Envelope ID: 51601FB4-E10F-4BD4-AA46-4C52B9331E42 Appendix A SDG&E
1.4 “Buyer” has the meaning specified in the introductory paragraph.
1.5 “CAISO” means the California Independent System Operator Corporation, or any successor entity performing the same functions.
1.6 “Capacity Attributes” means (a) the Local RA Attributes, (b) the RA Attributes, (c) the Flexible RA Attributes, and (d) any other current or future defined characteristics (including the ability to generate at a given capacity level, provide ancillary services, ramp up or down at a given rate, and flexibility or dispatch-ability attributes), certificates, tags, credits, howsoever entitled, including any account construct applied to any Compliance Obligations, based on the applicable Unit’s electric generation capacity.
1.7 “Capacity Price” means the price specified in the Capacity Price Table in Section 4.1.
1.8 “Capacity Replacement Price” means (a) the actual rate per kW-day paid for any Replacement Capacity purchased by Buyer pursuant to Section 5.2(a) including any penalties, fines, transaction costs and expenses reasonably incurred by Buyer in purchasing such Replacement Capacity, or (b) absent a purchase of Replacement Capacity, any penalties, fines, transaction costs and expenses plus the per kW-day market price for the Product not delivered by Seller under this Confirmation. 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 the “Replacement Price” for this Transaction.
1.9 “Compliance Obligations” means the RAR, Local RAR, Flexible RAR, and other resource adequacy requirements associated with a generating unit’s Capacity Attributes established for LSEs by the CPUC pursuant to the CPUC Decisions, or by any other Governmental Body having jurisdiction.
1.10 “Compliance Showing” means one or more of the following: (a) Local RAR Showing, (b) RAR Showing, (c) Flexible RAR Showing, or (d) other Capacity Attributes compliance or advisory filing (or similar or successor showing or filing), in each case, that an LSE is required to make to the CPUC (and/or, to the extent authorized by the CPUC, to the CAISO), pursuant to the CPUC Decisions, or to any Governmental Body having jurisdiction.
1.11 “Confirmation” has the meaning specified in the introductory paragraph.
1.12 “Confirmation Execution Date” has the meaning specified in the introductory paragraph.
1.13 “Contract Price” means, for any day in any Monthly Delivery Period, the Capacity Price for such period.
1.14 “Contract Quantity” means the quantity of Product (in MW) as set forth in Section 3.5.
1.15 “Contract Term” has the meaning set forth in Section 2.1.
1.16 “CPUC” means the California Public Utilities Commission.
1.17 “CPUC Decisions” 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, 12-06-25, and any other existing or subsequent decisions, resolutions or rulings related to resource adequacy, as may be amended from time to time by the CPUC.
1.18 “CPUC Filing Guide” is the annual document issued by the CPUC which sets forth the guidelines, requirements and instructions for LSEs to demonstrate compliance with the CPUC’s resource adequacy program as provided in the CPUC Decisions.
1.19 “Credit Rating” means, with respect to any entity, the rating assigned to such entity’s unsecured, senior long-term debt obligations (not supported by third party credit enhancements) by S&P, Moody’s or any DocuSign Envelope ID: 70BA3A54-C737-4A46-B864-16B74A0AEA95 DocuSign Envelope ID: 78EF4FD2-703D-4787-A7C7-17FC22551E57 DocuSign Envelope ID: 51601FB4-E10F-4BD4-AA46-4C52B9331E42 Appendix A SDG&E
other rating agency agreed by the Parties as set forth in the Master Agreement, or if such entity does not have a rating for its senior unsecured long-term debt, then the rating then assigned to such entity as an issuer rating by S&P, Moody’s or any other rating agency agreed by the Parties as set forth in the Master Agreement.
1.20 “Delivery Period” has the meaning specified in Section 3.3.
1.21 “Emission Reduction Credits” or “ERC(s)” means emission reductions that have been authorized by a local air pollution control district pursuant to California Division 26 Air Resources; Health and Safety Code Sections 40709 and 40709.5, whereby such district has established a system by which all reductions in the emission of air contaminants that are to be used to offset certain future increases in the emission of air contaminants shall be banked prior to use to offset future increases in emissions.
1.22 “Environmental Costs” means costs incurred in connection with acquiring and maintaining all environmental permits and licenses for the Product, and 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, all operating and maintenance costs for operation of pollution mitigation or control equipment, costs of permit maintenance fees and emission fees as applicable, and the costs of all Emission Reduction Credits or Marketable Emission Trading Credits (including any costs related to greenhouse gas emissions) required by any applicable environmental laws, rules, regulations, and permits to operate, and costs associated with the disposal and clean-up of hazardous substances introduced to the site, and the decontamination or remediation, on or off the site, necessitated by the introduction of such hazardous substances on the site.
1.23 “Flexible RA Attributes” means, with respect to a Unit, any and all flexible resource adequacy attributes, as may be identified from time to time by the CPUC, CAISO or other Governmental Body having jurisdiction that can be counted toward Flexible RAR, exclusive of any RA Attributes and Local RA Attributes.
1.24 “Flexible RAR” means the flexible capacity requirements, including, without limitation, maximum continuous ramping, load following, and regulation, established for LSEs by the CPUC pursuant to the CPUC Decisions, or by any other Governmental Body having jurisdiction. Flexible RAR may also be known as ramping, maximum ramping, maximum continuous ramping, maximum continuous ramping capacity, maximum continuous ramping ramp rate, load following, load following capacity, load following ramp rate, regulation, regulation capacity, regulation ramp rate.
1.25 “Flexible RAR Showing” means the Flexible RAR compliance or advisory filing (or similar or successor showing or filing) 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 any Governmental Body having jurisdiction.
1.26 “GADS” means the Generating Availability Data System, or its successor.
1.27 “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.
1.28 “Local Capacity Area” has the meaning set forth in the Tariff.
1.29 “Local RA Attributes” means, with respect to a Unit, any and all resource adequacy attributes or other locational attributes for the Unit related to a Local Capacity Area, as may be identified from time to time by the CPUC, CAISO or other Governmental Body having jurisdiction, associated with the physical location or point of electrical interconnection of the Unit within the CAISO Control Area, that can be counted toward a Local RAR, but exclusive of any RA Attributes and Flexible RA Attributes.
DocuSign Envelope ID: 70BA3A54-C737-4A46-B864-16B74A0AEA95 DocuSign Envelope ID: 78EF4FD2-703D-4787-A7C7-17FC22551E57 DocuSign Envelope ID: 51601FB4-E10F-4BD4-AA46-4C52B9331E42 Appendix A SDG&E
1.30 “Local RAR” means the local resource adequacy requirements established for LSEs by the CPUC pursuant to the CPUC Decisions, or by any other Governmental Body having jurisdiction. Local RAR may also be known as local area reliability, local resource adequacy, local resource adequacy procurement requirements, or local capacity requirement in other regulatory proceedings or legislative actions.
1.31 “Local RAR Showing” means the Local RAR compliance or advisory filing (or similar or successor showing or filing) 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 any Governmental Body having jurisdiction.
1.32 “LSE” means load-serving entity.
1.33 “Marketable Emission Trading Credits” means without limitation, emissions trading credits or units pursuant to the requirements of California Division 26 Air Resources; Health & Safety Code Section 39616 and Section 40440.2 for market based incentive programs such as the South Coast Air Quality Management District’s Regional Clean Air Incentives Market, also known as RECLAIM, and allowances of sulfur dioxide trading credits as required under Title IV of the Federal Clean Air Act (see 42 U.S.C. § 7651b.(a) to (f)).
1.34 “Master Agreement” has the meaning specified in the introductory paragraph.
1.35 “Monthly Delivery Period” means each calendar month during the Delivery Period and shall correspond to each Showing Month.
1.36 “Monthly Payment” has the meaning specified in Section 4.1.
1.37 “Moody’s” means Moody’s Investors Services, Inc. or its successor.
1.38 “NERC” means the North American Electric Reliability Corporation, or its successor.
1.39 “NERC/GADS Protocols” means the GADS protocols established by NERC, as may be updated from time to time.
1.40 “Net Qualifying Capacity” has the meaning set forth in the Tariff.
1.41 “Non-Availability Charges” has the meaning set forth in the Tariff and includes any similarly defined charges under the Tariff in respect of Flexible RA Attributes.
1.42 “Non-Specified RA Replacement Capacity” has the meaning set forth in the Tariff and includes any similarly defined capacity under the Tariff in respect of Flexible RA Attributes.
1.43 “Outage” means any 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.
1.44 “Planned Outage” shall have the meaning in CPUC Decisions, and includes a planned, scheduled, or any other Outage approved by the CAISO for the routine repair or maintenance of the Unit, or for the purposes of new construction work, and does not include any Outage designated as either forced or unplanned as defined by the CAISO or NERC/GADS Protocols.
1.45 “Product” has the meaning specified in Section 3.1.
1.46 “Prorated Percentage of Unit Factor” means the percentage, as specified in Appendix A, of the Unit NQC as of the Confirmation Execution Date that is dedicated to Buyer under this Transaction.
1.47 “Prorated Percentage of Unit Flexible Factor” means the percentage, as specified in Appendix A, of the Unit EFC as of the Confirmation Execution Date that is dedicated to Buyer under this Transaction.
DocuSign Envelope ID: 70BA3A54-C737-4A46-B864-16B74A0AEA95 DocuSign Envelope ID: 78EF4FD2-703D-4787-A7C7-17FC22551E57 DocuSign Envelope ID: 51601FB4-E10F-4BD4-AA46-4C52B9331E42 Appendix A SDG&E
1.48 “RA Attributes” means, with respect to a Unit, any and all resource adequacy attributes, as may be identified from time to time by the CPUC, CAISO or other Governmental Body having jurisdiction that can be counted toward RAR, exclusive of any Local RA Attributes and Flexible RA Attributes.
1.49 “RA Substitute Capacity” means capacity that the CAISO permits under the CAISO Tariff to be substituted for a Resource Adequacy Resource that is on Outage.
1.50 “RAR” means the resource adequacy requirements established for LSEs by the CPUC pursuant to the CPUC Decisions, or by any other Governmental Body having jurisdiction.
1.51 “RAR Showing” means the RAR compliance or advisory filing (or similar or successor showing or filing) an LSE is required to make to the CPUC (and/or, to the extent authorized by the CPUC, to the CAISO), pursuant to the CPUC Decisions, or to any Governmental Body having jurisdiction.
1.52 “Replacement Capacity” means capacity which has equivalent Capacity Attributes as the portion of the Product not provided by the Units committed to Buyer as of the Confirmation Execution Date.
1.53 “Replacement Unit” means a generating unit providing Replacement Capacity.
1.54 “Resource Category” shall be as described in the CPUC Filing Guide.
1.55 “RMR Contract” has the meaning set forth in the Tariff.
1.56 “S&P” means the Standard & Poor’s Rating Group (a division of McGraw-Hill, Inc. or its successor).
1.57 “Scheduling Coordinator” or “SC” has the meaning set forth in the Tariff.
1.58 “Seller” has the meaning specified in the introductory paragraph.
1.59 “Showing Month” shall be the calendar month that is the subject of the Compliance Showing, as applicable, as set forth in the CPUC Decisions. For illustrative purposes only, pursuant to the CPUC Decisions in effect as of the Confirmation Execution Date, the monthly RAR Showing made in June is for the Showing Month of August.
1.60 “Substitution Rules” has the meaning set forth in Section 3.8(b).
1.61 “Supply Plan” has the meaning set forth in the Tariff and includes any similarly defined plan under the Tariff in respect of Flexible RA Attributes.
1.62 “Tariff” means the tariff and protocol provisions, including any applicable CAISO-published “Operating Procedures” and “Business Practice Manuals,” as amended or supplemented from time to time, of the CAISO.
1.63 “Transaction” has the meaning specified in the introductory paragraph.
1.64 “Unit” or “Units” shall mean the generation assets described in Appendix A (including any Replacement Units), from which Product is provided by Seller to Buyer.
1.65 “Unit Contract Quantity” means the amount of Product (in MW) to be delivered by Seller to Buyer by each individual Unit, as specified in Appendix A as of the Confirmation Execution Date.
1.66 “Unit EFC” means the effective flexible capacity or capacity that is qualified to provide Flexible RA Attributes established by the CAISO for the applicable Unit.
DocuSign Envelope ID: 70BA3A54-C737-4A46-B864-16B74A0AEA95 DocuSign Envelope ID: 78EF4FD2-703D-4787-A7C7-17FC22551E57 DocuSign Envelope ID: 51601FB4-E10F-4BD4-AA46-4C52B9331E42 Appendix A SDG&E
1.67 “Unit NQC” means the Net Qualifying Capacity established by the CAISO for the applicable Unit.
1.68 “Unit Delivered Quantity” means the amount of applicable Product (in MW) actually “delivered” by Seller to Buyer by each individual Unit. As used herein, “delivered” shall mean shown in the Supply Plan and, for purposes of Section 4.1, shall include any RA Substitute Capacity under Section 3.8, and in all cases, shall not include (i) any portion of Contract Capacity for which Buyer is required under the Compliance Obligations or the Tariff to procure Replacement Capacity, and (ii) any portion of Contract Capacity for which Seller is required hereunder, but fails, to provide Replacement Capacity to Buyer.
2. Term
2.1 Contract Term
The “Contract Term” shall mean the period of time commencing upon the Confirmation Execution Date and continuing until the later of (a) the expiration of the Delivery Period or (b) the date the Parties’ obligations under this Agreement have been fulfilled.
3. Transaction
3.1 Product
(a) Seller shall sell and Buyer shall receive and purchase, the Capacity Attributes (including all Local RA Attributes and Flexible RA Attributes) of the Units identified in Appendix A (collectively, the “Product”) and Seller shall deliver the Product as described in Section 3.2 below. Product does not include any right to dispatch or receive the energy or ancillary services from the Unit. Seller retains the right to sell any Product from a Unit in excess of its Unit Contract Quantity. (b) The Parties agree that (i) the Contract Price for the Product shall not change if the CAISO, CPUC or other Governmental Body (A) defines new or re-defines existing Local Capacity Areas which decreases or increases the amount of Local RA Attributes provided hereunder, or (B) defines new or re-defines existing Local Capacity Areas whereby the Units qualify for a Local Capacity Area and (ii) if the event in Section 3.1(b)(i)(B) occurs then the Product shall include such Local RA Attributes. (c) The Parties agree that (i) the Contract Price for the Product shall not change if the CAISO, CPUC or other Governmental Body defines new or re-defines existing Flexible RAR, Capacity Attributes related to Flexible RAR, or attributes of the Unit related to Flexible RAR, that results in a decrease or increase in the amount of Capacity Attributes related to Flexible RAR provided hereunder, and (ii) if the event in Section 3.1(c)(i) occurs then the Product shall include such Capacity Attributes related to Flexible RAR.
3.2 Unit Contingent Quantity
During the Delivery Period, Seller shall provide Buyer with the Product from the Unit(s) in the amount of the Contract Quantity. Except for reasons of Planned Outage, Force Majeure or any adjustment of the Capacity Attributes of any Unit(s), if the Unit(s) are not available to provide any portion of the Product, Seller shall provide Buyer with Replacement Capacity from one or more Replacement Units pursuant to Section 5.1.
If Seller fails to provide Buyer with Replacement Capacity pursuant to Section 5.1, then Seller shall be liable for damages and/or to indemnify Buyer for penalties, fines or costs pursuant to the terms of Section 5 and Section 10.
3.3 Delivery Period
The “Delivery Period” shall be August 1, 2023, through September 30, 2023, inclusive, unless terminated earlier in accordance with the terms of this Agreement.
DocuSign Envelope ID: 70BA3A54-C737-4A46-B864-16B74A0AEA95 DocuSign Envelope ID: 78EF4FD2-703D-4787-A7C7-17FC22551E57 DocuSign Envelope ID: 51601FB4-E10F-4BD4-AA46-4C52B9331E42 Appendix A SDG&E
3.4 Contract Quantity:
During each month of the Delivery Period, Seller shall provide the Product from each Unit in the total amount for such month as follows:
CONTRACT QUANTITY TABLE
Unit Name
CAISO
Resource ID* Month(s)
Unit Contract Quantity
(MW)
Capacity
Attributes
(excluding
Flexible RA
Attributes)
Flexible
RA
Attributes
* CAISO Resource ID should match a Unit described in Appendix A
3.5 Delivery of Product
Seller shall provide Buyer with the Contract Quantity for each day in each Monthly Delivery Period consistent with the following:
(a) Seller shall, on a timely basis, submit, or cause each Unit's SC to submit, Supply Plans to identify and confirm the Unit Delivered Quantity for each Unit provided to Buyer so that the total amount of Unit Delivered Quantity identified and confirmed equals the Unit Contract Quantity for each Unit, unless specifically notified or requested not to do so by the Buyer pursuant to Section 3.8, and; (b) Seller shall submit, or cause each Unit’s SC to submit, written notification to Buyer, no later than fifteen (15) Business Days before the relevant deadline for any applicable Compliance Showing, that Buyer will be credited with Unit Delivered Quantity for the applicable portion of the Delivery Period in the Unit’s SC Supply Plan so that the total amount of Unit Delivered Quantity for each Unit credited equals the Unit Contract Quantity.
3.6 CAISO/CPUC Offer Requirements
Subject to Buyer’s request under Section 3.8(a), Seller shall, or cause the Unit’s SC to, bid and/or schedule with, or make available to, the CAISO the Unit Contract Quantity for each Unit in compliance with the Tariff and the CPUC Filing Guide, including any must offer obligation under the Tariff or the CPUC Filing Guide, and shall, or cause the Unit’s SC, owner, or operator, as applicable, to perform all obligations under the Tariff and the CPUC Filing Guide that are associated with the sale and delivery of Product hereunder.
Buyer shall have no liability for the failure of Seller or the failure of any Unit’s SC, owner, or operator to comply with such Tariff and CPUC Filing Guide provisions, including any penalties, charges or fines imposed on Seller or the Unit’s SC, owner, or operator for such noncompliance.
3.7 Reserved
DocuSign Envelope ID: 70BA3A54-C737-4A46-B864-16B74A0AEA95 DocuSign Envelope ID: 78EF4FD2-703D-4787-A7C7-17FC22551E57 DocuSign Envelope ID: 51601FB4-E10F-4BD4-AA46-4C52B9331E42 Appendix A SDG&E
3.8 Unit Substitution; RA Replacement Capacity
(a) RA Replacement Capacity: No later than five (5) Business Days before the relevant deadline for each applicable Compliance Showing, Buyer may (i) request, subject to Seller’s reasonable approval, that Seller not, or cause each Unit’s SC not to, list a portion or all of a Unit’s applicable Unit Contract Quantity on the Supply Plan or (ii) notify Seller that a portion or all of the Unit Contract Quantity of a Unit will be included in an applicable Compliance Showing as RA Substitute Capacity.
The amount of Unit Contract Quantity that is the subject of such a request or notice shall be known as “RA Substitute Capacity” and, for purposes of calculating a Monthly Payment pursuant to Section
4.1, to the extent provided, such RA Substitute Capacity shall be deemed Unit Delivered Quantity provided consistent with Section 3.6.
(b) Seller’s Obligations With Respect to RA Substitute Capacity: If Buyer requests RA Substitute Capacity, Seller shall (i) make such RA Substitute Capacity available to Buyer during the applicable Showing Month to allow Buyer to utilize, as applicable, the substitution rules in Sections 9.3.1.3.1,
9.3.1.3.2 and 40.9.4.2.1 of the Tariff including any similarly defined substitution rules under the Tariff in respect of Flexible RA Attributes (“Substitution Rules”) and (ii) take, or cause each Unit’s SC to take, all action to allow Buyer to utilize, as applicable, the Substitution Rules, including, but not limited to, ensuring that the RA Substitute Capacity will qualify, as applicable, for substitution under the Substitution Rules, and providing Buyer with all information needed to utilize the Substitution Rules.
(c) Seller agrees that all RA Substitute Capacity utilized by Buyer under the Substitution Rules, as applicable, is subject to the requirements identified in Section 3.6. (d) Failure to Provide RA Substitute Capacity: If Seller fails to provide RA Substitute Capacity or Buyer is unable to utilize the RA Substitute Capacity under the Substitution Rules due to Seller’s failure to fulfill its obligations under Section 3.8(b)(ii), then Seller shall reimburse Buyer for any and all Non-Availability Charges incurred by Buyer and shall pay Buyer the CPM revenue the CAISO would have paid the Buyer but for Seller failure, due to such failure or inability to utilize the Substitution Rules; provided, that if Buyer is unable to utilize the Substitution Rules because the RA Substitute Capacity does not qualify for substitution under Section 9.3.1.3.1, 9.3.1.3.2, 40.9.4.2.1(1)(i) or (ii) of the Tariff, then Seller shall not be responsible for any such Non-Availability Charges described in this Section 3.8(d) associated with such inability.
3.9 Buyer’s Re-Sale of Product
Buyer may re-sell all or a portion of the Product.
4. Payment
4.1 Monthly Payment
In accordance with the terms of Article Six of the Master Agreement, Buyer shall make a “Monthly Payment” to Seller for each Unit after the applicable Monthly Delivery Period, as follows:
𝑀𝑜𝑛𝑡ℎ𝑙𝑦 𝑃𝑎𝑦𝑚𝑒𝑛𝑡 = ∑(𝐴𝑛 ∗ 𝐵𝑛 ∗ 1000)
𝑑
𝑛=1
DocuSign Envelope ID: 70BA3A54-C737-4A46-B864-16B74A0AEA95 DocuSign Envelope ID: 78EF4FD2-703D-4787-A7C7-17FC22551E57 DocuSign Envelope ID: 51601FB4-E10F-4BD4-AA46-4C52B9331E42 Appendix A SDG&E
where:
A = applicable Contract Price (in $/kW-day) for that calendar day B = Unit Delivered Quantity (in MW) for Capacity Attributes provided by Seller for such Unit in that calendar day; provided, however, in no event shall this quantity “B” exceed the Contract Quantity for such Unit (in MW) for Capacity Attributes nor shall this quantity “B” be less than zero. d = Total number of calendar days in the respective Monthly Delivery Period The Monthly Payment calculation shall be rounded to two decimal places. In no case shall a Unit's Monthly Payment (or any day in any Monthly Payment) be less than zero.
CAPACITY PRICE TABLE
Contract Month
Capacity Price
($/kW-day)
4.2 Reserved.
4.3 Allocation of Other Payments and Costs
(a) Seller shall retain any revenues it may receive from and pay all costs charged by, the CAISO or any other third party with respect to any Unit for (i) start-up, shutdown, and minimum load costs, (ii) capacity revenue for ancillary services, (iii) energy sales, and (iv) any revenues for black start or reactive power services. Seller shall be responsible for the Environmental Costs associated with the Product and shall indemnify, defend and hold Buyer harmless from and against all third-party claims brought against Buyer for Environmental Costs.
(b) Buyer shall be entitled to receive and retain all revenues associated with the Contract Quantity during the Delivery Period including any capacity or availability revenues from RMR Contracts for any Unit, Capacity Procurement Mechanism (CPM) or its successor, and Residual Unit Commitment (RUC) Availability Payments or Reliability Capacity, or their successor, and Imbalance Reserves or its successor but excluding payments described in Section 4.3(a)(i)-(iv). (c) In accordance with Section 4.1 of this Confirmation and Article Six of the Master Agreement, all such Buyer revenues described in Section 4.3(b), but received by Seller, or a Unit’s SC, owner, or operator shall be remitted to Buyer, and Seller shall pay such revenues to Buyer if the Unit’s SC, owner, or operator fails to remit those revenues to Buyer. In order to verify the accuracy of such revenues, Buyer shall have the right, at its sole expense and during normal working hours after reasonable prior notice, to hire an independent third party reasonably acceptable to Seller to audit any documents, records or data of Seller associated with the Contract Quantity.
DocuSign Envelope ID: 70BA3A54-C737-4A46-B864-16B74A0AEA95 DocuSign Envelope ID: 78EF4FD2-703D-4787-A7C7-17FC22551E57 DocuSign Envelope ID: 51601FB4-E10F-4BD4-AA46-4C52B9331E42 Appendix A SDG&E
(d) If a centralized capacity market develops within the CAISO region, Buyer will have exclusive rights to offer, bid, or otherwise submit the Contract Quantity for re-sale in such market, and retain and receive any and all related revenues.
(e) Subject to the Unit being made available to the CAISO in accordance with Article 3 of this Confirmation, Seller agrees that the Unit is subject to the terms of the Availability Standards, Non-Availability Charges, and Availability Incentive Payments under the Tariff. Furthermore, the Parties agree that any Availability Incentive Payments are for the benefit of Seller and for Seller’s account and that any Non-Availability Charges are the responsibility of Seller and for Seller’s account.
4.4 Offset Rights
Either Party may offset any amounts owing to it for revenues, penalties, fines, costs, reimbursement or other payments pursuant to Article Six of the Master Agreement against any future amounts it may owe to the other Party under this Confirmation.
5. Seller's Failure to Deliver Contract Quantity
5.1 Seller’s Duty to Provide Replacement Capacity
Planned Outage replacement shall be addressed by the Tariff. For all other replacements, if Seller is unable to provide the Contract Quantity from any Unit(s) for any day in any Monthly Delivery Period and Replacement Capacity is required under Section 3.2, then:
(a) Seller shall notify Buyer of the non-availability of any portion of the Contract Quantity from any Unit(s) and identify Replacement Unit(s), and
(b) Seller shall, at no additional cost to Buyer, provide Buyer with Replacement Capacity from one or more Replacement Units, such that the total amount of Product provided to Buyer from all Units and Replacement Units equals Contract Quantity.
provided that the designation of any Replacement Unit by Seller shall be subject to Buyer’s prior written approval, which shall not be unreasonably withheld or delayed. Once Seller has identified in writing any Replacement Units that meet the requirements of this Section 5.1, and Buyer has approved the designation of the Replacement Unit, then any such Replacement Unit shall be deemed a Unit for purposes of this Confirmation for that day in such Monthly Delivery Period. Notwithstanding anything to the contrary in this Confirmation, Seller’s failure to properly provide Replacement Capacity, including Seller’s obligation to identify Replacement Units within the notice deadlines specified in this Section 5.1, may result in the calculation of damages payable to Buyer and/or the indemnification of Buyer against any penalties, fines or costs under Section 5 and Section 10.
5.2 Damages for Failure to Provide Replacement Capacity If Seller fails to provide Buyer any portion of the Contract Capacity from Replacement Units for any day in any Monthly Delivery Period as required by Section 5.1, then the following shall apply:
(a) Buyer may, but shall not be obligated to, obtain Replacement Capacity. Buyer may enter into purchase transactions with one or more parties to replace the portion of Contract Capacity not provided by Seller. Additionally, Buyer may enter into one or more arrangements to repurchase its obligation to sell and deliver the capacity to another party, and such arrangements shall be considered the procurement of Replacement Capacity. Buyer shall act in a commercially reasonable manner in purchasing any Replacement Capacity, and; DocuSign Envelope ID: 70BA3A54-C737-4A46-B864-16B74A0AEA95 DocuSign Envelope ID: 78EF4FD2-703D-4787-A7C7-17FC22551E57 DocuSign Envelope ID: 51601FB4-E10F-4BD4-AA46-4C52B9331E42 Appendix A SDG&E
(b) Seller shall pay to Buyer damages, in accordance with the terms of Section 4.1 of the Master Agreement relating to “Accelerated Payment of Damages,” if applicable, an amount equal to the positive difference, if any, between (i) the sum of (A) the Capacity Replacement Price paid by Buyer for any Replacement Capacity purchased by Buyer pursuant to Section 5.2(a) for such day, plus (B) the Capacity Replacement Price times the portion of Contract Capacity not provided by Seller nor purchased by Buyer pursuant to Section 5.2(a) for such day times 1,000 kW/MW, and (ii) the portion of Contract Capacity not provided for the applicable day in the applicable Monthly Delivery Period times the Contract Price for that day times 1,000 kW/MW.
5.3 Indemnities for Failure to Deliver Contract Capacity If Buyer is unable to purchase Replacement Capacity after Seller fails to provide Buyer a portion of the Contract Capacity from Replacement Units for any day in any Monthly Delivery Period as required by Section 5.1, then in addition to the damages pursuant to Section 5.2(b)(i)(B) with respect to the portion of Contract Capacity that Buyer has not replaced, Seller agrees to indemnify, defend and hold harmless Buyer from any penalties, fines or costs assessed against Buyer by the CPUC, CAISO, or any Governmental Body having jurisdiction, resulting from any of the following:
(a) Seller’s failure to provide any portion of the Contract Capacity or any portion of the Replacement Capacity;
(b) Seller’s failure to provide timely notice of the non-availability of any portion of the Contract Capacity; (c) A Unit’s SC’s failure to timely submit Supply Plans that identify Buyer’s right to the Unit Contract Quantity purchased hereunder, or;
(d) any other failure by Seller to perform its material obligations under this Confirmation.
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, fines and costs.
6. Other Buyer and Seller Covenants
6.1 Seller’s and Buyer’s Duty to Take Action to Allow the Utilization of the Product Buyer and Seller shall, throughout the Delivery Period, take commercially reasonable actions and execute any and all documents or instruments reasonably necessary to ensure Buyer's right to the use of the Contract Quantity for the sole benefit of Buyer's Compliance Obligations. The Parties further agree to negotiate in good faith to make necessary amendments, if any, to this Confirmation to conform this Transaction to subsequent clarifications, revisions or decisions rendered by the CPUC, FERC, or other Governmental Body having jurisdiction to administer Compliance Obligations, to maintain the benefits of the bargain struck by the Parties on the Confirmation Execution Date. The Parties acknowledge that the benefit of the bargain as stated in this Agreement attempts to reflect anticipated changes to the CAISO and CPUC Resource Adequacy rules as such rules have been proposed as of the Confirmation Execution Date.
