Exhibit 10.2
AMENDMENT TO THE
POWER PURCHASE AGREEMENT
BETWEEN
BYRON POWER PARTNERS, L.P.
AND
PACIFIC GAS AND ELECTRIC COMPANY
(PG&E LOG NO. 16C047)
THIS
AMENDMENT ("Amendment") is by and between PACIFIC GAS AND
ELECTRIC
COMPANY ("PG&E"), a California corporation and Byron Power
Partners, L.P., a
California limited partnership ("Seller"). PG&E and Seller are
sometimes
referred to herein individually as "Party" and collectively as the
"Parties"
RECITALS
A.
On April 15, 1985, Seller (or Seller's predecessor, as applicable)
and
entered into a Power Purchase Agreement, (as amended, "the PPA")
pursuant to
which PG&E purchases electric power from Seller and Seller
sells electric power
to PG&E.
B.
On April 6, 2001, PG&E filed voluntary petition under chapter
11 of the
United States Bankruptcy Code in the San Francisco Division of the
United States
Bankruptcy Court for the Northern District of California (the
"Bankruptcy
Court") (In re Pacific Gas and Electric Company, Banks. Case No.
01-03923).
C.
On June 14, 2001, the Commission issued D.01-06-015, which approved
as
reasonable certain non-standard PPA price modifications.
D.
Seller and PG&E now desire to enter into the PPA price
modification set
forth below. Seller has advised PG&E that Seller is unable to
enter into the
PPA price modification unless the Bankruptcy Court has approved
this Amendment
and Seller is provided a limited option to terminate this Amendment
following
Bankruptcy Court approval if Seller is unable to
1 of 3
<PAGE>
Arrange for fuel purchases to accommodate the price modification
contemplated
under this Amendment.
AMENDMENT
In
consideration of the mutual promises and covenants contained
herein,
PG&E and Seller agree to as follows:
1.
INTERIM ENERGY PRICE
Unless otherwise set fourth in the PPA, for the period commencing
with the
date on which this Amendment has been executed by the Parties and
ending upon
the commencement of the Fixed Rate Period, as defined in Section 2
below, the
price for energy delivered, if any, to PG&E by Seller shall be
determined
pursuant to the PPA, without reference to this Amendment.
2.
FIXED ENERGY PRICE
Commencing with this date that is the earlier of, August 1, 2001,
August
16, 2001 or September 1, 2001 following approval of the Bankruptcy
Court as
specified in Section 4 below (hereafter, the "Bankruptcy Court
Approval Date")
and ending on July 15, 2006 (this period referred to hereafter as
the "Fixed
Rate Period"), Seller elects to replace the energy price term
specified in the
PPA (PG&E's "full short-run avoided costs" or "full short-run
avoided operating
costs" as the case may be) with the applicable energy prices as
specified in
Attachment A. No provision of the PPA other than the energy price
term is or
shall be deemed to be modified, amended, waived or otherwise
affected by this
Amendment. The parties agree to reasonably cooperate and contest
any challenge
in any Commission proceeding that seeks to alter or modify the
energy pricing
terms set fourth in Attachment A, including, but not limited to any
challenge to
the reasonableness of PG&E having entered into this
Amendment.
2 of 3
<PAGE>
3.
SELLER'S OPTION PERIOD
For
a fifteen-day period following the Bankruptcy Court Approval
Date,
Seller shall have the sole right to terminate this Amendment. Upon
termination
of this Amendment pursuant to this section 3, this Amendment shall
be deemed a
nullity.
4.
EFFECTIVENESS
This
Amendment shall not become effective unless and until it has
been
approved by the Bankruptcy Court. If the Bankruptcy Court has not
approved this
Amendment by August 31, 2001, this Amendment shall be deemed a
nullity.
5.
SIGNATURES
IN
WITNESS WHEREOF, Seller and PG&E have caused this Amendment to
be
executed by their authorized representatives.
