Section Puc 2003.03 - Financial Security Requirements of Competitive Electric Power Suppliers(a) The financial security instrument required by Puc 2003.01(b)(2) shall: (1) Be in the form of: a. An irrevocable standby letter of credit issued by:i. A bank on the ISO-NE list of approved letter of credit banks and presentable at a U.S. office of such bank; orii. A bank with a retail office in New Hampshire and presentable at a New Hampshire office of such bank;b. A surety bond issued by an insurance company or bonding company included on the U.S. Treasury Department's list of certified companies and licensed in New Hampshire, with demand to be made on a U.S. office of the named surety; orc. An unconditional guaranty of payment executed by the parent company or other affiliate of the CEPS, if the parent company has and maintains an investment grade credit rating; (2) Be in an amount equal to the greater of: b. 25% of the CEPS's actual gross revenue in New Hampshire for the preceding full year of operation, not including revenue from the provision of default service, for any year after the CEPS's first full year of operation;(3) Not exceed $500,000, notwithstanding (2) above;(4) Name the commission as beneficiary, obligee, or guaranteed party, as applicable;(5) Have an effective term of no less than 12 months with a 6 month extended claims, draws, or demand period;(6) Have no right of cancellation during the initial effective term of the financial security instrument; and(7) Be adjusted annually, if based on actual or estimated gross revenue, under (2) b above. (b) The commission shall make a claim under or pursue an action against financial security instruments for the following purposes and in the following order of payment priority: (1) Customer complaint reparations, ordered by the commission following notice and hearing and remaining unpaid by the CEPS after 30 days;(2) Fines or sanctions for violation of applicable laws or rules, assessed by the commission following notice and hearing and remaining unpaid by the CEPS after 30 days;(3) Alternative compliance payments (ACPs) due to the commission under RSA 362-F and Puc 2500 rules, but remaining unpaid by the CEPS after 60 days; and(4) Commission annual assessment remaining unpaid by the CEPS on June 1 of any calendar year, in the absence of exemption or good faith objection.(c) Each financial security instrument shall contain the following operative language: "The New Hampshire Public Utilities Commission may draw upon this financial security instrument if and when the Company has failed to make required payment(s) and/or payment arrangements in accordance with the terms and conditions of an order issued by the New Hampshire Public Utilities Commission on _______, 20__."
(d) In the event the commission draws on a financial security instrument pursuant to Puc 2005 and (b) above, the CEPS shall replenish the financial security instrument to the full amount required by (a)(2) and (3) above within the timeframe specified by the commission in any decision or order.(e) If the financial security instrument provided by a CEPS to the commission in connection with its original or any renewal registration will not be renewed or extended beyond its expiration date, the CEPS shall: (1) Provide written notice to the commission of such non-renewal or non-extension no less than 60 days prior to the expiration date; and(2) File with the executive director a replacement financial security instrument meeting the requirements of (a) above no less than 30 days prior to the expiration date.(f) A CEPS that fails to comply with the requirement to file a replacement financial security instrument under (e)(2) above shall be subject to fines, suspension, or revocation pursuant to Puc 2005.N.H. Admin. Code § Puc 2003.03
Amended by Volume XXXVII Number 37, Filed September 14, 2017, Proposed by #12372, Effective 11/1/2017, Expires 11/1/2027.