Exhibit 10.23.2
SEVENTIETH AGREEMENT AMENDING
NEW ENGLAND POWER POOL AGREEMENT
(ISO CAPITAL FUNDING TARIFF)
THIS SEVENTIETH AGREEMENT AMENDING NEW ENGLAND POWER POOL AGREEMENT,
dated as of February 2, 2001 ("Seventieth Agreement"), amends the New England
Power Pool Agreement (the "NEPOOL Agreement"), as amended.
WHEREAS, the NEPOOL Agreement as in effect on December 1, 1996 was
amended and restated by the Thirty-Third Agreement Amending New England Power
Pool Agreement dated as of December 1, 1996 (the "Thirty-Third Agreement") in
the form of the Restated New England Power Pool Agreement ("Restated NEPOOL
Agreement") attached to the Thirty-Third Agreement as Exhibit A thereto, and the
Thirty-Third Agreement also provided for the NEPOOL Open Access Transmission
Tariff (the "NEPOOL Tariff") which is Attachment B to the Restated NEPOOL
Agreement; and
WHEREAS, the Restated NEPOOL Agreement and the NEPOOL Tariff have
subsequently been amended numerous times, with such amendments most recently
consolidated, respectively, in FERC Electric Third Revised Rate Schedule No. 5,
submitted in Docket No. ER00-2894-000, and FERC Electric Tariff, Fourth Revised
Volume No. 1, submitted in Docket Nos. EL00-62-000, et al.; and
WHEREAS, the Participants desire to amend the NEPOOL Agreement as
heretofore amended, to reflect the revisions detailed herein.
NOW, THEREFORE, upon approval of this Seventieth Agreement by the
NEPOOL Participants Committee in accordance with the procedures set forth in the
NEPOOL Agreement, the Participants agree as follows:
SECTION 1
AMENDMENTS TO NEPOOL AGREEMENT
1.1 The following sentence is inserted at the end of the first
paragraph of Section 19.2 of the NEPOOL Agreement:
Commencing with the effectiveness of the ISO's Tariff
for Capital Funding (the "ISO Capital Funding
Tariff"), the ISO's capital expenses and capitalized
project costs are paid by the ISO using either funds
provided through third party financing of those
expenses or funds provided by the Participants under
the ISO Capital Funding Tariff and have ceased to be
NEPOOL expenses.
1.2 Section 19.3(d) of the NEPOOL Agreement is amended to read as
follows:
(d) The Restructuring Expense incurred on or after
January 1, 2000 (the "Late Restructuring Expense")
shall be funded for each month, on an as incurred
basis, by the Participants to the extent that the ISO
does not obtain an alternative source of funds for
certain portions of the Late Restructuring Expense.
In 2000, such Late Restructuring Expense shall
initially be funded for each month by the
Participants in proportion to their charges under the
ISO Tariff for the prior month. In 2001 and
thereafter, on an as-incurred basis, the ISO shall
allocate the incrementally incurred Late
Restructuring Expense among the various schedules to
the ISO Tariff that is in effect at that time in a
manner that best matches the elements comprising the
incrementally incurred Late Restructuring Costs to
the types of service to be covered by each schedule
to the ISO Tariff, and the portion of the Late
Restructuring Expense to be funded by the
Participants that has been allocated to each such
schedule to the ISO Tariff for such year shall be
funded in each month by the Participants in
proportion to their charges under such schedule for
the prior month; provided, however, that in the event
that the Commission accepts (i) an amendment to the
ISO Agreement (as defined in Section 20(a) hereof)
providing that in the event of a termination or
resignation of the ISO, all assets purchased by the
ISO with funds provided by the Participants for which
the Participants have not been reimbursed shall be
transferred without further consideration (to the
extent permitted by applicable tax and other laws) to
the Participants or their designee (which amendment
shall be mutually acceptable to the ISO and the
Participants Committee) and (ii) the ISO Capital
Funding Tariff, an amendment to the ISO Tariff or a
separate tariff for the ISO pursuant to which the ISO
collects thereunder certain expenses that would
otherwise be considered to be portions of the Late
Restructuring Expense, such expenses shall be funded
directly under the ISO Capital Funding Tariff, the
ISO Tariff or such separate tariff for the ISO, as
appropriate, shall not be considered part of the Late
Restructuring Expense and shall not be initially
collected hereunder. Each item of the Late
Restructuring Expense funded by the Participants in
each calendar year shall be amortized in equal
monthly amounts and repaid to the Participants and/or
other Entities which previously funded an
unreimbursed portion of such item of the Late
Restructuring Expense over a period of time
determined by the ISO in accordance with generally
accepted accounting principles in effect at the time
of determination and taking into consideration the
depreciation period, if any, of the particular asset
giving rise to such item of the Late Restructuring
Expense, such repayment to include interest thereon
from the date of payment at the rate of 10.78% per
annum. For each item of the Late Restructuring
Expense funded by the Participants (regardless of
whether it was incurred before, on or after January
1, 2001) and during the time in which amounts are
being amortized and repaid for such item, the ISO
shall determine to which schedule or schedules of the
then effective ISO Tariff such item relates, and the
ISO, acting as agent for the Participants and/or
other Entities initially providing the funding for
such item, shall recover the amounts being repaid
that are associated with such item plus accrued
interest from the Participants using the allocation
-2-
methodology set forth in such schedule or schedules
to the ISO Tariff. The ISO shall provide the amounts
recovered to the applicable Participants and/or other
Entities according to which Participants and/or other
Entities initially funded the item of the Late
Restructuring Expense for which the subject amounts
have been recovered.
