Deliveries and Quantity. (a) For each Designated System that has been Energized, the Delivery of at least one (1) REC from such Designated System is expected to occur to the Buyer’s PJM-EIS GATS account or M-RETS account, as applicable, within 90 calendar days of when such Designated System was Energized if the Actual Nameplate Capacity of such Designated System is greater than 5kW or within 180 calendar days of when the Designated System was Energized if the Actual Nameplate Capacity of such Designated System is equal to or less than 5kW. For each Designated System that fails to Deliver at least (1) one REC from such Designated System by the applicable deadline, Seller must provide to Buyer and the IPA or its designee, with respect to such Designated System, a written notice within sixty (60) days of the applicable deadline to Deliver at least one (1) REC confirming that there are no technical issues, with respect to such Designated System, known to Seller that would impede the generation, issuance and Delivery of RECs from such Designated System or that such technical issues have been resolved by Seller. In the event that Seller fails to provide such written notice within sixty (60) days of the applicable deadline to Deliver at least one (1) REC, then the number of RECs associated with such Designated System shall be deemed removed from this REC Contract and Buyer shall be entitled to payment by Seller in the amount of the greater of: (i) the Collateral Requirement for such Designated System or (ii) one hundred percent (100%) of the total payments Seller has received from Buyer associated with RECs from such Designated System. (b) For each Designated System that has been Energized, all RECs designated to be Delivered pursuant to the Standing Order associated with such Designated System shall be Delivered to Buyer commencing from the date such Standing Order is established through the end of the Delivery Term of such Designated System regardless of whether the total payment made by Buyer to Seller for RECs from such Designated System is commensurate with the actual number of RECs Delivered from such Designated System. (c) For each Designated System that has been Energized, a REC delivery schedule is provided in Schedule B to the Product Order applicable to such Designated System that contains the expected number of RECs to be Delivered through the end of the Delivery Term where the number of RECs expected to be Delivered in each Delivery Year is based on the Designated System Contract Maximum REC Quantity and a degradation factor of half of one percent (0.5%) annually, and rounded down to the nearest whole REC in each Delivery Year. The REC quantities expected to be Delivered from such Designated System in a Delivery Year shall be the “Delivery Year Expected REC Quantity” for such Delivery Year. For avoidance of doubt, with respect to a Designated System, the Delivery Year Expected REC Quantities in the delivery schedule are determined at the time of Energization and not when the Delivery Term starts. As such, for purposes of calculating the Delivery Year Expected REC Quantity for each Delivery Year, the Delivery Year in which the date of Energization occurred shall be the first Delivery Year for which a Delivery Year Expected REC Quantity is calculated and the Delivery Year Expected REC Quantity for such first Delivery Year shall reflect an annualized number based on allocating the Designated System Contract Maximum REC Quantity across 15 years using a degradation factor of half of one percent (0.5%) annually. If the Delivery Term extends beyond a 15-Delivery Year schedule starting with that first Delivery Year, then each subsequent Delivery Year Expected REC Quantity subsequent to the 15th Delivery Year shall reflect a quantity that provides for a degradation factor of half of one percent (0.5%) from the prior Delivery Year Expected REC Quantity (a sample delivery schedule is provided in Exhibit F). (d) Once annually on or prior to November 15 following a Delivery Year, the IPA or its designee shall review the performance of the REC deliveries made during such Delivery Year and determine the amount of Aggregate Drawdown Payment due as follows: (i) For each Designated System that has been Energized and three (3) full Delivery Years has occurred since the start of the Delivery Term of such Designated System, the IPA or its designee shall calculate, with respect to a Delivery Year, a Delivery Year REC Performance for such Delivery Year (an example Delivery Year REC Performance calculation is provided in Exhibit G); (ii) With respect to a Designated System that has been Energized and three (3) full Delivery Years has occurred since the start of the Delivery Term of such Designated System, in the event that the Delivery Year REC Performance is greater than the applicable Delivery Year Expected REC Quantity, the difference in the number of RECs shall be the “Delivery Year Surplus Amount” and each REC included in the Delivery Year Surplus Amount shall be a “Surplus REC”; (iii) With respect to a Designated System that has been Energized and three (3) full Delivery Years has occurred since the start of the Delivery Term of such Designated System, in the event that the Delivery Year REC Performance is less than the Delivery Year Expected REC Quantity, the difference in the number of RECs shall be the “Delivery Year Shortfall Amount”; (iv) For each Designated System that has a Delivery Year Shortfall Amount, starting with the Designated System with the lowest Contract Price, Surplus RECs from the Surplus REC Account shall be reduced and allocated to meet such Delivery Year Shortfall Amount, REC for REC. If there are insufficient Surplus RECs to meet the Delivery Year Shortfall Amount, then the number of RECs calculated as the difference between the Delivery Year Shortfall Amount and the sum of such Surplus RECs being applied to meet the Delivery Year Shortfall Amount is the “Drawdown REC Quantity”, and the multiplicative product of the Drawdown REC Quantity and the Contract Price of such Designated System is the “Drawdown Payment”; and (v) At the end of the foregoing process: (1) Buyer shall draw on Seller’s Performance Assurance in the amount of the Aggregate Drawdown Payment. Seller shall be required to replenish Seller’s Performance Assurance in accordance with Section 4.3 of the Master REC Agreement. If Seller’s Performance Assurance is less than the Aggregate Drawdown Payment, then Seller shall pay Buyer the difference within fifteen (15) Business Days of notice by Buyer. Failure by Seller to pay Buyer shall be an Event of Default subject to the Termination remedies under this REC Contract Notwithstanding the foregoing, if this is not the last Delivery Year under this REC Contract and the amount of the Aggregate Drawdown Payment is less than $5,000, then Buyer shall not draw on Seller’s Performance Assurance, but will track such amount and add such amount to the Aggregate Drawdown Payment for the subsequent Delivery Year or Delivery Years until the earlier of: the last Delivery Year or such time when the Aggregate Drawdown Payment is at least $5,000; (2) For purposes of calculating the Delivery Year REC Performance in future Delivery Years, each Designated System that has a Delivery Year Shortfall Amount for which such Delivery Year Shortfall Amount is covered by Surplus REC(s) and/or for which a payment from Seller or from Seller’s Performance Assurance has been applied to the Drawdown REC Quantity, such Designated System is deemed to have Delivered REC quantities equal to the Delivery Year Expected REC Quantity in such Delivery Year. (e) If a Designated System is a Community Renewable Energy Generation Project, such Designated System must maintain at least the Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed as provided in the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet throughout the remainder of the Delivery Term after the issuance of such Community Solar Quarterly Report. Failure to maintain the Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed as provided in the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet in a Delivery Year shall result in payment to Buyer from Seller of a monetary amount, determined by the IPA or its designee, and Buyer may draw on Seller’s Performance Assurance for this purpose. For each Delivery Year after the issuance of the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet, the subscription percentage and Community Solar Subscription Mix will each be calculated as a daily average, then averaged over the Delivery Year, based on actual subscription start and end dates entered in the REC Annual Report. The draw on Seller’s Performance Assurance will be calculated as the difference between (a) the contracted payment for that Delivery Year and (b) the amount that would have been paid given the realized Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed, if (a) exceeds (b). This amount will be calculated in arrears for only the immediately preceding Delivery Year covered by the REC Annual Report. If the Designated System regains a Community Solar Subscription mix and subscription percentage at or above their contracted amount in subsequent years, a drawdown will not occur in those years; however, overperformance in a Delivery Year will not be banked or applied to past Delivery Years. Designated Systems with subscription levels above 90% of Actual Nameplate Capacity on a kW capacity basis for a Delivery Year will not be subject to a draw on Seller’s Performance Assurance for that Delivery Year on the basis of subscription percentage. This calculation will only occur after the final Contract Price and quantity of RECs due payment are determined per section 5(e)(iv)(D) of the Cover Sheet and will be based on that final Contract Price and quantity which is determined by the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet. (f) During the Delivery Term, Seller may determine that a Designated System is not performing at the level expected. In such case, Seller may submit a request to Buyer and the IPA (or its designee) to have the Delivery obligations of such Designated System reduced, and if the request is accepted by Buyer, such request shall be in exchange for the return by Seller to Buyer of an agreed upon payment adjustment if payment has been made by Buyer for RECs from such Designated System. Such request shall include pertinent information related to the payment adjustment as well as requested changes to future Delivery Year Expected REC Quantity and Contract Nameplate Capacity. Any such request shall be deemed approved upon Buyer’s receipt of such agreed upon payment adjustment, and information regarding the receipt of and the calculation of the agreed upon payment adjustment shall be communicated to the IPA and its designee. Any such changes in the delivery schedule and adjustments made to future Delivery Year Expected REC Quantity and Contract Nameplate Capacity shall be documented in an amended Schedule B to the Product Order applicable to such Designated System issued by the IPA or its designee to Buyer and Seller. (g) Surplus RECs are virtually tracked in the Surplus REC Account and shall remain, except as provided in Section 9.2 of the Master REC Agreement, in such account until a reduction in such Surplus RECs is recorded by the IPA or its designee to meet a Delivery Year Shortfall Amount. (h) Upon the conclusion of the annual review process pursuant to Section 6(d) above for the last Delivery Year under this REC Contract, if (i) there are Surplus RECs remaining in the Surplus REC Account and (ii) an Aggregate Drawdown Payment has occurred during the Term of this REC Contract, then the IPA or its designee shall calculate a monetary refund adjustment due to Seller from Buyer. Buyer shall credit Seller for each Surplus REC that can be applied to a REC associated with a Drawdown Payment. For purpose of calculating the refund, Surplus RECs from the Surplus REC Account shall be reduced and applied to the RECs that are associated with a Drawdown Payment, starting with the REC with the lowest Contract Price, REC for REC. The monetary refund adjustment shall be paid from Buyer to Seller by December 31 following the conclusion of the last annual review process. For avoidance of doubt, no payment shall be made for any Surplus RECs that remain in the Surplus REC Account after the refund adjustment is calculated.
Appears in 3 contracts
Sources: Renewable Energy Credit Agreement, Renewable Energy Credit Agreement, Renewable Energy Credit Agreement
Deliveries and Quantity. (a) All RECs Delivered shall be from the Project. Each Delivery shall be deemed a representation by Seller to Buyer that the Product meets the requirements specified in this Agreement.
(b) Seller shall be permitted to Deliver RECs from the Project for payment by Buyer or payment by Seller, as applicable, starting on the first day of the Delivery Term through the last day of the Delivery Term. For each Designated System avoidance of doubt, and notwithstanding the foregoing, only RECs associated with electricity generation that occurred within the Acceptable Vintage Period shall be eligible for payment in accordance with Section 2.1(c).
(c) As specified in Section 9.2(g), Seller’s failure to Deliver at least one (1) REC from the Project by Project by May 31, 2025 shall constitute an Event of Default unless (i) excused by Force Majeure or (ii) Seller has been Energizedposted Performance Assurance to satisfy the Increased Collateral Requirement by May 31, 2025; in the case of (ii), the deadline shall be deemed automatically extended to May 31, 2027 for the Delivery of at least one (1) REC from such Designated System is expected to occur to the Buyer’s PJM-EIS GATS account or M-RETS account, as applicable, within 90 calendar days Project. If the deadline for the Delivery of when such Designated System was Energized if the Actual Nameplate Capacity of such Designated System is greater than 5kW or within 180 calendar days of when the Designated System was Energized if the Actual Nameplate Capacity of such Designated System is equal to or less than 5kW. For each Designated System that fails to Deliver at least one (1) one REC from such Designated System by the applicable deadlineProject has been extended to May 31, Seller must provide 2027, Seller’s failure to Buyer and maintain Performance Assurance to satisfy the IPA Increased Collateral Requirement or its designee, with respect to such Designated System, a written notice within sixty (60) days of the applicable deadline to Deliver at least one (1) REC confirming that there are no technical issuesfrom the Project by such extended deadline shall constitute an Event of Default. Upon the occurrence of such Events of Default, with respect to such Designated System, known Buyer shall terminate this Agreement five (5) Business Days after written notice by Buyer to Seller that would impede unless Seller demonstrates, within such five (5) Business Day period and to the generationsatisfaction of Buyer in its sole discretion, issuance and Delivery of RECs from such Designated System or that such technical issues have been resolved by Seller. In the event that Seller fails has posted Seller’s Performance Assurance to provide such written notice within sixty (60) days satisfy the Increased Collateral Requirement required for an extension of the applicable deadline to May 31, 2027 or Seller has made such Delivery by the deadline or the extended deadline, as applicable. For such Events of Default, Buyer shall be entitled to payment by Seller (i) in the amount of the Collateral Requirement if there has been no extension; or (ii) in the amount of the Increased Collateral Requirement if an extension is granted and Seller fails to Deliver at least one (1) RECREC from the Project by the extended deadline of May 31, then the number of RECs associated with such Designated System 2027. The Parties acknowledge that (i) Buyer shall be deemed removed damaged by the failure of Seller to Deliver at least one (1) REC from the Project by the deadline or extended deadline, as applicable, (ii) it would be impracticable or extremely difficult to determine the actual damages resulting therefrom, (iii) the remedies specified herein are fair and reasonable and do not constitute a penalty, and (iv) the remedy specified in this REC Contract Section 4.1(c) shall be Buyer’s sole and exclusive remedy in such Events of Default and, for the avoidance doubt, neither Buyer nor Seller shall be entitled to payment by Seller in the amount of the greater of: (i) the Collateral Requirement for any Termination Payment under such Designated System or (ii) one hundred percent (100%) of the total payments Seller has received from Buyer associated with RECs from such Designated System.
(b) For each Designated System that has been Energized, all RECs designated to be Delivered pursuant to the Standing Order associated with such Designated System shall be Delivered to Buyer commencing from the date such Standing Order is established through the end of the Delivery Term of such Designated System regardless of whether the total payment made by Buyer to Seller for RECs from such Designated System is commensurate with the actual number of RECs Delivered from such Designated System.
(c) For each Designated System that has been Energized, a REC delivery schedule is provided in Schedule B to the Product Order applicable to such Designated System that contains the expected number of RECs to be Delivered through the end of the Delivery Term where the number of RECs expected to be Delivered in each Delivery Year is based on the Designated System Contract Maximum REC Quantity and a degradation factor of half of one percent (0.5%) annually, and rounded down to the nearest whole REC in each Delivery Year. The REC quantities expected to be Delivered from such Designated System in a Delivery Year shall be the “Delivery Year Expected REC Quantity” for such Delivery Year. For avoidance of doubt, with respect to a Designated System, the Delivery Year Expected REC Quantities in the delivery schedule are determined at the time of Energization and not when the Delivery Term starts. As such, for purposes of calculating the Delivery Year Expected REC Quantity for each Delivery Year, the Delivery Year in which the date of Energization occurred shall be the first Delivery Year for which a Delivery Year Expected REC Quantity is calculated and the Delivery Year Expected REC Quantity for such first Delivery Year shall reflect an annualized number based on allocating the Designated System Contract Maximum REC Quantity across 15 years using a degradation factor of half of one percent (0.5%) annually. If the Delivery Term extends beyond a 15-Delivery Year schedule starting with that first Delivery Year, then each subsequent Delivery Year Expected REC Quantity subsequent to the 15th Delivery Year shall reflect a quantity that provides for a degradation factor of half of one percent (0.5%) from the prior Delivery Year Expected REC Quantity (a sample delivery schedule is provided in Exhibit F).
(d) Once annually on or prior to November 15 following a Delivery Year, the IPA or its designee shall review the performance of the REC deliveries made during such Delivery Year and determine the amount of Aggregate Drawdown Payment due as follows:
(i) For each Designated System that has been Energized and three (3) full Delivery Years has occurred since the start of the Delivery Term of such Designated System, the IPA or its designee shall calculate, with respect to a Delivery Year, a Delivery Year REC Performance for such Delivery Year (an example Delivery Year REC Performance calculation is provided in Exhibit G);
(ii) With respect to a Designated System that has been Energized and three (3) full Delivery Years has occurred since the start of the Delivery Term of such Designated System, in the event that the Delivery Year REC Performance is greater than the applicable Delivery Year Expected REC Quantity, the difference in the number of RECs shall be the “Delivery Year Surplus Amount” and each REC included in the Delivery Year Surplus Amount shall be a “Surplus REC”;
(iii) With respect to a Designated System that has been Energized and three (3) full Delivery Years has occurred since the start of the Delivery Term of such Designated System, in the event that the Delivery Year REC Performance is less than the Delivery Year Expected REC Quantity, the difference in the number of RECs shall be the “Delivery Year Shortfall Amount”;
(iv) For each Designated System that has a Delivery Year Shortfall Amount, starting with the Designated System with the lowest Contract Price, Surplus RECs from the Surplus REC Account shall be reduced and allocated to meet such Delivery Year Shortfall Amount, REC for REC. If there are insufficient Surplus RECs to meet the Delivery Year Shortfall Amount, then the number of RECs calculated as the difference between the Delivery Year Shortfall Amount and the sum of such Surplus RECs being applied to meet the Delivery Year Shortfall Amount is the “Drawdown REC Quantity”, and the multiplicative product of the Drawdown REC Quantity and the Contract Price of such Designated System is the “Drawdown Payment”; and
(v) At the end of the foregoing process:
(1) Buyer shall draw on Seller’s Performance Assurance in the amount of the Aggregate Drawdown Payment. Seller shall be required to replenish Seller’s Performance Assurance in accordance with Section 4.3 of the Master REC Agreementcircumstance. If Seller’s Performance Assurance failure is less than the Aggregate Drawdown Payment, then Seller shall pay Buyer the difference within fifteen
(15) Business Days of notice excused by Buyer. Failure by Seller to pay Buyer shall be an Event of Default subject to the Termination remedies under this REC Contract Notwithstanding the foregoing, if this is not the last Delivery Year under this REC Contract Force Majeure and the amount of the Aggregate Drawdown Payment is less Suspension Period continues for more than $5,000seven hundred thirty (730) consecutive days, then Buyer may terminate this Agreement. Each thirty (30) day period within the Suspension Period shall not draw on Seller’s Performance Assurance, but will track extend the Acceptable Vintage Period by a Vintage month such amount and add such amount to the Aggregate Drawdown Payment for the subsequent Delivery Year or Delivery Years until the earlier of: the last Delivery Year or such time when the Aggregate Drawdown Payment is at least $5,000;
(2) For purposes of calculating the Delivery Year REC Performance in future Delivery Years, each Designated System that has a Delivery Year Shortfall Amount for which such Delivery Year Shortfall Amount is covered by Surplus REC(s) and/or for which a payment from Seller or from Seller’s Performance Assurance has been applied to the Drawdown REC Quantity, such Designated System is deemed to have Delivered REC quantities equal to the Delivery Year Expected REC Quantity in such Delivery Year.
(e) If a Designated System is a Community Renewable Energy Generation Project, such Designated System must maintain at least the Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed as provided in the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet throughout the remainder of the Delivery Term after the issuance of such Community Solar Quarterly Report. Failure to maintain the Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed as provided in the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet in a Delivery Year shall result in payment to Buyer from Seller of a monetary amount, determined by the IPA or its designee, and Buyer may draw on Seller’s Performance Assurance for this purpose. For each Delivery Year after the issuance of the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet, the subscription percentage and Community Solar Subscription Mix will each be calculated as a daily average, then averaged over the Delivery Year, based on actual subscription start and end dates entered in the REC Annual Report. The draw on Seller’s Performance Assurance will be calculated as the difference between (a) the contracted payment for that Delivery Year and (b) the amount that would have been paid given the realized Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed, if (a) exceeds (b). This amount will be calculated in arrears for only the immediately preceding Delivery Year covered by the REC Annual Report. If the Designated System regains a Community Solar Subscription mix and subscription percentage at or above their contracted amount in subsequent years, a drawdown will not occur in those years; however, overperformance in a Delivery Year will not be banked or applied to past Delivery Years. Designated Systems with subscription levels above 90% of Actual Nameplate Capacity on a kW capacity basis for a Delivery Year will not be subject to a draw on Seller’s Performance Assurance for that Delivery Year on the basis of subscription percentage. This calculation will only occur after the final Contract Price and quantity of RECs due payment are determined per section 5(e)(iv)(D) of the Cover Sheet and will be based on that final Contract Price and quantity which is determined by the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet.
(f) During the Delivery Term, Seller may determine that a Designated System is not performing at the level expected. In such case, Seller may submit a request to Buyer Suspension Period between one (1) and the IPA (or its designee) to have the Delivery obligations of such Designated System reduced, and if the request is accepted by Buyer, such request shall be in exchange for the return by Seller to Buyer of an agreed upon payment adjustment if payment has been made by Buyer for RECs from such Designated System. Such request shall include pertinent information related to the payment adjustment as well as requested changes to future Delivery Year Expected REC Quantity and Contract Nameplate Capacity. Any such request shall be deemed approved upon Buyer’s receipt of such agreed upon payment adjustment, and information regarding the receipt of and the calculation of the agreed upon payment adjustment shall be communicated to the IPA and its designee. Any such changes in the delivery schedule and adjustments made to future Delivery Year Expected REC Quantity and Contract Nameplate Capacity shall be documented in an amended Schedule B to the Product Order applicable to such Designated System issued by the IPA or its designee to Buyer and Seller.
(g) Surplus RECs are virtually tracked in the Surplus REC Account and shall remain, except as provided in Section 9.2 of the Master REC Agreement, in such account until a reduction in such Surplus RECs is recorded by the IPA or its designee to meet a Delivery Year Shortfall Amount.
(h) Upon the conclusion of the annual review process pursuant to Section 6(d) above for the last Delivery Year under this REC Contract, if (i) there are Surplus RECs remaining in the Surplus REC Account and (ii) an Aggregate Drawdown Payment has occurred during the Term of this REC Contract, then the IPA or its designee shall calculate a monetary refund adjustment due to Seller from Buyer. Buyer shall credit Seller for each Surplus REC that can be applied to a REC associated with a Drawdown Payment. For purpose of calculating the refund, Surplus RECs from the Surplus REC Account shall be reduced and applied to the RECs that are associated with a Drawdown Payment, starting with the REC with the lowest Contract Price, REC for REC. The monetary refund adjustment shall be paid from Buyer to Seller by December 31 following the conclusion of the last annual review process. For avoidance of doubt, no payment shall be made for any Surplus RECs that remain in the Surplus REC Account after the refund adjustment is calculated.thirty
Appears in 2 contracts
Sources: Renewable Energy Credit Purchase and Sale Agreement, Renewable Energy Credit Purchase and Sale Agreement
Deliveries and Quantity. (a) For each Designated System that has been Energized, the Delivery of at least one (1) REC from such Designated System is expected to occur to the Buyer’s PJM-EIS GATS account or M-RETS account, as applicable, within 90 calendar days of when such Designated System was Energized if the Actual Contract Nameplate Capacity of such Designated System is greater than 5kW or within 180 calendar days of when the Designated System was Energized if the Actual Contract Nameplate Capacity of such Designated System is equal to or less than 5kW. For each Designated System that fails to Deliver at least (1) one REC from such Designated System by the applicable deadlineSystem, Seller must provide to Buyer and the IPA or its designee, with respect to such Designated System, a written notice within sixty thirty (6030) days of the applicable deadline to Deliver at least one (1) REC confirming that there are no technical issues, with respect to such Designated System, known to Seller that would impede the generation, issuance and Delivery of RECs from such Designated System or that such technical issues have has been resolved by Seller. In the event that Seller fails to provide such written notice within sixty (60) days of the applicable deadline to Deliver at least one (1) REC, then the number of RECs associated with such Designated System shall be deemed removed from this REC Contract and Buyer shall be entitled to payment by Seller in the amount of the greater of: (i) the Collateral Requirement for such Designated System or (ii) one hundred percent (100%) of the total payments Seller has received from Buyer associated with RECs from such Designated System.;
(b) For each Designated System that has been Energized, all RECs designated to be Delivered pursuant to the Standing Order associated with such Designated System shall be Delivered to Buyer commencing from the date such Standing Order is established through the end of the Delivery Term of such Designated System regardless of whether the total payment made by Buyer to Seller for RECs from such Designated System is commensurate with the actual number of RECs Delivered from such Designated System.;
(c) For each Designated System that has been Energized, a REC delivery schedule is provided in Schedule B to the associated Product Order applicable to such Designated System that contains the expected number of RECs to be Delivered through the end of the Delivery Term where the number of RECs expected to be Delivered in each Delivery Year is based on the Designated System applicable Capacity Factor, Contract Maximum REC Quantity Nameplate Capacity and a degradation factor of half of one percent (0.5%) annually, and rounded down to the nearest whole REC in each Delivery YearREC. The REC quantities expected to be Delivered from such Designated System in a Delivery Year shall be the “Delivery Year Expected REC Quantity” for such Delivery Year. For avoidance of doubt, with respect to a Designated System, the Delivery Year Expected REC Quantities in the delivery schedule are determined at the time of Energization and not when the Delivery Term starts. As such, for purposes of calculating the Delivery Year Expected REC Quantity for each Delivery Year, the Delivery Year in which the date of Energization occurred shall be the first Delivery Year for which a Delivery Year Expected REC Quantity is calculated and the Delivery Year Expected REC Quantity for such first Delivery Year shall reflect an annualized number based on allocating the Designated System Contract Maximum REC Quantity across 15 years using a degradation factor of half of one percent (0.5%) annually. If the Delivery Term extends beyond a 15-Delivery Year schedule starting with that first Delivery Year, then each subsequent Delivery Year Expected REC Quantity subsequent to the 15th Delivery Year shall reflect a quantity that provides for a degradation factor of half of one percent (0.5%) from the prior Delivery Year Expected REC Quantity (a sample delivery schedule Delivery Schedule is provided in Exhibit F).;
(d) Once annually on or prior to November 15 following a Delivery Year, the IPA or its designee shall review the performance of the REC deliveries made during such Delivery Year and determine the amount of Aggregate Drawdown Payment payment due as follows:
(i) For each Designated System that has been Energized and three (3) full Delivery Years has occurred since the start of the Delivery Term of such Designated SystemEnergized, the IPA or its designee shall calculate, with respect to a Delivery Year, a Delivery Year REC Performance for such Delivery Year (an example Delivery Year REC Performance calculation is provided in Exhibit G);
(ii) With respect to a Designated System that has been Energized and three (3) full Delivery Years has occurred since the start of the Delivery Term of such Designated System, in the event that the Delivery Year REC Performance is greater than the applicable Delivery Year Expected REC Quantity, the difference in the number amount of RECs REC quantities shall be the “Delivery Year Surplus Amount” and each REC included issued in the Delivery Year Surplus Amount excess shall be a “Surplus REC”. For avoidance of doubt, RECs that are issued later in the Delivery Year are to be considered first as Surplus RECs ahead of RECs issued earlier in the Delivery Year if the Delivery Year Surplus Amount exceeds the number of RECs that are of the latest vintage as recorded by PJM EIS GATS or M-RETS for such Delivery Year. Surplus RECs are tracked in the Surplus REC Account and shall remain in such account until a reduction in such Surplus RECs are recorded by the IPA or its designee to meet a Delivery Year Shortfall Amount;
(iii) With respect to a Designated System that has been Energized and three (3) full Delivery Years has occurred since the start of the Delivery Term of such Designated System, in the event that the Delivery Year REC Performance is less than the Delivery Year Expected REC Quantity, the difference in the number amount of RECs REC quantities shall be the “Delivery Year Shortfall Amount;”;
(iv) For each Designated System that has a Delivery Year Shortfall Amount, starting with the Designated System with the lowest Contract Price, Surplus RECs from the Surplus REC Account shall be reduced and allocated to meet such Delivery Year Shortfall Amount, REC for REC. If there are insufficient Surplus RECs to meet the Delivery Year Shortfall Amount, then the number amount of RECs REC quantity calculated as the difference between the Delivery Year Shortfall Amount and the sum of such Surplus RECs being applied to meet the Delivery Year Shortfall Amount is the “Drawdown REC Quantity”, and the multiplicative product of the Drawdown REC Quantity and the Contract Price of such Designated System is the “Drawdown Payment”; and
(v) At the end of the foregoing process:
(1) Buyer shall draw on Seller’s Performance Assurance in the amount of the Aggregate Drawdown Payment. Seller shall be required to replenish Seller’s Performance Assurance in accordance with Section 4.3 of the Master REC Agreementas provided herein. If Seller’s Performance Assurance is less than the Aggregate Drawdown Payment, then Seller shall pay Buyer the difference within fifteen
ten (1510) Business Days of notice by Buyer. Failure by Seller to pay Buyer shall be an Event of Default subject to the Termination remedies under this REC Contract Notwithstanding the foregoing, if this is not the last Delivery Year under this REC Contract and the amount of the Aggregate Drawdown Payment is less than $5,000, then Buyer shall not draw on Seller’s Performance Assurance, but will track such amount and add such amount to the Aggregate Drawdown Payment for the subsequent Delivery Year or Delivery Years until the earlier of: the last Delivery Year or such time when the Aggregate Drawdown Payment is at least $5,000;Contract; and
(2) For purposes of calculating the Delivery Year REC Performance in the future Delivery Yearsyears, each Designated System that has a Delivery Year Shortfall Amount for which such Delivery Year Shortfall Amount is covered by Surplus REC(s) RECs and/or for which a payment from Seller or from Seller’s Performance Assurance has been applied to the Drawdown REC Quantity, such Designated System is deemed to have Delivered REC quantities equal to the Delivery Year Expected REC Quantity in such Delivery Year.
(e) If a Designated System is a Community Renewable Energy Generation Project, such Designated System must maintain at least the Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed as provided in the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet throughout the remainder of the Delivery Term after the issuance first year of such Community Solar Quarterly Reportoperations. Failure to maintain the Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed as provided in the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet in a Delivery Year shall result in payment to Buyer from Seller of a monetary amount, determined by the IPA or its designee, and Buyer may draw on Seller’s Performance Assurance for this purpose. For each Delivery Year after the issuance of the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet, the subscription percentage and Community Solar Subscription Mix will each be calculated as a daily average, then averaged over the Delivery Year, based on actual subscription start and end dates entered in the REC Annual Report. The draw on Seller’s Performance Assurance will be calculated as the difference between (a) the contracted payment for that Delivery Year and (b) the amount that would have been paid given the realized Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed, if (a) exceeds (b). This amount will be calculated in arrears for only the immediately preceding Delivery Year covered by the REC Annual Report. If the Designated System regains a Community Solar Subscription mix and subscription percentage at or above their contracted amount in subsequent years, a drawdown will not occur in those years; however, overperformance in a Delivery Year will not be banked or applied to past Delivery Years. Designated Systems with subscription levels above 90% of Actual Nameplate Capacity on a kW capacity basis for a Delivery Year will not be subject to a draw on Seller’s Performance Assurance for that Delivery Year on the basis of subscription percentage. This calculation will only occur after the final Contract Price and quantity of RECs due payment are determined per section 5(e)(iv)(D) of the Cover Sheet and will be based on that final Contract Price and quantity which is determined by the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet.
(f) During the Delivery Term, Seller may determine that a Designated System is not performing at the level expected. In such case, Seller may submit a request to Buyer and the IPA (or its designee) to have the Delivery obligations of such Designated System reduced, and if the request is accepted by Buyer, such request shall be reduced in exchange for the return by Seller to Buyer of an agreed upon payment adjustment if payment has been made by Buyer for RECs from such Designated System. Such request shall include pertinent information related to the payment adjustment as well as requested changes to future Delivery Year Expected REC Quantity and Contract Nameplate Capacity. Any such request shall be deemed approved upon Buyer’s receipt of such agreed upon payment adjustment, and information regarding the receipt of and the calculation of the agreed upon payment adjustment shall be communicated to the IPA and its designee. Any such changes in the delivery schedule and adjustments made to future Delivery Year Expected REC Quantity and Contract Nameplate Capacity shall be documented in an amended Schedule B to the Product Order applicable to such Designated System issued by the IPA or its designee to Buyer and Seller.
(g) Surplus RECs are virtually tracked in the Surplus REC Account and shall remain, except as provided in Section 9.2 of the Master REC Agreement, in such account until a reduction in such Surplus RECs is recorded by the IPA or its designee to meet a Delivery Year Shortfall Amount.
(h) Upon the conclusion of the annual review process pursuant to Section 6(d) above for the last Delivery Year under this REC Contract, if (i) there are Surplus RECs remaining in the Surplus REC Account and (ii) an Aggregate Drawdown Payment has occurred during the Term of this REC Contract, then the IPA or its designee shall calculate a monetary refund adjustment due to Seller from Buyer. Buyer shall credit Seller for each Surplus REC that can be applied to a REC associated with a Drawdown Payment. For purpose of calculating the refund, Surplus RECs from the Surplus REC Account shall be reduced and applied to the RECs that are associated with a Drawdown Payment, starting with the REC with the lowest Contract Price, REC for REC. The monetary refund adjustment shall be paid from Buyer to Seller by December 31 following the conclusion of the last annual review process. For avoidance of doubt, no payment shall be made for any Surplus RECs that remain in the Surplus REC Account after the refund adjustment is calculated.
Appears in 2 contracts
Sources: Renewable Energy Credit Agreement, Renewable Energy Credit Agreement
Deliveries and Quantity. (a) For each Designated System that has been Energized, the Delivery of at least one (1) REC from such Designated System is expected to occur to the Buyer’s PJM-EIS GATS account or M-RETS account, as applicable, within 90 calendar ninety (90) days of when such Designated System was Energized if the Actual Nameplate Capacity of such Designated System is greater than 5kW or within 180 calendar one hundred eighty (180) days of when the Designated System was Energized if the Actual Nameplate Capacity of such Designated System is equal to or less than 5kW. For each Designated System that fails to Deliver at least (1) one REC from such Designated System by the applicable deadline, Seller must provide to Buyer and the IPA or its designeeIPA, with respect to such Designated System, a written notice within sixty (60) days of the applicable deadline to Deliver at least one one
(1) REC confirming that there are no technical issues, with respect to such Designated System, known to Seller that would impede the generation, issuance and Delivery of RECs from such Designated System or that such technical issues have been resolved by Seller. In the event that Seller fails to provide such written notice within sixty (60) days of the applicable deadline to Deliver at least one (1) REC, then the number of Designated System and the RECs associated with such Designated System shall be deemed removed from this REC Contract Contract. As soon as practicable after the occurrence of such failure by Seller, the IPA shall provide to Buyer and Seller a revised Schedule A, Schedule B, and Schedule C to the Product Order for such Designated System indicating the removal of such Designated System from the REC Contract. Upon the occurrence of such failure, Buyer shall be entitled to payment by Seller in the amount of the greater of: (i) the Collateral Requirement for such Designated System or (ii) one hundred percent (100%) of the total payments Seller has received from Buyer associated with RECs from such Designated System.
(b) For each Designated System that has been Energized, all RECs designated to be Delivered pursuant to the Standing Order associated with such Designated System shall be Delivered to Buyer commencing from the date such Standing Order is established through the end of the Delivery Term of such Designated System regardless of whether the total payment made by Buyer to Seller for RECs from such Designated System is commensurate with the actual number of RECs Delivered from such Designated System.
(c) For each Designated System that has been Energized, a REC delivery schedule is provided in Schedule B to the Product Order applicable to such Designated System that contains the expected number of RECs to be Delivered through the end of the Delivery Term where the number of RECs expected to be Delivered in each Delivery Year is based on the Designated System Contract Maximum REC Quantity and a degradation factor of half of one percent (0.5%) annually, and rounded down to the nearest whole REC in each Delivery Year. The REC quantities expected to be Delivered from such Designated System in a Delivery Year shall be the “Delivery Year Expected REC Quantity” for such Delivery Year. For avoidance of doubt, with respect to a Designated System, the Delivery Year Expected REC Quantities in the delivery schedule are determined at the time of Energization and not when the Delivery Term starts. As such, for purposes of calculating the Delivery Year Expected REC Quantity for each Delivery Year, the Delivery Year in which the date of Energization occurred shall be the first Delivery Year for which a Delivery Year Expected REC Quantity is calculated and the Delivery Year Expected REC Quantity for such first Delivery Year shall reflect an annualized number based on allocating the Designated System Contract Maximum REC Quantity across 15 years using a degradation factor of half of one percent (0.5%) annually. If the Delivery Term extends beyond a 15-Delivery Year schedule starting with that first Delivery Year, then each subsequent Delivery Year Expected REC Quantity subsequent to the 15th Delivery Year shall reflect a quantity that provides for a degradation factor of half of one percent (0.5%) from the prior Delivery Year Expected REC Quantity (a sample delivery schedule is provided in Exhibit F).