As used in this Section 6.1, “commercially reasonable actions” or “good faith” shall not require the Seller, or the owner or operator of any Unit to undertake any capital improvements, facility enhancements, or the construction of new facilities.
6.2 Seller’s Represents, Warrants and Covenants
DocuSign Envelope ID: 70BA3A54-C737-4A46-B864-16B74A0AEA95 DocuSign Envelope ID: 78EF4FD2-703D-4787-A7C7-17FC22551E57 DocuSign Envelope ID: 51601FB4-E10F-4BD4-AA46-4C52B9331E42 Appendix A SDG&E
Seller represents, warrants and covenants to Buyer that, throughout the Delivery Period:
(a) Seller owns or has the exclusive right to the Product sold under this Confirmation from each Unit, and shall furnish Buyer, CAISO, CPUC 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 Compliance Obligations or analogous obligations in any CAISO or non-CAISO markets, other than pursuant to an RMR Contract between the CAISO and either Seller or the Unit’s owner or operator; (c) Each Unit is connected to the CAISO Controlled Grid, is within the CAISO Control Area, and is under the control of CAISO;
(d) Seller shall, and each Unit’s SC, owner and operator is obligated to, comply with Applicable Laws, including the Tariff, relating to the Product;
(e) If Seller is the owner of any Unit, the aggregation of all amounts of Capacity Attributes that Seller has sold, assigned or transferred for any Unit does not exceed the Unit NQC or Unit EFC, as applicable, for that Unit;
(f) Seller has notified the SC of each Unit that Seller has transferred the Unit Contract Quantity to Buyer, and the SC is obligated to deliver the Supply Plans in accordance with the Tariff fully reflecting such transfer;
(g) Seller has notified the SC of each Unit that Seller is obligated to cause each Unit’s SC to provide to Buyer, at least fifteen (15) Business Days before the relevant deadline for each Compliance Showing, the Unit Contract Quantity of each Unit that is to be submitted in the Supply Plan associated with this Agreement for the applicable period; (h) Seller has notified each Unit’s SC that Buyer is entitled to the revenues set forth in Section 4.3, and such SC is obligated to promptly deliver those revenues to Buyer, along with appropriate documentation supporting the amount of those revenues;
(i) In the event Seller has rights to the energy output of any Unit, and Seller or the Unit’s SC schedules energy from the Unit for export from the CAISO Control Area, or commits energy to another entity in a manner that could result in scheduling energy from the Unit for export from the CAISO Control Area, it shall do so only as allowed by, and in accordance with, Applicable Laws and such exports may, if allowed by the Tariff, be curtailed by the CAISO, and; (j) The owner or operator of each Unit is obligated to maintain and operate each Unit using Good Utility Practice and, if applicable, General Order 167 as outlined by the CPUC in the Enforcement of Maintenance and Operation Standards for Electric Generating Facilities Adopted May 6, 2004, and is obligated to abide by all Applicable Laws in operating such Unit; provided, that the owner or operator of any Unit is not required to undertake capital improvements, facility enhancements, or the construction of new facilities.
7. Confidentiality
Notwithstanding Section 10.11 of the Master Agreement, the Parties agree that Buyer and Seller may disclose this Agreement to the CPUC, CAISO and any Governmental Body, as required by Applicable Law, and Seller may disclose the transfer of the Contract Quantity under this Transaction to the SC of each Unit in order for such SC to timely submit accurate Supply Plans; provided, that each disclosing Party shall use reasonable efforts to limit, to the extent possible, the ability of any such applicable Governmental Body, CAISO, or SC to further disclose such information. In addition, in the event Buyer resells all or any portion of the Product, Buyer shall be permitted to DocuSign Envelope ID: 70BA3A54-C737-4A46-B864-16B74A0AEA95 DocuSign Envelope ID: 78EF4FD2-703D-4787-A7C7-17FC22551E57 DocuSign Envelope ID: 51601FB4-E10F-4BD4-AA46-4C52B9331E42 Appendix A SDG&E
disclose to the other party to such resale transaction all such information necessary to effect such resale transaction.
8. Counterparts
This Agreement may be executed in one or more counterparts each of which shall be deemed an original and all of which shall be deemed one and the same Agreement. Delivery of an executed counterpart of this Agreement by fax will be deemed as effective as delivery of an originally executed counterpart. Any Party delivering an executed counterpart of this Agreement by facsimile will also deliver an originally executed counterpart, but the failure of any Party to deliver an originally executed counterpart of this Agreement will not affect the validity or effectiveness of this Agreement.
9. Collateral Requirements
Within one (1) Business Day of the Confirmation Execution Date, to secure its obligations under this Confirmation, Buyer agrees to deliver cash or a Letter of Credit in substantially the same form as attached hereto as Appendix B in the amount of ( ) to Seller and maintain
such security in full force and effect until it is required to be returned in accordance with this Section 9. The security posted under this Section 9 shall not be deemed a limitation of Buyer’s damages. Seller shall return to Buyer any unused portion of this security after the following have occurred: (i) the Delivery Period has expired or terminated early; and (ii) all payment obligations of the Buyer arising under this Confirmation, including compensation for penalties, indemnification payments or other damages are paid in full (whether directly or indirectly such as through set-off or netting).
10. Declaration of an Early Termination Date and Calculation of Settlement Amounts Notwithstanding anything to the contrary, the Parties shall determine the Settlement Amount for this Transaction in accordance with Section 5.2 of the Master Agreement using the defined terms contained in this Confirmation as applicable. Furthermore, with respect to this Transaction only, the following language is to be added at the end of Section 5.2 of the EEI Agreement:
“If Buyer is the Non-Defaulting Party and Buyer reasonably expects to incur penalties, fines or costs from the CPUC, the CAISO, or any other Governmental Body having jurisdiction, because Buyer is not able to include the Contract Quantity in any applicable Compliance Showing due to the termination of the Transaction under the Master Agreement caused by Seller’s Event of Default and Buyer has not purchased Replacement Capacity for the applicable portion of the Contract Quantity, then Buyer may, in good faith, estimate as its Losses in respect of the Transaction the present value of the amount of those penalties, fines and costs on a $/kW-day basis subtracting the Contract Price (in $/kW-day) and include this estimate in its determination of the Settlement Amount, subject to accounting to Seller when those penalties, fines and costs are finally ascertained. The rights and obligations with respect to determining and paying any Settlement Amount or Termination Payment, and any dispute resolution provisions with respect thereto, shall survive the termination of this Transaction and shall continue until after those penalties or fines are finally ascertained.” [Signature page follows]
DocuSign Envelope ID: 70BA3A54-C737-4A46-B864-16B74A0AEA95 DocuSign Envelope ID: 78EF4FD2-703D-4787-A7C7-17FC22551E57 DocuSign Envelope ID: 51601FB4-E10F-4BD4-AA46-4C52B9331E42 Appendix A SDG&E
IN WITNESS WHEREOF, the Parties have caused this Confirmation to be duly executed as of the date first above written.
Silicon Valley Clean Energy Authority SAN DIEGO GAS & ELECTRIC COMPANY a California joint powers authority a California corporation By: ________________________________ By:_______________________________ Name:______________________________ Name:_____________________________ Title:________________________________ Title:______________________________ APPROVED as to legal form _____
DocuSign Envelope ID: 70BA3A54-C737-4A46-B864-16B74A0AEA95 Girish Balachandran
CEO
DocuSign Envelope ID: 78EF4FD2-703D-4787-A7C7-17FC22551E57 Market Analysis Manager
Joe Pasquito
DocuSign Envelope ID: 51601FB4-E10F-4BD4-AA46-4C52B9331E42 Appendix A SDG&E
5CA64B9AC4C24C3...
x DocuSigned by:
BB43C9758847486...
f
DS
APPENDIX A
Buyer SCID: LSVCE
Unit Information
Unit Resource Name Desert Star Energy Center
CAISO Resource ID MRCHNT_2_PL1X3
Unit SCID LSDGE
Unit NQC (MW) 349.25
Prorated Percentage of Unit
Factor
Aug23-2.58%
Sep23-4.29%
Unit EFC (MW) 169.25
Flexible Category 1
Prorated Percentage of Unit
Flexible Factor
Aug23-5.32%
Sep23-8.86%
Resource Type Combined Cycle
Resource Category
(MMC Bucket 1, 2, 3 or 4) 4
Path 26 (North or South) South
Local Capacity Area (if any, as
of Confirmation Execution Date) N/A
Deliverability restrictions, if any,
as described in most recent
CAISO deliverability
assessment
None
DocuSign Envelope ID: 70BA3A54-C737-4A46-B864-16B74A0AEA95 DocuSign Envelope ID: 78EF4FD2-703D-4787-A7C7-17FC22551E57 DocuSign Envelope ID: 51601FB4-E10F-4BD4-AA46-4C52B9331E42 Appendix A SDG&E
Run Hour Restrictions None
DocuSign Envelope ID: 70BA3A54-C737-4A46-B864-16B74A0AEA95 DocuSign Envelope ID: 78EF4FD2-703D-4787-A7C7-17FC22551E57 DocuSign Envelope ID: 51601FB4-E10F-4BD4-AA46-4C52B9331E42 Appendix A SDG&E
Appendix B
Form of Letter of Credit
LETTER OF CREDIT FORM
IRREVOCABLE STANDBY
LETTER OF CREDIT
Reference Number:
Transaction Date:
BENEFICIARY:
San Diego Gas & Electric Company
Ladies and Gentlemen:
(the “Bank”) hereby establishes this Irrevocable
Standby Letter of Credit (“Letter of Credit”) in favor of San Diego Gas & Electric Company, a California corporation (the “Beneficiary”), for the account of , a corporation (the “Applicant”), for the amount of XXX AND XX/100 Dollars($ ) (the “Available Amount”), effective immediately and expiring at 5:00 p.m., New York time, on the Expiration Date (as hereinafter defined).
This Letter of Credit shall be of no further force or effect upon the close of business on or, if such day is not a Business Day (as hereinafter defined), on the next preceding Business Day, unless extended in accordance with the terms of this Letter of Credit.
For the purposes hereof, “Business Day” shall mean any day on which commercial banks are not authorized or required to close in New York, New York.
Subject to the terms and conditions herein, funds under this Letter of Credit are available to the Beneficiary by presentation in compliance on or prior to 5:00 p.m. New York time, on or prior to the Expiration Date, of the following:
1. The original of this Letter of Credit and all amendments (or photocopy of the original for partial drawings); and
2. The Drawing Certificate issued in the form of Attachment A attached hereto and which forms an integral part hereof, duly completed and purportedly bearing the signature of an authorized representative of the Beneficiary.
Notwithstanding the foregoing, any drawing hereunder may be requested by transmitting the requisite documents as described above to the Bank by facsimile at or such other number as specified from time to time by the Bank or by electronic signature. The facsimile or electronic signature transmittal shall be deemed delivered when received. It is understood that drawings made by facsimile transmittal or electronic signature are deemed to be the operative instrument without the need of originally signed documents.
DocuSign Envelope ID: 70BA3A54-C737-4A46-B864-16B74A0AEA95 DocuSign Envelope ID: 78EF4FD2-703D-4787-A7C7-17FC22551E57 DocuSign Envelope ID: 51601FB4-E10F-4BD4-AA46-4C52B9331E42 Appendix A SDG&E
Partial drawing of funds shall be permitted under this Letter of Credit, and this Letter of Credit shall remain in full force and effect with respect to any continuing balance; provided that, the Available Amount shall be reduced by the amount of each such drawing.
This Letter of Credit is transferable in whole or in part.
Banking charges shall be the sole responsibility of the Applicant.
It is a condition of this Letter of Credit that it shall be deemed automatically extended without an amendment for a one year period beginning on the present expiry date hereof and upon each anniversary of such date, unless at least ninety (90) days prior to any such expiry date we have sent you written notice by regular and registered mail or courier service that we elect not to permit this Letter of Credit to be so extended beyond, and will expire on its then current expiry date. No presentation made under this Letter of Credit after such expiry date will be honored except as described in the succeeding paragraph.
We agree that if this Letter of Credit would otherwise expire during, or within 30 days after, an interruption of our business caused by an act of god, riot, civil commotion, insurrection, act of terrorism, war or any other cause beyond our control or by any strike or lockout, then this Letter of Credit shall expire on the 30th day following the day on which we resume our business after the cause of such interruption has been removed or eliminated and any drawing on this Letter of Credit which could properly have been made but for such interruption shall be permitted during such extended period.
This Letter of Credit sets forth in full our obligations and such obligations shall not in any way be modified, amended, amplified or limited by reference to any documents, instruments or agreements referred to herein, except only the attachment referred to herein; and any such reference shall not be deemed to incorporate by reference any document, instrument or agreement except for such attachment.
The Bank engages with the Beneficiary that Beneficiary’s drafts drawn under and in compliance with the terms of this Letter of Credit will be duly honored if presented to the Bank on or before the Expiration Date.
THIS LETTER OF CREDIT IS SUBJECT TO THE UNIFORM CUSTOMS AND PRACTICE FOR DOCUMENTARY CREDITS (2007 REVISION) INTERNATIONAL CHAMBER OF COMMERCE, PUBLICATION NO. 600 ("UCP''), EXCEPT TO THE EXTENT THAT THE TERMS HEREOF ARE
INCONSISTENT WITH THE PROVISIONS OF THE UCP, INCLUDING BUT NOT LIMITED TO ARTICLES 14(8) AND 36 OF THE UCP, IN WHICH CASE THE TERMS OF THIS LETTER OF CREDITSHALLGOVERN. MATTERSNOTCOVERED BYTHEUCPSHALLBEGOVERNED AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA.
AUTHORIZED SIGNATURE for Bank
By:
Title:
DocuSign Envelope ID: 70BA3A54-C737-4A46-B864-16B74A0AEA95 DocuSign Envelope ID: 78EF4FD2-703D-4787-A7C7-17FC22551E57 DocuSign Envelope ID: 51601FB4-E10F-4BD4-AA46-4C52B9331E42 Appendix A SDG&E
SDG&E RA Confirmation Template
ATTACHMENT A TO APPENDIX B
DRAWING CERTIFICATE TO [ISSUING BANK NAME]
IRREVOCABLE STANDBY LETTER OF CREDIT
Reference Number.
(Sample Text)
DRAWING CERTIFICATE
Bank
Bank Address
Subject: Irrevocable Standby Letter of Credit
Reference Number:
The undersigned , an authorized representative
of San Diego Gas & Electric Company (the “Beneficiary”), hereby certifies to [Issuing Bank Name] (the “Bank”), and
(the “Applicant”), with reference to
Irrevocable Standby Letter of Credit No. , dated
, (the “Letter of Credit”), issued by the Bank
in favor of the Beneficiary, as follows as of the date hereof:
1. The Beneficiary is entitled to draw under the Letter of Credit an amount equal to
$ , for the following reason(s) [check applicable provision]:
[ ]A. An Event of Default, as defined in the [INSERT] Agreement between Beneficiary and Applicant (the “Agreement”), with respect to the Applicant has occurred and is continuing or an amount is due and unpaid to Beneficiary by Applicant.
[ ]B. The Letter of Credit will expire in fewer than sixty (60) days from the date hereof, and Applicant has not provided to Beneficiary alternate Performance Assurance (as defined in the Agreement) acceptable to Beneficiary.
2. Based upon the foregoing, the Beneficiary hereby makes demand under the Letter of Credit for payment of U.S. DOLLARS AND /100ths (U.S.$ ), which amount
does not exceed (i) the amount set forth in paragraph 1 above, and (ii) the Available Amount under the Letter of Credit as of the date hereof.
3. Funds paid pursuant to the provisions of the Letter of Credit shall be wire-transferred to the Beneficiary in accordance with the following instructions:
DocuSign Envelope ID: 70BA3A54-C737-4A46-B864-16B74A0AEA95 DocuSign Envelope ID: 78EF4FD2-703D-4787-A7C7-17FC22551E57 DocuSign Envelope ID: 51601FB4-E10F-4BD4-AA46-4C52B9331E42 Appendix A SDG&E
1 WSPP RESOURCE ADEQUACY
CONFIRMATION LETTER
BETWEEN
HIGH DESERT POWER PROJECT, LLC
AND
SILICON VALLEY CLEAN ENERGY AUTHORITY
This confirmation letter (“Confirmation”) confirms the transaction between HIGH DESERT POWER PROJECT, LLC, a California limited liability company (“Seller”), and SILICON VALLEY CLEAN ENERGY AUTHORITY, a California joint powers authority (“Buyer”), each individually a “Party” and together the “Parties”, dated as of May 25, 2023 (the “Confirmation Effective Date”), in which Seller agrees to sell and deliver and Buyer agrees to purchase and receive the right to the Product, as such term is defined in Article 3 of this Confirmation (the “Transaction”). This Transaction is governed by the WSPP Agreement effective as of 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 shall 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 (as defined herein).
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 “Annual Supply Plan” has the meaning set forth in the Tariff.
1.3 “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.
1.4 “Availability Incentive Payments” has the meaning set forth in the Tariff.
1.5 “Availability Standards” shall mean Availability Standards as defined in Section 40.9 of the Tariff or otherwise applicable to CAISO.
1.6 “Buyer” as used herein shall have the same meaning as “Purchaser” under the WSPP Agreement.
1.7 “CAISO” means the California Independent System Operator or its successor.
1.8 “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. The Buyer shall determine such market prices in a commercially reasonable manner. For purposes of Sections 4 and 21.3(2) of the WSPP Agreement, “Capacity Replacement Price” shall be deemed to be the “Replacement Price.”
1.9 “CIRA Tool” means the CAISO Customer Interface for Resource Adequacy application, or its successor platform.
1.10 “Compliance Showings” means the Flexible RAR Showings, LAR Showings, and RAR Showings, as applicable to the Product.
1.11 “Confirmation” has the meaning specified in the introductory paragraph hereof.
1.12 “Confirmation Effective Date” has the meaning specified in the introductory paragraph hereof.
1.13 “Contingent Firm RA Product” has the meaning specified in Section 3.4 hereof.
1.14 “Contract Price” means, for any Monthly Delivery Period, the price specified under the RA Capacity Price Table in Section 4.9.
DocuSign Envelope ID: BA154A9F-8793-4CED-9D92-04175A51DC3A DocuSign Envelope ID: A1E8DFF0-C337-482A-B6B1-CEC53ADD7C62 Appendix A High Desert Power
2 1.15 “Contract Quantity” means, with respect to any particular Showing Month of the Delivery Period, the amount of Product (in MW) set forth in the “Contract Quantity (MW)” table in Section 4.3 which Seller has agreed to provide to Buyer from the Unit for such Showing Month.
1.16 “Control Area” has the meaning set forth in the Tariff.
1.17 “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, 15-06-063, 16-06-045, 17-06-027, 19-02-022 and 19-06-026, and subsequent decisions related to resource adequacy issued from time to time by the CPUC.
1.18 “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.
1.19 “Delivery Period” has the meaning specified in Section 4.1 hereof.
1.20 “Delivery Point” has the meaning specified in Section 4.2 hereof.
1.21 “Designated RA Capacity” shall be equal to, with respect to 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 (i) any reductions to Contract Quantity made in accordance with Section 4.4 with respect to which Seller has not elected to provide Alternate Capacity, and (ii) any reductions resulting from events described under an event described at Section B-3.9 of Service Schedule B in the WSPP Agreement that excuse Seller’s performance.
1.22 “Effective Flexible Capacity” means the flexible capacity of a resource that can be counted towards an LSE’s FCR obligation, as identified from time to time by the Tariff, the CPUC Decisions, LRA, or other Governmental Body having jurisdiction.
1.23 “FCR Attributes” means, with respect to a Unit, any and all FCR attributes that can be counted toward an LSE’s FCR, as they are identified from time to time by the CPUC Decisions, the Tariff, an LRA, or other Governmental Body having jurisdiction that can be counted toward FCR and are consistent with the operational limitations and physical characteristics of such Unit. For clarity, it should be understood that if the CAISO, LRA, or other Governmental Body, defines new or re-defines the FCR Attributes of a Unit, then such change will not result in a change in obligations or payments made pursuant to this Transaction.
1.24 “FCR Showings” means the 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.
1.25 “Firm RA Product” has the meaning specified in the Section 3.3 hereof.
1.26 “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.
1.27 “Flexible Capacity Requirements” or “FCR” means the flexible capacity requirements established for LSEs by the CPUC pursuant to the CPUC Decisions, or by an LRA or other Governmental Body having jurisdiction.
1.28 “Flexible RA Product” has the meaning specified in the Section 3.2 hereof.
1.29 “GADS” means the Generating Availability Data System or its successor.
1.30 “Generic RA Product” means Designated RA Capacity consisting of RAR Attributes and, if applicable, LAR Attributes, which does not include FCR Attributes.
1.31 “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.
DocuSign Envelope ID: BA154A9F-8793-4CED-9D92-04175A51DC3A DocuSign Envelope ID: A1E8DFF0-C337-482A-B6B1-CEC53ADD7C62 Appendix A High Desert Power
3 1.32 “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.
1.33 “LAR Attributes” means, with respect to a Unit, any and all resource adequacy attributes (or other locational attributes related to system reliability), as may be 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 the Unit within the CAISO Control Area, that can be counted toward LAR and are consistent with the operational limitations and physical characteristics of such Unit, but exclusive of any RAR 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 obligations or payments made pursuant to this Transaction.
1.34 “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.
1.35 “LRA” has the meaning set forth in the Tariff.
1.36 “LSE” means load-serving entity. LSEs may be an investor-owned utility, an electric service provider, a community aggregator or community choice aggregator, or a municipality serving load in the CAISO Control Area (excluding exports).
1.37 “Maximum Cumulative Capacity” or “MCC” shall have the meaning specified in Section 2.1 hereof.
1.38 “Monthly Delivery Period” means each calendar month during the Delivery Period and shall correspond to each Showing Month.
1.39 “Monthly RA Capacity Payment” has the meaning specified in Section 4.9 hereof.
1.40 “Monthly Supply Plan” has the meaning set forth in the Tariff.
1.41 “NERC” means the North American Electric Reliability Council, or its successor.
1.42 “NERC/GADS Protocols” means the GADS protocols established by NERC, as may be updated from time to time.
1.43 “Net Qualifying Capacity” has the meaning set forth in the Tariff.
1.44 “Non-Availability Charges” has the meaning set forth in the Tariff.
1.45 “Notification Deadline” means in respect of a Showing Month the day that is fifteen (15) Business Days before the Compliance Showing deadlines. For illustrative purposes only, as of the Confirmation Effective Date, the applicable Compliance Showing deadlines are as follows: (A) forty-five (45) days prior to the Showing Month covered by the Supply Plan for the Monthly Supply Plan; and (B) the last Business Day of October that is prior to commencement of the year for the Annual Supply Plan. The Parties acknowledge and agree that such dates may be modified by the CAISO or CPUC from time to time throughout the Delivery Period
1.46 “Outage” means 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).
1.47 “Planned Outage” means, subject to and as further described in the CPUC Decisions and the Tariff (Planned Outage referred to as “Approved Maintenance Outage” under 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, or for the purposes of new construction work for such Unit.
1.48 “Product” has the meaning specified in Article 3 hereof.
DocuSign Envelope ID: BA154A9F-8793-4CED-9D92-04175A51DC3A DocuSign Envelope ID: A1E8DFF0-C337-482A-B6B1-CEC53ADD7C62 Appendix A High Desert Power
4 1.49 “RA Capacity” means the qualifying and deliverable capacity of the Unit for RAR, 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 RAR Attributes, LAR Attributes and FCR Attributes of the capacity provided by a Unit, as applicable pursuant to this Confirmation.
1.50 “RA Capacity Price” means the price specified in the RA Capacity Price Table in Section 4.9 hereof.
1.51 “RAR” or “Resource Adequacy Requirements” means the resource adequacy requirements, exclusive of LAR and FCR, established for LSEs by the CPUC pursuant to the CPUC Decisions, by the CAISO under the Tariff, or by an LRA or other Governmental Body having jurisdiction.
1.52 “RAR Attributes” means, with respect to a Unit, any and all resource adequacy attributes, as may be identified from time to time by the Tariff, the CPUC Decisions, LRA, or any Governmental Body having jurisdiction, that can be counted toward RAR and are consistent with the operational limitations and physical characteristics of such Unit, exclusive of any LAR Attributes or FCR Attributes. If the CPUC adopts a Slice of Day reform, or another similar type of reform that results in a change in the RA capacity product, these additional attributes shall be included within the definition of “RAR Attributes”.
1.53 “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, the CPUC Decisions or LRA having jurisdiction.
1.54 “Replacement Capacity” has the meaning specified in Section 4.7 hereof.
1.55 “Replacement Unit” means a generating unit meeting the requirements specified in Section 4.5.
1.56 “Resource Adequacy Plan” has the meaning set forth in the Tariff.
1.57 “Resource Category” shall be as described in the CPUC Filing Guide, as such may be modified, amended, supplemented or updated from time to time.
1.58 “Scheduling Coordinator” or “SC” has the same meaning as in the Tariff.
1.59 “Seller” has the meaning specified in the introductory paragraph hereof.
1.60 “Showing Month” is the calendar month during the Delivery Period that is the subject of the Compliance Showing. For illustrative purposes only, pursuant to the CPUC Decisions in effect as of the Confirmation Effective Date, the monthly Compliance Showing made in June is for the Showing Month of August.
1.61 “Shown Unit” means a Unit, or any Replacement Unit meeting the requirements of Section 4.5 of this Confirmation from which RA Capacity will be provided by Seller to Buyer and that Seller identifies annually pursuant to Article 2.
1.62 “Subsequent Buyer” means the purchaser of Product from Buyer in a re-sale of Product by Buyer.
1.63 “Substitute Capacity” has the meaning set forth in the Tariff for “RA Substitute Capacity.”
1.64 “Supply Plan” has the meaning set forth in the Tariff.
1.65 “Tariff” means the tariff and protocol provisions of the CAISO, including associated rules, procedures and business practice manuals, as amended or supplemented from time to time.
1.66 “Transaction” has the meaning specified in the introductory paragraph hereof.
1.67 “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.
1.68 “Unit EFC” means the Effective Flexible Capacity set by the CAISO for the applicable Unit. If the CAISO adjusts the Effective Flexible Capacity of a Unit after the Confirmation Effective Date, then for the period in which the adjustment is effective, the Unit EFC shall be deemed the lesser of (i) the Unit EFC as of the Confirmation Effective Date, and (ii) the CAISO-adjusted Effective Flexible Capacity. To the extent the Confirmation Effective Date of this Confirmation occurs prior to the DocuSign Envelope ID: BA154A9F-8793-4CED-9D92-04175A51DC3A DocuSign Envelope ID: A1E8DFF0-C337-482A-B6B1-CEC53ADD7C62 Appendix A High Desert Power
5 CAISO’s setting of a Unit EFC for the applicable Unit, the Unit EFC shall be as agreed to by the Parties and specified in Article 2, and Seller represents that, to the best of its knowledge, this Unit EFC is consistent with the CAISO’s methodology for determining Unit EFC as of the Confirmation Effective Date. To the extent the CAISO creates new categories of flexible capacity during the term of this Transaction and a Unit can count toward such new categories of flexible capacity while operating consistent with the operational limitation and physical characteristics of such Unit, any and all such new categories of flexible capacity shall be deemed to be part of the Effective Flexible Capacity of that Unit. The above notwithstanding, to the extent the CAISO decides to reduce the applicable Unit EFC, Seller shall not be liable for any costs or damages related to such reduction and the Unit EFC shall be reduced per Section 4.4 of this Confirmation.
1.69 “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, and (ii) the CAISO-adjusted Net Qualifying Capacity.
2. UNIT DESIGNATION
2.1 Seller to Annually Designate Shown Unit
(a) On an annual basis during the term of this Transaction, Seller shall designate the Shown Unit(s) from which RA Capacity will be provided to Buyer for the following calendar year by providing Buyer with the specific Unit information contained in Appendix A by no later than the earlier of (i) October 1, or (ii) thirty (30) calendar days before the deadline for the year-ahead Compliance Showing. (b) The Shown Unit shall meet the Product characteristics and Contract Quantity specified in Sections 3 and 4 and the Resource Category requirements set forth in Section 2.1(c).
Under no circumstances shall the Shown Unit be a coal-fired generating facility. (c) The Shown Unit shall qualify as a Maximum Cumulative Capacity (“MCC”) Resource Category 4 resource, which is described in the CPUC’s 2022 Filing Guide as being able to run or operate in “All Hours (planned availability is unrestricted)” and which is available all 24 hours of each day.
(d) Nothing in this Section 2.1 shall be construed to limit the applicability of Sections 4.4 (Adjustment to Contract Quantity) or 4.5 (Alternate Capacity and Replacement Units) of this Confirmation.
(e) Seller’s designation of the Shown Unit each year shall not in any way (i) convert the Contingent Firm RA Product being sold under this Confirmation into Firm RA Product, or (ii) cause any change to the Monthly RA Capacity Payment.