PACIFIC GAS AND ELECTRIC COMPANY
a California
corporation
By:
[illegible]
-------------------------
Title: [illegible]
-------------------------
Date: 7/14/01
-------------------------
BYRON POWER PARTNERS, L.P.
a California limited partnership
By:
[illegible]
-------------------------
Title: Ex VP & COO
-------------------------
Date: 7/13/01
-------------------------
3 of 3
<PAGE>
Pacific Gas and Electric Company
June 1, 1993
[LOGO OMITTED] ALTAMONT COGENERATION
CORPORATION
Attn: Bob Pollock
c/o Wankesha-Pearce
12320 South Main
HOUSTON, TX 77235-5068
Dear Sir/Madam:
This is to notify you of a change of address for Article 9,
"Notices", of the Power Purchase Agreement (PPA) between
PG&E
and Altamont Cogeneration Corporation. Please direct all
future written notices to:
Mr. Richard A. Lavne
Director, Power Finance Department, B13D
Pacific Gas and Electric Company
77 Beale Street, Room 1311
P.O. Box 770000 San
Francisco, CA 94177
The address in the PPA relating to insurance matters has also
changed. All insurance certificates, endorsements.
cancellations, terminations, alterations, and material changes
of such insurance must be issued and submitted to the
following:
Pacific Gas and Electric Company
Power Contracts Department - B23C
Attn: Insurance Coordinator
P.O. Box 770000, Room 2354
San Francisco, CA 94177
CPUC Decision
93-04-001 dated April 7, 1993, adopted the
Division of Ratepayer Advocate's recommendation for modifying
the reporting requirements applicable to the quarterly report
of negative avoided cost or hydro spill. The above decision
ordered that: Decision (D) 82-01-103, Ordering Paragraph 17,
is modified to read in full as follows:
"Each utility shall promptly file a report for any
quarter in which a negative avoided cost or hydro
spill condition occurs."
Please inform all parties in your organization of the above
information. If you have any questions please call me at (415)
973-4966.
Sincerely,
/s/ Dave Harrison
Dave Harrison
Power System Analyst
(415)973-4966
<PAGE>
PACIFIC GAS AND
ELECTRIC COMPANY
STANDARD OFFER #4
POWER PURCHASE AGREEMENT
FOR
LONG-TERM ENERGY AND CAPACITY
Seller: Fayette Manufacturing Corporation
Location: Altamont Pass
Nameplate Rating: 6,500 kW
Firm
Capacity: 5,700 kW
Energy Source: Natural Gas
MAY 1984
S.O #4
May 7, 1984
1
<PAGE>
STANDARD OFFER #4:
LONG-TERM ENERGY AND CAPACITY
POWER PURCHASE AGREEMENT
CONTENTS
Article
Page
-------
----
1
QUALIFYING STATUS
3
2
COMMITMENT OF PARTIES
4
3
PURCHASE OF POWER
5
4
ENERGY PRICE
6
5
CAPACITY ELECTION AND CAPACITY PRICE
10
6
LOSS ADJUSTMENT FACTORS
11
7
CURTAILMENT
11
8
RETROACTIVE APPLICATION OF CPUC ORDERS
12
9
NOTICES
12
10
DESIGNATED SWITCHING CENTER
13
11
TERMS AND CONDITIONS
13
12
TERM OF AGREEMENT
14
Appendix A:
GENERAL TERMS AND CONDITIONS
Appendix B:
ENERGY PAYMENT OPTIONS
Appendix C:
CURTAILMENT OPTIONS
Appendix D:
AS-DELIVERED CAPACITY
Appendix E:
FIRM CAPACITY
Appendix F:
INTERCONNECTION
2
S.O #4
May 7, 1984
<PAGE>
LONG-TERM ENERGY AND CAPACITY
POWER PURCHASE AGREEMENT
BETWEEN
FAYETTE MANUFACTURING CORPORATION
AND
PACIFIC GAS AND ELECTRIC COMPANY
FAYETTE MANUFACTURING CORPORATION, a Pennsylvania corporation
("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' 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, at seq.).
---------------
1
Underlining identifies those terms which are defined in Section S-1
of
Appendix A.