(d) Once annually on or prior to November 15 following a Delivery Year, the IPA or its designee shall review the performance of the REC deliveries made during such Delivery Year Year, using information provided in the REC Annual Report submitted pursuant to Section 10(c) of the Cover Sheet, and determine the amount of Aggregate Drawdown Payment due as follows:
(i) For each Designated System that has been Energized and three (3) full Delivery Years has have occurred since the start of the Delivery Term of such Designated System, the IPA or its designee shall calculate, with respect to a Delivery Year, a Delivery Year REC Performance for such Delivery Year (an example Delivery Year REC Performance calculation is provided in Exhibit G);
(ii) With respect to a Designated System that has been Energized and three (3) full Delivery Years has have occurred since the start of the Delivery Term of such Designated System, in the event that the Delivery Year REC Performance is greater than the applicable Delivery Year Expected REC Quantity, the difference in the number of RECs shall be the “Delivery Year Surplus Amount” and each REC included in the Delivery Year Surplus Amount shall be a “Surplus REC”;
(iii) With respect to a Designated System that has been Energized and three (3) full Delivery Years has have occurred since the start of the Delivery Term of such Designated System, in the event that the Delivery Year REC Performance is less than the Delivery Year Expected REC Quantity, the difference in the number of RECs shall be the “Delivery Year Shortfall Amount”;
(iv) For each Designated System that has a Delivery Year Shortfall Amount, starting with the Designated System with the lowest Contract Price, Surplus RECs from the Surplus REC Account shall be reduced and allocated to meet such Delivery Year Shortfall Amount, REC for REC. If there are insufficient Surplus RECs to meet the Delivery Year Shortfall Amount, then the number of RECs calculated as the difference between the Delivery Year Shortfall Amount and the sum of such Surplus RECs being applied to meet the Delivery Year Shortfall Amount is the “Drawdown REC Quantity”, and the multiplicative product of the Drawdown REC Quantity and the Contract Price of such Designated System is the “Drawdown Payment”; and
(v) At the end of the foregoing process:
(1) Buyer shall inform Seller of the Aggregate Drawdown Payment (including any Drawdown Payment pursuant to Section 6(d)(iv) of the Cover Sheet and any Drawdown Payment pursuant to Section 6(e) of the Cover Sheet) by written notice and Seller may, within five (5) Business Days of such written notice, request for payment of the Aggregate Drawdown Payment to be made by additional cash transfer by Seller to Buyer or request for the payment of the Aggregate Drawdown Payment to be made from the cash or the Letter of Credit held as Seller’s Performance Assurance if both cash and a Letter of Credit are held as Seller’s Performance Assurance. If Buyer does not receive such request from Seller within such five (5) Business Day period, or if Seller makes a request within the five (5) Business Day period to pay with cash and then fails to remit the full cash payment by the fourteenth (14th) Business Day after Buyer’s written notice to Seller, Buyer shall draw on Seller’s Performance Assurance to reach the full amount of the Aggregate Drawdown Payment. If Buyer does receive such request from Seller for a draw on a particular form of Performance Assurance within such five (5) Business Day period, then Buyer shall draw on Seller’s Performance Assurance in the amount form requested. In all cases of a draw on Performance Assurance, the Aggregate Drawdown Paymentdraw shall be made on or after the fifteenth (15th) Business Day after Buyer’s written notice to Seller. Seller shall be required to replenish Seller’s Performance Assurance in accordance with Section 4.3 of the Master REC Agreement. If Seller’s Performance Assurance is less than the Aggregate Drawdown Payment, or if Seller has requested to make such payments by additional cash transfer, then Seller shall pay Buyer the difference or the amount of such payments, respectively, within fifteen
fifteen (15) Business Days of notice by Buyer. Failure by Seller to pay Buyer shall be an Event of Default subject to the Termination remedies under this REC Contract Contract. Notwithstanding the foregoing, if this is not the last Delivery Year under this REC Contract and the amount of the Aggregate Drawdown Payment is less than $5,000, then Buyer shall not draw on Seller’s Performance Assurance, but will track such amount and add such amount to the Aggregate Drawdown Payment for the subsequent Delivery Year or Delivery Years until the earlier of: the last Delivery Year or such time when the Aggregate Drawdown Payment is at least $5,000;
(2) For purposes of calculating the Delivery Year REC Performance in future Delivery Years, each Designated System that has a Delivery Year Shortfall Amount for which such Delivery Year Shortfall Amount is covered by Surplus REC(s) and/or for which a payment from Seller or from Seller’s Performance Assurance has been applied to the Drawdown REC Quantity, such Designated System is deemed to have Delivered REC quantities equal to the Delivery Year Expected REC Quantity in such Delivery Year.
(e) If a Designated System is a Community Renewable Energy Generation Project, such Designated System must maintain at least the Community Solar Subscription Mix Mix, the percent of Actual Nameplate Capacity that has been subscribed by the Anchor Tenant and the percent of Actual Nameplate Capacity that has been subscribed by End Use Customers as provided in the last Community Solar Quarterly First Year Report submitted pursuant to Section 10(b) of the Cover Sheet throughout the remainder of the Delivery Term after the issuance of such Community Solar Quarterly First Year Report. Failure to maintain the Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed by the Anchor Tenant and the percent of Actual Nameplate Capacity that has been subscribed by End Use Customers as provided in the last Community Solar Quarterly First Year Report submitted pursuant to Section 10(b) of the Cover Sheet in a Delivery Year shall result in payment to Buyer from Seller of a monetary amount, determined by the IPA or its designeeIPA, and Buyer may draw on Seller’s Performance Assurance for this purpose. The Designated System must maintain the minimum Community Solar Subscription Mix required under the SFA for the REC price adder obtained in the Non-Anchor Tenant Contract Price that resulted from the Community Solar Subscription Mix indicated in the Community Solar First Year Report; the Designated System must also maintain the subscription shares of the Anchor Tenant and End Use Customers as indicated in the Community Solar First Year Report. For each Delivery Year after the issuance of the last Community Solar Quarterly First Year Report submitted pursuant to Section 10(b) of the Cover Sheet, then, using the subscription percentage REC Annual Report submitted under Section 10(c) of the Cover Sheet and at the same time as the calculations made under Section 6(d) of the Cover Sheet: the Community Solar Subscription Mix as well as the subscription share percentages of the Anchor Tenant and End Use Customers will each be calculated by the IPA as a daily average, then averaged over the Delivery Year, . This daily average will be based on actual subscription start and end dates comprised of the day that a subscription start or end request was submitted to the utility, as entered in the REC Annual Report. The draw on Seller’s Performance Assurance will be calculated as the sum of the following: (i) the difference between (a) the contracted payment for Community Solar Anchor Payment allocable to that Delivery Year and (b) the amount that would have been paid for the Anchor Tenant’s subscription share for that Delivery Year given the realized Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribedsubscribed by Anchor Tenant in that Delivery Year, if (a) exceeds (b). This amount will be calculated in arrears for only the immediately preceding Delivery Year covered by the REC Annual Report. If the Designated System regains a Community Solar Subscription mix and subscription percentage at or above their contracted amount in subsequent years, a drawdown will not occur in those years; however, overperformance in a Delivery Year will not be banked or applied to past Delivery Years. Designated Systems with subscription levels above 90% of Actual Nameplate Capacity on a kW capacity basis for a Delivery Year will not be subject to a draw on Seller’s Performance Assurance for that Delivery Year on the basis of subscription percentage. This calculation will only occur after the final Contract Price and quantity of RECs due payment are determined per section 5(e)(iv)(D) of the Cover Sheet and will be based on that final Contract Price and quantity which is determined by the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet.
(f) During the Delivery Term, Seller may determine that a Designated System is not performing at the level expected. In such case, Seller may submit a request to Buyer and the IPA (or its designee) to have the Delivery obligations of such Designated System reduced, and if the request is accepted by Buyer, such request shall be in exchange for the return by Seller to Buyer of an agreed upon payment adjustment if payment has been made by Buyer for RECs from such Designated System. Such request shall include pertinent information related to the payment adjustment as well as requested changes to future Delivery Year Expected REC Quantity and Contract Nameplate Capacity. Any such request shall be deemed approved upon Buyer’s receipt of such agreed upon payment adjustment, and information regarding the receipt of and the calculation of the agreed upon payment adjustment shall be communicated to the IPA and its designee. Any such changes in the delivery schedule and adjustments made to future Delivery Year Expected REC Quantity and Contract Nameplate Capacity shall be documented in an amended Schedule B to the Product Order applicable to such Designated System issued by the IPA or its designee to Buyer and Seller.
(g) Surplus RECs are virtually tracked in the Surplus REC Account and shall remain, except as provided in Section 9.2 of the Master REC Agreement, in such account until a reduction in such Surplus RECs is recorded by the IPA or its designee to meet a Delivery Year Shortfall Amount.
(h) Upon the conclusion of the annual review process pursuant to Section 6(d) above for the last Delivery Year under this REC Contract, if (i) there are Surplus RECs remaining in the Surplus REC Account and (ii) an Aggregate Drawdown the difference between (x) the Community Solar Non-Anchor Payment has occurred during the Term of this REC Contract, then the IPA or its designee shall calculate a monetary refund adjustment due allocable to Seller from Buyer. Buyer shall credit Seller for each Surplus REC that can be applied to a REC associated with a Drawdown Payment. For purpose of calculating the refund, Surplus RECs from the Surplus REC Account shall be reduced and applied to the RECs that are associated with a Drawdown Payment, starting with the REC with the lowest Contract Price, REC for REC. The monetary refund adjustment shall be paid from Buyer to Seller by December 31 following the conclusion of the last annual review process. For avoidance of doubt, no payment shall be made for any Surplus RECs that remain in the Surplus REC Account after the refund adjustment is calculated.Delivery Year and
Appears in 2 contracts
Sources: Renewable Energy Credit Agreement, Renewable Energy Credit Agreement
Deliveries and Quantity. (a) For each Designated System that has been Energized, the Delivery of at least one (1) REC from such Designated System is expected to occur to the Buyer’s PJM-EIS GATS account or M-RETS account, as applicable, within 90 calendar ninety (90) days of when such Designated System was Energized if the Actual Nameplate Capacity of such Designated System is greater than 5kW or within 180 calendar one hundred eighty (180) days of when the Designated System was Energized if the Actual Nameplate Capacity of such Designated System is equal to or less than 5kW. For each Designated System that fails to Deliver at least (1) one REC from such Designated System by the applicable deadline, Seller must provide to Buyer and the IPA or its designeeIPA, with respect to such Designated System, a written notice within sixty (60) days of the applicable deadline to Deliver at least one one
(1) REC confirming that there are no technical issues, with respect to such Designated System, known to Seller that would impede the generation, issuance and Delivery of RECs from such Designated System or that such technical issues have been resolved by Seller. In the event that Seller fails to provide such written notice within sixty (60) days of the applicable deadline to Deliver at least one (1) REC, then the number of Designated System and the RECs associated with such Designated System shall be deemed removed from this REC Contract Contract. As soon as practicable after the occurrence of such failure by Seller, the IPA shall provide to Buyer and Seller a revised Schedule A, Schedule B, and Schedule C to the Product Order for such Designated System indicating the removal of such Designated System from the REC Contract. Upon the occurrence of such failure, Buyer shall be entitled to payment by Seller in the amount of the greater of: (i) the Collateral Requirement for such Designated System or (ii) one hundred percent (100%) of the total payments Seller has received from Buyer associated with RECs from such Designated System.
(b) For each Designated System that has been Energized, all RECs designated to be Delivered pursuant to the Standing Order associated with such Designated System shall be Delivered to Buyer commencing from the date such Standing Order is established through the end of the Delivery Term of such Designated System regardless of whether the total payment made by Buyer to Seller for RECs from such Designated System is commensurate with the actual number of RECs Delivered from such Designated System.
(c) For each Designated System that has been Energized, a REC delivery schedule is provided in Schedule B to the Product Order applicable to such Designated System that contains the expected number of RECs to be Delivered through the end of the Delivery Term where the number of RECs expected to be Delivered in each Delivery Year is based on the Designated System Contract Maximum REC Quantity and a degradation factor of half of one percent (0.5%) annually, and rounded down to the nearest whole REC in each Delivery Year. The REC quantities expected to be Delivered from such Designated System in a Delivery Year shall be the “Delivery Year Expected REC Quantity” for such Delivery Year. For avoidance of doubt, with respect to a Designated System, the Delivery Year Expected REC Quantities in the delivery schedule are determined at the time of Energization and not when the Delivery Term starts. As such, for purposes of calculating the Delivery Year Expected REC Quantity for each Delivery Year, the Delivery Year in which the date of Energization occurred shall be the first Delivery Year for which a Delivery Year Expected REC Quantity is calculated and the Delivery Year Expected REC Quantity for such first Delivery Year shall reflect an annualized number based on allocating the Designated System Contract Maximum REC Quantity across 15 years using a degradation factor of half of one percent (0.5%) annually. If the Delivery Term extends beyond a 15-Delivery Year schedule starting with that first Delivery Year, then each subsequent Delivery Year Expected REC Quantity subsequent to the 15th Delivery Year shall reflect a quantity that provides for a degradation factor of half of one percent (0.5%) from the prior Delivery Year Expected REC Quantity (a sample delivery schedule is provided in Exhibit F).
(d) Once annually on or prior to November 15 following a Delivery Year, the IPA or its designee shall review the performance of the REC deliveries made during such Delivery Year Year, using information provided in the REC Annual Report submitted pursuant to Section 10(c) of the Cover Sheet, and determine the amount of Aggregate Drawdown Payment due as follows:
(i) For each Designated System that has been Energized and three (3) full Delivery Years has have occurred since the start of the Delivery Term of such Designated System, the IPA or its designee shall calculate, with respect to a Delivery Year, a Delivery Year REC Performance for such Delivery Year (an example Delivery Year REC Performance calculation is provided in Exhibit G);
(ii) With respect to a Designated System that has been Energized and three (3) full Delivery Years has have occurred since the start of the Delivery Term of such Designated System, in the event that the Delivery Year REC Performance is greater than the applicable Delivery Year Expected REC Quantity, the difference in the number of RECs shall be the “Delivery Year Surplus Amount” and each REC included in the Delivery Year Surplus Amount shall be a “Surplus REC”;
(iii) With respect to a Designated System that has been Energized and three (3) full Delivery Years has have occurred since the start of the Delivery Term of such Designated System, in the event that the Delivery Year REC Performance is less than the Delivery Year Expected REC Quantity, the difference in the number of RECs shall be the “Delivery Year Shortfall Amount”;
(iv) For each Designated System that has a Delivery Year Shortfall Amount, starting with the Designated System with the lowest Contract Price, Surplus RECs from the Surplus REC Account shall be reduced and allocated to meet such Delivery Year Shortfall Amount, REC for REC. If there are insufficient Surplus RECs to meet the Delivery Year Shortfall Amount, then the number of RECs calculated as the difference between the Delivery Year Shortfall Amount and the sum of such Surplus RECs being applied to meet the Delivery Year Shortfall Amount is the “Drawdown REC Quantity”, and the multiplicative product of the Drawdown REC Quantity and the Contract Price of such Designated System is the “Drawdown Payment”; and
(v) At the end of the foregoing process:
(1) Buyer shall inform Seller of the Aggregate Drawdown Payment (including any Drawdown Payment pursuant to Section 6(d)(iv) of the Cover Sheet and any Drawdown Payment pursuant to Section 6(e) of the Cover Sheet) by written notice and Seller may, within five (5) Business Days of such written notice, request for payment of the Aggregate Drawdown Payment to be made by additional cash transfer by Seller to Buyer or request for the payment of the Aggregate Drawdown Payment to be made from the cash or the Letter of Credit held as Seller’s Performance Assurance if both cash and a Letter of Credit are held as Seller’s Performance Assurance. If Buyer does not receive such request from Seller within such five (5) Business Day period, or if Seller makes a request within the five (5) Business Day period to pay with cash and then fails to remit the full cash payment by the fourteenth (14th) Business Day after Buyer’s written notice to Seller, Buyer shall draw on Seller’s Performance Assurance to reach the full amount of the Aggregate Drawdown Payment. If Buyer does receive such request from Seller for a draw on a particular form of Performance Assurance within such five (5) Business Day period, then Buyer shall draw on Seller’s Performance Assurance in the amount form requested. In all cases of a draw on Performance Assurance, the Aggregate Drawdown Paymentdraw shall be made on or after the fifteenth (15th) Business Day after Buyer’s written notice to Seller. Seller shall be required to replenish Seller’s Performance Assurance in accordance with Section 4.3 of the Master REC Agreement. If Seller’s Performance Assurance is less than the Aggregate Drawdown Payment, or if Seller has requested to make such payments by additional cash transfer, then Seller shall pay Buyer the difference or the amount of such payments, respectively, within fifteen
fifteen (15) Business Days of notice by Buyer. Failure by Seller to pay Buyer shall be an Event of Default subject to the Termination remedies under this REC Contract Contract. Notwithstanding the foregoing, if this is not the last Delivery Year under this REC Contract and the amount of the Aggregate Drawdown Payment is less than $5,000, then Buyer shall not draw on Seller’s Performance Assurance, but will track such amount and add such amount to the Aggregate Drawdown Payment for the subsequent Delivery Year or Delivery Years until the earlier of: the last Delivery Year or such time when the Aggregate Drawdown Payment is at least $5,000;
(2) For purposes of calculating the Delivery Year REC Performance in future Delivery Years, each Designated System that has a Delivery Year Shortfall Amount for which such Delivery Year Shortfall Amount is covered by Surplus REC(s) and/or for which a payment from Seller or from Seller’s Performance Assurance has been applied to the Drawdown REC Quantity, such Designated System is deemed to have Delivered REC quantities equal to the Delivery Year Expected REC Quantity in such Delivery Year.
(e) If a Designated System is a Community Renewable Energy Generation Project, such Designated System must maintain at least the Community Solar Subscription Mix Mix, the percent of Actual Nameplate Capacity that has been subscribed by the Anchor Tenant and the percent of Actual Nameplate Capacity that has been subscribed by End Use Customers as provided in the last Community Solar Quarterly First Year Report submitted pursuant to Section 10(b) of the Cover Sheet throughout the remainder of the Delivery Term after the issuance of such Community Solar Quarterly First Year Report. Failure to maintain the Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed by the Anchor Tenant and the percent of Actual Nameplate Capacity that has been subscribed by End Use Customers as provided in the last Community Solar Quarterly First Year Report submitted pursuant to Section 10(b) of the Cover Sheet in a Delivery Year shall result in payment to Buyer from Seller of a monetary amount, determined by the IPA or its designeeIPA, and Buyer may draw on Seller’s Performance Assurance for this purpose. The Designated System must maintain the minimum Community Solar Subscription Mix required under the SFA for the REC price adder obtained in the Non-Anchor Tenant Contract Price that resulted from the Community Solar Subscription Mix indicated in the Community Solar First Year Report; the Designated System must also maintain the subscription shares of the Anchor Tenant and End Use Customers as indicated in the Community Solar First Year Report. For each Delivery Year after the issuance of the last Community Solar Quarterly First Year Report submitted pursuant to Section 10(b) of the Cover Sheet, then, using the subscription percentage REC Annual Report submitted under Section 10(c) of the Cover Sheet and at the same time as the calculations made under Section 6(d) of the Cover Sheet: the Community Solar Subscription Mix as well as the subscription share percentages of the Anchor Tenant and End Use Customers will each be calculated by the IPA as a daily average, then averaged over the Delivery Year, . This daily average will be based on actual subscription start and end dates comprised of the day that a subscription start or end request was submitted to the utility, as entered in the REC Annual Report. The draw on Seller’s Performance Assurance will be calculated as the sum of the following: (i) the difference between (a) the contracted payment for Community Solar Anchor Payment allocable to that Delivery Year and (b) the amount that would have been paid for the Anchor Tenant’s subscription share for that Delivery Year given the percent of Actual Nameplate Capacity that has been subscribed by Anchor Tenant in that Delivery Year, if (a) exceeds (b); and (ii) the difference between (x) the Community Solar Non-Anchor Payment allocable to that Delivery Year and (y) the amount that would have been paid for the End Use Customers’ subscription share for that Delivery Year given the realized Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribedsubscribed by End Use Customers in that Delivery Year, if (ax) exceeds (y).3 (Provided, that the draw on Seller’s Performance Assurance will simply equal the total payment allocable to that Delivery Year if the percent of Non-Anchor Nameplate Capacity that has been subscribed by End Use Customers in that Delivery Year is less than fifty percent (50%); but if this deficiency is due to the loss of an Anchor Tenant in the Delivery Year, the Seller shall have a specified period determined by the IPA from the end of the Delivery Year to cure the deficiency before such a draw is made. If the percent of Non-Anchor Nameplate Capacity that has been subscribed by End Use Customers is at least fifty percent (50%) at the end of such cure period, the draw on Seller’s Performance Assurance will be calculated as the sum of the following: (i) the difference between (a) the Community Solar Anchor Payment allocable to that Delivery Year and (b) the amount that would have been paid for the Anchor Tenant’s subscription share for that Delivery Year given the percent of Actual Nameplate Capacity that has been subscribed by Anchor Tenant in that Delivery Year). ; and (ii) the difference between (x) the Community Solar Non-Anchor Payment allocable to that Delivery Year and (y) the amount that would have been paid for the End Use Customers’ subscription share for that Delivery Year given the realized Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed by End Use Customers in that Delivery Year, if (x) exceeds (y), but will not be the total payment allocable to that Delivery Year.) This amount will be calculated in arrears for only the immediately preceding Delivery Year covered by the REC Annual Report. If a Designated System meets a Community Solar Subscription Mix requirement for a lower REC price adder than what was obtained following the Community Solar First Year Report, it will be deemed to have obtained that lower adder for the Delivery Year for the purposes of calculating the draw above. If the Designated System regains a Community Solar Subscription mix and subscription percentage at or above their contracted amount in subsequent years, a drawdown will not occur in those years; however, overperformance in a Delivery Year will not be banked or applied to past Delivery Years. Designated Systems with total subscription levels (including only subscription shares of the Anchor Tenant and End Use Customers) above 90% of Actual Nameplate Capacity on a kW capacity basis for a Delivery Year will not be subject to a draw on Seller’s Performance Assurance for that Delivery Year on the basis of subscription percentage. This calculation will only occur after the final Contract Price and quantity of RECs due payment are determined per section 5(e)(iv)(DSections 5(f)(i)-(iii) of the Cover Sheet and will be based on that final Contract Price and quantity which is determined by the last Community Solar Quarterly First Year Report submitted pursuant to Section 10(b) of the Cover Sheet.
(f) During . Notwithstanding any of the Delivery Termforegoing, Seller may determine that a Designated System is not performing at the level expected. In such case, Seller may submit a request to Buyer and the IPA (or its designee) to have the Delivery obligations of such Designated System reduced, and if the request is accepted by Buyer, such request shall be in exchange for the return by Seller to Buyer total combined percent of an agreed upon payment adjustment if payment Actual Nameplate Capacity that has been made subscribed by Buyer the Anchor Tenant and by End Use Customers has decreased for RECs from a Delivery Year and such Designated System. Such request shall include pertinent information related decrease is no more than three percentage points (3% points) relative to the payment adjustment as well as requested changes to future Delivery Year Expected REC Quantity and Contract Nameplate Capacity. Any such request shall be deemed approved upon Buyer’s receipt total combined percent of such agreed upon payment adjustment, and information regarding the receipt of and the calculation of the agreed upon payment adjustment shall be communicated to the IPA and its designee. Any such changes in the delivery schedule and adjustments made to future Delivery Year Expected REC Quantity and Contract Actual Nameplate Capacity shall be documented in an amended Schedule B to the Product Order applicable to such Designated System issued that has been subscribed by the IPA or its designee to Buyer Anchor Tenant and Seller.
(g) Surplus RECs are virtually tracked in the Surplus REC Account and shall remain, except by End Use Customers as provided in Section 9.2 of the Master REC Agreement, in such account until a reduction in such Surplus RECs is recorded by the IPA or its designee to meet a Delivery Community Solar First Year Shortfall Amount.
(h) Upon the conclusion of the annual review process pursuant to Section 6(d) above for the last Delivery Year under this REC Contract, if (i) there are Surplus RECs remaining in the Surplus REC Account and (ii) an Aggregate Drawdown Payment has occurred during the Term of this REC Contract, then the IPA or its designee shall calculate a monetary refund adjustment due to Seller from Buyer. Buyer shall credit Seller for each Surplus REC that can be applied to a REC associated with a Drawdown Payment. For purpose of calculating the refund, Surplus RECs from the Surplus REC Account shall be reduced and applied to the RECs that are associated with a Drawdown Payment, starting with the REC with the lowest Contract Price, REC for REC. The monetary refund adjustment shall be paid from Buyer to Seller by December 31 following the conclusion of the last annual review process. 3 For avoidance of doubt, no payment the calculations made in this Section 6(e) shall be not take into account any adjustments made pursuant to Section 5(f)(ii) or Section 5(f)(vi) of the Cover Sheet. For purposes of the calculating the (a) Community Solar Anchor Payment, (b) Community Solar Non-Anchor Payment, (c) the amounts that would have been paid for any Surplus RECs that remain in the Surplus REC Account after the refund adjustment is calculated.Anchor Tenant
Appears in 1 contract
Sources: Renewable Energy Credit Agreement
Deliveries and Quantity. (a) For each Designated System that has been Energized, the Delivery of at least one (1) REC from such Designated System is expected to occur to the Buyer’s PJM-EIS GATS account or M-RETS account, as applicable, within 90 calendar days of when such Designated System was Energized if the Actual Contract Nameplate Capacity of such Designated System is greater than 5kW or within 180 calendar days of when the Designated System was Energized if the Actual Contract Nameplate Capacity of such Designated System is equal to or less than 5kW. For each Designated System that fails to Deliver at least (1) one REC from such Designated System by the applicable deadlineSystem, Seller must provide to Buyer and the IPA or its designee, with respect to such Designated System, a written notice within sixty thirty (6030) days of the applicable deadline to Deliver at least one (1) REC confirming that there are no technical issues, with respect to such Designated System, known to Seller that would impede the generation, issuance and Delivery of RECs from such Designated System or that such technical issues have has been resolved by Seller. In the event that Seller fails to provide such written notice within sixty (60) days of the applicable deadline to Deliver at least one (1) REC, then the number of RECs associated with such Designated System shall be deemed removed from this REC Contract and Buyer shall be entitled to payment by Seller in the amount of the greater of: (i) the Collateral Requirement for such Designated System or (ii) one hundred percent (100%) of the total payments Seller has received from Buyer associated with RECs from such Designated System.
(b) ; For each Designated System that has been Energized, all RECs designated to be Delivered pursuant to the Standing Order associated with such Designated System shall be Delivered to Buyer commencing from the date such Standing Order is established through the end of the Delivery Term of such Designated System regardless of whether the total payment made by Buyer to Seller for RECs from such Designated System is commensurate with the actual number of RECs Delivered from such Designated System.
(c) ; For each Designated System that has been Energized, a REC delivery schedule is provided in Schedule B to the associated Product Order applicable to such Designated System that contains the expected number of RECs to be Delivered through the end of the Delivery Term where the number of RECs expected to be Delivered in each Delivery Year is based on the Designated System applicable Capacity Factor, Contract Maximum REC Quantity Nameplate Capacity and a degradation factor of half of one percent (0.5%) annually, and rounded down to the nearest whole REC in each Delivery YearREC. The REC quantities expected to be Delivered from such Designated System in a Delivery Year shall be the “Delivery Year Expected REC Quantity” for such Delivery Year. For avoidance of doubt, with respect to a Designated System, the Delivery Year Expected REC Quantities in the delivery schedule are determined at the time of Energization and not when the Delivery Term starts. As such, for purposes of calculating the Delivery Year Expected REC Quantity for each Delivery Year, the Delivery Year in which the date of Energization occurred shall be the first Delivery Year for which a Delivery Year Expected REC Quantity is calculated and the Delivery Year Expected REC Quantity for such first Delivery Year shall reflect an annualized number based on allocating the Designated System Contract Maximum REC Quantity across 15 years using a degradation factor of half of one percent (0.5%) annually. If the Delivery Term extends beyond a 15-Delivery Year schedule starting with that first Delivery Year, then each subsequent Delivery Year Expected REC Quantity subsequent to the 15th Delivery Year shall reflect a quantity that provides for a degradation factor of half of one percent (0.5%) from the prior Delivery Year Expected REC Quantity (a sample delivery schedule Delivery Schedule is provided in Exhibit F).
(d) ; Once annually on or prior to November 15 following a Delivery Year, the IPA or its designee shall review the performance of the REC deliveries made during such Delivery Year and determine the amount of Aggregate Drawdown Payment payment due as follows:
(i) : For each Designated System that has been Energized and three (3) full Delivery Years has occurred since the start of the Delivery Term of such Designated SystemEnergized, the IPA or its designee shall calculate, with respect to a Delivery Year, a Delivery Year REC Performance for such Delivery Year (an example Delivery Year REC Performance calculation is provided in Exhibit G);
(ii) ; With respect to a Designated System that has been Energized and three (3) full Delivery Years has occurred since the start of the Delivery Term of such Designated System, in the event that the Delivery Year REC Performance is greater than the applicable Delivery Year Expected REC Quantity, the difference in the number amount of RECs REC quantities shall be the “Delivery Year Surplus Amount” and each REC included issued in the Delivery Year Surplus Amount excess shall be a “Surplus REC”;
(iii) . For avoidance of doubt, RECs that are issued later in the Delivery Year are to be considered first as Surplus RECs ahead of RECs issued earlier in the Delivery Year if the Delivery Year Surplus Amount exceeds the number of RECs that are of the latest vintage as recorded by PJM EIS GATS or M-RETS for such Delivery Year. Surplus RECs are tracked in the Surplus REC Account and shall remain in such account until a reduction in such Surplus RECs are recorded by the IPA or its designee to meet a Delivery Year Shortfall Amount; With respect to a Designated System that has been Energized and three (3) full Delivery Years has occurred since the start of the Delivery Term of such Designated System, in the event that the Delivery Year REC Performance is less than the Delivery Year Expected REC Quantity, the difference in the number amount of RECs REC quantities shall be the “Delivery Year Shortfall Amount”;
(iv) ” For each Designated System that has a Delivery Year Shortfall Amount, starting with the Designated System with the lowest Contract Price, Surplus RECs from the Surplus REC Account shall be reduced and allocated to meet such Delivery Year Shortfall Amount, REC for REC. If there are insufficient Surplus RECs to meet the Delivery Year Shortfall Amount, then the number amount of RECs REC quantity calculated as the difference between the Delivery Year Shortfall Amount and the sum of such Surplus RECs being applied to meet the Delivery Year Shortfall Amount is the “Drawdown REC Quantity”, and the multiplicative product of the Drawdown REC Quantity and the Contract Price of such Designated System is the “Drawdown Payment”; and
(v) and At the end of the foregoing process:
(1) : Buyer shall draw on Seller’s Performance Assurance in the amount of the Aggregate Drawdown Payment. Seller shall be required to replenish Seller’s Performance Assurance in accordance with Section 4.3 of the Master REC Agreementas provided herein. If Seller’s Performance Assurance is less than the Aggregate Drawdown Payment, then Seller shall pay Buyer the difference within fifteen
ten (1510) Business Days of notice by Buyer. Failure by Seller to pay Buyer shall be an Event of Default subject to the Termination remedies under this REC Contract Notwithstanding the foregoing, if this is not the last Delivery Year under this REC Contract Contract; and the amount of the Aggregate Drawdown Payment is less than $5,000, then Buyer shall not draw on Seller’s Performance Assurance, but will track such amount and add such amount to the Aggregate Drawdown Payment for the subsequent Delivery Year or Delivery Years until the earlier of: the last Delivery Year or such time when the Aggregate Drawdown Payment is at least $5,000;
(2) For purposes of calculating the Delivery Year REC Performance in the future Delivery Yearsyears, each Designated System that has a Delivery Year Shortfall Amount for which such Delivery Year Shortfall Amount is covered by Surplus REC(s) RECs and/or for which a payment from Seller or from Seller’s Performance Assurance has been applied to the Drawdown REC Quantity, such Designated System is deemed to have Delivered REC quantities equal to the Delivery Year Expected REC Quantity in such Delivery Year.
(e) . If a Designated System is a Community Renewable Energy Generation Project, such Designated System must maintain at least the Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed as provided in the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet throughout the remainder of the Delivery Term after the issuance first year of such Community Solar Quarterly Reportoperations. Failure to maintain the Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed as provided in the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet in a Delivery Year shall result in payment to Buyer from Seller of a monetary amount, determined by the IPA or its designee, and Buyer may draw on Seller’s Performance Assurance for this purpose. For each Delivery Year after the issuance of the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet, the subscription percentage and Community Solar Subscription Mix will each be calculated as a daily average, then averaged over the Delivery Year, based on actual subscription start and end dates entered in the REC Annual Report. The draw on Seller’s Performance Assurance will be calculated as the difference between (a) the contracted payment for that Delivery Year and (b) the amount that would have been paid given the realized Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed, if (a) exceeds (b). This amount will be calculated in arrears for only the immediately preceding Delivery Year covered by the REC Annual Report. If the Designated System regains a Community Solar Subscription mix and subscription percentage at or above their contracted amount in subsequent years, a drawdown will not occur in those years; however, overperformance in a Delivery Year will not be banked or applied to past Delivery Years. Designated Systems with subscription levels above 90% of Actual Nameplate Capacity on a kW capacity basis for a Delivery Year will not be subject to a draw on Seller’s Performance Assurance for that Delivery Year on the basis of subscription percentage. This calculation will only occur after the final Contract Price and quantity of RECs due payment are determined per section 5(e)(iv)(D) of the Cover Sheet and will be based on that final Contract Price and quantity which is determined by the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet.
(f) During the Delivery Term, Seller may determine that a Designated System is not performing at the level expected. In such case, Seller may submit a request to Buyer and the IPA (or its designee) to have the Delivery obligations of such Designated System reduced, and if the request is accepted by Buyer, such request shall be reduced in exchange for the return by Seller to Buyer of an agreed upon payment adjustment if payment has been made by Buyer for RECs from such Designated System. Such request shall include pertinent information related to the payment adjustment as well as requested changes to future Delivery Year Expected REC Quantity and Contract Nameplate Capacity. Any such request shall be deemed approved upon Buyer’s receipt of such agreed upon payment adjustment, and information regarding the receipt of and the calculation of the agreed upon payment adjustment shall be communicated to the IPA and its designee. Any such changes in the delivery schedule and adjustments made to future Delivery Year Expected REC Quantity and Contract Nameplate Capacity shall be documented in an amended Schedule B to the Product Order applicable to such Designated System issued by the IPA or its designee to Buyer and Seller.
(g) Surplus RECs are virtually tracked in the Surplus REC Account and shall remain, except as provided in Section 9.2 of the Master REC Agreement, in such account until a reduction in such Surplus RECs is recorded by the IPA or its designee to meet a Delivery Year Shortfall Amount.
(h) Upon the conclusion of the annual review process pursuant to Section 6(d) above for the last Delivery Year under this REC Contract, if (i) there are Surplus RECs remaining in the Surplus REC Account and (ii) an Aggregate Drawdown Payment has occurred during the Term of this REC Contract, then the IPA or its designee shall calculate a monetary refund adjustment due to Seller from Buyer. Buyer shall credit Seller for each Surplus REC that can be applied to a REC associated with a Drawdown Payment. For purpose of calculating the refund, Surplus RECs from the Surplus REC Account shall be reduced and applied to the RECs that are associated with a Drawdown Payment, starting with the REC with the lowest Contract Price, REC for REC. The monetary refund adjustment shall be paid from Buyer to Seller by December 31 following the conclusion of the last annual review process. For avoidance of doubt, no payment shall be made for any Surplus RECs that remain in the Surplus REC Account after the refund adjustment is calculated.
