Government Certifications

27 6.21. Deed or Contractual Restrictions 28 6.22. Other Grants or Assistance 29 6.23. Fraud and Non Compliance 29 6.24. Unforeseeable Circumstances 30 6.25. Code of Ethics for Contractors, Service Providers and Applicants for Economic Incentives 30 CHAPTER TWO TIER I PROGRAM 32 I. Type of Awards 32 II. Eligibility 32 III. Application Procedure 33 IV. Application Documents 38 i V. Final Determination 40 CHAPTER THREE TIER 2 PROGRAM 41 I. Type of Awards 41 II. Application and Award Timeline 41 III. Eligibility 43 IV. Application Procedure 44 V. Application Requirements 50 VI. Evaluation Procedure 58 VII. Evaluation Criteria 58 VIII. Appeal 60 CHAPTER FOUR OTHER PROVISIONS AND EFFECTIVENESS 63 I. Interpretation 63 II. Ethical Considerations 63 III. Effectiveness 64 ii Chapter One INTRODUCTION, BACKGROUND AND GENERALLY APPLICABLE PROVISIONS I. Title and Introduction This Regulation shall be known as the "Green Energy Fund Regulation." The Puerto Rico Energy Affairs Administration (PREAA) was created to design, develop, and implement energy policy that strengthens energy security, environmental quality and economic development in Puerto Rico. PREAA will develop strategies to reduce our high fossil fuel dependency, address climate and environmental issues, promote competitiveness, industrial development, and encourage energy conservation and efficiency. Since its creation under Act No. 128 of June 29, 1977 as the Office of Energy attached to the Governor's office, PREAA has acquired multiple functions and responsibilities. Hence PREAA, directly and through its predecessors, has developed solid experience within the energy sector in Puerto Rico. On July 19, 2010, Act No. 83 (Act 83) was enacted to designate PREAA as the Government entity in charge of implementing green energy incentives in Puerto Rico and the policy defined in such law. Act 83 recognized that the high cost of energy increases the cost of doing business in our island. High energy costs are detrimental to our quality of life, our environment, and our economic competitiveness. Incentivizing green energy addresses these costs, quality of life and environmental and economic barriers, while improving public health. Act 83 was approved to incorporate new and integrated incentives for the production of energy with alternative and sustainable renewable sources. Act 83 assembles under one law our existing economic incentives and reforms, and organizes and standardizes incentives for the construction and use of renewable energy sources. It creates a unified framework of economic benefits and incentives that are expected to make Puerto Rico a more competitive jurisdiction for the development of renewable energy. Act 83 offers new benefits to stimulate the development of green energy projects, addresses tax credits, Renewable Energy Certificates (RECs) and the Green Energy Fund (the "GEF"). As part of the implementation of Act 83 with respect to the GEF, PREAA is called to create and approve this Regulation for the Tier 1 and Tier 2 programs. II. Legal Basis This Regulation is issued in accordance with and pursuant to the powers conferred to PREAA under Act No. 83 of July 19, 2010; and Act No. 170 of August 12, 1988, as amended. 2 III. Purpose The purpose of this Regulation is to create parameters, mechanisms and standard criteria for implementing incentive programs under the GEF for Tier I Projects (also referred to as Small-Scale Green Energy Projects) and Tier II Projects (also referred to as Medium-Scale Green Energy Projects). IV. Applicability This Regulation shall be applicable to PREAA and all parties involved in the process of submitting, evaluating and selecting applications to receive funding from the Green Energy Fund under any of the incentive programs included herein. V. Definitions The following terms used in this Regulation shall have the meaning ascribed to them below. Terms not defined in this Regulation shall have the meaning ascribed to such term in the Act. 5.1 Act shall mean Act No. 83 of July 19, 2010. 5.2 Applicant shall be the person or entity submitting a GEF program application and serves as the main contact to PREAA through the application process. 5.3 Application Fee shall mean a non-refundable standardized amount based on the GEP system size, to be charged to the Applicants to process an application under this Regulation. 3 5.4 Authorized Representative shall be the optional third party that a Customer may designate in writing if Customer desires to delegate in such third party the authority to apply on his or her behalf. If a Customer designates such Authorized Representative, Customer shall complete the authorization letter using the template available in the Green Energy Fund webpage indicated in Section 6.2.1 of Chapter One. 5.5 Business Day means a day other than Saturdays, Sundays and such other days recognized as holidays by the Government of Puerto Rico. 5.6 Completed shall mean, with respect to a project, an eligible GEP that is fully installed, permitted and fully capable of being placed into operation. 5.7 Controlled Group shall mean the Controlled Group of Corporations or Partnerships as such term is defined in the Act. 5.8 Customer shall be the end-user/ receiver of the electricity produced by the GEP, including individuals, legal entities, and Controlled Groups, in connection with which GEP an incentive application is submitted under this Regulation. The Customer will be the incentive reservation holder. Customer need not be the System Owner. In addition, Customers may designate a third party Authorized 4 Representative to act on its behalf during the application process. 5.9 Evaluation Committee shall mean the committee to be appointed in accordance with Act No. 83 to certify the final determinations of the Technical Committee under the Tier 2 program and approve GEF disbursements amounting to or exceeding $500,000. 5.10 Facility shall mean the property or site where the Green Energy Project will be developed. 5.11 Force Majeure shall mean a cause beyond the control of the Customer or System Owner affected thereby and which, by the exercise of reasonable diligence, such party is unable to prevent or overcome to the extent that it becomes unable to perform its obligations of constructing, installing and completing the GEP on schedule, including, acts of God (including earthquakes and tsunami) more severe than typically experienced in Puerto Rico; war, rebellion, revolution, riot, or insurrection (including for the avoidance of doubt, terrorism) which causes physical damage and long term disruption, in each case within and involving Puerto Rico; or any other sudden accident or natural disaster which is not the result of an act, omission or default of the Applicant or any person for whom it is responsible. 5 5.12 GEPs shall mean Green Energy Projects.