CITY OF R Nc O MIRAGE
STAFF REPORT
TO: Mayor and City Council
FROM: Jessica Pulliam, Sr. Management Analyst
Isaiah Hagerman, City Manager
DATE: April 21, 2022
SUBJECT: Approval of Power Charge Indifference Adjustment Voluntary Allocation of Long - Term Renewable Energy Portfolio from Southern California Edison and Authorization to Execute the Voluntary Allocation Agreement on behalf of Rancho Mirage Energy Authority
SPECIFIC REQUEST OR RECOMMENDATION
Approve the Power Charge Indifference Adjustment (PCIA) Voluntary Allocation of Long -Term Renewable Energy Portfolio from Southern California Edison (SCE) and Authorize the City Manager to Execute the Voluntary Allocation Agreement on behalf of Rancho Mirage Energy Authority.
JUSTIFICATION OR INFORMATION
BACKGROUND:
The PCIA is an exit fee charged by SCE to customers that choose another provider of electricity generation service through direct access or Community Choice Aggregators (CCA). The fee is designed to cover the difference in the market value of energy resources that were already contracted on a customer's behalf by SCE and the cost of those resources. In the past, while CCA customers paid these above -market costs through the PCIA, CCAs were not able to count the PCIA resources in their portfolios.
In 2021, the California Public Utilities Commission (CPUC) ordered the Investor -Owned Utilities (IOUs) to offer CCAs voluntary allocations of PCIA-eligible renewable resources and to sell any unallocated resources through an annual market offer process.
Rancho Mirage Energy Authority (RMEA) now can accept voluntary allocations of PCIA-eligible renewable resources from SCE at the Market Price Benchmark, which is established by the current market price in any given year and is the same price used to set the renewable energy portion of the PCIA.
In order to secure the voluntary allocations, RMEA must participate in SCE's enrollment process, which closes May 13, 2022, and then enter into a voluntary allocation agreement. A portion of the PCIA-eligible renewable energy resources includes long-term contracts of ten (10) years or AGENDA ITEM #
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DATE: April 21, 2022 Page 2 of 2
JUSTIFICATION OR INFORMATION CONTINUED:
greater. RMEA's allocation is based on its most recent load forecast. SCE has provided RMEA with a list of contracts and an indicative forecast of each resource's generation output that would be available to RMEA.
The long-term resources are comprised primarily of wind and solar and will help satisfy a portion of RMEA's long-term renewable contracting requirement as mandated by Senate Bill 350 (SB 350). SB 350 requires that all load -serving entities, including CCAs, enter into long-term renewable energy contracts with energy delivery to begin by the 2021 — 2024 compliance period.
RMEA will accept up to 30% of the offered allocation to complete its requirements under SB 350.
RECOMMENDATION:
Approve the Power Charge Indifference Adjustment (PCIA) Voluntary Allocation of Long -Term Renewable Energy Portfolio from Southern California Edison (SCE) and Authorize the City Manger to Execute the Voluntary Allocation Agreement on behalf of Rancho Mirage Energy Authority.
ATTACHMENT(S):
1. Voluntary Allocation Agreement
AGENDA ITEM #
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ATTACHMENT 1
VOLUNTARY ALLOCATION AGREEMENT
(SEE ATTACHED)
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Contract ID 9 [J
Voluntary Allocation Agreement
v. 2022.2.23
SCE — {Counterparty}
VOLUNTARY ALLOCATION
AGREEMENT
between
[COUNTERPARTYLEGAL NAME)
and
SOUTHERN CALIFORNIA EDISON COMPANY
(Contract ID #)
This Voluntary Allocation Agreement, including all appendices, exhibits, schedules, attachments, and any supplements hereto (the "Agreement") is entered into as of {date} (the "Effective Date"), between [Counterparty's Legal Name], a {insert state and form of formation or incorporation} ("Counterparty") and Southern California Edison Company, a California corporation ("SCE"), each individually a "Party" and together the "Parties".
Capitalized terms used but not otherwise defined in this Agreement have the meanings ascribed to them in the CAISO Tariff as of the date hereof.
RECITALS
WHEREAS, the CPUC adopted the power charge indifference adjustment ("PCIA") in order for customers ("Departed Load Customers") of investor -owned utilities ("IOUs") who later depart IOU service to remain responsible for costs incurred by IOUs on their behalf,
WHEREAS, the IOUs have a portfolio of contracts with third parties for the procurement of California RPS-Eligible Electric Energy which is subject to the PCIA (the "RPS PCIA Portfolio");
WHEREAS, the CPUC in CPUC Decision 21-05-030 provides for the allocation of the California RPS-Eligible Electric Energy and associated Green Attributes generated from an IOU's RPS PCIA Portfolio to certain Load Serving Entities ("LSE") whose customers include the IOU's Departed Load Customers ("PCIA-Eligible LSEs"), with the exception of certain California RPS-Eligible Electric Energy and associated Green Attributes that are (1) generated under agreements that do not have a termination date (i.e., evergreen contract), (2) generated by resources owned by IOUs, or (3) cannot be allocated due to: (a) there being no associated Renewable Energy Credits created pursuant to Sections 399.21(a)(4) — (5) of the California Public Utilities Code, or (b) the requirement that an electrical corporation utilize certain procured California RPS-Eligible Electric Energy and associated Green Attributes to meet its own renewables portfolio standard annual procurement target pursuant to Section 399.20 of the California Public Utilities Code, such as under contracts signed pursuant to the Public Utility Regulatory Policies Act and the Renewable Market Adjusting Tariff ("Eligible RPS PCIA Portfolio");
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WHEREAS, Counterparty is a PCIA-Eligible LSE that provides electric services to some of SCE's Departed Load Customers and desires to receive certain percentages, as elected in this Agreement, of its Load Share Percentage of the Product from SCE's Eligible RPS PCIA Portfolio; and
WHEREAS, SCE and the Counterparty desire to enter into this Agreement for the transfer of the Product from SCE's Eligible RPS PCIA Portfolio in accordance with the terms and conditions of this Agreement; and
NOW THEREFORE, in consideration of the mutual covenants set forth herein, and for such other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and intending to be legally bound, the Parties agree as follows:
ARTICLE 1. TERM AND VOLUNTARY ALLOCATION TERMS
1.1 Term
The "Term" of this Agreement shall commence upon the Effective Date and shall continue until all the obligations of the Parties under this Agreement have been satisfied, unless terminated earlier due to an Event of Default; provided, however, that such termination shall not affect or excuse the performance of either Party under any provision of this Agreement that by its terms survives any such termination.
1.2 Voluntary Allocation Terms
The "Product" is the Contract Quantity of California RPS-Eligible Product Electric Energy and associated Green Attributes from the Projects.
Each of the generating facilities listed in Appendix B shall be a "Project" subject to the generating facility no longer being a Project upon: (a) the Project being removed from SCE's Eligible RPS PCIA Portfolio in Project accordance with Section 2.5; (b) the conclusion of the applicable Delivery Period for the Projects designated as "Short -Term" on Appendix B, and (c) the conclusion of the delivery term for a Project designated as "Long - Term" on Appendix B.
The "Contract Quantity" shall be the sum of the Project Contract Quantities.
Contract For each Project, the "Project Contract Quantity" shall equal the total California RPS-Eligible Electric Energy generated by such Project and Quantity measured at the CAISO revenue meter, multiplied by Counterparty's Load Share Percentage in the PCIA Vintage Year which the Project is a part of, and further multiplied by the applicable Long -Term Election Percentage or Short -Term Election Percentage.
Pro Forma Ver. 2022.02.23
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SCE — [Counterparty}
Counterparty's Load Share Percentage shall be the same for each Project in Load Share
the same PCIA Vintage Year and will be as noted in Appendix B.
Percentage
Counterparty's Load Share Percentage may be updated after the Parties annual Meet and Confer Process in accordance with Section 2.6.
Percentage
Long -Term Election Percentage: [•]
Election of
Counterparty's
Short -Term Election Percentage: [•]
Load Share
�,SCE Note: The Long -Term Election Percentage and the Short -Term Election Percentage must be in 10% increments.)
The "Delivery Period" shall be the period commencing on the later of (a) CPUC Approval of this Agreement if required, and (b) [January 1, 2023][•] and continuing through: (x) for the Projects designated as "Long - Term" on Appendix B, the end of the longest delivery term of the Projects, as shown in Appendix B; and (y) for the Projects designated as "Short - Delivery
Term" on Appendix B, [•l. {SCE Note: The Delivery Period for the initial Period
Voluntary Allocation Agreements will start on January 1, 2023 and for subsequent Voluntary Allocation Agreements will start on January Is` of every subsequent RPS compliance period. The end of the Delivery Period for "Short -Term " elections will be the end of the applicable RPS com fiance period.for which these allocations are applicable. � Delivery Point
The "Delivery Point" shall be the Pricing Node applicable to each Project.
The "Contract Price" shall be the sum of the Energy Price and the REC Contract Price
Price.
ARTICLE 2, DELIVERY OBLIGATIONS
2.1 SCE's Conveyance of Electric Energy and Green Attributes (a) Beginning on the first day of the Delivery Period and throughout all applicable months of the Delivery Period, SCE shall deliver, or cause to be delivered, and Counterparty shall receive, or cause to be received, at the Delivery Point, the Contract Quantity of the California RPS-Eligible Electric Energy associated with the Product, for the Contract Price and subject to the terms and conditions of this Agreement. SCE shall be responsible for any costs or charges imposed on or associated with the California RPS-Eligible Electric Energy or its delivery up to the Delivery Point. Counterparty shall be responsible for any costs or charges imposed on or associated with the California RPS-Eligible Electric Energy or its receipt at and from the Delivery Point.
(b) SCE, or a qualified third party designated or otherwise agreed to by SCE, shall act as Scheduling Coordinator for the Projects. Counterparty Pro Forma Ver. 2022.02.23 3
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authorizes SCE, or its third party Scheduling Coordinator designee, to deliver the California RPS-Eligible Electric Energy associated with the Product to the CAISO at the Delivery Point as an agent on Counterparty's behalf.
(c) Title to and risk of loss related to the California RPS-Eligible Electric Energy shall transfer from SCE to Counterparty upon satisfaction of the delivery obligations in this Article 2. SCE warrants that it will deliver to Counterparty the Product free and clear of all liens, security interests, claims and encumbrances or any interest therein or thereto by any person arising prior to delivering such Product in accordance with this Article 2. (d) During the Delivery Period, SCE, at its own cost and expense, shall maintain its registration with WREGIS. All Green Attributes transferred by Seller hereunder shall be California RPS-compliant, subject to confirmation by the CEC. SCE shall, at its sole expense, use WREGIS as required pursuant to the WREGIS Operating Rules to effectuate the transfer of Green Attributes to Counterparty in accordance with WREGIS reporting protocols and WREGIS Operating Rules.
