HomeMy WebLinkAboutAgenda Report - February 15, 2023 C-11S , t ror
r
CALI>"ORNIA
COUNCIL COMMUNICATION
AGENDA ITEM C• I I
AGENDA TITLE: Adopt Resolution Authorizing City Manager to Execute Third Phase Agreement with Northern
California Power Agency for Purchase Agreements with Geysers Power Company, LLC
MEETING DATE: February 15, 2023
PREPARED BY: Electric Utility Director
RECOMMENDED ACTION: Adopt a resolution authorizing the City Manager to execute a Third Phase
Agreement with the Northern California Power Agency (NCPA) for Purchase
Agreements with the Geysers Power Company, LLC (Geysers).
BACKGROUND INFORMATION: California Renewables Portfolio Standard (RPS) requirements necessitate
60 percent of the City's retail energy sales be supplied by renewable energy by
2030 and every year thereafter.
LEU's existing generation resources at NCPA in addition to more recently acquired power contract resources including the
Astoria 2 Solar Project (2016), South Feather Water and Power Agency Hydroelectric Project (2021), and Antelope 1 B
Solar Project (2022) will enable LEU to meet current RPS requirements through at least 2024. While Lodi continues to
work with NCPA on the identification of and due diligence associated with additional power resources to meet 2030 RPS
requirements, LEU has just recently completed efforts on the proposed project described herein.
Selection of this project was a result of a competitive solicitation conducted by NCPA on behalf of members in 2020 and
subsequently amended in 2022 to identify and select cost-effective resources to support member RPS obligations.
Located in Lake and Sonoma Counties, Geysers owns and operates multiple geothermal generating plants. Through
negotiations with NCPA on behalf of Lodi and other members, Geysers has agreed to sell and deliver the renewable
energy and resource adequacy capacity to NCPA for the benefit of its members. Negotiations on the terms and conditions
associated with the Purchase Agreements (Agreements) with Geysers are now complete, As a result of such effort,
NCPA, in coordination with the project participants noted below, has negotiated two Agreements with Geysers for 1)
resource adequacy capacity; and 2) renewable energy products.
The preliminary share of facility output for each of the NCPA participant members is provided below. On the effective date
of the Third Phase Agreement, Santa Clara (the initial participant) will hold the full project participation percentage;
however Lodi will exercise its right to accept a transfer of the portion identified below thereby becoming a project
participant.
Participant
Percentaae
2025-2026 MW
2027-2036 MW
Alameda
5.0%
2.50
5.00
Biggs
0.4%
0.20
0.40
Gridley
0.6%
0.30
0.60
Lodi
10,0%
5,00
10.00
Lompoc
1.7%
0.85
1.70
Palo Alto
10.0%
5.00
10.00
Port of Oakland
2.3%
1.15
2.30
Santa Clara
70.0%
35.00
70.00
APPROVED:e,«v.h, ;,., I1P,�W
Stephen Schwabauer, City Manager
Adopt Resolution Authorizing Clty Manager to Execute Third Phase Agreement with Northern California Power Agency for Purchase Agreements with Geysers Power
Company, LLC
February 15, 2023
Page 2
The first two years will provide a total of 50 megawatts (MW), while the remaining 10 years will provide a total of 100 MW
for all project participants.
Under the terms of the Agreements, NCPA will purchase, on behalf of the participants noted above, the electrical energy
output, resource adequacy capacity, renewable energy credits, and all other environmental attributes associated with the
geothermal generating plants from Geysers. Delivery under the terms of the Agreements is scheduled to start January 1,
2025 for a contract term of 12 years. Geysers' geothermal plants under these Agreements are guaranteed to qualify as
Portfolio Content Category 1 under RPS guidelines. Lodi's contracted share of 5 MW will provide geothermal energy to
meet approximately 7.5 percent of Lodi's annual retail load for 2025 and 2026. The 10 MW starting in 2027 will provide
about 15 percent of Lodi's annual retail load each year thereafter through 2036.
The contract price is fixed for the 12 -year life of the contract and has been disclosed in a confidential meeting of the City's
Risk Oversight Committee. Due to sensitivities associated with similar contract negotiations, Geysers has requested that
the contract price remain confidential and is therefore not included as part of this staff report and has been redacted from
the corresponding agreements included with this agenda item.
During each calendar year, the amount paid for energy will be based on actual energy delivered. In addition, the resource
adequacy capacity will be used to meet Lodi's resource adequacy obligations. Lodi will not have an ownership interest in
these geothermal generating plants and will not incur any capital expenditures. The total annual cost of energy, capacity,
and renewable credits is estimated at approximately $2.8 million per year for 2025 and 2026, increasing to approximately
$5.5 million annually through 2036,
Pursuant to the NCPA project development process, as described in the NCPA Amended and Restated Facilities
Agreement, In order for NCPA to move forward on behalf of participating members, a Third Phase Agreement is needed
to enable NCPA to enter into the Agreements with Geysers on behalf of the participants.
On January 26, 2023, the Risk Oversight Committee received a report on the Geysers Geothermal Project and
recommended approval of the Third Phase Agreement with NCPA.
FISCAL IMPACT: Actual costs associated with this project will be based on energy delivered. Estimates for
the first two years are approximately $2.8 million annually. Subsequent years are
estimated at approximately $5.5 million annually. This agreement provides a long-term
fixed contract that will help reduce future market energy purchases and thereby reduce
LEU's exposure to potential market volatility and risk.
FUNDING AVAILABLE: Costs associated with this project will be funded by Greenhouse Gas Fund Revenue
(Fund 508) and/or Electric Utility Operating Funds (Fund 500) and will be appropriated as
part of the annual budget process for power supply costs.
Andrew Keys
Andrew Keys
Deputy City Manager/Internal Services Director
Jeff Berkheimer
Electric Utility Director
Signature: OMA t
Email: akeys@lodi.gov
THIRD PHASE AGREEMENT
FOR
PURCHASE AGREEMENTS
WITH
GEYSERS POWER COMPANY, LLC
TABLE OF CONTENTS
Section1.
Definitions....................................................................................................3
Section2.
Purpose.........................................................................................................9
Section 3.
Sale and Purchase of Product....................................................................
9
Section 4.
Billing and Payments................................................................................10
Section 5.
Security Deposit Administration.............................................................13
Section 6.
Cooperation and Further Assurances.....................................................18
Section 7.
Participant Covenants and Defaults.......................................................19
Section 8.
Administration of Agreement.................................................................22
Section 9.
Transfer of Rights by Participants...........................................................23
Section 10.
Term and Termination..............................................................................24
Section 11.
Withdrawal of Participants......................................................................
25
Section 12.
Settlement of Disputes and Arbitration.................................................25
Section 13.
Miscellaneous.............................................................................................
25
EXHIBIT A.
Project Participation Percenages............................................................38
EXHIBITB.
PPA..............................................................................................................40
I
THIRD PHASE AGREEMENT FOR GEYSERS POWER COMPANY PROJECT
This THIRD PHASE AGREEMENT ("this Agreement") is dated as of
December 22 , 20 22 by and among the Northern California Power Agency, a joint
powers agency of the State of California ("NCPA"), and the signatories to this Agreement
other than NCPA ("Participants"). NCPA and the Participants are referred to herein
individually as a "Party" and collectively as the "Parties"
RECITALS
A. NCPA has heretofore been duly established as a public agency pursuant to
the Joint Exercise of Powers Act of the Government Code of the State of California and,
among other things, is authorized to acquire, construct, finance, and operate buildings,
works, facilities, and improvements for the generation and transmission of electric
capacity and energy for resale.
B. Each of the Participants is a signatory to the Joint Powers Agreement which
created NCPA and therefore is a Member.
C. Each of the Participants to this Agreement have executed the Amended and
Restated Facilities Agreement, dated October 1, 2014, which establishes the framework
under which Project Agreements are created for the development, design, financing,
construction, and operation of specific NCPA Projects.
D. The Participants desire NCPA to enter into the following two agreements
with Geysers Power Company, LLC ("Seller") for the benefit of the Participants'
THIRD PHASE AGREEMENT FOR GEYSERS POWER COMPANY PROJECT
customers: (1) Western Systems Power Pool Agreement Confirmation between Northern
California Power Agency and Geysers Power Company, LLC, to purchase electric capacity
(individually, "RA Agreement"); and (2) Western Systems Power Pool Agreement
Confirmation between Geysers Power Company, LLC and Northern California Power
Agency, to purchase renewable energy (individually, "RPS Agreement"). The RA
Agreement and the RPS Agreement are collectively referred herein as the Purchase
Agreements, attached hereto as Exhibit B.
E. Each Participant is authorized by its Constitutive Documents to obtain
electric capacity and energy for its present or future requirements, through contracts with
NCPA or otherwise.
F. To enable NCPA to enter into the Purchase Agreements on behalf of the
Participants, pursuant to the terms and conditions of the Amended and Restated Facilities
Agreement, NCPA and the Participants wish to enter into this Agreement to provide all
means necessary for NCPA to fulfill obligations incurred on behalf of NCPA and the
Participants pursuant to the Purchase Agreements, and to enable and obligate the
Participants to take delivery of and pay for such electric capacity and energy and to pay
NCPA for all costs it incurs for undertaking the foregoing activities.
G. Upon full execution of this Agreement, NCPA will enter into the Purchase
Agreements on behalf of the Participants, and such Purchase Agreements shall be deemed
a NCPA Project by the Commission.
2
THIRD PHASE AGREEMENT FOR GEYSERS POWER COMPANY PROJECT
H. Each of the Parties intends to observe the provisions of this Agreement in
good faith and shall cooperate with all other Parties in order to achieve the full benefits of
joint action.
I. The Parties desire to equitably allocate costs of NCPA's provision of services
under this Agreement among the Participants.
The Participants further desire, insofar as possible, to insulate other
Members who are not Participants, from risks inherent in the services and transactions
undertaken on behalf of the Participants pursuant to this Agreement.
NOW, THEREFORE, the Parties agree as follows:
Section 1. Definitions.
1.1 Definitions. Whenever used in this Agreement (including the Recitals
hereto), the following terms shall have the following respective meanings, provided,
capitalized terms used in this Agreement (including the Recitals hereto) that are not
defined in Section 1 of this Agreement shall have the meaning indicated in Section 1 of the
Power Management and Administrative Services Agreement, dated October 1, 2014:
1.1.1 "Administrative Services Costs" means that portion of the NCPA
administrative, general and occupancy costs and expenses, including those costs and
expenses associated with the operations, direction and supervision of the general
affairs and activities of NCPA, general management, treasury operations, accounting,
budgeting, payroll, human resources, information technology, facilities management,
3
THIRD PHASE AGREEMENT FOR GEYSERS POWER COMPANY PROJECT
salaries and wages (including retirement benefits) of employees, facility operation and
maintenance costs, taxes and payments in lieu of taxes (if any), insurance premiums,
fees for legal, engineering, financial and other services, power management services,
general settlement and billing services and general risk management costs, that are
charged directly or apportioned to the provision of services under this Agreement.
Administrative Services Costs as separately defined herein and used in the context of
this Agreement is different and distinct from the term Administrative Services Costs as
defined in Section 1 of the Power Management and Administrative Services
Agreement.
1.1.2 "Agreement" means this Third Phase Agreement, including all
Exhibits attached hereto.
1.1.3 "All Resources Bill" has the meaning set forth in the Power
Management and Administrative Services Agreement.
1.1.4 "CAISO" means the California Independent System Operator
Corporation, or its functional successor.
1.1.5 "CAISO Tariff" means the duly authorized tariff, rules, protocols
and other requirements of the CAISO, as amended from time to time.
1.1.6 "Commission" has the meaning set forth in the Power
Management and Administrative Services Agreement.
4
THIRD PHASE AGREEMENT FOR GEYSERS POWER COMPANY PROJECT
1.1.7 "Constitutive Documents" means, with respect to NCPA, the Joint
Powers Agreement and any resolutions or bylaws adopted thereunder with respect to
the governance of NCPA, and with respect to each Participant, the California
Government Code and other statutory provisions applicable to such Participant, any
applicable agreements, charters, contracts, or other documents concerning the
formation, operation or decision making of such Participant, including, if applicable, its
city charter, and any codes, ordinances, bylaws, and resolutions adopted by such
Participant's governing body.
1.1.8 "Defaulting Participant" has the meaning set forth in Section 7.2.
1.1.9 "Electric System" has the meaning set forth in the Power
Management and Administrative Services Agreement.
1.1.10 "Event of Default" has the meaning set forth in Section 7.2.
1.1.11 "General Operating Reserve" means the NCPA General Operating
Reserve created through resolution of the Commission, as the same may be amended
from time to time.
Agreement.
1.1.12 "NCPA" has the meaning set forth in the Recitals hereto.
1.1.13 "Participant" has the meaning set forth in the Recitals of this
1.1.14 "Power Management and Administrative Services Agreement"
means the NCPA Power Management and Administrative Services Agreement, dated
5
THIRD PHASE AGREEMENT FOR GEYSERS POWER COMPANY PROJECT
as of October 1, 2014 between NCPA and the Members who are signatories to that
agreement by which NCPA provides Power Management and Administrative Services.
Product.
1.1.15 "Products" means collectively the RA Product and the Renewable
1.1.16 "Purchase Agreements" have the meaning set forth in Recital D of
this Agreement. Upon final execution of the Purchase Agreements, the Purchase
Agreements shall be deemed a NCPA Project in accordance with the Amended and
Restated Facilities Agreement, and therefore be referred to herein as the "Project".
1.1.17 "Project Costs" means all costs charged to and paid by NCPA
pursuant to the Purchase Agreements.
1.1.18 "Project Participation Percentage" has the meaning set forth in the
Power Management and Administrative Services Agreement, and are set forth in
Exhibit A of this Agreement.
1.1.19 "Party" or "Parties" has the meaning set forth in the preamble
hereto; provided that "Third Parties" are entities that are not Party to this Agreement.
1.1.20 "RA Product" means the resource adequacy capacity products
described in Article 3 of the RA Agreement.
1.1.21 "Renewable Product" means renewable energy product and
associated attributes which are defined as "Product" in the RPS Agreement.
6
THIRD PHASE AGREEMENT FOR GEYSERS POWER COMPANY PROJECT
1.1.22 "Revenue" means, with respect to each Participant, all income,
rents, rates, fees, charges, and other moneys derived by the Participant from the
ownership or operation of its Electric System, including, without limiting the generality
of the foregoing: (a) all income, rents, rates, fees, charges or other moneys derived from
the sale, furnishing and supplying of electric capacity and energy and other services,
facilities, and commodities sold, furnished, or supplied through the facilities of its
Electric System; (b) the earnings on and income derived from the investment of such
income, rents, rates, fees, charges or other moneys to the extent that the use of such
earnings and income is limited by or pursuant to law to its Electric System; (c) the
proceeds derived by the Participant directly or indirectly from the sale, lease or other
disposition of all or a part of the Electric System; and (d) the proceeds derived by
Participant directly or indirectly from the consignment and sale of freely allocated
greenhouse gas compliance instruments into periodic auctions administered by the
State of California under the California Cap -and -Trade Program, provided that such
proceeds are a permitted use of auction proceeds, but the term Revenues shall not
include (i) customers' deposits or any other deposits subject to refund until such
deposits have become the property of the Participant or (ii) contributions from
customers for the payment of costs of construction of facilities to serve them.
1.1.23 "Scheduling Protocols" means the applicable provisions of the
Amended and Restated Scheduling Coordination Program Agreement, and any other
7
THIRD PHASE AGREEMENT FOR GEYSERS POWER COMPANY PROJECT
contractual or other arrangements between NCPA and the Participants concerning the
scheduling, delivery and metering of the Purchase Agreements.
1.1.24 "Security Deposit" means the account established by NCPA and
funded by the Participants in accordance with Section 5, the funds of which are
available for use by NCPA in accordance with the terms and conditions hereof.
1.1.25 "Seller" means Geysers Power Company, LLC, as set forth in
Recital D of this Agreement, or as otherwise set forth in the Purchase Agreements.
1.1.26 "Term" has the meaning set forth in Section 10.
1.1.27 "Third Party" means an entity (including a Member) that is not
Party to this Agreement.
1.2 Rules of Interpretation. As used in this Agreement (including the Recitals
hereto), unless in any such case the context requires otherwise: The terms "herein,"
"hereto," "herewith" and "hereof" are references to this Agreement taken as a whole and
not to any particular provision; the term "include," "includes" or "including" shall mean
"including, for example and without limitation;" and references to a "Section,"
"subsection," "clause," "Appendix", "Schedule", or "Exhibit" shall mean a Section,
subsection, clause, Appendix, Schedule or Exhibit of this Agreement, as the case may be.
All references to a given agreement, instrument, tariff or other document, or law,
regulation or ordinance shall be a reference to that agreement, instrument, tariff or other
document, or law, regulation or ordinance as such now exists and as may be amended
8
THIRD PHASE AGREEMENT FOR GEYSERS POWER COMPANY PROJECT
from time to time, or its successor. A reference to a "person" includes any individual,
partnership, firm, company, corporation, joint venture, trust, association, organization or
other entity, in each case whether or not having a separate legal personality and includes
its successors and permitted assigns. A reference to a "day" shall mean a Calendar Day
unless otherwise specified. The singular shall include the plural and the masculine shall
include the feminine, and vice versa.
Section 2. Purpose. The purpose of this Agreement is to: (i) set forth the terms and
conditions under which NCPA shall enter into the Purchase Agreements on behalf of the
Participants, (ii) authorize NCPA, acting on behalf of the Participants, to engage in all
activities related to that basic purpose, and (iii) specify the rights and obligations of NCPA
and the Participants with respect to the Purchase Agreements.
Section 3. Sale and Purchase of Products. By executing this Agreement, each
Participant acknowledges and agrees to be bound by the terms and conditions of the
Agreement, and that the Agreement is written as a "take -or -pay" agreement. Any
Products delivered to NCPA under the Purchase Agreements shall be delivered to each
Participant in proportion to such Participant's Project Participation Percentage as set forth
in Exhibit A, and each Participant shall accept and pay for its respective percentage of such
Products. To the extent a Participant is unable to accept such deliveries in full, NCPA
shall dispose of such surplus in its sole discretion, in such a manner to attempt to
maximize Participant value and that Participant shall reimburse to NCPA any costs
9
THIRD PHASE AGREEMENT FOR GEYSERS POWER COMPANY PROJECT
incurred by NCPA in doing so. Notwithstanding the above, NCPA may allocate Products
procured through the Purchase Agreements among the Participants in such percentages as
NCPA may, in its reasonable discretion, determine are necessary, desirable, or
appropriate, in order to accommodate Participant transfer rights pursuant to Section 9.
3.1 Scheduling. Products delivered from Seller shall be scheduled for and to the
Participants in accordance with Scheduling Protocols, and the terms and conditions of the
Purchase Agreements.
Section 4. Billing and Payments
4.1 Participant Payment Obligations. Each Participant agrees to pay to NCPA
each month its respective portion of the Project Costs, Administrative Services Costs,
scheduling coordination costs, and all other costs for services provided in accordance with
this Agreement and the Amended and Restated Facilities Agreement. In addition to the
aforementioned monthly payment obligations, each Participant is obligated to fund: (i)
any and all required Security Deposits calculated in accordance with Section 5, and (ii) any
working capital requirements for the Project maintained by NCPA as determined,
collected and set forth in the Annual Budget.
4.2 Invoices. NCPA will issue an invoice to each Participant for its share of
Project Costs, Administrative Services Costs, scheduling coordination costs, and all other
costs for services provided in accordance with this Agreement and the Amended and
Restated Facilities Agreement. Such invoice may be either the All Resources Bill or
10
THIRD PHASE AGREEMENT FOR GEYSERS POWER COMPANY PROJECT
separate special invoice, as determined by NCPA. At NCPA's discretion, invoices may be
issued to Participants using electronic media or physical distribution.
4.3 Payment of Invoices. All invoices delivered by NCPA (including the All
Resources Bill) are due and payable thirty (30) Calendar Days after the date thereof;
provided, however, that any amount due on a day other than a Business Day may be paid
on the following Business Day.
4.4 Late Payments. Any amount due and not paid by a Participant in accordance
with Section 4.3 shall be considered late and bear interest computed on a daily basis until
paid at the lesser of (i) the per annum prime rate (or reference rate) of the Bank of America
NT&SA then in effect, plus two percent (2%) or (ii) the maximum rate permitted by law.
4.5 Billing Disputes. A Participant may dispute the accuracy of any invoice
issued by NCPA under this Agreement by submitting a written dispute to NCPA, within
thirty (30) Calendar Days after the date of such invoice; nonetheless the Participant shall
pay the full amount billed when due. If a Participant does not timely question or dispute
the accuracy of any invoice in writing, then the invoice shall be deemed to be correct.
Upon review of a submitted dispute, if an invoice is determined by NCPA to be incorrect,
then NCPA shall issue a corrected invoice and refund any amounts that may be due to the
Participant. If NCPA and the Participant fail to agree on the accuracy of an invoice within
thirty (30) Calendar Days after the Participant has disputed it, then the General Manager
shall promptly submit the dispute to the Commission for resolution. If the Commission
11
THIRD PHASE AGREEMENT FOR GEYSERS POWER COMPANY PROJECT
and the Participant fail to agree on the accuracy of a disputed invoice within sixty (60)
Calendar Days after its submission to the Commission, then the dispute may then be
resolved under the mediation and arbitration procedures set forth in Section 12 of this
Agreement; provided, however, that prior to resorting to either mediation or arbitration
proceedings, the full amount of the disputed invoice must be paid by the Participant.
4.6 Billing/Settlement Data and Examination of Books and Records.
4.6.1 Settlement Data. NCPA shall make billing and settlement data
available to the Participants in the All Resources Bill, or other invoice, or upon request.
NCPA may also, at its sole discretion, make billing and settlement support information
available to Participants using electronic media (e.g. electronic data portal).
Procedures and formats for the provision of such electronic data submission may be
established by the Commission from time to time. Without limiting the generality of
the foregoing, NCPA may, in its reasonable discretion, require the Participants to
execute a non -disclosure agreement prior to providing access to the NCPA electronic
data portal.
4.6.2 Examination of Books and Records. Any Participant to this
Agreement shall have the right to examine the books and records created and
maintained by NCPA pursuant to this Agreement at any reasonable, mutually agreed
upon time.
12
THIRD PHASE AGREEMENT FOR GEYSERS POWER COMPANY PROJECT
Section 5. Security Deposit Administration
5.1 Security Deposit Requirements. Each Participant agrees that any funds
deposited at NCPA to satisfy Participant's Security Deposit requirements pursuant to this
Agreement shall be irrevocably committed and held by NCPA in the General Operating
Reserve, and that such funds may be used by NCPA in accordance with Section 5.1.3.
Each Participant's Security Deposit will be accounted separately from and in addition to
any other security accounts or deposits maintained pursuant to any other agreement
between NCPA and the Participant, or any other such security account or deposits
required of Members. In connection with fulfilling the Security Deposit requirements of
this Agreement, Participant may elect to use its uncommitted funds held in the General
Operating Reserve to satisfy in whole or in part its Security Deposit required under
Section 5. If Participant chooses to satisfy in whole or in part its security requirements
using its uncommitted funds held in the General Operating Reserve, then Participant is
required to execute and deliver to NCPA an Irrevocable Letter of Direction, directing
NCPA to utilize Participant's uncommitted General Operating Reserve funds for such
purposes, and the designated funds will thereafter be irrevocably committed and held by
NCPA to satisfy the requirements of this Agreement.
5.1.1 Initial Amounts. No later than November 1, 2024, each Participant
shall ensure that sufficient Security Deposit funds have been deposited with and are
held by NCPA in an amount equal to the highest three (3) months of estimated Project
13
THIRD PHASE AGREEMENT FOR GEYSERS POWER COMPANY PROJECT
Costs for the initial term from January 2025 through December 2026, as estimated by
NCPA.1 No later than November 1, 2026, each Participant shall adjust the Security
Deposit to an amount equal to the highest three (3) months of estimated Project Costs
for the period January 2027 through December 2036, as estimated by NCPA.2 Such
Security Deposit requirement may be satisfied by Participant in whole or part either in
cash, through irrevocable commitment of its uncommitted funds held in the General
Operating Reserve in accordance with Section 5.1, or through a clean, irrevocable letter
of credit satisfactory to NCPA's General Manager.
5.1.2 Subsequent Deposits. Periodically, and at least quarterly, NCPA
shall review and revise its estimate of Project Costs for which Participant shall be
obligated to pay under this Agreement. Following such review, NCPA shall determine
whether each Participant has a sufficient Security Deposit balance at NCPA. To the
extent that any Participant's Security Deposit balance is greater than one hundred and
ten percent (110%) of the amount required herein, NCPA shall credit such amount as
soon as practicable to the Participant's next following All Resources Bill, or by separate
special invoice. To the extent that any Participant's Security Deposit balance is less
than ninety percent (90%) of the amount required herein, NCPA shall add such amount
1 The Security Deposit fund requirement for the initial term is structured to avoid a Downgrade Event to
Buyer as such terms are defined in RPS Agreement.
2 The Security Deposit fund requirement is increased in November of 2026 to reflect the increased contract
quantity beginning on January 1, 2027, and is structured to avoid a Downgrade Event to Buyer as such terms
are defined in RPS Agreement.
