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The DPUC will
ensure that all Bidders have access to the same information from the
DPUC and that no Bidder will have selective or otherwise preferential
access to information from the DPUC through this RFP Process.
All questions
and comments submitted by Bidders, as well as DPUC responses to such
questions will be posted here. The DPUC’s objective in posting
these questions, comments, and responses is to ensure that all Bidders
are treated in a fair and equal fashion and have equal access to
information that may be relevant for the proposals. The DPUC will not
identify the name of the party submitting the questions.
The DPUC is under no obligation to provide additional information but it may do so at its sole discretion.
Email: RFPCoordinator@Connecticut2006RFP.com with comments and questions.
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09/20/2006
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Question: When will the contracts be available? |
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Answer: The
contract templates issued in June and July 2006 are being revised
to reflect stakeholder input received over the last two months.
We will be posting the revised generation contract on the RFP
website later this week. The other contracts - for Demand Response and
Other Demand Resources, will be posted on the RFP website within
the next five to seven business days. We will be accepting bidder
comments and questions on these revised contracts through October 6,
2006 and the contracts will be finalized by the end of October 2006.
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09/20/2006
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Question: For generation resources, who gets to keep ISO ancillary services revenues.
Supplier or Buyer? |
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Answer:
We do expect the suppliers to participate in all relevant ISO-NE Markets.
However, there may be situations where the generator does not keep all ISO-NE
profits. The settlement process may require that some of the money they receive
from ISO-NE for FCM and LFRM (if elected) (and Energy, if Call Option feature is
selected) gets refunded back to the electricity distribution companies (Buyer) if the market prices in those ISO-NE
Markets exceeds the relevant Contract Price. For those suppliers that are only settling against the Forward
Capacity Market, the Supplier will be entitled to keep any additional revenue it
is able to receive for providing ancillary services. However, if the Supplier
chooses to also settle against the Locational Forward Reserve Market, which is
one type of ancillary services, then the revenues for locational forward
reserves will be allocated according to the settlement process, with the
Supplier receiving its Annual Contract Price for such services. Other ancillary
services revenue are not included explicitly in the RFP or the settlement
process in the Contract; however, the DPUC expects that bidders will take into
account the profits that they may earn in these other markets in setting their
Financial Bid for settling against the capacity market (FCM).
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09/20/2006
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Question: Are Financial Bids escalated by an inflationary index only if the regulatory
process is not completed by November 8, 2007? Or are they escalated regardless
of whether the regulatory process is completed in a timely fashion? |
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Answer: Financial Bids will only be escalated by the inflationary index if
the regulatory process is not completed by November 8, 2007. Thus, Financial
Bids submitted on December 13, 2006 must be held fixed through November 8, 2007.
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09/25/2006
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Question: The
registration form (appendix D) requests the bidder to enter a
Commercial Operation Date. Can the COD change when Technical and
Financial Bids are due? Is there any penalty for changing the COD from
registration to final bids? |
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Answer: Bidders
can update the Commercial Operation Date that they provided on their
Bidder Registration Form in their Financial Bid form if needed, though
bidders should indicate the reason for such a change. The COD date, and
other information provided on the Financial Bid Template, will be
contractually binding. |
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09/25/2006
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Question: Can
Bidders change information submitted on Appendix D: Bidder
Registration Form prior to the submission of Bidder Qualifications? |
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Answer: Bidders
can change information on Appendix D: the Bidder Registration Form in
their Financial Bid, if needed, although information such as contact
name and contact information as well as project name should remain the
same so that the DPUC can be sure that the project did indeed register
by the Bidder Registration Date. If major elements, such as project
Commercial Operation Date or Capacity, are changed between the
Registration Form submission and the Financial Bid Template submission,
bidders should provide an explanation of such change with their
Financial Bid. All information submitted on the Financial Bid
form will be contractually binding. |
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09/26/2006
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Question: Is
the Contract Quantity (MW) on Appendix D: Bidder Registration Form and
Appendix J based on Summer Capacity, Winter Capacity, or an average of
the two? |
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Answer: The
Contract Quantity is a fixed amount to be designated by the Supplier in
its Financial Bid, and will not vary by season. Bidders will have to
provide an FCM Contract Quantity, and, if they choose to also settle
against the Locational Forward Reserve Market, an LFRM Contract
Quantity. The LFRM Contract Quantity can not exceed the FCM Contract
Quantity. The FCM Contract Quantity is a fixed amount for each
Contract Year and will not vary by season. However, the Contract
Quantity in the contract may be amended from time to time based on the
results of seasonal claimed capability tests, as detailed in Section
3.2 (c) of the generation contract. |
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09/26/2006
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Question: Will a supplier's monthly capacity payments be based on different Summer Capacity and Winter Capacity levels? |
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Answer: Suppliers'
monthly capacity payments will be based on the Contract Quantity listed
for that Contract Year, although the Contract Quantities may be amended
in the contract from time to time, as per Section 3.2(c) of the
contract. |
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09/27/2006
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Question: I am having problems saving the PDF template for the Bidder Registration Form. |
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Answer: You
can only save this form with information filled in if you have
the full version of Adobe Acrobat or Adobe Business Tools. If you
only have Adobe Acrobat Reader, you will have to save the blank
template, fill it out and print it. You can then scan this print-out to
create an electronic document to email to the RFP Coordinator. |
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09/27/2006
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Question: If the sponsor of a Distributed Generation (DG) project registers as a
bidder under the RFP to reduce impact of FMCCs, and is not awarded a
contract or does not submit a bid, is the sponsor eligible to apply for
grants under section 8 (a) of the EIA? |
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Answer: DG
can bid into this RFP process and seek DG grants, but they cannot
receive both a contract through this RFP and a one-time award pursuant
to 16-243i. Thus, if a DG project that bids into this process was not
awarded a contract, it would still be eligible to seek DG grants under
the EIA.
