EXHIBIT J
Transmission and Distribution Support Agreement
This Agreement for the support of transmission and
distribution services is entered into this ____ day of _________,
1996, by and between XXXX Transmission Services, Inc. (XXXX
Trans), a Massachusetts corporation, New England Power Company
(NEP), a Massachusetts corporation, Massachusetts Electric Company
(MECO), a Massachusetts corporation, The Narragansett Electric
Company (NECO), a Rhode Island corporation, and Granite State
Electric Company (GSE), a New Hampshire corporation. XXXX Trans
is a newly created subsidiary of the New England Electric System.
NEP, MECO, NECO and GSE are also subsidiaries of the New England
Electric System and are affiliates of XXXX Trans. MECO, NECO, and
GSE are collectively referred to as the Distribution Affiliates.
I. Basic Understandings and Purpose
To respond to the Federal Energy Regulatory Commission's
comparable transmission service policies, XXXX Trans has been
created to provide transmission services over (i) facilities owned
and controlled by NEP, and (ii) facilities of others where such
facilities are integrated with NEP's transmission facilities and
NEP holds contractual rights for their use. XXXX Trans, under
this Agreement, will manage the use of NEP, MECO, NECO, and GSE's
facilities and entitlements as set forth herein to provide
Wholesale Transmission Service. XXXX Trans will pay charges to
support the costs of those facilities and entitlements, and will
make those facilities available to its affiliated companies and to
unaffiliated wholesale transmission customers on
nondiscriminatory and comparable terms. For XXXX Trans to be able
to provide these services it must have control of the transmission
capabilities currently subject to NEP's control. Additionally it
must have rights to use the Distribution Affiliates' distribution
system in order to efficiently provide complete transmission
service for certain wholesale transactions. This Agreement sets
forth the terms and conditions of the transfer of control of NEP's
transmission system and contract rights to XXXX Trans, and
provides for XXXX Trans to use the Distribution Affiliates'
systems for the purpose of providing Wholesale Transmission
Services.
II. Definitions
"Distribution Service" shall mean the transmission of
electric power either (i) from the point of interconnection of
facilities controlled by XXXX Trans with facilities of a
Distribution Affiliate to a wholesale transmission customer of
XXXX Trans interconnected with the facilities of the Distribution
Affiliate, or (ii) from generation resources transmitted across
facilities of a Distribution Affiliate to the point of
interconnection with facilities controlled by XXXX Trans.
"Distribution System" shall mean those facilities which are
owned or supported by a Distribution Affiliate and are not NEP
Transmission Facilities.
"FERC" is the Federal Energy Regulatory Commission or its
successor agency having regulatory jurisdiction over this
Agreement.
"XXXX Trans Tariffs" shall mean the Point-to-Point
Transmission Service Tariff and the Network Integration
Transmission Service Tariff filed and maintained by XXXX Trans.
"NEP Transmission Facilities" shall mean all facilities,
including ancillary facilities, owned by NEP or owned by the
Distribution Affiliates and made available to NEP pursuant to
Integrated Facilities Schedule III-B of NEP's Tariff No. 1, and
which are used for transmitting electricity between the point of
connection:
i) of the generator radial with the transmission
network, or if there is no radial, the high voltage side
of the generation stepup transformers; or
ii) with transmission facilities owned by others;
and:
i) the point of interconnection with distribution
facilities; or
ii) the point of interconnection with transmission
facilities owned by others.
In addition, the Combined Use GSU/115kV/345kV transformer
associated with NEP's Xxxxxxx Xxxxx Xxxx 0 located in Somerset,
Massachusetts, will be included in the NEP Transmission
Facilities.
"NEP Transmission Entitlements" shall mean contractual
entitlements to electric transmission services over facilities
owned by others, supported in whole or in part by NEP,
interconnected with NEP Transmission Facilities or facilities of
others that are interconnected with NEP Transmission Facilities,
and over which NEP has:
i) general wheeling rights; or
ii) rights to integrate remote all-requirements loads
served pursuant to NEP's Tariff No. 1 with NEP's power
supply resources.