14
THIRD PHASE AGREEMENT FOR GEYSERS POWER COMPANY PROJECT
as soon as practicable to such Participant's next All Resources Bill, or as necessary, to a
special invoice to be paid by Participant upon receipt. Credits or additions shall not be
made to Participants who satisfy these Security Deposit requirements in whole through
the use of a letter of credit; provided, that the amount of the letter of credit shall be
adjusted, as required from time to time, in a like manner to assure an amount not to
exceed the highest three (3) months of estimated Project Costs is available to NCPA, as
determined by NCPA.
5.1.3 Use of Security Deposit Funds. NCPA may use any and all
Security Deposit funds held by NCPA (or utilize a letter of credit provided in lieu
thereof) to pay any costs it incurs hereunder, including making payments to Seller,
without regard to any individual Participant's Security Deposit balance or
proportionate share of Project Costs, and irrespective of whether NCPA has issued an
All Resources Bill or special invoice for such costs to the Participants or whether a
Participant has made timely payments of All Resources Bills or special invoices.
Should Participant have satisfied its Security Deposit requirements in whole or part
through a letter of credit, NCPA may draw on such letter of credit to satisfy
Participant's obligations hereunder at NCPA's sole discretion. Notwithstanding the
foregoing, if any Participant fails to pay any costs incurred by NCPA pursuant to this
Agreement, NCPA shall first use that non-paying Participant's Security Deposit and
15
THIRD PHASE AGREEMENT FOR GEYSERS POWER COMPANY PROJECT
shall not use any other Participants' Security Deposit until such non-paying
Participant's Security Deposit has been exhausted.
5.1.4 Accounting. If Security Deposit funds or a letter of credit are used
by NCPA to pay any costs it incurs hereunder as described in Section 5.1.3, then NCPA
will maintain a detailed accounting of each Participant's shares of funds withdrawn,
and upon the collection of all or a part of such withdrawn funds, NCPA will credit
back to each non -defaulting Participant the funds collected in proportion to such non -
defaulting Participant's share of funds initially withdrawn.
5.1.5 Emergency Additions. In the event that funds are withdrawn
pursuant to Section 5.1.3, or if the Security Deposit held by NCPA is otherwise
insufficient to allow for NCPA to pay any invoice, demand, request for further
assurances by Seller, or claims, NCPA shall notify all Participants of the deficiency. In
conjunction with such notice, NCPA shall send a special or emergency assessment
invoice to the Participant or Participants that caused or are otherwise responsible for
the deficiency. Each Participant of such an invoice shall pay to NCPA such assessment
when and if assessed by NCPA within two (2) Business Days of the invoice date of the
assessment, or shall consent to and direct NCPA to draw on any existing letter of credit
Participant has established for such purposes. In the event that the Participant or
Participants that caused or are otherwise responsible for the deficiency cannot, does
not or will not pay to NCPA the special or emergency assessment within two (2)
16
THIRD PHASE AGREEMENT FOR GEYSERS POWER COMPANY PROJECT
Business Days after the invoice date, NCPA shall immediately submit a special or
emergency invoice to all remaining Participants, and such remaining Participants shall
pay to NCPA such assessment within two (2) Business Days after the invoice date of
the assessment, or shall consent to and direct NCPA to draw on any existing letter of
credit that Participant has established for such purposes.
5.1.6 Security Deposit Interest. NCPA shall maintain a detailed
accounting of each Participant's Security Deposits, and withdrawals of such funds,
held by NCPA. Security Deposits held by NCPA shall be invested by NCPA in
accordance with the General Operating Reserve policies and investment policies
adopted by the NCPA Commission. Interest earned on the Security Deposit funds
shall be proportionately credited to the Participants in accordance with their weighted
average balances held therein. Any Security Deposit losses caused by early
termination of investments shall be allocated among the Participants in accordance
with the General Operating Reserve provisions and guidelines approved by the
Commission, as the same may be amended from time to time; provided, however, to
the extent that either the General Operating Reserve provisions and guidelines do not
apply or the Security Deposit is not adequate to cover the losses, then such losses shall
be allocated among the Participants in accordance with their proportionate Security
Deposit balances.
17
THIRD PHASE AGREEMENT FOR GEYSERS POWER COMPANY PROJECT
5.1.7 Return of Funds. Upon termination or a permitted withdrawal of
a Participant in accordance with this Agreement, the affected Participant may apply to
NCPA for the return of their share of Security Deposit funds ninety (90) days after the
effective date of such termination or withdrawal. However, NCPA shall, in its sole but
reasonable discretion, as determined by the NCPA General Manager, estimate the then
outstanding liabilities of the Participant, including any estimated contingent liabilities
and shall retain all such funds, if any, until all such liabilities have been fully paid or
otherwise satisfied in full. After all such liabilities have been satisfied in full, as
determined by NCPA's General Manager, any remaining balance of the Participant's
share of the Security Deposit will be refunded to the Participant within sixty (60) days
thereafter.
Section 6. Cooperation and Further Assurances. Each of the Parties agree to provide
such information, execute and deliver any instruments and documents and to take such
other actions as may be necessary or reasonably requested by any other Party which are
consistent with the provisions of this Agreement and which do not involve the assumption
of obligations other than those provided for in this Agreement, in order to give full effect
to this Agreement and to carry out the intent of this Agreement. The Parties agree to
cooperate and act in good faith in connection with obtaining any credit support required
in order to satisfy the requirements of this Agreement.
18
THIRD PHASE AGREEMENT FOR GEYSERS POWER COMPANY PROJECT
Section 7. Participant Covenants and Defaults
7.1 Each Participant covenants and agrees: (i) to make payments to NCPA, from
its Electric System Revenues, of its obligations under this Agreement as an operating
expense of its Electric System; (ii) to fix the rates and charges for services provided by its
Electric System, so that it will at all times have sufficient Revenues to meet the obligations
of this Agreement, including the payment obligations; (iii) to make all such payments due
NCPA under this Agreement whether or not there is an interruption in, interference with,
or reduction or suspension of services provided under this Agreement, such payments not
being subject to any reduction, whether by offset or otherwise, and regardless of whether
any reasonable dispute exists; and (iv) to operate its Electric System, and the business in
connection therewith, in accordance with Good Utility Practices.
7.2 Events of Default. An Event of Default under this Agreement shall exist
upon the occurrence of any one or more of the following by a Participant (the "Defaulting
Participant"):
due;
(i) the failure of any Participant to make any payment in full to NCPA when
(ii) the failure of a Participant to perform any covenant or obligation of this
Agreement where such failure is not cured within thirty (30) Calendar Days following
receipt of a notice from NCPA demanding cure; provided, that this subsection shall not
apply to any failure to make payments specified by subsection 7.2 (i));
19
THIRD PHASE AGREEMENT FOR GEYSERS POWER COMPANY PROJECT
(iii) if any representation or warranty of a Participant material to the services
provided hereunder shall prove to have been incorrect in any material respect when made
and the Participant does not cure the facts underlying such incorrect representation or
warranty so that the representation or warranty becomes true and correct within thirty
(30) Calendar Days after the date of receipt of notice from NCPA demanding cure; or
(iv) if a Participant is in default or in breach of any of its covenants or
obligations under any other agreement with NCPA and such default or breach is not cured
within the time periods specified in such agreement.
7.3 Uncontrollable Forces. A Party shall not be considered to be in default in
respect of any obligation hereunder if prevented from fulfilling such obligation by reason
of Uncontrollable Forces; provided, that in order to be relieved of an Event of Default due
to Uncontrollable Forces, a Party affected by an Uncontrollable Force shall:
(i) first provide oral notice to the General Manager using telephone
communication within two (2) Business Days after the onset of the Uncontrollable Force,
and provide subsequent written notice to the General Manager and all other Parties within
ten (10) Business Days after the onset of the Uncontrollable Force, describing its nature
and extent, the obligations which the Party is unable to fulfill, the anticipated duration of
the Uncontrollable Force, and the actions which the Party will undertake so as to remove
such disability and be able to fulfill its obligations hereunder; and
20
THIRD PHASE AGREEMENT FOR GEYSERS POWER COMPANY PROJECT
(ii) use due diligence to place itself in a position to fulfill its obligations
hereunder and if unable to fulfill any obligation by reason of an Uncontrollable Force such
Party shall exercise due diligence to remove such disability with reasonable dispatch;
provided, that nothing in this subsection shall require a Party to settle or compromise a
labor dispute.
7.4 Cure of an Event of Default. An Event of Default shall be deemed cured only
if such default shall be remedied or cured within the time periods specified in Section 7.2
above, as may be applicable, provided, however, upon request of the Defaulting
Participant the Commission may waive the default at its sole discretion, where such
waiver shall not be unreasonably withheld.
7.5 Remedies in the Event of Uncured Default. Upon the occurrence of an Event
of Default which is not cured within the time limits specified in Section 7.2, without
limiting other rights or remedies available under this Agreement, at law or in equity, and
without constituting or resulting in a waiver, release or estoppel of any right, action or
cause of action NCPA may have against the Defaulting Participant, NCPA may take any
or all of the following actions:
(i) suspend the provision of services under this Agreement to such
Defaulting Participant; or
(ii) demand that the Defaulting Participant provide further assurances to
guarantee the correction of the default, including the collection of a surcharge or increase
21
THIRD PHASE AGREEMENT FOR GEYSERS POWER COMPANY PROJECT
in electric rates, or such other actions as may be necessary to produce necessary Revenues
to correct the default.
7.6 Effect of Suspension.
7.6.1 Generally. The suspension of this Agreement will not terminate,
waive, or otherwise discharge any ongoing or undischarged liabilities, credits or
obligations arising from this Agreement until such liabilities, credits or obligations are
satisfied in full.
7.6.2 Suspension. If performance of all or any portion of this Agreement
is suspended by NCPA with respect to a Participant in accordance with subsection
7.5(i), then such Participant shall pay any and all costs incurred by NCPA as a result of
such suspension including reasonable attorney's fees, the fees and expenses of other
experts, including auditors and accountants, or other reasonable and necessary costs
associated with such suspension and any portion of the Project Costs, scheduling and
dispatch costs, and Administrative Services Costs that were not recovered from such
Participant as a result of such suspension.
Section 8. Administration of Agreement
8.1 Commission. The Commission is responsible for the administration of this
Agreement. Each Participant shall be represented by its Commissioner or their designated
alternate Commissioner ("Alternate") pursuant to the Joint Powers Agreement. Each
22
THIRD PHASE AGREEMENT FOR GEYSERS POWER COMPANY PROJECT
Commissioner shall have authority to act for the Participant represented with respect to
matters pertaining to this Agreement.
8.2 Forum. Whenever any action anticipated by this Agreement is required to be
jointly taken by the Participants, such action shall be taken at regular or special meetings
of the NCPA Commission.
8.3 Quorum. For purposes of acting upon matters that relate to administration
of this Agreement, a quorum of the Participants shall consist of those Commissioners, or
their designated Alternate, representing a numerical majority of the Participants.
8.4 Voting. Each Participant shall have the right to cast one vote with respect to
matters pertaining to this Agreement. A unanimous vote of all Participants shall be
required for action regarding: (i) any transfer of rights to a Third Party as described in
Section 9 of this Agreement; and (ii) for matters related to any of the following actions as
provided for in the Purchase Agreements: (a) exercising any early termination provisions
as set forth in the Purchase Agreements, and (b) exercising any assignment rights as set
forth in the Purchase Agreements. For all other matters pertaining to this Agreement, a
majority vote of the Participants shall be required for action.
Section 9. Transfer of Rights by Participants
9.1 A Participant has the right to make transfers, sales, assignments and
exchanges (collectively "transfers(s)") of any portion of its Project Participation Percentage
and rights thereto, subject to the approval provisions in Section 8.4 of this Agreement,
23
THIRD PHASE AGREEMENT FOR GEYSERS POWER COMPANY PROJECT
provided that the transferee satisfies all applicable criterion in the Purchase Agreements.
If a Participant desires to transfer a portion or its entire share of the Project for a specific
time interval, or permanently, then NCPA will, if requested by such Participant, use its
best efforts to transfer that portion of the Participant's share of the Project.
9.2 Unless otherwise set forth in this Agreement, before a Participant may
transfer an excess Project share pursuant to Section 9.1 to any person or entity other than a
Participant, it shall give all other Participants the right to purchase the share on the same
terms and conditions. Before a Participant may transfer an excess Project share pursuant
to section 9.1 to any person or entity other than a Member, it shall give all Members the
right to purchase the share on the same terms and conditions. Such right shall be
exercised within thirty (30) days of receipt of notice of said right.
No transfer shall relieve a Participant of any of its obligations under this
Agreement except to the extent that NCPA receives payment of these obligations from a
transferee.
9.3 The provisions of this Section 9 do not apply to the Exhibit A, unless
expressly set forth therein.
Section 10. Term and Termination. This Agreement shall become effective when it has
been duly executed by all Participants, and delivered to and executed by NCPA (the
"Effective Date"). NCPA shall notify all Participants in writing of the Effective Date. The
Term of this Agreement shall be coterminous with the Purchase Agreements, and shall
24
THIRD PHASE AGREEMENT FOR GEYSERS POWER COMPANY PROJECT
commence on the Effective Date, and shall continue through the term of the Purchase
Agreements.
Section 11. Withdrawal of Participants. No Participant may withdraw from this
Agreement except as otherwise provided for herein.
Section 12. Settlement of Disputes and Arbitration. The Parties agree to make best
efforts to settle all disputes among themselves connected with this Agreement as a matter
of normal business under this Agreement. The procedures set forth in Section 10 of the
Power Management and Administrative Services Agreement shall apply to all disputes
that cannot be settled by the Participants themselves; provided, that the provisions of
Section 4.5 shall first apply to all disputes involving invoices prepared by NCPA.
Section 13. Miscellaneous
13.1 Confidentiality. The Parties will keep confidential all confidential or trade
secret information made available to them in connection with this Agreement, to the extent
possible, consistent with applicable laws, including the California Public Records Act.
Confidential or trade secret information shall be marked or expressly identified as such.
If a Party ("Receiving Party") receives a request from a Third Party for access to, or
inspection, disclosure or copying of, any other Party's (the "Supplying Party") confidential
data or information, which the Receiving Party has possession of ("Disclosure Request"),
then the Receiving Party shall provide notice and a copy of the Disclosure Request to the
Supplying Party within three (3) Business Days after receipt of the Disclosure Request.
25
THIRD PHASE AGREEMENT FOR GEYSERS POWER COMPANY PROJECT
Within three (3) Business Days after receipt of such notice, the Supplying Party shall
provide notice to the Receiving Party either:
(i) that the Supplying Party believes there are reasonable legal grounds for
denying or objecting to the Disclosure Request, and the Supplying Party requests the
Receiving Party to deny or object to the Disclosure Request with respect to identified
confidential information. In such case, the Receiving Party shall deny the Disclosure
Request and the Supplying Party shall defend the denial of the Disclosure Request at its
sole cost, and it shall indemnify the Receiving Party for all costs associated with denying
or objecting to the Disclosure Request. Such indemnification by the Supplying Party of the
Receiving Party shall include all of the Receiving Party's costs reasonably incurred with
respect to denial of or objection to the Disclosure Request, including but not limited to
costs, penalties, and the Receiving Party's attorney's fees; or
(ii) that the Receiving Party may grant the Disclosure Request without any
liability by the Receiving Party to the Supplying Party.
13.2 Indemnification and Hold Harmless. Subject to the provisions of Section
13.4, each Participant agrees to indemnify, defend and hold harmless NCPA and its
Members, including their respective governing boards, officials, officers, agents, and
employees, from and against any and all claims, suits, losses, costs, damages, expenses
and liability of any kind or nature, including reasonable attorneys' fees and the costs of
litigation, including experts, to the extent caused by any acts, omissions, breach of
26
THIRD PHASE AGREEMENT FOR GEYSERS POWER COMPANY PROJECT
contract, negligence (active or passive), gross negligence, recklessness, or willful
misconduct of that Participant, its governing officials, officers, employees, subcontractors
or agents, to the maximum extent permitted by law.
13.3 Several Liabilities. No Participant shall, in the first instance, be liable under
this Agreement for the obligations of any other Participant or for the obligations of NCPA
incurred on behalf of other Participants. Each Participant shall be solely responsible and
liable for performance of its obligations under this Agreement, except as otherwise
provided for herein. The obligation of each Participant under this Agreement is, in the
first instance, a several obligation and not a joint obligation with those of the other
Participants.
Notwithstanding the foregoing, the Participants acknowledge that any debts
or obligations incurred by NCPA under this Agreement on behalf of any of them shall be
borne solely by such Participants in proportion to their respective Project Participation
Percentages, and not by non -Participant Members of NCPA, pursuant to Article IV,
Section 3(b) of the Joint Powers Agreement.
In the event that a Participant should fail to pay its share of the debts or
obligations incurred by NCPA as required by this Agreement, the remaining Participants
shall, in proportion to their Project Participation Percentages, pay such unpaid amounts
and shall be reimbursed by the Participant failing to make such payments.
27
THIRD PHASE AGREEMENT FOR GEYSERS POWER COMPANY PROJECT
13.4 No Consequential Damages. FOR ANY BREACH OF ANY PROVISION OF
THIS AGREEMENT FOR WHICH AN EXPRESS REMEDY OR MEASURE OF DAMAGES
IS PROVIDED IN THIS AGREEMENT, THE LIABILITY OF THE DEFAULTING PARTY
SHALL BE LIMITED AS SET FORTH IN SUCH PROVISION, AND ALL OTHER
DAMAGES OR REMEDIES ARE HEREBY WAIVED. IF NO REMEDY OR MEASURE OF
DAMAGE IS EXPRESSLY PROVIDED, THE LIABILITY OF THE DEFAULTING PARTY
SHALL BE LIMITED TO ACTUAL DAMAGES ONLY AND ALL OTHER DAMAGES
AND REMEDIES ARE HEREBY WAIVED. IN NO EVENT SHALL NCPA OR ANY
PARTICIPANT OR THEIR RESPECTIVE SUCCESSORS, ASSIGNS, REPRESENTATIVES,
DIRECTORS, OFFICERS, AGENTS, OR EMPLOYEES BE LIABLE FOR ANY LOST
PROFITS, CONSEQUENTIAL, SPECIAL, EXEMPLARY, INDIRECT, PUNITIVE, OR
INCIDENTAL LOSSES OR DAMAGES, INCLUDING LOSS OF USE, LOSS OF
GOODWILL, LOST REVENUES, LOSS OF PROFIT OR LOSS OF CONTRACTS EVEN IF
SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES, AND
NCPA AND EACH PARTICIPANT EACH HEREBY WAIVES SUCH CLAIMS AND
RELEASES EACH OTHER AND EACH OF SUCH PERSONS FROM ANY SUCH
LIABILITY.
The Parties acknowledge that California Civil Code section 1542 provides that: "A general
release does not extend to claims which the creditor does not know or suspect to exist in
his or her favor at the time of executing the release, which if known by him or her must
28
THIRD PHASE AGREEMENT FOR GEYSERS POWER COMPANY PROJECT
have materially affected his or her settlement with the debtor." The Parties waive the
provisions of section 1542, or other similar provisions of law, and intend that the waiver
and release provided by this Section of this Agreement shall be fully enforceable despite
its reference to future or unknown claims.
13.5 Waiver. No waiver of the performance by a Party of any obligation under
this Agreement with respect to any default or any other matter arising in connection with
this Agreement shall be effective unless given by the Commission or the governing body
of a Participant, as applicable. Any such waiver by the Commission in any particular
instance shall not be deemed a waiver with respect to any subsequent performance,
default or matter.
13.6 Amendments. Except where this Agreement specifically provides otherwise,
this Agreement may be amended only by written instrument executed by the Parties with
the same formality as this Agreement.
13.7 Assignment of Agreement.
13.7.1 Binding Upon Successors. This Agreement shall inure to the
benefit of and shall be binding upon the respective successors and assignees of the
Parties to this Agreement.
13.7.2 No Assignment. Neither this Agreement, nor any interest herein,
shall be transferred or assigned by a Party hereto except with the consent in writing of
the other Parties hereto, which consent shall not be unreasonably withheld.
29
THIRD PHASE AGREEMENT FOR GEYSERS POWER COMPANY PROJECT
13.8 Severability. In the event that any of the terms, covenants or conditions of
this Agreement or the application of any such term, covenant or condition, shall be held
invalid as to any person or circumstance by any court having jurisdiction, all other terms,
covenants or conditions of this Agreement and their application shall not be affected
thereby, but shall remain in force and effect unless the court holds that such provisions are
not severable from all other provisions of this Agreement.
13.9 Governing Law. This Agreement shall be interpreted, governed by, and
construed under the laws of the State of California.
13.10 Headings. All indices, titles, subject headings, section titles and similar items
are provided for the purpose of convenience and are not intended to be inclusive,
definitive, or affect the meaning of the contents of this Agreement or the scope thereof.
13.11 Notices. Any notice, demand or request required or authorized by this
Agreement to be given to any Party shall be in writing, and shall either be personally
delivered to a Participant's Commissioner or Alternate, and to the General Manager, or
shall be transmitted to the Participant and the General Manager at the addresses shown on
the signature pages hereof. The designation of such addresses may be changed at any
time by written notice given to the General Manager who shall thereupon give written
notice of such change to each Participant. All such notices shall be deemed delivered
when personally delivered, two (2) Business Days after deposit in the United States mail
30
THIRD PHASE AGREEMENT FOR GEYSERS POWER COMPANY PROJECT
first class postage prepaid, or on the first Business Day following delivery through
electronic communication.
13.12 Warranty of Authority. Each Party represents and warrants that it has been
duly authorized by all requisite approval and action to execute and deliver this Agreement
and that this Agreement is a binding, legal, and valid agreement enforceable in accordance
with its terms. Upon execution of this Agreement, each Participant shall deliver to NCPA
a resolution of the governing body of such Participant evidencing approval of and
authority to enter into this Agreement.
13.13 Counterparts. This Agreement may be executed in any number of
counterparts, and each executed counterpart shall have the same force and effect as an
original instrument and as if all the signatories to all of the counterparts had signed the
same instrument. Any signature page of this Agreement may be detached from any
counterpart of this Agreement without impairing the legal effect of any signatures thereon,
and may be attached to another counterpart of this Agreement identical in form hereto but
having attached to it one or more signature pages.
13.14 Venue. In the event that a Party brings any action under this Agreement, the
Parties agree that trial of such action shall be vested exclusively in the state courts of
California in the County of Placer or in the United States District Court for the Eastern
District of California.
31
THIRD PHASE AGREEMENT FOR GEYSERS POWER COMPANY PROJECT
13.15 Attorneys' Fees. If a Party to this Agreement brings any action, including an
action for declaratory relief, to enforce or interpret the provisions of this Agreement, then
each Party shall bear its own fees and costs, including attorneys' fees, associated with the
action.
13.16 Counsel Representation. Pursuant to the provisions of California Civil Code
Section 1717 (a), each of the Parties were represented by counsel in the negotiation and
execution of this Agreement and no one Party is the author of this Agreement or any of its
subparts. Those terms of this Agreement which dictate the responsibility for bearing any
attorney's fees incurred in arbitration, litigation or settlement in a manner inconsistent
with the provisions of Section 13.2 were intentionally so drafted by the Parties, and any
ambiguities in this Agreement shall not be interpreted for or against a Party by reason of
that Party being the author of the provision.
13.17 No Third Party Beneficiaries. Nothing contained in this Agreement is
intended by the Parties, nor shall any provision of this Agreement be deemed or construed
by the Parties, by any third person or any Third Parties, to be for the benefit of any Third
Party, nor shall any Third Party have any right to enforce any provision of this Agreement
or be entitled to damages for any breach by the Parties of any of the provisions of this
Agreement.
32
THIRD PHASE AGREEMENT FOR GEYSERS POWER COMPANY PROJECT
IN WITNESS WHEREOF, NCPA and each Participant have, by the signature of its
duly authorized representative shown below, executed and delivered a counterpart of this
Agreement.
NORTHERN CALIFORNIA
POWER AGENCY
651 Commerce Drive
Rose ille, CA 95678
By: Rand . Howard
Title: General Manager
Date: 121Z3lZZ
Approved as to form:
C2t
/- /' - fXAr.