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10/04/2006
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Question: Section
3.9 of the RFP states that a Bidder may submit up to three
Proposals for the same site. Mutually exclusive proposals will
only be required to submit one deposit, the amount of which will be
based on the largest (MW) project. If a Bidder submits a total of up to
three proposals from two separate sites, will the Bidder be required to
submit one deposit, the amount of which will be based on the largest
(MW) project, or will the Bidder be required to submit two deposits,
the amount of which will be based on the largest (MW) project for each
separate site.
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Answer: The
Bidder must submit a deposit for every proposal that is not mutually
exclusive. For projects that are mutually exclusive, the amount of the
deposit will be based on the largest (MW) project. To illustrate
how this might work, if a bidder submitted three proposals for two
different sites (A and B), and the two proposals for site A were
mutually exclusive, the Bidder would pay the deposit for the proposal
on Site B, and the deposit for the largest project on site A. If the
two proposals for site A were not mutually exclusive, however, the
Bidder would be required to pay the deposit for all three
proposals. |
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10/04/2006
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Question: Where will the Pre-Bid Conference be held and at what time?
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Answer: The
Pre-Bid Conference will take place on October 10, 2006, starting at 10
AM in Room 2C of the Legislative Office Building, 300 Capitol Avenue,
Hartford, CT. The event will likely last all day. We request that you
email the RFPCoordinator to register for the event.
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10/11/2006
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Question: Are transcripts for the Pre-bid conference available?
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Answer: Yes,
the transcript is available on the RFP website - please see the RFP Documents page at the bottom.
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10/11/2006
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Question: Is a list of participants at the Pre-Bid conference available?
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Answer: This
list is not publicly available. While participants were requested to register
with the RFP coordinator to attend the meeting, they were not required to
publicly disclose their identity at the meeting, as stated by Chairman Downes in
his introductory remarks. For information that is publicly available on the
current participants in the RFP process who have not requested a motion for a
protective order for confidentiality, you can look through the bid registrations
that are listed in Docket 05-07-14-PH02 on the DPUC’s website.
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10/13/2006
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Question:
If a bidder has not been in existence for more than two years, how
should it respond to the financial questionnaire, which asks for the
last two years of financial data?
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Answer:
In this context, the bidder should sumbit all financial data that is
available for the organization, including any other data that may help
communicate to the DPUC that the bidder has the financial wherewithal
to develop and operate the project.
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10/13/2006
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Question:
Will the Q&A from the conference be posted on the RFP website? If so, when?
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Answer:Yes,
the Q&A is being finalized and will be posted on the RFP website
early the week of October 16th. In the meantime, we have also posted
the PowerPoint presention and the transcript from the Pre-Bid
Conference on the RFP website.
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10/17/2006
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Question:
Section 3.4 of the RFP states that “Bidder registration is
required in order to participate in the RFP. The deadline for bidder
registration is September 29, 2006 (the Bidder Registration Date). The
Bidder Registration Form … should be completed and submitted to
the RFP Coordinator by the Bidder Registration Date …” We
note that a number of developers have attempted to register projects
after the Bidder Registration deadline. What is the status of
those untimely projects vis-à-vis those developers who complied
with the rules and filed their registrations on time?
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Answer: The September 29th deadline was firm and that has been communicated to anyone that has tried to register after that date.
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10/17/2006
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Question:
The RFP bid evaluation process will consider the benefits of each
project based on cost reductions to Connecticut Load (Interim Decision,
page 15).
The evaluation of the energy benefits of Demand Resources would need to be
considered as part of that calculation. Demand Resources have varying
energy savings based on the length of time the demand is reduced, typically
referred to as hours of use. The range of variation can be a few hours on
a single day to several thousand hours per year. Since there is
currently no requirement for hours of use to be submitted as part of
the RFP submission, how will the energy benefit of various Demand
Resources be calculated?
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Answer:
We are currently revising the project description templates and the
revised versions will incorporate this additional information. We will
be posting the revised versions on the RFP website later this week.
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10/17/2006
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Question:
With regard to section 2.5(e) of the Generation Contract: that
damages set out in Sections 2.5(a) and 2.5(b) will not apply if the
delay is due to (i) a Force Majeure event; (ii) a material breach by
the Buyer of its obligations under this Agreement, pursuant to Article
4; or (iii) a delay in obtaining regulatory approval from the
Department of Environmental Protection or the Connecticut Siting
Council (or any other relevant Government Agency), which was not caused
by the Supplier or by the Supplier’s failure to perform a
required task, I request clarification of this provision in the context
of remarks from the DPUC that, in effect, permitting is
the risk of the Supplier. In the following three scenarios, what
happens in the case that a Supplier misses a Milestone Date: (1) Assume
that a Project seeks a discretionary special permit or a variance from
local zoning requirements, and that relief is denied, not just delayed
or conditioned. The Supplier can take no action to obtain the relief;
(2) Assume that a Project requests an Interconnection from the
Independent System Operator, and the required upgrades or operating
restrictions are prohibitively expensive. (3) Assume that a Project's
relevant applications to the Connecticut Siting Board or the Department
of Environmental Protection for an Air Permit are denied. (4) Assume
that any of the above applications granted but appealed.Are full
damages due, or are these cases where the "delay" is not caused by the
Supplier? Does "delay" include "denial"?
