Attachment A, Scope of Work.pdf

ITB No. 25-83101601-ITB Natural Gas Supply Page 1 of 8

ATTACHMENT A

SCOPE OF WORK

1. PURPOSE

To provide Customers with Natural Gas Supply on a statewide basis, pursuant to the terms set forth in this Scope of Work.

2. DEFINITIONS

Definitions contained in section 287.012, Florida Statutes (F.S.); Rule 60A-1.001, Florida Administrative Code (F.A.C.); and Attachment B, Enterprise Standard Terms and Conditions; are incorporated by reference. In the event of a conflict, the definitions listed in this section supersede the incorporated definitions for the purposes of this Scope of Work. All definitions apply in both their singular and plural sense.

Baseload – The volume of Natural Gas requested for purchase at least six (6) business days prior to the start of each month, a portion of which may include fixed price volumes for such month.

This volume will be divided equally among all the days in a month.

British Thermal Unit (Btu) – A traditional unit of heat; it is defined as the amount of heat required to raise the temperature of one pound of water by one degree Fahrenheit.

Business Day – Monday through Friday, inclusive, except for those holidays specified in section 110.117, F.S., from 8:00 a.m. to 5:00 p.m. at the Customer’s location.

Commodity Code – The State’s numeric code for classifying commodities and contractual services which meet specific requirements, specifications, terms, and conditions herein. Florida has adopted the United Nations Standard Products and Services Code (UNSPSC) for classifying commodities and services.

Confirmation – The process of verifying or confirming the status of a Nomination.

Contract Manager – The representative designated by the Department who will oversee all aspects of the Term Contract, monitor performance expectations, and serve as the primary point of contact for the Contractor.

Contractor – A vendor that enters into a Term Contract with the Department.

Customer – A State agency or Eligible User.

Dekatherm (DTH) – A unit of energy used primarily to measure Natural Gas; equal to 10 Therms or one million British Thermal Units (MMBtu).

Department – The Department of Management Services (DMS), a State agency.

Designee – An entity that acts on behalf of the Department to perform the duties of invoice/payment obligations, Nomination, Confirmations, and Imbalance resolutions in accordance with the terms and conditions of the FTS Service Agreements.

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Federal Energy Regulatory Commission (FERC) – Federal agency that monitors and establishes index prices for Natural Gas.

Firm Markup – The percentage shown on Attachment C, Firm Markup Sheet, to be added to the cost of Natural Gas (as described in section 3.4.1 Firm Markup of this Scope of Work) to fully satisfy Contractor’s obligations under the Term Contract, inclusive of overhead, delivery, profit, and any other fees and charges not passed through to Customer under section 3.4.4 Fuel Fees, Usage Fees, Taxes, and other costs of this Scope of Work. Except as expressly set forth in the Term Contract, no additional compensation will be due to Contractor in addition to the Firm Markup.

Florida Gas Transmission Company (FGT) – The Company that uses the Natural Gas interstate pipeline network to transport Natural Gas to Florida.

FTS Service Agreements – The following two firm transportation service agreements between FGT and the Department and any amendments thereto: Contract No. 5085 (a/k/a “FTS-1”), and Contract No. 5626 (a/k/a “FTS-2”).

Imbalance – The difference between Customer requested volumes of Natural Gas and volumes of Natural Gas consumed by Customer.

In-Day Gas – Any volume of Natural Gas requested between 09:30AM EST, and 04:00 PM EST on the Business Day of Natural Gas flow. Availability of the purchase or sale of In-Day Gas is not assured and must be confirmed before availability is guaranteed.

Local Distribution Company (LDC) – A state regulated Natural Gas utility which owns or operates the Natural Gas lines and equipment necessary to deliver Natural Gas to the consumer.

Market Price – The prevailing price at which Natural Gas is being bought and sold at a specific time and location, as published in Platts’ Gas Daily as the midpoint or average price for such time and location.

MMBtu – One million British thermal units.

Natural Gas – A fossil energy source that formed deep beneath the earth’s surface. Natural Gas is made up of a mixture of primarily four naturally occurring gases: methane, which makes up 70- 90% of Natural Gas, along with ethane, butane, and propane. Natural Gas is also referred to in this Scope of Work as the “Commodity.”

Nomination – A request for a physical quantity of Natural Gas under a specific purchase, sale or transportation agreement or for all contracts at a specific point.

