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Long-Term Renewable Energy and RECs RFP (169) New
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Long-Term Renewable Energy and RECs RFP

The Sample Supplier Fee Confirmation is available on our Web site as the last item under the Long-Term Master Agreement dated September 7, 2010.  Like the Confirmation, it does not need to be signed and returned prior to bid submittals.  If the ICC approves the Bidder’s Bids for a Project, by the end of the first business day after the ICC decision approving the results, the Procurement Administrator will send an unexecuted electronic copy of the Supplier Fee Confirmation to the Bidder.  The Officer of the Bidder will then execute the Supplier Fee Confirmation by 12 PM (noon) CPT (1 PM Eastern Prevailing Time) and send the executed Supply Fee Confirmation to the Procurement Administrator by the business day following the day of receipt of the unexecuted electronic copy of the Supplier Fee Confirmation. The Supplier Fee will be due to the Illinois Power Agency (“IPA”) sixty (60) days after the ICC decision.

The Procurement Administrator announced on October 13, 2010 that the RFP would resume under the schedule posted to the Calendar of the RFP Web site.

The schedule and location for these workshops are expected to be as follows:

Tuesday, October 26th
Gleacher Center - Room 100
450 North Cityfront Plaza Drive
Chicago, Illinois 60611
10AM IPA Long-Term RFP Workshop: Review of ComEd contract issues There will also be a 2PM workshop to review of Ameren contract issues.

Monday, November 1st
Michael A. Bilandic Building
160 North LaSalle Street - Room C500
Chicago, Illinois
2PM IPA Long-Term RFP Workshop: Review of Interim ComEd draft There will also be a 10AM to review the Interim Ameren Draft.

Thursday, November 4th
Michael A. Bilandic Building
160 North LaSalle Street – Room C500
Chicago, Illinois
10AM IPA Long-Term RFP Workshop: Review of Final ComEd Draft There will also be a 2PM to review the Final Ameren Draft.

Please see our announcement for registration information.

The Procurement Administrator announced on October 13, 2010 that the RFP would resume under the schedule posted to the Calendar of the RFP Web site.

The Procurement Administrator also announced on October 13, 2010 that three workshops are scheduled. The first workshop will take place on October 26, 2010 to review written comments received on the contract and to compile a list of issues raised. Draft amendments will be circulated for review at a second workshop that will take place on Monday, November 1, 2010. A final draft of the contract will be issued for discussion at a third workshop that will take place on Thursday, November 4, 2010.  The detailed times and venues are announced here.

Yes.  Bidders may submit a Part 1 Proposal for a Project that had not previously qualified.  The documents required for qualification will be posted on November 8, 2010.  The deadline for submission of the Part 1 Proposal (the qualification materials) is November 16, 2010.

The Procurement Administrator will endeavor to minimize the burden on Bidders by not asking for materials to be resubmitted.  However, please be advised that changes to the Long-Term Master Agreement may result in changes to the requirements for qualification of a Project under the Long-Term RFP.  Also, please be advised that, to the extent that previously submitted materials were deficient, such deficiencies will need to be cured under the deadlines of the revised schedule.

More specifically, Bidders that submitted their materials for the Part 1 Proposal to qualify a Project for the Long-Term RFP under the previous schedule will not be required to resubmit these materials.  To continue in the process, these returning Bidders will be asked to confirm that the information provided remains accurate or to update information as needed.  If revisions to the Long-Term Master Agreement lead to revisions in the qualification requirements, such returning Bidders will have to submit to these new qualification requirements for the Project.  

The Procurement Administrator will consider all materials submitted under the previous schedule for the Part 2 Proposal for a given Project.  A Bidder will not be required to resubmit any materials that are compliant with the requirements.  The Procurement Administrator will re-issue any request for the Bidder to complete the materials submitted for the Part 2 Proposal for a given Project if such materials were deficient as of September 28, 2010.  A Bidder that chose to have its Pre-Bid Letter of Credit cancelled or a Bidder whose Pre-Bid Letter of Credit expired or was unacceptable to ComEd will be required to re-issue the Pre-Bid Letter of Credit with an expiration date of December 22, 2010.

The Pre-Bid Letter of Credit will be due with the Part 2 Proposal on December 2, 2010.  The new expiration date will be December 22, 2010.

The amount of the Pre-Bid Letter of Credit should reflect the Annual Contract Quantity in the Part 1 Form. The Part 2 Form does not provide you with an opportunity to change the Annual Contract Quantity; rather, it provides you with a worksheet for your convenience only in which you may input the Annual Contract Quantity submitted in the Part 1 Form for purposes of calculating the amount required for the Pre-Bid Letter of Credit.

Yes. Each Project will have a different Confirmation under the Long-Term Master Agreement and a different price.

No.

There are two different letters of credit. The Pre-Bid Letter of Credit is provided with the Part 2 Proposal due September 24, 2010 and the earliest expiration date is October 14, 2010. The amount is $0.50 times 3 times the Annual Contract Quantity. The Pre-Bid Letter of Credit is returned to bidders at the end of the RFP process (the precise timing is explained in the RFP Rules). Collateral is due upon execution of the Long-Term Master Agreement, and you may use the Post-Bid Letter of Credit to post this collateral. The amount of collateral due is $5 times 3 times the Annual Quantity. The two letters of credit not only have different amounts but are completely different in their provisions and conditions for drawing.

Yes. The Procurement Administrator will release that Bidder’s Pre-Bid Letter of Credit within one (1) business day of the ICC decision.

In the case you describe, the bidder will be able to specify its Applicable Percentage at contract execution.

Please see Paragraph 14 of the Pre-Bid Letter of Credit. A Foreign bank is acceptable as long as the bank can make the representation in that Paragraph, namely that the Pre-Bid Letter of Credit is issued from a U.S. branch office and that as of the date of issuance of this Letter of Credit, the senior unsecured long-term debt of the bank is rated "A–" or better by Standard & Poor's, "A3" or better by Moody's Investors Service, and, if rated by Fitch Ratings, "A–" or better by Fitch Ratings.

Your deduction is incorrect. You are correct that the energy can be sold separately to PJM and that you will receive energy compensation outside of the Long-Term Master Agreement. However, you do not appear to be considering the fact that the settlement with ComEd will be based on the DIFFERENCE between the fixed price (bid price with the escalation factor) and the floating price (the hourly day-ahead price at the ComEd zone, Pnode 33092371). If your bid price only reflects the REC value, you will be paid (or pay) under the Long-Term Master Agreement the REC value you bid less the hourly day-ahead price.

The Long-Term Master Agreement applies to the hourly output of the facility times the Applicable Percentage. For example, a bidder wishing to sell half the output of a unit may declare 50% as the Applicable Percentage. The bidder, if its Bids are selected and approved by the Commission, would then settle for 50% of the output in each hour and have a settlement and payment profile that follows the annual generation pattern. The 50% in each hour would count toward meeting the delivery obligations. The bidder may designate an Applicable Percentage other than 50%. Let's assume that the bidder specifies 100%. In that case, 100% of hourly generation would count toward the delivery obligation. The Annual Contract Quantity could then be met early in the Delivery Year, for example in December. The bidder (unless electing the 10% advance delivery option) would not be eligible to be paid again under the Long-Term Master Agreement until the start of the next Delivery Year (starting June 1). Hence, the Applicable Percentage makes a significant difference.

The RRB is based on the forecasted sales of eligible retail customers at the customer meter.