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Answer:
In cases 1 through 3 outlined above, the Supplier would be responsible
for the delay and/or the denials. On the question of appeal (case 4 outlined above), and
as long as the appeal is not the fault of the Supplier, an appeal
should not result in delay unless there is a stay.
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10/17/2006
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Question:
We have a few questions regarding Connecticut licensing requirements
and what might be applicable with respect to projects implemented via
the RFP. 1. Is a Connecticut general contractor's license required
for demand resource work?
1b. If so, must the license be obtained prior to making a bid, or
rather prior to performing any work under the program? 2. Are there any
other specialty licenses required for this type of work?
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Anwer:
Developers and their subcontractors must have the requisite skills to
develop and operate their projects and must follow the laws of the
State of Connecticut including obtaining any licences that are required. It
is up to Bidders to determine which licenses - and other qualifications
- are needed and to comply with these requirements. Bidders
do not have to submit such licenses in the RFP though possession of
them would clearly demonstrate the technical wherewithall of the
Bidder.
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10/19/2006
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Question: Could
you provide us with feedback on what we can expect values for Demand Response
resources will be?
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Answer: The
DPUC will not be releasing any specific pricing benchmarks for
potential bidders as this would conflict with the intended competitive
nature of the procurement process. Bidders should in developing
Financial Bids for this process consider what compensation they require
for the project over the anticipated term of the contract, given other
possible revenue sources that exist for the project. For additional
input into Bidder reflections on this topic, we recommend that bidders
review ISO-NE’s Settlement Agreement filed with FERC, which
provides an indication of ISO-NE’s expectations regarding pricing
expectations for the FCM and describes in details the FCM pricing
rules.
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10/19/2006
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Question:
Section 2.6 (g) a. i. of the Master
Agreement for Generation Projects states that “The equivalent required for
maintaining operations at the facility’s annual load factor for a minimum of
(5) calendar days unless the Facility’s annual load factor, as defined by the
Target availability listed in Exhibit C, is less than 15%.”
1) Is the annual load factor the same
as the Facility’s annual capacity factor? That is actual MWH produced divided
by the plants nameplate capacity times annual
hours.
2) How will the annual load factor be
determined for the Facility’s first year of operation? An estimate by the
Supplier?
3) How will the annual load factor be
determined for the Facility’s subsequent years of operation? Based on prior
years actual results, or an average of several previous
years?
4) Why
is the annual load factor defined by the Target Availability? A
project
could have 100% Availability yet not run at all
during a year due to market
economics.
5) Assuming a five day supply is
required for purposes of this provision,
how quickly does the alternative fuel need
to be replaced in the event
the initial five day supply is consumed.?
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Answer:
(1) The load factor is the same as the annual capacity factor. (2) The
annual load factor in a Facility's first year of operation should be
based on the average load factor of all other New England units with a
similar technology and heat rate in the previous year. (3) Once the
Facility has started commercial operation, its load factor for purposes
of 2.6 (g) will be determined by its load factor the previous year. (4)
We will be editing this provision in the contract in the next round to
reflect theses comments and will eliminate any references to target
availability in Section 2.6 (g). (5) If some or all of the required
fuel supply is consumed, the supplier must replace that supply within
five Business Days.
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10/20/2006
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Question: Have the proposal security requirements been amended in light of bidder comments?
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Answer:
Yes, the DPUC has amended the structure of the Project Security
Deposit requirements based on stakeholder comments. The revised
security requirements for the proposal process are listed below.
On December 13, 2006, when bidders submit their Financial Bid, bidders
with a generation project will be required to post $10/kW and bidders
with a Demand Resource project will be required to post $2/kW.
This Project Security Deposit must be provided in cash or through
a Letter of Credit. Bidders will not be allowed to net this security
requirement with any security provided to ISO-NE.
On the day that winning bidders are contacted by the DPUC (no later
than April 23, 2007), winning bidders must post an additional security
(again in the form of cash or a Letter of Credit) such that winning
bidders with a generation project post a total of $25/kW and winning
bidders with a Demand Resource project post a total of $5/kW for the
Project Security Deposit.
On the date that the contracts are approved by the DPUC (the Effective
Date of the contract), bidders will be required to increase or replace
the Project Security Deposit such that Suppliers with a generation
project post $100/kW and Suppliers with a Demand Resource project
post $35/kW for their Completion and Performance Security until
the project reaches Commercial Operation. The Completion and
Performance Security can be established in the form of cash, a Letter
of Credit, or a performance bond that meets the requirements in the
Master Agreements. The Completion and Performance Security
can be netted against any security provided to ISO-NE, as long as such
security is not in the form of guarantees. After Commercial Operation,
the Completion and Performance Security decreases to $25/kW for
generation and $15/kW for Demand Resources for the remaining Term of
the Agreement.