(e) For each applicable month of the Delivery Period, SCE shall deliver and convey the Green Attributes associated with the California RPS-Eligible Electric Energy delivered pursuant to Section 2.1(a) above within thirty (30) days: (a) of the creation of the WREGIS Certificates for the Green Attributes for the Projects where SCE is the WREGIS Account Holder or (b) of SCE's receipt of the WREGIS Certificates for the Projects for which SCE is not the WREGIS Account Holder. SCE shall deliver and convey such Green Attributes by properly transferring such WREGIS Certificates, in accordance with the rules and regulations of WREGIS, equivalent to the quantity of Green Attributes, to Counterparty into Counterparty's WREGIS account such that all right, title and interest in and to the WREGIS Certificates shall transfer from SCE to Counterparty; provided further, that if SCE fails to properly transfer such WREGIS Certificates to Counterparty in accordance with the above due to an error or omission of an administrative or clerical nature and if such failure can be cured with no harm to Counterparty, then SCE may cure such failure within thirty (30) days after notice of such failure.
(f) In addition to its other obligations under this Section 2.1, SCE shall convey to Counterparty WREGIS Certificates from the Projects that are of the same Vintage Year as the California RPS-Eligible Electric Energy that was provided under Section 2.1(a) of this Agreement.
2.2 Mutual Indemnification
Each Party shall indemnify, defend and hold harmless the other Party from and Pro Forma Ver. 2022.02.23
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against any Claims arising from or out of any event, circumstance, act or incident first occurring or existing during the period when control and title to Product is vested in such Party. Each Party shall indemnify, defend and hold harmless the other Party against any Governmental Charges for which such Party is responsible under this Agreement. Neither Party shall be liable with respect to any Claim to the extent that such Claim resulted from the negligence, willful misconduct, or bad faith of the indemnified Party.
2.3 Force Maieure
To the extent either Party is prevented by Force Majeure from carrying out, in whole or part, its obligations under this Agreement and such Party (the "Claiming Party") gives notice and details of the Force Majeure to the other Party as soon as practicable, then the Claiming Party shall be excused from the performance of its obligations (other than the obligation to make payments then due or becoming due with respect to performance prior to the Force Majeure). The Claiming Party shall remedy the Force Majeure with all reasonable dispatch. The non -Claiming Party shall not be required to perform or resume performance of its obligations to the Claiming Party corresponding to the obligations of the Claiming Party excused by Force Majeure.
2.4 Remedy for Failure to Make Timely Payment
(a) Stopping Deliveries. If Counterparty fails to make timely payment for the Product in accordance with the terms of this Agreement, and regardless of whether such failure is an Event of Default or SCE has designated an Early Termination Date, SCE shall immediately stop all deliveries of Product to Counterparty and shall have no obligation to restart deliveries of the Product until Counterparty has made all outstanding payments to SCE. Further, SCE shall have no obligation to provide Counterparty additional Product to make-up for Product not delivered pursuant to this Section 2.4(a) and the amount of Contract Quantity of Product to be delivered to the Counterparty shall be deemed reduced by the amount of Product not delivered pursuant to this Section 2.4(a).
(b) Retention of WREGIS Certificates. For avoidance of doubt, SCE shall have the right to retain and sell any WREGIS Certificates associated with California RPS-Eligible Electric Energy previously delivered to the Counterparty and not paid for by Counterparty.
2.5 Removal of Proieet from SCE's Eligible RPS PCIA Portfolio The Parties acknowledge and agree that SCE has the right, at any time and in its sole discretion, to optimize its Eligible RPS PCIA Portfolio by modifying, including, but not limited to, reducing any purchases of energy or capacity, terminating, or assigning to a third party any contract in its Eligible RPS PCIA Pro Forma Ver. 2022.02.23
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Portfolio. If a contract in SCE's Eligible RPS PCIA Portfolio is terminated or assigned to a third party, the Project corresponding to such contract shall cease to be a Project under this Agreement.
2.6 Load Share Percentage
The Parties acknowledge that at the conclusion of each annual Meet and Confer Process there may be updates ("Revised Load Share Percentages") to the Load Share Percentages for the PCIA Vintage Years shown in Appendix B. The Parties agree that upon SCE sending a letter to the Counterparty with the Revised Load Share Percentages, in accordance with the notice provisions of Section 9.3, the Load Share Percentages will be deemed updated to the Revised Load Share Percentages, as stated in the letter, as of January 15t of each year following the annual Meet and Confer Process, and that the Contract Quantity of Product to be delivered by SCE to Counterparty will be updated accordingly.
ARTICLE 3. PAYMENT
3.1 Monthly Payment
Counterparty shall pay SCE the "Monthly Cash Settlement Amount", in arrears, for each Calculation Period in the amount equal to the sum, of (A) plus (B) minus (C), where:
A = the sum, over all hours of the Calculation Period, of (i) the applicable Energy Price for each hour of Delivered Energy within the applicable CAISO market (i.e. integrated forward market, fifteen minute, and/or Real -Time Market) multiplied by (ii) the quantity of Delivered Energy during the time interval in each respective market; and B = the REC Price multiplied by the quantity of Green Attributes (in MWhs) that will be conveyed as described in Section 2.1 and that are associated with the Delivered Energy in the Calculation Period; and C = the sum, over all hours of the Calculation Period, of (i) the applicable Energy Price for each hour of Delivered Energy within the applicable CAISO market (i.e. integrated forward market, fifteen minute, and/or Real -Time Market) multiplied by (ii) the quantity of Delivered Energy during the time interval in each respective market.
Such Monthly Cash Settlement Amount constitutes payment for the Product, including the Green Attributes, for such applicable Calculation Period.
Counterparty shall be obligated to make such payments with respect to each applicable Calculation Period notwithstanding the fact that the Green Attributes associated with a particular Calculation Period may be delivered or credited to Pro Forma Ver. 2022.02.23
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SCE's WREGIS account subsequent to the conclusion of the applicable Calculation Period in accordance with Section 2.1(e), provided that if SCE fails to comply with the provisions of Section 2.1(e), Counterparty shall be entitled to exercise all rights and remedies available to Counterparty under this Agreement for SCE's failure to deliver the Product.
3.2 True -up of REC Price
If the CPUC publishes the "Calculation of the Market Price Benchmarks for the Power Charge Indifferent Adjustment Forecast and True Up" which has a final "RPS Adder" for a calendar year that differs from the REC Price invoiced to and paid by the Counterparty for the Product for that same calendar year, SCE will adjust future invoices to account for such differences. Subject to the other terms of this Agreement, no interest shall be paid on the amount of any adjustments due to the publishing of a final "RPS Adder." If this Agreement has terminated and a final "RPS Adder" is published that results in a Party owing a payment to the other Party, then the Party shall make such payment in accordance with Section
3.4. 3.3 Billing Period
The calendar month shall be the standard period for all payments under this Agreement (other than Termination Payments and as otherwise specified in this Agreement). As soon as practicable after the end of each month, each Party will render to the other Party an invoice for the payment obligations, if any, determined hereunder for the preceding month.
3.4 Timeliness of Payment
All invoices under this Agreement shall be due and payable in accordance with each Party's invoice instructions on or before the later of the twentieth (20th) day of each month, or tenth (1 Oth) day after receipt of the invoice or, if such day is not a Business Day, then on the next Business Day. Each Party will make payments by electronic funds transfer, or by other mutually agreeable method(s), to the account designated by the other Party. Any amounts not paid by the due date will be deemed delinquent and will accrue interest at the Interest Rate, such interest to be calculated from and including the due date to but excluding the date the delinquent amount is paid in full.
3.5 Disputes and Adjustments of Invoices
A Party may adjust any invoice rendered by it under this Agreement to correct any arithmetic or computational error or to include additional charges or claims within twenty-four (24) months after the close of the month in which the obligations being invoiced arose. A receiving Party may, in good faith, dispute the correctness of any invoice or of any adjustment to any invoice previously Pro Forma Ver. 2022.02.23 7
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rendered to it by providing notice to the other Party on or before the later of (i) twelve (12) months of the date of receipt of such invoice or adjusted invoice, or (ii) twenty-four (24) months after the close of the month in which the obligation being invoiced arose. Failure to provide such notice within the time frame set forth in the preceding sentence waives the dispute with respect to such invoice. A Party disputing all or any part of an invoice or an adjustment to an invoice previously rendered to it may pay only the undisputed portion of the invoice when due, provided such Party provides notice to the other Party of the basis for and amount of the disputed portion of the invoice that has not been paid. The disputed portion of the invoice must be paid within two (2) Business Days of resolution of the dispute, along with interest accrued at the Interest Rate from and including the original due date of the invoice to but excluding the date the disputed portion of the invoice is actually 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 but excluding the date repaid or deducted by the Party receiving such overpayment. An invoice can only be adjusted or amended after it was originally rendered within the time frames set forth in this Section. If an invoice is not rendered within twenty-four (24) months after the close of the month in which the payment obligations arose, the right to payment for that month under this Agreement is waived.
3.6 Nettin
The Parties hereby agree that they shall discharge mutual debts and payment obligations due and owing to each other as of the same date through netting, in which case all amounts owed by each Party to the other Party during the monthly billing period under this Agreement, including damages, payments or credits, shall be netted so that only the excess amount remaining due shall be paid by the Party who owes it. If the Parties enter into additional agreements for an allocation from SCE's Eligible RPS PCIA Portfolio ("New Voluntary Allocation Agreements"), SCE may, in its sole discretion, net any payment owed to Counterparty under this Agreement against any amount owed to SCE by Counterparty arising out of, or related to, such New Voluntary Allocation Agreements.
