Section 4.3(a) of the REC contract contemplates that if a Designated System if is energized as of the Trade Date, the Seller may request that the contracting utility withhold the Collateral Requirement associated with that system from the first REC payment—thus obviating the Approved Vendor’s need to post Performance Assurance for that system. Given the Program Guidebook defines “Energized” in part as requiring completion and approval of Part II of the project application, is there a deadline applicable to an Approval Vendor’s Part II project application submittal such that Part II review and approval can occur prior to the project’s collateral due date?

For an energized project seeking to have its associated collateral withheld from its first REC payment, the Approved Vendor should submit its Part II project application at least 4 calendar weeks prior to the collateral due date (per the REC contract, collateral is due within 30 business days after the Trade Date).  This period will offer the Program Administrator sufficient time to review and verify the Part II project application in time for the Approved Vendor to formally request that collateral be withheld from the first REC payment.

If the Program Administrator determines that a timely-submitted Part II application requires more than 4 calendar weeks for review, the Program Administrator will recommend that the contracting utility extend the collateral payment deadline.  Please be aware, however, that the final decision about whether to offer an extension in time for collateral payment rests with the contracting utility.

Should an Approved Vendor submit its Part II application after 4 calendar weeks prior to the collateral due date, then it is highly unlikely that the Program Administrator will be able to review the Part II application in time for collateral to be authorized to be withheld from the first REC payment.  In such cases, given the untimely submission, the Program Administrator will not recommend that the contracting utility extend the collateral payment deadline.  Similarly, if additional information is required from the Approved Vendor to complete review of a timely-submitted Part II application, then the Program Administrator may not be able to verify the Part II project application in time for collateral withholding.  In such a case, the Program Administrator will exercise reasonable discretion in recommending an extension to the collateral payment deadline, with the final decision resting with the contracting utility as outlined above.