Appears in 1 contract
Sources: Renewable Energy Credit Agreement
Deliveries and Quantity. (a) For each Designated System that has been Energized, the Delivery of at least one (1) REC from such Designated System is expected to occur to the Buyer’s PJM-EIS GATS account or M-RETS account, as applicable, within 90 calendar days of when such Designated System was Energized if the Actual Contract Nameplate Capacity of such Designated System is greater than 5kW or within 180 calendar days of when the Designated System was Energized if the Actual Contract Nameplate Capacity of such Designated System is equal to or less than 5kW. For each Designated System that fails to Deliver at least (1) one REC from such Designated System by the applicable deadlineSystem, Seller must provide to Buyer and the IPA or its designee, with respect to such Designated System, a written notice within sixty thirty (6030) days of the applicable deadline to Deliver at least one (1) REC confirming that there are no technical issues, with respect to such Designated System, known to Seller that would impede the generation, issuance and Delivery of RECs from such Designated System or that such technical issues have has been resolved by Seller. In the event that Seller fails to provide such written notice within sixty (60) days of the applicable deadline to Deliver at least one (1) REC, then the number of RECs associated with such Designated System shall be deemed removed from this REC Contract and Buyer shall be entitled to payment by Seller in the amount of the greater of: (i) the Collateral Requirement for such Designated System or (ii) one hundred percent (100%) of the total payments Seller has received from Buyer associated with RECs from such Designated System.;
(b) For each Designated System that has been Energized, all RECs designated to be Delivered pursuant to the Standing Order associated with such Designated System shall be Delivered to Buyer commencing from the date such Standing Order is established through the end of the Delivery Term of such Designated System regardless of whether the total payment made by Buyer to Seller for RECs from such Designated System is commensurate with the actual number of RECs Delivered from such Designated System.;
(c) For each Designated System that has been Energized, a REC delivery schedule is provided in Schedule B to the associated Product Order applicable to such Designated System that contains the expected number of RECs to be Delivered through the end of the Delivery Term where the number of RECs expected to be Delivered in each Delivery Year is based on the Designated System applicable Capacity Factor, Contract Maximum REC Quantity Nameplate Capacity and a degradation factor of half of one percent (0.5%) annually, and rounded down to the nearest whole REC in each Delivery YearREC. The REC quantities expected to be Delivered from such Designated System in a Delivery Year shall be the “Delivery Year Expected REC Quantity” for such Delivery Year. For avoidance of doubt, with respect to a Designated System, the Delivery Year Expected REC Quantities in the delivery schedule are determined at the time of Energization and not when the Delivery Term starts. As such, for purposes of calculating the Delivery Year Expected REC Quantity for each Delivery Year, the Delivery Year in which the date of Energization occurred shall be the first Delivery Year for which a Delivery Year Expected REC Quantity is calculated and the Delivery Year Expected REC Quantity for such first Delivery Year shall reflect an annualized number based on allocating the Designated System Contract Maximum REC Quantity across 15 years using a degradation factor of half of one percent (0.5%) annually. If the Delivery Term extends beyond a 15-Delivery Year schedule starting with that first Delivery Year, then each subsequent Delivery Year Expected REC Quantity subsequent to the 15th Delivery Year shall reflect a quantity that provides for a degradation factor of half of one percent (0.5%) from the prior Delivery Year Expected REC Quantity (a sample delivery schedule Delivery Schedule is provided in Exhibit F).;
(d) Once annually on or prior to November 15 following a Delivery Year, the IPA or its designee shall review the performance of the REC deliveries made during such Delivery Year and determine the amount of Aggregate Drawdown Payment payment due as follows:
(i) For each Designated System that has been Energized and three (3) full Delivery Years has occurred since the start of the Delivery Term of such Designated SystemEnergized, the IPA or its designee shall calculate, with respect to a Delivery Year, a Delivery Year REC Performance for such Delivery Year (an example Delivery Year REC Performance calculation is provided in Exhibit G);
(ii) With respect to a Designated System that has been Energized and three (3) full Delivery Years has occurred since the start of the Delivery Term of such Designated System, in the event that the Delivery Year REC Performance is greater than the applicable Delivery Year Expected REC Quantity, the difference in the number amount of RECs REC quantities shall be the “Delivery Year Surplus Amount” [Commenter 7 Note: Although “Delivery Year Surplus Amount” is defined here, we suggest adding it to the list of definitions for ease of reference. ] and each REC included issued in the Delivery Year Surplus Amount excess shall be a “Surplus REC”;
(iii) With respect to a Designated System . For avoidance of doubt, RECs that has been Energized and three (3) full Delivery Years has occurred since the start of the Delivery Term of such Designated System, are issued later in the event that the Delivery Year REC Performance is less than are to be considered first as Surplus RECs ahead of RECs issued earlier in the Delivery Year Expected REC Quantity, if the difference in Delivery Year Surplus Amount exceeds the number of RECs shall be the “Delivery Year Shortfall Amount”;
(iv) For each Designated System that has a Delivery Year Shortfall Amount, starting with the Designated System with the lowest Contract Price, Surplus RECs from the Surplus REC Account shall be reduced and allocated to meet such Delivery Year Shortfall Amount, REC for REC. If there are insufficient Surplus RECs to meet the Delivery Year Shortfall Amount, then the number of RECs calculated as the difference between the Delivery Year Shortfall Amount and the sum of such Surplus RECs being applied to meet the Delivery Year Shortfall Amount is the “Drawdown REC Quantity”, and the multiplicative product of the Drawdown REC Quantity and the Contract Price of such Designated System is the “Drawdown Payment”; and
(v) At the end of the foregoing process:
(1) Buyer shall draw on Seller’s Performance Assurance in the amount of the Aggregate Drawdown Payment. Seller shall be required to replenish Seller’s Performance Assurance in accordance with Section 4.3 of the Master REC Agreement. If Seller’s Performance Assurance is less than the Aggregate Drawdown Payment, then Seller shall pay Buyer the difference within fifteen
(15) Business Days of notice latest vintage as recorded by Buyer. Failure by Seller to pay Buyer shall be an Event of Default subject to the Termination remedies under this REC Contract Notwithstanding the foregoing, if this is not the last Delivery Year under this REC Contract and the amount of the Aggregate Drawdown Payment is less than $5,000, then Buyer shall not draw on Seller’s Performance Assurance, but will track such amount and add such amount to the Aggregate Drawdown Payment PJM EIS GATS or M-RETS for the subsequent Delivery Year or Delivery Years until the earlier of: the last Delivery Year or such time when the Aggregate Drawdown Payment is at least $5,000;
(2) For purposes of calculating the Delivery Year REC Performance in future Delivery Years, each Designated System that has a Delivery Year Shortfall Amount for which such Delivery Year Shortfall Amount is covered by Surplus REC(s) and/or for which a payment from Seller or from Seller’s Performance Assurance has been applied to the Drawdown REC Quantity, such Designated System is deemed to have Delivered REC quantities equal to the Delivery Year Expected REC Quantity in such Delivery Year.
(e) If a Designated System is a Community Renewable Energy Generation Project, such Designated System must maintain at least the Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed as provided in the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet throughout the remainder of the Delivery Term after the issuance of such Community Solar Quarterly Report. Failure to maintain the Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed as provided in the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet in a Delivery Year shall result in payment to Buyer from Seller of a monetary amount, determined by the IPA or its designee, and Buyer may draw on Seller’s Performance Assurance for this purpose. For each Delivery Year after the issuance of the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet, the subscription percentage and Community Solar Subscription Mix will each be calculated as a daily average, then averaged over the Delivery Year, based on actual subscription start and end dates entered in the REC Annual Report. The draw on Seller’s Performance Assurance will be calculated as the difference between (a) the contracted payment for that Delivery Year and (b) the amount that would have been paid given the realized Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed, if (a) exceeds (b). This amount will be calculated in arrears for only the immediately preceding Delivery Year covered by the REC Annual Report. If the Designated System regains a Community Solar Subscription mix and subscription percentage at or above their contracted amount in subsequent years, a drawdown will not occur in those years; however, overperformance in a Delivery Year will not be banked or applied to past Delivery Years. Designated Systems with subscription levels above 90% of Actual Nameplate Capacity on a kW capacity basis for a Delivery Year will not be subject to a draw on Seller’s Performance Assurance for that Delivery Year on the basis of subscription percentage. This calculation will only occur after the final Contract Price and quantity of RECs due payment are determined per section 5(e)(iv)(D) of the Cover Sheet and will be based on that final Contract Price and quantity which is determined by the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet.
(f) During the Delivery Term, Seller may determine that a Designated System is not performing at the level expected. In such case, Seller may submit a request to Buyer and the IPA (or its designee) to have the Delivery obligations of such Designated System reduced, and if the request is accepted by Buyer, such request shall be in exchange for the return by Seller to Buyer of an agreed upon payment adjustment if payment has been made by Buyer for RECs from such Designated System. Such request shall include pertinent information related to the payment adjustment as well as requested changes to future Delivery Year Expected REC Quantity and Contract Nameplate Capacity. Any such request shall be deemed approved upon Buyer’s receipt of such agreed upon payment adjustment, and information regarding the receipt of and the calculation of the agreed upon payment adjustment shall be communicated to the IPA and its designee. Any such changes in the delivery schedule and adjustments made to future Delivery Year Expected REC Quantity and Contract Nameplate Capacity shall be documented in an amended Schedule B to the Product Order applicable to such Designated System issued by the IPA or its designee to Buyer and Seller.
(g) Surplus RECs are virtually tracked in the Surplus REC Account and shall remain, except as provided in Section 9.2 of the Master REC Agreement, remain in such account until a reduction in such Surplus RECs is are recorded by the IPA or its designee to meet a Delivery Year Shortfall Amount.
(h) Upon the conclusion of the annual review process pursuant to Section 6(d) above for the last Delivery Year under this REC Contract, if (i) there are Surplus RECs remaining in the Surplus REC Account and (ii) an Aggregate Drawdown Payment has occurred during the Term of this REC Contract, then the IPA or its designee shall calculate a monetary refund adjustment due to Seller from Buyer. Buyer shall credit Seller for each Surplus REC that can be applied to a REC associated with a Drawdown Payment. For purpose of calculating the refund, Surplus RECs from the Surplus REC Account shall be reduced and applied to the RECs that are associated with a Drawdown Payment, starting with the REC with the lowest Contract Price, REC for REC. The monetary refund adjustment shall be paid from Buyer to Seller by December 31 following the conclusion of the last annual review process. For avoidance of doubt, no payment shall be made for any Surplus RECs that remain in the Surplus REC Account after the refund adjustment is calculated.;
Appears in 1 contract
Sources: Renewable Energy Credit Agreement
Deliveries and Quantity. (a) For each Designated System that has been Energized, the Delivery of at least one (1) REC from such Designated System is expected to occur to the Buyer’s PJM-EIS GATS account or M-RETS account, as applicable, within 90 calendar ninety (90) days of when such Designated System was Energized if the Actual Nameplate Capacity of such Designated System is greater than 5kW or within 180 calendar one hundred eighty (180) days of when the Designated System was Energized if the Actual Nameplate Capacity of such Designated System is equal to or less than 5kW. For each Designated System that fails to Deliver at least (1) one REC from such Designated System by the applicable deadline, Seller must provide to Buyer and the IPA or its designee, with respect to such Designated System, a written notice within sixty (60) days of the applicable deadline to Deliver at least one one
(1) REC confirming that there are no technical issues, with respect to such Designated System, known to Seller that would impede the generation, issuance and Delivery of RECs from such Designated System or that such technical issues have been resolved by Seller. In the event that Seller fails to provide such written notice within sixty (60) days of the applicable deadline to Deliver at least one (1) REC, then the number of Designated System and the RECs associated with such Designated System shall be deemed removed from this REC Contract Contract. As soon as practicable after the occurrence of such failure by Seller, the IPA shall provide to Buyer and Seller a revised Schedule A, Schedule B, and Schedule C to the Product Order for such Designated System indicating the removal of such Designated System from the REC Contract. Upon the occurrence of such failure, Buyer shall be entitled to payment by Seller in the amount of the greater of: (i) the Collateral Requirement for such Designated System or (ii) one hundred percent (100%) of the total payments Seller has received from Buyer associated with RECs from such Designated System.
(b) For each Designated System that has been Energized, all RECs designated to be Delivered pursuant to the Standing Order associated with such Designated System shall be Delivered to Buyer commencing from the date such Standing Order is established through the end of the Delivery Term of such Designated System regardless of whether the total payment made by Buyer to Seller for RECs from such Designated System is commensurate with the actual number of RECs Delivered from such Designated System.
(c) For each Designated System that has been Energized, a REC delivery schedule is provided in Schedule B to the Product Order applicable to such Designated System that contains the expected number of RECs to be Delivered through the end of the Delivery Term where the number of RECs expected to be Delivered in each Delivery Year is based on the Designated System Contract Maximum REC Quantity and a degradation factor of half of one percent (0.5%) annually, and rounded down to the nearest whole REC in each Delivery Year. The REC quantities expected to be Delivered from such Designated System in a Delivery Year shall be the “Delivery Year Expected REC Quantity” for such Delivery Year. For avoidance of doubt, with respect to a Designated System, the Delivery Year Expected REC Quantities in the delivery schedule are determined at the time of Energization and not when the Delivery Term starts. As such, for purposes of calculating the Delivery Year Expected REC Quantity for each Delivery Year, the Delivery Year in which the date of Energization occurred shall be the first Delivery Year for which a Delivery Year Expected REC Quantity is calculated and the Delivery Year Expected REC Quantity for such first Delivery Year shall reflect an annualized number based on allocating the Designated System Contract Maximum REC Quantity across 15 years using a degradation factor of half of one percent (0.5%) annually. If the Delivery Term extends beyond a 15-Delivery Year schedule starting with that first Delivery Year, then each subsequent Delivery Year Expected REC Quantity subsequent to the 15th Delivery Year shall reflect a quantity that provides for a degradation factor of half of one percent (0.5%) from the prior Delivery Year Expected REC Quantity (a sample delivery schedule is provided in Exhibit F).
(d) Once annually on or prior to November 15 following a Delivery Year, the IPA or its designee shall review the performance of the REC deliveries made during such Delivery Year Year, using information provided in the REC Annual Report submitted pursuant to Section 10(c) of the Cover Sheet, and determine the amount of Aggregate Drawdown Payment due as follows:
(i) For each Designated System that has been Energized and three (3) full Delivery Years has occurred since the start of the Delivery Term of such Designated System, the IPA or its designee shall calculate, with respect to a Delivery Year, a Delivery Year REC Performance for such Delivery Year (an example Delivery Year REC Performance calculation is provided in Exhibit G);
(ii) With respect to a Designated System that has been Energized and three (3) full Delivery Years has occurred since the start of the Delivery Term of such Designated System, in the event that the Delivery Year REC Performance is greater than the applicable Delivery Year Expected REC Quantity, the difference in the number of RECs shall be the “Delivery Year Surplus Amount” and each REC included in the Delivery Year Surplus Amount shall be a “Surplus REC”;
(iii) With respect to a Designated System that has been Energized and three (3) full Delivery Years has occurred since the start of the Delivery Term of such Designated System, in the event that the Delivery Year REC Performance is less than the Delivery Year Expected REC Quantity, the difference in the number of RECs shall be the “Delivery Year Shortfall Amount”;
(iv) For each Designated System that has a Delivery Year Shortfall Amount, starting with the Designated System with the lowest Contract Price, Surplus RECs from the Surplus REC Account shall be reduced and allocated to meet such Delivery Year Shortfall Amount, REC for REC. If there are insufficient Surplus RECs to meet the Delivery Year Shortfall Amount, then the number of RECs calculated as the difference between the Delivery Year Shortfall Amount and the sum of such Surplus RECs being applied to meet the Delivery Year Shortfall Amount is the “Drawdown REC Quantity”, and the multiplicative product of the Drawdown REC Quantity and the Contract Price of such Designated System is the “Drawdown Payment”; and
(v) At the end of the foregoing process:
(1) Buyer shall inform Seller of the Aggregate Drawdown Payment (including any Drawdown Payment pursuant to Section 6(d)(iv) of the Cover Sheet and any Drawdown Payment pursuant to Section 6(e) of the Cover Sheet) by written notice and Seller may, within five (5) Business Days of such written notice, request for payment of the Aggregate Drawdown Payment to be made by additional cash transfer by Seller to Buyer or request for the payment of the Aggregate Drawdown Payment to be made from the cash or the Letter of Credit held as Seller’s Performance Assurance if both cash and a Letter of Credit are held as Seller’s Performance Assurance. If Buyer does not receive such request from Seller within such five (5) Business Day period, or if Seller makes a request within the five (5) Business Day period to pay with cash and then fails to remit the full cash payment by the fourteenth (14th) Business Day after Buyer’s written notice to Seller, Buyer shall draw on Seller’s Performance Assurance to reach the full amount of the Aggregate Drawdown Payment. If Buyer does receive such request from Seller for a draw on a particular form of Performance Assurance within such five (5) Business Day period, then Buyer shall draw on Seller’s Performance Assurance in the amount form requested. In all cases of a draw on Performance Assurance, the Aggregate Drawdown Paymentdraw shall be made on or after the fifteenth (15th) Business Day after Buyer’s written notice to Seller. Seller shall be required to replenish Seller’s Performance Assurance in accordance with Section 4.3 of the Master REC Agreement. If Seller’s Performance Assurance is less than the Aggregate Drawdown Payment, or if Seller has requested to make such payments by additional cash transfer, then Seller shall pay Buyer the difference or the amount of such payments, respectively, within fifteen
fifteen (15) Business Days of notice by Buyer. Failure by Seller to pay Buyer shall be an Event of Default subject to the Termination remedies under this REC Contract Contract. Notwithstanding the foregoing, if this is not the last Delivery Year under this REC Contract and the amount of the Aggregate Drawdown Payment is less than $5,000, then Buyer shall not draw on Seller’s Performance Assurance, but will track such amount and add such amount to the Aggregate Drawdown Payment for the subsequent Delivery Year or Delivery Years until the earlier of: the last Delivery Year or such time when the Aggregate Drawdown Payment is at least $5,000;
(2) For purposes of calculating the Delivery Year REC Performance in future Delivery Years, each Designated System that has a Delivery Year Shortfall Amount for which such Delivery Year Shortfall Amount is covered by Surplus REC(s) and/or for which a payment from Seller or from Seller’s Performance Assurance has been applied to the Drawdown REC Quantity, such Designated System is deemed to have Delivered REC quantities equal to the Delivery Year Expected REC Quantity in such Delivery Year.
(e) If a Designated System is a Community Renewable Energy Generation Project, such Designated System must maintain at least the Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed as provided in the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet throughout the remainder of the Delivery Term after the issuance of such Community Solar Quarterly Report. Failure to maintain the Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed as provided in the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet in a Delivery Year shall result in payment to Buyer from Seller of a monetary amount, determined by the IPA or its designee, and Buyer may draw on Seller’s Performance Assurance for this purpose. For the purposes of Community Solar Subscription Mix, the Designated System must maintain the percentage mix required under the ABP for the REC price adder obtained in the Contract Price that resulted from the Community Solar Subscription Mix indicated in the last Community Solar Quarterly Report. For each Delivery Year after the issuance of the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet, then, using the Annual Report submitted under Section 10(c) of the Cover Sheet and at the same time as the calculations made under Section 6(d) of the Cover Sheet: the subscription percentage and Community Solar Subscription Mix will each be calculated by the IPA as a daily average, then averaged over the Delivery Year, . This daily average will be based on actual subscription start and end dates comprised of the day a subscription start or end request was submitted to the utility, as entered in the REC Annual Report. The draw on Seller’s Performance Assurance will be calculated as the difference between (a) the contracted payment for that Delivery Year and (b) the amount that would have been paid given the realized Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed, if (a) exceeds (b). This amount will be calculated in arrears for only the immediately preceding Delivery Year covered by the REC Annual Report. If the Designated System regains a Community Solar Subscription mix and subscription percentage at or above their contracted amount in subsequent years, a drawdown will not occur in those years; however, overperformance in a Delivery Year will not be banked or applied to past Delivery Years. Designated Systems with subscription levels above 90% of Actual Nameplate Capacity on a kW capacity basis for a Delivery Year will not be subject to a draw on Seller’s Performance Assurance for that Delivery Year on the basis of subscription percentage. This calculation will only occur after the final Contract Price and quantity of RECs due payment are determined per section 5(e)(iv)(D) of the Cover Sheet and will be based on that final Contract Price and quantity which is determined by the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet.
(f) During the Delivery Term, Seller may determine that a Designated System is not performing at the level expected. In such case, Seller may submit a request to Buyer and the IPA (or its designee) to have the Delivery obligations of such Designated System reduced, and if the request is accepted by Buyer, such request shall be in exchange for the return by Seller to Buyer of an agreed upon payment adjustment if payment has been made by Buyer for RECs from such Designated System. Such request shall include pertinent information related to the payment adjustment as well as requested changes to future Delivery Year Expected REC Quantity and Contract Nameplate Capacity. Any such request shall be deemed approved upon Buyer’s receipt of such agreed upon payment adjustment, and information regarding the receipt of and the calculation of the agreed upon payment adjustment shall be communicated to the IPA and its designee. Any such changes in the delivery schedule and adjustments made to future Delivery Year Expected REC Quantity and Contract Nameplate Capacity shall be documented in an amended Schedule B to the Product Order applicable to such Designated System issued by the IPA or its designee to Buyer and Seller.
(g) Surplus RECs are virtually tracked in the Surplus REC Account and shall remain, except as provided in Section 9.2 of the Master REC Agreement, in such account until a reduction in such Surplus RECs is recorded by the IPA or its designee to meet a Delivery Year Shortfall Amount.
(h) Upon the conclusion of the annual review process pursuant to Section 6(d) above for the last Delivery Year under this REC Contract, if (i) there are Surplus RECs remaining in the Surplus REC Account and (ii) an Aggregate Drawdown Payment has occurred during the Term of this REC Contract, then the IPA or its designee shall calculate a monetary refund adjustment due to Seller from Buyer. Buyer shall credit Seller for each Surplus REC that can be applied to a REC associated with a Drawdown Payment. For purpose of calculating the refund, Surplus RECs from the Surplus REC Account shall be reduced and applied to the RECs that are associated with a Drawdown Payment, starting with the REC with the lowest Contract Price, REC for REC. The monetary refund adjustment shall be paid from Buyer to Seller by December 31 following the conclusion of the last annual review process. For avoidance of doubt, no payment shall be made for any Surplus RECs that remain in the Surplus REC Account after the refund adjustment is calculated.the
Appears in 1 contract
Sources: Renewable Energy Credit Agreement
Deliveries and Quantity. (a) Seller will Deliver the quantity of each Product specified in Table 1 and Buyer will pay the specified Purchase Price for such Product, all in accordance with this REC Contract. RECs generated from the Small Size Class cannot be substituted for RECs from the Large Size Class (and vice versa). For each Designated System that has been EnergizedDelivery Year, except as set forth in Section 4(d), the RECs must be generated between the applicable dates specified in Table 1 (all such required generation dates referred to as the “Vintage”) and must be Delivered on or before the Delivery of at least one Date for the Spring Delivery Season for such Delivery Year.
(1b) REC from such Designated System is expected Notwithstanding the foregoing, for the first Delivery Year only, Seller shall provide written notification to occur Buyer with each invoice (with a copy provided to the Buyer’s IPA) regarding whether Seller has completed the registration process in PJM-EIS GATS account or M-RETS account, as applicable, within 90 calendar days of when such Designated System was Energized if the Actual Nameplate Capacity of such Designated System is greater than 5kW or within 180 calendar days of when the Designated System was Energized if the Actual Nameplate Capacity of such Designated System is equal to or less than 5kW. For for each Designated System such that fails to Deliver at least (1) one REC from such Designated System by the applicable deadlineinitial meter read date as recorded in PJM-GATS or M-RETS occurs on or before May 31, Seller must provide to Buyer and the IPA or its designee, with respect to such Designated System, a written notice within sixty (60) days of the applicable deadline to Deliver at least one (1) REC confirming that there are no technical issues, with respect to such Designated System, known to Seller that would impede the generation, issuance and Delivery of RECs from such Designated System or that such technical issues have been resolved by Seller2017. In the event that (i) Seller fails to provide such written notice within sixty complete the registration process in PJM-GATS or M-RETS for a Designated System by the time the last invoice for the first Delivery Year is submitted or (60ii) days of the applicable deadline to Deliver at least one (1) RECinitial meter read date for a Designated System as recorded in PJM-GATS or M-RETS occurs after May 31, then the number of RECs associated with 2017, such Designated System shall will be deemed removed from this REC Contract and Buyer the Delivery Year Quantity of RECs specified in Table 1 shall be entitled to payment reduced by Seller in the amount of the greater of: (i) the Collateral Requirement for such Designated System or (ii) one hundred percent (100%) of the total payments Seller has received from Buyer RECs associated with RECs from such Designated System.
(b) For each Designated System that has been Energized, all RECs designated to be Delivered pursuant to the Standing Order associated with such Designated System shall be Delivered to Buyer commencing from the date such Standing Order is established through the end of the Delivery Term of such Designated System regardless of whether the total payment made by Buyer to Seller for RECs from such Designated System is commensurate with the actual number of RECs Delivered from such Designated System.
(c) For The following shall constitute an Event of Default: (i) Seller’s failure to Deliver eighty percent (80%) of the separate Delivery Year Quantity for each Designated System that has been Energized, a REC delivery schedule of the Size Classes by the Delivery Date for the Spring Delivery Season or (ii) if the separate Delivery Year Quantity for one of the Size Classes is provided in Schedule B to less than ten percent (10%) of the Product Order applicable to such Designated System that contains the expected number of RECs to be Delivered through the end sum of the Delivery Term where Year Quantities for both Size Classes for such Delivery Year or if the number sum of RECs expected to be Delivered in each the Delivery Year Quantities for both Size Classes for such Delivery Year is based on the Designated System Contract Maximum REC Quantity and a degradation factor of half of one less than 100 RECs, Seller’s failure to Deliver eighty percent (0.580%) annually, and rounded down to of the nearest whole REC in each Delivery Year. The REC quantities expected to be Delivered from such Designated System in a sum of the Delivery Year shall be the “Delivery Year Expected REC Quantity” Quantities for both Size Classes for such Delivery Year. For avoidance of doubt, with respect to a Designated System, Year by the Delivery Year Expected REC Quantities Date for the Spring Delivery Season; in the delivery schedule are determined at the time of Energization and not when the Delivery Term starts. As sucheach case, for purposes of calculating the as any such Delivery Year Expected REC Quantity for each Delivery Year, the Delivery Year in which the date of Energization occurred shall may be the first Delivery Year for which a Delivery Year Expected REC Quantity is calculated and the Delivery Year Expected REC Quantity for such first Delivery Year shall reflect an annualized number based on allocating the Designated System Contract Maximum REC Quantity across 15 years using a degradation factor of half of one percent (0.5%) annually. If the Delivery Term extends beyond a 15-Delivery Year schedule starting with that first Delivery Year, then each subsequent Delivery Year Expected REC Quantity subsequent reduced pursuant to the 15th Delivery Year shall reflect a quantity that provides for a degradation factor of half of one percent (0.5%) from the prior Delivery Year Expected REC Quantity (a sample delivery schedule is provided in Exhibit FSection 4(b).
(d) Once annually on or prior to November 15 following a For each Delivery Year, Buyer shall pay Seller for Product up to the IPA or its designee shall review the performance of the REC deliveries made during such Delivery Year and determine the amount of Aggregate Drawdown Payment due as follows:
(i) For each Designated System Quantity for such Product. Any RECs Delivered in a Delivery Year that has been Energized and three (3) full Delivery Years has occurred since the start are in excess of the Delivery Term of such Designated System, the IPA or its designee shall calculate, with respect Year Quantity may be used to a Delivery Year, a Delivery Year REC Performance for such Delivery Year (an example Delivery Year REC Performance calculation is provided in Exhibit G);
(ii) With respect to a Designated System that has been Energized and three (3) full Delivery Years has occurred since the start of the Delivery Term of such Designated System, in the event that satisfy the Delivery Year REC Performance is greater than the applicable Delivery Year Expected REC Quantity, the difference in the number of RECs shall be the “Delivery Year Surplus Amount” and each REC included in the Delivery Year Surplus Amount shall be a “Surplus REC”;
(iii) With respect to a Designated System that has been Energized and three (3) full Delivery Years has occurred since the start of the Delivery Term of such Designated System, in the event that the Delivery Year REC Performance is less than the Delivery Year Expected REC Quantity, the difference in the number of RECs shall be the “Delivery Year Shortfall Amount”;
(iv) For each Designated System that has a Delivery Year Shortfall Amount, starting with the Designated System with the lowest Contract Price, Surplus RECs from the Surplus REC Account shall be reduced and allocated to meet such Delivery Year Shortfall Amount, REC for REC. If there are insufficient Surplus RECs to meet the Delivery Year Shortfall Amount, then the number of RECs calculated as the difference between the Delivery Year Shortfall Amount and the sum of such Surplus RECs being applied to meet the Delivery Year Shortfall Amount is the “Drawdown REC Quantity”, and the multiplicative product of the Drawdown REC Quantity and the Contract Price of such Designated System is the “Drawdown Payment”; and
(v) At the end of the foregoing process:
(1) Buyer shall draw on Seller’s Performance Assurance in the amount of the Aggregate Drawdown Payment. Seller shall be required to replenish Seller’s Performance Assurance in accordance with Section 4.3 of the Master REC Agreement. If Seller’s Performance Assurance is less than the Aggregate Drawdown Payment, then Seller shall pay Buyer the difference within fifteen
(15) Business Days of notice by Buyer. Failure by Seller to pay Buyer shall be an Event of Default subject to the Termination remedies under this REC Contract Notwithstanding the foregoing, if this is not the last Delivery Year under this REC Contract and the amount of the Aggregate Drawdown Payment is less than $5,000, then Buyer shall not draw on Seller’s Performance Assurance, but will track such amount and add such amount to the Aggregate Drawdown Payment for the subsequent Delivery Year or Delivery Years until the earlier of: the last Year. June 2016 through May 2017 [______] [______] June 1, 2016 and May 31, 2017 June 2017 through May 2018 [______] [______] June 1, 2017 and May 31, 2018 June 2018 through May 2019 [______] [______] June 1, 2018 and May 31, 2019 June 2019 through May 2020 [______] [______] June 1, 2019 and May 31, 2020 June 2020 through May 2021 [______] [______] June 1, 2020 and May 31, 2021 Purchase Price ($ per REC) [$_______] Delivery Year or such time when the Aggregate Drawdown Payment is at least $5,000;
(2) For purposes of calculating the Delivery Year REC Performance in future Delivery YearsQuantity (# of RECs) Tracking System Vintage June 2016 through May 2017 [______] [______] June 1, each Designated System that has a Delivery Year Shortfall Amount for which such Delivery Year Shortfall Amount is covered by Surplus REC(s) and/or for which a payment from Seller or from Seller’s Performance Assurance has been applied to the Drawdown REC Quantity2016 and May 31, such Designated System is deemed to have Delivered REC quantities equal to the Delivery Year Expected REC Quantity in such Delivery Year.
(e) If a Designated System is a Community Renewable Energy Generation Project2017 June 2017 through May 2018 [______] [______] June 1, such Designated System must maintain at least the Community Solar Subscription Mix 2017 and the percent of Actual Nameplate Capacity that has been subscribed as provided in the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet throughout the remainder of the Delivery Term after the issuance of such Community Solar Quarterly Report. Failure to maintain the Community Solar Subscription Mix May 31, 2018 June 2018 through May 2019 [______] [______] June 1, 2018 and the percent of Actual Nameplate Capacity that has been subscribed as provided in the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet in a Delivery Year shall result in payment to Buyer from Seller of a monetary amountMay 31, determined by the IPA or its designee2019 June 2019 through May 2020 [______] [______] June 1, 2019 and Buyer may draw on Seller’s Performance Assurance for this purpose. For each Delivery Year after the issuance of the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover SheetMay 31, the subscription percentage 2020 June 2020 through May 2021 [______] [______] June 1, 2020 and Community Solar Subscription Mix will each be calculated as a daily averageMay 31, then averaged over the Delivery Year, based on actual subscription start and end dates entered in the REC Annual Report. The draw on Seller’s Performance Assurance will be calculated as the difference between (a) the contracted payment for that Delivery Year and (b) the amount that would have been paid given the realized Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed, if (a) exceeds (b). This amount will be calculated in arrears for only the immediately preceding Delivery Year covered by the REC Annual Report. If the Designated System regains a Community Solar Subscription mix and subscription percentage at or above their contracted amount in subsequent years, a drawdown will not occur in those years; however, overperformance in a Delivery Year will not be banked or applied to past Delivery Years. Designated Systems with subscription levels above 90% of Actual Nameplate Capacity on a kW capacity basis for a Delivery Year will not be subject to a draw on Seller’s Performance Assurance for that Delivery Year on the basis of subscription percentage. This calculation will only occur after the final Contract Price and quantity of RECs due payment are determined per section 5(e)(iv)(D) of the Cover Sheet and will be based on that final Contract Price and quantity which is determined by the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet.
(f) During the Delivery Term, Seller may determine that a Designated System is not performing at the level expected. In such case, Seller may submit a request to Buyer and the IPA (or its designee) to have the Delivery obligations of such Designated System reduced, and if the request is accepted by Buyer, such request shall be in exchange for the return by Seller to Buyer of an agreed upon payment adjustment if payment has been made by Buyer for RECs from such Designated System. Such request shall include pertinent information related to the payment adjustment as well as requested changes to future Delivery Year Expected REC Quantity and Contract Nameplate Capacity. Any such request shall be deemed approved upon Buyer’s receipt of such agreed upon payment adjustment, and information regarding the receipt of and the calculation of the agreed upon payment adjustment shall be communicated to the IPA and its designee. Any such changes in the delivery schedule and adjustments made to future Delivery Year Expected REC Quantity and Contract Nameplate Capacity shall be documented in an amended Schedule B to the Product Order applicable to such Designated System issued by the IPA or its designee to Buyer and Seller.
(g) Surplus RECs are virtually tracked in the Surplus REC Account and shall remain, except as provided in Section 9.2 of the Master REC Agreement, in such account until a reduction in such Surplus RECs is recorded by the IPA or its designee to meet a Delivery Year Shortfall Amount.
(h) Upon the conclusion of the annual review process pursuant to Section 6(d) above for the last Delivery Year under this REC Contract, if (i) there are Surplus RECs remaining in the Surplus REC Account and (ii) an Aggregate Drawdown Payment has occurred during the Term of this REC Contract, then the IPA or its designee shall calculate a monetary refund adjustment due to Seller from Buyer. Buyer shall credit Seller for each Surplus REC that can be applied to a REC associated with a Drawdown Payment. For purpose of calculating the refund, Surplus RECs from the Surplus REC Account shall be reduced and applied to the RECs that are associated with a Drawdown Payment, starting with the REC with the lowest Contract Price, REC for REC. The monetary refund adjustment shall be paid from Buyer to Seller by December 31 following the conclusion of the last annual review process. For avoidance of doubt, no payment shall be made for any Surplus RECs that remain in the Surplus REC Account after the refund adjustment is calculated.2021
Appears in 1 contract
Sources: Renewable Energy Credit Agreement
Deliveries and Quantity. (a) For each Designated System that has been Energized, the Delivery of at least one (1) REC from such Designated System is expected to occur to the Buyer’s PJM-EIS GATS account or M-RETS account, as applicable, within 90 calendar ninety (90) days of when such Designated System was Energized if the Actual Nameplate Capacity of such Designated System is greater than 5kW or within 180 calendar one hundred eighty (180) days of when the Designated System was Energized if the Actual Nameplate Capacity of such Designated System is equal to or less than 5kW. For each Designated System that fails to Deliver at least (1) one REC from such Designated System by the applicable deadline, Seller must provide to Buyer and the IPA or its designeeIPA, with respect to such Designated System, a written notice within sixty (60) days of the applicable deadline to Deliver at least one one
(1) REC confirming that there are no technical issues, with respect to such Designated System, known to Seller that would impede the generation, issuance and Delivery of RECs from such Designated System or that such technical issues have been resolved by Seller. In the event that Seller fails to provide such written notice within sixty (60) days of the applicable deadline to Deliver at least one (1) REC, then the number of Designated System and the RECs associated with such Designated System shall be deemed removed from this REC Contract Contract. As soon as practicable after the occurrence of such failure by Seller, the IPA shall provide to Buyer and Seller a revised Schedule A, Schedule B, and Schedule C to the Product Order for such Designated System indicating the removal of such Designated System from the REC Contract. Upon the occurrence of such failure, Buyer shall be entitled to payment by Seller in the amount of the greater of: (i) the Collateral Requirement for such Designated System or (ii) one hundred percent (100%) of the total payments Seller has received from Buyer associated with RECs from such Designated System.
