Section 451.10  Definitions and Incorporations

            "Accountant's report" has the same meaning as in 17 CFR 210.1-02 and 210.2-02 as of April 1, 2001.  No incorporation of the Code of Federal Regulations in this Section 451.10 includes any later amendment or edition.

            "Act" means the Public Utilities Act [220 ILCS 5].

            "Alternative retail electric supplier" or "ARES" has the same meaning as in Section 16-102 of the Act.

            "Applicant" means an entity that files an application with the Illinois Commerce Commission to provide electric service as an alternative retail electric supplier under Section 16-115 of the Act.

            "Best's financial size category" refers to a numerical value that A.M. Best or its successor assigns to an insurance company based on the amount of that insurance company's policyholders' surplus and reserve funds.

            "Best's rating" refers to a rating from A.M. Best or its successor that provides an overall opinion of an insurance company's ability to meet its obligations to policyholders.

            "Business enterprise" means a commercial enterprise or establishment.

            "Certified", when used in regard to financial statements, has the same meaning as in 17 CFR 210.1-02 as of April 1, 2001.  No incorporation of the Code of Federal Regulations in this Section 451.10 includes any later amendment or edition.

            "Commercial general liability insurance" means insurance that covers suits against the insured for personal injury and property damages.

            "Commission" means the Illinois Commerce Commission.

            "Electric cooperative" means the same as that term is defined in Section 3.4 of the Electric Supplier Act [220 ILCS 30/3.4].

            "Financial statements" has the same meaning as in 17 CFR 210.3-01 to 210.3-05 as of April 1, 2001.  No incorporation of the Code of Federal Regulations in this Section 451.10 includes any later amendment or edition.

            "Guarantee" means an undertaking by a guarantor to pay or fulfill the obligation upon failure of the principal obligor to fulfill its contractual obligations.  A guarantee shall contain the following provisions:

            The guarantee is one of payment and not of collection;

            The guarantor's obligations under the guarantee are weighed equally with other guarantees;

            The obligations from transactions entered into under the original guarantee must be the subject of an ongoing guarantee;

            The guarantee reinstates if any guaranteed payment made by the primary obligor is recaptured as a result of bankruptcy or insolvency; and

            The guarantee is binding on successors of the guarantor.

            "Letter of credit" means an instrument issued by a bank guaranteeing the payment of a customer's (i.e., the applicant or ARES) drafts in favor of a third party up to a stated amount for a specified period.

            "License bond" means an obligation of a surety to pay the monies that the licensee owes the State of Illinois for violations of the duties and obligations imposed on it as an ARES.

            "Management position" means an employed position whereby an individual is responsible for directing, supervising, or administering the activities of a group of two or more people with fiscal responsibility and authority over that group.

            "Material" has the same meaning as in 17 CFR 210.1-02 as of April 1, 2001. No incorporation of the Code of Federal Regulations in this Section 451.10 includes any later amendment or edition.

            "Municipal system" means any public utility owned and operated by any political subdivision or municipal corporation of the State of Illinois, or owned by such an entity and operated by any lessee or agent thereof.

            "Parent" has the same meaning as in 17 CFR 210.1-2 as of April 1, 2001. No incorporation of the Code of Federal Regulations in this Section 451.10 includes any later amendment or edition.

            "Payment bond" means an obligation of a surety to pay the monies that the principal (i.e., the applicant or ARES) owes another party in the event that the applicant fails for whatever reason to perform its contract or contracts.

            "Permit bond" has the same meaning as "license bond".

            "Qualifying surety" means a surety or insurer that is authorized by the U.S. Department of Treasury pursuant to 31 USC 9305.  A qualifying surety or insurer may not underwrite more than the amount specified by the U.S. Department of Treasury on a single bond.

            "Ratings agency" means Standard & Poor's or its successor, Moody's Investors Service or its successor, or Fitch Ratings or its successor.

            "Retail customer", as used in this Part, means the same as the term is defined in Section 16-102 of the Act.

            "RTO" means a Regional Transmission Organization.

"Segment" refers to a component of an entity whose activities represent a separate major line of business or class of customer.

            "Small commercial retail customer" means the same as the term is defined in Section 16-102 of the Act.

            "Surplus Line Association of Illinois" is an organization of Illinois surplus line producers as defined in Section 445.1 of the Illinois Insurance Code [215 ILCS 5/445.1].

            "Technical staff" means a staff of trained technical experts in electric power and energy supply, including persons who have completed an accredited or otherwise recognized apprenticeship program or a formal education program and persons who possess no less than four years of experience working in a similar position with a utility, ARES or related business. This shall also include those persons registered as professional engineers as required by the Professional Engineering Practice Act of 1989 [225 ILCS 325].

"Unconditional guarantee" has the same meaning as "guarantee" with these additional provisions:

            The guarantor has subjected itself to jurisdiction and service of process in accordance with the laws of the State of Illinois, and the guarantee will be construed in accordance with the laws of the State of Illinois without reference to conflict of laws principles; and

            The guaranteed obligations are unconditional, irrespective of value, genuineness, validity, waiver, release, alteration, amendment, and enforceability of the guaranteed obligations.

(Source:  Amended at 34 Ill. Reg. 15283, effective September 25, 2010)

Section 451.20  Requirements for All Applicants under Section 16-115(d) of the Act

Each applicant, except electric cooperatives or municipal systems making an election under Section 17-300 of the Act  to become an ARES and applicants filing under Section 16-115(e) of the Act, for certification as an ARES must include with its application the following items, as required by Section 16-115(d) of the Act:

a)         The applicant shall certify that it will comply with all applicable Federal, State, regional and industry rules, policies, practices, procedures and tariffs for the use, operation, maintenance, safety, integrity, and reliability of the interconnected electric transmission system and shall agree to submit good faith schedules of transmission and energy in accordance with applicable tariffs.

b)         The applicant shall certify that it will comply with informational and reporting requirements that the Commission may by rule establish and provide for review by Staff on a confidential and proprietary basis data related to contracts for the purchase and sale of electric power and energy (see 220 ILCS 5/16-115(d)(4)).

c)         The applicant shall provide the following:

1)         Applicant's name and street address; and

2)         Applicant's Federal Employer Identification Number (FEIN).

d)         The applicant shall demonstrate that:

1)         The applicant is licensed to do business in the State of Illinois; and

2)         The employees of the applicant that will be installing, operating, and maintaining generation, transmission, or distribution facilities within the State of Illinois, or any entity with which the applicant has contracted to perform those functions within the State of Illinois, have the requisite knowledge, skills, and competence to perform those functions in a safe and responsible manner in order to provide safe and reliable service in accordance with the criteria stated in Section 16-128(a) of the Act [220 ILCS 5/16-128(a)].

e)         The applicant shall certify compliance with all other applicable laws and regulations and Commission rules and orders.

f)         The applicant shall certify it will procure renewable energy resources as required by Section 16-115D and Section 16-115(d) of the Act, or shall certify that Section 16-115D and Section 16-115(d) do not apply to it pursuant to Section 16-115D(h).

g)         The applicant shall certify that it will source electricity from clean coal facilities, as required by Section 16-115(d)(5) of the Act.

(Source:  Amended at 34 Ill. Reg. 15283, effective September 25, 2010)

Section 451.30  Required Filings and Procedures

a)         The applicant shall publish, as provided by the Notice by Publication Act [715 ILCS 5], notice of its application for certification in the Official State Newspaper within 10 days following the filing of the application for certification. The applicant shall file proof of publication with the Clerk of the Commission within 5 days after publication.

b)         All applications for certification under this Part shall be verified as required by Section 200.130 of the Commission's "Rules of Practice" (83 Ill. Adm. Code 200.130).

c)         The applicant shall identify the geographic area or geographic areas in which the applicant seeks to be authorized to offer service and the types of services it intends to offer. The applicant shall provide the following:

1)         Description of the applicant's business;

2)         Description of the characteristics of customer group or groups applicant proposes to serve; and

3)         Proof that notification of intent to serve in any utility's service area has been previously provided to the agent designated by the electric utility pursuant to 83 Ill. Adm. Code 215.10 of each electric utility in whose service area the applicant intends to serve.

d)         Itemized filing requirements

1)         At the time an ARES files an application for certification under this Part, the applicant shall also file its statement in support of application, supporting documents, and schedules containing information showing that the applicant meets the requirements of Section 16-115 of the Act; and

2)         The applicant shall certify compliance with all terms and conditions required by Sections 16-115A(a), (b), and (f), 16-119, 16-123, 16-125(b) and (c), 16-127, and 16-128(a) of the Act, to the extent those Sections have application to the services being offered by the alternative electric supplier.

e)         Documents shall include the full name, address, telephone number and, unless the applicant has no facsimile number or e-mail address, facsimile number and e-mail address of the applicant.  An applicant shall state whether it agrees to accept service by electronic means as provided for in Section 200.1050 of the Commission's "Rules of Practice" (83 Ill. Adm. Code 200.1050). In addition, documents shall be typewritten or printed on white paper 8½ inches by 11 inches or capable of being printed on white paper 8½ inches by 11 inches and shall have inside text margins of not less than one inch.

f)         The foregoing requirements of this Section shall apply to neither electric cooperatives or municipal systems making an election under Section 17-300 of the Act to become an ARES nor to applicants filing under Section 16-115(e) of the Act.