3. RESOURCE ADEQUACY CAPACITY PRODUCT
During the Delivery Period, Seller shall provide to Buyer, pursuant to the terms of this Confirmation, the Contract Quantity of (i) RAR Attributes and, if applicable, LAR Attributes, and (ii) FCR Attributes, if Flexible RA Product is specified in Section 3.2, and the Contract Quantity shall be either a Firm RA Product or a Contingent Firm RA Product, as specified in either Section 3.3 or 3.4 (the “Product”). 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 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 DocuSign Envelope ID: BA154A9F-8793-4CED-9D92-04175A51DC3A DocuSign Envelope ID: A1E8DFF0-C337-482A-B6B1-CEC53ADD7C62 Appendix A High Desert Power
6 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 pursuant to the Tariff any RA Capacity from a Unit that is in excess of that Unit’s Contract Quantity and any RAR Attributes, LAR Attributes or FCR Attributes not otherwise transferred, conveyed, or sold to Buyer under this Confirmation.
3.1 RAR and LAR Attributes
Seller shall provide Buyer with the Designated RA Capacity of RAR Attributes and, if applicable, LAR Attributes from each Unit, as measured in MWs, in accordance with the terms and conditions of this Agreement.
3.2 Flexible RA Product
Seller shall provide Buyer with Designated RA Capacity of FCR Attributes from the Units in the amount of the applicable Contract Quantity.
3.3 Firm RA Product
Seller shall provide Buyer with Designated RA Capacity from the Units 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 an Uncontrollable Force, 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.
3.4 Contingent Firm RA Product
Seller shall provide Buyer with Product from the Unit in the amount of the applicable Contract Quantity; provided, however, that if, and to the extent that the Unit is not available to provide the full amount of the Contract Quantity due to any reduction in Contract Quantity in accordance with Section 4.4, Seller shall have the option to notify Buyer 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 4.5. If Seller fails to provide Buyer with the Designated RA Capacity from the Unit and has failed to supply Alternate Capacity to fulfill the remainder of the Designated RA Capacity during such period, Seller shall be liable for damages and/or required to indemnify Buyer for penalties or fines pursuant to the terms of Section 4.7 and 4.8.
4. DELIVERY AND PAYMENT
4.1 Delivery Period
.
4.2 Delivery Point
The Delivery Point for each Unit shall be the CAISO Control Area, and if applicable, the LAR region in which the Unit is electrically interconnected.
DocuSign Envelope ID: BA154A9F-8793-4CED-9D92-04175A51DC3A DocuSign Envelope ID: A1E8DFF0-C337-482A-B6B1-CEC53ADD7C62 Appendix A High Desert Power
7 4.3 Contract Quantity
The Contract Quantity of each Unit for each Monthly Delivery Period shall be:
Contract Quantity (MW)
Month/Year Contract Quantity (MW)
4.4 Adjustments to Contract Quantity
(a) Planned Outages: If Seller is providing Contingent Firm RA Product and is unable to provide the applicable Contract Quantity for a portion of a Showing Month due to a Planned Outage of the Unit, then Seller shall have the option, but not the obligation, upon written notice to Buyer by the Notification Deadline, to either (i) reduce the Contract Quantity in accordance with the Planned Outage for such portion of the Showing Month, provided such reduction is able to be reflected on the Supply Plans in accordance with the Tariff; or (ii) provide Alternate Capacity in accordance with Section 4.5 up to the Contract Quantity for the applicable portion of such Showing Month.
(b) Reductions in Unit NQC: If Product is both (i) Generic RA Product, and (ii) Contingent Firm RA Product specified under Section 3.4, then Seller’s obligation to deliver the applicable Contract Quantity for any Showing Month may also be reduced if the Unit experiences a reduction in Unit NQC after the Confirmation Effective Date as determined by the CAISO.
Seller’s potential reduction in Contract Quantity for each remaining Showing Month shall equal the product of (A) the applicable Showing Month Contract Quantity and (B) the total amount (in MW) Unit NQC was reduced since Confirmation Effective Date, divided by (C) Unit NQC as of the Confirmation Effective Date. If the Unit experiences such a reduction in Unit NQC, then Seller has the option, but not the obligation, subject to written notice to Buyer by the Notification Deadline, to provide the applicable Contract Quantity for such Showing Month from (x) the same Unit, provided the Unit has sufficient remaining and available Product and/or (y) from Replacement Units, provided, that in each case Seller provides and identifies such Replacement Units in accordance with Section 4.5. (c) Reductions in Unit EFC: If Product is both (i) Flexible RA Product specified under Section
3.2, and (ii) Contingent Firm RA Product specified under Section 3.4, then Seller’s obligation to deliver the applicable Contract Quantity of Product for any Showing Month may also be reduced if the Unit experiences a reduction in Unit EFC as determined by the CAISO. Seller’s potential reduction in Contract Quantity for each remaining Showing Month shall equal the product of (A) the applicable Showing Month Contract Quantity and (B) the total amount (in MW) Unit EFC was reduced since Confirmation Effective Date, divided by (C) Unit EFC as of the Confirmation Effective Date. If the Unit experiences such a reduction in Unit EFC, then Seller has the option, but not the obligation, to provide the applicable Contract Quantity for such Showing Month from (x) the same Unit, provided the Unit has sufficient remaining and available Product and/or (y) from Replacement Units, provided, that in each case Seller provides and identifies such Replacement Units in accordance with Section 4.5.
(d) UCAP: If during the Delivery Period the CAISO or the CPUC either replaces Unit NQC as the value utilized to measure the qualifying capacity of a Unit with a successor value such as unforced capacity (UCAP) or utilizes such successor value as a supplemental means of measuring the qualifying capacity of a Unit together with Unit NQC, Seller shall have the right, but not the obligation, to send written notice to Buyer of such change (“Notice of Successor Value”). Following receipt of such notice from Seller, the Parties shall negotiate DocuSign Envelope ID: BA154A9F-8793-4CED-9D92-04175A51DC3A DocuSign Envelope ID: A1E8DFF0-C337-482A-B6B1-CEC53ADD7C62 Appendix A High Desert Power
8 an amendment to this Confirmation so that from and after such replacement Seller shall convey to Buyer an amount of qualifying capacity of such Unit of (i) no less than the amount obtained by calculating the Buyer’s share of such qualifying capacity but (ii) no more than the Contract Quantity. Under such amendment, Seller’s pro-rata delivery obligation shall be equal to the product of (A) the Contract Quantity divided by the Unit NQC, multiplied by (B) the Unit’s overall qualifying capacity (in MW) as measured by such new method of measuring a Unit’s qualifying capacity).
4.5 Alternate Capacity and Replacement Units
(a) 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, or Seller desires to provide the Contract Quantity for any Showing Month from a different generating unit other than the Unit, then Seller may, at no cost to Buyer, 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 of its intent (i) not to provide or (ii) to provide Alternate Capacity and identify Replacement Units meeting the above requirements and the Resource Category requirements set forth in Section 2.1(c), 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 that Showing Month. (b) With respect to a Contingent Firm RA Product, if Seller does not provide Alternate Capacity in an amount equal to the Contract Quantity for that Showing Month, then Buyer may, but shall not be required to, purchase replacement Product. Seller shall not 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 if (i) the failure to deliver the full Contract Quantity is due to a reduction in Contract Quantity in accordance with Section 4.4 and (ii) Seller has notified Buyer, no later than the Notification Deadline, of Seller’s intent not to provide Alternate Capacity in an amount equal to the Contract Quantity of that Showing Month.
4.6 Delivery of Product
Seller shall provide Buyer with the Designated RA Capacity of Product for each Showing Month consistent with the following:
(a) Seller shall submit, or cause the Unit’s Scheduling Coordinator to submit, by the Notification Deadline (i) Monthly Supply Plans and (ii) Annual Supply Plans if the Confirmation Effective Date is prior to the year-ahead Compliance Showing deadline applicable for the Showing Months as specified in Section 4.1, in accordance with the Tariff, identifying and confirming the transfer of the Designated RA Capacity to Buyer for each Showing Month, unless Buyer specifically requests in writing that Seller not do so (it being understood that any Designated RA Capacity subject to such a request from Buyer will be deemed to have been provided to Buyer for all purposes under this Confirmation). (b) The Product is delivered and received when the CIRA Tool shows the Supply Plan accepted for the Product from the Unit by CAISO or Seller complies with Buyer’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) Buyer has elected to submit the Product from the 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 due solely to a Seller error, and are rejected by CAISO, or (ii) Seller fails to submit the volume of Designated RA Capacity for any Showing Month pursuant to this Confirmation. Buyer will have received the Contract DocuSign Envelope ID: BA154A9F-8793-4CED-9D92-04175A51DC3A DocuSign Envelope ID: A1E8DFF0-C337-482A-B6B1-CEC53ADD7C62 Appendix A High Desert Power
9 Quantity if (x) Seller’s Supply Plan is accepted by the CAISO for the applicable Showing Month, (y) Seller correctly submits the Supply Plan and the Supply Plan and/or Resource Adequacy Plan are not matched in the CIRA Tool due solely to a Buyer error or (z) Seller complies with Buyer’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 Buyer fails or chooses not to submit the Unit and the Product in its Resource Adequacy Plan with the CPUC or CAISO.
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 this Confirmation, then the following shall apply:
(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 RAR Attributes, LAR Attributes and/or FCR Attributes as the Designated RA Capacity not provided by Seller, provided, that, if any portion of the Designated RA Capacity that Buyer is seeking to replace is Designated RA Capacity having RAR Attributes and no LAR Attributes (such capacity shall also include FCR Attributes if this is a Flexible Capacity Product) and no such RAR capacity is available, then Buyer may replace such portion of the Designated RA Capacity with other capacity having RAR Attributes and LAR Attributes (as well as FCR Attributes if this is a Flexible Capacity Product) (“Replacement Capacity”). Such Replacement Capacity may be provided by CAISO to Buyer pursuant to the Tariff. Buyer may enter into purchase transactions with one or more parties to replace any portion of Designated RA Capacity not provided by Seller. 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 at the time set forth in Section 9 of the WSPP Agreement, the following damages in lieu of damages specified in Section 9, 21.3 and 22 of the WSPP Agreement: an amount equal to the positive difference, if any, between (i) the sum of (A) the actual cost paid by Buyer for any Replacement Capacity, plus (B) each Capacity Replacement Price (excluding amounts included in Section 4.7(a)) times the amount of the Designated RA Capacity neither provided by Seller nor purchased by Buyer pursuant to Section 4.7(a), and (ii) the Designated RA Capacity not provided for the applicable Showing Month times the Contract Price for that month. If Seller fails to pay these damages, then Buyer may offset those damages owed it against any future amounts it may owe to Seller under this Confirmation pursuant to the WSPP Agreement.
4.8 Indemnities for Failure to Deliver Contract Quantity Subject to any adjustments made pursuant to Section 4.4 and requests from Buyer pursuant to Section
4.6(b)(i), Seller agrees to indemnify, defend and hold harmless Buyer from any penalties, fines or costs assessed against Buyer by the CPUC or the CAISO, to the extent not otherwise paid by Seller to Buyer under Section 4.7(b), resulting from any of the following:
(a) Seller’s failure to provide any portion of the Designated RA Capacity; (b) Seller’s failure to provide notice of the non-availability of any portion of Designated RA Capacity as required under Sections 4.4 and 4.5;
DocuSign Envelope ID: BA154A9F-8793-4CED-9D92-04175A51DC3A DocuSign Envelope ID: A1E8DFF0-C337-482A-B6B1-CEC53ADD7C62 Appendix A High Desert Power
10 (c) A Unit Scheduling Coordinator’s failure to timely submit Supply Plans that identify Buyer’s right to the Designated RA Capacity purchased hereunder; or (d) A Unit Scheduling Coordinator’s failure to 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 offset those penalties, fines or costs against any future amounts it may owe to Seller under this Confirmation.
4.9 Monthly RA Capacity Payment
In accordance with the terms of Section 9 of the WSPP Agreement, Buyer shall make a Monthly RA Capacity Payment to Seller for each Unit, in arrears after the applicable Showing Month. Each Unit's Monthly RA Capacity Payment shall be equal to the product of (a) the applicable Contract Price for that Monthly Delivery Period, (b) the Designated RA Capacity actually delivered by Seller to Buyer for the Monthly Delivery Period, and (c) 1,000; 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 4.6 at the time of the CAISO filing for the respective Showing Month. The final product of this Monthly RA Capacity Payment calculation shall be rounded to the nearest penny (i.e., two decimal places). Seller shall deliver invoices to the address(es) specified herein; 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.
RA CAPACITY PRICE TABLE
Contract
Year/Month
RA Capacity Price
($/kW-month)
4.10 Allocation of Other Payments and Costs
Seller may retain any revenues it 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) capacity 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. However, Buyer shall be entitled to receive and retain all revenues associated with the Designated RA Capacity of any Unit during DocuSign Envelope ID: BA154A9F-8793-4CED-9D92-04175A51DC3A DocuSign Envelope ID: A1E8DFF0-C337-482A-B6B1-CEC53ADD7C62 Appendix A High Desert Power
11 the Delivery Period (including any capacity or availability revenues from RMR Agreements for any Unit, Reliability Compensation Services Tariff, and Residual Unit Commitment capacity payments, but excluding payments described in clauses (a) through (c) above). In accordance with Section 4.9 of this Confirmation and Section 9 of the WSPP Agreement, all such revenues received by Seller, or a Unit’s SC, owner, or operator shall be remitted to Buyer, and Seller shall indemnify Buyer for any such revenues that Buyer does not receive, and Seller shall pay such revenues to Buyer if the Unit’s SC, owner, or operator fails to remit those revenues to Buyer. If Seller fails to pay such revenues to Buyer, Buyer may offset any amounts owing to it for such revenues pursuant to Section 9 of the WSPP Agreement against any future amounts it may owe to Seller under this Confirmation.
5. CAISO OFFER REQUIREMENTS
During the Delivery Period, except to the extent any Unit is in an Outage, or is affected by an Uncontrollable Force that results in a partial or full Outage of that Unit, Seller shall either schedule or cause 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 shall perform all, or cause 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.
6. RESERVED CAPACITY AND SUBSTITUTE CAPACITY
6.1 For any Showing Month, no later than three (3) Business Days before the applicable Compliance Showing deadline, Buyer may designate 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 that Showing Month (“Reserved Capacity”).
6.2 Subject to Section 6.3, all Reserved Capacity shall be treated as Designated RA Capacity actually delivered under Section 4.6(b) for purposes of calculating the Monthly RA Capacity Payment.
6.3 In any Showing Month in which Buyer has designated Reserved Capacity, Buyer may request, in writing, that Seller make the Reserved Capacity available for Buyer’s use as Substitute Capacity within the respective Showing Month (“Substitute Capacity Request”) with the following schedule. (a) For Buyer’s Substitute Capacity Requests that are to be scheduled with CAISO prior to the Showing Month (e.g., through the CAISO RA Substitute Capacity Assessment), the Substitute Capacity Request shall be received by Seller at least two (2) Business Days prior to the applicable CAISO scheduling deadline. Seller shall, or shall cause the Unit’s Scheduling Coordinator to, comply with Buyer’s request under this Section 6.3, provided that to the extent Seller is unable to provide the requested Substitute Capacity from the Unit due to a forced outage of the Unit, including as a result of an Uncontrollable Force, Seller shall not be liable for any amounts under Sections 4.7 and 4.8.
(b) For Buyer’s Substitute Capacity Requests that are to be scheduled with CAISO after the commencement of the Showing Month, the Substitute Capacity Request shall be received by Seller at least five (5) Business Days before Buyer submits its Substitute Capacity in CIRA. Seller shall, or shall cause the Unit’s Scheduling Coordinator to, comply with Buyer’s request under this Section 6.3, provided that to the extent Seller is unable to provide the requested Substitute Capacity from the Unit due to a forced outage of the Unit, including as a result of an Uncontrollable Force, Seller shall not be liable for any amounts under Sections 4.7 and 4.8.
DocuSign Envelope ID: BA154A9F-8793-4CED-9D92-04175A51DC3A DocuSign Envelope ID: A1E8DFF0-C337-482A-B6B1-CEC53ADD7C62 Appendix A High Desert Power
12 6.4 Nothing in this Article 6 changes any of Seller or Buyer’s rights or obligations under this Confirmation with respect to Contract Quantity not designated as Reserved Capacity.
7. OTHER BUYER AND SELLER COVENANTS
7.1 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 the Contract Quantity for the sole benefit of Buyer's RAR, LAR and/or FCR, as applicable, or that of a Subsequent Buyer under Article 10. Such commercially reasonable actions (neither Party shall be required to spend more than $10,000 in total under the Agreement in support of such actions) shall include, 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, the 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 RAR, LAR or FCR to demonstrate that the Contract Quantity can be delivered to the CAISO Controlled Grid, pursuant to “deliverability” standards established by the CAISO, or other Governmental Body having jurisdiction to administer RAR, LAR and/or FCR; and (b) Subject to Section 4.4, negotiating in good faith to make necessary amendments, if any, to this Confirmation to conform this Transaction to subsequent clarifications, revisions, or decisions rendered by the CPUC, CAISO, FERC, or other Governmental Body having jurisdiction to administer RAR, LAR and FCR, in each case occurring after the Confirmation Effective Date, so as to maintain the benefits of the bargain struck by the Parties on the Confirmation Effective Date.
7.2 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, CAISO, CPUC or other jurisdictional LRA, 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 such analogous capacity 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 capacity 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 maintain and operate each Unit using Good Utility Practice and, if applicable, General Order 167 as outlined by the CPUC in the Enforcement of Maintenance and Operation Standards for Electric Generating Facilities DocuSign Envelope ID: BA154A9F-8793-4CED-9D92-04175A51DC3A DocuSign Envelope ID: A1E8DFF0-C337-482A-B6B1-CEC53ADD7C62 Appendix A High Desert Power
13 Adopted May 6, 2004, and is obligated to abide by all Applicable Laws in operating such Unit; provided, that the owner or operator of any Unit is not required to undertake capital improvements, facility enhancements, or the construction of new facilities; (f) The owner or operator of each Unit is obligated to comply with Applicable Laws, including the Tariff, relating to RA Capacity and, as applicable, RAR, LAR and/or FCR; (g) If Seller is the owner of any Unit, the respective cumulative sums 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;
(h) With respect to the RA Capacity provided under this Confirmation, Seller shall, and each Unit’s SC is obligated to, comply with Applicable Laws, including the Tariff, relating to RA Capacity, and RAR, LAR and FCR;
(i) Seller shall notify the SC of each Unit that Seller has transferred the Designated RA Capacity to Buyer, and the SC is obligated to deliver the Supply Plans in accordance with the Tariff;
(j) Seller shall notify the SC of each Unit that Seller is obligated to cause each Unit’s SC to provide to the Buyer, by the Notification Deadline, 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
(k) Seller shall notify each Unit’s SC that Buyer is entitled to the revenues set forth in Section
4.10 of this Confirmation, and such SC is obligated to promptly deliver those revenues to Buyer, along with appropriate documentation supporting the amount of those revenues.
8. ASSIGNMENT
Neither Party may voluntarily assign its rights under this Transaction without the prior written consent of the other Party; provided, however, that notwithstanding anything in the WSPP Agreement to the contrary, such consent shall not be unreasonably withheld, conditioned, or delayed if the proposed assignee has a Credit Rating that is at least investment grade or its creditworthiness is otherwise reasonably satisfactory.
9. CONFIDENTIALITY
The Parties agree that Buyer may disclose information regarding this Transaction to any Governmental Body, the CPUC, the CAISO or any LRA having jurisdiction as necessary to support its LAR Showings, RAR Showings, and/or FCR Showings, as applicable, and Seller may disclose information regarding this Transaction to the SC of each Unit in order for such SC to timely submit accurate Supply Plans. Buyer may also disclose to any Subsequent Buyer whatever information regarding this Transaction is commercially reasonable for such party to evaluate the re-sale; provided that any Subsequent Buyer agrees in writing to maintain the confidentiality of such information consistent with this Section 9. Upon request or demand of any third person or entity not a Party hereto to Buyer pursuant to the California Public Records Act for production, inspection and/or copying of confidential information regarding this Transaction, Buyer will as soon as practical notify Seller in writing via email that such request has been made. Seller will be responsible for taking whatever legal steps are necessary to prevent Buyer’s release of such information to the third party. Seller acknowledges that Buyer is a public agency subject to the requirements of the California Public Records Act (Cal. Gov. Code section 6250 et seq.).
DocuSign Envelope ID: BA154A9F-8793-4CED-9D92-04175A51DC3A DocuSign Envelope ID: A1E8DFF0-C337-482A-B6B1-CEC53ADD7C62 Appendix A High Desert Power
14 10.
BUYER’S RE-SALE OF PRODUCT
(a) Buyer may re-sell all or a portion of the Contract Quantity of Product hereunder; provided, however, that (i) any Subsequent Buyer assumes all of Buyer’s obligations and liabilities hereunder, and (ii) any such re-sale does not increase Seller’s obligations or liabilities hereunder. Seller will, or will cause the Unit’s SC, to follow Buyer’s instructions with respect to providing such resold Product to Subsequent Buyers, 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 Buyers to use such resold Product in a manner consistent with Buyer’s rights under this Confirmation. If Buyer incurs any liability to a Subsequent Buyer due to the failure of Seller or the Unit’s SC to comply with this Confirmation, Seller will be liable to Buyer for the same amounts Seller would have owed Buyer under this Confirmation if Buyer had not resold the Product. If Seller incurs any liability to a Subsequent Buyer due to the failure of Buyer or the Subsequent Buyer to comply with this Confirmation, Buyer will be liable to Seller for the same amounts Buyer would have owed Supplier under this Confirmation if Buyer had not resold the Product.
(b) Buyer will notify Seller in writing of any resale of Product and the Subsequent Buyer no later than two (2) Business Days before the Notification Deadline for the Showing Month.
Buyer will notify Seller of any subsequent changes or further resales no later than two (2) Business Days before the Notification Deadline for the Showing Month. Seller agrees, and agrees to cause the Unit’s SC, to: (i) follow Buyer’s reasonable instructions with respect to providing such resold Product to Subsequent Buyers of such resold Product; and (ii) take all commercially reasonable actions and execute any and all documents or instruments reasonably necessary to allow such Subsequent Buyers to use such resold Product. (c) If CAISO or CPUC develops a centralized capacity market, Buyer will have exclusive rights to direct Seller to offer, bid, or otherwise submit the applicable Contract Quantity of Product for each day during the Delivery Period provided to Buyer pursuant to this Confirmation for re-sale in such market, and Seller and the Unit’s SC shall comply with Buyer’s direction and Buyer shall retain and receive all revenues from such re-sale. Seller agrees to take all commercially reasonable actions to assist Buyer with such re-sale, provided that Seller’s obligation to assist shall not require modification of any of the commercial terms of this Confirmation.
11. MARKET BASED RATE AUTHORITY
Seller agrees, in accordance with Federal Energy Regulatory Commission (FERC) Order No. 697, to, upon request of Buyer, 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 also agrees that it will 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.
12. COLLATERAL REQUIREMENTS
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.
DocuSign Envelope ID: BA154A9F-8793-4CED-9D92-04175A51DC3A DocuSign Envelope ID: A1E8DFF0-C337-482A-B6B1-CEC53ADD7C62 Appendix A High Desert Power
15 13.
OTHER WSPP AGREEMENT CHANGES
13.1 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;
(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 DocuSign Envelope ID: BA154A9F-8793-4CED-9D92-04175A51DC3A DocuSign Envelope ID: A1E8DFF0-C337-482A-B6B1-CEC53ADD7C62 Appendix A High Desert Power
16 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 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:
“34.5LIMITATION 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 DocuSign Envelope ID: BA154A9F-8793-4CED-9D92-04175A51DC3A DocuSign Envelope ID: A1E8DFF0-C337-482A-B6B1-CEC53ADD7C62 Appendix A High Desert Power
17 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.”
13.2 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.
13.3 No Recourse to Members of Buyer
Buyer is organized as a Joint Powers Authority in accordance with the Joint Exercise of Powers Act of the State of California (Government Code Section 6500, et seq.) and is a public entity separate from its constituent members. Buyer 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 Buyer's constituent members, or the officers, directors, advisors, contractors, consultants or employees of Buyer or Buyer’s constituent members, in connection with this Confirmation.
13.4 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.
DocuSign Envelope ID: BA154A9F-8793-4CED-9D92-04175A51DC3A DocuSign Envelope ID: A1E8DFF0-C337-482A-B6B1-CEC53ADD7C62 Appendix A High Desert Power
DocuSign Envelope ID: A1E8DFF0-C337-482A-B6B1-CEC53ADD7C62 Appendix A
High Desert Power
DocuSign Envelope ID: BA154A9F-8793-4CED-9D92-04175A51DC3A
13.5 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.
ACKNOWLEDGED AND AGREED TO AS OF THE CONFIRMATION EFFECTIVE DATE
HIGH DESERT POWER PROJECT, LLC
a California limited liability company
Name:
Title: I/?
SILICON VALLEY CLEAN ENERGY
AUTHORITY, a California joint powers
By:
Girish BaTacI Name:
Title: CE0
J
DocuSIgrwd by:
18 19
Appendix A
Shown Unit Information
Name: High Desert Power Project
Aggregate
Location: Victorville, CA
CAISO Resource ID: HIDSRT_2_UNITS
Unit SCID: TS30
Unit NQC: 830
Unit EFC: 630
Resource Type: Natural Gas
Resource Category (MCC 1, 2, 3 or
4): 4 - (available all 24 hours)
Flexible Capacity Category (1, 2 or
3): 1
Path 26 (North or South): South
Local Capacity Area (if any, as of
Confirmation Effective Date): n/a
Deliverability restrictions, if any, as
described in most recent CAISO
deliverability assessment:
none
Run Hour Restrictions: None. Available 24 hours per day.
DocuSign Envelope ID: BA154A9F-8793-4CED-9D92-04175A51DC3A DocuSign Envelope ID: A1E8DFF0-C337-482A-B6B1-CEC53ADD7C62 Appendix A High Desert Power
20 Appendix B
Notice Information
Seller: Buyer:
DocuSign Envelope ID: BA154A9F-8793-4CED-9D92-04175A51DC3A DocuSign Envelope ID: A1E8DFF0-C337-482A-B6B1-CEC53ADD7C62 Appendix A High Desert Power
1 MASTER POWER PURCHASE AND SALE AGREEMENT
CONFIRMATION LETTER - RESOURCE ADEQUACY
BETWEEN
SILICON VALLEY CLEAN ENERGY AUTHORITY
AND
3PR TRADING, INC.
This Confirmation Letter (“Confirmation”) confirms the Transaction between Silicon Valley Clean Energy Authority, a California joint powers authority (“Buyer”) and 3PR Trading, Inc. (“Seller”), each individually a “Party” and together the “Parties”, dated as of June 1, 2023 (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 EEI Master Power Purchase and Sale Agreement, effective as of November 28, 2016, as amended from time to time (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). To the extent that this Confirmation is inconsistent with any provision of the Master Agreement, this Confirmation shall control and shall govern the rights and obligations of the Parties in connection with the Transaction.
ARTICLE 1. DEFINITIONS
1.1 “Alternate Capacity” means any replacement Product which Seller has elected to provide to Buyer from a Replacement Unit 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 of competent jurisdiction over one or both Parties or this Transaction, including without limitation, the Tariff.
1.3 “Availability Incentive Payments” has the meaning set forth in the Tariff.
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. The 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.”
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 specified for such Monthly Delivery Period 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 the Contract Quantity (MWs) table in Section 4.3 which Seller has agreed to provide to Buyer from the Unit for such Showing Month, as such amount may be adjusted pursuant to Section 4.4.
1.13 “CPUC Decisions” means, to the extent still applicable, 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- DocuSign Envelope ID: 0B18DF7E-E62C-4988-A733-B3E7F19B2104 DocuSign Envelope ID: 84756BB5-CCF3-44CD-A614-0B539749B2C2 DocuSign Envelope ID: 8DA64748-207A-40A4-9282-A0B16A3FCCB7 Appendix A 3PR
2 025, 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, with respect to any particular Showing Month of the Delivery Period, the Contract Quantity of Product (including any Alternate Capacity) for such Showing Month, minus (i) any reductions to Contract Quantity made by Seller pursuant to Section
4.4 and for which Seller has not elected to provide Alternate Capacity; and (ii) any reductions resulting from an event other than a Non-Excusable Event.
1.18 “Flexible RA Attributes” means any and all flexible resource adequacy attributes, as may be identified at any time during the Delivery Period by the CPUC, CAISO or other Governmental Body of competent jurisdiction that can be counted toward Flexible RAR, exclusive of any RA Attributes and LAR Attributes.
1.19 “Flexible RAR” means the flexible resource adequacy requirements established for LSEs by the CPUC pursuant to the CPUC Decisions, or by any other Governmental Body of competent jurisdiction.
1.20 “Flexible RAR Showing” means the Flexible RAR 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 of competent jurisdiction over the LSE.
1.21 “Generic RA Product” means Designated RA Capacity consisting of RA Attributes and, if applicable, LAR Attributes, which does not include Flexible RA Attributes.
1.22 “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.
1.23 “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 of competent jurisdiction over the LSE. LAR may also be known as local resource adequacy, local RAR, or local capacity requirement in other regulatory proceedings or legislative actions.
1.24 “LAR Attributes” means, with respect to a Unit, any and all local resource adequacy attributes (or other locational attributes related to system reliability), as they are identified as of the Confirmation Effective Date by the CPUC, CAISO, LRA, or other Governmental Body of competent 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 and Flexible RA Attributes. 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.
1.25 “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 of competent jurisdiction over the LSE.
1.26 “Local RAR” means the local resource adequacy requirements established for LSEs by the CPUC pursuant to the CPUC Decisions, or by any other Governmental Body of competent jurisdiction.