�By: lane E. Luckhardt
Its: General Counsel
Date: al _
Attestation (if applicable):
By:_-�s
Its: of cry MI sr3
Date: 12- - 7-3 - 2 -o? -Z
CITY OF SANTA CLARA
1500 Warburton Avenue
Santa Clara, CA 95050
��;W&
U1..0 ' r—r-A�a„"I-S„
By:
Manuel Pineda
Title: Assistant City Manager
na+c,. Dec 22, 2022
Approved as to form:
By: Daniel Bailin
Its: City Attorney
Date: Dec22,2022
I WN W-.. MAI
PER 11111111MINIVA, AN,
33
THIRD PHASE AGREEMENT FOR GEYSERS POWER COMPANY PROJECT
CITY OF ALAMEDA
2000 Grand Street
Alameda, CA 94501
By:_
Title:
Date:
Approved as to form:
By:
Its: City Attornev
Date:
Attestation (if applicable)
By:
Its:
Date•
CITY OF BIGGS
465 C Street
Biggs, CA 95917
By:
Title:
Date:
Approved as to form:
By:
Its: City Attorney
Date:
Attestation (if applicable)
By:
Its:
Date:
34
THIRD PHASE AGREEMENT FOR GEYSERS POWER COMPANY PROJECT
CITY OF GRIDLEY
685 Kentucky Street
Gridley, CA 95948
CITY OF LODI
221 W. Pine Street
Lodi, CA 95240
By:
By:_
Title:
Date:
Title:
Date:
Approved as to form:
By:
Its: City Attorney
Date:
Attestation (if applicable)
By:
Its:
Date•
Approved as to form:
By:
Its: City Attorney
Date:
Attestation (if applicable)
By:
Its:
Date:
35
THIRD PHASE AGREEMENT FOR GEYSERS POWER COMPANY PROJECT
CITY OF LOMPOC
100 Civic Center Plaza
Lompoc, CA 93436
By:_
Title:
Date:
Approved as to form:
CITY OF PALO ALTO
160 Palo Alto Avenue
Palo Alto, CA 94301
By:
Title:
Date:
Approved as to form:
By: By:
Its: City Attorney Its: City Attorney
Date:
Attestation (if applicable)
By:
Its:
Date•
Date:
Attestation (if applicable)
By:
Its:
Date:
36
THIRD PHASE AGREEMENT FOR GEYSERS POWER COMPANY PROJECT
CITY OF OAKLAND, acting
by and through its
Board of Port Commissioners
530 Water Street
Oakland, CA 94607
By:_
Title:
Date:
Approved as to form:
Its: City Attorney
Date:
Attestation (if applicable)
By:
Its:
Date•
37
THIRD PHASE AGREEMENT FOR GEYSERS POWER COMPANY PROJECT
EXHIBIT A
PROJECT PARTICIPATION PERCENTAGES
On the Effective Date of the Agreement the initial Participant ("Initial Participant") who is
signatory to this Agreement, and its respective initial Project Participation Percentage
share of the Project is set forth in Table 1 of this Exhibit A ("Initial Project Participation
Percentage"). The process set forth below is not subject to the requirements of Section 9 of
this Agreement, except as set forth below.
Table 1
Initial Project Participation Percentages
Project Project
Project Participation Participation
Participation MW MW
Member Percentages (2025 - 2026) (2027 - 2037)
City of Santa Clary '00.0% 50.00 100.00
Total: 100.0% 50.00 1DD.DD
Thereafter, a Member who is not a Participant may exercise a right to accept a transfer of a
portion of the Initial Project Participation Percentage of the Initial Participant in an amount
no greater than the amount set forth in Table 2 of this Exhibit A, no later than April 30,
2023 (the "Transfer Completion Deadline"), unless the Initial Participant otherwise agrees
in writing to extend the Transfer Completion Deadline. The right to transfer described in
this Exhibit A shall be exercised in writing (1) addressed to NCPA and the Initial
Participant, and (2) by a Member's execution of this Agreement by the Transfer
Completion Deadline. For purposes of this Exhibit A only, that Member who becomes a
Participant shall be referred to as a "Table 2 Participant." Notwithstanding the foregoing,
38
THIRD PHASE AGREEMENT FOR GEYSERS POWER COMPANY PROJECT
the Transfer Completion Deadline applies only to the intended assumption of the Project
Participation Percentage described in Table 2 of this Exhibit A, and shall not limit or
reduce a Participant's rights set forth in Section 9 of this Agreement. Upon written notice
and execution of this Agreement, the Table 2 Participant will assume all rights and
obligations set forth in this Agreement for the portion of the Project Participation
Percentage share of the Project as set forth in Table 2 of this Exhibit A. If any Members
exercise their right to accept a transfer of a share of the Project Participation Percentage,
the Parties shall add to this Exhibit A by preparing a Table 3 to reflect the Final Project
Participation Percentage shares of the Project. NCPA shall prepare Table 3 after the
Transfer Completion Deadline to reflect the Final Project Participation Percentages of each
Participant, and such Table 3 will be added to this Exhibit A as an amendment to this
Agreement once adopted by the Commission. In the event an intended Table 2 Participant
does not become a Table 2 Participant by the Transfer Completion Deadline, the Initial
Participant shall retain the Project Participation Percentage of the intended Table 2
Participant as described in Table 2 of this Exhibit A, and such will be reflected in Table 3.
Table 2
Draft Final Project Participation Percentages
39
THIRD PHASE AGREEMENT FOR GEYSERS POWER COMPANY PROJECT
Project
Project
Project
Participation
Participation
Participation
MW
MW
Member
Percentages
(2025 - 2626)
(2027- 2037)
City of Alameda
5.0%
2.50
5.00
City of Biggs
0.4%
0.20
0.40
City of Gridley
0.6%
0.30
0.60
City of Lodi
10.0%
5.00
10.00
City of Lompoc
1.7%
0.85
1.70
City of Palo Alta
10.0%
5.00
10.00
Part of Oakland
2.3%
1.15
2.30
City of Santa Clara
70.0%
35.00
70.00
Total:
100.0%
50.00
100.00
39
THIRD PHASE AGREEMENT FOR GEYSERS POWER COMPANY PROJECT
EXHIBIT B
Purchase Agreements
Western Systems Power Pool Agreement Confirmation between Northern
California Power Agency and Geysers Power Company, LLC, to purchase electric
capacity attached to this Exhibit B.
Western Systems Power Pool Agreement Confirmation between Geysers Power
Company, LLC and Northern California Power Agency, to purchase renewable energy
attached to this Exhibit B.
40
THIRD PHASE AGREEMENT FOR GEYSERS POWER COMPANY PROJECT
WESTERN SYSTEMS POWER POOL AGREEMENT
TRANSACTION CONFIRMATION
BETWEEN
NORTHERN CALIFORNIA POWER AGENCY
AND
GEYSERS POWER COMPANY, LLC
This transaction confirmation ("Confirmation") sets forth the terms and conditions of the transaction
between Northern California Power Agency, a public joint powers entity organized under the Joint Exercise
of Powers Act (California Government Code Section 6500 et seq.) ("Buyer" or "Purchaser') and Geysers
Power Company, LLC., a Delaware limited partnership ("Seller"), each individually a "Party" and together
the "Parties", dated as of December 23,2022 (the "Confirmation Effective Date"), in which Seller agrees to
provide to Buyer the Product, as such term is defined in Article 3 of this Confirmation (the "Transaction").
This Transaction is governed by the Western Systems Power Pool ("WSPP") Agreement (Effective Version:
August 26, 2022) (the "Master Agreement'). The Master Agreement and this Confirmation are collectively
referred to herein as the "Agreement'. Capitalized terms used but not otherwise defined in this Confirmation
are defined in the Master Agreement or the Tariff (as defined herein). To the extent that this Confirmation
is inconsistent with any provision of the Master Agreement, this Confirmation shall control and shall govern
the rights and obligations of the Parties in connection with this Transaction. Except as otherwise specified,
references to an "Article" or a "Section" mean an Article or Section of this Confirmation, as applicable.
ARTICLE 1
DEFINITIONS
1.1 "Agreement' has the meaning specified in the introductory paragraph hereof.
1.2 "Alternate Capacity" is defined in Section 4.5.
1.3 "Applicable Laws" means any law, rule, regulation, order, decision, judgment, or other legal or
regulatory determination by any Governmental Body having jurisdiction over one or both Parties or
this Transaction, including without limitation, the Tariff.
1.4 "Availability Incentive Payments" is defined in the Tariff.
1.5 "Availability Standards" is defined in the Tariff.
1.6 "Buyer' is defined in the introductory paragraph hereof.
1.7 "CAISO" means the California Independent System Operator Corporation or its successor.
1.8 "Capacity Replacement Price" means (a) the price actually paid for any Replacement Capacity
purchased by Buyer pursuant to Section 4.7 hereof, plus costs reasonably incurred by Buyer in
purchasing such Replacement Capacity, or (b) absent a purchase of any Replacement Capacity,
the market price for such Designated RA Capacity not provided at the Delivery Point. The Buyer
shall determine such market prices in a commercially reasonable manner. For purposes of Section
Four of the Master Agreement, "Capacity Replacement Price" shall be deemed to be the
"Replacement Price."
1.9 "CPUC' means the California Public Utilities Commission, or any successor entity.
1.10 "CIRA Tool" means the CAISO Customer Interface for Resource Adequacy application, or its
successor platform.
1.11 "Compliance Showing" means the applicable LSE compliance with the RAR, FCR and LAR of its
applicable regulatory authority for an applicable Showing Month.
1.12 "Confirmation" is defined in the introductory paragraph hereof.
1.13 "Confirmation Effective Date" is defined in the introductory paragraph hereof.
1.14 "Contingent Firm RA Product' is defined in Section 3.4.
1.15 "Contract Price" means, for any Monthly Delivery Period, the price specified under the RA Capacity
Price Table in Section 4.9.
1.16 "Contract Quantity" means, with respect to any particular Showing Month of the Delivery Period,
the amount of Product (in MWs) set forth in the table in Appendix B which Seller has agreed to
provide to Buyer from the Unit(s) for such Showing Month (as such amount may be adjusted
pursuant to Section 4.4).
1.17 "Control Area" is defined in the Tariff.
1.18 "CAISO Controlled Grid" is defined in the Tariff.
1.19 "CPUC Decisions" means CPUC Decisions 04-01-050, 04-10-035, 05-10-042, 06-06-064, 06-07-
031, 07-06-029, 08-06-031, 09-06-028, 10-06-036, 11-06-022, 12-06-025, 13-06-024, 14-06-050,
15-06-063, 16-06-045, 17-06-027, 18-06-030, 18-06-031, 19-02-022, 19-06-026,20-06-002, 20-06-
028, D.20-06-031, D.20-12-006, D.21-06-035, and any other existing or subsequent decisions
related to resource adequacy issued from time to time by the CPUC, as amended from time to time.
1.20 "CPUC Filing Guide" means the annual document issued by the CPUC which sets forth the
guidelines, requirements and instructions for LSEs to demonstrate compliance with the CPUC's
resource adequacy program.
1.21 "Delivery Period" is defined in Section 4.1
1.22 "Delivery Point" is defined in Section 4.2.
1.23 "Designated RA Capacity" shall be equal to, with respect to any particular Showing Month of the
Delivery Period, the Contract Quantity of Product for such Showing Month including the amount of
Contract Quantity that Seller has elected to provide Alternate Capacity, minus any reductions to
Contract Quantity specified in Section 4.4 with respect to which Seller has not elected to provide
Alternate Capacity.
1.24 "Effective Flexible Capacity" or "EFC" means the FCR Attributes of a resource that can be counted
towards an LSE's FCR, as identified from time to time by the Tariff, the CPUC Decisions, LRA, or
other Governmental Body having jurisdiction. To the extent the CPUC Decisions, CAISO, LRA or
other Governmental Body having jurisdiction creates a new category or classification of FCR
Attributes during the term of this Transaction, and a Unit can count toward such new categories or
classifications of FCR Attributes while operating consistent with the operational limitations and
physical characteristics of such Unit, any and all such new categories or classifications of FCR
Attributes shall be deemed to be part of the EFC and FCR Attributes of a Unit for the purpose of this
Agreement. The above notwithstanding, to the extent the CPUC Decisions, CAISO, LRA or other
Governmental Body having jurisdiction reduces the applicable EFC of a Unit, the EFC of a Unit may
be reduced pursuant to Section 4.4 of this Confirmation.
1.25 "Emission Performance Standard" or "EPS" means the requirement set -forth in California Code
of Regulations (CCR) Title 20, Chapter 11, Article 1. Section 2900 et seq.
1.26 "FCR Attributes" means, with respect to a Unit, any and all flexible resource adequacy attributes,
consistent with the operational limitations and physical characteristics of such Unit, that can be
counted toward an LSE's FCR, as may be identified at any time during the Delivery Period that can
be counted toward an LSE's FCR, exclusive of any RAR Attributes and LAR Attributes.
1.27 "FCR Showings" means the FCR Compliance Showings (or similar or successor showings) an LSE
is required to make to the CPUC (and, to the extent authorized by the CPUC, to the CAISO) pursuant
to the CPUC Decisions and the Tariff, or to an LRA having jurisdiction over the LSE (and, to the
extent authorized by the LRA, to the CAISO) pursuant to the Tariff.
1.28 "Firm RA Product" is defined in the Section 3.3.
1.29 "Flexible Capacity Requirements" or "FCR" means the flexible capacity requirements established
for LSEs by the CPUC pursuant to the CPUC Decisions, or by an LRA or other Governmental Body
having jurisdiction.
1.30 "Flexible RA Product" is defined in the Section 3.2.
1.31 "Force Majeure" has the same meaning as "Uncontrollable Forces" under the Master Agreement.
1.32 "Governmental Body" means (i) any federal, state, local, municipal or other government; (ii) any
governmental, regulatory or administrative agency, commission or other authority lawfully exercising
or entitled to exercise any administrative, executive, judicial, legislative, police, regulatory or taxing
authority or power; and (iii) any court or governmental tribunal.
1.33 "Investment Grade Rating" means a rating of BBB- or better from S&P, Fitch or Kroll, or a rating of
Baa3 or better from Moody's.
1.34 "Local Area Requirements" or "LAR" means local area reliability, including any program of
localized resource adequacy requirements established for an LSE by the CPUC Decisions, CAISO,
LRA, or other Governmental Body having jurisdiction. LAR may also be known as local resource
adequacy, local RAR, "PG&E Other", "Greater Bay Area RA", or local capacity requirements in other
regulatory proceedings or legislative actions.
1.35 "LAR Attributes" means, with respect to a Unit, any and all RA Capacity and other resource
adequacy attributes (or other locational attributes related to system reliability), consistent with the
operational limitations and physical characteristics of a Unit, as they are identified as of the
Confirmation Effective Date by the CPUC Decisions, CAISO, LRA, or other Governmental Body
having jurisdiction, associated with the physical location or point of electrical interconnection of the
Unit within the CAISO Control Area, that can be counted toward an LSE's LAR, but exclusive of any
RAR Attributes which are not associated with where in the CAISO Control Area the Unit is physically
located or electrically interconnected. To the extent the CPUC Decisions, CAISO, LRA or other
Governmental Body having jurisdiction creates a new category or classification of LAR Attributes
during the term of this Transaction, and a Unit can count toward such new categories or
classifications of LAR Attributes while operating consistent with the operational limitations and
physical characteristics of such unit, including where the Unit is physically located or electrically
interconnected, any and all such new categories or classifications of LAR Attributes shall be deemed
to be part of the LAR Attributes of a Unit for the purpose of this Agreement. If the CPUC Decisions,
CAISO, LRA or other Governmental Body having jurisdiction redefines LAR whereby a Unit no
longer counts toward an LSE's LAR due to where the Unit is physically located or electrically
interconnected, then such change will not change the obligations of payments hereunder.
1.36 "LAR Showings" means the LAR Compliance Showings (or similar or successor showings) an LSE
is required to make to the CPUC (and, to the extent authorized by the CPUC, to the CAISO) pursuant
to the CPUC Decisions and the Tariff, or to an LRA having jurisdiction over the LSE (and, to the
extent authorized by the LRA, to the CAISO) pursuant to the Tariff.
1.37 "LRA" is defined in the Tariff.
1.38 "LSE" is defined in the Tariff.
1.39 "Master Agreement" is defined in the introductory paragraph hereof.
1.40 "Monthly Delivery Period" means each calendar month during the Delivery Period and shall
correspond to each Showing Month.
1.41 "Monthly RA Capacity Payment" is defined in Section 4.9.
1.42 "Net Qualifying Capacity" or "NQC" is defined in the Tariff, and is inclusive of RAR Attributes and,
if applicable, LAR Attributes, if LAR Attributes is specified in Section 3.1.
1.43 "Non -Availability Charge" is defined in the Tariff.
1.44 "Notification Deadline" in respect to a Showing Month shall be ten (10) Business Days before the
relevant Compliance Showing deadlines for the corresponding RAR Showings, LAR Showings, and
FCR Showings for such Showing Month.
1.45 "Outage" means disconnection, separation, or reduction in the capacity of any Unit that relieves
such Unit from all or part of the offer obligations of the Unit consistent with the Tariff. Outage includes
Planned Outage.
1.46 "Participating Member" means a member of Buyer that is signatory to the Third Phase Agreement.
1.47 "Party" and "Parties" have the meanings specified in the introductory paragraph hereof.
1.48 "Planned Outage" means, subject to and as further described in the CPUC Decisions and the Tariff,
an "Approved Maintenance Outage" under the Tariff, a CAISO-approved planned or scheduled
disconnection, separation or reduction in capacity of the Unit that is conducted for the purposes of
carrying out routine repair or maintenance of such Unit.
1.49 "Product" is defined in Article 3.
1.50 "Project' has the meaning set forth in the RPS Agreement.
1.51 "RA Capacity" means the qualifying and deliverable capacity of a Unit for RAR, LAR, and FCR
purposes for the Delivery Period, as determined by the CAISO, LRA or other Governmental Body
authorized to make such determination under Applicable Laws. RA Capacity encompasses the RAR
Attributes, LAR Attributes and FCR Attributes of the capacity provided by a Unit, as applicable
pursuant to this Confirmation.
1.52 "RA Capacity Price" means the price specified in the RA Capacity Price Table in Section 4.9 hereof.
1.53 "RAR" means the resource adequacy requirements, exclusive of LAR and FCR, established for
LSEs by the CPUC pursuant to the CPUC Decisions, or by an LRA or other Governmental Body
having jurisdiction.
1.54 "RAR Attributes" means, with respect to a Unit, any and all RA Capacity and other resource
adequacy attributes consistent with the operational limitations and physical characteristics of such
Unit, exclusive of any LAR Attributes and FCR Attributes. To the extent the CPUC Decisions,
CAISO, LRA or other Governmental Body having jurisdiction creates a new category or classification
of RAR Attributes during the term of this Transaction, and a Unit can count toward such new category
or classification of RA Attributes while operating consistent with the operational and physical
characteristics of such Unit, any and all such new categories or classifications of RA Attributes shall
be deemed to be part of the RAR Attributes of a Unit for the purpose of this Agreement. The above
notwithstanding, to the extent the CPUC Decisions, CAISO, LRA or other Governmental Body
having jurisdiction reduces the applicable NQC of a Unit, the NQC of a Unit may be reduced pursuant
to Section 4.4 of this Confirmation.
1.55 "RAR Showings" means the RAR Compliance Showings (or similar or successor showings) an LSE
is required to make to the CPUC (and, to the extent authorized by the CPUC, to the CAISO),
pursuant to the CPUC Decisions and the Tariff, or to an LRA having jurisdiction over the LSE (and,
to the extent authorized by the LRA, to the CAISO) pursuant to the Tariff.
1.56 "Replacement Capacity" is defined in Section 4.7.
1.57 "Replacement Unit' is defined in Section 4.5.
1.58 "Resource Category" shall be as described in the CPUC Filing Guide, as such may be modified,
amended, supplemented or updated from time to time.
1.59 "Resource Adequacy Plan" is defined in the Tariff.
1.60 "RPS Agreement' is defined in Article 6.
1.61 "Scheduling Coordinator" or "SC" is defined in the Tariff.
1.62 "Seller" is defined in the introductory paragraph hereof.
1.63 "Showing Month" shall be the calendar month during the Delivery Period that is the subject of the
RAR Showing, LAR Showing, and/or FCR Showing, as applicable, as set forth in the CPUC
Decisions or the Tariff. For illustrative purposes only, pursuant to the CPUC Decisions and the Tariff
4
in effect as of the Confirmation Effective Date, the monthly RAR Showing made in June is for the
Showing Month of August.
1.64 "Subsequent Buyer" means the purchaser of Product from Buyer in a re -sale of Product by Buyer.
1.65 "Supply Plan" means the annual and monthly supply plans, or similar or successor filings, that each
Scheduling Coordinator representing RA Capacity submits to the CAISO, LRA, or other
Governmental Body, pursuant to Applicable Laws and the Tariff, in order for that RA Capacity to
count for its RAR Attributes, LAR Attributes, and/or FCR Attributes.
1.66 "CAISO Tariff" or "Tariff" means the tariff and protocol provisions of the CAISO, including the rules,
protocols, procedures and standards attached thereto, as it may be amended, modified,
supplemented or replaced (in whole or in part) from time to time.
1.67 "Third Phase Agreement" means the agreement between Buyer and the Participating Members
that sets forth the terms and conditions under which Buyer is authorized to enter into this Agreement
on behalf of the Participating Members.
1.68 "Transaction" is defined in the introductory paragraph hereof.
1.69 "Unit" or "Units" means a resource from which Product will be provided by Seller to Buyer, including
any Replacement Unit.
1.70 "Unit EFC" means the Effective Flexible Capacity set by the CAISO for the applicable Unit.
1.71 "Unit NQC" means the Net Qualifying Capacity set by the CAISO for the applicable Unit.
ARTICLE 2
DESIGNATED UNIT(S)
2.1 Seller to Annually Designate Unit(s)
(a) On an annual basis during the Delivery Period of this Transaction, Seller shall designate the
Unit(s) from which Product will be provided from Seller to Buyer for each Showing Month of
the following calendar year, by providing written notice to Buyer with the specific Unit(s)
information contained in Appendix A-1, and the Contract Quantity that will be supplied from
specific Unit(s) listed in Appendix A-2, by no later than the earlier of (i) October 1, or (ii)
thirty (30) calendar days before the annual deadline for the year -ahead Compliance
Showing.
(b) The Unit(s) designated by Seller shall meet the Product characteristics and Contract
Quantity specified in Article 3, Article 4, the Resource Category requirements set forth in
Section 2.1(c), and as described in Appendix A.
(c) The Unit(s) designated by Seller shall (i) qualify as a Maximum Cumulative Capacity
("MCC') Resource Category 4 resource, and (ii) be able to Bid, run and operate in all hours
of the month on a 7x24 basis (planned availability is unrestricted).
(d) Nothing in this Section 2.1 shall be construed to limit the applicability of Sections 4.4
(Adjustment to Contract Quantity) or 4.5 (Alternate Capacity) of this Confirmation.
(e) Seller designation of the Unit(s) each year shall not in any way (i) convert the Contingent
Firm RA Product being sold under this Confirmation into Firm RA Product, or (ii) cause any
change to the Monthly RA Capacity Payment.
ARTICLE 3
RESOURCE ADEQUACY CAPACITY PRODUCT
During the Delivery Period, Seller shall provide to Buyer, pursuant to the terms of this Confirmation, RA
Capacity as Designated RA Capacity in the amount of the Contract Quantity of (i) RAR Attributes and, if
applicable, LAR Attributes if LAR Attributes is specified in Section 3.1, and (ii) FCR Attributes, if Flexible RA
Product is specified in Section 3.2, and the Contract Quantity shall be either a Firm RA Product or a
Contingent Firm RA Product, as specified in either Section 3.3 or Section 3.4 (the "Product"). The Product
does not confer to Buyer any right to the electrical output from a Unit, other than the right to include the
Designated RA Capacity associated with the Contract Quantity in RAR Showings, LAR Showings, and FCR
Showings, as applicable, and any other capacity or resource adequacy requirements, markets or
proceedings as specified in this Confirmation. Specifically, no energy or ancillary services associated with
any Unit is required to be made available to Buyer as part of this Transaction, and Buyer shall not be
responsible for compensating Seller for Seller's commitments of a Unit to the CAISO required by this
Confirmation. Seller retains the right to sell pursuant to the Tariff any RA Capacity from a Unit that is in
excess of that Unit's Contract Quantity and any RAR Attributes, LAR Attributes or FCR Attributes not
otherwise transferred, conveyed, or sold from Seller to Buyer under this Confirmation. Unless otherwise set
forth herein, Seller shall also retain any and all revenues received from the CAISO with respect to the
Transaction contemplated by this Confirmation.
3.1 RAR and LAR Attributes
Seller shall provide Buyer with the Designated RA Capacity of RAR Attributes and, if applicable, LAR
Attributes, if LAR Attributes is specified in Section 3.1, from each Unit, as measured in MWs, in accordance
with the terms and conditions of this Agreement:
® LAR Attributes Included
If selected, LAR Attributes to be provided from Local Capacity Area: North Coast / North
Bay
❑ LAR Attributes Not Included
3.2 ❑ Flexible RA Product
Seller shall provide Buyer with Designated RA Capacity of FCR Attributes from the Unit(s) in an amount
calculated for each Monthly Delivery Period as follows: (Contract Quantity / Unit NQC) x Unit EFC.
3.3 ❑ Firm RA Product
Seller shall provide Buyer with Designated RA Capacity from the Unit(s) in the amount of the Contract
Quantity. If the Unit(s) are not available to provide the full amount of the Contract Quantity for any reason
other than Force Majeure, including without limitation any Outage or any adjustment of the RA Capacity of
any Unit, pursuant to Section 4.4, then, Seller shall provide Buyer with Designated RA Capacity from one or
more Replacement Units. If Seller fails to provide Buyer with replacement Designated RA Capacity from
Replacement Units, then Seller shall be liable for damages and/or required to indemnify Buyer for penalties
or fines pursuant to the terms of Sections 4.7 and Section 4.8 hereof.