(Source:  Amended at 34 Ill. Reg. 15283, effective September 25, 2010)

Section 451.40  Customer Records and Information

a)         The applicant shall agree to adopt and follow rules and procedures ensuring that authorizations received from customers, customer billing records, and requests for delivery service transmitted to utilities are retained for a period of not less than two calendar years after the calendar year in which they were created. In addition to other lawful means of discovery, these records shall be made available by request to the Commission or its Staff on a confidential and proprietary basis, as necessary to carry out the Commission's obligations under the Act.

b)         The applicant shall preserve the confidentiality of its customers' data and shall agree to adopt and follow rules and procedures to preserve the confidentiality of its customers' data.

c)         The foregoing requirements of this Section shall apply to neither electric cooperatives nor municipal systems making an election under Section 17-300 of the Act to become an ARES nor to applicants filing under Section 16-115(e) of the Act.

(Source:  Amended at 24 Ill. Reg. 15971, effective October 15, 2000)

Section 451.50  License or Permit Bond Requirements

a)         The applicant shall execute and maintain a license or permit bond issued by a qualifying surety or insurance company authorized to transact business in the State of Illinois in favor of the People of the State of Illinois. The amount of the bond shall equal $30,000 if the applicant seeks to serve only nonresidential retail customers with maximum electrical demands of one megawatt or more, $150,000 if the applicant seeks to serve nonresidential retail customers with annual electrical consumption greater than 15,000 kWh, or $300,000 if the applicant seeks to serve all eligible retail customers. The bond shall be conditioned upon the full and faithful performance of all duties and obligations of the applicant as an ARES and shall be valid for a period of not less than one year. The cost of the bond shall be paid by the applicant. The applicant shall file a copy of this bond, with a notarized verification page from the issuer, as part of its application for certification.

b)         In the event that a license or permit bond is cancelled, expires or is drawn upon, the ARES shall execute and maintain an additional or replacement bond such that the cumulative value of all outstanding bonds never falls below the amount required in subsection (a) of this Section. The ARES shall file a copy of the additional or replacement bond with the Chief Clerk of the Commission and provide a copy to the Financial Analysis Division − ARES or its successor at least 15 days in advance of the effective date of the bond. The filing shall include a cover letter that explains the purpose of the filing and shall be identified by the name of the ARES as it appears in the most recent Commission order granting the ARES certification.

c)         In the event that a license or permit bond is modified, the ARES shall file a copy of the modified bond with the Chief Clerk of the Commission and provide a copy of that bond to the Financial Analysis Division − ARES or its successor at least 15 days in advance of the effective date of the modification. The filing shall include a cover letter titled "Part 451 License or Permit Bond" that explains the purpose of the filing and shall be identified by the name of the ARES as it appears in the most recent Commission order granting the ARES certification.

d)         The requirements of this Section shall apply to neither electric cooperatives nor municipal systems making an election under Section 17-300 of the Act to become an ARES nor to applicants filing under Section 16-115(e) of the Act.

(Source:  Amended at 34 Ill. Reg. 15283, effective September 25, 2010)

Section 451.60  Confidential Documentation

If an applicant or ARES believes any of the information to be disclosed by an applicant or ARES is privileged or confidential, the applicant or ARES should request that the Commission enter an order to protect the confidential, proprietary or trade secret nature of any data, information or studies pursuant to 83 Ill. Adm. Code 200.430. The applicant or ARES shall designate which information is privileged and confidential.  Such information shall be marked as "confidential" and submitted separately under seal to the Chief Clerk of the Commission. The applicant or ARES is required to explain why that information is entitled to that protection in a supporting document pursuant to Section 451.30(d)(1).

(Source:  Added at 24 Ill. Reg. 15971, effective October 15, 2000)

Section 451.100  Applicability of Subpart B

This Subpart shall apply only to the certification of all alternative retail electric suppliers that seek to serve only nonresidential retail customers with maximum electrical demands of one megawatt or more as required by Section 16-115(f) of the Act  except as noted.  The requirements of this Subpart are in addition to the requirements of Subpart A. This Subpart applies to neither electric cooperatives nor municipal systems making an election under Section 17-300 of the Act to become an alternative retail electric supplier.

(Source:  Amended at 34 Ill. Reg. 15283, effective September 25, 2010)

Section 451.110  Financial Qualifications under Subpart B

a)         An applicant shall be deemed to possess sufficient financial capabilities to serve non-residential retail customers with maximum electrical demand of one megawatt or more if the applicant meets any of the following criteria:

1)         The applicant maintains at least one of the following commercial paper ratings: A-2 or higher from Standard & Poor's or its successor, P-2 or higher from Moody's Investors Service or its successor, or F-2 or higher from Fitch Ratings or its successor; or at least one of the following long-term credit ratings: BBB- or higher from Standard & Poor's or its successor, Baa3 or higher from Moody's Investors Service or its successor, or BBB- or higher from Fitch Ratings or its successor. The applicant shall provide with its application a copy of the ratings agency reports that present the ratings of the applicant.

2)         The applicant maintains one or more lines of credit with RTOs and/or unaffiliated wholesale suppliers for electric energy for delivery to the service territories of the utilities for which the applicant is seeking a certificate.

A)        The amount of credit available to the applicant under the credit agreements shall, in aggregate, be no less than the greater of $500,000 or 5% of the amount of the applicant's revenue for its most recently completed 12-month fiscal year. That amount of revenue must appear in the applicant's certified financial statements, or those of the applicant's parent, that have received an accountant's report that certifies those financial statements to be free of material misstatement. If the applicant is using the certified financial statements of its parent, the minimum required amount of credit available under the credit agreements shall be determined using the applicable revenue amount from the segment information section of the certified financial statements of the applicant's parent as follows:

i)          If the applicant is listed separately in the segment information section, the applicant's revenue shall be used; or

ii)         If the segment information section is broken down by operation, or other means, the revenue for the entire segment of which the applicant is part shall be used, unless a certified breakdown of the segment by company is provided.

iii)        In the alternative, the applicant's revenue from sales to Illinois retail customers may be used. In these circumstances, the revenue from sales to Illinois retail customers must be provided in the certified financial statements or in internal documents accompanied by a verified statement from a company officer.

B)        The credit agreement shall be valid for a period of not less than one year.

C)        The applicant shall provide a copy of the following:

i)          A schedule, with references to each input of the calculation, showing the currently available amount of each line of credit, including all deductions resulting from any covenants or other limitations governing each agreement;

ii)         The credit agreements;

iii)        The applicant's certified financial statements, including the accountant's report, or those of the applicant's parent, as applicable;

iv)        If the applicant's revenue from sales to Illinois retail customers is to be used, the applicant must submit certified financial statements that present this information, or internal documents that present this information and a verified statement from a company officer attesting to the accuracy of those internal documents; and

v)         A schedule showing the 5% of revenue calculation, with a reference to the applicant's certified financial statements, certified letter from an officer of the applicant verifying Illinois revenue, or internal documents, as applicable, provided for the revenue input of the calculation.

3)         The applicant demonstrates and certifies it is a member of one or more RTOs and purchases 100% of its physical electric energy from the RTOs for delivery to the service territories of the utilities for which the applicant is seeking a certificate.

4)         The applicant shall execute and maintain an unconditional guarantee, payment bond, or letter of credit that upon failure to comply with its contractual obligations to supply energy to its customers, shall be payable to the People of the State of Illinois.  Any dollar limitation on the unconditional guarantee, payment bond, or letter of credit shall equal not less than the product of 1080 times the applicant's expected peak hourly demand expressed in MWs over the next 12 months times the average of the 45 highest daily market prices of electric energy traded during the previous year. Each February, the Commission shall choose a published price index for electricity for use in this subsection (a)(4).  The daily market price of electric energy shall equal the published price index for electricity traded in Illinois, except in the event that no price index for electricity traded in the State of Illinois is published, then the daily market price of electricity shall be determined by the use of a published price index for electricity traded at the nearest location to the State of Illinois. The unconditional guarantee, payment bond, or letter of credit shall be valid for a period of not less than one year. All payments to be made through the unconditional guarantee, payment bond, or letter of credit under this Section shall be paid in accordance with a Commission Order authorizing such payment.

A)        Unconditional Guarantee. The guarantor shall maintain at least one of the following commercial paper ratings: A-2 or higher from Standard & Poor's or its successor, P-2 or higher from Moody's Investors Service or its successor, or F-2 or higher from Fitch Ratings or its successor; or at least one of the following long-term credit ratings: BBB- or higher from Standard & Poor's or its successor, Baa3 or higher from Moody's Investors Service or its successor, or BBB- or higher from Fitch Ratings or its successor. The applicant shall provide a copy of the following:

i)          The unconditional guarantee;

ii)         The ratings agency report that presents the applicable rating of the guarantor; and

iii)        A good faith estimate of the applicant's expected peak hourly demand expressed in MWs over the next 12 months.

B)        Payment Bond. The payment bond or payment bonds shall be issued by a qualifying surety authorized to transact business in the State of Illinois or by a surety whose Best's rating is A- or better and whose Best's financial size category is VII or larger, and whose contract of insurance is issued pursuant to Section 445 or 445a of the Illinois Insurance Code [215 ILCS 5/445 or 445a] and countersigned by the Surplus Line Association of Illinois or its successor. The applicant shall provide a copy of the following:

i)          The payment bonds or the contract of insurance with the countersignature of the Surplus Line Association of Illinois or its successor as applicable;

ii)         Documentation demonstrating that the surety issuing the payment bond is a qualified surety authorized to transact business in the State of Illinois or a surety with a satisfactory Best's rating and financial size category, as applicable; and

iii)        A good faith estimate of the applicant's expected peak hourly demand expressed in MWs over the next 12 months.