The solar target is to procure at least 6% of solar photovoltaic resources. Please note, however, that the evaluation of Bids and the selection of renewable energy resources first give priority to cost effectiveness, second to resource type, and last to location. Thus, it is possible that even if a sufficient number of bids from solar photovoltaic resources are received, that the bids recommended to the Commission would include a percentage of solar photovoltaic resources that is less than, equal to, or greater than, 6% of the total quantity of Bids recommended.

Yes.

We can only answer this question from the perspective of a generator selling to ComEd under the Long-Term Master Agreement. We note that a facility selling its output to Ameren under the Ameren QF rider can participate in the Long-Term RFP for ComEd. While it is a matter of terminology, we will not refer to your arrangement as “behind the meter”. That term implies that you displace delivery services and energy purchased from ComEd (or Ameren) and/or energy purchased from a RES by using your on-site generation to serve all or part of the on-site energy demand. Such a facility is not eligible for the Long-Term RFP. We believe that your arrangement is that you have metered and sell to ComEd (or Ameren) all of the on-site net generation output and then that you buy all the electricity used on-site under ComEd (or Ameren) tariffs or from a RES. Metering and selling the entire net output of the on-site generation, while buying all electricity requirements (often referred to as buy all/sell all), constitutes delivery to a utility distribution system and qualifies you to participate in the Long-Term RFP. The utility could be a utility other than ComEd or Ameren as well. Should your Bids be selected and approved by the Commission in the Long-Term RFP, your arrangements for sales to ComEd, Ameren or another utility you may sell to, will not change as a result. You will produce, be metered, deliver to ComEd, Ameren or another utility, and be paid for energy as you do all these things today. What will change with respect to payment is that after delivering the RECs associated with your generation, you will also be paid (or pay ComEd if negative), for generation in each hour the fixed price in the contract less the day ahead LMP at the ComEd zone. (The ComEd zone settlement node for the Long-Term Master Agreement is PJM Pnode 33092371.) The settlement under the Long-Term Master Agreement with ComEd is at this Pnode without regard to where you deliver the energy or what utility you deliver the energy to. Essentially, the sale of energy from the facility to the utility and the Long-Term Master Agreement are separate arrangements.

The business name on the W-9 should be the name of the entity that will sign the Long-Term Master Agreement.

These documents are required for full execution of the Long-Term Master Agreement. They are referred to in Part 3 of the Schedule to the Long-Term Master Agreement. ComEd has made available samples for these documents, which are posted here: http://www.comed-energyrfp.com/ltdocuments.asp

Please see Paragraph V.3.4 of the RFP Rules. If the ICC does not approve any of the Bidder’s Bids, the Procurement Administrator will release that Bidder’s Pre-Bid Letter of Credit within one (1) business day of the ICC decision.

The applicable percentage should refer to the output of the entire facility as measured by a revenue grade interconnection meter.

The Budget for this procurement event was calculated as 30% of the estimated Renewable Resource Budget ("RRB") for the 2012-13 Delivery Year (June 1, 2012 to May 31, 2013), namely: (0.30) x $2.158216481/MWh x 35,319,525 MWh = (0.30) x ($76,227,182) = $22,868,155. The calculation of the Budget for this procurement event refers to an *estimated* 2012-13 RRB because the forecasted sales for a Delivery Year are determined in the prior Delivery Year. The forecasted sales may be revised and a definite 2012-13 RRB will be calculated in 2011. In the past, the RRB has been part of the Procurement Plan filed each year by the IPA and approved by the Commission. As you note, for 2012-13, the percentage contribution of the long-term purchases is approximately 50% of the requirement to meet the Renewable Portfolio Standard. However, the requirement increases over the duration of the Long-Term Agreement so that the percentage contribution of the long-term purchases could well fall over time. For illustrative purposes only, if the sales in 2025-2026 were the same as the sales for 2012-13, the percentage contribution of the Long-Term purchases would be in the order of 16% of the requirement by 2025. Thus, one would not necessarily expect the proportion of the RRB for the Long-Term RFP to be equal to the percentage contribution of the long-term purchases to the 2012-13 requirement.

Please refer to Paragraphs 6 of the Credit Support Annex, as may be amended my Paragraph 13 of the Credit Support Annex, regarding Buyer's eligibility to hold the Posted Collateral. Generally, any Posted Collateral may be drawn down if an Event of Default with respect to the Seller has occurred and is continuing or an Early Termination Date has occurred or been designated as a result of an Event of Default. Please refer to Paragraphs 7 and 8 for more information regarding this. Please note that the Schedule to the Master Agreement provides that the Early Termination Amount will be payable to the Non-defaulting Party by the Defaulting Party. Please also note that the Confirmation to the Master Agreement provides that if Seller fails to deliver the requisite amount of Replacement RECs within 90 days of the end of the Delivery Year in which the RECs were to have been delivered is an Event of Default. In such case, the Confirmation to the Master Agreement provides that "in addition to the rights and remedies provided in Paragraphs 6 and 8 of the Credit Support Annex and without further notice to the Seller or without any need to designate an Early Termination Date, Buyer shall have the right to liquidate any Posted Collateral supporting the RECs and use the proceeds to procure the Replacement RECs."

The Budget for this procurement event was calculated as 30% of the estimated Renewable Resource Budget ("RRB") for the 2012-13 Delivery Year (June 1, 2012 to May 31, 2013). If the forecasted sales did not change, and if the entire Budget was spent, the imputed REC cost would constitute 30% of the 2012-13 RRB.

If your Bids are selected and approved by the Commission, the following payments or security will be required: a) By 1PM eastern (12PM central) on the third business day after the Commission decision, you must post collateral equal to $5 for each MWh of three times the Annual Contract Quantity. This is what you call the "Performance Assurance on RECs" in #2 above and is probably what you meant by the collateral to be posted shortly after announcement of winning bids in #4 above. You may use cash or a letter of credit. If using a letter of credit, you must use the form provided as Schedule 1 to the Credit Support Annex or incorporate only those modifications that were found acceptable upon review of the Part 1 Proposals. Schedule 1 to the Credit Support Annex is the "Post-Bid Letter of Credit" in #1 above. b) The Energy Exposure Calculation is explained in detail in Schedule 2 of the Credit Support Annex. ComEd will make these calculations each business and would call for margin as necessary. Margin would be required if the around-the-clock energy value exceeds the contract value under the Long-Term Master Agreement. This is what you call "Performance Assurance on Energy" in #3 above. Margin may be provided in cash (within one business day of a demand by ComEd) or through a letter of credit (within two business days of a demand by ComEd). If using a letter of credit, you must use the form provided as Schedule 1 to the Credit Support Annex or only incorporate those modifications that were found acceptable upon review of the Part 1 Proposal. Schedule 1 to the Credit Support Annex is the "Post-Bid Letter of Credit" in #1 above. c) Supplier Fee is estimated at $0.61/MWh for each MWh of the Annual Contract Quantity. The Supplier Fee is due by check to the IPA within sixty (60) of the Commission decision on the results of the procurement event. You identify this as #5 above.

Although the beneficiary of the Pre-Bid Letter of Credit is ComEd, please do not send the Pre-Bid Letter of Credit to ComEd. The Pre-Bid Letter of Credit MUST BE SENT TO THE PROCUREMENT ADMINISTRATOR at the following address: NERA – Procurement Administrator 2010 ComEd Long-Term RFP 875 North Michigan Ave, Suite 3650, Chicago IL 60611 The Procurement Administrator holds the Pre-Bid Letter of Credit on behalf of ComEd, as stated in the Pre-Bid Letter of Credit itself. You may provide a draft copy of the Pre-Bid Letter of Credit to us for review. However, please be aware that we will only review the draft copy as time permits. We will prioritize the review of executed letters of credit and Part 2 Proposal materials that are submitted by other bidders. Further, please note that our review will be preliminary and non-binding: only our review of your executed Pre-Bid Letter of Credit would be relevant to the assessment of whether or not you have completed the requirements of the Part 2 Proposal.