Local RAR may also be known as local area reliability, local resource adequacy, local resource DocuSign Envelope ID: 0B18DF7E-E62C-4988-A733-B3E7F19B2104 DocuSign Envelope ID: 84756BB5-CCF3-44CD-A614-0B539749B2C2 DocuSign Envelope ID: 8DA64748-207A-40A4-9282-A0B16A3FCCB7 Appendix A 3PR
3 adequacy procurement requirements, or local capacity requirement in other regulatory proceedings or legislative actions.
1.27 “LRA” means Local Regulatory Authority as defined in the Tariff.
1.28 “LSE” means load-serving entity. LSEs may be an investor-owned utility, an electric service provider, a community aggregator or community choice aggregator, or a municipality serving load in the CAISO Control Area (excluding exports).
1.29 “Monthly Delivery Period” means each calendar month during the Delivery Period and shall correspond to each Showing Month.
1.30 “Monthly RA Capacity Payment” has the meaning specified in Section 4.9 hereof.
1.31 “Net Qualifying Capacity” has the meaning set forth in the Tariff.
1.32 “Non-Excusable Event” means any event, other than a Planned Outage that is acceptably noticed pursuant to the Notification Deadline 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) Seller’s failure to 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.
1.33 “Notification Deadline” has the meaning specified in Section 4.5 hereof.
1.34 “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.
1.35 “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.
1.36 “Product” has the meaning specified in Article 3 hereof.
1.37 “RA Attributes” means, with respect to a Unit, any and all resource adequacy attributes, as they are identified as of the Confirmation Effective Date by the CPUC, CAISO or other Governmental Body of competent jurisdiction that can be counted toward RAR, exclusive of any LAR Attributes and Flexible RA Attributes.
1.38 “RA Capacity” means the qualifying and deliverable capacity of the Unit for RAR and, if applicable, LAR and Flexible RAR 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 RA Attributes, and if applicable, LAR Attributes and Flexible RA Attributes of the capacity provided by a Unit.
1.39 “RAR” means the resource adequacy requirements (other than Local RAR or Flexible RAR) established for LSEs by the CPUC pursuant to the CPUC Decisions, or by any other Governmental Body of competent jurisdiction.
1.40 “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 CPUC Decisions, or to an LRA of competent jurisdiction.
1.41 “Replacement Capacity” has the meaning specified in Section 4.7 hereof.
1.42 “Replacement Unit” has the meaning specified in Section 4.5.
1.43 “Resource Category” shall be as described in the CPUC Filing Guide, as such may be modified, amended, supplemented or updated from time to time.
1.44 “Scheduling Coordinator” has the same meaning as in the Tariff.
DocuSign Envelope ID: 0B18DF7E-E62C-4988-A733-B3E7F19B2104 DocuSign Envelope ID: 84756BB5-CCF3-44CD-A614-0B539749B2C2 DocuSign Envelope ID: 8DA64748-207A-40A4-9282-A0B16A3FCCB7 Appendix A 3PR
4 1.45 “Seller” has the meaning specified in the introductory paragraph hereof.
1.46 “Showing Month” shall be the calendar month during the Delivery Period that is the subject of the RAR Showing, as set forth in the CPUC Decisions. For illustrative purposes only, pursuant to the CPUC Decisions in effect as of the Confirmation Effective Date, the monthly RAR Showing made in June is for the Showing Month of August.
1.47 “Supply Plan” means the supply plan, or similar or successor filing, that a Scheduling Coordinator representing RA Capacity submits to the CAISO, LRA, or other applicable Governmental Body pursuant to Applicable Laws in order for the RA Attributes or LAR Attributes of such RA Capacity to count.
1.48 “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.
1.49 “Transaction” for purposes of this Agreement means the Transaction (as defined in the Master Agreement) that is evidenced by this Agreement.
1.50 “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. A Unit shall not be a coal-fired generating facility.
1.51 “Unit EFC” means the effective flexible capacity that is or will be set by the CAISO for the applicable Unit.
1.52 “Unit NQC” means the Net Qualifying Capacity set by the CAISO for the applicable Unit. The Parties agree that if the CAISO adjusts the Net Qualifying Capacity of a Unit after the Confirmation Effective Date, that 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.
ARTICLE 2. UNIT INFORMATION
Name Colgate Hydro Unit 2
Location Yuba County, CA
CAISO Resource ID COLGAT_7_UNIT_2
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
DocuSign Envelope ID: 0B18DF7E-E62C-4988-A733-B3E7F19B2104 DocuSign Envelope ID: 84756BB5-CCF3-44CD-A614-0B539749B2C2 DocuSign Envelope ID: 8DA64748-207A-40A4-9282-A0B16A3FCCB7 Appendix A 3PR
5 ARTICLE 3. RESOURCE ADEQUACY CAPACITY PRODUCT
3.1 Resource Adequacy Capacity Product
During the Delivery Period, Seller shall provide to Buyer, pursuant to the terms of this Agreement, 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.
Rather, the Product confers the right to include the Designated RA Capacity in RAR Showings, LAR Showings, Flexible RAR Showings, if 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 RA Capacity from a Unit in excess of that Unit’s Contract Quantity and any RA Attributes, LAR Attributes or Flexible RA 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:
[ ] Flexible RA Attributes with LAR Attributes
[ ] Flexible RA Attributes with RA 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] RA Attributes
[ ] LAR Attributes
3.3 Delivery Obligation
Contingent Firm RA Product
Seller shall provide Buyer with Designated RA Capacity from the Units. If those Units are not available to provide the full amount of the Contract Quantity as a result of any Planned Outage of the Unit(s) and/or reduction in the Unit EFC or Unit NQC of such Unit, 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 all or some of the Alternate Capacity to fulfill the remainder of the Contract Quantity or portion thereof, from one or more Replacement Units pursuant to Section 4.5 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 (i) for any reason other than a Non-Excusable Event or (ii) in accordance with Section 4.4, Seller is not obligated to provide Buyer with Alternate Capacity or to indemnify Buyer for any resulting penalties or fines.
ARTICLE 4. DELIVERY AND PAYMENT
4.1 Delivery Period
The Delivery Period shall be:
DocuSign Envelope ID: 0B18DF7E-E62C-4988-A733-B3E7F19B2104 DocuSign Envelope ID: 84756BB5-CCF3-44CD-A614-0B539749B2C2 DocuSign Envelope ID: 8DA64748-207A-40A4-9282-A0B16A3FCCB7 Appendix A 3PR
6 4.2 Delivery Point
The Delivery Point for each Unit shall be the CAISO Control Area, and if applicable, the LAR region in which the Unit is electrically interconnected.
4.3 Contract Quantity The Contract Quantity for each Monthly Delivery Period shall be:
Contract Quantity (MWs)
Contract Month Contract Quantity
(MWs)
4.4 Adjustments to Contract Quantity
(a) Planned Outages: If Seller is unable to provide the applicable Contract Quantity for 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.
(b) Invoice Adjustment: In the event that the Contract Quantity is reduced due to (i) a Planned Outage as set forth in Section 4.4(a) above or (ii) a reduction in Unit NQC and/or Unit EFC as set forth in Section 4.4(c) below and Seller does not elect to provide Alternate Capacity, then the invoice for such month(s) shall be adjusted to reflect a daily pro rata amount for the duration of such reduction. (c) Reductions in Unit NQC and/or Unit EFC: 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 and/or Unit EFC as determined by the CAISO. If the Unit experiences such a reduction in Unit NQC and/or Unit EFC, 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) Alternate Capacity up to the Contract Quantity.
4.5 Notification Deadline and Replacement Units
(a) The “Notification Deadline” in respect of a Showing Month shall be ten (10) Business Days before the earlier of the relevant deadlines for (a) the corresponding RAR Showings, Flexible RAR Showings and/or LAR Showings for such Showing Month, and (b) the CAISO Supply Plan filings applicable to that Showing Month.
(b) If Seller desires to provide the Contract Quantity of Product for any Showing Month from a generating unit other than the Unit (a “Replacement Unit”), then Seller may, at no additional cost to Buyer, provide Buyer with Product from one or more Replacement Units, up 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, provided however that the Replacement Unit shall not be a coal-fired generating facility. (c) If Seller fails to provide Buyer any portion of the Designated RA Capacity for a given Showing Month during the Delivery Period, then Buyer may, but shall not be required to, purchase such Product from a third party. Seller shall not 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 to the extent the failure to deliver the Contract Quantity is the result of (A) a reduction in the Contract Quantity for such Showing Month in accordance with Section 4.4, or (B) an event other than a Non-Excusable Event.
DocuSign Envelope ID: 0B18DF7E-E62C-4988-A733-B3E7F19B2104 DocuSign Envelope ID: 84756BB5-CCF3-44CD-A614-0B539749B2C2 DocuSign Envelope ID: 8DA64748-207A-40A4-9282-A0B16A3FCCB7 Appendix A 3PR
7 4.6 Delivery of Product
(a) Seller shall provide Buyer with the Designated RA Capacity of Product for each Showing Month. (b) Seller shall submit, or cause the Unit’s Scheduling Coordinator to submit, by the Notification Deadline (i) Supply Plans to the CAISO, LRA, or other applicable Governmental Body identifying and confirming the Designated RA Capacity to be provided to Buyer for the applicable Showing Month, unless Buyer specifically requests in writing that Seller not do so (it being understood that any Designated RA Capacity subject to such a request from Buyer will be deemed to have been provided to Buyer for all purposes under this Confirmation); and (ii) written confirmation to Buyer that Buyer will be credited with the Designated RA Capacity for such Showing Month per the Unit’s Scheduling Coordinator Supply Plan.
(c) The Product is delivered and received when the CIRA Tool shows the Supply Plan accepted for the Product from the Unit by CAISO or Seller complies with Buyer’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) Buyer has elected to submit the Product from the 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 due to a Seller error, and are rejected by CAISO and not corrected by the time the CIRA Tool is locked for the applicable Showing Month or (ii) Seller fails to submit the volume of Designated RA Capacity for any Showing Month pursuant to this Confirmation and Buyer has not provided instruction to withhold all or part of the Designated RA Capacity. Buyer will have received the Contract Quantity if (i) Seller’s Supply Plan is accepted by the CAISO for the applicable Showing Month or, (ii) Seller correctly submits the Supply Plan and the Supply Plan and/or Resource Adequacy Plan are not matched in the CIRA Tool due to a Buyer error, or (iii) Seller complies with Buyer’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 Buyer fails or chooses not to submit the Unit and the Product in its Resource Adequacy Plan with the CPUC or CAISO.
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 Agreement, then the following shall apply:
(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, and, if applicable, LAR Attributes, and Flexible RA 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 RA Attributes and no LAR Attributes or Flexible RA Attributes, and no such RA Capacity is available, then Buyer may replace such portion of the Designated RA Capacity with capacity having any applicable Flexible RA Attributes and/or LAR Attributes (“Replacement Capacity”) by entering into purchase transactions with one or more third parties, including, without limitation, third parties who have purchased capacity from Buyer so long as such transactions are done at prevailing market prices. 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 actual cost paid by Buyer for any Replacement Capacity, and (B) each Capacity Replacement Price times the amount of the Designated RA Capacity neither provided by Seller nor purchased by Buyer pursuant to Section 4.7(a); and (ii) the Designated RA Capacity not provided for the applicable Showing Month times the Contract Price for that month. If Seller fails to pay these damages, then Buyer may offset those damages owed it against any CAISO revenues or future amounts it may owe to Seller under this Confirmation pursuant to the Master Agreement.
DocuSign Envelope ID: 0B18DF7E-E62C-4988-A733-B3E7F19B2104 DocuSign Envelope ID: 84756BB5-CCF3-44CD-A614-0B539749B2C2 DocuSign Envelope ID: 8DA64748-207A-40A4-9282-A0B16A3FCCB7 Appendix A 3PR
8 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, to the extent not otherwise paid by Seller to Buyer under Section 4.7(b), resulting from any of the following:
(a) Seller’s failure to provide any portion of the Designated RA Capacity due to a Non-Excusable Event; (b) Seller’s failure to provide notice of the non-availability of any portion of Designated RA Capacity as required under Sections 3.2, 4.4 and 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 offset those penalties, fines or costs against any future amounts it may owe to Seller under this Confirmation.
4.9 Monthly RA Capacity Payment
Notwithstanding Article 6 of the Master Agreement, Buyer shall make a Monthly RA Capacity Payment to Seller for each Unit, in arrears, after the applicable Showing Month. Each Unit’s Monthly RA Capacity Payment shall be equal to the product of (a) the applicable Contract Price for that Monthly Delivery Period, (b) the Designated RA Capacity for the Monthly Delivery Period, and (c) 1,000, 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.
RA CAPACITY PRICE TABLE
Contract Month RAR Capacity Price
($/kW-month)
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) 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, Flexible RAR Showing, as may be applicable, 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. 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. However, Buyer shall be entitled to receive and retain all revenues associated with the Designated RA Capacity of any Unit during the Delivery Period (including any capacity or availability revenues from RMR Agreements for any Unit, Reliability Compensation Services Tariff, and Residual Unit Commitment capacity payments, but excluding payments described in clauses (a) through (e) above, if applicable, and so long as the availability to earn such revenues does not increase Seller’s obligations or liabilities hereunder). In accordance with Section 4.9 of this Confirmation, all such Buyer revenues received by Seller, or a Unit’s Scheduling Coordinator, owner, or operator shall be remitted to Buyer, and Seller shall indemnify Buyer for any such revenues that Seller does not remit to Buyer, and Seller shall pay such revenues received by it to Buyer if the Unit’s Scheduling Coordinator, owner, or operator fails to remit those revenues to DocuSign Envelope ID: 0B18DF7E-E62C-4988-A733-B3E7F19B2104 DocuSign Envelope ID: 84756BB5-CCF3-44CD-A614-0B539749B2C2 DocuSign Envelope ID: 8DA64748-207A-40A4-9282-A0B16A3FCCB7 Appendix A 3PR
9 Buyer. If Seller or the Unit’s Scheduling Coordinator, owner, or operator (as applicable) fails to pay such revenues to Buyer, Buyer may offset any amounts owing to it for such revenues against any future amounts it may owe to Seller under this Confirmation. 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 other than a Non-Excusable Event, that results in a partial or full outage of that Unit, Seller shall either schedule or cause 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 shall perform all, or cause 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. RESERVED
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 the Contract Quantity for the sole benefit of Buyer’s applicable RAR, LAR and Flexible RAR. Such commercially reasonable actions shall include, 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 the applicable RAR, LAR, and Flexible RAR 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 CPUC, the CAISO, a LRA of competent jurisdiction, or other Governmental Body of competent jurisdiction to administer the applicable RAR, LAR and Flexible RAR, to demonstrate that the Contract Quantity can be delivered to the CAISO Controlled Grid for the minimum hours required to qualify as RA Capacity, pursuant to the “deliverability” standards established by the CAISO or other Governmental Body of competent jurisdiction; and
(b) negotiating in good faith to make necessary amendments, if any, to this Confirmation, which are subject to agreement of such Parties, in each Party’s sole discretion, to conform this Transaction to subsequent clarifications, revisions, or decisions rendered by the CPUC, FERC, or other Governmental Body of competent jurisdiction to administer the applicable RAR, LAR and Flexible RAR, so as to maintain the purpose and intent of the Transaction agreed to by the Parties on the Confirmation Effective Date. The above notwithstanding, the Parties are aware that the CPUC and CAISO are considering changes to RAR and/or LAR in CPUC Rulemaking 17-09-020 and potentially other proceedings;
Provided, however, that “commercially reasonable actions” under this Section 7,1 shall not require the Seller, or the owner or operator of any Unit to undertake any capital improvements, facility enhancements, or the construction of new facilities.
DocuSign Envelope ID: 0B18DF7E-E62C-4988-A733-B3E7F19B2104 DocuSign Envelope ID: 84756BB5-CCF3-44CD-A614-0B539749B2C2 DocuSign Envelope ID: 8DA64748-207A-40A4-9282-A0B16A3FCCB7 Appendix A 3PR
10 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, the CPUC, a LRA of competent jurisdiction, 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 such third party’s applicable RAR, LAR or Flexible RAR 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 or Flexible RAR, 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 maintain and operate each Unit using Good Utility Practice and, if applicable, in accordance with General Order 167 as outlined by the CPUC in the Enforcement of Maintenance and Operation Standards for Electric Generating Facilities Adopted May 6, 2004, and is obligated to abide by all Applicable Laws in operating such Unit; provided, that the owner or operator of any Unit is not required to undertake capital improvements, facility enhancements, or the construction of new facilities; (f) The owner or operator of each Unit is obligated to comply with Applicable Laws, including the Tariff, relating to RA Capacity, RAR, LAR and Flexible RAR;
(g) If Seller is the owner of any Unit, the aggregation of all amounts of applicable LAR Attributes, RA Attributes and Flexible RA Attributes that Seller has sold, assigned or transferred for any Unit does not exceed that Unit’s RA Capacity;
(h) 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 Flexible RAR;
(i) 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;
(j) Seller has notified the Scheduling Coordinator of each Unit that Seller is obligated to cause each Unit’s Scheduling Coordinator to provide to the Buyer, by the Notification Deadline, 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
(k) 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
In addition to the rights and obligations in the Master Agreement, 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 of competent jurisdiction in order to support its applicable LAR, RAR or Flexible RAR Showings, if applicable, and Seller may disclose the transfer of the Designated RA Capacity under this Transaction to the Scheduling Coordinator of each Unit in order for such Scheduling Coordinator to timely submit accurate Supply Plans.
DocuSign Envelope ID: 0B18DF7E-E62C-4988-A733-B3E7F19B2104 DocuSign Envelope ID: 84756BB5-CCF3-44CD-A614-0B539749B2C2 DocuSign Envelope ID: 8DA64748-207A-40A4-9282-A0B16A3FCCB7 Appendix A 3PR
11 ARTICLE 9. BUYER’S RE-SALE OF PRODUCT
Buyer may re-sell all or a portion of the Product hereunder; provided, however, that any such re-sale does not increase Seller’s obligations or liabilities hereunder.
ARTICLE 10. MARKET BASED RATE AUTHORITY
Upon Buyer’s written request, 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
Notwithstanding any provision in the Master Agreement to the contrary, neither Party shall be required to post collateral or other security for this Transaction.
ARTICLE 12. NO RECOURSE TO MEMBERS OF BUYER
Buyer is organized as a Joint Powers Authority in accordance with the Joint Exercise of Powers Act of the State of California (Government Code Section 6500, et. seq.) and is a public entity separate from its constituent members.
Buyer will solely be responsible for all debts, obligations and liabilities accruing and arising out of this Confirmation.
Seller will have no rights and will not make any claims, take any actions or assert any remedies against any of Buyer’s constituent members, or the officers, directors, advisors, contractors, consultants or employees of Buyer or Buyer’s constituent members, in connection with this Confirmation.
ARTICLE 13. 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, facsimile or scanned signatures as originals under this Confirmation. Delivery of an executed signature page of this Confirmation by facsimile or electronic mail transmission (including PDF) shall be the same as delivery of a manually executed signature.
ACKNOWLEDGED AND AGREED TO AS OF THE CONFIRMATION EFFECTIVE DATE.
SILICON VALLEY CLEAN ENERGY
AUTHORITY, a California joint powers
authority
3PR TRADING, INC.
By: ______________________________ By: __________________________ Name: ______________________________ Name: __________________________ Title: _______________________________ Title: ___________________________ DocuSign Envelope ID: 0B18DF7E-E62C-4988-A733-B3E7F19B2104 CEO
Girish Balachandran
DocuSign Envelope ID: 84756BB5-CCF3-44CD-A614-0B539749B2C2 Eric Hulin
Director, Sales & Marketing
DocuSign Envelope ID: 8DA64748-207A-40A4-9282-A0B16A3FCCB7 Appendix A 3PR
DocuSigned by:
5CA64B9AC4C24C3...
DocuSigned by:
MlA,
71C08B299923479..
1 T-45 Resource Adequacy Capacity SCE Sale Confirmation (not applicable to Substitution RA) v. 2022.08.12
MASTER POWER PURCHASE AND SALE AGREEMENT
CONFIRMATION LETTER
BETWEEN
SILICON VALLEY CLEAN ENERGY AUTHORITY
AND
SOUTHERN CALIFORNIA EDISON COMPANY
This confirmation letter including all appendices hereto (“Confirmation”) confirms the Transaction between Silicon Valley Clean Energy Authority (“Counterparty”) and Southern California Edison Company (“SCE”), each individually a “Party” and together the “Parties”, dated as of ________________ (the “Confirmation Effective Date”) in which Seller agrees to provide to Buyer the right to the Product, as such term is defined in this Confirmation, in the amounts described in this Confirmation. This Transaction is governed by the Edison Electric Institute (“EEI”) Master Power Purchase and Sale Agreement between the Parties, effective as of February 7, 2018, along with the Cover Sheet, any amendments and annexes thereto (the “Master Agreement”), and including, the EEI Collateral Annex to the Master Agreement along with the Paragraph 10 to the Collateral Annex between the Parties (such Paragraph 10 and the Collateral Annex are referred to collectively herein as the “Collateral Annex”) (the Master Agreement and the Collateral Annex shall be collectively referred to as the “EEI Agreement”). The EEI 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 EEI Agreement, or the CAISO Tariff (defined herein below). To the extent this Confirmation is inconsistent with any provision of the EEI Agreement, this Confirmation shall govern the rights and obligations of the Parties hereunder.
ARTICLE 1. TRANSACTION TERMS
1.1 Product; Elections
Product: The product, including the Capacity Attributes of the Unit(s), as defined in Appendix C, or Alternate Unit(s) provided in accordance with Section 2.3.
Flexible Capacity: The Product shall include Flexible Capacity if identified in Appendix B as applicable.
1.2 Delivery and Receipt of Product
Seller shall sell and deliver to Buyer, and Buyer shall receive and purchase from Seller the Product in the amount of the applicable Contract Quantity for each month of the Delivery Period.
DocuSign Envelope ID: A6C5F11A-511C-4FBB-8D4B-407304618012 6/2/2023
DocuSign Envelope ID: 2A604A57-3AEC-4B87-B9B9-8482608E4B76 Appendix A SCE
Resource Adequacy Capacity Confirmation
SCE – Silicon Valley Clean Energy
Authority
2 1.3 Delivery Period and Term
(a) Delivery Period. The Delivery Period is as specified in Appendix B of this Confirmation in the row titled “Delivery Period”, unless terminated earlier in accordance with the terms of this Agreement.
(b) Term. The Term of this Transaction shall commence upon the Confirmation Effective Date and shall continue until the later of (i) the expiration of the Delivery Period or (ii) the date the Parties’ obligations under this Confirmation have been satisfied. This Confirmation shall be effective and binding as of the Confirmation Effective Date.
1.4 Contract Quantity
The Contract Quantity for each applicable Showing Month is as shown in Appendix B of this Confirmation under the heading titled “Contract Quantity.”
1.5 Flexible Capacity
If the Parties have designated Flexible Capacity as “Applicable”, then the Flexible Capacity included in the Contract Quantity for each applicable Showing Month is as shown in Appendix B of this Confirmation under the heading titled “Flexible Capacity.”
1.6 Contract Price
The Contract Price means, for any Showing Month, the price specified in Appendix B of this Confirmation under the heading titled “Contract Price,” for such Showing Month.
ARTICLE 2. DELIVERY OBLIGATIONS
2.1 Seller’s Delivery Obligations
Seller shall provide Buyer with the Expected Contract Quantity of Product for each Showing Month consistent with the following:
(a) Supply Plan Obligation. Seller shall, on a timely basis, submit, or cause the Unit’s SC to submit, (i) Monthly Supply Plans and (ii) Annual Supply Plans if the Confirmation Effective Date is prior to the year-ahead Compliance Showing Deadline applicable for the Showing Months as specified in Sections 1.4 and 1.5 herein, in accordance with the CAISO Tariff and no later than the initial Compliance Showing Deadline for such Showing Month, identifying and confirming the transfer of the Expected Contract Quantity of Product to Buyer for each Showing Month (the “Supply Plan Obligation”).
DocuSign Envelope ID: A6C5F11A-511C-4FBB-8D4B-407304618012 DocuSign Envelope ID: 2A604A57-3AEC-4B87-B9B9-8482608E4B76 Appendix A SCE
Resource Adequacy Capacity Confirmation
SCE – Silicon Valley Clean Energy
Authority
3 (b) Showing Month Notice. If (i) Seller intends to utilize an Alternate Unit in accordance with Section 2.3 to satisfy its Supply Plan Obligation, or (ii) Seller intends to deliver less than the Contract Quantity of Product for such Showing Month for any reason, then Seller shall, or shall cause the Unit’s SC to, submit written notification to Buyer (the “Showing Month Notice”), no later than the Compliance Notification Deadline, identifying either or both of the Alternate Units in accordance with Section 2.3 and the Expected Contract Quantity of Product if such amount is less than the Contract Quantity of Product, as applicable.
(c) Contract Quantity Unit Allocation. If Seller is delivering Product to Buyer from more than one Unit, Seller shall deliver such Product to Buyer from each Unit in accordance with the Contract Quantity Unit Allocation, as set forth in Appendix C; provided, Seller may modify the Contract Quantity Unit Allocation from time to time by providing email notice to Buyer’s Supply Plan contact, as set forth in Appendix D, no later than the initial Compliance Showing Deadline for each Showing Month.
2.2 Adjustments to Contract Quantity
Seller shall deliver to Buyer the Contract Quantity of Product for each Showing Month consistent with the following:
(a) Planned Outages: 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 if the following conditions are satisfied:
(i) Seller notifies Buyer no later than the Compliance Notification Deadline, of the amount of Product from the Unit Buyer is permitted to include in Buyer’s Compliance Showings applicable to that month as a result of such Planned Outage; and
(ii) such reduction to the Contract Quantity of Product can be reflected on Supply Plans in accordance with the CAISO Tariff.
(b) Reductions in Unit NQC and Unit EFC: Seller’s obligation to deliver the applicable Contract Quantity for each Showing Month may also be reduced in the event the Unit experiences a reduction in Unit NQC or Unit EFC after the Confirmation Effective Date as determined by the CAISO. In the event the Unit experiences such a reduction in Unit NQC or Unit EFC, 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 or (ii) from Alternate Units, provided, that in each case Seller provides and identifies such Alternate Units in accordance with Section 2.3.
DocuSign Envelope ID: A6C5F11A-511C-4FBB-8D4B-407304618012 DocuSign Envelope ID: 2A604A57-3AEC-4B87-B9B9-8482608E4B76 Appendix A SCE
Resource Adequacy Capacity Confirmation
SCE – Silicon Valley Clean Energy
Authority
4 (c) Reductions in Seller Supply Agreement: Seller’s obligation to deliver the applicable Contract Quantity for each Showing Month may also be reduced in the event that the underlying Seller supply agreement results in Seller’s inability to deliver the Product to Buyer in accordance with this Agreement.
Seller has the option, but not the obligation, to provide the applicable Contract Quantity for such Showing Month from Alternate Units, provided, that in each case Seller provides and identifies such Alternate Units in accordance with Section 2.3.
2.3 Seller’s Option To Provide Alternate Capacity
Seller may, at no cost to Buyer, provide Buyer with Product from one or more Alternate Units in an amount such that the total amount of Product provided to Buyer from the Unit and Alternate Units is not more than the Contract Quantity for the applicable Showing Month, provided that in each case:
(a) Seller shall notify Buyer no later than the Compliance Notification Deadline for such Showing Month of its intent to provide Product from and identify alternate units that (i) are like-for-like units similar to the Unit originally identified in Appendix C and have the same Capacity Attributes of the Unit originally identified in Appendix C, including the Resource Category and the Unit EFC Category; (ii) are accepted by the CAISO, and (iii) otherwise that satisfy the requirements of this Agreement (“Alternate Units”); (b) Seller shall, or shall cause the Unit’s SC to submit a Monthly Supply Plan and an Annual Supply Plan, as applicable, that includes the Alternate Units, in accordance with Section 2.1(a) hereof for such Showing Month; (c) if Seller does not comply with the requirements of Sections 2.3(a) and (b) for the applicable Showing Month, then any such Alternate Units shall not be deemed a Unit for purposes of this Confirmation for that Showing Month and Seller shall not receive payment for such Product.
Subject to the satisfaction of the conditions contained in subsections (a) – (c) of this Section 2.3, once Seller has identified in writing any Alternate Units that meet the requirements of this Section 2.3, then any such Alternate Units shall be automatically deemed a Unit for purposes of this Confirmation for that Showing Month.
2.4 Damages for Failure to Provide Capacity
If Seller fails to provide Buyer with the Expected Contract Quantity of Product for any Showing Month, in accordance with Section 2.1 (the “Replacement Obligation”), in each case as applicable, then the following shall apply:
(a) Buyer may, but shall not be required to, replace all or any portion of the Replacement Obligation for the applicable Showing Month with capacity having equivalent Capacity Attributes as the Expected Contract Quantity;
DocuSign Envelope ID: A6C5F11A-511C-4FBB-8D4B-407304618012 DocuSign Envelope ID: 2A604A57-3AEC-4B87-B9B9-8482608E4B76 Appendix A SCE
Resource Adequacy Capacity Confirmation
SCE – Silicon Valley Clean Energy
Authority
5 provided, if, using commercially reasonable efforts, Buyer is unable to acquire capacity having equivalent Capacity Attributes for any portion of any Showing Month, Buyer may replace such portion of the Replacement Obligation with capacity having Capacity Attributes in excess of the Contract Quantity (the “Replacement Capacity”). Buyer may enter into purchase transactions with one or more parties to purchase Replacement Capacity.
Additionally, Buyer may enter into one or more arrangements to repurchase its obligation to sell and deliver capacity to another party, and such arrangements shall be considered the procurement of Replacement Capacity.
