20120817Attachments to XRG 45.pdf

Jean Jewell
From:
Sent:
To:
Cc:
Subject:
Attachments:
Griswold , Bruce fMkt Function) (Bruce.Griswold~PacifiCorp.com)
Monday, May 11 , 2009 5:26 PM
James T. Carkulis
Younie, John; 'Ken Kaufmann
RE: contracts
11 May09 draft Idaho MAG PPAdoc; Re: PURPA contract requests
James
Please find the attached draft Idaho standard QF PP A to be used for a wind project. It should include all the
recent Idaho commission orders. It does not include Addendum W which is the bolt-on addendum for an off-
system project delivering to PacifiCorp. I will send that separately. Per our last communication (attached), we
indicated PacifiCorp does not have sufficient transmission at Borah or Brady to accept any project greater than
23MW and you selected one project, XRG-DP 10, that would be developed into a PP A. Please provide
redline to this document with your proposed changes for discussion. If you or your team, have questions on the
PP A, please call.
Bruce Griswold
PacifiCorp C&T
503-813-5218 Office
503-702-1445 Cell
503-813-6260 Fax
From: James T. Carkulis (mailto:mtli(Ci)in-tch.com
Sent: Monday, May 11, 2009 5:35 AM
To: Griswold, Bruce \Mkt Function!
Subject: contracts
Bruce:
In January, PacifiCorp agreed the strategy with XRG was to have all 6 contract requests before the IPUC by the end of
April. To date, not one draft has been tendered by PacifiCorp. We realize these are exciting times and all are very busy,
but all the Aurora work should have been accomplished on JR1 and Jack Ranch by now, the 4 drafts on XRG-DP 7 thru
10 should be in our hands for review.
We would appreciate if we could receive these contracts for review and comment to move to execution.
Thank you.
Regards
James T. Carkulis
Confidential & Proprietary
Successfully Merging Free Market Principles with Societal Expectations
Exergy Development Group, llC
(p) 208.336.9793
(I) 208.336.9431
(m) 406.459.3013
(e) mtlilG1in-tch.com
This electronic or printed document contains information which (a) may be lEGAllY PRIVilEGED, PROPRIETARY IN NATURE, OR OTHERWISE PROTECTED
BY lAW FROM DISClOSU RE, and (b) is intended only for the use of the Addressee(s) named above. If the reader of this message is not the intended recipient
or the employee or agent responsible to deliver it to the intended recipient , you are hereby notified that any dissemination, distribution or copying of this
communication is strictly prohibited. If you have received this communication in error, please immediately notify us by telephone, and return the original message
to us at the above address via first class, express mail. Thank you
Jean Jewell
From:
Sent:
To:
Cc:
Subject:
Attachments:
Griswold , Bruce fMkt Function) (Bruce.Griswold~PacifiCorp.com)
Monday, May 11 , 2009 5:26 PM
James T. Carkulis
Younie, John; 'Ken Kaufmann
RE: contracts
11 May09 draft Idaho MAG PPAdoc; Re: PURPA contract requests
James
Please find the attached draft Idaho standard QF PP A to be used for a wind project. It should include all the
recent Idaho commission orders. It does not include Addendum W which is the bolt-on addendum for an off-
system project delivering to PacifiCorp. I will send that separately. Per our last communication (attached), we
indicated PacifiCorp does not have sufficient transmission at Borah or Brady to accept any project greater than
23MW and you selected one project, XRG-DP 10, that would be developed into a PP A. Please provide
redline to this document with your proposed changes for discussion. If you or your team, have questions on the
PP A, please call.
Bruce Griswold
PacifiCorp C&T
503-813-5218 Office
503-702-1445 Cell
503-813-6260 Fax
From: James T. Carkulis (mailto:mtli(Ci)in-tch.com
Sent: Monday, May 11, 2009 5:35 AM
To: Griswold, Bruce \Mkt Function!
Subject: contracts
Bruce:
In January, PacifiCorp agreed the strategy with XRG was to have all 6 contract requests before the IPUC by the end of
April. To date, not one draft has been tendered by PacifiCorp. We realize these are exciting times and all are very busy,
but all the Aurora work should have been accomplished on JR1 and Jack Ranch by now, the 4 drafts on XRG-DP 7 thru
10 should be in our hands for review.
We would appreciate if we could receive these contracts for review and comment to move to execution.
Thank you.
Regards
James T. Carkulis
Confidential & Proprietary
Successfully Merging Free Market Principles with Societal Expectations
Exergy Development Group, LLC
(p) 208.336.9793
(I) 208.336.9431
(m) 406.459.3013
(e) mtlilG1in-tch.com
This electronic or printed document contains information which (a) may be LEGALLY PRIVILEGED, PROPRIETARY IN NATURE, OR OTHERWISE PROTECTED
BY LAW FROM DISCLOSU RE, and (b) is intended only for the use of the Addressee(s) named above. If the reader of this message is not the intended recipient
or the employee or agent responsible to deliver it to the intended recipient , you are hereby notified that any dissemination , distribution or copying of this
communication is strictly prohibited. If you have received this communication in error, please immediately notify us by telephone, and return the original message
to us at the above address via first class, express mail. Thank you
DRAFT
Tills WORKING DRAFT DOES NOT CONSTITUTE A BINDING OFFER, SHALL NOT FORM THE
BASIS FOR AN AGREEMENT BY ESTOPPEL OR OTHERWISE, AND IS CONDITIONED UPON EACH
PARTY'S RECEIPT OF ALL REQUIRED MANAGEMENT APPROVALS (INCLUDING FINAL CREDIT
AND LEGAL APPROVAL) AND ALL REGULATORY APPROVALS. ANY ACTIONS TAKEN BY A
PARTY IN RELIANCE ON THE TERMS SET FORTH IN THIS WORKING DRAFT OR ON STATEMENTS
MADE DURING NEGOTIATIONS PURSUANT TO TillS WORKING DRAFT SHALL BE AT THAT
PARTY'S OWN RISK. UNTIL TillS AGREEMENT IS NEGOTIATED, APPROVED BY MANAGEMENT
SIGNED, DELIVERED AND APPROVED BY ALL REQUIRED REGULATORY BODIES, NO PARTY
SHALL HAVE ANY OTHER LEGAL OBLIGATIONS, EXPRESSED OR IMPLIED, OR ARISING IN ANY
OTHER MANNER UNDER TIllS WORKING DRAFT OR IN THE COURSE OF NEGOTIATIONS.
POWER PURCHASE AGREEMENT
BETWEEN
(a non-fueled, Intermittent Resource with Mechanical Availability Guarantee, Idaho
Qualifying Facility-l OaMW /Month or less
AND
P ACIFICORP
Section 1: Definitions......................................................................................................
Section 2: Term, Commercial Operation Date .................................................................
Section 3: Representations and Warranties ....................................................................
Section 4: Delivery of Power; Availability Guaranty ..................................................... 12
Section 5: Purchase Prices.............................................................................................
Section 6: Operation and Control ..................................................................................
Section 7: Motive Force ................................................................................................
Section 8: Generation Forecasting Costs........................................................................
Section 9: Metering; Reports and Records.....................................................................
Section 10: Billings, Computations and Payments .........................................................
Section 11: Security ......................................................................................................
Section 12: Defaults and Remedies ...............................................................................
Section 13: Indemnification...........................................................................................
Section 14: Liability and Insurance ...............................................................................
Section 15: Force Majeure.............................................................................................
Section 16: Several Obligations.....................................................................................
Section 17: Choice of Law ............................................................................................
Section 18: Partial Invalidity .........................................................................................
Section 19: Waiver....................................................................................................... 32
Section 20: Governmental Jurisdiction and Authorizations............................................
Section 21: Successors and Assigns...............................................................................
Section 22: Entire Agreement........................................................................................
Section 23: Notices .......................................................................................................
DRAFT
POWER PURCHASE AGREEMENT
THIS POWER PURCHASE AGREEMENT, entered into this day of , 20is between (Seller s name J, an (Seller
state of incorporation J (corporation, partnership, or limited liability company
(the "Seller ) and PacifiCorp, an Oregon corporation acting in its merchant function capacity
PacifiCorp
).
Seller and PacifiCorp are referred to collectively as the "Parties" and
individually as a "Party
RECITALS
Seller intends to construct, own, operate and maintain a
(state type of facility J facility for the generation ofelectric power located in (City, CountyJ with an expected
Facility Capacity Rating of -kilowatts (kW) ("FacilityB. Seller intends to operate the Facility as a Qualifying Facility; as such term is
defined in Section 1.50 below.C. Seller estimates that the average annual Net Output to be delivered by the Facility
to PacifiCorp is kilowatt-hours (kWh) ("Average Annual Net Output") pursuant
to the monthly Energy Delivery Schedule in Exhibit D hereto, which amount of energy
PacifiCorp will include in its resource planning.D. PacifiCorp intends to designate Seller s Facility as a Network Resource for the
purposes of serving Network Load.E. This Agreement is a "New QF Contract" under the PacifiCorp Inter-Jurisdictional
Cost Allocation Revised Protocol and, as such, the costs of QF energy under this Agreement
shall be allocated as a system resource unless any portion of those costs exceeds the cost
PacifiCorp would have otherwise incurred acquiring comparable resources. In that event, the
Revised Protocol assigns those excess costs on a situs basis to the state in which the Facility is
located. In addition, for the purposes of inter-jurisdictional cost allocation, PacifiCorp represents
that the costs of this Agreement do not exceed the costs PacifiCorp would have otherwise
incurred acquiring resources in the market that are defined as "Comparable Resources" in
Appendix A to the Inter-Jurisdictional Cost Allocation Revised Protocol. For the purposes of
inter-jurisdictional cost allocation, PacifiCorp represents that the costs and revenues from the
energy and capacity sold to Seller by PacifiCorp will be assigned on a situs basis to the state to
which Net Output from the Facility is delivered.F. Seller (J has (J has not authorized Transmission Provider to release generation
data to PacifiCorp. If yes, the authorization is attached as Exhibit H.
NOW, THEREFORE, the Parties mutually agree as follows:
SECTION 1: DEFINITIONS
When used in this Agreement, the following terms shall have the following meanings:
DRAFT
1.1 "As-built Supplement" shall be a supplement to Exhibit A, provided by Seller
following completion of construction of the Facility, accurately describing the completed
Facility.
1.2 "Availability" means , for any Billing Period , the ratio, expressed as a
percentage , of (x) the aggregate sum of the turbine-minutes in which each of the Wind
Turbines at the Facility was available to generate at the Maximum Facility Delivery Rate
during the Billing Period over (y) the product of the number of Wind Turbines that comprise
the Facility Capacity Rating as of Commercial Operation multiplied by the number of minutes
in such Contract Year. A Wind Turbine shall be deemed not available to operate during
minutes in which it is (a) in an emergency, stop, service mode or pause state; (b) in "run
status and faulted; or (c) otherwise not operational or capable of delivering at the Maximum
Facility Delivery Rate to the Point of Delivery; unless if unavailable due solely to (i) a default
by PacifiCorp; (ii) a curtailment in accordance with Section 6.1 or Section 6.2(b) or (d); or
(iii) insufficient wind (including the normal amount of time required by the generating
equipment to resume operations following a period when wind speed is below the Cut-In Wind
Speed).
1.3 "Billing Period" means the time period between PacifiCorp s reading of its
power purchase meter at the Facility and for this Agreement shall coincide with calendar
months.
4 "Commercial Operation" means that not less than the 90 % of the expected
Facility Capacity Rating is fully operational and reliable and the Facility is fully
interconnected, fully integrated, and synchronized with the System , all of which shall be
Seller s responsibility to receive or obtain, and which occurs when all of the following events
(i) have occurred, and (ii) remain simultaneously true and accurate as of the date and moment
on which Seller gives PacifiCorp notice that Commercial Operation has occurred:
1.4.PacifiCorp has received a certificate addressed to PacifiCorp from
a Licensed Professional Engineer (a) stating the Facility Capacity Rating of the Facility
at the anticipated time of Commercial Operation and (b) stating that the Facility is able
to generate electric power reliably in amounts required by this Agreement and in
accordance with all other terms and conditions of this Agreement.
1.4.2
with Exhibit E.