C)        Letter of Credit. The letter of credit shall be irrevocable and issued by a financial institution with a long-term obligation rating of A- or higher from Standard & Poor's or its successor, A3 or higher from Moody's Investors Service or its successor, or A- or higher from Fitch Ratings or its successor. The applicant shall provide a copy of the following:

i)          The letter of credit;

ii)         The ratings agency report that presents the long-term obligation rating of the financial institution extending the credit; and

iii)        A good faith estimate of the applicant's expected peak hourly demand expressed in MWs over the next twelve months.

5)         The applicant maintains a line of credit or revolving credit agreement.

A)        The line of credit or revolving credit agreement must be from a financial institution with a long-term obligation rating of A- or higher from Standard & Poor's or its successor, A3 or higher from Moody's Investors Service or its successor, or A- or higher from Fitch Ratings or its successor.

B)        The amount of the line of credit or revolving credit agreement shall be no less than the greater of $500,000 or 5% of the amount of revenue for the most recently completed 12-month fiscal year. That amount of revenue must appear in the applicant's certified financial statements, or those of the applicant's parent, that have received an accountant's report that certifies those financial statements to be free of material misstatement. If the applicant is using the certified financial statements of its parent, the minimum required amount of credit available under the line of credit or revolving credit agreement shall be determined using the applicable revenue amount from the segment information section of the certified financial statements of the applicant's parent.

i)          If the applicant is listed separately in the segment information section, the applicant's revenue shall be used.

ii)         If the segment information section is broken down by operation, or other means, the revenue for the entire segment of which the applicant is part shall be used, unless a certified breakdown of the segment by company is provided.

C)        The line of credit or revolving credit agreement shall be valid for a period of not less than one year.

D)        The applicant shall provide a copy of the following:

i)          The line of credit or revolving credit agreement;

ii)         The ratings agency report that presents the long-term obligation rating of the financial institution extending the credit;

iii)        The certified financial statements, including the accountant's report, of the applicant or those of the applicant's parent, as applicable; and

iv)        A schedule showing the 5% of revenue calculation, with a reference to the applicant's certified financial statements provided for the revenue input of the calculation.

b)         An applicant that will provide electric power and energy with property, plant, and equipment that it owns, controls, or operates shall have in force, and provide proof that it has in force, general liability insurance that shall remain in effect for a period of not less than one year.

1)         The applicant shall be deemed to have sufficient commercial general liability insurance if that coverage is in the amount of at least $100,000,000.  The commercial general liability insurance must be maintained with insurance companies assigned Best's ratings of A- or better and Best's financial sizes of VII or larger.

2)         The applicant shall provide a certificate of insurance as part of its application for certification.  If the applicant or ARES renews or makes changes in its insurance coverage, the insurance coverage must be continuous and without interruption.  The certificate of insurance and the insurance policies shall contain a provision that coverage afforded under the policies shall not be cancelled, allowed to expire, or subjected to a reduction in the limits in any manner unless at least 30 days prior written notice (10 days notice in the case of nonpayment of premium) has been given to the Commission.

(Source:  Amended at 34 Ill. Reg. 15283, effective September 25, 2010)

Section 451.120  Technical Qualifications under Subpart B

a)         An applicant that uses electric generation, transmission or distribution facilities that it owns, controls, or operates in serving customers shall be deemed to possess sufficient technical capabilities to serve retail customers identified in this Subpart if it maintains a technical staff on duty or on call 24 hours each day to operate and maintain applicant's facilities as needed. The applicant must have at least two individuals on its staff with at least two years operational experience working with an electric generation, transmission or distribution facility that is substantially similar to the facility that the applicant owns, controls or operates in serving customers, and one individual on its staff with at least two years experience buying or selling power and energy in wholesale markets.

b)         Any other applicant shall be deemed to possess sufficient technical capabilities to serve retail customers identified in this Subpart if it has at least one individual on its staff with  at least two years experience buying or selling power and energy in wholesale markets.

c)         The applicant shall include in its application an exhibit that identifies, by name and job title, the persons on its staff, and agents or contractors utilized pursuant to Section 451.140, with the technical experience required under Subpart B. The exhibit shall provide a description of the relevant occupational experience for each person, including a description of the duties and the duration of the duties being used to meet each experience requirement of this Section.

(Source:  Amended at 34 Ill. Reg. 15283, effective September 25, 2010)

Section 451.130  Managerial Qualifications under Subpart B

An applicant shall be deemed to possess sufficient managerial capabilities to serve retail customers identified in this Subpart if it has at least one person  in a management position with three or more years of experience with a business enterprise.

a)         The applicant shall include in its application an exhibit that identifies, by name and job title, the persons on its staff, and agents or contractors utilized pursuant to Section 451.140, with the managerial experience required under Subpart B. The exhibit shall provide a description of the relevant occupational experience for each person, including a description of the duties and the duration of the duties being used to meet each experience requirement of this Section.

b)         The applicant shall include in its application an exhibit containing a corporate organizational chart and indicate the position of the persons or agents who are being used to meet the requirements of this Section.

(Source:  Amended at 34 Ill. Reg. 15283, effective September 25, 2010)

Section 451.140  Qualifications of Agents and Contractors under Subpart B

An applicant may meet the requirements of Sections 451.120 and 451.130 by entering into one or more contracts with others to provide the required experience levels, provided that:

a)         Each agent and contractor on whom the applicant relies to meet Section 451.120 or 451.130 is disclosed in the application;

b)         The applicant shall certify that the agent or contractor will comply with all Sections of Part 451 applicable to the function or functions to be performed by the respective agent or contractor.

(Source:  Amended at 34 Ill. Reg. 15283, effective September 25, 2010)

Section 451.150  Commission Order in Proceedings under Subpart B

The Commission shall issue an order granting or denying an application filed under this Subpart B within 45 days after the date on which a complete application has been filed with the Commission and notice of the application's filing is published in the Official State Newspaper as provided by the Notice by Publication Act [715 ILCS 5].

(Source:  Amended at 34 Ill. Reg. 15283, effective September 25, 2010)

Section 451.160  Confidential Documentation (Repealed)

(Source:  Repealed at 24 Ill. Reg. 15971, effective October 15, 2000)

Section 451.200  Applicability of Subpart C

This Subpart shall apply to the certification of all alternative retail electric suppliers that seek to serve nonresidential retail customers with annual electrical consumption greater than 15,000 kWh.  The requirements in this Subpart are in addition to the requirements of Subpart A.  Sections 451.220 through 451.260 do not apply to electric cooperatives or municipal systems making an election under Section 17-300 of the Act to become an alternative retail electric supplier.

(Source:  Amended at 34 Ill. Reg. 15283, effective September 25, 2010)

Section 451.210  General Qualifications under Subpart C

Applicant shall certify compliance with all terms and conditions required by Section 16-115A(c) of the Act [220 ILCS 5/16-115A(c)].

(Source:  Added at 23 Ill. Reg. 13820, effective December 1, 1999)

Section 451.220  Financial Qualifications under Subpart C

a)         An applicant shall be deemed to possess sufficient financial resources to be certified as an ARES able to serve only nonresidential retail customers with annual electrical consumption in excess of 15,000 kWh if it meets any of the following criteria:

1)         The applicant maintains at least one of the following commercial paper ratings: A-2 or higher from Standard & Poor's or its successor, P-2 or higher from Moody's Investors Service or its successor, or F-2 or higher from Fitch Ratings or its successor; or at least one of the following long-term credit ratings: BBB- or higher from Standard & Poor's or its successor, Baa3 or higher from Moody's Investors Service or its successor, or BBB- or higher from Fitch Ratings or its successor. The applicant shall provide with its application a copy of the ratings agency reports that present the ratings of the applicant.

2)         The applicant maintains one or more lines of credit with RTOs and/or unaffiliated wholesale suppliers for electric energy for delivery to the service territories of the utilities for which the applicant is seeking a certificate.

A)        The amount of credit available to the applicant under the credit agreements shall in aggregate be no less than the greater of $750,000 or 7.5% of the amount of the applicant's revenue for its most recently completed 12-month fiscal year. That amount of revenue must appear in the applicant's certified financial statements, or those of the applicant's parent, that have received an accountant's report that certifies those financial statements to be free of material misstatement. If the applicant is using the certified financial statements of its parent, the minimum required amount of credit available under the credit agreements shall be determined using the applicable revenue amount from the segment information section of the certified financial statements of the applicant's parent, as follows:

i)          If the applicant is listed separately in the segment information section, the applicant's revenue shall be used; or

ii)         If the segment information section is broken down by operation, or other means, the revenue for the entire segment of which the applicant is part shall be used, unless a certified breakdown of the segment by company is provided.

iii)        In the alternative, the applicant's revenue from sales to Illinois retail customers may be used. In these circumstances, the revenue from sales to Illinois retail customers must be provided in the certified financial statements or in internal documents accompanied by a verified statement from a company officer.

B)        The credit agreement shall be valid for a period of not less than one year.

C)        The applicant shall provide a copy of the following:

i)          A schedule with references to each input of the calculation, showing the currently available amount of each line of credit, including all deductions resulting from any covenants or other limitations governing each agreement;

ii)         The credit agreements;

iii)        The certified financial statements, including the accountant's report, of the applicant or those of the applicant's parent, as applicable;

iv)        If the applicant's revenue from sales to Illinois retail customers is to be used, the applicant must submit certified financial statements that present this information, or internal documents that present this information and a verified statement from a company officer attesting to the accuracy of those internal documents; and

v)         A schedule showing the 7.5% of revenue calculation, with a reference to the applicant's certified financial statements, certified letter from an officer of the applicant verifying Illinois revenue, or internal documents, as applicable, provided for the revenue input of the calculation.

