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NOTICE DATE:  April 13, 2018

NOTICE TYPE:  M-B041318-01 Financial/Credit

SHORT DESCRIPTION:  Reminder - letter of credit issuer limits

INTENDED AUDIENCE:  ERCOT Counter-Parties

DAY AFFECTED:  April 13, 2018

LONG DESCRIPTION:  ERCOT Protocol Section 16.11.3, Alternative Means of Satisfying ERCOT Creditworthiness Requirements, incorporates letter of credit issuer limits determined by the long-term issuer rating and the Tangible Net Worth of the issuer.  Issuer limits are updated each Bank Business Day and are available in the Letter of Credit Concentration Limits Report<http://mis.ercot.com/misapp/GetReports.do?reportTypeId=13218&reportTitle=The%20Letter%20of%20Credit%20Concentration%20Limits%20Report&showHTMLView=&mimicKey> on the ERCOT website.

If a letter of credit issuer limit is breached, Counter-Parties utilizing that issuer will be notified and no new letters of credit from the issuer will be accepted while the limit remains breached.  After four months of the limit in breach, ERCOT will no longer accept new letters of credit or amendments to existing letters of credit from that issuer.

To avoid situations in which a letter of credit may not be accepted, ERCOT reminds Counter-Parties to maintain awareness of current letter of credit issuer limits and maintain collateral availability accordingly.

CONTACT:  If you have any questions, please contact your ERCOT Account Manager. You may also call the general ERCOT Client Services phone number at (512) 248-3900 or contact ERCOT Client Services via email at [log in to unmask]<mailto:[log in to unmask]>.

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