Draft of 12/1/08
REQUEST FOR PROPOSALS
FOR
RESOURCES QUALIFIED TO PARTICIPATE
IN PJM’S FULL EMERGENCY LOAD
RESPONSE PROGRAM
[UTILITY NAME]
ISSUE DATE: ____________, 200__
REQUEST FOR PROPOSALS
FOR
RESOURCES QUALIFIED TO PARTICIPATE IN PJM’S
FULL EMERGENCY LOAD RESPONSE PROGRAM
TABLE OF CONTENTS
1.
2.
INTRODUCTION .......................................................................................................1
RFP PROCESS AND SCHEDULE ............................................................................1
2.1
Overview and Schedule .......................................................................................1
2.2
Notice of Intent to Bid .........................................................................................2
2.3
Buyer – Bidder Communications.........................................................................2
2.4
Proposal Submittal ...............................................................................................2
2.5
Proposal Clarifications .........................................................................................3
3. ELIGIBILITY REQUIREMENTS..............................................................................3
3.1
Qualified Load Management Resources ..............................................................3
3.2
Delivery of Load Management Resources ...........................................................3
3.3
Commencement of Service ..................................................................................4
3.4
Requirements .......................................................................................................4
3.5
Restrictions ..........................................................................................................4
4. PROPOSAL REQUIREMENTS .................................................................................4
4.1
Quantity................................................................................................................4
4.2
Contract Pricing and Non-Performance Penalties ...............................................5
4.3
Term .....................................................................................................................5
4.4
Effectiveness of Proposal .....................................................................................5
4.5
Participation Agreement ......................................................................................5
5. SUBMISSION OF PROPOSALS ...............................................................................5
5.1
Proposal Fee .........................................................................................................5
5.2
Ownership of Material .........................................................................................6
6. PROPOSAL EVALUATION PROCESS ...................................................................6
6.1
Evaluation Factors ...............................................................................................6
6.2
Sample of Proposal Evaluation Methodology .....................................................7
6.3
Non-Interference By Bidders ...............................................................................7
7. CREDIT SUPPORT; SECURITY FOR PERFORMANCE .......................................7
8. COMMISSION APPROVAL .....................................................................................7
9. CONFIDENTIALITY .................................................................................................8
10. MEASURES TO PROTECT AGAINST SELF-DEALING.......................................8
11. NON-DISCRIMINATION POLICY ..........................................................................9
12. GENERAL DISCLAIMER AND RESERVATION ..................................................9
ATTACHMENT A
ATTACHMENT B
ATTACHMENT C
ATTACHMENT D
FORM OF PARTICIPATION AGREEMENT
FORM OF NOTICE OF INTENT TO BID
FORM OF PROPOSAL
SAMPLE PROPOSAL EVALUATION METHODOLOGY
REQUEST FOR PROPOSALS
FOR
RESOURCES QUALIFIED TO PARTICIPATE IN PJM’S FULL
EMERGENCY LOAD RESPONSE PROGRAM
1.
INTRODUCTION
Through the issuance of this Request for Proposals (“RFP”),
___________________ (“_________” or “Buyer”) is soliciting proposals (each, a
“Proposal”) for Capacity Resources from Demand Resources and Interruptible
Load for Reliability resources (collectively, “Load Management Resources”)
located in the Maryland service territory of Buyer to participate in the Full
Program Option of PJM Interconnection L.L.C.’s (“PJM”) Emergency Load
Response Program (“Full Emergency Load Response Program”). Buyer is
seeking to contract with the Load Management Resources individually, or through
an entity aggregating Load Management Resources (a “Supplier”), for up to __
megawatts of Unforced Capacity (UCAP).1 Bidders can offer Proposals for single
or multiple year commitments during the five-year term beginning June 1, 2011
and ending May 31, 2016, and for the two-year option period from June 1, 2016
through May 31, 2018 (described below). The Load Management Resources need
not be available for the start of, or full duration of, this supply period. Capitalized
terms used herein and not otherwise defined shall have the meanings given to
such terms in PJM’s Reliability Assurance Agreement, Open Access
Transmission Tariff and related PJM agreements and manuals.