3.7 Payment
All amounts paid hereunder shall be rendered in the form of immediately available dollars. Payment, as applicable, shall be made by ACH, or in other form reasonably requested, to the following accounts:
SCE:
Bank:
ABA No.:
Account No.:
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Counterparty:
Bank:
ABA No.:
Account No.:
ARTICLE 4. OTHER SCE AND COUNTERPARTY REPRESENTATIONS,
WARRANTIES AND COVENANTS
4.1 Mutual Representations and Warranties
On the Effective Date, each Party represents and warrants to the other Party that:
(a) it is duly organized, validly existing and in good standing under the laws of the jurisdiction of its formation;
(b) it has all regulatory authorizations necessary for it to legally perform its obligations under this Agreement;
(c) the execution, delivery and performance of this Agreement is within its powers, have been duly authorized by all necessary action and do not violate any of the terms and conditions in its governing documents, any contracts to which it is a party or any law, rule, regulation, order or the like applicable to it;
(d) this Agreement and each other document executed and delivered in accordance with this Agreement constitutes its legally valid and binding obligation enforceable against it in accordance with its terms; subject to any equitable defenses;
(e) it is not Bankrupt and there are no proceedings pending or being contemplated by it or, to its knowledge, threatened against it which would result in it being or becoming Bankrupt;
(f) there is not pending or, to its knowledge, threatened against it or any of its Affiliates (for purposes of this Section, SCE shall be deemed to have no Affiliates) any legal proceedings that could materially adversely affect its ability to perform its obligations under this Agreement; (g) no Event of Default or Potential Event of Default with respect to it has occurred and is continuing and no such event or circumstance would occur as a result of its entering into or performing its obligations under this Agreement;
(h) it is acting for its own account, has made its own independent decision to enter into this Agreement and as to whether this Agreement is appropriate or Pro Forma Ver. 2022.02.23
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proper for it based upon its own judgment, is not relying upon the advice or recommendations of the other Party in so doing, and is capable of assessing the merits of and understanding, and understands and accepts, the terms, conditions and risks of this Agreement;
(i) it is a "forward contract merchant" within the meaning of the United States Bankruptcy Code;
(j) it is an "eligible commercial entity" within the meaning of the Commodity Exchange Act, as otherwise amended, updated or modified from time to time;
(k) it is an "eligible contract participant" within the meaning of the Commodity Exchange Act, as otherwise amended, updated or modified from time to time;
(1) it has entered into this Agreement in connection with the conduct of its business and it has the capacity or ability to make or take delivery of all Products referred to in the Agreement;
(m) it is a producer, processor, commercial user or merchant handling the Product, and it is entering into the Agreement for purposes related to its business as such; and
(n) the Agreement is not executed or traded on a "trading facility" as defined in the Commodity Exchange Act, as otherwise amended, updated or modified from time to time, and is subject to individual negotiation by the Parties.
4.2 SCE's Representations, Warranties and Covenants
(a) SCE, and, if applicable, its successors, represents and warrants that throughout the Term of this Agreement:
(i) a Project qualifies and is certified by the CEC as an Eligible Renewable Energy Resource as such term is defined in Public Utilities Code Section 399.12 or Section 399.16;
(ii) a Project's output delivered to Counterparty qualifies under the requirements of RPS;
(iii) all necessary steps to allow the Renewable Energy Credits transferred to Counterparty to be tracked in the WREGIS will be taken prior to the first delivery under this Agreement; (iv) it has the right to sell all right, title, and interest in the Product agreed to be delivered hereunder;
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(v) SCE has not sold the Product to be delivered under this Agreement to any other person or entity;
(vi) at the time of delivery, all rights, title, and interest in the Product to be delivered under this Agreement are free and clear of all liens, taxes, claims, security interests, or other encumbrances of any kind whatsoever;
(vii) the electric energy generated with the Green Attributes delivered under this Agreement was not and will not be separately sold, marketed, reported, or otherwise represented as renewable energy, renewable electricity, clean energy, zero -emission energy, or in any similar manner; and
(viii) a Project either (A) has a first point of interconnection with a California balancing authority, or a first point of interconnection with distribution facilities used to serve end users within a California balancing authority area; or (B) has an agreement to dynamically transfer electricity to a California balancing authority; or, if (A) or (B) are not applicable, a Project and the agreement executed by SCE for such Project meet the conditions in California Public Utilities Code Section 399.16(d).
(b) SCE and, if applicable, its successors, represents and warrant that throughout the Delivery Period the Renewable Energy Credits transferred to Counterparty conform to the definition and attributes required for compliance with RPS, as set forth in CPUC Decision 08-08-28, and as may be modified by subsequent decision of the CPUC or by subsequent legislation.
SCE makes no representation, warranty or covenant with respect to any portfolio content category designation pursuant to California Public Utilities Code Section 399.16 nor any eligibility of the Product to qualify as excess procurement pursuant to California Public Utilities Code Section 399.13(a)(4)(B).
To the extent a change in law occurs after execution of this Agreement that causes SCE's representation and warranty in Sections 4.2(a)(i)-(ii) and Section 4.2(b) to be materially false or misleading, it shall not be an Event of Default if SCE has used commercially reasonable efforts to comply with such change in law. "Commercially reasonable efforts" shall not require SCE to incur out-of-pocket expenses in excess of $25,000 in the aggregate in any one calendar year.
4.3 [Countervarty's Representations, Warranties and Covenants if Governmental Entity or Public Power System
(a) On the Effective Date and as a condition to the obligations of SCE under Pro Forma Ver. 2022.02.23
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this Agreement, Counterparty shall provide SCE certified copies of all ordinances, resolutions, public notices and other documents evidencing the necessary authorizations with respect to the execution, delivery and performance by Counterparty of this Agreement.
(b) As of the Effective Date and continuing through the Term, with respect to this Agreement, Counterparty represents and warrants to the SCE: (i) all acts necessary to the valid execution, delivery and performance of this Agreement, including without limitation, competitive bidding, public notice, election, referendum, prior appropriation or other required procedures has or will be taken and performed as required under the Act and the Counterparty's ordinances, bylaws or other regulations, (ii) all persons making up the governing body of the Counterparty are the duly elected or appointed incumbents in their positions and hold such positions in good standing in accordance with the Act and other applicable law, (iii) entry into and performance of this Agreement by Counterparty are for a proper public purpose within the meaning of the Act and all other relevant constitutional, organic or other governing documents and applicable law, (iv) the Term of this Agreement does not extend beyond any applicable limitation imposed by the Act or other relevant constitutional, organic or other governing documents and applicable law, (v) the Counterparty's obligations to make payments hereunder are unsubordinated obligations and such payments are (A) operating and maintenance costs (or similar designation) which enjoy first priority of payment at all times under any and all bond ordinances or indentures to which it is a party, the Act and all other relevant constitutional, organic or other governing documents and applicable law or (B) otherwise not subject to any prior claim under any and all bond ordinances or indentures to which it is a party, the Act and all other relevant constitutional, organic or other governing documents and applicable law and are available without limitation or deduction to satisfy all Counterparty's obligations hereunder or (C) are to be made solely from a Special Fund, (vi) entry into and performance of this Agreement and by the Counterparty will not adversely affect the exclusion from gross income for federal income tax purposes of interest on any obligation of Counterparty otherwise entitled to such exclusion, and (vii) obligations to make payments hereunder do not constitute any kind of indebtedness of Counterparty or create any kind of lien on, or security interest in, any property or revenues of Counterparty which, in either case, is proscribed by any provision of the Act or any other relevant constitutional, organic or other governing documents and applicable law, any order or judgment of any court or other agency of government applicable to it or its assets, or any contractual restriction binding on or affecting it or any of its assets.
(c) Counterparty warrants and covenants that with respect to its contractual obligations hereunder and performance thereof, it will not claim immunity on the grounds of sovereignty or similar grounds with respect to itself or its Pro Forma Ver. 2022.02.23 12
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revenues or assets from (i) suit, (ii) jurisdiction of court (including a court located outside the jurisdiction of its organization), (iii) relief by way of injunction, order for specific performance or recovery of property, (iv) attachment of assets, or (v) execution or enforcement of any judgment. (d) With respect to the transactions contemplated under this Agreement, Counterparty shall either: (i) have created and set aside a Special Fund or (ii) upon execution of this Agreement and prior to the commencement of each subsequent fiscal year of Counterparty during any Delivery Period, Counterparty shall have obtained all necessary budgetary approvals and certifications for payment of all of its obligations under this Agreement for such fiscal year. Any breach of this provision shall be deemed to have arisen during a fiscal period of Counterparty for which budgetary approval or certification of its obligations under this Agreement is in effect and, notwithstanding anything to the contrary in this Agreement, an Early Termination Date shall automatically and without further notice occur hereunder as of such date and Counterparty shall be treated as the Defaulting Party. Counterparty shall have allocated to the Special Fund or its general funds a revenue base that is adequate to cover Counterparty's payment obligations hereunder throughout the entire Delivery Period.] {SCE Note: Section 4.3 is only included if Counterparty is a Governmental Entity or Public Power System.)
CPUC Approval
(a) Within ninety (90) days after the Effective Date, if CPUC Approval of this Agreement is required by the CPUC, SCE shall file with the CPUC the appropriate request for CPUC Approval of this Agreement. SCE shall expeditiously seek CPUC Approval, including promptly responding to any requests for information related to the request for CPUC Approval. As requested by SCE, Counterparty shall use commercially reasonable efforts to support SCE in obtaining CPUC Approval. SCE has no obligation to seek rehearing or to appeal a CPUC decision which fails to provide CPUC Approval of this Agreement or which contains findings required for CPUC Approval with conditions or modifications unacceptable to SCE. (b) Either Party, in its sole discretion, on or before the ninetieth (90th) day after SCE files the request for CPUC Approval, has the right to terminate this Agreement upon notice in accordance with Section 9.3 of this Agreement, which such notice will be effective one (1) Business Day after such notice is given, if: (i) the CPUC issues a final and non -appealable order regarding this Agreement which contains conditions or modifications unacceptable to either Party, or (ii) CPUC Approval of this Agreement has not been obtained on or before the date that is sixty (60) days after the date that SCE files the request for CPUC Approval.
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(c) Notwithstanding any other provision in this Agreement, SCE will have no obligation to transfer Product to Counterparty and Counterparty shall have no obligation to receive or pay for the Product unless and until SCE and Counterparty have obtained or waived, in their sole discretion, if required by the CPUC, CPUC Approval of this Agreement.
(d) Failure to obtain CPUC Approval in accordance with this provision will not be deemed to be or cause an Event of Default by either Party. No Termination Payment will be due or owing by either Party upon termination of this Agreement due solely to failure to obtain CPUC Approval.