All entities posting their security requirements in the form of cash
will be paid
the interest that accrued on their deposit from the date it was
provided until the date it was returned on the date the security is
returned to
them. For entities posting an incremental amount of security, the
accrued interest can be added to the
existing security, effectively decreasing the
incremental amount that must be posted.
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10/25/2006
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Question: We had some questions
about the motion for a protective order. Should we submit this filing before or
with the Qualifications Submission? Also, is it sufficient to just submit the
motion in order to receive confidential treatment, or is there an approval
process? Please explain.
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Answer:
A bidder must
file a motion for protective order, a protective order and an affidavit in
support of the protective order from an appropriate employee or agent
of the company seeking protected treatment. The motion should explain
why the material should be exempt from public disclosure under CT's Freedom of Information law. The information the
bidder seeks to protect should be filed under seal and each page labeled confidential protected
material. The information will not be disclosed publicly pending a ruling on
the motion. If the bidder only seeks to protect
a portion of their filing, they should file a public version with redactions to
protect the material they seek to protect along with the version under seal that
contains the protected material. If the motion is granted, the
material will be protected. If the motion is denied, the bidder will receive a
letter directing the bidder to come retrieve the material they sought to
protect. The bidder can also request that the DPUC destroy any
materials if protected treatment is not granted. The DPUC website under the
link for Filer Instructions has a link providing basic information about how to
seek protected treatment of information filed with the DPUC. Bidders can go on
the Active Docket link to the DPUC website and Search "protective order" to
locate templates of the standard motion for protective order and accompanying
documents that have been approved by the DPUC in recent
dockets.
We would also direct bidders with questions about this to carefully review Section 3.3 of the RFP
that describes the process for seeking protected treatment as well as the DPUC's
expectations about what types of material the DPUC wishes to ultimately disclose
about each selected project.
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| 10/31/06 |
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Question:
Your response in the Pre Bid Conference Q&A – the Answer to
Question 2.2 states – any projects that receive other ratepayer
funding that covers 100% of a project’s development costs,
including but not limited to the Conservation and Load Management Fund,
Project 100 (and the renewable contracts), Clean Energy Fund and the
various DG programs authorized though the EIA (such as DG capital
grants….will not be eligible for funding for any capacity that
was already funded. (1) What is meant by 100% of a
project’s development cost? (2) If project’s
development cost is very broadly defined, can an exception be made for
the following specific case? Assuming in a the specific case that
a recipient of a DG grant for customer-side distributed generation is
funded to take their electrical load off the grid and to self generate,
why should the recipient be penalized if it decides to enter into the
FMCC reduction RFP by load shedding its internal load and making its
self-generation available to the grid? The CT ratepayers will
receive a double benefit when (i) the recipient’s load is off the
grid through the DG grant program and then (ii) making available very
low cost power to the Grid through the FMCC reduction RFP. By
permitting the recipient’s participation in the FMCC Reduction
RFP, you are accessing the potential pool of low cost power available
to bid for the benefit of the CT ratepayer for which this program was
intended. The payment under the FMCC reduction program can be viewed in
this case as an incentive to the recipient to load shed and provide low
cost power to the grid since the FMCC reduction RFP payment would be in
an amount to offset the opportunity cost associated with the load
shedding.
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Answer:
(1) The project's development costs refers to the full cost of
developing and constructing the facility. (2) Projects that received
any funding from the conservation fund, DG grants,
and/or Project 100 are not eligible to participate in this
procurement process. |
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10/31/2006
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Question: Do
the liquidated damage provisions in Sections 2.5(b), 2.5(c), 3.2 (c),
3.3(e).b. and 3.3(f).b. of the Demand Resource Contract apply to demand
response projects? If your answer to any of these questions is
“yes,” please explain why each such liquidated damages
provision applies to a demand response project.
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Answer: Yes, all of these liquidated damages provisions could apply to a demand resource project.
Section
2.5(b) is applicable as the determination to award a contract to the
demand resource project will have been based on the project’s COD
(or CODs if the project capacity is coming on line in a staggered
manner).as warranted in the proposal. As such, the Supplier must
pay liquidated damages to compensate the Buyer (and indirectly CT
ratepayers) for not meeting its warranted online date. The CT
ratepayers will forego anticipated financial benefits from having that
capacity in place if the warranted milestone is not met.
Therefore, the liquidated damages are meant to compensate for the
replacement costs for that capacity.
The
logic for Section 2.5(c) is similar: the Buyer was promised a fixed
number of MW in the proposal. If the Supplier is unable to deliver this
amount of MW, then the Supplier must compensate the Buyer for its
deficiency in order to make up for the present value of the replacement
costs for that capacity until new demand resources can come online. The
same logic holds for Sections 3.3(e)b and 3.3 (f) b. The DPUC wants the
Supplier to submit Contract Quantity levels that it can commit to for
the life of the contract.
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| 10/31/06 |
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Question: With
respect to the definitions of “Commercial Operation” and
“Commercial Operation Date” in Article 1 of the Demand
Resource Contract, (i) is there a Commercial Operation Date for a
demand response project; and (ii) if your answer to the question in
subsection (i) above is “yes”, then please identify which
of the Milestones for Commercial Operation in Section 2.5 applies to a
demand response project and which of the requirements for Commercial
Operation in Section 2.6 applies to a demand response project?