3.4 ® Contingent Firm RA Product
Seller shall provide Buyer with Designated RA Capacity from the Unit(s) in the amount of the Contract
Quantity; provided, however, that if (i) the Unit(s) are not available to provide the full amount of the Contract
Quantity due to Force Majeure, a Planned Outage, or a reduction of the Contract Quantity determined
pursuant to Section 4.4, and (ii) Seller has provided Buyer written notice no later than the Notification
Deadline that the full amount of Contract Quantity is not available, then Seller may either reduce the Contract
Quantity or provide Buyer with Designated RA Capacity from one or more Replacement Units pursuant to
Section 4.5 hereof for the applicable Showing Month. If Seller fails to provide Buyer with Designated RA
Capacity in the amount of the Contract Quantity (x) for any reason other than Force Majeure, a Planned
Outage, or reduction of the Contract Quantity determined pursuant to Section 4.4, or (y) Seller failed to
provide Buyer timely notice pursuant to this Section 3.4, then Seller shall be liable for damages and/or be
required to reimburse and indemnify Buyer for penalties or fines pursuant to the terms of Sections 4.7 and
Section 4.8 hereof.
ARTICLE 4
DELIVERY AND PAYMENT
4.1 Delivery Period
The Delivery Period shall be January 1, 2025 through December 31, 2036, inclusive. For the avoidance of
doubt, nothing in this Agreement shall obligate Seller to provide any Product to Buyer for any period after
the end of the Delivery Period.
4.2 Delivery Point
The Delivery Point for each Unit shall be the CAISO Control Area, and if applicable, the LAR region in which
the Unit is electrically interconnected.
4.3 Contract Quantity
The Contract Quantity of the Unit(s) for each Monthly Delivery Period is set forth in Appendix B.
4.4 Adjustments to Contract Quantity
(a) Planned Outages: If Seller is unable to provide any portion of the Contract Quantity for any
Showing Month due to a Planned Outage of a Unit, then Seller shall have the option, but
not the obligation, upon written notice to Buyer by the Notification Deadline, to either (i)
reduce the Contract Quantity for the applicable Showing Month in accordance with the
Planned Outage, or (ii) provide Alternate Capacity in accordance with Section 4.5 up to the
Contract Quantity for the applicable Showing Month.
(b) Reductions in Unit NQC: If the Product is Contingent Firm RA Product, as specified in
Section 3.4, then Seller's obligation to provide the Contract Quantity for any Showing Month
may be reduced if (i) a Unit experiences a reduction in Unit NQC as determined by the
CAISO, and (ii) Seller provides written notice of the reduction in Contract Quantity to Buyer
by the Notification Deadline for the applicable Showing Month. Seller's potential reduction
in Contract Quantity for each remaining Showing Month shall equal the product of (a) the
applicable Showing Month Contract Quantity and (b) the total amount (in MW) that a Unit
NQC was reduced since the Confirmation Effective Date, divided by (c) a Unit NQC as of
the Confirmation Effective Date. If a Unit experiences a reduction in Unit NQC, then Seller
has the option, but not the obligation, to provide the applicable Contract Quantity for such
Showing Month from (i) the same Unit, provided the Unit has sufficient remaining and
available Product and/or (ii) to provide Alternate Capacity, provided, that in each case Seller
shall provide written notice of such Replacement Units by the Notification Deadline for the
applicable Showing Month.
(c) Reductions in Unit EFC: If the Product is Contingent Firm RA Product that includes FCR
Attributes, as specified in Section 3.2, then Seller's obligation to provide FCR Attributes for
a Unit in any Showing Month may be reduced by Seller if a Unit experiences a reduction in
Unit EFC as determined by the CAISO. To the extent any such FCR Attributes reduction
occur during the Delivery Period, Seller may reduce the amount of FCR Attributes provided
to Buyer from a Unit on a pro rata basis based on the overall size (in MWs) of a Unit. For
example, if Seller provides FCR Attributes from a Unit that has an Unit NQC of 100 MW and
an Unit EFC of 100 MW, Seller's allocation of FCR Attributes to Buyer associated with 50
MW of Contract Quantity would be 50% of the Unit EFC, or 50 MW of Unit EFC. If a Unit
EFC reduction causes a Unit with a 100 MW Unit NQC to then be eligible for only 50 MW of
Unit EFC, then Seller's allocation of FCR Attributes to Buyer would be reduced on a pro rata
basis to 25 MW (i.e. 50% of a Unit's 50 MW of Unit EFC). The Parties acknowledge and
agree that any such change to the FCR Attributes shall not (i) entitle Buyer to a change in
the Contract Price or a change in the amounts payable under Section 4.9, (ii) result in any
change to Seller's obligation to provide the Contract Quantity of RAR Attributes and, if
applicable, LAR Attributes, to Buyer (iii) give either Party the right to terminate this
Agreement, or (iv) allow for the severability of any provisions of this Confirmation pursuant
to the Master Agreement.
(d) UCAP: If during the Delivery Period the CAISO, the CPUC, or the applicable Governmental
Body either replaces Unit NQC as the value utilized to measure the RA Capacity of a Unit,
with a successor value such as unforced capacity (UCAP), or utilizes such successor value
as a supplemental means of measuring the RA Capacity of a Unit together with Unit NQC,
then from and after such replacement Seller shall provide written notice and convey to Buyer
an amount of RA Capacity of a Unit of (i) no less than the amount obtained by calculating
the Buyer's share of such qualifying capacity on a pro rata basis, but (ii) no more than the
Contract Quantity (i.e. following such replacement, Seller's delivery obligation will be
obtained by calculating the product of (A) the Contract Quantity divided by a Unit NQC,
multiplied by (B) a Unit's overall qualifying capacity (in MW) as measured by such new
method of measuring a Unit's qualifying capacity). There will be no change in payments
owed by Buyer to the extent any such change in Contract Quantity is solely as result of the
UCAP calculation methodology being applied equally to similar geothermal generator
resources interconnected to the CAISO Balancing Authority Area; provided that, to the
extent a UCAP adjustment factor is applied to Seller's Unit(s) based on the historical
operations or performance of such Unit(s) that results in a Unit's overall qualifying capacity
being less than the standard UCAP adjustment factor applied to the overall qualifying
capacity for other similar geothermal generator resources interconnected to the CAISO
Balancing Authority Area, then the Contract Quantity for purposes of payment shall be
reduced by the difference (rounded to the nearest MW) between a Unit's UCAP adjustment
factor and the standard UCAP adjustment factor for other similar geothermal generator
resources interconnected to the CAISO Balancing Authority Area. After the implementation
of UCAP and the corresponding reduction in Contract Quantity, if any, set forth in the
preceding sentence, Seller shall remain solely responsible for managing its Units to ensure
that Buyer receives the Contract Quantity (as adjusted for UCAP) for the remainder of the
term of this Agreement.
(e) Force Majeure: Seller's obligation to provide the Contract Quantity for any Showing Month
may be reduced at Seller's option if (i) a Unit, or the transmission system used to deliver the
Product from a Unit to the Delivery Point, is affected by Force Majeure, so that Seller is
unable to delivery Product to Buyer for an applicable Showing Month, and (ii) Seller provides
written notice to Buyer of such reduction in Contract Quantity by the Notification Deadline
for the applicable Showing Month. If Seller is unable to provide the Contract Quantity to
Buyer for a Showing Month due to the transmission system used to deliver the Product from
a Unit to the Delivery Point being affected by Force Majeure, Seller has the option, but not
the obligation, to provide Alternate Capacity.
(f) Invoice Adjustment: In the event that the Contract Quantity is reduced due to an adjustment
to Contract Quantity pursuant to Section 4.4, and Seller does not elect to provide Alternate
Capacity pursuant to Section 4.4 and Section 4.5, then the invoice for the applicable
Showing Month, calculated pursuant to Section 4.9, shall be adjusted to reflect the reduced
amount of Contract Quantity provided from Seller to Buyer in the applicable Showing Month.
4.5 Alternate Capacity
a) If Seller desires to provide the Contract Quantity of Product to Buyer for any Showing Month
from a resource other than a Unit previously designated pursuant to Article 2 ("Alternate
Capacity"), then Seller may, at no additional cost to Buyer, provide Buyer with Alternate
Capacity from one or more replacement units (a "Replacement Unit"), with the total amount
of Product provided to Buyer from Designated RA Capacity up to an amount equal to the
Contract Quantity for an applicable Showing Month; provided that in each case, (i) Seller
shall provide written notice to Buyer of its intent to provide Alternative Capacity no later than
the Notification Deadline for an applicable Showing Month, and (ii) the Replacement Unit(s)
meet the requirements of the Product described in Article 2 and Article 3. If Seller notifies
Buyer in writing of its intent to provide Alternate Capacity no later than the Notification
Deadline for an applicable Showing Month, and the Replacement Unit(s) provided as
Alternative Capacity meet the requirements of the Product as described in Article 2 and
Article 3, then such Alternate Capacity shall be automatically deemed a Unit for purposes
of this Confirmation for that Showing Month.
4.6 Delivery of Product
Subject to Seller's rights under Article 3, Section 4.4 and Section 4.5, Seller shall provide Buyer with the
Designated RA Capacity of Product for each Showing Month consistent with the following:
a) Seller shall provide Buyer with the Designated RA Capacity of Product for each day of each
Showing Month.
b) Seller shall, on a timely basis, submit, or cause a Unit's SC to submit, by the Notification
Deadline (i) monthly Supply Plans, and (ii) annual Supply Plans if the Confirmation Effective
Date is prior to the year -ahead Compliance Showing deadline applicable for the Delivery
Period, to the CAISO, LRA, or other applicable Governmental Body in accordance with the
applicable rules and requirements (including the CAISO Tariff), identifying and confirming
the transfer of the Designated RA Capacity from Seller to Buyer for each Showing Month,
unless Buyer specifically requests in writing that Seller not do so (it being understood that
any Designated RA Capacity subject to such a request from Buyer will be deemed to have
been provided to Buyer for all purposes under this Confirmation).
C) The Product is delivered and received when the CIRA Tool shows the Supply Plan accepted
for the Product from the Unit by CAISO or Seller complies with Buyer's instruction to withhold
all or part of the Contract Quantity from Seller's Supply Plan for any Showing Month during
the Delivery Period. Seller has failed to deliver the Product if (i) Buyer has elected to submit
the Product from the Unit in its Resource Adequacy Plan and such submission is accepted
by the CPUC and the CAISO but the Supply Plan and Resource Adequacy Plan are not
matched in the CIRA Tool due solely to a Seller error, and are rejected by CAISO, or (ii)
Seller fails to submit the volume of Designated RA Capacity for any Showing Month
pursuant to this Confirmation. Buyer will have received the Contract Quantity if (x) Seller's
Supply Plan is accepted by the CAISO for the applicable Showing Month, (y) Seller correctly
submits the Supply Plan and the Supply Plan and/or Resource Adequacy Plan are not
matched in the CIRA Tool due solely to a Buyer error or (z) Seller complies with Buyer's
instruction to withhold all or part of the Contract Quantity from Seller's Supply Plan for the
applicable Showing Month. Seller will not have failed to deliver the Contract Quantity if
Buyer fails or chooses not to submit the Unit(s) and the Product in its Resource Adequacy
Plan with the CPUC or CAISO.
4.7 Damages for Failure to Provide Designated RA Capacity
If Seller fails to provide Buyer with the Designated RA Capacity of Product for any Showing Month, and
such failure is not excused under the terms of the Agreement, then the following shall apply:
(a) Buyer may, but shall not be required to, replace any portion of the Designated RA Capacity
not provided by Seller with capacity having equivalent RAR Attributes, and if applicable,
LAR Attributes and/or FCR Attributes as the Designated RA Capacity not provided by Seller,
provided, that, if any portion of the Designated RA Capacity that Buyer is seeking to replace
is Designated RA Capacity having RAR Attributes and no LAR Attributes (such capacity
shall also include FCR Attributes if specified in Section 3.2) and no such RAR capacity is
available, then Buyer may replace such portion of the Designated RA Capacity with capacity
having RAR Attributes and LAR Attributes (as well as FCR Attributes if specified in Section
3.2) ("Replacement Capacity"). Such Replacement Capacity may also be provided by
CAISO to Buyer pursuant to the Tariff. Buyer may enter into purchase transactions with
one or more parties to replace any portion of Designated RA Capacity not provided by Seller.
Additionally, Buyer may enter into one or more arrangements to repurchase its obligation to
sell and deliver capacity to another party and, to the extent such transactions are done at
prevailing market prices, such arrangements shall be considered equivalent to the
procurement of Replacement Capacity. Buyer shall use commercially reasonable efforts to
minimize damages when procuring any Replacement Capacity.
(b) Seller shall pay to Buyer at the time set forth in Section 21 of the Master Agreement, the
following damages in lieu of damages specified in Section 21 of the Master Agreement: an
amount equal to the positive difference, if any, between (i) the sum of (A) the actual cost
paid by Buyer for any Replacement Capacity, plus (B) each Capacity Replacement Price
times the amount of the Designated RA Capacity neither provided by Seller nor purchased
by Buyer pursuant to Section 4.7(a), and (ii) the Designated RA Capacity not provided for
the applicable Showing Month times the Contract Price for that month. If Seller fails to pay
these damages, then Buyer may, without limiting its other remedies, offset those damages
owed it against any future amounts it may owe to Seller under this Confirmation pursuant to
Section 28 of the Master Agreement.
4.8 Reimbursement for Failure to Deliver Contract Quantity
Subject to Seller's rights under Article 3, Section 4.4 and Section 4.5, to the extent Seller is required, and
fails, to provide the Designated RA Capacity hereunder, Seller agrees to reimburse, indemnify, defend and
hold harmless Buyer from any penalties, fines or costs assessed against Buyer by the CPUC, the CAISO,
or any other Governmental Body to the extent not otherwise paid by Seller to Buyer under Section 4.7(b),
resulting from any of the following:
(a) Seller's failure to provide any portion of the Designated RA Capacity for any portion of the
Delivery Period, and such failure is not excused under the terms of the Agreement;
(b) Seller's failure to provide notice of the non-availability of any portion of Designated RA
Capacity as required under Article 3, Section 4.5 and Section 4.6; or
(c) The Unit Scheduling Coordinator's failure to timely submit Supply Plans that identify Buyer's
right to the Designated RA Capacity purchased hereunder for an applicable Showing Month.
With respect to the foregoing, the Parties shall use commercially reasonable efforts to minimize such
penalties, fines and costs; provided, that in no event shall Buyer be required to use or change its utilization
of its owned or controlled assets or market positions to minimize these penalties, fines and costs. Seller will
have no obligation to Buyer under this Section 4.8 in respect of the portion of Contract Quantity for which
Seller has paid damages for Replacement Capacity pursuant to Section 4.7. If Seller fails to pay the
foregoing penalties, fines or costs, or fails to reimburse Buyer for those penalties, fines or costs, then Buyer
may offset those penalties, fines or costs against any future amounts it may owe to Seller under this
Confirmation pursuant to Section 28 of the Master Agreement.
4.9 Monthly RA Capacity Payment
In accordance with the terms of Section 9 of the Master Agreement, with respect to each Showing Month,
Buyer shall make a Monthly RA Capacity Payment to Seller for each Unit in arrears, after the applicable
Showing Month. Each Unit's Monthly RA Capacity Payment shall be equal to the product of (a) the
applicable Contract Price for that Monthly Delivery Period, (b) the Designated RA Capacity for the Monthly
Delivery Period, and (c) 1,000; provided, however, that the Monthly RA Capacity Payment shall be prorated
to reflect any portion of Designated RA Capacity that was not delivered pursuant to Section 4.4 at the time
of the CAISO filing for the respective Showing Month. The final product of this Monthly RA Capacity Payment
calculation shall be rounded to the nearest penny (i.e., two decimal places).
10
RA CAPACITY PRICE TABLE
Contract
Year/Month
RA Capacity Flat Price
($/kW -month)
2025-2036
4.10 Allocation of Other Payments and Costs
Seller may retain any revenues it may receive from the CAISO or any other third party with respect to any
Unit for (a) start-up, shut -down, and minimum load costs, (b) capacity revenue for ancillary services,
(c) energy sales, (d) any revenues for black start or reactive power services, or (e) the sale of the unit -
contingent call rights on the generation capacity of the Unit to provide energy to a third party, so long as
such rights do not confer to such third party the right to claim any portion of the RA Capacity sold hereunder
in order to make an RAR Showing, LAR Showing, FCR Showing, or any similar capacity or resource
adequacy showing with the CAISO, CPUC or other Governmental Body. Buyer acknowledges and agrees
that all Availability Incentive Payments are for the benefit of Seller and for Seller's account, and that Seller
shall receive, retain, or be entitled to receive all credits, payments, and revenues, if any, resulting from Seller
achieving or exceeding Availability Standards. Any Non -Availability Charges are the responsibility of Seller,
and for Seller's account, and Seller shall be responsible for all fees, charges, or penalties, if any, resulting
from Seller failing to achieve Availability Standards. If a centralized capacity market develops within CAISO,
Buyer will have exclusive rights to offer, bid, or otherwise submit Designated RA Capacity provided to Buyer
pursuant to this Confirmation for re -sale in such market, and retain and receive any and all related revenues;
provided that any such contracting shall not require Seller to incur any additional out of pocket expense or
limit or otherwise affect Seller's rights under this Transaction. However, Buyer shall be entitled to receive
and retain all revenues associated with the Designated RA Capacity of any Unit during the Delivery Period
(including any capacity or availability revenues from RMR Agreements for any Unit, Reliability Compensation
Services Tariff, and Residual Unit Commitment capacity payments, but excluding payments described in
clauses (a) through (c) above). In accordance with Section 4.9 of this Confirmation, all such revenues
received by Seller, or a Unit's SC, owner, or operator shall be remitted to Buyer, and Seller shall indemnify
Buyer for any such revenues that Buyer does not receive, and Seller shall pay such revenues to Buyer if the
Unit's SC, owner, or operator fails to remit those revenues to Buyer. If Seller fails to pay such revenues to
Buyer, Buyer may offset any amounts owing to it for such revenues against any future amounts it may owe
to Seller under this Confirmation pursuant to Section 28 of the Master Agreement.
ARTICLE 5
CAISO OFFER REQUIREMENTS
During the Delivery Period, except to the extent any Unit is in an Outage, or is affected (or its transmission
path is affected) by an event of Force Majeure that results in a partial or full Outage of that Unit, or as
otherwise provided in Section 4.4, Seller shall either schedule or cause the Unit's Scheduling Coordinator to
schedule with, or make available to, the CAISO each Unit's Designated RA Capacity in compliance with the
Tariff, and shall perform all, or cause the Unit's Scheduling Coordinator, owner, or operator, as applicable,
to perform all obligations under the Tariff that are associated with the sale of Designated RA Capacity
hereunder. Buyer shall have no liability for the failure of Seller or the failure of any Unit's Scheduling
Coordinator, owner, or operator to comply with such Tariff provisions, including any penalties or fines
imposed on Seller or the Unit's Scheduling Coordinator, owner, or operator for such noncompliance.
ARTICLE 6
EARLY TERMINATION
The Parties have entered into a separate agreement for the purchase and sale of renewable energy, which
is dated concurrently with the Confirmation Effective Date (herein after referred to as the "RPS Agreement").
The Parties agree that in the event the RPS Agreement is terminated pursuant to the Master Agreement,
11
Seller shall have the right, but not the obligation, to provide written notice to the Buyer that it is terminating
this Transaction prior to the Notification Deadline for the next applicable Showing Month, and where such
termination will become effective after the next applicable Showing Month. Termination pursuant to this
Article 6 will not be deemed a Seller Event of Default nor a Buyer Event of Default, and Seller and Buyer
shall not be subject to damages or ongoing obligations as a result of such termination.
ARTICLE 7
GENERAL REPRESENTATIONS AND WARRANTIES
In addition to the representations and warranties contained in Section 37 of the Master Agreement, each of
Buyer and Seller represents and warrants to the other party that, as of the Effective Date:
(a) it is duly organized, validly existing and in good standing under the laws of the jurisdiction
of its formation;
(b) it has all contractual, governmental, regulatory and legal authorizations necessary for it to
legally perform its obligations under this Confirmation;
(c) the execution, delivery and performance of this Confirmation are within its powers, have
been duly authorized by all necessary action;
(d) this Confirmation and each other document executed and delivered in accordance with this
Confirmation constitutes its legally valid and binding obligation enforceable against it in
accordance with its terms, subject to any bankruptcy, insolvency, reorganization and other
laws affecting creditors' rights generally, and with regard to equitable remedies, the
discretion of the court before which proceedings to obtain same may be pending; and
(e) it is acting for its own account, has made its own independent decision to enter into this
Confirmation and as to whether this Confirmation is appropriate or proper for it based upon
its own judgment, is not relying upon the advice or recommendations of the other Party in
doing so, and is capable of assessing the merits of and understanding, and understands
and accepts, the terms and conditions and risks of this Confirmation; and
(f) with respect to the Master Agreement and this Confirmation, the obligations to make
payments hereunder do not constitute or create any kind of lien on, or security interest in,
any property or revenues of Buyer.
ARTICLE 8
OTHER BUYER AND SELLER COVENANTS
Buyer and Seller shall, throughout the Delivery Period, take all commercially reasonable actions and execute
any and all documents or instruments reasonably necessary to ensure Buyer's right to the use of the Contract
Quantity for the sole benefit of Buyer's RAR, LAR and/or FCR, as applicable. Such commercially reasonable
actions shall include, without limitation:
(a) Cooperating with and providing, and in the case of Seller causing each Unit's Scheduling
Coordinator, owner, or operator to cooperate with and provide requested supporting
documentation to the CAISO, the CPUC, or any other Governmental Body responsible for
administering RAR, LAR and/or FCR under Applicable Laws, to certify or qualify the
Contract Quantity as RA Capacity and Designated RA Capacity. Such actions shall include,
without limitation, providing information requested by the CAISO, the CPUC, or by an LRA
having jurisdiction, to demonstrate for each Showing Month of the Delivery Period the ability
to deliver the Contract Quantity from each Unit to the CAISO Controlled Grid consistent with
the Product attributes described in Article 2 and Article 3 of the Confirmation, and providing
information requested by the CPUC, the CAISO or other Governmental Body having
jurisdiction to administer RAR, LAR or FCR to demonstrate that the Contract Quantity can
12
be delivered to the CAISO Controlled Grid, pursuant to "deliverability" standards established
by the CAISO, or other Governmental Body having jurisdiction to administer RAR, LAR
and/or FCR; and
(b) Negotiating in good faith to make necessary amendments, if any, to this Confirmation, which
are subject to agreement of the Parties, in each Party's sole discretion, to conform this
Transaction to subsequent clarifications, revisions, or decisions rendered by the CPUC,
CAISO, FERC, or other Governmental Body having jurisdiction to administer RAR, LAR and
FCR, so as to maintain the benefits of the bargain struck by the Parties on the Confirmation
Effective Date.
(c) If a change in Applicable Laws or in the Tariff render this Agreement or any provision hereof
incapable of being performed or administered, then either Party may request that Buyer and
Seller enter into negotiations to make the minimum changes to this Agreement necessary
to make this Agreement capable of being performed and administered, while attempting to
preserve to the maximum extent possible the benefits, burdens, and obligations set forth in
this Agreement as of the Confirmation Effective Date. Upon delivery of such a request,
Buyer and Seller shall engage in such negotiations in good faith. If Buyer and Seller are
unable, within sixty (60) days after delivery of such request, to agree upon changes to this
Agreement or to resolve issues relating to changes to this Agreement, then either Party may
submit issues pertaining to changes to this Agreement to the Dispute Resolution process
set forth in Section 34 of the Master Agreement. Notwithstanding the foregoing, a change
in cost shall not in and of itself be deemed to render this Agreement or any of the provisions
hereof incapable of being performed or administered, or constitute, or form the basis of, a
Force Majeure.
Seller represents, warrants and covenants to Buyer that, throughout the Delivery Period:
(d) Seller owns or has the exclusive right to the RA Capacity sold under this Confirmation from
each Unit, and shall furnish Buyer, CAISO, CPUC or other jurisdictional LRA, or other
Governmental Body with such evidence as may reasonably be requested to demonstrate
such ownership or exclusive right;
(e) No portion of the Contract Quantity has been committed by Seller to any third party in order
to satisfy RAR, LAR, FCR or such analogous capacity obligations in any non-CAISO or
CAISO markets, other than pursuant to an RMR Agreement between the CAISO and either
Seller or the Unit's owner or operator;
(f) Each Unit is connected to the CAISO Controlled Grid, is within the CAISO Control Area, or
is under the control of CAISO;
(g) The owner or operator of each Unit is obligated to comply with Applicable Laws, including
the Tariff, relating to RA Capacity and, as applicable, RAR, LAR and/or FCR;
(h) If Seller is the owner of any Unit, the respective cumulative sums of LAR Attributes, RAR
Attributes, and FCR Attributes that Seller has sold, assigned or transferred for any Unit does
not exceed that Unit's RA Capacity, including Unit NQC and Unit EFC, as applicable;
(i) With respect to the RA Capacity provided under this Confirmation, Seller shall, and each
Unit's Scheduling Coordinator is obligated to, comply with Applicable Laws, including the
Tariff, relating to RA Capacity, and RAR, LAR and FCR;
(j) Seller has notified the Scheduling Coordinator of each Unit that Seller has transferred the
Designated RA Capacity to Buyer, and the Scheduling Coordinator is obligated to deliver
the Supply Plans in accordance with the Tariff and this Agreement;
(k) Seller has notified the Scheduling Coordinator of each Unit that Seller is obligated to cause
each Unit's Scheduling Coordinator to provide to the Buyer, by the Notification Deadline for
each RAR Showing, LAR Showing, and/or FCR Showing, as applicable, the Designated RA
Capacity of each Unit that is to be submitted in the Supply Plan associated with this
Agreement for the applicable period; and
13
(1) Seller has notified each Unit's SC that Buyer is entitled to the revenues set forth in Section
4.10 of this Confirmation, and such SC is obligated to promptly deliver those revenues to
Buyer, along with appropriate documentation supporting the amount of those revenues.