Buyer will evaluate Proposals from bidders (each, a “Bidder”) based on the
factors outlined in this RFP. Buyer’s acceptance of any Proposal submitted
hereunder will be subject to the execution of a definitive Participation Agreement
(“Participation Agreement”) by the Bidder and the Buyer and approval of such
Participation Agreement by the Maryland Public Service Commission (the
“Commission”). The form of Participation Agreement is included as Attachment
A of this document.
This RFP is being issued pursuant to a Commission Order issued in Case
No. 9149.
2.
RFP PROCESS AND SCHEDULE
2.1
Overview and Schedule
The overall schedule for this RFP is set forth below.
1
64 MWs for Delmarva Power & Light Company and 185 MWs for Potomac Electric Power Company.
EVENT
Issuance of RFP by Buyer
Notices of Intent to Bid due
Deadline for submittal of questions
Proposals due
Notification of winning Bidders
Target deadline for execution of Participation
Agreements
Application for approval of executed Participation
Agreements filed with the Commission
2.2
DATE/DEADLINE
Notice of Intent to Bid
On or before ____________, 200__, each Bidder intending to submit a Proposal
is required to deliver to Buyer a Notice of Intent to Bid for each such Proposal in
the form of Attachment B (a “Notice of Intent to Bid”). Bidders may submit
Notices of Intent to Bid either: (i) via e-mail to _____@____.com (the “RFP Email Address”); or (ii) by faxing a fully completed Notice of Intent to Bid to
Buyer at __________. Regardless of method, all Notices of Intent to Bid must be
received by Buyer on or before 11:59 p.m. (EST) on ____________, 200__.
Submission of a Notice of Intent to Bid does not obligate a Bidder to submit a
Proposal.
After ____________, 200__, correspondence from Buyer regarding this RFP will
be forwarded only to Bidders that have submitted a timely Notice of Intent to Bid.
2.3
Buyer – Bidder Communications
Bidders seeking to contact Buyer regarding this RFP must do so by submitting
questions to Buyer at the RFP E-mail Address. Questions submitted to the RFP
E-mail Address shall be the sole means for Bidders to communicate with Buyer.
Questions from Bidders will be accepted through the RFP E-mail Address until
11:59 p.m. (EST) on ____________, 200__. Buyer will attempt to post answers
to any such questions by ___________, 200__. Buyer’s responses to any
questions will be provided to all Bidders by e-mailing responses to the point of
contact listed in the Notice of Intent to Bid, unless a Bidder demonstrates that a
question pertains to a confidential and unique aspect of a Proposal, in which case,
Buyer will attempt to respond only to the Bidder that posted the question.
2.4
Proposal Submittal
On or before ____________, 200__, each Bidder intending to submit a Proposal
is required to deliver such Proposal to Buyer in the form of Attachment C. An
electronic version of a Bidder’s Proposal, in PDF format, must be submitted to the
RFP E-mail Address on or before 11:59 p.m. (EST) on ____________, 200__. In
2
addition, ten (10) bound paper copies of the Proposal must also be sent via
overnight courier to:
Buyer:
Name:
Address:
Tel:
Fax:
Bound paper copies of the Proposal must be received by Buyer at the address
listed above by 10:30 a.m. (EST) on ____________, 200__. Buyer will provide
Bidders a confirmation of receipt of the submitted Proposals. Such confirmation
will indicate only that Buyer has received a Proposal and not that the Proposal is
complete. Buyer has no obligation to accept any information submitted to it after
____________, 200__.
2.5
Proposal Clarifications
During the Proposal Evaluation process, Buyer may contact Bidders to request
additional information or clarifications of their Proposals.
3.
ELIGIBILITY REQUIREMENTS
To be eligible for participation in this RFP, Proposals must meet the following
criteria.
3.1
Qualified Load Management Resources
Participating Load Management Resources must qualify for participation in the
Full Program Option of the Emergency Load Response Program and must be
customers of Buyer in the State of Maryland.
3.2
Delivery of Load Management Resources
Subject to the Load Management Resources and/or the Supplier (a) meeting the
applicable PJM requirements, and (b) providing the information required by PJM
and Buyer to do so, Buyer will submit to PJM the Load Management Resources
as follows.


Buyer will submit the Load Management Resources to PJM for
participation in the Full Emergency Load Response Program.
