PACIFIC GAS AND ELECTRIC COMPANY
STANDARD OFFER #2
POWER PURCHASE AGREEMENT
FOR
FIRM CAPACITY AND ENERGY
MAY 1984
S.O. #2
May 7, 1984
1
STANDARD OFFER #2:
FIRM CAPACITY AND ENERGY
POWER PURCHASE AGREEMENT
CONTENTS
Article Page
1 QUALIFYING STATUS 3
2 PURCHASE OF POWER 4
3 PURCHASE PRICE 6
4 NOTICES 6
5 DESIGNATED SWITCHING CENTER 7
6 TERMS AND CONDITIONS 7
7 TERM OF AGREEMENT 7
Appendix A: GENERAL TERMS AND CONDITIONS
Appendix B: ENERGY PRICES
Appendix C: FIRM CAPACITY PRICE SCHEDULE
Appendix D: ADJUSTMENT OF CAPACITY PAYMENTS IN THE EVENT OF
TERMINATION OR REDUCTION
Appendix E: INTERCONNECTION
S.O. #2
May 7, 1984
2
FIRM CAPACITY AND ENERGY
POWER PURCHASE AGREEMENT
BETWEEN
UNIVERSITY COGENERATION INC., 1985-1
AND
PACIFIC GAS AND ELECTRIC COMPANY
UNIVERSITY COGENERATION INC., 1985-1 (Seller), and PACIFIC GAS AND
ELECTRIC COMPANY (PGandE), referred to collectively as Parties and
individually as Party, agree as follows:
ARTICLE 1 QUALIFYING STATUS
Seller warrants that, at the date of first power deliveries from Seller's
Facility ((1)) and during the term of agreement, its Facility shall meet the
qualifying facility requirements established as of the effective date of this
Agreement by the Federal Energy Regulatory Commission's rules (18 Code of
Federal Regulations 292) implementing the Public Utility Regulatory Policies
Act of 1978 (16 U.S.C.A. 796, et seq.).
((1)) Underlining identifies those terms which are defined in Section A-1
of Appendix A.
S.O. #2
May 7, 1984
3
ARTICLE 2 PURCHASE OF POWER
(a) Seller shall sell and deliver and PGandE shall purchase and
accept delivery of firm capacity and energy at the voltage level of______((1))
kV as indicated below --
1. Contract capacity - 34,000 kW; and
2. Energy - net energy output ((2)).
Seller may convert its energy sale option as provided in Section
A-3 of Appendix A.
(b) Seller shall provide the firm capacity and energy set forth above
from its 38,000 kW (ISO) Facility located at Section 28, township 12 north,
range 24 west, 3 1/2 miles south of Xxxx, Xxxx County, California.
(c) The scheduled operation date of the Facility is November 1986.
At the end of each calendar quarter Seller shall give written notice to PGandE
of any change in the scheduled operation date.
((1)) The Seller requests, and PGandE consents, that this blank not be
filled in at the time of executing the Agreement, because the Seller,
recognizing that the information is not yet available to make a
definitive determination of the number to be inserted in this blank,
shall request PGandE to perform an interconnection study to be done in
its accustomed manner of making such studies to determine the number to
be inserted.
((2)) Insert either net energy output or surplus energy output to show the
energy sale option selected by Seller.
S.O. #2
May 7, 1984
4
(d) To avoid exceeding the physical limitations of the
interconnection facilities, Seller shall limit the Facility's
actual rate of delivery into the PGandE system to ________ ((1)) kW.
(e) The primary energy source for the Facility is natural gas.
(f) If Seller does not begin construction of its Facility by June
1986, PGandE may reallocate the existing capacity on PGandE's transmission
and/or distribution system which would have been used to accommodate Seller's
power deliveries to other uses. In the event of such reallocation, Seller
shall pay PGandE for the cost of any upgrades or additions to PGandE's system
necessary to accommodate the output from the Facility. Such additional
facilities shall be installed, owned, and maintained in accordance with the
applicable PGandE tariff.
(g) The transformer loss adjustment factor is __________((1))((2)).
((1)) The Seller requests, and PGandE consents, that this blank not be filled
in at the time of executing the Agreement, because the Seller,
recognizing that the information is not yet available to make a
definitive determination of the number to be inserted in this blank,
shall request PGandE to perform an interconnection study to be done in
its accustomed manner of making such studies to determine the number to
be inserted.
((2)) If Seller chooses to have meters placed on Seller's side of the
transformer, an estimated transformer loss adjustment factor of 2
percent, unless the Parties agree otherwise, will be applied. This
estimated transformer loss figure will be adjusted to a measurement of
actual transformer losses performed at Seller's request and expense.
S.O. #2
May 7, 1984
5
ARTICLE 3 PURCHASE PRICE
(a) PGandE shall pay Seller for firm capacity at the contract
capacity price under Option 1 set forth in Section C-5 of Appendix C. The
contract capacity price is derived from PGandE's full avoided costs as
approved by the CPUC. PGandE's obligation to pay for the contract capacity
shall begin on the actual operation date. Seller elects to have its contract
capacity price determined from the firm capacity price schedule in effect on
the date of execution of this Agreement((1)). The contract capacity price
shall be subject to adjustment as provided for in Appendix D.
(b) PGandE shall pay Seller for energy at prices equal to PGandE's
full short run avoided operating costs as approved by the CPUC.
(c) The contract capacity price is applicable to deliveries of
capacity beginning after December 30, 1982.
ARTICLE 4 NOTICES
All written notices shall be directed as follows:
To PGandE: Pacific Gas and Electric Company
Attention: Vice President-
Electric Operations
00 Xxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
((1)) Insert either the date of execution of this Agreement or the actual
operation date.
S.O. #2
May 7, 1984
6
To Seller: University Cogeneration Inc.
University Energy
Attention: Secretary
0000 Xxxxxx Xxx Xxx Xxxxx
Xxxxx 000
Xxx Xxxxx, XX 00000
ARTICLE 5 DESIGNATED SWITCHING CENTER
The designated PGandE switching center shall be unless changed by
PGandE:
PGandE Midway Substation
Buttonwillow, CA
(000) 000-0000
ARTICLE 6 TERMS AND CONDITIONS
This Agreement includes the following appendices which are attached and
incorporated by reference:
Appendix A - GENERAL TERMS AND CONDITIONS
Appendix B - ENERGY PRICES
Appendix C - FIRM CAPACITY PRICE SCHEDULE
Appendix D - ADJUSTMENT OF CAPACITY PAYMENTS IN THE EVENT OF
TERMINATION OR REDUCTION
Appendix E - INTERCONNECTION
ARTICLE 7 TERM OF AGREEMENT
This Agreement shall be binding upon execution and remain in effect
thereafter for 10 years from the actual operation date; provided, however,
that it shall terminate if the actual operation date does not occur within
five years of the execution date.
S.O. #2
May 7, 1984
7
IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be
executed by their duly authorized representatives and effective as of the last
date set forth below.
UNIVERSITY COGENERATION INC., 1985-1 PACIFIC GAS AND ELECTRIC COMPANY
BY: /s/ Xxxx X. Xxxxx By: /s/ Xxxxx Xxxxxx
XXXX X. XXXXX XXXXX XXXXXX
TITLE: Secretary TITLE: Vice President -
Planning and Research
DATE SIGNED: April 16, 1985 DATE SIGNED: April 23, 1985
S.O. #2
May 7, 1984
8
APPENDIX A
GENERAL TERMS AND CONDITIONS
CONTENTS
Section
Page
A-1 DEFINITIONS A-2
A-2 CONSTRUCTION A-6
A-3 ENERGY SALE OPTIONS A-10
A-4 OPERATION A-12
A-5 PAYMENT A-16
A-6 ADJUSTMENTS OF PAYMENTS A-17
A-7 ACCESS TO RECORDS AND PGandE DATA A-17
A-8 CURTAILMENT OF DELIVERIES AND HYDRO SPILL CONDITIONS A-18
A-9 FORCE MAJEURE A-21
A-10 INDEMNITY A-22
A-11 LIABILITY; DEDICATION A-23
A-12 SEVERAL OBLIGATIONS A-24
A-13 NON-WAIVER A-24
A-14 ASSIGNMENT A-25
A-15 CAPTIONS A-25
A-16 CHOICE OF LAWS A-25
A-17 GOVERNMENTAL JURISDICTION AND AUTHORIZATION A-26
A-18 NOTICES A-26
A-19 INSURANCE A-27
A-20 REASONABLE ACTION BY EACH PARTY A-29
S.O. #2
May 7, 1984
APPENDIX A
GENERAL TERMS AND CONDITIONS
A-1 DEFINITIONS
Whenever used in this Agreement, appendices, and attachments hereto, the
following terms shall have the following meanings:
Actual operation date - The day following the day during which all
features and equipment of the Facility are demonstrated to PGandE's
satisfaction to be capable of operating simultaneously to deliver power
continuously into PGandE's system as provided in this Agreement.
Adjusted capacity price - The $/kW-year purchase price from Table B,
Appendix C for the period of Seller's actual performance.
Capacity sale reduction - A reduction in the amount of capacity provided
or to be provided under this Agreement, other than a temporary reduction
during probationary periods under Section C-5.
Contract capacity - That capacity identified in Article 2(a) except as
otherwise changed as provided herein.
S.O. #2
May 7, 1984
A-2
Contract capacity price - The capacity price applicable for the period
from the actual operation date through the term of agreement from either the
firm capacity price schedule, Table B of Appendix C, or the successor to Table
B in effect on the Actual operation date. Seller has indicated its choice of
firm capacity price schedule in Article 3(a).
Contract termination - The early termination of this Agreement.
CPUC - The Public Utilities Commission of the State of California.
Current firm capacity price - The $/kW-year capacity price from the firm
capacity price schedule published by PGandE at the time notice of termination
or reduction of contract capacity is given, for a term equal to the period
from the date of termination or reduction to the end of the term of agreement.
Designated PGandE switching center - That switching center or other
PGandE installation identified in Article 5.
Dispatchable - The Facility is operable and can be called upon at any
time to increase its deliveries of capacity to any level up to the contract
capacity.
S.O. #2
May 7, 1984
A-3
Facility - That generation apparatus described in Article 2 and all
associated equipment owned, maintained, and operated by Seller.
Firm capacity price schedule - The periodically published schedule of
the $/kW-year prices that PGandE offers to pay for capacity. See Table B,
Appendix C.
Forced outage - Any outage resulting from a design defect, inadequate
construction, operator error or a breakdown of the mechanical or electrical
equipment that fully or partially curtails the electrical output of the
Facility.
Interconnection facilities - All means required and apparatus installed
to interconnect and deliver power from the Facility to the PGandE system
including, but not limited to, connection, transformation, switching,
metering, communications, and safety equipment, such as equipment required to
protect (1) the PGandE system and its customers from faults occurring at the
Facility, and (2) the Facility from faults occurring on the PGandE system or
on the systems of others to which the PGandE system is directly or indirectly
connected. Interconnection facilities also include any necessary additions
and reinforcements by PGandE to the PGandE system required as a result of the
interconnection of the Facility to the PGandE system.
