SPV-149: When does the IPA cash the Pre-Bid Letter of Credit? When does the IPA cash the Post-Bid Letter of Credit?

For the Supplemental Photovoltaic RFP (“SPV RFP”), a Bidder may choose to submit the bid assurance collateral and Performance Assurance collateral as either cash or a letter of credit. If the Bidder chooses to submit bid assurance collateral in the form of a letter of credit, no cash is required. The Pre-Bid Letter of Credit, posted as Appendix 6 to the RFP Rules, will only be drawn upon for cash if the Bidder fails to abide by its undertakings under the Bidder’s Proposal.  Please see paragraph 2 of the Pre-Bid Letter of Credit, which sets out that the conditions for drawing upon the Pre-Bid Letter of Credit:

a) after submission of the part 1 proposal the Seller has disclosed, publicly or to a party other than those involved in the preparation of the proposal, material information relating to the proposal; or

b) the Seller or other parties involved in the presentation of the proposal have made a material omission or misrepresentation in the part 1 proposal or the part 2 proposal submitted in connection with the Procurement Event; or

c) the Seller has failed to execute the applicable supplier contract within ten (10) business days of the bid date or has failed to provide the required deposit within fourteen (14) calendar days of the Illinois Commerce Commission approving its winning bids.

If the Pre-Bid Letter of Credit is not drawn upon, it will cancelled and returned to the issuing bank once the contract execution formalities have concluded.

Similarly, the Post-Bid Letter of Credit, posted as Appendix 2 to the SPV Contract, will only be drawn upon if the there is an Event of Default under the SPV Contract.  Such Events of Default include, but are not limited to, failing to complete the project or delivering RECs in the timeframe envisaged by the SPV Contract.  For a full description of Events of Default, please see Article 13 of the SPV Contract.

Assuming no Event of Default occurs and the systems are constructed as planned, then in accordance with Paragraph 9.2, the Post-Bid Letter of Credit will be returned with the first payment once RECs are delivered from the systems under contract.