FirstEnergy Nuclear Generation
Corp.
Exhibit
10.8
FERC Electric Tariff, Original
Volume No. 1
[Execution Copy]
NUCLEAR POWER SUPPLY
AGREEMENT
Between
FirstEnergy Nuclear Generation Corp., Seller
and
FirstEnergy
Solutions Corp., Buyer
This Nuclear Power Supply
Agreement ("Agreement") dated October 14, 2005 is made by and
between FirstEnergy Nuclear Generation Corp., ("FENGenco" or
"Seller"), and FirstEnergy Solutions Corp. ("Solutions" or
"Buyer"). FENGenco and Solutions may be identified collectively as
"Parties" or individually as a "Party." This Agreement is entered
into in connection with the transfer of the ownership interests of
The Cleveland Electric Illuminating Company, Ohio Edison Company,
Pennsylvania Power Company, and The Toledo Edison Company in the
Beaver Valley Power Station, Davis-Besse Nuclear Power Station, and
Perry Nuclear Power Plant (“Nuclear Generating Plants”)
to FENGenco.
WHEREAS, Seller is a newly
formed, nuclear generation only company that intends to acquire
certain interests in Nuclear Generating Plants owned by The
Cleveland Electric Illuminating Company, Ohio Edison Company,
Pennsylvania Power Company, and The Toledo Edison Company
(collectively "the FirstEnergy Operating Companies");
and
WHEREAS, Seller will be a
wholly owned subsidiary of FirstEnergy Corp; and
WHEREAS, the Nuclear Generating
Plants are operated by FirstEnergy Nuclear Operating Company, a
wholly owned subsidiary of FirstEnergy Corp. and affiliate of
FENGenco; and
WHEREAS, Seller will also
purchase the electrical output of Ohio Edison Company and The
Toledo Edison Company’s sale/leaseback interests in Beaver
Valley Power Station Unit 2 and Perry Nuclear Power Plant
(“Leased Nuclear Generation Facilities”);
and
WHEREAS, Seller will be engaged
exclusively in the business of owning the Nuclear Generating Plants
and selling Power from the owned Nuclear Generating Plants and
Leased Nuclear Generation Facilities (collectively, the
“Nuclear Generating Facilities”) at wholesale;
and
WHEREAS, Buyer desires to
obtain the entire electric output of the Nuclear Generating
Facilities, pursuant to the rates, terms and conditions set forth
herein.
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Issued by: Gary R. Leidich,
President
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Effective
Date:
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Issued on: October 14,
2005
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December 1,
2005
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It is agreed as
follows:
I.
TERM
The sale and purchase of Power
pursuant to this Agreement shall begin on December 1, 2005, or such
later effective date authorized by the FERC, for an initial term
ending December 31, 2010. This Agreement shall remain in effect
from year to year thereafter unless terminated by either Party upon
at least sixty days written notice prior to the end of the calendar
year.
II.
SALE AND PURCHASE OF CAPACITY AND ENERGY
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A.
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Seller shall provide Buyer all
of the Capacity, Energy, and Ancillary Services available from the
Nuclear Generating Facilities identified in Exhibit C to this
Agreement, and Buyer shall purchase and pay for such Capacity,
Energy, and Ancillary Services, in accordance with the terms of
this Agreement. Seller shall make Capacity, Energy, and Ancillary
Services available at the Delivery Points. Buyer shall arrange and
will be responsible for all transmission, congestion costs, losses,
and related services at and from the Delivery Points. The Capacity,
Energy, and Ancillary Services, supplied by Seller are collectively
referred to as Buyer's "Power Supply Requirements." Capacity and
Energy supplied shall be sixty-hertz, three phase alternating
current. The Power Supply Requirements will be provided in
accordance with Good Utility Practice, and where applicable, the
provisions of the applicable Transmission Provider OATT, and the
requirements of the NRC.
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B.
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FENGenco shall cause the
Nuclear Generating Facilities to be operated and maintained in
accordance with Good Utility Practice, the applicable requirements
of the FERC, NRC and NERC, as well as the requirements of the
regional reliability councils or Regional Entity, and Regional
Transmission Organizations where the Nuclear Generating Facilities
are located. FENGenco will enter into agreements with FirstEnergy
Nuclear Operating Company, other FirstEnergy affiliates,
Transmission Provider, or Government Authority if necessary to
ensure compliance with this Section II.B.