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Answer:
Yes, the demand resource project must submit a date-certain Commercial
Operation Date. This COD can vary by “batch,” effectively
allowing the aggregate capacity for the demand resource project to come
on-line in a staggered manner.
The demand resource project must meet all milestones listed in Section
2.5, however liquidated damages will only be incurred for missing the
Commercial Operation Date under the Master Agreement for Demand
Resources.
All requirements for commercial operation listed in Section 2.6 are
applicable for demand resources projects, though some provisions may
not apply to all Demand Resources.
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| 10/31/06 |
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Question: If
LEI and the Department conclude that Section 2.5(b) of the Demand
Resource Contract applies to demand response projects, is
“Commercial Operation” within the meaning of Section 2.5(b)
an event that will occur once for a demand response project (e.g., the
date upon which the Supplier first signs-up all of the necessary MWs of
Demand Reduction Value in an amount equal to the Supplier’s Base
Level FCM Contract Quantity and/or Base Level LFRM Contract Quantity,
as appropriate), or could a demand response project be subject to the
liquidated damages in Section 2.5(b) if, at any time during the term of
the Demand Resource Contract, its Demand Reduction Value falls below
the Base Level FCM Contract Quantity and/or Base Level LFRM Contract
Quantity, as appropriate, for any reason?
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Answer:Section
2.5 (b) is intended to apply only when a project first reaches
Commercial Operation. In the context of a demand resource project that
is coming online in a staggered manner, that has scheduled several
different CODs for different “batches” of capacity, Section
2.5(b) would apply one time to each batch until that batch of capacity
achieves commercial operation.
Deficiencies in capacity after commercial operation are governed by Sections 2.5 (e) and 2.5 (f).
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| 10/31/06 |
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Question:
If LEI and the Department conclude that Section 2.5(c) of the Demand
Resource Contract applies to demand response projects, is the
liquidated damage provision of $200 per kW in Section 2.5(c) assessed
to the Supplier on a one-time basis (or until a cure is achieved) if,
upon the Commercial Operation Date, the Supplier’s Demand
Reduction Value is less than the Original Base Level FCM Contract
Quantity (and if relevant its Original Base Level LFRM Contract
Quantity)?
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Answer:
The liquidated damage of $200/kW is indeed a one-time assessment
at the time the project reaches its Commercial Operation Date. Again
if a demand resource is coming on-line in a staggered manner, with a
set of different CODs for different “batches” of capacity,
section 2.5 (c) would apply one time to each batch. The $200/kW
figure, as discussed above, represents the present value of replacement
costs that can be anticipated today for deficient capacity until such
time as “new” demand resources can enter the market to
replace the deficiency (it typically takes 1-3 years for new demand
resources to be implemented).
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| 10/31/06 |
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Question: If
LEI and the Department conclude that Section 3.2(c) of the Demand
Resource Contract applies to demand response projects, does the
liquidated damages provision in Section 3.2(c) apply only if the
Supplier is unable to participate in the applicable ISO-NE Market(s)
due to “the termination of its membership (or the membership of
its agent), or suspension of membership rights or termination of its
Market Participants Service Agreement” pursuant of Section
8.1(b).b of the Demand Resource Contract and if such failure to
participate was not caused by an event of Force Majeure? Or does
this liquidated damage provision in Section 3.2(c) apply if the
Supplier is unable to participate in the applicable ISO-NE Market(s)
for any reason, including but not limited to the reasons set forth in
Section 8.1(b).b of the Demand Resource Contract, as long as such
failure to participate in the ISO-NE Market(s) was not caused by an
event of Force Majeure?
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Answer:
We have clarified the language in Section 3.2(c) of both Master
Agreements to better reflect our intention that the liquidated damage
in this provision was to compensate the Buyer for any circumstances for
which the Supplier is unable to participate in the ISO-NE Markets
(except those caused by Force Majeure) until a cure is achieved.
If there is a legitimate Force Majeure, no liquidated damages are due.
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| 10/31/06 |
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Question: If
LEI and the Department conclude that Sections 3.3(e).b and 3.3(f).b
apply to demand response projects, if the demand response
project’s Demand Reduction Value falls below the Base Level FCM
Contract Quantity and/or Base Level LFRM Contract Quantity, as
appropriate, by more than 2% and if such deficiency is not cured on the
46th day, is the Supplier automatically entitled to have its Base Level
FCM Contract Quantity reduced by the appropriate corresponding amount
via a Contract addendum, or is the scope and degree of such reduction
to the Base Level FCM Contract Quantity subject to prior Department
approval and/or Department discretion?
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Answer:
Once the 46th day has passed, the Base Level FCM (or LFRM) Base Level
Contract Quantity would be automatically reduced by a corresponding
amount such that the revised Base Level FCM/LFRM Contract Quantity is
equal to the project’s Demand Reduction Value, as demonstrated in
accordance with ISO-NE procedures and/or the Measurement and
Verification Plan. The Department does not have any role in
approving or denying or altering the amendment of the Contract Quantity
in this context.