Start-Up Testing of the Facility has been completed in accordance
1.4.PacifiCorp has received a certificate (attached hereto as Exhibit I)
addressed to PacifiCorp from a Licensed Professional Engineer, an attorney in good
standing in Idaho , or a letter from Transmission Provider, stating that , in accordance
with the Generation Interconnection Agreement , all required interconnection facilities
have been constructed , all required interconnection tests have been completed and the
Facility is physically interconnected with the System in conformance with the
Generation Interconnection Agreement and able to deliver energy consistent with the
DRAFT
terms of this Agreement, and the Facility is fully integrated and synchronized with the
System.
1.4.4 PacifiCorp has received a certificate addressed to PacifiCorp from
a Licensed Professional Engineer, or an attorney in good standing in Idaho, stating that
Seller has obtained all Required Facility Documents and, if requested by PacifiCorp in
writing, Seller shall have provided copies of any or all such requested Required Facility
Documents.
1.4.5 Seller has complied with the security requirements of Section 11.
Seller shall provide written notice to PacifiCorp stating when Seller believes that the Facility has
achieved Commercial Operation and its Facility Capacity Rating accompanied by the certificates
described above. PacifiCorp shall have ten days after receipt either to confirm to Seller that all
of the conditions to Commercial Operation have been satisfied or have occurred, or to state with
specificity what PacifiCorp reasonably believes has not been satisfied. If, within such ten day
period, PacifiCorp does not respond or notifies Seller confirming that the Facility has achieved
Commercial Operation, the original date of receipt of Seller s notice shall be the Commercial
Operation Date. IfPacifiCorp notifies Seller within such ten day period that PacifiCorp believes
the Facility has not achieved Commercial Operation, Seller must address the concerns stated in
PacifiCorp s notice to the mutual satisfaction of both Parties, and Commercial Operation shall
occur on the date of such satisfaction, as specified in a notice from PacifiCorp to Seller. If
Commercial Operation is achieved at less than one hundred percent (100%) of the expected
Facility Capacity Rating, Seller shall provide PacifiCorp an expected date for achieving the
expected Facility Capacity Rating, and the Facility Capacity Rating on that date shall be the final
Facility Capacity Rating under this Agreement. In no event will delay in achieving the expected
Facility Capacity Rating beyond the Commercial Operation Date postpone the Expiration Date
specified in Section 2.
1.5 "Commercial Operation Date" means the date the Facility first achieves
Commercial Operation.
1.6 Commission" means the Idaho Public Utilities Commission.
1.7 "Conforming Energy" means all Net Energy except Non-Conforming Energy
and Inadvertent Energy.
1.8 "Conforming Energy Purchase Price means the applicable price for
Conforming Energy and capacity, specified in Section 5.
1.9 "Contract Year" means a twelve (12) month period commencing at 00:00 hours
Mountain Prevailing Time ("MPT") on January 1 and ending on 24:00 hours MPT on
December 31; provided, however that the first Contract Year shall commence on the
Commercial Operation Date and end on the next succeeding December 31 , and the last
Contract Year shall end on the Expiration Date, unless earlier terminated as provided herein.
DRAFT
1.10 "Curtailment Energy" shall have the meaning set forth in Section 6.1 of this
Agreement.
11 "Cut-in Wind Speed" means the wind speed at which a stationary wind turbine
begins producing Net Energy, as specified by the turbine manufacturer and set forth in Exhibit
1.12 "Delay Liquidated Damages
, "
Delay Period"
, "
Delay Price" and "Delay
Volume shall have the meanings set forth in Section 2.3 of this Agreement. "Delay
Security" shall have the meaning set forth in Section 11.1.1 of this Agreement.
1.13
Agreement.
Default Security shall have the meaning set forth in Section 11.2 of this
1.14 "Effective Date shall have the meanIng set forth in Section 2.1 of this
Agreement.
1.15 "Energy Delivery Schedule" shall have the meaning set forth in Section 4.3 of
this Agreement.
1.16 "Environmental Attributes" means any and all claims , credits, benefits
emissions reductions, offsets, and allowances, howsoever entitled , resulting from the avoidance
of the emission of any gas , chemical , or other substance to the air, soil or water, which are
deemed of value by PacifiCorp. Environmental Attributes include but are not limited to: (1)
any avoided emissions of pollutants to the air, soil , or water such as (subject to the foregoing)
sulfur oxides (SOx), nitrogen oxides (NOx), carbon monoxide (CO), and other pollutants; and
(2) any avoided emissions of carbon dioxide (CO2), methane (CH4), and other greenhouse
gases (GHGs) that have been determined by the United Nations Intergovernmental Panel on
Climate Change to contribute to the actual or potential threat of altering the Earth's climate by
trapping heat in the atmosphere. Environmental Attributes do not include (i) Production Tax
Credits or certain other tax incentives existing now or in the future associated with the
construction, ownership or operation of the Facility, (ii) matters designated by PacifiCorp as
sources of liability, or (iii) adverse wildlife or environmental impacts.
1.17 "Expiration Date shall have the meaning set forth in Section 2.1 of this
Agreement.
1.18 "Facility means Seller s project including the Seller Interconnection
Facilities, as described in the Recitals, Exhibit A, and Exhibit B.
1.19 "Facility Capacity Rating " means the sum of the Nameplate Capacity Ratings
for all generators comprising the Facility.
1.20 "Force Majeure " has the meaning set forth in Section 15.
DRAFT
1.21 "Forced Outage" means an outage that requires removal of one or more Wind
Turbines from service, another outage state or a reserve shutdown state before the end of the
next weekend. Maintenance Outages and Planned Outages are not Forced Outages.
1.22 "Generation Interconnection Agreement" means the generation interconnection
agreement to be entered into separately between Seller and Transmission Provider , as
applicable , specifying the Point of Delivery and providing for the construction and operation of
the Interconnection Facilities.
1.23 "Inadvertent Energy " means: (1) energy delivered to the Point of Delivery in
excess of the Maximum Monthly Purchase Obligation; and (2) energy delivered to the Point of
Delivery at a rate exceeding the Maximum Facility Delivery Rate on an hour-averaged basis.
1.24 "Index Price " shall mean the average of: (1) the weighted average of the daily
On-Peak and Off-Peak Dow Jones Mid-Columbia index prices for firm energy; and (2) the
weighted average of the daily On-Peak and Off-Peak Dow Jones Palo Verde index (Dow Jones
Palo Verde Index) prices for firm energy. For Sunday and NERC holidays, the 24-Hour Index
Price shall be used , unless Dow Jones shall publish a Firm On-Peak and Firm Off-Peak Price
for such days for Mid-C and Palo Verde , in which event such indices shall be utilized for such
days. If the Dow Jones index or any replacement of that index ceases to be published during
the term of this Agreement, PacifiCorp shall select as a replacement a substantially equivalent
index that, after any appropriate or necessary adjustments, provides the most reasonable
substitute for the index in question. PacifiCorp s selection shall be subject to Seller s consent
which Seller shall not unreasonably withhold, condition or delay.
1.25 "Initial Year Energy Delivery Schedule " shall have the meaning set forth in
Section 4.
1.26 "Interconnection Facilities " means all the facilities and ancillary equipment
used to interconnect the Facility to the System, as defined in the Generation Interconnection
Agreement.
1.27 "Licensed Professional Engineer" means a person acceptable to PacifiCorp in
its reasonable judgment who is licensed to practice engineering in the state of Idaho , who has
training and experience in the engineering discipline(s) relevant to the matters with respect to
which such person is called to provide a certification, evaluation and/or opinion, who has no
economic relationship, association, or nexus with the Seller, and who is not a representative of
a consulting engineer, contractor , designer or other individual involved in the development of
the Facility, or of a manufacturer or supplier of any equipment installed in the Facility. Such
Licensed Professional Engineer shall be licensed in an appropriate engineering discipline for
the required certification being made. The engagement and payment of a Licensed
Professional Engineer solely to provide the certifications, evaluations and opinions required by
this Agreement shall not constitute a prohibited economic relationship, association or nexus
with the Seller, so long as such engineer has no other economic relationship, association or
nexus with the Seller.
DRAFT
1.28 "Maintenance Outage " means any outage of one or more Wind Turbines that is
not a Forced Outage or a Planned Outage. A Maintenance Outage is an outage that can be
deferred until after the end of the next weekend, but that requires that the Wind Turbine(s) be
removed from service before the next Planned Outage. A Maintenance Outage may occur any
time during the year and must have a flexible start date.
1.29 "Material Adverse Change shall mean, with respect to the Seller, if the
Seller, in the reasonable opinion of PacifiCorp, has experienced a material adverse change in
ability to fulfill its obligations under this Agreement.
1.30 "Maximum Facility Delivery Rate" means the maximum instantaneous rate
(kW) at which the Facility is capable of delivering Net Output at the Point of Delivery, as
specified in Exhibit A, and in compliance with the Generation Interconnection Agreement.
31 "Maximum Monthly Purchase Obligation" means the maximum amount of
energy PacifiCorp is obligated to purchase under this Agreement in a calendar month. In
accordance with Commission Order No. 29632, the Maximum Monthly Purchase Obligation
for a given month, in kWh , shall equal 10 000 kW multiplied by the total number of hours in
that month and prorated for any partial month.
32 "Nameplate Capacity Rating " means the maximum instantaneous generating
capacity of any qualifying small power or cogeneration generating unit supplying all or part of
the energy sold by the Facility, expressed in MW or kW, when operated consistent with the
manufacturer s recommended power factor and operating parameters, as set forth in a notice
from Seller to PacifiCorp delivered before the Commercial Operation Date and, if applicable
updated in the As-built Supplement.
1.33 NERC" means the North American Electric Reliability Corporation.
34 "Net Energy" means the energy component , in kWh, of Net Output.
1.35 "Net Output" means all energy and capacity produced by the Facility, less
station use and less transformation and transmission losses and other adjustments, if any. For
purposes of calculating payment under this Agreement, Net Output of energy shall be the
amount of energy flowing through the Point of Delivery, less any station use not provided by
the Facility. Net Output does not include Inadvertent Energy.
36 "Network Resource " shall have the meaning set forth in the Tariff.
1.37 "Network Service Provider" means PacifiCorp Transmission, as a provider of
network service to PacifiCorp under the Tariff.
1.38 "Non-Conforming Energy" means Net Output produced by the Facility prior to
the Commercial Operation Date.
DRAFT
39 "Non-Conforming Energy Purchase Price " means the applicable price for
Non-Conforming Energy and capacity, specified in Section 5.
1.40 Off-Peak Hours" means all hours of the week that are not On-Peak Hours.
1.41 "On-Peak Hours" means hours from 7:00 a.m. to 11:00 p.m. Mountain
Prevailing Time, Monday through Saturday, excluding Western Electricity Coordinating
Council (WECC) and North American Electric Reliability Corporation (NERC) holidays.
1.42 "Output Shortfall" and "Output Shortfall Damages " shall have the meanings
set forth in Section 4.5 of this Agreement.
1.43 "PacifiCorp " is defined in the first paragraph of this Agreement, and excludes
PacifiCorp Transmission.
1.44 "PacifiCorp Transmission" means PacifiCorp, an Oregon corporation, acting in
its interconnection and transmission function capacity.
1.45 "Planned Outage " means an outage of predetermined duration that is scheduled
in Seller s Energy Delivery Schedule. Boiler overhauls, turbine overhauls or inspections are
typical planned outages. Maintenance Outages and Forced Outages are not Planned Outages.
1.46 "Point of Delivery" means the high side of the generation step-up transformer(s)
located at the point of interconnection between the Facility and the System , as specified in the
Generation Interconnection Agreement and in Exhibit B.
1.47 "Prime Rate " means the rate per annum equal to the publicly announced prime
rate or reference rate for commercial loans to large businesses in effect from time to time
quoted by JPMorgan Chase & Co. If a JPMorgan Chase & Co. prime rate is not available, the
applicable Prime Rate shall be the announced prime rate or reference rate for commercial loans
in effect from time to time quoted by a bank with $10 billion or more in assets in New York
City, N. Y., selected by the Party to whom interest based on the prime rate is being paid.