The overall Renewable Resource Budget (“RRB”) is an amount that is applicable to ComEd’s purchases of renewable resources in a Delivery Year (whether or not through this Long-Term RFP). The RRB in a given Delivery Year is for purchases that will occur in that Delivery Year. Although the Long-Term RFP is held in 2010, purchases under the Long-Term Master Agreements will begin only on June 1, 2012 and thus the relevant RRBs will be those of each Delivery Year under the contract, starting in 2012-13.

The Renewable Resource Budget (“RRB”)is calculated in accordance with the Act. The RRB is set for any given Delivery Year (June 1 of a given year until May 31 of the following year) as an amount per MWh (“MWh-Amount”) times the forecasted sales of eligible retail customers at the customer meter for that Delivery Year. For 2012-2013, the MWh-Amount in the IPA's draft 2011 procurement plan is $2.158. The forecasted sales are determined for each Delivery Year as of the previous Delivery Year.

The calculation of the Budget for this procurement event used an *estimated* RRB for the 2012-13 Delivery Year. The forecasted sales for a Delivery Year are determined in the prior Delivery Year. The forecasted sales for 2012-13 will be available in 2011 and the RRB for 2012-13 will be definitively calculated at that time. In the past, the RRB has been part of the Procurement Plan filed each year by the IPA and approved by the Commission.

The Budget for this procurement event was calculated as 30% of the estimated Renewable Resource Budget (“RRB”) for the 2012-13 Delivery Year (June 1, 2012 to May 31, 2013). The evaluation of Bids will ensure that the imputed REC component for expenditures under Long-Term Master Agreements entered into pursuant to this procurement event will not exceed $22,868,155 in the first Delivery Year of the Long-Term Master Agreement.

The evaluation for this procurement event will be consistent with the interpretation of the Act provided in the Order from the Illinois Commerce Commission from December 19, 2007, which first gives priority to cost effectiveness, second to resource type, and last to location. You may review the Order here: http://www.icc.illinois.gov/docket/files.aspx?no=07-0528&docId=117871&m=0

If the Budget is met first, the evaluation continues with the steps as specified in the evaluation process. The word 'may' in this sentence: "The selection process may continue in a manner similar to the steps specified in (b), (c) and (d) above, although in this case, when the process ends, the Target is not met. For simplification purposes this is not shown", refers to the fact that it may or may not be possible to make any replacements for resource type or location if the Budget is met first.

The date of posting of each document on the RFP web site is indicated in the name of the file.

Section 1-75 is the portion of the Act relevant to this procurement event. HB6202 does not amend the locational priority in that Section of the Act, which continues to state: “After June 1, 2011, cost-effective renewable energy resources located in Illinois and in states that adjoin Illinois may be counted towards compliance with the standards set forth in paragraph (1) of this subsection (c). If those cost-effective resources are not available in Illinois or in states that adjoin Illinois, they shall be purchased elsewhere and shall be counted towards compliance.”

The evaluation for this procurement event will be consistent with the interpretation of the Act provided in the Order from the Illinois Commerce Commission from December 19, 2007, which first gives priority to cost effectiveness, second to resource type, and last to location. You may review the Order here: http://www.icc.illinois.gov/docket/files.aspx?no=07-0528&docId=117871&m=0

The RRB for a Delivery Year is calculated in accordance with Section 1-75(c) of the Act. The RRB is a limit on the amount that may be spent in a given Delivery Year on renewable resources in accordance with the Illinois Power Agency Act (“Act”). The RRB applies to all purchases of renewable resources in a given Delivery Year. The RRB in a Delivery Year is calculated as a MWh-Amount times the forecasted sales for that Delivery Year as of the prior Delivery Year. In the Procurement Plan recently filed by the IPA and currently being considered by the Commission, the MWh-Amount is $2.158/MWh. (The MWh-Amount is calculated as the greater of: (i) 2.015% of the amount paid by eligible retail customers during the year ending May 31, 2007, which is 2.015% of $93.88/MWh; and (ii) the incremental amount that could be paid by eligible retail customers in 2011 compared to 2010, which is $2.158). The calculation of the Budget for this procurement event refers to an *estimated* RRB for the 2012-13 Delivery Year because the forecasted sales for a Delivery Year are determined in the prior Delivery Year so that the RRB for 2012-13 will be definitively calculated in 2011. In the past, the RRB has been part of the Procurement Plan filed each year by the IPA and approved by the Commission.

The Budget for this procurement event was calculated as 30% of the estimated Renewable Resource Budget (“RRB”) for the 2012-13 Delivery Year (June 1, 2012 to May 31, 2013). The Budget for this long-term procurement was based on an estimate of the long-term renewable resources required in future years, given the renewable resource budgets in those future years and the forward price curve of the renewable resources being procured. Thus a Budget for this procurement event of the full RRB would not be consistent with the Act. Further, the IPA, subject to ICC approval, will determine how to address the remainder of the renewable portfolio standard in future procurement plans. Please see Appendix K approved by the Commission for further details: http://www.comed-energyrfp.com/ltdocuments.asp

The evaluation of Bids in this RFP will ensure that the imputed REC component for expenditures under Long-Term Master Agreements entered into pursuant to this procurement event will not exceed $22,868,155 in the first Delivery Year of the Long-Term Master Agreement (where a Delivery Year starts on June 1 of the year and ends on May 31 of the following year). We refer to the figure of $22,868,155 as the “Budget”. We refer to the overall Renewable Resource Budget applicable to ComEd’s purchases of renewable resources in a Delivery Year (whether or not through this Long-Term RFP) as the “RRB”.

The calculation of the RRB is set forth in Section 1-75(c) of the Act, which states:

“the total of renewable energy resources procured pursuant to the procurement plan for any single year shall be reduced by an amount necessary to limit the annual estimated average net increase due to the costs of these resources included in the amounts paid by eligible retail customers in connection with electric service to:

[…]

(D) in 2011, the greater of an additional 0.5% of the amount paid per kilowatthour by those customers during the year ending May 31, 2010 or 2% of the amount paid per kilowatthour by those customers during the year ending May 31, 2007; and

(E) thereafter, the amount of renewable energy resources procured pursuant to the procurement plan for any single year shall be reduced by an amount necessary to limit the estimated average net increase due to the cost of these resources included in the amounts paid by eligible retail customers in connection with electric service to no more than the greater of 2.015% of the amount paid per kilowatthour by those customers during the year ending May 31, 2007 or the incremental amount per kilowatthour paid for these resources in 2011.”

The RRB is set for any given Delivery Year as an amount per MWh (“MWh-Amount”) times the forecasted sales of eligible retail customers at the customer meter for that Delivery Year. For 2011-2012, the MWh-Amount is calculated as the greater of (i) 2.0% of the price paid by eligible retail customers for 2006-07 (2% of $93.88); or (ii) the MWh-Amount calculated for purposes of setting the 2010-11 RRB plus an additional 0.5% of the price paid in 2010-11 by eligible retail customers ($1.598 plus 0.5% of $112.01). This MWh-Amount, as filed by the IPA in the 2011 draft procurement plan, is $2.158. For 2012-2013 and every Delivery Year thereafter, the MWh-Amount is calculated as the greater of (i) 2.015% of the price paid by eligible retail customers for 2006-07 (2.015% of $93.88, which is $1.892); and (ii) the MWh-Amount that was calculated for purposes of setting the 2011-12 RRB, filed as $2.158, which is $2.158.