Contracts that include NEP Transmission Entitlements are set
forth in Schedule A. To the extent that contracts listed in
Schedule A also include some rights that are not within the scope
of the foregoing definition, only those rights within such
contracts that are consistent with this definition shall qualify
as NEP Transmission Entitlements.
"NEP Transmission Obligations" shall mean obligations to
others to provide transmission- related services over facilities
owned by NEP. Contracts that include NEP Transmission Obligations
are set forth in Schedule C. To the extent contracts listed in
Schedule C also include some obligations that are not
transmission-related services, only those obligations within such
contracts that are transmission-related services shall qualify as
NEP Transmission Obligations. Transmission-related services shall
not include generation related services, such as provision of
reactive power.
"Prudent Utility Practice" shall mean any of the practices,
methods and acts that, in the exercise of reasonable judgment in
the light of the facts known at the time, could have been expected
to accomplish the desired result at reasonable cost consistent
with reliability, safety, environmental protection, expedition and
the requirements of governmental agencies having jurisdiction.
Prudent Utility Practices are not intended to be limited to any
particular set of optimum practices, methods or acts to the
exclusion of all others, but rather are intended to include a
range of possible practices, methods or acts consistent with the
above stated criteria.
"Retail Transmission Service" shall mean all transmission
service that is not Wholesale Transmission Service, including
transmission service delivering electricity to ultimate customers.
"Tariff No. 1" shall mean NEP's FERC Electric Tariff,
Original Volume No. 1 as amended from time to time.
"Wholesale Transmission Service" shall mean transmission
service for wholesale transactions, as authorized under the
Federal Power Act and the Energy Policy Act of 1992, (16 U.S.C. 824
et seq.) as in effect on the date of this Agreement.
III. Control and Use of Integrated Transmission Facilities
A. Except as otherwise provided for in this Agreement, NEP
agrees, subject to the terms and conditions of this Agreement, to
make the full capacity of all NEP Transmission Facilities
available for exclusive use by XXXX Trans for XXXX Trans to
provide Wholesale Transmission Service under XXXX Trans' Tariffs
and to fulfill the NEP Transmission Obligations. XXXX Trans will
have full authority and control over the use, allocation, and
dispatch of said facilities for this purpose, except that such
authority and control shall be subject to the terms of the General
and Refunding Mortgage Indenture and Deed of Trust between NEP and
the New England Merchants National Bank dated January 1, 1977, as
supplemented from time to time. NECO and MECO hereby consent to
the transfer by NEP to XXXX Trans of the control and use of their
facilities previously used by NEP pursuant to Integrated
Facilities Schedule III-B of NEP's Tariff No. 1.
B. NEP agrees, subject to the terms and conditions of this
Agreement, and consistent with the underlying contract and the
rights of the facility owner, to make the full capacity of all NEP
Transmission Entitlements available to XXXX Trans so that XXXX
Trans may provide Wholesale Transmission Service under XXXX Trans'
Tariffs and to fulfill the NEP Transmission Obligations. XXXX
Trans will have full authority and control over the use,
allocation, and dispatch of said facilities for this purpose. If
NEP is unable for any reason to accomplish the transfer of use and
control over any NEP Transmission Entitlement to XXXX Trans, NEP
will allow XXXX Trans the highest level of control over the use of
said entitlement consistent with the contract creating said
entitlement.
X. XXXX Trans agrees to pay the support charges determined
in accordance with Section V of this Agreement, and any stranded
costs billed by NEP under Section III.E of this Agreement.
X. XXXX Trans agrees to file with FERC and maintain in
force tariffs offering access to the NEP Transmission Facilities
and NEP Transmission Entitlements on a comparable and
nondiscriminatory basis to wholesale transmission customers.