S.O. #2
May 7, 1984
A-4
Net energy output - The Facility's gross output in kilowatt-hours less
station use and transformation and transmission losses to the point of
delivery into the PGandE system. Where PGandE agrees that it is impractical
to connect the station use on the generator side of the power purchase meter,
PGandE may, at its option, apply a station load adjustment.
Prudent electrical practices - Those practices, methods, and equipment,
as changed from time to time, that are commonly used in prudent electrical
engineering and operations to design and operate electric equipment lawfully
and with safety, dependability, efficiency, and economy.
Scheduled operation date - The day specified in Article 2(c) when the
Facility is, by Seller's estimate, expected to produce energy and capacity
that will be available for delivery to PGandE.
Special facilities - Those additions and reinforcements to the PGandE
system which are needed to accommodate the maximum delivery of energy and
capacity from the facility as provided in this Agreement and those parts of
the interconnection facilities which are owned and maintained by PGandE at
Seller's request, including metering and data processing equipment.
S.O. #2
May 7, 1984
A-5
All special facilities shall be owned, operated, and maintained pursuant to
PGandE's electric Rule No. 21, which is attached hereto.
Station use - Energy used to operate the Facility's auxiliary equipment.
The auxiliary equipment includes, but is not limited to, forced and induced
draft fans, cooling towers, boiler feed pumps, lubricating oil systems, plant
lighting, fuel handling systems, control systems, and sump pumps.
Surplus energy output - The Facility's gross output, in kilowatt-hours,
less station use, and any other use by Seller, and transformation and
transmission losses to the point of delivery into the PGandE system.
Term of agreement - The period of time during which this Agreement will
be in effect as provided in Article 7.
Voltage level - The voltage at which the Facility interconnects with the
PGandE system, measured at the point of delivery.
A-2 CONSTRUCTION
A-2.1 Land Rights
PGandE's equipment is to be installed on property owned by other than
Seller. Seller shall, at its own cost and expense, obtain from the owners
S.O. #2
May 7, 1984
A-6
thereof all necessary rights of way and easements, in a form satisfactory to
PGandE, for the construction, operation, maintenance, and replacement of
PGandE's equipment upon such property. If Seller is unable to obtain such
rights of way and easements, Seller shall reimburse PGandE for all costs,
including attorney's fees and litigation expenses, incurred by PGandE in
obtaining them. PGandE shall at all times have the right of ingress to and
egress from the Facility at all reasonable hours for any purposes reasonably
connected with this Agreement or the exercise of any and all rights secured to
PGandE by law or its tariff schedules.
A-2.2 Design, Construction, Ownership, and Maintenance
(a) Seller shall design, construct, install, own, operate, and
maintain all interconnection facilities, except special facilities, to the
point of interconnection with the PGandE system as required for PGandE to
receive firm capacity and energy from the Facility. The Facility and
interconnection facilities shall meet all requirements of applicable codes and
all standards of prudent electrical practices and shall be maintained in a
safe and prudent manner. A description of the interconnection facilities for
which Seller is solely responsible is set forth in Appendix E, or if the
interconnection requirements have not yet been determined at the time of the
execution of this Agreement, the description of such facilities will be
S.O. #2
May 7, 1984
A-7
appended to this Agreement at the time such determination is made.
(b) Seller shall submit to PGandE the design and all specifications
for the interconnection facilities (except special facilities) and, at
PGandE's option, the Facility, for review and written acceptance prior to
their release for construction purposes. PGandE shall notify Seller in
writing of the outcome of PGandE's review of the design and specifications for
Seller's interconnection facilities (and the Facility, if requested) within 30
days of the receipt of the design and all of the specifications for the
interconnection facilities (and the Facility, if requested). Any flaws
perceived by PGandE in the design and specifications for the interconnection
facilities (and the Facility, if requested) will be described in PGandE's
written notification. PGandE's review and acceptance of the design and
specifications shall not be construed as confirming or endorsing the design
and specifications or as warranting their safety, durability, or reliability.
PGandE shall not, by reason of such review or lack of review, be responsible
for strength, details of design, adequacy, or capacity of equipment built
pursuant to such design and specifications, nor shall PGandE's acceptance be
deemed to be an endorsement of any of such equipment. Seller shall change the
interconnection facilities as may be reasonably required by PGandE to meet
changing requirements of the PGandE system.
S.O. #2
May 7, 1984
A-8
(c) In the event it is necessary for PGandE to install interconnection
facilities for the purposes of this Agreement, they shall be installed as
special facilities.
(d) Upon the request of Seller, PGandE shall provide a binding
estimate for the installation of interconnection facilities by PGandE.
A-2.3 Meter Installation
(a) PGandE shall specify, provide, install, own, operate, and maintain
as special facilities all metering and data processing equipment for the
registration and recording of energy and other related parameters which are
required for the reporting of data to PGandE and for computing the payment due
Seller from PGandE.
(b) Seller shall provide, construct, install, own, and maintain at
Seller's expense all that is required to accommodate the metering and data
processing equipment, such as, but not limited to, metal-clad switchgear,
switchboards, cubicles, metering panels, enclosures, conduits, rack
structures, and equipment mounting pads.
(c) PGandE shall permit meters to be fixed on PGandE's side of the
transformer. If meters are placed on PGandE's side of the transformer,
service will be provided at the available primary voltage and no transformer
loss adjustment will be made. If Seller chooses to have meters placed on
S.O. #2
May 7, 1984
A-9
Seller's side of the transformer, an estimated transformer loss adjustment
factor of 2 percent, unless the Parties agree otherwise, will be applied.
A-3 ENERGY SALE OPTIONS
A-3.1 General
Seller has two energy sale options, net energy output or surplus energy
output. Seller has made its initial selection in Article 2(a).
A-3.2 Energy Sale Conversion
(a) Seller is entitled to convert from one option to the other 12
months after execution of this Agreement, and thereafter at least 12 months
after the effective date of the most recent conversion, subject to the
following conditions:
(1) Seller shall provide PGandE with a written request to
convert its energy sale option.
(2) Seller shall comply with all applicable tariffs on file with
the CPUC and contracts in effect between the Parties at the time of conversion
covering the existing and proposed (i) facilities used to serve Seller's
S.O. #2
May 7, 1984
A-10
premises and (ii) interconnection facilities.
(3) Seller shall install and operate equipment required by
PGandE to prevent PGandE from serving any part of Seller's load which is
served by the Facility and not under contract for PGandE standby
service. At Seller's request PGandE shall provide this equipment as
special facilities.
(4) If the energy sale conversion results in a capacity sale
reduction, the provisions in Appendix D shall apply.
(b) If, as a result of an energy sales conversion, Seller no longer
requires the use of interconnection facilities installed and/or operated and
maintained by PGandE as special facilities under a Special Facilities
Agreement, Seller may reserve these facilities, for its future use, by
continuing its performance under its Special Facilities Agreement. If Seller
does not wish to reserve such facilities, it may terminate its Special
Facilities Agreement.
If Seller's energy sale conversion results in its discontinuation
of its use of PGandE facilities not covered by Seller's Special Facilities
Agreement, Seller cannot reserve those facilities for future use. Seller's
future use of such facilities shall be contingent upon the availability of
S.O. #2
May 7, 1984
A-11
such facilities at the xxxx Xxxxxx requests such use. If such facilities are
not available, Seller shall bear the expense necessary to install, own, and
maintain the needed additional facilities in accordance with PGandE's
applicable tariff.
(c) PGandE shall process requests for conversion in the order
received. The effective date of conversion shall depend on the completion of
the changes required to accommodate Seller's energy sale conversion.
A-4 OPERATION
A-4.2 Inspection and Approval
Seller shall not operate the Facility in parallel with PGandE's system
until an authorized PGandE representative has inspected the interconnection
facilities, and PGandE has given written approval to begin parallel operation.
Seller shall notify PGandE of the Facility's start-up date at least 45 days
prior to such date. PGandE shall inspect the interconnecting facilities
within 30 days of the receipt of such notice. If parallel operation is not
authorized by PGandE, PGandE shall notify Seller in writing within five days
after inspection of the reason authorization for parallel operation was
withheld.
S.O. #2
May 7, 1984
A-12
A-4.2 Facility Operation and Maintenance
Seller shall operate and maintain its Facility according to prudent
electrical practices, applicable laws, orders, rules, and tariffs and shall
provide such reactive power support as may be reasonably required by PGandE to
maintain system voltage level and power factor. Seller shall operate the
Facility at the power factors or voltage levels prescribed by PGandE's system
dispatcher or designated representative. If Seller fails to provide reactive
power support, PGandE may do so at Seller's expense.
A-4.3 Point of Delivery
Seller shall deliver the energy at the point where Xxxxxx's electrical
conductors (or those of Seller's agent) contact PGandE's system as it shall
exist whenever the deliveries are being made or at such other point or points
as the Parties may agree in writing. The initial point of delivery of
Seller's power to the PGandE system is set forth in Appendix E.
A-4.4 Operating Communications
(a) Seller shall maintain operating communications with the designated
PGandE switching center. The operating communications shall include, but not
be limited to, system paralleling or separation, schedule and unscheduled
S.O. #2
May 7, 1984
A-13
shutdowns, equipment clearances, levels of operating voltage or power factor
and daily capacity and generation reports.
(b) Seller shall keep a daily operations log for each generating unit
which shall include information on unit availability, maintenance outages,
circuit breaker trip operations requiring a manual reset, and any significant
events related to the operation of the Facility.
(c) If Seller makes deliveries greater than one megawatt, Seller shall
measure and register on a graphic recording device power in kW and voltage in
kV at a location within the Facility agreed to by both parties.
(d) If Seller makes deliveries greater than one and up to and
including ten megawatts, Seller shall report to the designated PGandE
switching center, twice a day at agreed upon times for the current day's
operation, the hourly readings in kW of capacity delivered and the energy in
kWh delivered since the last report.
(e) If Seller makes deliveries of greater than ten megawatts, Seller
shall telemeter the delivered capacity and energy information, including real
power in kW, reactive power in kVAR, and energy in kWh to a switching center
selected by PGandE. PGandE may also required Seller to telemeter transmission
S.O. #2
May 7, 1984
A-14
kW, kVAR, and kV data depending on the number of generators and transmission
configuration. Seller shall provide and maintain the data circuits required
for telemetering. When telemetering is inoperative, Seller shall report daily
the capacity delivered each hour and the energy delivered each day to the
designated PGandE switching center.
(f) If Seller provides dispatchable capacity greater than ten
megawatts pursuant to Option 1 in Section C-5 of Appendix C, Seller may be
required by PGandE to provide telemetering and control equipment to allow the
Facility to respond to system load frequency requirements on digital control
from PGandE.
A-4.5 Meter Testing and Inspection
(a) All meters used to provide data for the computation of the
payments due Seller from PGandE shall be sealed, and the seals shall be broken
only by PGandE when the meters are to be inspected, tested, or adjusted.