ARTICLE 5. EVENTS OF DEFAULT, REMEDIES
5.1 Events of Default
An "Event of Default" shall mean, with respect to a Party (a "Defaulting Party"), the occurrence of any of the following:
(a) the failure to make, when due, any payment required pursuant to this Agreement if such failure is not remedied within three (3) Business Days after written notice;
(b) any representation or warranty made by such Party herein is false or misleading in any material respect when made or when deemed made or repeated;
(c) the failure to perform any material covenant or obligation set forth in this Agreement (except to the extent constituting a separate Event of Default,) if such failure is not remedied within three (3) Business Days after written notice;
(d) such Party becomes Bankrupt;
(e) the failure of such Party to satisfy the creditworthiness/collateral requirements agreed to pursuant to Article 7 hereof or any other credit arrangement related to this Agreement;
(f) a Merger Event occurs with respect to such Party;
(g) the occurrence and continuation of (i) a default, event of default or other similar condition or event in respect of such Party, under one or more agreements or instruments, individually or collectively, relating to indebtedness for borrowed money in an aggregate amount of not less than the applicable Cross Default Amount, which results in such indebtedness becoming, or becoming capable at such time of being declared, immediately due and payable or (ii) a default by such Party, in making on the due date therefor one or more payments, individually or collectively, in an aggregate amount of not less than the applicable Cross Default Amount.
Counterparty's Cross Default Amount shall be [insert amount is words and Pro Forma Ver. 2022.02.23 14
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numerically]. SCE's Cross Default Amount shall be [insert amount is words and numerically];
(h) an event of default occurs (howsoever determined) under a Specified Energy Transaction with respect to such Party and, after giving effect to any applicable notice requirement or grace period, there occurs a liquidation of, an acceleration of obligations under, or an early termination of that Specified Energy Transaction; or
(i) the Party disaffirms, disclaims, repudiates, or rejects, in whole or in part, or challenges the validity of, this Agreement executed and delivered by that Party.
5.2 Declaration of an Early Termination Date and Calculation of Settlement Amounts
(a) If an Event of Default with respect to a Defaulting Party shall have occurred and be continuing, the other Party (the "Non -Defaulting Party") shall have the right to (i) designate a day and time of day, no earlier than the day such notice is effective and no later than twenty (20) days after such notice is effective, as an early termination date ("Early Termination Date") to accelerate all amounts owing between the Parties and to liquidate and terminate this Agreement, (ii) withhold any payments due to the Defaulting Party under this Agreement and (iii) suspend performance. The Non - Defaulting Party shall calculate, in a commercially reasonable manner, a Settlement Amount for this Agreement as of the Early Termination Date and the Termination Payment payable in connection with this Terminated Agreement shall be calculated in accordance with this Section 5.2 and with Section 5.3 below.
(b) The Non -Defaulting Party shall determine its Gains and Losses by determining the Market Quotation Average Price for the transactions under this Agreement. In the event the Non -Defaulting Party is not able, after commercially reasonable efforts, to obtain the Market Quotation Average Price, then the Non -Defaulting Party shall calculate its Gains and Losses for the transactions under this Agreement in a commercially reasonable manner by calculating the arithmetic mean of at least three (3) Forward Price Assessments for transactions substantially similar to the transactions contemplated under this Agreement. In the event the Non -Defaulting Party is not able, after commercially reasonable efforts to obtain at least three (3) Forward Price Assessments, then the Non -Defaulting Party shall calculate its Gains and Losses in a commercially reasonable manner by reference to information supplied to it by one or more third parties including, without limitation, quotations (either firm or indicative) of relevant rates, prices, yields, yield curves, volatilities, spreads, or other relevant market data in the relevant markets; provided, however, that the provider of such information shall not be an Affiliate of either Party. Only in the event the Non -Defaulting Pro Forma Ver. 2022.02.23 15
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Party is not able, after using commercially reasonable efforts, to obtain such third party information, then the Non -Defaulting Party may calculate its Gains and Losses in a commercially reasonable manner using relevant market data it has available to it internally.
5.3 Termination Payment
The Non -Defaulting Party shall net out (a) the Settlement Amount due to the Defaulting Party, if any, plus, at the option of the Non -Defaulting Party, any cash or other form of security then available to the Non -Defaulting Party pursuant to Article 7, plus any or all other amounts due to the Defaulting Party under this Agreement, against (b) the Settlement Amount due to the Non -Defaulting Party, if any, any cash then available to the Defaulting Party pursuant to Article 7, plus any or all other amounts due to the Non -Defaulting Party under this Agreement, so that all such amounts shall be netted out to a single liquidated amount (the "Termination Payment") payable by one Party to the other. The Termination Payment shall be due to or due from the Non -Defaulting Party as appropriate.
5.4 Notice of Payment of Termination Payment
As soon as practicable after a liquidation, but in no event more than fifteen (15) Business Days following the Early Termination Date, notice shall be given by the Non -Defaulting Party to the Defaulting Party of the amount of the Termination Payment and whether the Termination Payment is due to or due from the Non - Defaulting Party. The notice shall include a written statement explaining in reasonable detail the calculation of such amount. The Termination Payment shall be made by the Party that owes it within two (2) Business Days after such notice is effective.
5.5 Disputes With Respect to Termination Payment
If the Defaulting Party disputes the Non -Defaulting Party's calculation of the Termination Payment, in whole or in part, the Defaulting Party shall, within two (2) Business Days of receipt of Non -Defaulting Parry's calculation of the Termination Payment, provide to the Non -Defaulting Party a detailed written explanation of the basis for such dispute; provided, however, that if the Termination Payment is due from the Defaulting Party, the Defaulting Party shall first transfer Performance Assurance to the Non -Defaulting Party in an amount equal to the Termination Payment.
5.6 Closeout Setoffs
After calculation of a Termination Payment in accordance with Section 5.3, if the Defaulting Party would be owed the Termination Payment, the Non -Defaulting Party shall be entitled, at its option and in its discretion, to set-off against such Termination Payment any amounts due and owing by the Defaulting Party to the Pro Forma Ver. 2022.02.23 16
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Non -Defaulting Party under any other agreements, instruments or undertakings between the Defaulting Party and the Non -Defaulting Party with respect to the Specified Energy Transactions. The remedy provided for in this Section shall be without prejudice and in addition to any right of setoff, combination of accounts, lien or other right to which any Party is at any time otherwise entitled (whether by operation of law, contract or otherwise). Notwithstanding anything to the contrary contained in this Agreement, or in any other agreement, instrument, or undertaking between the Parties with respect to a Specified Energy Transaction, if an Early Termination Date has been designated pursuant to Section 5.2, then, in addition to the other remedies provided in this Agreement, the Non -Defaulting Party may accelerate, liquidate and terminate all, but not less than all, Specified Energy Transactions between the Parties.
5.7 Suspension of Performance
Notwithstanding any other provision of this Agreement, if (a) an Event of Default or (b) a Potential Event of Default shall have occurred and be continuing, the Non -Defaulting Party, upon written notice to the Defaulting Party, shall have the right (i) to suspend performance under this Agreement; provided, however, in no event shall any such suspension continue for longer than ten (10) Business Days unless an Early Termination Date shall have been declared and notice thereof pursuant to Section 5.2 given, and (ii) to the extent an Event of Default shall have occurred and be continuing to exercise any remedy available at law or in equity.
ARTICLE 6. LIMITATIONS
THERE IS NO WARRANTY OF MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE, AND ANY AND ALL IMPLIED WARRANTIES ARE DISCLAIMED. THE PARTIES CONFIRM THAT THE EXPRESS REMEDIES AND
MEASURES OF DAMAGES PROVIDED IN THIS AGREEMENT SATISFY THE ESSENTIAL PURPOSES HEREOF. FOR BREACH OF ANY PROVISION FOR
WHICH AN EXPRESS REMEDY OR MEASURE OF DAMAGES IS PROVIDED,
SUCH EXPRESS REMEDY OR MEASURE OF DAMAGES SHALL BE THE SOLE
AND EXCLUSIVE REMEDY, THE OBLIGOR' S LIABILITY SHALL BE LIMITED
AS SET FORTH IN SUCH PROVISION AND ALL OTHER REMEDIES OR DAMAGES AT LAW OR IN EQUITY ARE WAIVED. IF NO REMEDY OR MEASURE
OF DAMAGES IS EXPRESSLY PROVIDED HEREIN, THE OBLIGOR'S LIABILITY
SHALL BE LIMITED TO DIRECT ACTUAL DAMAGES ONLY, SUCH DIRECT
ACTUAL DAMAGES SHALL BE THE SOLE AND EXCLUSIVE REMEDY AND ALL OTHER REMEDIES OR DAMAGES AT LAW OR IN EQUITY ARE WAIVED.
NOTWITHSTANDING ANYTHING IN THIS AGREEMENT TO THE CONTRARY,
NEITHER PARTY SHALL BE LIABLE FOR CONSEQUENTIAL, INCIDENTAL,
PUNITIVE, EXEMPLARY OR INDIRECT DAMAGES, LOST PROFITS OR OTHER
BUSINESS INTERRUPTION DAMAGES, BY STATUTE, IN TORT OR CONTRACT,
UNDER ANY INDEMNITY PROVISION SET FORTH IN THIS AGREEMENT OR OTHERWISE; PROVIDED, HOWEVER, THAT NOTHING IN THIS PROVISION Pro Forma Ver. 2022.02.23
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SHALL AFFECT THE ENFORCEABILITY OF SECTIONS 5.2 AND 5_3 OF THIS AGREEMENT. IT IS THE INTENT OF THE PARTIES THAT THE LIMITATIONS
HEREIN IMPOSED ON REMEDIES AND THE MEASURE OF DAMAGES BE
WITHOUT REGARD TO THE CAUSE OR CAUSES RELATED THERETO,
INCLUDING THE NEGLIGENCE OF ANY PARTY, WHETHER SUCH
NEGLIGENCE BE SOLE, JOINT OR CONCURRENT, OR ACTIVE OR PASSIVE. TO
THE EXTENT ANY DAMAGES REQUIRED TO BE PAID HEREUNDER ARE
LIQUIDATED, THE PARTIES ACKNOWLEDGE THAT THE DAMAGES ARE
DIFFICULT OR IMPOSSIBLE TO DETERMINE, OR OTHERWISE OBTAINING AN
ADEQUATE REMEDY IS INCONVENIENT AND THE DAMAGES CALCULATED
HEREUNDER CONSTITUTE A REASONABLE APPROXIMATION OF THE HARM OR LOSS.
ARTICLE 7. CREDIT AND COLLATERAL REQUIREMENTS
7.1 Financial Information
If requested by SCE, the Counterparty shall deliver:
(a) Annual Reports. Within one hundred twenty (120) days following the end of each fiscal year, a copy of its annual report containing audited consolidated financial statements for such fiscal year. If only unaudited financial statements are available, they must include a Responsible Officer certification attesting to the accuracy of such statements. (b) Quarterly Reports. Within sixty (60) days after the end of each of its first three (3) fiscal quarters of each fiscal year, a copy of its quarterly report containing unaudited consolidated financial statements for such fiscal quarter.