E. NEP is providing XXXX Trans with the control and use of
the NEP Transmission Facilities and Entitlements, and MECO, NECO
and GSE are providing XXXX Trans Distribution Service solely for
the purpose of providing Wholesale Transmission Service. XXXX
Trans shall not use the rights obtained under this Agreement to
provide Retail Transmission Service without the express written
consent of NEP, MECO, NECO and GSE. NEP shall xxxx XXXX Trans and
XXXX Trans shall pay NEP for any stranded costs incurred by NEP
which result from XXXX Trans providing transmission service to any
customer using rights obtained by XXXX Trans under this Agreement.
XXXX Trans shall indemnify and hold NEP harmless from any stranded
costs incurred by NEP, or any suit, order or liability arising
from or in any way associated with XXXX Trans' provision of
transmission services using rights obtained through this
Agreement.
X. XXXX Trans agrees, subject to the terms and conditions
of this Agreement, to provide the services and support required to
fulfill NEP's obligations and commitments as required by the NEP
Transmission Obligations. NEP agrees to notify the other parties
to the contracts listed in Schedule C to make payments directly to
XXXX Trans, to the extent consistent with the contract, and
otherwise, NEP agrees to pay or credit all monies received under
such contracts to XXXX Trans promptly upon receipt.
G. NEP and XXXX Trans agree that all rights and obligations
of NEP within the contracts listed in Schedule A that are not NEP
Transmission Entitlements, as defined herein, are unaffected by
this Agreement and remain with NEP. NEP and XXXX
Trans agree that all rights and obligations of NEP within the
contracts listed in Schedule C that are not NEP Transmission
Obligations, as defined herein, are unaffected by this Agreement
and remain with NEP.
H. The Distribution Affiliates agree to identify NEP as
their Designated Agent for 100% of their respective transmission
loads as provided for in the Service Agreements to the XXXX Trans
Network Integration Transmission Services Tariff with authority as
described therein. The Distribution Affiliates agree that NEP will
remain their Designated Agent for 100% of their respective
transmission loads for as long as the Distribution Affiliates
purchase power from NEP pursuant to NEP's Tariff No. 1, unless
otherwise consented to by NEP. The authority granted to NEP as
Designated Agent will include full authority to designate Network
Resources, delete Network Resources and purchase resources other
than Network Resources, and to schedule transactions over firm
limited interface rights of the Distribution Affiliates.
Additionally the Distribution Affiliates grant to NEP all their
rights to firm limited interface allocations. NEP will also have
the authority to integrate its portion of the Distribution
Affiliates' loads and resources with loads and resources of other
transmission customers who have similarly designated rights to
NEP.
I. NEP has historically provided retail electric service to
two customers in Vermont and two in Massachusetts in areas outside
the Distribution Affiliates' service areas. These customers are
identified in Schedule G to this Agreement. The contracts
underlying these services remain valid and enforceable against
NEP. Therefore NEP must continue to provide these customers
service. NEP and XXXX Trans agree that the transfer of control and
capacity over the NEP Transmission Facilities and NEP Transmission
Entitlements excepts whatever rights are necessary for NEP to
continue providing service to these customers.
IV. Operation, Maintenance and Expansion of NEP Owned Facilities
X. XXXX Trans will operate, schedule maintenance, maintain
and repair in accordance with Good Utility Practice all NEP
Transmission Facilities and facilities used for NEP Transmission
Entitlements to the extent that NEP has operated or maintained
authority pursuant to those entitlements. The costs of such
repairs and maintenance will be paid for by NEP.
B. Upon XXXX Trans' direction, NEP and the Distribution
Affiliates, shall take measures to expand the NEP Transmission
Facilities that each of them own to accommodate XXXX Trans'
customers' needs, consistent with the relevant provisions of XXXX
Trans' Tariffs, as applicable. XXXX Trans shall perform or have
performed a study analyzing alternatives to meet the XXXX Trans
customer's request. Upon selection of an alternative, NEP and the
Distribution Affiliates will exercise due diligence to license,
engineer and construct the selected alternative expansion of the
NEP Transmission Facilities that each of them own. Neither NEP
nor the Distribution Affiliates shall be liable to XXXX Trans or
its customers in the event that construction or expansion is
prevented or delayed by law, regulation or an order of a court,
regulatory body or other lawful authority, or by the failure of
such an agency or authority to grant a necessary authorization,
permit or approval.
