20110110Application.pdf

,.ROCKY MOUNTAINPOR
A DMSl OF PACOP
201 So Main, Suite 2300
Salt Lake Cit, Ut 84111
lOll JA.A! 1 f'. ;ir'i lJ 11M 9: 39
Janua 8, 2011
VI OVERNIGHT DELIVERY
Idaho Public Service Commssion
472 W. Washion Street
P.O. Box 83720
Boise, Idaho 83720-0074
p..:.-l l -D (
Attention: Jean D. Jewell
Commssion Secreta
RE: In the Matter of the Applications of Rocky Mountain Power for Approval of Power Purchas
Agreements Between Rocky Mountain Power and Cedar Creek Wind
Please fmd enclosed the original and seven (7) copies each of five separte Applications and
Power Purchase Agreements between Rocky Mounta Power under which Cedar Creek would
sell and Rocky Mounta Power would purchae electrc energy generted from each of the five
Cedar Creek Wind projects ("Projects") locted in Bingham County, Idaho:
Yroject Name
v Rattlesnae Canyon
Coyote Hil
North Point
Steep Ridge
Five Pine
Nameplate Capacity
Megawatt (M
27.6
27.6
27.6
25.2
25.2
Monthly Average MW
Delivery
9.4
9.4
9.8
9.8
9.4
Inquies may be directed to Ted Weston, Idao Reguatory Manager at [phone], or
Danel Solander, Senior Counsel, at [phone].
y~rylL~FY Yours,! / i 11
i W · tM 1/U!
¡ II
Jeffey K. Laren
Vice President, Reguation
Enclosures
iûu JAN t 0 AM 9:41
PA C. -E -((-of
PROJECT
RATTLESNAKE CANYON
Mark C. Moench
Daniel E. Solander
Yvonne R. Hogle
Rocky Mountain Power
201 South Main Street, Suite 2300
Salt Lake City, Uta 84111
Telephone: (80l) 220-4014
Fax: [phone]
Email: mark.moenchimpacificorp.com
daniel.solanderimpacificorp.com
yvonne.hogle(ßpacificorp.com
Attorneys for Rocky Mountain Power
-.,j"
.'. ;.l=
lOJ I JArlj 0 AM 9=41
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE
APPLICATION OF ROCKY
MOUNTAIN POWER FOR
APPROVAL OF A POWER
PURCHASE AGREEMENT
BETWEEN RMP AND CEDAR
CREEK WIND LLC
)
)
)
)
)
)
)
CASE NO. PAC-E-11-0r
APPLICATION OF
ROCKY MOUNTAIN POWER
Comes now Rocky Mountain Power ("RMP" or "Company" or "PacifiCorp"), in
accordance with RP 52 and the applicable provisions of the Public Utility Reguatory
Policies Act of 1978 ("PURP A"), hereby respectfully applies to the Idaho Public Utilties
Commission ("IPUC" or "Commission") for an Order accepting or rejecting the published
avoided cost rate Power Purchase Agreement ("PP A") between RMP and Cedar Creek
Wind LLC ("Cedar Creek" or "Seller') under which Cedar Creek would sell an RMP
would purchase electric energy generated from each of the five Cedar Creek Wind
projects ("Projects") located in Bingham County, Idaho:
Project Name Nameplate Capacity
Megawatt (MW)
27.6
27.6
27.6
25.2
25.2
Monthly Average MW
Delivery
Rattlesnake Canyon
Coyote Hil
North Point
Steep Ridge
Five Pine
9.4
9.4
9.8
9.8
9.4
This application is specific to the Rattlesnake Canyon Project ("Facilty"). In support of
this Application RMP represents as follows:
1. Communcations regarding this Application should be addressed to:
Ted Weston
201 South Main, Suite 2300
Salt Lake City, Utah 84111
Telephone: [phone]
Fax: [phone]
Email: ted.weston(ßpacificorp.com
and to:
Danel E. Solander
201 South Main, Suite 2300
Salt Lake City, Utah 84111
Telephone: [phone]
Fax: [phone]
Email: danie1.solander(ßpacificorp.com
In addition, the Company respectfully requests that all data requests regarding ths
matter be addressed to one or more of the following:
Bye-mail (preferred)
By regular mail
dataequest(fpacificorp.com
Data Request Response Center
PacifiCorp
825 NE Multnomah, Suite 2000
Portland, OR 97232
I. BACKGROUND
2. Sections 201 and 210 ofPURPA, and pertinent regulations of the Federal
Energy Regulatory Commission ("FERC"), require that regulated electric utilties
purchase power produced by cogenerators or small power producers that obtain
qualifying facility ("QF") status. The rate a QF receives for the sale of its power is
generally referred to as the "avoided cost" rate and is to reflect the incrementa cost to an
electric utility of electric energy or capacity or both, which, but for the purchase from the
QF, such utility would generate itself or purchase from another source. The Commission
has authority under PURP A Sections 201 and 210 and the implementing regulations of
the FERC, 18 C.F.R. § 292, to set avoided costs, to order electric utilities to enter into
fixed-term obligations for the purchase of energy from QFs, and to implement FERC
rules.
