1 SUPPLIER UPDATE September 23, 2015
Agenda 2 Clarify and document Supplier Collateral Requirement New Customer Information Agreement Review Customer Education campaign Q&A
Credit Requirements For Suppliers 3 Supplier credit requirements established in General Terms and Conditions of Pooling Service Energy Choice: Section 23 Full Requirements: Section 19 Collateral Requirement Energy Choice: Section 23:20 of GT&C Full Requirements: Section :19:19 of GT&C Secured Interest Energy Choice: Sections 23:15-19 Full Requirements: Sections 19:14-18
Collateral Requirement Formula 4 Energy Choice Pooling Service Full Requirements Pooling Service CR = (TPR (LP + AS)) x Pco Terms defined: CR = Collateral Requirement TPR = Total Pool Requirements (Mcf) LP = Local Production (Mcf) AS = Available Storage (Mcf) in beginning of month inventory Pco = Cashout Price ($/Mcf) negative imbalance volume cash out rate Pbr = Billing Rate Price ($/Mcf)
Secured Interest Requirement 5 Granting Language General Terms and Conditions of Pooling Service - Energy Choice: 23.15/Full Requirements: 19:14 Supplier shall grant East Ohio a Security interest in the Collateral, as defined herein, to secure the payment and performance of the Supplier s obligations Energy Choice: 23.17/Full Requirements: 19:16 Supplier s failure to grant East Ohio a security interest in the Collateral may result in East Ohio eliminating any unsecured credit extended to Supplier and adjusting the collateral requirement formula...
Changes To The Requirement 6 Review of Uniform Commercial Code (UCC) filings for each supplier If review finds no outside security interest in the receivables, storage, or local production portion of the collateral, supplier will be asked to sign a granting agreement. If review finds outside security interest in the receivables or storage, or local production portion of the collateral, supplier will be asked to: 1. Release the outside security and sign the Dominion granting agreement, or 2. Increase the collateral requirement in the form of the letter of credit (LOC) held by Dominion. File Granting Agreements with UCC
Next Steps 7 Update UCC Research: August, 2015 Supplier Conference Call: September, 2015 Letters to suppliers detailing UCC/security interest status: September/October 2015 Suppliers need to provide credit/risk contact person to DEO by 9/30/15 (email to EOG_TRANS_SERV@dom.com)
Next Steps (Continued) 8 Depending on presence/absence of outside security interest in collateral determinants: Granting Agreements/UCC Filing: TBD Increase Collateral Requirement: TBD New security interest confirmation and/or increased collateral requirement will be in place by the earliest of the 2016/2017 auction requirement or April 1, 2016
Customer Information Agreement 9 Per request of the Ohio PUC, the following customer information will be provided upon request with a new Customer Information Agreement. Customers who have opted-out will not be included. An aggregation list includes SSO (non-pipp), SCO and MVR customers. A full customer list includes SSO (non-pipp), SCO, MVR, EC (regardless of supplier) and aggregation customers (regardless of supplier). Compliance with the Supplier Code of Conduct is required
Customer Education Campaign 10 Worked with the Ohio PUC Staff to develop a Customer Education Initiative for DEO s Energy Choice Program Awareness of DEO rate choice options for residential and non- residential Understanding your bill and current rate choice Where to go for options Creative work developed includes direct mail (see below), brochure, and new customer information core message 3 Easy Steps
Wrap-Up 11 Meeting attendees please confirm your attendance on today s call by sending an email to Dina Gallaway, dina.m.gallaway@dom.com Questions: Contact Cliff Andrews 216.736.6586 or Dina Gallaway 216.736.6559