Please note that this does not create a fixed RRB over the term of the Long-Term Master Agreement; rather, it creates a fixed MWh-Amount in each Delivery Year of the Long-Term Master Agreement subject to a caveat in the last paragraph of this response. To calculate the RRB for a given Delivery Year, the MWh-Amount will be multiplied by the sales of eligible retail customers at the customer meter, forecasted as of the prior Delivery Year. The RRB will vary to the extent that sales to eligible retail customers vary, either because the load of these customers vary (for example because of customer migration) or because the price paid by these customers vary (for example because of changes in energy prices). Each Bidder may make their own assumptions regarding how the RRB may vary in the future.

It is possible that these provisions of the Act could be amended in the future. In particular, the Act states that: “No later than June 30, 2011, the Commission shall review the limitation on the amount of renewable energy resources procured pursuant to this subsection (c) and report to the General Assembly its findings as to whether that limitation unduly constrains the procurement of cost-effective renewable energy resources.” The Commission has not yet reported to the General Assembly in this regard.

The evaluation of Bids will ensure that the imputed REC component for expenditures under Long-Term Master Agreements entered into pursuant to this procurement event will not exceed $22,868,155 in the first Delivery Year of the Long-Term Master Agreement.

Over the course of the Long-Term Agreement, there is no separate budget for the Long-Term contracts that grows at 2% per year. Rather, there is an overall Renewable Resource Budget (“RRB”), which is an amount calculated each year in accordance with the Act, and which applies to all purchases of renewable resources (purchases from this Long-Term RFP and any other purchases necessary to meet the Renewable Portfolio Standard of the Act). The RRB is set for any given Delivery Year (June 1 of a given year until May 31 of the following year) as an amount per MWh (“MWh-Amount”) times the forecasted sales of eligible retail customers at the customer meter for that Delivery Year.

For 2012-2013 and every Delivery Year thereafter, the MWh-Amount that has been filed by the IPA is $2.158. The forecasted sales will be determined for each Delivery Year as of the previous Delivery Year. In each Delivery Year of the Long-Term Master Agreement there will be a cost imputed to the Long-Term contracts that will be counted toward the RRB of that Delivery Year. Our understanding (please see Appendix K for full details ) is that the imputed REC component of expenditures from the 2010 Long-Term RFP (“Imputed Long-Term Cost”) is calculated as follows:

Imputed Long-Term Cost in Delivery Year T:

(average fixed price from Long-Term RFP for Delivery Year T) x (winning contract quantities) – (price from forward price curve in Delivery Year T) x (winning contract quantities)

= (average fixed price from Long-Term RFP for Delivery Year T – price from forward price curve in Delivery Year T) x (winning contract quantities)

This calculation provides an Imputed Long-Term Cost in each Delivery Year of the Long-Term Master Agreement. The average fixed price from the Long-Term RFP can be determined on the basis of the winning bid prices and a fixed escalation factor of 2%. The price from the forward price curve is determined by the Procurement Administrator, in consultation with Staff and the Procurement Monitor, ahead of this Long-Term RFP. Appendix K, as approved by the Commission, states that the forward price curve is confidential.

ComEd is not obligated to pay any amounts that it cannot recover through its tariff. This includes Termination Payments.

The Budget announced is the amount that cannot be exceeded from the purchase of 1,400,000 RECs in the 2012-13 Delivery Year (June 1, 2012 to May 31, 2013). It does not refer only to solar photovoltaics; rather, it refers to the entire Target of 1,400,000 MWh to be procured. The Budget of $22,868,155 refers to the imputed REC component of the Bids only and is exclusive of the energy component of the Bids.

The photovoltaic target to be used in this RFP is based on an assessment by the IPA on how it will comply with Section 1-75 of the IPA Act in the years 2012 and beyond. In addition, which bids are ultimately accepted is a matter that will be approved by the Illinois Commerce Commission. We note that (1) deliveries under this procurement event extend from 2012 to 2032 and that the target for photovoltaics during seventeen (17) of the twenty (20) years of the contract will be at 6%; and (2) the Act requires for the 2012-13 procurement year a target of at least 0.5% so that the Act in no way precludes or renders unusual the setting of a 6% target.

Unfortunately, the RFP does not accommodate such a situation. The certifications of the Part 1 Proposal are made by an Officer of the entity that will sign the Long-Term Master Agreement. All information for the preparation of the Long-Term Master Agreement is provided by the Bidder in the Part 1 Proposal so that the Bidder can provide the signed Long-Term Master Agreement along with all necessary documents with the Part 2 Proposal. We note that there are assignment provisions under the Long-Term Master Agreement; see section H of the Confirmation.

There is no obligation under the contract for the Supplier to build the unit to any specific capacity. The Seller has an obligation to produce each year the Annual Contract Quantity, which applies to both energy and RECs. The Annual Contract Quantity is the quantity selected by the Procurement Administrator and approved by the ICC. The Seller may choose the specific capacity of its unit understanding that its payment under the Long-Term Master Agreement will be the difference between the fixed price and floating price applied to a volume that will be calculating as a percentage of the energy produced by the Project and understanding that the Annual Contract Quantity constitutes a minimum delivery quantity under the contract. A Bidder that has Bids that are selected and approved by the Commission will be permitted but not required to adjust the Applicable Percentage. This will enable the Bidder to configure actual construction to the award.

If a Bidder submits multiple Bids and some (but not all) of the Bids are above the benchmarks then the Procurement Administrator will eliminate only those Bids that are above the benchmarks. We note that a Bidder may submit a maximum of three (3) Bids. The first Bid (“Bid 1”) is for the Minimum Annual Quantity. The second Bid (“Bid 2”) is for any incremental quantity up to and including the Intermediate Annual Quantity. The third Bid (“Bid 3”) is for any further quantity incremental to the Intermediate Annual Quantity, up to and including the Maximum Annual Quantity. Bid 3 must be greater than Bid 2 and Bid 2 must be greater than or equal to Bid 1. If the Procurement Administrator selects the Project, the Procurement Administrator may select any integer quantity that is not less than the Minimum Annual Quantity and not more than the Maximum Annual Quantity. The Price Bid is the weighted average of the Bids for the quantity selected.

A Project is eligible if it is a renewable energy resource under Section 1-10 of the Illinois Power Agency Act regardless of location. However, although a Project may be located outside of the PJM or the MISO footprint, RECs procured through this Long-Term RFP must be transferred from the supplier’s account in PJM Environmental Information System (“EIS”)’s Generation Attribute Tracking System (“GATS”) or in the Midwest Renewable Energy Tracking System (“M-RETS”) to the account of ComEd in the relevant tracking system. Further, the evaluation gives preference to Projects located in Illinois and its adjoining states.

The solar target percentage is applied to the total Target for this procurement event of 1,400,000 MWh (and not on the basis of the residual excluding the wind target).

Please note that the Bidder submits a Minimum Annual Quantity, a Maximum Annual Quantity, and an Applicable Percentage in the Part 1 Proposal. The Bidder will have the option to modify the Applicable Percentage and the Minimum Annual Quantity upon submission of its Bids. The Bidder will have the option to reduce the Maximum Annual Quantity (but not to increase it) upon submission of its Bids. There is no penalty for providing a Part 1 Proposal, or a Part 2 Proposal (including an executed Pre-Bid Letter of Credit), and not submitting Bids. A Bidder is not required to submit (price) Bids once it completes the other requirements of the Part 2 Proposal.

