Updated October 28, 2009
Click on the question to read the answer.
- How and when will SCE choose strike prices? Will SCE consider strike prices chosen by the Counterparty?
- What is the total volume sought in this Gas RFO?
- Why is SCE using World Energy for this RFO?
- Why does SCE require the World Energy bids to remain binding for 15 minutes after the conclusion of each auction?
- Will there be volume limits to the World Energy auction platform?
- Can I bid above my volume limit?
- What are the award selection criteria? Can there be multiple winners to the auction?
- Can we submit more than one offer? For example, can I offer x/month at .211 and then additional volumes at .212 and .213 and potentially transact each simultaneously if SCE chooses enough volume?
- Can we participate for only a portion of the term? For instance, could we offer April 2011-December 2012 instead of the full term April 2011-December 2014 for the annual hedge period?
- What is the payment term on call options?
- Are previously negotiated confidentiality agreements applicable to this Gas RFO?
Q1. How and when will SCE choose strike prices? Will SCE consider strike prices chosen by the Counterparty?
A1. SCE will determine strike prices based on market prices and portfolio requirements. As a point of reference, in the Spring 2009 Gas RFO, SCE requested final offer call options with the strike price set at approximately $0.50/MMBtu out-of-the-money.
SCE will choose and communicate the strike price with all qualified respondents to this Gas RFO on November 13, 2009. SCE will not consider any strike price other than the ones determined by SCE.
TOP
Q2 . What is the total volume sought in this Gas RFO?
A2. SCE is targeting 600,000 MMBtu/month of Annual & 600,000 MMBtu/month of Q3. SCE reserves the right to award less than or none of the target volume.
TOP
Q3. Why is SCE using World Energy for this RFO?
A3. To the extent possible, SCE desires to automate the RFO closing process and provide feedback to CP. The World Energy platform allows SCE to do this by providing web-based bidding and dynamic low-price feedback to bidders during the auction process.
TOP
Q4. Why does SCE require the World Energy bids to remain binding for 15 minutes after the conclusion of each auction?
A4. SCE requires the bids to remain binding while we call bidders at the conclusion of each auction to inform them of their awards during the award notification period.
TOP
Q5.Will there be volume limits to the World Energy auction platform?
If any Bidders require a volume limit, it should be communicated to both World Energy and SCE. Likewise, if SCE imposes a volume limit on a Bidder, it will be communicated to both World Energy and the Bidder. SCE will take volume limits into consideration as we are awarding bids.
TOP
Q6. Can I bid above my volume limit?
A6. Yes. SCE will only consider the lowest priced bids up to the volume limit. Partial awards may be made to match the volume limit. SCE will not make any awards above any imposed Bidder volume limits.
TOP
Q7. What are the award selection criteria? Can there be multiple winners to the auction?
A7. SCE will make awards based on (i) price, (ii) bid submission time (first-in first-out for ties based on price), and (iii) volume limits (if any). There can be multiple winners based on the award criteria.
TOP
Q8. Can we submit more than one offer? For example, can I offer x/month at .211 and then additional volumes at .212 and .213 and potentially transact each simultaneously if SCE chooses enough volume?
A8. Yes, you are able to submit offers of varying quantities and prices. Bidders may submit as many offers as they would like provided that each offer is in multiples of 50,000 MMBtu/mo (the lot size) up to a maximum quantity of 600,000 MMBtu/mo. Bidders may be awarded different quantities at different prices, please see question 7 for the award selection criteria.
TOP
Q9. Can we participate for only a portion of the term? For instance, could we offer April 2011-December 2012 instead of the full term April 2011-December 2014 for the annual hedge period?
A9. No, you cannot submit for partial terms of each auction.
TOP
Q10. What is the payment term on call options?
A10. The terms and conditions of the NYMEX will prevail on call options since we are clearing the call transactions through NYMEX Clearport. Currently they are margining transactions and invoicing transactions at the COB of each business day with payment due in 2 days.
TOP
Q11. Are previously negotiated confidentiality agreements applicable to this Gas RFO?
A10. Previously executed Confidentiality Agreements may be applicable, depending on the particular terms negotiated by the parties. Each previous participant should verify with their SCE contract manager whether their Confidentiality Agreement is sufficient for participation in this Gas RFO.
TOP