ARTICLE 9
CONFIDENTIALITY
Except as provided in this Article 9 and the California Public Records Act, neither Party shall publish,
disclose, or otherwise divulge Confidential Information to any person at any time during or after the term of
this Agreement, without the other Party's prior express written consent; provided, however, Seller
acknowledges that Buyer is a public agency subject to the requirement of the California Public Records Act
(Cal. Gov. Code section 6250 et seq.), and therefore this Agreement and any related documents will be
subject to disclosure unless otherwise protected by the act or applicable law. Each Party shall permit
knowledge of and access to Confidential Information only to those of its affiliates and to persons investing
in, providing funding to or acquiring it or its affiliates, and to its and the foregoing persons' respective
attorneys, accountants, representatives, agents and employees who have a need to know such Confidential
Information related to this Agreement.
A Party may release Confidential Information, or a portion thereof, as required by Applicable Law. A Party
may disclose Confidential Information to accountants in connection with audits. In the event a Party is
required to release Confidential Information, such Party shall notify the other Party of the required disclosure,
such that the other Party may attempt (if such Party so chooses), at its sole cost, to cause the recipient of
the Confidential Information to treat such information in a confidential manner, and to prevent such
information from being disclosed or otherwise becoming part of the public domain.
Notwithstanding Section 30.1 of the Master Agreement and this Article 9, Buyer may disclose information
regarding this Agreement to any Governmental Body, the CPUC, the CAISO or any LRA having jurisdiction
in order to support its RAR Showings, LAR Showings and/or FCR Showings, as applicable, and Seller may
disclose the information regarding this Agreement to the Scheduling Coordinator of each Unit in order for
such Scheduling Coordinator to timely submit Supply Plans. Buyer may disclose information related to this
Transaction to a Subsequent Buyer; provided that any Subsequent Buyer agrees in writing to maintain the
confidentiality of such information consistent with this Section 9.
ARTICLE 10
BUYER'S RE -SALE OF PRODUCT
(a) Buyer may re -sell all or a portion of the Contract Quantity of Product hereunder; provided,
however, that any such re -sale does not increase Seller's obligations, costs or liabilities
hereunder. Seller will, or will cause the Unit's SC, to follow Buyer's instructions with respect
to providing such resold Product to Subsequent Buyers, to the extent such instructions are
consistent with Seller's obligations under this Confirmation. Seller will, and will cause the
Unit's SC, to take all commercially reasonable actions and execute all documents or
instruments reasonably necessary to allow such Subsequent Buyers to use such resold
Product in a manner consistent with Buyer's rights under this Confirmation. If Buyer incurs
any liability to a Subsequent Buyer due to the failure of Seller or the Unit's SC to comply
with this Confirmation, Seller will be liable to Buyer for the same amounts Seller would have
owed Buyer under this Confirmation if Buyer had not resold the Product.
(b) Buyer will notify Seller in writing of any resale of Product and the Subsequent Buyer no later
than five Business Days before the Compliance Showing deadline for the applicable
Showing Month. Buyer will notify Seller of any subsequent changes or further resales no
later than five Business Days before the Compliance Showing deadline for the applicable
Showing Month.
14
(c) If CAISO or CPUC develops a centralized capacity market, Buyer will have exclusive rights
to offer, bid, or otherwise submit the applicable Contract Quantity of Product for each day
during the Delivery Period provided to Buyer pursuant to this Confirmation for re -sale in
such market, and retain and receive all revenues from such re -sale. Seller agrees to take
all commercially reasonable actions to assist Buyer with such re -sale, provided that Seller's
obligation to assist shall not require modification of any of the commercial terms of this
Confirmation.
ARTICLE 11
MARKET BASED RATE AUTHORITY
Seller agrees, in accordance with Federal Energy Regulatory Commission (FERC) Order No. 697, to, upon
reasonable request of Buyer, submit a letter of concurrence in support of any affirmative statement by Buyer
that this contractual arrangement does not transfer "ownership or control of generation capacity" from Seller
to Buyer as the term "ownership or control of generation capacity" is used in 18 CFR Section 35.42. Seller
also agrees that it will not, in filings, if any, made subject to Order Nos. 652 and 697, claim that this
contractual arrangement conveys ownership or control of generation capacity from Seller to Buyer.
ARTICLE 12
CREDIT REQUIREMENTS
Seller and Buyer are entering into the RPS Agreement concurrently with the execution of this Confirmation.
The credit and security requirements for Seller and Buyer under this Confirmation are set forth in the RPS
Agreement. The provisions of the RPS Agreement shall govern the credit and security requirements for
this Confirmation, including, but not limited to, posting, maintenance, drawing, and release of any security
requirements. However, if the RPS Agreement is terminated for any reason, but this Confirmation
continues in force, the Parties will amend this Confirmation within thirty (30) days after such termination to
include the relevant portions of the RPS Agreement relating to credit and security requirements (with such
changes as may be necessary to reflect the differences between the two confirmations) and Schedule 1 to
the RPS Agreement, except that the amounts on Schedule 1 to the RPS Agreement will be reduced to
reflect the proportionate reduction in Buyer's and Seller's overall exposure as a result of the termination of
the RPS Agreement, as determined by Buyer and Seller in a commercially reasonable manner.
To secure its obligations under this Confirmation, and until released as provided herein, Seller hereby
grants to Buyer a present and continuing first -priority security interest in, and lien on (and right to net
against), and assignment of all cash security posted for this Confirmation, and all interest or proceeds
resulting therefrom or from the liquidation thereof, whether now or hereafter held by, on behalf of, or for the
benefit of Buyer, and Seller agrees to take all actions as Buyer reasonably requires in order to allow Buyer
to perfect Buyer's security interest in, and lien on (and right to net against), such collateral and any and all
proceeds resulting therefrom or from the liquidation thereof.
To secure its obligations under this Confirmation, and until released as provided herein, Buyer hereby
grants to Seller a present and continuing first -priority security interest in, and lien on (and right to net
against), and assignment of all cash security posted for this Confirmation, and all interest or proceeds
resulting therefrom or from the liquidation thereof, whether now or hereafter held by, on behalf of, or for the
benefit of Seller, and Buyer agrees to take all actions as Seller reasonably requires in order to allow Seller
to perfect Seller's security interest in, and lien on (and right to net against), such collateral and any and all
proceeds resulting therefrom or from the liquidation thereof.
ARTICLE 13
MASTER AGREEMENT AMENDMENTS
For this Transaction, the Master Agreement shall be amended as follows:
(a) Section 14 of the Master Agreement is amended by inserting the following new text at the
end thereof:
15
"Notwithstanding the above, for purposes of Buyer effecting a prepay transaction, Buyer
may from time to time assign the right to receive all or a portion of the Product that would
otherwise be delivered to Buyer hereunder. In connection with any such assignment to
effect a prepay transaction, Buyer and Seller agree to execute a commercially reasonable
form of assignment agreement to be agreed to by the Parties. For the avoidance of doubt,
Buyer will remain responsible for all its obligations under this Agreement related to such
assigned Product, including (i) the obligation to pay for such Product to the extent the
assignee thereof does not do so, and (ii) any damages associated with such assignee's
failure to take any such Product.
Buyer may also from time to time and at any time assign any or all of its rights, and delegate
any or all of its obligations under this Agreement, in whole or in part to one or more
Participating Members, provided, such assignment is commercially reasonable to Seller,
and provided further, Buyer obtains Seller's prior written consent for such assignment,
where such consent shall not be unreasonably withheld or delayed. Notwithstanding the
foregoing, in connection with any such assignment to one or more Participating Members,
such Participating Members shall (i) have an Investment Grade Rating at the time of the
assignment, and (ii) execute and deliver to Seller a written assumption agreement, pursuant
to a commercially reasonable form of assumption agreement to be agreed to by the Parties,
in favor of Seller pursuant to which any such Participating Member shall assume all the
obligations of Buyer under this Agreement, thereby relieving the assignor Buyer from its
duties and obligations hereunder and thereunder.
In addition, Seller has the right to assign this Agreement as collateral for any financing or
refinancing of the Project. In connection with any financing or refinancing of the Project by
Seller, Buyer shall in good faith work with Seller and its lender to execute a commercially
reasonable form of assignment agreement to be agreed to by the Parties."
(b) Section 21.1 of the Master Agreement is amended by deleting "direct" in the ninth line
thereof. The Parties also agree that the waiver on the fifth line of that section does not apply
to any damages or other remedies expressly provided for in this Confirmation.
(c) Section 22.1 of the Master Agreement is modified by deleting subsection (d) and replacing
it with "[intentionally omitted]" and by inserting the following new text at the end thereof:
"(f) the failure of the Defaulting Party to perform any material covenant or obligation set
forth in this Agreement (except to the extent constituting a separate Event of Default, and
except for such Party's obligations to deliver or receive the quantities of Product due under
this Agreement, the exclusive remedy for which is provided in this Confirmation and in
Section 21.3) if such failure is not remedied within ten (10) Business Days after written
notice;
(g) the failure of the Defaulting Party to pay its debts generally as they become due or the
Defaulting Party's admission in a writing that it is unable to generally pay its debts as they
become due;
(h) the institution, by the Defaulting Party, of a general assignment for the benefit of its
creditors; or
(i) the application for, consent to, or acquiescence to, by the Defaulting Party, the
appointment of a receiver, custodian, trustee, liquidator, or similar official for all or a
substantial portion of its assets."
16
(d) Section 22.2(b) of the Master Agreement is amended by inserting in Section 22.2, "and is
continuing" after "Event of Default occurs" in the first line thereof and deleting the second
sentence therein.
(e) Section 22.3 of the Master Agreement is amended by:
1. In Section 22.3(b), replacing the second sentence thereof with "The "Present Value
Rate" shall mean an annual rate equal to the "prime rate" as published in the Wall
Street Journal from to time plus 2%.";
2. In Section 22.3(c), deleting the third sentence thereof and replacing it with the
following: "If the Non -Defaulting Party's aggregate Gains exceed its aggregate
Losses and Costs, if any, resulting from the termination of this Agreement or a
Confirmation, the Termination Payment for all such Terminated Transactions shall
be zero, notwithstanding any provision in this Section or Agreement to the contrary."
3. In Section 22.3(e), delete the entire provision (including subsections) and replace it
with the following: "[Intentionally omitted]"
4. In Section 22.3(f), delete the entire provision and replace it with the following:
"If the Defaulting Party disagrees with the calculation of the Termination Payment
and the Parties cannot otherwise resolve their differences, and provided that
Defaulting Party has paid the undisputed part of the Termination Payment to the
Non -Defaulting Party as provided under Section 22.3(c), and that any amounts
disputed by the Defaulting Party are disputed in good faith, then the Defaulting Party
may submit the calculation issue to Dispute Resolution pursuant to Section 34."
(f) In Section 24, delete the first sentence and replace it with the following:
"This Agreement and any Confirmation shall be governed by and construed in accordance
with the laws of the State of California, without regard to the conflicts of laws rules thereof.
(g) The netting provisions of Section 28, NETTING, of the Master Agreement shall apply to the
transaction covered by this Confirmation and the RPS Agreement as if Buyer and Seller had
both executed Exhibit A, NETTING, to the Master Agreement. Both Parties intend for the
netting provisions of Exhibit A to the Master Agreement to be effective on the Confirmation
Effective Date.
(h) Section 30.1 of the Master Agreement is amended by inserting "or requested" after the word
"required" in Section 30.1(4), by deleting "or" immediately before clause (7), and by adding
the following at the end of the first sentence: "; or (8) to the Party's and such Party's affiliates'
lenders and potential lenders, investors or potential investors, counsel, accountants,
advisors and agents who have a need to know such information and have agreed to keep
such terms confidential".
(i) Section 31 of the Master Agreement is amended by deleting the second sentence thereof.
(j) Subsections 34.1 and 34.2 of the Master Agreement are hereby deleted and replaced with
the following:
"34.1 INFORMAL DISPUTE RESOLUTION
IN THE EVENT OF ANY DISPUTE ARISING UNDER THIS TRANSACTION,
WITHIN TEN (10) DAYS FOLLOWING THE RECEIPT OF A WRITTEN NOTICE FROM
17
EITHER PARTY IDENTIFYING SUCH DISPUTE, THE PARTIES SHALL MEET,
NEGOTIATE AND ATTEMPT, IN GOOD FAITH, TO RESOLVE THE DISPUTE QUICKLY,
INFORMALLY AND INEXPENSIVELY. IF THE PARTIES ARE UNABLE TO RESOLVE A
DISPUTE ARISING HEREUNDER WITHIN THIRTY (30) DAYS AFTER RECEIPT OF
SUCH NOTICE, THEN EITHER PARTY MAY SEEK ANY AND ALL REMEDIES
AVAILABLE TO IT AT LAW OR IN EQUITY, SUBJECT TO THE LIMITATIONS SET FORTH
IN THIS TRANSACTION."
"34.2 EXCLUSIVE JURISDICTION
EACH PARTY SUBMITS TO THE EXCLUSIVE JURISDICTION OF THE STATE
OR FEDERAL COURTS LOCATED IN SAN FRANCISCO, CALIFORNIA, FOR ANY
ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY TRANSACTION,
AND EXPRESSLY WAIVES ANY OBJECTION IT MAY HAVE TO SUCH JURISDICTION
OR THE CONVENIENCE OF SUCH FORUM."
(k) The phrase "arbitration or" is hereby deleted from the first line of Section 34.4.
(1) The following shall be inserted as a new Section 34.5; PROVIDED HOWEVER, THAT THE
FOLLOWING NEW SECTION 34.5 SHALL NOT LIMIT BUYER'S RIGHT TO RECOVER
FROM SELLER, OR SELLER'S OBLIGATION TO PAY BUYER, ANY AND ALL AMOUNTS
OWED UNDER SECTION 4.7 AND SECTION 4.8 OF THIS CONFIRMATION, INCLUDING
PENALTIES AS SPECIFIED THEREIN:
"34.5 LIMITATION OF DAMAGES. FOR BREACH OF ANY PROVISION OF THIS
CONFIRMATION AGREEMENT FOR WHICH AN EXPRESS REMEDY OR MEASURE OF
DAMAGES IS PROVIDED, THE EXPRESS REMEDY OR MEASURE OF DAMAGES
PROVIDED IS THE SOLE AND EXCLUSIVE REMEDY UNDER THIS AGREEMENT AND
ALL OTHER REMEDIES FOR DAMAGES AT LAW OR IN EQUITY ARE WAIVED. IF NO
EXPRESS REMEDY OR MEASURE OF DAMAGES IS PROVIDED IN THIS AGREEMENT
FOR A PARTICULAR BREACH, LIABILITY FOR THE BREACH IS LIMITED TO DIRECT
DAMAGES ONLY, WHICH SHALL BE THE SOLE AND EXCLUSIVE REMEDY UNDER
THIS AGREEMENT FOR SUCH BREACH, AND ALL OTHER REMEDIES FOR DAMAGES
AT LAW OR IN EQUITY ARE WAIVED. NEITHER PARTY IS LIABLE FOR ANY OTHER
TYPE OF DAMAGE, INCLUDING INCIDENTAL, PUNITIVE, EXEMPLARY,
CONSEQUENTIAL, SPECIAL OR INDIRECT DAMAGES OF ANY NATURE (INCLUDING
DAMAGES ASSOCIATED WITH LOST PROFITS, BUSINESS INTERRUPTION AND
LOSS OF GOODWILL) ARISING AT ANY TIME, WHETHER IN TORT (INCLUDING THE
SOLE OR CONTRIBUTORY NEGLIGENCE OF EITHER PARTY OR ANY RELATED
PERSON), WARRANTY, STRICT LIABILITY, CONTRACT OR STATUTE, UNDER ANY
INDEMNITY PROVISION, OR OTHERWISE; PROVIDED, HOWEVER, THAT THE
FOREGOING SHALL NOT LIMIT EITHER PARTY'S RIGHT TO RECOVER DAMAGES
UNDER EXPRESS INDEMNITY PROVISIONS SET FORTH IN THE CONFIRMATION."
(m) Section 41 "Witness" of the Master Agreement shall become Section 42 and the following
"Standard of Review" Section shall be substituted in its place:
"The Parties agree as follows:
Absent the agreement of all Parties to the proposed change, the standard of review
for changes to any section of this Agreement (including all Transactions and/or
Confirmations) specifying the rate(s) or other material economic terms and conditions
agreed to by the Parties herein, whether proposed by a Party, a non-party or FERC
acting sua sponte, shall be the "public interest" standard of review set forth in United
Gas Pipe Line Co. v. Mobile Gas Service Corp., 350 U.S. 332 (1956) and Federal
Power Commission v. Sierra Pacific Power Co., 350 U.S. 348 (1956)( the "Mobile -
in
Sierra" doctrine) and clarified in Morgan Stanley Capital Group, Inc. v. Public Util. Dist.
No. 1 of Snohomish 554 U.S. 527 (2008) and NRG Power Marketing LLC v. Maine
Pub. Util. Comm'n, 558 U.S. 165 (2010).
2. The Parties, for themselves and their successors and assigns, (i) agree that this
"public interest" standard shall apply to any proposed changes in any other
documents, instruments or other agreements executed or entered into by the Parties
in connection with this Agreement and (ii) hereby expressly and irrevocably waive any
rights they can or may have to the application of any other standard of review,
including the "just and reasonable" standard."
ARTICLE 14
COUNTERPARTS
This Confirmation may be signed in any number of counterparts with the same effect as if the signature to
counterparty were upon a single instrument. The Parties may rely on electric, or scanned signatures as
originals under this Confirmation. Delivery of an executed signature page of this Confirmation by facsimile
or electronic mail transmission (including PDF) shall be the same as delivery of a manually executed
signature page.
ARTICLE 15
ENTIRE AGREEMENT, NO ORAL AGREEMENTS OR MODIFICATIONS
This Confirmation sets forth the terms of the Transaction into which the Parties have entered into and
(together with the Master Agreement, as revised by this Confirmation) shall constitute the entire agreement
between the Parties relating to the purchase and sale of the Product. Notwithstanding any other provisions
of the Agreement, this Transaction may be confirmed only through a Documentary Writing executed by both
Parties, and this Transaction may only be amended or modified by a Documentary Writing executed by both
Parties.
ARTICLE 16
EMISSION PERFORMANCE STANDARD
This Agreement is a "covered procurement" under the CEC's EPS and Buyer shall make the required
compliance filing with the CEC within 10 Business Days of the Effective Date. The Parties agree that this
Agreement shall be void and all pending Product deliveries terminated no later than the effective date of any
final decision by the CEC pursuant to the California Code of Regulations, Title 20, Section 2910 that the
covered procurement fails to comply with EPS, without penalty to Buyer or Seller. The Parties acknowledge
that the Project is "determined to be compliant" pursuant to 20 CCR §§ 2903(b)(1) or (2).
[SIGNATURE PAGE FOLLOWS]
19
ACKNOWLEDGED AND AGREED TO AS OF THE CONFIRMATION EFFECTIVE DATE
Geysers Power Company, LLC
Northern California Power Agency
By: By. " '
Name: Gevan Reeves Name: Randy . Howard
Title: Vice President and Authorized Signatory Title: General Manager
Attest:
Assistant Secretary of the Commission
Approved as to Form:
/ Jane E. Luckhardt, General Counsel
ACKNOWLEDGED AND AGREED TO AS OF THE CONFIRMATION EFFECTIVE DATE
Geysers Power Company, LLC
Name: Gevan Reeves
Title: Vice President and Authorized Signatory
20
Northern California Power Agency
By:
Name: Randy S. Howard
Title: General Manager
Attest:
Assistant Secretary of the Commission
Approved as to Form:
Jane E. Luckhardt, General Counsel
By.
oda_
RA
Name: Gevan Reeves
Title: Vice President and Authorized Signatory
20
Northern California Power Agency
By:
Name: Randy S. Howard
Title: General Manager
Attest:
Assistant Secretary of the Commission
Approved as to Form:
Jane E. Luckhardt, General Counsel
Appendix A - 1
Designated Unit Information
Name:
To be provided by Seller
Location:
To be provided by Seller
CAISO Resource ID:
To be provided by Seller
Unit NQC:
To be provided by Seller
Unit EFC:
To be provided by Seller
Resource Type:
Geothermal
Resource Category (MCC 1, 2, 3
or 4):
4 (7x24 Availability)
FCR Category (1, 2 or 3):
To be provided by Seller
Path 26 (North or South):
North
Local Capacity Area (if any, as of
Confirmation Effective
Date):
NCNB
Deliverability restrictions, if any,
as described in most recent
CAISO deliverability assessment:
None
Run Hour Restrictions:
None
21
Appendix A -2
Units Comprising the Geysers geothermal power plants:
Name of Facility
Single Line Facility Name
CAISO Resource ID
CEC RPS ID WREGIS GU ID
Aidlin Power Plant
AIDLIN P.P. (CPN -1)
ADLIN_1 UNITS
60115A
W484
Sonoma Power Plant
SONOMA P.P. (CPN -3)
SMUDGO
7
UNIT 1
60010A
W127
Geysers Unit 5&6
MC CABE P.P. (CPN 5&6)
GYS5X6_7
UNITS
60002A
W117
Geysers Unit 7&8
RIDGE LINE P.P. (CPN 7&8)
GYS7X8
7
UNITS
60003A
W118
Geysers Unit 11
EAGLE ROCK P.P. (CPN -11)
GEYS11-7—U
NIT 11
60025A
W119
Geysers Unit 12
COBB CREEK PP (CPN -12)
GEYS12
7
UNIT12
60004A
W120
Geysers Unit 13
BIG GEYSERS PP (CPN -13)
GEYS13
7
UNIT13
60005A
W121
Geysers Unit 14
SULPHUR SPRINGS PP (CPN -14)
GEYS14
7
UNIT14
60026A
W122
Geysers Unit 16
QUICKSILVER PP (CPN -16)
GEYS16_7_UNIT16
60006A
W123
Geysers Unit 17
LAKE VIEW P.P. (CPN -17)
GEYS17_7_UNIT17
60007A
W124
Geysers Unit 18
SOCRATES P.P. (CPN -18)
GEYS18
7
UNIT18
60008A
W125
Calistoga Power Plant
COLISTOGA P.P. (CPN -19)
SANTF6_7_UNITS
60117A
W486
Geysers Unit 20
GRANT P.P. (CPN -20)
GEYS20
7
UNIT20
60009A
W126
22
Appendix B
Contract Quantity (MWs)
Contract
Year/Month
Contract Quantity
MWs)
January 2025
50 MW
February 2025
50 MW
March 2025
50 MW
April 2025
50 MW
May 2025
50 MW
June 2025
50 MW
July 2025
50 MW
August 2025
50 MW
September 2025
50 MW
October 2025
50 MW
November 2025
50 MW
December 2025
50 MW
Contract
Year/Month(MWS)
Contract Quantity
January 2027
100 MW
February 2027
100 MW
March 2027
100 MW
April 2027
100 MW
May 2027
100 MW
June 2027
100 MW
July 2027
100 MW
August 2027
100 MW
September 2027
100 MW
October 2027
100 MW
November 2027
100 MW
December 2027
100 MW
Contract
Year/Month
Contract Quantity
MWs)
January 2026
50 MW
February 2026
50 MW
March 2026
50 MW
April 2026
50 MW
May 2026
50 MW
June 2026
50 MW
July 2026
50 MW
August 2026
50 MW
September 2026
50 MW
October 2026
50 MW
November 2026
50 MW
December 2026
50 MW
Contract
Year/Month
Contract Quantity
MWs
January 2028
100 MW
February 2028
100 MW
March 2028
100 MW
April 2028
100 MW
May 2028
100 MW
June 2028
100 MW
July 2028
100 MW
August 2028
100 MW
September 2028
100 MW
October 2028
100 MW
November 2028
100 MW
December 2028
100 MW
23
Contract
Year/Month(MWS)
Contract Quantity
January 2029
100 MW
February 2029
100 MW
March 2029
100 MW
April 2029
100 MW
May 2029
100 MW
June 2029
100 MW
July 2029
100 MW
August 2029
100 MW
September 2029
100 MW
October 2029
100 MW
November 2029
100 MW
December 2029
100 MW
Contract
Year/Month(MWS)
Contract Quantity
January 2031
100 MW
February 2031
100 MW
March 2031
100 MW
April 2031
100 MW
May 2031
100 MW
June 2031
100 MW
July 2031
100 MW
August 2031
100 MW
September 2031
100 MW
October 2031
100 MW
November 2031
100 MW
December 2031
100 MW
Contract
Year/Month(MWS)
Contract Quantity
January 2030
100 MW
February 2030
100 MW
March 2030
100 MW
April 2030
100 MW
May 2030
100 MW
June 2030
100 MW
July 2030
100 MW
August 2030
100 MW
September 2030
100 MW
October 2030
100 MW
November 2030
100 MW
December 2030
100 MW
Contract
Year/Month(MWS)
Contract Quantity
January 2032
100 MW
February 2032
100 MW
March 2032
100 MW
April 2032
100 MW
May 2032
100 MW
June 2032
100 MW
July 2032
100 MW
August 2032
100 MW
September 2032
100 MW
October 2032
100 MW
November 2032
100 MW
December 2032
100 MW
24
Contract
Year/Month
Contract Quantity
MWs
January 2033
100 MW
February 2033
100 MW
March 2033
100 MW
April 2033
100 MW
May 2033
100 MW
June 2033
100 MW
July 2033
100 MW
August 2033
100 MW
September 2033
100 MW
October 2033
100 MW
November 2033
100 MW
December 2033
100 MW
Contract I
Year/Month(MWS)
Contract Quantity
January 2035
100 MW
February 2035
100 MW
March 2035
100 MW
April 2035
100 MW
May 2035
100 MW
June 2035
100 MW
July 2035
100 MW
August 2035
100 MW
September 2035
100 MW
October 2035
100 MW
November 2035
100 MW
December 2035
100 MW
Contract
Year/Month
Contract Quantity
MWs
January 2034
100 MW
February 2034
100 MW
March 2034
100 MW
April 2034
100 MW
May 2034
100 MW
June 2034
100 MW
July 2034
100 MW
August 2034
100 MW
September 2034
100 MW
October 2034
100 MW
November 2034
100 MW
December 2034
100 MW
Contract
Year/Month(MWS)
Contract Quantity
January 2036
100 MW
February 2036
100 MW
March 2036
100 MW
April 2036
100 MW
May 2036
100 MW
June 2036
100 MW
July 2036
100 MW
August 2036
100 MW
September 2036
100 MW
October 2036
100 MW
November 2036
100 MW
December 2036
100 MW
25
WESTERN SYSTEMS POWER POOL AGREEMENT
TRANSACTION CONFIRMATION
BETWEEN GEYSERS POWER COMPANY, LLC
AND
NORTHERN CALIFORNIA POWER AGENCY
This transaction confirmation ("Confirmation") sets forth the terms and conditions of the
transaction between Buyer and Seller, each individually a "Party" and together the "Parties," as
of the Effective Date specified below, in which Seller agrees to sell and deliver, and Buyer agrees
to purchase and receive, the Product, as such term is defined herein (the "Transaction"). This
Transaction is governed by the Western Systems Power Pool ("WSPP") Agreement (Effective
Version: August 26, 2022), together with any and all exhibits, schedules or supplements thereto
or incorporated therein by reference, as amended or modified, each in force and effect from time
to time between the Parties (collectively, the "Master Agreement"), as amended and
supplemented by this Confirmation. The Master Agreement and this Confirmation are collectively
referred to herein as the "Agreement". Capitalized terms used but not otherwise defined in this
Confirmation are defined in the Master Agreement or the Tariff (as defined below). To the extent
that this Confirmation is inconsistent with any provision of the Master Agreement, this
Confirmation shall control and shall govern the rights and obligation of the Parties in connection
with this Transaction. Except as otherwise specified, references to an "Article" or a "Section"
mean an Article or Section of this Confirmation, as applicable. This Confirmation supersedes and
replaces any prior oral or written confirmation or agreement, including broker confirmations,
regarding this Transaction.