(b) For each Designated System that has been Energized, all RECs designated to be Delivered pursuant to the Standing Order associated with such Designated System shall be Delivered to Buyer commencing from the date such Standing Order is established through the end of the Delivery Term of such Designated System regardless of whether the total payment made by Buyer to Seller for RECs from such Designated System is commensurate with the actual number of RECs Delivered from such Designated System.
(c) For each Designated System that has been Energized, a REC delivery schedule is provided in Schedule B to the Product Order applicable to such Designated System that contains the expected number of RECs to be Delivered through the end of the Delivery Term where the number of RECs expected to be Delivered in each Delivery Year is based on the Designated System Contract Maximum REC Quantity and a degradation factor of half of one percent (0.5%) annually, and rounded down to the nearest whole REC in each Delivery Year. The REC quantities expected to be Delivered from such Designated System in a Delivery Year shall be the “Delivery Year Expected REC Quantity” for such Delivery Year. For avoidance of doubt, with respect to a Designated System, the Delivery Year Expected REC Quantities in the delivery schedule are determined at the time of Energization and not when the Delivery Term starts. As such, for purposes of calculating the Delivery Year Expected REC Quantity for each Delivery Year, the Delivery Year in which the date of Energization occurred shall be the first Delivery Year for which a Delivery Year Expected REC Quantity is calculated and the Delivery Year Expected REC Quantity for such first Delivery Year shall reflect an annualized number based on allocating the Designated System Contract Maximum REC Quantity across 15 years using a degradation factor of half of one percent (0.5%) annually. If the Delivery Term extends beyond a 15-Delivery Year schedule starting with that first Delivery Year, then each subsequent Delivery Year Expected REC Quantity subsequent to the 15th Delivery Year shall reflect a quantity that provides for a degradation factor of half of one percent (0.5%) from the prior Delivery Year Expected REC Quantity (a sample delivery schedule is provided in Exhibit F).
(d) Once annually on or prior to November 15 following a Delivery Year, the IPA or its designee shall review the performance of the REC deliveries made during such Delivery Year Year, using information provided in the REC Annual Report submitted pursuant to Section 10(c) of the Cover Sheet, and determine the amount of Aggregate Drawdown Payment due as follows:
(i) For each Designated System that has been Energized and three (3) full Delivery Years has hashave occurred since the start of the Delivery Term of such Designated System, the IPA or its designee shall calculate, with respect to a Delivery Year, a Delivery Year REC Performance for such Delivery Year (an example Delivery Year REC Performance calculation is provided in Exhibit G);
(ii) With respect to a Designated System that has been Energized and three (3) full Delivery Years has hashave occurred since the start of the Delivery Term of such Designated System, in the event that the Delivery Year REC Performance is greater than the applicable Delivery Year Expected REC Quantity, the difference in the number of RECs shall be the “Delivery Year Surplus Amount” and each REC included in the Delivery Year Surplus Amount shall be a “Surplus REC”;
(iii) With respect to a Designated System that has been Energized and three (3) full Delivery Years has hashave occurred since the start of the Delivery Term of such Designated System, in the event that the Delivery Year REC Performance is less than the Delivery Year Expected REC Quantity, the difference in the number of RECs shall be the “Delivery Year Shortfall Amount”;
(iv) For each Designated System that has a Delivery Year Shortfall Amount, starting with the Designated System with the lowest Contract Price, Surplus RECs from the Surplus REC Account shall be reduced and allocated to meet such Delivery Year Shortfall Amount, REC for REC. If there are insufficient Surplus RECs to meet the Delivery Year Shortfall Amount, then the number of RECs calculated as the difference between the Delivery Year Shortfall Amount and the sum of such Surplus RECs being applied to meet the Delivery Year Shortfall Amount is the “Drawdown REC Quantity”, and the multiplicative product of the Drawdown REC Quantity and the Contract Price of such Designated System is the “Drawdown Payment”; and
(v) At the end of the foregoing process:
(1) Buyer shall inform Seller of the Aggregate Drawdown Payment (including any Drawdown Payment pursuant to Section 6(d)(iv) of the Cover Sheet and any Drawdown Payment pursuant to Section 6(e) of the Cover Sheet) by written notice and Seller may, within five (5) Business Days of such written notice, request for payment of the Aggregate Drawdown Payment to be made by additional cash transfer by Seller to Buyer or request for the payment of the Aggregate Drawdown Payment to be made from the cash or the Letter of Credit held as Seller’s Performance Assurance if both cash and a Letter of Credit are held as Seller’s Performance Assurance. If Buyer does not receive such request from Seller within such five (5) Business Day period, or if Seller makes a request within the five (5) Business Day period to pay with cash and then fails to remit the full cash payment by the fourteenth (14th) Business Day after Buyer’s written notice to Seller, Buyer shall draw on Seller’s Performance Assurance to reach the full amount of the Aggregate Drawdown Payment. If Buyer does receive such request from Seller for a draw on a particular form of Performance Assurance within such five (5) Business Day period, then Buyer shall draw on Seller’s Performance Assurance in the amount form requested. In all cases of a draw on Performance Assurance, the Aggregate Drawdown Paymentdraw shall be made on or after the fifteenth (15th) Business Day after Buyer’s written notice to Seller. Seller shall be required to replenish Seller’s Performance Assurance in accordance with Section 4.3 of the Master REC Agreement. If Seller’s Performance Assurance is less than the Aggregate Drawdown Payment, or if Seller has requested to make such payments by additional cash transfer, then Seller shall pay Buyer the difference or the amount of such payments, respectively, within fifteen
fifteen (15) Business Days of notice by Buyer. Failure by Seller to pay Buyer shall be an Event of Default subject to the Termination remedies under this REC Contract Contract. Notwithstanding the foregoing, if this is not the last Delivery Year under this REC Contract and the amount of the Aggregate Drawdown Payment is less than $5,000, then Buyer shall not draw on Seller’s Performance Assurance, but will track such amount and add such amount to the Aggregate Drawdown Payment for the subsequent Delivery Year or Delivery Years until the earlier of: the last Delivery Year or such time when the Aggregate Drawdown Payment is at least $5,000;
(2) For purposes of calculating the Delivery Year REC Performance in future Delivery Years, each Designated System that has a Delivery Year Shortfall Amount for which such Delivery Year Shortfall Amount is covered by Surplus REC(s) and/or for which a payment from Seller or from Seller’s Performance Assurance has been applied to the Drawdown REC Quantity, such Designated System is deemed to have Delivered REC quantities equal to the Delivery Year Expected REC Quantity in such Delivery Year.
(e) If a Designated System is a Community Renewable Energy Generation Project, such Designated System must maintain at least the Community Solar Subscription Mix Mix, the percent of Actual Nameplate Capacity that has been subscribed by the Anchor Tenant and the percent of Actual Nameplate Capacity that has been subscribed by End Use Customers as provided in the last Community Solar Quarterly QuarterlyFirst Year Report submitted pursuant to Section 10(b) of the Cover Sheet throughout the remainder of the Delivery Term after the issuance of such Community Solar Quarterly QuarterlyFirst Year Report. Failure to maintain the Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed by the Anchor Tenant and End Use Customers as provided in the last Community Solar Quarterly QuarterlyFirst Year Report submitted pursuant to Section 10(b) of the Cover Sheet in a Delivery Year shall result in payment to Buyer from Seller of a monetary amount, determined by the IPA or its designeeIPA, and Buyer may draw on Seller’s Performance Assurance for this purpose. For the purposes of Community Solar Subscription Mix, theThe Designated System must maintain the percentage mixminimum Community Solar Subscription Mix required under the ABPSFA for the REC price adder obtained in the Non-Anchor Tenant Contract Price that resulted from the Community Solar Subscription Mix indicated in the last Community Solar QuarterlyFirst Year Report.; the Designated System must also maintain the subscription shares of the Anchor Tenant and End Use Customers as indicated in the Community Solar First Year Report. For each Delivery Year after the issuance of the last Community Solar Quarterly QuarterlyFirst Year Report submitted pursuant to Section 10(b) of the Cover Sheet, then, using the REC Annual Report submitted under Section 10(c) of the Cover Sheet and at the same time as the calculations made under Section 6(d) of the Cover Sheet: the subscription percentage and Community Solar Subscription Mix will each be calculated as a daily average, then averaged over the Delivery Year, based on actual subscription start and end dates entered in the REC Annual Report. The draw on Seller’s Performance Assurance will be calculated as the difference between (a) the contracted payment for that Delivery Year and (b) the amount that would have been paid given the realized Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed, if (a) exceeds (b). This amount will be calculated in arrears for only the immediately preceding Delivery Year covered by the REC Annual Report. If the Designated System regains a Community Solar Subscription mix and subscription percentage at or above their contracted amount in subsequent years, a drawdown will not occur in those years; however, overperformance in a Delivery Year will not be banked or applied to past Delivery Years. Designated Systems with subscription levels above 90% of Actual Nameplate Capacity on a kW capacity basis for a Delivery Year will not be subject to a draw on Seller’s Performance Assurance for that Delivery Year on the basis of subscription percentage. This calculation will only occur after the final Contract Price and quantity of RECs due payment are determined per section 5(e)(iv)(D) of the Cover Sheet and will be based on that final Contract Price and quantity which is determined by the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet.
(f) During the Delivery Term, Seller may determine that a Designated System is not performing at the level expected. In such case, Seller may submit a request to Buyer and the IPA (or its designee) to have the Delivery obligations of such Designated System reduced, and if the request is accepted by Buyer, such request shall be in exchange for the return by Seller to Buyer of an agreed upon payment adjustment if payment has been made by Buyer for RECs from such Designated System. Such request shall include pertinent information related to the payment adjustment as well as requested changes to future Delivery Year Expected REC Quantity and Contract Nameplate Capacity. Any such request shall be deemed approved upon Buyer’s receipt of such agreed upon payment adjustment, and information regarding the receipt of and the calculation of the agreed upon payment adjustment shall be communicated to the IPA and its designee. Any such changes in the delivery schedule and adjustments made to future Delivery Year Expected REC Quantity and Contract Nameplate Capacity shall be documented in an amended Schedule B to the Product Order applicable to such Designated System issued by the IPA or its designee to Buyer and Seller.
(g) Surplus RECs are virtually tracked in the Surplus REC Account and shall remain, except as provided in Section 9.2 of the Master REC Agreement, in such account until a reduction in such Surplus RECs is recorded by the IPA or its designee to meet a Delivery Year Shortfall Amount.
(h) Upon the conclusion of the annual review process pursuant to Section 6(d) above for the last Delivery Year under this REC Contract, if (i) there are Surplus RECs remaining in the Surplus REC Account and (ii) an Aggregate Drawdown Payment has occurred during the Term of this REC Contract, then the IPA or its designee shall calculate a monetary refund adjustment due to Seller from Buyer. Buyer shall credit Seller for each Surplus REC that can be applied to a REC associated with a Drawdown Payment. For purpose of calculating the refund, Surplus RECs from the Surplus REC Account shall be reduced and applied to the RECs that are associated with a Drawdown Payment, starting with the REC with the lowest Contract Price, REC for REC. The monetary refund adjustment shall be paid from Buyer to Seller by December 31 following the conclusion of the last annual review process. For avoidance of doubt, no payment shall be made for any Surplus RECs that remain in the Surplus REC Account after the refund adjustment is calculated.the
Appears in 1 contract
Sources: Renewable Energy Credit Agreement
Deliveries and Quantity. (a) For each Designated System that has been Energized, the Delivery of at least one (1) REC from such Designated System is expected to occur to the Buyer’s PJM-EIS GATS account or M-RETS account, as applicable, within ninety (90 calendar calendar) days of when such Designated System was Energized if the Actual Nameplate Capacity of such Designated System is greater than 5kW or within one hundred eighty (180 calendar calendar) days of when the Designated System was Energized if the Actual Nameplate Capacity of such Designated System is equal to or less than 5kW. For each Designated System that fails to Deliver at least (1) one REC from such Designated System by the applicable deadline, Seller must provide to Buyer and the IPA or its designee, with respect to such Designated System, a written notice within sixty (60) days of the applicable deadline to Deliver at least one (1) REC confirming that there are no technical issues, with respect to such Designated System, known to Seller that would impede the generation, issuance and Delivery of RECs from such Designated System or that such technical issues have been resolved by Seller. In the event that Seller fails to provide such written notice within sixty (60) days of the applicable deadline to Deliver at least one (1) REC, then the number of ofDesignated System and the RECs associated with such Designated System shall be deemed removed from this REC Contract and. As soon as practicable after the occurrence of such failure by Seller, the IPA shall provide to Buyer and Seller a revised Schedule A, Schedule B, and Schedule C to the Product Order for such Designated System indicating the removal of such Designated System from the REC Contract. Upon the occurrence of such failure, Buyer shall be entitled to payment by Seller in the amount of the greater of: (i) the Collateral Requirement for such Designated System or (ii) one hundred percent (100%) of the total payments Seller has received from Buyer associated with RECs from such Designated System.
(b) For each Designated System that has been Energized, all RECs designated to be Delivered pursuant to the Standing Order associated with such Designated System shall be Delivered to Buyer commencing from the date such Standing Order is established through the end of the Delivery Term of such Designated System regardless of whether the total payment made by Buyer to Seller for RECs from such Designated System is commensurate with the actual number of RECs Delivered from such Designated System.
(c) For each Designated System that has been Energized, a REC delivery schedule is provided in Schedule B to the Product Order applicable to such Designated System that contains the expected number of RECs to be Delivered through the end of the Delivery Term where the number of RECs expected to be Delivered in each Delivery Year is based on the Designated System Contract Maximum REC Quantity and a degradation factor of half of one percent (0.5%) annually, and rounded down to the nearest whole REC in each Delivery Year. The REC quantities expected to be Delivered from such Designated System in a Delivery Year shall be the “Delivery Year Expected REC Quantity” for such Delivery Year. For avoidance of doubt, with respect to a Designated System, the Delivery Year Expected REC Quantities in the delivery schedule are determined at the time of Energization and not when the Delivery Term starts. As such, for purposes of calculating the Delivery Year Expected REC Quantity for each Delivery Year, the Delivery Year in which the date of Energization occurred shall be the first Delivery Year for which a Delivery Year Expected REC Quantity is calculated and the Delivery Year Expected REC Quantity for such first Delivery Year shall reflect an annualized number based on allocating the Designated System Contract Maximum REC Quantity across 15 years using a degradation factor of half of one percent (0.5%) annually. If the Delivery Term extends beyond a 15-Delivery Year schedule starting with that first Delivery Year, then each subsequent Delivery Year Expected REC Quantity subsequent to the 15th Delivery Year shall reflect a quantity that provides for a degradation factor of half of one percent (0.5%) from the prior Delivery Year Expected REC Quantity (a sample delivery schedule is provided in Exhibit F).
(d) Once annually on or prior to November 15 following a Delivery Year, the IPA or its designee shall review the performance of the REC deliveries made during such Delivery Year Year, using information provided in the REC Annual Report submitted pursuant to Section 10(c) of the Cover Sheet, and determine the amount of Aggregate Drawdown Payment due as follows:
(i) For each Designated System that has been Energized and three (3) full Delivery Years has occurred since the start of the Delivery Term of such Designated System, the IPA or its designee shall calculate, with respect to a Delivery Year, a Delivery Year REC Performance for such Delivery Year (an example Delivery Year REC Performance calculation is provided in Exhibit G);
(ii) With respect to a Designated System that has been Energized and three (3) full Delivery Years has occurred since the start of the Delivery Term of such Designated System, in the event that the Delivery Year REC Performance is greater than the applicable Delivery Year Expected REC Quantity, the difference in the number of RECs shall be the “Delivery Year Surplus Amount” and each REC included in the Delivery Year Surplus Amount shall be a “Surplus REC”;
(iii) With respect to a Designated System that has been Energized and three (3) full Delivery Years has occurred since the start of the Delivery Term of such Designated System, in the event that the Delivery Year REC Performance is less than the Delivery Year Expected REC Quantity, the difference in the number of RECs shall be the “Delivery Year Shortfall Amount”;
(iv) For each Designated System that has a Delivery Year Shortfall Amount, starting with the Designated System with the lowest Contract Price, Surplus RECs from the Surplus REC Account shall be reduced and allocated to meet such Delivery Year Shortfall Amount, REC for REC. If there are insufficient Surplus RECs to meet the Delivery Year Shortfall Amount, then the number of RECs calculated as the difference between the Delivery Year Shortfall Amount and the sum of such Surplus RECs being applied to meet the Delivery Year Shortfall Amount is the “Drawdown REC Quantity”, and the multiplicative product of the Drawdown REC Quantity and the Contract Price of such Designated System is the “Drawdown Payment”; and
(v) At the end of the foregoing process:
(1) Buyer shall draw on Seller’s Performance Assurance in the amount of the Aggregate Drawdown Payment.Buyer shall inform Seller of the Aggregate Drawdown Payment (including any Drawdown Payment pursuant to Section 6(d)(iv) of the Cover Sheet and any Drawdown Payment pursuant to Section 6(e) of the Cover Sheet) by written notice and Seller may, within five (5) Business Days of such written notice, request for payment of the Aggregate Drawdown Payment to be made by additional cash transfer by Seller to Buyer or request for the payment of the Aggregate Drawdown Payment to be made from the cash or the Letter of Credit held as Seller’s Performance Assurance if both cash and a Letter of Credit are held as Seller’s Performance Assurance. If Buyer does not receive such request from Seller within such five (5) Business Day period, or if Seller makes a request within the five (5) Business Day period to pay with cash and then fails to remit the full cash payment by the fourteenth (14th) Business Day after Buyer’s written notice to Seller, Buyer shall draw on Seller’s Performance Assurance to reach the full amount of the Aggregate Drawdown Payment. If Buyer does receive such request from Seller for a draw on a particular form of Performance Assurance within such five (5) Business Day period, then Buyer shall draw on Seller’s Performance Assurance in the form requested. In all cases of a draw on Performance Assurance, the draw shall be made on or after the fifteenth (15th) Business Day after Buyer’s written notice to Seller. Seller shall be required to replenish Seller’s Performance Assurance in accordance with Section 4.3 of the Master REC Agreement. If Seller’s Performance Assurance is less than the Aggregate Drawdown Payment, or if Seller has requested to make such payments by additional cash transfer, then Seller shall pay Buyer the difference or the amount of such payments, respectively, within fifteen
fifteen (15) Business Days of notice by Buyer. Failure by Seller to pay Buyer shall be an Event of Default subject to the Termination remedies under this REC Contract Contract. Notwithstanding the foregoing, if this is not the last Delivery Year under this REC Contract and the amount of the Aggregate Drawdown Payment is less than $5,000, then Buyer shall not draw on Seller’s Performance Assurance, but will track such amount and add such amount to the Aggregate Drawdown Payment for the subsequent Delivery Year or Delivery Years until the earlier of: the last Delivery Year or such time when the Aggregate Drawdown Payment is at least $5,000;
(2) For purposes of calculating the Delivery Year REC Performance in future Delivery Years, each Designated System that has a Delivery Year Shortfall Amount for which such Delivery Year Shortfall Amount is covered by Surplus REC(s) and/or for which a payment from Seller or from Seller’s Performance Assurance has been applied to the Drawdown REC Quantity, such Designated System is deemed to have Delivered REC quantities equal to the Delivery Year Expected REC Quantity in such Delivery Year.
(e) If a Designated System is a Community Renewable Energy Generation Project, such Designated System must maintain at least the Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed as provided in the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet throughout the remainder of the Delivery Term after the issuance of such Community Solar Quarterly Report. Failure to maintain the Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed as provided in the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet in a Delivery Year shall result in payment to Buyer from Seller of a monetary amount, determined by the IPA or its designee, and Buyer may draw on Seller’s Performance Assurance for this purpose. For the purposes of Community Solar Subscription Mix, the Designated System must maintain the percentage mix required under the ABP for the REC price adder obtained in the Contract Price that resulted from the Community Solar Subscription Mix indicated in the last Community Solar Quarterly Report. For each Delivery Year after the issuance of the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet, then, using the Annual Report submitted under Section 10(c) of the Cover Sheet and at the same time as the calculations made under Section 6(d) of the Cover Sheet: the subscription percentage and Community Solar Subscription Mix will each be calculated by the IPA as a daily average, then averaged over the Delivery Year, ,. This daily average will be based on actual subscription start and end dates comprised of the day a subscription start or end request was submitted to the utility, as entered in the REC Annual Report. The draw on Seller’s Performance Assurance will be calculated as the difference between (a) the contracted payment for that Delivery Year and (b) the amount that would have been paid given the realized Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed, if (a) exceeds (b). This amount will be calculated in arrears for only the immediately preceding Delivery Year covered by the REC Annual Report. If a Designated System meets a Community Solar Subscription Mix requirement for a lower REC price adder than what was obtained following the last Community Solar Quarterly Report, it will be deemed to have obtained that lower adder for the Delivery Year for the purposes of calculating the draw above. If the Designated System regains a Community Solar Subscription mix and subscription percentage at or above their contracted amount in subsequent years, a drawdown will not occur in those years; however, overperformance in a Delivery Year will not be banked or applied to past Delivery Years. Designated Systems with subscription levels above 90% of Actual Nameplate Capacity on a kW capacity basis for a Delivery Year will not be subject to a draw on Seller’s Performance Assurance for that Delivery Year on the basis of subscription percentage. This calculation will only occur after the final Contract Price and quantity of RECs due payment are determined per section 5(e)(iv)(D) of the Cover Sheet and will be based on that final Contract Price and quantity which is determined by the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet. Any draw for a Designated System in a Delivery Year calculated pursuant to this Section 6(e) shall be a Drawdown Payment, in addition to any Drawdown Payments calculated under Section 6(d)(iv) above. Buyer shall include information on any Drawdown Payment amounts due pursuant to this Section 6(e) for a Delivery Year with the written notice specified in 6(d)(v)(1) above for that Delivery Year.
(f) During the Delivery Term, Seller may determine that a Designated System is not performing at the level expected. In such case, Seller may submit a request to Buyer and the IPA (or its designee) to have the Delivery obligations of such Designated System reduced, and if the request is accepted by Buyer, such request shall be in exchange for the return by Seller to Buyer of an agreed upon payment adjustment if payment has been made by Buyer for RECs from such Designated System. Such request shall include pertinent information related to the payment adjustment as well as requested changes to future Delivery Year Expected REC Quantity and Contract Nameplate Capacity. Any such request shall be deemed approved upon Buyer’s receipt of such agreed upon payment adjustment, and information regarding the receipt of and the calculation of the agreed upon payment adjustment shall be communicated to the IPA and its designee. .. Any such changes in the delivery schedule and adjustments adjustmentsamendments made to future Delivery Year Expected REC Quantity and Contract Nameplate Capacity shall be documented in an amended Schedule B to the Product Order applicable to such Designated System issued by the IPA or its designee to Buyer and Seller.
(g) Surplus RECs are virtually tracked in the Surplus REC Account and shall remain, except as provided in Section 9.2 of the Master REC Agreement, in such account until a reduction in such Surplus RECs is recorded by the IPA or its designee to meet a Delivery Year Shortfall Amount.
(h) Upon the conclusion of the annual review process pursuant to Section 6(d) above for the last Delivery Year under this REC Contract, if (i) there are Surplus RECs remaining in the Surplus REC Account and (ii) an Aggregate Aggregatea Drawdown Payment calculated under Section 6(d)(iv) above has occurred during the Term of this REC Contract, then the IPA or its designee shall calculate a monetary refund adjustment due to Seller from Buyer. Buyer shall credit Seller for each Surplus REC that can be applied to a REC associated with a Drawdown Payment. as defined in the first sentence of this Section 6(h). For purpose of calculating the refund, Surplus RECs from the Surplus REC Account shall be reduced and applied to the RECs that are associated with a Drawdown Payment, starting with the REC with the lowest Contract Price, REC for REC. The monetary refund adjustment shall be paid from Buyer to Seller by December 31 following the conclusion of the last annual review process. For avoidance of doubt, no refund shall be made for any Drawdown Payment calculated pursuant to Section 6(e) of the Cover Sheet, and no payment shall be made for any Surplus RECs that remain in the Surplus REC Account after the refund adjustment is calculated.
Appears in 1 contract
Sources: Renewable Energy Credit Agreement
Deliveries and Quantity. (a) For each Designated System that has been Energized, the Delivery of at least one (1) REC from such Designated System is expected to occur to the Buyer’s PJM-EIS GATS account or M-RETS account, as applicable, within 90 calendar ninety (90) days of when such Designated System was Energized if the Actual Nameplate Capacity of such Designated System is greater than 5kW or within 180 calendar one hundred eighty (180) days of when the Designated System was Energized if the Actual Nameplate Capacity of such Designated System is equal to or less than 5kW. For each Designated System that fails to Deliver at least (1) one REC from such Designated System by the applicable deadline, Seller must provide to Buyer and the IPA or its designeeIPA, with respect to such Designated System, a written notice within sixty (60) days of the applicable deadline to Deliver at least one one
(1) REC confirming that there are no technical issues, with respect to such Designated System, known to Seller that would impede the generation, issuance and Delivery of RECs from such Designated System or that such technical issues have been resolved by Seller. In the event that Seller fails to provide such written notice within sixty (60) days of the applicable deadline to Deliver at least one (1) REC, then the number of Designated System and the RECs associated with such Designated System shall be deemed removed from this REC Contract Contract. As soon as practicable after the occurrence of such failure by Seller, the IPA shall provide to Buyer and Seller a revised Schedule A, Schedule B, and Schedule C to the Product Order for such Designated System indicating the removal of such Designated System from the REC Contract. Upon the occurrence of such failure, Buyer shall be entitled to payment by Seller in the amount of the greater of: (i) the Collateral Requirement for such Designated System or (ii) one hundred percent (100%) of the total payments Seller has received from Buyer associated with RECs from such Designated System.
(b) For each Designated System that has been Energized, all RECs designated to be Delivered pursuant to the Standing Order associated with such Designated System shall be Delivered to Buyer commencing from the date such Standing Order is established through the end of the Delivery Term of such Designated System regardless of whether the total payment made by Buyer to Seller for RECs from such Designated System is commensurate with the actual number of RECs Delivered from such Designated System.
(c) For each Designated System that has been Energized, a REC delivery schedule is provided in Schedule B to the Product Order applicable to such Designated System that contains the expected number of RECs to be Delivered through the end of the Delivery Term where the number of RECs expected to be Delivered in each Delivery Year is based on the Designated System Contract Maximum REC Quantity and a degradation factor of half of one percent (0.5%) annually, and rounded down to the nearest whole REC in each Delivery Year. The REC quantities expected to be Delivered from such Designated System in a Delivery Year shall be the “Delivery Year Expected REC Quantity” for such Delivery Year. For avoidance of doubt, with respect to a Designated System, the Delivery Year Expected REC Quantities in the delivery schedule are determined at the time of Energization and not when the Delivery Term starts. As such, for purposes of calculating the Delivery Year Expected REC Quantity for each Delivery Year, the Delivery Year in which the date of Energization occurred shall be the first Delivery Year for which a Delivery Year Expected REC Quantity is calculated and the Delivery Year Expected REC Quantity for such first Delivery Year shall reflect an annualized number based on allocating the Designated System Contract Maximum REC Quantity across 15 years using a degradation factor of half of one percent (0.5%) annually. If the Delivery Term extends beyond a 15-Delivery Year schedule starting with that first Delivery Year, then each subsequent Delivery Year Expected REC Quantity subsequent to the 15th Delivery Year shall reflect a quantity that provides for a degradation factor of half of one percent (0.5%) from the prior Delivery Year Expected REC Quantity (a sample delivery schedule is provided in Exhibit F).
(d) Once annually on or prior to November 15 following a Delivery Year, the IPA or its designee shall review the performance of the REC deliveries made during such Delivery Year Year, using information provided in the REC Annual Report submitted pursuant to Section 10(c) of the Cover Sheet, and determine the amount of Aggregate Drawdown Payment due as follows:
(i) For each Designated System that has been Energized and three (3) full Delivery Years has have occurred since the start of the Delivery Term of such Designated System, the IPA or its designee shall calculate, with respect to a Delivery Year, a Delivery Year REC Performance for such Delivery Year (an example Delivery Year REC Performance calculation is provided in Exhibit G);
(ii) With respect to a Designated System that has been Energized and three (3) full Delivery Years has have occurred since the start of the Delivery Term of such Designated System, in the event that the Delivery Year REC Performance is greater than the applicable Delivery Year Expected REC Quantity, the difference in the number of RECs shall be the “Delivery Year Surplus Amount” and each REC included in the Delivery Year Surplus Amount shall be a “Surplus REC”;
(iii) With respect to a Designated System that has been Energized and three (3) full Delivery Years has have occurred since the start of the Delivery Term of such Designated System, in the event that the Delivery Year REC Performance is less than the Delivery Year Expected REC Quantity, the difference in the number of RECs shall be the “Delivery Year Shortfall Amount”;
(iv) For each Designated System that has a Delivery Year Shortfall Amount, starting with the Designated System with the lowest Contract Price, Surplus RECs from the Surplus REC Account shall be reduced and allocated to meet such Delivery Year Shortfall Amount, REC for REC. If there are insufficient Surplus RECs to meet the Delivery Year Shortfall Amount, then the number of RECs calculated as the difference between the Delivery Year Shortfall Amount and the sum of such Surplus RECs being applied to meet the Delivery Year Shortfall Amount is the “Drawdown REC Quantity”, and the multiplicative product of the Drawdown REC Quantity and the Contract Price of such Designated System is the “Drawdown Payment”; and
(v) At the end of the foregoing process:
(1) Buyer shall inform Seller of the Aggregate Drawdown Payment (including any Drawdown Payment pursuant to Section 6(d)(iv) of the Cover Sheet and any Drawdown Payment pursuant to Section 6(e) of the Cover Sheet) by written notice and Seller may, within five (5) Business Days of such written notice, request for payment of the Aggregate Drawdown Payment to be made by additional cash transfer by Seller to Buyer or request for the payment of the Aggregate Drawdown Payment to be made from the cash or the Letter of Credit held as Seller’s Performance Assurance if both cash and a Letter of Credit are held as Seller’s Performance Assurance. If Buyer does not receive such request from Seller within such five (5) Business Day period, or if Seller makes a request within the five (5) Business Day period to pay with cash and then fails to remit the full cash payment by the fourteenth (14th) Business Day after Buyer’s written notice to Seller, Buyer shall draw on Seller’s Performance Assurance to reach the full amount of the Aggregate Drawdown Payment. If Buyer does receive such request from Seller for a draw on a particular form of Performance Assurance within such five (5) Business Day period, then Buyer shall draw on Seller’s Performance Assurance in the amount form requested. In all cases of a draw on Performance Assurance, the Aggregate Drawdown Paymentdraw shall be made on or after the fifteenth (15th) Business Day after Buyer’s written notice to Seller. Seller shall be required to replenish Seller’s Performance Assurance in accordance with Section 4.3 of the Master REC Agreement. If Seller’s Performance Assurance is less than the Aggregate Drawdown Payment, or if Seller has requested to make such payments by additional cash transfer, then Seller shall pay Buyer the difference or the amount of such payments, respectively, within fifteen
fifteen (15) Business Days of notice by Buyer. Failure by Seller to pay Buyer shall be an Event of Default subject to the Termination remedies under this REC Contract Contract. Notwithstanding the foregoing, if this is not the last Delivery Year under this REC Contract and the amount of the Aggregate Drawdown Payment is less than $5,000, then Buyer shall not draw on Seller’s Performance Assurance, but will track such amount and add such amount to the Aggregate Drawdown Payment for the subsequent Delivery Year or Delivery Years until the earlier of: the last Delivery Year or such time when the Aggregate Drawdown Payment is at least $5,000;
(2) For purposes of calculating the Delivery Year REC Performance in future Delivery Years, each Designated System that has a Delivery Year Shortfall Amount for which such Delivery Year Shortfall Amount is covered by Surplus REC(s) and/or for which a payment from Seller or from Seller’s Performance Assurance has been applied to the Drawdown REC Quantity, such Designated System is deemed to have Delivered REC quantities equal to the Delivery Year Expected REC Quantity in such Delivery Year.
(e) If a Designated System is a Community Renewable Energy Generation Project, such Designated System must maintain at least the Community Solar Subscription Mix Mix, the percent of Actual Nameplate Capacity that has been subscribed by the Anchor Tenant and the percent of Actual Nameplate Capacity that has been subscribed by End Use Customers as provided in the last Community Solar Quarterly First Year Report submitted pursuant to Section 10(b) of the Cover Sheet throughout the remainder of the Delivery Term after the issuance of such Community Solar Quarterly First Year Report. Failure to maintain the Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed by the Anchor Tenant and the percent of Actual Nameplate Capacity that has been subscribed by End Use Customers as provided in the last Community Solar Quarterly First Year Report submitted pursuant to Section 10(b) of the Cover Sheet in a Delivery Year shall result in payment to Buyer from Seller of a monetary amount, determined by the IPA or its designeeIPA, and Buyer may draw on Seller’s Performance Assurance for this purpose. The Designated System must maintain the minimum Community Solar Subscription Mix required under the SFA for the REC price adder obtained in the Non-Anchor Tenant Contract Price that resulted from the Community Solar Subscription Mix indicated in the Community Solar First Year Report; the Designated System must also maintain the subscription shares of the Anchor Tenant and End Use Customers as indicated in the Community Solar First Year Report. For each Delivery Year after the issuance of the last Community Solar Quarterly First Year Report submitted pursuant to Section 10(b) of the Cover Sheet, then, using the subscription percentage REC Annual Report submitted under Section 10(c) of the Cover Sheet and at the same time as the calculations made under Section 6(d) of the Cover Sheet: the Community Solar Subscription Mix as well as the subscription share percentages of the Anchor Tenant and End Use Customers will each be calculated by the IPA as a daily average, then averaged over the Delivery Year, . This daily average will be based on actual subscription start and end dates comprised of the day that a subscription start or end request was submitted to the utility, as entered in the REC Annual Report. The draw on Seller’s Performance Assurance will be calculated as the sum of the following: (i) the difference between (a) the contracted payment for Community Solar Anchor Payment allocable to that Delivery Year and (b) the amount that would have been paid for the Anchor Tenant’s subscription share for that Delivery Year given the percent of Actual Nameplate Capacity that has been subscribed by Anchor Tenant in that Delivery Year, if (a) exceeds (b); and (ii) the difference between (x) the Community Solar Non-Anchor Payment allocable to that Delivery Year and (y) the amount that would have been paid for the End Use Customers’ subscription share for that Delivery Year given the realized Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribedsubscribed by End Use Customers in that Delivery Year, if (ax) exceeds (y).3 (Provided, that the draw on Seller’s Performance Assurance will simply equal the total payment allocable to that Delivery Year if the percent of Non-Anchor Nameplate Capacity that has been subscribed by End Use Customers in that Delivery Year is less than fifty percent (50%); but if this deficiency is due to the loss of an Anchor Tenant in the Delivery Year, the Seller shall have a specified period determined by the IPA from the end of the Delivery Year to cure the deficiency before such a draw is made. If the percent of Non-Anchor Nameplate Capacity that has been subscribed by End Use Customers is at least fifty percent (50%) at the end of such cure period, the draw on Seller’s Performance Assurance will be calculated as the sum of the following: (i) the difference between (a) the Community Solar Anchor Payment allocable to that Delivery Year and (b) the amount that would have been paid for the Anchor Tenant’s subscription share for that Delivery Year given the percent of Actual Nameplate Capacity that has been subscribed by Anchor Tenant in that Delivery Year). ; and (ii) the difference between (x) the Community Solar Non-Anchor Payment allocable to that Delivery Year and (y) the amount that would have been paid for the End Use Customers’ subscription share for that Delivery Year given the realized Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed by End Use Customers in that Delivery Year, if (x) exceeds (y), but will not be the total payment allocable to that Delivery Year.) This amount will be calculated in arrears for only the immediately preceding Delivery Year covered by the REC Annual Report. If a Designated System meets a Community Solar Subscription Mix requirement for a lower REC price adder than what was obtained following the Community Solar First Year Report, it will be deemed to have obtained that lower adder for the Delivery Year for the purposes of calculating the draw above. If the Designated System regains a Community Solar Subscription mix and subscription percentage at or above their contracted amount in subsequent years, a drawdown will not occur in those years; however, overperformance in a Delivery Year will not be banked or applied to past Delivery Years. Designated Systems with total subscription levels (including only subscription shares of the Anchor Tenant and End Use Customers) above 90% of Actual Nameplate Capacity on a kW capacity basis for a Delivery Year will not be subject to a draw on Seller’s Performance Assurance for that Delivery Year on the basis of subscription percentage. This calculation will only occur after the final Contract Price and quantity of RECs due payment 3 For avoidance of doubt, the calculations made in this Section 6(e) shall not take into account any adjustments made pursuant to Section 5(f)(ii) or Section 5(f)(vi) of the Cover Sheet. For purposes of the calculating the (a) Community Solar Anchor Payment, (b) Community Solar Non-Anchor Payment, (c) the amounts that would have been paid for the Anchor Tenant’s subscription share, and (d) the amounts that would have been paid for the End Use Customer’s subscription share required pursuant to this section 6(e), the applicable Anchor Tenant Contract Price shall be applied to the share of the Actual Nameplate Capacity being subscribed by the Anchor Tenant only, and the applicable Non- Anchor Tenant Contract Price shall be applied to the share of the Actual Nameplate Capacity being subscribed by End Use Customers only. are determined per section 5(e)(iv)(DSections 5(f)(i)-(iii) of the Cover Sheet and will be based on that final Contract Price and quantity which is determined by the last Community Solar Quarterly First Year Report submitted pursuant to Section 10(b) of the Cover Sheet.