Buyer shall act in a commercially reasonable manner to minimize damages in procuring any Replacement Capacity.
(b) Seller shall pay to Buyer at the time set forth in Section 4.1 of the Master Agreement, the following damages in lieu of damages specified in Section
4.1 of the Master Agreement: an amount equal to the positive difference, if any, between (i) the sum of (A) the actual cost paid by Buyer for any Replacement Capacity, including any transaction costs and expenses incurred in connection with such procurement, plus (B) each applicable Replacement Capacity Price multiplied by the aggregate amount of Replacement Obligation neither provided by Seller as Alternate Capacity nor purchased by Buyer as Replacement Capacity, for all applicable portions of the applicable Showing Month pursuant to Section 2.4(a), and (ii) the Replacement Obligation minus the Alternate Capacity, not provided for all applicable portions of the applicable Showing Month times the Contract Price for that month. Buyer’s invoice for such amount shall include a written statement explaining in reasonable detail the calculation of such amount and shall include supporting documentation.
2.5 Indemnities for Failure to Deliver Expected Contract Quantity 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 all or any of the following:
(a) Seller’s failure to provide any portion of the Expected Contract Quantity for any portion of the Delivery Period;
(b) Seller’s failure to provide a Showing Month Notice for any portion of the Delivery Period;
(c) Seller’s or the Unit’s SC’s failure to timely or accurately submit, or otherwise satisfy its Supply Plan Obligation for any portion of the Expected Contract Quantity or any portion of the Delivery Period; or
(d) any other failure by Seller to perform its obligations under this Confirmation.
DocuSign Envelope ID: A6C5F11A-511C-4FBB-8D4B-407304618012 DocuSign Envelope ID: 2A604A57-3AEC-4B87-B9B9-8482608E4B76 Appendix A SCE
Resource Adequacy Capacity Confirmation
SCE – Silicon Valley Clean Energy
Authority
6 With respect to the foregoing, the Parties shall use commercially reasonable efforts to minimize such penalties, fines, and costs.
2.6 Buyer’s Re-Sale of Product
Buyer may re-sell all or a portion of the Product and any associated rights, in each case, acquired under this Confirmation, in accordance with Applicable Laws and CPUC Decisions (“Resold Product”); provided, with respect to Resold Product that includes the sale of Capacity Attributes that impact Seller’s obligations under this Confirmation, Buyer agrees to: (a) notify Seller that such a sale has occurred; (b) provide Seller with the information described in Appendix E; and (c) notify Seller of any subsequent changes to the information in Appendix E with respect to any particular sale; in each case promptly following such sale and in no event later than the initial Compliance Showing Deadline for each Showing Month. Subject to Article 6 below, Seller agrees, and agrees to cause the Unit’s SC, to: (i) follow Buyer’s instructions with respect to providing such Resold Product to subsequent purchasers of such Resold Product; and (ii) take all commercially reasonable actions and execute any and all documents or instruments reasonably necessary to allow such subsequent purchasers to use such Resold Product.
Seller acknowledges and agrees that with respect to any Resold Product, if Buyer incurs any liability to any purchaser of such Resold Product due to the failure of Seller or the Unit’s SC to comply with the terms of this Confirmation, and Seller would have had liability to Buyer under this Confirmation for such failure had Buyer not sold the Resold Product to a subsequent purchaser, then Seller shall be liable to Buyer under this Confirmation, including without limitation, pursuant to Sections 2.4 and 2.5, for the amounts it would have been liable to Buyer for had such Resold Product not been sold to a subsequent purchaser. Buyer acknowledges and agrees that with respect to any Resold Product, if Seller incurs any liability to any purchaser of such Resold Product due to the failure of Buyer to comply with the terms of this Confirmation, and Buyer would have had liability to Seller under this Confirmation for such failure had Buyer not sold the Resold Product to a subsequent purchaser, then Buyer shall be liable to Seller under this Confirmation for the amounts it would have been liable to Seller for had such Resold Product not been sold to a subsequent purchaser.
2.7 CAISO Offer Requirements
Seller shall, or cause each Unit’s SC to, schedule with, or make available to, the CAISO the Expected Contract Quantity for each Unit in compliance with the CAISO Tariff, and shall, or shall cause each Unit’s SC, owner, or operator, as applicable, to perform all obligations under the CAISO Tariff that are associated with the sale and delivery of Product hereunder. Buyer shall have no liability for the failure of Seller or the failure of any Unit’s SC, owner, or operator to comply with such CAISO Tariff provisions, including any penalties, charges or fines imposed on Seller or such Unit’s SC, owner, or operator for such noncompliance.
DocuSign Envelope ID: A6C5F11A-511C-4FBB-8D4B-407304618012 DocuSign Envelope ID: 2A604A57-3AEC-4B87-B9B9-8482608E4B76 Appendix A SCE
Resource Adequacy Capacity Confirmation
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Authority
7 2.8 Unit SC’s Substitution Obligation
After the obligation to replace all or any portion of the Expected Contract Quantity transfers from the load serving entity to the Unit’s SC for a Showing Month in accordance with the CAISO Tariff, and if the CAISO determines that any portion of the Expected Contract Quantity for any portion of a Showing Month that was shown by Buyer in its Compliance Showings requires outage substitution in accordance with Section 40.9.3.6 of the CAISO Tariff because the Unit, or Alternate Unit, as applicable, is scheduled to take an outage (planned or otherwise) (such amount requiring outage substitution, the “SC Substitute Capacity”), then: (a) Seller shall have no liability under Sections 2.4 or 2.5 with respect to such SC Substitute Capacity; and (b) Seller shall have no liability to Buyer for any costs that are allocated to Buyer by the CAISO for any CPM Capacity procured by the CAISO pursuant to the Capacity Procurement Mechanism and that are related to such SC Substitute Capacity.
ARTICLE 3. PAYMENT
3.1 Monthly Payment
In accordance with the terms of Article Six of the Master Agreement, Buyer shall make a Monthly Payment to Seller, after the applicable Showing Month, as follows:
Monthly Payment = (A x B x 1,000)
where:
A = applicable Contract Price for that Showing Month.
B = The amount of Contract Quantity of Product actually delivered by Seller to Buyer pursuant to and consistent with Section 2.1 and, if applicable, Section 2.3, for the applicable Showing Month.
The Monthly Payment calculation shall be rounded to two decimal places.
3.2 Allocation of Other Payments and Costs
(a) Seller shall retain any revenues it may receive from and pay all costs charged by the CAISO or any other third party with respect to the Unit for (i) start-up, shutdown, and minimum load costs, (ii) energy sales, (iii) ancillary services, and (iv) black start or reactive power services.
(b) Buyer shall be entitled to receive and retain all revenues associated with the Contract Quantity (including any capacity revenues from RMR Contracts for the Unit, Capacity Procurement Mechanism or its successor, RUC Availability Payments, or its successor, but excluding payments described in Sections 3.2(a)(i)-(iv)). To the extent permitted by the CAISO Tariff, Seller
DocuSign Envelope ID: A6C5F11A-511C-4FBB-8D4B-407304618012 DocuSign Envelope ID: 2A604A57-3AEC-4B87-B9B9-8482608E4B76 Appendix A SCE
Resource Adequacy Capacity Confirmation
SCE – Silicon Valley Clean Energy
Authority
8 shall, or shall cause each Unit’s SC to, submit RUC Availability Bids for the Expected Contract Quantity for each Unit for each hour of the Delivery Period at a bid price of Zero Dollars ($0) per MW per hour, regardless of whether each Unit is shown on a Supply Plan for the applicable Showing Month. (c) In accordance with Section 3.1 of this Confirmation and Article Six of the Master Agreement,
(iii) all such Buyer revenues described in this Section 3.2, but received by Seller, or a Unit’s SC, owner, or operator shall be remitted to Buyer, and Seller shall pay such revenues to Buyer if the Unit’s SC, owner, or operator fails to remit those revenues to Buyer. If Seller fails to pay such revenues to Buyer, Buyer may offset any amounts owing to it for such revenues pursuant to Article Six of the Master Agreement against any future amounts Buyer may owe to Seller. In order to verify the accuracy of such revenues, Buyer shall have the right, at its sole expense and during normal working hours after reasonable prior notice, to hire an independent third party reasonably acceptable to Seller to audit any documents, records or data of Seller associated with the Contract Quantity; and
(iv) all such Seller, or a Unit’s SC, owner, or operator revenues described in this Section 3.2, but received by Buyer shall be remitted to Seller. If Buyer fails to pay such revenues to Seller, Seller may offset any amounts owing to it for such revenues pursuant to Article Six of the Master Agreement against any future amounts it may owe to Buyer. (d) If a centralized capacity market develops within the CAISO region, Buyer will have exclusive rights to offer, bid, or otherwise submit the applicable Contract Quantity of Product for each Showing Month provided to Buyer pursuant to this Confirmation for re-sale in such market, and retain and receive any and all related revenues.
(e) Seller agrees that the Unit is subject to the terms of the Availability Standards, Non-Availability Charges, and Availability Incentive Payments as contemplated under Section 40.9 of the CAISO Tariff. Furthermore, the Parties agree that any Availability Incentive Payments are for the benefit of the Seller and for Seller’s account and that any Non-Availability Charges are the responsibility of the Seller and for Seller’s account.
3.3 Offset Rights
Either Party may offset any amounts owing to it for revenues, penalties, fines, costs reimbursement, or other payments pursuant to Article Six of the Master Agreement against any future amounts it may owe to the other Party.
DocuSign Envelope ID: A6C5F11A-511C-4FBB-8D4B-407304618012 DocuSign Envelope ID: 2A604A57-3AEC-4B87-B9B9-8482608E4B76 Appendix A SCE
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Authority
9 ARTICLE 4. OTHER BUYER AND SELLER COVENANTS
4.1 Seller’s and Buyer’s Duty to Take Action to Allow the Utilization of the Product
Buyer and Seller shall, throughout the Delivery Period: (a) cause the Benefiting Load Serving Entity SCID to be included in all applicable Supply Plans; (b) execute any and all documents or instruments reasonably necessary to ensure Buyer’s right to the use of the Contract Quantity for the sole benefit of Buyer or any subsequent purchaser under Section 2.6; and (c) cause all Supply Plans to be filed in conformance with the requirements of the CPUC Filing Guide and the CAISO Tariff. If during the Delivery Period, there is a change to the Benefiting Load Serving Entity SCID, the Parties agree to communicate such changes to each other promptly. The Parties further agree to negotiate in good faith to make necessary amendments, if any, to this Confirmation to conform this Transaction to subsequent clarifications, revisions, or decisions rendered by the CPUC, FERC, CAISO or other Governmental Authority having jurisdiction to administer Compliance Obligations, so as to maintain the benefits of the bargain struck by the Parties on the Confirmation Effective Date.
4.2 Seller’s Representations, Warranties and Covenants
(a) Seller represents, warrants and covenants to Buyer that, throughout the Delivery Period:
(i) Seller owns or has the exclusive right to the Product sold under this Confirmation from the Unit, and shall furnish Buyer, CAISO, CPUC or other Governmental Authority with such evidence as may reasonably be requested to demonstrate such ownership or exclusive right; (ii) No portion of the Contract Quantity has been committed by Seller to any third party in order to satisfy Compliance Obligations or analogous obligations in any CAISO or non-CAISO markets, other than pursuant to an RMR Contract between the CAISO and either Seller or the Unit’s owner or operator;
(iii) Seller shall comply with Applicable Laws relating to the Product; (iv) (A) 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 the CAISO) notify Buyer in the event the CAISO designates any portion of the Contract Quantity as CPM Capacity and (B) in the event the CAISO makes such a designation Seller shall, and shall cause the Unit’s SC to not accept any such designation by the CAISO unless and until Buyer has agreed to accept such designation; (v) Buyer shall have the exclusive right to offer the Contract Quantity, or
DocuSign Envelope ID: A6C5F11A-511C-4FBB-8D4B-407304618012 DocuSign Envelope ID: 2A604A57-3AEC-4B87-B9B9-8482608E4B76 Appendix A SCE
Resource Adequacy Capacity Confirmation
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10 any portion thereof, to the CAISO as CPM Capacity and Seller shall not, and shall cause the Unit’s SC not to, offer any portion of the Contract Quantity to the CAISO as CPM Capacity or accept any designation of any portion thereof as CPM Capacity;
(vi) The Unit is connected to the CAISO Controlled Grid, is within the CAISO Control Area, and is under the control of CAISO;
(vii) Seller shall cause the Unit’s SC, owner and operator to comply with Applicable Laws relating to the Product;
(viii) Buyer shall have no liability for the failure of Seller or the failure of the Unit’s SC, owner, or operator to comply with such CAISO Tariff provisions, including any penalties, charges or fines imposed on Seller or the Unit’s SC, owner, or operator for such noncompliance. (ix) If Seller is the owner of the Unit, the aggregation of all amounts of Capacity Attributes that Seller has sold, assigned or transferred for the Unit does not exceed the Unit NQC or Unit EFC for that Unit; (x) Seller has notified the SC of the Unit that Seller has transferred the Contract Quantity, including the amount of Flexible Capacity and Inflexible Capacity, to the extent applicable, with respect to each Showing Month to Buyer, and the SC is obligated to deliver the Supply Plans in accordance with the CAISO Tariff and this Confirmation; (xi) Seller has notified the SC of the Unit that Seller is obligated to cause the Unit’s SC to provide to the Buyer, on or prior to the Compliance Notification Deadline, the applicable Expected Contract Quantity of the Unit for such Showing Month, including the amount of Flexible Capacity and Inflexible Capacity, to the extent applicable, that is to be submitted in the Supply Plan associated with this Agreement for the applicable period; and
(xii) Seller has notified the Unit’s SC that Buyer is entitled to the revenues set forth in Section 3.2, and such SC is obligated to promptly deliver those revenues to Buyer, along with appropriate documentation supporting the amount of those revenues.
(b) Seller represents, warrants and covenants to Buyer that, as of the Confirmation Effective Date, all of the information set forth on Appendix C hereto is true, correct and complete.
ARTICLE 5. CONFIDENTIALITY
Notwithstanding Section 10.11 of the Master Agreement, the Parties agree that: (i) Buyer may disclose the Contract Quantity or any applicable portion of the Contract Quantity,
DocuSign Envelope ID: A6C5F11A-511C-4FBB-8D4B-407304618012 DocuSign Envelope ID: 2A604A57-3AEC-4B87-B9B9-8482608E4B76 Appendix A SCE
Resource Adequacy Capacity Confirmation
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11 including any amounts of Flexible Capacity and Inflexible Capacity, to the extent applicable, under this Transaction to any Governmental Authority, the CPUC, the CAISO in order to support its Compliance Showings, if applicable; (ii) Seller may disclose the transfer of the Contract Quantity and the applicable Expected Contract Quantity (as well as any amounts of Flexible Capacity and Inflexible Capacity, to the extent applicable) for each Showing Month under this Transaction to the SC of the Unit in order for such SC to timely submit accurate Supply Plans; (iii) both Parties may disclose the terms and conditions of the Agreement and any and all written or recorded or oral information, data, analyses, documents, and materials furnished or made available by a Party to the other Party in connection with this Agreement to the Independent Evaluator; and (iv) Buyer and the Independent Evaluator may disclose the terms and conditions of the Agreement and any and all written or recorded or oral information, data, analyses, documents, and materials furnished or made available by a Party to the other Party in connection with this Agreement to the CAISO, the CPUC, and all divisions thereof, the California Energy Commission, and participants of the Procurement Review Group established pursuant to D.02-08-071 and D.03-06-071; provided, that each disclosing Party shall use reasonable efforts to limit, to the extent possible, the ability of any such applicable Governmental Authority, CAISO, or SC to further disclose such information. In addition, in the event Buyer resells all or any portion of the Contract Quantity to another party, Buyer shall be permitted to disclose to the other party to such resale transaction all such information necessary to effect such resale transaction.
ARTICLE 6. HOLDBACK
No later than five (5) Business Days before the deadline for the initial Compliance Showing Deadline with respect to a particular Showing Month, Buyer may request that Seller not list, or cause the Unit’s SC not to list, a portion or all of a Unit’s applicable Expected Contract Quantity for any portion(s) of such Showing Month on the Supply Plan. The amount of Expected Contract Quantity that is the subject of such a request shall be deemed Expected Contract Quantity provided consistent with Section 2.1 for purposes of calculating a Monthly Payment pursuant to Section 3.1 and calculating any amounts due pursuant to Section 2.4 or 2.5. Seller shall, or shall cause the Unit’s SC to, comply with Buyer’s request under this Article 6.
ARTICLE 7. MARKET BASED RATE AUTHORITY
Seller agrees, in accordance with FERC Order No. 697, to, upon request of Buyer, 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 § 35.42.
Seller also agrees that it will not, in any filings, if any, made subject to FERC Order Nos. 652 and 697, claim that this contractual arrangement conveys ownership or control of generation capacity from Seller to Buyer.
DocuSign Envelope ID: A6C5F11A-511C-4FBB-8D4B-407304618012 DocuSign Envelope ID: 2A604A57-3AEC-4B87-B9B9-8482608E4B76 Appendix A SCE
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12 ARTICLE 8. COLLATERAL REQUIREMENTS
8.1 Counterparty Collateral Requirements
Notwithstanding anything to the contrary contained in the EEI Agreement, Counterparty shall have a Full Floating Independent Amount if Counterparty or its Guarantor, if any, does not maintain Credit Ratings of at least (a) BBB- from S&P and Baa3 from Moody’s, if such entity is rated by the Ratings Agencies, or (b) BBB- by S&P or Baa3 by Moody’s if such entity is rated by only one Ratings Agency. The Full Floating Independent Amount shall equal the value set forth in Appendix B of this Confirmation. Commencing after the initial Compliance Showing Deadline of the first Showing Month of the Delivery Period, and for each initial Compliance Showing Deadline during the Delivery Period thereafter, the Full Floating Independent Amount shall be reduced to twenty percent (20%) of the sum of the FFIA Monthly Payments for the Next Showing Month and all remaining months of the Delivery Period. For the purposes of calculating the Collateral Requirement pursuant to Paragraph 3 of the Collateral Annex, the Full Floating Independent Amount for Counterparty shall be added to the Exposure Amount for SCE and subtracted from the Exposure Amount for Counterparty.
For the purposes of calculating Exposure, the Monthly Payment shall be deemed accrued and payable upon the initial Compliance Showing Deadline for the applicable Showing Month.
8.2 Current Mark-To-Market Value
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. If at any time prior to the expiration of the Delivery Period, a liquid market for a resource adequacy Capacity product develops wherein price quotes for such a product can be obtained, the Parties agree to amend the Confirmation to include a methodology for calculating the Current Mark-to-Market Value for this Transaction.
8.3 Credit Terms
The Parties agree that the credit and collateral provisions of the EEI Agreement shall govern this Transaction; provided, however, that for purposes of calculating a Party’s Collateral Requirement pursuant to Paragraph 3 of the Collateral Annex, with respect to this Transaction only (a) if Counterparty has Exposure to SCE, then the amount of Exposure for this Transaction is deemed to be zero dollars ($0), and (b) in no event shall SCE be required to post or maintain an Independent Amount with Counterparty.
DocuSign Envelope ID: A6C5F11A-511C-4FBB-8D4B-407304618012 DocuSign Envelope ID: 2A604A57-3AEC-4B87-B9B9-8482608E4B76 Appendix A SCE
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13 ARTICLE 9. OTHER
9.1 Declaration of an Early Termination Date and Calculation of Settlement Amounts
The Parties shall determine the Settlement Amount for this Transaction in accordance with Section 5.2 of the Master Agreement, provided that, with respect to this Transaction only, the following language is added at the end of Section 5.2 of the Master Agreement, with any terms which are defined in this Confirmation being used in the Master Agreement with the definitions given to such terms in this Confirmation:
“If Buyer is the Non-Defaulting Party and Buyer reasonably expects to incur penalties, fines or costs from the CPUC, the CAISO, or any Governmental Authority having jurisdiction, because Buyer is not able to include the applicable Contract Quantity in any applicable Compliance Showing due to Seller’s Event of Default, then Buyer may, in good faith, estimate the amount of those penalties or fines and include this estimate in its determination of the Settlement Amount, subject to accounting to Seller when those penalties or fines are finally ascertained. If this accounting establishes that Buyer’s estimate exceeds the actual amount of penalties or fines, Buyer shall promptly remit to Seller the excess amount. The rights and obligations with respect to determining and paying any Settlement Amount or Termination Payment, and any dispute resolution provisions with respect thereto, shall survive the termination of this Transaction and shall continue until after those penalties or fines are finally ascertained.”
9.2 No Waiver
The failure of either Party to insist in any one instance upon strict performance of any the provisions of this Agreement or to take advantage of any of its rights hereunder shall not be construed as a waiver of any such provisions or the relinquishments of such rights for the future, but the same shall continue and remain in full force and effect. Waiver by either Party of any default of the other Party shall not be deemed a waiver of any other default. Waiver by either Party of any failure to comply with any timeline or deadline by the other Party as provided herein in any instance, shall not be deemed a waiver of any failure to comply with such timeline or deadline in the future, or otherwise establish a course of performance. [Remainder of Page Intentionally Left Blank]
DocuSign Envelope ID: A6C5F11A-511C-4FBB-8D4B-407304618012 DocuSign Envelope ID: 2A604A57-3AEC-4B87-B9B9-8482608E4B76 Appendix A SCE
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14 In WITNESS WHEREOF, the Parties have caused this Confirmation to be duly executed as of the Confirmation Effective Date first written:
SILICON VALLEY CLEAN ENERGY
AUTHORITY,
a California joint powers authority.
SOUTHERN CALIFORNIA EDISON
COMPANY,
a California corporation.
By: By:
Name: Girish Balachandran Name: Constantine Louie
Title: Chief Executive Officer
Date:
Title: Senior Manager, Energy Trading .
Date:
DocuSign Envelope ID: A6C5F11A-511C-4FBB-8D4B-407304618012 6/2/2023
DocuSign Envelope ID: 2A604A57-3AEC-4B87-B9B9-8482608E4B76 Appendix A SCE
x DocuSigned by:
5CA64B9AO4C24C3...
x DocuSigned by:
Z—OlMC
39t&64-&607084BF77
Resource Adequacy Capacity Confirmation
SCE – Silicon Valley Clean Energy
Authority
15 APPENDIX A
DEFINED TERMS
“Agreement” has the meaning specified in the introductory paragraph of this Confirmation.
“Alternate Capacity” means Product which Seller has elected to provide to Buyer in accordance with the terms of Section 2.3.
“Alternate Unit” means a generating unit meeting the requirements specified in Section
2.3. “Annual Supply Plan” has the meaning set forth in the CAISO Tariff. “Applicable Laws” means the CAISO Tariff and all constitutions, treaties, laws, ordinances, rules, regulations, interpretations, permits, judgments, decrees, injunctions, writs and orders of any Governmental Authority that apply to either or both of the Parties, the Project, the Unit or the terms of this Agreement.
“Availability Incentive Payments” has the meaning set forth in the CAISO Tariff. “Availability Standards” has the meaning set forth in the CAISO Tariff. “Benefiting Load Serving Entity SCID” is as specified in Appendix D. “Buyer” has the meaning specified in Appendix B.
“CAISO” means the California Independent System Operator Corporation, or any successor entity performing the same functions.
“CAISO Control Area” has the meaning set forth in the CAISO Tariff. “CAISO Controlled Grid” has the meaning as set forth in the CAISO Tariff. “CAISO Tariff” means the California Independent System Operator Corporation Tariff, Business Practice Manuals (BPMs), Operating Agreements, and Operating Procedures, including the rules, protocols, procedures and standards attached thereto, as the same may be amended or modified from time to time and approved by FERC, if applicable. “Capacity Attributes” means, with respect to a Unit, any and all of the following, in each case which are attributed to or associated with the Unit at any time throughout the Delivery Period:
(a) resource adequacy attributes, as may be identified from time to time by the CPUC, CAISO, or other Governmental Authority having jurisdiction, that can be counted toward RAR;
DocuSign Envelope ID: A6C5F11A-511C-4FBB-8D4B-407304618012 DocuSign Envelope ID: 2A604A57-3AEC-4B87-B9B9-8482608E4B76 Appendix A SCE
Resource Adequacy Capacity Confirmation
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Authority
16 (b) resource adequacy attributes or other locational attributes for the Unit related to a Local Capacity Area, as may be identified from time to time by the CPUC, CAISO or other Governmental Authority having jurisdiction, associated with the physical location or point of electrical interconnection of the Unit within the CAISO Control Area, that can be counted toward a Local RAR; and (c) other current or future defined characteristics, certificates, tags, credits, or accounting constructs, howsoever entitled, including any accounting construct counted toward any Compliance Obligation;
provided that, notwithstanding the foregoing, Capacity Attributes shall exclude all flexible capacity resource adequacy attributes, characteristics, certificates, tags, credits, or accounting constructs, howsoever entitled associated with the Unit; provided further, notwithstanding the foregoing, Capacity Attributes shall exclude intra-month substitution resource adequacy attributes.
“Capacity Procurement Mechanism” has the meaning set forth in the CAISO Tariff. “Collateral Annex” has the meaning specified in the introductory paragraph of this Confirmation.
“Compliance Notification Deadline” means, for each Showing Month, fifteen (15) Business Days before the Compliance Showing Deadline.
“Compliance Obligations” means the RAR and Local RAR.
“Compliance Showings” means the (a) Local RAR compliance or advisory showings (or similar or successor showings) and (b) RAR compliance or advisory showings (or similar or successor showings), in each case, a load serving entity is required to make to the CPUC (and, to the extent authorized by the CPUC, to the CAISO) pursuant to the CPUC Decisions, to the CAISO pursuant to the CAISO Tariff, or to any Governmental Authority having jurisdiction.
“Compliance Showing Deadline” means, for each Showing Month, the Compliance Showing plan submission due date for such Showing Month. For illustrative purposes only, as of the Confirmation Effective Date, the applicable Compliance Showing plan submission due dates are as follows: (A) forty-five (45) days prior to the Showing Month covered by the Supply Plan for the Monthly Supply Plan; and (B) the last Business Day of October that is prior to commencement of the year for the Annual Supply Plan, such dates may be modified by the CAISO from time to time throughout the Term. “Confirmation” has the meaning specified in the introductory paragraph of this Confirmation.
“Confirmation Effective Date” has the meaning specified in the introductory paragraph of this Confirmation.
DocuSign Envelope ID: A6C5F11A-511C-4FBB-8D4B-407304618012 DocuSign Envelope ID: 2A604A57-3AEC-4B87-B9B9-8482608E4B76 Appendix A SCE
Resource Adequacy Capacity Confirmation
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17 “Contract Price” means, for any Showing Month, the price specified in Appendix B under the column titled “Contract Price” for such Showing Month. “Contract Quantity” means, with respect to any particular Showing Month of the Delivery Period, the amount of Product associated with the number of MWs set forth in Appendix B under the column titled “Contract Quantity”, which Seller has agreed to provide to Buyer from the Unit for each Showing Month.
“Contract Quantity Unit Allocation” means, if Seller is delivering Product to Buyer from more than one Unit, the allocation of Contract Quantity Seller will deliver from each Unit, as set forth in Appendix C and as modified by Seller from time to time in accordance with Section 2.1(c).
“Cover Sheet” has the meaning specified in the introductory paragraph of this Confirmation.
“CPM Capacity” has the meaning set forth in the CAISO Tariff. “CPUC” means the California Public Utilities Commission. “CPUC Decisions” 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, and any other existing or subsequent decisions, resolutions, or rulings related to resource adequacy, including, without limitation, the CPUC Filing Guide, in each case as may be amended from time to time by the CPUC. “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.
“Current Mark-to-Market Value” has the meaning specified in Section 8.2 “Delivery Period” has the meaning specified in Section 1.3(a). “EEI” has the meaning specified in the introductory paragraph of this Confirmation. “EEI Agreement” has the meaning specified in the introductory paragraph of this Confirmation.
“Expected Contract Quantity” means, with respect to any Showing Month of the Delivery Period, 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, and after giving effect to any reductions to Contract Quantity as specified in Section 2.2 with respect to which Seller has not elected to provide Alternate Capacity. “FFIA Monthly Payment” shall be the Monthly Payment calculated using the Contract Quantity rather than the Expected Contract Quantity, such that variable B in the formula
DocuSign Envelope ID: A6C5F11A-511C-4FBB-8D4B-407304618012 DocuSign Envelope ID: 2A604A57-3AEC-4B87-B9B9-8482608E4B76 Appendix A SCE
Resource Adequacy Capacity Confirmation
SCE – Silicon Valley Clean Energy
Authority
18 for Monthly Payment shall be as follows: B = the Contract Quantity of Product for each applicable Showing Month.
“Governmental Authority” means any: (a) federal, state, local, municipal or other government; (b) 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 (c) court or governmental tribunal.
“Independent Evaluator” has the meaning set forth in CPUC Decision 04-12-048. “Local Capacity Area” has the meaning set forth in the CAISO Tariff. “Local RAR” means the local resource adequacy requirements established for load serving entities by the CPUC pursuant to the CPUC Decisions, the CAISO pursuant to the CAISO Tariff, or by any other Governmental Authority having jurisdiction. Local RAR may also be known as local area reliability, local resource adequacy, local resource adequacy procurement requirements, or local capacity requirement in other regulatory proceedings or legislative actions.
“Maintenance Outage” has the meaning set forth in the CAISO Tariff. “Master Agreement” has the meaning specified in the introductory paragraph of this Confirmation.