We confirm the following terms of our Transaction:
Buyer: Northern California Power Agency
Seller: Geysers Power Company, LLC
Transaction: This Transaction is for Seller to sell and Buyer to purchase Resource
Contingent Bundled RECs, all in accordance with the terms and conditions
of this Agreement.
Effective Date: December 23 2022
Delivery Term: The "Delivery Term" shall be from January 1, 2025 to December 31, 2036,
inclusive. Notwithstanding the foregoing, for the sole purpose of matching
delivery of RECs with Delivered Energy from the Project, such period will
extend through the date that all RECs associated with such Delivered
Energy have been delivered from Seller to Buyer in accordance with this
Confirmation.
Product: "Product" or "Resource Contingent Bundled REC" means Delivered
Energy which meets the criteria for Section 399.16(b)(1)(A) of the California
Public Utilities Code, comprised of: (1) renewable energy delivered in
accordance with the terms and conditions of WSPP Service Schedule B,
(2) Renewable Energy Credits generated by the Project and transferred by
Seller through a WREGIS Certificate to Buyer under this Confirmation, and
(3) all Environmental Attributes associated with the renewable energy
delivered to Buyer as part of this Confirmation. To the extent not
inconsistent with the foregoing, the Product is a Resource Contingent
Bundled REC as such is described under Section R-2.3.4 of WSPP Service
Schedule R. The Product does not include any other non-renewable
attributes (e.g., ancillary services or resource adequacy capacity).
Project: The term "Project" means one or more of the geothermal power plants
owned or controlled by Seller and located in Lake and Sonoma Counties,
California that will be used to provide the Contract Quantity. Exhibit A
identifies each of the geothermal power plants from any of which the
Product will be produced and delivered as of the Effective Date. Due to the
portfolio nature of the Geysers, Buyer acknowledges that Seller is making
sales and deliveries from the Project to other purchasers; provided,
however, Seller shall hold title to the Resource Contingent Bundled RECs
and associated Environmental Attributes generated by the Project to meet
the Contract Quantity during the Delivery Term until delivered to Buyer at
the Delivery Point, as set forth in this Agreement. Following the Effective
Date, Seller may (i) add geothermal power plants to Exhibit A with prior
written consent of Buyer, which such consent shall not be unreasonably
withheld or delayed, or (ii) remove geothermal power plants from Exhibit A
with prior written notice to Buyer. Each Project must (i) be certified by the
CEC as an ERR for the California RPS Program and (ii) satisfy the
requirements of Section 399.16(b)(1)(A) of the California Public Utilities
Code by having a first point of interconnection with the CAISO Balancing
Authority.
Delivery: Scheduling Delivered Energy to the Delivery Point will constitute delivery
of the Product to Buyer, provided the WREGIS Certificates or RECs
evidencing the Environmental Attributes of the Product are delivered to
Buyer as provided in this Agreement.
Delivery Point: The Delivery Point for each Project shall be the Point of Interconnection
with the CAISO Balancing Authority.
Financial
Settlement Point: The Financial Settlement Point shall be the NP15 EZ Gen Hub.
Meter Data: To provide evidence of Product, in connection with submission of its
monthly invoice and upon the request of Buyer, Seller shall provide to
Buyer records of settlement quality metered data, including CAISO
metering and transaction data sufficient to document and verify the
generation and delivery of the Product to Buyer by the Project to the
Delivery Point (and upon Buyer's reasonable request access to any
records, including invoices or settlement data from the CAISO, necessary
to verify the invoice).
4
Contract Price:
Contract Quantity:
Renewable Energy
Credit Certificates
and Transfer of
RECs:
For each MWh of Product scheduled and delivered in accordance with this
Confirmation, not to exceed the Contract Quantity, Buyer shall pay Seller
the Contract Price.
"Contract Price" is as follows:
Contract Years
Price ($/MWh)
January 1, 2025 —
December 31, 2036
— per MWh of
Product
Contract Years
Contract Quantity
January 1, 2025 —
50 MW of the
December 31, 2026
Product delivered on
a 7x24 schedule
January 1, 2027 —
100 MW of the
December 31, 2036
Product delivered on
a 7x24 schedule
Seller, or Seller's QRE, shall record MWh of renewable energy produced
and delivered for this Confirmation into WREGIS for each calendar month
of the Delivery Term, and Seller shall cause the RECs created from this
renewable energy to be transferred to Buyer in accordance with the terms
and conditions of the WREGIS and WREGIS Operating Rules on a
schedule that accommodates WREGIS reporting.
Seller shall be responsible, at its sole expense, for validating, adjusting,
and disputing data with WREGIS so that the data from the Project
settlement quality meter data corresponds with the quantity of RECs
conveyed to Buyer hereunder. Upon request Seller shall provide Buyer
with copies of all material correspondence or documentation to or from
WREGIS with respect to any such validation, adjustment, or dispute.
Without limiting Seller's obligations, if a WREGIS Certificate deficit is
caused solely by an error or omission of WREGIS or the CAISO, the Parties
shall cooperate in good faith to cause WREGIS to correct its error or
omission.
Seller shall, at its sole cost and expense, take all actions and execute all
documents or instruments necessary to ensure that the RECs sold
hereunder can be transferred to Buyer utilizing WREGIS. Seller shall
comply with all laws, including, without limitation, the WREGIS Operating
Rules regarding the certification and transfer of RECs sold hereunder to
Buyer. During the Delivery Term, Seller shall have in-place, or shall submit
documentation to establish, an account with WREGIS. Seller shall transfer
RECs to Buyer in accordance with WREGIS reporting protocols and
3
WREGIS Operating Rules. Seller shall be responsible for all customary
expenses associated with WREGIS Certificate issuance fees and utilizing
WREGIS to transfer the RECs to Buyer, or its designee, except for any
costs incurred by Buyer with respect to Buyer's registration with WREGIS
and Buyer's WREGIS account.
To provide evidence of Environmental Attributes associated with the
Product, Seller shall transfer to Buyer the RECs to Buyer's WREGIS
account(s) within fifteen (15) Business Days after WREGIS creates
certificates from each month's settlement quality meter data in accordance
with the WREGIS Timelines (e.g., approximately four months after
renewable energy production and delivery under current WREGIS
operating conditions and WREGIS Timelines). If Buyer's WREGIS account
ID is not available as of the start of the Delivery Term, Buyer will provide it
to Seller promptly once Buyer receives the WREGIS account ID. Seller
shall make REC deliveries associated with the Product by transfer of
WREGIS Certificates to Buyer's WREGIS account pursuant to WREGIS
Operating Rules. Seller shall, at its option, transfer the WREGIS Certificate
using forward certificate transfer or any other transfer permitted under the
WREGIS Operating Rules. With respect to REC deliveries, Product flow
shall be considered the month in which the WREGIS Certificates are
created by WREGIS under current operating conditions.
Because WREGIS Certificates will only be created for whole MWh amounts
of renewable energy generated, any fractional MWh amounts will be
carried forward during the Delivery Term until sufficient renewable
generation is accumulated for the creation of a WREGIS Certificate to be
transferred to Buyer.
In the event WREGIS changes the WREGIS Operating Rules, or applies
the WREGIS Operating Rules in a manner inconsistent with this
Confirmation, the Parties will negotiate in good faith using commercially
reasonable efforts to revise or amend this Confirmation to the extent
possible to preserve the intended economic benefits of this Transaction for
both Parties, and so cause and enable Seller to transfer to Buyer's
WREGIS account the RECs sold to Buyer hereunder.
Buyer and Seller acknowledge and agree that the consideration for and
transfer of the Environmental Attributes is contained within the Contract
Price.
Scheduling and
Settlement: Seller shall provide (or cause to be provided) all Scheduling Coordinator
services at Seller's expense for the Project (and all units constituting the
Project) and for delivery of Product to the Delivery Point, and for scheduling
the Inter -SC Trade to deliver the value of the Delivered Energy to Buyer as
set forth herein. Buyer shall provide (or cause to be provided) all
Scheduling Coordinator services at Buyer's expense to receive Product
from Buyer, and for scheduling the Inter -SC Trade to receive the value of
the Delivered Energy as further set forth herein.
2
Seller will schedule or cause to be scheduled, at its sole discretion, Product
to the CAISO Balancing Authority on a day -ahead, hour -ahead, sub -hourly
and/or real-time basis. All Product will be scheduled in accordance with
Generally Accepted Utility Practice and the Tariff.
Based on the CAISO market scheduling and settlement protocols in place
as of the Effective Date, CAISO will pay or charge Seller the CAISO Credit
for the energy value of Delivered Energy produced and delivered from the
Project to the Delivery Point on behalf of the Buyer. To transfer the energy
value of the Delivered Energy produced and delivered from the Project from
Seller to Buyer, Seller will schedule Inter -SC Trades on a Day -Ahead basis
at the Financial Settlement Point in an amount equal to the Contract
Quantity to effectuate the transfer of the energy value of Delivered Energy
from Seller to Buyer, and Buyer will schedule Inter -SC Trades on a Day -
Ahead basis at the Financial Settlement Point in an amount equal to the
Contract Quantity to effectuate the receipt of the energy value of Delivered
Energy from Seller to Buyer. Consequently, and consistent with applicable
netting provisions of the Master Agreement, Seller and Buyer hereby agree
that the energy value of Delivered Energy will be transferred from Seller to
Buyer by scheduling Inter -SC Trades on a Day -Ahead basis at the
Financial Settlement Point between Seller and Buyer, and Seller shall be
responsible for all CAISO costs (including penalties, costs associated with
scheduling and settling Inter -SC Trades on a day -ahead basis at the
Financial Settlement Point, and other charges) and shall be entitled to all
CAISO credits (including CAISO Credits and payments) associated with
the Project and the delivery of energy to the Delivery Point, and Buyer shall
be responsible for all CAISO costs and shall be entitled to all CAISO credits
associated with scheduling Inter -SC Trades on a Day -Ahead basis at the
Financial Settlement Point to effectuate the receipt of the energy value of
Delivered Energy from Seller to Buyer.
In the event the amount of Delivered Energy produced and delivered from
the Project is less than the Contract Quantity in any monthly period, the
payment from Buyer to Seller for Delivered Energy for that monthly period
will be adjusted to account for the MWh difference between the Contract
Quantity scheduled from Seller to Buyer as an Inter -SC Trade at the
Financial Settlement Point, and the actual amount of Delivered Energy
produced and delivered from the Project at the Delivery Point, as follows:
Payment Due = (Contract Quantity * Contract Price) + ((Delivered Energy
— Contract Quantity) * Environmental Attribute Price)
In the event Seller forecasts that the amount of Delivered Energy to be
produced and delivered from the Project during a period of time will be less
than the Contract Quantity due to an excused event as set forth in Section
R-2.3.4 of WSPP Service Schedule R or WSPP Service Schedule B, Seller
will promptly notify Buyer of the reduced amount of Delivered Energy that
is forecasted to be produced and delivered during a period of time, and the
Parties will timely coordinate in a commercially reasonable manner to make
adjustments to the MWh quantity of Inter -SC Trades that are to be
scheduled at the Financial Settlement Point by Seller and Buyer during the
5
specified period of time to match the amount of Delivered Energy that is
forecasted to be produced and delivered from the Project
Invoicing and
Payment: For the purposes of this Transaction, invoicing and payment for the Product
and Environmental Attributes delivered to Buyer, as further set forth in this
Confirmation, will be in accordance with Section 9 of the Master
Agreement.
Eligibility: Seller, and, if applicable, its successors, represents and warrants that
throughout the Delivery Term of this Agreement that: (i) the Project qualifies
and is certified by the CEC as an Eligible Renewable Energy Resource
("ERR") as such term is defined in Public Utilities Code Section 399.12 or
Section 399.16; and (ii) the Project's output delivered to Buyer qualifies
under the requirements of the California Renewables Portfolio Standard.
To the extent a Change in Law occurs after execution of this Agreement
that causes this representation and warranty to be materially false or
misleading, it shall not be an Event of Default if Seller has used
commercially reasonable efforts to comply with such Change in Law. [STC
6, Non -Modifiable. (Source: D.07-11-025, Attachment A) D.08-04-0091
Commercially reasonable efforts shall be those efforts described in the
Change in Law provision of this Confirmation.
Seller will be responsible for ensuring that (i) each Project is certified as an
ERR for the California RPS Program prior to delivery of Resource
Contingent Bundled RECs hereunder from such Project; and (ii) the
Environmental Attributes have been or will be transferred to Seller and will
be transferrable to Buyer through or using WREGIS, or such similar
generation information or attributes tracking system as may be approved
by or other method of transfer acceptable to the Energy Commission.
Vintage: Calendar Year 2025 through Calendar Year 2036, inclusive.
Environmental
Attributes: All Attributes, such is described under Section R-2.4.1 of WSPP Service
Schedule R. The Parties agree that the Product will be sourced only from
the Projects identified in the Confirmation with no substitutions.
Applicable
Program: State of California Renewable Portfolio Standard Program (hereinafter
referred to as "California Renewables Portfolio Standard" or "California
RPS Program" or "RPS", as codified at California Public Utilities Code
Section 399.11 et seq., and jointly administered by the CEC and the CPUC,
including without limitation all applicable eligibility criteria and requirements
thereof, and implemented in a manner consistent with the Enforcement
Procedures for the Renewables Portfolio Standard for Local Publicly
Owned Electric Utilities, as adopted by the California Energy Commission
on December 22, 2020, and requiring that a specified percentage of a load -
serving entity's retail sales should be supplied with electricity generated by
ERRs.
9
WSPP Service
Schedule R: This Confirmation incorporates Service Schedule R of the Master
Agreement, which shall govern this Transaction except as modified in this
Confirmation. References herein to sections in Schedule R shall appear,
for example, as "Section R-2.3.4".
Representations
And Warranties: As of the Effective Date, each Party represents and warrants to the other
Party that: (i) it is duly organized, validly existing and in good standing
under the laws of the jurisdiction of its formation; (ii) it has authority and
ability to enter into this Agreement and perform its obligations hereunder;
(iii) it is acting for its own account and is not relying upon any representation
of the other Party other than those expressly set forth herein; and (iv) it has
entered into this Agreement in connection with the conduct of its business
and it has the capacity or ability to produce and deliver or take delivery of
all Product referred to in the Agreement to which it is a Party.
Seller further represents and warrants to Buyer that:
Seller hereby provides and conveys all Environmental Attributes
associated with the electricity generation from the Project to Buyer
as part of the Product being delivered. Seller represents and
warrants that Seller holds the rights to all such Environmental
Attributes from the Project, and Seller agrees to convey and hereby
conveys all such Environmental Attributes to Buyer as included in
the delivery of the Product from the Project.
Seller and, if applicable, its successors, represents and warrants
that throughout the Delivery Term of this Agreement the Renewable
Energy Credits transferred to Buyer conform to the definition and
attributes required for compliance with the California RPS Program
and California Renewables Portfolio Standard, as set forth in
California Public Utilities Commission Decision 08-08-028, and as
may be modified by subsequent decision of the California Public
Utilities Commission or by subsequent legislation. To the extent a
Change in Law occurs after execution of this Agreement that
causes this representation and warranty to be materially false or
misleading, it shall not be an Event of Default if Seller has used
commercially reasonable efforts to comply with such Change in
Law. [STC REC-1, Non -modifiable. D.11-01-0251 Commercially
reasonable efforts shall be those efforts described in the Change in
Law provision of this Confirmation.
iii. Tracking of RECs in WREGIS. Seller warrants that all necessary
steps to allow the Renewable Energy Credits transferred to Buyer
to be tracked in the Western Renewable Energy Generation
Information System will be taken prior to the first delivery under the
contract. [STC REC-2, Non -modifiable. D.11-01-025]
iv. Seller has not sold the Product or any Environmental Attribute of
the Product to be transferred to Buyer to any other person or entity.
7
V. The Product produced and delivered from Seller to Buyer is from
the electric energy generated by the Project.
vi. Each Project has a first point of interconnection with the CAISO
Balancing Authority.
vii. The Product to be purchased and sold pursuant to this Confirmation
are not committed to another party.
viii. All rights, title and interest in and to the Product are free and clear
of any taxes or security interests, claims, or other encumbrances or
any interest therein, or thereto, by any Person.
ix. Subject to the Change of Law provision below, the Product meets
the criteria set forth in California Public Utilities Code Section
399.16(b)(1). Seller shall provide any documentation required by
the CPUC or CEC to support the Product's classification as a
Portfolio Content Category 1 Product as set forth in California Public
Utilities Code Section 399.16(b)(1)(A).
X. Seller shall obtain, maintain, and remain in material compliance with
all permits, interconnection agreements, and transmission rights
necessary to operate the Project and to deliver Product from the
Project to the Delivery Point.
Change in Law
Provisions:
a) The Product shall be Regulatorily Continuing requiring that Seller make
commercially reasonable efforts to obtain compliance with Changes in Law in the
California RPS Program, provided that such costs should not be greater than
fifteen thousand dollars ($15,000) per MW of Contract Quantity (the "Capped
Amount"). This provision shall not apply to any Product that was delivered and
accepted prior to any Change in Law if such Product complies with the California
RPS Program that existed when it was delivered and accepted.
b) This Confirmation is executed for the express purpose of complying with the
California RPS Program and Section 399.16(b)(1)(A) of the California Public
Utilities Code. Notwithstanding subsection (a), and subject to subsection (c), (i) if
a Change in Law occurs after the Effective Date that causes the Product to cease
to be compliant with the California RPS Program, Seller shall comply with such
Change in Law and, subject to the Capped Amount, cause the Product to be
compliant with the California RPS Program and continue to maintain compliance
with the California RPS Program after having brought the Product back into
compliance for the remainder of the Delivery Term; and (ii) if the California RPS
Program is replaced or superseded with any successor renewable portfolio
standard or similar program or any Governmental Body implements a regulation
of any Environmental Attribute associated with the Product, including the limitation
of greenhouse gases, then (A) the Parties shall in good faith amend the terms of
this Agreement to comply with the requirements of such successor standard or
new environmental attribute law or regulation in order to effect the original intent
of this Agreement; provided that neither such amendment nor the Parties' failure
to enter into such amendment shall (1) relieve Seller of its obligations for the cost
A
of Compliance Actions up to the Capped Amount, (2) diminish Buyer's rights or
benefits hereunder, or (3) increase or decrease Buyer's obligations or liabilities
hereunder, including payment obligations, unless otherwise set forth herein and
(B) Seller shall comply with the requirements of such successor renewable
portfolio standard, similar program or regulation of any Environmental Attribute
associated with the Product, including the limitation of greenhouse gases, in
accordance with the amended version of this Agreement. Seller shall be
responsible for all costs and expenses incurred by either Party in the performance
of the Parties' obligations under the forgoing clauses (i) and (ii)(B) (collectively, the
"Compliance Actions") up to the Capped Amount.
c) If Seller reasonably expects that the costs necessary to cause the Product to be
compliant with the California RPS Program, or to cause the Product to comply with
any successor RPS law or new environmental attribute law or regulation, will
exceed the Capped Amount even after Seller's future efforts to comply with such
Change in Law, including Seller's expenditure in an amount equal to or greater
than Capped Amount, then, in either case, Seller shall promptly provide notice to
Buyer of the foregoing. Within thirty (30) Business Days after such notice, Seller
shall, at its sole expense, deliver to Buyer a reasonably detailed report (the
"Compliance Action Plan") consisting of (A) the Compliance Actions that Seller
has performed and an itemized list of costs of such Compliance Actions, (B)
Seller's proposed additional Compliance Actions and a good faith itemized
estimate of the applicable costs, and (C) a good faith estimate of the date that the
Product will again be compliant with the California RPS Program or Product will be
in compliance with the successor RPS law or new environmental attribute law or
regulation, as applicable, (the aggregate estimated costs of all performed and
proposed Compliance Actions, "Compliance Action Plan Estimate").
d) If Buyer approves of the Compliance Action Plan, then either Party may elect to
pay costs in excess of the Capped Amount ("Excess Compliance Costs"). If a
Party does elect to pay Excess Compliance Costs, then Seller shall be responsible
for all Compliance Action costs up to the Capped Amount, and the electing Party
shall be responsible for costs in excess thereof. If, after 60 days of the date that
Buyer approves the Compliance Action Plan ("Compliance Plan Consideration
Period"), neither Party has provided notice to the other Party in writing of its
election to pay the Excess Compliance Costs, then, upon notice to be delivered to
the other Party within ten (10) Business Days of the end of the Compliance Plan
Consideration Period, (1) Buyer may, in its sole discretion and without penalty to
Buyer, terminate this Agreement with respect to some or all of the Contract
Quantity, effective upon notice to Seller, or (2) Seller may, in its sole discretion and
without penalty to Seller, terminate this Agreement with respect to all of the
Contract Quantity effective upon notice to Buyer.
e) If Seller reasonably determines that its preparation and delivery of a Compliance
Action Plan would be futile because it is clear that, even if Seller takes Compliance
Actions and incurs cost equal to the Capped Amount, the Product cannot be made
compliant with the California RPS Program following a Change in Law or the
Product cannot comply with a successor RPS law or a new environmental attribute
law or regulation, then Seller shall promptly provide a notice to Buyer of the
foregoing (such notice, an "Infeasibility Notice"). If it is possible to amend this
Agreement to (a) make the Product compliant with the California RPS Program,
(b) ensure that Buyer will bear no additional costs, obligations, or risks hereunder,
9
and (c) ensure that Buyer's rights and benefits hereunder will not be diminished,
then the Parties shall negotiate in good faith to amend the terms of the Agreement.
If such an amendment is not possible, then within ten (10) Business Days of
delivery of such notice, (1) Buyer may, in its sole discretion and without penalty to
Buyer, terminate this Agreement with respect to some or all of the Contract
Quantity, effective upon notice to Seller, or (2) Seller may, in its sole discretion and
without penalty to Seller, terminate this Agreement with respect to all of the
Contract Quantity effective upon notice to Buyer.
f) If Buyer and Seller disagree with the contents of the Compliance Action Plan or
the Infeasibility Notice, then the Parties shall engage in Dispute Resolution
pursuant to Section 34.
g) Except after a Change in Law or if the California RPS Program or any portion
thereof is repealed or ceases to be in effect and is not replaced with a comparable
law, from time to time and at any time requested by Buyer, Seller shall furnish to
Buyer, Governmental Authorities, or other Persons designated by Buyer, all
certificates and other documentation reasonably requested by Buyer in order to
demonstrate that the Product is compliant with the California RPS Program.
