This sample letter of credit is meant to serve as an example of a letter of credit that the Commission has previously approved. Letters of credit submitted to the Commission can take different forms but must include the appropriate case reference numbers and certificate of public good condition(s) references, the proper name of the Commission ("Vermont Public Utility Commission"), references to the applicability of ICC Publication No. 590 and the laws of the State of Vermont, and relevant provisions addressing the CPG conditions.
On April 25, 2024, the Public Utility Commission opened case 24-1240-INV to issue a general order clarifying the meaning of "A-Rated" status for financial institutions issuing letters of credit for Section 248 facilities.
The Commission also requires that:
- The Drawing Certificate include the following language: "This Letter of Credit has fewer than 30 days remaining prior to the date of expiration and the Beneficiary has not received a replacement letter of credit to the extent required by the Certificate of Public Good, and the undersigned hereby confirms that the amount of this drawing does not exceed the undrawn face amount of the Letter of Credit";
- The irrevocable standby letter of credit include an automatic renewal provision ("evergreen clause") and be bankruptcy remote;
- The Commission be named as the sole beneficiary;
- The letter of credit be from an A-rated financial institution; and
- The letter of credit comply with Commission Rule 5.900.
On June 21, 2024, the Public Utility Commission opened case #24-1921-INV to issue guidance for Commission Rule 5.904(B)(8) filings to release excess funds after decommissioning is complete. On November 26, 2024, the Public Utility Commission issued an Order Establishing Guidance for Rule 5.904(B)(8) Filings.
The information provided on this website does not, and is not intended to, constitute legal advice; instead, this sample is provided for informational purposes only.