Terms related to project development assistance.
Advanced funding agreement: The document that sets forth the terms by which the Project Applicant provides advance funds to Western for development work on an Eligible Project. An Advanced Funding Agreement (AFA) is executed after TIP has reviewed and accepted a Project Applicant’s Business Plan Proposal.
Business plan proposal: The document prepared by the Project Applicant that articulates project development, commercial, and financial plans supported by Financial Model projections. The Business Plan Proposal is a preliminary plan that identifies the conditions precedent required for a Project Applicant to apply for financing. Submitted after Western and the Project Applicant have entered into a Memorandum of Understanding, a Business Plan Proposal is a detailed, comprehensive document that will mature and be revised by the Project Applicant prior to submission of a loan application.
DOE loan programs office: A program within the U.S. Department of Energy (DOE), the Loan Programs Office (LPO) performs underwriting and loan monitoring and administration functions.
Eligible project: A project that: (1) delivers or facilitates the delivery of renewable energy resources, (2) has one terminus in Western’s service territory, (3) can demonstrate a reasonable expectation of repayment, (4) will not adversely impact system reliability or operations, and (5) is in the public interest.
Financial model: A model that includes a simulation of relevant costs, benefits, values, and risks that will be assessed when making financial decisions affecting a project. Financial Models submitted to TIP must be in Microsoft Excel format and use standard industry conventions or templates provided by Western.
Freedom of information act: Enacted on July 4, 1966, and taking effect one year later, the Freedom of Information Act (FOIA) (5 U.S.C. § 552) establishes that any person has a right, enforceable in court, to obtain access to federal agency records except to the extent that such records (or portions of them) are protected from public disclosure by one of nine exemptions or by one of three special law enforcement record exclusions. A FOIA request can be made for any agency record. For additional information refer to Western’s FOIA link, also shown at the bottom of this page under the “Business” section.
Memorandum of understanding: The standard document that sets forth an understanding between Western and a Project Applicant after Western has approved a Project Applicant’s Project Proposal. A Memorandum of Understanding (MOU) precedes the Project Applicant’s submission of a Business Plan Proposal.
Project applicant: Term used to refer to an entity that submits a Project Proposal and Business Plan Proposal.
Project development phase: The phase of the project that precedes the Project Finance Phase and construction of the project. The Project Development Phase begins when a Project Applicant submits a Project Proposal and concludes when a Project Applicant submits an application for the use of Western’s borrowing authority. The Project Development Phase may include activities associated with facilities studies, Western Electricity Coordinating Council (WECC) path rating, environmental review, design of facilities, obtaining necessary permits, negotiation and execution of commercial agreements, acquisition of external financing, and any other activity that must be completed prior to the submission of a loan application. Project Applicants may request the assistance of Program personnel during this phase.
Project finance phase: The Project Finance Phase involves the underwriting, financing, and loan monitoring and servicing for a project using Western's borrowing authority. With few exceptions, it follows completion of the Project Development Phase. The DOE LPO executes Project Finance Phase.
Project proposal: The document submitted by a Project Applicant that outlines its proposed project. The first step in the TIP Development Phase, there is no limit on the number of pages for a Project Proposal. A Project Proposal must, at a minimum, include a detailed description of the proposed project (including transmission route information, if applicable, and a preliminary financial model), the proposed role that TIP would play in project development, and sufficient information to demonstrate that the project meets or is reasonably expected to meet Western’s Project Evaluation Criteria.
Public interest: That which generally benefits the public at large. For purposes of determining whether a proposed project is in the “public interest,” Western will examine the intent of the Recovery Act, existing transmission infrastructure needs, economic impacts and the environmental impacts.
For additional details, read the Federal Register Notice.