Specified Source
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EXHIBIT C-SS SPECIFIED SOURCE CONFIRMATION ATTACHMENT1
This “Specified Source Confirmation Attachment” applies to the Confirmation to which this is attached and made a part by and between [ ] (“Purchaser”) and [ ] (“Seller”) dated as of [ ]. In the event of any inconsistency between this Specified Source Confirmation Attachment and the WSPP Agreement or any master confirmation agreement between the Parties, this Specified Source Confirmation Attachment will control. References herein to “Sections” means Sections of this Specified Source Confirmation Attachment, unless stated to be Sections of the WSPP Agreement.
1. Specified Source. a. Identity of Source: The following (i) facility, generator, unit or (ii) ACS system (“Source”):
Source CARB IDs, if applicable and available:
California Energy Commission RPS ID, if Source is an ERR:
WREGIS ID#, if applicable: b. Source EFsp: c. Carbon Adjustment (rapid settlement if Seller delivers higher emissions factor energy than agreed): Carbon Adjustment applies unless the following box is checked: Carbon Adjustment does not apply and instead of Carbon Adjustment, Seller shall compensate Purchaser as follows, in addition to Purchaser’s remedies in Section 21 of the WSPP Agreement, if Seller fails to schedule and deliver energy from the Source unless excused pursuant to the terms of the applicable Schedule or this Confirmation: [e.g., fixed damages of $0, $2, or % of Carbon Adjustment.] d. EF True-Up (full indemnity for difference between agreed and CARB-assigned emissions factors, settled after verification): EF True-Up does not apply unless one or more of the following boxes that are checked cause a change to EFsp or EFasn:
1 This is a completely optional document that may be used as additional terms for a Confirmation for the sale and purchase of ANY WSPP Service Schedule or energy product. Users would attach a completed Exhibit C-SS to the form of Confirmation that is Exhibit C of the WSPP Agreement, or to any other form of Confirmation used by the Parties. It is not a “Schedule” or “Schedule S”; rather, it adds further completely optional lines for Parties to describe their transaction, such as those in Exhibit C where Parties, e.g., select the Service Schedule. The Cap-and- Trade Regulations are subject to change, and such changes may have a material impact on the operation of this document. Exhibit C-SS may be periodically reviewed and revised after publication in response to such changes or other market developments and comments received. However, the foregoing is not a warranty that further revisions will be made, and the WSPP does not offer legal advice. Accordingly, all WSPP members and other users of this document are urged to consult with their own legal counsel to ensure that their use of this document achieves their commercial objectives and protects their legal interests in light of the then-current state of the Cap-and-Trade Regulations. 1 Change in generator operations or fuel source. Prospective or retroactive change in law (including AB32). Other, as follows: All other circumstances. EF True Up damages are limited as follows: [e.g., caps] e. RECs Disclosure (not applicable for an ACS system Source): Seller represents and warrants that the Source is not an ERR, unless the box is checked below. This is a disclosure, not an option, and failure to check this box does not excuse performance if the Source is or becomes an ERR. The Source is an ERR, and Section 6.c therefore applies. f. Regulation Incorporation: This transaction is not Regulation Incorporation unless the following box is checked: This transaction is Regulation Incorporation and Section 6.e applies. g. Additional provisions:
2. Definitions. Initially capitalized terms used and not otherwise defined herein are defined in the Cap and Trade Regulations or the WSPP Agreement, as applicable.
a. “AB32” means the California Global Warming Solutions Act of 2006 and the Cap and Trade Regulations.
b. “ ACS” means “asset-controlling supplier” as that term is defined in the Cap and Trade Regulations.
c. “ Cap and Trade Regulations” means the Mandatory Greenhouse Gas Emissions Reporting and California Cap on Greenhouse Gas Emissions and Market-Based Compliance Mechanisms regulations (California Code of Regulations Title 17, Subchapter 10, Articles 2 and 5 respectively) promulgated by CARB pursuant to the California Global Warming Solutions Act of 2006.
d. “ CARB” means the California Air Resources Board of the California Environmental Protection Agency.
e. “Carbon Adjustment” means the mechanism of Sections 7.a and 7.b.
f. “EFasn” means the final emission factor assigned by CARB for the energy delivered pursuant to this Confirmation.
g. “EFsp” means the Source emissions factor specified in Section 1.b.
