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Q1) Is the provision of installed capacity (as opposed to operating capacity) a requirement?

A) Each bidder should accurately describe the expected availability based on historical operations, performance and maintenance. The final contract will address how specific situations, such as forced outages, are handled.

Q2) Are contingent proposals acceptable? For example, a feasibility study for a firm path will take longer than the time between now and the bid deadline.

A) Yes.

Q3) Is it a requirement that the energy sale and purchase is physical? Would Duke consider a financially settled energy product?

A) Yes, it is a requirement that the energy sale and purchase is physical. Duke will not consider financially settled energy products.

Q4) The RFP for Duke Energy Carolina’s Capacity Needs for 2015-2017 states the following:
“DEC will not accept proposals for projects on DEC property, the purchase of new or existing energy facilities, energy efficiency, DSM or baseload proposals.”
Does this mean that Duke Energy will not consider proposals for Demand Response based solutions that are structured as a Power Purchase Agreement (PPA)?

A) Duke will not consider proposals for Demand Response based solutions that are structured as a PPA. Please reference Section 2 in the RFP; “DEC will not accept proposals for projects on DEC property, the purchase of new or existing energy facilities, energy efficiency, DSM or baseload proposals.”

Q5) On page 3 of the RFP it is stated that “Respondents must deliver capacity and energy for a minimum of one year on the dates between January 1, 2015 to December 31, 2017.” Must capacity and energy have to be available for a 12 continuous months or cumulative over the 3 year period totaling 12 months (breaks in availability)?

A) Capacity and energy have to be available for 12 continuous months.

Q6) Will DEC accept bids of system capacity and energy as opposed to unit specific products, so long as the product is capacity and energy in the form of a dispatchable contract?

A) DEC will not accept bids of system capacity & energy. Please reference Section 2 (F) in the RFP; “Proposal must identify the generation resources that have been proposed and their location.”

Q7) Will Duke consider a tolling arrangement for fuel?

A) Yes.

Q8) With regard to “Respondents must deliver capacity and energy for a minimum of one year on dates between January 1, 2015 to December 31, 2017. Consideration will also be given for proposals that start prior to January 1, 2015.” Will consideration be given to longer (additional years beyond 2017) delivery term?

A) No

Q9) What are the operational details with respect to dispatch? Will DEC submit day-ahead, 16-hour schedules? Is there a minimum run?

A) DEC will submit day-ahead and intra-day schedules following the standard protocol for the relevant balancing authority. DEC values flexibility, however, the minimum run time is determined by the bidder.

Q10) What is DEC’s expectation with respect to availability – i.e., what are the consequences of not meeting a dispatch schedule due to a forced outage?

A) Although specific forced outages and minimum performance levels will be specifically addressed in the customer/Duke contract, reasonable forced outages will be deemed acceptable.

Q11) One of the answers to an FAQ states that “capacity and energy have to be available for 12 continuous months,” meaning that maintenance outages are not acceptable?

A) That was not the intent of the statement. Typical maintenance outages are acceptable.

Q12) Will there be the ability to provide replacement energy in the event of a forced or planned outage?

A) Although specific forced outages and minimum performance levels will be specifically addressed in the customer/Duke contract, reasonable forced outages will be deemed acceptable.

Q13) What is the desired delivery point?

A) Capacity and energy from the generation resources must be delivered to DEC’s transmission system.

Q14) Will preference be given to resources connected to the DEC transmission system?

A) Preference would be given to a resource connected to the DEC transmission system (relative to a resource located external to the DEC transmission system) only if the latter presented a material deliverability risk.

Q15) Will preference be given to resources located in the DEC service area?

A) Preference would be given to a resource located in the DEC service area (relative to a resource located external to the DEC service area) only if the latter presented a material deliverability risk.

Q16) Will preference be given to resources located in North Carolina or South Carolina?

A) Preference would be given to a resource located in North Carolina or South Carolina (relative to a resource located in a different state) only if the latter presented a material deliverability risk.

Q17) What types of resources (wind, biomass, waste heat recovery, hydro, etc.) are considered to be renewable resources?

A) Referring to Session Law 2007-397, Senate Bill 3:

'Renewable energy resource' means a solar electric, solar thermal, wind, hydropower, geothermal, or ocean current or wave energy resource; a biomass resource, including agricultural waste, animal waste, wood waste, spent pulping liquors, combustible residues, combustible liquids, combustible gases, energy crops, or landfill methane; waste heat derived from a renewable energy resource and used to produce electricity or useful, measurable thermal energy at a retail electric customer's facility; or hydrogen derived from a renewable energy resource.

'Renewable energy resource' does not include peat, a fossil fuel, or nuclear energy resource.

Q18) What are the qualifications for a renewable resource to be considered dispatchable (manually dispatched from generation schedules, or automatic generation control responding to dynamic scheduling)?

A) In a dispatchable renewable resource arrangement, schedules could be submitted manually to the seller when the renewable energy supply of energy is economic, or an automated form of dispatch and scheduling may be employed where technically and economically feasible.

Q19) Will preference be given to traditional intermediate/peaking resources or to renewable resources?

A) No preference will be given to either intermediate/peaking resources or to renewable resources.

Q20) Will renewable resource proposals be compared against only other renewable resource proposals or against traditional intermediate/peaking resource proposals?

A) All proposals will be compared together.

Q21) Must renewable resources qualify for the North Carolina Renewable Energy Portfolio Standard?

A) No, only if they are providing Renewable Energy Credits would they need to qualify.

Q22) Regarding Section C, Renewables Term Sheet, in subsection B, Dispatchable Renewables, where should the respondent submit Energy Pricing ($/MWh)?

A) Energy pricing may be included in the Variable O&M response ($/MWh) with Renewable Energy Certificate pricing identified, if offered.

Q23) Regarding Short List Development, what are the weighting values of the evaluation criteria (present value economics, location, credit, relevant experience, technology feasibility, permitting, deliverability, etc.)?

A) There are no weighting values of the evaluation criteria. Each proposal will be evaluated based on its own merits, both quantifiable and subjective.

Q24) What is the earliest delivery date (before January 1, 2015) that will be considered.

A) Duke will consider bids proposing a delivery date as early as January 1, 2013. Capacity proposals prior to 2015, during a time when DEC currently has adequate capacity reserves, will be considered by determining the net cost of deliveries prior to 2015 and adding this to the capacity cost for deliveries within the 2015 through 2017 period. “Net cost” is the bid capacity price minus the energy value (net of energy payments to seller) of the bidder’s capacity resource to the Duke system.

Q25) Will proposals with indexed energy prices be considered (such as indexed to PJM energy prices)?

A) Yes.

Q26) Is there a preference for fixed prices or for indexed prices?

A) Fixed prices are generally preferred, but indexed prices are certainly acceptable.