CHP IV Procurement

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The Ontario Power Authority (OPA) is developing a Combined Heat and Power (CHP IV) procurement to support efficient use of natural gas-fired electricity generating facilities that use CHP technology.  The goal of CHP IV is to facilitate increased development of CHP facilities greater than 20 MW in capacity that affect supply or demand in the interconnected electricity grid in Ontario by delivering firm and reliable supply to the IESO-controlled grid or a Local Distribution Company (LDC).    

The OPA has allocated a First Call Target Capacity of 200 MW for the First Call and a Second Call Target Capacity of 100 MW for the Second Call. 


Results of CHP IV Procurement

  • The OPA was encouraged by the response to the RFP for CHP IV.  Feedback received from proponents indicated they felt the process was fair, open and transparent.

    After a careful review of the proposals received, the OPA has determined that none met the necessary criteria.  No contracts will be offered at this time as a result of the CHP IV procurement.  In November, the OPA informed those proponents that registered and submitted proposals.


Aug 31, 2011 -- CHP IV RFP Addendum No. 5 

  • The CHP IV RFP has been amended to provide further clarity that Proposals must be submitted by 5:00pm EST on September 1, 2011.
  • Appendix I of the CHP IV RFP has been amended to include a reference to addenda to the RFP issuesd after July 20, 2011. 

Aug 30, 2011 -- CHP IV RFP Addendum No. 4 

  • Section 3.2.18 of the CHP IV RFP has been amended to allow Proponent's to redact pricing and other proprietary information from the documents referred to in this section.

Aug 29, 2011 -- Release of revised final CHP IV Contract

  • Due to redundancy Exhibit CC has been intentionally deleted. The Test Protocol will define the adjustment, if any, of electrical output based on less than proposed UHO being delivered during the Capacity Check Test.
    • Click here to review the CHP IV Contract.

Aug 25, 2011 -- CHP IV RFP Addendum No. 3 

  • Several amendments have been made to allow for Registered Participants or their wholly owned Special Purpose Vehicles (SPV) to be permitted to submit Proposals as Proponents. 
  • Appendix C - Proposal Form has been revised to include a field for Parent Registered Participant.

Reference the CHP IV RFP Addendum No. 3 for further clarity. 


July 29, 2011 -- Release of revised final CHP IV Contract 

The OPA has revised the following sections of the CHP IV Contract: 

  • Section 11.3(d) has been revised to provide further clarity regarding Force Majeure relief for strikes and labour disputes by employees of any Key Equipment Supplier. 
  • Section 15.7 has been revised to provide further clarity. 
  • Exhibit L has been deleted. 
  • Section references found within the Schedules have been updated. 

July 29, 2011 -- Release of CHP IV RFP Addendum No. 2

  • Definition of CHP IV RFP Heat Rate Qualification has been amended. 

July 22, 2011 -- Release of final CHP IV Contract 

An overview of the main changes to the CHP IV Contract are outlined as follows: 

  • The definition for Tranche 2 has been revised
  • Section 11.2 has been amended to provide Force Majeure relief for strikes and labour disputes by employees of any Key Equipment Supplier provided the conditions therein set out have been satisfied. 
  • Section 11.3(h) and 11.1(g) have been added to provide that the Supplier at its sole option may terminate the Agreement upon notice to the OPA and without any costs or payments of any kinds to either Party. 
  • Section 15.7 has been revised to provide further clarity. 
  • Section 16.6 and 16.7 have been revised to provide that a change of Control requires the consent of the OPA but may not occur until on or after the Commercial Operation Date. 

The OPA understands that section references in the Schedules may not be correct.  The OPA is currently reviewing and will be providing a revised copy of the CHP IV Contract that contains complete Schedules with the appropriate section references.  