(b) PGandE shall inspect and test all meters upon their installation
and annually thereafter. At Seller's request and expense, PGandE shall
inspect or test a meter more frequently. PGandE shall give reasonable notice
to Seller of the time when any inspection or test shall take place, and Seller
may have representatives present at the test or inspection. If a meter is
found to be inaccurate or defective, PGandE shall adjust, repair, or replace
it at its expense in order to provide accurate metering.
S.O. #2
May 7, 1984
A-15
A-4.6 Adjustments to Meter Measurements
If a meter fails to register, or if the measurement made by a meter
during a test varies by more than two percent from the measurement made by the
standard meter used in the test, an adjustment shall be made correcting all
measurements made by the inaccurate meter for -- (1) the actual period during
which inaccurate measurements were made, if the period can be determined, or
if not, (2) the period immediately preceding the test of the meter equal to
one-half the time from the date of the last previous test of the meter,
provided that the period covered by the correction shall not exceed six
months.
A-5 PAYMENT
PGandE shall mail to Seller not later than 30 days after the end of each
monthly billing period, (1) a statement showing the capacity and energy
delivered to PGandE during on-peak, partial-peak, and off-peak periods during
the monthly billing period, (2) PGandE's computation of the amount due Seller,
and (3) PGandE's check in payment of said amount. Except as provided in
Section A-6, if within 30 days of receipt of this statement Seller does not
make a report in writing to PGandE of an error, Seller shall be deemed to have
S.O. #2
May 7, 1984
A-16
waived any error in PGandE's statement, computation, and payment, and they
shall be considered correct and complete.
A-6 ADJUSTMENTS OF PAYMENTS
(a) In the event adjustments to payments are required as a result of
inaccurate meters, PGandE shall use the corrected measurements described in
Section A-4.6 to recompute the amount due from PGandE to Seller for the firm
capacity and energy delivered under this Agreement during the period of
inaccuracy.
(b) The additional payment to Seller or refund to PGandE shall be made
within 30 days of notification of the owing Party of the amount due.
A-7 ACCESS TO RECORDS AND PGandE DATA
Each Party, after giving reasonable written notice to the other Party,
shall have the right of access to all metering and related records including
operations logs of the Facility. Data filed by PGandE with the CPUC pursuant
to CPUC orders governing the purchase of power from qualifying facilities
shall be provided to Seller upon request; provided that Seller shall reimburse
PGandE for the costs it incurs to respond to such request.
S.O. #2
May 7, 1984
A-17
A-8 CURTAILMENT OF DELIVERIES AND HYDRO SPILL CONDITIONS
(a) PGandE shall not be obligated to accept or pay for and may require
Seller to interrupt or reduce deliveries of energy (1) when necessary in order
to construct, install, maintain, repair, replace, remove, investigate, or
inspect any of its equipment or any part of its system, or (2) if it
determines that interruption or reduction is necessary because of emergencies,
forced outages, force majeure, or compliance with prudent electrical
practices. PGandE shall make reasonable efforts to coordinate any
interruptions or reduced deliveries for reasons specified in (1) above to
periods of scheduled outages for which Seller has provided proper notice.
(b) In anticipation of a period of hydro spill conditions, as defined
by the CPUC, PGandE may notify Seller that any purchases of energy from Seller
during such period shall be at hydro savings prices quoted by PGandE. If
Seller delivers energy to PGandE during any such period, Seller shall be paid
hydro savings prices for those deliveries in lieu of prices which would
otherwise be applicable. The hydro savings prices shall be calculated by
PGandE using the following formula:
AQF - S x PP
AQF
S.O. #2
May 7, 1984
A-18
where:
AQF = Energy, in kWh, projected to be available during hydro spill conditions
from all qualifying facilities under agreements containing hydro savings
price provisions.
S = Potential energy, in kWh, from PGandE hydro facilities which will be
spilled if all AQF is delivered to PGandE.
PP = Prices published by PGandE for purchases during other than hydro spill
conditions.
(c) PGandE shall not be obligated to accept or pay for and may require
Seller with a Facility with a nameplate rating of one megawatt or greater to
interrupt or reduce deliveries of energy during periods when purchases under
this Agreement would result in costs greater than those which PGandE would
incur if it did not make such purchases but instead generated an equivalent
amount of energy itself.
(d) Whenever possible, PGandE shall give Seller reasonable notice of
the possibility that interruption or reduction of deliveries under subsections
(a) or (c), above, may be required. PGandE shall give Seller notice of
general periods when hydro spill conditions are anticipated, and shall give
Seller as much advance notice as practical of any specific hydro spill period
and the hydro savings price which will be applicable during such period.
Before interrupting or reducing deliveries under subsection (c), above, and
S.O. #2
May 7, 1984
A-19
before invoking hydro savings prices under subsection (b), above, PGandE shall
take reasonable steps to make economy sales of the surplus energy giving rise
to the condition. If such economy sales are made, while the surplus energy
conditions exists Seller shall be paid at the economy sales price obtained by
PGandE in lieu of the otherwise applicable prices.
(e) If Seller is selling net energy output to PGandE and
simultaneously purchasing its electrical needs from PGandE, energy curtailed
pursuant to subsections (b) or (c) above shall not be used by Seller to meet
its electrical needs. When Seller elects not to sell energy to PGandE at the
hydro savings price pursuant to subsection (b) or when PGandE curtails
deliveries of energy pursuant to subsection (c), Seller shall continue to
purchase all its electrical needs from PGandE. If Seller is selling surplus
energy output to PGandE, subsections (b) or (c) shall only apply to the
surplus energy output being delivered to PGandE, and Seller can continue to
internally use that generation it has retained for its own use.
(f) PGandE and Seller desire to and will continue to explore
alternatives to Subsections (b), (c), (d), and (e) above that would compensate
Seller for granting to PGandE increased flexibility to interrupt or reduce
energy deliveries. The parties agree to amend this Section A-8 accordingly if
they reach agreement on such an alternative.
S.O. #2
May 7, 1984
A-20
A-9 FORCE MAJEURE
(a) The term force majeure as used herein means unforeseeable causes,
other than forced outages, beyond the reasonable control of and without the
fault or negligence of the Party claiming force majeure including, but not
limited to, acts of God, labor disputes, sudden actions of the elements,
actions by federal, state, and municipal agencies, and actions of legislative,
judicial, or regulatory agencies which conflict with the terms of this
Agreement.
(b) If either Party because of force majeure is rendered wholly or
partly unable to perform its obligations under this Agreement, that Party
shall be excused from whatever performance is affected by the force majeure to
the extent so affected provided that:
(1) the non-performing Party, within two weeks after the
occurrence of the force majeure, gives the other Party written notice
describing the particulars of the occurrence,
(2) the suspension of performance is of no greater scope and of
no longer duration than is required by the force majeure,
(3) the non-performing Party uses its best efforts to remedy its
inability to perform (this subsection shall not require the settlement
of any strike, walkout, lockout or other labor dispute on terms which,
S.O. #2
May 7, 1984
A-21
in the sole judgment of the Party involved in the dispute, are contrary to its
interest. It is understood and agreed that the settlement of strikes,
walkouts, lockouts or other labor disputes shall be at the sole discretion of
the Party having the difficulty),
(4) when the non-performing Party is able to resume performance
of its obligations under this Agreement, that Party shall give the other
Party written notice to that effect, and
(5) capacity payments during such periods of force majeure on
Seller's part shall be governed by Section C-2(c) of Appendix C.
(c) In the event a Party is unable to perform due to legislative,
judicial, or regulatory agency action, this Agreement shall be renegotiated to
comply with the legal change which caused the non-performance.
A-10 INDEMNITY
Each Party as indemnitor shall save harmless and indemnify the other
Party and the directors, officers, and employees of such other Party against
and from any and all loss and liability for injuries to persons including
employees of either Party, and property damages including property of either
Party resulting from or arising out of (1) the engineering, design,
construction, maintenance, or operation of, or (2) the making of replacements,
S.O. #2
May 7, 1984
A-22
additions, or betterments to, the indemnitor's facilities. This indemnity and
save harmless provision shall apply notwithstanding the active or passive
negligence of the indemnitee. Neither Party shall be indemnified hereunder
for its liability or loss resulting from its sole negligence or willful
misconduct. The indemnitor shall, on the other Party's request, defend any
suit asserting a claim covered by this indemnity and shall pay all costs,
including reasonable attorney fees, that may be incurred by the other Party in
enforcing this indemnity.
A-11 LIABILITY; DEDICATION
(a) Nothing in this Agreement shall create any duty to, any standard
of care with reference to, or any liability to any person not a Party to it.
Neither Party shall be liable to the other Party for consequential damages.
(b) Each Party shall be responsible for protecting its facilities from
possible damage by reason of electrical disturbances or faults caused by the
operation, faulty operation, or nonoperation of the other Party's facilities,
and such other Party shall not be liable for any such damages so caused.
(c) No undertaking by one Party to the other under any provision of
this Agreement shall constitute the dedication of that Party's system or any
S.O. #2
May 7, 1984
A-23
portion thereof to the other Party or to the public or affect the status of
PGandE as an independent public utility corporation or Seller as an
independent individual or entity and not a public utility.
A-12 SEVERAL OBLIGATIONS
Except where specifically stated in this Agreement to be otherwise, the
duties, obligations, and liabilities of the Parties are intended to be several
and not joint or collective. Nothing contained in this Agreement shall ever
be construed to create an association, trust, partnership, or joint venture or
impose a trust or partnership duty, obligation, or liability on or with regard
to either Party. Each Party shall be liable individually and severally for
its own obligations under this Agreement.
A-13 NON-WAIVER
Failure to enforce any right or obligation by either Party with respect
to any matter arising in connection with this Agreement shall not constitute a
waiver as to that matter or any other matter.
S.O. #2
May 7, 1984
A-24
A-14 ASSIGNMENT
Neither Party shall voluntarily assign its rights nor delegate its
duties under this Agreement, or any part of such rights or duties, without the
written consent of the other Party, except in connection with the sale or
merger of a substantial portion of its properties. Any such assignment or
delegation made without such written consent shall be null and void. Consent
for assignment shall not be withheld unreasonably. Such assignment shall
include, unless otherwise specified therein, all of Seller's rights to any
refunds which might become due under this Agreement.
A-15 CAPTIONS
All indexes, titles, subject headings, section titles, and similar items
are provided for the purpose of reference and convenience and are not intended
to affect the meaning of the contents or scope of this Agreement.
A-16 CHOICE OF LAWS
This Agreement shall be interpreted in accordance with the laws of the
State of California, excluding any choice of law rules which may direct the
application of the laws of another jurisdiction.
S.O. #2
May 7, 1984
A-25
A-17 GOVERNMENTAL JURISDICTION AND AUTHORIZATION
Seller shall obtain any governmental authorizations and permits required
for the construction and operation of the Facility. Seller shall reimburse
PGandE for any and all losses, damages, claims, penalties, or liability it
incurs as a result of Seller's failure to obtain or maintain such
authorizations and permits.