2 h. “ EFunsp” means the default emissions factor for unspecified electricity imports within the meaning of the Cap and Trade Regulations as of the date of the calculation of the applicable Carbon Adjustment.
i. “EF True-Up” means the mechanism of Section 7.c.
j. “ ERR” means an eligible renewable resource under the California renewable portfolio standard, as defined in California Public Utilities Code §399.12(e).
k. “ GHGavg” is the average California ISO published Greenhouse Gas Allowance Index Price for the next succeeding fifteen trading days from and including the date of the event or notice that gives rise to need to calculate GHGavg.
l. “ REC” means a certificate of proof associated with the generation of electricity from an ERR, issued through WREGIS.
m. “Regulation Incorporation” means Section 6.e applies.
n. “SEQ” means the quantity of Substitute Energy.
o. “Specified Source” means a facility, generator or unit, or ACS system, to be claimed as the source of electricity.
p. “Specified Source Transaction” means an agreement between a seller and a buyer to transact electricity that both parties thereto agree is an agreement to deliver energy from a Specified Source.
q. “Substitute Energy” includes “substitute power” or “substitute electricity” as defined in the Cap and Trade Regulations and any other replacement energy that is not from the Source and that Seller delivered or that was otherwise acquired by Purchaser at the Delivery Point due to Seller’s failure to deliver electricity from the Source, including substitute energy within the meaning of the definition of Replacement Price in the WSPP Agreement.
r. “TL” means the transmission loss correction factor of 1.02.
s. “ WREGIS” means the Western Renewable Generation Information System.
t. Rules of Interpretation. Unless otherwise required by the context in which any term appears, (i) the singular includes the plural and vice versa; (ii) all references to a
3 particular entity include a reference to such entity’s successors and permitted assigns; and (iii) the word “or” is not necessarily exclusive.
3. Specified Source Transaction. This is a transaction for the purchase and sale of generation from the Source as a Specified Source. Seller agrees to provide the electric energy purchased and sold hereunder from the Source. Seller shall provide Purchaser, within a reasonable time after request, (a) proof of the veracity of the representations made by Seller in Section 4, and (b) unless the Source is an ACS system, Source meter data or its equivalent. Purchaser may disclose, to any potential purchasers of the energy purchased and sold hereunder, (i) that it has entered into this Specified Source Transaction with Seller, but any such disclosure shall redact price terms to the extent permitted by applicable law or regulation and (ii) all Source meter data or equivalent, or allocated generation information, provided to it by Seller. Purchaser may transfer all rights of disclosure granted herein to any Purchaser of any part of the energy purchased and sold hereunder.
4. Representations. Seller warrants and represents: (a) EFsp is the most recent Source’s emissions factor assigned by CARB as reported by CARB as of the date hereof; provided however, that if an emissions factor has not been assigned by CARB, EFsp is estimated by Seller in good faith; (b) it is one of: (i) the ACS, (ii) the owner or operator of the Source with prevailing rights to sell the electricity sold hereunder, or (iii) is selling or remarketing electricity procured pursuant to a Specified Source Transaction from the Source through the market path and possesses or has the right to obtain copies of Documentary Writing or authorized 2 Electronic Writing that the energy it is reselling or remarketing was procured pursuant to Specified Source Transactions from the Source through the market path.
5. Service Schedules Unchanged. Nothing in this Specified Source Confirmation Attachment limits the obligation of either Party to deliver or receive energy as provided in the Confirmation. Cancellation, termination, suspension, cessation or other inapplicability of AB32, in general or to electricity imported into California, shall not entitle either Party to cancel or rescind this transaction.
6. Further Covenants.
a. Nothing in this Confirmation limits the rights or obligations of either Party under Section 9.6 of the WSPP Agreement. b. Notwithstanding and without limiting Section 21.3(c) of the WSPP Agreement, Seller is under no obligation to attribute or include a value on account of EFsp in determining Resale Price.