1.3 Section 19.3(f) is inserted in the NEPOOL Agreement, directly after
Section 19.3(e) of the NEPOOL Agreement, reading as follows:
(f) Each capital expenditure or capitalized project cost of the
ISO that is funded by the Participants under the ISO Capital
Funding Tariff, the ISO Tariff or a separate tariff of the
ISO, including without limitation any capital expenditure or
capitalized project cost that was originally paid through a
third party financing facility and is subsequently being
funded by the Participants due to a termination or
acceleration of such facility (including interest and fees
related thereto) (each an "ISO Capital Expense"), shall be
amortized in equal monthly amounts and repaid to the
Participants and/or other Entities which previously funded an
unreimbursed portion of such ISO Capital Expense over a period
of time determined by the ISO in accordance with generally
accepted accounting principles in effect at the time of
determination and taking into consideration the depreciation
period, if any, of the particular asset giving rise to such
item of the Late Restructuring Expense. With respect to ISO
Capital Expenses that are funded by the Participants as a
result of the termination or acceleration of a financing
facility, such amortization and repayment period shall take
into account, to the extent appropriate, the date the
applicable asset or assets were originally put into service
and the remaining depreciation period thereof. Repayment under
this Section 19.3(f) shall include interest on the amounts
being repaid from the date of the original payment at the rate
of 10.78% per annum. For each ISO Capital Expense, and during
the time in which amounts are being amortized and repaid for
such item, the ISO shall determine to which schedule or
schedules of the then effective ISO Tariff such ISO Capital
Expense relates, and the ISO, acting as agent for the
Participants and/or other Entities initially providing the
funding for such ISO Capital Expense, shall recover the
amounts being repaid that are associated with such ISO Capital
Expense plus accrued interest from the Participants using the
allocation methodology set forth in such schedule or schedules
to the ISO Tariff. The ISO shall provide the amounts recovered
to the applicable Participants and/or other Entities according
to which Participants and/or other Entities initially funded
the ISO Capital Expense for which the subject amounts have
been recovered.
1.4 Section 20(b) of the NEPOOL Agreement is amended to read as follows:
The fees and charges of the ISO (other than those recovered
under the ISO Tariff, the ISO Capital Funding Tariff, any
other tariff of the ISO, and fees
-3-
and charges for services which are separately billed), and any
indemnification payable under the ISO Agreement, shall be
shared by the Participants in accordance with Section 19.
1.5 The fourth sentence of Section 20(d) of the NEPOOL Agreement is amended
to read as follows:
Unless otherwise agreed by the Participants, any funding by
the Participants of the acquisition, or lease, of land,
structures, fixtures, equipment and facilities, and other
capital and/or capitalized project related expenditures, or
the acquisition of other assets, and the ownership thereof, or
the obligations of Participants as lessees, shall be in
accordance with Section 19.3 of this Agreement, the ISO
Tariff, the ISO Capital Funding Tariff or a separate tariff
for the ISO.