3)         The applicant demonstrates and certifies it is a member of one or more RTOs and purchases 100% of its physical electric energy from the RTOs for delivery to the service territories of the utilities for which the applicant is seeking a certificate.

4)         The applicant shall execute and maintain an unconditional guarantee, payment bond, or letter of credit that, upon failure to comply with its contractual obligations to supply energy to its customers, shall be payable to the People of the State of Illinois.  Any dollar limitation on the unconditional guarantee, payment bond, or letter of credit shall equal not less than the product of 1080 times the applicant's expected peak hourly demand expressed in MWs over the next 12 months times the average of the 45 highest daily market prices of electric energy traded during the previous year. Each February, the Commission shall choose a published price index for electricity for use in this subsection (a)(4).  The daily market price of electric energy shall equal the published price index for electricity traded in Illinois, except in the event that no price index for electricity traded in the State of Illinois is published, then the daily market price of electricity shall be determined by the use of a published price index for electricity traded at the nearest location to the State of Illinois. The unconditional guarantee, payment bond, or letter of credit shall be valid for a period of not less than one year.  All payments to be made through the unconditional guarantee, payment bond, or letter of credit under this Section shall be paid in accordance with a Commission Order authorizing the payment.

A)        Unconditional Guarantee. The guarantor shall maintain at least one of the following commercial paper ratings: A-2 or higher from Standard & Poor's or its successor, P-2 or higher from Moody's Investors Service or its successor, or F-2 or higher from Fitch Ratings or its successor; or at least one of the following long-term credit ratings: BBB- or higher from Standard & Poor's or its successor, Baa3 or higher from Moody's Investors Service or its successor, or BBB- or higher from Fitch Ratings or its successor. The applicant shall provide a copy of the following:

i)          The unconditional guarantee;

ii)         The ratings agency report that presents the applicable ratings of the guarantor; and

iii)        A good faith estimate of the applicant's expected peak hourly demand expressed in MWs over the next twelve months.

B)        Payment Bond. The payment bond or payment bonds shall be issued by a qualifying surety authorized to transact business in the State of Illinois or by a surety whose Best's rating is A- or better and whose Best's financial size category is VII or larger, and whose contract of insurance is issued pursuant to Section 445 or 445a of the Illinois Insurance Code [215 ILCS 5/445 or 445a] and countersigned by the Surplus Line Association of Illinois or its successor. The applicant shall provide a copy of the following:

i)          The payment bonds or the contract of insurance with the countersignature of the Surplus Line Association of Illinois or its successor as applicable;

ii)         Documentation demonstrating that the surety issuing the payment bond is a qualified surety authorized to transact business in the State of Illinois or a surety with a satisfactory Best's rating and financial size category, as applicable; and

iii)        A good faith estimate of the applicant's expected peak hourly demand expressed in MWs over the next 12 months.

C)        Letter of Credit. The letter of credit shall be irrevocable and issued by a financial institution with a long-term obligation rating of A- or higher from Standard & Poor's or its successor, A3 or higher from Moody's Investors Service or its successor, or A- or higher from Fitch Ratings or its successor. The applicant shall provide a copy of the following:

i)          The letter of credit;

ii)         The ratings agency report that presents the long-term obligation rating of the financial institution extending the credit; and

iii)        A good faith estimate of the applicant's expected peak hourly demand expressed in MWs over the next 12 months.

5)         The applicant maintains a line of credit or revolving credit agreement.

A)        The line of credit or revolving credit agreement must be from a financial institution with a long-term obligation rating of A- or higher from Standard & Poor's or its successor, A3 or higher from Moody's Investors Service or its successor, or A- or higher from Fitch Ratings or its successor.

B)        The amount of the line of credit or revolving credit agreement shall be no less than the greater of $750,000 or 7.5% of the amount of the applicant's revenue for the most recently completed 12-month fiscal year. That amount of revenue must appear in the applicant's certified financial statements, or those of the applicant's parent, that have received an accountant's report that certifies those financial statements to be free of material misstatement. If the applicant is using the certified financial statements of its parent, the minimum required amount of credit available under the line of credit or revolving credit agreement shall be determined using the applicable revenue amount from the segment information section of the certified financial statements of the applicant's parent.

i)          If the applicant is listed separately in the segment information section, the applicant's revenue shall be used.

ii)         If the segment information section is broken down by operation, or other means, the revenue for the entire segment of which the applicant is part shall be used, unless a certified breakdown of the segment by company is provided.

C)        The line of credit or revolving credit agreement shall be valid for a period of not less than one year.

D)        The applicant shall provide a copy of the following:

i)          The line of credit or revolving credit agreement;

ii)         The ratings agency report that presents the long-term obligation rating of the financial institution extending the credit;

iii)        The certified financial statements, including the accountant's report, of the applicant or those of the applicant's parent, as applicable; and

iv)        A schedule showing the 7.5% of revenue calculation, with a reference to the applicant's certified financial statements provided for the revenue input of the calculation.

b)         An applicant that does not either meet or qualify for certification under any of the criteria set forth in subsection (a) shall describe its financial resources and explain why those financial resources are sufficient for the goods and services it seeks to provide.  If the applicant's financial resources are not sufficient for the services it seeks to provide or if the financial documents do not otherwise establish that the applicant possesses adequate financial resources to provide the service for which it seeks a certificate of service authority, the Commission shall deny granting that certificate of service authority.  In its application, the applicant shall provide the following:

1)         An explanation of how its supporting documentation demonstrates that its financial resources are sufficient for the goods and services it seeks to provide; and

2)         The applicant's certified financial statements, or those of its parent if the segment information contained in the parent's financial statements is sufficiently detailed to establish the adequacy of the applicant's financial resources, and accountant's report. If the applicant does not have certified financial statements and an accountant's report, the applicant shall provide all of the following:

A)        A balance sheet that reflects the applicant's current financial condition and includes a statement of assets, liabilities and owner's equity;

B)        An income statement that reflects the applicant's current earnings.  If the applicant has not yet started operations, it shall provide a projected income statement;

C)        A listing of shareholders, owners, partners or proprietors with ownership interests in excess of 5% and the amount of their respective ownership interests;

D)        A listing of any entities with which the applicant expects to enter into a contract within the next 12 months concerning the provision of electric power or energy, or the delivery or furnishing of electric power or energy, to retail customers;

E)        Copies of all contracts with outside contractors and with all affiliated entities concerning the provision of electric power or energy, or the delivery or furnishing of electric power or energy, to retail customers;

F)         A projected budget for the next three fiscal years following the current year; and

G)        If available:

i)          Unaudited financial statements (for the most recent period available) including any compilation or review opinions;

ii)         The most recent federal and state income tax return;

iii)        General ledgers for the most recent 12 month period available; and

iv)        The applicant's Dun & Bradstreet Business Information Report.

(Source:  Amended at 34 Ill. Reg. 15283, effective September 25, 2010)

Section 451.230  Technical Qualifications under Subpart C

a)         An applicant that uses electric generation, transmission or distribution facilities that it owns, controls, or operates in serving customers shall be deemed to possess sufficient technical capabilities to serve retail customers identified in this Subpart if it maintains at least two technical staff on duty or on call 24 hours each day to operate and maintain applicant's facilities as needed.  The technical staff must have at least two years of technical operational experience working with an electric generation, transmission or distribution facility that is substantially similar to the facility that the applicant owns, controls or operates in serving customers, and meet the criteria in subsections (b) and (c) of this Section.

b)         An applicant shall be deemed to possess sufficient technical capabilities to serve retail customers identified in this Subpart if it has at least one individual on its staff with two years experience buying and selling power and energy in wholesale markets, and six months of scheduling experience working for an entity that is either a member of PJM, a market participant in the Midwest ISO, or has a system operator certificate from NERC, or has earned Certified Energy Procurement Professional status by the Association of Energy Engineers or equivalent certification.

c)         The applicant shall designate in its application, and shall agree thereafter to maintain, a telephone number, fax number and address where its staff can be directly reached at all times. Maintenance of an answering service or machine, pager or similar message-taking procedure does not satisfy this requirement.

d)         The applicant shall include in its application an exhibit that identifies, by name and job title, the persons on its staff, and agents or contractors utilized pursuant to Section 451.250, with the technical experience required under this Subpart C. The exhibit shall provide a description of the relevant occupational experience for each person, including a description of the duties and the duration of the duties being used to meet each experience requirement of this Section.

e)         In the event the applicant does not meet length of experience qualifications set forth in this Section, the applicant shall demonstrate the extent its technical resources and abilities match the services that it intends to provide to its customers. The Commission may impose such terms and conditions as it deems necessary in order to insure the applicant is technically qualified, commensurate with the anticipated scope of the service to be provided and customers to be served.