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| 10/31/06 |
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Question:
Assuming arguendo that a demand response bid to provide 30 MWs of Base
Level FCM Contract Quantity over a Demand Resource Contract term of 5
years is approved by the Department, what measure of liquidated damages
would this winning bidder be exposed to under the following
circumstances: (1) the Demand Reduction Value of the demand
response project is 20 MWs on the Milestone for the Commercial
Operation Date; (2) the Demand Reduction Value of the demand response
project is 20 MWs 22 days after the Milestone for the Commercial
Operation Date; (3) the Demand Reduction Value of the demand response
project is 20 MWs 46 days after the Milestone for the Commercial
Operation Date; (4)the Demand Reduction Value of the demand response
project is 20 MWs one year after the Milestone for the Commercial
Operation Date; (5) the Demand Reduction Value of the demand
response project is 30 MWs, but only 20 MWs is eligible to participate
in the applicable ISO-NE Markets due to a Market Change; (6)the Demand
Reduction Value of the demand response project is 30 MWs, but only 20
MWs is eligible to participate in the applicable ISO-NE Markets due to
an ISO-initiated change to an ISO-NE document other than a Market
Change; (7) the Demand Reduction Value of the demand response
project is 30 MWs, but only 20 MWs is eligible to participate in the
applicable ISO-NE Markets due to an event other than a Market Change
and other than an event of Force Majeure; (8) the Demand Reduction
Value of the demand response project is 0 MWs on the Milestone for the
Commercial Operation Date and, six months later this deficiency has not
been cured and the Demand Reduction Value has not increased at all.
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Answer: NOTE THAT ANSWERS TO THIS QUESTION REFLECT CERTAIN REVISIONS TO CONTRACTS THAT WILL BE ISSUED BY NOV. 1, 2006.
(1) If this is all the project can deliver (after the 30 calendar day
cure), the project would then owe liquidated damages of $200/kW for
each MW of deficient capacity (namely, 30 MW from Proposal – 20
MW made available at COD = 10 MW). Once the liquidated damage is
paid ($200/kW * 10 MW = $2,000,000), then the Parties would prepare an
Addendum to the Agreement and reset the Base Level FCM Contract
Quantity at 20 MW for the Term of the Agreement. The Supplier,
from that point on, would be responsible for the operation and
performance of only 20 MW of demand resources. If the project is
just late coming online with the remaining amount, the project would
owe liquidated damages of $50/MW/calendar day until the full amount is
ready for commercial operation.
(2) The liquidated damages for being 22 days late is equal to the Base
Level FCM Contract Quantity of 30 MW * days late (22) * $50/MW and thus
equals $33,000.
If 20 MW is all the project can deliver (after the 30 calendar day
cure), the project would then owe liquidated damages of $200/kW for
each MW of deficient capacity and could effectively reset the Base
Level FCM Contract Quantity at 20 MW for the term of the Agreement.
Thus, in this context, the LDs for insufficient capacity would be equal
to $2 million. Total LDs in this context would be equal to $2,033,000.
(3) The liquidated damages for being 46 days late is equal to the Base
Level FCM Contract Quantity of 30 MW * days late (46) * $50/MW and thus
equals $69,000.
If 20 MW is all the project can deliver (after the 30 calendar day
cure), the project would then owe liquidated damages of $200/kW for
each MW of deficient capacity and could effectively reset the Base
Level FCM Contract Quantity at 20 MW for the term of the Agreement.
Thus, in this context, the LDs for insufficient capacity would be equal
to $2 million. Total LDs in this context would be equal to $2,069,000.
(4) If 20 MW is all the project can deliver (after the 30 calendar day
cure), the project would then owe liquidated damages of $200/kW for
each MW of deficient capacity and could effectively reset the Base
Level FCM Contract Quantity at 20 MW for the term of the Agreement.
Thus, in this context, the LDs for insufficient capacity would be equal
to $2 million. Note that this LD would be payable once the 30 day cure
has expired – not one year later as per the question.
(5) No liquidated damages would be due in this case pursuant to Article
3.3 (d). The Supplier and the Buyer would amend the contract such that
the Base Level FCM Contract Quantity was reset to 20 MW.
(6) As described, this sounds as though it would qualify as a Market
Change, according to the definition in the Agreements. As such, no
liquidated damages would be due in this case pursuant to Article 3.3
(d). The Supplier and the Buyer would amend the contract such that the
Base Level FCM Contract Quantity was reset to 20 MW.
(7) If 20 MW is all the project can deliver (after the 30 calendar day
cure), the project would then owe liquidated damages of $200/kW for
each MW of deficient capacity and could effectively reset the Base
Level FCM Contract Quantity at 20 MW for the term of the Agreement.
Thus, in this context, the LDs for insufficient capacity would be equal
to $2 million.
(8) Missing the COD is an Event of Default with a 90 calendar day cure.
Thus, the Supplier would incure liquidated damages equal to $135,000
and then be liable for the Early Termination Payment.
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| 10/31/06 |
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Question:
The pre-bid Q&A said there would be a place to submit heat rate
curves as part of the Qualifications submission. Can you point us
to where that is located?
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Answer:
On Sheet H1-C of the Generation Project Description Template, the
instructions state that if the bidder has additional information
regarding a facility’s heat rate, including any production
output-heat rate curves, that that information should be submitted in
addition to the information requested in Form H1-C. Thus, this
information should be submitted separately, clearly labeling what it
is.
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| 10/31/06 |
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Question:
Order number one in Docket 05-07-14PHI required Connecticut’s
electric distribution companies to assist vendors in achieving their
contractual
obligation for supplying resources to ISO-NE in response to ISO’s GAP RFP.