The Procurement Administrator will inform Bidders of the amount of the Supplier Fee per MWh no later than 6 PM on the Part 2 Date, which is Friday, September 24. The Procurement Administrator provided an estimate of the Supplier Fee of $0.61/MWh at the Bidder Information Session of September 8, 2010.

The recent Procurement Plan that the Illinois Power Agency has filed with the Illinois Commerce Commission for the 2011-12 procurement period does not include a Long-Term RFP for Renewable Energy and RECs (although it does include a procurement of RECs for a one-year delivery period). The earliest that another opportunity to bid in a Long-Term RFP for Renewable Energy and RECs could occur would be for the 2012-13 procurement period. Whether such an opportunity will materialize for the 2012-13 procurement period will be known in August 2011.

The Supplier Fee is a one-time fee levied on winning Bidders and is due sixty (60) days after the ICC renders a decision approving the results of the procurement event.

Please note that the Bidder first submits a Minimum Annual Quantity, a Maximum Annual Quantity, and an Applicable Percentage in the Part 1 Proposal (rather than in the Part 2 Proposal). The Bidder will have the option to modify the Applicable Percentage and the Minimum Annual Quantity upon submission of its Bids. The Bidder will have the option to reduce the Maximum Annual Quantity (but not to increase it) upon submission of its Bids. Please see Paragraph V.5.5 of the RFP Rules.

The relevant excerpt from Appendix K, which was approved by the ICC, is below. Items that go specifically to your question are bracketed by ***. “Application to the RPS. The IPA intends to count the REC portion of the procurement toward the RPS requirements and bill-impact cap. To quantify the annual cost of the RECs for the purpose of the RPS, the Procurement Administrator, in consultation with the IPA, ICC Staff, and the Procurement Monitor shall develop a confidential 20 year forward price curve for energy at the load zone, including the estimated magnitude and timing of the price effects related to federal carbon controls. Each forward curve shall contain a specific value of the forecasted market price of electricity for each annual delivery year of the contract. ***In every delivery year, the imputed REC component of expenditures under the bundled renewable contracts will be determined as the difference between the expected annual contract expenditures for that year (based on the winning target Contract Quantities and Contract Prices) and the total target Contract Quantities times the forward price curve for each respective load zone for that year. For purposes of determining the maximum expenditure allowed under the RPS bill-impact cap, the forward price curve values will be fixed over the life of the contracts and cannot be subsequently changed or updated, except as follows: if, in any year, the expected annual contract spend is lower than the total Contract Quantities times the forward price curve value for that year, the forward price curve will be updated by the Procurement Administrator, in consultation with the IPA, ICC Staff, and the Procurement Monitor using then currently available price forecast data. If the expected annual contract spend is still lower than the total Contract Quantities times the updated forward price curve value for that year, the REC portion of the bundled bids will essentially become a credit, and the Commission will determine at that time, how to account for that credit in the determination of the bill-impact cap.***” Our understanding is that the imputed REC component of expenditures from the 2010 Long-Term RFP (“Imputed Long-Term Cost”) is calculated as follows: Imputed Long-Term Cost in Delivery Year T: (average fixed price from Long-Term RFP for Delivery Year T) x (winning contract quantities) – (price from forward price curve in Delivery Year T) x (winning contract quantities) = (average fixed price from Long-Term RFP for Delivery Year T – price from forward price curve in Delivery Year T) x (winning contract quantities) This calculation provides an Imputed Long-Term Cost in each Delivery Year of the Long-Term Master Agreement. (A “Delivery Year” is from June 1 of a year to May 31 of the following year). The average fixed price from the Long-Term RFP can be determined on the basis of the winning bid prices and a fixed escalation factor of 2%. The price from the forward price curve is determined by the Procurement Administrator ahead of this Long-Term RFP. Thus, at contract execution, the Imputed Long-Term Cost for the awarded Contract Quantities can be calculated for each Delivery Year of the contract until the Delivery Year where such calculation would require an update to the forward price curve, which we discuss in more detail below. The Renewable Resource Budget (“Budget”) for each Delivery Year is a limit on the amount that may be spent in a given Delivery Year on renewable resources in accordance with the Illinois Power Agency Act (“Act”). The Budget is calculated in accordance with Section 1-75(c) of the Act. According to the most recently filed IPA procurement plan being considered by the Commission, starting in 2012, the Budget in a Delivery Year is calculated as $2.158/MWh times the forecasted sales for that Delivery Year. (The amount per MWh is calculated as the greater of: (i) 2.015% of the amount paid by eligible retail customers during the year ending May 31, 2007, which is 2.015% of $93.88/MWh; and (ii) the incremental amount that could be paid by eligible retail customers in 2011 compared to 2010, which is $2.158). The forecasted sales for a Delivery Year will be determined in the prior Delivery Year and the Budget will be definitively calculated at that time. In the past, the Budget has been part of the Procurement Plan filed each year by the IPA and approved by the Commission. Thus, although the Imputed Long-Term Cost for each Delivery Year is in principle known at contract execution, the Budget is not, as it depends on sales for the Delivery Year, forecasted as of the prior year. How the Imputed Long-Term Cost for each Delivery Year compares to the Budget, and whether the Imputed Long-Term Cost is less than, equal to, or greater than the Budget, is not known at contract execution, and will need to be determined on a year-by-year basis. Whether an update to the FPC is required is determined by comparing the Imputed Long-Term Cost to zero (not comparing the Imputed Long-Term Cost to the Budget). The circumstances that trigger an update to the FPC are specified by Appendix K (see excerpt above). The FPC is updated if the Imputed Long-Term Cost is less than zero, meaning that the forward price for a given Delivery Year exceeds the average fixed price from the Long-Term RFP for that same Delivery Year. Once the FPC is updated, the Imputed Long-Term Cost would be re-calculated using the updated FPC. The Imputed Long-Term Cost may be positive or negative after the update to the FPC. If the updated FPC results in a positive Imputed Long-Term Cost, it will be determined at that time whether this Imputed Long-Term Cost is less than, equal to, or greater than the Budget for that Delivery Year. If the updated FPC continues to result in a negative Imputed Long-Term Cost, meaning the that the Imputed Long-Term “Cost” is essentially a “Credit” rather than a subtraction from the Budget, the Commission will at that time determine how that credit will enter into the determination of the Budget. Returning to the specifics of your question, it appears to us that you believe that the “imputed value for RECs” could only potentially go over the Budget once the “FEPC” is reset. This is incorrect, as explained above.

Please see Section F of the Confirmation under “Additional Provisions”. The reference is to legislation in general and does not mention Dodd-Frank in particular:

 “F. Federal Law and Regulations If federal law or regulations related to over-the-counter derivatives are adopted or implemented that significantly affect the benefits and burdens that are reflected in this Agreement or in the December 28, 2009 Order issued by the Illinois Commerce Commission in Docket No. 09-0373 (for example, regulations that would require margining of Buyer), the Parties shall use commercially reasonable efforts to reform this Agreement in order to give effect to the original intentions of the Parties regarding the appropriate benefits and burdens to each Party. In the event that the Parties, through the exercise of reasonable diligence and effort, are unable to reform the Agreement in the manner described on a mutually acceptable terms, then the Agreement shall be deemed to be terminated and shall be of no further force and effect. Upon such termination, neither party shall have any further liability to the other; provided, however, that any amounts then due under the Agreement will not be affected by such termination.”

 Please note that this provides both parties with the same termination rights.

