Template:Nutshell EUA Annex Delivering Party’s Replacement Cost: Difference between revisions
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'''{{euaprov|Delivering Party’s Replacement Cost}}''' means for {{euaprov|Receiving Party}}’s failure to accept delivery of a number of {{euaprov|Allowances}} (the “'''{{euaprov|DPRC Shortfall}}'''”): | '''{{euaprov|Delivering Party’s Replacement Cost}}''' means for {{euaprov|Receiving Party}}’s failure to accept delivery of a number of {{euaprov|Allowances}} (the “'''{{euaprov|DPRC Shortfall}}'''”) the following amount: | ||
: | ''(AP + Cost of Carry - EUA<sub>spot</sub> x {{euaprov|DPRC Shortfall}}) + Default Interest'' | ||
Where: | |||
“'''AP'''” = relevant {{euaprov|Allowance Purchase Price}}/{{euaprov|Allowance Strike Price}} <br> | |||
“'''Cost of Carry'''” = Where the parties’ “{{euaprov|Physical Settlement}}” obligations are terminated following a {{euaprov|Suspension Event}}, the {{euaprov|Close-out Cost of Carry Amount}}. <br> | |||
“'''EUA<sub>spot</sub>'''” = the price per {{euaprov|Allowance}} the {{euaprov|Calculation Agent}} determines {{euaprov|Delivering Party}}, would reasonably receive in an arm’s length spot transaction on the {{euaprov|Final Compliance Date}} for the same number of equivalent {{euaprov|Allowances}} to be delivered on the later of the {{euaprov|Final Compliance Date}} and the normal {{euaprov|Delivery Business Day}} for settlement of {{euaprov|Allowances}} under such a transaction. <br> | |||
“'''DPRC Shortfall'''” = as defined above. <br> | |||
“'''Default Interest'''” = interest at the {{euaprov|Default Rate}} from the {{euaprov|Delivery Date}} to the termination date per Part {{euaprov|(d)(ii)}}(2)(B)(''{{euaprov|Failure to Comply Not Remedied}}'') on {{euaprov|DPRC Shortfall}} x any excess of the AP over EUA<sub>spot</sub>. | |||
Latest revision as of 16:30, 12 July 2022
Delivering Party’s Replacement Cost means for Receiving Party’s failure to accept delivery of a number of Allowances (the “DPRC Shortfall”) the following amount:
(AP + Cost of Carry - EUAspot x DPRC Shortfall) + Default Interest
Where:
“AP” = relevant Allowance Purchase Price/Allowance Strike Price
“Cost of Carry” = Where the parties’ “Physical Settlement” obligations are terminated following a Suspension Event, the Close-out Cost of Carry Amount.
“EUAspot” = the price per Allowance the Calculation Agent determines Delivering Party, would reasonably receive in an arm’s length spot transaction on the Final Compliance Date for the same number of equivalent Allowances to be delivered on the later of the Final Compliance Date and the normal Delivery Business Day for settlement of Allowances under such a transaction.
“DPRC Shortfall” = as defined above.
“Default Interest” = interest at the Default Rate from the Delivery Date to the termination date per Part (d)(ii)(2)(B)(Failure to Comply Not Remedied) on DPRC Shortfall x any excess of the AP over EUAspot.