“Monthly Payment” has the meaning specified in Section 3.1. “Monthly Supply Plan” has the meaning set forth in the CAISO Tariff. “MW” means megawatt (or 1,000 kilowatts) of alternating current electric energy generating capacity.
“Net Qualifying Capacity” has the meaning set forth in the CAISO Tariff. “Next Showing Month” means the next calendar month for which a Compliance Showing will be made.
“Non-Availability Charges” has the meaning set forth in the CAISO Tariff. “Planned Outage” means a maintenance outage taken by the Unit originally identified in Appendix C, as such maintenance outage is determined by the applicable Unit or Unit SC.
“Product” means the Capacity Attributes of the Unit(s), including any capacity from RMR Contracts for the applicable Unit, or its successor, Capacity Procurement Mechanism, or its successor, and RUC Availability Payments, or its successor; provided that:
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Resource Adequacy Capacity Confirmation
SCE – Silicon Valley Clean Energy
Authority
19 (a) Product does not include any right to the energy or ancillary services from the Unit;
(b) any change by the CAISO, CPUC or other Governmental Authority that defines new or re-defines existing Local Capacity Areas that results in a decrease or increase in the amount of Capacity Attributes related to a Local Capacity Area provided hereunder will not result in a change in payments made pursuant to this Transaction; and
(c) the Parties agree that, under this Confirmation, if the CAISO”, CPUC or other Governmental Authority defines new or re-defines existing Local Capacity Areas whereby the Unit subsequently qualifies for a Local Capacity Area, the Product shall include all Capacity Attributes related to such Local Capacity Area.
“RAR” means the resource adequacy requirements established for load serving entities by the CPUC pursuant to the CPUC Decisions, the CAISO pursuant to the CAISO Tariff, or by any other Governmental Authority having jurisdiction. “Replacement Capacity” has the meaning specified in Section 2.4. “Replacement Capacity Price” means the market price for Product with Capacity Attributes reasonably equivalent to the quantity of Product not provided by Seller under this Confirmation, as determined in the manner upon which market prices are determined under Section 5.2(b) of the Master Agreement. For purposes of this Transaction and Confirmation, the “Replacement Capacity Price” shall be deemed to be the “Replacement Price” as defined in Section 1.51 of the Master Agreement. “Replacement Obligation” has the meaning specified in Section 2.4. “Resold Product” has the meaning specified in Section 2.6. “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. “RMR Contracts” has the meaning set forth in the CAISO Tariff. “RUC Availability Bid” has the meaning set forth in the CAISO Tariff. “RUC Availability Payment” has the meaning set forth in the CAISO Tariff. “SC” has the meaning set forth in the CAISO Tariff.
“SC Substitute Capacity” has the meaning set forth in Section 2.8. “Seller” has the meaning specified in Appendix B.
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Resource Adequacy Capacity Confirmation
SCE – Silicon Valley Clean Energy
Authority
20 “Showing Month” shall be the calendar month of the Delivery Period that is the subject of the Compliance Showing, as set forth in the CPUC Decisions and outlined in the CAISO Tariff. For illustrative purposes only, pursuant to the CAISO Tariff and CPUC Decisions in effect as of the Confirmation Effective Date, the monthly Compliance Showing made in June is for the Showing Month of August. “Showing Month Notice” has the meaning specified in Section 2.1(b). “Supply Plan” has the meaning set forth in the CAISO Tariff. “Supply Plan Obligation” has the meaning specified in Section 2.1(a). “Term” has the meaning specified in Section 1.3(b).
“Unit” shall mean the generation assets described in Appendix C (including any Alternate Units), from which Product is provided by Seller to Buyer. “Unit NQC” means the Net Qualifying Capacity set by the CAISO for the applicable Unit. The Parties agree that 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.
DocuSign Envelope ID: A6C5F11A-511C-4FBB-8D4B-407304618012 DocuSign Envelope ID: 2A604A57-3AEC-4B87-B9B9-8482608E4B76 Appendix A SCE
Resource Adequacy Capacity Confirmation
SCE – Silicon Valley Clean Energy
Authority
21 ADDITIONAL DEFINED TERMS
To the extent that the Parties have selected Flexible Capacity as being “Applicable”, the following definitions shall be utilized in lieu of the corresponding definition, where appropriate, or in addition to the definitions set forth in the above Defined Terms:
“Capacity Attributes” means, with respect to a Unit, any and all of the following, in each case which are attributed to or associated with the Unit at any time throughout the Delivery Period:
(a) resource adequacy attributes, as may be identified from time to time by the CPUC, CAISO, or other Governmental Authority having jurisdiction, that can be counted toward RAR;
(b) resource adequacy attributes or other locational attributes for the Unit related to a Local Capacity Area, as may be identified from time to time by the CPUC, CAISO or other Governmental Authority having jurisdiction, associated with the physical location or point of electrical interconnection of the Unit within the CAISO Control Area, that can be counted toward a Local RAR; (c) other current or future defined characteristics, certificates, tags, credits, or accounting constructs, howsoever entitled, including any accounting construct counted toward any Compliance Obligations; and
(d) flexible capacity resource adequacy attributes for the Unit, including, without limitation, the amount of Unit EFC and MWs associated with Unit EFC as may be identified from time to time by the CPUC, CAISO, or other Governmental Authority having jurisdiction, that can be counted toward Flexible RAR; provided, notwithstanding the foregoing, Capacity Attributes shall exclude intra-month substitution resource adequacy attributes. “Compliance Obligations” means the RAR, Local RAR and Flexible RAR. “Compliance Showings” 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, a load serving entity is required to make to the CPUC (and, to the extent authorized by the CPUC, to the CAISO) pursuant to the CPUC Decisions, to the CAISO pursuant to the CAISO Tariff, or to any Governmental Authority having jurisdiction. “Contract Quantity” means, with respect to any particular Showing Month of the Delivery Period, the amount of Product associated with the number of MWs set forth in Appendix B under the column titled “Contract Quantity”, which Seller has agreed to provide to Buyer from the Unit for each Showing Month, and which includes
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Resource Adequacy Capacity Confirmation
SCE – Silicon Valley Clean Energy
Authority
22 Product which is Flexible Capacity in an amount equal to the amount identified in Appendix B. All Contract Quantity is Inflexible Capacity except to the extent identified as Flexible Capacity Appendix C.
“Effective Flexible Capacity” has the meaning set forth in the CAISO Tariff. “Flexible Capacity” means, with respect to any particular Showing Month of the Delivery Period, the number of MWs of Product set forth in Appendix B under the column titled “Flexible Capacity” which Seller has agreed to provide to Buyer from the Unit as part of the Contract Quantity for such Showing Month, and which such MWs of Product are eligible to satisfy a load serving entity’s Flexible RAR and which such MWs of Product are associated with MWs of the Unit that are part of the Unit EFC.
“Flexible RAR” means the flexible capacity requirements established for load serving entities by the CPUC pursuant to the CPUC Decisions, the CAISO pursuant to the CAISO Tariff, or by any other Governmental Authority having jurisdiction and includes any non-binding advisory showings which a load serving entity is to make with respect to flexible capacity.
“Inflexible Capacity” means, with respect to any particular Showing Month of the Delivery Period, the number of MWs of Product set forth in Appendix B under the column titled “Contract Quantity”, minus the number of MWs of Product set forth in Appendix B under the column titled “Flexible Capacity”, which Seller has agreed to provide to Buyer from the Unit as part of the Contract Quantity for such Showing Month, and which such MWs of Product are not eligible to satisfy a load serving entity’s Flexible RAR and which are Product associated MWs of the Unit that are not part of or outside the Unit EFC. Inflexible Capacity is also known as ‘generic capacity’.
“Product” means the Capacity Attributes of the Unit, provided that:
(a) Product does not include any right to the energy or ancillary services from the Unit;
(b) any change by the CAISO, CPUC or other Governmental Authority that defines new or re-defines existing Local Capacity Areas that results in a decrease or increase in the amount of Capacity Attributes related to a Local Capacity Area provided hereunder will not result in a change in payments made pursuant to this Transaction;
(c) any change by the CAISO, CPUC or other Governmental Authority that defines new or re-defines existing Flexible RAR, Capacity Attributes related to Flexible RAR, or attributes of the Unit related to Flexible RAR, that results in a decrease or increase in the amount of Capacity Attributes related to Flexible RAR
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Resource Adequacy Capacity Confirmation
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Authority
23 provided hereunder will not result in a change in payments made pursuant to this Transaction;
(d) the Parties agree that, under this Confirmation, if the CAISO, CPUC or other Governmental Authority defines new or re-defines existing Local Capacity Areas whereby the Unit subsequently qualifies for a Local Capacity Area, the Product shall include all Capacity Attributes related to such Local Capacity Area; and
(e) the Parties agree that, under this Confirmation, if the CAISO, CPUC or other Governmental Authority defines new or re-defines existing Flexible RAR, Capacity Attributes related to Flexible RAR, or attributes of the Unit related to Flexible RAR whereby the Unit, or a portion of the Unit which did not previously qualify to satisfy Flexible RAR, subsequently qualifies to satisfy Flexible RAR, the Product shall include all Capacity Attributes of the Unit related to Flexible RAR, including any Capacity Attributes related to Flexible RAR with respect to any portion of the Unit which previously was not able to satisfy Flexible RAR.
“Unit EFC” means the Effective Flexible Capacity (in MWs) of the Unit. The Parties agree that if the CAISO adjusts the Effective Flexible Capacity of a Unit after the Confirmation Effective Date, then for the period in which the adjustment is effective, the Unit EFC shall be deemed the lesser of (i) the Unit EFC as of the Confirmation Effective Date, or (ii) the CAISO-adjusted Effective Flexible Capacity. “Unit EFC Category” shall be as described in the annual CPUC Filing Guide, as such may be modified, amended, supplemented or updated from time to time.
DocuSign Envelope ID: A6C5F11A-511C-4FBB-8D4B-407304618012 DocuSign Envelope ID: 2A604A57-3AEC-4B87-B9B9-8482608E4B76 Appendix A SCE
Resource Adequacy Capacity Confirmation
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Authority
24 APPENDIX B
FLEXIBLE CAPACITY, DELIVERY PERIOD, CONTRACT QUANTITY,
CONTRACT PRICE, AND FULL FLOATING INDEPENDENT AMOUNT
The quantities specified in this table will control in the event of a conflict between these values and those in Appendix C. The Parties agree to revise the Appendix C as necessary to ensure that the Contract Quantity and Flexible Capacity are satisfied in full.
Buyer Silicon Valley Clean Energy Authority
Seller Southern California Edison Company
Flexible Capacity Applicable Not applicable
Delivery Period
Showing Month Year
Contract
Quantity (MW)
Flexible
Capacity (MW)
Contract Price
($/kW-month)
Full Floating Independent Amount
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Resource Adequacy Capacity Confirmation
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25 APPENDIX C
UNIT INFORMATION AND CONTRACT QUANTITY UNIT ALLOCATION
Unit 1 Information
Unit 1
CAISO Resource ID BUCKBL_2_PL1X3
Unit Name Blythe Energy Center
Current Scheduling Coordinator SCID LSCE
Resource Fuel Type Gas
Resource Category (1, 2, 3 or 4) 4
Unit EFC Category (1, 2, 3 or N/A) N/A
Local Capacity Area (if applicable, as of
Confirmation Effective Date)
CAISO System
Unit 1 Contract Quantity Unit Allocation
Unit
NQC (1)
Unit
EFC (2)
2023
Contract
Quantity
2023
Flexible
Capacity
(1) Unit NQC (Net Qualifying Capacity in MW as of the Confirmation Effective Date) (2) If Flexible Capacity is designated as applicable in Section 1.1, Unit EFC (Effective Flexible Capacity in MW, as of the Confirmation Effective Date)
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Resource Adequacy Capacity Confirmation
SCE – Silicon Valley Clean Energy
Authority
26 APPENDIX D
SUPPLY PLAN INFORMATION
Benefitting load serving entity SCID: LSVCE
Counterparty Supply Plan contact information:
SCE Supply Plan contact information1
:
1. SCE Contract Manager must also be included on all communications.
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Resource Adequacy Capacity Confirmation
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27 APPENDIX E
SUBSEQUENT SALE INFORMATION
Contract Key ID:
Subsequent sale contract quantity
(in MW):
Subsequent sale delivery period:
Amount of Inflexible Capacity
included in subsequent sale contract
quantity (in MW):
New benefitting load serving entity
SC identification number:
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1 IMPORT CAPABILITY TRANSFER
CONFIRMATION LETTER
BETWEEN
SONOMA CLEAN POWER AUTHORITY
AND
SILICON VALLEY CLEAN ENERGY
This confirmation letter including all appendices hereto (“Confirmation”) confirms the transaction between Sonoma Clean Power Authority, a California joint powers authority (“Seller”) and Silicon Valley Clean Energy, a California joint powers authority (“Buyer”), each individually a “Party” and together the “Parties”, dated as of June 2, 2023 (the “Confirmation Effective Date”) in which Seller agrees to provide to Buyer the right to the Product, as such term is defined in this Confirmation, in the amounts described in this Confirmation (the “Transaction”). This Confirmation is governed by the terms and conditions of the WSPP Agreement effective as of August 26, 2022, along with any schedules and amendments thereto (collectively, the “Master Agreement”). The Master Agreement and this Confirmation shall be collectively referred to herein as the “Agreement.” If there is any conflict between the terms set forth in this Confirmation and the Master Agreement, the terms set forth in this Confirmation shall govern. Capitalized terms not otherwise defined in this Confirmation have the meanings ascribed to them in the Master Agreement or the Tariff (defined herein below).
ARTICLE 1
TRANSACTION
1.1 Product
Seller shall sell and transfer to Buyer, and Buyer shall purchase and receive from Seller, the Remaining Import Capability (the “Product”), at the Delivery Points in the amount of the Contract Quantity at the Contract Price for the Delivery Period.
1.2 Delivery Period and Term
(a) Delivery Period. The Delivery Period is
inclusive, unless terminated earlier in accordance with the terms of this Agreement. (b) Term. The Term of this Transaction shall commence upon the Confirmation Effective Date and shall continue until the later of (i) the expiration of the Delivery Period or (ii) the date that the Parties’ obligations under this Confirmation have been satisfied. This Confirmation shall be effective and binding as of the Confirmation Effective Date.
1.3 Contract Quantity, Contract Price, and Delivery Point For the Delivery Period, Seller shall transfer the Product to Buyer in the amount as follows (the “Contract Quantity”), at the Contract Price, and for the following Delivery Points as specified in the Contract Quantity Table below:
DocuSign Envelope ID: 2F2070FC-B57A-4160-9F0C-7A9DC1C3A350 DocuSign Envelope ID: 22BB737C-4911-4B05-93E0-CFE2640FF06B DocuSign Envelope ID: 89776608-DF7F-450F-BB9F-6DE1423CC8E9 Appendix A SCP
2 Delivery Period Delivery Point Contract Quantity
(MWs)
Contract Price
($/kW-month)
ARTICLE 2
DELIVERY OBLIGATIONS
2.1 Delivery
Within three (3) Business Days from the Confirmation Effective Date, Seller shall transfer the Product to Buyer by registering the transfer with CAISO as a Bilateral Import Capability Transfer in the amount of the Contract Quantity for the applicable Contract Month, and completing any other action or documentation required by the CAISO to affect such transfer (the “Registration”).
As soon as reasonably practicable thereafter, but no later than three (3) Business Days from Registration, Buyer shall accept and confirm Seller’s Registration in CAISO’s CIRA Tool and Buyer will then communicate to Seller by email as to whether the transfer from Seller to Buyer of the Product in the amount of the Contract Quantity at the Delivery Point was successful or unsuccessful. If the transfer from Seller to Buyer of the Product in the amount of the Contract Quantity at the Delivery Point is unsuccessful, the Parties shall begin the registration process set forth in this Section 2.1 again, until such time as the transfer is completed successfully.
2.2 Buyer’s Re-Sale of Product
Buyer may re-sell all or a portion of the Product acquired under this Confirmation.
ARTICLE 3
PAYMENT
3.1 One-Time Payment
Buyer shall make a One-Time Payment to Seller for the Product within ten (10) Business Days after the later of: (a) Buyer’s receipt of the Product; or (b) receipt of Seller’s invoice.
The One-Time Payment is calculated as follows:
One-Time Payment = ∑n (Ai × Bi × 1,000)
𝑖
where:
A = Contract Price (in $/kW-month) for Contract Month i B = Contract Quantity (in MW) transferred by Seller for Contract Month i = Each Contract Month
n = number of Contract Months
DocuSign Envelope ID: 2F2070FC-B57A-4160-9F0C-7A9DC1C3A350 DocuSign Envelope ID: 22BB737C-4911-4B05-93E0-CFE2640FF06B DocuSign Envelope ID: 89776608-DF7F-450F-BB9F-6DE1423CC8E9 Appendix A SCP
3 The One-Time Payment calculation shall be rounded to two decimal places.
3.2 Offset Rights
Either Party may offset any amounts owing to it for revenues, penalties, fines, costs reimbursement, or other payments pursuant to Section 9 of the Master Agreement against any future amounts it may owe to the other Party.
ARTICLE 4
CONFIDENTIALITY
Notwithstanding Section 30 of the Master Agreement, the Parties agree that:
(24) This Confirmation is subject to the requirements of the California Public Records Act (Government Code Section 7920 et seq.);
(b) both Parties may disclose the terms of this Confirmation to the CAISO to effectuate Seller’s performance and the transfer of the Product and the Parties acknowledge that the CAISO may publicly disclose the transfer of the Product from Seller to Buyer in accordance with the CAISO Tariff promptly following Seller’s performance; and
©) in the event Buyer resells all or any portion of the Product, Buyer shall be permitted to disclose to the other party to such resale transaction all such information necessary to effect such resale transaction, other than the Contract Price; provided, that each disclosing Party shall use reasonable efforts to limit, to the extent possible, the ability of any such applicable Governmental Authority or the CAISO to further disclose such information. In addition, in the event Buyer resells all or any portion of the Contract Quantity to another party, Buyer shall be permitted to disclose to the other party to such resale transaction all such information necessary to effect such resale transaction.
ARTICLE 5
COLLATERAL REQUIREMENTS
Notwithstanding any provision in the WSPP Agreement to the contrary, neither Party shall be required to post collateral or other security for this Transaction.
ARTICLE 6
GENERAL PROVISIONS
6.1 Governing Law
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 in accordance with the laws of the State of California, without regard to principles of conflicts of law.”
6.2 Counterparts
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4 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. 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.
6.3 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 Confirmation may be entered into only by a Documentary Writing executed by both Parties, and no amendment or modification to this Confirmation shall be enforceable except through a Documentary Writing executed by both Parties.
6.4 Joint Powers Authority
The Parties are each 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 public entities separate from their constituent members. Each Party will solely be responsible for all of its debts, obligations and liabilities accruing and arising out of this Confirmation. Each Party agrees that it 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’s constituent members, in connection with this Confirmation.
DocuSign Envelope ID: 2F2070FC-B57A-4160-9F0C-7A9DC1C3A350 DocuSign Envelope ID: 22BB737C-4911-4B05-93E0-CFE2640FF06B DocuSign Envelope ID: 89776608-DF7F-450F-BB9F-6DE1423CC8E9 Appendix A SCP
5 Acknowledged and agreed to as of the Confirmation Effective Date.
SILICON VALLEY CLEAN ENERGY, a
California joint powers authority
SONOMA CLEAN POWER AUTHORITY,
a California joint powers authority
By:
Name:
Title:
By:
Name:
Title:
SONOMA CLEAN POWER AUTHORITY,
a California joint powers authority
By:
Name:
Title:
DocuSign Envelope ID: 2F2070FC-B57A-4160-9F0C-7A9DC1C3A350 CEO
Girish Balachandran
DocuSign Envelope ID: 22BB737C-4911-4B05-93E0-CFE2640FF06B Managing Director
Deb Emerson
Michael Koszalka
Chief Operating Officer
DocuSign Envelope ID: 89776608-DF7F-450F-BB9F-6DE1423CC8E9 Appendix A SCP
x DocuSigned by:
v 5CA64B9AC4C24C3
EaactSOa/
Appendix A - 1
APPENDIX A
DEFINED TERMS
“Agreement” has the meaning set forth in the introductory paragraph of this Confirmation. “Bilateral Import Capability Transfer” is the transfer of Remaining Import Capability from one Market Participant (as defined in the CAISO Tariff) to another, as described in the CAISO Tariff. “Branch Group” means the branch group name used by the CAISO to represent the location of an Intertie with a Maximum Import Capability.
“Buyer” has the meaning set forth in the introductory paragraph of this Confirmation and shall have the same meaning as “Purchaser” under the Master Agreement. “CAISO” means the California Independent System Operator Corporation, or any successor entity performing the same functions.
“CAISO Tariff” means the California Independent System Operator Corporation Tariff, Business Practice Manuals (BPMs), Operating Agreements, and Operating Procedures, including the rules, protocols, procedures and standards attached thereto, as the same may be amended or modified from time to time and approved by FERC, if applicable.
“Confirmation” has the meaning set forth in the introductory paragraph of this Confirmation. “Confirmation Effective Date” has the meaning set forth in the introductory paragraph of this Confirmation.
“Contract Month” means the month during the Delivery Period as set forth in the Contract Quantity Table in Section 1.3.
“Contract Price” has the meaning set forth in the Contract Quantity Table in Section 1.3. “Contract Quantity” has the meaning set forth in the Contract Quantity Table in Section 1.3. “CPUC” means the California Public Utilities Commission. “Delivery Period” has the meaning set forth in Section 1.2(a). “Delivery Point” has the meaning set forth in the Contract Quantity Table in Section 1.3. “Governmental Authority” means any: (a) federal, state, local, municipal or other government; (b) 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 (c) court or governmental tribunal. “Intertie” has the meaning set forth in the CAISO Tariff. “Master Agreement” has the meaning set forth in the introductory paragraph of this Confirmation.
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Appendix A - 2
“Maximum Import Capability” has the meaning set forth in the CAISO Tariff. “MW” means megawatt (or 1,000 kilowatts) of alternating current electric energy generating capacity.
“One-Time Payment” has the meaning set forth in Section 3.1. “Product” has the meaning set forth in Section 1.1.
“Registration” has the meaning set forth in Section 2.1. “Remaining Import Capability” has the meaning set forth in the CAISO Tariff. “SC” has the meaning set forth in the CAISO Tariff.
“Seller” has the meaning set forth in the introductory paragraph of this Confirmation. “Tariff” means the tariff and protocol provisions of the CAISO, as amended or supplemented from time to time.
“Term” has the meaning set forth in Section 1.2(b).
“WSPP Agreement” is defined in the introductory paragraph hereof.
DocuSign Envelope ID: 2F2070FC-B57A-4160-9F0C-7A9DC1C3A350 DocuSign Envelope ID: 22BB737C-4911-4B05-93E0-CFE2640FF06B DocuSign Envelope ID: 89776608-DF7F-450F-BB9F-6DE1423CC8E9 Appendix A SCP
Bilateral Import Capability Transfer (Buy or Sell)
1 CONFIRMATION LETTER
BETWEEN
SILICON VALLEY CLEAN
ENERGY
AND
PENINSULA CLEAN
ENERGY
This Confirmation Letter including all appendices hereto (“Confirmation”) confirms the transaction between Peninsula Clean Energy, a California joint powers authority (“Seller”), and Silicon Valley Clean Energy, a joint powers authority (“Buyer”), each individually a “Party” and together the “Parties”, dated as of June 5, 2023 (the “Confirmation Effective Date”) in which Seller agrees to provide to Buyer the right to the Product, as such term is defined in this Confirmation, in the amounts described in this Confirmation (the “Transaction”). This Transaction is governed the Western Systems Power Pool Agreement effective as of August 26, 2022, as amended from time to time, but not including any Exhibit or Service Schedule thereto unless and to the extent that such Exhibit or Service Schedule is expressly incorporated herein (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 described to them in the Master Agreement or, if not defined in the Master Agreement, in the CAISO Tariff. To the extent this Confirmation is inconsistent with any provision of the Master Agreement, this Confirmation shall govern the rights and obligations of the Parties hereunder.
ARTICLE 1. TRANSACTION TERMS
1.1 Product
Existing Contract Import Capability
1.2 Delivery of Product
Seller shall sell and deliver to Buyer, and Buyer shall receive and purchase from Seller, the Product at the Delivery Point in the amount of the applicable Contract Quantity for each day of each month of the Delivery Period.
1.3 Delivery Period and Term
(a) Delivery Period. The Delivery Period shall be
inclusive, unless terminated earlier in accordance with the terms of this Agreement.
(b) Term. The Term of this Transaction shall commence upon the Confirmation Effective Date and shall continue until the later of (i) the expiration of the
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Bilateral Import Capability Transfer (Buy or Sell)
2 Delivery Period or (ii) the date the Parties’ obligations under this Confirmation have been satisfied. This Confirmation shall be effective and binding as of the Confirmation Effective Date.
1.4 Delivery Point
The Delivery Point shall be the CAISO Branch Group corresponding to the CAISO Intertie PACI_MSL (COB).
1.5 Contract Quantity
The Contract Quantity for each day of each applicable Contract Month is as follows:
Contract Quantity (MWs for each day of such Contract Month)
1.6 Contract Price
The Contract Price means, for any Contract Month, the price specified in the Contract Price table as set forth below.
CONTRACT PRICE TABLE
ARTICLE 2. DELIVERY OBLIGATIONS
2.1 Delivery of Product
Within three (3) Business Days after the date that Seller receives the One-Time Payment from Buyer, Seller shall register the Bilateral Import Capability Transfer of the Product in the amount of the Contract Quantity at the Delivery Point in CAISO’s CIRA Tool(or successor platform)(the “Registration”). Seller shall complete promptly such other actions required by the CAISO to effect such transfer.
As soon as reasonably practicable thereafter, but no later than three (3) Business Days from Registration, Buyer shall accept and confirm Seller’s Registration in CAISO’s CIRA Tool and will then communicate to Seller whether the Bilateral Import Capability Transfer from Seller to Buyer of the Product in the amount of the Contract Quantity at the Delivery Point was successful or unsuccessful (a successful transfer, the “Transfer Completion Email”). If the Bilateral Import Capability Transfer from Seller to Buyer of the Product in the amount of the Contract Quantity at the Delivery Point is unsuccessful, the Parties shall begin the Registration process set forth in this Section 2.1 again, until the Parties receive a Transfer Completion Email.
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Bilateral Import Capability Transfer (Buy or Sell)
3 2.2 Buyer’s Re-Sale of Product
Buyer may re-sell, at its sole cost and expense, all or a portion of the Product acquired under this Confirmation.
ARTICLE 3. PAYMENT
3.1 One-Time Payment
Buyer shall make a payment (“One-Time Payment”) to Seller no later than (10) Business Days after the date an invoice is received. Seller shall provide Buyer the invoice for the One-Time Payment no later than seven (7) Business Days from the Confirmation Effective Date.
The One-Time Payment shall be calculated as follows:
One-Time Payment = ∑n
i(AൈൈͳͲͲͲሻ
where:
A = Contract Price (in $/kW-month) for Contract Month i B = Contract Quantity i (in MW) transferred by Seller for Contract Month i
i = Each Contract Month
n = number Contract Months
.
3.2 Offset Rights
Either Party may offset any amounts owing to it for revenues, penalties, fines, costs reimbursement, or other payments pursuant to Section 9 of the Master Agreement against any future amounts it may owe to the other Party under this Confirmation.
ARTICLE 4. CONFIDENTIALITY
(a) Both Parties may disclose the terms and conditions of this Agreement and any and all written or recorded or oral information, data, analyses, documents, and materials furnished or made available by a Party to the other Party in connection with this Agreement to the CAISO, the CPUC, and all divisions thereof, the CEC, and any Governmental Authority; provided, that each disclosing Party shall use reasonable efforts to limit,
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Bilateral Import Capability Transfer (Buy or Sell)
4 to the extent possible, the information disclosed and the ability of any such applicable Governmental Authority or the CAISO to further disclose such information;
(b) Both Parties may disclose the terms of this Confirmation to the CAISO, as necessary, to effectuate Seller’s performance and the transfer of the Product and the Parties acknowledge that the CAISO may publicly disclose the transfer of the Product from Seller to Buyer in accordance with the CAISO Tariff promptly following Seller’s performance; (c) In the event Buyer resells all or any portion of the Product, Buyer shall be permitted to disclose to the other party to such resale transaction all such information necessary to effect such resale transaction, other than the Contract Price; and
(d) Each Party recognizes that this Confirmation is subject to the requirements of the California Public Records Act (Government Code Section 6250 et seq.); and, in the event of a public records requests pursuant to this act or any other applicable law, either party may disclose this Confirmation and such disclosure shall not be a violation of this Article 4; provided, that each disclosing Party shall first provide notice of its intended disclosure and cooperate reasonably with the other party in such other party’s efforts to maintain the confidentiality of this Confirmation or its contents.
ARTICLE 5. GENERAL PROVISIONS
5.1 Governing Law
Notwithstanding Section 24 of the Master 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.
5.2 Collateral/Credit Requirements
Notwithstanding any provision in the Master Agreement to the contrary, including Section 27, neither Party shall be required to post collateral or other security for this Transaction.
5.3 No Recourse to Members of Buyer and Seller
Buyer and Seller are each 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.
Buyer and Seller will each solely be responsible for all of its debts, obligations and liabilities accruing and arising out of this Confirmation. Neither Buyer no Seller will have any rights and shall not make any claims, take any actions or assert any
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Bilateral Import Capability Transfer (Buy or Sell)
5 remedies against any of the other party’s constituent members, or the officers, directors, advisors, contractors, consultants or employees of such other party or such other party’s constituent members, in connection with this Confirmation.