48 "Production Tax Credits" means production tax credits under Section 45 of the
Internal Revenue Code as in effect from time to time during the term hereof or any successor
or other provision providing for a federal tax credit determined by reference to renewable
electric energy produced from wind resources and any correlative state tax credit determined
by reference to renewable electric energy produced from wind resources for which the Facility
is eligible.
1.49 "Prudent Electrical Practices " means any of the practices, methods and acts
engaged in or approved by a significant portion of the electrical utility industry or any of the
practices, methods or acts, which, in the exercise of reasonable judgment in the light of the
facts known at the time a decision is made, could have been expected to accomplish the desired
result at the lowest reasonable cost consistent with reliability, safety and expedition. Prudent
DRAFT
Electrical Practices is not intended to be limited to the optimum practice, method or act to the
exclusion of all others , but rather to be a spectrum of possible practices , methods or acts.
1.50 "QF" means "Qualifying Facility , as that term is defined in the version of
FERC Regulations (codified at 18 CFR Part 292) in effect on the date of this Agreement.
1.51 "Required Facility Documents" means all deeds, titles, leases, licenses
permits, authorizations , and agreements demonstrating that seller controls the necessary
property rights and government authorizations to construct, operate , and maintain the Facility,
including without limitation those set forth in Exhibit C.
1.52 "Scheduled Commercial Operation Date " means the date by which Seller
promises to achieve Commercial Operation, as specified in Section 2.
1.53 "Scheduled Monthly Energy Delivery" means the Net Energy scheduled to be
delivered during a given calendar month, as specified by Seller in the Energy Delivery
Schedule.
1.54 "Seller s Forecast-Cost Share " and "Seller s Capped Forecast-Cost Share
shall have the meanings set forth in Sections 8.2 and 8.3 respectively.
1.55 "Subsequent Energy Delivery Schedule " shall have the meaning set forth in
Section 4.
1.56 "System" means the electric transmission substation and transmission or
distribution facilities owned, operated or maintained by Transmission Provider, which shall
include, after construction and installation of the Facility, the circuit reinforcements
extensions, and associated terminal facility reinforcements or additions required to interconnect
the Facility, all as set forth in the Generation Interconnection Agreement.
1.57 "Tariff" means the PacifiCorp Transmission FERC Electric Tariff Seventh
Revised Volume No.11 Pro Forma Open Access Transmission Tariff or the Transmission
Provider s corresponding FERC tariff or both, as revised from time to time.
1.58 "Transmission Provider" means PacifiCorp Transmission or a successor
including any regional transmission organization ("RTO"
1.59 "Wind Turbine" means a (description of intended wind turbine model). At its
full Facility Capacity Rating, the Facility will consist of Wind Turbines.
SECTION 2: TERM. COMMERCIAL OPERATION DATE
This Agreement shall become effective after execution by both Parties and after
approval by the Commission ("Effective Date
);
provided however, this Agreement shall not
become effective until the Commission has determined that the prices to be paid for energy and
capacity are just and reasonable, in the public interest, and that the costs incurred by
DRAFT
PacifiCorp for purchases of capacity and energy from Seller are legitimate expenses , all of
which the Commission will allow PacifiCorp to recover in rates in Idaho in the event other
jurisdictions deny recovery of their proportionate share of said expenses.
Unless earlier terminated as provided herein, the Agreement shall remain in effect until
(enter date that is no later than 20 years after the Scheduled Commercial
Operation Date J ("Expiration Date
2.2 Time is of the essence of this Agreement, and Seller s ability to meet certain
requirements prior to the Commercial Operation Date and to achieve Commercial Operation by
the Scheduled Commercial Operation Date is critically important. Therefore
2.2.By Seller shall obtain and provide to
PacifiCorp copies of all governmental permits and authorizations necessary for
construction of the Facility.
2.2.2 By , Seller shall provide to PacifiCorp a copy
of an executed Generation Interconnection Agreement, whose terms shall be consistent
with the terms of this Agreement.
2.2.By the date 5 business days after the Effective Date , Seller shall
provide Delay Security required under Section 11., as applicable.
2.2.4 By the date 30 calendar days after the Effective Date, Seller shall
provide Default Security required under Section 11., as applicable.
2.2.Prior to Commercial Operation Date Seller shall provide
PacifiCorp with an As-built Supplement acceptable to PacifiCorp.
2.2.By , Seller shall have achieved Commercial
Operation ("Scheduled Commercial Operation Date
2.2.Beginning , Seller shall provide PacifiCorp a
one-page monthly update bye-mail on the progress of the milestones in this Section
Seller shall cause the Facility to achieve Commercial Operation on or before the
Scheduled Commercial Operation Date. If Commercial Operation occurs after the Scheduled
Commercial Operation Date, Seller shall be liable to pay PacifiCorp delay damages for the
number of days ("Delay Period") the Commercial Operation Date occurs after the Scheduled
Commercial Operation Date , up to a total of 120 days ("Delay Liquidated Damages
Delay Liquidated Damages equals the sum of: the Delay Price times the Delay Volume
for each day of the Delay Period
Where:
DRAFT
Delay Price" equals the positive difference, if any, of the Index Price minus the
weighted average of the On-Peak and Off-Peak monthly Conforming Energy Purchase
Prices; and
Delay Volume" equals the applicable Scheduled Monthly Energy Delivery divided by
the number of days in that month.
The Parties agree that the damages PacifiCorp would incur due to delay in the Facility
achieving Commercial Operation on or before the Scheduled Commercial Operation Date
would be difficult or impossible to predict with certainty, and that the Delay Liquidated
Damages are an appropriate approximation of such damages.
SECTION 3: REPRESENTATIONS AND WARRANTIES
PacifiCorp represents, covenants , and warrants to Seller that:
PacifiCorp is duly organized and validly existing under the laws of
the State of Oregon.
1.2 PacifiCorp has the requisite corporate power and authority to enter
into this Agreement and to perform according to the terms of this Agreement.
1.3 PacifiCorp has taken all corporate actions required to be taken by it
to authorize the execution, delivery and performance of this Agreement and the
consummation of the transactions contemplated hereby.
1.4 Subject to Commission approval , the execution and delivery of this
Agreement does not contravene any provision of, or constitute a default under , any
indenture, mortgage, or other material agreement binding on PacifiCorp or any valid
order of any court , or any regulatory agency or other body having authority to which
PacifiCorp is subject.
1.5 Subject to Commission approval, this Agreement is a valid and
legally binding obligation of PacifiCorp, enforceable against PacifiCorp in accordance
with its terms (except as the enforceability of this Agreement may be limited by
bankruptcy, insolvency, bank moratorium or similar laws affecting creditors ' rights
generally and laws restricting the availability of equitable remedies and except as the
enforceability of this Agreement may be subject to general principles of equity, whether
or not such enforceability is considered in a proceeding at equity or in law).
3.2 Seller represents , covenants, and warrants to PacifiCorp that:
3.2.Seller is a _(corporation , partnership, or limited liability
companyJ duly organized and validly existing under the laws of (state
of Seller s incorporationJ.
DRAFT
3.2.2 Seller has the requisite power and authority to enter into this
Agreement and to perform according to the terms hereof, including all required
regulatory authority to make wholesale sales from the Facility.
3.2.3 Seller s shareholders, directors, and officers have taken all actions
required to authorize the execution, delivery and performance of this Agreement and
the consummation of the transactions contemplated hereby.
3.2.4 The execution and delivery of this Agreement does not contravene
any provIsIon of, or constitute a default under, any indenture , mortgage , or other
material agreement binding on Seller or any valid order of any court, or any regulatory
agency or other body having authority to which Seller is subject.
3.2.This Agreement is a valid and legally binding obligation of Seller
enforceable against Seller in accordance with its terms (except as the enforceability of
this Agreement may be limited by bankruptcy, insolvency, bank moratorium or similar
laws affecting creditors' rights generally and laws restricting the availability of
equitable remedies and except as the enforceability of this Agreement may be subject to
general principles of equity, whether or not such enforceability is considered in a
proceeding at equity or in law).
3.2.The Facility is and shall for the term of this Agreement continue to
be a QF. Seller has provided the appropriate QF certification, which may include a
Federal Energy Regulatory Commission self-certification to PacifiCorp prior to
PacifiCorp s execution of this Agreement. At any time PacifiCorp has reason to
believe during the term of this Agreement that Seller s status as a QF is in question
PacifiCorp may require Seller to provide PacifiCorp with a written legal opinion from
an attorney in good standing in the state of Idaho and who has no economic
relationship, association or nexus with the Seller or the Facility, stating that the Facility
is a QF and providing sufficient proof (including copies of all documents and data as
PacifiCorp may request) demonstrating that Seller has maintained and will continue to
maintain the Facility as a QF.
3.2.Neither the Seller nor any of its principal equity owners is or has
within the past two (2) years been the debtor in any bankruptcy proceeding, is unable to
pay its bills in the ordinary course of its business, or is the subject of any legal or
regulatory action, the result of which could reasonably be expected to impair Seller
ability to own and operate the Facility in accordance with the terms of this Agreement.
DRAFT
3.2.Seller has not at any time defaulted in any of its payment
obligations for electricity purchased from PacifiCorp.
3.2.Seller is not in default under any of its other agreements and is
current on all of its financial obligations.
3.2.10 Seller owns, and will continue to own for the term of this
Agreement, all right, title and interest in and to the Facility, free and clear of all liens
and encumbrances other than liens and encumbrances related to third-party financing of
the Facility.
Notice If at any time during this Agreement , any Party obtains actual
knowledge of any event or information which would have caused any of the representations
and warranties in this Section 3 to have been materially untrue or misleading when made, such
Party shall provide the other Party with written notice of the event or information, the
representations and warranties affected, and the action, if any, which such Party intends to take
to make the representations and warranties true and correct. The notice required pursuant to
this Section shall be given as soon as practicable after the occurrence of each such event.
SECTION 4: DELIVERY OF POWER: AVAILABILITY GUARANTY
Delivery and Acceptance of Net Output.Unless otherwise provided herein
PacifiCorp will purchase and Seller will sell all Net Output from the Facility.
4.2 No Sales to Third Parties . During the term of this Agreement, Seller shall not
sell any Net Output from the Facility to any entity other than PacifiCorp.
Energy Delivery Schedule . Seller shall prepare and provide to PacifiCorp, on an
ongoing basis , a written schedule of Net Energy expected to be delivered by the Facility
Energy Delivery Schedule ), in accordance with the following:
During the first twelve full calendar months following the
Commercial Operation Date, Seller predicts that the Facility will produce and deliver
the following monthly amounts ("Initial Year Energy Delivery Schedule
Month
January
Enen!v Delivery (kWh)
February
March
April
May
June
DRAFT
July
August
September
October
November
December
3.2 Seller may revise the Initial Year Energy Delivery Schedule any
time prior to the Commercial Operation Date.
Beginning at the end of the ninth full calendar month of operation
and at the end of every 3rd month thereafter, Seller shall supplement the Energy
Delivery Schedule with three additional months of forward estimates (which shall be
appended to this Agreement as Exhibit D) ("Subsequent Energy Delivery Schedule
such that the Energy Delivery Schedule will provide at least three months of scheduled
energy estimates at all times. Seller shall provide Subsequent Energy Delivery
Schedules no later than 5:00 pm of the 5th day after the due date. If Seller does not
provide a Subsequent Energy Delivery Schedule by the above deadline, scheduled
energy for the omitted period shall equal the amounts scheduled by Seller for the same
three-month period during the previous year.
3.4 Beginning with the end of the third month after the Commercial
Operation Date and at the end of every third month thereafter the Seller may not revise
the immediate next three months of previously provided Energy Delivery Schedules.
But by written notice given to PacifiCorp no later than 5:00 PM of the 5th day after the
end of any such third month, the Seller may revise all other previously provided Energy
Delivery Schedules. Failure to provide timely written notice of changed amounts will
be deemed to be an election of no change.