July 21, 2011 -- Release of CHP IV RFP Addendum No. 1 

An overview of the enhancements are as follows:   

  • The Evaluated Cost Model has been revised to account for the Minimum Earliest Restatement Date being revised to five years following COD and for the treatment of Restatement in the evaluation (reference section 3.3.1).
  • Section 3.2.18 has been amended to clarify the requirement related to EPC Contracts and EPC Maturity Adjustment Factor. 
  • Section 3.2.19 has been amended to clarify the circumstances under which the Proposal Security may be drawn upon. 
  • Appendix C (Proposal Form), section 6 has been modified to include options for "own", "lease" and "other".  
  • The definition of Additional Services has been amended and Appendix L has been added.  
  • Appendix E (Proposal Security Letter of Credit Form) has been amended to conform with more recent forms of this document used by the OPA. 
  • To assist prospective Proponents with preparing their Proposal Package, the OPA has made available in .docx format the applicable Appendices (E,F,G,I,J), all other Appendices can be downloaded from the toolbar on the right hand side of this webpage.  The prospective Proponent remains solely responsible for ensuring that the Appendices are complete, true and accurate. Theses Appendices are provided only as an aid to prospective Proponents. 

Please reference the CHP IV RFP for the complete summary of enhancements.   


June 21, 2011 -- Release of Final CHP IV RFP and final draft CHP IV Contract

We thank all stakeholders for providing feedback on the CHP IV initiative.  We have reviewed your concerns and have incorporated several of them into the CHP IV RFP and Contract.  A summary of principles that were revised include: 

  • The Minimum Earliest Restatement Date has been revised to five years following COD.  
  • The Commercial Operation Date for the proposed Contract Facility has been revised to be no later than four (4) years after the First Call Completion Date.  
  • The First Call Proposal Submission Deadline for the CHP IV Proposal has been extended to September 1, 2011.
  • The list of Eligible Areas has been expanded.  Reference Appendix K of the CHP IV RFP or download the matrix, by clicking here
  • A presentation has been created to provide further guidance regarding the Useful Heat Output Capacity Reduction Factor, click here to view.  
  • Further clarity has been provided regarding the third party report that will need to be submitted with respect to Section 3.2.16 (d) of the CHP IV RFP.  Reference the CHP IV RFP for further details.
  • The provisions for the Further and Final Capacity Test were simplified to allow the OPA to specify the month for the test.  The contract parameters for the specified month would apply during the test.  Section 15.6 (j) of the CHP IV Contract (previously added section) has been deleted.  
  • Registration to become a Registered Participant under CHP IV has been extended until June 28, 2011 at 3:00PM EPT.

Final CHP IV RFP has been posted along with the Proposal Form (Appendix C) and Economic Bid Statement (Appendix D).  The final CHP IV RFP and draft CHP IV Contract are available for download.  Blackline copies to the latest drafts posted on June 6, 2011 are also available for download. 


The timetable with respect to the procurement process for CHP IV is set out below.  Reference Section 2.2 of the CHP IV RFP for further details.  

Procurement Activity Expected Timing
Draft CHP IV RFP and Contract release May 10 2011
Initial Question and Comment Period May 10 - June 10
Release of Revised Draft RFP and Contract  June 6 2011
Information Session June 7 2011
Release of final CHP IV RFP and final draft Contract June 21 2011
Deadline for Registration (First Call) June 28 2011
Question and Comment Period (Registered Participants Only) June 28 - July 15
Individual Information Session  July 4 - July 8
First Call Deadline for Issuing Addenda to CHP IV RFP  July 21 2011
Release of final CHP IV Contract July 29 2011
First Call Proposal Submission Deadline Sept 1 2011
First Call Completion Date: Notification to all Proponents, Announcement of Selected Proponent(s), and Execution of CHP IV contract(s) with Selected Proponent(s)

Mid-November

Limited Negotiations of Additional Services if applicable 4th Quarter
Determine and communicate need for Second Call (pending results of First Call) 4th Quarter

Notes:

  1. The OPA has established a target capacity of 300 MW for the CHP IV procurement, of which 200 MW is notionally allocated for the 1st call and 100 MW for the 2nd call.
  2. The proposal evaluation and selection process for the 1st call will be as outlined in the CHP IV RFP.
  3. The need for, and target capacity allocation of, the 2nd call may be affected by the aggregate capacity of projects selected in the 1st call.

**The dates provided above are non-binding on the OPA, and the OPA reserves the right to accelerate and postpone the dates set out above**