(Source:  Amended at 34 Ill. Reg. 15283, effective September 25, 2010)

Section 451.240  Managerial Qualifications under Subpart C

An applicant shall be deemed to possess sufficient managerial capabilities to serve customers identified in this Subpart if it has at least one person in a management position with four or more years experience with enterprise financial and administration responsibilities including profit and loss responsibilities and provides the information required in subsections (a) and (b) of this Section.

a)         The applicant shall include in its application an exhibit that identifies, by name and job title, the persons on its staff, and agents or contractors utilized pursuant to Section 451.250, with the managerial experience required under this Subpart C. The exhibit shall provide a description of the relevant occupational experience for each person, including a description of the duties and the duration of the duties being used to meet each experience requirement of this Section.

b)         The applicant shall include in its application an exhibit containing a corporate organizational chart and indicating the position of the persons or agents who are being used to meet the requirements of this Section.

c)         In the event the applicant does not meet the managerial qualifications set forth in this Section, the applicant shall demonstrate the extent its managerial resources and abilities match the services that it intends to provide to its customers. The Commission may impose such terms and conditions as deemed necessary in order to insure the applicant is managerially qualified, commensurate with the anticipated scope of the service to be provided and customers to be served.

(Source:  Amended at 34 Ill. Reg. 15283, effective September 25, 2010)

Section 451.250  Qualifications of Agents and Contractors under Subpart C

An applicant may meet the requirements of Sections 451.230 and 451.240 by entering into one or more contracts with others to provide the required experience levels, provided that:

a)         Each agent and contractor on whom the applicant relies to meet Section 451.230 or 451.240 is disclosed in the application; and

b)         The applicant shall certify that the agent or contractor will comply with all Sections of Part 451 applicable to the function or functions to be performed by the respective agent or contractor.

(Source:  Amended at 34 Ill. Reg. 15283, effective September 25, 2010)

Section 451.260  Commission Order in Proceedings under Subpart C

The Commission shall issue an order granting or denying an application filed under this Subpart C within 45 days after the date on which a complete application has been properly filed with the Commission and notice of the application's filing is published in the Official State Newspaper as provided by the Notice by Publication Act [715 ILCS 5].

(Source:  Amended at 24 Ill. Reg. 15971, effective October 15, 2000)

Section 451.270  Confidential Documentation under Subpart C (Repealed)

(Source:  Repealed at 24 Ill. Reg. 15971, effective October 15, 2000)

Section 451.300  Applicability of Subpart D

Subpart D shall apply to applicants who seek to serve all retail customers.  The requirements of this Subpart are in addition to the requirements of Subpart A.  Sections 451.320 through 451.360 do not apply to electric cooperatives or municipal systems making an election under Section 17-300 of the Act to become an alternative retail electric supplier.

(Source:  Amended at 34 Ill. Reg. 15283, effective September 25, 2010)

Section 451.310  General Provisions of Subpart D

a)         Applicant shall certify compliance with all terms and conditions required by Section 16-115A(c) of the Act.

b)         An applicant that seeks to serve customers within a geographic area that is smaller than an electric utility's service area shall demonstrate that the designation of this smaller area does not violate any part of Section 16-115A of the Act. Applicant shall state in its application for certification any limitations that will be imposed on the number of customers or maximum load to be served and certify that it will not  deny service to a customer or group of customers nor establish any differences as to prices, terms, conditions, services, products, facilities, or in any other respect, whereby such denial or differences are based upon race, gender or income nor deny service to a customer or group of customers based on locality nor establish any unreasonable difference as to prices, terms, conditions, services, products, or facilities as between localities.

c)         The applicant shall submit as part of its application a statement indicating:

1)         Whether the applicant has been denied an electric supplier license in any state in the United States, and for affirmative responses, provide details identifying the name, case number, and jurisdiction of each such action.

2)         Whether the applicant has had an electric supplier license suspended or revoked by any state in the United States, and for affirmative responses, provide details identifying the name, case number, and jurisdiction of each such action.

3)         Where, if any, other electric supplier license applications are pending in the United States.

4)         Whether the applicant is the subject of any lawsuits filed in a court of law or formal complaints filed with a regulatory agency alleging fraud, deception or unfair marketing practices, or other similar allegations, identifying the name, case number, and jurisdiction of each such lawsuit or complaint.  For the purposes of this Section, formal complaints include only those complaints that seek a binding determination from a state or federal regulatory body.

d)         The applicant shall certify that it will comply with the following requirements with respect to the marketing, offering and provision of products or services to residential and small commercial retail customers:

1)         Any marketing materials that make statements concerning prices, terms and conditions of service shall contain information that adequately discloses the prices, terms and conditions of the products or services that the alternative retail electric supplier is offering or selling to the customer.

2)         Before any customer is switched from another supplier, the alternative retail electric supplier shall give the customer written information that adequately discloses, in plain language, the prices, terms and conditions of the products and services being offered and sold to the customer.

3)         An alternative retail electric supplier shall provide documentation to the Commission and to customers that substantiates any claims made by the alternative retail electric supplier regarding the technologies and fuel types used to generate the electricity offered or sold to customers.

4)         The alternative retail electric supplier shall provide to the customer itemized billing statements that describe the products and services provided to the customer and their prices and provide an additional statement, at least annually, that adequately discloses the average monthly prices and the terms and conditions of the products and services sold to the customer.

e)         The applicant shall certify that it will provide the Commission's electric education internet address to all residential and small commercial retail customers pursuant to Section 16-117(g)(2) of the Act.

f)         The applicant shall certify that it will provide to residential and small commercial retail customers, on a semiannual basis, information on how to obtain a list of alternative retail electric suppliers that have been found in the last 3 years by the Commission (pursuant to Section 10-108 of the Act) to have failed to provide service in accordance with the terms of their contracts (pursuant to Section 16-117(g)(4)(C) of the Act).

(Source:  Amended at 43 Ill. Reg. 10450, effective September 3, 2019)

Section 451.320  Financial Qualifications under Subpart D

a)         An applicant shall be deemed to possess sufficient financial resources to be certified as an ARES able to serve all retail customers if it meets any of the following criteria:

1)         The applicant maintains at least one of the following commercial paper ratings: A-2 or higher from Standard & Poor's or its successor, P-2 or higher from Moody's Investors Service or its successor, or F-2 or higher from Fitch Ratings or its successor; or at least one of the following long-term credit ratings: BBB- or higher from Standard & Poor's or its successor, Baa3 or higher from Moody's Investors Service or its successor, or BBB- or higher from Fitch Ratings or its successor. The applicant shall provide with its application a copy of the ratings agency reports that present the ratings of the applicant.

2)         The applicant maintains one or more lines of credit with RTOs and/or unaffiliated wholesale suppliers for electric energy for delivery to the service territories of the utilities for which the applicant is seeking a certificate.

A)        The amount of credit available to the applicant under the credit agreements shall in aggregate be no less than the greater of $1,000,000 or 10% of the amount of the applicant's revenue for its most recently completed 12-month fiscal year. That amount of revenue must appear in the applicant's certified financial statements, or those of the applicant's parent, that have received an accountant's report that certifies those financial statements to be free of material misstatement. If the applicant is using the certified financial statements of its parent, the minimum required amount of credit available under the credit agreements shall be determined using the applicable revenue amount from the segment information section of the certified financial statements of the applicant's parent.

i)          If the applicant is listed separately in the segment information section, the applicant's revenue shall be used; or

ii)         If the segment information section is broken down by operation, or other means, the revenue for the entire segment of which the applicant is part shall be used, unless a certified breakdown of the segment by company is provided; or

iii)        In the alternative, the applicant's revenue from sales to Illinois retail customers may be used. In these circumstances, the revenue from sales to Illinois retail customers must be provided in the certified financial statements or in internal documents accompanied by a verified statement from a company officer.

B)        The credit agreements shall be valid for a period of not less than one year.

C)        The applicant shall provide a copy of the following:

i)          A schedule, with references to each input of the calculation, showing the currently available amount of each line of credit, including all deductions resulting from any covenants or other limitations governing each agreement;

ii)         The credit agreements;

iii)        The certified financial statements, including the accountant's report, of the applicant or those of the applicant's parent, as applicable;

iv)        If the applicant's revenue from sales to Illinois retail customers is to be used, the applicant must submit certified financial statements that present this information, or internal documents that present this information and a verified statement from a company officer attesting to the accuracy of those internal documents; and

v)         A schedule showing the calculation of 10% of revenue with a reference to the applicant's certified financial statements or internal documents, as applicable, provided for the revenue input of the calculation.

3)         The applicant demonstrates and certifies it is a member of one or more RTOs and purchases 100% of its physical electric energy from the RTOs for delivery to the service territories of the utilities for which the applicant is seeking a certificate.

4)         The applicant shall execute and maintain an unconditional guarantee, payment bond, or letter of credit that, upon failure to comply with its contractual obligations to supply energy to its customers, shall be payable to the People of the State of Illinois.  Any dollar limitation on the unconditional guarantee, payment bond, or letter of credit shall equal not less than the product of 1080 times the applicant's expected peak hourly demand expressed in MWs over the next twelve months times the average of the 45 highest daily market prices of electric energy traded during the previous year. Each February, the Commission shall choose a published price index for electricity for use in this subsection (a)(4).  The daily market price of electric energy shall equal the published price index for electricity traded in Illinois, except in the event that no price index for electricity traded in the State of Illinois is published, then the daily market price of electricity shall be determined by the use of a published price index for electricity traded at the nearest location to the State of Illinois. The unconditional guarantee, payment bond, or letter of credit shall be valid for a period of not less than one year.  All payments to be made through the unconditional guarantee, payment bond, or letter of credit under this Section shall be paid in accordance with a Commission Order authorizing the payment.