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III.
SCHEDULING AND SYSTEM
PLANNING
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A.
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In order for Solutions to be
able to plan adequately to market and sell all of the Capacity,
Energy, and Ancillary Services, available from the Nuclear
Generating Facilities identified in Exhibit C, FENGenco shall
notify Solutions on or before November 1 of each year during the
term of this Agreement of the amount of Capacity, Energy, and
Ancillary Services, it expects to have available for each day in
each month of the next calendar year. The information provided in
this notification shall include, but not be limited to, the time
and expected duration of any planned outage of the Nuclear
Generating Facilities.
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B.
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FENGenco shall update its
annual forecast of available Capacity, Energy, and Ancillary
Services for any change or expected change in the operation of the
Nuclear Generating Facilities that would materially affect the
annual forecast provided to Solutions. FENGenco shall provide the
updated forecast to Solutions for any full month(s) remaining in
the calendar year within thirty days of becoming aware of the
change or expected change in the operation of the Nuclear
Generating Facilities.
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C.
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FENGenco will supply Solutions,
upon request, any such information as is necessary to meet the
requirements of the applicable Transmission Provider OATT, FERC,
NERC, NRC, Electric Reliability Organization, regional reliability
council, Regional Entity or Government Authority.
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IV.
PRICE
Seller shall charge, and Buyer
shall pay, for Buyer's Power Supply Requirements, as follows on a
monthly basis.
A. Charges
Buyer will pay Seller the
Monthly Charge under the cost-based formula set forth in Exhibit A
for the Power Supply Requirements available from the Nuclear
Generating Facilities identified in Exhibit C.
B.
Billing and Payment
Unless otherwise specifically
agreed upon by the Parties, the calendar month shall be the
standard period for all billings and payments under this Agreement.
As soon as practicable after the end of each month, the Seller will
render an invoice to Buyer for the amounts due for Power Supply
Requirements for the preceding month. Payment shall be due and
payable within ten days of receipt of the invoice or, if such day
is not a Business Day, then on the next Business Day. Buyer will
make payments by electronic funds transfer or by other mutually
agreeable method(s) to the account designated by Seller. Any
amounts not paid by the due date will be deemed delinquent and will
accrue interest at the Interest Rate until the date of payment in
full.
Each Party shall keep complete
and accurate records of its operations under this Agreement and
shall maintain such data as may be necessary to determine the
reasonableness and accuracy of all relevant data, estimates,
payments or invoices submitted by or to it hereunder. All records
regarding this Agreement shall be maintained for a period of three
years from the date of the invoice or payment, or for such longer
period as may be required by law.
D. Audit
and Adjustment Rights
Buyer shall have the right, at
its own expense and during normal business hours, to audit the
accounts and records of Seller that reasonably relate to the
provision of service under this Agreement. If the audit reveals an
inaccuracy in an invoice, the necessary adjustment in such invoice
and the payments therefore will be promptly made. No adjustment
will be made for any invoice or payment made more than one year
from rendition thereof. This provision shall survive the
termination of this Agreement for a period of one year from the
date of termination for the purpose of such invoice and payment
objections. To the extent that audited information includes
Confidential Information, the Buyer shall keep all such information
confidential under Section VII.C.
E. Section
205 Rights
Nothing contained herein shall
be construed as affecting in any way the right of the Party
furnishing service under this Agreement to unilaterally make
application to the FERC for a change in rates under Section 205 of
the Federal Power Act and pursuant to the FERC's Rules and
Regulations thereunder. Provided, however, that nonrate terms and
conditions may be amended only by a written agreement signed by the
Parties.
V.
METERING
Generation metering will be
installed, operated and maintained in accordance with the
applicable generator interconnection agreements between the
FENGenco, Transmission Provider, and Transmission Owner. Metering
between control areas shall be handled in accordance with the
applicable Transmission Provider OATT. Retail metering shall be
provided in accordance with applicable state law.