For Load Management Resources to be provided in PJM’s
Planning Year 2011/12, Buyer will (1) submit the Load
Management Resources into PJM’s RPM Incremental Auctions
held in connection with that Planning Year at an offer price of
zero, or (2) obtain certification from PJM for the Load
Management Resource as Interruptible Load for Reliability.
3

3.3
For Load Management Resources to be provided after PJM’s
Planning Year 2011/12, Buyer will submit the Load Management
Resources into PJM’s Base Residual Auction held in connection
with the corresponding PJM Planning Year at an offer price of
zero.
Commencement of Service
Service under a Participation Agreement executed pursuant to this RFP must
commence no earlier than June 1, 2011, and no later than June 1, 2015.
3.4
Requirements
Load Management Resources and Suppliers aggregating Load Management
Resources must agree to:

the Load Management Resources being offered to PJM as Capacity
Resources by Buyer at minimum dispatch price and/or strike price of
$0/MW.

provide a point of contact for and respond to PJM’s notification of load
curtailments under the Full Emergency Load Response Program.

provide documentation of load reduction resulting from PJM initiated load
curtailments under the Full Emergency Load Response Program in a
timely manner and sufficient to satisfy PJM’s verification requirements.
3.5
Restrictions
Load Management Resources provided in response to this RFP must not:
4.

participate in PJM’s Economic Load Response Program.

have offered into and cleared PJM’s 2011/12 RPM Base Residual
Auction.

be identified as part of the Buyer’s EmPower Plan currently before the
Commission, including load reduction resources from direct load control
of Buyer’s residential and small commercial customers.
PROPOSAL REQUIREMENTS
4.1
Quantity
Each Bidder may propose a MW amount available to participate in the Full
Emergency Load Response Program for each PJM Planning Year from the
2011/12 Planning Year (June 1, 2011–May 31, 2012) through and including the
2015/16 Planning Year (June 1, 2015–May 31, 2016) (each a “Contract
4
Amount”). In addition, each Bidder has the option of offering a Contract Amount
for PJM Planning Years 2016/17 (June 1, 2016-May 31, 2017) and 2017/18
(June 1, 2017-May 31, 2018), which Buyer can accept or reject in its sole
discretion pursuant to the terms of the form Participation Agreement.
The minimum Contract Amount to be proposed in all periods is 100 kW.
4.2
Contract Pricing and Non-Performance Penalties
Bidders are required to provide a single, fixed price in $/kW/month for the initial
term (June 1, 2011-May 31, 2016). In addition, the bidder may provide a single,
fixed price for the extension period (June 1, 2016 through May 31, 2018). The
Supplier or Load Management Resource will be responsible for all PJM penalties
and assessments associated with non-performance under the Full Emergency
Load Response Program or as a Capacity Resource.
Questions here:
Who receives the PJM RPM payments for the resource?
Is the fixed price a payment above any PJM payments?
How does performance affect the fixed price payments?
4.3
Term
Depending on the initial year the Supplier provides Load Management Resources,
Proposals shall be for an initial term ranging from one (1) to five (5) years, with
the optional two (2)-year extension term described in Section 4.1 (collectively, the
“Term”).
4.4
Effectiveness of Proposal
Each Proposal must remain open for acceptance by Buyer from the date of
submittal through ____________, 200_.
4.5
Participation Agreement
Other terms of a transaction resulting from the RFP are set forth in the form
Participation Agreement in Attachment A.
5.
SUBMISSION OF PROPOSALS
5.1
Proposal Fee
Each Bidder shall submit a nonrefundable $1,000 fee (“Proposal Fee”) for each
Proposal submitted under this RFP. Payment of the Proposal Fee is due upon
5
submission of the Proposal. Payment information, including wiring instructions,
will be provided to all parties who have provided a Notice of Intent to Bid.
5.2
Ownership of Material
All documents submitted to Buyer in connection with this RFP shall, upon
submission thereof, become the property of Buyer. Buyer is under no obligation
to return such materials to the Bidder.
6.
PROPOSAL EVALUATION PROCESS
Buyer and its consultants will evaluate each Proposal based on the criteria
outlined in this RFP. Buyer may reject any Proposal if it does not comport with
the requirements set forth in this RFP.