3. Cedar Creek proposes to design, construct, install, own, operate, and
maintain a 27.6 megawatt ("MW") (Facility Capacity Rating) wind generating facilty
named Rattlesnake Canyon, to be located in Bingham County, Idaho. The Facility will be
a QF under the applicable provisions of PURP A. The PPA for this Facility and the other
four Cedar Creek projects; Coyote Hil, North Point, Steep Ridge, and Five Pine, are all
executed by Scott Montgomery, President of Cedar Creek Wind LLC, being the
authorized manager of each aforementioned Project.
4. On November 5, 2010, RMP along with Idaho Power and Avista
Corporation filed a Joint Petition and Motion seeking a reduction in the published
avoided cost rate eligibility cap from 10 aMW to 100 kilowatts ("kW"). Case No. GNR-
E-1O-04. On December 3, 2010, the Commission issued Order No. 32131 setting a
Modified Procedure comment schedule with which to develop a record for its decision
regarding the Joint Petition and Motion's request to lower the published avoided cost rate
eligibility cap. Comments were provided December 22,2010, Reply Comments are due
Januar 19,2011, and Oral Arguments are scheduled for Januar 27,2011. As par of the
Order, the Commission ordered that its decision regarding whether to reduce the
published avoided cost eligibility cap become effective on December 14,2010.
5. RMP has an obligation under federal law, FERC regulations, and ths
Commission's Orders to enter into power purchase agreements with PURPA QFs. As
stated in the Joint Petition fiing, RMP has received multiple requests from PURPA wind
QF developers for published avoided cost rate PPAs. The Company continues to process
these requests as par of its normal course of business with the appropriate level of due
diligence to ensure these potential resources comply with all PURP A regulations and
Commission Orders and are submitted to this Commission for review and decision, as is
its legal obligation. However, the request in this Application, the other four Applications
for Cedar Creek Wind projects, as well as several other QF PP A Applications that will be
filed over the course of the next several months, is made with the specific reservation of
rights and incorporation of the averments set forth in the Joint Petition regarding the
possible negative effects to the both the utility and its customers of additional and
unfettered PURP A QF generation on system reliabilty, utility operations, and costs of
incorporating and integrating such a large penetration level of PURP A wind QF
generation into the utility's system.
6. RMP is concerned with the increase in power supply costs, and the
resulting increase in rates to its customers, that the current published SAR-methodology
avoided cost prices causes as compared to applying the IRP-methodology or the results
from a competitive request for proposal solicitation. A non-standard QF project using the
Commission Ordered IRP-methodology addresses the specific operating characteristics of
the QF as part of the Company's resource portfolio, resulting in avoided cost prices tied
to that specific resource and generally, at a lower cost than the SAR-derived avoided cost
prices. The magnitude of standard wind QF project development in Idaho has reached
monumental levels and at the curent published avoided cost levels will have a significant
impact on the net power cost portion of its Idaho and other jurisdiction customer's rates.
The Rattlesnake Canyon QF Contract and the other four Cedar Creek Idaho wind QF
contracts being submitted to the Commission total 133 MW, representing 30 percent of
the 445 MW QFs that are curently requesting published avoided cost rate wind contracts.
