Exhibit 10.6
CONFIDENTIAL
ELECTRIC SERVICE CONTRACT
This Contract is made this December 15, 2006 by and between MIDAMERICAN
ENERGY COMPANY, an Iowa corporation (herein referred to as "Company"), and
SOUTHWEST IOWA RENEWABLE ENERGY, LLC (herein referred to as "Customer").
The parties hereby agree as follows:
Article I. Scope
The Company shall supply electric service to the premises occupied by the
Customer at 000xx Xx., Xxxxxxx Xxxxxx, Xxxx 00000. In recognition of the
benefits to be derived by the Customer under this Contract, Customer agrees to
purchase all the electrical requirements of the facility's connected electric
load as of the date the permanent electric service is energized and will average
a monthly billing demand of 7,300 kilowatts for each month during the term of
this Contract. The Customer may elect to install onsite standby generation which
it shall operate to serve a portion or all of the connected load in the event
and for the duration that the Company is unable to supply electric services to
the premises or to comply with interruptions as they relate to Rider 2 and/or
Rider 12. Customer may use onsite standby generation to meet obligations for
curtailment under Rider 2 or Rider 12 only if the generation is used purely as
an emergency standby power supply per the Company's tariff.
Article II. Primary Electric Service
A. Company will construct, own and operate a 161 kV transmission
line, a new 161 - 13 kV substation with a power transformer, 13
kV circuit breakers and feeder exits, and 13 kV underground
feeders in customer provided conduit from the substation to the
Customer's 13 kV switchgear,. The transmission line will be a
radial feed coming from the CBEC-Xxxxxxx 161 kV line using a
three-way switch arrangement. As installed for Phase 1, these
facilities will be able to handle up to 12 MW of load.
i. Customer agrees to provide two (2) acres of land for
Company's sole use to install an electric distribution
substation. Customer will provide a warranty deed for this
property to Company for the sum of one dollar. The preferred
location will be adjacent to the existing transmission line
conductor and will be mutually agreeable to both
parties. If, within twenty-five years of the effective date
of service under this Contract, Company no longer uses said
property for electric distribution purposes, Company agrees
to deed said property back to Customer.
B. Customer will be served and metered at a nominal 13,200 volts.
Customer will own and operate the 13 kV switchgear with metering
bay, all distribution transformers, and all 13 kV and low voltage
cable on the Customer's side of the switchgear.
C. Interruptible Power incentives may be available to the Customer
under the Terms and Conditions of Rider 2 and/or the Terms and
Conditions of Rider 12. As set forth in Company's tariffs as
approved by the Iowa Utilities Board, the Company reserves the
right to limit participation to a state-wide total of 190,000 kW
of curtailable load.
i. If momentary paralleling (not open transition) is considered
for standby generation, Company's Technical Requirements for
Interconnection of Generation to the MidAmerican Energy
Company Distribution System Specifications (TRIMECS), must
be followed and completed in its entirety. Depending on
technical requirements, Customer may incur additional costs
to fulfill the obligations of the TRIMECS specifications.
Failure to comply with all TRIMECS specifications shall be a
breach of this Contract. The Terms and Conditions of Rider 2
and/or the Terms and Conditions of Rider 12 shall not apply
unless all TRIMECS specifications have been met.
Article III. Electricity Pricing
A.
1. Pursuant to the terms of Company's Rider FP, Flexible Pricing,
the Customer shall receive and pay for firm electric service as
shown in Exhibit 1. Service under this contract will commence on
the date the permanent electric service is energized. Service
under Exhibit 1 will continue for up to 60 consecutive months but
not beyond June 30, 2012.
2. Flexible pricing has been established under the assumption that
the Customer will have an average billing demand of 7,300
kilowatts and will average an 85% load factor over a 12-month
period. If this load is not met, Customer must return to the most
applicable tariff rate.
B. Notwithstanding the foregoing, Customer, at its election, at any time
during the term of this Contract may forego the terms as set forth above and
take service under one of the Company's electric tariffs
Article IV. Miscellaneous
A. In the event of any conflict between the terms and conditions of this
Contract and the Company's General Tariffs' terms and conditions, the terms and
Conditions of this Contract shall prevail. Customer expressly recognizes that
the rates, riders, terms and conditions applicable to this Contract are subject
to modification by the Iowa Utilities Board or any other regulatory agency
having jurisdiction and that such modification shall not relieve the Customer of
its duty to comply with same. Company agrees not to suggest changes to terms of
this Contract, which changes are specific only to this Contract, in proceedings
dealing with Company's rates, riders, terms and conditions before the Iowa
Utilities Board or other regulatory agency having jurisdiction. Furthermore,
Company shall defend the terms specific only to this Contract in any proceeding
to review such terms. If necessary, Customer agrees to assist Company in
obtaining regulatory approval of this Contract and in defending the terms
specific to this Contract.