Reporting
Obligation: Buyer shall have no responsibility (whether regulatory or financial) for
greenhouse gas emissions associated with the Product (if any), and any
such obligation shall be fulfilled by or at the direction of Seller at its own
cost.
Review: To monitor compliance with this Confirmation, each Party reserves the right
to review during normal business hours and at its own expense, for up to
two (2) years following delivery of the Product under this Confirmation, and
with reasonable advance notice to the other Party, and to the extent that
such other Party is in possession of such information, information required
to verify that the Product sold under this Confirmation was not otherwise
sold by Seller to a third party.
Confidentiality: Except as provided in this Confidentiality section and the California Public
Records Act, and subject to and without limiting Section R-7, neither Party
shall publish, disclose, or otherwise divulge Confidential Information to any
person at any time during or after the term of this Agreement, without the
other Party's prior express written consent; provided, however, Seller
acknowledges that Buyer is a public agency subject to the requirement of
the California Public Records Act (Cal. Gov. Code section 6250 et seq.),
and therefore this Agreement and any related documents will be subject to
disclosure unless otherwise protected by the act or applicable law. Each
Party shall permit knowledge of and access to Confidential Information only
to those of its affiliates and to persons investing in, providing funding to or
acquiring it or its affiliates, and to its and the foregoing persons' respective
attorneys, accountants, representatives, agents and employees who have
a need to know such Confidential Information related to this Agreement.
A Party may release Confidential Information, or a portion thereof, as
required by Applicable Law. A Party may disclose Confidential Information
to accountants in connection with audits. In the event a Party is required
10
to release Confidential Information, such Party shall notify the other Party
of the required disclosure, such that the other Party may attempt (if such
Party so chooses), at its sole cost, to cause the recipient of the Confidential
Information to treat such information in a confidential manner, and to
prevent such information from being disclosed or otherwise becoming part
of the public domain. Parties acknowledge that Buyer is obligated to
provide Confidential Information to the CPUC and CEC for regulatory
compliance purposes for the California RPS Program, and Seller waives
the prior notice requirement and authorizes such disclosures to the CPUC
and CEC.
Applicable Law/
Governing Law: This Agreement and the rights and duties of the Parties hereunder shall be
governed by and construed, enforced and performed in accordance with
the laws of the state of California, without regard to principles of conflicts
of Law. To the extent enforceable at such time, each Party waives its
respective right to any jury trial with respect to any litigation arising under
or in connection with this Agreement. [STC 17, Applicable Law, Non -
modifiable. (Source: D.07-11-025, Attachment A) D.08-04-009]
Additional
Terms:
a) Seller shall agree to reasonably assist Buyer with Buyer's California Renewables
Portfolio Standard Program compliance filings as reasonably requested by Buyer. In
connection with the foregoing, neither Seller nor its affiliates shall be required to (i)
expend or incur any legal costs (either internal or external) in providing such
assistance or (ii) prepare or defend a filing or otherwise advocate on behalf of Buyer,
except to the extent caused by Seller or affiliate's acts or omissions.
b) Notwithstanding anything else in this Confirmation, and subject to Seller's obligations
under this Confirmation, Buyer acknowledges and agrees that the sale of renewable
energy and RECs by Seller from the Project is nonexclusive; provided, such
nonexclusively shall not release Seller of its obligations under the Confirmation.
c) Seller Credit Requirements: Seller and Buyer are entering into the RA Agreement
concurrently with the execution of this Confirmation. Only in the event of a Seller
Downgrade Event will Seller be required to post and maintain from time to time security
in the amount and for the periods set forth on Schedule 1 to secure its obligations
under both this Confirmation and the RA Agreement; provided that Buyer may only
draw on such security (i) to recover damages payable under this Confirmation and the
RA Agreement, and (ii) as a result of an Event of Default for which there exist any
unsatisfied payment obligation. If the RA Agreement is terminated for any reason, but
this Confirmation continues in force, the amounts on Schedule 1 will be reduced to
reflect the proportionate reduction in Buyer's overall exposure as a result of the
termination of the RA Agreement, as determined by Buyer in a commercially
reasonable manner, and the Parties will amend and replace Schedule 1 to reflect this
reduction within thirty (30) days after termination of the RA Agreement. On the dates
when the required amount of such security is reduced as set forth on Schedule 1, if
the security has been provided in cash, Buyer shall return any cash security that it
holds in excess of the required amount, and if the security has been provided in the
form of a letter of credit, Buyer will cooperate with Seller in substituting a revised letter
11
of credit in the appropriate amount for the one held by Buyer. The security shall be
posted with Buyer as soon as possible, but in no event later than ten (10) Business
Days after the occurrence of a Seller Downgrade Event. Such security may be
provided in cash (to be held in an escrow account pursuant to an escrow agreement
with a Qualified Issuer in form and substance satisfactory to Buyer) or by a letter of
credit substantially in the form attached hereto and incorporated herein as Exhibit B.
Once Seller has resolved the Downgrade Event by achieving an Investment Grade
Rating or by satisfying such other requirements as are set forth herein, the Downgrade
Event shall be deemed resolved and Seller shall no longer be required to post security
under this Confirmation or the RA Agreement; provided, however, in the event of a
subsequent Seller Downgrade Event, the security posting requirements set forth in the
Confirmation shall continue to apply until the Seller Downgrade Event has been
resolved. Buyer shall return any cash or letters of credit held as security hereunder to
Seller within thirty (30) days after written notice from Seller that the Seller Downgrade
Event has been resolved by Seller achieving an Investment Grade Rating or satisfying
such other requirements as are set forth herein.
If Seller provides security in the form of a letter of credit, Seller will provide and
maintain a letter of credit to the benefit of Buyer substantially in the form attached
hereto and incorporated herein as Exhibit B (attached hereto and incorporated herein
by reference) from a United States bank or a bank that maintains a United States
domestic branch with a long-term debt rating from at least two rating agencies of at
least "A-" or equivalent from Moody's, Standard & Poor's ("S&P"), or Fitch Ratings
("Fitch") (or if only one rating is available, a rating of at least "AA -"or equivalent).
To secure its obligations under this Confirmation, and until released as provided
herein, Seller hereby grants to Buyer a present and continuing first -priority security
interest in, and lien on (and right to net against), and assignment of all cash security
posted for this Confirmation, and all interest or proceeds resulting therefrom or from
the liquidation thereof, whether now or hereafter held by, on behalf of, or for the benefit
of Buyer, and Seller agrees to take all action as Buyer reasonably requires in order to
allow Buyer to perfect Buyer's security interest in, and lien on (and right to net against),
such collateral and any and all proceeds resulting therefrom or from the liquidation
thereof.
d) Buyer Credit Requirements: Seller and Buyer are entering into the RA Agreement
concurrently with the execution of this Confirmation. Only in the event of a Buyer
Downgrade Event will Buyer be required to post and maintain security in the amount
and for the periods set forth on Schedule 1 to secure its obligations under both this
Confirmation and the RA Agreement; provided that Seller may only draw on such
security (i) to recover damages payable under this Confirmation and the RA
Agreement, and (ii) as a result of an Event of Default for which there exist any
unsatisfied payment obligation. If the RA Agreement is terminated for any reason, but
this Confirmation continues in force, the amounts on Schedule 1 will be reduced to
reflect the proportionate reduction in Seller's overall exposure as a result of the
termination of the RA Agreement, as determined by Seller in a commercially
reasonable manner, and the Parties will amend and replace Schedule 1 to reflect this
reduction within thirty (30) days after termination of the RA Agreement. On the dates
when the required amount of such security is reduced as set forth on Schedule 1, if
the security has been provided in cash, Seller shall return any cash security that it
holds in excess of the required amount, and if the security has been provided in the
form of a letter of credit, Seller will cooperate with Buyer in substituting a revised letter
12
of credit in the appropriate amount for the one held by Seller. The security shall be
posted with Seller as soon as possible, but in no event later than ten (10) Business
Days after the occurrence of a Buyer Downgrade Event. Such security may be
provided in cash (to be held in an escrow account pursuant to an escrow agreement
with a Qualified Issuer in form and substance satisfactory to Seller) or by a letter of
credit substantially in the form attached hereto and incorporated herein as Exhibit B.
Once Buyer has resolved the Downgrade Event by achieving an Investment Grade
Rating or by satisfying such other requirements as are set forth herein, the Downgrade
Event shall be deemed resolved and Buyer shall no longer be required to post security
under this Confirmation or the RA Agreement; provided, however, in the event of a
subsequent Buyer Downgrade Event, the security posting requirements set forth in the
Confirmation shall continue to apply until the Buyer Downgrade Event has been
resolved. Seller shall return any cash or letters of credit held as security hereunder to
Buyer within thirty (30) days after written notice from Buyer that the Buyer Downgrade
Event has been resolved by Buyer achieving an Investment Grade Rating or satisfying
such other requirements as are set forth herein.
If Buyer provides security in the form of a letter of credit, Buyer will provide and
maintain a letter of credit to the benefit of Seller substantially in the form attached
hereto and incorporated herein as Exhibit B (attached hereto and incorporated herein
by reference) from a United States bank or a bank that maintains a United States
domestic branch with a long-term debt rating from at least two rating agencies of at
least "A-" or equivalent from Moody's, S&P, or Fitch (or if only one rating is available,
a rating of at least "AA -"or equivalent).
To secure its obligations under this Confirmation, and until released as provided
herein, Buyer hereby grants to Seller a present and continuing first -priority security
interest in, and lien on (and right to net against), and assignment of all cash security
posted for this Confirmation, and all interest or proceeds resulting therefrom or from
the liquidation thereof, whether now or hereafter held by, on behalf of, or for the benefit
of Seller, and Buyer agrees to take all action as Seller reasonably requires in order to
allow Seller to perfect Seller's security interest in, and lien on (and right to net against),
such collateral and any and all proceeds resulting therefrom or from the liquidation
thereof.
e) Early Termination: The Parties have entered into a separate agreement for the
purchase and sale of resource adequacy products, as further set forth therein, which
is dated concurrently with the Effective Date (herein after referred to as the "RA
Agreement"). The Parties agree that in the event the RA Agreement is terminated
pursuant to the Master Agreement, Seller shall have the right, but not the obligation,
to provide thirty (30) days prior written notice to Buyer that it is terminating this
Transaction, effective as of the last date of the calendar month in which such notice is
received by the other Party. Early Termination pursuant to this Section of the
Confirmation will not be deemed a Seller Event of Default nor a Buyer Event of Default,
and Seller and Buyer shall not be subject to damages or ongoing obligations as a
result of such termination.
f) Counterparts: This Confirmation may be signed in any number of counterparts with
the same effect as if the signature to the counterparts were upon a single instrument.
The Parties may rely on electronic, or scanned signatures as originals under this
Confirmation. Delivery of an executed signature page of this Confirmation by facsimile
13
or electronic mail transmission (including PDF) shall be the same as delivery of a
manually executed signature page.
g) Entire Agreement, No Oral Agreements or Modifications. This Confirmation sets forth
the terms of the Transaction into which the Parties have entered into and (together
with the Master Agreement, as revised by this Confirmation) shall constitute the entire
agreement between the Parties relating to the purchase and sale of the Product.
Notwithstanding any other provisions of the Agreement, this Transaction may be
confirmed only through a Documentary Writing executed by both Parties, and this
Transaction may only be amended or modified by a Documentary Writing executed by
both Parties.
h) Buyer's Re -Sale of Product. Buyer may re -sell all or a portion of the Contract Quantity
of Product hereunder; provided, however, that any such re -sale does not increase
Seller's obligations, costs or liabilities hereunder. Seller will, or will cause the
Scheduling Coordinator for the Project, to follow Buyer's instructions with respect to
providing such resold Product to a subsequent buyer, to the extent such instructions
are consistent with Seller's obligations under this Confirmation. Seller will, and will
cause the Project Scheduling Coordinator, to take all commercially reasonable actions
and execute all documents or instruments reasonably necessary to allow such
subsequent buyer to use such resold Product in a manner consistent with Buyer's
rights under this Confirmation. If Buyer incurs any liability to a subsequent buyer due
to the failure of Seller to comply with this Confirmation, Seller will be liable to Buyer for
the same amounts Seller would have owned Buyer under this Confirmation if Buyer
had not resold the Product.
i) Failure to Deliver/Receive. For purpose of this Transaction, the determination of the
Replacement Price will be based on the energy and Environmental Attributes
components of the Product and damages will be calculated in a commercially
reasonable manner consistent with the Master Agreement, unless otherwise set forth
herein.
j) Forward Contract. This Confirmation constitutes a sale of a nonfinancial commodity
for deferred shipment or delivery that the Parties intend to be physically settled and is
excluded from the term "swap" as defined in the Commodity Exchange Act under 7
U.S.C. § 1a(47) and the regulations of the Commodity Future Trading Commission
and Securities and Exchange Commission, with further reference to 77 Fed. Reg.
48233-35.
k) Emission Performance Standard. This Agreement is a "covered procurement" under
the CEC's EPS and Buyer shall make the required compliance filing with the CEC
within 10 Business Days of the Effective Date. The Parties agree that this Agreement
shall be void and all pending Product deliveries terminated no later than the effective
date of any final decision by the CEC pursuant to the California Code of Regulations,
Title 20, Section 2910 that the covered procurement fails to comply with EPS, without
penalty to Buyer or Seller. The Parties acknowledge that the Project is "determined to
be compliant" pursuant to 20 CCR §§ 2903(b)(1) or (2).
14
1) Master Agreement Amendments. For this Transaction, the Master Agreement shall
be amended as follows:
(i) Section 14 of the Master Agreement is amended by inserting the following new
text at the end thereof:
"Notwithstanding the above, for purposes of Buyer effecting a prepay
transaction, Buyer may from time to time assign the right to receive all or a
portion of the Product that would otherwise be delivered to Buyer hereunder.
In connection with any such assignment to effect a prepay transaction, Seller
and Buyer agree to execute a commercially reasonable form of assignment
agreement to be agreed to by the Parties. For the avoidance of doubt, Buyer
will remain responsible for all its obligations under this Agreement related to
such assigned Product, including (i) the obligation to pay for such Product to
the extent the assignee thereof does not do so, and (ii) any damages
associated with such assignee's failure to take any such Product.
Buyer may also from time to time and at any time assign any or all of its rights,
and delegate any or all of its obligations under this Agreement, in whole or in
part to one or more Participating Members, provided, such assignment is
commercially reasonable to Seller and provided further, Buyer obtains Seller's
prior written consent for such assignment, which such consent shall not be
unreasonably withheld or delayed. Notwithstanding the foregoing, in
connection with any such assignment to one or more Participating Members,
such Participating Members shall (i) have an Investment Grade Rating at the
time of the assignment, and (ii) execute and deliver to Seller a written
assumption agreement, pursuant to a commercially reasonable form of
assumption agreement to be agreed to by the Parties, in favor of Seller
pursuant to which any such Participating Member shall assume all the
obligations of Buyer under this Agreement, thereby relieving the assignor
Buyer from its duties and obligations hereunder and thereunder.
In addition, Seller has the right to assign this Agreement as collateral for any
financing or refinancing of the Project. In connection with any financing or
refinancing of the Project by Seller, Buyer shall in good faith work with Seller
and its lender to execute a commercially reasonable form of assignment
agreement to be agreed to by the Parties."
(ii) Section 21.1 of the Master Agreement is amended by deleting "direct" in the
ninth line thereof. The Parties also agree that the waiver on the fifth line of that
section does not apply to any damages or other remedies expressly provided
for in this Confirmation.
(iii) Section 22.1 of the Master Agreement is modified by deleting subsection (d)
and replacing it with "[intentionally omitted]" and by inserting the following new
text at the end thereof:
"(f) the failure of the Defaulting Party to perform any material covenant or
obligation set forth in this Agreement (except to the extent constituting a
separate Event of Default, and except for such Party's obligations to deliver or
receive the quantities of Product due under this Agreement, the exclusive
15
remedy for which is provided in this Confirmation and in Section 21.3) if such
failure is not remedied within ten (10) Business Days after written notice;
(g) the failure of the Defaulting Party to pay its debts generally as they become
due or the Defaulting Party's admission in a writing that it is unable to generally
pay its debts as they become due;
(h) the institution, by the Defaulting Party, of a general assignment for the
benefit of its creditors; or
(i) the application for, consent to, or acquiescence to, by the Defaulting Party,
the appointment of a receiver, custodian, trustee, liquidator, or similar official
for all or a substantial portion of its assets."
(iv) Section 22.2(b) of the Master Agreement is amended by inserting in Section
22.2, "and is continuing" after "Event of Default occurs" in the first line thereof
and deleting the second sentence therein.
(v) Section 22.3 of the Master Agreement is amended by:
1. In Section 22.3(b), replacing the second sentence thereof with "The "Present
Value Rate" shall mean an annual rate equal to the "prime rate" as published
in the Wall Street Journal from to time plus 2%.";
2. In Section 22.3(c), deleting the third sentence thereof and replacing it with the
following: "If the Non -Defaulting Party's aggregate Gains exceed its aggregate
Losses and Costs, if any, resulting from the termination of this Agreement or a
Confirmation, the Termination Payment for all such Terminated Transactions
shall be zero, notwithstanding any provision in this Section or Agreement to
the contrary."
3. In Section 22.3(e), delete the entire provision (including subsections) and
replace it with the following: "[Intentionally omitted]"
4. In Section 22.3(f), delete the entire provision and replace it with the following:
"If the Defaulting Party disagrees with the calculation of the Termination
Payment and the Parties cannot otherwise resolve their differences, and
provided that Defaulting Party has paid the undisputed part of the Termination
Payment to the Non -Defaulting Party as provided under Section 22.3(c), and
that any amounts disputed by the Defaulting Party are disputed in good faith,
then the Defaulting Party may submit the calculation issue to Dispute
Resolution pursuant to Section 34."
(vi) In Section 24, delete the first sentence and replace it with the following:
"This Agreement and any Confirmation shall be governed by and construed in
accordance with the laws of the State of California, without regard to the
conflicts of laws rules thereof."
(vii) The netting provisions of Section 28, NETTING, of the Master Agreement shall
apply to the transaction covered by this Confirmation and the RA Agreement
16
as if Buyer and Seller had both executed Exhibit A, NETTING, to the Master
Agreement. Both Parties intend for the netting provisions of Exhibit A to the
Master Agreement to be effective on the Effective Date.
(viii) Section 30.1 of the Master Agreement is amended by inserting "or requested"
after the word "required" in Section 30.1(4), by deleting "or" immediately before
clause (7), and by adding the following at the end of the first sentence: "; or (8)
to the Party's and such Party's affiliates' lenders and potential lenders,
investors or potential investors, counsel, accountants, advisors and agents
who have a need to know such information and have agreed to keep such
terms confidential".
(ix) Section 31 of the Master Agreement is amended by deleting the second
sentence thereof.
(x) Subsections 34.1 and 34.2 of the Master Agreement are hereby deleted and
replaced with the following:
"34.1 INFORMAL DISPUTE RESOLUTION
IN THE EVENT OF ANY DISPUTE ARISING UNDER THIS
TRANSACTION, WITHIN TEN (10) DAYS FOLLOWING THE RECEIPT OF A
WRITTEN NOTICE FROM EITHER PARTY IDENTIFYING SUCH DISPUTE,
THE PARTIES SHALL MEET, NEGOTIATE AND ATTEMPT, IN GOOD
FAITH, TO RESOLVE THE DISPUTE QUICKLY, INFORMALLY AND
INEXPENSIVELY. IF THE PARTIES ARE UNABLE TO RESOLVE A
DISPUTE ARISING HEREUNDER WITHIN THIRTY (30) DAYS AFTER
RECEIPT OF SUCH NOTICE, THEN EITHER PARTY MAY SEEK ANY AND
ALL REMEDIES AVAILABLE TO IT AT LAW OR IN EQUITY, SUBJECT TO
THE LIMITATIONS SET FORTH IN THIS TRANSACTION."
"34.2 EXCLUSIVE JURISDICTION
EACH PARTY SUBMITS TO THE EXCLUSIVE JURISDICTION OF THE
STATE OR FEDERAL COURTS LOCATED IN SAN FRANCISCO,
CALIFORNIA, FOR ANY ACTION OR PROCEEDING RELATING TO THIS
AGREEMENT OR ANY TRANSACTION, AND EXPRESSLY WAIVES ANY
OBJECTION IT MAY HAVE TO SUCH JURISDICTION OR THE
CONVENIENCE OF SUCH FORUM."
(xi) The phrase "arbitration or" is hereby deleted from the first line of Section 34.4.
(xii) The following shall be inserted as a new Section 34.5; PROVIDED HOWEVER,
THAT THE FOLLOWING NEW SECTION 34.5 SHALL NOT LIMIT BUYER'S
RIGHT TO RECOVER FROM SELLER, OR SELLER'S OBLIGATION TO PAY
BUYER, ANY AND ALL AMOUNTS OWED PURSUANT TO THIS
CONFIRMATION, INCLUDING PENALTIES AS SPECIFIED THEREIN:
"34.5 LIMITATION OF DAMAGES. FOR BREACH OF ANY PROVISION
OF THIS CONFIRMATION AGREEMENT FOR WHICH AN EXPRESS
REMEDY OR MEASURE OF DAMAGES IS PROVIDED, THE EXPRESS
REMEDY OR MEASURE OF DAMAGES PROVIDED IS THE SOLE AND
17
EXCLUSIVE REMEDY UNDER THIS AGREEMENT AND ALL OTHER
REMEDIES FOR DAMAGES AT LAW OR IN EQUITY ARE WAIVED. IF NO
EXPRESS REMEDY OR MEASURE OF DAMAGES IS PROVIDED IN THIS
AGREEMENT FOR A PARTICULAR BREACH, LIABILITY FOR THE
BREACH IS LIMITED TO DIRECT DAMAGES ONLY, WHICH SHALL BE THE
SOLE AND EXCLUSIVE REMEDY UNDER THIS AGREEMENT FOR SUCH
BREACH, AND ALL OTHER REMEDIES FOR DAMAGES AT LAW OR IN
EQUITY ARE WAIVED. NEITHER PARTY IS LIABLE FOR ANY OTHER
TYPE OF DAMAGE, INCLUDING INCIDENTAL, PUNITIVE, EXEMPLARY,
CONSEQUENTIAL, SPECIAL OR INDIRECT DAMAGES OF ANY NATURE
(INCLUDING DAMAGES ASSOCIATED WITH LOST PROFITS, BUSINESS
INTERRUPTION AND LOSS OF GOODWILL) ARISING AT ANY TIME,
WHETHER IN TORT (INCLUDING THE SOLE OR CONTRIBUTORY
NEGLIGENCE OF EITHER PARTY OR ANY RELATED PERSON),
WARRANTY, STRICT LIABILITY, CONTRACT OR STATUTE, UNDER ANY
INDEMNITY PROVISION, OR OTHERWISE; PROVIDED, HOWEVER, THAT
THE FOREGOING SHALL NOT LIMIT EITHER PARTY'S RIGHT TO
RECOVER DAMAGES UNDER EXPRESS INDEMNITY PROVISIONS SET
FORTH IN THE CONFIRMATION.
(xiii) Section 41 "Witness" of the Master Agreement shall become Section 42 and
the following "Standard of Review" Section shall be substituted in its place:
"The Parties agree as follows:
Absent the agreement of all Parties to the proposed change, the standard of
review for changes to any section of this Agreement (including all Transactions
and/or Confirmations) specifying the rate(s) or other material economic terms
and conditions agreed to by the Parties herein, whether proposed by a Party,
a non-party or FERC acting sua sponte, shall be the "public interest" standard
of review set forth in United Gas Pipe Line Co. v. Mobile Gas Service Corp.,
350 U.S. 332 (1956) and Federal Power Commission v. Sierra Pacific Power
Co., 350 U.S. 348 (1956)( the "Mobile -Sierra" doctrine) and clarified in Morgan
Stanley Capital Group, Inc. v. Public Util. Dist. No. 1 of Snohomish 554 U.S.
527 (2008) and NRG Power Marketing LLC v. Maine Pub. Util. Comm'n, 558
U.S. 165 (2010).
2. The Parties, for themselves and their successors and assigns, (i) agree that
this "public interest" standard shall apply to any proposed changes in any other
documents, instruments or other agreements executed or entered into by the
Parties in connection with this Agreement and (ii) hereby expressly and
irrevocably waive any rights they can or may have to the application of any
other standard of review, including the "just and reasonable" standard."
(xiv) Section B-5 of WSPP Service Schedule B is hereby deleted in its entirety and
replaced with the following: "[Intentionally omitted]"
M
Definitions/
Interpretations: For purposes of the Confirmation, the following definitions and rules of
interpretations shall apply:
"Agreement" has the meaning specified in the introductory paragraph hereof.
"Confidential Information" means all oral and written information exchanged between the
Parties with respect to the subject matter of this Agreement. The following information does not
constitute Confidential Information for the purposes of this Agreement: (a) information that is or
becomes generally available to the public other than as a result of a disclosure by either Party in
violation of this Agreement; (b) information that was already known by either Party on a non -
confidential basis prior to this Agreement; and (c) information that becomes available to either
Party on a non -confidential basis from a source other than the other Party if such source was not
subject to any prohibition against disclosing the information to such Party.
"CAISO" means the California Independent System Operator Corporation or any successor entity
performing similar functions.
"CAISO Credit" means the Energy Price paid or charged by the CAISO for the energy scheduled
and delivered from the Project to the Delivery Point.