6.1
Evaluation Factors
Buyer will evaluate each Proposal by simulating the impact of the Proposal on the
costs paid by its customers. Buyer’s evaluation of Proposals consists of both a
price factor evaluation (“Price Factor Evaluation”) weighted at eighty percent
(80%) of Buyer’s consideration and a non-price factor evaluation (“Non-Price
Factor Evaluation”) weighted at twenty percent (20%) of Buyer’s consideration.
Price Factor Evaluation (80 Percent)
Contract Price. Buyer will compare the discounted weighted annual contract
payments to be made by Buyer under each Proposal. This evaluation will include
the expected need for Load Management Resources over the initial and extension
period. Proposals offering Load Management Resources and Contract Amounts
in the earlier years of the Term will be weighed more favorably than those
Proposals providing more of the Proposal’s Load Management Resources and
Contract Amounts in the later years of the Term.
Non-Price Factor Evaluation (20 Percent)
Buyer will evaluate non-price factors associated with each Proposal to assess the
development and operational benefits and risks of each Proposal. The non-price
factors are:
(i)
(ii)
Load Management Resource’s environmental impact (10%); and
Bidder financial qualifications and credit support (10%).
In connection with the Buyer’s assessment of non-price factors, Bidders must
provide the maximum percentage of the Load Management Resources that will
utilize back-up generation in any delivery year in order to participate in the Full
Emergency Load Response Program. Suppliers utilizing back-up generation will
receive a lower score than Suppliers that will not utilize back-up generation.
6
Suppliers utilizing 100% load reduction will receive the highest score for
environmental impact.
6.2
Sample of Proposal Evaluation Methodology
Examples of Buyer’s anticipated methodology for evaluating Proposals are
included as Attachment D.
6.3
Non-Interference By Bidders
Bidders shall not seek to influence Buyer’s evaluation of Proposals in any way.
Attempts to do so will be grounds for disqualification from eligibility.
7.
CREDIT SUPPORT; SECURITY FOR PERFORMANCE
Within thirty (30) days of the Commission’s approval of a Participation
Agreement, and continuing through the term of the Participation Agreement, the
Supplier or individual Load Management Resource shall provide Buyer with one
or more letters of credit from a Qualified Institution2 as security for the payment
and performance of the Supplier’s obligations under the Participation Agreement.
The letter(s) of credit shall be in a total amount equal to the product of the
Buyer’s then-current PJM Resource Clearing Price and the initial Contract
Amount, multiplied by two. At the beginning of each successive PJM Planning
Year, Supplier must update or provide a new letter of credit to reflect the change
in the then-current Resource Clearing Price and Contract Amount for the new
Planning Year.
In addition, the Supplier or individual Load Management Resource will be
required to post any collateral required by PJM in connection with the
transactions contemplated hereby, including participation in PJM’s RPM and the
Full Emergency Load Response Program.
8.
COMMISSION APPROVAL
All executed Participation Agreements will be submitted to the Commission for
approval. Buyer anticipates submitting executed Participation Agreements for
Commission approval by ____________, 200__. Commission approval is needed
before December 31, 2009, to allow participation in PJM’s 2011-2012 Base
Residual Auction. If the Commission fails to approve an executed Participation
Agreement within six (6) months of filing, the Buyer and the Bidder will each
have the right to terminate the Participation Agreement without liability.
“Qualified Institution” is defined in the Participation Agreement as a U.S. commercial bank (or a foreign
bank with a U.S. branch) having total assets of at least $10 billion and a credit rating equal to or better than
“A” by Standard & Poor’s Rating Group and an equivalent credit rating by Moody’s Investor Services, Inc.
2
7
9.
CONFIDENTIALITY
Buyer will take reasonable precautions and use reasonable efforts to protect any
proprietary or confidential information contained in a Proposal, provided that the
Bidder has clearly identified such information as confidential on the page on
which it appears. Bidders acknowledge that the Buyer may be required to make
such proprietary and/or confidential information available to the Commission or
other governmental agencies.
Subject to the measures to protect against self-dealing set forth in Section 10 of
this RFP, Buyer reserves the right to release confidential information to Buyer’s
parent company, subsidiaries and affiliates, and its and their officers, directors,
employees, agents and representatives, for the purpose of evaluating Proposals
and administering Participation Agreements. Buyer will use reasonable efforts to
cause such persons or entities to observe the same care with respect to disclosure
as Buyer is obligated to use. Under no circumstances will Buyer, its parent
company, affiliates, subsidiaries, or any officers, directors, employees, agents or
representatives of any of them, be liable to any Bidder for any damages resulting
from any disclosure of information provided in response to this RFP before,
during or after the RFP process.