2 Any WSPP member seeking to require that Specified Source Transactions be pursuant to Documentary Writing onl y, and may not be entered into by an Electronic Writing, may do so by placing its name on the List of Parties Requiri ng Documentary Writing for Specified Source Transactions, which list the WSPP will maintain on its website. Any WSPP Member contemplating relying on an Electronic Writing is advised to check such list to ensure that its counte rparty or upstream counterparty is not on said list. 4 c. If the Source is or becomes an ERR, and RECs are created for the electricity purchased and sold hereunder, Seller shall within 30 days of availability on WREGIS notify Purchaser of the WREGIS serial numbers for any RECs not purchased and sold to Purchaser. If Seller fails to do so, Seller shall pay Purchaser’s direct actual damages, as reasonably determined by Purchaser, subject to limitations of damages as set forth in Section 1.c but, irrespective of the selection in Section 1.c, no more than the Carbon Adjustment would have been (or the EF True-Up if EF True-Up has been elected by the Parties) with respect to such energy. Neither Party is agreeing to register the Source or maintain registration of the Source with the California Energy Commission as an ERR.
d. Seller, upon the reasonable request of the Purchaser, will deliver additional documents and information, to the extent such information is in the Seller’s possession or available to Seller.
e. If the Parties have elected Regulation Incorporation, (a) Seller warrants that this is a “power contract” for “specified source electricity” as those or then-comparable terms are defined in AB32, as amended from time to time, and (b) Seller agrees to provide proof of this transaction as a “power contract” for “specified source electricity”, or then-comparable terms, in accordance with AB32, as amended from time to time, from the date hereof through the date of Purchaser’s verification for the year of energy delivery.
7. Carbon Adjustment and EF True-Up.
a. If Carbon Adjustment applies, without limiting Purchaser’s remedies for Seller’s failure to deliver pursuant to Section 21 of the WSPP Agreement: Seller shall pay Purchaser pursuant to Section 9 of the WSPP Agreement as follows for either (i) failure to deliver any part of the energy to Purchaser from the Source unless excused pursuant to the terms of the applicable Schedule or this Confirmation, or (ii) failure to timely provide the records and data described in Section 3, or perform under Section 6.c if applicable or Section 6.e if applicable, even if delivery was from the Source, if Purchaser reasonably anticipates that such failure will prevent Purchaser from being able to claim the Source’s EFsp:
i. If the Delivery Point is the Source busbar or the Source is an ACS system for which deliveries are reported as measured at a first point of receipt located within the balancing authority area of that ACS:
SEQ * ((TL * EFunsp) - EFsp) * GHGavg
ii. If the Delivery Point is not the Source busbar or the Source is an ACS system for which deliveries are not reported as measured at a first point of receipt located within the balancing authority area of the ACS:
SEQ * TL * (EFunsp- EFsp) * GHGavg
; provided, however, that if Purchaser bought substitute or replacement energy from the CAISO, the Carbon Adjustment is $0.00 and no damages in excess of the amounts due pursuant to
5 Section 21 of the WSPP Agreement will be owed by Seller. Purchaser’s purchase transactions for replacement or substitute energy are “records” within the meaning of Section 9.6 of the WSPP Agreement.
b. If Carbon Adjustment applies, “economic benefit” and “economic loss” as those terms are used in Section 22.3(g)(i) and 22.3(g)(ii), respectively, of the WSPP Agreement will include a Carbon Adjustment calculated as if the Terminated Transaction will be replaced with one for Substitute Energy with EFunsp.
c. If EF True-Up applies and EFasn is greater than EFsp, then Seller shall pay Purchaser within 30 days following CARB’s publication of EFasn:
i. If the Delivery Point is the Source busbar or the Source is an ACS system for which deliveries are reported as measured at a first point of receipt located within the balancing authority area of that ACS:
(Contract Quantity – SEQ) * (EFasn – EFsp) * GHGavg
ii. If the Delivery Point is not the Source busbar or the Source is an ACS system for which deliveries are not reported as measured at a first point of receipt located within the balancing authority area of the ACS:
(Contract Quantity – SEQ) * TL * (EFasn – EFsp) * GHGavg
8. Choice of Law. Notwithstanding Section 24 of the WSPP Agreement, AB32 shall be construed and interpreted in accordance with the laws of the State of California; provided, however, if the Seller or Purchaser is an agency of or part of the United States Government, then the laws of the United States of America shall govern. Nothing herein is a consent to the jurisdiction of FERC, CARB or any other state or federal government, department or agency by a Party for this transaction if that Party and this transaction is not otherwise subject to such jurisdiction.
9. The Confirmation and this Specified Source Confirmation Attachment may be executed in counterparts, each of which taken together shall constitute one and the same instrument.
______Purchaser Seller
______Authorized Signature for Purchaser Authorized Signature for Seller
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