A-18 NOTICES
Any notice, demand, or request required or permitted to be given by
either Party to the other, and any instrument required or permitted to be
tendered or delivered by either Party to the other, shall be in writing
(except as provided in Section C-3) and so given, tendered, or delivered, as
the case may be, by depositing the same in any United States Post Office with
postage prepaid for transmission by certified mail, return receipt requested,
addressed to the Party, or personally delivered to the Party, at the address
in Article 4 of this Agreement. Changes in such designation may be made by
notice similarly given.
S.O. #2
May 7, 1984
A-26
A-19 INSURANCE
A-19.1 General Liability Coverage
(a) Seller shall maintain during the performance hereof, General
Liability Insurance ((1)) of not less than $1,000,000 if the Facility is over
100 kW, $500,000 if the Facility is over 20 kW to 100 kW, and $100,000 if the
Facility is 20 kW or below of combined single limit or equivalent for bodily
injury, personal injury, and property damage as the result of any one
occurrence.
(b) General Liability Insurance shall include coverage for Premises-
Operations, Owners and Contractors Protective, Products/Completed Operations
Hazard, Explosion, Collapse, Underground, Contractual Liability, and Broad
Form Property Damage including Completed Operations.
(c) Such insurance, by endorsement to the policy(ies), shall include
PGandE as an additional insured if the Facility is over 100 kW insofar as work
performed by Seller for PGandE is concerned, shall contain a severability of
interest clause, shall provide that PGandE shall not by reason of its
inclusion as an additional insured incur
((1)) Governmental agencies which have an established record of self-insurance
may provide the required coverage through self-insurance.
S.O. #2
May 7, 1984
A-27
liability to the insurance carrier for payment of premium for such insurance,
and shall provide for 30-days' written notice to PGandE prior to cancellation,
termination, alteration, or material change of such insurance.
A-19.2 Additional Insurance Provisions
(a) Evidence of coverage described above in Section A-19.1 shall state
that coverage provided is primary and is not excess to or contributing with
any insurance or self-insurance maintained by PGandE.
(b) PGandE shall have the right to inspect or obtain a copy of the
original policy(ies) of insurance.
(c) Seller shall furnish the required certificates ((1)) and
endorsements to PGandE prior to commencing operation.
(d) All insurance certificates 1, endorsements, cancellations,
terminations, alterations, and material changes of such insurance shall be
issued and submitted to the following:
PACIFIC GAS AND ELECTRIC COMPANY
Attention: Manager - Insurance Department
00 Xxxxx Xxxxxx, Xxxx X000
Xxx Xxxxxxxxx, XX 00000
((1)) A governmental agency qualifying to maintain self-insurance should
provide a statement of self-insurance.
S.O. #2
May 7, 1984
A-28
A-20 REASONABLE ACTION BY EACH PARTY
Any action required of either Party pursuant to this agreement,
including those in the sole discretion of one Party, shall be undertaken in a
reasonable manner and in a manner least likely to cause harm to the other
party. This paragraph is not in any way intended to require special treatment
of Seller as compared to other QFs.
S.O. #2
May 7, 1984
A-29
APPENDIX B
ENERGY PRICES
TABLE A
Energy Prices Effective February 1 - April 30, 1985
The energy purchase price calculations which will apply to energy
deliveries determined from meter readings taken during February, March and
April 1985 are as follows:
(a) (b) (c) (d)
Revenue Requirement Energy Purchase
Incremental for Cash Price
Time Period Energy Rate Cost of Energy Working Capital (d)={(a)x(b)}+(c)
((1)) ((2)) ((3)) ((4))
(Btu/kWh) ($/10-6 Btu) ($/kWh) ($/kWh)
February 1-
April 30
(Period B)
Time of
Delivery
Basis:
On-Peak 16,320 5.2394 0.00053 0.08604
Partial-Peak 15,689 5.2394 0.00051 0.08271
Off-Peak 11,625 5.2394 0.00038 0.06129
Seasonal
Average
(Period B) 13,692 5.2394 0.00045 0.07219
____________________________________
((1)) Incremental energy rates (Btu/kWh) for Seasonal Period A and Seasonal
Period B are derived from the marginal energy costs (including variable
operating and maintenance expense) adopted by the CPUC in Decision No.
00-00-000 (page 339). They are based upon natural gas as the
incremental fuel and weighted average hydroelectric power conditions.
((2)) Cost of natural gas under PGandE Gas Schedule No. G-55 effective
February 1, 1985 per Advice No. 1304-G.
((3)) Revenue Requirement for Cash Working Capital as prescribed by the CPUC
in Decision No. 00-00-000.
((4)) Energy Purchase Price = (Incremental Energy Rate x Cost of Energy) +
Revenue Requirement for Cash Working Capital. The energy purchase price
excludes the applicable energy line loss adjustment factors. However,
as ordered by Ordering Paragraph No. 12(j) of CPUC Decision No. 82-12-
120, this figure is currently 1.0 for transmission and primary
distribution loss adjustments and is equal to marginal cost line loss
adjustment factors for the secondary distribution voltage level. These
factors may be changed by the CPUC in the future. The currently
applicable energy loss adjustment factors are shown in Table C.
S.O. #2
May 7, 1984
B-1
TABLE B((1))
Time Periods
Monday
through Sundays
Friday Saturdays and Holidays
((2)) ((2))
Seasonal Period A
(May 1 through September 30)
On-Peak 12:30 p.m.
to
6:30 p.m.
Partial-Peak 8:30 a.m. 8:30 a.m.
to to
12:30 p.m. 10:30 p.m.
6:30 p.m.
to
10:30 p.m.
Off-Peak 10:30 p.m. 10:30 p.m. All Day
to to
8:30 a.m. 8:30 a.m.
Seasonal Period B
(October 1 through April 30)
On-Peak 4:30 p.m.
to
8:30 p.m.
Partial-Peak 8:30 p.m. 8:30 a.m.
to to
10:30 p.m. 10:30 p.m.
8:30 a.m.
to
4:30 p.m.
Off-Peak 10:30 p.m. 10:30 p.m. All Day
to to
8:30 a.m. 8:30 a.m.
____________________________________
((1)) This table is subject to change to accord with the on-peak, partial-
peak, and off-peak periods as defined in PGandE's own rate schedules for
the sale of electricity to its large industrial customers.
((2)) Except the following holidays: New Year's Day, Washington's Birthday,
Memorial Day, Independence Day, Labor Day, Veteran's Day, Thanksgiving
Day, and Christmas Day, as specified in Public Law 90-363 (5 U.S.C.A.
Section 6103(a)).
S.O. #2
May 7, 1984
B-2
TABLE C
Energy Loss Adjustment Factors ((1))
Primary Secondary
Transmission Distribution Distribution
Seasonal Period A
(May 1 through September 30)
On-Peak 1.0 1.0 1.0148
Partial-Peak 1.0 1.0 1.0131
Off-Peak 1.0 1.0 1.0093
Seasonal Period B
(October 1 through April 30)
On-Peak 1.0 1.0 1.0128
Partial-Peak 1.0 1.0 1.0119
Off-Peak 1.0 1.0 1.0087
____________________________________
((1)) The applicable energy loss adjustment factors may be revised pursuant to
orders of the CPUC.
S.O. #2
May 7, 1984
B-3
APPENDIX C
FIRM CAPACITY PRICE SCHEDULE
CONTENTS
Section Page
C-1 GENERAL C-2
C-2 PERFORMANCE REQUIREMENTS C-2
C-3 SCHEDULED MAINTENANCE C-5
C-4 ADJUSTMENTS TO CONTRACT CAPACITY C-6
C-5 PAYMENT OPTIONS C-7
C-6 DETERMINATION OF NATURAL FLOW DATA C-15
C-7 THEORETICAL OPERATION STUDY C-16
C-8 DETERMINATION OF AVERAGE DRY YEAR CAPACITY RATINGS C-17
C-9 INFORMATION REQUIREMENTS C-18
C-10 ILLUSTRATIVE EXAMPLE C-19
S.O. #2
May 7, 1984
C-1
APPENDIX C
FIRM CAPACITY PRICE SCHEDULE
C-1 GENERAL
This Appendix C establishes conditions and prices under which PGandE
shall pay for firm capacity.
C-2 PERFORMANCE REQUIREMENTS
(a) To receive full capacity payments the Facility must meet the
following requirements:
(1) The contract capacity shall be available ((1)) for all of
the on-peak hours 2 in the peak months on the PGandE system, which are
presently the months of June, July and August, subject to a 20 percent
allowance for forced outages in any month. Compliance with this
provision shall be based on the Facility's total on-peak availability
((1)) for each of the peak months and shall exclude any energy
associated with generation levels greater than the contract capacity.
____________________________________
((1)) For purposes of Option 1, available means either dispatchable by
PGandE or actually delivered to PGandE. For purposes of Option 2,
available means actually delivered to PGandE.
((2)) On-peak, partial-peak, and off-peak hours are defined in Table B,
Appendix B.
S.O. #2
May 7, 1984
C-2
(2) If Seller selects Option 1, the contract capacity shall be
dispatchable throughout the year, subject to (i) a monthly allowance for forced
outages of 20% of the hours Seller is called upon to deliver power to PGandE
and (ii) the allowances for scheduled maintenance outages. Except during the
peak months on the PGandE system, Seller may accumulate and apply the 20
percent allowance for forced outages for any consecutive three month period.
Seller shall demonstrate that the Facility is fueled by a reliable fuel supply
and adequate fuel storage is available to deliver power as requested by
PGandE's system dispatcher. Such demonstration could reasonably include
documentation of the current availability of the fuel, identification of the
source, and production of contracts for its purchase and supply.
(b) If Seller is prevented from meeting the performance requirements
because of a forced outage on the PGandE system or a condition set forth
in Section A-8, PGandE shall continue capacity payments. Under Option 2,
capacity payments will be calculated in the same manner used for
scheduled maintenance outages.
(c) If Seller is prevents from meeting the performance requirements
because of force majeure, PGandE shall continue capacity payments for ninety
days from the occurrence of the force majeure. Thereafter, Seller shall be
S.O. #2
May 7, 1984
C-3
deemed to have failed to have met the performance requirements. Under Option
2, capacity payments will be calculated in the same manner used for scheduled
maintenance outages.
(d) If Seller is prevented from meeting the performance requirements
because of extreme dry year conditions, PGandE shall continue capacity
payments. Extreme dry year conditions are drier than those used to establish
contract capacity pursuant to Section C-8. Seller shall warrant to PGandE
that the Facility is a hydroelectric facility and that such conditions are the
sole cause of Seller's inability to meet its contract capacity obligations.
Under Option 1, starting with the month in which Seller cannot provide its
contract capacity, payments shall be made under Option 2 for a one-year
period, and if at the end of this one-year period Seller is not able to resume
the contract capacity due solely to continued extreme dry year conditions,
Seller shall continue to receive payments under Option 2 for additional
one-year periods as long as such conditions continue to exist.