4.4 Minimum Availability Obligation Seller shall cause the Facility to achieve an
Availability of at least 85 % during each month ("Guaranteed Availability
Liquidated Damages for Output Shortfall . If the Availability in any given month
falls below the Guaranteed Availability, the resulting shortfall shall be expressed in kWh as the
Output Shortfall." The Output Shortfall shall be calculated in accordance with the following
formula:
Output Shortfall = (Guaranteed Availability - Availability) *
Scheduled Monthly Energy Delivery
Seller shall pay PacifiCorp for any Output Shortfall at the lower of (1) the positive difference
if any, of the Index Price minus the weighted average of the On-Peak and Off-Peak monthly
DRAFT
Conforming Energy Purchase Prices; or (2) the weighted average of the On-Peak and Off-Peak
monthly Conforming Energy Purchase Prices ("Output Shortfall Damages
Output Shortfall Damages =Output Shortfall * Output Shortfall Price
Where:
Output Shortfall Price =(Index Price - Weighted Average CEPP), except
that if Output Shortfall Price .( 0 , then Output
Shortfall Price = 0
Weighted Average CEPP = the weighted average On-Peak and Off-Peak
Conforming Energy Purchase Prices for the month
of Output Shortfall
If an Output Shortfall occurs in any given month, Seller may owe PacifiCorp liquidated
damages. Each Party agrees and acknowledges that (a) the damages that PacifiCorp would
incur due to the Facility s failure to achieve the Guaranteed Availability would be difficult or
impossible to predict with certainty, and (b) the liquidated damages contemplated in this
Section 4.5 are a fair and reasonable calculation of such damages.
Audit Rights In addition to data provided under Sections 9.2 and 9.
PacifiCorp shall have the right , but not the obligation, to audit the Facility s compliance with
its Guaranteed Availability using any reasonable methods. Seller agrees to retain all
performance related data for the Facility for a minimum of three years, and to cooperate with
PacifiCorp in the event PacifiCorp decides to audit such data.
SECTION 5: PURCHASE PRICES
Energy Purchase Price . Except as provided in Section 5., PacifiCorp will pay
Seller Conforming Energy or Non-Conforming Energy Purchase Prices for Net Output
adjusted for the month and On-Peak Hours or Off-Peak Hours and the wind integration cost
using the following formulae, in accordance with Commission Order Nos. 30423 , 30497, and
30744:
Conforming Energy Purchase Price = (ARce * MPM) - WIC
Non-Conforming Energy Purchase Price = (ARnce * MPM) - WIC
Where:
ARce Conforming Energy annual rate from Table 1, below, for the year
of the Net Output.
the lower of
85% of the Conforming Energy annual rate from Table 1
below, for the year of Net Output
ARnce
DRAFT
MPM
85% of weighted average of the daily On-Peak and Off-
Peak Dow Jones Mid-Columbia index prices for firm
energy for the month, or portion of month, of Net Output.
monthly On-Peak or Off-Peak multiplier from Table 2, below, that
corresponds to the month of the Net Output and whether the Net
Output occurred during On-Peak Hours or Off-Peak Hours.
$5.l0/MWh, the wind integration cost prescribed in Commission
Order No. 30497.
WIC
Example calculations are provided in Exhibit G.
Table 1: Conforming Energy Annual Rates (from Commission Order No. 30744)*
Conforming Energy
Annual Rate (ARce
Year $/MWh
2009 76.
2010 75.
2011 77.
2012 80.24
2013 82.
2014 84.
2015 86.
2016 88.25
2017 90.
2018 92.
2019 94.
2020 97.
2021 99.
2022 101. 73
2023 104.
2024 106.
2025 109.
2026 112.
2027 115.
2028 118.
2029 122.20
2030 125.
2031 128.
Table 2: Monthly On-PeakiOff-Peak Multipliers (from Commission Order No. 30423)
I Month On-Peak Off-Peak
* If Seller has elected levelized pricing for Net Output, additional security requirements in
Section 11.2 apply.
DRAFT
Hours Hours
January 103%94%
February 105%97%
March 95%80%
April 95%76%
May 92%63%
June 94%65%
July 121%92%
August 121%106%
September 109%99%
October 115%105%
November 110%96%
December 129%120%
5.2 Payment.
For each Billing Period in each Contract Year, PacifiCorp shall pay Seller as follows:
For delivery of Conforming Energy:
Payment (CEnergYon-Peak * CEPPriceon-Peak / 1000) +
(CEnergYOff-Peak * CEPPriceOff-Peak / 1000)
For delivery of Non-Conforming Energy:
(NCEnergYon-Peak * NCEPPriceon-Peak / 1000) +
(NCEnergYOff-Peak * NCEPPriceOff-Peak / 1000)
Payment
Where:
CEnergy
CEPPrice
NCEnergy
NCEPPrice
On-Peak
Off-Peak
Conforming Energy in kWh
Conforming Energy Purchase Price in $/MWh
Non-Conforming Energy in kWh
Non-Conforming Energy Purchase Price in $/MWh
the corresponding value for On-Peak Hours
the corresponding value for Off-Peak Hours
Inadvertent Energy PacifiCorp may accept Inadvertent Energy at its sole
discretion, but will not purchase or pay for Inadvertent Energy.
SECTION 6: OPERATION AND CONTROL
Seller shall operate and maintain the Facility in a safe manner in accordance with
the Generation Interconnection Agreement, Prudent Electrical Practices and in accordance with
the requirements of all applicable federal, state and local laws and the National Electric Safety
Code as such laws and code may be amended from time to time. PacifiCorp shall have no
obligation to purchase Net Output from the Facility to the extent the interconnection between
the Facility and PacifiCorp s electric system is disconnected, suspended or interrupted, in
DRAFT
whole or in part, pursuant to the Generation Interconnection Agreement , or to the extent
generation curtailment is required as a result of Seller s non-compliance with the Generation
Interconnection Agreement. PacifiCorp shall have the right to inspect the Facility to confirm
that Seller is operating the Facility in accordance with the provisions of this Section 6 upon
reasonable notice to Seller. Seller is solely responsible for the operation and maintenance of
the Facility. PacifiCorp shall not, by reason of its decision to inspect or not to inspect the
Facility, or by any action or inaction taken with respect to any such inspection , assume or be
held responsible for any liability or occurrence arising from the operation and maintenance by
Seller of the Facility.
6.2 Energy Acceptance.
6.2.Voluntary Curtailment by PacifiCorp. Seller shall curtail deliveries
of Net Output and associated Environmental Attributes at any time , in whole or in part
and for any duration specified by PacifiCorp with no less than ten (10) minutes (or such
lesser time as may be provided for, as between Transmission Provider and
Interconnection Provider, in the Generation Interconnection Agreement) prior notice
(which may be given by telephone) from PacifiCorp to Seller. PacifiCorp shall take
reasonable steps to confirm Seller s receipt of such notice. The MWh amount of Net
Output curtailed pursuant to this Section 6.1 ("Curtailment Energy ) shall be
reasonably determined by Seller after the fact based on the amount of energy that could
have been generated at the Facility and delivered to PacifiCorp as Net Output at the
Point of Delivery but that was not generated and delivered because of the curtailment.
Seller shall determine the quantity of Curtailment Energy based on (1) the time and
duration of the curtailment period and (2) the number of MWhs that would have been
generated based on the wind velocities recorded at the Facility during the period
curtailment and the tested and verified power curve for the Wind Turbines provided in
Exhibit A. Seller shall promptly provide PacifiCorp with access to such information
and data as PacifiCorp may reasonably require to confirm to its reasonable satisfaction
the amount of Curtailment Energy. PacifiCorp shall pay Seller for the Curtailment
Energy at the then applicable Conforming Energy Purchase Price. Notwithstanding any
other provision hereof, during any period of curtailment pursuant to this Section 6.
Seller shall not generate Net Output to the extent curtailed by PacifiCorp, or sell any
portion of the Facility s energy to any third party. Notwithstanding the foregoing,
PacifiCorp s obligation to pay for Curtailment Energy pursuant to this Section 6.
shall not apply during any times Seller would otherwise have been required to curtail
pursuant to Section 6.2 and during any times prior to the Commercial Operation
Date.
6.2.2 Required Curtailment.PacifiCorp shall not be obligated to
purchase, receive or pay for Net Output (nor shall it be liable for associated unrealized
Production Tax Credits or Environmental Attributes) that is not delivered to the Point
of Delivery during times and to the extent that such Net Output is not delivered to the
Point of Delivery because (a) the interconnection between the Facility and the System is
disconnected, suspended or interrupted, in whole or in part, pursuant to the terms of the
DRAFT
Generation Interconnection Agreement (b) the Network Service Provider or
Transmission Provider Curtails (as defined in the Tariff) Net Output or order
PacifiCorp to curtail Net Output, (c) the Facility s Output is not received because the
Facility is not fully integrated or synchronized with the System , or (d) an event of
Force Majeure prevents either Party from delivering or receiving Net Output. The
MWh amount of Net Output curtailed pursuant to this Section 6.2 shall be reasonably
determined by Seller after the fact based on the amount of energy that could have been
generated at the Facility and delivered to PacifiCorp as Net Output but that was not
generated and delivered because of the curtailment. Seller shall determine the quantity
of such curtailed energy based on (x) the time and duration of the curtailment period
and (y) wind conditions recorded at the Facility during the period of curtailment and the
tested and verified power curve for the Wind Turbines. Seller shall promptly provide
PacifiCorp with access to such information and data as PacifiCorp may reasonably
require to confirm to its reasonable satisfaction the amount of energy that was not
generated or delivered because of a curtailment described in this Section 6.
6.2.PacifiCorp as Merchant.Seller acknowledges that PacifiCorp,
acting in its merchant capacity function as purchaser under this Agreement, has no
responsibility for or control over PacifiCorp Transmission or any successor
Transmission Provider.
Outages
Planned Outages. Except as otherwise provided herein, Seller shall
not schedule Planned Outage during any portion of the months of ((list peak months)
November, December, January, February, June , July, and AugustJ, except to the extent
a Planned Outage is reasonably required to enable a vendor to satisfy a guarantee
requirement in a situation in which the vendor is not otherwise able to perform the
guarantee work at a time other than during one of the months specified above. Seller
shall, in Exhibit D provide PacifiCorp with an annual forecast of Planned Outages for
each Contract Year at least one (1) month , but no more that three (3) months, before
the first day of that Contract Year, and shall promptly update such schedule , or
otherwise change it only, to the extent that Seller is reasonably required to change it in
order to comply with Prudent Electrical Practices. Seller shall not schedule more than
one hundred fifty (150) hours of Planned Outages for each calendar year. Seller shall
not schedule any maintenance of Interconnection Facilities during such months, without
the prior written approval of PacifiCorp, which approval may be withheld by
PacifiCorp in its sole discretion.
3.2 Maintenance Outages If Seller reasonably determines that it is
necessary to schedule a Maintenance Outage , Seller shall notify PacifiCorp of the
proposed Maintenance Outage as soon as practicable but in any event at least five (5)
days before the outage begins (or such shorter period to which PacifiCorp may
reasonably consent in light of then existing wind conditions). Upon such notice, the
Parties shall plan the Maintenance Outage to mutually accommodate the reasonable
DRAFT
requirements of Seller and the service obligations of PacifiCorp. Seller shall take all
reasonable measures and use best efforts consistent with Prudent Electrical Practices to
not schedule any Maintenance Outage during the following periods: (June 15 through
June 30, July, August, and September 1 through September 15). Seller shall include in
such notice of a proposed Maintenance Outage the expected start date and time of the
outage , the amount of generation capacity of the Facility that will not be available, and
the expected completion date and time of the outage. Seller may provide notices under
this Section 6.2 orally. Seller shall confirm any such oral notification in writing as
soon as practicable. PacifiCorp shall promptly respond to such notice and may request
reasonable modifications in the schedule for the outage. Seller shall use all reasonable
efforts to comply with PacifiCorp s request to modify the schedule for a Maintenance
Outage if such modification has no substantial impact on Seller. Seller shall notify
PacifiCorp of any subsequent changes in generation capacity of the Facility during such
Maintenance Outage and any changes in the Maintenance Outage completion date and
time. Seller shall take all reasonable measures and exercise its best efforts consistent
with Prudent Electrical Practices to minimize the frequency and duration of
Maintenance Outages.
Forced Outages Seller shall promptly provide to PacifiCorp an
oral report, via telephone to a number specified by PacifiCorp, of any Forced Outage
of the Facility. Such report shall include the amount of generation capacity of the
Facility that will not be available because of the Forced Outage and the expected return
date and time of such generation capacity. Seller shall promptly update the report as
necessary to advise PacifiCorp of changed circumstances. If the Forced Outage
resulted in more than 15 % of the Facility Capacity Rating of the Facility being
unavailable , Seller shall confirm the oral report in writing as soon as practicable.