B. The rates and charges specified hereunder apply only to the primary
voltage electric service provided to the Customer's premises, which are the
subject of this Contract.
C. Each provision of the Contract is severable and if any provision shall
be finally determined to be invalid, illegal or unenforceable ("invalid") in any
jurisdiction, the remaining provisions shall not be affected thereby, nor shall
said provision be invalid in any other jurisdiction.
D. This Contract shall inure to the benefit of, and be binding upon, the
parties hereto and their successors and assigns. This Contract shall not be
assigned or transferred by either party without the prior written consent of the
other party, which consent shall not be unreasonably withheld, except that no
consent shall be required for any assignment or transfer by merger,
consolidation or reorganization, or as part of a transfer of all or
substantially all of the assets of the assignor or transferor, or to any
affiliate of such party. For the purposes of this Section, an affiliate shall
constitute any corporation or legal entity which (i) is owned or controlled by,
(ii) owns or controls or (iii) is owned or controlled by the corporation or
other legal entity owning or controlling, either of the parties to this
Contract. Any person which succeeds by purchase, merger or consolidation of the
Customer's premises which are the subject of this Contract or the Company's
business, substantially as an entirety, shall be entitled to the rights and
shall be subject to the obligations of its predecessor under this Contract. The
restriction on assignment contained in this Section shall not prevent either
party from pledging or mortgaging its rights hereunder as security for its
indebtedness. Customer shall not by assignment alter the point of delivery for
electric service provided in accordance with this Contract.
E. The following actions shall each constitute a breach under the terms of
this Contract. In the event either party 1) commences a voluntary case under any
chapter of the Bankruptcy Code (Title 11, United State Code), or takes any
equivalent or similar action by filing a petition under any other federal or
state law in effect at such time relating to bankruptcy or insolvency, or if a
petition is filed against breaching party under any chapter of the Bankruptcy
Code, or if a petition is filed seeking any such equivalent or similar relief
against breaching party under any other federal or state law in effect at the
time relating to bankruptcy; 2) makes a general assignment for the benefit of
creditors; 3) admits in writing an inability to pay its debts generally as they
become due; 4) has appointed (voluntarily or involuntarily) a trustee, receiver,
custodian or agent under applicable law or under contract, whose appointment or
authority to take charge of property or the breaching party for the purpose of
general administration or such property for the benefit of the breaching party's
creditors; or 5) commits a material breach of any of the terms or provisions of
this Contract and such breach is not cured within thirty (30) business days
after written notice to the breaching party advising of such breach. To the
extent a party has committed a breach as set forth above; the non-breaching
party is relieved of all further duties under this Contract, provided the
non-breaching party has first notified the other party of its intent to cease
performance. Notwithstanding the foregoing, in the event Customer's breach
results in its secured creditors assuming the operation of the facility that is
the subject of the Contract, the secured creditors may also succeed to the
rights and responsibilities of the Customer for this Contract; provided,
however, such assumption and acceptance shall be in writing, for the remainder
of the term of the Contract, and shall include assumption and fulfillment of all
outstanding or incomplete duties of Customer hereunder.
F. The rights of the parties hereto may not be waived except in writing
signed by the waiving party. A waiver by either party of any of its rights under
this Contract or any breach of this Contract shall not be construed as a waiver
of any other or future rights or breaches.
G. THIS CONTRACT AND ITS PERFORMANCE BY BOTH PARTIES SHALL BE INTERPRETED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF IOWA AND SHALL BE SUBJECT TO ALL
APPLICABLE RULES AND REGULATIONS OF REGULATORY AUTHORITIES HAVING JURISDICTION.
Article V. Captions
A. Title or captions of articles, sections, or paragraphs contained in
this Contract are inserted only as a matter of convenience and for reference,
and in no way define, limit, extend or describe the scope of this Contract or
the intent of any provision thereof.
Article VI. Confidentiality
A. Neither party shall disclose this Contract, or any portion thereof, to
any person, without the prior written permission of the other party.