(e) If Seller is prevents from meeting the performance requirements
for reasons other than those described above in Sections C-2(b), (c) or (d):
(1) Seller shall receive the reduced capacity payments as
provided in Section C-5 for a probationary period not to exceed 15
months, or as otherwise agreed to by the Parties.
S.O. #2
May 7, 1984
C-4
(2) If, at the end of the probationary period Seller has not
demonstrated that the Facility can meet the performance requirements, PGandE
may derate the contract capacity pursuant to Section C-4(b).
C-3 SCHEDULED MAINTENANCE
Outage periods for scheduled maintenance shall not exceed 840 hours (35
days) in any 12-month period. This allowance may be used in increments of an
hour or longer on a consecutive or nonconsecutive basis. Seller may
accumulate unused maintenance hours from one 12-month period to another up to
a maximum of 1,080 hours (45 days). This accrued time must be used
consecutively and only for major overhauls. Seller shall provide PGandE with
the following advance notices: 24 hours for scheduled outages less than one
day, one week for a scheduled outage of one day or more (except for major
overhauls), and six months for a major overhaul. Seller shall not schedule
major overhauls during the peak months (presently June, July and August).
Seller shall make reasonable efforts to schedule or reschedule routine
maintenance outside the peak months, and in no event shall outages for
scheduled maintenance exceed 30 peak hours during the peak months. Seller
shall confirm in writing to PGandE pursuant to Article 4, within 24 hours of
S.O. #2
May 7, 1984
C-5
the original notice, all notices Seller gives personally or by telephone for
schedule maintenance.
C-4 ADJUSTMENTS TO CONTRACT CAPACITY
(a) Seller may increase the contract capacity with the approval of
PGandE and receive payment for the additional capacity thereafter in
accordance with the applicable capacity purchase price published by PGandE at
the time the increase is first delivered to PGandE.
(b) Seller may reduce the contract capacity at any time by giving
notice thereof to PGandE, subject to the provisions of Appendix D if the
reduction occurs after the actual operation date. PGandE may reduce the
contract capacity in accordance with Section C-2(e) as a result of appropriate
data showing Seller has failed to meet the performance requirements of Section
C-2. The amount by which the contract capacity is reduced by PGandE shall be
deemed a capacity sale reduction without notice as provided in Section D-3 of
Appendix D.
(c) Either Party may request, when it reasonably appears that the
capacity of the Facility may have changed for any reason, that a new contract
capacity be determined.
S.O. #2
May 7, 1984
C-6
C-5 PAYMENT OPTIONS
Seller has two options for calculation of capacity payments and Seller
has made its selection in Article 3(a). As used below in this section, month
refers to a calendar month. The two options are as follows:
Option 1
When Seller meets the requirements of Section C-2 the monthly payment
for capacity will be one-twelfth of the product of the contract capacity
price, the contract capacity, the appropriate capacity loss adjustment factor
from Table A based on the Facility's interconnection voltage, and the
appropriate performance bonus factor, if any, from Table C. Capacity payments
will continue during scheduled maintenance outages provided that the
provisions of Section C-3 are met.
During a probationary period Seller's monthly payment for capacity shall
be determined by substituting for the contract capacity, the capacity at which
Seller would have met the performance requirements. In any month during the
probationary period that Seller does not meet the performance requirements at
whatever capacity was determined for the previous month, Seller's monthly
payment for capacity shall be determined by substituting the capacity at which
Seller would have met the performance requirements.
S.O. #2
May 7, 1984
C-7
The performance bonus factor shall not be applied during a probationary
period.
Option 2
The monthly payment for capacity will be the product of the Period Price
Factor (PPF), the Monthly Delivered Capacity (MDC), the appropriate capacity
loss adjustment factor from Table A based on the Facility's interconnection
voltage, and the appropriate performance bonus factor, if any, from Table C,
plus any allowable payment for outages due to scheduled maintenance. Firm
capacity prices shall be applied to meter readings taken during the separate
times and periods as illustrated in Table B, Appendix B.
The PPF is determined by multiplying the contract capacity price by the
following Option 2 Allocation Factors ((1)):
Option 2 Contract PPF
Allocation Factor x Capacity Price = ($/kW-month)
Seasonal
Period A .18540 ______________ __________
Seasonal
Period B .01043 ______________ __________
____________________________________
((1)) These allocation factors were prescribed by the CPUC in Decision No.
00-00-000. All allocation factors are subject to change by PGandE
marginal capacity cost allocation, as determined in general rate case
proceedings before the CPUC. Seasonal Periods A and B are defined in
Table B, Appendix B.
S.O. #2
May 7, 1984
C-8
The MDC is determined in the following manner:
(1) Determine the Performance Factor (P), which is defined as the
lesser of 1.0 or the following quantity:
P = ___________A___________ (<= 1.0)
C x (B-S) x (0.8*)
Where:
A = Total kilowatt-hours delivered during all on-peak and partial-peak hours
excluding any energy associated with generation levels greater than the
contract capacity.
C = Contract capacity in kilowatts.
B = Total on-peak and partial-peak hours during the month.
S = Total on-peak and partial-peak hours during the month Facility is out of
service on scheduled maintenance.
(2) Determine the Monthly Capacity Factor (MCF), which is computed
using the following expression:
M
MCF = P x (1.0 - - )
D
Where:
M = The number of hours during the month Facility is out of service on
scheduled maintenance.
D = The number of hours in the month.
____________________________________
* 0.8 reflects a 20% allowance for forced outage.
S.O. #2
May 7, 1984
C-9
(3) Determine the MDC by multiplying the MCF by C:
MDC (kilowatts) = MCF x C
The monthly payment for capacity is then determined by multiplying
the PPF by the MDC, by the appropriate capacity loss adjustment factor
presented from Table A, and by the appropriate performance bonus factor, if
any, from Table C.
monthly payment capacity loss performance
for capacity = PPF x MDC x adjustment factor x bonus factor
Furthermore, the payment for a month in which there is an outage
for scheduled maintenance shall also include an amount equal to the produce of
the average hourly capacity payment ((1)) for the most recent month in the
same type of Seasonal Period (i.e., Seasonal Period A or Seasonal Period B)
during which deliveries were made times the number of hours of outage for
scheduled maintenance in the current month. Capacity payments will continue
during the outage periods for scheduled maintenance provided that the
provisions of Section C-3 are met.
During a probationary period, Seller's monthly payment for
capacity shall be determined by substituting for the contract capacity, the
capacity at which Seller would have met the performance requirements. In
____________________________________
((1)) Total monthly payment divided by the total number of hours in the
monthly billing period.
S.O. #2
May 7, 1984
C-10
the event that during the probationary period Seller does not meet the
performance requirements at whatever capacity was established for the previous
month, Seller's monthly payment for capacity shall be determined by
substituting the capacity at which Seller would have met the performance
requirements. The performance bonus factor shall not be applied during
probationary periods.
TABLE A
If the Facility is non-remote 1 the capacity loss adjustment factors are as
follows:
Capacity Loss
Interconnection Voltage Adjustment Factor
Transmission .989
Primary Distribution .991
Secondary Distribution .991
If the Facility is remote the capacity loss adjustment factor is
___________((1)).
____________________________________
((1)) The Seller acknowledges that this blank cannot be filled in at the time
of executing this Agreement because the information is not yet available
to make a definitive determination of whether the Facility is remote or
non-remote and, if remote, the number to be inserted in this blank.
Seller shall request PGandE to perform a capacity loss adjustment factor
study to be done in its accustomed manner of making such studies to
determine whether the Facility is remote or non-remote and, if remote the
number to be inserted. If the Facility is determined to be non-remote,
N/A shall be inserted.
S.O. #2
May 7, 1984
C-11
TABLE B
Firm Capacity Price Schedule
(Levelized $/kW-year)
Actual
Operation
Date Term of Agreement
(Year) 1 2 3 4 5 6 7 8 9 10
1983 72 111 96 88 84 85 88 91 93 96
1984 156 111 95 88 89 92 95 98 100 103
1985 60 58 59 66 73 79 84 88 92 95
1986 56 58 69 78 85 90 95 99 103 106
1987 61 77 88 95 101 105 109 113 117 120
1988 96 104 110 115* 119 122 126 129 133 136
(Year) 11 12 13 14 15 20 25 30
1983 98 100 102 104 106 115 122 128
1984 105 108 110 112 114 124 131 137
1985 99 102 104 107 110 121* 127* 135
1986 110 113 116 118 121 132 141 148
1987 124 127 130 132 135 147 156 163
1988 139 142 145 148 151 163 173 180
____________________________________
* In its Application for Rehearing and/or Petition for Modification of CPUC
Decision 00-00-000 (dated December 22, 1983) filed on February 6, 1984,
PGandE requests correction of three numbers which were incorrectly
presented in the Firm Capacity Price Schedule included in that decision (p.
349, Table VI-4). The correct number for 1985 for a 20-year contract life
should be $120/kW-yr, and for a 25-year contract life should be $129/kW-yr.
The correct number for 1988 for a 4-year contract life should be $115/kW-
yr. When the CPUC issues an order correcting these numbers, PGandE shall
correct the Firm Capacity Price Schedule accordingly.
S.O. #2
May 7, 1984
C-12
TABLE C
Performance Bonus Factor
The following shall be the performance bonus factors applicable to the
calculation of the monthly payments for capacity delivered by the Facility
after it has demonstrated a capacity factor in excess of 85%.
DEMONSTRATED
CAPACITY FACTOR PERFORMANCE
% BONUS FACTOR
85 1.000
90 1.059
95 1.118
100 1.176
After the Facility has delivered power during the span of all of the
peak months on the PGandE system (presently June, July and August) in any hear
(span),
(i) the capacity factor for each such month shall be calculated in the
following manner:
CAPACITY FACTOR (%) = F x 100
(N-W) x Q
Where:
For Option 1
F = Total kilowatt-hours delivered by Seller in any peak month during
all on-peak hours that Sellers is asked to deliver power to PGandE
S.O. #2
May 7, 1984
C-13
excluding any energy associated with generatin levels greater
than the contract capacity.
N = Total on-peak hours that Seller is asked to deliver power to
PGandE during the month.
W = Total on-peak hours during the peak month that the Facility is
out of service on scheduled maintenance during the on-peak hours
that Seller is asked to deliver power to PGandE.
Q = Contract capacity in kilowatts.
For Option 2
F = Total kilowatt-hours delivered by Seller in any peak month during
all on-peak hours excluding any energy associated with generation
levels greater than the contract capacity.
N = Total on-peak hours during the month.
W = Total on-peak hours during the peak month that the Facility is out
of service on scheduled maintenance.
Q = Contract capacity in kilowatts.
(ii) the arithmetic average of the above capacity factors shall be
determined for that span,
(iii) the average of the above arithmetic average capacity factors for
the most recent span(s), not to exceed 5, shall be calculated and shall become
the Demonstrated Capacity Factor.