The deadline for the Submission of Part 1 Proposals is 12PM (noon) CPT on Monday, September 13, 2010. The Part 1 Proposal should include three (3) hard copies of the Part 1 Form with original signatures as well as an electronic Part 1 Form and all other documents required by that Part 1 Form. Comments on the Post-Bid Letter of Credit are optional; however, if you choose to submit such comments, they are due with the Part 1 Proposal on September 13, 2010. You are strongly encouraged to submit the Part 1 Proposal by the deadline even if the Part 1 Proposal is incomplete. You will be provided with additional time to cure any deficiencies if the Part 1 Proposal is received by the deadline; however, no late Part 1 Proposals will be accepted. Part 1 Proposal materials must be sent to the following address: NERA – Procurement Administrator 2010 ComEd Long-Term RFP 875 North Michigan Ave, Suite 3650 Chicago, IL 60611

The certification required in the Part 1 Proposal is sufficient for purposes of qualification and winning in the RFP. The development status of the projects, as well as all other qualification criteria, are assessed on a pass or fail basis so as to allow an evaluation of the Bids on the basis of price and the priorities of the Act.

The certification required in the Part 1 Proposal must be provided for each Project as defined in the RFP Rules (i.e., each generation unit that has a separate revenue quality meter and that would be the object of a separate Confirmation under the Long-Term Master Agreement).

The instruction to “manually insert” the name of the Project refers to the fact that the form will not automatically fill out the name of the Project if you insert the name of the Project in a single field. The name of the Project must be inserted on every page and we expect Bidders to type in the name of the Project in the field provided.

We suggest that you consult with your counsel as to which situation could make you unable to make this certification. Please see the ISDA Master Agreement. The certification that you quote above is required upon qualification to ensure that you can make the representation in Paragraph 3(c) of the ISDA Master Agreement. There can be no modifications to the Long-Term Master Agreement and thus no exception to this particular certification, which is required upon qualification.

There is no in-service date requirement per se. The June 1, 2012 is the start date for performance under the Long-Term Master Agreement. This date is fixed and applies equally to all resource types.

The target is a percentage. The evaluation of Bids and the selection of renewable energy resources first give priority to cost effectiveness, second to resource type, and last to location. On September 10, 2010, it was announced that for renewable energy resources of a given price and a given location, renewable energy resources from wind resources and solar photovoltaic resources are selected over other renewable energy resources eligible under the Act, subject to a 75% threshold for wind and to a threshold of 6% for solar photovoltaic. 

We note that the threshold of 6% is not a “carve-out” in the sense that there is no specific number of MWh for which only solar photovoltaic resources can be purchased. Under the selection criteria specified in the Illinois Power Act, including the use of benchmarks, it is possible for the entire 1,400,000 MWh to be purchased without the selection of solar photovoltaic resources up to the threshold.

Please submit any question you may have regarding the Long-Term RFP through the RFP Web site: http://www.comed-energyrfp.com/questions.asp Should we require the expertise of the IPA, the utilities, the Procurement Monitor, or the Commission Staff, we will contact such a person on your behalf and provide a response by email.

We did not obtain the consent of attendees for the release of their names or contact information or for the release of the fact that they attended the workshops. We suggest that you rely on the service list for the proceeding in front of the Illinois Commerce Commission held concerning the Procurement Plan including this Long-Term RFP, which can be found here: http://www.icc.illinois.gov/docket/ServiceList.aspx?no=09-0373

The Procurement Administrator will consider on a case-by-case basis any situation that was not specifically contemplated by the RFP Rules and thus we cannot offer a definitive response to your question. We offer this response as indicative only. It is not necessarily the case that different legal entities are considered separate bidders. In a situation where separate legal entities operate under a single holding company, for example, the Procurement Administrator expects to consider the holding company (or the group of subsidiaries) to form a single Bidder. Bidders are permitted to submit multiple bids and the intent is not to limit a holding company or group of project-specific entities from doing so because of the corporate structure of the Bidder. It is expected that the Bidder will be required to:

• Submit a Part 1 Proposal for each Project;
• Submit a single Bid Participation Fee;
• Specify in the Part 1 Proposal the legal entity that would be signatory to a Long-Term Agreement with ComEd for a given Project and provide all necessary information for that legal entity in Section 7 of the Part 1 Form;
• Submit a Part 2 Proposal for each Project;
• Submit a signed Long-Term Master Agreement and all required documents for the Long-Term Master Agreement for each Project-specific legal entity;
• Submit a single Pre-Bid Letter of Credit for all Projects.

The Procurement Administrator will consider on a case-by-case basis any situation that was not specifically contemplated by the RFP Rules upon receiving the Part 1 or Part 2 Proposal and thus we cannot offer a definitive response to your question.

We offer this response as indicative only. Paragraph IV.3.7 of the RFP Rules requires that the Officer of the Bidder certify that the Bidder is not part of a bidding agreement, a bidding consortium, or any other type of agreement with another Bidder related to bidding in this RFP. In the circumstances that you present, the holding company (or the group of subsidiaries) would be a single Bidder. The Officer from the holding company (or similar Officer for the group of subsidiaries) would make this certification with respect to other Bidders in the Long-Term RFP (other than the legal entities under the holding company that would be submitting Bids for Projects in this RFP). Bidders are permitted to submit multiple bids and the intent is not to limit a holding company or group of entities from doing so because of the corporate structure of the Bidder.

In general, if a certification cannot be made, a Bidder may state that this is the case and provide the Procurement Administrator with an explanation. The Procurement Administrator may request additional information before determining whether supplemental or substitute certifications can be provided to fulfill the requirement of the Part 1 or Part 2 Proposal or whether the inability to make a particular certification would lead to disqualification. The Procurement Administrator will ensure that any such supplement or substitute certifications fulfill the requirements of the RFP Rules and that the inability to provide the certifications is not a circumvention of the intent of the RFP rules, but result from the corporate structure used for valid business reasons.

Please review the final Long-Term Agreement posted on September 7, 2010. In particular, please see Section F of the Confirmation under “Additional Provisions”. The provision references legislation in general and is applicable to Dodd-Frank legislation.

This provision does not modify the product definition from a financially settled swap to a physical sale and purchase. We are unaware whether the Ameren contract includes such a provision and cannot opine on how it would be implemented. We note that behind the meter generation, i.e., generation delivered neither to a transmission nor to a distribution system, does not qualify for the Long-Term RFP. However, any generator that delivers its output to a distribution utility qualifies, whether it is existing or new.

The deadline for the Submission of Part 1 Proposals is 12PM (noon) CPT on Monday, September 13, 2010. The Part 1 Proposal should include three (3) hard copies of the Part 1 Form with original signatures as well as an electronic Part 1 Form and all other documents required by that Part 1 Form. You are strongly encouraged to submit the Part 1 Proposal by the deadline even if the Part 1 Proposal is incomplete. You will be provided with additional time to cure any deficiencies if the Part 1 Proposal is received prior to the deadline; however, no late Part 1 Proposals will be accepted.

Section 1-10 of the Illinois Power Agency Act (20 ILCS 3855/1-10) that defines "Renewable Energy Resources" states that landfill gas only qualifies as a renewable energy resource if it is in the State of Illinois. Landfill gas from other states and/or adjoining states is not considered a renewable energy resource under the Act (and thus for this RFP).

Please also note that while qualified solid waste energy facilities ("QSWEF"), within the meaning of section 8-403.1 of Illinois Public Utilities Act, are eligible to participate in ComEd's Renewables RFP, such facilities will no longer be eligible to sell electricity to ComEd pursuant to the provisions of section 8-403.1 (see 220 ILCS 5/8-403.1(m)) should any of the bids from such facilities be selected and accepted by the Illinois Commerce Commission.