5.4 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, facsimile or scanned signatures as originals under this Confirmation. Delivery of an executed signature page of this Confirmation by facsimile or electronic mail transmission (including PDF) shall be the same as delivery of a manually executed signature page.
5.5 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, no amendment or modification to this Transaction shall be enforceable except through a Documentary Writing executed by both Parties.
[Signature page follows]
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6 In WITNESS WHEREOF, the Parties have caused this Confirmation to be duly executed as of the Confirmation Effective Date:
PENINSULA CLEAN
ENERGY, a California joint
powers authority
By:
Name:
Title:
SILICON VALLEY CLEAN
ENERGY, a
California joint powers authority
By:
Name:
Title:
Janis C. Pepper
CEO
DocuSign Envelope ID: E6E5F5EB-CFD7-4969-89E6-E554BF87DCE0 Appendix A PCE
DocuSigned by:
5CA64B9AC4C24C3...
Bilateral Import Capability Transfer (Buy or Sell)
7 APPENDIX A
DEFINED TERMS
“Agreement” has the meaning specified in the introductory paragraph of this Confirmation. “Bilateral Import Capability Transfer” is the transfer of Existing Contract Import Capability from one Market Participant (as defined in the CAISO Tariff) to another, as described in the CAISO Tariff.
“Branch Group” means the branch group name used by the CAISO to represent the location of an Intertie with a Maximum Import Capability.
“Buyer” has the meaning specified in the introductory paragraph of this Confirmation and shall have the same meaning as “Purchaser” under the Master Agreement. “CAISO” means the California Independent System Operator Corporation, or any successor entity performing the same functions.
“CAISO Tariff” means the California Independent System Operator Corporation Tariff, Business Practice Manuals (BPMs), Operating Agreements, and Operating Procedures, including the rules, protocols, procedures and standards attached thereto, as the same may be amended or modified from time to time and approved by FERC, if applicable. “CEC” means the California Energy Commission.
“Confirmation” has the meaning specified in the introductory paragraph of this Confirmation.
“Confirmation Effective Date” has the meaning specified in the introductory paragraph of this Confirmation.
“Contract Month” means the month during the Delivery Period as set forth in the Contract Quantity Table specified Section 1.5.
“Contract Price” has the meaning specified in Section 1.6. “Contract Quantity” has the meaning specified in Section 1.5. “CPUC” means the California Public Utilities Commission. “Delivery Period” has the meaning specified in Section 1.3(a). “Delivery Point” has the meaning specified in Section 1.4.
DocuSign Envelope ID: E6E5F5EB-CFD7-4969-89E6-E554BF87DCE0 Appendix A PCE
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8 “Existing Contract Import Capability” has the meaning set forth in the CAISO Tariff. “Governmental Authority” means any: (a) federal, state, local, municipal or other government; (b) 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 (c) court or governmental tribunal.
“Intertie” has the meaning set forth in the CAISO Tariff. “Master Agreement” has the meaning specified in the introductory paragraph of this Confirmation.
“MW” means megawatt (or 1,000 kilowatts) of alternating current electric energy generating capacity.
“Product” has the meaning specified in Section 1.1.
“Registration” has the meaning specified in Section 2.1. “Scheduling Point” has the meaning set forth in the CAISO Tariff. “SC” has the meaning set forth in the CAISO Tariff.
“Seller” has the meaning specified in the introductory paragraph of this Confirmation. “Term” has the meaning specified in Section 1.3(b).
“Transfer Completion Email” has the meaning specified in Section 2.1
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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 June 9, 2023 (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.
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the “Contract Quantity
Nucleus:
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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.
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' ” has the meaning specified for such term in the Tariff. ' ” or “ ” means the flexible capacity requirements established “ ” means
that can be counted toward an LSEs FCR,
' ” means the
' ” means Designated RA Capacity consisting of RAR Attributes and, if 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 resource adequacy attributes, as
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. .
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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
Sellers 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
Nucleus:
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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.
DocuSign Envelope ID: 4929584A-1DA8-43D4-B4E9-C05A01274741 DocuSign Envelope ID: 29C35FD2-EC1B-4FB2-B6B8-568B38111F20 Appendix A Shell
' ” means the
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5 ARTICLE 2. UNIT INFORMATION
Name Mesquite Solar 3
Location Maricopa County, AZ
CAISO Resource ID MSOLAR_2_SOLAR3
Unit SCID DSWM
Unit NQC Varies by Month
Unit EFC N/A
Resource Type Solar
Resource Category (1, 2, 3 or 4) 4
Flexible RAR Category (1, 2 or 3) N/A
Path 26 (North or South) South
Local Capacity Area (if any, as of
Confirmation Effective Date) None
Deliverability restrictions, if any, as
described in most recent CAISO
deliverability assessment
N/A
Run Hour Restrictions N/A
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
DocuSign Envelope ID: 4929584A-1DA8-43D4-B4E9-C05A01274741 DocuSign Envelope ID: 29C35FD2-EC1B-4FB2-B6B8-568B38111F20 Appendix A Shell
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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
4.1 Delivery Period
The Delivery Period shall be: .
4.2 Delivery Point
The Delivery Point for each Unit shall be the CAISO Control Area, and if applicable, the LAR region in which the Unit is electrically interconnected.
4.3 Contract Quantity
The Contract Quantity for each Monthly Delivery Period shall be:
Contract Quantity Table
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.
DocuSign Envelope ID: 4929584A-1DA8-43D4-B4E9-C05A01274741 DocuSign Envelope ID: 29C35FD2-EC1B-4FB2-B6B8-568B38111F20 Appendix A Shell
this Contingent Firm RA Product, “Contingent Firm'1 shall have the same meaning as “Unit Firm"in the Master Agreement.
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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:
DocuSign Envelope ID: 4929584A-1DA8-43D4-B4E9-C05A01274741 DocuSign Envelope ID: 29C35FD2-EC1B-4FB2-B6B8-568B38111F20 Appendix A Shell
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 Nucleus:
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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.
DocuSign Envelope ID: 4929584A-1DA8-43D4-B4E9-C05A01274741 DocuSign Envelope ID: 29C35FD2-EC1B-4FB2-B6B8-568B38111F20 Appendix A Shell
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excused under the terms of the Product or by Buyer’s failure to perform 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 DocuSign Envelope ID: 4929584A-1DA8-43D4-B4E9-C05A01274741 DocuSign Envelope ID: 29C35FD2-EC1B-4FB2-B6B8-568B38111F20 Appendix A Shell
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 DocuSign Envelope ID: 4929584A-1DA8-43D4-B4E9-C05A01274741 DocuSign Envelope ID: 29C35FD2-EC1B-4FB2-B6B8-568B38111F20 Appendix A Shell
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subject to agreement of such Parties, in each Party's sol Nucleus:
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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.
DocuSign Envelope ID: 4929584A-1DA8-43D4-B4E9-C05A01274741 DocuSign Envelope ID: 29C35FD2-EC1B-4FB2-B6B8-568B38111F20 Appendix A Shell
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,
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:
Name: John W. Pillion
By:
Name:
Title: Confirmations Team Lead Title:
Date: Date: 6/9/23
DocuSign Envelope ID: 4929584A-1DA8-43D4-B4E9-C05A01274741 Girish Balachandran
CEO
6/12/2023
DocuSign Envelope ID: 29C35FD2-EC1B-4FB2-B6B8-568B38111F20 Appendix A Shell
x DocuSigned by:
5CA64B9AC4C24C3...
Joint CCA (Buys) WSPP Standard RA Confirmation SVCE05RA2023 6/8/2023
1 WSPP RESOURCE ADEQUACY CONFIRMATION
This Confirmation confirms the transaction between Silicon Valley Clean Energy Authority, a California joint powers authority (“Seller”) and East Bay Community Energy Authority, a California joint powers authority (“Purchaser”), and each individually a “Party” and together the “Parties”, dated as of June 8, 2023 (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 26, 2022 (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.
DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: 146348EA-B04D-4538-9BD0-1B07B4E9D6CA DocuSign Envelope ID: 3E2A5591-C309-40FA-8B0C-3EB518CD6E6E Appendix A EBCE - Sale
Joint CCA (Buys) WSPP Standard RA Confirmation SVCE05RA2023 6/8/2023
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, (i) monthly Supply Plans and (ii) annual Supply Plans if the Effective Date is prior to the year-ahead Compliance Showing Deadline applicable for the Showing Months specified in Appendix B, in accordance with the Tariff and CPUC requirements and no later than the initial Compliance Showing Deadline for such Showing Month, identifying and confirming the transfer of the Expected Contract Quantity of Product to Purchaser for each Showing Month. The total amount of Product identified and confirmed for such Showing Month shall equal the Expected Contract Quantity.
(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 DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: 146348EA-B04D-4538-9BD0-1B07B4E9D6CA DocuSign Envelope ID: 3E2A5591-C309-40FA-8B0C-3EB518CD6E6E Appendix A EBCE - Sale
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3 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 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) 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 ContractQuantity
(a) If Seller is providing Contingent Firm RA Product, Seller’s obligation to deliverthe 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.
(c) If Seller is providing Contingent Firm RA Product, Seller’s obligation to deliverthe Contract Quantity for each Showing Month may be reduced at Seller’s option by the amount of any reductions in Unit NQC or Unit EFC of any Unit(s). (d) Seller’s obligation to deliver the Contract Quantity for each day of each Showing Month may be reduced at Seller’s option in the event Purchaser fails to deliver, for any reason, the contract quantity of product set forth in Appendix B of the Swap Confirmation (such option, the “Swap Reduction Option”); provided, however, that (i) Seller’s obligation to deliver the Contract Quantity of Product may not be reduced by an amount greater than the contract quantity of product that Purchaser
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 DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: 146348EA-B04D-4538-9BD0-1B07B4E9D6CA DocuSign Envelope ID: 3E2A5591-C309-40FA-8B0C-3EB518CD6E6E Appendix A EBCE - Sale
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4 failed to deliver under the Swap Confirmation and (ii) that the Swap Reduction Option is subject to Seller providing written notice to Purchaser of such modification no later than two (2) Business Days before the initial Compliance Showing Deadline for such Showing Month. Seller’s rights under the Swap Reduction Option are cumulative and in addition to Seller’s rights under the Swap Confirmation.
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 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 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) Seller shall, or shall cause the SC to submit a Supply Plan that includes the Replacement Units for each Showing Month and, if applicable, annual filing, no later than the Notification Deadline for Purchaser’s Compliance Showings; and (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.
Subject to the satisfaction of the conditions contained in subsections (a) – (c) of this Section 2.3, once Seller has identified in writing any Replacement Units that meet the requirements of this Section 2.3, then any such Replacement Units shall be deemed a Unit for purposes of this Confirmation for that 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 DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: 146348EA-B04D-4538-9BD0-1B07B4E9D6CA DocuSign Envelope ID: 3E2A5591-C309-40FA-8B0C-3EB518CD6E6E Appendix A EBCE - Sale
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5 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.
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, 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.
(c) If Seller fails to pay the foregoing damages, penalties, fines or costs, or fails to reimburse Purchaser for those damages, penalties, fines or costs, then, without prejudice to its other rights and remedies, Purchaser may setoff and recoup those damages, 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 DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: 146348EA-B04D-4538-9BD0-1B07B4E9D6CA DocuSign Envelope ID: 3E2A5591-C309-40FA-8B0C-3EB518CD6E6E Appendix A EBCE - Sale
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6 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. (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 the Product 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) day of the Showing Month, and if such day 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
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7 (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 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.
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.
(b) 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 DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: 146348EA-B04D-4538-9BD0-1B07B4E9D6CA DocuSign Envelope ID: 3E2A5591-C309-40FA-8B0C-3EB518CD6E6E Appendix A EBCE - Sale
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8 Body responsible for administering the applicable Compliance Obligations, including to 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.
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9 ARTICLE 5
RESERVED
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 DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: 146348EA-B04D-4538-9BD0-1B07B4E9D6CA DocuSign Envelope ID: 3E2A5591-C309-40FA-8B0C-3EB518CD6E6E Appendix A EBCE - Sale
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10 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).
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
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11 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
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 is a public entity separate from its constituent members. Each Party will solely be responsible for all debts, obligations and liabilities accruing and arising out of this Confirmation. Each Party agrees that it 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 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 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:
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12 “(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) Section 22.3(e) is deleted in its entirety and replaced with the following:
“[Intentionally omitted]”
(f) Section 22.3(f) is deleted in its entirety and replaced 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
DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: 146348EA-B04D-4538-9BD0-1B07B4E9D6CA DocuSign Envelope ID: 3E2A5591-C309-40FA-8B0C-3EB518CD6E6E Appendix A EBCE - Sale
Joint CCA (Buys) WSPP Standard RA Confirmation SVCE05RA2023 6/8/2023
13 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) In Section 34.4, the phrase “arbitration or” is deleted from the first line. (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
DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: 146348EA-B04D-4538-9BD0-1B07B4E9D6CA DocuSign Envelope ID: 3E2A5591-C309-40FA-8B0C-3EB518CD6E6E Appendix A EBCE - Sale
Joint CCA (Buys) WSPP Standard RA Confirmation SVCE05RA2023 6/8/2023
14 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 thereof: “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 as a PDF attachment to an email 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 DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: 146348EA-B04D-4538-9BD0-1B07B4E9D6CA DocuSign Envelope ID: 3E2A5591-C309-40FA-8B0C-3EB518CD6E6E Appendix A EBCE - Sale
Joint CCA (Buys) WSPP Standard RA Confirmation SVCE05RA2023 6/8/2023
15 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.]
DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: 146348EA-B04D-4538-9BD0-1B07B4E9D6CA DocuSign Envelope ID: 3E2A5591-C309-40FA-8B0C-3EB518CD6E6E Appendix A EBCE - Sale
16 AGREED AS OF THE EFFECTIVE DATE:
Silicon Valley Clean Energy, a
California joint powers authority
East Bay Community Energy, a
California joint powers authority
By:
Name: Girish Balachandran
Title: Chief Executive Officer
By:
Name:
Title: _____________________________
DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 Marie Fontenot
Vice President of Power Resources
DocuSign Envelope ID: 146348EA-B04D-4538-9BD0-1B07B4E9D6CA DocuSign Envelope ID: 3E2A5591-C309-40FA-8B0C-3EB518CD6E6E Appendix A EBCE - Sale
x DocuSigned by:
5CA64B0AC4C24C3:
x DocuSigned by:
205FAF1AF9DE4A7...
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 Showing Deadline” means, for each Showing Month, the Compliance Showing plan submission due date for such Showing Month. For illustrative purposes only, as of the Effective Date, the applicable Compliance Showing plan submission due dates are as follows: (A) forty-five (45) days prior to the Showing Month covered by the Supply Plan for the monthly Supply Plan; and (B) the last Business Day of October that is prior to commencement of the year for the annual Supply Plan, such dates may be modified by the CAISO from time to time throughout the Delivery Period.
“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. “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 DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: 146348EA-B04D-4538-9BD0-1B07B4E9D6CA DocuSign Envelope ID: 3E2A5591-C309-40FA-8B0C-3EB518CD6E6E Appendix A EBCE - Sale
Appendix A - 2
amount of Contract Quantity of Product that Seller has elected to provide Alternate Capacity, less any reductions to Contract Quantity consistent with Section 2.2with 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. “MW” means megawatt.
“Net Qualifying Capacity” has the meaning given in CAISO’s FERC-approved Tariff. “Notification Deadline” is thirteen (13) Calendar Days before the Compliance Showing Deadline.
DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: 146348EA-B04D-4538-9BD0-1B07B4E9D6CA DocuSign Envelope ID: 3E2A5591-C309-40FA-8B0C-3EB518CD6E6E Appendix A EBCE - Sale
Appendix A - 3
“PlannedOutage”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” means a generating unit having the same capacity attributes as the Unit(s) originally identified in Appendix B hereof, including the same Resource Category, RAR Attributes, and, as applicable, LAR Attributes, FCR Attributes, and Flexible Capacity Category, and otherwise meeting the requirements specified Section 2.3 hereof. A Replacement Unit shall not utilize coal or coal materials as a source of fuel, must be a specific resource that is connected directly to the CAISO controlled grid, or be under the operational control of CAISO, and may not be an unspecified import.
“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. “SC” means Scheduling Coordinator as defined in the Tariff.
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“Showing Month” means the calendar month of the Delivery Period that is the 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”. “Swap Confirmation” means that certain WSPP Agreement Confirmation between Seller and Purchaser dated concurrently herewith, in which Seller is purchasing 28 MW of System Generic Capacity (as defined under such confirmation) from Purchaser. “Swap Reduction Option” has the meaning specified in Section 2.2(c). “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(s) described in Appendix B. “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.
DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: 146348EA-B04D-4538-9BD0-1B07B4E9D6CA DocuSign Envelope ID: 3E2A5591-C309-40FA-8B0C-3EB518CD6E6E Appendix A EBCE - Sale
Appendix B - 1
APPENDIX B
PRODUCT AND UNIT INFORMATION
Product:
RAR Local RAR Flexible Capacity
and all Capacity Attributes related to such Product.
Additional Product Information (fill in all that apply):
CAISO Zone: System
Resource Category (MCC Bucket): 4
CPUC Local Area (if applicable): N/A
Flexible Capacity Category (if applicable): N/A
Delivery Period: .
Contract Quantity and Contract Price:
DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: 146348EA-B04D-4538-9BD0-1B07B4E9D6CA DocuSign Envelope ID: 3E2A5591-C309-40FA-8B0C-3EB518CD6E6E Appendix A EBCE - Sale
Appendix B - 2
Unit 1
Unit Specific Information
Resource Name MOSS LANDING POWER
BLOCK 1
Physical Location Moss Landing, CA
CAISO Resource ID MOSSLD_2_PSP1
SCID of Resource CYN1
Unit NQC by month (e.g., Jan=50,Feb=65): 510.00
Unit EFC by month (e.g., Jan=30, Feb=50) N/A
Resource Type (e.g., gas, hydro, solar, etc.) Thermal
Minimum Qualified Flexible Capacity
Category (Flex 1, 2 or 3)
N/A
Capacity Area (CAISO System, Fresno,
Sierra, Kern, LA Basin, Bay Area, Stockton,
Big Creek-Ventura, NCNB, San
Diego-IV or Humboldt)
Bay Area
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.]
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Appendix C - 1
APPENDIX C
NOTICE INFORMATION
Purchaser: East Bay Community Energy Seller: Silicon Valley Clean Energy
DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: 146348EA-B04D-4538-9BD0-1B07B4E9D6CA DocuSign Envelope ID: 3E2A5591-C309-40FA-8B0C-3EB518CD6E6E Appendix A EBCE - Sale
Appendix C - 2
DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: 146348EA-B04D-4538-9BD0-1B07B4E9D6CA DocuSign Envelope ID: 3E2A5591-C309-40FA-8B0C-3EB518CD6E6E Appendix A EBCE - Sale
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
DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: 146348EA-B04D-4538-9BD0-1B07B4E9D6CA DocuSign Envelope ID: 3E2A5591-C309-40FA-8B0C-3EB518CD6E6E Appendix A EBCE - Sale
Joint CCA (Buys) WSPP Standard RA Confirmation SVCE04RA2023 6/8/2023
1 WSPP RESOURCE ADEQUACY CONFIRMATION
This Confirmation confirms the transaction between East Bay Community Energy Authority, 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 June 8, 2023 (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 26, 2022 (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.
DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: 146348EA-B04D-4538-9BD0-1B07B4E9D6CA DocuSign Envelope ID: 85122498-BD9D-47F1-B863-C024650E739F Appendix A EBCE
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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, (i) monthly Supply Plans and (ii) annual Supply Plans if the Effective Date is prior to the year-ahead Compliance Showing Deadline applicable for the Showing Months specified in Appendix B, in accordance with the Tariff and CPUC requirements and no later than the initial Compliance Showing Deadline for such Showing Month, identifying and confirming the transfer of the Expected Contract Quantity of Product to Purchaser for each Showing Month. The total amount of Product identified and confirmed for such Showing Month shall equal the Expected Contract Quantity.
(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 DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: 146348EA-B04D-4538-9BD0-1B07B4E9D6CA DocuSign Envelope ID: 85122498-BD9D-47F1-B863-C024650E739F Appendix A EBCE
Joint CCA (Buys) WSPP Standard RA Confirmation SVCE04RA2023 6/8/2023
3 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 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) 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 ContractQuantity
(a) If Seller is providing Contingent Firm RA Product, Seller’s obligation to deliverthe 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.
(c) If Seller is providing Contingent Firm RA Product, Seller’s obligation to deliverthe Contract Quantity for each Showing Month may be reduced at Seller’s option by the amount of any reductions in Unit NQC or Unit EFC of any Unit(s). (d) Seller’s obligation to deliver the Contract Quantity for each day of each Showing Month may be reduced at Seller’s option in the event Purchaser fails to deliver, for any reason, the contract quantity of product set forth in Appendix B of the Swap Confirmation (such option, the “Swap Reduction Option”); provided, however, that (i) Seller’s obligation to deliver the Contract Quantity of Product may not be reduced by an amount greater than the contract quantity of product that Purchaser
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 DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: 146348EA-B04D-4538-9BD0-1B07B4E9D6CA DocuSign Envelope ID: 85122498-BD9D-47F1-B863-C024650E739F Appendix A EBCE
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4 failed to deliver under the Swap Confirmation and (ii) that the Swap Reduction Option is subject to Seller providing written notice to Purchaser of such modification no later than two (2) Business Days before the initial Compliance Showing Deadline for such Showing Month. Seller’s rights under the Swap Reduction Option are cumulative and in addition to Seller’s rights under the Swap Confirmation.
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 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 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) Seller shall, or shall cause the SC to submit a Supply Plan that includes the Replacement Units for each Showing Month and, if applicable, annual filing, no later than the Notification Deadline for Purchaser’s Compliance Showings; and (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.
Subject to the satisfaction of the conditions contained in subsections (a) – (c) of this Section 2.3, once Seller has identified in writing any Replacement Units that meet the requirements of this Section 2.3, then any such Replacement Units shall be deemed a Unit for purposes of this Confirmation for that 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 DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: 146348EA-B04D-4538-9BD0-1B07B4E9D6CA DocuSign Envelope ID: 85122498-BD9D-47F1-B863-C024650E739F Appendix A EBCE
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5 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.
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, 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.
(c) If Seller fails to pay the foregoing damages, penalties, fines or costs, or fails to reimburse Purchaser for those damages, penalties, fines or costs, then, without prejudice to its other rights and remedies, Purchaser may setoff and recoup those damages, 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 DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: 146348EA-B04D-4538-9BD0-1B07B4E9D6CA DocuSign Envelope ID: 85122498-BD9D-47F1-B863-C024650E739F Appendix A EBCE
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6 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. (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 the Product 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) day of the Showing Month, and if such day 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
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7 (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 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.
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.
(b) 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 DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: 146348EA-B04D-4538-9BD0-1B07B4E9D6CA DocuSign Envelope ID: 85122498-BD9D-47F1-B863-C024650E739F Appendix A EBCE
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8 Body responsible for administering the applicable Compliance Obligations, including to 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.
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9 ARTICLE 5
RESERVED
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 DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: 146348EA-B04D-4538-9BD0-1B07B4E9D6CA DocuSign Envelope ID: 85122498-BD9D-47F1-B863-C024650E739F Appendix A EBCE
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10 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).
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
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11 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
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 is a public entity separate from its constituent members. Each Party will solely be responsible for all debts, obligations and liabilities accruing and arising out of this Confirmation. Each Party agrees that it 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 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 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:
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12 “(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) Section 22.3(e) is deleted in its entirety and replaced with the following:
“[Intentionally omitted]”
(f) Section 22.3(f) is deleted in its entirety and replaced 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
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13 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) In Section 34.4, the phrase “arbitration or” is deleted from the first line. (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
DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: 146348EA-B04D-4538-9BD0-1B07B4E9D6CA DocuSign Envelope ID: 85122498-BD9D-47F1-B863-C024650E739F Appendix A EBCE
Joint CCA (Buys) WSPP Standard RA Confirmation SVCE04RA2023 6/8/2023
14 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 thereof: “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 as a PDF attachment to an email 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 DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: 146348EA-B04D-4538-9BD0-1B07B4E9D6CA DocuSign Envelope ID: 85122498-BD9D-47F1-B863-C024650E739F Appendix A EBCE
Joint CCA (Buys) WSPP Standard RA Confirmation SVCE04RA2023 6/8/2023
15 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.]
DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: 146348EA-B04D-4538-9BD0-1B07B4E9D6CA DocuSign Envelope ID: 85122498-BD9D-47F1-B863-C024650E739F Appendix A EBCE
16 AGREED AS OF THE EFFECTIVE DATE:
East Bay Community Energy, a
California joint powers authority
Silicon Valley Clean Energy, a
California joint powers authority
By:
Name:
Title:
By:
Name: Girish Balachandran
Title: Chief Executive
Officer_______________
DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 Marie Fontenot
Vice President of Power Resources
DocuSign Envelope ID: 146348EA-B04D-4538-9BD0-1B07B4E9D6CA DocuSign Envelope ID: 85122498-BD9D-47F1-B863-C024650E739F Appendix A EBCE
x DocuSigned by:
Auric FWcW 205FAF1AF9DF4A7
x DocuSigned by:
^irisL
'5OA64B0AC4C24G3:
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 Showing Deadline” means, for each Showing Month, the Compliance Showing plan submission due date for such Showing Month. For illustrative purposes only, as of the Effective Date, the applicable Compliance Showing plan submission due dates are as follows: (A) forty-five (45) days prior to the Showing Month covered by the Supply Plan for the monthly Supply Plan; and (B) the last Business Day of October that is prior to commencement of the year for the annual Supply Plan, such dates may be modified by the CAISO from time to time throughout the Delivery Period.
“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. “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 DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: 146348EA-B04D-4538-9BD0-1B07B4E9D6CA DocuSign Envelope ID: 85122498-BD9D-47F1-B863-C024650E739F Appendix A EBCE
Appendix A - 2
amount of Contract Quantity of Product that Seller has elected to provide Alternate Capacity, less any reductions to Contract Quantity consistent with Section 2.2with 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. “MW” means megawatt.
“Net Qualifying Capacity” has the meaning given in CAISO’s FERC-approved Tariff. “Notification Deadline” is thirteen (13) Calendar Days before the Compliance Showing Deadline.
DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: 146348EA-B04D-4538-9BD0-1B07B4E9D6CA DocuSign Envelope ID: 85122498-BD9D-47F1-B863-C024650E739F Appendix A EBCE
Appendix A - 3
“PlannedOutage”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” means a generating unit having the same capacity attributes as the Unit(s) originally identified in Appendix B hereof, including the same Resource Category, RAR Attributes, and, as applicable, LAR Attributes, FCR Attributes, and Flexible Capacity Category, and otherwise meeting the requirements specified Section 2.3 hereof. A Replacement Unit shall not utilize coal or coal materials as a source of fuel, must be a specific resource that is connected directly to the CAISO controlled grid, or be under the operational control of CAISO, and may not be an unspecified import.
“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. “SC” means Scheduling Coordinator as defined in the Tariff.
DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: 146348EA-B04D-4538-9BD0-1B07B4E9D6CA DocuSign Envelope ID: 85122498-BD9D-47F1-B863-C024650E739F Appendix A EBCE
Appendix A - 4
“Showing Month” means the calendar month of the Delivery Period that is the 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”. “Swap Confirmation” means that certain WSPP Agreement Confirmation between Seller and Purchaser dated concurrently herewith, in which Seller is purchasing 28 MW of System Generic Capacity (as defined under such confirmation) from Purchaser. “Swap Reduction Option” has the meaning specified in Section 2.2(c). “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(s) described in Appendix B. “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.
DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: 146348EA-B04D-4538-9BD0-1B07B4E9D6CA DocuSign Envelope ID: 85122498-BD9D-47F1-B863-C024650E739F Appendix A EBCE
Appendix B - 1
APPENDIX B
PRODUCT AND UNIT INFORMATION
Product:
RAR Local RAR Flexible Capacity
and all Capacity Attributes related to such Product.
Additional Product Information (fill in all that apply):
CAISO Zone: System
Resource Category (MCC Bucket): 4
CPUC Local Area (if applicable): San Diego-IV
Flexible Capacity Category (if applicable): 1
Delivery Period: .
Contract Quantity and Contract Price:
DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: 146348EA-B04D-4538-9BD0-1B07B4E9D6CA DocuSign Envelope ID: 85122498-BD9D-47F1-B863-C024650E739F Appendix A EBCE
Appendix B - 2
Unit 1
Unit Specific Information
Resource Name Palomar Energy Center
Physical Location Escondido, CA
CAISO Resource ID PALOMR_2_PL1X3
SCID of Resource LSDGE
Unit NQC by month (e.g., Jan=50,Feb=65): 513.21
Unit EFC by month (e.g., Jan=30, Feb=50) N/A
Resource Type (e.g., gas, hydro, solar, etc.) Gas
Minimum Qualified Flexible Capacity
Category (Flex 1, 2 or 3)
1 Capacity Area (CAISO System, Fresno,
Sierra, Kern, LA Basin, Bay Area, Stockton,
Big Creek-Ventura, NCNB, San
Diego-IV or Humboldt)
San Diego-IV
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.]
DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: 146348EA-B04D-4538-9BD0-1B07B4E9D6CA DocuSign Envelope ID: 85122498-BD9D-47F1-B863-C024650E739F Appendix A EBCE
Appendix C - 1
APPENDIX C
NOTICE INFORMATION
Seller: East Bay Community Energy Purchaser: Silicon Valley Clean Energy
DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: 146348EA-B04D-4538-9BD0-1B07B4E9D6CA DocuSign Envelope ID: 85122498-BD9D-47F1-B863-C024650E739F Appendix A EBCE
Appendix C - 2
DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: 146348EA-B04D-4538-9BD0-1B07B4E9D6CA DocuSign Envelope ID: 85122498-BD9D-47F1-B863-C024650E739F Appendix A EBCE
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
DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: 146348EA-B04D-4538-9BD0-1B07B4E9D6CA DocuSign Envelope ID: 85122498-BD9D-47F1-B863-C024650E739F Appendix A EBCE
Joint CCA (Buys) WSPP Standard RA Confirmation SVCE03RA2023 6/8/2023
1 WSPP RESOURCE ADEQUACY CONFIRMATION
This Confirmation confirms the transaction between East Bay Community Energy Authority, 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 June 8, 2023 (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 26, 2022 (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.
DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: C680AAC6-A585-427A-921C-20EC3E1551A6 DocuSign Envelope ID: 089224E5-6818-43D3-94C2-070326E86113 Appendix A EBCE
Joint CCA (Buys) WSPP Standard RA Confirmation SVCE03RA2023 6/8/2023
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, (i) monthly Supply Plans and (ii) annual Supply Plans if the Effective Date is prior to the year-ahead Compliance Showing Deadline applicable for the Showing Months specified in Appendix B, in accordance with the Tariff and CPUC requirements and no later than the initial Compliance Showing Deadline for such Showing Month, identifying and confirming the transfer of the Expected Contract Quantity of Product to Purchaser for each Showing Month. The total amount of Product identified and confirmed for such Showing Month shall equal the Expected Contract Quantity.
(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 DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: C680AAC6-A585-427A-921C-20EC3E1551A6 DocuSign Envelope ID: 089224E5-6818-43D3-94C2-070326E86113 Appendix A EBCE
Joint CCA (Buys) WSPP Standard RA Confirmation SVCE03RA2023 6/8/2023
3 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 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) 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 ContractQuantity
(a) If Seller is providing Contingent Firm RA Product, Seller’s obligation to deliverthe 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.
(c) If Seller is providing Contingent Firm RA Product, Seller’s obligation to deliverthe Contract Quantity for each Showing Month may be reduced at Seller’s option by the amount of any reductions in Unit NQC or Unit EFC of any Unit(s).
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
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 DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: C680AAC6-A585-427A-921C-20EC3E1551A6 DocuSign Envelope ID: 089224E5-6818-43D3-94C2-070326E86113 Appendix A EBCE
Joint CCA (Buys) WSPP Standard RA Confirmation SVCE03RA2023 6/8/2023
4 Unit, then Seller may, at no cost to Purchaser, provide Purchaser with replacement Product from one or more Replacement Units 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 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) Seller shall, or shall cause the SC to submit a Supply Plan that includes the Replacement Units for each Showing Month and, if applicable, annual filing, no later than the Notification Deadline for Purchaser’s Compliance Showings; and (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.
Subject to the satisfaction of the conditions contained in subsections (a) – (c) of this Section 2.3, once Seller has identified in writing any Replacement Units that meet the requirements of this Section 2.3, then any such Replacement Units shall be deemed a Unit for purposes of this Confirmation for that 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.
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.
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5 (b) Seller shall 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 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.
(c) If Seller fails to pay the foregoing damages, penalties, fines or costs, or fails to reimburse Purchaser for those damages, penalties, fines or costs, then, without prejudice to its other rights and remedies, Purchaser may setoff and recoup those damages, 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. (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.
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6 (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 the Product 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) day of the Showing Month, and if such day 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 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.
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 DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: C680AAC6-A585-427A-921C-20EC3E1551A6 DocuSign Envelope ID: 089224E5-6818-43D3-94C2-070326E86113 Appendix A EBCE
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7 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.
(b) 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 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:
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8 (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
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 DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: C680AAC6-A585-427A-921C-20EC3E1551A6 DocuSign Envelope ID: 089224E5-6818-43D3-94C2-070326E86113 Appendix A EBCE
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9 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 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 DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: C680AAC6-A585-427A-921C-20EC3E1551A6 DocuSign Envelope ID: 089224E5-6818-43D3-94C2-070326E86113 Appendix A EBCE
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10 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.
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 is a public entity separate from its constituent members. Each Party will solely be responsible for all debts, obligations and liabilities accruing and arising out of this Confirmation. Each Party agrees that it DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: C680AAC6-A585-427A-921C-20EC3E1551A6 DocuSign Envelope ID: 089224E5-6818-43D3-94C2-070326E86113 Appendix A EBCE
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11 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 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 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 DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: C680AAC6-A585-427A-921C-20EC3E1551A6 DocuSign Envelope ID: 089224E5-6818-43D3-94C2-070326E86113 Appendix A EBCE
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12 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) Section 22.3(e) is deleted in its entirety and replaced with the following:
“[Intentionally omitted]”
(f) Section 22.3(f) is deleted in its entirety and replaced 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 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
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13 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) In Section 34.4, the phrase “arbitration or” is deleted from the first line. (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.” (l) Section 37 is amended by inserting the following in the beginning thereof: “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:
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14 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 as a PDF attachment to an email 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.]
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15 AGREED AS OF THE EFFECTIVE DATE:
East Bay Community Energy, a
California joint powers authority
Silicon Valley Clean Energy, a
California joint powers authority
By:
Name:
Title:
By:
Name: Girish Balachandran
Title: Chief Executive Officer_________
DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 Marie Fontenot
Vice President of Power Resources
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x DocuSigned by:
205FAF1AF9DE4A7...
x DocuSigned by:
5CA64B0AG4C24O3:
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 Showing Deadline” means, for each Showing Month, the Compliance Showing plan submission due date for such Showing Month. For illustrative purposes only, as of the Effective Date, the applicable Compliance Showing plan submission due dates are as follows: (A) forty-five (45) days prior to the Showing Month covered by the Supply Plan for the monthly Supply Plan; and (B) the last Business Day of October that is prior to commencement of the year for the annual Supply Plan, such dates may be modified by the CAISO from time to time throughout the Delivery Period.
“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. “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 DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: C680AAC6-A585-427A-921C-20EC3E1551A6 DocuSign Envelope ID: 089224E5-6818-43D3-94C2-070326E86113 Appendix A EBCE
Appendix A - 2
amount of Contract Quantity of Product that Seller has elected to provide Alternate Capacity, less any reductions to Contract Quantity consistent with Section 2.2with 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. “MW” means megawatt.
“Net Qualifying Capacity” has the meaning given in CAISO’s FERC-approved Tariff. “Notification Deadline” is thirteen (13) Calendar Days before the Compliance Showing Deadline.
DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: C680AAC6-A585-427A-921C-20EC3E1551A6 DocuSign Envelope ID: 089224E5-6818-43D3-94C2-070326E86113 Appendix A EBCE
Appendix A - 3
“PlannedOutage”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” means a generating unit having the same capacity attributes as the Unit(s) originally identified in Appendix B hereof, including the same Resource Category, RAR Attributes, and, as applicable, LAR Attributes, FCR Attributes, and Flexible Capacity Category, and otherwise meeting the requirements specified Section 2.3 hereof. A Replacement Unit shall not utilize coal or coal materials as a source of fuel, must be a specific resource that is connected directly to the CAISO controlled grid, or be under the operational control of CAISO, and may not be an unspecified import.
“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. “SC” means Scheduling Coordinator as defined in the Tariff.
DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: C680AAC6-A585-427A-921C-20EC3E1551A6 DocuSign Envelope ID: 089224E5-6818-43D3-94C2-070326E86113 Appendix A EBCE
Appendix A - 4
“Showing Month” means the calendar month of the Delivery Period that is the 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(s) described in Appendix B. “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.
DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: C680AAC6-A585-427A-921C-20EC3E1551A6 DocuSign Envelope ID: 089224E5-6818-43D3-94C2-070326E86113 Appendix A EBCE
Appendix B - 1
APPENDIX B
PRODUCT AND UNIT INFORMATION
Product:
RAR Local RAR Flexible Capacity
and all Capacity Attributes related to such Product.
Additional Product Information (fill in all that apply):
CAISO Zone: System
Resource Category (MCC Bucket): 4
CPUC Local Area (if applicable): N/A
Flexible Capacity Category (if applicable): N/A
Delivery Period:
Contract Quantity and Contract Price:
DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: C680AAC6-A585-427A-921C-20EC3E1551A6 DocuSign Envelope ID: 089224E5-6818-43D3-94C2-070326E86113 Appendix A EBCE
Appendix B - 2
Unit 1
Unit Specific Information
Resource Name Tulare Solar 5
Physical Location
CAISO Resource ID VESTAL_2_TS5SR1
SCID of Resource
Unit NQC by month (e.g., Jan=50,Feb=65): 6.92
Unit EFC by month (e.g., Jan=30, Feb=50) N/A
Resource Type (e.g., gas, hydro, solar, etc.) Solar
Minimum Qualified Flexible Capacity
Category (Flex 1, 2 or 3)
N/A
Capacity Area (CAISO System, Fresno,
Sierra, Kern, LA Basin, Bay Area, Stockton,
Big Creek-Ventura, NCNB, San
Diego-IV or Humboldt)
CAISO
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.]
DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: C680AAC6-A585-427A-921C-20EC3E1551A6 DocuSign Envelope ID: 089224E5-6818-43D3-94C2-070326E86113 Appendix A EBCE
Appendix C - 1
APPENDIX C
NOTICE INFORMATION
Seller: East Bay Community Energy Purchaser: Silicon Valley Clean Energy
DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: C680AAC6-A585-427A-921C-20EC3E1551A6 DocuSign Envelope ID: 089224E5-6818-43D3-94C2-070326E86113 Appendix A EBCE
Appendix C - 2
DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: C680AAC6-A585-427A-921C-20EC3E1551A6 DocuSign Envelope ID: 089224E5-6818-43D3-94C2-070326E86113 Appendix A EBCE
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
DocuSign Envelope ID: 4037C1CC-6776-457B-AC56-78C732814E76 DocuSign Envelope ID: C680AAC6-A585-427A-921C-20EC3E1551A6 DocuSign Envelope ID: 089224E5-6818-43D3-94C2-070326E86113 Appendix A EBCE
DocuSign Envelope ID: 335ABE84-B7EA-4A3D-9166-798EA8CBEA0B Appendix A Direct Energy
EEI RESOURCE ADEQUACY CONFIRMATION
This confirmation (“Confirmation”) confirms the transaction between Direct Energy Business Marketing, LLC (“DEBM”), (“Party A”) and Silicon Valley Clean Energy Authority (“Party B”), each individually a “Party” and together the “Parties”, dated as of June 6, 2023 (the “Effective Date”), by which Seller agrees to sell and deliver, and Buyer agrees to purchase and receive, the Product. This Transaction is governed by the Edison Electric Institute Master Power Purchase and Sale Agreement between the Parties dated November 28, 2016 as amended from time to time (the “Master Agreement”). The Master Agreement and this Confirmation, including any applicable appendices, exhibits or amendments hereto, shall be collectively referred to herein as the “Agreement” and shall constitute a single agreement between the Parties with respect to the Transaction. Capitalized terms not otherwise defined in this Confirmation or the Master Agreement are defined in the Tariff. References to Sections are references to Sections of this Confirmation unless stated to be references to Sections of the Master Agreement or a statute.
The terms of the Transaction to which this Confirmation relates are as follows:
Seller: Direct Energy Business Marketing,
LLC Buyer: Silicon Valley Clean Energy Authority
Product: RAR Local RAR 3 Flexible Capacity, as further
described in Appendix B
Contract Price ($/kW-day):
Contract Quantity (MW):
Delivery Period:
Unit Information: Described in Appendix B
Payment Terms: 20th Day of the month following the Delivery Period, as further described in Article 3
This Confirmation is subject to the Appendices identified below and attached hereto:
Appendix A -Defined Terms
Appendix B -Product and Unit Information
Appendix C -Notice Information
Appendix D -Planned Outage Schedule
1 Jay Robertson
Sr. Director, West Power Trading
DocuSign Envelope ID: 335ABE84-B7EA-4A3D-9166-798EA8CBEA0B Appendix A Direct Energy
IN WITNESS WHEREOF, the Parties have signed this Confirmation effective as of the Effective Date.
Direct Energy Business Marketing, LLC
Sign:
Print:
Title:
Silicon Valley Clean Energy Authority
x DocuSigned by:
Sigil. 5CA64B9AC4O24C3
„ . Girish Bal achandran Print:
Title: CE0
2 DocuSign Envelope ID: 335ABE84-B7EA-4A3D-9166-798EA8CBEA0B Appendix A Direct Energy
ARTICLE 1
TRANSACTION TERMS
Product, Delivery Period, Contract Quantity, Contract Price and other specifics of the Product are described on page 1 of this Confirmation and in Appendix B. Appendices A, B, C, and D are incorporated into this Confirmation.
Firm RA Product:
Seller shall provide Buyer 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 Buyer 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 Buyer for penalties or fines pursuant to the terms of Section 2.5. 13 Contingent Firm RA Product:
Seller shall provide Buyer 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 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 Buyer 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 Buyer 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 Buyer for penalties or fines pursuant to the terms of Section 2.5.
ARTICLE 2
DELIVERY OBLIGATIONS AND ADJUSTMENTS
2.1 Sale and Delivery of Product
(a) For each day of the Delivery Period, Seller shall sell and deliver to Buyer, and Buyer 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 each day of 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 3 DocuSign Envelope ID: 335ABE84-B7EA-4A3D-9166-798EA8CBEA0B Appendix A Direct Energy
Product for Buyer, 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 day of the Delivery Period, Supply Plans in accordance with the Tariff and CPUC requirements to identify and confirm the Product delivered to Buyer for each day of the Delivery Period. The total amount of Product identified and confirmed for each day of the Delivery Period shall equal the Expected Contract Quantity. (d) Seller may sell and deliver Product from a Shown Unit that meets the requirements set forth in Appendix B. In no event shall a Shown Unit utilize coal or coal materials as a source of fuel or be a nuclear generating facility. 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 Buyer with the specific information contemplated in Appendix B no later than the Notification Deadline for the Delivery Period. (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 day of the Delivery Period, 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 Delivery Period.
(f) The Product is delivered and received when the CIRA Tool shows that the Supply Plan submitted in compliance with Buyer’s instructions, including Buyer’s instructions to withhold all or part of the Expected Contract Quantity from Seller’s Supply Plan for any day of the Delivery Period during the Delivery Period, has been accepted for the Product from the Shown Unit(s) by CAISO. Seller has failed to deliver the Product if (i) Buyer has elected to submit the Product from the Shown Unit(s) 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 day of the Delivery Period in such amount as instructed by Buyer for the applicable day(s) of the Delivery Period. Seller shall not have failed to deliver the Expected Contract Quantity if Buyer fails or chooses not to submit the Shown Unit(s) and the Product in its Resource Adequacy Plan with the CPUC or CAISO. To the extent, the Unit is not yet on the CPUC Net Qualifying Capacity list at the time the Supply Plan must be submitted, then the Product will be deemed delivered as a result of achieving the Commercial Operations for Markets date on June 2, 2023.
4 DocuSign Envelope ID: 335ABE84-B7EA-4A3D-9166-798EA8CBEA0B Appendix A Direct Energy
(g) The Shown Unit(s) must not have characteristics that would trigger the need for Buyer or Seller to fde an advice letter or other request for authorization with the CPUC.
2.2 Adjustments to ContractQuantity
If Seller is providing Contingent Firm RA Product, Seller’s obligation to deliver the Contract Quantity for each day of the Delivery Period may be reduced at Seller’s option by the amount of any Planned Outages which exist with respeetto any portion of the Unit during the applicabledays of such Planned Outages; provided, (i) Seller notifies Buyer by the Notification Deadline applicable to that day of the Delivery Period of the amount of Product from the Unit that Buyer may include in Buyer’s Compliance Showings for each day of 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.
In the event Seller is unable to provide the Contract Quantity for any portion of a Delivery Period because of a Planned Outage of a Unit, Seller has the option, but not the obligation, to provide Product for such portions of such Delivery Period from Replacement Units, provided Seller provides and identifiessuch Replacement Unitsin accordance with Section 2.3.
2.3 Seller’s Option To Provide Alternate Capacity
If Seller is unable to provide the full Contract Quantity for each day of each Delivery Period for any reason, including, without limitation, as provided in Section 2.2, or Seller desires to provide a portion of the Contract Quantity for any day of a Delivery Period from a different generating unit other than the Unit, then Seller may, at no cost to Buyer, provide Buyer with replacement Product from one or more Replacement Units in an amount such that the total amount of Product provided to Buyer from the Unit and any Replacement Unit(s) for each day of the Delivery Period is not more than the Contract Quantity, provided that in each case:
(a) Seller shall notify Buyer in writing of its intent to provide Alternate Capacity and shall identify the Replacement Unit(s) from which such Alternate Capacity shall be provided before the Notification Deadline for such Delivery Period; and (b) The designation of any Replacement Unit(s) by Seller shall be subject to Buyer’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 Buyer 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 Delivery Period. Buyer’s approval of a Replacement Unit as to a given Delivery Period shall not be construed as approval of such Replacement Unit for any subsequent Delivery Period.
2.4 Planned Outages
As of the Confirmation Effective Date, Seller and Buyer have agreed to all Planned Outages as specified in Appendix D (“Planned Outage Schedule”) for all relevant Delivery Periods for the following calendar year, or until the end of the Delivery Period, whichever isshorter. Seller may 5 DocuSign Envelope ID: 335ABE84-B7EA-4A3D-9166-798EA8CBEA0B Appendix A Direct Energy
provide Buyer with proposed changes to the Planned Outage Schedule from time to time. Within ten (10) Business Days after Buyer’s receipt of any such Seller proposed changes, Buyer shall notify Seller in writing of reasonable requests for modifications to such Seller proposed changes, and Seller shall, to the extent consistent with Prudent Operating Practice, accommodate Buyer’s requests regarding the timing of any Seller proposed changes to the Planned Outage Schedule.
2.5 Buyer’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 day of the Delivery Period, Seller shall be liable for damages pursuant to Section 4.1 of the Master Agreement.
(b) Seller shall indemnify, defend and hold harmless Buyer from any penalties, fines or costs, including Environmental Costs, assessed against Buyer 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 shall Buyer 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 Buyer for those penalties, fines or costs, then, without prejudice to its other rights and remedies, Buyer may setoff and recoup those penalties, fines or costs against any future amounts it may owe to Seller under this Confirmation or the Master Agreement.
2.6 Buyer’s Re-Sale of Product
(a) Buyer 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.
For any such a resale, the Resource Adequacy Plan of Buyer as used herein will refer to the Resource Adequacy Plan of Subsequent Buyer. Seller shall, or shall cause the Shown Unit’s SC, to follow Buyer’sinstructions with respect to providing such resold Product to Subsequent Buyers, to the extent such instructions are consistent with Seller’s obligations under this Confinnation. 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 Buyers to use such resold Product in a manner consistent with Buyer’s rights under this Confirmation. If Buyer incurs any liability to a Subsequent Buyer due to the failure of Seller or the Shown Unit’s SC to comply with this Confinnation, Seller shall be liable to Buyer for the same amounts Seller would have owed Buyer under this Confirmation if Buyer had not resold the Product.
(b) Buyer shall notify Seller in writing of any resale of Product and the Subsequent Buyer no later than two (2) Business Days before the Notification Deadline for each Delivery Period for which Buyer has resold Product. Buyer shall notify Seller of 6 DocuSign Envelope ID: 335ABE84-B7EA-4A3D-9166-798EA8CBEA0B Appendix A Direct Energy
any subsequent changes or further resales no later than two (2) Business Days before the Notification Deadline for the Delivery Period. (c) If CAISO or CPUC develops a centralized capacity market, Buyer shall have the exclusive right to direct the Seller or the Unit’s SC to offer, bid, or otherwise submit the Expected Contract Quantity for re-sale into such market, and Seller and the Unit’s SC shall comply with the Buyer’s direction and Buyer shall retain and receive all revenues from such re-sale.
(d) Buyer 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 Buyer’s direction and, to the extent that the CAISO designates the Expected Contract Quantity as CPM Capacity, Buyer shall be entitled to retain and receive the CPM Capacity Payment. Unless otherwise instructed by Buyer, (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 Buyer 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 Buyer has agreed to accept such designation.
(e) Notwithstanding any provisions herein, Buyer shall not re-sell the Product outside the CAISO.
ARTICLE 3
PAYMENTS
3.1 Payment
After Seller has delivered the Expected Contract Quantity in accordance with Section 2.1 and issued its invoice, Buyer shall pay for the Product as provided in Article Six of the Master Agreement and this Confirmation. Buyer shall make a monthly payment to Seller for each Unit by the later of (i) ten (10) Calendar Days after Buyer’s receipt of Seller’s invoice or (ii) the twentieth (20th) day of the month after the Delivery Period; provided, however, if such day is not a Business Day then payment shall be made by the following Business Day (“RA Capacity Payment”). Each Unit’s RA Capacity Payment shall be equal to the product of (a) the applicable Contract Price for the relevant day of the Delivery Period, (b) the Expected Contract Quantity for the day of the Delivery Period, and (c) 1,000, rounded to the nearest penny (i.e., two decimal places); provided, however, that the RA Capacity Payment shall be adjusted to reflect any portion of Expected Contract Quantity for the Delivery Period that was not delivered in accordance with Section 2.1 for such Showing Month.
7 DocuSign Envelope ID: 335ABE84-B7EA-4A3D-9166-798EA8CBEA0B Appendix A Direct Energy
3.2 Allocation of Other Payments and Costs
(a) Seller shall 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. Buyer must promptly report receipt of any such revenues to Seller. Buyer must pay to Seller any such amounts described in this Section 3.2(a) received by Buyer or a Subsequent Buyer. Without prejudice to its other rights and remedies, Seller 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 Buyer under the Master Agreement. (b) Buyer 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 Buyer. Seller shall pay to Buyer 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, Buyer may set off and recoup any such amounts that are not paid to it against amounts owed to Seller under the Master Agreement.
(c) Any Availability Incentive Payments or Non-Availability Charges are for Seller to receive and pay.
ARTICLE 4
OTHER BUYER 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. Buyer is not liable for, and Seller shall indemnify and hold Buyer 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 Buyer’s Duties to Take Actions to Allow Product Utilization Throughout the Delivery Period, Buyer and Seller shall take all commercially reasonable actions and execute all documents or instruments reasonably necessary to ensure (a) Buyer’s rights to the Expected Contract Quantity for the sole benefit of Buyer or any Subsequent Buyer, and (b) that Buyer 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 and supporting documentation to the CAISO, the CPUC, or any other Governmental Body 8 DocuSign Envelope ID: 335ABE84-B7EA-4A3D-9166-798EA8CBEA0B Appendix A Direct Energy
responsible for administering the applicable Compliance Obligations, including to demonstrate that the Expected Contract Quantity can be delivered to the CAISO controlled grid for the minimum hours required to satisfy RAR 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 Buyer 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 the Shown Unit(s);
(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 Buyer; and
(e) Seller has notified or will notify the Shown Unit’s SC that Buyer 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 Buyer, along with appropriate documentation supporting the amount of those revenues.
4.4 Market Based Rate Authority
Upon Buyer’s written request, Seller shall, in accordance with 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. 9 DocuSign Envelope ID: 335ABE84-B7EA-4A3D-9166-798EA8CBEA0B Appendix A Direct Energy
ARTICLE 5
AMENDMENTS TO THE MASTER AGREEMENT; GENERAL PROVISIONS
5.1 Termination Payment
For this Transaction, the following is inserted at the end Section 5.2 of the Master Agreement:
“If Buyer is the Non-Defaulting Party and Buyer reasonably expects to incur or be liable for any penalties, fines or costs from CAISO, or any Governmental Body, because Buyer or a Subsequent Buyer is not able to include the applicable Expected Contract Quantity in a Compliance Showing due to Seller’s Event of Default, then Buyer may, in good faith, estimate the amount of those penalties, fines or costs and include the estimate in its calculation of the Settlement Amount, subject to accounting to Seller when those penalties, fines or costs are finally ascertained. If this accounting establishes that Buyer’s estimate exceeds the actual amount of penalties, fines or costs, Buyer must promptly remit to Seller the excess amount with interest in accordance with Section 6.2 of the Master 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 anything in the Master Agreement:
(a) Buyer may disclose information as necessary in order to support its Compliance Showings or otherwise show it has met its Compliance Obligations; (b) Seller may disclose as necessary to a Shown Unit’s SC or as necessary for submitting Supply Plans;
(c) Each Party may disclose information as necessary to the independent evaluator or other administrator of any competitive solicitation process of Buyer, which in turn may disclose such information as necessary to CAISO or any Governmental Body; and
(d) Buyer may disclose information to any Subsequent Buyer.
5.3 Dodd-Frank Act
Each Party represents and warrants to the other that it is an “eligible contract participant” within the meaning of the United States Commodity Exchange Act §la(18). Without limiting Section
10.10 of the Master Agreement, 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 10 DocuSign Envelope ID: 335ABE84-B7EA-4A3D-9166-798EA8CBEA0B Appendix A Direct Energy
Authorized by a Tariff or Protocol Approved by the Federal Energy Regulatory Commission, 78 Fed. Reg. 19,880 (Apr. 2, 2013).
5.4 Change in Law
If any action by the CPUC, CAISO or any Governmental Body having jurisdiction results in any change in applicable law occurring after the Confirmation Effective Date that (i) materially changes Buyer’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 requirements for Resource Adequacy Requirements such that the Product can no longer be counted towards Buyer’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 Product sold hereunder in order to maintain the original intent of the Parties under this Confirmation. If the Change in Law results in the Product no longer being able to be counted towards Buyer’s Resource Adequacy Requirements, and the Parties have not reached agreement within thirty (30) days after the initiation of discussions regarding the Change in Law on amendments that would allow the Product to be able to be counted towards Buyer’s Resource Adequacy Requirements, Buyer may terminate this Confirmation upon written notice to Seller, which shall be effective the next Business Day after such notice is received, and any such termination shall be without liability to either Party, subject to payment of any amounts owing as of the effective date of such termination.
5.5 Governing Law
This Confirmation, including the provisions and requirements of the Tariff and the definition of the Product and its components, and any portion of the Master Agreement applicable to this Transaction shall be governed by and construed in accordance with the laws of the State of California, without regard to the conflicts of laws rules thereof.
5.6 Credit and Collateral
Except as provided in the Master Agreement, neither Party shall be required to post collateral or other security for this Transaction.
5.7 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, facsimile or scanned signatures as originals under this Confirmation. Delivery of an executed signature page of this Confirmation by facsimile or electronic mail transmission (including PDF) shall be the same as delivery of a manually executed signature page.
5.8 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 to the contrary, this 11 DocuSign Envelope ID: 335ABE84-B7EA-4A3D-9166-798EA8CBEA0B Appendix A Direct Energy
Transaction may be confirmed only through a written document executed by both Parties, and no amendment or modification to this Transaction shall be enforceable except through a written document executed by both Parties.
12 DocuSign Envelope ID: 335ABE84-B7EA-4A3D-9166-798EA8CBEA0B Appendix A Direct Energy
APPENDIX A
DEFINED TERMS
“Alternate Capacity” means replacement Product which Seller has elected to provide to Buyer 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 Delivery Period. “Contingent Firm RA Product” has the meaning set forth in Article 1 herein. “CPUC Decisions” means any currently effective or future decisions, resolutions, or rulingsrelated to the Resource Adequacy Requirements.
“Delivery Period” means the period specified in Appendix B during which Seller shall deliver the Product to Buyer.
“Effective Flexible Capacity” has the meaning given in the CAISO 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 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.
Appendix A - 1
DocuSign Envelope ID: 335ABE84-B7EA-4A3D-9166-798EA8CBEA0B Appendix A Direct Energy
“Expected Contract Quantity” means,with respect to any particular day 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 as Alternate Capacity with respect to such day, and (b) for Contingent Firm RA Product, the Contract Quantity of Product, including the amount of Contract Quantity of Product that Seller has elected to provide as Alternate Capacity with respect to such day, less any reductions to Contract Quantity for such day consistent with Section 2.2 with respect to which Seller has not elected to provide Alternate Capacity. “Firm RA Product” has the meaning set forth in Article 1 herein. “Flexible Capacity” or “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. “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.
“Net Qualifying Capacity” has the meaning given in the CAISO Tariff. “Notification Deadline” is five (5) Business Days before the relevant deadlines for the corresponding Compliance Showings applicable to the relevant Showing Month, or three (3) Business Days before the relevant deadlines for the corresponding Compliance Showings for the Delivery Period, if applicable.
“PlannedOutage”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, Local RAR and/or FCR for the Delivery Period, Unit, Contract Quantity, Contract Price and other specifications described on page 1 of this Confirmation and contained in Appendix B.
Appendix A - 2
DocuSign Envelope ID: 335ABE84-B7EA-4A3D-9166-798EA8CBEA0B Appendix A Direct Energy
“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 Buyer 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 Buyer 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. “Replacement Unit” means a generating unit meeting the requirements specified 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. “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 the Unit, or any Replacement Unit meeting the requirements of Section 2.3 of this Confirmation and specified by Seller in a Supply Plan, but not necessarily identified by Seller to Buyer on the Effective Date.
“Subsequent Buyer” means the Buyer of Product from Buyer in a re-sale of Product by Buyer. “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 may not be a nuclear or 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.