(c) Reports. In all cases the reports shall be for the most recent accounting period and prepared in accordance with generally accepted accounting principles; provided, should any such statements not be available on a timely basis due to a delay in preparation or certification, such delay shall not be an Event of Default so long as the producing Party diligently pursues the preparation, certification and delivery of the statements.
7.2 Counterparty's Collateral Requirements
Counterparty will not be required to post collateral at the execution of this Agreement. If there is an Event of Default under this Agreement due to Counterparty's failure to make timely payments for the Product, SCE may require that, in addition to paying all outstanding amounts owed to SCE, and in consideration for SCE not exercising its rights to terminate this Agreement, Counterparty post collateral in an amount and form acceptable to SCE in its sole discretion.
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7.3 SCE's Collateral Requirements
Under no circumstances shall SCE be required to post collateral under this Agreement.
7.4 [Uniform/California] Commercial Code Waiver.
This Agreement sets forth the entirety of the agreement of the Parties regarding credit, collateral and adequate assurances. Except as expressly set forth herein, neither Party:
(a) has or will have any obligation to post margin, provide letters of credit, pay deposits, make any other prepayments or provide any other financial assurances, in any form whatsoever, nor
(b) will have reasonable grounds for insecurity with respect to the creditworthiness of a Party that is complying with the relevant provisions of Article 7 of this Agreement; and
all implied rights relating to financial assurances arising from Section [2-609 of the Uniform] [2609 of the California] Commercial Code or case law applying similar doctrines, are hereby waived.
ARTICLE 8. MARKET BASED RATE AUTHORITY AND GOVERNMENTAL
CHARGES
8.1 Cooperation
Each Party shall use reasonable efforts to implement the provisions of and to administer this Agreement in accordance with the intent of the parties to minimize all taxes, so long as neither Party is materially adversely affected by such efforts.
8.2 Governmental Charges
SCE shall pay or cause to be paid all taxes, charges, or fees imposed by any government authority ("Governmental Charges") on or with respect to the Product arising prior to the Delivery Point. Counterparty shall pay or cause to be paid all Governmental Charges on or with respect to the Product at and from the Delivery Point (other than ad valorem, franchise or income taxes which are related to the sale of the Product and are, therefore, the responsibility of the SCE).
In the event SCE is required by law or regulation to remit or pay Governmental Charges which are Counterparty's responsibility hereunder, Counterparty shall promptly reimburse SCE for such Governmental Charges. If Counterparty is required by law or regulation to remit or pay Governmental Charges which are SCE's responsibility hereunder, Counterparty may deduct the amount of any such Pro Forma Ver. 2022.02.23 19
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Governmental Charges from the sums due to SCE under Article 3 of this Agreement. Nothing shall obligate or cause a Party to pay or be liable to pay any Governmental Charges for which it is exempt under the law.
ARTICLE 9. MISCELLANEOUS
9.1 Assignment
Neither Party shall assign this Agreement or its rights hereunder without the prior written consent of the other Party, which consent may be withheld in the exercise of its sole discretion.
9.2 Governing Law; Dispute Resolution
(a) Governing Law and Venue: 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 LAWS. EACH PARTY WAIVES ITS RESPECTIVE RIGHT TO ANY
JURY TRIAL WITH RESPECT TO ANY DISPUTE ARISING UNDER
OR IN CONNECTION WITH THIS AGREEMENT. The Parties hereby consent to conduct all dispute resolution, judicial actions or proceedings arising directly, indirectly or otherwise in conjunction with, out of, related to, or arising from this Agreement in Los Angeles County, California. [NOTWITHSTANDING THE FOREGOING, IN RESPECT OF THE
APPLICABILITY OF THE ACT AS HEREIN PROVIDED, THE LAWS
OF THE STATE OF CALIFORNIA SHALL APPLY.] {SCE Note: The bracketed provision is only included if Counterparty is a Governmental Entity or Public Power System.)
(b) Dispute Resolution:
(1) Mediation. The Parties agree that any and all disputes, claims or controversies arising out of, relating to, concerning or pertaining to this Agreement, or to either Party's performance or failure of performance under this Agreement, which disputes, claims, or controversies the Parties have been unable to resolve by informal methods after undertaking a good faith effort to do so, shall first be submitted to Judicial Arbitration and Mediation Services, Inc. ("JAMS"), its successor, or any other mutually agreeable neutral (the "Mediator") for mediation, and if the matter is not resolved through mediation, then it shall be submitted as provided below for final and binding arbitration.
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The Parties agree that there will be no interlocutory appellate relief (such as writs) available. Any dispute resolution process pursuant to this Section shall be commenced within one (1) year of the date of the occurrence of the facts giving rise to the dispute, without regard to the date such facts are discovered; provided, if the facts giving rise to the dispute were not reasonably capable of being discovered at the time of their occurrence, then such one (1) year period shall commence on the earliest date that such facts were reasonably capable of being discovered, and in no event more than four (4) years after the occurrence of the facts giving rise to the dispute. If any dispute resolution process pursuant to this Section with respect to a dispute is not commenced within such one (1) year time period, such dispute shall be waived and forever barred, without regard to any other limitations period set forth by law or statute.
Either Party may initiate the mediation by providing to the other Party a written request for mediation setting forth the subject of the dispute and the relief requested.
The Parties will cooperate with one another in selecting the Mediator from the JAMS' panel of neutrals, or in selecting a mutually acceptable non -JAMS Mediator, and in scheduling the time and place of the mediation.
Such selection and scheduling will be completed within forty-five (45) days after a Party provides a written request for mediation.
Unless otherwise agreed to by the Parties, the mediation will not be scheduled for a date that is greater than one hundred twenty (120) days after a Party provides a written request for mediation.
The Parties covenant that they will participate in the mediation in good faith, and that they will share equally in its costs (other than each Party's individual attorneys' fees and costs related to the Party's participation in the mediation, which fees and costs will be borne by such Party).
All offers, promises, conduct and statements, whether oral or written, made in connection with or during the mediation by either of the Parties, their agents, representatives, employees, experts and attorneys, and by the Mediator or any of the Mediator's agents, representatives and employees, will not be subject to discovery and will be confidential, privileged and inadmissible for any purpose, including impeachment, in any arbitration or other proceeding between or involving the Parties, or either of them, provided, evidence that is otherwise admissible or discoverable will not be rendered inadmissible or non -discoverable as a result of its use in the mediation.
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(2) Arbitration. Either Party may initiate binding arbitration with respect to the matters first submitted to mediation by making a written demand for binding arbitration before a single, neutral arbitrator (the "Arbitrator") within sixty (60) days following the unsuccessful conclusion of the mediation provided for in Section (ii) above. If a written demand for arbitration is not provided by either Party within sixty (60) days following the unsuccessful conclusion of the mediation provided for in Section (i) above, the dispute resolution process shall be deemed complete and further resolution of such dispute shall be barred, without regard to any other limitations period set forth by law or statute.
The Parties will cooperate with one another in promptly selecting the Arbitrator and shall further cooperate in scheduling the arbitration to commence no later than one hundred eighty (180) days from the date of the initial written demand for binding arbitration.
If, notwithstanding their good faith efforts, the Parties are unable to agree upon a mutually acceptable Arbitrator, the Arbitrator shall be appointed as provided for in California Code of Civil Procedure Section 1281.6.
Unless otherwise agreed to by the Parties, the individual acting as the Mediator shall be disqualified from serving as the Arbitrator in the dispute, although the Arbitrator may be another member of the JAMS panel of neutrals or such other panel of neutrals from which the Parties have agreed to select the Mediator.
Upon a Party's written demand for binding arbitration, such dispute, claim or controversy submitted to arbitration, including the determination of the scope or applicability of this Agreement to arbitrate, shall be determined by binding arbitration before the Arbitrator, in accordance with the laws of the State of California, without regards to principles of conflicts of laws.
Except as provided for herein, the arbitration shall be conducted by the Arbitrator in accordance with the rules and procedures for arbitration of complex business disputes for the organization with which the Arbitrator is associated.
Absent the existence of such rules and procedures, the arbitration shall be conducted in accordance with the California Arbitration Act, California Code of Civil Procedure Section 1280 et seq and California procedural law (including the Code of Civil Procedure, Civil Code, Evidence Code and Rules of Court, but excluding local rules).
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Notwithstanding the rules and procedures that would otherwise apply to the arbitration, and unless the Parties agree to a different arrangement, the place of the arbitration shall be in Los Angeles County, California.
Also, notwithstanding the rules and procedures that would otherwise apply to the arbitration, and unless the Parties agree to a different arrangement, discovery will be limited as follows:
(1) Before discovery commences, the Parties shall exchange an initial disclosure of all documents and percipient witnesses which they intend to rely upon or use at any arbitration proceeding (except for documents and witnesses to be used solely for impeachment);
(2) The initial disclosure will occur within thirty (30) days after the initial conference with the Arbitrator or at such time as the Arbitrator may order;
(3) Discovery may commence at any time after the Parties' initial disclosure;
(4) The Parties will not be permitted to propound any interrogatories or requests for admissions;
(5) Discovery will be limited to twenty-five (25) document requests (with no subparts), three (3) lay witness depositions, and three (3) expert witness depositions (unless the Arbitrator holds otherwise following a showing by the Party seeking the
additional documents or depositions that the documents or depositions are critical for a fair resolution of the Dispute or that a Party has improperly withheld documents);
(6) Each Party is allowed a maximum of three (3) expert witnesses, excluding rebuttal experts;
(7) Within sixty (60) days after the initial disclosure, or at such other time as the Arbitrator may order, the Parties shall exchange a list of all experts upon which they intend to rely at the arbitration proceeding;
(8) Within thirty (30) days after the initial expert disclosure, the Parties may designate a maximum of two (2) rebuttal experts; (9) Unless the Parties agree otherwise, all direct testimony will be in form of affidavits or declarations under penalty of perjury; and
(10) Each Party shall make available for cross examination at the arbitration hearing its witnesses whose direct testimony has been so submitted.
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Subject to Article 6 (Limitations), the Arbitrator will have the authority to grant any form of equitable or legal relief a Party might recover in a court action. The Parties acknowledge and agree that irreparable damage would occur if certain provisions of this Agreement are not performed in accordance with the terms of the Agreement, that money damages would not be a sufficient remedy for any breach of these provisions of this Agreement, and that the Parties shall be entitled, without the requirement of posting a bond or other security, to specific performance and injunctive or other equitable relief as a remedy for a breach of Section 9.9 of this Agreement.
Judgment on the award may be entered in any court having jurisdiction.
The Arbitrator shall, in any award, allocate all of the costs of the binding arbitration (other than each Party's individual attorneys' fees and costs related to the Party's participation in the arbitration, which fees and costs shall be borne by such Party), including the fees of the Arbitrator, against the Party who did not prevail.