Yes, according to Section V.5.5 of the RFP Rules, the Bidder may, in the Bid Form, modify these aspects of the Proposal submitted with the Part 1 Proposal as follows. A Bidder may (i) modify the Applicable Percentage; (ii) decrease the Maximum Annual Quantity; and (iii) modify the Minimum Annual Quantity. If a Bidder modifies the Applicable Percentage, the Bidder will be required to resubmit the certification of Paragraph IV.2.6 with its Bids.

The Floating Price under the Long-Term Master Agreement is the Day-Ahead Locational Marginal Price (“LMP”) at the ComEd zone. The Confirmation to the Long-Term Master Agreement provides the precise node, which is Pnode ID 33092371. The Floating Price will be available on the PJM Day Ahead Energy Market page under the headings "Daily Day-Ahead LMP".

There is a difference between (1) not providing Bids; and (2) providing Bids, getting selected, and failing to execute the contract. There is no penalty for providing a Part 2 Proposal, including an executed Pre-Bid Letter of Credit, and not submitting Bids. A Bidder is not required to submit Bids once it completes the other requirements of the Part 2 Proposal. In the Part 2 Proposal, the Officer of the Bidder certifies and undertakes that if the ICC approves the Bidder’s Bids, a binding and enforceable obligation arises under the terms of the Long-Term Master Agreement to execute the Confirmation for the Project for which the Bidder’s Bids are approved by the ICC. The Officer further certifies that the Bidder’s Bids constitute a binding and irrevocable offer to deliver to ComEd the Annual Contract Quantity of RECs associated with the energy generated by the Project at the Price Bid and under the terms of the Long-Term Master Agreement. The Bidder will, at that point, have signed the Long-Term Master Agreement and will have provided all necessary signed documents of the Long-Term Master Agreement. If the Bidder fails to proceed to execute the Confirmation, or to provide all documents required by the Long-Term Master Agreement in a form acceptable to ComEd, or to post collateral as required by the Long-Term Master Agreement, ComEd may draw upon the Pre-Bid Letter of Credit. Further, the failure of the Bidder to proceed may be Event of Default under the contract. If an event of default were to occur ComEd would be entitled to declare an early termination event and pursue all legal remedies including the assessment of an Early Termination Payment. We suggest that you review the Agreement with Counsel as we can not provide legal advice as to the exact consequences and liability.

There is one Part 1 Proposal per facility or Project. A Bidder may submit multiple Part 1 Proposals, one for each of multiple facilities or Projects.

The tailoring of the ISDA Master Agreement conforms with Appendix K (which are the Supplemental Recommendations filed by the Illinois Power Agency and approved by the Illinois Commerce Commission). We are unaware that this form of contract would affect participation in the RFP.

This contract is for a fixed for floating price energy swap, not for physical deliveries of energy, and thus the Power Annex will not be included with the ISDA Master Agreement. This contract will however require delivery of associated RECs in the ComEd GATS and M-RETS accounts.

This information is provided in the Sample Confirmation to the ISDA Master Agreement. The Pnode ID is the ComEd Zone in the day-ahead market, which is 33092371.

Yes. Please see Appendix K, the Supplemental Recommendations filed by the Illinois Power Agency as part of the procurement plan for this long-term renewables RFP (page 2):

“The procurement process for Long-Term PPAs, on a stand-alone basis, will be designed and conducted in accordance with Section 16-111.5 of the Public Utilities Act and Section 1-75 of the Illinois Power Agency Act and the preferences set forth in Section 1-75(c) of the Illinois Power Agency Act shall be applied to the selection process (e.g., “[t]o the extent it is available, at least 75% of the renewable energy resources . . . shall come from wind generation;” it shall be “cost-effective” as defined in that Section; the locational preferences shall be applied as set forth in that Section). 20 ILCS 3855/1-75(c).”

No. ComEd will not be posting margin. Please see Appendix K, the Supplemental Recommendations filed by the Illinois Power Agency as part of the procurement plan for this long-term renewables RFP (page 6). Appendix K states that the contract will be a non-margining contract as long as the Contract Value exceeds the Around-The-Clock Value, which defines the circumstances under which ComEd would post margin. The Commission approved Appendix K as part of its Order on this procurement event.

There will be a target percentage of solar photovoltaics that will be announced as soon as practicable. Starting on June 1, 2011 (and thus during the period covered by the ISDA Master Agreement) the locational preference is for Illinois and its adjoining States over other States. The adjoining states are Wisconsin, Iowa, Missouri, Kentucky, Indiana and Michigan. Please note that for this procurement there is no longer a specific locational preference for Illinois alone.

The draft ISDA Master Agreement requires that the energy be delivered to the grid. It is our understanding that behind-the-meter installations would not be able to meet this requirement.

All Bidders are required to post a Pre-Bid Letter of Credit in an amount of $0.50 times the Annual Contract Quantity times 3. Please see Section V.2 of the RFP Rules, posted here: http://www.comed-energyrfp.com/ltdocuments.asp

There is no unsecured credit under the draft ISDA Master Agreement and the use of corporate guaranties is not contemplated under the ISDA Master Agreement.

It is anticipated that the Part 1 Proposal will be due at noon (Central Prevailing Time or “CPT”) September 13, 2010, that the Part 2 Proposals will be due at noon (CPT) on September 24, 2010, and that the Bids will be due between 10 AM and noon on September 30, 2010.

No.  Our understanding is that the RFP for the Ameren Illinois Utilities requires a pre-bid security amount of $100K. The RFP for ComEd requires a pre-bid security in an amount of $0.50 multiplied by three times the Annual Contract Quantity up to a maximum of $2.1 million. Please see Section V.2 of the RFP Rules.

The Pre-Bid Letter of Credit will be posted in Word format no later than September 7, 2010. However, we understand your concern and we are in process of arranging for an earlier posting. We will advise you of an earlier posting if it occurs.

We will issue the Part 1 Form in Word format on September 7, 2010, and earlier if at all feasible. You can find the calendar here: http://www.comed-energyrfp.com/calendar.asp

The accelerated schedule has not been adopted and the final documents are expected to be available on September 7, 2010. The schedule is posted here: http://www.comed-energyrfp.com/calendar.asp

On November 9, 2009, the IPA filed Supplemental Recommendations for the Procurement Plan supplementing or modifying the IPA’s prior proposal to procure energy and renewable energy credits on a long-term basis. The Illinois Commerce Commission ("ICC") approved Appendix K. The Motion for leave to file the Supplemental Recommendations states: "The REC portion of the procurement will count toward the RPS requirements and bill-impact cap set forth in Section 1-75(c) of the Illinois Power Agency Act. Id." (p. 2, item 6c).

The manner in which the bill-impact cap will be applied is specified in Appendix K, under the item "Application to the RPS" (pp. 2-3).

Further, the Procurement Administrator will announce shortly a Budget for the long-term RFP. The evaluation and selection of bids in no case will result in the procurement of an aggregate quantity that exceeds the Target of 1,400,000 MWh annually or that combine to cost more than the Budget.

We expect the final documents to be available on September 7, 2010, one day before the Part 1 Window opens and Bidders are invited to provide project information.