S.O. #2
May 7, 1984
C-14
To calculate the performance bonus factor for a Demonstrated
Capacity Factor not shown in Table D use the following formula:
Performance Bonus Factor = Demonstrated Capacity Factor (%)
85%
THE FOLLOWING SECTIONS SHALL APPLY ONLY TO HYDROELECTRIC PROJECTS
C-6 DETERMINATION OF NATURAL FLOW DATA
Natural flow data shall be based on a period of record of at least 50
years and which includes historic critically dry periods. In the event Seller
demonstrates that a natural flow data base of at least 50 years would be
unreasonably burdensome, PGandE shall accept a shorter period of record with a
corresponding reduction in the averaging basis set forth in Section C-8.
Seller shall determine the natural flow data by month by using one of the
following methods:
Method 1
If stream flow records are available from a recognized gauging station
on the water course being developed in the general vicinity of the project,
Seller may use the data from them directly.
S.O. #2
May 7, 1984
C-15
Method 2
If directly applicable flow records are not available, Seller may
develop theoretical natural flows based on correlation with available flow
data for the closest adjacent and similar area which has a recognized gauging
station using generally accepted hydrologic estimating methods.
C-7 THEORETICAL OPERATION STUDY
Based on the monthly natural flow data developed under Section C-6 a
theoretical operation study shall be prepared by Seller. Such a study shall
identify the monthly capacity rating in kW and the monthly energy production
in kWh for each month of each year. The study shall take into account all
relevant operating constraints, limitations, and requirements including but
not limited to --
(1) Release requirements for support of fish life and any other
operating constraints imposed on the project;
(2) Operating characteristics of the proposed equipment of the
Facility such as efficiencies, minimum and maximum operating levels, project
control procedures, etc.;
S.O. #2
May 7, 1984
C-16
(3) The design characteristics of project facilities such as head
losses in penstocks, valves, tailwater elevation levels, etc.; and
(4) Release requirements for purposes other than power generation such
as irrigation, domestic water supply, etc.
The theoretical operation study for each month shall assume an even
distribution of generation throughout the month unless Seller can demonstrate
that the Facility has water storage characteristics. For the study to show
monthly capacity ratings, the Facility shall be capable of operating during
all on-peak hours in the peak months on PGandE system, which are presently the
months of June, July and August. If the project does not have this capability
throughout each such month, the capacity rating in that month of that year
shall be set at zero for purposes of this theoretical operation study.
C-8 DETERMINATION OF AVERAGE DRY YEAR CAPACITY RATINGS
Based on the results of the theoretical operation study developed under
Section C-7, the average dry year capacity rating shall be established for
each month. The average dry year shall be based on the average of the five
years of the lowest annual generation as shown in the theoretical operation
study. Once such years of lowest annual generation are identified, the
monthly capacity rating is determined for each month by averaging the capacity
S.O. #2
May 7, 1984
C-17
ratings from each month of those years. The contract capacity shown in
Article 2(a) shall not exceed the lowest average dry year monthly capacity
ratings for the peak months on the PGandE system, which are presently the
months of June, July and August.
C-9 INFORMATION REQUIREMENTS
Seller shall provide the following information to PGandE for its review:
(1) A summary of the average dry year capacity ratings based on the
theoretical operation study as provided in Table D;
(2) A topographic project map which shows the location of all aspects
of the Facility and locations of stream gauging stations used to determine
natural flow data;
(3) A discussion of all major factors relevant to project operation;
(4) A discussion of the methods and procedures used to establish the
natural flow data. This discussion shall be in sufficient detail for PGandE
to determine that the methods are consistent with those outlined in Section
C-6 and are consistent with generally accepted engineering practices; and
(5) Upon specific written request by PGandE, Seller's theoretical
operation study.
S.O. #2
May 7, 1984
C-18
C-10 ILLUSTRATIVE EXAMPLE
(1) Determine natural flows - These flows are developed based on
historic stream gauging records and are compiled by month, for a long-term
period (normally at least 50 years or more) which covers dry periods which
historically occurred in the 1920's and 30's and more recently in 1976 and 77.
In all but unusual situations this will require application of hydrological
engineering methods to records that are available, primarily from the USGS
publication Water Resources Data for California.
(2) Perform theoretical operation study - Using the natural flow data
compiled under (1) above a theoretical operation study is prepared which
determines, for each month of each year, energy generation (kWh) and capacity
rating (kW). This study is performed based on the Facility's design,
operating capabilities, constraints, etc., and should take into account all
factors relevant to project operation. Generally such a study is done by
computer which routes the natural flows through project features, considering
additions and withdrawals from storage, spill past the project, releases for
support of fish life, etc., to determine flow available for generation. Then
the generation and capacity amounts are computed based on equipment
performance, efficiencies, etc.
S.O. #2
May 7, 1984
C-19
(3) Determine average dry year capacity ratings - After the
theoretical project operation study is complete the five years in which the
annual generation (kWh) would have been the lowest are identified. Then for
each month, the capacity rating (kW) is averaged for the five years to arrive
at a monthly average capacity rating. The contract capacity is then set by
the Seller based on the monthly average dry year capacity ratings and the
performance requirements of Appendix C. An example project is shown in the
attached completed Table D.
S.O. #2
May 7, 1984
C-20
EXAMPLE
TABLE D
Summary of Theoretical Operation Study
Project: New Creek 1 Dispatchable: Yes ___ No __X__
Water Source: West Fork New Creek
Mode of Operation: Run of the river
Type of Turbine: Xxxxxxx Design Flow: 100 cfs Design Head: 150 feet
Operating Characteristics ((1)):
Flow Head (feet) Output Efficiency (%)
(cfs) Gross Net (kW) Turbine Generator
Normal Operation 100 160 150 1,120 90 98
Maximum Operation 110 160 148 1,150 85 98
Minimum Operation 30 160 155 290 75 98
Average Dry Year Operation - Based on the average of the following lowest
generation years: 1930, 1932, 1934, 1949, 1977.
Energy Generation Capacity Output Percent of Total
Month (kWh) (kW) Hours Operated ((2))
January 855,000 1,150 100
February 753,000 1,120 100
March 818,000 1,100 100
April 727,000 1,010 100
May 699,000 940 100
June 612,000 850 100
July 484,000 650 100
August 305,000 410 100
September 245,000 340 100
October 148,800 200 100
November 468,000 650 100
December 595,000 800 100
Maximum Contract Capacity: 410 kW
____________________________________
((1)) If Facility has a variable head, operating curves should be provided.
((2)) For this to be less than 100%, Facility must be dispatchable.
S.O. #2
May 7, 1984
C-21
APPENDIX D
ADJUSTMENT OF CAPACITY PAYMENTS
IN THE EVENT OF TERMINATION OR REDUCTION
CONTENTS
Section Page
D-1 GENERAL PROVISIONS D-2
D-2 TERMINATION WITH PRESCRIBED NOTICE D-4
D-3 TERMINATION WITHOUT PRESCRIBED NOTICE D-5
D-4 TERMINATION EXAMPLES D-6
S.O. #2
May 7, 1984
D-1
APPENDIX D
ADJUSTMENT OF CAPACITY PAYMENTS
IN THE EVENT OF TERMINATION OR REDUCTION
D-1 GENERAL PROVISIONS
(a) This Appendix shall be applicable in the event there is a contract
termination or a capacity sale reduction (each sometimes referred to as
termination in this Appendix D).
(b) The Parties agree that the amount which PGandE pays Seller for the
capacity which Seller makes available to PGandE is based on the agreed value
to PGandE of Seller's performance of capacity obligations during the full
period of the term of agreement. The Parties further agree that in the event
PGandE does not receive such full performance by reason of a termination:
(1) PGandE shall be deemed damaged by reason thereof,
(2) it would be impracticable or extremely difficult to fix the
actual damages to PGandE resulting therefrom,
(3) the refunds and payments as provided in Sections D-2 and
D-3, as applicable, are in the nature of adjustments in capacity prices
and liquidated damages, and not a penalty, and are fair and reasonable,
and
S.O. #2
May 7, 1984
D-2
(4) such refunds and payments represent a reasonable endeavor by
the Parties to estimate a fair compensation for the reasonable losses that
would result from such termination or reduction.
(c) In the event of a capacity sale reduction, the quantity by which
the contract capacity is reduced shall be used to calculate the payments due
PGandE in accordance with Sections D-2 and D-3, as applicable.
(d) Seller shall be invoiced by PGandE for all refunds and payments
due under this Appendix D and the special facilities agreement. From the date
of the notice of termination or the date of termination, whichever is earlier,
Seller shall pay interest, compounded monthly, on all overdue amounts, at the
published Federal Reserve Board three months' Prime Commercial Paper rate.
(e) If Seller does not make payments pursuant to Section D-1(d),
PGandE shall have the right to offset any amounts due it against any present
or future payments due Seller.
(f) Notices of termination shall be made in accordance with Section
A-18 of Appendix A.
S.O. #2
May 7, 1984
D-3
D-2 TERMINATION WITH PRESCRIBED NOTICE
In the event Seller terminates this entire Agreement, or all or part of
the contract capacity thereof, with the following prescribed written notice:
Amount of Contract Capacity Length of
Terminated Notice Required
1,000 kW or under 3 months
over 1,000 kW through 10,000 kW 9 months
over 10,000 kW through 25,000 kW 12 months
over 25,000 kW through 50,000 kW 36 months
over 50,000 kW through 100,000 kW 48 months
over 100,000 kW 60 months
Then the following provisions shall apply:
(1) With respect to the amount by which the contract capacity is
reduced, Seller shall refund to PGandE an amount equal to the difference
between (a) the capacity payments already paid by PGandE, based on the
original term of agreement and (b) the total capacity payments which PGandE
would have paid based on the period of Seller's actual performance using the
adjusted capacity price. Additionally, Seller shall pay interest, compounded
monthly, on all overpayments, at the published Federal Reserve Board three
months' Prime Commercial Paper rate.
(2) From the date PGandE receives the termination notice to the date
of actual termination, PGandE shall make capacity payments based on the
adjusted capacity price for the amount of contract capacity being terminated.
S.O. #2
May 7, 1984
D-4
(3) From the date PGandE receives the termination notice, PGandE shall
continue to pay for the amount of contract capacity not being terminated, if
any, at the original contract capacity price.
D-3 TERMINATION WITHOUT PRESCRIBED NOTICE
(a) If Seller terminates this Agreement, or all or a part of the
contract capacity thereof, without the notice prescribed in Section D-2, the
provisions prescribed in Section D-2 will all apply. Additionally:
(b) Seller shall pay PGandE a sum equal to the amount by which the
contract capacity is being terminated times the difference between the current
firm capacity price on the date of termination for a term equal to the balance
of the term of agreement and the contract capacity price, pro-rated for the
length of notice given by multiplying by the difference between the prescribed
length of notice and the actual notice given, with the difference divided by
12. In the event that the current firm capacity price is less than the
contract capacity price, no payment under this Section D-3 shall be due either
Party.
This additional payment shall be computed using the following formula:
G = CC x (T - CCP) x J - H
12
S.O. #2
May 7, 1984
D-5
Where G >= O
and where:
G = additional payment.
