Confirmation for Bilateral Import Capability Transfer
This
confirmation
letter
(“Confirmation”)
confirms
the
Transaction
between
______________________ (“Seller”) and ______________________ (“Buyer”), each
individually a “Party” and together the “Parties”, dated as of _______________ (the
“Confirmation Effective Date”) in which Seller agrees to provide to Buyer the right to the
Product, as such term is defined in Section 3 of this Confirmation. This Transaction is governed
by the Edison Electric Institute Master Power Purchase and Sale Agreement between the
Parties, effective as of ______________________, along with the Cover Sheet, any
amendments and annexes thereto (the “Master Agreement”) and including, Paragraph 10 of the
EEI Collateral Annex to the Master Agreement (Paragraph 10 and the Collateral Annex are both
referred to herein as the “Collateral Annex”) (the Master Agreement and the Collateral Annex
shall be collectively referred to as the “EEI Agreement”). The EEI Agreement and this
Confirmation shall be collectively referred to herein as the “Agreement”. Capitalized terms used
but not otherwise defined in this Confirmation have the meanings ascribed to them in the EEI
Agreement or the Tariff (defined herein). To the extent that this Confirmation is inconsistent
with any provision of the EEI Agreement, this Confirmation shall govern the rights and
obligations of the Parties hereunder.
1. Definitions
1.1
”Bilateral Import Capability Transfer” is the transfer of Remaining Import
Capability from one Market Participant to another, as described in the Tariff.
1.2
“Buyer” has the meaning specified in the introductory paragraph.
1.3
“CAISO” means the California Independent System Operator Corporation, or any
successor entity performing the same functions.
1.4
“Capacity Flat Price” means the price specified in the Capacity Flat Price Table in
Section 4.1.
1.5
“Confirmation” has the meaning specified in the introductory paragraph.
1.6
“Confirmation Effective Date” has the meaning specified in the introductory
paragraph.
1.7
“Contract Period” means the months defined in Section 3.4, inclusive.
1.8
“Contract Price” means, for any Contract Period, the Capacity Flat Price for such
period.
1.9
“Contract Quantity” has the meaning set forth in Section 3.4.
1.10
“Contract Term” has the meaning set forth in Section 2.1.
1.11
“CPUC” means the California Public Utilities Commission.
1.12
“Credit Rating” means, with respect to any entity, (i) the rating then assigned to
such entity’s unsecured, senior long-term debt obligations (not supported by third
party credit enhancements), or (ii) if such entity does not have a rating for its
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unsecured, senior long-term debt obligations, then the rating assigned to such
entity as an issuer rating by S&P and/or Moody’s. If the entity is rated by both
S&P and Moody’s and such ratings are not equivalent, the lower of the two
ratings shall determine the Credit Rating. If the entity is rated by either S&P or
Moody’s, but not both, then the available rating shall determine the Credit Rating.
1.13
“Governmental Body” means any federal, state, local, municipal or other
government; any governmental, regulatory or administrative agency, commission
or other authority lawfully exercising or entitled to exercise any administrative,
executive, judicial, legislative, police, regulatory or taxing authority or power; and
any court or governmental tribunal.
1.14
“Investment Grade Rating” means a Credit Rating of “BBB- or above” by S&P
and “Baa3 or above” by Moody’s if rated by both S&P and Moody’s or “BBB- or
above” by S&P or “Baa3 or above” by Moody’s if rated by S&P or Moody’s but
not both.
1.15
“Master Agreement” has the meaning specified in the introductory paragraph.
1.16
“Moody’s” means Moody’s Investors Services, Inc. or its successor.
1.17
“Net Qualifying Capacity” has the meaning set forth in the Tariff.
1.18
“One-Time Payment” has the meaning specified in Section 4.1.
1.19
“Product” has the meaning specified in Section 3.1.
1.20
“S&P” means the Standard & Poor’s Rating Group (a division of McGraw-Hill,
Inc.) or its successor.
1.21
“Seller” has the meaning specified in the introductory paragraph.
1.22
“Tariff” means the tariff and protocol provisions, including any current CAISOpublished “Operating Procedures” and “Business Practice Manuals,” as amended
or supplemented from time to time, of the CAISO.