Until such award is made, however, the Parties shall share equally in paying the costs of the arbitration.
At the conclusion of the arbitration hearing, the Arbitrator shall prepare in writing and provide to each Party a decision setting forth factual findings, legal analysis, and the reasons on which the Arbitrator's decision is based. The Arbitrator shall also have the authority to resolve claims or issues in advance of the arbitration hearing that would be appropriate for a California superior courtjudge to resolve in advance of trial. The Arbitrator shall not have the power to commit errors of law or fact, or to commit any abuse of discretion, that would constitute reversible error had the decision been rendered by a California superior court. The Arbitrator's decision may be vacated or corrected on appeal to a California court of competent jurisdiction for such error. Unless otherwise agreed to by the Parties, all proceedings before the Arbitrator shall be reported and transcribed by a certified court reporter, with each Party bearing one-half of the court reporter's fees.
9.3 Notices
All notices, requests, statements or payments shall be made as specified in this Appendix C. Notices (other than scheduling requests) shall, unless otherwise specified herein, be in writing and may be delivered by hand delivery, United States mail, overnight courier service or facsimile. Notice by facsimile or hand delivery shall be effective at the close of business on the day actually received, if received during business hours on a Business Day, and otherwise shall be effective at the close of business on the next Business Day. Notice by overnight Pro Forma Ver. 2022.02.23 24
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United States mail or courier shall be effective on the next Business Day after it was sent. A Party may change its addresses by providing notice of same in accordance herewith.
9.4 General
This Agreement constitutes the entire agreement between the Parties relating to the subject matter. Notwithstanding the foregoing, any collateral, credit support or margin agreement or similar arrangement between the Parties shall, upon designation by the Parties, be deemed part of this Agreement and shall be incorporated herein by reference. This Agreement shall be considered for all purposes as prepared through the joint efforts of the Parties and shall not be construed against one Party or the other as a result of the preparation, substitution, submission or other event of negotiation, drafting or execution hereof. Except to the extent herein provided for, no amendment or modification to this Agreement shall be enforceable unless reduced to writing and executed by both Parties. Each Party agrees if it seeks to amend any applicable wholesale power sales tariff during the term of this Agreement, such amendment will not in any way affect outstanding transactions under this Agreement without the prior written consent of the other Party. Each Party further agrees that it will not assert, or defend itself, on the basis that any applicable tariff is inconsistent with this Agreement. This Agreement shall not impart any rights enforceable by any third party (other than a permitted successor or assignee bound to this Agreement). Waiver by a Party of any default by the other Party shall not be construed as a waiver of any other default. Any provision declared or rendered unlawful by any applicable court of law or regulatory agency or deemed unlawful because of a statutory change (individually or collectively, such events referred to as "Regulatory Event") will not otherwise affect the remaining lawful obligations that arise under this Agreement; and provided, further, that if a Regulatory Event occurs, the Parties shall use their best efforts to reform this Agreement in order to give effect to the original intention of the Parties. The term "including" when used in this Agreement shall be by way of example only and shall not be considered in any way to be in limitation. The headings used herein are for convenience and reference purposes only. All indemnity and audit rights shall survive the termination of this Agreement for two (2) years. This Agreement shall be binding on each Party's successors and permitted assigns.
9.5 Audit
Each Party has the right, at its sole expense and during normal working hours, to examine the records of the other Party to the extent reasonably necessary to verify the accuracy of any statement, charge or computation made pursuant to this Agreement. If any such examination reveals any inaccuracy in any statement, the necessary adjustments in such statement and the payments thereof will be made promptly and shall bear interest calculated at the Interest Rate from the date the overpayment or underpayment was made until paid; provided, however, that no Pro Forma Ver. 2022.02.23 25
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adjustment for any statement or payment will be made unless objection to the accuracy thereof was made prior to the lapse of twelve (12) months from the rendition thereof, and thereafter any objection shall be deemed waived.
9.6 Bankruptcy Issues
The Parties intend that (i) this Agreement constitutes a "forward contract" within the meaning of the United States Bankruptcy Code (the "Bankruptcy Code") or a "swap agreement" within the meaning of the Bankruptcy Code; (ii) all payments made or to be made by one Party to the other Party pursuant to this Agreement constitute "settlement payments" within the meaning of the Bankruptcy Code; (iii) all transfers of Performance Assurance by one Party to the other Party under this Agreement constitute "margin payments" within the meaning of the Bankruptcy Code; (iv) this Agreement constitutes a "master netting agreement" within the meaning of the Bankruptcy Code; and (v) each of SCE and Counterparty are "forward contract merchants" within the meaning of the Bankruptcy Code.
Each Party further agrees that, for purposes of this Agreement, the other Party is not a "utility" as such term is used in 11 U.S.C. Section 366, each Party waives and agrees not to assert the applicability of the provisions of 11 U.S.C. Section 366 in any bankruptcy proceeding wherein such Party is a debtor. In any such proceeding, each Party further waives the right to assert that the other Party is a provider of last resort to the extent such term relates to 11 U.S.C. Section 366 or another provision of 11 U.S.C. Section 101-1532.
9.7 Confidentiality
(a) Neither Party shall disclose the terms or conditions of this Agreement to a third party (other than the Parry's or the Party's Affiliates' officers, directors, employees, lenders, counsel, accountants, advisors, or rating agencies who have a need to know such information and have agreed to keep such terms strictly confidential and to take reasonable precautions to protect against disclosure of such terms) except (i) in order to comply with any applicable law, order, regulation, ruling, summons, subpoena, exchange rule, or accounting disclosure rule or standard, or to make any showing required by any applicable governmental authority; (ii) to the extent necessary for the enforcement of this Agreement; (iii) as may be obtained from a non - confidential source that disclosed such information in a manner that did not violate its obligations to the non -disclosing Party in making such disclosure; (iv) to the extent such information is or becomes generally available to the public prior to such disclosure by a Party; (v) when required to be released in connection with any regulatory proceeding (provided that the releasing Party makes reasonable efforts to obtain confidential treatment of the information being released); (vi) with respect to SCE, as may be furnished to its duly authorized regulatory and governmental agencies or entities, including Pro Forma Ver. 2022.02.23 126
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without limitation the CPUC and all divisions thereof, and to SCE's Procurement Review Group, a group of participants including members of the CPUC and other governmental agencies and consumer groups established by the CPUC in D.02-08-071 and D.03-06-071; provided, SCE shall have no liability to Counterparty in the event of any unauthorized use or disclosure by such entities; or (vii) each Party may disclose the terms of this Agreement to WREGIS. The existence of this Agreement is not subject to this confidentiality obligation; provided that neither Party shall make any public announcement relating to this Agreement unless required pursuant to subsection (i) or (vi) of the foregoing sentence of this Section. The Parties shall be entitled to all remedies available at law or in equity to enforce, or seek relief in connection with, this confidentiality obligation. (b) With respect to information provided under this Agreement, this obligation shall survive for a period of three (3) years following the expiration or termination of this Agreement. [For the purposes of this Section, "Affiliate" for Counterparty shall mean [•] and "Affiliate" for SCE shall mean Edison International.] {SCE Note: Bracketed provision only applicable if Counterparty has Affiliates that have energy trading operations.)
9.8 No Agency
Except as otherwise provided explicitly herein, in performing their respective obligations under this Agreement, neither Party is acting, or is authorized to act, as the other Party's agent.
9.9 Mobile Sierra Doctrine
(a) Absent the agreement of all Parties to the proposed change, the standard of review for changes to any rate, charge, classification, term or condition of this Agreement, whether proposed by a Party (to the extent that any waiver in subsection (b) below is unenforceable or ineffective as to such 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), Federal Power Commission v. Sierra Pacific Power Co., 350 U.S. 348 (1956), and clarified by Morgan Stanley Capital Group, Inc. v. Public Oil. Dist. No. I of Snohomish, 554 U.S. 527 (2008), and NRG Power Marketing LLC v. Maine Public Utility Commission, 558 U.S. 527 (2010) (the `Mobile Sierra' doctrine).
(b) Notwithstanding any provision of Agreement, and absent the prior written agreement of the Parties, each Party, to the fullest extent permitted by applicable laws, for itself and its respective successors and assigns, hereby also expressly and irrevocably waives any rights it can or may have, now or in the future, whether under Sections 205, 206, or 306 of the Federal Power Act or otherwise, to seek to obtain from FERC by any means, directly or Pro Forma Ver. 2022.02.23
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indirectly (through complaint, investigation, supporting a third party seeking to obtain or otherwise), and each hereby covenants and agrees not at any time to seek to so obtain, an order from FERC changing any Section of this Agreement specifying any rate or other material economic terms and conditions agreed to by the Parties.
9.10 Multiple Counterparts
This Agreement may be executed in one or more counterparts, each of which will be deemed to be an original of this Agreement and all of which, when taken together, will be deemed to constitute one and the same agreement. The exchange of copies of this Agreement and of signature pages by facsimile transmission, Portable Document Format (i.e., PDF) or by other electronic means constitutes effective execution and delivery of this Agreement as to the Parties and may be used in lieu of the original Agreement for all purposes.
9.11 Independent Contractors
The Parties are independent contractors. Nothing contained herein shall be deemed to create an association, joint venture, or partnership relationship between the Parties or to impose any partnership obligations or liability on either Party in any way.
9.12 Severability
If any term, section, provision or other part of this Agreement, or the application of any term, section, provision or other part of this Agreement, is held to be invalid, illegal or void by a court or regulatory agency of proper jurisdiction, all other terms, sections, provisions or other parts of this Agreement shall not be affected thereby but shall remain in force and effect unless a court or regulatory agency holds that the provisions are not separable from all other provisions of this Agreement.
9.13 Rules of Construction
(a) The word "or" when used in this Agreement includes the meaning "and/or" unless the context unambiguously dictates otherwise.
(b) Where days are not specifically designated as Business Days, they will be considered as calendar days.
(c) All references to time shall be in PPT unless stated otherwise. (d) Headings are included for convenience only and are not to be considered in interpretation.
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(e) References in the singular include references to the plural and vice versa, pronouns having masculine or feminine gender include the other, and words denoting natural persons include partnerships, firms, companies, corporations, joint ventures, trusts, associations, organizations or other entities, whether or not having a separate legal personality. (f) Other grammatical forms of defined words or phrases have corresponding meanings.