Purchase Order – A written offer/request made by a Customer to purchase a specific volume of Natural Gas.

Swing Natural Gas – Volume of the Natural Gas above the Baseload volume of Natural Gas on any day that Customer(s) request delivery of by 9:30 AM ET on the Business Day immediately before the requested Natural Gas is to flow.

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Term Contract – The legally enforceable State Term Contract, as defined in section 287.012, F.S., between the Department and the Contractor. Term Contract is also referred to in this Scope of Work as the “Contract.”

Therm – A unit of heat equal to 100,000 Btu.

Turnback Natural Gas – Volume of Natural Gas that the Customer elects to turn back to the Contractor.

3. SCOPE OF WORK

3.1 Description of Scope

The Contractor shall supply Natural Gas as defined herein.

3.2 General Requirements

3.2.1 Quantity, Quality, and Regulatory Compliance

3.2.1.1 The measurement, testing, heating value, delivery pressure and quality of the Natural Gas delivered shall be in accordance with all applicable laws, the terms and conditions of the delivery specifications of the applicable FGT tariffs, and in accordance with the FTS Service Agreements.

3.2.1.2 The Contractor must have a minimum current capacity of 2,100 MMBtu of Natural Gas daily made available during the initial and if applicable, renewal terms. The Contractor will make this volume available on a firm basis pursuant to the FTS Service Agreements.

3.2.1.3 The Contractor shall file and pay for any filings covering this Contract with the applicable federal, state, or local regulatory authority, and shall prosecute diligently all application, notices, or reports required to be filed on behalf of the state and itself to comply with all legal requirements to purchase and deliver Natural Gas to all Customers that request Natural Gas during the Contract term.

3.3 Delivery Requirements

3.3.1 The Contractor shall be responsible for the scheduling and delivery of Natural Gas, including completing all arrangements for transportation services for the delivery of the Natural Gas to the Customer’s location. Delivery shall be F.O.B.

destination, freight included and unloaded to the Customer’s location.

3.3.2 The Contractor warrants that it has or will secure good and marketable title to the Natural Gas being provided under this Contract, that it has or will have the right without restriction to sell such Natural Gas, and that such Natural Gas is free from liens and adverse claims of any kind.

3.3.3 The Contractor shall be in exclusive control and possession of Natural Gas prior to the delivery thereof to the Customer. The Department or the Customer will not be responsible for the damages occurring during control and possession by the Contractor. The Contractor will be responsible for making any and all claims

Natural Gas Supply Page 4 of 8 against carriers for missing or damaged items.

3.3.4 The Contractor shall serve as the Department’s Designee to perform the duties of invoice/payment obligations, Nominations, Confirmations, and Imbalance resolutions in accordance with the terms and conditions of the FTS Service Agreements. To fulfil this duty, the Contractor shall sign documents titled “Designee Request Form” where the Department assigns to the Contractor its responsibilities under the Services Agreements for the shipping of Natural Gas.

This Form can be found at:

https://fgttransfer.energytransfer.com/ipost/FGT/posted-documents

3.4 Pricing

3.4.1 Firm Markup

The Firm Markup price is the percentage to be added to the cost of Natural Gas (per DTH), consisting of all charges necessary for the Contractor to fully complete and invoice the business transaction, inclusive of overhead, delivery, profit, and any other fees and costs not passed through to Customer under section 3.4.4 Fuel Fees, Usage Fees, Taxes, and other costs of this Scope of Work. The Firm Markup, as shown on Attachment C, Firm Markup Sheet, shall not increase during the term of the Contract. The Firm Markup will be applied only to the cost of Natural Gas (as described in section 3.4.2 Cost of Natural Gas of this Scope of Work) delivered to Customer and not to any other amounts that may be charged to or owed by Customer.

The Contractor shall adhere to the Firm Markup Price submitted in Attachment C, Firm Markup Sheet, which is incorporated into the Term Contract. The Contractor may decrease the Firm Markup Price but shall not increase the Firm Markup Price submitted in Attachment C, Firm Markup Sheet.

3.4.2 Cost of Natural Gas

The cost of Natural Gas to be paid by the Customer for each month in which deliveries occur shall be fixed by the published average price of Natural Gas as published in the U.S Energy Information Administration Natural Gas Supply Weekly Update.

3.4.3 Unit of Measurement at Metering Base

The unit of measurement for billing purposes shall be per MMBtu for each Customer as provided to the Contractor by the applicable LDC or transportation pipeline owner/operator.