10.
MEASURES TO PROTECT AGAINST SELF-DEALING
Buyer will not submit a Proposal pursuant to this RFP. An affiliate of Buyer may
submit one or more Proposals, each of which will be evaluated under the same
evaluation process as all other Proposals.
In order to: (i) assure that that no affiliate of Buyer that submits a Proposal in
response to this RFP receives favorable treatment compared to other Bidders; and
(ii) maintain a functional separation between Buyer’s Proposal evaluation team
and any affiliate planning to submit a Proposal or any employee of Buyer that
may be working on a Proposal, Buyer and any affiliate intending to submit a
Proposal shall implement the following procedures:
1)
Any Proposal submitted by a Buyer affiliate will be submitted on or before
one day in advance of the due date for non-affiliate Proposals.
2)
No employee working on an affiliate Proposal or individual Proposal will
be allowed to review Proposal information, to participate in the Proposal
evaluation process as a member of the Proposal evaluation team, or to
communicate with any member of the Proposal evaluation team and vice
versa with respect to the Proposals. All Buyer employees and other
members of the Proposal evaluation team will be required to adhere to the
confidentiality procedures for Bidder information pursuant to Section 9 of
this RFP.
8
3)
11.
All requirements of the RFP, including credit support requirements, shall
apply to any affiliate of Buyer that submits a Proposal in response to this
RFP.
NON-DISCRIMINATION POLICY
Throughout the RFP evaluation, Buyer will not discriminate between, or grant
preferences to, any Bidder based on race, gender, ethnic origin, creed or religion,
in accordance with legal requirements. Buyer’s consideration, evaluation and
selection of Proposals shall be entirely based on the merits of each Proposal and
not upon unrelated factors.
12.
GENERAL DISCLAIMER AND RESERVATION
Each Bidder is responsible for its costs incurred in responding to this RFP.
Buyer has prepared the information provided in this RFP to assist potential
Bidders in deciding whether to respond. Neither the RFP nor any other related
correspondence from Buyer, its parent company or affiliates, nor its or their
employees, officers, directors, agents, or consultants shall be considered legal,
financial or other advice and do not establish a contract or any contractual
obligations.
Buyer does not make any representations or warranties regarding the information
in the RFP and does not purport that the RFP contains all information needed for
Bidders to determine whether to submit a Proposal. Neither Buyer nor its parent
company or affiliates, nor its or their employees, officers, directors, agents or
consultants will make, or will be deemed to have made, any current or future
representation, promise or warranty, express or implied, as to the accuracy,
reliability or completeness of the information contained within the RFP or any
other information provided to Bidders.
Bidders participating in this RFP shall not have legal recourse or claims against
Buyer, its parent company or any of its affiliates, or its or their employees,
officers, directors, agents or contractors, due to Buyer’s rejection, in whole or in
part, of their Proposal(s), for failure to reach agreement on a Participation
Agreement, or for any reason whatsoever related to such parties’ acts or
omissions arising out of or in connection with the RFP process or in connection
with the rejection of a Proposal by Buyer or failure by Buyer to execute a
Participation Agreement.
Buyer reserves the right to reject, for any reason or no reason, any and/or all
Proposals and shall determine in its sole discretion whether to enter into a
Participation Agreement or recommend approval of a Participation Agreement to
the Commission or other applicable governmental agencies. Buyer reserves the
right to enter into a Participation Agreement with one or more Bidders other than
the Bidder offering the lowest pricing.
9
Buyer reserves the right to modify, cancel or withdraw this RFP and to revise the
schedule specified in the RFP if, in Buyer’s sole discretion, such changes are
necessary or beneficial to Buyer. To the extent reasonably possible, Buyer will
inform Bidders that have filed a Notice of Intent to Bid of any such change.
Buyer further reserves the right to waive, in its sole discretion, any irregularity or
defect in Proposals received and to consider alternatives outside of this
solicitation.
Nothing in this RFP limits Buyer’s right, and Buyer expressly reserves its right,
to enter into one or more bilateral contracts for Capacity Resources to participate
in PJM's Emergency Load Response Program outside of this RFP process.