1.6 The following is added at the end of Section 20(d) of the NEPOOL
Agreement:
Without limiting the generality of the foregoing in the event
of the termination, removal or resignation of the ISO, the ISO
shall transfer to the Participants or their designee, subject
to any necessary landlord or other consents being obtained and
subject to PUHCA approval to the extent such transfer requires
PUHCA approval, all of its right, title and interest in and to
all land, structures, fixtures, equipment and facilities, and
other capital assets, and all software and other intellectual
property or rights to intellectual property or other assets
that have been acquired or developed by the ISO using funds
provided by the Participants (whether initially or upon a
termination or acceleration of a third party financing and
whether provided under this Agreement, the ISO Capital Funding
Tariff, the ISO Tariff or a separate tariff of the ISO) for
which the Participants have not been fully reimbursed (such
right, title and interest being referred to as the
"Transferred Interest"). If the transferee of the Transferred
Interest is a tax-exempt Section 501(c)(3) or Section
501(c)(4) organization for federal income taxation purposes,
such transfer will be without consideration to the ISO; if
such transferee is NEPOOL, NEPOOL shall purchase such
Transferred Interest at a price equal to (x) the fair market
value of the portion of the Transferred Interest that is owned
or leased by the ISO (but not the portion of the Transferred
Interest that is owned or leased by the Participants ), as
determined by an independent MAI appraiser with the requisite
background and experience in the field (the "FMV") minus (y)
the amount of funds previously provided by the Participants
for such portion of the Transferred Interest that is owned or
leased by the ISO Assets for which the NEPOOL Participants
have not been reimbursed; and if such transferee is neither
NEPOOL nor a tax-exempt Section 501(c)(3) or Section 501(c)(4)
organization, such transferee shall purchase the Transferred
Interest at a
-4-
price equal to the FMV; provided, however, that in no event
shall the purchase price for the Transferred Interest be less
than zero.
SECTION 2
AMENDMENTS TO NEPOOL TARIFF
2.1 In the second paragraph of the Financial Assurance Policy for NEPOOL
Members included as Attachment L to the NEPOOL Tariff (the "Member
Financial Assurance Policy"), a footnote is inserted at the end of the
phrase "including amounts owed to ISO New England Inc. under its
tariff," and the text of that footnote reads as follows:
For purposes of this Policy, including all attachments hereto,
the "tariff" of ISO New England Inc. includes any and all
tariffs of ISO New England Inc., including without limitation
its Tariff for Transmission Dispatch and Power Administration
Services and its Tariff for Capital Funding.
2.2 In Attachment 2 (Sample Performance Bond) to the Member Financial
Assurance Policy, the second paragraph is amended to read as follows:
WHEREAS, the Principal has entered into agreements for the
purchase and sale of electric services and the payment of
amounts owed to ISO New England Inc. and its share of the
expenses of the New England Power Pool under the Restated
NEPOOL Agreement, the Restated NEPOOL Open Access Transmission
Tariff, ISO New England Inc.'s Tariff for Transmission
Dispatch and Power Administration Services and ISO New England
Inc.'s Tariff for Capital Funding, each as amended from time
to time (collectively referred to as the "Agreements"), and in
strict accordance with their respective terms.
2.3 The first sentence of Section 1.1 of the New England Power Pool Billing
Policy included as Attachment N to the NEPOOL Tariff (the "Billing
Policy") is amended to read as follows:
The objective of this Policy is to define the billing and
payment procedures to be utilized in administering charges and
payments due under the NEPOOL Agreement, the NEPOOL Tariff,
the Interim Independent System Operator Agreement (the "ISO
Agreement") between NEPOOL and ISO New England Inc. (the
"ISO"), the ISO's Tariff for Capital Funding (the "ISO Capital
Funding Tariff"), and the ISO"s Tariff for Transmission
Dispatch and Power Administration Services (the "ISO Tariff"),
in each case as amended, modified, supplemented and restated
from time to time (collectively, the "Documents").
2.4 Section 2.3(c) of the Billing Policy is amended to read as follows:
-5-
c) ISO Tariff Charges. The Charges owed by the Participant or
Non-Participant Transmission Customer under the ISO Tariff
and/or the ISO Capital Funding Tariff, categorized by the
tariff and section or schedule under which such Charges arise.
2.5 Section 3.3(a) of the Billing Policy is amended to read as follows:
a) ISO Charges Paid First. The ISO shall use monies received by
it from Participants and Non-Participant Transmission
Customers to pay all amounts due to the ISO under the ISO
Tariff, the ISO Capital Funding Tariff and the ISO Agreement
before making any payments to any Participants or
Non-Participant Transmission Customers.
SECTION 3
MISCELLANEOUS
3.1 This Seventieth Agreement shall become effective on May 5, 2001 or on
such other date as the Commission shall provide that the amendments
reflected herein shall become effective.
3.2 Terms used in this Seventieth Agreement that are not defined herein
shall have the meanings ascribed to them in the NEPOOL Agreement.
-6-