V. Support Charges
X. XXXX Trans agrees to pay NEP, on a monthly basis, the
cost of service of NEP's Transmission Facilities and the actual
cost of all NEP Transmission Entitlements including both fixed and
usage based charges as determined by the formula provided in
Schedule B, attached hereto.
X. XXXX Trans agrees to pay NEP and the Distribution
Affiliates the costs of facilities constructed by each of them to
serve individual customers (Direct Assignment Facilities). XXXX
Trans will identify for NEP and the Distribution Affiliates which
facilities are to be treated as Direct Assignment Facilities.
Payments to NEP and the Distribution Affiliates will be calculated
in accordance with the Schedule DAF formulas under the
XXXX Trans' Tariffs. NEP and the Distribution Affiliates will
separately itemize in their bills to XXXX Trans the customer(s)
who benefit from each Direct Assignment Facility. XXXX Trans may
from time to time amend the group of facilities to be treated as
Direct Assignment Facilities.
C. NEP will make arrangements for its customers to pay XXXX
Trans for XXXX Trans' provision of the services required by the
NEP Transmission Obligations. If NEP continues to receive revenue
from any of the NEP Transmission Obligations, NEP agrees to credit
its Transmission Cost of Service under Schedule B, or pay XXXX
Trans all such revenue.
D. NEP, the Distribution Affiliates and XXXX Trans will
issue monthly bills to one another as soon as practicable after
the end of the calendar month. Payments by XXXX Trans to NEP and
the Distribution Affiliates will be due 3 days after payment is
scheduled to be received by XXXX Trans from its customers, on a
rolling basis. NEP, the Distribution Affiliates and XXXX Trans may
adjust any xxxx within six (6) months after a xxxx was rendered,
except where such adjustment is based on data provided by NEPOOL
in which case an adjustment may be made within twenty-four (24)
months after the date the xxxx is rendered.
VI. Interconnection of NEP's Existing Generating Units
X. XXXX Trans and NEP acknowledge that the generating units
set forth in Schedule D are presently interconnected with the NEP
Transmission Facilities. XXXX Trans and NEP agree that these units
are interconnected to the satisfaction of XXXX Trans. Any new
interconnections shall be made in accordance with the requirements
of XXXX Trans as set forth in its Network Integration Transmission
Services Tariff.
VII. Distribution Services
X. XXXX Trans shall have the right to use the Distribution
Affiliates' Distribution Systems for the delivery of electric
power to wholesale transmission customers whose point of delivery
is on the Distribution Affiliates' Distribution Systems and for
the transmission of power from generation resources across the
Distribution Affiliates' distribution system to the point of
interconnection with facilities controlled by XXXX Trans.
B. The Distribution Service provided to XXXX Trans
hereunder shall have the same priority as the Distribution
Affiliates' firm service to their native load customers. In the
event that the loading of the Distribution System, or a portion
thereof, must be reduced for safe and reliable operation, such
reduction in loading will be proportionately allocated among XXXX
Trans customers and the Distribution Affiliates' native load when
such curtailments can be accommodated within acceptable operating
practices.
C. The Distribution Service provided under this Agreement
is available only for the purpose of providing Wholesale
Transmission Service under XXXX Trans' Tariffs. XXXX Trans agrees
that it shall not use the distribution facilities of any
Distribution Affiliates for Retail Transmission Service without
the express written consent of the affected Distribution
Affiliate.
X. XXXX Trans and the Distribution Affiliates agree to
provide timely, accurate information to each other in order to
facilitate performance of their respective obligations under this
Agreement.
VIII. Additional or Modified Distribution Facilities
A. Upon XXXX Trans' request, any of the Distribution
Affiliates shall take measures to expand or modify their
Distribution Systems to accommodate customer requests made to XXXX
Trans for service consistent with the relevant provisions of XXXX
Trans' Network Integration Service Transmission Tariff or Point-
to-Point Transmission Service Tariff, as applicable. XXXX Trans
will be responsible for making arrangements with the affected
Distribution Affiliates for additions and modifications
to Distribution Systems necessary to serve other Wholesale
Transmission Service customers. Any terms and conditions
governing an addition or modification to the Distribution System
beyond those included in the XXXX Trans Tariffs will be filed with
the FERC pursuant to Section 205 of the Federal Power Act.