3.4.4 Fuel Fees, Usage Fees, Taxes, and other costs

Fuel fees, usage fees, LDC charges, and permitted taxes applicable to the Customer’s receipt of Natural Gas hereunder and incurred by Contractor will be passed through to the Customer without markup or adjustment by the Contractor. Any other costs incurred by Contractor on account of Customer’s receipt of Natural Gas hereunder may be passed through to the Customer only with Customer’s prior written consent and in no event will a markup or adjustment by Contractor be permitted.

3.4.5 Conversion Fees

Conversion fees are the cost associated with converting an existing facility from other sources of energy to Natural Gas. These changes may include installation https://fgttransfer.energytransfer.com/ipost/FGT/posted-documents/show-document/41277

Natural Gas Supply Page 5 of 8 of pipe or other plumbing fixtures to facilitate the delivery of Natural Gas to the Customer’s final location. The amount and extent of any such charges shall be determined through a mutual agreement of the Customer and the Contractor at the time the individual Customer order is placed and shall not be included in the Firm Markup.

3.4.6 Balancing of Quantities

The Customer shall be allowed a +/-10% Imbalance tolerance. All volumes consumed with a +/- 10% of volumes requested by Purchase Order will be billed at the Contract price for the volumes requested in the Purchase Order.

Customer(s) will be responsible for paying for any Imbalance cost if their consumption falls outside of the +/-10% Imbalance tolerance between requested and consumed volumes. The Contractor will reimburse Customer(s) for any Imbalance cost and/or penalties that may be charged to Customer(s) or Contractor due solely to the Contractor’s failure to schedule volumes requested by Purchase Order.

The Contractor shall be responsible for and shall submit Nominations for Customer(s) Natural Gas requirements directly to FGT, based upon monthly or daily volume specified in writing by Customer(s).

The Customer may request that Natural Gas be purchased or sold on Customer’s behalf, in order to avoid Imbalance and/or penalties. The Contractor shall use its best efforts to purchase or sell Natural Gas on Customer’s behalf.

Any In-Day Gas purchased or sold on behalf of Customer(s) shall be purchased or sold at the then current Market Price.

3.4.7 Credit for Turnback Natural Gas

For Turnback Natural Gas that the Customer elects to turn back by the deadline for Swing Natural Gas for the same day of flow, the amount credited to Customer’s account shall be lowest of the published Natural Gas daily Midpoint index prices for FGT Zones 1, 2, 3 for the day the Natural Gas is to be turned back, reduced by an additional $0.50 per MMBtu. (Refer to the Platts' Gas Daily publication for that day’s Midpoint index price.) This amount is then increased by the pipeline fuel percentage, and any applicable transporter’s usage. (Refer to the FERC Gas tariff for pipeline fuel percentage and applicable transport’s usage: https://fgttransfer.energytransfer.com/ipost/FGT/tariff/entire-tariff.) For Turnback Natural Gas that Customer notifies the Contractor after the deadline (for Swing Natural Gas for the same day of flow) the amount credited to the Customer’s account shall be, at Customer’s election, either (i) the daily Market Price reduced by an additional $0.50 per MMBtu for the day Natural Gas is to be turned back or (ii) included on the Customer’s monthly Imbalance.

Customer(s) must choose either of these options at the time Turnback Natural Gas is requested.

3.5 Invoice Requirements

3.5.1 The Contractor shall provide and submit timely, monthly invoices to the Customer listed on each Purchase Order issued pursuant to this Contract.

3.5.2 The Contractor shall invoice based on volumes ordered by Customer and delivered. Any Imbalances shall be reconciled monthly (cashed out) and applied to the Customer(s) invoice according to the rules shown in the applicable FGT https://fgttransfer.energytransfer.com/ipost/FGT/tariff/entire-tariff

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3.5.3 Within five days of the Department’s request, the Contractor shall supply to the

Department all the data, calculations, and documents used in computing all cost associated with the supply and delivery of Natural Gas for any particular Customer invoice.

3.5.4 The Contractor shall attach with each Customer invoice a copy of the applicable index price according to Platts' Gas Daily publication.