Seller shall take all reasonable measures and exercise its best efforts consistent with
Prudent Electrical Practices to avoid Forced Outages and to minimize their duration.
3.4 Notice of Deratings and Outages Without limiting other notice
requirements , Seller shall notify PacifiCorp, via telephone to a number specified by
PacifiCorp, of any limitation, restriction, derating or outage known to Seller that affects
the generation capacity of the Facility in an amount greater than five percent (5 %) of
the Facility Capacity Rating for the following day. Seller shall promptly update such
notice to reflect any material changes to the information in such notice.
Effect of Outages on Estimated Output.Seller shall factor Planned
Outages and Maintenance Outages that Seller reasonably expects to encounter in the
ordinary course of operating the Facility into the Scheduled Monthly Energy Delivery
amounts in the Energy Delivery Schedule set forth in Exhibit D.
6.4 Scheduling
6.4.Daily Scheduling . (provide if applicable)
DRAFT
6.4.2 Cooperation and Standards . With respect to any and all scheduling
requirements in this Agreement, (a) Seller shall cooperate with PacifiCorp with respect
to scheduling Net Output, and (b) each Party shall designate authorized representatives
to communicate with regard to scheduling and related matters arising hereunder.
6.4.Schedule Coordination. If, as a result of this Agreement
PacifiCorp is deemed by an RTO to be financially responsible for Seller s performance
under the Generation Interconnection Agreement due to Seller s lack of standing as a
scheduling coordinator" or other RTO recognized designation qualification or
otherwise , then (a) Seller shall acquire such RTO recognized standing (or shall contract
with a third party who has such RTO recognized standing) such that PacifiCorp is no
longer responsible for Seller s performance under the Generation Interconnection
Agreement, and (b) Seller shall defend , indemnify and hold PacifiCorp harmless against
any liability arising due to Seller s performance or failure to perform under the
Generation Interconnection Agreement or RTO requirement.
Delivery Exceeding the Maximum Facility Delivery Rate Seller shall not
deliver energy from the Facility to the Point of Delivery in an amount that exceeds the
Maximum Facility Delivery Rate. Seller s failure to limit such deliveries to the Maximum
Facility Delivery Rate shall be a material breach of this Agreement.
Increase to the Maximum Facility Delivery Rate. Seller may, in accordance with
this Section 6.6 and upon written approval by PacifiCorp, increase the Maximum Facility
Delivery Rate, unless, after such increase , under normal or average design conditions the Net
Output would exceed the Maximum Monthly Purchase Obligation in any given month.
PacifiCorp approval of such increase is conditioned on the Public Utility Regulatory Policies
Act (16 U.C. 824a-3) and other applicable law requiring PacifiCorp to purchase the
incremental Net Output. If Seller increases the Maximum Facility Delivery Rate, PacifiCorp
will continue to pay for base Net Output at the rate(s) prescribed by Section 5 of this
Agreement, and PacifiCorp will pay for incremental Net Output resulting from the increase to
the Maximum Facility Delivery Rate at the rate(s) prescribed by the Commission at the time of
PacifiCorp s approval , if granted, of the increase in the Maximum Facility Delivery Rate.
PacifiCorp shall , in its approval , if granted , specify a reasonable means of distinguishing such
base Net Output from such incremental Net Output.
SECTION 7: MOTIVE FORCE
Prior to the Effective Date of this Agreement, Seller provided to PacifiCorp a motive
force plan including an hourly wind profile acceptable to PacifiCorp in its reasonable discretion
and attached hereto as Exhibit F-together with a certification from a Licensed Professional
Engineer to PacifiCorp attached hereto as Exhibit F-certifying that the implementation of the
fuel or motive force plan can reasonably be expected to provide fuel or motive force to the
Facility for the duration of this Agreement adequate to generate power and energy in quantities
necessary to deliver the Average Annual Net Output.
DRAFT
SECTION 8: GENERATION FORECASTING COSTS
Forecast Service Election PacifiCorp may, in its discretion, add forecasting
services for Seller s Facility to PacifiCorp s existing contract with a qualified wind-energy-
production forecasting vendor, which contract and vendor may change during the term of this
Agreement.
8.2 Seller s Forecast-Cost Share. Pursuant to Commission Order No. 30497, Seller
shall be responsible for 50% of PacifiCorp s cost of adding such forecasting services ("Seller
Forecast-Cost Share ) up to Seller s Capped Forecast-Cost Share.
Cap on Seller s Forecast-Cost Share. Seller s Forecast-Cost Share for a given
Contract Year is capped at 0.1 % of total payments made by PacifiCorp to Seller for Net
Output during the previous Contract Year ("Seller s Capped Forecast-Cost Share ). If the
last Contract Year of this Agreement is shorter than a full calendar year, the cap will be
prorated for that shortened year. For the year(s) prior to the second Contract Year of this
agreement that equals a full calendar year, Seller s Forecast-Cost Share is capped at 0.1 % of
estimated payments for Net Output based on the Energy Delivery Schedule.
8.4 Payment.Seller shall pay to PacifiCorp Seller s Forecast-Cost Share uncapped
by Section 8.3 for each Contract Year in equal payments for each month of such year except
the last month of such year. (For example, in a Contract Year equaling a full calendar year
Seller would pay 1/11th of Seller s Forecast-Cost Share during each of the first 11 months.) In
the last month of each Contract Year, PacifiCorp shall refund to Seller the amount paid by
Seller under this Section in excess , if any, of Seller s Capped Forecast-Cost Share. For a
Contract Year encompassed by just one calendar month , Seller s payment to PacifiCorp and
PacifiCorp s refund to Seller shall be calculated and paid simultaneously. To the extent
practicable , payments and refunds under this Section shall be included in monthly payments
and invoices under Section 10.
SECTION 9: METERING: REPORTS AND RECORDS
Metering Equipment.PacifiCorp shall design, furnish, install, own, inspect
test, maintain and replace all metering equipment required pursuant to the Generation
Interconnection Agreement.
Location of Metering Equipment.Metering shall be performed at the
location and in the manner specified in Exhibit B and the Generation Interconnection
Agreement. All quantities of energy purchased hereunder shall be adjusted to account
for electrical losses, if any, between the point of metering and the Point of Delivery, so
that the purchased amount reflects the net amount of power flowing into PacifiCorp ' s
system at the Point of Delivery. The loss adjustment shall be a reduction of 2 % of the
kWh energy production recorded on the Facility output meter until actually measured
and calibrated at the meter by PacifiCorp.
DRAFT
1.2 Maintenance of Metering Equipment.PacifiCorp shall periodically
inspect , test, repair and replace the metering equipment as provided in the Generation
Interconnection Agreement or at the request of Seller if Seller has reason to believe
metering may be off and requests an inspection in writing. Seller shall bear the cost for
any Seller requests. If any of the inspections or tests disclose an error exceeding two
percent (2 %), either fast or slow, proper correction, based upon the inaccuracy found
shall be made of previous readings for the actual period during which the metering
equipment rendered inaccurate measurements if that period can be ascertained. If the
actual period cannot be ascertained, the proper correction shall be made to the
measurements taken during the time the metering equipment was in service since last
tested , but not exceeding three Billing Periods, in the amount the metering equipment
shall have been shown to be in error by such test. Any correction in billings or
payments resulting from a correction in the meter records shall be made in the next
monthly billing or payment rendered.
1.3 Costs of Metering Equipment.To the extent not otherwise provided in
the Generation Interconnection Agreement all PacifiCorp ' s costs relating to all
metering equipment installed to accommodate Seller s Facility shall be borne by Seller.
9.2 Telemetering. Seller shall provide telemetering equipment and facilities capable
of transmitting the following information concerning the Facility pursuant to the Generation
Interconnection Agreement and to PacifiCorp on a real-time basis, and will operate such
equipment when requested by PacifiCorp to indicate:
(a)
(b)
(c) the Facility s total instantaneous generation capacity.
Seller shall also transmit to PacifiCorp any other data from the Facility that Seller receives on a
real-time basis, including meteorological data, wind speed data, wind direction data and gross
output data. Seller shall provide such real-time data to PacifiCorp in the same detail that Seller
receives the data (e., if Seller receives the data in four second intervals, PacifiCorp shall also
receive the data in four second intervals). PacifiCorp shall have the right from time to time to
require Seller to provide additional telemetering equipment and facilities to the extent necessary
and reasonable.
instantaneous MW output at the Point of Delivery;
Net Output; and
Monthly Reports and Logs. Within thirty (30) days after the end of each Billing
Period , Seller shall provide to PacifiCorp the following:
Reports. A report in electronic format, which report shall include
(a) summaries of the Facility s wind and output data for the Billing Period in intervals
not to exceed one hour (or such shorter period as is reasonably possible with
commercially available technology), including information from the Facility s computer
monitoring system; (b) summaries of any other significant events related to the
construction or operation of the Facility for the Billing Period; (c) details of
Availability of the Facility for the Billing Period sufficient to calculate Availability and
DRAFT
including hourly average wind velocity measured at turbine hub height and ambient air
temperature; and (d) any supporting information that PacifiCorp may from time to time
reasonably request (including historical wind data for the Facility).
3.2 Electronic Fault Log Seller shall maintain an electronic fault log
of operations of the Facility during each hour of the term of this Agreement
commencing on the Commercial Operation Date. Seller shall provide PacifiCorp with
a copy of the electronic fault log within thirty (30) days after the end of the Billing
Period to which the fault log applies.
9.4 Cost of Performance Monitoring Seller shall pay for and design, furnish
install , own, inspect, test , maintain and replace all equipment required in order to record data
required for the reports and logs in Sections 9.
SECTION 10: BILLINGS. COMPUTATIONS AND PAYMENTS
10.Payment for Net Output.On or before the thirtieth (30th) day following the end
of each Billing Period , PacifiCorp shall send to Seller payment for Seller s deliveries of Net
Output to PacifiCorp, together with computations supporting such payment. PacifiCorp may
offset any such payment to reflect amounts owing from Seller to PacifiCorp pursuant to this
Agreement, the Generation Interconnection Agreement, and any other agreement(s) between
the Parties. Any such offsets shall be separately itemized on the statement accompanying each
payment to Seller.
10.2 Annual Invoicing for Output Shortfall Thirty calendar days after the end of
each Contract Year , PacifiCorp shall deliver to Seller an invoice showing PacifiCorp' s
computation of Output Shortfall , if any, for all Billing Periods in the prior Contract Year and
Output Shortfall Damages, if any. In preparing such invoices , PacifiCorp shall utilize the
meter data provided to PacifiCorp for the Contract Year in question, but may also rely on
historical averages and such other information as may be available to PacifiCorp at the time of
invoice preparation if the meter data for such Contract Year is then incomplete or otherwise
not available. To the extent required, PacifiCorp shall prepare any such invoice as promptly as
practicable following its receipt of actual results for the relevant Contract Year. Seller shall
pay to PacifiCorp, by wire transfer of immediately available funds to an account specified in
writing by PacifiCorp or by any other means agreed to by the Parties in writing from time to
time, the amount set forth as due in such invoice, and shall within thirty (30) days after
receiving the invoice raise any objections regarding any disputed portion of the invoice.
Objections not made by Seller within the thirty-day period shall be deemed waived.
10.3 Any amounts owing after the due date thereof shall bear interest at the Prime
Rate plus two percent (2 %) from the date due until paid; provided, however that the interest
rate shall at no time exceed the maximum rate allowed by applicable law.
10.4 Disputed Amounts If either Party, in good faith, disputes any amount due
pursuant to an invoice rendered hereunder, such Party shall notify the other Party of the
DRAFT
specific basis for the dispute and , if the invoice shows an amount due, shall pay that portion of
the statement that is undisputed , on or before the due date. Except with respect to invoices
provided under Section 10., any such notice shall be provided within two (2) years of the date
of the invoice in which the error first occurred. If any amount disputed by such Party is
determined to be due to the other Party, or if the Parties resolve the payment dispute , the
amount due shall be paid within five (5) days after such determination or resolution, along with
interest in accordance with Section 10.