CC = the amount by which the contract capacity is being terminated.
T = the current firm capacity price.
CCP = the contract capacity price.
H = the actual number of months notice given.
J = the prescribed length of notice.
D-4 TERMINATION EXAMPLES
These examples demonstrate how to calculate capacity payment adjustments
when capacity sales are terminated.
(a) Termination with Prescribed Notice
(1) Example Based on Option 1
Assumptions:
i. Term of Agreement is 15 years;
ii. Actual operation date is July 1, 1985;
iii. Prescribed notice is given on July 1, 1986;
S.O. #2
May 7, 1984
D-6
iv. Contract capacity to be reduced by 10,000 kW on July 1 1987;
actual performance to be from July 1, 1985 through July 1, 1987
((1));
v. The applicable capacity loss adjustment factor is .989; and
vi. No performance bonus for capacity has been earned.
The amount of overpayment (E) made by PGandE to Seller during each
monthly billing period is calculated as follows:
E = (A-B) x C x L x U
Where:
A = contract capacity price per month for the actual operation date
(July 1, 1985) and the term of agreement which is 15 years =
$110/kW-yr / 12 mo/yr = $9.17/kW-mo.
B = adjusted capacity price per month for the actual operation date
(July 1, 1984) and a two-year agreement term =
$58/kW-hr / 12 mo/yr = $4.83/kW-mo.
____________________________________
((1)) The capacity payment is adjusted upon receiving notice, so no refund is
necessary for the last month of the first twelve months of operation and
all of the second twelve months (June 1, 1986 to July 1, 1987). Seller
performed for eleven month prior to payment adjustment. (Note that due
to the 30-day interval between delivery and payment, performance in the
twelfth month (June 1986) can be paid for at the adjusted capacity price.
S.O. #2
May 7, 1984
D-7
C = amount by which the contract capacity is being reduced =
10,000 kW.
L = capacity loss adjustment factor = .989.
U = performance bonus factor; when Seller does not qualify for a
performance bonus factor, as in this example, U is removed from
the above calculation of E.
Therefore:
E = ($9.17/kW-mo - $4.83/kW-mo) x 10,000 kW x .989 = $42,923 per
month.
Table A shows a step-by-step derivation of the refund Seller owes
PGandE for the early termination outlined above. The $497,342 that Seller owes
PGandE appears at the lower right-hand corner of the table. All other figures
of this table represent intermediate calculation steps.
S.O. #2
May 7, 1984
D-8
TABLE A
(a) (b) (c) (d) (e) (f) (g)
Interest
Amount Accumu- Charge on
Monthly of lated Accumulated Balance
Billing Date of Over- Over- Interest Overpayment (g) =
Period Payment Payment Payment Rate (f)=(d)x(e) (c)+(d)+(f)
((1)) ((2)) ((3)) ((4)) ((5)) ((6)) ((7))
$ $ % $ $
7/85 8/30/85 42,923 0 1.2 0 42,923
8/85 9/30/85 42,923 42,923 1.0 429 86,275
9/85 10/30/85 42,923 86,275 0.9 776 129,974
10/85 11/30/85 42,923 129,974 0.8 1,040 173,937
11/85 12/30/85 42,923 173,937 0.7 1,218 218,078
12/85 1/30/86 42,923 218,078 0.8 1,745 262,746
1/86 3/ 2/86 42,923 262,746 0.9 2,365 308,034
2/86 3/30/86 42,923 308,034 1.0 3,080 354,037
3/86 4/30/86 42,923 354,037 1.1 3,894 400,854
4/86 5/30/86 42,923 400,854 1.2 4,810 448,587
5/86 6/30/86 42,923 448,587 1.3 5,832 497,342
____________________________________
((1)) The month in which power deliveries were made. For purposes of
simplification, the monthly billing period will coincide exactly with
each calendar month.
((2)) The date on which payment for the monthly billing period state in column
(a) is made.
((3)) The amount of overpayment made by PGandE to Seller during each monthly
billing period.
((4)) The amount of overpayment accumulated up through last month's date of
payment.
((5)) The interest rate for the period between the date of payment for the
previous monthly billing period and the date of payment for this monthly
billing period. These interest rates are arbitrarily chosen for use in
this example.
((6)) The amount of interest charge accrued between the date of payment for the
previous monthly billing period and the date of payment for this monthly
billing period on the accumulated overpayment balance existing as of the
previous monthly billing period's date of payment.
((7)) The amount Seller owes PGandE at this stage of the calculation. The
balance (g) for a given monthly billing period equals the accumulated
overpayment (d) for the monthly billing period immediately following.
S.O. #2
May 7, 1984
D-9
(2) Example Based on Option 2
Assumptions:
i. Term of agreement is 15 years;
ii. Actual operation date is April 1, 1985;
iii. Prescribed notice is given on April 1, 1987;
iv. Contract capacity is reduced by 10,000 kW on April 1,
1988; actual performance is from April 1, 1985 through
April 1, 1988((1));
v. Scheduled outage for maintenance: 18 days = 432 hours
in both November 1985 and November 1986;
vi. The applicable capacity loss adjustment factor is .989;
and
vii. Listed below is Seller's Performance Factor (P), the
Demonstrated Capacity Factor (Y) in % (when measured),
and where applicable, the performance bonus factor (U)
earned for each of the monthly billing periods((2)) prior
to the time capacity payment is adjusted. Also listed
below are the number of hours the Facility was out of
service for schedule maintenance (M) and the number of
hours in the month (D) for each of these months.
____________________________________
((1)) The capacity payment is adjusted upon receiving notice, so no refund is
necessary for the last month of the first twenty-four months of operation
and all of the last twelve months (March 1, 1987 to April 1, 1988).
Xxxxxx performed for twenty-three months prior to payment adjustment.
(Note that due to the 30-day interval between delivery and payment,
performance in the twenty-fourth month (March 1987) can be paid for at
the adjusted capacity price.)
((2)) For purposes of simplification, the monthly billing period will coincide
exactly with each calendar month.
S.O. #2
May 7, 1984
D-10
Monthly Billing Period P Y U M D
April 1985 .85 - - 0 720
May 1985 .95 - - 0 744
June 1985 .90 80 - 0 720
July 1985 1.00 88 - 0 744
August 1985 .90 96 - 0 744
September 1985 1.00 - 1.035* 0 720
October 1985 .96 - 1.035 0 744
November 1985 .98 - 1.035 432 720
December 1985 1.00 - 1.035 0 744
January 1986 1.00 - 1.035 0 744
February 1986 .92 - 1.035 0 672
March 1986 .85 - 1.035 0 744
April 1986 .78 - 1.035 0 720
May 1986 1.00 - 1.035 0 744
June 1986 .94 100 1.035 0 720
July 1986 .95 95 1.035 0 744
August 1986 1.00 92 1.035 0 744
September 1986 1.00 - 1.080** 0 720
October 1986 .93 - 1.080 0 744
November 1986 .84 - 1.080 432 720
December 1986 .88 - 1.080 0 744
January 1987 .94 - 1.080 0 744
February 1987 1.00 - 1.080 0 672
____________________________________
* This performance bonus factor was calculated by averaging the Demonstrated
Capacity Factors for each of the months of June, July and August 1985, and
then dividing that average by 85(%):
U = 80 + 88 + 96 / 85 = 1.035
3
** This performance bonus factor was calculated by averaging the Demonstrated
Capacity Factors for each of the months of June, July and August 1985, and
June, July and August 1986, and then dividing that average by 85(%):
U = 80 + 88 + 96 + 100 + 95 + 92 / 85 = 1.080
6
S.O. #2
May 7, 1984
D-11
The amount of overpayment (E) made by PGandE to Seller during each
monthly billing period is calculated as follows:
E = [P x (1 - M) x K x L x U x (A - B) x C] + [M x R]
D D
Where:
P = performance factor.
M = number of hours of scheduled maintenance for that monthly billing
period.
D = number of hours in that monthly billing period.
K = allocation factor from Section C-5.
L = capacity loss adjustment factor = .989.
U = performance bonus factor; when Seller does not qualify for a performance
bonus factor, U is removed from the above calculation of E.
A = Contract capacity price for the actual operation date (April 1, 1985)
and term of agreement which is 15 years = $110/kW-yr.
B = adjusted capacity price for the actual operation date and a three-year
agreement term = $59/kW-yr.
C = amount by which the contract capacity is being reduced = 10,000 kW.
S.O. #2
May 7, 1985
D-12
R = amount of overpayment for the most recent monthly billing period in
the same Seasonal Period (i.e., Seasonal Period A or Seasonal Period
B).
The results of the calculations are:
Amount of
Monthly Billing Period Overpayment (E)
April 1985 $ 4,472
May 1985 88,838
June 1985 84,163
July 1985 93,514
August 1985 84,163
September 1985 96,787
October 1985 5,227
November 1985 5,271
December 1985 5,445
January 1986 5,445
February 1986 5,009
March 1986 4,628
April 1986 4,247
May 1986 96,787
June 1986 90,980
July 1986 91,948
August 1986 96,787
September 1986 100,995
October 1986 5,284
November 1986 5,079
December 1986 5,000
January 1987 5,341
February 1987 5,682
Table B shows a step-by-step derivation of the refund Seller owes PGandE
for the early termination outlined above. The $1,136,015 that Seller owes
PGandE appears at the lower right-hand corner of the table. All other figures
of this table represent intermediate calculation steps.
S.O. #2
May 7, 1984
D-13
TABLE B
(a) (b) (c) (d) (e) (f) (g)
Interest
Amount Accumu- Charge on
Monthly of lated Accumulated Balance
Billing Date of Over- Over- Interest Overpayment (g) =
Period Payment Payment Payment Rate (f)=(d)x(e) (c)+(d)+(f)
((1)) ((2)) ((3)) ((4)) ((5)) ((6)) ((7))
$ $ % $ $
4/85 5/30/85 4,472 0 1.3 0 4,472
5/85 6/30/85 88,838 4,472 1.4 63 93,373
6/85 7/30/85 84,163 93,373 1.3 1,214 178,750
7/85 8/30/85 93,514 178,750 1.2 2,145 274,409
8/85 9/30/85 84,163 274,409 1.0 2,744 361,316
9/85 10/30/85 96,787 361,316 0.9 3,252 461,355
10/85 11/30/85 5,227 461,355 0.8 3,691 470,273
11/85 12/30/85 5,271 470,273 0.7 3,292 478,836
12/85 1/30/86 5,445 478,836 0.8 3,831 488,112
1/86 3/ 2/86 5,445 488,112 0.9 4,393 497,950
2/86 3/30/86 5,009 497,950 1.0 4,980 507,939
3/86 4/30/86 4,628 507,939 1.1 5,587 518,154
4/86 5/30/86 4,247 518,154 1.2 6,218 528,619
5/86 6/30/86 96,787 528,619 1.3 6,872 632,278
6/86 7/30/86 90,980 632,278 1.4 8,852 732,110
7/86 8/30/86 91,948 732,110 1.4 10,250 834,308
8/86 9/30/86 96,787 834,308 1.3 10,846 941,941
9/86 10/30/86 100,995 941,941 1.2 11,303 1,054,239
10/86 11/30/86 5,284 1,054,239 1.0 10,542 1,070,065
11/86 12/30/86 5,079 1,070,065 1.1 11,771 1,086,915
12/86 1/30/87 5,000 1,086,915 1.1 11,956 1,103,871
1/87 3/ 2/87 5,341 1,103,871 1.0 11,039 1,120,251
2/87 3/30/87 5,682 1,120,251 0.9 10,082 1,136,015
____________________________________
((1)) The month in which power deliveries were made. For purposes of
simplification, the monthly billing period will coincide exactly with
each calendar month.
