Minimum Ethanol Blending Commitment Clause Samples
The Minimum Ethanol Blending Commitment clause requires a party, typically a fuel supplier or distributor, to blend a specified minimum percentage or volume of ethanol into their fuel products. In practice, this clause sets a clear threshold for ethanol content that must be met in all relevant fuel blends, often referencing regulatory standards or contractual targets. By establishing this minimum blending requirement, the clause ensures compliance with renewable energy mandates, supports environmental objectives, and provides certainty to both parties regarding fuel composition obligations.
Minimum Ethanol Blending Commitment. (a) During each Calendar Quarter, Company shall tender for blending with gasoline, and Carrier shall blend, a volume of ethanol equal to 10% of the total volume of Company’s blended gasoline delivered at the Pasadena Terminal truck rack during such Calendar Quarter, in approximately ratable quantities (such volume, the “Minimum Quarterly Ethanol Commitment”), and for each Barrel of ethanol blended into gasoline, Company shall pay the “Ethanol Blending” fee determined in accordance with Exhibit B. Company shall provide any ethanol required for Carrier to discharge its obligations under this Section 3.02.
(b) If Company fails to meet its Minimum Quarterly Ethanol Commitment during any Calendar Quarter, then Company will pay Carrier a deficiency payment (each, an “Ethanol Blending Deficiency Payment”) in an amount equal to the volume of the deficiency multiplied by the “Ethanol Blending” fee determined in accordance with Exhibit B.
(c) The dollar amount of any Ethanol Blending Deficiency Payment paid by Company may be applied as a credit against any amounts incurred by Company and owed to Carrier with respect to volumes of ethanol blended in excess of Company’s Minimum Quarterly Ethanol Commitment (or, if this Agreement expires or is terminated, to volumes that would have been in excess of Company’s Minimum Quarterly Ethanol Commitment if this Agreement were still in effect) during any of the succeeding four Calendar Quarters, after which time any unused credits will expire. This Section 3.02(c) shall survive the expiration or termination of this Agreement.
(d) Carrier shall provide ethanol blending services in addition to Company’s Minimum Quarterly Ethanol Commitment on an “as available” basis, at the “Ethanol Blending” fee determined in accordance with Exhibit B.
(e) Carrier’s and Company’s obligations under this Section 3.02 shall terminate immediately upon any change of Law that results in Company no longer being required to blend renewable fuel into gasoline offered for sale in the United States. TERMS IN THIS EXHIBIT HAVE BEEN REDACTED BECAUSE CONFIDENTIAL TREATMENT FOR THOSE TERMS HAS BEEN REQUESTED. THE REDACTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION, AND THE TERMS HAVE BEEN MARKED AT THE APPROPRIATE PLACE WITH TWO ASTERISKS (**).