SECTION 11: SECURITY
11.Delay Security
11.1.1 Duty to Post Security . Seller , within 5 business days after IPUC
approval of this Agreement , shall post a letter of credit in the amount of
Delay Security ). The letter of credit shall be an irrevocable standby letter of credit
from an institution that has a long-term senior unsecured debt rating of "A" or greater
from Standard & Poors or "A2" or greater from Moody , in a form reasonably
acceptable to PacifiCorp, naming PacifiCorp as the party entitled to demand payment
and present draw requests thereunder. To the extent PacifiCorp s draws on the letter of
credit cause the remaining balance of the letter of credit to drop below
Seller, within 15 calendar days, shall restore the letter of credit to no less than
11.1.2 Right to Draw on Security. PacifiCorp shall have the right to draw
on the Delay Security to collect Delay Liquidated Damages. Commencing on or about
first of each month, PacifiCorp will invoice Seller for Delay Liquidated Damages
incurred, if any, during the preceding month. If Seller fails to pay any undisputed
amount within 30 calendar days of the invoice date, PacifiCorp shall draw such amount
on the Delay Security. The Parties will make billings and payments for Delay
Liquidated Damages in accordance with Section 10.
11.1.3 Additional Security . In the event PacifiCorp reasonably determines
at any time that the remaining amount of Delay Security is less than the estimated value
of Delay Liquidated Damages (due to upward changes in market price and/or due to
Seller s inability to meet the Scheduled Commercial Operation Date), PacifiCorp may
demand that Seller post, and Seller will post within 5 business days of receipt of such
demand , additional Delay Security equal to the estimated (unpaid) Delay Liquidated
Damages.
11.1.4 Termination of Letter of Credit.Unless PacifiCorp disputes
whether Seller has paid all Delay Liquidated Damages, Seller may terminate the Delay
Security letter of credit on or after the 180th calendar day following commencement of
Commercial Operation by providing PacifiCorp with no less than thirty-day advance
written notice of its intent to do so.
DRAFT
11.1.5 Default. Seller s failure to post and maintain Delay Security in
accordance with Section 11.1 will constitute an event of default, unless cured in
accordance with Section 12.1 of this Agreement.
11.2 Default Security (Levelized Pricing Only)If Seller has adopted levelized
pricing for Net Output , Seller will provide security to PacifiCorp pursuant to Commission
Order Nos. 21690, 21800 , 29482 , 29587 and related orders ("Default Security ) as set forth
in Addendum _(add addendum if Seller elects levelized pricing).
SECTION 12: DEFAULTS AND REMEDIES
12.1 The following events shall constitute defaults under this Agreement:
12.1.1 Non-Payment.Seller s failure to make a payment when due under
this Agreement or post and maintain security in conformance with the requirements of
Section 11 or maintain insurance in conformance with the requirements of Section 14 of
this Agreement, if the failure is not cured within ten (10) business days after the non-
defaulting Party gives the defaulting Party a notice of the default.
12.1.2 Breach of Material Term . Breach by a Party of a representation or
warranty set forth in this Agreement, if such failure or breach is not cured within thirty
(30) days following written notice.
12.1.3 Default on Other Agreements. Seller s failure to cure any default
under any commercial or financing agreements or instrument (including the Generation
Interconnection Agreement) within the time allowed for a cure under such agreement or
instrument.
12.1.4 Insolvency. A Party (a) makes an assignment for the benefit of its
creditors; (b) files a petition or otherwise commences, authorizes or acquiesces in the
commencement of a proceeding or cause of action under any bankruptcy or similar law
for the protection of creditors , or has such a petition filed against it and such petition is
not withdrawn or dismissed within sixty (60) days after such filing; (c) becomes
insolvent; or (d) is unable to pay its debts when due.
12.1.5 Material Adverse Change. A Material Adverse Change has
occurred with respect to Seller and Seller fails to provide such performance assurances
as are reasonably requested by PacifiCorp, within fifteen (15) days from the date of
such request.
DRAFT
12.1.6 Sale to Third-Party . Seller s sale of Net Output to an entity other
than PacifiCorp, as prohibited by Section 4.
12.1.7 Non-Delivery Unless excused by an event of Force Majeure
Seller s failure to deliver any Net Energy for three consecutive calendar months.
12.1.8 Party otherwise fails to perform any material obligation
(including but not limited to failure by Seller to meet any deadline set forth in Section
2) imposed upon that Party by this Agreement if the failure is not cured within thirty
(30) days after the non-defaulting Party gives the defaulting Party notice of the default;
provided, however that, upon written notice from the defaulting Party, this thirty (30)
day period shall be extended by an additional ninety (90) days if (a) the failure cannot
reasonably be cured within the thirty (30) day period despite diligent efforts , (b) the
default is capable of being cured within the additional ninety (90) day period , and (c)
the defaulting Party commences the cure within the original thirty (30) day period and
is at all times thereafter diligently and continuously proceeding to cure the failure.
12.2 In the event of any default hereunder, the non-defaulting Party must notify the
defaulting Party in writing of the circumstances indicating the default and outlining the
requirements to cure the default. If the default has not been cured within the prescribed time
above, the non-defaulting Party may terminate this Agreement at its sole discretion by
delivering written notice to the other Party and may pursue any and all legal or equitable
remedies provided by law or pursuant to this Agreement. The rights provided in this Section
12 are cumulative such that the exercise of one or more rights shall not constitute a waiver of
any other rights.
12.In the event this Agreement is terminated because of Seller s default and Seller
wishes to again sell Net Output from the facility using the same motive force to PacifiCorp
following such termination , PacifiCorp in its sole discretion may require that Seller do so
subject to the terms of this Agreement, including but not limited to the purchase prices as set
forth in (Section 5), until the Expiration Date (as set forth in Section 2.1). At such time Seller
and PacifiCorp agree to execute a written document ratifying the terms of this Agreement.
12.4 If this Agreement is terminated as a result of Seller s default, Seller shall pay
PacifiCorp for Output Shortfall for a period of eighteen (18) months from the date of
termination plus the estimated administrative cost to acquire the replacement power.
12.Recoupment of Damages
(a)Default Security Available If Seller has posted Default Security,
PacifiCorp may draw upon that security to satisfy any damages, above.
Default Security Unavailable . If Seller has not posted Default Security, or
if PacifiCorp has exhausted the Default Security, PacifiCorp may collect
any remaining amount owing by partially withholding future payments to
Seller over a reasonable period of time. PacifiCorp and Seller shall work
together in good faith to establish the period, and monthly amounts, of
(b)
DRAFT
such withholding so as to avoid Seller s default on its commercial or
financing agreements necessary for its continued operation of the Facility.
12.Upon an event of default or termination event resulting from default under this
Agreement, in addition to and not in limitation of any other right or remedy under this
Agreement or applicable law (including any right to set-off, counterclaim, or otherwise
withhold payment), the non-defaulting Party may at its option set-off, against any amounts
owed to the defaulting Party, any amounts owed by the defaulting Party under any contract(s)
or agreement(s) between the Parties. The obligations of the Parties shall be deemed satisfied
and discharged to the extent of any such set-off. The non-defaulting Party shall give the
defaulting Party written notice of any set-off, but failure to give such notice shall not affect the
validity of the set-off.
12.Amounts owed by Seller pursuant to this paragraph shall be due within five (5)
business days after any invoice from PacifiCorp for the same.
SECTION 13: INDEMNIFICATION
13.Indemnities.
13 .1.1 Indemnity by Seller.Seller shall release , indemnify and hold
harmless PacifiCorp, its directors , officers, agents , and representatives against and
from any and all loss, fines, penalties, claims, actions or suits, including costs and
attorney s fees , both at trial and on appeal, resulting from, or arising out of or in any
way connected with (a) the energy delivered by Seller under this Agreement to and at
the Point of Delivery, (b) any facilities on Seller s side of the Point of Delivery, (c)
Seller s operation and/or maintenance of the Facility, or (d) arising from this
Agreement, including without limitation any loss , claim , action or suit, for or on
account of injury, bodily or otherwise , to , or death of, persons, or for damage to, or
destruction or economic loss of property belonging to PacifiCorp, Seller or others
excepting only such loss, claim , action or suit as may be caused solely by the fault or
gross negligence of PacifiCorp, its directors, officers , employees agents or
representatives.
13.1.2 Indemnity by PacifiCorp . PacifiCorp shall release, indemnify and
hold harmless Seller , its directors, officers , agents, lenders and representatives against
and from any and all loss, fines, penalties , claims , actions or suits, including costs and
attorney s fees , both at trial and on appeal, resulting from, or arising out of or in any
way connected with the energy delivered by Seller under this Agreement after the Point
of Delivery, including without limitation any loss , claim, action or suit, for or on
account of injury, bodily or otherwise , to , or death of, persons, or for damage to, or
destruction or economic loss of property, excepting only such loss, claim, action or suit
as may be caused solely by the fault or gross negligence of Seller , its directors
officers , employees, agents, lenders or representatives.
DRAFT
13.2 No Dedication . Nothing in this Agreement shall be construed to create any duty
, any standard of care with reference to, or any liability to any person not a Party to this
Agreement. 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 portion thereof to the other Party or
to the public, nor affect the status of PacifiCorp as an independent public utility corporation or
Seller as an independent individual or entity.
13.CONSEQUENTIAL DAMAGES EXCEPT TO THE EXTENT SUCH
DAMAGES ARE INCLUDED IN THE LIQUIDATED DAMAGES , DELAY DAMAGES
OR OTHER SPECIFIED MEASURE OF DAMAGES EXPRESSLY PROVIDED FOR IN
THIS AGREEMENT , NEITHER PARTY SHALL BE LIABLE TO THE OTHER PARTY
FOR SPECIAL , PUNITIVE , INDIRECT , EXEMPLARY OR CONSEQUENTIAL
DAMAGES WHETHER SUCH DAMAGES ARE ALLOWED OR PROVIDED BY
CONTRACT, TORT (INCLUDING NEGLIGENCE), STRICT LIABILITY, STATUTE OR
OTHERWISE.
SECTION 14: LIABILITY AND INSURANCE
14.Certificates and Certified Copies of Policies Seller shall provide PacifiCorp
with certificates of insurance evidencing the policies contemplated by Section prior to the
date by which such policies are required to be maintained as set forth in Section -' If any
coverage is written on a "claims-made " basis, the certification accompanying the policy shall
conspicuously state that the policy is "claims-made." PacifiCorp shall have the right to request
certified "true and correct" copies of the insurance policies at any time during the term of the
Agreement and Seller shall furnish to PacifiCorp within 30 days of the request.
14.2 Required Policies and Coverages. Without limiting any liabilities or any other
obligations of Seller under this Agreement, prior to the commencement of interconnection with
the System and until the termination of this Agreement , Seller shall secure and continuously
carry with an insurance company or companies rated not lower than "" by A.M. Best
Company (or with a company or companies having equivalent rating) the following insurance
coverage:
DRAFT
14.2.Employers' Liability insurance with limits of at least $1 000 000;
14.2.2 Commercial General Liability insurance with bodily injury and
property damage combined single limits of at least $1 000 000 per occurrence. Such
insurance shall include, but not necessarily be limited to, specific coverage for
contractual liability encompassing the indemnification provisions in this Agreement
broad form property damage liability, personal injury liability, explosion and collapse
hazard coverage, products/completed operations liability, and , where applicable
watercraft protection and indemnity liability;
14.2.Excess Umbrella Liability insurance with a single limit of at least
$20 000 000 per occurrence in excess of the limits of insurance provided above; and
14.2.4 All-Risk insurance in an amount at least equal to the 80% of the
replacement value of the Facility. The policy shall provide coverage in an amount
equal to the full replacement value of the Facility for "all risks " of physical loss or
damage except as hereinafter provided , including coverage for earth movement, flood
boiler and machinery, transit and off-site storage accident exposure , but excluding the
equipment owned or leased by Operator and its subcontractors and their personal
property. The policy may contain separate sublimits and deductibles subject to
insurance company underwriting guidelines. Seller shall maintain the policy in
accordance with terms available in the insurance market for similar electric generating
facilities. The policy shall include coverage for business interruption in an amount
covering a period of indemnity equal to twelve (12) months.