The Part 1 Window is from September 8, 2010 to September 13, 2010. The Part 2 Window is from September 21, 2010 to September 24, 2010. Final RFP documents and the Master Agreement are expected to be issued on September 7, 2010. The calendar for the ComEd Long-Term RFP can be found here: http://www.comed-energyrfp.com/calendar.asp

Although we will require that the Bidder specify the Annual Contract Quantity and Applicable Percentage in the Part 1 Form, we anticipate revising the RFP documents to allow the bidder to modify or amend the Applicable Percentage and the Annual Contract Quantity on the bid form. Such revisions will be reflected in the final RFP documents expected to be posted on September 7, 2010.

The Draft RFP Rules, posted on August 24, 2010, provide that a supplier may specify a Minimum Quantity for a Project (see Paragraph IV.3.3). The Minimum Quantity would represent the smallest quantity of RECs and associated energy for which the Bidder is willing to enter into the Long-Term Master Agreement for the Project at the price specified in the Bid.

Please see the definition section of the Confirmation, which states: “’REC’ means a renewable energy certificate, credit or other transferable indicia indicating the generation of a MWH of energy from a Renewable Energy Resource, including all of the environmental attributes associated with the generation of that electricity.”

The items to be included in the Part 1 Proposal are described in Article IV of the Draft RFP Rules as well as in Appendix 2 to the RFP (the Part 1 Form). Both documents were posted to our web site on August 24, 2010.

A workshop for public comments on the Draft 2011 IPA Procurement Plan and a workshop to discuss the Draft ISDA Master Agreement for the 2010 long-term renewable energy and RECs RFP are both being held on August 31, 2010. The first workshop will take place in Springfield while the second workshop will take place in Chicago. We apologize for any inconvenience caused by both workshops being held on the same day.

The intent is for each generating unit (tied to a revenue quality meter) to be identified in a separate confirmation should one bidder have multiple bids for multiple generating units approved by the Commission. The remainder of your submission appears to be comments rather than questions. We will consider your comments along with other comments on the Draft ISDA Master Agreement.

A bidder that has more than one generating project (each project being tied to a revenue quality meter) will submit one Proposal for each generating project. Such a bidder also will submit one Bid for each generating project, identifying for that particular generating project the bid price, the Annual Contract Quantity, the Minimum Quantity, and the Specified Percentage. If the Procurement Administrator recommends one or more Bids to the Commission and the Commission approves these Bids, the bidder would execute Confirmations under the ISDA Master Agreement for the particular generating projects for which Bids were approved. The bidder will not be permitted to identify the projects after the bids are approved.

Yes, resource factor is the same as resource value; thank you for bringing this inconsistency to our attention. The Procurement Administrators will calculate the resource factors and announce these to the bidders in advance of bidding.

The Procurement Administrator, in consultation with the IPA, the Procurement Monitor, and the ICC Staff will develop confidential benchmarks to protect consumers that will be approved by the ICC for the resources procured under this solicitation. The benchmarks will be used to evaluate bids and to reject bids that exceed the benchmarks. Additional information regarding the benchmarks is confidential.

The workshops are in-person meetings.

The Microsoft Word version of the Part 1 Form will be provided no later than September 7, 2010 and earlier if feasible.

You may be referring to a statement made during the bidder information call that ComEd will not post collateral under the contract. Only the Seller is required to post security under the terms of the Draft ISDA Master Agreement. If the Seller chooses to post collateral in the form of cash, under the terms of the Draft ISDA Master Agreement, the Seller has the option for the cash to be held by ComEd or by its Custodian. If cash is held by ComEd, no interest is paid or fees collected. If cash is held by the Custodian, ComEd will pay to or collect from the Seller the amount of interest net of all fees. ComEd would collect from the Seller if fees exceed the amount of interest. Please see section (g) of Paragraph 13 of the Collateral Support Annex. For its Custodian, ComEd will use a Qualified Institution meeting the requirements as defined in Paragraph 13 to the Credit Support Annex section (o). This institution will be a large commercial bank.

Under the ISDA Master Agreement, ComEd may require the Seller to provide performance assurance for the amount of the Seller's exposure. The Seller's exposure includes the energy exposure as well as the REC exposure. The REC exposure is equal to $5 multiplied by three times the Annual Contract Quantity. ComEd intends to make a request for the REC exposure by noon on the business day following the day the Confirmation is fully executed. The Confirmation is expected to be fully executed no later than three business days after an approval by the ICC of the results of the procurement event for long-term renewable energy and RECs. Following such a request, the Seller must post the required collateral by the close of business on the next business day.

The transaction contemplated by the contract encompasses two items: 1) a fixed price for floating price energy swap; and, 2) the delivery of RECs, both tied to the production of the generating unit identified in the Confirmation. There are no provisions that would allow the assignment to another generating unit during the term of the contract. Please note that there is currently a comment process on the Draft ISDA Master Agreement and you are free to propose a provision to this effect as a comment. The invitation to comment on the contract is posted here.

Yes, you need to be able to point to a specific project. The transaction contemplated by the contract encompasses two items: 1) a fixed price for floating price energy swap; and, 2) the delivery of RECs, both tied to the production of the generating unit identified in the Confirmation.

The contract is posted to the Long-Term Renewable Energy and RECs Documents pageunder the heading ISDA Master Agreement (DRAFT) (August 13, 2010). Your proposed changes should be incorporated in the Schedule to the Master Agreement, Paragraph 13 of the CSA, Schedules 1 and 2 of the CSA, or in the Sample Confirmation, all of which contain the specific terms of the contract tailored for this transaction. All of these are posted as Microsoft Word documents.

The exclusive method for submitting comments is electronically in Microsoft Word with tracked changes (redline markup of a document). You are strongly encouraged to provide an accompanying document with explanatory notes or to add an explanation beside each tracked change. Please submit your comments by email to the Procurement Administrator at pa@ComEd-EnergyRFP.com. Please provide phone and email contact information in the event that clarification is needed regarding your comments. More information on the comment process is available in our invitation to provide comments, which is posted to the Long-Term Renewable Energy and RECs Documents page.

That is correct.

ComEd may not consider a REC-only fixed price offer. The Procurement Plan approved by the Illinois Commerce Commission specifies that the transaction will be for renewable energy and RECs. It also specifies that a single bundled price will be bid for both energy and RECs.

The anticipated start of delivery under contracts from the Long-Term RFP is anticipated to be June 1, 2012. The Illinois Power Agency Act was amended so that a specified amount of renewable energy resources would be procured from photovoltaics starting in 2015. Bill HB6202, expected to become law, would further amend this provision to allow for a ramp-up to the photovoltaic requirement starting in 2012. The Commission Order regarding this Long-Term RFP provides that it will be conducted in accordance with the preferences of the Illinois Power Agency Act. The Draft Long-Term RFP is expected to be posted on August 24, 2010 and the documents will at that point provide information regarding the way in which the preferences of the Illinois Power Agency Act will be recognized in the Long-Term RFP, including any preferences for solar.

The Draft Long-Term RFP is due to be released on August 24, 2010 and would set out the conditions for eligibility.

We also draw your attention to the Draft ISDA Master Agreement, which was posted on August 13, 2010. The Draft ISDA Master Agreement provides for a constant quantity of energy and associated RECs in every year of the contract. The Draft ISDA Master Agreement addresses potential short-falls in RECs and energy in Paragraphs 3 and 4 of Section B of the Confirmation.

The workshops are currently expected to be held on August 30, August 31, as well as September 1 in Chicago. It is expected that the workshop on August 30 will be a bidder meeting on the terms of the Long-Term RFP for both the ComEd and Ameren portfolios and it is expected that the meeting would start early in the afternoon. This tentative schedule is subject to availability of a suitable venue and we expect to confirm the schedule shortly. Please stand by for an announcement early in the week of August 16.

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