3
S.O #4
May 7, 1984
<PAGE>
ARTICLE 2
COMMITMENT OF PARTIES
The prices to be paid Seller for energy and/or capacity
delivered
pursuant to this Agreement have wholly or partly been fixed at the
time of
execution. Actual avoided costs at, the time of energy and/or
capacity
deliveries may be substantially above or below the prices fixed in
this
Agreement. Therefore, the Parties expressly commit to the prices
fixed in
this
Agreement for the applicable period of performance and shall not
seek
to
or have a right to renegotiate such prices for any reason. As part
of
its
consideration for the benefit of fixing part or all of the
energy
and/or capacity prices under this Agreement, Seller waives any and
all
rights to judicial or other relief from its obligations and/or
prices set
forth in Appendices B, D, and E, or modification of any other term
or
provision for any reasons whatsoever.
This Agreement contains certain provisions which set forth methods
of
calculating damages to be paid to PGandE in the event Seller fails
to
fulfill certain performance obligations. The inclusion of such
provisions
is
not intended to create any express or implied right in Seller
to
terminate this Agreement prior to the expiration of the term of
agreement.
Termination of this Agreement by Seller prior to its expiration
date shall
constitute a breach of this Agreement and the damages expressly set
forth
in
this
4
S.O #4
May 7, 1984
<PAGE>
Agreement shall not constitute PGandE's sole remedy for such
breach.
ARTICLE 3 PURCHASE OF POWER
(a) Seller shall sell and deliver and PGandE shall purchase and
accept
delivery of capacity and energy at the voltage level of 115 kW.
(b) Seller shall provide capacity and energy from its 6,500 kW
Facility located in the Altamont Pass.
(c) The scheduled operation date of the Facility is February 1,
1987.
At
the end of each calendar quarter Seller shall give written notice
to
PGandE of any change in the scheduled operation date.
(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 6,500 kW.
(e)
The primary energy source for the Facility is natural gas.
5
S.O #4
May 7, 1984
<PAGE>
(f) If Seller does not begin construction of its Facility by
November
30,
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
ARTICLE 4 ENERGY PRICE
PGandE shall pay Seller for its surplus energy output2 under
the
energy payment option checked below3:
X
Energy Payment Option 1 - Forecasted Energy Prices
-
-----------------
1
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.
In addition, a line loss percentage to the low side meter will
be
determined by the Parties and added to the transformer loss
adjustment
factor.
2
Insert
either "net energy output" or "surplus energy output" to show
the energy sale option selected by Seller.
3
Energy
Payment option 2 is not available to oil or gas-fired
cogenerators.
6
S.O #4
May 7, 1984
<PAGE>
During the fixed price period, Seller shall be paid for energy
delivered at prices equal to 01 percent of the prices set forth in
Table
B-1,
Appendix B, plus 1002 percent of PGandE's full short-run
avoided
operating costs.
For the remaining years of the term of agreement, Seller shall be
paid
for
energy delivered at prices equal to PCandE's full short-run
avoided
operating costs.
If Seller's Facility is not an oil or gas-fired cogeneration
facility,
Seller may convert from Energy Payment Option 1 to Energy Payment
option 2
and
be subject to the conditions therein, provided that Seller shall
not
change the percentage of energy prices to be based on PGandE's
full
short-run avoided operating costs. Such conversion must be made at
least 90
days
prior to the date of initial energy deliveries and must be made
by
written notice in accordance with Section A-17, Appendix A.
_____ Energy Payment
Option 2 - Levelized Energy Prices
-----------------
(1)
Insert either 0, 20,
40, 60, 80, or 100, at Seller's option. If
Seller's Facility is an oil or gas-fired cogeneration facility,
either
0 or 20 must be inserted.
(2)
Insert the difference
between 100 and the percentage selected under
footnote 1 above.
7
S.O #4
May 7, 1984
<PAGE>
During the fixed price period, Seller shall be paid for energy
delivered at prices equal to ________ 1 percent of the levelized
energy
prices set forth in Table B-2, Appendix B for the year in which
energy
deliveries begin and term of agreement, plus ___________2 percent
of
PGandE's full short-run avoided operating costs. During the fixed
price
period, Seller shall be subject to the conditions and terms set
forth in
Appendix B, Energy Payment Option 2.
For the
remaining years of the term of agreement, Seller shall be paid
for
energy delivered at prices equal to PGandE's full short-run
avoided
operating costs.