----
10
ATTACHMENT A
FORM OF PARTICIPATION AGREEMENT
ATTACHMENT B
FORM OF NOTICE OF INTENT TO BID
Notice of Intent to Bid
Our organization intends to submit a Proposal in response to the Buyer’s Request for Proposals
for Resources Qualified to Participate in PJM’s Full Emergency Load Response Program.
NAME OF BIDDER:
Anticipated Contract Amount
(MW):
Address:
_________________________________________________
Initial Term:
Planning Year 2011/12 - ____________________________
Planning Year 2012/13 - ____________________________
Planning Year 2013/14 - ____________________________
Planning Year 2014/15 - ____________________________
Planning Year 2015/16 - ____________________________
Extension Term:
Planning Year 2016/17 - ____________________________
Planning Year 2017/18 - ____________________________
_________________________________________________
_________________________________________________
_________________________________________________
_________________________________________________
Contact Name:
Title:
Phone:
E-mail:
_________________________________________________
_________________________________________________
_________________________________________________
_________________________________________________
Alternate Contact Name:
Title:
Phone:
E-mail:
_________________________________________________
_________________________________________________
_________________________________________________
_________________________________________________
Please return Notices of Intent to Bid via fax or e-mail no later than 11:59 p.m. (EST) on
____________, 200__ to:
Recipient:
Tel:
Fax:
E-Mail:
ATTACHMENT C
FORM OF PROPOSAL
Proposal Form
BIDDER INFORMATION
Name:
Address:
Telephone:
Fax:
Form of organization of Bidder (i.e.,
corporation, limited liability company,
partnership, etc.):
Jurisdiction of formation of Bidder:
Ultimate parent company and affiliates of
Bidder:
PROPOSAL TERMS
Initial Term
Contract Amount (MW):
PJM Planning Year 2011/12:
PJM Planning Year 2012/13:
PJM Planning Year 2013/14:
PJM Planning Year 2014/15:
PJM Planning Year 2015/16:
Contract Price ($/kW/Month):
Extension Term (Optional)
Contract Amount (MW):
PJM Planning Year 2016/17:
PJM Planning Year 2017/18:
Contract Price ($/kW/Month):
EXPECTED RESOURCE MIX
Percent of Contract Amount from Load
Management Resources expected from:
Direct Load Control (DLC) Resources:
Firm Service Level (FSL) Resources:
Guaranteed Load Drop (GLD) Resources:
Maximum Percentage of the Contract
Amount during any Planning Year provided
from Load Management Resources
classified as Guaranteed Load Drop from
back-up generation:
If applicable, all air permits and other
permits necessary and the status of those
permits:
FINANCIAL INFORMATION
Financial/Credit Contact Person:
Title:
Telephone:
Fax:
E-mail:
Federal Tax ID Number:
Dun & Bradstreet ID Number (if
applicable):
Bidder Credit Ratings (if applicable)3
- Issuer (S&P, Moody’s Fitch):
- Senior unsecured debt (S&P, Moody’s,
Fitch):
- Short-term debt (S&P, Moody’s,
Fitch):
Provide audited financial statements for the
last three years for Bidder4
3
Provide copies of ratings reports for the prior 36 months.
If audited financial statements are not available, provide unaudited financial statements with attestations
by the chief financial officer of the Bidder. If financial statements are consolidated, provide stand-alone
financial statements with attestations by the chief financial officer of the Bidder.
4
CERTIFICATION
The undersigned hereby certifies that all of the statements and representations made in
this Proposal are true and correct and agrees to be bound by the representations, terms
and conditions contained in the RFP. The Proposal reflected hereby is firm and will
remain in effect and may be accepted by Buyer through and including ____.
Name of Bidder:
_________________________________
Executed by:
_________________________________
Officer of Bidder
Title of Officer:
_________________________________
Print name of Officer: _________________________________
Date:
_________________________________
Proposal Forms should be submitted, in PDF format, via e-mail, to the RFP E-mail
Address no later than 11:59 p.m. (EST) on ____________, 200_. In addition, ten (10)
bound paper copies must also be sent via overnight courier to:
Buyer
Name:
Address:
Tel:
Bound paper copies must be received by 10:30 a.m. (EST) on ____________, 200__.