What assistance should vendors expect to receive from the electric
distribution companies in fulfilling their obligation under this RFP.
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Answer:
Section 4.3 of the Master Agreements lays out the Buyer’s
obligations under this Agreement, although section 2.6 (i) of the
Master Agreement for Demand Resources and Section 2.6 (h) of the Master
Agreement for Generation also require the Buyer to provide commercially
reasonable assistance in the Supplier’s efforts to attain
Commercial Operation. Outside of these basic contractual obligations,
Suppliers should not expect any other major assistance from the EDCs
(i.e., bill inserts or advertising).
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| 10/31/06 |
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Question: The RFP requires bidders to disclose funding already received for their
projects. Would projects selected through the RFP be eligible for capital
awards under 05-07-17 in the future? Would projects selected be eligible
to receive funding from the Conservation and Load Management fund
administered by the electric distribution company? Would projects be
eligible to receive funding from the Connecticut Clean Energy Fund?
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Answer:
As stated in Section 3.6 (d) of the revised Master Agreement for Demand
Resources and Section 3.5 (d) of the revised Master Agreement for
Generation (both issued Nov.1, 2006), the Supplier must notify the
Buyer and the DPUC 30 calendar days before it would receive any
Additional Ratepayer Funding. Such Additional Ratepayer Funding
includes but is not limited to the Conservation & Load Management
Fund, the Connecticut Clean Energy Fund, and any other funding
authorized under the EIA (except for this RFP process). The DPUC
shall instruct the Buyer to reduce payments to the Supplier by an
amount equal to the Additional Ratepayer Funding such that the total
ratepayer funding for the Facility does not exceed the total amount
payable to the Supplier anticipated under this Agreement.
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| 10/31/06 |
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Question:
The RFP requires bidders to disclose public funding they have received
for their projects as part of the bid package. Are resources that
have
received capital awards as authorized in Docket 05-07-17 eligible to
receive any awards under this RFP?
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Answer:
No. Per the capacity procurement provision, Conn. Gen. Stat. Section
16-243m(g), anyone recieving a DG grant per Section 16-243i is not
eligible for a capacity contract under Section 16-243m.
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11/07/2006
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Question: Since
combustion turbines aren’t allowed to run below 50% of their
maximum capacity for environmental reasons, must bidders enter a value
of 0 (zero) in the response for “heat rate at 50% capacity”
on technical template form H1-C Heat Rate Information?
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Answer: The
DPUC is collecting partial load heat rate data to allow it to model the
cost vs. output and efficiency of proposed generators. The form
H1-C “Heat Rate Information” has been amended to eliminate
a minimum stipulated output level of 50%. Bidders are encouraged
to provide Heat Rate and output data for generators at 1) the lowest
stable operating point, 2) at a point roughly midway between the lowest
stable point and full load, 3) at full load and 4) at full load with
power augmentation in operation (if applicable), to the extent
stipulated percentage values on form H1-C do not achieve the foregoing
objective for the particular generator proposed.
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11/07/2006
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Question: If a bidder is proposing 3 separate scenarios at the same generating
site, is he or she required to submit a completely separate qualification
submission for each scenario or can they be packaged together in one
qualification submission.?
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Answer: The
DPUC would prefer that a separate qualification submission be made for
each proposed project/scenario so that there are no mistakes about
which qualifications are for which projects/scenarios. If bidders are
submitting multiple project proposals, and hence multiple
qualifications submissions, the DPUC requests that the qualifications
submissions for each project/scenario be clearly labeled and sent as
separate emails/packages.
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11/07/2006
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Question: Question regarding the relative humidity conditions specified for the
summer and winter inlet temperatures: Gas turbine manufacturers typically
provide the winter and summer performance data with a standard relative
humidity value of 60% as the ambient humidity. The gas turbine inlet
temperature is the most influential value on the performance of the gas
turbine, secondly barometric pressure, thirdly relative humidity.
Relative humidity has a very minor affect on the performance of the gas
turbine unless inlet fogging is added to the gas turbine. Will the DPUC
accept the performance data for winter and summer inlet temperatures as
specified on Form H1-C using the standard relative humidity value of 60% as
the performance data for the turbine is readily available from the turbine
manufacturers?
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Answer:
The DPUC is no longer requiring the use of specific humidity conditions
(see the 10/25 Project Description Template on the RFP website) for the
Qualifications Submissions. Rather, the DPUC has stated that bidders
should comply with all ISO-NE guidelines regarding assumed atmospheric
and humidity conditions, and in the absence of such guidelines use
generally accepted industry practice.
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11/07/2006
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Question: It
seems that questions 6-16 on worksheet “Form H2-B Technical
Description” do not apply to real-time demand response resources.
Can you confirm this?
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Answer: The
intent of questions #6-16 on Form H2-B of the Demand Resource
Project Description Template is to collect information regarding the
operating profile of the capacity. If the DR project utilizes a
form of electric generation, we would like to know what the bidder can
tell us about how the capacity will operate, how quickly it comes on
line, whether there is ramping or load following capability, etc.
If the DR project is an instantaneous load curtailment, those questions
therefore would not apply. If on the other hand, the DR mechanism
is an “emergency” generator, then we would like bidders to
answer the questions as best they can.