(g) Unless otherwise specified herein, where the consent of a Party is required, such consent may not be unreasonably withheld, conditioned or delayed. (h) References to any natural person, Governmental Authority, publication, website, market price index, regulatory proceeding, corporation, partnership or other legal entity include successors and lawful assigns. (i) All references to money or dollars are to U.S. dollars. (j) Examples are for purposes of illustration of the applicable concept only and are not intended to constitute a representation, warranty or covenant concerning the example itself or the matters assumed for purposes of such example.
(k) If there is a conflict between an example and the text hereof, the text will govern.
(1) Each term hereof is to be construed simply according to its fair meaning and not strictly for or against either Party.
(m) No term hereof is to be construed against a Party on the ground that the Party is the author or drafter of that provision.
(n) Each Party expressly agrees to not utilize in any dispute hereunder any rule of construction that resolves the interpretation of any provision against the drafting Party.
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Contract ID # Q SCE — €Counterpar(y)
In WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed as of the Effective Date first written:
{COUNTERPARTY LEGAL NAME},
a {type of organization).
By:
Name:
Title:
Date:
SOUTHERN CALIFORNIA EDISON
COMPANY,
a California corporation.
By:
Name:
Title:
Date:
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Appendix A — Defined Terms SCE — {Counterparty}
APPENDIX A
DEFINED TERMS
["Act" means [•].] {SCE Note: Cite the state enabling and other relevant statutes applicable to Governmental Entity or Public Power System. Defined term is only included if Counterparty is a Governmental Entity or Public Power System.} "Affiliate" means, with respect to any person, any other person (other than an individual) that, directly or indirectly, through one or more intermediaries, controls, or is controlled by, or is under common control with, such person. For this purpose, "control" means the direct or indirect ownership of fifty percent (50%) or more of the outstanding capital stock or other equity interests having ordinary voting power. "Agreement" has the meaning specified in the introductory paragraph hereof. "Arbitrator" has the meaning provided in Section 9.2(b)(2). "Automated Clearing House", or "ACH" means that specific electronic network for financial transactions and fund transfers managed by the Automated Clearing House Network.
"Bankrupt" means with respect to any entity, such entity (i) files a petition or otherwise commences, authorizes or acquiesces in the commencement of a proceeding or cause of action under any bankruptcy, insolvency, reorganization or similar law, or has any such petition filed or commenced against it, (ii) makes an assignment or any general arrangement for the benefit of creditors, (iii) otherwise becomes bankrupt or insolvent (however evidenced), (iv) has a liquidator, administrator, receiver, trustee, conservator or similar official appointed with respect to it or any substantial portion of its property or assets, or (v) is generally unable to pay its debts as they fall due. "Bankruptcy Code" has the meaning provided in Section 9.6. "Business Day" means any day except a Saturday, Sunday, a Federal Reserve Bank holiday, or the Friday immediately following the U.S. Thanksgiving holiday. A Business Day shall open at 8:00 a.m. and close at 5:00 p.m. local time for the relevant Party's principal place of business. The relevant Party, in each instance unless otherwise specified, shall be the Party from whom the notice, payment or delivery is being sent and by whom the notice or payment or delivery is to be received. "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.
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"Calculation Period" means each calendar month during the Delivery Period. "California RPS-Eligible Electric Energy" means electric energy from an Eligible Renewable Energy Resource, as such term is defined in Public Utilities Code Section 399.12 and 399.16.
"CEC" means the California Energy Commission or its regulatory successor. "Claims" means all third party claims or actions, threatened or filed and, whether groundless, false, fraudulent or otherwise, that directly or indirectly relate to the subject matter of an indemnity, and the resulting losses, damages, expenses, attorneys' fees and court costs, whether incurred by settlement or otherwise, and whether such claims or actions are threatened or filed prior to or after the termination of this Agreement. "Claiming Party" has the meaning provided in Section 2.3. "Contract Price" shall have the meaning provided in Section 1.2. "Contract Quantity" shall have the meaning provided in Section 1.2. "Energy Price" shall be Index.
"Costs" means, with respect to the Non -Defaulting Party, brokerage fees, commissions and other similar third party transaction costs and expenses reasonably incurred by such Party either in terminating any arrangement pursuant to which it has hedged its obligations or entering into new arrangements which replace the transactions contemplated under the Agreement; and all reasonable expenses (excluding attorneys' fees) incurred by the Non -Defaulting Party in connection with the termination of this Agreement.
"CPUC" means the California Public Utilities Commission. "CPUC Approval" means a decision of the CPUC that (i) is final and no longer subject to appeal, which approves the Agreement in full and in the form presented on terms and conditions acceptable to SCE in its sole discretion, including without limitation terms and conditions related to cost recovery and cost allocation of amounts paid to SCE or to Counterparty under the Agreement; and (ii) does not contain conditions or modifications unacceptable to SCE, in SCE's sole discretion.
"Credit Rating" means with respect to any entity, the rating then assigned to such entity's unsecured, senior long-term debt or deposit obligations (not supported by third party credit enhancements) by the Ratings Agencies. If no rating is assigned to such entity's unsecured, senior long-term debt or deposit obligations the Ratings Agencies, then "Credit Rating" shall mean the general corporate credit rating or long-term issuer rating assigned to such entity by the Ratings Agencies. If any entity is rated by more than one Ratings Agency and the ratings are at different levels, then "Credit Rating" means the lowest such rating.
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"Day -Ahead Market" has the meaning set forth in the Tariff. "Defaulting" has the meaning provided in Section 5.1.
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"Delivered Energy" means the California RPS-Eligible Electric Energy from a Project that is delivered and scheduled into either the Real Time -Market and/or Day -Ahead Market by SCE on behalf of Counterparty at the Delivery Point. "Delivery Point" has the meaning provided in Section 1.2. "Delivery Period" has the meaning provided in Section 1.2. "Departed Load Customers" has the meaning provided in the Recitals. "Early Termination Date" has the meaning provided in Section 5.2. "Effective Date" has the meaning provided in the introductory paragraph of this Agreement.
"Eligible RPS PCIA Portfolio" has the meaning provided in the Recitals. "Event of Default" has the meaning set forth in Section 5.1. "Federal Funds Effective Rate" means, for any given month, the average of the annual interest rates reported for all weekdays in the month opposite the caption "Federal funds (effective)" as set forth in the H.15 release, or any successor publication, published by the Board of Governors of the Federal Reserve System.
"Force Majeure" means an event or circumstance which prevents one Party from performing its obligations under this Agreement, which event or circumstance was not anticipated as of the Effective Date, which is not within the reasonable control of, or the result of the negligence of, the Claiming Party, and which, by the exercise of due diligence, the Claiming Party is unable to overcome or avoid or cause to be avoided.
Force Majeure shall not be based on (i) the loss of Counterparty's markets; (ii) Counterparty's inability economically to use or resell the Product purchased hereunder; (iii) the loss or failure of SCE's supply; or (iv) SCE's ability to sell the Product at a price greater than the Contract Price. Neither Party may raise a claim of Force Majeure based in whole or in part on curtailment by a Transmission Provider unless (i) such Party has contracted for firm transmission with a Transmission Provider for the Product to be delivered to or received at the Delivery Point and (ii) such curtailment is due to "force majeure" or "uncontrollable force" or a similar term as defined under the Transmission Provider's tariff; provided, however, that existence of the foregoing factors shall not be sufficient to conclusively or presumptively prove the existence of a Force Majeure absent a showing of other facts and circumstances which in the aggregate with such factors establish that a Force Majeure as defined in the first sentence hereof has occurred. [If the Claiming Party is a Governmental Entity or Public Power System, Force Majeure does Pro Forma Ver. 2022.02.23
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not include any action taken by the Governmental Entity or Public Power System in its governmental capacity.] {SCE Note: Bracketed sentence is only included if Counterparty is a Governmental Entity or Public Power System.}
"Forward Price Assessments" means quotations solicited or obtained in good faith from regularly published and widely -distributed forward price assessments from a broker that is not an Affiliate of either Party and who is actively participating in markets for the relevant Products.
"Gains" means, with respect to any Party, an amount equal to the present value of the economic benefit to it, if any (exclusive of Costs), resulting from the termination of this Agreement, determined in a commercially reasonable manner in accordance with Section
5.2. "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.
"Governmental Charges" shall have the meaning provided in Section 8.3(b). ["Governmental Entity or Public Power System" means a municipality, county, governmental board, public power authority, public utility district, joint action agency, or other similar political subdivision or public entity of the United States, one or more States or territories or any combination thereof.] {SCE Note: Defined term is only included if Counterparty is a Governmental Entity or Public Power System.} "Green Attributes" means any and all credits, benefits, emissions reductions, offsets, and allowances, howsoever entitled, attributable to the generation from a Project, and its avoided emission of pollutants. Green Attributes include but are not limited to Renewable Energy Credits, as well as:
(1) Any avoided emission of pollutants to the air, soil or water such as sulfur oxides (SOX), nitrogen oxides (NOX), carbon monoxide (CO) and other pollutants;
(2) Any avoided emissions of carbon dioxide (CO2), methane (CH4), nitrous oxide, hydrofluorocarbons, perfluorocarbons, sulfur hexafluoride and other greenhouse gases (GHGs) that have been determined by the United Nations Intergovernmental Panel on Climate Change, or otherwise by law, to contribute to the actual or potential threat of altering the Earth's climate by trapping heat in the atmosphere;)
Avoided emissions may or may not have any value for GHG compliance purposes. Although avoided emissions are included in the list of Green Attributes, this inclusion does not create any right to use those avoided emissions to comply with any GHG regulatory program.
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(3) The reporting rights to these avoided emissions, such as Green Tag Reporting Rights.
Green Tag Reporting Rights are the right of a Green Tag Purchaser to report the ownership of accumulated Green Tags in compliance with federal or state law, if applicable, and to a federal or state agency or any other party at the Green Tag Purchaser's discretion, and include without limitation those Green Tag Reporting Rights accruing under Section 1605(b) of The Energy Policy Act of 1992 and any present or future federal, state, or local law, regulation or bill, and international or foreign emissions trading program. Green Tags are accumulated on a MWh basis and one Green Tag represents the Green Attributes associated with one (1) MWh of energy.
Green Attributes do not include:
(i) Any energy, capacity, reliability or other power attributes from a Project, (ii) Production tax credits associated with the construction or operation of a Project and other financial incentives in the form of credits, reductions, or allowances associated with the Project that are applicable to a state or federal income taxation obligation,
(iii) Fuel -related subsidies or "tipping fees" that may be paid to SCE to accept certain fuels, or local subsidies received by the generator for the destruction of particular preexisting pollutants or the promotion of local environmental benefits, or
(iv) Emission reduction credits encumbered or used by a Project for compliance with local, state, or federal operating and/or air quality permits.