14.Insurance Structure Seller may satisfy the amounts of insurance required in
Section 14.2 above by purchasing primary coverage in the amounts specified or by buying a
separate excess umbrella liability policy together with lower limit primary underlying
coverage. The structure of the coverage is at Seller s option, but the total amount of insurance
must the above requirements.
14.4 Occurrence-Based Coverage . The coverage required above , and any umbrella or
excess coverage , shall be "occurrence " form policies. In the event that any policy is written
on a "claims-made" basis and such policy is not renewed or the retroactive date of such policy
is to be changed, the first insured Party shall obtain or cause to be obtained for each such
policy or policies the broadest basic and supplemental extended reporting period coverage or
tail" reasonably available in the commercial insurance market for each such policy or policies
and shall provide the other Party with proof that such basic and supplemental extended
reporting period coverage or "tail" has been obtained.
14.Endorsement Items Seller shall immediately cause its insurers to amend its
Commercial General Liability and Umbrella or Excess Liability policies with all of the
following endorsement items, and to amend its Workers ' Compensation and Auto Liability
policies with the endorsement items set forth in Sections 14.3 and 14.5.4 below:
DRAFT
14.PacifiCorp and its Affiliates, their respective directors, officers
employees , and agents as an additional insured under this policy and to the maximum
extent allowed by law, shall be provided with coverages at least as broad as those
required of the Seller by this Agreement;
14.5.2 This insurance is primary with respect to the interest of PacifiCorp
and its Affiliates, their respective directors , officers , employees , and agents; and any
other insurance maintained by them in excess and not contributory with this insurance;
14.Insurer hereby waives all rights of subrogation against PacifiCorp
and its Affiliates , their respective directors , officers, employees, and agents; and
14.5.4 Notwithstanding any provision of the policy, this policy may not be
canceled, non-renewed or materially changed by the insurer without giving ten (10)
days ' prior written notice to PacifiCorp.
14.Periodic Review PacifiCorp may review this schedule of required insurance
provided in Section 14 as often as once every two (2) years. PacifiCorp may in its discretion
require the Seller to make changes to the insurance coverage requirements in this Section 14 to
the extent reasonably necessary to cause such policies and coverages to conform to the
insurance policies and coverages typically obtained or required for power generation facilities
comparable to the Facility at the time of PacifiCorp s review takes place with the consent of
Seller, which shall not be unreasonably withheld.
SECTION 15: FORCE MAJEURE
15.1 As used in this Agreement
, "
Force Majeure" or "an event of Force Majeure
means any cause beyond the reasonable control of the Seller or of PacifiCorp which, despite
the exercise of due diligence, such Party is unable to prevent or overcome. By way of
example, Force Majeure may include but is not limited to acts of God, flood, storms, wars
hostilities, civil strife , strikes , and other labor disturbances , earthquakes , fires , lightning,
epidemics, sabotage, restraint by court order or other delay or failure in the performance as a
result of any action or inaction on behalf of a public authority which is in each case (i) beyond
the reasonable control of such Party, (ii) by the exercise of reasonable foresight such Party
could not reasonably have been expected to avoid and (iii) by the exercise of due diligence
such Party shall be unable to prevent or overcome. Force Majeure , however, specifically
excludes the cost or availability of fuel or motive force to operate the Facility or changes in
market conditions that affect the price of energy or transmission. If either Party is rendered
wholly or in part unable to perform its obligation under this Agreement because of an event of
Force Majeure, both Parties shall be excused from whatever performance is affected by the
event of Force Majeure , provided that:
15.1.1 the non-performing Party, shall, within two (2) weeks after the
occurrence of the Force Majeure, give the other Party written notice describing the
particulars of the occurrence, including the start date of the Force Majeure , the cause of
DRAFT
Force Majeure, whether the Facility remains partially operational and the expected end
date of the Force Majeure;
15.1.2 the suspension of performance shall be of no greater scope and of
no longer duration than is required by the Force Majeure;
15.1.3
to perform; and
the non-performing Party uses its best efforts to remedy its inability
15.1.4 the non-performing Party shall provide prompt written notice to the
other Party at the end of the Force Majeure event detailing the end date , cause there of
damage caused there by and any repairs that were required as a result of the Force
Majeure event , and the end date of the Force Majeure.
15.2 No obligations of either Party which arose before the Force Majeure causing the
suspension of performance shall be excused as a result of the Force Majeure.
15.Neither Party shall be required to settle 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 the Party s best interests.
SECTION 16: SEVERAL OBLIGATIONS
Nothing contained in this Agreement shall ever be construed to create an association, trust
partnership or joint venture or to impose a trust or partnership duty, obligation or liability
between the Parties. If Seller includes two or more parties, each such party shall be jointly and
severally liable for Seller s obligations under this Agreement.
SECTION 17: CHOICE OF LAW
This Agreement shall be interpreted and enforced in accordance with the laws of the state
Idaho, excluding any choice of law rules which may direct the application of the laws of another
jurisdiction.
SECTION 18: PARTIAL INVALIDITY
It is not the intention of the Parties to violate any laws governing the subject matter of this
Agreement. If any of the terms of the Agreement are finally held or determined to be invalid
illegal or void as being contrary to any applicable law or public policy, all other terms of the
Agreement shall remain in effect. If any terms are finally held or determined to be invalid
illegal or void, the Parties shall enter into negotiations concerning the terms affected by such
decision for the purpose of achieving conformity with requirements of any applicable law and
the intent of the Parties to this Agreement.
DRAFT
SECTION 19: WAIVER
Any waiver at any time by either Party of its rights with respect to a default under this
Agreement or with respect to any other matters arising in connection with this Agreement must
be in writing, and such waiver shall not be deemed a waiver with respect to any subsequent
default or other matter.
SECTION 20: GOVERNMENTAL JURISDICTION AND AUTHORIZATIONS
PacifiCorp s compliance with the terms of this Agreement is conditioned on Seller s submission
to PacifiCorp prior to the Commercial Operation Date and Seller s maintenance thereafter of
copies of all local, state and federal licenses, permits and other approvals as then may be required
by law for the construction, operation and maintenance of the Facility.
SECTION 21: SUCCESSORS AND ASSIGNS
This Agreement and all of the terms and provisions hereof shall be binding upon and inure to the
benefit of the respective successors and assigns of the Parties hereto, except that no assignment
hereof by either Party shall become effective without the written consent of both Parties being
first obtained. Such consent shall not be unreasonably withheld. Notwithstanding the foregoing,
any entity with which PacifiCorp may consolidate, or into which it may merge, or to which it
may conveyor transfer substantially all of its electric utility assets, shall automatically, without
further act, and without need of consent or approval by the Seller, succeed to all ofPacifiCorp
rights, obligations, and interests under this Agreement. This article shall not prevent a financing
entity with recorded or secured rights from exercising all rights and remedies available to it
under law or contract. PacifiCorp shall have the right to be notified by the financing entity that it
is exercising such rights or remedies.
SECTION 22: ENTIRE AGREEMENT
22.This Agreement supersedes all prior agreements, proposals, representations
negotiations, discussions or letters, whether oral or in writing, regarding PacifiCorp ' s purchase
of Net Output from the Facility. No modification of this Agreement shall be effective unless it
is in writing and signed by both Parties.
22.2 By executing this Agreement, each Party releases the other from any claims
known or unknown , that may have arisen prior to the Effective Date with respect to the
Facility and any predecessor facility proposed to have been constructed on the site of the
Facility.
SECTION 23: NOTICES
All notices except as otherwise provided in this Agreement shall be in writing, shall be
directed as follows and shall be considered delivered if delivered in person or when deposited
in the U.S. Mail, postage prepaid by certified or registered mail and return receipt requested.
DRAFT
Notices PacifiCorp Seller
All Notices PacifiCorp
825 NE Multnomah Street Portland
OR 97232
Attn: Contract AdministratIOn
Suite 600
Phone: (503) 813 - 5952
Facsimile: (503) 813 - 6291
Duns: 00-790-9013
Federal Tax ID Number: 93-0246090
All Invoices:Attn: Back Office, Suite 700
Phone: (503) 813 - 5578
Facsimile: (503) 813 - 5580
Scheduling:Attn: Resource Planning, Suite 600
Phone: (503) 813 - 6090
Facsimile: (503) 813 - 6265
Payments:Attn: Back Office, Suite 700
Phone: (503) 813 - 5578
Facsimile: (503) 813 - 5580
Wire Transfer:Bank One N.
To be provided in separate letter from
PacifiCorp to Seller
Credit and Attn: Credit Manager, Suite 1900
Collections:Phone: (503) 813 - 5684
Facsimile: [phone]
With Additional Attn: PacifiCorp General Counsel
Notices of an Phone: [phone]
Event of Default Facsimile: [phone]
or Potential
Event of Default
to:
The Parties may change the person to whom such notices are addressed, or their addresses, by
providing written notices thereof in accordance with this Section.
IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be executed
in their respective names as of the date first above written.
PacifiCorp Seller
By:
Name:
Title:
By:
Name:
Title:
DRAFT
DRAFT
EXHIBIT A
DESCRIPTION OF SELLER'S FACILITY
(Seller to Complete)
Seller s Facility consists of generator(s) manufactured by
. More specifically, each generator at the Facility is described as:
Type (synchronous or inductive):
Model:
Number of Phases:
Rated Output (kW):
Rated Voltage (line to line):
Rated Current (A): Stator: A; Rotor:
Maximum kW Output:
Minimum kW Output:
Manufacturer s Guaranteed Cut-in Wind Speed (if applicable):
Facility Capacity Rating: kW at
Identify the maximum output of the generator(s) and describe any differences between that
output and the Nameplate Capacity Rating:
Rated Output (kV A):
Maximum kV A Output:kVA
Station service requirements, and other loads served by the Facility, if any, are described
as follows:
Location of the Facility: The Facility is located in
is more particularly described as follows:
County, Idaho. The location
(legal description of parcel)
Power factor requirements:
Rated Power Factor (PF) or reactive load (kV AR):
Attach documentation of the power curve for the generator(s).
DRAFT
EXHIBIT B
POINT OF DELIVERY / PARTIES' INTERCONNECTION FACILITIES
(Seller to provide its own diagram and description)
Instructions to Seller:1. Include description of point of metering, and Point of Delivery2. Provide interconnection single line drawing of Facility including any transmission
facilities on Seller s side of the Point of Delivery.
DRAFT
EXHIBIT C
REQUIRED FACILITY DOCUMENTS
Qualifying Facility Number from FERC:
The following Documents are required to complete this project:
Easements:
Permits:
DRAFT
EXHIBIT D
ENERGY DELIVERY SCHEDULE
(Project Name)
Scheduled Monthly
Energy Delivery Ave kW/mo
January
February
March
April
May
June
July
August
September
October
November
December
TOTAL:
Planned Outages. Seller will provide a Planned Outage schedule annually not to exceed
hours per per year.
D- 1
DRAFT
EXHIBIT E
START-UP TESTING
Required factory testing includes such checks and tests necessary to determine that the
equipment systems and subsystems have been properly manufactured and installed, function
properly, and are in a condition to permit safe and efficient start-up of the Facility, which may
include but are not limited to:
Test of mechanical and electrical equipment;
Calibration of all monitoring instruments;
Operating tests of all valves, operators, motor starters and motor;
Alarms, signals, and fail-safe or system shutdown control tests;
Point-to-point continuity tests;
Bench tests of protective devices; and
Tests required by manufacturer(s) and designer(s) of equipment.
Required start-up tests are those checks and tests necessary to determine that all features
and equipment, systems, and subsystems have been properly installed and adjusted, function
properly, and are capable of operating simultaneously in such condition that the Facility is
capable of continuous delivery into PacifiCorp s electrical system, which may include but are
not limited to:
Turbine/generator mechanical runs and functionality;
System operation tests;
Brake tests;
Energization of transformers;
Synchronizing tests (manual and auto);
Excitation and voltage regulation operation tests;
Auto stop/start sequence;
Completion of any state and federal environmental testing requirements; and
Tests required by manufacturer(s) and designer(s) of equipment.