(f) During the Delivery Term, Seller may determine that a Designated System is not performing at the level expected. In such case, Seller may submit a request to Buyer and the IPA (or its designee) to have the Delivery obligations of such Designated System reduced, and if the request is accepted by Buyer, such request shall be in exchange for the return by Seller to Buyer of an agreed upon payment adjustment if payment has been made by Buyer for RECs from such Designated System. Such request shall include pertinent information related to the payment adjustment as well as requested changes to future Delivery Year Expected REC Quantity and Contract Nameplate Capacity. Any such request shall be deemed approved upon Buyer’s receipt of such agreed upon payment adjustment, and information regarding the receipt of and the calculation of the agreed upon payment adjustment shall be communicated to the IPA and its designee. Any such changes in the delivery schedule and adjustments made to future Delivery Year Expected REC Quantity and Contract Nameplate Capacity shall be documented in an amended Schedule B to the Product Order applicable to such Designated System issued by the IPA or its designee to Buyer and Seller.
(g) Surplus RECs are virtually tracked in the Surplus REC Account and shall remain, except as provided in Section 9.2 of the Master REC Agreement, in such account until a reduction in such Surplus RECs is recorded by the IPA or its designee to meet a Delivery Year Shortfall Amount.
(h) Upon the conclusion of the annual review process pursuant to Section 6(d) above for the last Delivery Year under this REC Contract, if (i) there are Surplus RECs remaining in the Surplus REC Account and (ii) an Aggregate Drawdown Payment has occurred during the Term of this REC Contract, then the IPA or its designee shall calculate a monetary refund adjustment due to Seller from Buyer. Buyer shall credit Seller for each Surplus REC that can be applied to a REC associated with a Drawdown Payment. For purpose of calculating the refund, Surplus RECs from the Surplus REC Account shall be reduced and applied to the RECs that are associated with a Drawdown Payment, starting with the REC with the lowest Contract Price, REC for REC. The monetary refund adjustment shall be paid from Buyer to Seller by December 31 following the conclusion of the last annual review process. For avoidance of doubt, no payment shall be made for any Surplus RECs that remain in the Surplus REC Account after the refund adjustment is calculated.Cove
Appears in 1 contract
Sources: Renewable Energy Credit Agreement
Deliveries and Quantity. (a) For each Designated System that has been Energized, the Delivery of at least one (1) REC from such Designated System is expected to occur to the Buyer’s PJM-EIS GATS account or M-RETS account, as applicable, within 90 calendar days of when such Designated System was Energized if the Actual Contract Nameplate Capacity of such Designated System is greater than 5kW or within 180 calendar days of when the Designated System was Energized if the Actual Contract Nameplate Capacity of such Designated System is equal to or less than 5kW. For each Designated System that fails to Deliver at least (1) one REC from such Designated System by the applicable deadlineSystem, Seller must provide to Buyer and the IPA or its designee, with respect to such Designated System, a written notice within sixty thirty (6030) days of the applicable deadline to Deliver at least one (1) REC confirming that there are no technical issues, with respect to such Designated System, known to Seller that would impede the generation, issuance and Delivery of RECs from such Designated System or that such technical issues have has been resolved by Seller. In the event that Seller fails to provide such written notice within sixty (60) days of the applicable deadline to Deliver at least one (1) REC, then the number of RECs associated with such Designated System shall be deemed removed from this REC Contract and Buyer shall be entitled to payment by Seller in the amount of the greater of: (i) the Collateral Requirement for such Designated System or (ii) one hundred percent (100%) of the total payments Seller has received from Buyer associated with RECs from such Designated System.;
(b) For each Designated System that has been Energized, all RECs designated to be Delivered pursuant to the Standing Order associated with such Designated System shall be Delivered to Buyer commencing from the date such Standing Order is established through the end of the Delivery Term of such Designated System regardless of whether the total payment made by Buyer to Seller for RECs from such Designated System is commensurate with the actual number of RECs Delivered from such Designated System.;
(c) For each Designated System that has been Energized, a REC delivery schedule is provided in Schedule B to the associated Product Order applicable to such Designated System that contains the expected number of RECs to be Delivered through the end of the Delivery Term where the number of RECs expected to be Delivered in each Delivery Year is based on the Designated System applicable Capacity Factor, Contract Maximum REC Quantity Nameplate Capacity and a degradation factor of half of one percent (0.5%) annually, and rounded down to the nearest whole REC in each Delivery YearREC. The REC quantities expected to be Delivered from such Designated System in a Delivery Year shall be the “Delivery Year Expected REC Quantity” for such Delivery Year. For avoidance of doubt, with respect to a Designated System, the Delivery Year Expected REC Quantities in the delivery schedule are determined at the time of Energization and not when the Delivery Term starts. As such, for purposes of calculating the Delivery Year Expected REC Quantity for each Delivery Year, the Delivery Year in which the date of Energization occurred shall be the first Delivery Year for which a Delivery Year Expected REC Quantity is calculated and the Delivery Year Expected REC Quantity for such first Delivery Year shall reflect an annualized number based on allocating the Designated System Contract Maximum REC Quantity across 15 years using a degradation factor of half of one percent (0.5%) annually. If the Delivery Term extends beyond a 15-Delivery Year schedule starting with that first Delivery Year, then each subsequent Delivery Year Expected REC Quantity subsequent to the 15th Delivery Year shall reflect a quantity that provides for a degradation factor of half of one percent (0.5%) from the prior Delivery Year Expected REC Quantity (a sample delivery schedule Delivery Schedule is provided in Exhibit F).) however, if the Designated System uses a technology with a different degradation factor, then such factor shall
(d) Once annually on or prior to November 15 following a Delivery Year, the IPA or its designee shall review the performance of the REC deliveries made during such Delivery Year and determine the amount of Aggregate Drawdown Payment payment due as follows:
(i) For each Designated System that has been Energized and three (3) full Delivery Years has occurred since the start of the Delivery Term of such Designated SystemEnergized, the IPA or its designee shall calculate, with respect to a Delivery Year, a Delivery Year REC Performance for such Delivery Year (an example Delivery Year REC Performance calculation is provided in Exhibit G);
(ii) With respect to a Designated System that has been Energized and three (3) full Delivery Years has occurred since the start of the Delivery Term of such Designated System, in the event that the Delivery Year REC Performance is greater than the applicable Delivery Year Expected REC Quantity, the difference in the number amount of RECs REC quantities shall be the “Delivery Year Surplus Amount” and each REC included issued in the Delivery Year Surplus Amount excess shall be a “Surplus REC”. For avoidance of doubt, RECs that are issued later in the Delivery Year are to be considered first as Surplus RECs ahead of RECs issued earlier in the Delivery Year if the Delivery Year Surplus Amount exceeds the number of RECs that are of the latest vintage as recorded by PJM EIS GATS or M-RETS for such Delivery Year. Surplus RECs are tracked in the Surplus REC Account and shall remain in such account until a reduction in such Surplus RECs are recorded by the IPA or its designee to meet a Delivery Year Shortfall Amount;
(iii) With respect to a Designated System that has been Energized and three (3) full Delivery Years has occurred since the start of the Delivery Term of such Designated System, in the event that the Delivery Year REC Performance is less than the Delivery Year Expected REC Quantity, the difference in the number amount of RECs REC quantities shall be the “Delivery Year Shortfall Amount;”;
(iv) For each Designated System that has a Delivery Year Shortfall Amount, starting with the Designated System with the lowest Contract Price, Surplus RECs from the Surplus REC Account shall be reduced and allocated to meet such Delivery Year Shortfall Amount, REC for REC. If there are insufficient Surplus RECs to meet the Delivery Year Shortfall Amount, then the number amount of RECs REC quantity calculated as the difference between the Delivery Year Shortfall Amount and the sum of such Surplus RECs being applied to meet the Delivery Year Shortfall Amount is the “Drawdown REC Quantity”, and the multiplicative product of the Drawdown REC Quantity and the Contract Price of such Designated System is the “Drawdown Payment”; and
(v) At the end of the foregoing process:
(1) Buyer shall draw on Seller’s Performance Assurance in the amount of the Aggregate Drawdown Payment. Seller shall be required to replenish Seller’s Performance Assurance in accordance with Section 4.3 of the Master REC Agreementas provided herein. If Seller’s Performance Assurance is less than the Aggregate Drawdown Payment, then Seller shall pay Buyer the difference within fifteen
ten (1510) ninety (90) Business Days of notice by Buyer. Failure by Seller to pay Buyer shall be an Event of Default subject to the Termination remedies under this REC Contract Notwithstanding Contract; for the foregoingavoidance of doubt, if this is not the last Delivery Year under this REC Contract and the amount such withdrawal of the Aggregate Drawdown Payment is less than $5,000, then Buyer shall not draw on Seller’s Performance Assurance, but will track such amount and add such amount to occur during the Aggregate Drawdown Payment for first 3 years of the subsequent Term since the Delivery Year or Delivery Years until the earlier of: the last Delivery Year or such time when the Aggregate Drawdown Payment REC Performance is at least $5,000;based on a 3 year rolling average basis and
(2) For purposes of calculating the Delivery Year REC Performance in the future Delivery Yearsyears, each Designated System that has a Delivery Year Shortfall Amount for which such Delivery Year Shortfall Amount is covered by Surplus REC(s) RECs and/or for which a payment from Seller or from Seller’s Performance Assurance has been applied to the Drawdown REC Quantity, such Designated System is deemed to have Delivered REC quantities equal to the Delivery Year Expected REC Quantity in such Delivery Year.
(e) If a Designated System is a Community Renewable Energy Generation Project, such Designated System must maintain at least the Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed as provided in the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet throughout the remainder of the Delivery Term after the issuance first year of such Community Solar Quarterly Reportoperations. Failure to maintain the Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed as provided in the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet in a Delivery Year shall result in payment to Buyer from Seller of a monetary amount, determined by the IPA or its designee, and Buyer may draw on Seller’s Performance Assurance for this purpose. For each Delivery Year after the issuance of the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet, the subscription percentage and Community Solar Subscription Mix will each be calculated as a daily average, then averaged over the Delivery Year, based on actual subscription start and end dates entered in the REC Annual Report. The draw on Seller’s Performance Assurance will be calculated as the difference between (a) the contracted payment for that Delivery Year and (b) the amount that would have been paid given the realized Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed, if (a) exceeds (b). This amount will be calculated in arrears for only the immediately preceding Delivery Year covered by the REC Annual Report. If the Designated System regains a Community Solar Subscription mix and subscription percentage at or above their contracted amount in subsequent years, a drawdown will not occur in those years; however, overperformance in a Delivery Year will not be banked or applied to past Delivery Years. Designated Systems with subscription levels above 90% of Actual Nameplate Capacity on a kW capacity basis for a Delivery Year will not be subject to a draw on Seller’s Performance Assurance for that Delivery Year on the basis of subscription percentage. This calculation will only occur after the final Contract Price and quantity of RECs due payment are determined per section 5(e)(iv)(D) of the Cover Sheet and will be based on that final Contract Price and quantity which is determined by the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet.
(f) During the Delivery Term, Seller may determine that a Designated System is not performing at the level expected. In such case, Seller may submit a request to Buyer and the IPA (or its designee) to have the Delivery obligations of such Designated System reduced, and if the request is accepted by Buyer, such request shall be reduced in exchange for the return by Seller to Buyer of an agreed upon payment adjustment if payment has been made by Buyer for RECs from such Designated System. Such request shall include pertinent information related to the payment adjustment as well as requested changes to future Delivery Year Expected REC Quantity and Contract Nameplate Capacity. Any such request shall be deemed approved upon Buyer’s receipt of such agreed upon payment adjustment, and information regarding the receipt of and the calculation of the agreed upon payment adjustment shall be communicated to the IPA and its designee. Any such changes in the delivery schedule and adjustments made to future Delivery Year Expected REC Quantity and Contract Nameplate Capacity shall be documented in an amended Schedule B to the Product Order applicable to such Designated System issued by the IPA or its designee to Buyer and Seller.
(g) Surplus RECs are virtually tracked in the Surplus REC Account and shall remain, except as provided in Section 9.2 of the Master REC Agreement, in such account until a reduction in such Surplus RECs is recorded by the IPA or its designee to meet a Delivery Year Shortfall Amount.
(h) Upon the conclusion of the annual review process pursuant to Section 6(d) above for the last Delivery Year under this REC Contract, if (i) there are Surplus RECs remaining in the Surplus REC Account and (ii) an Aggregate Drawdown Payment has occurred during the Term of this REC Contract, then the IPA or its designee shall calculate a monetary refund adjustment due to Seller from Buyer. Buyer shall credit Seller for each Surplus REC that can be applied to a REC associated with a Drawdown Payment. For purpose of calculating the refund, Surplus RECs from the Surplus REC Account shall be reduced and applied to the RECs that are associated with a Drawdown Payment, starting with the REC with the lowest Contract Price, REC for REC. The monetary refund adjustment shall be paid from Buyer to Seller by December 31 following the conclusion of the last annual review process. For avoidance of doubt, no payment shall be made for any Surplus RECs that remain in the Surplus REC Account after the refund adjustment is calculated.
Appears in 1 contract
Sources: Renewable Energy Credit Agreement
Deliveries and Quantity. (a) For each Designated System that has been Energized, the Delivery of at least one (1) REC from such Designated System is expected to occur to the Buyer’s PJM-EIS GATS account or M-RETS account, as applicable, within 90 calendar ninety (90) days of when such Designated System was Energized if the Actual Nameplate Capacity of such Designated System is greater than 5kW or within 180 calendar one hundred eighty (180) days of when the Designated System was Energized if the Actual Nameplate Capacity of such Designated System is equal to or less than 5kW. For each Designated System that fails to Deliver at least (1) one REC from such Designated System by the applicable deadline, Seller must provide to Buyer and the IPA or its designeeIPA, with respect to such Designated System, a written notice within sixty (60) days of the applicable deadline to Deliver at least one one
(1) REC confirming that there are no technical issues, with respect to such Designated System, known to Seller that would impede the generation, issuance and Delivery of RECs from such Designated System or that such technical issues have been resolved by Seller. In the event that Seller fails to provide such written notice within sixty (60) days of the applicable deadline to Deliver at least one (1) REC, then the number of Designated System and the RECs associated with such Designated System shall be deemed removed from this REC Contract Contract. As soon as practicable after the occurrence of such failure by Seller, the IPA shall provide to Buyer and Seller a revised Schedule A, Schedule B, and Schedule C to the Product Order for such Designated System indicating the removal of such Designated System from the REC Contract. Upon the occurrence of such failure, Buyer shall be entitled to payment by Seller in the amount of the greater of: (i) the Collateral Requirement for such Designated System or (ii) one hundred percent (100%) of the total payments Seller has received from Buyer associated with RECs from such Designated System.
(b) For each Designated System that has been Energized, all RECs designated to be Delivered pursuant to the Standing Order associated with such Designated System shall be Delivered to Buyer commencing from the date such Standing Order is established through the end of the Delivery Term of such Designated System regardless of whether the total payment made by Buyer to Seller for RECs from such Designated System is commensurate with the actual number of RECs Delivered from such Designated System.
(c) For each Designated System that has been Energized, a REC delivery schedule is provided in Schedule B to the Product Order applicable to such Designated System that contains the expected number of RECs to be Delivered through the end of the Delivery Term where the number of RECs expected to be Delivered in each Delivery Year is based on the Designated System Contract Maximum REC Quantity and a degradation factor of half of one percent (0.5%) annually, and rounded down to the nearest whole REC in each Delivery Year. The REC quantities expected to be Delivered from such Designated System in a Delivery Year shall be the “Delivery Year Expected REC Quantity” for such Delivery Year. For avoidance of doubt, with respect to a Designated System, the Delivery Year Expected REC Quantities in the delivery schedule are determined at the time of Energization and not when the Delivery Term starts. As such, for purposes of calculating the Delivery Year Expected REC Quantity for each Delivery Year, the Delivery Year in which the date of Energization occurred shall be the first Delivery Year for which a Delivery Year Expected REC Quantity is calculated and the Delivery Year Expected REC Quantity for such first Delivery Year shall reflect an annualized number based on allocating the Designated System Contract Maximum REC Quantity across 15 years using a degradation factor of half of one percent (0.5%) annually. If the Delivery Term extends beyond a 15-Delivery Year schedule starting with that first Delivery Year, then each subsequent Delivery Year Expected REC Quantity subsequent to the 15th Delivery Year shall reflect a quantity that provides for a degradation factor of half of one percent (0.5%) from the prior Delivery Year Expected REC Quantity (a sample delivery schedule is provided in Exhibit F).
(d) Once annually on or prior to November 15 following a Delivery Year, the IPA or its designee shall review the performance of the REC deliveries made during such Delivery Year Year, using information provided in the REC Annual Report submitted pursuant to Section 10(c) of the Cover Sheet, and determine the amount of Aggregate Drawdown Payment due as follows:
(i) For each Designated System that has been Energized and three (3) full Delivery Years has have occurred since the start of the Delivery Term of such Designated System, the IPA or its designee shall calculate, with respect to a Delivery Year, a Delivery Year REC Performance for such Delivery Year (an example Delivery Year REC Performance calculation is provided in Exhibit G);
(ii) With respect to a Designated System that has been Energized and three (3) full Delivery Years has have occurred since the start of the Delivery Term of such Designated System, in the event that the Delivery Year REC Performance is greater than the applicable Delivery Year Expected REC Quantity, the difference in the number of RECs shall be the “Delivery Year Surplus Amount” and each REC included in the Delivery Year Surplus Amount shall be a “Surplus REC”;
(iii) With respect to a Designated System that has been Energized and three (3) full Delivery Years has have occurred since the start of the Delivery Term of such Designated System, in the event that the Delivery Year REC Performance is less than the Delivery Year Expected REC Quantity, the difference in the number of RECs shall be the “Delivery Year Shortfall Amount”;
(iv) For each Designated System that has a Delivery Year Shortfall Amount, starting with the Designated System with the lowest Contract Price, Surplus RECs from the Surplus REC Account shall be reduced and allocated to meet such Delivery Year Shortfall Amount, REC for REC. If there are insufficient Surplus RECs to meet the Delivery Year Shortfall Amount, then the number of RECs calculated as the difference between the Delivery Year Shortfall Amount and the sum of such Surplus RECs being applied to meet the Delivery Year Shortfall Amount is the “Drawdown REC Quantity”, and the multiplicative product of the Drawdown REC Quantity and the Contract Price of such Designated System is the “Drawdown Payment”; and
(v) At the end of the foregoing process:
(1) Buyer shall inform Seller of the Aggregate Drawdown Payment (including any Drawdown Payment pursuant to Section 6(d)(iv) of the Cover Sheet and any Drawdown Payment pursuant to Section 6(e) of the Cover Sheet) by written notice and Seller may, within five (5) Business Days of such written notice, request for payment of the Aggregate Drawdown Payment to be made by additional cash transfer by Seller to Buyer or request for the payment of the Aggregate Drawdown Payment to be made from the cash or the Letter of Credit held as Seller’s Performance Assurance if both cash and a Letter of Credit are held as Seller’s Performance Assurance. If Buyer does not receive such request from Seller within such five (5) Business Day period, or if Seller makes a request within the five (5) Business Day period to pay with cash and then fails to remit the full cash payment by the fourteenth (14th) Business Day after Buyer’s written notice to Seller, Buyer shall draw on Seller’s Performance Assurance to reach the full amount of the Aggregate Drawdown Payment. If Buyer does receive such request from Seller for a draw on a particular form of Performance Assurance within such five (5) Business Day period, then Buyer shall draw on Seller’s Performance Assurance in the amount form requested. In all cases of a draw on Performance Assurance, the Aggregate Drawdown Paymentdraw shall be made on or after the fifteenth (15th) Business Day after Buyer’s written notice to Seller. Seller shall be required to replenish Seller’s Performance Assurance in accordance with Section 4.3 of the Master REC Agreement. If Seller’s Performance Assurance is less than the Aggregate Drawdown Payment, or if Seller has requested to make such payments by additional cash transfer, then Seller shall pay Buyer the difference or the amount of such payments, respectively, within fifteen
fifteen (15) Business Days of notice by Buyer. Failure by Seller to pay Buyer shall be an Event of Default subject to the Termination remedies under this REC Contract Contract. Notwithstanding the foregoing, if this is not the last Delivery Year under this REC Contract and the amount of the Aggregate Drawdown Payment is less than $5,000, then Buyer shall not draw on Seller’s Performance Assurance, but will track such amount and add such amount to the Aggregate Drawdown Payment for the subsequent Delivery Year or Delivery Years until the earlier of: the last Delivery Year or such time when the Aggregate Drawdown Payment is at least $5,000;
(2) For purposes of calculating the Delivery Year REC Performance in future Delivery Years, each Designated System that has a Delivery Year Shortfall Amount for which such Delivery Year Shortfall Amount is covered by Surplus REC(s) and/or for which a payment from Seller or from Seller’s Performance Assurance has been applied to the Drawdown REC Quantity, such Designated System is deemed to have Delivered REC quantities equal to the Delivery Year Expected REC Quantity in such Delivery Year.
(e) If a Designated System is a Community Renewable Energy Generation Project, such Designated System must maintain at least the Community Solar Subscription Mix Mix, the percent of Actual Nameplate Capacity that has been subscribed by the Anchor Tenant and the percent of Actual Nameplate Capacity that has been subscribed by End Use Customers as provided in the last Community Solar Quarterly First Year Report submitted pursuant to Section 10(b) of the Cover Sheet throughout the remainder of the Delivery Term after the issuance of such Community Solar Quarterly First Year Report. Failure to maintain the Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed by the Anchor Tenant and the percent of Actual Nameplate Capacity that has been subscribed by End Use Customers as provided in the last Community Solar Quarterly First Year Report submitted pursuant to Section 10(b) of the Cover Sheet in a Delivery Year shall result in payment to Buyer from Seller of a monetary amount, determined by the IPA or its designeeIPA, and Buyer may draw on Seller’s Performance Assurance for this purpose. The Designated System must maintain the minimum Community Solar Subscription Mix required under the SFA for the REC price adder obtained in the Non-Anchor Tenant Contract Price that resulted from the Community Solar Subscription Mix indicated in the Community Solar First Year Report; the Designated System must also maintain the subscription shares of the Anchor Tenant and End Use Customers as indicated in the Community Solar First Year Report. For each Delivery Year after the issuance of the last Community Solar Quarterly First Year Report submitted pursuant to Section 10(b) of the Cover Sheet, then, using the subscription percentage REC Annual Report submitted under Section 10(c) of the Cover Sheet and at the same time as the calculations made under Section 6(d) of the Cover Sheet: the Community Solar Subscription Mix as well as the subscription share percentages of the Anchor Tenant and End Use Customers will each be calculated by the IPA as a daily average, then averaged over the Delivery Year, . This daily average will be based on actual subscription start and end dates comprised of the day that a subscription start or end request was submitted to the utility, as entered in the REC Annual Report. The draw on Seller’s Performance Assurance will be calculated as the sum of the following: (i) the difference between (a) the contracted payment for Community Solar Anchor Payment allocable to that Delivery Year and (b) the amount that would have been paid for the Anchor Tenant’s subscription share for that Delivery Year given the percent of Actual Nameplate Capacity that has been subscribed by Anchor Tenant in that Delivery Year, if (a) exceeds (b); and (ii) the difference between (x) the Community Solar Non-Anchor Payment allocable to that Delivery Year and (y) the amount that would have been paid for the End Use Customers’ subscription share for that Delivery Year given the realized Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribedsubscribed by End Use Customers in that Delivery Year, if (ax) exceeds (y).3 (Provided, that the draw on Seller’s Performance Assurance will simply equal the total payment allocable to that Delivery Year if the percent of Non-Anchor Nameplate Capacity that has been subscribed by End Use Customers in that Delivery Year is less than fifty percent (50%); but if this deficiency is due to the loss of an Anchor Tenant in the Delivery Year, the Seller shall have a specified period determined by the IPA from the end of the Delivery Year to cure the deficiency before such a draw is made. If the percent of Non-Anchor Nameplate Capacity that has been subscribed by End Use Customers is at least fifty percent (50%) at the end of such cure period, the draw on Seller’s Performance Assurance will be calculated as the sum of the following: (i) the difference between (a) the Community Solar Anchor Payment allocable to that Delivery Year and (b) the amount that would have been paid for the Anchor Tenant’s subscription share for that Delivery Year given the percent of Actual Nameplate Capacity that has been subscribed by Anchor Tenant in that Delivery Year). ; and (ii) the difference between (x) the Community Solar Non-Anchor Payment allocable to that Delivery Year and (y) the amount that would have been paid for the End Use Customers’ subscription share for that Delivery Year given the realized Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed by End Use Customers in that Delivery Year, if (x) exceeds (y), but will not be the total payment allocable to that Delivery Year.) This amount will be calculated in arrears for only the immediately preceding Delivery Year covered by the REC Annual Report. If a Designated System meets a Community Solar Subscription Mix requirement for a lower REC price adder than what was obtained following the Community Solar First Year Report, it will be deemed to have obtained that lower adder for the Delivery Year for the purposes of calculating the draw above. If the Designated System regains a Community Solar Subscription mix and subscription percentage at or above their contracted amount in subsequent years, a drawdown will not occur in those years; however, overperformance in a Delivery Year will not be banked or applied to past Delivery Years. Designated Systems with total subscription levels (including only subscription shares of the Anchor Tenant and End Use Customers) above 90% of Actual Nameplate Capacity on a kW capacity basis for a Delivery Year will not be subject to a draw on Seller’s Performance Assurance for that Delivery Year on the basis of subscription percentage. This calculation will only occur after the final Contract Price and quantity of RECs due payment are determined per section 5(e)(iv)(DSections 5(f)(i)-(iii) of the Cover Sheet and will be based on that final Contract Price and quantity which is determined by the last Community Solar Quarterly First Year Report submitted pursuant to Section 10(b) of the Cover Sheet.
(f) During . Notwithstanding any of the Delivery Termforegoing, Seller may determine that a Designated System is not performing at the level expected. In such case, Seller may submit a request to Buyer and the IPA (or its designee) to have the Delivery obligations of such Designated System reduced, and if the request is accepted by Buyer, such request shall be in exchange for the return by Seller to Buyer total combined percent of an agreed upon payment adjustment if payment Actual Nameplate Capacity that has been made subscribed by Buyer the Anchor Tenant and by End Use Customers has decreased for RECs from a Delivery Year and such Designated System. Such request shall include pertinent information related decrease is no more than three percentage points (3% points) relative to the payment adjustment as well as requested changes to future Delivery Year Expected REC Quantity and Contract Nameplate Capacity. Any such request shall be deemed approved upon Buyer’s receipt total combined percent of such agreed upon payment adjustment, and information regarding the receipt of and the calculation of the agreed upon payment adjustment shall be communicated to the IPA and its designee. Any such changes in the delivery schedule and adjustments made to future Delivery Year Expected REC Quantity and Contract Actual Nameplate Capacity shall be documented in an amended Schedule B to the Product Order applicable to such Designated System issued that has been subscribed by the IPA or its designee to Buyer Anchor Tenant and Seller.
(g) Surplus RECs are virtually tracked in the Surplus REC Account and shall remain, except by End Use Customers as provided in Section 9.2 of the Master REC Agreement, in such account until a reduction in such Surplus RECs is recorded by the IPA or its designee to meet a Delivery Community Solar First Year Shortfall Amount.
(h) Upon the conclusion of the annual review process Report submitted pursuant to Section 6(d10(b) above of the Cover Sheet, then no draw shall occur pursuant to this Section 6(e) for such Delivery Year as long as the total combined percent of Actual Nameplate Capacity that has been subscribed by the Anchor Tenant and by End Use Customers for the last immediately following Delivery Year under this REC Contract, if (i) there are Surplus RECs remaining in the Surplus REC Account and (ii) an Aggregate Drawdown Payment has occurred during the Term of this REC Contract, then the IPA or its designee shall calculate a monetary refund adjustment due to Seller from Buyer. Buyer shall credit Seller for each Surplus REC that can be applied to a REC associated with a Drawdown Payment. For purpose of calculating the refund, Surplus RECs from the Surplus REC Account shall be reduced and applied is at least equal to the RECs that are associated with a Drawdown Payment, starting with the REC with the lowest Contract Price, REC for REC. The monetary refund adjustment shall be paid from Buyer to Seller by December 31 following the conclusion of the last annual review process. total 3 For avoidance of doubt, no payment shall be made for any Surplus RECs that remain in the Surplus REC Account after the refund adjustment is calculated.av
Appears in 1 contract
Sources: Renewable Energy Credit Agreement
Deliveries and Quantity. (a) Seller will Deliver the quantity of each Product specified in Table 1 and Buyer will pay the specified Purchase Price for such Product, all in accordance with this REC Contract. RECs generated from the Small Size Class cannot be substituted for RECs from the Large Size Class (and vice versa). For each Designated System that has been EnergizedDelivery Year, except as set forth in Section 4(d), the RECs must be generated between the applicable dates specified in Table 1 (all such required generation dates referred to as the “Vintage”) and must be Delivered on or before the Delivery of Date for the Spring Delivery Season for such Delivery Year.
(b) Notwithstanding the foregoing, for the first Delivery Year only, Seller shall provide written notification to Buyer with each invoice (with a copy provided to the IPA) regarding whether Seller has Delivered at least one (1) REC from such fromcompleted the registration process in PJM-GATS or M- RETS for each of the Designated Systems.Designated System is expected to occur to such that the Buyer’s initial meter read date as recorded in PJM-EIS GATS account or M-RETS accountoccurs on or before May 31, as applicable, within 90 calendar days of when such Designated System was Energized if 2017. In the Actual Nameplate Capacity of such Designated System is greater than 5kW or within 180 calendar days of when the Designated System was Energized if the Actual Nameplate Capacity of such Designated System is equal to or less than 5kW. For each Designated System event that (i) Seller fails to Deliver at least (1) one REC from such Designated System by the applicable deadline, Seller must provide to Buyer and the IPA or its designee, with respect to such Designated System, a written notice within sixty (60) days of the applicable deadline to Deliver at least one (1) REC confirming that there are no technical issuesfromcomplete the registration process in PJM-GATS or M-RETS for a Designated System by July 15, with respect to such Designated System, known to Seller that would impede the generation, issuance and Delivery of RECs 2016 arising from energy generated by such Designated System duringthe time the last invoice for the first Delivery Year is submitted or that such technical issues have been resolved by Seller. In (ii) the event that Seller fails to provide such written notice within sixty (60) days of the applicable deadline to Deliver at least one (1) RECinitial meter read date for a Designated System as recorded in PJM-GATS or M-RETS occurs after May 31, then the number of RECs associated with 2017, such Designated System shall will be deemed removed from this REC Contract and Buyer the Delivery Year Quantity of RECs specified in Table 1 shall be entitled to payment reduced by Seller in the amount of the greater of: (i) the Collateral Requirement for such Designated System or (ii) one hundred percent (100%) of the total payments Seller has received from Buyer RECs associated with RECs from such Designated System.
(b) For each Designated System that has been Energized, all RECs designated to be Delivered pursuant to the Standing Order associated with such Designated System shall be Delivered to Buyer commencing from the date such Standing Order is established through the end of the Delivery Term of such Designated System regardless of whether the total payment made by Buyer to Seller for RECs from such Designated System is commensurate with the actual number of RECs Delivered from such Designated System.
(c) For The following shall constitute an Event of Default: (i) Seller’s failure to Deliver eighty percent (80%) of the separate Delivery Year Quantity for each Designated System that has been Energized, a REC delivery schedule of the Size Classes by the Delivery Date for the Spring Delivery Season or (ii) if the separate Delivery Year Quantity for one of the Size Classes is provided in Schedule B to less than ten percent (10%) of the Product Order applicable to such Designated System that contains the expected number of RECs to be Delivered through the end sum of the Delivery Term where Year Quantities for both Size Classes for such Delivery Year or if the number sum of RECs expected to be Delivered in each the Delivery Year Quantities for both Size Classes for such Delivery Year is based on the Designated System Contract Maximum REC Quantity and a degradation factor of half of one less than 100 RECs, Seller’s failure to Deliver eighty percent (0.580%) annually, and rounded down to of the nearest whole REC in each Delivery Year. The REC quantities expected to be Delivered from such Designated System in a sum of the Delivery Year shall be the “Delivery Year Expected REC Quantity” Quantities for both Size Classes for such Delivery Year. For avoidance of doubt, with respect to a Designated System, Year by the Delivery Year Expected REC Quantities Date for the Spring Delivery Season; in the delivery schedule are determined at the time of Energization and not when the Delivery Term starts. As sucheach case, for purposes of calculating the as any such Delivery Year Expected REC Quantity for each Delivery Year, the Delivery Year in which the date of Energization occurred shall may be the first Delivery Year for which a Delivery Year Expected REC Quantity is calculated and the Delivery Year Expected REC Quantity for such first Delivery Year shall reflect an annualized number based on allocating the Designated System Contract Maximum REC Quantity across 15 years using a degradation factor of half of one percent (0.5%) annually. If the Delivery Term extends beyond a 15-Delivery Year schedule starting with that first Delivery Year, then each subsequent Delivery Year Expected REC Quantity subsequent reduced pursuant to the 15th Delivery Year shall reflect a quantity that provides for a degradation factor of half of one percent (0.5%) from the prior Delivery Year Expected REC Quantity (a sample delivery schedule is provided in Exhibit FSection 4(b).
