10-11-2011 CC RPT 26 - Laserfiche WebLink

Home

EEI Agreement — Page 2 Many counterparties transact under the EEI Agreement either because it is their organization's agreement of choice or because they are not members of WSPP. It is appropriate and warranted to have an alternate enabling agreement in place to provide transaction flexibility and to maximize the economic benefits to Riverside for such short term power transactions. Similarities between the WSPP Agreement and EEI Agreement include: (i) both provide a vehicle for physical power transactions; (ii) they are both regulated by Federal Energy Regulatory Commission (FERC); and (iii) the non -rate terms and conditions in the WSPP Agreement and EEI Agreement are similar in transaction and settlement mechanics. Slight differences can be found in the treatment of invoice disputes and early termination clauses as follows: 1) disputes for WSPP require "payment in full including the disputed amount" versus payment of "disputed amount only" for the EEI Agreement; and 2) the early termination netting and termination payment calculations in the Event of Default must be exercised within 30 days of the Event of Default for WSPP versus the EEI Agreement which requires such termination be exercised within 20 days of written notice of Early Termination as provided by the Defaulting Party. The EEI Agreement also includes a collateralization /margining requirement that is to be negotiated between the transaction parties and contains special provisions for governmental entities. The term of this Master EEI Agreement shall commence on the effective date and shall remain in effect until terminated by either Party upon (thirty) 30 days' prior written notice, per Section 10.1 of the EEI Agreement. Riverside will impose the following deviations in the EEI Agreement: 1. Deletion of Section A of Schedule M, the "Special Fund" requirement; 2. Deletion of Section F, Section 8.4 in Schedule M with regard to Government Security; and 3. Change the choice of law provision to California law. FISCAL IMPACT There is no financial liability to Riverside by adopting the EEI Agreement as an alternate enabling agreement for power transactions. Prepared by: David Wright, Public Utilities General Manager Certified as to availability of funds: Paul C. Sundeen, Assistant City Manager /CFO/Treasurer Approved by: Belinda J. Graham, Assistant City Manager for Scott C. Barber, Interim City Manager Approved as to form: Gregory P. Priamos, City Attorney Attachments: 1. Master Power Purchase & Sale Agreement with Edison Electric Institute, Version 2.1 with the City of Riverside 2. Minutes from the Board of Public Utilities Meeting on September 16, 2011 26 -2