((2)) The date on which payment for the monthly billing period stated in
column (a) is made.
((3)) The amount of overpayment made by PGandE to Seller during each monthly
billing period.
((4)) The amount of overpayment accumulated up through last month's date of
payment.
((5)) The interest rate for the period between the date of payment for the
previous monthly billing period and the date of payment for this monthly
billing period. These interest rates are arbitrarily chosen for use in
this example.
((6)) The amount of interest charge accrued between the date of payment for
the previous monthly billing period and the date of payment for this
monthly billing period on the accumulated overpayment balance existing
as of the previous monthly billing period's date of payment.
((7)) The amount Seller owes PGandE at this stage of the calculation. The
balance (g) for a given monthly billing period equals the accumulated
overpayment (d) for the monthly billing period immediately following.
S.O. #2
May 7, 1984
D-14
(b) Termination without Prescribed Notice
If Seller terminates without prescribed notice, Seller will owe PGandE a
refund [the calculation of which is described in Sections D-4(a)(1) and D-4(a)
(2) of this example] and payment (G). This example demonstrates how the
payment (G) is calculated. Assumptions:
i. Term of agreement is 15 years;
ii. Actual operation date is July 1, 1985;
iii. Notice is given on January 1, 1990; and
iv. Contract capacity is to be reduced by 10,000 kW on July 1, 1990;
actual performance is from July 1, 1985 through July 1, 1990.
The payment (G) is calculated as follows:
(G) = CC x (T-CCP) x X-X G >= O
12
Where:
CC = The amount of contract capacity being terminated = 10,000 kW.
T = the current firm capacity price $140/kW-yr is arbitrarily chosen
for use in this example for a July 1, 1990 Operation Date and
10-year agreement term.
CCP = the contract capacity price = $110/kW-yr.
H = the actual number of months notice given = six months.
J = the prescribed notice = twelve months.
S.O. #2
May 7, 1984
D-15
The sample calculation is:
G = CC x (T - CCP) x (X-X)
12
G = 10,000 kW x ($140/kW-yr - $110/kW-yr) x
(12 mos. - 6 mos.)
12 mos./yr
G = $150,000
S.O. #2
May 7, 1984
D-16
APPENDIX E
INTERCONNECTION
CONTENTS
Section Page
E-1 INTERCONNECTION TARIFFS E-2
E-2 POINT OF DELIVERY LOCATION SKETCH E-3
E-3 INTERCONNECTION FACILITIES FOR WHICH SELLER IS RESPONSIBLE E-4
S.O. #2
May 7, 1984
E-1
E-1 INTERCONNECTION TARIFFS
(The applicable tariffs in effect at the time of execution of this
Agreement shall be attached.)
S.O. #2
May 7, 1984
E-2
E-2 POINT OF DELIVERY LOCATION SKETCH
The Seller requests, and PGandE consents, that the location sketch not
be made at the time of executing the Agreement, because the Seller,
recognizing that the information is not yet available to make a definitive
determination of the sketch to be inserted here, shall request PGandE to
perform an interconnection study to be done in its accustomed manner of making
such studies to determine the sketch to be inserted.
S.O. #2
May 7, 1984
E-3
E-3 INTERCONNECTION FACILITIES FOR WHICH SELLER IS RESPONSIBLE
The Seller requests, and PGandE consents, that this listing of
facilities not be filled in at the time of executing the Agreement, because
the Seller, recognizing that the information is not yet available to make a
definitive determination of the listing of facilities to be inserted here,
shall request PGandE to perform an interconnection study to be done in its
accustomed manner of making such studies to determine the listing of
facilities to be inserted.
S.O. #2
May 7, 1984
E-4
FIRST AMENDMENT TO POWER PURCHASE
AGREEMENT FOR FIRM CAPACITY AND ENERGY
BETWEEN UNIVERSITY COGENERATION, INC., AND
PACIFIC GAS AND ELECTRIC COMPANY
This First Amendment is entered into as of the 17th day of October, 1985,
between University Cogeneration, Inc., a California corporation, ("Seller"),
and Pacific Gas and Electric Company, a California corporation, ("PGandE"), with
reference to the following:
X. Xxxxxx and PGandE are parties to that certain Power Purchase Agreement
for Firm Capacity and Energy dated April 23, 1985 (the Power Purchase
Agreement);
B. It has come to the attention of Seller and PGandE that Seller's corporate
name was incorrectly set forth in the Power Purchase Agreement as
University Cogeneration Inc., 1985-1 when it should have been set forth as
University Cogeneration, Inc.; and
X. Xxxxxx and PGandE wish to amend the Power Purchase Agreement to correctly
set forth Seller's corporate name.
NOW, THEREFORE, in consideration of the mutual agreements contained in the
Power Purchase Agreement and herein, the parties agree as follows:
1. Effective from the execution date of the Power Purchase Agreement,
such agreement is amended to the extent that all references to Seller
as University Cogeneration Inc., 1985-1 shall be deemed to be references
to Seller as University Cogeneration, Inc.
1
IN WITNESS WHEREOF the parties have caused this Amendment to be signed.
UNIVERSITY COGENERATION, INC.
Date Signed: October 16, 1985 By: /s/ Xxxx X. Xxxxx
Name: Xxxx X. Xxxxx
Title: Vice President
PACIFIC GAS AND ELECTRIC COMPANY
Date Signed: October 17, 1985 By: /s/ Xxxxx X. Xxxxxx
Name: Xxxxx X. Xxxxxx
Title: Vice President
2
SECOND AMENDMENT TO
POWER PURCHASE AGREEMENT
FOR FIRM CAPACITY AND ENERGY
BETWEEN UNIVERSITY COGENERATION, INC., AND
PACIFIC GAS AND ELECTRIC COMPANY
DATED APRIL 23, 1985
On April 23, 1985 PACIFIC GAS AND ELECTRIC COMPANY ("PGandE") and
UNIVERSITY COGENERATION, INC. ("Seller") entered into a Standard offer No. 2
Power Purchase Agreement ("Agreement") for the 38,000 kW cogeneration project
located at Section 28, Township 12 north, Range 24 west, 1/2 miles south of
Xxxx, Xxxx County, California.
PGandE and Seller in consideration of the mutual agreements herein, and
other good and valuable considerations, hereby amend said Agreement as
follows:
1. ARTICLE 2 - PURCHASE OF POWER
Paragraph (a) - The blank in the first sentence is replaced with 115 kV
to reflect the energy delivery voltage level:
"(a) Seller shall sell and deliver and PGandE shall
purchase and accept delivery of firm capacity and energy at the
voltage level of 115 kV as indicated below
1
Paragraph (d) - The blank in this paragraph is replaced with 46.7 MVA
to reflect the physical limitations of the project interconnection
facilities:
"(d) To avoid exceeding the physical limitations of the
interconnection facilities., Seller shall limit the
Facility's actual rate of delivery into the PGandE system to
46.7 MVA."
Paragraph (g) - The blank in this paragraph is replaced with "not
applicable" to reflect the fact that the meters have been placed on
PGandE's side of the transformer:
"(g) The transformer loss adjustment factor is not applicable."
2. Appendix C - FIRM CAPACITY PRICE SCHEDULE
Section C-5, Table A, page C-11 - The sentence following this table
shall be replaced with the following:
"The Facility is non-remote and the capacity loss adjustment factor
is 0.989."
2
3. Appendix E - INTERCONNECTION
The entire appendix shall be replaced- by the following to include the
Electric Rule No. 21 in effect at the time of execution of the
Agreement,the Point of Delivery Location sketch and the List of
Interconnection Facilities for which Seller is Responsible:
3
APPENDIX E
INTERCONNECTION
CONTENTS
Section Page
E-1 INTERCONNECTION TARIFFS E-2
E-2 POINT OF DELIVERY LOCATION SKETCH E-3
E-3 INTERCONNECTION FACILITIES FOR WHICH E-4
SELLER IS RESPONSIBLE
4
E-1 INTERCONNECTION TARIFFS
(The applicable tariffs in effect at the time of execution of this
Agreement shall be attached.
5
THIRD AMENDMENT
TO THE
FIRM CAPACITY AND ENERGY
POWER PURCHASE AGREEMENT
BETWEEN
UNIVERSITY COGENERATION, INC.
AND
PACIFIC GAS AND ELECTRIC COMPANY
THIS THIRD AMENDMENT is by and between UNIVERSITY COGENERATION INC.
("Seller"), and PACIFIC GAS AND ELECTRIC COMPANY ("PG&E"), a California
corporation. It amends the Firm capacity and Energy Power Purchase Agreement
signed on April 23, 1985 by PG&E and on April 16, 1985 by University
Cogeneration, Inc. for the 38,000 kW cogeneration facility located at Section
28, Township 12N., Range 24W, 3-1/2 miles South of Xxxx, Xxxx County,
California (the "Agreement"). PG&E and Seller are sometimes referred to
herein collectively as the "Parties".
WHEREAS, by letter dated June 2, 1988, Seller notified PG&E that it
elected to decrease the contract firm capacity to 32,000 kW, in accordance
with Section C-4(b), Appendix C, of the Agreement; and
WHEREAS, the Parties desire to amend the Agreement to reflect the
foregoing.
1
NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained herein, PG&E and Seller hereby agree as follows:
1. The term "34,000 kW" shall be deleted from page 4, line 6,
Article 2(a), PURCHASE OF POWER, of the Agreement and replaced
by the term "32,000 kW".
2. All other provisions of the Agreement remain unchanged.
3. All underlined terms used herein shall have the same meanings
as defined in the Agreement.
4. This Third Amendment shall be construed and interpreted in
accordance with the laws of the State of California, excluding
any choice of law rules that may direct the application of the
laws of another jurisdiction.
IN WITNESS WHEREOF, the Parties hereto have caused this Third
Amendment to be signed by their authorized representatives, and it is effective
as of the last date set written below.
UNIVERSITY COGENERATION, INC. PACIFIC GAS AND ELECTRIC COMPANY
BY: /s/ X.X. Xxxxxxxxx By: /s/ Xxxxxx X. Xxxxx
Name: X.X. Xxxxxxxxx Name: Xxxxxx X. Xxxxx
Title: Vice President Title: Manager, QF Contracts
Date Signed: April 26, 1989 Date Signed: May 19, 1989
2