(d) Once annually on or prior to November 15 following a For each Delivery Year, Buyer shall pay Seller for Product up to the IPA or its designee shall review the performance of the REC deliveries made during such Delivery Year and determine the amount of Aggregate Drawdown Payment due as follows:
(i) For each Designated System Quantity for such Product. Any RECs Delivered in a Delivery Year that has been Energized and three (3) full Delivery Years has occurred since the start are in excess of the Delivery Term of such Designated System, the IPA or its designee shall calculate, with respect Year Quantity may be used to a Delivery Year, a Delivery Year REC Performance for such Delivery Year (an example Delivery Year REC Performance calculation is provided in Exhibit G);
(ii) With respect to a Designated System that has been Energized and three (3) full Delivery Years has occurred since the start of the Delivery Term of such Designated System, in the event that satisfy the Delivery Year REC Performance is greater than the applicable Delivery Year Expected REC Quantity, the difference in the number of RECs shall be the “Delivery Year Surplus Amount” and each REC included in the Delivery Year Surplus Amount shall be a “Surplus REC”;
(iii) With respect to a Designated System that has been Energized and three (3) full Delivery Years has occurred since the start of the Delivery Term of such Designated System, in the event that the Delivery Year REC Performance is less than the Delivery Year Expected REC Quantity, the difference in the number of RECs shall be the “Delivery Year Shortfall Amount”;
(iv) For each Designated System that has a Delivery Year Shortfall Amount, starting with the Designated System with the lowest Contract Price, Surplus RECs from the Surplus REC Account shall be reduced and allocated to meet such Delivery Year Shortfall Amount, REC for REC. If there are insufficient Surplus RECs to meet the Delivery Year Shortfall Amount, then the number of RECs calculated as the difference between the Delivery Year Shortfall Amount and the sum of such Surplus RECs being applied to meet the Delivery Year Shortfall Amount is the “Drawdown REC Quantity”, and the multiplicative product of the Drawdown REC Quantity and the Contract Price of such Designated System is the “Drawdown Payment”; and
(v) At the end of the foregoing process:
(1) Buyer shall draw on Seller’s Performance Assurance in the amount of the Aggregate Drawdown Payment. Seller shall be required to replenish Seller’s Performance Assurance in accordance with Section 4.3 of the Master REC Agreement. If Seller’s Performance Assurance is less than the Aggregate Drawdown Payment, then Seller shall pay Buyer the difference within fifteen
(15) Business Days of notice by Buyer. Failure by Seller to pay Buyer shall be an Event of Default subject to the Termination remedies under this REC Contract Notwithstanding the foregoing, if this is not the last Delivery Year under this REC Contract and the amount of the Aggregate Drawdown Payment is less than $5,000, then Buyer shall not draw on Seller’s Performance Assurance, but will track such amount and add such amount to the Aggregate Drawdown Payment for the subsequent Delivery Year or Delivery Years until the earlier of: the last Year. Table 1 Purchase Price ($ per REC) [$ ] Small Size Class—Systems Less Than 25 KW Nameplate Capacity (DC Rating) Purchase Price ($ per REC) [$ ] Delivery Year or such time when the Aggregate Drawdown Payment is at least $5,000;
(2) For purposes of calculating the Delivery Year REC Performance in future Delivery YearsQuantity (# of RECs) Tracking System Vintage June 2015 through May 2016 [ ] [ ] June 1, each Designated System that has a 2015 and May 31, 2016 June 2016 through May 2017 [ ] [ ] June 1, 2016 and May 31, 2017 June 2017 through May 2018 [ ] [ ] June 1, 2017 and May 31, 2018 June 2018 through May 2019 [ ] [ ] June 1, 2018 and May 31, 2019 June 2019 through May 2020 [ ] [ ] June 1, 2019 and May 31, 2020 Large Size Class—Systems Greater Than or Equal to 25 KW Nameplate Capacity (DC Rating) Purchase Price ($ per REC) [$ ] Delivery Year Shortfall Amount for which such Delivery Year Shortfall Amount is covered by Surplus REC(sQuantity (# of RECs) and/or for which a payment from Seller or from Seller’s Performance Assurance has been applied to the Drawdown REC QuantityTracking System Vintage June 2015 through May 2016 [ ] [ ] June 1, such Designated System is deemed to have Delivered REC quantities equal to the Delivery Year Expected REC Quantity in such Delivery Year.
(e) If a Designated System is a Community Renewable Energy Generation Project2015 and May 31, such Designated System must maintain at least the Community Solar Subscription Mix 2016 June 2016 through May 2017 [ ] [ ] June 1, 2016 and the percent of Actual Nameplate Capacity that has been subscribed as provided in the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet throughout the remainder of the Delivery Term after the issuance of such Community Solar Quarterly Report. Failure to maintain the Community Solar Subscription Mix May 31, 2017 June 2017 through May 2018 [ ] [ ] June 1, 2017 and the percent of Actual Nameplate Capacity that has been subscribed as provided in the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet in a Delivery Year shall result in payment to Buyer from Seller of a monetary amountMay 31, determined by the IPA or its designee2018 June 2018 through May 2019 [ ] [ ] June 1, 2018 and Buyer may draw on Seller’s Performance Assurance for this purpose. For each Delivery Year after the issuance of the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover SheetMay 31, the subscription percentage 2019 June 2019 through May 2020 [ ] [ ] June 1, 2019 and Community Solar Subscription Mix will each be calculated as a daily averageMay 31, then averaged over the Delivery Year, based on actual subscription start and end dates entered in the REC Annual Report. The draw on Seller’s Performance Assurance will be calculated as the difference between (a) the contracted payment for that Delivery Year and (b) the amount that would have been paid given the realized Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed, if (a) exceeds (b). This amount will be calculated in arrears for only the immediately preceding Delivery Year covered by the REC Annual Report. If the Designated System regains a Community Solar Subscription mix and subscription percentage at or above their contracted amount in subsequent years, a drawdown will not occur in those years; however, overperformance in a Delivery Year will not be banked or applied to past Delivery Years. Designated Systems with subscription levels above 90% of Actual Nameplate Capacity on a kW capacity basis for a Delivery Year will not be subject to a draw on Seller’s Performance Assurance for that Delivery Year on the basis of subscription percentage. This calculation will only occur after the final Contract Price and quantity of RECs due payment are determined per section 5(e)(iv)(D) of the Cover Sheet and will be based on that final Contract Price and quantity which is determined by the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet.
(f) During the Delivery Term, Seller may determine that a Designated System is not performing at the level expected. In such case, Seller may submit a request to Buyer and the IPA (or its designee) to have the Delivery obligations of such Designated System reduced, and if the request is accepted by Buyer, such request shall be in exchange for the return by Seller to Buyer of an agreed upon payment adjustment if payment has been made by Buyer for RECs from such Designated System. Such request shall include pertinent information related to the payment adjustment as well as requested changes to future Delivery Year Expected REC Quantity and Contract Nameplate Capacity. Any such request shall be deemed approved upon Buyer’s receipt of such agreed upon payment adjustment, and information regarding the receipt of and the calculation of the agreed upon payment adjustment shall be communicated to the IPA and its designee. Any such changes in the delivery schedule and adjustments made to future Delivery Year Expected REC Quantity and Contract Nameplate Capacity shall be documented in an amended Schedule B to the Product Order applicable to such Designated System issued by the IPA or its designee to Buyer and Seller.
(g) Surplus RECs are virtually tracked in the Surplus REC Account and shall remain, except as provided in Section 9.2 of the Master REC Agreement, in such account until a reduction in such Surplus RECs is recorded by the IPA or its designee to meet a Delivery Year Shortfall Amount.
(h) Upon the conclusion of the annual review process pursuant to Section 6(d) above for the last Delivery Year under this REC Contract, if (i) there are Surplus RECs remaining in the Surplus REC Account and (ii) an Aggregate Drawdown Payment has occurred during the Term of this REC Contract, then the IPA or its designee shall calculate a monetary refund adjustment due to Seller from Buyer. Buyer shall credit Seller for each Surplus REC that can be applied to a REC associated with a Drawdown Payment. For purpose of calculating the refund, Surplus RECs from the Surplus REC Account shall be reduced and applied to the RECs that are associated with a Drawdown Payment, starting with the REC with the lowest Contract Price, REC for REC. The monetary refund adjustment shall be paid from Buyer to Seller by December 31 following the conclusion of the last annual review process. For avoidance of doubt, no payment shall be made for any Surplus RECs that remain in the Surplus REC Account after the refund adjustment is calculated.2020
Appears in 1 contract
Sources: Renewable Energy Credit Agreement
Deliveries and Quantity. (a) For each Designated System that has been Energized, the Delivery of at least one (1) REC from such Designated System is expected to occur to the Buyer’s PJM-EIS GATS account or M-RETS account, as applicable, within 90 calendar ninety (90) days of when such Designated System was Energized if the Actual Nameplate Capacity of such Designated System is greater than 5kW or within 180 calendar one hundred eighty (180) days of when the Designated System was Energized if the Actual Nameplate Capacity of such Designated System is equal to or less than 5kW. For each Designated System that fails to Deliver at least (1) one REC from such Designated System by the applicable deadline, Seller must provide to Buyer and the IPA or its designeeIPA, with respect to such Designated System, a written notice within sixty (60) days of the applicable deadline to Deliver at least one (1) REC confirming that there are no technical issues, with respect to such Designated System, known to Seller that would impede the generation, issuance and Delivery of RECs from such Designated System or that such technical issues have been resolved by Seller. In the event that Seller fails to provide such written notice within sixty (60) days of the applicable deadline to Deliver at least one (1) REC, then the number of Designated System and the RECs associated with such Designated System shall be deemed removed from this REC Contract Contract. As soon as practicable after the occurrence of such failure by Seller, the IPA shall provide to Buyer and Seller a revised Schedule A, Schedule B, and Schedule C to the Product Order for such Designated System indicating the removal of such Designated System from the REC Contract. Upon the occurrence of such failure, Buyer shall be entitled to payment by Seller in the amount of the greater of: (i) the Collateral Requirement for such Designated System or (ii) one hundred percent (100%) of the total payments Seller has received from Buyer associated with RECs from such Designated System.
(b) . For each Designated System that has been Energized, all RECs designated to be Delivered pursuant to the Standing Order associated with such Designated System shall be Delivered to Buyer commencing from the date such Standing Order is established through the end of the Delivery Term of such Designated System regardless of whether the total payment made by Buyer to Seller for RECs from such Designated System is commensurate with the actual number of RECs Delivered from such Designated System.
(c) . For each Designated System that has been Energized, a REC delivery schedule is provided in Schedule B to the Product Order applicable to such Designated System that contains the expected number of RECs to be Delivered through the end of the Delivery Term where the number of RECs expected to be Delivered in each Delivery Year is based on the Designated System Contract Maximum REC Quantity and a degradation factor of half of one percent (0.5%) annually, and rounded down to the nearest whole REC in each Delivery Year. The REC quantities expected to be Delivered from such Designated System in a Delivery Year shall be the “Delivery Year Expected REC Quantity” for such Delivery Year. For avoidance of doubt, with respect to a Designated System, the Delivery Year Expected REC Quantities in the delivery schedule are determined at the time of Energization and not when the Delivery Term starts. As such, for purposes of calculating the Delivery Year Expected REC Quantity for each Delivery Year, the Delivery Year in which the date of Energization occurred shall be the first Delivery Year for which a Delivery Year Expected REC Quantity is calculated and the Delivery Year Expected REC Quantity for such first Delivery Year shall reflect an annualized number based on allocating the Designated System Contract Maximum REC Quantity across 15 years using a degradation factor of half of one percent (0.5%) annually. If the Delivery Term extends beyond a 15-Delivery Year schedule starting with that first Delivery Year, then each subsequent Delivery Year Expected REC Quantity subsequent to the 15th Delivery Year shall reflect a quantity that provides for a degradation factor of half of one percent (0.5%) from the prior Delivery Year Expected REC Quantity (a sample delivery schedule is provided in Exhibit F).
(d) . Once annually on or prior to November 15 following a Delivery Year, the IPA or its designee shall review the performance of the REC deliveries made during such Delivery Year Year, using information provided in the REC Annual Report submitted pursuant to Section 10(c) of the Cover Sheet, and determine the amount of Aggregate Drawdown Payment due as follows:
(i) : For each Designated System that has been Energized and three (3) full Delivery Years has have occurred since the start of the Delivery Term of such Designated System, the IPA or its designee shall calculate, with respect to a Delivery Year, a Delivery Year REC Performance for such Delivery Year (an example Delivery Year REC Performance calculation is provided in Exhibit G);
(ii) ; With respect to a Designated System that has been Energized and three (3) full Delivery Years has have occurred since the start of the Delivery Term of such Designated System, in the event that the Delivery Year REC Performance is greater than the applicable Delivery Year Expected REC Quantity, the difference in the number of RECs shall be the “Delivery Year Surplus Amount” and each REC included in the Delivery Year Surplus Amount shall be a “Surplus REC”;
(iii) ; With respect to a Designated System that has been Energized and three (3) full Delivery Years has have occurred since the start of the Delivery Term of such Designated System, in the event that the Delivery Year REC Performance is less than the Delivery Year Expected REC Quantity, the difference in the number of RECs shall be the “Delivery Year Shortfall Amount”;
(iv) ; For each Designated System that has a Delivery Year Shortfall Amount, starting with the Designated System with the lowest Contract Price, Surplus RECs from the Surplus REC Account shall be reduced and allocated to meet such Delivery Year Shortfall Amount, REC for REC. If there are insufficient Surplus RECs to meet the Delivery Year Shortfall Amount, then the number of RECs calculated as the difference between the Delivery Year Shortfall Amount and the sum of such Surplus RECs being applied to meet the Delivery Year Shortfall Amount is the “Drawdown REC Quantity”, and the multiplicative product of the Drawdown REC Quantity and the Contract Price of such Designated System is the “Drawdown Payment”; and
(v) and At the end of the foregoing process:
: Buyer shall inform Seller of the Aggregate Drawdown Payment (1including any Drawdown Payment pursuant to Section 6(d)(iv) of the Cover Sheet and any Drawdown Payment pursuant to Section 6(e) of the Cover Sheet) by written notice and Seller may, within five (5) Business Days of such written notice, request for payment of the Aggregate Drawdown Payment to be made by additional cash transfer by Seller to Buyer or request for the payment of the Aggregate Drawdown Payment to be made from the cash or the Letter of Credit held as Seller’s Performance Assurance if both cash and a Letter of Credit are held as Seller’s Performance Assurance. If Buyer does not receive such request from Seller within such five (5) Business Day period, or if Seller makes a request within the five (5) Business Day period to pay with cash and then fails to remit the full cash payment by the fourteenth (14th) Business Day after Buyer’s written notice to Seller, Buyer shall draw on Seller’s Performance Assurance to reach the full amount of the Aggregate Drawdown Payment. If Buyer does receive such request from Seller for a draw on a particular form of Performance Assurance within such five (5) Business Day period, then Buyer shall draw on Seller’s Performance Assurance in the amount form requested. In all cases of a draw on Performance Assurance, the Aggregate Drawdown Paymentdraw shall be made on or after the fifteenth (15th) Business Day after Buyer’s written notice to Seller. Seller shall be required to replenish Seller’s Performance Assurance in accordance with Section 4.3 of the Master REC Agreement. If Seller’s Performance Assurance is less than the Aggregate Drawdown Payment, or if Seller has requested to make such payments by additional cash transfer, then Seller shall pay Buyer the difference or the amount of such payments, respectively, within fifteen
fifteen (15) Business Days of notice by Buyer. Failure by Seller to pay Buyer shall be an Event of Default subject to the Termination remedies under this REC Contract Contract. Notwithstanding the foregoing, if this is not the last Delivery Year under this REC Contract and the amount of the Aggregate Drawdown Payment is less than $5,000, then Buyer shall not draw on Seller’s Performance Assurance, but will track such amount and add such amount to the Aggregate Drawdown Payment for the subsequent Delivery Year or Delivery Years until the earlier of: the last Delivery Year or such time when the Aggregate Drawdown Payment is at least $5,000;
(2) ; For purposes of calculating the Delivery Year REC Performance in future Delivery Years, each Designated System that has a Delivery Year Shortfall Amount for which such Delivery Year Shortfall Amount is covered by Surplus REC(s) and/or for which a payment from Seller or from Seller’s Performance Assurance has been applied to the Drawdown REC Quantity, such Designated System is deemed to have Delivered REC quantities equal to the Delivery Year Expected REC Quantity in such Delivery Year.
(e) . If a Designated System is a Community Renewable Energy Generation Project, such Designated System must maintain at least the Community Solar Subscription Mix Mix, the percent of Actual Nameplate Capacity that has been subscribed by the Anchor Tenant and the percent of Actual Nameplate Capacity that has been subscribed by End Use Customers as provided in the last Community Solar Quarterly First Year Report submitted pursuant to Section 10(b) of the Cover Sheet throughout the remainder of the Delivery Term after the issuance of such Community Solar Quarterly First Year Report. Failure to maintain the Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed by the Anchor Tenant and the percent of Actual Nameplate Capacity that has been subscribed by End Use Customers as provided in the last Community Solar Quarterly First Year Report submitted pursuant to Section 10(b) of the Cover Sheet in a Delivery Year shall result in payment to Buyer from Seller of a monetary amount, determined by the IPA or its designeeIPA, and Buyer may draw on Seller’s Performance Assurance for this purpose. The Designated System must maintain the minimum Community Solar Subscription Mix required under the SFA for the REC price adder obtained in the Non-Anchor Tenant Contract Price that resulted from the Community Solar Subscription Mix indicated in the Community Solar First Year Report; the Designated System must also maintain the subscription shares of the Anchor Tenant and End Use Customers as indicated in the Community Solar First Year Report. For each Delivery Year after the issuance of the last Community Solar Quarterly First Year Report submitted pursuant to Section 10(b) of the Cover Sheet, then, using the subscription percentage REC Annual Report submitted under Section 10(c) of the Cover Sheet and at the same time as the calculations made under Section 6(d) of the Cover Sheet: the Community Solar Subscription Mix as well as the subscription share percentages of the Anchor Tenant and End Use Customers will each be calculated by the IPA as a daily average, then averaged over the Delivery Year, . This daily average will be based on actual subscription start and end dates comprised of the day that a subscription start or end request was submitted to the utility, as entered in the REC Annual Report. The draw on Seller’s Performance Assurance will be calculated as the sum of the following: (i) the difference between (a) the contracted payment for Community Solar Anchor Payment allocable to that Delivery Year and (b) the amount that would have been paid for the Anchor Tenant’s subscription share for that Delivery Year given the percent of Actual Nameplate Capacity that has been subscribed by Anchor Tenant in that Delivery Year, if (a) exceeds (b); and (ii) the difference between (x) the Community Solar Non-Anchor Payment allocable to that Delivery Year and (y) the amount that would have been paid for the End Use Customers’ subscription share for that Delivery Year given the realized Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribedsubscribed by End Use Customers in that Delivery Year, if (ax) exceeds (by). (Provided, that the draw on Seller’s Performance Assurance will simply equal the total payment allocable to that Delivery Year if the percent of Non-Anchor Nameplate Capacity that has been subscribed by End Use Customers in that Delivery Year is less than fifty percent (50%); but if this deficiency is due to the loss of an Anchor Tenant in the Delivery Year, the Seller shall have a specified period determined by the IPA from the end of the Delivery Year to cure the deficiency before such a draw is made. If the percent of Non-Anchor Nameplate Capacity that has been subscribed by End Use Customers is at least fifty percent (50%) at the end of such cure period, the draw on Seller’s Performance Assurance will be calculated as the sum of the following: (i) the difference between (a) the Community Solar Anchor Payment allocable to that Delivery Year and (b) the amount that would have been paid for the Anchor Tenant’s subscription share for that Delivery Year given the percent of Actual Nameplate Capacity that has been subscribed by Anchor Tenant in that Delivery Year); and (ii) the difference between (x) the Community Solar Non-Anchor Payment allocable to that Delivery Year and (y) the amount that would have been paid for the End Use Customers’ subscription share for that Delivery Year given the realized Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed by End Use Customers in that Delivery Year, if (x) exceeds (y), but will not be the total payment allocable to that Delivery Year.) This amount will be calculated in arrears for only the immediately preceding Delivery Year covered by the REC Annual Report. If a Designated System meets a Community Solar Subscription Mix requirement for a lower REC price adder than what was obtained following the Community Solar First Year Report, it will be deemed to have obtained that lower adder for the Delivery Year for the purposes of calculating the draw above. If the Designated System regains a Community Solar Subscription mix and subscription percentage at or above their contracted amount in subsequent years, a drawdown will not occur in those years; however, overperformance in a Delivery Year will not be banked or applied to past Delivery Years. Designated Systems with total subscription levels (including only subscription shares of the Anchor Tenant and End Use Customers) above 90% of Actual Nameplate Capacity on a kW capacity basis for a Delivery Year will not be subject to a draw on Seller’s Performance Assurance for that Delivery Year on the basis of subscription percentage. This calculation will only occur after the final Contract Price and quantity of RECs due payment are determined per section 5(e)(iv)(DSection 5(f)(iii) of the Cover Sheet and will be based on that final Contract Price and quantity which is determined by the last Community Solar Quarterly First Year Report submitted pursuant to Section 10(b) of the Cover Sheet.
(f) During . Notwithstanding any of the Delivery Termforegoing, Seller may determine that a Designated System is not performing at the level expected. In such case, Seller may submit a request to Buyer and the IPA (or its designee) to have the Delivery obligations of such Designated System reduced, and if the request is accepted by Buyer, such request shall be in exchange for the return by Seller to Buyer total combined percent of an agreed upon payment adjustment if payment Actual Nameplate Capacity that has been made subscribed by Buyer the Anchor Tenant and by End Use Customers has decreased for RECs from a Delivery Year and such Designated System. Such request shall include pertinent information related decrease is no more than three percentage points (3% points) relative to the payment adjustment as well as requested changes to future Delivery Year Expected REC Quantity and Contract Nameplate Capacity. Any such request shall be deemed approved upon Buyer’s receipt total combined percent of such agreed upon payment adjustment, and information regarding the receipt of and the calculation of the agreed upon payment adjustment shall be communicated to the IPA and its designee. Any such changes in the delivery schedule and adjustments made to future Delivery Year Expected REC Quantity and Contract Actual Nameplate Capacity shall be documented in an amended Schedule B to the Product Order applicable to such Designated System issued that has been subscribed by the IPA or its designee to Buyer Anchor Tenant and Seller.
(g) Surplus RECs are virtually tracked in the Surplus REC Account and shall remain, except by End Use Customers as provided in Section 9.2 of the Master REC Agreement, in such account until a reduction in such Surplus RECs is recorded by the IPA or its designee to meet a Delivery Community Solar First Year Shortfall Amount.
(h) Upon the conclusion of the annual review process Report submitted pursuant to Section 6(d10(b) above of the Cover Sheet, then no draw shall occur pursuant to this Section 6(e) for such Delivery Year as long as the total combined percent of Actual Nameplate Capacity that has been subscribed by the Anchor Tenant and by End Use Customers for the last immediately following Delivery Year under this REC Contract, if (i) there are Surplus RECs remaining in the Surplus REC Account and (ii) an Aggregate Drawdown Payment has occurred during the Term of this REC Contract, then the IPA or its designee shall calculate a monetary refund adjustment due to Seller from Buyer. Buyer shall credit Seller for each Surplus REC that can be applied to a REC associated with a Drawdown Payment. For purpose of calculating the refund, Surplus RECs from the Surplus REC Account shall be reduced and applied is at least equal to the RECs total combined percent of Actual Nameplate Capacity that are associated with a Drawdown Payment, starting with the REC with the lowest Contract Price, REC for REC. The monetary refund adjustment shall be paid from Buyer to Seller by December 31 following the conclusion of the last annual review process. For avoidance of doubt, no payment shall be made for any Surplus RECs that remain in the Surplus REC Account after the refund adjustment is calculated.has been subscr
Appears in 1 contract
Sources: Renewable Energy Credit Agreement
Deliveries and Quantity. (a) Seller will Deliver the quantity of each Product specified in Table 1 and Buyer will pay the specified Purchase Price for such Product, all in accordance with this REC Contract. RECs generated from the Small Size Class cannot be substituted for RECs generated from the Large Size Class (and vice versa). For each Designated System that has been EnergizedDelivery Year, except as set forth in Section 4(d), the RECs must be generated between the applicable dates specified in Table 1 (all such required generation dates referred to as the “Vintage”) and must be Delivered on or before the Delivery of at least one Date for the Spring Delivery Season for such Delivery Year.
(1b) REC from such Designated System is expected Notwithstanding the foregoing, for the first Delivery Year only, Seller shall provide written notification to occur Buyer with each invoice (with a copy provided to the Buyer’s PJM-IPA) regarding whether Seller has completed the registration process in PJM EIS GATS account or M-RETS account, as applicable, within 90 calendar days of when such Designated System was Energized if the Actual Nameplate Capacity of such Designated System is greater than 5kW or within 180 calendar days of when the Designated System was Energized if the Actual Nameplate Capacity of such Designated System is equal to or less than 5kW. For for each Designated System such that fails to Deliver at least (1) one REC from such Designated System by the applicable deadlineinitial meter read date as recorded in PJM EIS GATS or M-RETS occurs on or before May 31, Seller must provide to Buyer and the IPA or its designee, with respect to such Designated System, a written notice within sixty (60) days of the applicable deadline to Deliver at least one (1) REC confirming that there are no technical issues, with respect to such Designated System, known to Seller that would impede the generation, issuance and Delivery of RECs from such Designated System or that such technical issues have been resolved by Seller2017. In the event that (i) Seller fails to provide such written notice within sixty complete the registration process in PJM EIS GATS or M- RETS for a Designated System by the time the last invoice for the first Delivery Year is submitted or (60ii) days of the applicable deadline to Deliver at least one (1) RECinitial meter read date for a Designated System as recorded in PJM EIS GATS or M-RETS occurs after May 31, then the number of RECs associated with 2017, such Designated System shall will be deemed removed from this REC Contract and Buyer the Delivery Year Quantity of RECs specified in Table 1 shall be entitled to payment reduced by Seller in the amount of the greater of: (i) the Collateral Requirement for such Designated System or (ii) one hundred percent (100%) of the total payments Seller has received from Buyer RECs associated with RECs from such Designated System.
(b) For each Designated System that has been Energized, all RECs designated to be Delivered pursuant to the Standing Order associated with such Designated System shall be Delivered to Buyer commencing from the date such Standing Order is established through the end of the Delivery Term of such Designated System regardless of whether the total payment made by Buyer to Seller for RECs from such Designated System is commensurate with the actual number of RECs Delivered from such Designated System.
(c) For The following shall constitute an Event of Default: (i) Seller’s failure to Deliver eighty percent (80%) of the separate Delivery Year Quantity for each Designated System that has been Energized, a REC delivery schedule of the Size Classes by the Delivery Date for the Spring Delivery Season or (ii) if the separate Delivery Year Quantity for one of the Size Classes is provided in Schedule B to less than ten percent (10%) of the Product Order applicable to such Designated System that contains the expected number of RECs to be Delivered through the end sum of the Delivery Term where Year Quantities for both Size Classes for such Delivery Year or if the number of RECs expected to be Delivered in each Delivery Year Quantities for both Size Classes for such Delivery Year is based on the Designated System Contract Maximum REC Quantity and a degradation factor of half of one less than 100 RECs, Seller’s failure to Deliver eighty percent (0.580%) annually, and rounded down to of the nearest whole REC in each Delivery Year. The REC quantities expected to be Delivered from such Designated System in a sum of the Delivery Year shall be the “Delivery Year Expected REC Quantity” Quantities for both Size Classes for such Delivery Year. For avoidance of doubt, with respect to a Designated System, Year by the Delivery Year Expected REC Quantities Date for the Spring Delivery Season; in the delivery schedule are determined at the time of Energization and not when the Delivery Term starts. As sucheach case, for purposes of calculating the as any such Delivery Year Expected REC Quantity for each Delivery Year, the Delivery Year in which the date of Energization occurred shall may be the first Delivery Year for which a Delivery Year Expected REC Quantity is calculated and the Delivery Year Expected REC Quantity for such first Delivery Year shall reflect an annualized number based on allocating the Designated System Contract Maximum REC Quantity across 15 years using a degradation factor of half of one percent (0.5%) annually. If the Delivery Term extends beyond a 15-Delivery Year schedule starting with that first Delivery Year, then each subsequent Delivery Year Expected REC Quantity subsequent reduced pursuant to the 15th Delivery Year shall reflect a quantity that provides for a degradation factor of half of one percent (0.5%) from the prior Delivery Year Expected REC Quantity (a sample delivery schedule is provided in Exhibit FSection 4(b).
(d) Once annually on or prior to November 15 following a For each Delivery Year, Buyer shall pay Seller for Product up to the IPA or its designee shall review the performance of the REC deliveries made during such Delivery Year and determine the amount of Aggregate Drawdown Payment due as follows:
(i) For each Designated System Quantity for such Product. Any RECs Delivered in a Delivery Year that has been Energized and three (3) full Delivery Years has occurred since the start are in excess of the Delivery Term of such Designated System, the IPA or its designee shall calculate, with respect Year Quantity may be used to a Delivery Year, a Delivery Year REC Performance for such Delivery Year (an example Delivery Year REC Performance calculation is provided in Exhibit G);
(ii) With respect to a Designated System that has been Energized and three (3) full Delivery Years has occurred since the start of the Delivery Term of such Designated System, in the event that satisfy the Delivery Year REC Performance is greater than the applicable Delivery Year Expected REC Quantity, the difference in the number of RECs shall be the “Delivery Year Surplus Amount” and each REC included in the Delivery Year Surplus Amount shall be a “Surplus REC”;
(iii) With respect to a Designated System that has been Energized and three (3) full Delivery Years has occurred since the start of the Delivery Term of such Designated System, in the event that the Delivery Year REC Performance is less than the Delivery Year Expected REC Quantity, the difference in the number of RECs shall be the “Delivery Year Shortfall Amount”;
(iv) For each Designated System that has a Delivery Year Shortfall Amount, starting with the Designated System with the lowest Contract Price, Surplus RECs from the Surplus REC Account shall be reduced and allocated to meet such Delivery Year Shortfall Amount, REC for REC. If there are insufficient Surplus RECs to meet the Delivery Year Shortfall Amount, then the number of RECs calculated as the difference between the Delivery Year Shortfall Amount and the sum of such Surplus RECs being applied to meet the Delivery Year Shortfall Amount is the “Drawdown REC Quantity”, and the multiplicative product of the Drawdown REC Quantity and the Contract Price of such Designated System is the “Drawdown Payment”; and
(v) At the end of the foregoing process:
(1) Buyer shall draw on Seller’s Performance Assurance in the amount of the Aggregate Drawdown Payment. Seller shall be required to replenish Seller’s Performance Assurance in accordance with Section 4.3 of the Master REC Agreement. If Seller’s Performance Assurance is less than the Aggregate Drawdown Payment, then Seller shall pay Buyer the difference within fifteen
(15) Business Days of notice by Buyer. Failure by Seller to pay Buyer shall be an Event of Default subject to the Termination remedies under this REC Contract Notwithstanding the foregoing, if this is not the last Delivery Year under this REC Contract and the amount of the Aggregate Drawdown Payment is less than $5,000, then Buyer shall not draw on Seller’s Performance Assurance, but will track such amount and add such amount to the Aggregate Drawdown Payment for the subsequent Delivery Year or Delivery Years until the earlier of: the last Year. Small Size Class—Systems Less Than 25 KW Nameplate Capacity (DC Rating) Purchase Price ($ per REC) [$ ] Delivery Year or such time when the Aggregate Drawdown Payment is at least $5,000;
(2) For purposes of calculating the Delivery Year REC Performance in future Delivery YearsQuantity (# of RECs) Tracking System Vintage June 2016 through May 2017 [ ] [ ] June 1, each Designated System that has a 2016 and May 31, 2017 June 2017 through May 2018 [ ] [ ] June 1, 2017 and May 31, 2018 June 2018 through May 2019 [ ] [ ] June 1, 2018 and May 31, 2019 June 2019 through May 2020 [ ] [ ] June 1, 2019 and May 31, 2020 June 2020 through May 2021 [ ] [ ] June 1, 2020 and May 31, 2021 Large Size Class—Systems Greater Than or Equal to 25 KW Nameplate Capacity (DC Rating) Purchase Price ($ per REC) [$ ] Delivery Year Shortfall Amount for which such Delivery Year Shortfall Amount is covered by Surplus REC(sQuantity (# of RECs) and/or for which a payment from Seller or from Seller’s Performance Assurance has been applied to the Drawdown REC QuantityTracking System Vintage June 2016 through May 2017 [ ] [ ] June 1, such Designated System is deemed to have Delivered REC quantities equal to the Delivery Year Expected REC Quantity in such Delivery Year.
(e) If a Designated System is a Community Renewable Energy Generation Project2016 and May 31, such Designated System must maintain at least the Community Solar Subscription Mix 2017 June 2017 through May 2018 [ ] [ ] June 1, 2017 and the percent of Actual Nameplate Capacity that has been subscribed as provided in the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet throughout the remainder of the Delivery Term after the issuance of such Community Solar Quarterly Report. Failure to maintain the Community Solar Subscription Mix May 31, 2018 June 2018 through May 2019 [ ] [ ] June 1, 2018 and the percent of Actual Nameplate Capacity that has been subscribed as provided in the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet in a Delivery Year shall result in payment to Buyer from Seller of a monetary amountMay 31, determined by the IPA or its designee2019 June 2019 through May 2020 [ ] [ ] June 1, 2019 and Buyer may draw on Seller’s Performance Assurance for this purpose. For each Delivery Year after the issuance of the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover SheetMay 31, the subscription percentage 2020 June 2020 through May 2021 [ ] [ ] June 1, 2020 and Community Solar Subscription Mix will each be calculated as a daily averageMay 31, then averaged over the Delivery Year, based on actual subscription start and end dates entered in the REC Annual Report. The draw on Seller’s Performance Assurance will be calculated as the difference between (a) the contracted payment for that Delivery Year and (b) the amount that would have been paid given the realized Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed, if (a) exceeds (b). This amount will be calculated in arrears for only the immediately preceding Delivery Year covered by the REC Annual Report. If the Designated System regains a Community Solar Subscription mix and subscription percentage at or above their contracted amount in subsequent years, a drawdown will not occur in those years; however, overperformance in a Delivery Year will not be banked or applied to past Delivery Years. Designated Systems with subscription levels above 90% of Actual Nameplate Capacity on a kW capacity basis for a Delivery Year will not be subject to a draw on Seller’s Performance Assurance for that Delivery Year on the basis of subscription percentage. This calculation will only occur after the final Contract Price and quantity of RECs due payment are determined per section 5(e)(iv)(D) of the Cover Sheet and will be based on that final Contract Price and quantity which is determined by the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet.
(f) During the Delivery Term, Seller may determine that a Designated System is not performing at the level expected. In such case, Seller may submit a request to Buyer and the IPA (or its designee) to have the Delivery obligations of such Designated System reduced, and if the request is accepted by Buyer, such request shall be in exchange for the return by Seller to Buyer of an agreed upon payment adjustment if payment has been made by Buyer for RECs from such Designated System. Such request shall include pertinent information related to the payment adjustment as well as requested changes to future Delivery Year Expected REC Quantity and Contract Nameplate Capacity. Any such request shall be deemed approved upon Buyer’s receipt of such agreed upon payment adjustment, and information regarding the receipt of and the calculation of the agreed upon payment adjustment shall be communicated to the IPA and its designee. Any such changes in the delivery schedule and adjustments made to future Delivery Year Expected REC Quantity and Contract Nameplate Capacity shall be documented in an amended Schedule B to the Product Order applicable to such Designated System issued by the IPA or its designee to Buyer and Seller.
(g) Surplus RECs are virtually tracked in the Surplus REC Account and shall remain, except as provided in Section 9.2 of the Master REC Agreement, in such account until a reduction in such Surplus RECs is recorded by the IPA or its designee to meet a Delivery Year Shortfall Amount.