If a Project is a biomass or biogas facility and SCE receives any tradable Green Attributes based on the greenhouse gas reduction benefits or other emission offsets attributed to its fuel usage, it shall provide Counterparty with sufficient Green Attributes to ensure that there are zero (0) net emissions associated with the production of electricity from such Project.
"Index" means, for each Scheduling Period, the applicable CAISO market price for the CAISO Pricing Node for the applicable portion of a Project for each applicable period as published by the CAISO on the CAISO website; or any successor thereto, unless a substitute publication and/or index is mutually agreed to by the Parties. "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.
"IOUs" has the meaning provided in the Recitals.
"JAMS" has the meaning provided in Section 9.2(b)(1).
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"Load Share Percentage" means a percentage which reflects a Counterparty's forecasted annual load share, as has been determined through the annual Meet and Confer Process for each PCIA Vintage Year.
"Losses" means, with respect to any Party, an amount equal to the present value of the economic loss to it, if any (exclusive of Costs), resulting from termination of the Agreement, determined in a commercially reasonable manner in accordance with Section
5.2. "LSE" has the meaning provided in the Recitals.
"Market Quotation Average Price" means the arithmetic mean of the quotations solicited in good faith from not less than three (3) Reference Market -Makers; provided, however, that the Party obtaining the quotes shall use reasonable efforts to obtain good faith quotations from at least five (5) Reference Market -Makers and, if at least five (5) such quotations are obtained, the Market Quotation Average Price shall be determined by disregarding the highest and lowest quotations and taking the arithmetic mean of the remaining quotations. The quotations shall be based on the offers to sell or bids to buy, as applicable, obtained for transactions substantially similar to those contemplated under this Agreement. The quote must be obtained assuming that the Party obtaining the quote will provide sufficient credit support for the proposed transaction. Each quotation shall be obtained in good faith by such Party, to the extent reasonably practicable, as of the same day and time (without regard to different time zones) on or as soon as reasonably practicable after the relevant Early Termination Date, such day and time as of which those quotations will be selected shall be specified in accordance with Section 5.2. If fewer than three (3) quotations are obtained, it will be deemed that the Market Quotation Average Price in respect of this terminated Agreement cannot be determined. "Mediator" has the meaning provided in Section 9.2(b)(1). "Meet and Confer Process" shall mean the annual meetings between the Counterparty and SCE where the Parties determine the Load Share Percentage for each PCIA Vintage Year among other things.
"Merger Event" means, with respect to a Party, that such Party consolidates or amalgamates with, merges into or with, or transfers substantially all its assets to another entity and (i) the resulting entity fails to assume all the obligations of such Party hereunder, or (ii) the benefits of any credit support provided by such Party pursuant to Article 7, fail to extend to the performance of such resulting, surviving or transferee entity's obligations hereunder, or (iii) the resulting entity's creditworthiness is materially weaker than that of such Party immediately prior to such action. The creditworthiness of the resulting entity shall not be deemed to be `materially weaker' so long as the resulting entity maintains a Credit Rating of at least that of the applicable Party, as the case may be, immediately prior to the consolidation, merger or transfer. "Monthly Cash Settlement Amount" has the meaning provided in Section 3.1.
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Appendix A — Defined Terms
"Moody's" means Moody's Investor Services, Inc. or its successor.
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"MW" means megawatt (or 1,000 kilowatts) of alternating current electric energy generating capacity.
"New Voluntary Allocation Agreements" has the meaning provided in Section 3.6. "Non -Defaulting Party_" has the meaning provided in Section 5.2. "PCIA" has the meaning provided in the Recitals.
"PCIA-Eligible LSEs" has the meaning provided in the Recitals. "PCIA Vinta eg Year" means the calendar year that the contracts in SCE's RPS PCIA Portfolio are executed.
"Performance Assurance" means all collateral that is provided by one Party to another Party, whether in the form of cash, letters of credit, or combination thereof. "Potential Event of Default" means an event which, with notice or passage of time or both, would constitute an Event of Default.
"Pricing Node" has the meaning set forth in the Tariff. "Product" has the meaning provided in Section 1.2.
"Project" has the meaning provided in Section 1.2.
"Project Contract Quantity" has the meaning provided in Section 1.2. "Ratings Agency" means any of S&P and Moody's, and any other ratings agency agreed by the Parties (collectively the "Rating Agencies").
"Real -Time Market" has the meaning set forth in the Tariff. "REC Price" means the "RPS Adder" for the calendar year in which the RECs are generated, published by the Energy Division of the CPUC as the "Calculation of the Market Price Benchmarks for the Power Charge Indifference Adjustment Forecast and True Up", which may be revised in future publications by the CPUC as the final "RPS Adder."
"Reference Market -Maker" means a leading dealer in the relevant market that is not an Affiliate of either Party and that is selected by a Party in good faith among dealers of the highest credit standing which satisfy all the criteria that such Party applies generally at the time in deciding whether to offer or to make an extension of credit. Such dealer may be represented by a broker.
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"Re ug latory Event" has the meaning provided in Section 9.4. "Renewable Energy Credit" or "REC" has the meaning set forth in CPUC Decision 08- 08-028, as such definition may be modified by the CPUC or applicable law from time to time.
"Responsible Officer" shall mean the Chief Financial Officer, Treasurer or any Assistant Treasurer.
"Revised Load Share Percentages" has the meaning provided in Section 2.6. "RPS" means the California Renewables Portfolio Standard Program as codified at California Public Utilities Code Section 399.11 et seq., and any decisions by the CPUC related thereto.
"RPS PCIA Portfolio" has the meaning provided in the Recitals. "S&P" means the Standard & Poor's Rating Group (a division of McGraw-Hill, Inc.) or its successor.
"Scheduling Period" means each hour of the Delivery Period for a Project. "Settlement Amount" means, with respect to this Agreement and the Non -Defaulting Party, the Losses or Gains, and Costs, expressed in U.S. Dollars, which such party incurs as a result of the liquidation of the Agreement pursuant to Section 5.2. ["Special Fund" means a fund or account of the Governmental Entity or Public Power System set aside and or pledged to satisfy the Governmental Entity's or Public Power System's obligations hereunder out of which amounts shall be paid to satisfy all of the Governmental Entity's or Public Power System's obligations under this Agreement for the entire Delivery Period.] {SCE Note: Defined term is only included if'Counterparty is a Governmental Entity or Public Power System.;
"Specified Energy Transaction" means any transaction (including an agreement with respect to any such transaction) or agreement now existing or hereafter entered into between SCE and Counterparty, which is a transaction under the Edison Electric Institute Master Power Purchase and Sale Agreement, International Swaps and Derivatives Association Master Agreement, the North American Energy Standards Board Base Contract for Purchase and Sale of Natural Gas, the WSPP Agreement, or under any other agreement with respect to the purchase, sale, or transfer of (a) wholesale physical electric energy, capacity, ancillary services or resource adequacy benefits; (b) wholesale physical natural gas; (c) transmission services or capacity, (d) emissions (including greenhouse gas emissions) related credits, allowances or offsets, or (e) financial derivative products related to any of the foregoing.
"Tenn" has the meaning specified in Section 1.1.
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"Termination Payment" has the meaning provided in Section 5.3.
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SCE — {Counterparty}
"Transmission Provider" means any entity or entities transmitting or transporting the Product on behalf of SCE to the Delivery Point under this Agreement. "Vintage Year" means the calendar year the WREGIS Certificate is associated with through the generation of electric energy.
"WREGIS" means the Western Renewable Energy Generation Information System or other process recognized under applicable laws for the registration, transfer or ownership of Green Attributes.
"WREGIS Account Holder" means "Account Holder" as defined by WREGIS in the WREGIS Operating Rules.
"WREGIS Certificate" means "Certificate" as defined by WREGIS in the WREGIS Operating Rules.
"WREGIS Operating ules_" means the operating rules and requirements adopted by WREGIS, as amended, supplemented or replaced from time to time.
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SCE — [CounterparN
APPENDIX B
PROJECTS
[A spreadsheet resulting from the Meet and Confer Process will be attached and will include the following information for each Project:
• Contract ID
• Project Name
• PCIA Vintage Year
• Resource Type
• PCC
• In-State/Out of State
• Resource ID
• CEC ID
• WREGIS ID
• Total Yearly Available Allocation (MWh) per vintage
• LSE's Yearly Available Allocation (MWh) per vintage
• Load Share Percentage; and
• End of Delivery Term]
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SCE — [Counterpartyl
APPENDIX C
NOTICES
{Counter party Legal Name}
Southern California Edison Company
All Notices:
All Notices:
Street:
2244 Walnut Grove Ave., G.O.1, Quad I
Rosemead, CA 91770
City: Zip:
Attn:
Attn: Director, Energy Contracts Management
Phone:
Phone: (707) 595-0451
Electronic Facsimile: (732) 289-9854
Email: [email protected]
Duns: 006908818
Email:
Duns:
Federal Tax ID Number:
Federal Tax ID Number: 95-1240335
Invoices:
Invoices
Attn:
Attn: EPM & Contract Settlements
Phone: (626) 302-8908
Phone:
Email:
Email: PPFDPowerSettlensce.com
Trading:
Trading:
Attn:
Attn: [•]
Phone: (626) 307-4425 (Day Ahead) or (626) 307-
Phone:
Email:
4453 (Real Time)
Facsimile: [•]
E-mail:
Scheduling:
Scheduling:
Attn:
Attn: Manager or Day Ahead Operations
Phone: (626) 307-4425 (Day Ahead) or (626) 307-
Phone:
Email:
4453 (Real Time)
Facsimile: (626) 307-4413
E-mail: [email protected]
Payments:
Payments:
Attn:
Attn: EPM & Contract Settlements
Phone: 626-302-8908
Phone:
Email:
E-mail: [email protected]
Credit and Collections:
Credit:
Attn:
Attn: Manager of Credit Risk
Phone: (626) 302-3672
Phone:
Email:
Collateral:
Southern California Edison Company
Attn: Manager of Risk Operations & Collateral
Management
2244 Walnut Grove Avenue, GO Quad 2B
Rosemead, CA 91770
Phone: (626) 302-0023
Email: [email protected]
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With additional Notices of an Event of Default or
Potential Event of Default to:
Attn: _
Phone:
Email:
Pro Forma Ver. 2022.02.23
Voluntary Allocation Agreement
v. 2022.02.23
SCE — [CounterparN
With additional Notices of an Event of Default or
Potential Event of Default to:
Attn: Director and Managing Attorney Power
Procurement Section
E-mail: [email protected]
42 Agenda Page 92
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