ATTACHMENT D
SAMPLE PROPOSAL EVALUATION METHODOLOGY
Sample Proposal Evaluation Methodology
Row/Column
(a)
(b)
(c)
(d)
(e)
(f)
(g)
Contract Terms
Initial Term
Extension Term
(h)
(i)
NPV Initial Term (2010$)
NPV Extension Term (2010$)
(j)
Weighted NPV of Price ($/kW/month)
(k)
Probability of Resource Need
Planning
Year
(1)
Contract
Price
$/kw/Month
2011/2012
2012/2013
2013/2014
2014/2015
2015/2016
2016/2017
2017/2018
5.0
5.0
5.0
5.0
5.0
5.0
5.0
Initial Term
(m)
Extension Term
(n)
(o)
NPV Initial Term (2010$)
NPV Extension Term (2010$)
(p)
Ratio of Price to Value
(q)
Need Adjusted Price
(s)
Premium Over Lowest Bidder
(t)
Pricing Points
(u)
Maximum Percent of Load Management
Resources from Back-Up Generators
(v)
Environmental Impact Points
(w)
Bidder Financial Rating
(x)
(y)
(3)
Annual
Payment
($)
(1)
Contract
Amount
$/kw/Month
10
10
10
10
10
10
10
600,000
600,000
600,000
600,000
600,000
600,000
600,000
5.0
5.0
5.0
5.0
5.0
0.0
0.0
42
14
2,527,418
822,011
5.0
2011/2012
2012/2013
2013/2014
2014/2015
2015/2016
2016/2017
2017/2018
2011/2012
2012/2013
2013/2014
2014/2015
2015/2016
2016/2017
2017/2018
Proposal B
(2)
Contract
Amount
(MW)
(3)
Annual
Payment
($)
(1)
Contract
Price
$/kw/Month
10
10
10
10
10
0
0
600,000
600,000
600,000
600,000
600,000
0
0
5.0
5.0
5.0
5.0
5.0
5.0
5.0
42
0
2,527,418
0
5.0
90%
80%
70%
60%
50%
40%
30%
NPV of Expected Need
(l)
Proposal A
(2)
Contract
Amount
(MW)
Proposal C
(2)
Contract
Amount
(MW)
(3)
Annual
Payment
($)
6
8
10
12
14
0
0
360,000
480,000
600,000
720,000
840,000
0
0
41
0
2,468,597
0
5.0
90%
80%
70%
60%
50%
40%
30%
90%
80%
70%
60%
50%
40%
30%
Contract
Price
$/kw/Month
Need Weighted
Contract
Amount
(MW)
Annual
Payment
($)
Contract
Price
$/kw/Month
Need Weighted
Contract
Amount
(MW)
Annual
Payment
($)
Contract
Price
$/kw/Month
Need Weighted
Contract
Amount
(MW)
Annual
Payment
($)
5.0
5.0
5.0
5.0
5.0
5.0
5.0
9
8
7
6
5
4
3
540,000
480,000
420,000
360,000
300,000
240,000
180,000
5.0
5.0
5.0
5.0
5.0
0.0
0.0
9
8
7
6
5
0
0
540,000
480,000
420,000
360,000
300,000
0
0
5.0
5.0
5.0
5.0
5.0
5.0
5.0
5.4
6.4
7
7.2
7
0
0
324,000
384,000
420,000
432,000
420,000
0
0
30
5
1,798,604
288,901
30
0
1,798,604
0
28
0
1,656,092
0
74%
6.7
71%
7.0
67%
7.5
1.00
1.04
1.10
80
77
72
100%
0%
50%
0
10
5
AAA
Investment Grade
Unrated
Financial Qualification Points
10
5
0
Total Proposal Score
90
92
77
Notes: 1) Discount rate of 6% assumed.
2) Row (j) = NPV (Contract Payments (both initial and extension terms)) / NPV(Contact Amounts (both initial and extensions terms)
3) Row (k) Place holder for expected probability of capacity shortfall for each planning year.
4) Row (p) = (row (n) + row (o)) / (row (h) + row (o))
5) Row (q) = row (j) / row (p)
6) Row (s) = row (q) / minimum of row (q)
7) Row (t) = 80 / row (s)
8) Row (v) = 10 * (1 - row (u))
9) Financial Qualifications Points = 10 for AAA rated, 5 points for investment grade, and 0 points for unrated Bidders.