A)        Unconditional Guarantee. The guarantor shall maintain at least one of the following commercial paper ratings: A-2 or higher from Standard & Poor's or its successor, P-2 or higher from Moody's Investors Service or its successor, or F-2 or higher from Fitch Ratings or its successor; or at least one of the following long-term credit ratings: BBB- or higher from Standard & Poor's or its successor, Baa3 or higher from Moody's Investors Service or its successor, or BBB- or higher from Fitch Ratings or its successor. The applicant shall provide a copy of the following:

i)          The unconditional guarantee;

ii)         The ratings agency report that presents the applicable ratings of the guarantor; and

iii)        A good faith estimate of the applicant's expected peak hourly demand expressed in MWs over the next 12 months.

B)        Payment Bond. The payment bond or payment bonds shall be issued by a qualifying surety authorized to transact business in the State of Illinois or by a surety whose Best's rating is A- or better, whose Best's financial size category is VII or larger, and whose contract of insurance is issued pursuant to Section 445 or 445a of the Illinois Insurance Code and countersigned by the Surplus Line Association of Illinois or its successor. The applicant shall provide a copy of the following:

i)          The payment bonds or the contract of insurance with the countersignature of the Surplus Line Association of Illinois or its successor as applicable;

ii)         Documentation demonstrating that the surety issuing the payment bond is a qualified surety authorized to transact business in the State of Illinois or a surety with a satisfactory Best's rating and financial size category, as applicable; and

iii)        A good faith estimate of the applicant's expected peak hourdly demand expressed in MWs over the next 12 months.

C)        Letter of Credit. The letter of credit shall be irrevocable and issued by a financial institution with a long-term obligation rating of A- or higher from Standard & Poor's or its successor, A3 or higher from Moody's Investors Service or its successor, or A- or higher from Fitch Ratings or its successor. The applicant shall provide a copy of the following:

i)          The letter of credit;

ii)         The ratings agency report that presents the long-term obligation rating of the financial institution extending the credit; and

iii)        A good faith estimate of the applicant's expected peak hourly demand expressed in MWs over the next twelve months.

5)         The applicant maintains a line of credit or revolving credit agreement.

A)        The line of credit or revolving credit agreement must be from a financial institution with a long-term obligation rating of A- or higher from Standard & Poor's or its successor, A3 or higher from Moody's Investors Service or its successor, or A- or higher from Fitch Ratings or its successor.

B)        The amount of the line of credit or revolving credit agreement shall be no less than the greater of $1,000,000 or 10% of the amount of the applicant's revenue for the most recently completed 12-month fiscal year. That amount of revenue must appear in the applicant's certified financial statements, or those of the applicant's parent, that have received an accountant's report that certifies those financial statements to be free of material misstatement. If the applicant is using the certified financial statements of its parent, the minimum required amount of credit available under the line of credit or revolving credit agreement shall be determined using the applicable revenue amount from the segment information section of the certified financial statements of the applicant's parent.

i)          If the applicant is listed separately in the segment information section, the applicant's revenue shall be used.

ii)         If the segment information section is broken down by operation, or other means, the revenue for the entire segment of which the applicant is part shall be used, unless a certified breakdown of the segment by company is provided.

C)        The line of credit or revolving credit agreement shall be valid for a period of not less than one year.

D)        The applicant shall provide a copy of the following:

i)          The line of credit or revolving credit agreement;

ii)         The ratings agency report that presents the long-term obligation rating of the financial institution extending the credit;

iii)        The  certified financial statements, including the accountant's report, of the applicant or those of the applicant's parent, as applicable; and

iv)        A schedule showing the 10% of revenue calculation, with a reference to the applicant's certified financial statements provided for the revenue input of the calculation.

b)         An applicant that does not either meet or qualify for certification under any of the criteria set forth in subsection (a) shall describe its financial resources and explain why those financial resources are sufficient for the goods and services it seeks to provide. If the applicant's financial resources are not sufficient for the services it seeks to provide or if the financial documents do not otherwise establish that the applicant possesses adequate financial resources to provide the service for which it seeks a certificate of service authority, the Commission shall deny granting that certificate of service authority. In its application, the applicant shall provide the following:

1)         An explanation of how its supporting documentation demonstrates that its financial resources are sufficient for the goods and services it seeks to provide; and

2)         The applicant's certified financial statements, or those of its parent if the segment information contained in the parent's financial statements is sufficiently detailed to establish the adequacy of the applicant's financial resources, and accountant's report. If the applicant does not have certified financial statements and an accountant's report, the applicant shall provide all of the following:

A)        A balance sheet that reflects the applicant's current financial condition and includes a statement of assets, liabilities and owner's equity;

B)        An income statement that reflects the applicant's current earnings. If the applicant has not yet started operations, it shall provide a projected income statement;

C)        A listing of shareholders, owners, partners or proprietors with ownership interests in excess of 5% and the amount of their respective ownership interests;

D)        A listing of any entities with which the applicant expects to enter into a contract within the next 12 months concerning the provision of electric power or energy, or the delivery or furnishing of electric power or energy, to retail customers;

E)        Copies of all contracts with outside contractors and with all affiliated entities concerning the provision of electric power or energy, or the delivery or furnishing of electric power or energy, to retail customers;

F)         A projected budget for the next three fiscal years following the current year; and

G)        If available:

i)          Unaudited financial statements (for the most recent period available) including any compilation or review opinions;

ii)         The most recent federal and state income tax return;

iii)        General ledgers for the most recent 12 month period available; and

iv)        The applicant's Dun & Bradstreet Business Information Report.

(Source:  Amended at 34 Ill. Reg. 15283, effective September 25, 2010)

Section 451.330  Technical Qualifications under Subpart D

a)         An applicant that uses electric generation, transmission or distribution facilities that it owns, controls, or operates in serving customers shall be deemed to possess sufficient technical capabilities to serve retail customers identified in this Subpart if it maintains at least two technical staff on duty or on call 24 hours each day to operate and maintain applicant's facilities as needed.  The technical staff must have at least two years of technical operational experience in an electric generation, transmission or distribution facility substantially similar to the facility that the applicant owns, controls or operates in serving customers, and meets the criteria in subsections (b) and (c) of this Section.

b)         An applicant shall be deemed to possess sufficient technical capabilities to serve retail customers identified in this Subpart if it has at least one individual on its staff with at least four years experience buying and selling power and energy in wholesale markets and one year of scheduling experience working for an entity that is either a member of PJM, a market participant in the Midwest ISO, or has a system operator certificate from NERC, or has earned Certified Energy Procurement Professional status by the Association of Energy Engineers or equivalent certification.

c)         The applicant shall designate in its application, and shall agree thereafter to maintain, a telephone number, fax number and address where its staff can be directly reached at all times. Maintenance of an answering service or machine, pager or similar message-taking procedure does not satisfy this requirement.

d)         The applicant shall include in its application an exhibit that identifies, by name and job title, the persons on its staff, and agents or contractors utilized pursuant to Section 451.350, with the technical experience required under Subpart D. The exhibit shall provide a description of the relevant occupational experience for each person, including a description of the duties and the duration of the duties being used to meet each experience requirement of this Section.

e)         In the event the applicant does not meet length of experience qualifications set forth in this Section, the applicant shall demonstrate the extent its technical resources and abilities match the services that it intends to provide to its customers. The Commission may impose such terms and conditions as deemed necessary in order to insure the applicant is technically qualified, commensurate with the anticipated scope of the service to be provided and customers to be served.

(Source:  Amended at 34 Ill. Reg. 15283, effective September 25, 2010)

Section 451.340  Managerial Qualifications under Subpart D

An applicant shall be deemed to possess sufficient managerial capabilities to serve retail customers identified in this Subpart if it has three or more individuals in management positions with four or more years experience with enterprise financial and administration responsibilities including profit and loss responsibilities, four years experience buying and selling power and energy in wholesale markets, and four years electric system operational experience and provides the information required in subsections (a) and (b) of this Section.

a)         The applicant shall include in its application an exhibit that identifies, by name and job title, the persons on its staff, and agents or contractors utilized pursuant to Section 451.350, with the managerial experience required under this Subpart D.  The exhibit shall provide a description of the relevant occupational experience for each person, including a description of the duties and the duration of the duties being used to meet each experience requirement of this Section.

b)         The applicant shall include in its application an exhibit containing a corporate organizational chart and indicating the position of the persons or agents who are being used to meet the requirements of this Section.

c)         In the event the applicant does not meet the managerial qualifications set forth in this Section, the applicant shall demonstrate the extent its managerial resources and abilities match the services that it intends to provide to its customers. The Commission may impose such terms and conditions as deemed necessary in order to insure the applicant is managerially qualified, commensurate with the anticipated scope of the service to be provided and customers to be served.

d)         With respect to serving residential and small commercial retail customers, an alternative retail electric supplier must maintain sufficient managerial resources and abilities to provide the service for which it has a certificate of authority.  In determining the level of managerial resources and abilities that the alternative retail electric supplier must demonstrate, the Commission shall consider the following:

1)         complaints to the Commission by consumers regarding the alternative electric supplier, including those that reflect on the alternative electric supplier's ability to properly manage solicitation and authorization; and

2)         the alternative electric supplier's involvement in the Commission's consumer complaint process, including the resources the alternative electric supplier dedicates to the process and the alternative electric supplier's ability to manage the issues raised by complaints, and the resolutions of the complaints.