Seller may convert from Energy Payment Option 2 to Energy Payment
Option 1,
provided that Seller shall not change the percentage of energy
prices to be
based on PGandE's full short-run avoided operating costs. Such
conversion must
be made at least 90 days prior to the date of initial energy
deliveries and must
be made by written notice in accordance with Section A-17, Appendix
A.
-----------------
1
Insert
either 20, 40, 60, 80, or 100, at Seller's option.
2
Insert the
difference between 100 and the percentage selected under
footnote 1 above.
8
S.O #4
May 7, 1984
<PAGE>
_____ Energy Payment
Option 3 - Incremental Energy Rate
Beginning with the date of initial energy deliveries and
continuing
until ______________1, seller shall be paid monthly for energy
delivered at
prices equal to PGandE's full short-run avoided operating costs,
provided
that
adjustments shall be made annually to the extent set forth in
Appendix
B,
Energy Payment Option 3.
The incremental Energy Rate Band widths specified by Seller in
Table I
below shall be used in determining the annual adjustment, if
any.
Table I
-------
Year
Incremental Energy Rate Band Widths
----
-----------------------------------
(must be multiples of 100 or zero)
1984
-------------
1985
-------------
1986
-------------
1987
-------------
1988
-------------
1989
-------------
1990
-------------
1991
-------------
1992
-------------
1993
-------------
1994
-------------
1995
-------------
1996
-------------
1997
-------------
1998
-------------
-----------------
1
Specified by Seller must be
December 31, 1998 or prior.
9
S.O #4
May 7, 1984
<PAGE>
After __________, Seller shall be paid to: energy delivered at
prices
equal to PGandE's full short-run, avoided operating costs.
ARTICLE 5 CAPACITY ELECTION AND CAPACITY PRICE
Seller may elect to deliver either firm capacity or
as-delivered
capacity, and Seller's election is indicated below. PGandE's prices
fox
firm
capacity and as-delivered capacity die derived from PGandE's
full
avoided costs as approved by the CPUC.
X
Firm capacity -
5,700 kW for 30 years from the firm capacity
availability date with payment determined in accordance with
Appendix E. Except for hydro- electric facilities, PGandE shall
pay Seller for capacity delivered in excess of firm capacity on
an as-delivered capacity basis in accordance with As-Delivered
Capacity Payment Option 1 set forth in Appendix D.
OR
__
As-delivered capacity
with payment determined in accordance with
As-Delivered Capacity Payment Option set forth in Appendix D.
10
S.O #4
May 7, 1984
<PAGE>
ARTICLE 6 LOSS ADJUSTMENT FACTORS
Capacity Loss Adjustment Factors shall be as shown in Appendix D
and
Appendix E, dependent upon Seller's capacity election set forth in
Article
5 of
this Agreement.
Energy Loss Adjustment
Factors shall be considered as unity for all
energy payments related to Energy Payment Options I and 2 set forth
in
Appendix B for the entire fixed price period of this Agreement,
except for
the
percentage of' payments that Seller elected in Article 4 to
have
calculated based on PGandE's full short-run avoided operating
costs. Energy
Loss
Adjustment Factors for all payments related to PGandE's full
short-run
avoided operating costs are subject to CPUC rulings for the entire
term of
agreement.
ARTICLE 7 CURTAILMENT
Seller has two options regarding possible curtailment by PGandE
of
Seller's deliveries, and Seller's selection is indicated below:
X
Curtailment Option A - Hydro Spill
and Negative Avoided Cost
--
__
Curtailment
Option B - Adjusted Price Period
The two options are described in Appendix C.
11
S.O #4
May 7, 1984
<PAGE>
ARTICLE 8 RETROACTIVE APPLICATION OF CPUC ORDERS
Pursuant to Ordering Paragraph l (f) of CPUC Decision No.
83-09-054
(September 7, 1983), after the effective date of the CPUC's
Application
B2-03-26 decision relating to line loss factors, Seller has the
option to
retain the relevant terms of this Agreement or have the results of
that
decision incorporated into this Agreement. To retain the terms
herein,
Seller shall provide written notice to PGandE within 30 days after
the
effective date of the relevant CPUC decision on Application
82-03-26.
Failure to provide such notice will result in the amendment of
this
Agreement to comply with that decision.