(h) Upon the conclusion of the annual review process pursuant to Section 6(d) above for the last Delivery Year under this REC Contract, if (i) there are Surplus RECs remaining in the Surplus REC Account and (ii) an Aggregate Drawdown Payment has occurred during the Term of this REC Contract, then the IPA or its designee shall calculate a monetary refund adjustment due to Seller from Buyer. Buyer shall credit Seller for each Surplus REC that can be applied to a REC associated with a Drawdown Payment. For purpose of calculating the refund, Surplus RECs from the Surplus REC Account shall be reduced and applied to the RECs that are associated with a Drawdown Payment, starting with the REC with the lowest Contract Price, REC for REC. The monetary refund adjustment shall be paid from Buyer to Seller by December 31 following the conclusion of the last annual review process. For avoidance of doubt, no payment shall be made for any Surplus RECs that remain in the Surplus REC Account after the refund adjustment is calculated.2021
Appears in 1 contract
Sources: Renewable Energy Credit Agreement
Deliveries and Quantity. (a) For each Designated System that has been Energized, the Delivery of at least one (1) REC from such Designated System is expected to occur to the Buyer’s PJM-EIS GATS account or M-RETS account, as applicable, within 90 calendar days of when such Designated System was Energized if the Actual Contract Nameplate Capacity of such Designated System is greater than 5kW or within 180 calendar days of when the Designated System was Energized if the Actual Contract Nameplate Capacity of such Designated System is equal to or less than 5kW. For each Designated System that fails to Deliver at least (1) one REC from such Designated System by the applicable deadlineSystem, Seller must provide to Buyer and the IPA or its designee, with respect to such Designated System, a written notice within sixty thirty (6030) days of the applicable deadline to Deliver at least one (1) REC confirming that there are no technical issues, with respect to such Designated System, known to Seller that would impede the generation, issuance and Delivery of RECs from such Designated System or that such technical issues have has been resolved by Seller. In the event that Seller fails to provide such written notice within sixty (60) days of the applicable deadline to Deliver at least one (1) REC, then the number of RECs associated with such Designated System shall be deemed removed from this REC Contract and Buyer shall be entitled to payment by Seller in the amount of the greater of: (i) the Collateral Requirement for such Designated System or (ii) one hundred percent (100%) of the total payments Seller has received from Buyer associated with RECs from such Designated System.;
(b) For each Designated System that has been Energized, all RECs designated to be Delivered pursuant to the Standing Order then in effect associated with such Designated System shall be Delivered to Buyer commencing from the date such Standing Order is established through the end of the Delivery Term of such Designated System regardless of whether the total payment made by Buyer to Seller for RECs from such Designated System is commensurate with the actual number of RECs Delivered from such Designated System.. For the avoidance of doubt, to the extent that Seller is entitled to reduce the RECs delivered under the Standing Order to Buyer, Buyer (i) shall promptly take such steps as are necessary to effectuate any change in the Standing Order, and (ii) not be entitled to any RECs produced by Designated System not covered by the Standing Order then in effect;
(c) For each Designated System that has been Energized, a REC delivery schedule is provided in Schedule B to the associated Product Order applicable to such Designated System that contains the expected number of RECs to be Delivered through the end of the Delivery Term where the number of RECs expected to be Delivered in each Delivery Year is based on the Designated System applicable Capacity Factor, Contract Maximum REC Quantity Nameplate Capacity and a degradation factor of half of one percent (0.5%) annually, and rounded down to the nearest whole REC in each Delivery YearREC. The REC quantities expected to be Delivered from such Designated System in a Delivery Year shall be the “Delivery Year Expected REC Quantity” for such Delivery Year. For avoidance of doubt, with respect to a Designated System, the Delivery Year Expected REC Quantities in the delivery schedule are determined at the time of Energization and not when the Delivery Term starts. As such, for purposes of calculating the Delivery Year Expected REC Quantity for each Delivery Year, the Delivery Year in which the date of Energization occurred shall be the first Delivery Year for which a Delivery Year Expected REC Quantity is calculated and the Delivery Year Expected REC Quantity for such first Delivery Year shall reflect an annualized number based on allocating the Designated System Contract Maximum REC Quantity across 15 years using a degradation factor of half of one percent (0.5%) annually. If the Delivery Term extends beyond a 15-Delivery Year schedule starting with that first Delivery Year, then each subsequent Delivery Year Expected REC Quantity subsequent to the 15th Delivery Year shall reflect a quantity that provides for a degradation factor of half of one percent (0.5%) from the prior Delivery Year Expected REC Quantity (a sample delivery schedule Delivery Schedule is provided in Exhibit F).;
(d) Once annually on or prior to November 15 following a Delivery Year, the IPA or its designee shall review the performance of the REC deliveries made during such Delivery Year and determine the amount of Aggregate Drawdown Payment payment due as follows:
(i) For each Designated System that has been Energized and three (3) full Delivery Years has occurred since the start of the Delivery Term of such Designated SystemEnergized, the IPA or its designee shall calculate, with respect to a Delivery Year, a Delivery Year REC Performance for such Delivery Year (an example Delivery Year REC Performance calculation is provided in Exhibit G);
(ii) With respect to a Designated System that has been Energized and three (3) full Delivery Years has occurred since the start of the Delivery Term of such Designated System, in the event that the Delivery Year REC Performance is greater than the applicable Delivery Year Expected REC Quantity, the difference in the number amount of RECs REC quantities shall be the “Delivery Year Surplus Amount” and each REC included issued in the Delivery Year Surplus Amount excess shall be a “Surplus REC”. For avoidance of doubt, RECs that are issued later in the Delivery Year are to be considered first as Surplus RECs ahead of RECs issued earlier in the Delivery Year if the Delivery Year Surplus Amount exceeds the number of RECs that are of the latest vintage as recorded by PJM EIS GATS or M-RETS for such Delivery Year. Surplus RECs are tracked in the Surplus REC Account and shall remain in such account until a reduction in such Surplus RECs are recorded by the IPA or its designee to meet a Delivery Year Shortfall Amount;
(iii) With respect to a Designated System that has been Energized and three (3) full Delivery Years has occurred since the start of the Delivery Term of such Designated System, in the event that the sum of the current year’s plus the previous two years’ Delivery Year REC Performance is less than the sum of the current year’s plus the previous two years’ Delivery Year Expected REC Quantity, the difference in the number amount of RECs REC quantities shall be the “Delivery Year Shortfall Amount;”,” which shall not be calculated until the third anniversary of Energization;
(iv) For each Designated System that has a Delivery Year Shortfall Amount, starting with the Designated System with the lowest Contract Price, Surplus RECs from the Surplus REC Account shall be reduced and allocated to meet such Delivery Year Shortfall Amount, REC for REC. If there are insufficient Surplus RECs to meet the Delivery Year Shortfall Amount, then the number amount of RECs REC quantity calculated as the difference between the Delivery Year Shortfall Amount and the sum of such Surplus RECs being applied to meet the Delivery Year Shortfall Amount is the “Drawdown REC Quantity”, and the multiplicative product of the Drawdown REC Quantity and the Contract Price of such Designated System is the “Drawdown Payment”; and
(v) At the end of the foregoing process:
(1) Buyer shall draw on Seller’s Performance Assurance in the amount of the Aggregate Drawdown Payment. Seller shall be required to replenish Seller’s Performance Assurance in accordance with Section 4.3 of the Master REC Agreementas provided herein. If Seller’s Performance Assurance is less than the Aggregate Drawdown Payment, then Seller shall pay Buyer the difference within fifteen
ten (1510) Business Days of notice by Buyer. Failure by Seller to pay Buyer shall be an Event of Default subject to the Termination remedies under this REC Contract Notwithstanding the foregoing, if this is not the last Delivery Year under this REC Contract and the amount of the Aggregate Drawdown Payment is less than $5,000, then Buyer shall not draw on Seller’s Performance Assurance, but will track such amount and add such amount to the Aggregate Drawdown Payment for the subsequent Delivery Year or Delivery Years until the earlier of: the last Delivery Year or such time when the Aggregate Drawdown Payment is at least $5,000;Contract; and
(2) For purposes of calculating the Delivery Year REC Performance in the future Delivery Yearsyears, each Designated System that has a Delivery Year Shortfall Amount for which such Delivery Year Shortfall Amount is covered by Surplus REC(s) RECs and/or for which a payment from Seller or from Seller’s Performance Assurance has been applied to the Drawdown REC Quantity, such Designated System is deemed to have Delivered REC quantities equal to the Delivery Year Expected REC Quantity in such Delivery Year.
(e) If a Designated System is a Community Renewable Energy Generation Project, such Designated System must maintain at least the Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed as provided in the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet throughout the remainder of the Delivery Term after the issuance first year of such Community Solar Quarterly Reportoperations. subject to the calculation of Subscription Levels in Section XX. Failure to maintain the Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed as provided in the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet in a Delivery Year shall result in payment to Buyer from Seller of a monetary amount, determined by the IPA or its designee, and Buyer may draw on Seller’s Performance Assurance for this purpose. For each Delivery Year after the issuance of the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet, the subscription percentage and Community Solar Subscription Mix will each be calculated as a daily average, then averaged over the Delivery Year, based on actual subscription start and end dates entered in the REC Annual Report. The draw on Seller’s Performance Assurance will be calculated as the difference between (a) the contracted payment for that Delivery Year and (b) the amount that would have been paid given the realized Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed, if (a) exceeds (b). This amount will be calculated in arrears for only the immediately preceding Delivery Year covered by the REC Annual Report. If the Designated System regains a Community Solar Subscription mix and subscription percentage at or above their contracted amount in subsequent years, a drawdown will not occur in those years; however, overperformance in a Delivery Year will not be banked or applied to past Delivery Years. Designated Systems with subscription levels above 90% of Actual Nameplate Capacity on a kW capacity basis for a Delivery Year will not be subject to a draw on Seller’s Performance Assurance for that Delivery Year on the basis of subscription percentage. This calculation will only occur after the final Contract Price and quantity of RECs due payment are determined per section 5(e)(iv)(D) of the Cover Sheet and will be based on that final Contract Price and quantity which is determined by the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet.
(f) During the Delivery Term, Seller may determine that a Designated System is not performing at the level expected. In such case, Seller may submit a request to Buyer and the IPA (or its designee) to have the Delivery obligations of such Designated System reduced, and if the request is accepted by Buyer, such request shall be reduced in exchange for the return by Seller to Buyer of an agreed upon payment adjustment if payment has been made by Buyer for RECs from such Designated System. Such request shall include pertinent information related to the payment adjustment as well as requested changes to future Delivery Year Expected REC Quantity and Contract Nameplate Capacity. Any such request shall be deemed approved upon Buyer’s receipt of such agreed upon payment adjustment, and information regarding the receipt of and the calculation of the agreed upon payment adjustment shall be communicated to the IPA and its designee. Any such changes in the delivery schedule and adjustments made to future Delivery Year Expected REC Quantity and Contract Nameplate Capacity shall be documented in an amended Schedule B to the Product Order applicable to such Designated System issued by the IPA or its designee to Buyer and Seller.
(g) Surplus RECs are virtually tracked in the Surplus REC Account and shall remain, except as provided in Section 9.2 of the Master REC Agreement, in such account until a reduction in such Surplus RECs is recorded by the IPA or its designee to meet a Delivery Year Shortfall Amount.
(h) Upon the conclusion of the annual review process pursuant to Section 6(d) above for the last Delivery Year under this REC Contract, if (i) there are Surplus RECs remaining in the Surplus REC Account and (ii) an Aggregate Drawdown Payment has occurred during the Term of this REC Contract, then the IPA or its designee shall calculate a monetary refund adjustment due to Seller from Buyer. Buyer shall credit Seller for each Surplus REC that can be applied to a REC associated with a Drawdown Payment. For purpose of calculating the refund, Surplus RECs from the Surplus REC Account shall be reduced and applied to the RECs that are associated with a Drawdown Payment, starting with the REC with the lowest Contract Price, REC for REC. The monetary refund adjustment shall be paid from Buyer to Seller by December 31 following the conclusion of the last annual review process. For avoidance of doubt, no payment shall be made for any Surplus RECs that remain in the Surplus REC Account after the refund adjustment is calculated.
Appears in 1 contract
Sources: Renewable Energy Credit Agreement
Deliveries and Quantity. (a) For each Designated System that has been Energized, the Delivery of at least one (1) REC from such Designated System is expected to occur to the Buyer’s PJM-EIS GATS account or M-RETS account, as applicable, within 90 calendar days of when such Designated System was Energized if the Actual Contract Nameplate Capacity of such Designated System is greater than 5kW or within 180 calendar days of when the Designated System was Energized if the Actual Contract Nameplate Capacity of such Designated System is equal to or less than 5kW. For each Designated System that fails to Deliver at least (1) one REC from such Designated System by the applicable deadlineSystem, Seller must provide to Buyer and the IPA or its designee, with respect to such Designated System, a written notice within sixty thirty (6030) days of the applicable deadline to Deliver at least one one
(1) REC confirming that there are no technical issues, with respect to such Designated System, known to Seller that would impede the generation, issuance and Delivery of RECs from such Designated System or that such technical issues have has been resolved by Seller. In the event that Seller fails to provide such written notice within sixty (60) days of the applicable deadline to Deliver at least one (1) REC, then the number of RECs associated with such Designated System shall be deemed removed from this REC Contract and Buyer shall be entitled to payment by Seller in the amount of the greater of: (i) the Collateral Requirement for such Designated System or (ii) one hundred percent (100%) of the total payments Seller has received from Buyer associated with RECs from such Designated System.;
(b) For each Designated System that has been Energized, all RECs designated to be Delivered pursuant to the Standing Order associated with such Designated System shall be Delivered to Buyer commencing from the date such Standing Order is established through the end of the Delivery Term of such Designated System regardless of whether the total payment made by Buyer to Seller for RECs from such Designated System is commensurate with the actual number of RECs Delivered from such Designated System.;
(c) For each Designated System that has been Energized, a REC delivery schedule is provided in Schedule B to the associated Product Order applicable to such Designated System that contains the expected number of RECs to be Delivered through the end of the Delivery Term where the number of RECs expected to be Delivered in each Delivery Year is based on the Designated System applicable Capacity Factor, Contract Maximum REC Quantity Nameplate Capacity and a degradation factor of half of one percent (0.5%) annually, and rounded down to the nearest whole REC in each Delivery YearREC. The REC quantities expected to be Delivered from such Designated System in a Delivery Year shall be the “Delivery Year Expected REC Quantity” for such Delivery Year. For avoidance of doubt, with respect to a Designated System, the Delivery Year Expected REC Quantities in the delivery schedule are determined at the time of Energization and not when the Delivery Term starts. As such, for purposes of calculating the Delivery Year Expected REC Quantity for each Delivery Year, the Delivery Year in which the date of Energization occurred shall be the first Delivery Year for which a Delivery Year Expected REC Quantity is calculated and the Delivery Year Expected REC Quantity for such first Delivery Year shall reflect an annualized number based on allocating the Designated System Contract Maximum REC Quantity across 15 years using a degradation factor of half of one percent (0.5%) annually. If the Delivery Term extends beyond a 15-Delivery Year schedule starting with that first Delivery Year, then each subsequent Delivery Year Expected REC Quantity subsequent to the 15th Delivery Year shall reflect a quantity that provides for a degradation factor of half of one percent (0.5%) from the prior Delivery Year Expected REC Quantity (a sample delivery schedule Delivery Schedule is provided in Exhibit F).;
(d) Once annually on or prior to November 15 following a Delivery Year, the IPA or its designee shall review the performance of the REC deliveries made during such Delivery Year and determine the amount of Aggregate Drawdown Payment payment due as follows:
(i) For each Designated System that has been Energized and three (3) full Delivery Years has occurred since the start of the Delivery Term of such Designated SystemEnergized, the IPA or its designee shall calculate, with respect to a Delivery Year, a Delivery Year REC Performance for such Delivery Year (an example Delivery Year REC Performance calculation is provided in Exhibit G);
(ii) With respect to a Designated System that has been Energized and three (3) full Delivery Years has occurred since the start of the Delivery Term of such Designated System, in the event that the Delivery Year REC Performance is greater than the applicable Delivery Year Expected REC Quantity, the difference in the number amount of RECs REC quantities shall be the “Delivery Year Surplus Amount” and each REC included issued in the Delivery Year Surplus Amount excess shall be a “Surplus REC”. For avoidance of doubt, RECs that are issued later in the Delivery Year are to be considered first as Surplus RECs ahead of RECs issued earlier in the Delivery Year if the Delivery Year Surplus Amount exceeds the number of RECs that are of the latest vintage as recorded by PJM EIS GATS or M-RETS for such Delivery Year. Surplus RECs are tracked in the Surplus REC Account and shall remain in such account until a reduction in such Surplus RECs are recorded by the IPA or its designee to meet a Delivery Year Shortfall Amount;
(iii) With respect to a Designated System that has been Energized and three (3) full Delivery Years has occurred since the start of the Delivery Term of such Designated System, in the event that the Delivery Year REC Performance is less than the Delivery Year Expected REC Quantity, the difference in the number amount of RECs REC quantities shall be the “Delivery Year Shortfall Amount;”;
(iv) For After the third (3rd) Delivery Year fFor each Designated System System, if the total of any Delivery Year Surplus Amounts minus any that has a Delivery Year Shortfall Amounts for such Designated System is negative (the “Initial Shortfall Amount”), starting with the Designated System with the lowest Contract Price, additional Surplus RECs from the Surplus REC Account associated w/ the Designated System or group of systems of which the Designated System is a part shall be reduced and allocated to meet such Delivery Year Initial Shortfall Amount, REC for REC. If there are insufficient Surplus RECs to meet the Delivery Year Shortfall Amount, then the number of RECs calculated as the difference between the Delivery Year Shortfall Amount and the sum of such Surplus RECs being applied to meet the Delivery Year Shortfall Amount is the “Drawdown REC Quantity”, and the multiplicative product of the Drawdown REC Quantity and the Contract Price of such Designated System is the “Drawdown Payment”; and
(v) At the end of the foregoing process:
(1) Buyer shall draw on Seller’s Performance Assurance in the amount of the Aggregate Drawdown Payment. Seller shall be required to replenish Seller’s Performance Assurance in accordance with Section 4.3 of the Master REC Agreement. If Seller’s Performance Assurance is less than the Aggregate Drawdown Payment, then Seller shall pay Buyer the difference within fifteen
(15) Business Days of notice by Buyer. Failure by Seller to pay Buyer shall be an Event of Default subject to the Termination remedies under this REC Contract Notwithstanding the foregoing, if this is not the last Delivery Year under this REC Contract and the amount of the Aggregate Drawdown Payment is less than $5,000, then Buyer shall not draw on Seller’s Performance Assurance, but will track such amount and add such amount to the Aggregate Drawdown Payment for the subsequent Delivery Year or Delivery Years until the earlier of: the last Delivery Year or such time when the Aggregate Drawdown Payment is at least $5,000;
(2) For purposes of calculating the Delivery Year REC Performance in future Delivery Years, each Designated System that has a Delivery Year Shortfall Amount for which such Delivery Year Shortfall Amount is covered by Surplus REC(s) and/or for which a payment from Seller or from Seller’s Performance Assurance has been applied to the Drawdown REC Quantity, such Designated System is deemed to have Delivered REC quantities equal to the Delivery Year Expected REC Quantity in such Delivery Year.
(e) If a Designated System is a Community Renewable Energy Generation Project, such Designated System must maintain at least the Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed as provided in the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet throughout the remainder of the Delivery Term after the issuance of such Community Solar Quarterly Report. Failure to maintain the Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed as provided in the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet in a Delivery Year shall result in payment to Buyer from Seller of a monetary amount, determined by the IPA or its designee, and Buyer may draw on Seller’s Performance Assurance for this purpose. For each Delivery Year after the issuance of the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet, the subscription percentage and Community Solar Subscription Mix will each be calculated as a daily average, then averaged over the Delivery Year, based on actual subscription start and end dates entered in the REC Annual Report. The draw on Seller’s Performance Assurance will be calculated as the difference between (a) the contracted payment for that Delivery Year and (b) the amount that would have been paid given the realized Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed, if (a) exceeds (b). This amount will be calculated in arrears for only the immediately preceding Delivery Year covered by the REC Annual Report. If the Designated System regains a Community Solar Subscription mix and subscription percentage at or above their contracted amount in subsequent years, a drawdown will not occur in those years; however, overperformance in a Delivery Year will not be banked or applied to past Delivery Years. Designated Systems with subscription levels above 90% of Actual Nameplate Capacity on a kW capacity basis for a Delivery Year will not be subject to a draw on Seller’s Performance Assurance for that Delivery Year on the basis of subscription percentage. This calculation will only occur after the final Contract Price and quantity of RECs due payment are determined per section 5(e)(iv)(D) of the Cover Sheet and will be based on that final Contract Price and quantity which is determined by the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet.
(f) During the Delivery Term, Seller may determine that a Designated System is not performing at the level expected. In such case, Seller may submit a request to Buyer and the IPA (or its designee) to have the Delivery obligations of such Designated System reduced, and if the request is accepted by Buyer, such request shall be in exchange for the return by Seller to Buyer of an agreed upon payment adjustment if payment has been made by Buyer for RECs from such Designated System. Such request shall include pertinent information related to the payment adjustment as well as requested changes to future Delivery Year Expected REC Quantity and Contract Nameplate Capacity. Any such request shall be deemed approved upon Buyer’s receipt of such agreed upon payment adjustment, and information regarding the receipt of and the calculation of the agreed upon payment adjustment shall be communicated to the IPA and its designee. Any such changes in the delivery schedule and adjustments made to future Delivery Year Expected REC Quantity and Contract Nameplate Capacity shall be documented in an amended Schedule B to the Product Order applicable to such Designated System issued by the IPA or its designee to Buyer and Seller.
(g) Surplus RECs are virtually tracked in the Surplus REC Account and shall remain, except as provided in Section 9.2 of the Master REC Agreement, in such account until a reduction in such Surplus RECs is recorded by the IPA or its designee to meet a Delivery Year Shortfall Amount.
(h) Upon the conclusion of the annual review process pursuant to Section 6(d) above for the last Delivery Year under this REC Contract, if (i) there are Surplus RECs remaining in the Surplus REC Account and (ii) an Aggregate Drawdown Payment has occurred during the Term of this REC Contract, then the IPA or its designee shall calculate a monetary refund adjustment due to Seller from Buyer. Buyer shall credit Seller for each Surplus REC that can be applied to a REC associated with a Drawdown Payment. For purpose of calculating the refund, Surplus RECs from the Surplus REC Account shall be reduced and applied to the RECs that are associated with a Drawdown Payment, starting with the REC with the lowest Contract Price, REC for REC. The monetary refund adjustment shall be paid from Buyer to Seller by December 31 following the conclusion of the last annual review process. For avoidance of doubt, no payment shall be made for any Surplus RECs that remain in the Surplus REC Account after the refund adjustment is calculated.,
Appears in 1 contract
Sources: Renewable Energy Credit Agreement
Deliveries and Quantity. (a) For each Designated System that has been Energized, the Delivery of at least one (1) REC from such Designated System is expected to occur to the Buyer’s PJM-EIS GATS account or M-RETS account, as applicable, within 90 calendar days of when such Designated System was Energized if the Actual Contract Nameplate Capacity of such Designated System is greater than 5kW or within 180 calendar days of when the Designated System was Energized if the Actual Contract Nameplate Capacity of such Designated System is equal to or less than 5kW. For each Designated System that fails to Deliver at least (1) one REC from such Designated System by the applicable deadlineSystem, Seller must provide to Buyer and the IPA or its designee, with respect to such Designated System, a written notice within sixty thirty (30sixty (60) days [Commenter 3 Note: Many initial delivery delays are caused by communication errors with system owners and initial system set up errors. 30 days is insufficient time to properly investigate these errors and notify the Buyer] of the applicable deadline to Deliver at least one (1) REC confirming that there are no technical issues, with respect to such Designated System, known to Seller that would impede the generation, issuance and Delivery of RECs from such Designated System or that such technical issues have has been resolved by Seller. In the event that Seller fails to provide such written notice within sixty (60) days of the applicable deadline to Deliver at least one (1) REC, then the number of RECs associated with such Designated System shall be deemed removed from this REC Contract and Buyer shall be entitled to payment by Seller in the amount of the greater of: (i) the Collateral Requirement for such Designated System or (ii) one hundred percent (100%) of the total payments Seller has received from Buyer associated with RECs from such Designated System.;
(b) For each Designated System that has been Energized, all RECs designated to be Delivered pursuant to the Standing Order associated with such Designated System shall be Delivered to Buyer commencing from the date such Standing Order is established through the end of the Delivery Term of such Designated System regardless of whether the total payment made by Buyer to Seller for RECs from such Designated System is commensurate with the actual number of RECs Delivered from such Designated System.;
(c) For each Designated System that has been Energized, a REC delivery schedule is provided in Schedule B to the associated Product Order applicable to such Designated System that contains the expected number of RECs to be Delivered through the end of the Delivery Term where the number of RECs expected to be Delivered in each Delivery Year is based on the Designated System applicable Capacity Factor, Contract Maximum REC Quantity Nameplate Capacity and a degradation factor of half of one percent (0.5%) annuallyor custom degradation factor annually[Commenter 3 Note: Degradation factors are not uniform across all modules. .5% is a good middle ground but forcing all systems to use this could result in under deliveries.], and rounded down to the nearest whole REC REC. [Commenter 3 Note: Rounding should be done on total contract value and not on annual production. It looks like this method was used in each Delivery Year. Exhibit F, but I wanted to comment on make sure.] The REC quantities expected to be Delivered from such Designated System in a Delivery Year shall be the “Delivery Year Expected REC Quantity” for such Delivery Year. For avoidance of doubt, with respect to a Designated System, the Delivery Year Expected REC Quantities in the delivery schedule are determined at the time of Energization and not when the Delivery Term starts. As such, for purposes of calculating the Delivery Year Expected REC Quantity for each Delivery Year, the Delivery Year in which the date of Energization occurred shall be the first Delivery Year for which a Delivery Year Expected REC Quantity is calculated and the Delivery Year Expected REC Quantity for such first Delivery Year shall reflect an annualized number based on allocating the Designated System Contract Maximum REC Quantity across 15 years using a degradation factor of half of one percent (0.5%) annually. If the Delivery Term extends beyond a 15-Delivery Year schedule starting with that first Delivery Year, then each subsequent Delivery Year Expected REC Quantity subsequent to the 15th Delivery Year shall reflect a quantity that provides for a degradation factor of half of one percent (0.5%) from the prior Delivery Year Expected REC Quantity (a sample delivery schedule Delivery Schedule is provided in Exhibit F).;
(d) Once annually on or prior to November 15 following a Delivery Year, the IPA or its designee shall review the performance of the REC deliveries made during such Delivery Year and determine the amount of Aggregate Drawdown Payment payment due as follows:follows:[Commenter 3 Note: A workshop to go through this contract that covers the nuances of collateral requirements and the impacts they have on AV’s and System owners would be extremely beneficial. Please see our written comments for more detail.]
(i) For each Designated System that has been Energized and three (3) full Delivery Years has occurred since the start of the Delivery Term of such Designated SystemEnergized, the IPA or its designee shall calculate, with respect to a Delivery Year, a Delivery Year REC Performance for such Delivery Year (an example Delivery Year REC Performance calculation is provided in Exhibit G);
(ii) With respect to a Designated System that has been Energized and three (3) full Delivery Years has occurred since the start of the Delivery Term of such Designated System, in the event that the Delivery Year REC Performance is greater than the applicable Delivery Year Expected REC Quantity, the difference in the number amount of RECs REC quantities shall be the “Delivery Year Surplus Amount” and each REC included issued in the Delivery Year Surplus Amount excess shall be a “Surplus REC”. For avoidance of doubt, RECs that are issued later in the Delivery Year are to be considered first as Surplus RECs ahead of RECs issued earlier in the Delivery Year if the Delivery Year Surplus Amount exceeds the number of RECs that are of the latest vintage as recorded by PJM EIS GATS or M-RETS for such Delivery Year. Surplus RECs are tracked in the Surplus REC Account and shall remain in such account until a reduction in such Surplus RECs are recorded by the IPA or its designee to meet a Delivery Year Shortfall Amount;
(iii) With respect to a Designated System that has been Energized and three (3) full Delivery Years has occurred since the start of the Delivery Term of such Designated System, in the event that the Delivery Year REC Performance is less than the Delivery Year Expected REC Quantity, the difference in the number amount of RECs REC quantities shall be the “Delivery Year Shortfall Amount;”;
(iv) For ForStarting three years after energization for each Designated System that has a Delivery Year Shortfall Amount, starting with the Designated System with the lowest lowestclosest Contract Price, Surplus [Commenter 3 Note: Assigning surplus RECS to the lowest contract price creates and unmitigable risk for AV’s that service multiple system sizes. A very low solar production year or two successive low solar production years would result in under performance across all systems in the portfolio. This method of assigning surplus RECS covers the lowest value contracts first and could result in a substantially higher collateral drawdown than if surplus RECS were assigned back to the systems that generated them. See our comments in Exhibit G for more detail.]Surplus RECs from the Surplus REC Account shall be reduced and allocated to meet such Delivery Year Shortfall Amount, REC for REC. If there IfIf a Designated system drops below 90% of its contracted output and [Commenter 3 Note: There are no system level REC contracts that require 100% of a generation target to be achieved. Systems will endeavor to project output as close as possible to actual system production, but variation will occur. The remedies for this are the same used in the SPV and DG procurements. Either all RECS from a system must be delivered (this is already the case in this contract) or at least x% of the target production must be hit. The three-year rolling average does help somewhat to minimize the penalty that will be paid by system owners and developers, but it does not eliminate it even for fully functional systems. We request that one of the remedies from the DG or SPV contracts are used in this contract as well.]there are insufficient Surplus RECs to meet the Delivery Year Shortfall Amount, then the number amount of RECs REC quantity calculated as the difference between the Delivery Year Shortfall Amount and the sum of such Surplus RECs being applied to meet the Delivery Year Shortfall Amount is the “Drawdown REC Quantity”, and the multiplicative product of the Drawdown REC Quantity and the Contract Price of such Designated System is the “Drawdown Payment”; and
(v) At the end of the foregoing process:
(1) Buyer shall draw on Seller’s Performance Assurance in the amount of the Aggregate Drawdown Payment. Seller shall be required to replenish Seller’s Performance Assurance in accordance with Section 4.3 of the Master REC Agreementas provided herein. If Seller’s Performance Assurance is less than the Aggregate Drawdown Payment, then Seller shall pay Buyer the difference within fifteen
ten (1510) Business Days of notice by Buyer. Failure by Seller to pay Buyer shall be an Event of Default subject to the Termination remedies under this REC Contract Notwithstanding the foregoing, if this is not the last Delivery Year under this REC Contract and the amount of the Aggregate Drawdown Payment is less than $5,000, then Buyer shall not draw on Seller’s Performance Assurance, but will track such amount and add such amount to the Aggregate Drawdown Payment for the subsequent Delivery Year or Delivery Years until the earlier of: the last Delivery Year or such time when the Aggregate Drawdown Payment is at least $5,000;Contract; and
(2) For purposes of calculating the Delivery Year REC Performance in the future Delivery Yearsyears, each Designated System that has a Delivery Year Shortfall Amount for which such Delivery Year Shortfall Amount is covered by Surplus REC(s) RECs and/or for which a payment from Seller or from Seller’s Performance Assurance has been applied to the Drawdown REC Quantity, such Designated System is deemed to have Delivered REC quantities equal to the Delivery Year Expected REC Quantity in such Delivery Year.
(e) If a Designated System is a Community Renewable Energy Generation Project, such Designated System must maintain at least the Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed as provided in the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet throughout the remainder of the Delivery Term after the issuance of such Community Solar Quarterly Report. Failure to maintain the Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed as provided in the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet [Commenter 3 Note: This collateral calculation method essentially results in a Delivery Year shall fine paid by Approved Vendors for less sunny years. Even if a portfolio or system hits its 15 year delivery requirements, low solar production years will result in payment to Buyer from Seller of a monetary amount, determined fines paid by the IPA or its designeeAV that are not recouped in any way, and Buyer may draw on Seller’s Performance Assurance for this purpose. For each Delivery Year after the issuance of the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet, the subscription percentage and Community Solar Subscription Mix will each be calculated as a daily average, then averaged over the Delivery Year, based on actual subscription start and end dates entered in the REC Annual Report. The draw on Seller’s Performance Assurance will be calculated as the difference between (a) the contracted payment for that Delivery Year and (b) the amount that would have been paid given the realized Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed, if (a) exceeds (b). This amount will be calculated in arrears for only the immediately preceding Delivery Year covered by the REC Annual Report. If the Designated System regains a Community Solar Subscription mix and subscription percentage at or above their contracted amount in subsequent years, a drawdown will not occur in those years; however, overperformance in a Delivery Year will not be banked or applied to past Delivery Years. Designated Systems with subscription levels above 90% of Actual Nameplate Capacity on a kW capacity basis for a Delivery Year will not be subject to a draw on Seller’s Performance Assurance for that Delivery Year on the basis of subscription percentage. This calculation will only occur after the final Contract Price and quantity of RECs due payment are determined per section 5(e)(iv)(D) of the Cover Sheet and will be based on that final Contract Price and quantity which is determined by the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet.
(f) During the Delivery Term, Seller may determine that a Designated System is not performing at the level expected. In such case, Seller may submit a request to Buyer and the IPA (or its designee) to have the Delivery obligations of such Designated System reduced, and even if the request full 15 year delivery quantity is accepted by Buyer, such request shall be in exchange achieved or exceeded. Please see our attached comments for the return by Seller to Buyer of an agreed upon payment adjustment if payment has been made by Buyer for RECs from such Designated System. Such request shall include pertinent information related to the payment adjustment as well as requested changes to future Delivery Year Expected REC Quantity and Contract Nameplate Capacity. Any such request shall be deemed approved upon Buyer’s receipt of such agreed upon payment adjustment, and information regarding the receipt of and the calculation of the agreed upon payment adjustment shall be communicated to the IPA and its designee. Any such changes in the delivery schedule and adjustments made to future Delivery Year Expected REC Quantity and Contract Nameplate Capacity shall be documented in an amended Schedule B to the Product Order applicable to such Designated System issued by the IPA or its designee to Buyer and Sellermore detail.
(g) Surplus RECs are virtually tracked in the Surplus REC Account and shall remain, except as provided in Section 9.2 of the Master REC Agreement, in such account until a reduction in such Surplus RECs is recorded by the IPA or its designee to meet a Delivery Year Shortfall Amount.
(h) Upon the conclusion of the annual review process pursuant to Section 6(d) above for the last Delivery Year under this REC Contract, if (i) there are Surplus RECs remaining in the Surplus REC Account and (ii) an Aggregate Drawdown Payment has occurred during the Term of this REC Contract, then the IPA or its designee shall calculate a monetary refund adjustment due to Seller from Buyer. Buyer shall credit Seller for each Surplus REC that can be applied to a REC associated with a Drawdown Payment. For purpose of calculating the refund, Surplus RECs from the Surplus REC Account shall be reduced and applied to the RECs that are associated with a Drawdown Payment, starting with the REC with the lowest Contract Price, REC for REC. The monetary refund adjustment shall be paid from Buyer to Seller by December 31 following the conclusion of the last annual review process. For avoidance of doubt, no payment shall be made for any Surplus RECs that remain in the Surplus REC Account after the refund adjustment is calculated.]