(Source:  Amended at 34 Ill. Reg. 15283, effective September 25, 2010)

Section 451.350  Qualifications of Agents and Contractors under Subpart D

An applicant may meet the requirements of Sections 451.330 and 451.340 by entering into one or more contracts with others to provide the required experience levels, provided that:

a)         Each agent and contractor on whom the applicant relies to meet Section 451.330 or 451.340 is disclosed in the application;

b)         The applicant shall certify that the agent or contractor will comply with all Sections of Part 451 applicable to the function or functions to be performed by the respective agent or contractor.

(Source:  Amended at 34 Ill. Reg. 15283, effective September 25, 2010)

Section 451.360  Commission Order in Proceedings under Subpart D

The Commission shall issue an order granting or denying an application filed under this Subpart D within 45 days after the date on which a complete application has been filed with the Commission and notice of the application's filing is published in the Official State Newspaper as provided by the Notice by Publication Act [715 ILCS 5], provided that the Commission can extend the time for considering an application filed under this Subpart D by up to 90 days, and can schedule a hearing on such an application. The Commission shall extend the time for considering an application and schedule a hearing if:

a)         The applicant has proposed limitations on the number of customers or the amount of load to be served;

b)         A party to the application proceeding has formally requested that the Commission hold hearings in a pleading that contains a verified prima facie showing that one or more of the allegations or certifications in the application is false or misleading; or

c)         Other facts or circumstances exist that will necessitate additional time or evidence in order to determine whether a certificate should be issued.

(Source:  Amended at 24 Ill. Reg. 15971, effective October 15, 2000)

Section 451.370  Confidential Documentation under Subpart D (Repealed)

(Source:  Repealed at 24 Ill. Reg. 15971, effective October 15, 2000)

Section 451.400  Applicability of Subpart E

This Subpart shall apply to a retail customer that seeks certification as an ARES to provide electric power and energy exclusively to itself (i.e., the applicant), or to subsidiaries or other corporate affiliates of the applicant that are at separate locations. This includes, but is not limited to, applicants seeking certification pursuant to Section 16-115(e) of the Act.

(Source:  Amended at 34 Ill. Reg. 15283, effective September 25, 2010)

Section 451.410  Required Filings and Procedures under Subpart E

a)         The applicant shall publish, as provided by the Notice of Publication Act [715 ILCS 5], notice of its application for certification in the Official State Newspaper within 10 days following the filing of the application for certification. The applicant shall file proof of publication with the Clerk of the Commission within five days following publication.

b)         All applications for certification under this Part shall be verified as required by Section 200.130 of the Commission's "Rules of Practice" (83 Ill. Adm. Code 200.130).

c)         The applicant shall provide the following:

1)         Applicant's name, street address and phone number.

2)         Description and location of cogeneration or self-generation facilities within the State of Illinois that applicant owns, if any.

3)         Descriptions and locations of retail customers to be serviced by applicant and shall provide a description of the relationship between applicant and retail customers.

d)         The applicant shall verify that it has entered into an agreement with the relevant electric utilities pursuant to Section 16-118.

e)         The applicant shall comply with the requirements of Section 451.20(a).

f)         Contents of documents shall be consistent with Subpart B of the Commission's "Rules of Practice" (83 Ill. Adm. Code 200: Subpart B).

(Source:  Amended at 34 Ill. Reg. 15283, effective September 25, 2010)

Section 451.420  Technical Qualifications under Subpart E

a)         Applicant shall be deemed to possess sufficient technical capabilities to serve nonresidential retail customers under this Subpart if it maintains a technical staff on duty or on call 24 hours each day to operate and maintain applicant's facilities as needed.

b)         The applicant shall designate in its application, and shall agree thereafter to maintain, a telephone number, fax number, and address where its staff can be directly reached at all times. Maintenance of an answering service or machine, pager, or similar message-taking procedure does not satisfy this requirement.

c)         The applicant shall include in its application an exhibit that identifies, by name and job title, the persons on its staff, and agents or contractors utilized pursuant to Section 451.430, with the technical experience required under this Subpart E.  The exhibit shall provide a description of the relevant occupational experience for each person, including a description of the duties and duration of the duties being used to meet each experience requirement of this Section.

(Source:  Amended at 34 Ill. Reg. 15283, effective September 25, 2010)

Section 451.430  Qualifications of Agents and Contractors under Subpart E

An applicant may meet the requirements of Section 451.420 by entering into one or more contracts with others to provide the required experience levels, provided that:

a)         Each agent and contractor on whom the applicant relies to meet Section 451.420 is disclosed in the application; and

b)         The applicant shall certify that the agent or contractor will comply with all Sections of Part 451 applicable to the function or functions to be performed by the respective agent or contractor.

(Source:  Amended at 34 Ill. Reg. 15283, effective September 25, 2010)

Section 451.440  Commission Order in Proceedings under Subpart E

The Commission shall issue an order granting or denying an application filed under this Subpart E within 45 days after the date on which a complete application has been properly filed with the Commission and notice of the application's filing is published in the Official State Newspaper as provided by the Notice by Publication Act [715 ILCS 5].

(Source:  Amended at 24 Ill. Reg. 15971, effective October 15, 2000)

Section 451.450  Confidential Documentation under Subpart E (Repealed)

(Source:  Repealed at 24 Ill. Reg. 15971, effective October 15, 2000)

Section 451.500  Applicability of Subpart F

The requirements of this Subpart are in addition to the requirements of Subpart A.  This Subpart does not apply to electric cooperatives or municipal systems making an election under Section 17-300 of the Act to become an alternative retail electric supplier.

(Source:  Amended at 24 Ill. Reg. 15971, effective October 15, 2000)

Section 451.510  Financial Qualifications under Subpart F

An applicant may request authorization from the Commission to provide single billing services at the time it seeks certification as an ARES or at any time thereafter.  However, under no circumstances may an ARES provide single billing services without authorization from the Commission. An applicant that seeks to provide single billing services shall demonstrate an ability to establish and maintain sufficient financial resources to satisfy the obligation to remit to utilities monies that the ARES collects under single billing tariffs adopted pursuant to Section 16-118(b) of the Act. The applicant for single billing services may demonstrate this credit worthiness in one of four ways:

a)         The applicant may undertake to post and maintain a bond or bonds issued by a qualifying surety or financial institution chartered by the United States or the State of Illinois in favor of any Illinois utility in whose service territory the applicant will serve retail customers.  The bond or bonds shall be in an amount equal to 15% of a good faith estimate of the total amount that the applicant expects to be obliged to pay to the utility under single billing tariffs adopted pursuant to Section 16-118(b) of the Act during the next twelve months.  The applicant shall provide a copy of the bonding agreements and the bonds to the Commission with the application to provide single billing service.  The bonds shall be conditioned on the full and timely payment of all amounts due to the utility in accordance with the terms specified in the single billing tariffs and shall be valid for a period of not less than one year.

b)         The applicant may deliver an irrevocable letter of credit issued by a financial institution with a long-term obligation rating of A- or higher from Standard & Poor's or its successor, A3 or higher from Moody's Investors Service or its successor, or A- or higher from Fitch Ratings or its successor in the same amount and in favor of the same parties as the bond that would otherwise be required.  The letter of credit shall provide that a draft will be honored in accordance with the terms specified in the single billing tariffs.  The letter of credit shall be valid for a period of not less than one year.  The applicant shall provide a copy of the letter of credit and the ratings agency reports that present the long-term obligation ratings of the issuer of the letter of credit to the Commission with the application to provide single billing service.

c)         The applicant maintains at least 2 of the following commercial paper ratings: A-2 or higher from Standard & Poor's or its successor, P-2 or higher from Moody's Investors Service or its successor, or F-2 or higher from Fitch Ratings or its successor; or at least two of the following long-term credit ratings: BBB- or higher from Standard & Poor's or its successor, Baa3 or higher from Moody's Investors Service or its successor, or BBB- or higher from Fitch Ratings or its successor.  The applicant shall provide a copy of the ratings agency reports that present applicant's ratings to the Commission with its application to provide single billing service.

d)         All obligations of the applicant to Illinois utilities are unconditionally guaranteed by a counterparty that maintains at least two of the following commercial paper ratings: A-2 or higher from Standard & Poor's or its successor, P-2 or higher from Moody's Investors Service or its successor, or F-2 or higher from Fitch Ratings or its successor; or at least two of the following long-term credit ratings: BBB- or higher from Standard & Poor's or its successor, Baa3 or higher from Moody's Investors Service or its successor, or BBB- or higher from Fitch Ratings or its successor.  The unconditional guarantee shall be valid for a period of not less than one year. The applicant shall provide a copy of the ratings agency reports that presents these ratings of the counterparty and a copy of the guarantee to the Commission with its application.

(Source:  Amended at 34 Ill. Reg. 15283, effective September 25, 2010)

Section 451.700  Applicability of Subpart H

The requirements of this Subpart are in addition to the requirements of Subpart A. This Subpart does not apply to electric cooperatives or municipal systems making an election under Section 17-300 of the Act to become an alternative retail electric supplier.

