As part of the Application process, Jersey Central Power & Light (JCPL) requires a supplier submit with its Application Materials a Credit History Summary form in order to assess creditworthiness,
As noted in the Third Party Supplier (TPS) Agreement Appendix B1, B2, A supplier or its Guarantor is deemed creditworthy if it carries a minimum senior unsecured debt rating (or, if unavailable, corporate issuer debt rating discounted one notch) of at least “BBB-” from S&P, “Baa3” from Moody’s, or “BBB-” from Fitch. If a supplier does not meet creditworthiness standards on its own merit, it must provide an alternative credit arrangement:
- A guarantee of payment, satisfactory in form and substance to the Company, from a parent Guarantor deemed by the Company to be creditworthy
- An irrevocable Letter of Credit or Surety Bond, satisfactory in form and substance to the Company, issued by a bank or other financial institution with a minimum “A” senior unsecured debt rating
- A Cash Deposit
The following files are available to assist a supplier in demonstrating creditworthiness using an alternative credit arrangement. The Company requests that the Supplier use the following files, substantially in their form and substance.
As disclosed in Appendix B1 and B2 of the Agreement, a supplier has the option of submitting to JCPL an estimate of initial load amounts it plans on serving to BGS-CIEP, Residential BGS FP and Non-Residential BGS-FP. After power has flowed for thirty (30) days, the credit exposure will be recalculated. If the Adjusted Exposure exceeds the alternative security posted, the Company will notify the supplier and request that the supplier provide additional security. If the supplier is not able submit an estimate at time of application, then JCPL request an initial credit amount of $250,000.
JCPL Third Party Supplier Credit Calculator
Supplier Support must be informed of the specific alternative credit arrangement that the supplier will use to demonstrate creditworthiness.