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11/09/2006
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Question: Page 11 of 92 of the subject RFP states: The DPUC will also accept bids
from refurbished or re-powered capacity as long as all of the following
conditions are met: the aggregate summer demonstrated capacity on the facility site
increases; the original unit being refurbished or re-powered is at least 30 years
old; new investment at a pre-existing site electrically located in the state
of Connecticut results in an increase in output greater than 20% of the
site's demonstrated summer capacity, or 40 MW, whichever
is greater; If a pre-existing site can support the installation of a
new 47 MW Combustion Turbine and the upgrade of an existing 43 Mw Hydro
Plant to 53 MW, would the developer obtain full credit for the 47 Mw
Combustion Turbine and the 53 Mw Hydro Upgrade.
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Answer: Section
2.1 of the RFP states that the DPUC will accept bids for the entire
capacity of a refurbishment proposal as long as all of the following
conditions are met: 1) the aggregate summer capacity increases; 2) the
original unit being refurbished is at least 30 years old; 3) the new
investments result in an increase in output that is greater than 20% of
the site’s demonstrated summer capacity or 40 MW, whichever is
greater; and 4) the bidder will commit to the number of years that they
will maintain a net increase in capacity at the site. If the bidder
does not meet all of these conditions, the bidder would only be able to
bid the incremental capacity into this RFP process.
Based on the description provided above, the project appears to
meet all of 4 conditions (assuming that the original unit is at least
30 years old and that the bidder will commit to a number of years of
maintaining the new total capacity). As such, the bidder of such a
project could bid the new 47 MW Combustion Turbine project with the 10
MW upgrade of the hydroelectric facility on the same site as an
aggregate 53 MW + 47 MW = 100 MW facility.
Note however that the DPUC will evaluate proposals for refurbished
capacity in the following manner, as stated in Section 2.1 of the RFP
on p. 11: the DPUC will consider the full cost of the amount of
capacity that is bid into the RFP process for the entire term of the
contract. On the benefits side, however, the DPUC’s going forward
assumption is that there will be no asset retirements or refurbishments
in Connecticut until 2010. Thus, the project’s estimated benefits
in the bid evaluation will only reflect the value of the incremental
change in capacity in the near term (until 2010).
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11/09/2006
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Question: Regarding the qualification submission, I understand 3.6 of the RFP to
specify that the electronic copies of the submission are due to LE and
DPUC on Monday by 5pm EST, with a hard copy to DPUC to follow. Does
that mean the hard copy can arrive to DPUC on Tuesday morning?
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Answer: Yes, this is acceptable as long as the electronic copies arrive by 5 PM on Monday November 13, 2006 by 5 PM.
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11/09/2006
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Question: Exhibit
H requests supporting documentation if the project meets Connecticut
LSR requirements. Can you give us example of supporting documention
that would suffice?
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Answer: The
bidder should submit documentation from ISO-NE or an independent
engineer attesting to the fact that the facility will be electrically
located in Connecticut. For Demand Resource Projects, such
documentation such state that the project is physically located in
Connecticut.
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11/09/2006
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Question: We
are building one plant and are considering making three alternative
bids, either different price paths or different contract durations, or
a combination of the two. The material in the Submission Package does
not change regardless of which bid(s) we propose. In other words, the
identical Submission Package would support any or all of the bids.
As we prepare our filings for Friday (in order to reach you on Monday),
it seems wasteful to duplicate identical Qualification Submission
packages, particularly where we have bulk materials and confidential
materials requiring special handling (e.g., labeling and sealed
envelopes, etc.). In fact, other than labeling the packages A, B, and
C, there would be no way to distinguish one package from the other.
Moreover, we are concerned that such duplicate submission would
contribute to a data overload and actually confuse things.
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Answer: The
DPUC is evaluating each proposal on its own merits and as such needs to
evaluate the qualification submission of each proposal individually. We
do not want to miss any nuances to the specific qualifications that a
bidder may be highlighting for a given specific project. We believe
that the additional administrative effort on both ends will be worth
avoiding any confusion during the qualifications assessment process. As such, we request that bidders submit qualifications submission for each proposal they have.
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11/09/2006
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Question: How do I submit a request for a delay in the Financial Bid Deadline?
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Answer: To
request a delay in the Financial Bid deadline, you can submit a letter
with this request to the DPUC within Docket No. 05-07-14PH02, which
will be considered by the DPUC in its deliberations on this issue.
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11/09/2006
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Question: Can we make amendments to the Milestone dates that we provide in the Qualification Submission later in the Financial Bid.
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Answer: Yes, if need be, you can amend the milestone dates in the Financial Bid, which will contain the contractually binding dates.
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11/17/2006
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Question:Did “Company ABC” file its Bidder Registration statement on or before September 29, 2006?
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Answer: As
noted in previous Q&A, the DPUC is not releasing an official list
of registered bidders, nor is the DPUC publicly releasing a list of
entities that qualified pursuant to the November 13, 2006
qualifications submission process. Rest assured that the DPUC and the
RFP Coordinator have carefully monitored and documented the timeliness
of submissions. Each Bidder has received a confirmation regarding its
registration and its qualification submission, if these were submitted
in a timely fashion. Any entity that did not receive a receipt
confirmation for its Qualification submission from the RFP Coordinator
is not qualified to submit a Financial Bid on December 13, 2006.
The RFP Coordinator will be contacting those entities that submitted
Qualification packages with their qualification status on or about
December 1, 2006.
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