As soon as practicable following the issuance of a decision in
Application 82-03-26, PGandE shall notify Seller of the effective
date
thereof and its results.
ARTICLE 9 NOTICES
All written notices shall be directed as follows:
To PGandE: Pacific Gas and
Electric Company
Attention: Vice President -
Electric Operations
77 Beale Street
San Francisco, CA 94106
12
S.O #4
May 7, 1984
<PAGE>
To Seller:
Fayette Manufacturing Corporation
Attention: Arthur C. Beard
P.O. Box 1149
Tracy, CA 95376
ARTICLE 10 DESIGNATED SWITCHING CENTER
The
designated PGandE switching center shall be, unless changed by
PGandE:
Tesla Substation
Patterson Pass Road
Tracy, CA 95376
(209)835-6391
ARTICLE 11 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 PAYMENT OPTIONS
Appendix C -
CURTAILMENT OPTIONS
Appendix D -
AS-DELIVERED CAPACITY
Appendix E -
FIRM CAPACITY
Appendix F -
INTERCONNECTION
13
S.O #4
May 7, 1984
<PAGE>
Article 12 TERM OF AGREEMENT
This Agreement shall be binding upon execution and remain in
effect
thereafter for 30 years' from the firm capacity availability
date2;
provided, however, that it shall terminate if energy deliveries do
not
start within five years of the execution date.
IN WITNESS WHEREOF, the Parties hereto have caused this Agreement
to
be
executed by their duly authorized representatives- and it is
effective
as
of the last date set forth below.
FAYETTE MANUFACTURING CORPORATION
PACIFIC GAS AND ELECTRIC COMPANY
BY:/s/ JOHN S. PRESTON
BY: /s/ NOLAN H. DAINES
-------------------
-------------------
JOHN S. PRESTON
NOLAN H. DIANES
Vice President -
TITLE: General Counsel
TITLE: Planning and Research
DATE
SIGNED: April 12, 1985
DATE SIGNED: 4/15/85
--------------
-------
------------
1 The
minimum contract term is 15 years and the maximum contract
term is 30 years.
2 Insert
"firm capacity availability date" if Seller has elected to
deliver firm capacity or "date of initial energy deliveries" if
Seller has elected to deliver as-delivered capacity.
14
S.O #4
May 7, 1984
<PAGE>
APPENDIX A
GENERAL TERMS AND CONDITIONS
CONTENTS
Section
Page
-------
-----
A-1
DEFINITIONS
A-2
A-2
CONSTRUCTION
A-7
A-3
OPERATION
A-11
A-4
PAYMENT
A-14
A-5
ADJUSTMENTS OF PAYMENTS
A-15
A-6
ACCESS TO RECORDS AND PGandE DATA
A-15
A-7
INTERRUPTION OF DELIVERIES
A-16
A-8
FORCE MAJEURE
A-16
A-9
INDEMNITY
A-17
A-10
LIABILITY; DEDICATION
A-18
A-11
SEVERAL OBLIGATIONS
A-19
A-12
NON-WAIVER
A-19
A-13
ASSIGNMENT
A-19
A-14
CAPTIONS
A-20
A-15
CHOICE OF LAWS
A-20
A-16
GOVERNMENTAL JURISDICTION AND
A-20
AUTHORIZATION
A-17
NOTICES
A-21
A-18
INSURANCE
A-21
A-1
<PAGE>
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:
Adjusted firm capacity price - The $/kW-year purchase price for
firm
capacity from Table E-2, Appendix E for the period of Seller's
actual
performance.
As-delivered capacity - Capacity delivered to PGandE in excess of
firm
capacity or in lieu of a firm capacity commitment.
CPUC - The Public Utilities Commission of the State of
California.
Current firm capacity price - The $/kW-year capacity price from
PGandE's firm capacity price schedule effective at the time PGandE
Berates
the
firm capacity pursuant to Section E-4(b), Appendix E or Seller
terminates performance under this Agreement, for a term equal to
the period
from
the date of deration or termination to the end of the term of
agreement.
A-2
<PAGE>
Designated PGandE switching center - That switching center or
other
PGandE installation identified in Article 10.
Facility - That generation apparatus described in Article 3 and
all
associated equipment owned, maintained, and operated by Seller.