"CAISO Tariff" or "Tariff" means the tariff and protocol provisions of the CAISO, including the
rules, protocols, procedures and standards attached thereto, as it may be amended, modified,
supplemented or replaced (in whole or in part) from time to time.
"CAISO Balancing Authority" means, as the context requires, CAISO as "Balancing Authority"
or "CAISO Balancing Authority Area", as such terms are used in the CAISO Tariff.
"California Renewables Portfolio Standard" or "California RPS Program" or "RPS" means
the "California Renewables Portfolio Standard" program as codified at California Public Utilities
Code Section 399.11 et seq., as such provisions are amended or supplemented from time to time,
and jointly administered by the CEC, the CPUC and the California Air Resources Board, including
without limitation all applicable eligibility criteria and requirements thereof and implemented in a
manner consistent with the Enforcement Procedures for the Renewables Portfolio Standard for
Local Publicly Owned Electric Utilities, as adopted by the California Energy Commission on
December 22, 2020, and as may be amended from time to time.
"CEC" or "Energy Commission" or "California Energy Commission" means the California
Energy Commission, or any successor entity.
"CPUC" means the California Public Utilities Commission, or any successor entity.
"Change in Law" means any addition, amendment, decision, ruling, order, or binding
interpretation by or of a Governmental Body or other third party having jurisdiction or authority, to
or regarding any laws, rules, regulations, orders, or judicial precedent, that applies to the
California RPS Program, that is enacted, issued or becomes legally effective after the Effective
Date and materially affects the California RPS Program or compliance of the Product with the
California RPS Program.
"Credit Rating" means, with respect (i) to Seller, the current rating then assigned by Moody's,
S&P, Kroll, or Fitch, to Seller's senior unsecured long-term debt obligations (not supported by
insurance provider enhancements), or if Seller does not have a rating for its senior unsecured
19
long-term debt, then the current general corporate credit rating or long-term issuer rating assigned
by Moody's, S&P, Kroll, or Fitch. In the event Seller has multiple ratings, the lowest rating shall
prevail, and (ii) to Buyer, the current rating then assigned by Moody's, S&P, Kroll, or Fitch, to
Buyer's Hydroelectric Project 1 Revenue Bonds (not supported by insurance provider
enhancements), or if Buyer does not have a rating for its project bonds or revenue bonds, then
the current general credit rating or long-term issuer rating assigned by Moody's, S&P, Kroll, or
Fitch. In the event Buyer has multiple ratings, the lowest rating shall prevail.
"Delivered Energy" means renewable energy generated and metered from the Project with
associated Environmental Attributes that is delivered to Buyer at the Delivery Point in accordance
with this Confirmation.
"Downgrade Event" shall have the following meaning:
For Seller, it shall be a Downgrade Event for Seller only if the Credit Rating of Seller falls
below BBB- from S&P, Fitch or Kroll, or Baa3 from Moody's, or if Seller ceases to be rated
by either S&P, Fitch, Moody's or Kroll. Seller shall provide notice to Buyer no later than
five (5) Business Days after the occurrence of any Downgrade Event.
For Buyer, it shall be a Downgrade Event for Buyer only if (i) Buyer's underlying Credit
Rating, determined without reference to third party credit enhancement, on its utility
revenue bond ("Debt") by S&P, Moody's, and Fitch is respectively below BBB- or Baa3,
and Buyer fails to maintain Days of Cash on Hand. For the purposes of this Agreement,
"Days of Cash on Hand" means, with respect to Buyer, the required security deposit under
the Third Phase Agreement, which shall be no less than the amount of Buyer's estimated
full payments for three (3) months of Product under both this Agreement and the RA
Agreement, and (ii) Buyer no longer has legal right to demand that its members adjust
electric rates, or take other measures to increase revenues, as necessary to fully recover
the total costs Buyer is obligated for hereunder. Buyer shall provide notice to Seller no
later than five (5) Business Days after the occurrence of any Downgrade Event.
"Eligible Renewable Resource" or "ERR" has the meaning as defined in this confirmation.
"Emission Performance Standard" or "EPS" means the requirement set -forth in California
Code of Regulations (CCR) Title 20, Chapter 11, Article 1. Section 2900 et seq.
"Energy Price" means, for each MWh of energy scheduled and delivered from the Project to the
Delivery Point, the applicable Locational Marginal Price, as defined in the Tariff and published by
the CAISO, at the Delivery Point where CAISO models the physical injection of such Project
energy.
"Environmental Attribute Price" means: $14.00/MWh for each MWh of Resource Contingent
Bundled REC delivered to Buyer.
"Environmental Attributes" or "Green Attributes" means any and all credits, benefits,
emissions reductions, offsets, and allowances, howsoever entitled, attributable to the generation
from the Project, and its avoided emission of pollutants. Environmental 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
20
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; (3) the reporting rights to these avoided emissions,
such as Renewable Energy Credits or 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 and Renewable Energy Credits are accumulated on a
MWh basis and one Green Tag or Renewable Energy Credit represents the Environmental
Attributes or Green Attributes associated with one (1) MWh of Energy. Environmental Attributes
or Green Attributes do not include (i) any energy, capacity, reliability or other power attributes
from the Project, (ii) production tax credits associated with the construction or operation of the
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 Seller 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 the
Project for compliance with local, state, or federal operating and/or air quality permits;
"Generally Accepted Utility Practice" means a practice established by the Western Electricity
Coordinating Council ("WECC") or any successor regional reliability council, as such practice may
be revised from time to time, or if no practice is so established, means a practice otherwise
generally accepted in the WECC region.
"Green Tag" and "Green Tag Reporting Rights" have the meanings set forth in the definition
of "Green Attributes", and for the purposes of this Transaction.
"Green Tag Purchaser" means Buyer.
"Governmental Body" means (i) any federal, state, local, municipal or other government; (ii) any
governmental, regulatory or administrative agency, commission or other authority lawfully
exercising or entitled to exercise any administrative, executive, judicial, legislative, police,
regulatory or taxing authority or power; and (iii) any court or governmental tribunal.
"Inter -SC Trade" is defined in the Tariff.
"Investment Grade Rating" means a rating of BBB- or better from S&P, Fitch or Kroll, or a rating
of Baa3 or better from Moody's.
"Locational Marginal Price" is defined in the Tariff.
"MW" means megawatt in alternating current, or ac.
"MWh" mean megawatt -hours.
"NERC" means the North American Electric Reliability Corporation.
"NP15 Existing Zone Generation Trading Hub" or "NP15 EZ Gen Hub" is defined in the Tariff.
"Participating Member" means a member of Buyer that is signatory to the Third Phase
Agreement.
21
"Point of Interconnection" is defined in the Tariff
"Qualified Issuer" means a person acceptable to Buyer or Seller and that is a United States
financial institution, and that has a current long-term credit rating (corporate or long-term senior
unsecured debt) of (a) "A2" or higher by Moody's and "A-" or higher by S&P, if such Person is
rated by both Moody's and S&P or (b) "Aa2" or higher by Moody's, or "AX or higher by S&P if
such person is rated by only S&P or Moody's.
"Qualified Reporting Entity" or "QRE" means an organization providing renewable energy data
to WREGIS for registered generating units. QREs shall meet the Qualified Reporting Entity
Guidelines established in the WREGIS Operating Rules.
"RA Agreement" is executed by the Parties concurrently with the execution of this Confirmation.
"Renewable Energy Credit" or "REC" means a renewable energy credit as defined by and in
accordance with Section 399.12(h) of the California Public Utilities Code, including the right to
claim title to Environmental Attributes attributable to the generation of electric energy from an
Eligible Renewable Energy Resource.
"RPS ID" or "CEC RPS ID" means the "California Energy Commission RPS certification
number", the "identification number" and/or the "RPS ID", as such terms are used by the CEC to
describe the identification number for an ERR that has been certified (or will be certified for the
period of deliveries) as such by the CEC for the purposes of the California RPS Program. The
RPS ID for each Project is set out beside the applicable facility under the column "CEC RPS ID"
in the table attached hereto as Exhibit A.
"Scheduling Coordinator" is defined in the Tariff.
"Third Phase Agreement" means the agreement between buyer and the Participating Members
that sets forth the terms and conditions under which Buyer is authorized to enter into this
Agreement on behalf of the Participating Members.
"WREGIS" means Western Renewable Energy Generating Information System or any successor
renewable energy tracking system or program.
"WREGIS Certificate" has the same meaning as "Certificate" as defined by WREGIS in the
WREGIS Operating Rules and are designated by applicable law as eligible for complying with the
California RPS Program and for evidencing the Environmental Attributes associated with the
Product.
"WREGIS Operating Rules" means the operating rules and requirements adopted by WREGIS,
as amended from time to time or successor rules and requirements.
"WREGIS Timelines" means the timeline for WREGIS Certificates creation by WREGIS in
accordance with WREGIS Operating Rules as applied by WREGIS.
[SIGNATURE PAGE FOLLOWS]
22
ACKNOWLEDGED AND AGREED TO AS OF THE EFFECTIVE DATE:
Geysers Power Company, LLC
By:
Name: Gevan Reeves
Northern California Power Agency
By: � i �—,
Name: Randy S. Howard
Title: Vice President and Authorized Signatory Title: General Manager
Attest:
Assistant Secretary of the Commission
Approved as to Form:
Pane E. Luckhardt, General Counsel
23
ACKNOWLEDGED AND AGREED TO AS OF THE EFFECTIVE DATE:
Geysers Power C na LLC
RA By:
Name: Gevan Reeves
Title: Vice President and Authorized Signatory
23
Northern California Power Agency
By:
Name: Randy S. Howard
Title: General Manager
Attest:
Assistant Secretary of the Commission
Approved as to Form:
Jane E. Luckhardt, General Counsel
SCHEDULE1
AMOUNT OF REQUIRED SECURITY
Period
Amount
1/1/2025 - 12/31/2025
$2,500,000.00
1/1/2026 - 12/31/2026
$2,500,000.00
1/1/2027 - 12/31/2027
$5,000,000.00
1/1/2028 - 12/31/2028
$5,000,000.00
1/1/2029 - 12/31/2029
$5,000,000.00
1/1/2030 - 12/31/2030
$5,000,000.00
1/1/2031 - 12/31/2031
$5,000,000.00
1/1/2032 - 12/31/2032
$5,000,000.00
1/1/2033 - 12/31/2033
$5,000,000.00
1/1/2034 - 12/31/2034
$5,000,000.00
1/1/2035 - 12/31/2035
$5,000,000.00
1/1/2036 - 12/31/2036
$5,000,000.00
EXHIBIT A
Project Information
Name of Facility
Single Line Facility Name
CAISO Resource ID CEC RPS ID WREGIS GU ID
Aidlin Power Plant
AIDLIN P.P. (CPN -1)
ADLIN_1_UNITS
60115A
W484
Sonoma Power Plant
SONOMA P.P. (CPN -3)
SMUDGO_i_UNIT 1
60010A
W127
Geysers Unit 5&6
MC CABE P.P. (CPN 5&6)
GYS5X6 7 UNITS
60002A
W117
Geysers Unit 7&8
RIDGE LINE P.P. (CPN 7&8)
GYS7X8_7_UNITS
60003A
W118
Geysers Unit 11
EAGLE ROCK P.P. (CPN -11)
GEYS11_7_UNIT11
60025A
W119
Geysers Unit 12
COBB CREEK PP (CPN -12)
GEYS12_7_UNIT12
60004A
W120
Geysers Unit 13
BIG GEYSERS PP (CPN -13)
GEYS13_7_UNIT13
60005A
W121
Geysers Unit 14
SULPHUR SPRINGS PP (CPN -14)
GEYS14_7_UNIT14
60026A
W122
Geysers Unit 16
QUICKSILVER PP (CPN -16)
GEYS16_7_UNIT16
60006A
W123
Geysers Unit 17
LAKE VIEW P.P. (CPN -17)
GEYS17_7_UNIT17
60007A
W124
Geysers Unit 18
SOCRATES P.P. (CPN -18)
GEYS18 7 UNIT18
60008A
W125
Calistoga Power Plant
COLISTOGA P.P. (CPN -19)
SANTFG_7_UNITS
60117A
W486
Geysers Unit 20
GRANT P.P. (CPN -20)
GEYS20 7 UNIT20
60009A
W126
EXHIBIT B
[ISSUER LETTERHEAD]
DATE: [DATE]
WE HEREBY ISSUE OUR IRREVOCABLE NON -TRANSFERABLE STANDBY LETTER OF CREDIT NO
[NUMBER]
ISSUING BANK:
[ISSUER]
[ADDRESS]
[PHONE NUMBER]
[FAX NUMBER]
BENEFICIARY:
NORTHERN CALIFORNIA POWER AGENCY
[INSERT]
ROSEVILLE, CA 95747
ATTN: [INSERT]
("BENEFICIARY')
/_1»I[o7_1011
[INSERT]
AMOUNT: USD $[AMOUNT] (AMOUNT XX/100 UNITED STATES DOLLARS)
EXPIRATION DATE: [DATE]
WE HEREBY OPEN OUR IRREVOCABLE NON -TRANSFERABLE STANDBY LETTER OF CREDIT
("LETTER OF CREDIT") IN FAVOR OF THE NORTHERN CALIFORNIA POWER AGENCY AND FOR
THE ACCOUNT OF THE ABOVE REFERENCED APPLICANT IN THE AGGREGATE AMOUNT OF USD
[AMOUNT] (AMOUNT), WHICH IS AVAILABLE BY PAYMENT WITH US WHEN ACCOMPANIED BY
THE FOLLOWING DOCUMENTS:
1. A DRAFT AT SIGHT DRAWN ON [ISSUER], DULY ENDORSED ON ITS REVERSE SIDE
THEREOF BY THE BENEFICIARY, SPECIFICALLY REFERENCING THIS LETTER OF CREDIT
NUMBER, AS EXEMPLIFIED BY ATTACHMENT A.
2. THE ORIGINAL LETTER OF CREDIT AND ANY AMENDMENTS ATTACHED THERETO,
3. A COPY OF THE INVOICE MARKED UNPAID; AND
4. A STATEMENT ISSUED ON THE LETTERHEAD OF AND SIGNED BY THE BENEFICIARY
STATING THE FOLLOWING: "THE APPLICANT HAS NOT MADE PAYMENT ON INVOICE
NUMBER (INSERT INVOICE NUMBER) PER THE RELEVANT CONTRACTS. WE
THEREFORE DEMAND PAYMENT IN THE AMOUNT OF (INSERT DOLLAR AMOUNT) AS
SAME IS DUE AND OWING."
(CONTINUED ON PAGE 2)
(PAGE 2 OF LETTER OF CREDIT NO: [INSERT NUMBER])
WE ARE ADVISED BY THE APPLICANT THAT THIS LETTER OF CREDIT IS ISSUED IN
CONNECTION WITH THE TRANSACTION BETWEEN THE NORHTERN CALIFORNIA POWER
AGENCY AND [INSERT] DATED [INSERT DATE] UNDER THE Master AGREEMENT AS AMENDED
FROM TIME TO TIME DATED [INSERT MOST CURRENT Master AGREEMENT DATE]
("AGREEMENT").
INVOICE(S) IN EXCESS OF THE AMOUNT AVAILABLE UNDER THIS LETTER OF CREDIT ARE
ACCEPTABLE; HOWEVER, DRAWINGS UNDER THIS LETTER OF CREDIT MAY NOT EXCEED
AMOUNT AVAILABLE.
IF A COMPLYING PRESENTATION OF DRAW DOCUMENTS IS MADE PRIOR TO 11:00 AM
(EASTERN STANDARD TIME) ON A BUSINESS DAY, THEN WE SHALL, PRIOR TO THE CLOSE OF
BUSINESS ON THE FIRST FOLLOWING BUSINESS DAY, MAKE PAYMENT IN IMMEDIATELY
AVAILABLE FUNDS. IF A COMPLYING PRESENTATION OF DRAW DOCUMENTS IS MADE AT OR
AFTER 11:00 AM (EASTERN STANDARD TIME) ON A BUSINESS DAY, THEN WE SHALL, PRIOR TO
THE CLOSE OF BUSINESS ON THE SECOND FOLLOWING BUSINESS DAY, MAKE PAYMENT IN
IMMEDIATELY AVAILABLE FUNDS.
PARTIAL DRAWINGS AND MULTIPLE PRESENTATIONS ARE PERMITTED.
ALL CHARGES OF THE ISSUER ARE FOR THE ACCOUNT OF THE APPLICANT.
THIS LETTER OF CREDIT SETS FORTH IN FULL THE TERMS OF OUR UNDERTAKING. THIS
UNDERTAKING SHALL NOT IN ANY WAY BE MODIFIED, AMENDED, AMPLIFIED, OR
INCORPORATED BY REFERENCE TO ANY DOCUMENT, CONTRACT, OR AGREEMENT
REFERENCED TO HEREIN.
WE HEREBY AGREE WITH YOU THAT DRAFT(S) DRAWN UNDER AND IN COMPLIANCE WITH THE
TERMS AND CONDITIONS OF THIS CREDIT SHALL BE DULY HONORED IF PRESENTED TOGETHER
WITH DOCUMENT(S) AS SPECIFIED AT OUR OFFICES AT [INSERT ISSUER NAME AND ADDRESS]
ON OR BEFORE THE ABOVE STATED EXPIRY DATE, OR ANY EXTENDED EXPIRY DATE IF
APPLICABLE. DRAFT(S) DRAWN UNDER THIS CREDIT MUST SPECIFICALLY REFERENCE OUR
LETTER OF CREDIT NUMBER.
FACSIMILE OF THE DRAW DOCUMENTS IS ACCEPTABLE TO [INSERT FAX NUMBER]. IF
PRESENTATION IS MADE BY FACSIMILE, PROMPT PHONE NOTIFICATION MUST BE GIVEN TO
[INSERT PHONE NUMBER], PROVIDED THAT BENEFICIARY'S FAILURE TO MAKE SUCH FOLLOW
UP TELEPHONE CALL SHALL NOT INVALIDATE THE FACSIMILE DRAWING. THE FACSIMILE
PRESENTATION SHALL BE DEEMED THE ORIGINAL PRESENTATION. IN THE EVENT OF A FULL OR
FINAL DRAWING, THE ORIGINAL STANDBY LETTER OF CREDIT MUST BE RETURNED TO THE
ISSUER BY OVERNIGHT COURIER AT THE TIME OF THE FACSIMILE PRESENTATION.
THIS LETTER OF CREDIT IS SUBJECT OT THE INTERNATIONAL STANDBY PRACTICES 1998,
INTERNATIONAL CHAMBER OF COMMERCE PUBLICATION NO. 590 ("ISP 98").
VERY TRULY YOURS,
[ISSUER]
NAME
TITLE
AUTHORIZED SIGNATURE
ATTACHMENT A
Drawing Certificate
TO [ISSUING BANK NAME]
IRREVOCABLE NON -TRANSFERABLE STANDBY LETTER OF CREDIT
[e
DRAWING CERTIFICATE
Bank Address
Subject: Irrevocable Non -transferable Standby Letter of Credit
Reference Number:
The undersigned , an authorized representative of Northern
California Power Agency (the "Beneficiary"), hereby certifies to [Issuing Bank Name] (the
"Bank"), and (the "Applicant"), with reference to Irrevocable
Nontransferable Standby Letter of Credit No. ( ), dated
(the "Letter of Credit"), issued by the Bank in favor of the Beneficiary, as follows as of
the date hereof:
The Beneficiary is entitled to draw under the Letter of Credit an amount equal to
$ , for the following reason(s) [check applicable provision]:
[ ]A. An Event of Default, as defined in that certain Transaction between Applicant and
Beneficiary, dated as of [Date of Execution) under the Confirmation Agreement
between the Northern California Power Agency and [INSERT] dated [INSERT
DATEI under the Master Agreement as amended from time to time dated [August
12, 20211 (the "Agreement"), with respect to the Applicant has occurred and is
continuing.
[ ]B. An Early Termination Date (as defined in the Agreement) has occurred or been
designated as a result of an Event of Default (as defined in the Agreement) with
respect to the Applicant for which there exist any unsatisfied payment
obligations.
[ ]C. The occurrence of an Event of Deficient Product Deliveries.
[ ]D. The Bank has heretofore provided written notice to the Beneficiary of the Bank's
intent not to renew the Letter of Credit following the present Expiration Date
thereof ("Notice of Non -renewal"), and Applicant has failed to provide the
Beneficiary with a replacement letter of credit satisfactory to Beneficiary in its
sole discretion within thirty (30) days following the date of the Notice of Non-
renewal.
[ ]E. The Beneficiary has not been paid any or all of the Applicant's payment
obligations now due and payable under the Confirmation or Agreement.
2. Based upon the foregoing, the Beneficiary hereby makes demand under the Letter of
Credit for payment of U.S. DOLLARS AND /100ths (U.S.$ ),
which amount does not exceed (i) the amount set forth in paragraph 1 above, and (ii) the
Available Amount under the Letter of Credit as of the date hereof.
3. Funds paid pursuant to the provisions of the Letter of Credit shall be wire transferred to
the Beneficiary in accordance with the following instructions:
Unless otherwise provided herein, capitalized terms which are used and not defined herein shall
have the meaning given each such term in the Letter of Credit.
IN WITNESS WHEREOF, this Certificate has been duly executed and delivered on behalf of the
Beneficiary by its authorized representative as of this day of , 20
Beneficiary: NORTHERN CALIFORNIA POWER
AGENCY
M
Name:
Title:
iv
RESOLUTION NO. 2023-36
A RESOLUTION OF THE LODI CITY COUNCIL AUTHORIZING THE
CITY MANAGER TO EXECUTE A THIRD PHASE AGREEMENT WITH
NORTHERN CALIFORNIA POWER AGENCY FOR PURCHASE
AGREEMENTS WITH GEYSERS POWER COMPANY, LLC
WHEREAS, the City of Lodi (Lodi) is a signatory to the Joint Powers Agreement (JPA)
which created the Northern California Power Agency (NCPA) and therefore is a member; and
WHEREAS, Lodi and other NCPA members have executed the Amended and Restated
Facilities Agreement which establishes the framework under which project agreements are
created for the development, design, financing, construction, and operation of specific NCPA
projects; and
WHEREAS, in 2020, subsequently amended in 2022, NCPA, acting on behalf of
members, conducted a competitive solicitation to identify and select cost-effective resources to
support member obligations as it relates to renewable energy resources; and
WHEREAS, Geysers Power Company, LLC (Geysers) submitted a proposal to NCPA to
sell output from multiple geothermal power plants located in Sonoma and Lake Counties; and
WHEREAS, Lodi and other members desire NCPA to enter into Purchase Agreements
(Agreements) with Geysers for the purchase of resource adequacy capacity and renewable
energy products from these geothermal power plants; and
WHEREAS, under the terms of the Agreements, NCPA will purchase, on behalf of
member participants including Lodi, the electrical energy output, resource adequacy capacity,
renewable energy credits, and all other environmental attributes from Geysers for 5 megawatts
(MW) beginning January 1, 2025, increasing to 10 MW beginning January 1, 2027 continuing
through December 31, 2036; and
WHEREAS, the output under the Agreements is guaranteed to qualify as Portfolio Content
Category 1 under California Renewables Portfolio Standard requirements; and
WHEREAS, in order for NCPA to move forward on behalf of participating members, a
Third Phase Agreement is needed to enable NCPA to enter into the Agreements with Geysers on
behalf of the participants; and
WHEREAS, the Third Phase Agreement facilitates the transfer of all costs, obligations,
and benefits associated with the Agreements from NCPA to the signatories to the Third Phase
Agreement in proportion to each signatory's Project Participation Percentage for the life of the
Agreements; and
WHEREAS, on the effective date of the Third Phase Agreement, the City of Santa Clara
(the initial participant) will hold the full Project Participation Percentage; however Lodi will exercise
its right to accept a transfer of 5 MW in 2025 and 2026 respectively and 10 MW each year
thereafter through 2036, thereby becoming a project participant; and
WHEREAS, this activity would not result in a direct or reasonably foreseeable indirect
change in the physical environment and is therefore, not a "project" for purposes of Section 21065
of the California Environmental Quality Act thus no environmental review is necessary; and
WHEREAS, on January 26, 2023, the Risk Oversight Committee received a report on the
Geysers Geothermal Project and recommended approval of the Third Phase Agreement with
NCPA.
NOW, THEREFORE, BE IT RESOLVED that the Lodi City Council does hereby authorize
the City Manager to execute a Third Phase Agreement with the Northern California Power Agency
for Purchase Agreements with Geysers Power Company, LLC; and
BE IT FURTHER RESOLVED, pursuant to Section 6.3q of the City Council Protocol
Manual (adopted 11/6/19, Resolution No. 2019-223), the City Attorney is hereby authorized to
make minor revisions to the above -referenced document(s) that do not alter the compensation or
term, and to make clerical corrections as necessary.
Dated: February 15, 2023
------------------------------------------------------------------------
------------------------------------------------------------------------
I hereby certify that Resolution No. 2023-36 was passed and adopted by the City Council
of the City of Lodi in a regular meeting held on February 15, 2023 by the following vote:
AYES: COUNCIL MEMBERS — Bregman, Craig, Khan, Nakanishi, and
Mayor Hothi
NOES: COUNCIL MEMBERS — None
ABSENT: COUNCIL MEMBERS — None
ABSTAIN- COUNCIL MEMBERS — None
vwaAl�
OLIVIA NASHED
City Clerk
2023-36