Appears in 1 contract
Sources: Renewable Energy Credit Agreement
Deliveries and Quantity. (a) For each Designated System that has been Energized, the Delivery of at least one (1) REC from such Designated System is expected to occur to the Buyer’s PJM-EIS GATS account or M-RETS account, as applicable, within 90 calendar ninety (90) days of when such Designated System was Energized if the Actual Nameplate Capacity of such Designated System is greater than 5kW or within 180 calendar one hundred eighty (180) days of when the Designated System was Energized if the Actual Nameplate Capacity of such Designated System is equal to or less than 5kW. For each Designated System that fails to Deliver at least (1) one REC from such Designated System by the applicable deadline, Seller must provide to Buyer and the IPA or its designeeIPA, with respect to such Designated System, a written notice within sixty (60) days of the applicable deadline to Deliver at least one one
(1) REC confirming that there are no technical issues, with respect to such Designated System, known to Seller that would impede the generation, issuance and Delivery of RECs from such Designated System or that such technical issues have been resolved by Seller. In the event that Seller fails to provide such written notice within sixty (60) days of the applicable deadline to Deliver at least one (1) REC, then the number of Designated System and the RECs associated with such Designated System shall be deemed removed from this REC Contract Contract. As soon as practicable after the occurrence of such failure by Seller, the IPA shall provide to Buyer and Seller a revised Schedule A, Schedule B, and Schedule C to the Product Order for such Designated System indicating the removal of such Designated System from the REC Contract. Upon the occurrence of such failure, Buyer shall be entitled to payment by Seller in the amount of the greater of: (i) the Collateral Requirement for such Designated System or (ii) one hundred percent (100%) of the total payments Seller has received from Buyer associated with RECs from such Designated System.
(b) For each Designated System that has been Energized, all RECs designated to be Delivered pursuant to the Standing Order associated with such Designated System shall be Delivered to Buyer commencing from the date such Standing Order is established through the end of the Delivery Term of such Designated System regardless of whether the total payment made by Buyer to Seller for RECs from such Designated System is commensurate with the actual number of RECs Delivered from such Designated System.
(c) For each Designated System that has been Energized, a REC delivery schedule is provided in Schedule B to the Product Order applicable to such Designated System that contains the expected number of RECs to be Delivered through the end of the Delivery Term where the number of RECs expected to be Delivered in each Delivery Year is based on the Designated System Contract Maximum REC Quantity and a degradation factor of half of one percent (0.5%) annually, and rounded down to the nearest whole REC in each Delivery Year. The REC quantities expected to be Delivered from such Designated System in a Delivery Year shall be the “Delivery Year Expected REC Quantity” for such Delivery Year. For avoidance of doubt, with respect to a Designated System, the Delivery Year Expected REC Quantities in the delivery schedule are determined at the time of Energization and not when the Delivery Term starts. As such, for purposes of calculating the Delivery Year Expected REC Quantity for each Delivery Year, the Delivery Year in which the date of Energization occurred shall be the first Delivery Year for which a Delivery Year Expected REC Quantity is calculated and the Delivery Year Expected REC Quantity for such first Delivery Year shall reflect an annualized number based on allocating the Designated System Contract Maximum REC Quantity across 15 years using a degradation factor of half of one percent (0.5%) annually. If the Delivery Term extends beyond a 15-Delivery Year schedule starting with that first Delivery Year, then each subsequent Delivery Year Expected REC Quantity subsequent to the 15th Delivery Year shall reflect a quantity that provides for a degradation factor of half of one percent (0.5%) from the prior Delivery Year Expected REC Quantity (a sample delivery schedule is provided in Exhibit F).
(d) Once annually on or prior to November 15 following a Delivery Year, the IPA or its designee shall review the performance of the REC deliveries made during such Delivery Year Year, using information provided in the REC Annual Report submitted pursuant to Section 10(c) of the Cover Sheet, and determine the amount of Aggregate Drawdown Payment due as follows:
(i) For each Designated System that has been Energized and three (3) full Delivery Years has have occurred since the start of the Delivery Term of such Designated System, the IPA or its designee shall calculate, with respect to a Delivery Year, a Delivery Year REC Performance for such Delivery Year (an example Delivery Year REC Performance calculation is provided in Exhibit G);
(ii) With respect to a Designated System that has been Energized and three (3) full Delivery Years has have occurred since the start of the Delivery Term of such Designated System, in the event that the Delivery Year REC Performance is greater than the applicable Delivery Year Expected REC Quantity, the difference in the number of RECs shall be the “Delivery Year Surplus Amount” and each REC included in the Delivery Year Surplus Amount shall be a “Surplus REC”;
(iii) With respect to a Designated System that has been Energized and three (3) full Delivery Years has have occurred since the start of the Delivery Term of such Designated System, in the event that the Delivery Year REC Performance is less than the Delivery Year Expected REC Quantity, the difference in the number of RECs shall be the “Delivery Year Shortfall Amount”;
(iv) For each Designated System that has a Delivery Year Shortfall Amount, starting with the Designated System with the lowest Contract Price, Surplus RECs from the Surplus REC Account shall be reduced and allocated to meet such Delivery Year Shortfall Amount, REC for REC. If there are insufficient Surplus RECs to meet the Delivery Year Shortfall Amount, then the number of RECs calculated as the difference between the Delivery Year Shortfall Amount and the sum of such Surplus RECs being applied to meet the Delivery Year Shortfall Amount is the “Drawdown REC Quantity”, and the multiplicative product of the Drawdown REC Quantity and the Contract Price of such Designated System is the “Drawdown Payment”; and
(v) At the end of the foregoing process:
(1) Buyer shall inform Seller of the Aggregate Drawdown Payment (including any Drawdown Payment pursuant to Section 6(d)(iv) of the Cover Sheet and any Drawdown Payment pursuant to Section 6(e) of the Cover Sheet) by written notice and Seller may, within five (5) Business Days of such written notice, request for payment of the Aggregate Drawdown Payment to be made by additional cash transfer by Seller to Buyer or request for the payment of the Aggregate Drawdown Payment to be made from the cash or the Letter of Credit held as Seller’s Performance Assurance if both cash and a Letter of Credit are held as Seller’s Performance Assurance. If Buyer does not receive such request from Seller within such five (5) Business Day period, or if Seller makes a request within the five (5) Business Day period to pay with cash and then fails to remit the full cash payment by the fourteenth (14th) Business Day after Buyer’s written notice to Seller, Buyer shall draw on Seller’s Performance Assurance to reach the full amount of the Aggregate Drawdown Payment. If Buyer does receive such request from Seller for a draw on a particular form of Performance Assurance within such five (5) Business Day period, then Buyer shall draw on Seller’s Performance Assurance in the amount form requested. In all cases of a draw on Performance Assurance, the Aggregate Drawdown Paymentdraw shall be made on or after the fifteenth (15th) Business Day after Buyer’s written notice to Seller. Seller shall be required to replenish Seller’s Performance Assurance in accordance with Section 4.3 of the Master REC Agreement. If Seller’s Performance Assurance is less than the Aggregate Drawdown Payment, or if Seller has requested to make such payments by additional cash transfer, then Seller shall pay Buyer the difference or the amount of such payments, respectively, within fifteen
fifteen (15) Business Days of notice by Buyer. Failure by Seller to pay Buyer shall be an Event of Default subject to the Termination remedies under this REC Contract Contract. Notwithstanding the foregoing, if this is not the last Delivery Year under this REC Contract and the amount of the Aggregate Drawdown Payment is less than $5,000, then Buyer shall not draw on Seller’s Performance Assurance, but will track such amount and add such amount to the Aggregate Drawdown Payment for the subsequent Delivery Year or Delivery Years until the earlier of: the last Delivery Year or such time when the Aggregate Drawdown Payment is at least $5,000;
(2) For purposes of calculating the Delivery Year REC Performance in future Delivery Years, each Designated System that has a Delivery Year Shortfall Amount for which such Delivery Year Shortfall Amount is covered by Surplus REC(s) and/or for which a payment from Seller or from Seller’s Performance Assurance has been applied to the Drawdown REC Quantity, such Designated System is deemed to have Delivered REC quantities equal to the Delivery Year Expected REC Quantity in such Delivery Year.
(e) If a Designated System is a Community Renewable Energy Generation Project, such Designated System must maintain at least the Community Solar Subscription Mix Mix, the percent of Actual Nameplate Capacity that has been subscribed by the Anchor Tenant and the percent of Actual Nameplate Capacity that has been subscribed by End Use Customers as provided in the last Community Solar Quarterly First Year Report submitted pursuant to Section 10(b) of the Cover Sheet throughout the remainder of the Delivery Term after the issuance of such Community Solar Quarterly First Year Report. Failure to maintain the Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed by the Anchor Tenant and the percent of Actual Nameplate Capacity that has been subscribed by End Use Customers as provided in the last Community Solar Quarterly First Year Report submitted pursuant to Section 10(b) of the Cover Sheet in a Delivery Year shall result in payment to Buyer from Seller of a monetary amount, determined by the IPA or its designeeIPA, and Buyer may draw on Seller’s Performance Assurance for this purpose. The Designated System must maintain the minimum Community Solar Subscription Mix required under the SFA for the REC price adder obtained in the Non-Anchor Tenant Contract Price that resulted from the Community Solar Subscription Mix indicated in the Community Solar First Year Report; the Designated System must also maintain the subscription shares of the Anchor Tenant and End Use Customers as indicated in the Community Solar First Year Report. For each Delivery Year after the issuance of the last Community Solar Quarterly First Year Report submitted pursuant to Section 10(b) of the Cover Sheet, then, using the subscription percentage REC Annual Report submitted under Section 10(c) of the Cover Sheet and at the same time as the calculations made under Section 6(d) of the Cover Sheet: the Community Solar Subscription Mix as well as the subscription share percentages of the Anchor Tenant and End Use Customers will each be calculated by the IPA as a daily average, then averaged over the Delivery Year, . This daily average will be based on actual subscription start and end dates comprised of the day that a subscription start or end request was submitted to the utility, as entered in the REC Annual Report. The draw on Seller’s Performance Assurance will be calculated as the sum of the following: (i) the difference between (a) the contracted payment for Community Solar Anchor Payment allocable to that Delivery Year and (b) the amount that would have been paid for the Anchor Tenant’s subscription share for that Delivery Year given the percent of Actual Nameplate Capacity that has been subscribed by Anchor Tenant in that Delivery Year, if (a) exceeds (b); and (ii) the difference between (x) the Community Solar Non-Anchor Payment allocable to that Delivery Year and (y) the amount that would have been paid for the End Use Customers’ subscription share for that Delivery Year given the realized Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribedsubscribed by End Use Customers in that Delivery Year, if (ax) exceeds (b). This amount will be calculated in arrears for only y).3 (Provided, that the immediately preceding Delivery Year covered by the REC Annual Report. If the Designated System regains a Community Solar Subscription mix and subscription percentage at or above their contracted amount in subsequent years, a drawdown will not occur in those years; however, overperformance in a Delivery Year will not be banked or applied to past Delivery Years. Designated Systems with subscription levels above 90% of Actual Nameplate Capacity on a kW capacity basis for a Delivery Year will not be subject to a draw on Seller’s Performance Assurance for will simply equal the total payment allocable to that Delivery Year on if the basis percent of subscription percentage. This calculation will only occur after Non-Anchor Nameplate Capacity that has been subscribed by End Use Customers in that Delivery Year is less than fifty percent (50%); but if this deficiency is due to the final Contract Price and quantity loss of RECs due payment are determined per section 5(e)(iv)(D) of an Anchor Tenant in the Cover Sheet and will be based on that final Contract Price and quantity which is Delivery Year, the Seller shall have a specified period determined by the last IPA from the end of the Delivery Year to cure the deficiency before such a draw is made. If the percent of Non-Anchor Nameplate Capacity that has been subscribed by End Use Customers is at least fifty percent (50%) at the end of such cure period, the draw on Seller’s Performance Assurance will be calculated as the sum of the following: (i) the difference between (a) the Community Solar Quarterly Report submitted Anchor Payment allocable to that Delivery Year and (b) the amount that would have been paid for the Anchor Tenant’s subscription 3 For avoidance of doubt, the calculations made in this Section 6(e) shall not take into account any adjustments made pursuant to Section 10(b5(f)(ii) or Section 5(f)(vi) of the Cover Sheet.
. For purposes of the calculating the (fa) During Community Solar Anchor Payment, (b) Community Solar Non-Anchor Payment, (c) the Delivery Term, Seller may determine amounts that a Designated System is not performing at would have been paid for the level expected. In such case, Seller may submit a request to Buyer and the IPA (or its designee) to have the Delivery obligations of such Designated System reducedAnchor Tenant’s subscription share, and if (d) the request is accepted by Buyer, such request shall be in exchange amounts that would have been paid for the return by Seller to Buyer of an agreed upon payment adjustment if payment has been made by Buyer for RECs from such Designated System. Such request shall include pertinent information related to the payment adjustment as well as requested changes to future Delivery Year Expected REC Quantity and Contract Nameplate Capacity. Any such request shall be deemed approved upon BuyerEnd Use Customer’s receipt of such agreed upon payment adjustment, and information regarding the receipt of and the calculation of the agreed upon payment adjustment shall be communicated to the IPA and its designee. Any such changes in the delivery schedule and adjustments made to future Delivery Year Expected REC Quantity and Contract Nameplate Capacity shall be documented in an amended Schedule B to the Product Order applicable to such Designated System issued by the IPA or its designee to Buyer and Seller.
(g) Surplus RECs are virtually tracked in the Surplus REC Account and shall remain, except as provided in Section 9.2 of the Master REC Agreement, in such account until a reduction in such Surplus RECs is recorded by the IPA or its designee to meet a Delivery Year Shortfall Amount.
(h) Upon the conclusion of the annual review process subscription share required pursuant to Section 6(d) above for this section 6(e), the last Delivery Year under this REC Contract, if (i) there are Surplus RECs remaining in the Surplus REC Account and (ii) an Aggregate Drawdown Payment has occurred during the Term of this REC Contract, then the IPA or its designee applicable Anchor Tenant Contract Price shall calculate a monetary refund adjustment due to Seller from Buyer. Buyer shall credit Seller for each Surplus REC that can be applied to a REC associated with a Drawdown Payment. For purpose the share of calculating the refundActual Nameplate Capacity being subscribed by the Anchor Tenant only, Surplus RECs from and the Surplus REC Account applicable Non- Anchor Tenant Contract Price shall be reduced and applied to the RECs that are associated with a Drawdown Payment, starting with the REC with the lowest Contract Price, REC for REC. The monetary refund adjustment shall be paid from Buyer to Seller by December 31 following the conclusion share of the last annual review process. For avoidance of doubt, no payment shall be made for any Surplus RECs that remain in the Surplus REC Account after the refund adjustment is calculatedActual Nameplate Capacity being subscribed by End Use Customers only.
Appears in 1 contract
Sources: Renewable Energy Credit Agreement
Deliveries and Quantity. 4.1 Initial Delivery Obligations. 11 Specifically, if payments have been made to Seller with respect to a Designated System, and the number of RECs Delivered from such Designated System is less than the Designated System Paid REC Quantity, then with respect to each such Designated System, Seller shall return a portion of the amount of payment equal to the multiplicative product of (A) the Contract Price and (B) the positive difference between (i) the Designated System Paid REC Quantity and (ii) the number of RECs that has been Delivered from such Designated System (not to exceed the Designated System Contract Maximum REC Quantity).
(a) For each Designated System that has been Energized, the Delivery of at least one (1) REC from such Designated System is expected to occur to the theto Buyer’s PJM-EIS GATS account or M-M- RETS account, as applicable, is expected to occur within 90 calendar ninety (90) days of when such Designated System was Energized if the Actual Nameplate Capacity of such Designated System is greater than 5kW or within 180 calendar one hundred eighty (180) days of when the Designated System was Energized if the Actual Nameplate Capacity of such Designated System is equal to or less than 5kW. Seller shall upload meter readings to PJM-EIS GATS or M-RETS pursuant to Section 2.3(e) as necessary for the issuance and timely Delivery of at least one (1) REC by the deadline set forth in this Section 4.1
(a) For each each.
(b) With respect to a Designated System System, in the event that Seller fails to Deliver at least one (1) REC by the deadline set forth in Section 4.1(a), then the following shall occur:
(i) Payments attributable to such Designated System shall be suspended upon the occurrence of such failure by Seller to the extent there are payments that are outstanding for such Designated System. Payments that are attributable to such Designated System, if any are outstanding, shall resume and be made in accordance with Section 5.1 and Section 5.2(1) one upon the Delivery of one (1) REC from such Designated System by the applicable deadline, Seller must provide to Buyer and the IPA or its designee, with respect to such Designated System, a written notice within sixty (60) days of the applicable deadline to Deliver at least one (1) REC confirming confirmingif such Delivery occurs prior to the upcoming REC Annual Report submission deadline of July 15.
(i) (ii) If the Delivery of one (1) REC has not occurred by the upcoming July 15 REC Annual Report submission deadline, Seller shall include in Seller’s REC Annual Report a confirmation that there are no technical issues, with respect to such Designated System, known to Seller that would impede the generation, issuance and Delivery of RECs from such Designated System or that such technical issues have been resolved by Seller. In the event that Seller fails to provide such written notice within sixty (60) days of the applicable deadline to Deliver at least one (1) REC, then the number of Designated System and the RECs associated with such Designated System shall be deemed removed from this REC Contract Contract. As soon as practicable after the occurrence of such failure by Seller, the IPA shall provide to Buyer and Seller a revised Schedule A, Schedule B, and Schedule C to the Product Order for such Designated System indicating the removal of such Designated System from the REC Contract. Upon the occurrence of such failure, Buyer shall be entitled to payment by Seller in the amount of the greater of: (i) the Collateral Requirement for such Designated System or (ii) one hundred percent (100%) of the total payments Seller has received from Buyer associated with RECs from such Designated System.
(b) For each Designated System that has been Energized, all RECs designated to be Delivered pursuant to the Standing Order associated with such Designated System shall be Delivered to Buyer commencing from the date such Standing Order is established through the end of the Delivery Term of such Designated System regardless of whether the total payment made by Buyer to Seller for RECs from such Designated System is commensurate with the actual number of RECs Delivered from such Designated System.
(c) For each Designated System that has been Energized, a REC delivery schedule is provided in Schedule B to the Product Order applicable to such Designated System that contains the expected number of RECs to be Delivered through the end of the Delivery Term where the number of RECs expected to be Delivered in each Delivery Year is based on the Designated System Contract Maximum REC Quantity . and a degradation factor of half of one percent (0.5%) annuallyconfirmation that ▇▇▇▇▇▇ has uploaded meter readings to PJM-EIS GATS or M-RETS, and rounded down to the nearest whole REC in each Delivery Year. The REC quantities expected to be Delivered from such Designated System in a Delivery Year shall be the “Delivery Year Expected REC Quantity” for such Delivery Year. For avoidance of doubt, with respect to a Designated System, the Delivery Year Expected REC Quantities in the delivery schedule are determined at the time of Energization and not when the Delivery Term starts. As such, for purposes of calculating the Delivery Year Expected REC Quantity for each Delivery Year, the Delivery Year in which the date of Energization occurred shall be the first Delivery Year for which a Delivery Year Expected REC Quantity is calculated and the Delivery Year Expected REC Quantity for such first Delivery Year shall reflect an annualized number based on allocating the Designated System Contract Maximum REC Quantity across 15 years using a degradation factor of half of one percent (0.5%) annually. If the Delivery Term extends beyond a 15-Delivery Year schedule starting with that first Delivery Year, then each subsequent Delivery Year Expected REC Quantity subsequent to the 15th Delivery Year shall reflect a quantity that provides for a degradation factor of half of one percent (0.5%) from the prior Delivery Year Expected REC Quantity (a sample delivery schedule is provided in Exhibit F).
(d) Once annually on or prior to November 15 following a Delivery Year, the IPA or its designee shall review the performance of the REC deliveries made during such Delivery Year and determine the amount of Aggregate Drawdown Payment due as follows:
(i) For each Designated System that has been Energized and three (3) full Delivery Years has occurred since the start of the Delivery Term of such Designated System, the IPA or its designee shall calculate, with respect to a Delivery Year, a Delivery Year REC Performance for such Delivery Year (an example Delivery Year REC Performance calculation is provided in Exhibit G);
(ii) With respect to a Designated System that has been Energized and three (3) full Delivery Years has occurred since the start of the Delivery Term of such Designated System, in the event that the Delivery Year REC Performance is greater than the applicable Delivery Year Expected REC Quantity, the difference in the number of RECs shall be the “Delivery Year Surplus Amount” and each REC included in the Delivery Year Surplus Amount shall be a “Surplus REC”;
(iii) With respect to a Designated System that has been Energized and three (3) full Delivery Years has occurred since the start of the Delivery Term of such Designated System, in the event that the Delivery Year REC Performance is less than the Delivery Year Expected REC Quantity, the difference in the number of RECs shall be the “Delivery Year Shortfall Amount”;
(iv) For each Designated System that has a Delivery Year Shortfall Amount, starting with the Designated System with the lowest Contract Price, Surplus RECs from the Surplus REC Account shall be reduced and allocated to meet such Delivery Year Shortfall Amount, REC for REC. If there are insufficient Surplus RECs to meet the Delivery Year Shortfall Amount, then the number of RECs calculated as the difference between the Delivery Year Shortfall Amount and the sum of such Surplus RECs being applied to meet the Delivery Year Shortfall Amount is the “Drawdown REC Quantity”, and the multiplicative product of the Drawdown REC Quantity and the Contract Price of such Designated System is the “Drawdown Payment”; and
(v) At the end of the foregoing process:
(1) Buyer shall draw on Seller’s Performance Assurance in the amount of the Aggregate Drawdown Payment. Seller shall be required to replenish Seller’s Performance Assurance in accordance with Section 4.3 of the Master REC Agreement. If Seller’s Performance Assurance is less than the Aggregate Drawdown Payment, then Seller shall pay Buyer the difference within fifteen
(15) Business Days of notice by Buyer. Failure by Seller to pay Buyer shall be an Event of Default subject to the Termination remedies under this REC Contract Notwithstanding the foregoing, if this is not the last Delivery Year under this REC Contract and the amount of the Aggregate Drawdown Payment is less than $5,000, then Buyer shall not draw on Seller’s Performance Assurance, but will track such amount and add such amount to the Aggregate Drawdown Payment for the subsequent Delivery Year or Delivery Years until the earlier of: the last Delivery Year or such time when the Aggregate Drawdown Payment is at least $5,000;
(2) For purposes of calculating the Delivery Year REC Performance in future Delivery Years, each Designated System that has a Delivery Year Shortfall Amount for which such Delivery Year Shortfall Amount is covered by Surplus REC(s) and/or for which a payment from Seller or from Seller’s Performance Assurance has been applied to the Drawdown REC Quantity, such Designated System is deemed to have Delivered REC quantities equal to the Delivery Year Expected REC Quantity in such Delivery Year.
(e) If a Designated System is a Community Renewable Energy Generation Project, such Designated System must maintain at least the Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed as provided in the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet throughout the remainder of the Delivery Term after the issuance of such Community Solar Quarterly Report. Failure to maintain the Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed as provided in the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet in a Delivery Year shall result in payment to Buyer from Seller of a monetary amount, determined by the IPA or its designee, and Buyer may draw on Seller’s Performance Assurance for this purpose. For each Delivery Year after the issuance of the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet, the subscription percentage and Community Solar Subscription Mix will each be calculated as a daily average, then averaged over the Delivery Year, based on actual subscription start and end dates entered in the REC Annual Report. The draw on Seller’s Performance Assurance will be calculated as the difference between (a) the contracted payment for that Delivery Year and (b) the amount that would have been paid given the realized Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed, if (a) exceeds (b). This amount will be calculated in arrears for only the immediately preceding Delivery Year covered by the REC Annual Report. If the Designated System regains a Community Solar Subscription mix and subscription percentage at or above their contracted amount in subsequent years, a drawdown will not occur in those years; however, overperformance in a Delivery Year will not be banked or applied to past Delivery Years. Designated Systems with subscription levels above 90% of Actual Nameplate Capacity on a kW capacity basis for a Delivery Year will not be subject to a draw on Seller’s Performance Assurance for that Delivery Year on the basis of subscription percentage. This calculation will only occur after the final Contract Price and quantity of RECs due payment are determined per section 5(e)(iv)(D) of the Cover Sheet and will be based on that final Contract Price and quantity which is determined by the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet.
(f) During the Delivery Term, Seller may determine that a Designated System is not performing at the level expected. In such case, Seller may submit a request to Buyer and the IPA (or its designee) to have the Delivery obligations of such Designated System reduced, and if the request is accepted by Buyer, such request shall be in exchange for the return by Seller to Buyer of an agreed upon payment adjustment if payment has been made by Buyer for RECs from such Designated System. Such request shall include pertinent provide information related to the payment adjustment as well as requested changes to future Delivery Year Expected REC Quantity and Contract Nameplate Capacity. Any such request shall be deemed approved upon Buyer’s receipt of such agreed upon payment adjustment, and information regarding the receipt of and the calculation of the agreed upon payment adjustment shall be communicated to the IPA and its designee. Any such changes in the delivery schedule and adjustments made to future Delivery Year Expected REC Quantity and Contract Nameplate Capacity shall be documented in an amended Schedule B to the Product Order applicable to such Designated System issued by the IPA or its designee to Buyer and Selleruploads.
(g) Surplus RECs are virtually tracked in the Surplus REC Account and shall remain, except as provided in Section 9.2 of the Master REC Agreement, in such account until a reduction in such Surplus RECs is recorded by the IPA or its designee to meet a Delivery Year Shortfall Amount.
(h) Upon the conclusion of the annual review process pursuant to Section 6(d) above for the last Delivery Year under this REC Contract, if (i) there are Surplus RECs remaining in the Surplus REC Account and (ii) an Aggregate Drawdown Payment has occurred during the Term of this REC Contract, then the IPA or its designee shall calculate a monetary refund adjustment due to Seller from Buyer. Buyer shall credit Seller for each Surplus REC that can be applied to a REC associated with a Drawdown Payment. For purpose of calculating the refund, Surplus RECs from the Surplus REC Account shall be reduced and applied to the RECs that are associated with a Drawdown Payment, starting with the REC with the lowest Contract Price, REC for REC. The monetary refund adjustment shall be paid from Buyer to Seller by December 31 following the conclusion of the last annual review process. For avoidance of doubt, no payment shall be made for any Surplus RECs that remain in the Surplus REC Account after the refund adjustment is calculated.
Appears in 1 contract
Sources: Master Renewable Energy Certificate Credit Purchase and Sale Agreement
Deliveries and Quantity. (a) For each Designated System that has been Energized, the Delivery of at least one (1) REC from such Designated System is expected to occur to the Buyer’s PJM-EIS GATS account or M-RETS account, as applicable, within 90 calendar days of when such Designated System was Energized if the Actual Nameplate Capacity of such Designated System is greater than 5kW or within 180 calendar days of when the Designated System was Energized if the Actual Nameplate Capacity of such Designated System is equal to or less than 5kW. For each Designated System that fails to Deliver at least (1) one REC from such Designated System by the applicable deadline, Seller must provide to Buyer and the IPA or its designee, with respect to such Designated System, a written notice within sixty (60) days of the applicable deadline to Deliver at least one (1) REC confirming that there are no technical issues, with respect to such Designated System, known to Seller that would impede the generation, issuance and Delivery of RECs from such Designated System or that such technical issues have been resolved by Seller. In the event that Seller fails to provide such written notice within sixty (60) days of the applicable deadline to Deliver at least one (1) REC, then the number of RECs associated with such Designated System shall be deemed removed from this REC Contract and Buyer shall be entitled to payment by Seller in the amount of the greater of: (i) the Collateral Requirement for such Designated System or (ii) one hundred percent (100%) of the total payments Seller has received from Buyer associated with RECs from such Designated System.
(b) For each Designated System that has been Energized, all RECs designated to be Delivered pursuant to the Standing Order associated with such Designated System shall be Delivered to Buyer commencing from the date such Standing Order is established through the end of the Delivery Term of such Designated System regardless of whether the total payment made by Buyer to Seller for RECs from such Designated System is commensurate with the actual number of RECs Delivered from such Designated System.
(c) For each Designated System that has been Energized, a REC delivery schedule is provided in Schedule B to the Product Order applicable to such Designated System that contains the expected number of RECs to be Delivered through the end of the Delivery Term where the number of RECs expected to be Delivered in each Delivery Year is based on the Designated System Contract Maximum REC Quantity and a degradation factor of half of one percent (0.5%) annually, and rounded down to the nearest whole REC in each Delivery Year. The REC quantities expected to be Delivered from such Designated System in a Delivery Year shall be the “Delivery Year Expected REC Quantity” for such Delivery Year. For avoidance of doubt, with respect to a Designated System, the Delivery Year Expected REC Quantities in the delivery schedule are determined at the time of Energization and not when the Delivery Term starts. As such, for purposes of calculating the Delivery Year Expected REC Quantity for each Delivery Year, the Delivery Year in which the date of Energization occurred shall be the first Delivery Year for which a Delivery Year Expected REC Quantity is calculated and the Delivery Year Expected REC Quantity for such first Delivery Year shall reflect an annualized number based on allocating the Designated System Contract Maximum REC Quantity across 15 years using a degradation factor of half of one percent (0.5%) annually. If the Delivery Term extends beyond a 15-Delivery Year schedule starting with that first Delivery Year, then each subsequent Delivery Year Expected REC Quantity subsequent to the 15th Delivery Year shall reflect a quantity that provides for a degradation factor of half of one percent (0.5%) from the prior Delivery Year Expected REC Quantity (a sample delivery schedule is provided in Exhibit F).
(d) Once annually on or prior to November 15 following a Delivery Year, the IPA or its designee shall review the performance of the REC deliveries made during such Delivery Year and determine the amount of Aggregate Drawdown Payment due as follows:
(i) For each Designated System that has been Energized and three (3) full Delivery Years has occurred since the start of the Delivery Term of such Designated System, the IPA or its designee shall calculate, with respect to a Delivery Year, a Delivery Year REC Performance for such Delivery Year (an example Delivery Year REC Performance calculation is provided in Exhibit G);
(ii) With respect to a Designated System that has been Energized and three (3) full Delivery Years has occurred since the start of the Delivery Term of such Designated System, in the event that the Delivery Year REC Performance is greater than the applicable Delivery Year Expected REC Quantity, the difference in the number of RECs shall be the “Delivery Year Surplus Amount” and each REC included in the Delivery Year Surplus Amount shall be a “Surplus REC”;
(iii) With respect to a Designated System that has been Energized and three (3) full Delivery Years has occurred since the start of the Delivery Term of such Designated System, in the event that the Delivery Year REC Performance is less than the Delivery Year Expected REC Quantity, the difference in the number of RECs shall be the “Delivery Year Shortfall Amount”;
(iv) For each Designated System that has a Delivery Year Shortfall Amount, starting with the Designated System with the lowest Contract Price, Surplus RECs from the Surplus REC Account shall be reduced and allocated to meet such Delivery Year Shortfall Amount, REC for REC. If there are insufficient Surplus RECs to meet the Delivery Year Shortfall Amount, then the number of RECs calculated as the difference between the Delivery Year Shortfall Amount and the sum of such Surplus RECs being applied to meet the Delivery Year Shortfall Amount is the “Drawdown REC Quantity”, and the multiplicative product of the Drawdown REC Quantity and the Contract Price of such Designated System is the “Drawdown Payment”; and
(v) At the end of the foregoing process:
(1) Buyer shall draw on Seller’s Performance Assurance in the amount of the Aggregate Drawdown Payment. Seller shall be required to replenish Seller’s Performance Assurance in accordance with Section 4.3 of the Master REC Agreement. If Seller’s Performance Assurance is less than the Aggregate Drawdown Payment, then Seller shall pay Buyer the difference within fifteen
fifteen (15) Business Days of notice by Buyer. Failure by Seller to pay Buyer shall be an Event of Default subject to the Termination remedies under this REC Contract Notwithstanding the foregoing, if this is not the last Delivery Year under this REC Contract and the amount of the Aggregate Drawdown Payment is less than $5,000, then Buyer shall not draw on Seller’s Performance Assurance, but will track such amount and add such amount to the Aggregate Drawdown Payment for the subsequent Delivery Year or Delivery Years until the earlier of: the last Delivery Year or such time when the Aggregate Drawdown Payment is at least $5,000;
(2) For purposes of calculating the Delivery Year REC Performance in future Delivery Years, each Designated System that has a Delivery Year Shortfall Amount for which such Delivery Year Shortfall Amount is covered by Surplus REC(s) and/or for which a payment from Seller or from Seller’s Performance Assurance has been applied to the Drawdown REC Quantity, such Designated System is deemed to have Delivered REC quantities equal to the Delivery Year Expected REC Quantity in such Delivery Year.
(e) If a Designated System is a Community Renewable Energy Generation Project, such Designated System must maintain at least the Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed as provided in the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet throughout the remainder of the Delivery Term after the issuance of such Community Solar Quarterly Report. Failure to maintain the Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed as provided in the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet in a Delivery Year shall result in payment to Buyer from Seller of a monetary amount, determined by the IPA or its designee, and Buyer may draw on Seller’s Performance Assurance for this purpose. For each Delivery Year after the issuance of the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet, the subscription percentage and Community Solar Subscription Mix will each be calculated as a daily average, then averaged over the Delivery Year, based on actual subscription start and end dates entered in the REC Annual Report. The draw on Seller’s Performance Assurance will be calculated as the difference between (a) the contracted payment for that Delivery Year and (b) the amount that would have been paid given the realized Community Solar Subscription Mix and the percent of Actual Nameplate Capacity that has been subscribed, if (a) exceeds (b). This amount will be calculated in arrears for only the immediately preceding Delivery Year covered by the REC Annual Report. If the Designated System regains a Community Solar Subscription mix and subscription percentage at or above their contracted amount in subsequent years, a drawdown will not occur in those years; however, overperformance in a Delivery Year will not be banked or applied to past Delivery Years. Designated Systems with subscription levels above 90% of Actual Nameplate Capacity on a kW capacity basis for a Delivery Year will not be subject to a draw on Seller’s Performance Assurance for that Delivery Year on the basis of subscription percentage. This calculation will only occur after the final Contract Price and quantity of RECs due payment are determined per section 5(e)(iv)(D) of the Cover Sheet and will be based on that final Contract Price and quantity which is determined by the last Community Solar Quarterly Report submitted pursuant to Section 10(b) of the Cover Sheet.
(f) During the Delivery Term, Seller may determine that a Designated System is not performing at the level expected. In such case, Seller may submit a request to Buyer and the IPA (or its designee) to have the Delivery obligations of such Designated System reduced, and if the request is accepted by Buyer, such request shall be in exchange for the return by Seller to Buyer of an agreed upon payment adjustment if payment has been made by Buyer for RECs from such Designated System. Such request shall include pertinent information related to the payment adjustment as well as requested changes to future Delivery Year Expected REC Quantity and Contract Nameplate Capacity. Any such request shall be deemed approved upon Buyer’s receipt of such agreed upon payment adjustment, and information regarding the receipt of and the calculation of the agreed upon payment adjustment shall be communicated to the IPA and its designee. Any such changes in the delivery schedule and adjustments made to future Delivery Year Expected REC Quantity and Contract Nameplate Capacity shall be documented in an amended Schedule B to the Product Order applicable to such Designated System issued by the IPA or its designee to Buyer and Seller.
(g) Surplus RECs are virtually tracked in the Surplus REC Account and shall remain, except as provided in Section 9.2 of the Master REC Agreement, in such account until a reduction in such Surplus RECs is recorded by the IPA or its designee to meet a Delivery Year Shortfall Amount.
(h) Upon the conclusion of the annual review process pursuant to Section 6(d) above for the last Delivery Year under this REC Contract, if (i) there are Surplus RECs remaining in the Surplus REC Account and (ii) an Aggregate Drawdown Payment has occurred during the Term of this REC Contract, then the IPA or its designee shall calculate a monetary refund adjustment due to Seller from Buyer. Buyer shall credit Seller for each Surplus REC that can be applied to a REC associated with a Drawdown Payment. For purpose of calculating the refund, Surplus RECs from the Surplus REC Account shall be reduced and applied to the RECs that are associated with a Drawdown Payment, starting with the REC with the lowest Contract Price, REC for REC. The monetary refund adjustment shall be paid from Buyer to Seller by December 31 following the conclusion of the last annual review process. For avoidance of doubt, no payment shall be made for any Surplus RECs that remain in the Surplus REC Account after the refund adjustment is calculated.
Appears in 1 contract
Sources: Renewable Energy Credit Agreement