1.23
“Transaction” has the meaning specified in the introductory paragraph.
2. Term
2.1
Contract Term
The “Contract Term” shall mean the period of time commencing upon the Confirmation
Effective Date and continuing until the later of (a) the expiration of the Contract Period or
(b) the date the Parties’ obligations under the Agreement have been fulfilled.
2.2
Binding Nature
This Agreement shall be effective and binding as of the Confirmation Effective Date.
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3. Transaction
3.1
Product
Seller shall transfer in the manner set forth in Section 3.3, to Buyer the Remaining
Import Capability, as such term is defined by the Tariff (the “Product”) in the Contract
Quantity, for the Contract Period, and at the applicable Capacity Flat Price.
3.2
Delivery Point
Bilateral Import Capability Transfer
Name
CAISO BG/MSL Name
3.3
Performance
Within five (5) Business Days of the Confirmation Effective Date, Seller shall transfer to
Buyer the Product in the amount of the Contract Quantity by registering the transfer with
the CAISO as a Bilateral Import Transfer Capability as such terms is defined by the
Tariff, and completing any other action of documentation required by the CAISO to effect
such transfer. Upon Seller registering transfer with CAISO, Buyer shall immediately
confirm the transfer with CAISO by e-mail and CAISO shall indicate successful transfer
to Buyer and Seller by e-mail within 11 business days of transfer request.
3.4
Contract Quantity:
For the Contract Period, Seller shall transfer the Product in the total amount (“Contract
Quantity”), as follows:
Contract Quantity Table
Contract Month
Month
Quantity (MW)
1
2
3.5
Buyer’s Re-Sale of Product
Buyer may re-sell all or a portion of the Product.
4. Payment
4.1
One-Time Payment
In accordance with the terms of Article Six of the Master Agreement and if Buyer or
Buyers Guarantor does not maintain an Investment Grade Rating or has no Credit
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Rating, Buyer shall make a One Time Payment in advance to Seller for the Product
within two (2) Business Days following the Confirmation Effective Date and before Seller
transfers the Product under Section 3.3. If Buyer or Buyers Guarantor maintains an
Investment Grade Rating and Buyer has established credit with Seller equal to or above
the One-Time Payment, then Buyer shall make a One-Time Payment to the Seller for
the Product within five (5) Business Days after the later of (a) Seller’s performance and
CAISO e-mail indicating successful transfer, as described in Section 3.3 or (b) receipt of
Seller’s invoice. This payment (“One-Time Payment”) is calculated as follows:
One-Time Payment =
where:
Ai = Contract Price i (in $/kW-month) for Contract Month i
Bi = Contract Quantity i (in MW) transferred by Seller for Contract Month i
The One-Time Payment shall be rounded to two decimal places. In no case shall the
One-Time payment be less than zero.
CAPACITY FLAT PRICE TABLE
Contract
Month
Month
Capacity Flat Price
($/kW-month)
1
2
5. Confidentiality
Notwithstanding Section 10.11 of the Master Agreement, the Parties agree that Buyer and
Seller may disclose this Agreement to the CPUC, CAISO and any Governmental Body, as
required by Applicable Law; provided, that each disclosing Party shall use reasonable efforts
to limit, to the extent possible, the ability of any such applicable Governmental Body,
CAISO, or SC to further disclose such information. Notwithstanding the foregoing, the
Parties may disclose the terms of this Confirmation to the CAISO to effectuate Seller’s
performance and the transfer of the Product and the CAISO may publicly disclose the
transfer of the Product from Seller to Buyer as indicated in the Tariff promptly following
Seller’s performance. In addition, in the event Buyer resells all or any portion of the Product,
Buyer shall be permitted to disclose to the other party to such resale transaction all such
information necessary to effect such resale transaction, other than the Contract Price.
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BUYER
SELLER
[INSERT COMPANY NAME]
[INSERT COMPANY NAME]
By: ________________________________
By:_______________________________
Name:______________________________
Name:_____________________________
Title:________________________________
Title:______________________________
Date:_______________________________
Date:______________________________
=
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