3.5.5 At minimum the monthly invoices are to provide the following information:

• Customer Name and Location

• Invoice Number, Invoice Date, Meter number, Ship to, Remit to, Bill to, Account number, PO

• Index Price

• FGT Fuel Fee

• FGT Usage fee

• Firm Markup Price

• Total Unit Price (per DTH)

• DTH Supplied

• LDC Passthrough Charge

• All other costs agreed to by Customer not otherwise enumerated in this bulleted list with an explanation of the cost.

• Total invoice price.

3.6 Customer Service

The Contractor shall designate a Contract Administrator to oversee the Term Contract. The responsibilities of the Contractor Administrator shall include but are not limited to overseeing the delivery of Natural Gas, scheduling, reporting, record keeping, and billing. The Contract Administrator shall be the Department’s and Customer’s point of contact for the Contractor. The Contractor shall provide the contact information for the designated Contract Administrator to the Contract Manager within ten Business Days after the Term Contract effective date and update the Contract Manager with any changes within two Business Days. The Contract Administrator shall work with the Customer to resolve any issues or discrepancies and ensure that all Natural Gas deliveries are provided to the Customer in accordance with the Contract and applicable Purchase Order.

3.7 Recalled Commodities

In the event there is a recall of any Commodity offered on the Term Contract, or any part or component of a, or any parts incorporated into the Commodity, the Contractor shall assist the Department and Customers in developing a recall strategy and shall cooperate with the Department and the Customers in monitoring the recall operation and in preparing such reports as may be required. Each Contractor shall, at the request of the Department or any Customer, assist the Department and each Customer in locating and obtaining any recalled Commodities.

Each Contractor shall immediately notify and provide copies to the Department of any communications, whether relating to recalls or otherwise, with any Customer. The Contractor shall ensure recalled Commodities are rectified, replaced and destroyed in compliance with all applicable laws, rules or regulations and the Department's instructions. All efforts relating to Recalled Commodities shall be at the Contractor’s expense.

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3.8 Compliance and Compatibility

It is the Contractor’s responsibility to ensure that the Commodities and any services supplied therewith are compliant with the Term Contract requirements, specifications, terms, and conditions. Additionally, the Contractor shall ensure that all Commodities ordered by the Customer are fully compatible with each other and with any associated pre-existing Commodity possessed by the Customer and disclosed to the Contractor by the Customer. The Contractor’s acceptance of the Customer’s order shall indicate that the Contractor agrees to deliver Commodities and services that are fully compliant and compatible with the Customer’s order requirements, specifications, terms, and conditions.

3.9 Request for Quote Requirement

Customers shall use a Request for Quote in accordance with section 287.056(2), F. S., and Rule 60A-1.043, F.A.C., when making purchases off this State Term Contract (Term Contract). For any purchases off the Term Contract, the Contractor recognizes its responsibility for all tasks and deliverables contained in the Term Contract and any Customer Request for Quote, warrants that it has fully informed itself of all relevant factors affecting accomplishment of the tasks and deliverables and agrees to be fully accountable for the performance thereof

3.10 Financial Consequences

Failure to comply with the requirements of the Term Contract will result in the imposition of financial consequences. The following financial consequences will apply for the Contractor’s failure to meet the performance metric standard and due date corresponding with the deliverables under the Term Contract. The Customer may impose additional Financial Consequences beyond those stated herein to apply to that Customer’s purchase. The State of Florida reserves the right to withhold payment or implement other appropriate remedies, such as Term Contract termination, or nonrenewal, when the Contractor has failed to comply with the provisions of the Term Contract.

The financial consequences below will be paid and received by the Department of Management Services within 30 calendar days from the due date specified by the Department. These financial consequences below are individually assessed for failures over each target period beginning with the first full month or quarter of the Term Contract performance and every month or quarter, respectively, thereafter.

Financial Consequences Chart

Deliverable Performance Metric Performance Due Date

Financial Consequence for Non-Performance

Contractor will timely submit complete Term Contract Quarterly Sales Reports

All Term Contract Quarterly Sales Reports will be submitted timely with the required information

Completed reports are due 10 calendar days after the close of the quarter.

$250 per day late

Contractor will timely submit complete MFMP Transaction Fee Reports

All MFMP Transaction Fee Reports will be submitted timely with the required information

Completed reports are due on or before the 15th calendar day after the close of each month

$100 per day late

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No favorable action will be considered when Contractor has outstanding Term Contract Quarterly Sales Reports, MFMP Transaction Fee Reports, or any other documentation owed to the Department or Customer, to include fees / monies, that are required under this Term Contract.