For wind projects only, the following Wind Turbine Generator Installation Checklists are
required documents to be signed off by Manufacturer or Subcontract Category Commissioning
Personnel as part of the Commissioning and startup testing:
Turbine Installation
Foundation Inspection
Controller Assembly
Power Cables
Cable Installation Checklists including:Controller
Top Deck / Yaw Deck
Tower Top Section / Saddle
Mid Section Cables or buss bars
Base Section
Tower Base Section
Tower Lights and Outlets
Tower Mid Section
Tower Top Section
Nacelle
Rotor
E- 1
EXHIBIT F-
MOTIVE FORCE PLAN
WIND SPEED DATA SUMMARIES & HOURLY WIND PROFILE
Fl- 1
DRAFT
DRAFT
EXHIBIT F-
ENGINEER'S CERTIFICATION
(1) THAT THE WIND DATA SUMMARIES IN EXHIBIT F-l ARE ACCURATE;
(Licensed Professional Engineer s certification)
(2) THAT THE AVERAGE ANNUAL NET OUTPUT ESTIMATE IS KWH
PER YEAR IN EACH FULL CALENDAR YEAR OF THIS AGREEMENT BASED ON
THE MOTIVE FORCE PLAN IN EXHIBIT F -
(Licensed Professional Engineer s certification)
(3) THAT THE FACILITY, UNDER AVERAGE DESIGN CONDITIONS, LIKELY WILL
GENERATE NO MORE THAN 10 aMW IN ANY CALENDAR MONTH.
(Licensed Professional Engineer s certification)
F2- 1
DRAFT
EXHIBIT G
SAMPLE ENERGY PURCHASE PRICE CALCULATIONS
The following are samples of calculations of energy purchase prices using the formula and tables
in Section 5.
The calculation for the non-Ievelized purchase price during an On-Peak Hour in May of 2009
equals $76.73/MWh (the 2009 annual rate for Conforming Energy) multiplied by 92% (0.92)
(the May On-Peak Hour multiplier) minus $5.l0/MWh (the wind integration cost), which equals
$65.49/MWh.
Table 3: Sample calculations for non-Ievelized On-Peak Conforming Energy in 2009: Purchase
Price = (annual rate * monthly On-Peak multiplier) - wind integration cost.
Conforming
Energy Calculated Purchase
Annual Rate On- Peak Wind Price for 2009 On-
for 2009 Hour Integration Peak Conforming
Month (per MWh)Multiplier Cost Energy (per MWh)
January $76.103%$5.$73.
February $76.105%$5.$75.47
March $76.95%$5.$67.
April $76.95%$5.$67.
May $76.92%$5.$65.49
June $76.94%$5.$67.
July $76.121%$5.$87.
August $76.121%$5.$87.
September $76.109%$5.$78.
October $76.115%$5.$83.
November $76.110%$5.$79.
December $76.129%$5.$93.
Table 4: Sample calculations for non-Ievelized Off-Peak Conforming Energy in 2009: Purchase
Price = (annual rate * monthly Off-Peak multiplier) - wind integration cost.
Conforming
Energy Calculated Purchase
Annual Rate Off-Peak Wind Price for 2009 Off-
for 2009 Hour Integration Peak Conforming
Month (per MWh)Multiplier Cost Energy (per MWh)
January $76.94%$5.$67.
February $76.97%$5.$69.
March $76.80%$5.$56.28
April $76.76%$5.$53.21
G -
DRAFT
Conforming
Energy Calculated Purchase
Annual Rate Off-Peak Wind Price for 2009 Off-
for 2009 Hour Integration Peak Conforming
Month (per MWh)Multiplier Cost Energy (per MWh)
May $76.63%$5.$43.24
June $76.65%$5.$44.
July $76.92%$5.$65.49
August $76.106%$5.$76.23
September $76.99%$5.$70.
October $76.105%$5.$75.47
November $76.96%$5.$68.
December $76.120%$5.$86.
G- 2
DRAFT
EXHIBIT H
Seller Authorization to Release Generation Data to PacifiCorp
(Interconnection Customer Letterhead)
Transmission Services
Attn: Director, Transmission Services
825 NE Multnomah, Suite 1600
Portland, OR 97232
Interconnection RequestRE:
Dear Sir:
hereby voluntarily authorizes PacifiCorp s Transmission business unit to
s generator interconnection information and generator meter data, s Qualifying Facility located in the town ofCounty, with Marketing Affiliate employees ofPacifiCorp
Energy, including, but not limited to those in the Commercial and Trading group.
acknowledges that PacifiCorp did not provide it any preferences, either
operational or rate-related, in exchange for this voluntary consent.
share
relating to
Name
Title
Date
H -
DRAFT
EXHIBIT I
Template Seller Certification of Conditions for Commercial Operation
(Seller Letterhead)
(Address to PacifiCorp)
Qualifying FacilityRE:
Dear Sir:
Name
Title
Date
I - 1
Jean Jewell
From:
Sent:
To:
Cc:
Subject:
James T. Carkulis (mtli~in-tch.com)
Wednesday, April 01 , 20094:39 PM
Griswold , Bruce fMkt Function)
Collin Rudeen; Younie, John
Re: PURPA contract requests
Bruce:
Let's move forward on a 20 MW project until we figure out the rest. Let's use XRG-DP 10 for now as the project.
Thank you.
Regards
James T. Carkulis
Confidential & Proprietary
Successfully Merging Free Market Principles with Societal Expectations
Exergy Development Group, LLC
(p) 208.336.9793
(I) 208.336.9431
(m) 406.459.3013
(e) mtlit1Pin-tch.com
This electronic or printed document contains information which (a) may be LEGALLY PRIVILEGED, PROPRIETARY IN NATURE, OR OTHERWISE PROTECTED
BY LAW FROM DISCLOSU RE, and (b) is intended only for the use of the Addressee(s) named above. If the reader of this message is not the intended recipient
or the employee or agent responsible to deliver it to the intended recipient , you are hereby notified that any dissemination , distribution or copying of this
communication is strictly prohibited. If you have received this communication in error, please immediately notify us by telephone, and return the original message
to us at the above address via first class, express mail. Thank you
To: James T. Carkulis
Cc: Collin Rudeen Younie , John
Sent: Monday, March 23, 2009 11 :34 AM
Subject: RE: PURPA contract requests
James
As a follow-up to your QF requests, we have worked through transmission alternatives at Borah for your six
proposed QF projects. Based on your proposed delivery point to the Borah substation, we only have
import capabilities to our Utah system to serve load from Brady on a firm basis of 23 MW total. Based on your
requests, we can accommodate a single 20MW project. For a transaction at Borah, Pac would do redirect of
existing Borah reservation to Brady to facilitate a 23MW transaction.
From your project submittals, you have four standard QF projects. We will need to know which of the
standard proj ects you would like to proceed with. Weare currently preparing a draft intermittent resource PP A
and can provide you the document the end of this week or first of next week. As you are aware, new avoided
costs have been approved for the standard QF PP A and are published on the Idaho PUC website.
Let me know if you have questions. I will forward you the draft PPA as soon as we finish it up.
Bruce Griswold
PacifiCorp C&T
503-813-5218 Office
503-702-1445 Cell
503-813-6260 Fax
From: James T. Carkulis (mailto:mtli(Q)in-tch.com)
Sent: Tuesday, February 17, 2009 5:46 AM
To: Griswold, Bruce \Mkt Function!; Collin Rudeen; Lawrence R. Leib
Cc: Younie, John
Subject: Re: PURPA contract requests
Bruce:
I believe you have the motive force raw data and also compilations and analyses.
I would like to move both the 4 contract front and the 2 contract front forward as per your indication of getting these
finished quickly.
We are congizant of the filing by Rocky Mountain Power, but that should interfere with these negotiations.
We anticipate having online dates for these projects by 12-December-201 O.
Regards
James T. Carkulis
Confidential & Proprietary
Successfully Merging Free Market Principles with Societal Expectations
Exergy Development Group, LLC
(p) 208.336.9793
(I) 208.336.9431
(m) 406.459.3013
(e) mtlilG1in-tch.com
This electronic or printed document contains information which (a) may be LEGALLY PRIVILEGED, PROPRIETARY IN NATURE, OR OTHERWISE
PROTECTED BY LAW FROM DISCLOSURE, and (b) is intended only for the use of the Addressee(s) named above. If the reader of this message is not the
intended recipient, or the employee or agent responsible to deliver it to the intended recipient, you are hereby notified that any dissemination , distribution or
copying of this communication is strictly prohibited. If you have received this communication in error, please immediately notify us by telephone, and return the
original message to us at the above address via first class, express mail. Thank you
To: Collin Rudeen James Carkulis Lawrence R. Leib
Cc: Younie. John
Sent: Friday, January 23 , 2009 3:04 PM
Subject: RE: PURPA contract requests
here is the call in information - the time is 9 AM Mountain and 8AM Pacific.
Bruce Griswold from PacifiCorp has invited you to a Voice Conference (Mtg ID 121212) on JAN, 28 2009 at 8:00 AM
America/Los Angeles. Ifprovided, use the following password: 121212
To attend a Voice Conference:Call 503-813-5600 (toll free #800-503-3360), follow the instructions provided and
enter Mtg ID 121212 when prompted.
Bruce Griswold
PacifiCorp C&T
503-813-5218 Office
503-702-1445 Cell
503-813-6260 Fax
From: collin.rudeenCCDamail.com (mailto:collin.rudeen(Q)gmail.com) On Behalf Of Collin Rudeen
Sent: Friday, January 23, 2009 12:39
To: Griswold, Bruce \Mkt Function!
Cc: Younie, John; Peter Richardson; James Carkulis; Lawrence R. Leib
Subject: Re: PURPA contract requests
Bruce
Does 9:00, MST on Wednesday next week work for you guys? Pete will not be on the call. James and maybe
Larry Leib will be on the call, in addition to myself.
Regards
Collin
On Thu, J an 22, 2009 at 10: 18 AM, Griswold, Bruce tMkt Function J ~Bruce. Griswold~pacificorp. com
wrote:
Collin
Thanks for the documents. We will review and schedule a time to discuss all projects next week. Purpose
the call would be to clarify the submittals, schedules, and deliverables. Who should we schedule the call
with? We would tentative look at Wednesday for a call.
If Pete will on the call, we will schedule to have our attorney also. Thanks.
Bruce Griswold
PacifiCorp C&T
503-813-5218 Office
503-702-1445 Cell
503-813-6260 Fax
From: collin.rudeenCCDamail.com (mailto:collin.rudeenCCDamail.com On Behalf Of Collin Rudeen
Sent: Thursday, January 22 20097:51 AM
To: Griswold, Bruce \Mkt Function!; Younie, John
Cc: Peter Richardson; James Carkulis
Subject: PURPA contract requests
John and Bruce
Please see the three attached files, sent at Peter Richardson s request.
Regards
Collin Rudeen
Lead Project Engineer
Exergy Technology Concepts
802 W Bannock, ste 1200
Boise ID 83702
ph: 208.336.9793
crudeen~exergydevelopment. com
This electronic or printed document contains information which (a) may
be LEGALLY PRIVILEGED, PROPRIETARY IN NATURE, OR OTHERWISE PROTECTED BY
LAW FROM DISCLOSURE, and (b) is intended only for the use of the
Addressee(s) named above. If the reader of this message is not the
intended recipient, or the employee or agent responsible to deliver it
to the intended recipient, you are hereby notified that any
dissemination, distribution or copying of this communication is strictly
prohibited. If you have received this communication in error, please
immediately notify us by telephone, and return the original message to
us at the above address.
Collin Rudeen
Lead Project Engineer
Exergy Technology Concepts
802 W Bannock, ste 1200
Boise ID 83702
ph: 208.336.9793
crudeen~exergydevelopment. com
This electronic or printed document contains information which (a) may
be LEGALLY PRIVILEGED, PROPRIETARY IN NATURE, OR OTHERWISE PROTECTED BY
LAW FROM DISCLOSURE, and (b) is intended only for the use of the
Addressee(s) named above. If the reader of this message is not the
intended recipient, or the employee or agent responsible to deliver it
to the intended recipient, you are hereby notified that any
dissemination, distribution or copying of this communication is strictly
prohibited. If you have received this communication in error, please
immediately notify us by telephone, and return the original message to
us at the above address.