(Source:  Added at 24 Ill. Reg. 15971, effective October 15, 2000)

Section 451.710  General Provisions

a)         All ARES shall, at all times, continue to remain in compliance with the provisions of the Act and this Part, as now or hereafter amended. If an ARES received a certificate before the effective date of any provision of this Part that applies to applicants seeking certification to serve customers with the same electrical demand or usage characteristics as the ARES, the ARES must demonstrate that it has come into compliance with that provision no later than April 30 of the year following the year during which the amendment took effect.

b)         No later than April 30 of each year, each ARES shall file all reports required under this Subpart.  Reports shall be under oath, contain a cover letter title "Part 451 Continuing Compliance" and be filed with the Chief Clerk of the Commission with copies provided to the Energy Division-ARES and the Financial Analysis Division-ARES or their successors. The reports shall be identified with the name of the ARES as it appears in the most recent Commission order granting the ARES certification, as well as any post-certification name changes.  Entities required to file reports and to submit copies under this subsection (b) may do so electronically upon notification by the Chief Clerk of the Commission, on the Commission's website, of the availability of electronic filing for reports filed under this Part 451.

c)         For each supporting piece of documentation the ARES provides, it shall specifically state how this information complies with each applicable subsection of this Part 451.

d)         All reports shall provide the name, telephone number, email address and mailing address of at least one person to address questions from Commission Staff pertaining to that report.

e)         All reports made to the Commission by any ARES, other than ARES certified under Subpart E, and the contents of the reports shall be open to public inspection, unless otherwise ordered by the Commission. The reports shall be preserved in the office of the Commission.

f)         Any ARES acquiring customers from another ARES shall report any such purchase or transfer of customer accounts no later than 30 days after the execution of the transaction. Any ARES receiving customer accounts from another ARES shall be responsible to demonstrate its ability to meet the applicable financial, managerial and technical requirements.

g)         The compliance filing shall include the applicant's name and street address and the names and addresses of all the ARES's affiliated companies involved in electric retail sales or purchases in North America.

(Source:  Amended at 43 Ill. Reg. 10450, effective September 3, 2019)

Section 451.720  Erroneous or Defective Reports

a)         When any report is erroneous or defective or appears to the Commission to be erroneous or defective, the Commission may notify the ARES to amend that report within 30 days after that notice, and before or after the termination of the period the Commission may examine the officers, agents, or employees, and books, records, accounts, vouchers, plant, equipment and property of the ARES, and correct items in the report the Commission finds defective or erroneous.

b)         Any ARES that fails to make and file any report required by the Commission within the time specified, or to specifically answer any question propounded by the Commission within 30 days after the time it is lawfully required to do so, or within such further time, not to exceed 90 days, as may in its discretion be allowed by the Commission, shall, after notice and hearing forfeit its certificate.

(Source:  Amended at 34 Ill. Reg. 15283, effective September 25, 2010)

Section 451.730  Certification of Compliance with Section 16-115(d)(5) of the Act (Repealed)

(Source:  Repealed at 32 Ill. Reg. 17126, effective November 1, 2008)

Section 451.740  Financial Reporting Requirements

The ARES shall provide a copy of only those documents that the ARES requires to demonstrate that it continues to possess sufficient financial resources to serve the retail customers for which it has received a certificate of service authority. The applicable documents shall be submitted at the times specified below:

a)         An ARES that seeks to demonstrate that it maintains sufficient financial resources to provide the services for which it has received a certificate of service authority using the criteria set forth in subsection (a)(1),  (a)(4) or (a)(5) of Section 451.110, 451.220 or 451.320 or Section 451.510(b), (c) or (d) shall submit a copy of the latest ratings report presenting the commercial paper or long-term credit or obligation ratings of the ARES, creditors or guarantors, as applicable, from the ratings agencies between April 1 and April 30 of each year and within 15 days following any downgrade of such ratings previously filed with the Commission to a rating below A-1 or A-, if issued from Standard & Poor's or its successor, P-1 or A3, if issued from Moody's Investors Service or its successor, or F-1 or A-, if issued from Fitch Ratings or its successor.  Within 30 days after a downgrade of the commercial paper or long-term credit or obligation ratings of the ARES or its creditors, affiliates, or guarantors, as applicable, to a level below the minimum required under this Part, the ARES shall submit a report that identifies the subsection under which the ARES is seeking to demonstrate that its financial resources remain sufficient for providing the services for which it has received a certificate of service authority and includes the information and documents that subsection requires.

b)         An ARES that seeks to demonstrate that it maintains sufficient financial resources to provide the services for which it has received a certificate of service authority using the criteria set forth in subsection (a)(2),  (a)(4) or (a)(5) of Section 451.110, 451.220 or 451.320 or Section 451.510(a) or (b) shall submit a copy of any modified, replacement or additional credit agreements; unconditional guarantees; lines of credit; revolving credit agreements; payment bonds; and letters of credit, as applicable.  This documentation shall be submitted at least 15 days in advance of any modification, cancellation or expiration of the financial agreements.

c)         Between April 1 and April 30 of each year, an ARES that seeks to use the criteria specified in Section 451.110(a)(4), 451.220(a)(4), or 451.320(a)(4) to demonstrate that it maintains sufficient financial resources to provide the services for which it has received a certificate of service authority shall provide the peak hourly demand expressed in MWsscheduled during the previous calendar year and the date on which that amount was scheduled, as well as the applicant's expected peak hourly demand expressed in MWs over the next 12 months.

d)         Between April 1 and April 30 of each year, an ARES that seeks to demonstrate that it maintains sufficient financial resources to provide single billing services under Section 451.510(a) or (b) shall submit an updated good faith estimate of the amount the ARES expects to be obligated to remit to the utility under single billing tariffs adopted pursuant to Section 16-118(b) of the Act between April 1 and April 30 of each year.

e)         An ARES that seeks to demonstrate that it maintains sufficient financial resources to provide the services for which it has received a certificate of service authority using the criteria set forth in subsection (a)(2) or (a)(5) of Section 451.110, 451.220, or 451.320 shall submit a copy of its certified financial statements, or those of its parent, and accountant's report, as applicable, within 120 days after the close of its fiscal year.

f)         An ARES that seeks to maintain its certificate of service authority under Section 451.220(b) or 451.320(b) shall submit an updated version of the annual financial statements and accountant's report, if available, within 120 days after the close of its fiscal year.

g)         An ARES that seeks to demonstrate that it maintains sufficient financial resources to provide the services for which it has received a certificate of service authority using the criteria set forth in subsection (a)(2) of Section 451.110, 451.220 or 451.320 shall provide

1)         A copy of the security or agreement that was provided and approved by the RTO used to serve as collateral for the energy the applicant procures from generation asset owners directly through the RTO, including any updates, revisions or modifications that may occur, within 15 days after filing the document with the RTO.

2)         Using the alternative method, the applicant's revenue from sales to Illinois retail customers may be used. In these circumstances, the revenue from sales to Illinois retail customers must be provided in the certified financial statements or in internal documents accompanied by a verified statement from a company officer.

h)         An ARES that seeks to demonstrate that it maintains sufficient financial resources to provide the services for which it has received a certificate of service authority using the criteria set forth in subsection (a)(3) of Section 451.110, 451.220 or 451.320 shall demonstrate and certify it is a member of one or more RTOs and purchases 100% of its physical electric energy from the RTOs for delivery to the service territories of the utilities for which the applicant is seeking a certificate.

i)          Each ARES is required to certify that the most recent copy of its license or permit bond on file with the Commission is current and in full effect. In the event the original license or permit bond on file with the Commission is replaced or modified, the ARES shall submit the new copy of its license or permit bond pursuant to Section 451.50.

j)          Insurance.  Between April 1 and April 30 of each year, an ARES required to have in force commercial general liability insurance pursuant to Section 451.110(b) shall submit proof of that insurance in an amount not less than that in force when the ARES was granted its certificate of service authority.  In addition, the ARES shall demonstrate that its commercial general liability insurance is effective for a period of not less than one year.

(Source:  Amended at 34 Ill. Reg. 15283, effective September 25, 2010)

Section 451.750  Managerial Reporting Requirements

a)         An ARES shall certify during April of each year that it continues to maintain the required managerial qualifications for the service authority granted in its certificate.  An ARES that meets the managerial qualifications requirements by entering into one or more contracts with others to provide the required services must identify each agent or contractor on whom the ARES relies to meet the requirements of this Part and must certify that the agent or contractor will comply with all Sections of this Part applicable to the function or functions to be performed by the respective agent or contractor.

b)         Any changes in personnel, agents or contractors in the past calendar year that were used to meet the managerial qualifications shall be addressed in the annual compliance filing by providing evidence showing how the ARES is continuing to meet the managerial qualifications.

(Source:  Amended at 34 Ill. Reg. 15283, effective September 25, 2010)

Section 451.760  Technical Reporting Requirements

a)         An ARES shall certify during April of each year that it continues to maintain the required technical qualifications for the service authority granted in its certificate.  An ARES that meets the technical qualifications requirements by entering into one or more contracts with others to provide the required services must identify each agent or contractor on whom the ARES relies to meet the requirements of this Part and must certify that the agent or contractor will comply with all Sections of this Part applicable to the function or functions to be performed by the respective agent or contractor.

b)         Any changes in personnel, agents or contractors in the past calendar year that were used to meet the technical qualifications shall be addressed in the annual compliance filing by providing evidence showing how the ARES is continuing to meet the technical qualifications.

(Source:  Amended at 34 Ill. Reg. 15283, effective September 25, 2010)

Section 451.770  Kilowatt-hour Reporting Requirement

No later than March 1 of every year, each ARES shall file with the Chief Clerk of the Commission, and provide to the Energy Division − ARES and the Financial Analysis Division – ARES or their successors, a report stating the total annual kilowatt-hours delivered and sold to retail customers within each utility service territory and the total annual kWh delivered and sold to retail customers in all utility service territories in the preceding calendar year.

(Source:  Amended at 34 Ill. Reg. 15283, effective September 25, 2010)