Firm capacity - That capacity, if any, identified as firm in
Article 5
except as otherwise changed as provided herein.
Firm capacity availability 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
firm
capacity continuously into PGandE's system as provided in this
Agreement.
Firm capacity price - The price for firm capacity applicable for
the
firm
capacity availability date and the number of years of firm
capacity
delivery from the firm capacity price schedule, Table E-2, Appendix
E.
A-3
<PAGE>
Firm capacity price schedule - The periodically published schedule
of
the
$/kW-year prices that PGandE offers to pay for firm capacity. See
Table
E-2,
Appendix E.
Fixed price Period - The period during which forecasted or
levelized
energy prices, and/or forecasted as-delivered Capacity prices, are
in
effect; defined as the first five years of the term of agreement if
the
term
of agreement is 15 or 16 years; the first six years of the term
of
agreement if the term of agreement is 17, 18, or 19 years; or the
first ten
years of the term of agreement if the term of agreement is anywhere
from 20
through 30 years.
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.
Full short-run avoided operating costs - CPUC-approved costs which
are
the
basis of PGandE's published energy prices. PGandE's current
energy
price calculation is shown in Table B-5, Appendix B. PGandE's
published
off-peak hours' prices shall be adjusted, as appropriate, if Seller
has
selected Curtailment Option B.
A-4
<PAGE>
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.
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.
A-5
<PAGE>
Scheduled operation date - The day specified in Article 3 (c) when
the
Facility is, by Seller's estimate, expected to produce energy 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.
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.
A-6
<PAGE>
Term of agreement - The number of years this Agreement will remain
in
effect as provided in Article 12.
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
Seller hereby grants to PGandE all necessary rights of way and
easements, including adequate and continuing access rights on
property of
Seller, to install, operate, maintain, replace, and remove the
special
facilities. Seller agrees to execute such other grants, deeds, or
documents
as
PGandE may require to enable it to record such rights :of way
and
easements. If any part of 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 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
A-7
<PAGE>
reimburse PGandE for all costs 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 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
F,
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 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
A-8
<PAGE>
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.
(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.
A-9
<PAGE>
(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 Seller's side of the transformer, an estimated
transformer loss
adjustment factor of 2 percent, unless the Parties agree otherwise,
will be
applied.
A-10
<PAGE>
A-3
OPERATION
A-3.1 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
interconnection
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.
A-3.2 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-11
<PAGE>
A-3.3 Point of
Delivery
Seller shall deliver the energy at the point where Seller'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 F.
A-3.4 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, scheduled and
unscheduled shutdowns, equipment clearances, levels of operating
voltage or
power factors 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.
A-12
<PAGE>
(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 require Seller to
telemeter
transmission 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.
A-3.5 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.
A-13
<PAGE>
(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.
A-3.6 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-4
PAYMENT
PGandE shall mail to Seller not later than 30 days after the end
of
each
monthly billing period (1) a statement showing the energy and
capacity
A-14
<PAGE>
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-5, if within 30 days of receipt of the
statement
Seller does not make a report in writing to PGandE of an error,
Seller
shall be deemed to have waived any error in PGandE's statement,
computation, and payment, and they shall be considered correct
and
complete.
A-5
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-3.6 to recompute the amount due from PGandE to Seller for
the
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-6
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
A-15
<PAGE>
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.
A-7
INTERRUPTION OF DELIVERIES
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
PGandE system emergencies, forced outages, force majeure, or
compliance
with
prudent electrical practices; provided that PGandE shall not
interrupt
deliveries pursuant to this section in order to take advantage, or
make
purchases, of less expensive energy elsewhere. Whenever possible,
PGandE
shall give Seller reasonable notice of the possibility that
interruption or
reduction of deliveries may be required.
A-8
FORCE MAJEURE
(a) The term force majeure as used herein means unforeseeable
causes,
other than forced outages, beyond the reasonable control of and
without
A-15
<PAGE>
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,
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
A-16
<PAGE>
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 E-2(c), Appendix E.
(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-9
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, 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
A-17
<PAGE>
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-l0
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 noncooperation of the other
Party's
facilities, and' such other Party shall not be liable for