Notwithstanding the foregoing a party may disclose the Contract (1) to its
officers, directors and employees, (2) upon the request or demand of any
regulatory agency or authority having jurisdiction over such party, (3) to the
party's legal counsel and independent auditors, (4) to the extent reasonably
required in connection with any litigation to which such party or its affiliates
may be a party, (5) to any actual or proposed lender to such party, or (6) as
may otherwise be required by law. If a party breaches the Contract by disclosing
this Contract, or any portion thereof, the non-disclosing party shall have the
option of terminating the Contract upon written notice, but no termination by
Company shall prevent Customer from obtaining service under Company's electric
tariffs. If this Contract or any portion thereof is disclosed to, or filed with
any regulatory body or disclosed as otherwise required by law, the disclosing or
filing party shall request the regulatory body, other entity or person receiving
the Contract or any portion thereof, to afford the Contract, or the portion
thereof, confidential treatment and, concurrently with the filing or disclosure,
shall advise the other party of the filing or disclosure provided that Company
shall not be required to advise Customer of any filing or disclosure to the Iowa
Utilities Board, the Illinois Commerce Commission, the Federal Regulatory Energy
Commission, or their successor agencies.
Article VII. Notice
A. Notice shall be deemed delivered when personally delivered or when
deposited in the United States certified or registered mail, return receipt
request, postage prepaid or when receive from an overnight courier and addressed
to Customer at 000xx Xx., Xxxxxxx Xxxxxx, Xxxx 00000 or Company at:
Director-Energy Consultants and Energy Efficiency, MidAmerican Energy Company,
000 Xxxx Xxxxxx Xxxxxx, Xxxxxxxxx, XX 00000, or at such other address designated
in writing by either party from time to time to the other party.
IN WITNESS WHEREOF, the parties hereto have caused this Contract to be
duly executed in duplicate as of the day and year first above written.
MIDAMERICAN ENERGY COMPANY SOUTHWEST IOWA RENEWABLE ENERGY LLC
By /s/ Xxxxx X. Xxxxxx By /s/ Xxxxx Xxxx
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Name Xxxxx X. Xxxxxx Name Xxxxx Xxxx
Title VP-Quality Assurance & Key Accounts Title Chairman
Exhibit 1
Electric Price Schedule
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PRICES: Summer Winter
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Service Charge per meter $200.00 $200.00
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Demand Charge times kW of measured
demand for customers with primary
metering, but not less than 200
kW
$3.38/kW $2.89/kW
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Reactive Demand Charge per kVAR of
reactive demand in excess of 50% of
billing demand $0.49/kVAR $0.49/kVAR
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Energy Charge:
First 250 hours x kW of demand $0.03647/kWh $0.03157/kWh
Next 150 hours x kW of demand $0.02577/kWh $0.02577/kWh
Over 400 hours x kW of demand $0.01837/kWh $0.01837/kWh
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Tax Adjustment: Subject to the Tax
Adjustment. See Sheet No. C-2.
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AEP and Energy Efficiency Cost
Recovery Adjustments: These will
appear as charges to the xxxx.They
are calculated on a per kWh basis.
See Sheet Nos.C-1 and C-3 for more
details.
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CNS Capital Additions Tracker: This
is calculated on a per kWh basis.
See Sheet No. C-4 for more details.
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AVAILABLE: Southwest Iowa Renewable Energy - Council Bluffs, IA
APPLICABLE: At the option of the customer, to all electric service required on
premises by customer, subject to applicable terms and conditions of the
Company's Electric Service Policies and Electric Rate Application. Applicable to
standby or supplementary service (under written agreement only) in conjunction
with applicable Company riders for such service.
DEMAND: The kW as shown by or computed from the readings of the Company's demand
meter for the 15-minute period of the customers' greatest use during the month,
determined to the nearest kW, but not less than 200 kW.
REACTIVE DEMAND: The kVAR as shown by or computed from the readings of the
Company's
reactive demand meter, determined to the nearest kilovar. The customer is not
billed for reactive demand unless the customer's power factor is less than
89.44% lagging, equivalent to situations where kVAR of reactive demand exceed 50
percent of billing demand. The power factor will be based on the highest kW
demand and kVAR demand for the billing period.
Exhibit 1 (Continued)
SEASONAL PROVISION: Summer and winter periods are defined as: Summer, June through
September billing periods; and Winter, October through May billing periods.
MINIMUM XXXX: The service charge, plus the highest summer demand during the past
12 months multiplied by the demand charge, plus the cost of fuel (including
amounts in base prices plus amounts in the energy cost adjustment), plus the tax
and energy efficiency cost recovery adjustments.
TAX ADJUSTMENT: This rate is subject to the Tax Adjustment; see Sheet No. C-2.
PAYMENT: Bills are due and payable within twenty days from the date the xxxx is
rendered to the customer. When not so paid the xxxx is delinquent and a late
payment charge, which is equal to 1.5 percent per month of the past due amount
or such portion that remains unpaid after each subsequent month, shall be added.