IX. Payment for Use of Distribution Facilities
X. XXXX Trans agrees to pay the Distribution Affiliates
monthly for the use of their Distribution Facilities in providing
Wholesale Transmission Service. The rate for Distribution Service
for each of the Distribution Affiliates will be determined
annually using the formula provided in Schedule X.
X. XXXX Trans will calculate for every month payment due to
each of the Distribution Affiliates for the use of each
Distribution Affiliate's respective Distribution System in
supplying Wholesale Transmission Service in accordance with XXXX
Trans' Tariffs, as applicable, and in accordance with XXXX Trans'
Tariffs, as applicable, and in accordance with Schedule X. XXXX
Trans will send payment to the respective Distribution Affiliate
for the actual use made of its Distribution Facilities within 3
business days after payment is scheduled to be received from XXXX
Trans' customers, on a rolling basis. XXXX Trans will provide with
payment the backup information and calculations in order that the
Distribution Affiliate will be able to verify the
calculation of the payment.
X. Effective Date and Term
A. This Agreement shall be effective upon the first day of
the calendar month following the later of a) the receipt of all
regulatory approvals necessary for the formation of XXXX Trans;
b) the date that both this Agreement, the XXXX Trans Tariffs, and
the Service Agreements under the Tariffs become effective either
as filed or in a form acceptable to NEP and XXXX Trans; c) approval
by FERC that NEP's transmission Tariffs Nos. 3, 4 and 8, and the
contracts for transmission service listed in Schedule E are
superseded by the XXXX Trans Tariffs; or d) the date that the
amendment of NEP's Xxxxxx Xx.0 to provide for the crediting of
payments for transmission services to XXXX Trans by existing
Tariff No. 1 customers becomes effective.
B. This Agreement shall remain in effect unless terminated
pursuant to the provisions of this Agreement.
C. This Agreement may be terminated by mutual agreement of
the parties, or by any party hereto, upon not less than one year
prior written notice to the other parties.
D. In the event that this Agreement, the XXXX Trans
Tariffs, or other agreements between NEP and XXXX Trans necessary
to implement the XXXX Trans Tariffs are amended, modified, altered
or construed in any material respect different from the
form or meaning at the time this Agreement is entered into, NEP or
XXXX Trans shall have the right to terminate this Agreement, upon
not less than 30 days written notice to parties to this Agreement.
E. If this Agreement is terminated and not otherwise
replaced by a similar agreement, NEP agrees to continue to provide
service under all contracts and obligations undertaken by XXXX
Trans during the period when this Agreement was in effect.
XI. Indemnification
XXXX Trans shall indemnify and hold harmless the other
parties to this Agreement for any and all damages, losses, claims,
demands, suits, recoveries, costs and expenses, including all
court costs and attorney fees arising from or in any way
associated with Wholesale Transmission Service provided by XXXX
Trans, or XXXX Trans' control, use, operation, maintenance and
scheduling of the NEP Transmission Facilities or NEP Transmission
Entitlements that results in claims of third parties or in damage
or destruction of the property of NEP or the Distribution
Affiliates.
NEP and the Distribution Affiliates shall indemnify and hold
XXXX Trans harmless, for any and all damages, losses, claims,
demands, suits, recoveries, costs and expenses, including all
court costs and attorney fees caused by, or resulting from NEP's
or the Distribution Affiliates' gross negligence or wilful
misconduct, that result in claims by parties not entering into
this Agreement, against XXXX Trans.
XII. Force Majeure
No delay or failure in performance of any obligation under
this Agreement shall be deemed to exist if it is the result of
Force Majeure, as defined herein, and that the party whose
performance is affected by Force Majeure uses reasonable efforts
to remedy its inability to perform, and that the suspension of
performance is no longer than is reasonably required. "Force
Majeure" means any cause beyond the reasonable control of the
party claiming Force Majeure, and shall include, without
limitation, any act of God, labor disturbance, act of the public
enemy, war, insurrection, riot, fire, storm or flood, explosion,
breakage, accident to, or failure of machinery or equipment, or by
any other cause or causes beyond the party's control, including
any curtailment, order, regulation or restriction imposed by
governmental military or lawfully established civilian
authorities, or by the making of necessary repairs upon the
property or equipment of either party.
No party hereunder shall be liable to the any other party for
damages for any act, omission, or circumstance occasioned by or in
consequence of Force Majeure.
XIII. Assignment
No assignment, pledge or other transfer of this Agreement by
any party shall be made without the written consent of the other
parties, except an assignment to a company owned by or affiliated
with the New England Electric System.
XIV. Amendment
This Agreement may be amended by mutual agreement of the
parties in writing, and subject to all necessary regulatory
approvals. Nothing in this Agreement shall be deemed to restrict
the right of any party receiving payments under this Agreement to
unilaterally make application to the FERC for an amendment to the
terms and conditions of this Agreement under the applicable
provisions of the Federal Power Act and the rules and regulations
thereunder. Additionally, nothing contained herein shall be
construed as a waiver of any rights of any party to contest an
application to change the terms and conditions of this Agreement.
XV. Notices
Any Notices communicated between the parties under this
Agreement, or relating to the rights, obligations or performance
of the parties hereunder shall be in writing and shall be
effective on delivery. Any such communication shall be delivered
in person or by registered or certified mail, postage prepaid.
Notices to NEP shall be addressed to:
New England Power Company
00 Xxxxxxxx Xxxxx
Xxxxxxxxxxx, XX 00000
Attention: Administrator of XXXX Trans Agreements
Notices to XXXX Trans shall be addressed to:
XXXX Transmission Services, Inc.
00 Xxxxxxxx Xxxxx
Xxxxxxxxxxx, XX 00000
Attention: President
Notices to MECO shall be addressed to:
Massachusetts Electric Company
00 Xxxxxxxx Xxxxx
Xxxxxxxxxxx, XX 00000
Attention: President
Notices to NECO shall be addressed to:
The Narragansett Electric Company
000 Xxxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Attention: President
Notices to GSE shall be addressed to:
Granite State Electric Company
000 Xxxxxxx Xxxx, Xxxxx 0
Xxxxxxx, XX 00000
Attention: President
XVI. Miscellaneous
A. This Agreement shall constitute the entire understanding
among the parties pertaining to the subject matter of this
Agreement and shall supersede any and all previous understandings
among the parties pertaining thereto.
B. This Agreement shall be interpreted and construed in
accordance with the Federal Power Act and the rules and
regulations of the FERC, as applicable, and the law of the
Commonwealth of Massachusetts.
C. The failure of any party to require strict
interpretation of any of the provisions of this Agreement or to
exercise any of its rights under this Agreement shall not be
construed as a general waiver of any such provision or
relinquishment of any such right.
D. In the event that any clause or provision of this
Agreement, or any part thereof, shall be declared invalid or
unenforceable, such invalidity or unenforceability shall not
affect the validity or enforceability of the other portions of
this Agreement.
E. This Agreement may be executed in any number of
counterparts and each shall have the force and effect of the
original.
IN WITNESS WHEREOF, NEP, XXXX Trans, MECO, NECO and GSE, all
intending to be legally bound, have caused this Agreement to be
executed by their duly authorized representatives as of the date
first written above.
New England Power Company XXXX Transmission Services, Inc.
_________________________ ___________________________________
By: _____________________ ___________________________________
By: _____________________ ___________________________________
Its: ____________________ Its: ______________________________
Massachusetts Electric Company Granite State Electric Company
______________________________ ______________________________
______________________________ ______________________________
By: __________________________ By:___________________________
Its: _________________________ Its: __________________________
The Narragansett Electric Company
________________________________
______________________________
Its: __________________________