These proposed projects are not small family or community-based developers doing a
single project, but rather large-scale, sophisticated developers with legal and technical
assets who have disaggregated large projects into multiple projects in order to meet the
10 aMW threshold and qualify of published avoided cost contracts. Cedar Creek Wind
originally submitted a bid into the Company's 2009R renewable Request for Proposal
(RFP) as a single 151 MW project but did not make the RFP short-list of bids. In March
2010, Cedar Creek requested QF pricing for two 78 MW projects. The projects were
priced using the IRP-methodology for large Idaho non-stadard QFs. RMP prepared and
delivered avoided cost prices which Cedar Creek rejected as not meeting their price
theshold and therefore too low. In May 2010, Cedar Creek resubmitted five individual
QF projects totaing 133 MW for Idaho avoided cost pricing. The five projects, which
share a common interconnection under the original single large project's interconnection
agreement and have a single owner, complied with all PURP A's regulation including the
I-mile separation requirement, and met all Idaho rules and Commission Orders. Five
published avoided cost contracts were prepared and executed. The Company points out
that at the avoided cost price difference between the SAR-methodology compared to the
IRP-methodology results in the Company paying an additional $10 milion per year for
the power from the five projects. Expanding these standard avoided cost prices to the
other 312 MW of standard QF contract requests versus using the IRP-methodology would
results in an additional cost of $23 milion per year. In this instance,. the published
avoided cost prices are significantly higher than the avoided cost prices produced using
the IRP-methodology. Furher, standard purchases result in an inherent overpayment to
the extent that the project does not offer the same delivery attibutes as the proxy
resource on which the avoided costs are calculated. As standard pricing becomes
available to larger projects, for longer contract terms, the magnitude of this overpayment
increases. Because a contract under the published QF rate has minimal flexibilty to
adjust pricing or the terms and conditions in the contract based on the project's
characteristics, wind resources have found the QF path more conducive to gaining a long
term power purchase agreement without the project specific adjustments they would
encounter through the IRP-methodology or a competitive request for proposal
solicitation. This divergence between applying the project specific characteristics through
the IRP-tnethodology and the stadard default pricing natue of the QF process wil lead
to Idaho customers on the Company's system of caring the burden of a higher-cost (i.e.,
above avoided cost) QF resource than they would otherwse pay for.
7. The Revised Protocol agreement addresses treatment of New QF
Contracts under State Resources in Section C. as follows: "Costs associated with any
New QF Contract, which exceeds the costs PacifiCorp would have otherwse incured
acquiring Comparable Resources, wil be assigned on a situs basis to the State approving
such contract." Therefore if the Commission approves this purchase power agreement the
Company respectfully requests that the $10 milion anua incremental expense
associated with these five contracts be situs assigned to the state of Idaho. This would be
in addition to Idaho's allocation of the cost produced by IRP-methodology valuation
representative of the avoided cost RMP would have otherwise incured acquiring these
resources.
8. Rocky Mountain Power is concerned with the impact on its electrical
system and reliability in adding the Cedar Creek Wind projects and other large volumes
of QF wind. Historically the generation threshold for published avoided cost rates had
been low, and the costs associated with capacity contribution and integration for an
intermittent resource have been deemed to have minimal impact on the Company's
electric system. With curent thresholds in Idaho increased to 10aMW which equates to a
wind QF project in the nameplate capacity range of 20 to 30MW, the cost to the
Company and thus to the customer for integration, capacity contribution, and
transmission capacity are of greater significance and need to be revisited in the
determination of avoided costs for intermittent resources. In those cases where a resource
is added in Idaho and there is insufficient load to absorb or use the generation, the added
QF power output must be moved elsewhere to be useful to the system and serve the
Company's network load. This is primarily expected to be the case in the off-peak time
period when customer loads are normally lower and canot absorb the wind generation,
but also may occur with the addition of significant numbers of 10 aMW QF projects or a
small number of large QF projects. While the Company recognzes that locational
transmission constraints and the need for transmission upgrades should not prevent
project development, any incremental cost reflecting the constraint or upgrade should be
borne by the developer and not the ratepayer. Analysis of transmission system constraints
and the cost of options for dealing with those constraints should be incorporated into the
QF pricing and contract process so that appropriate adjustments can be made.
9. Even though RMP is legally obligated to continue to negotiate, execute,
and submit PURP A QF contracts for Commission review, it also feels obligated to
reiterate that the continuing and unchecked requirement for the Company to acquire
additional intermittent and other QF generation regardless of its need for additional
energy or capacity on its system not only circumvents the Integrated Resource Planing
process and creates system reliability and operational issues, but it also increases the
price its customers must pay for their energy needs.
II. THE POWER PURCHASE AGREEMENT
10. On December 22, 2010, RMP and Cedar Creek entered into a PPA
pursuant to the terms and conditions of the various Commission Orders applicable to this
PURPA agreement for a wind resource. See Order Nos. 29632, 30423, 31021, and 31025.
A copy of the PP A is attched to this Application as Attchment NO.1. Under the terms
of this PP A, Cedar Creek elected to contract with RMP for a 20-year term using the non-
levelized published avoided cost rates as curently established by the Commission for
energy deliveries of less than 10 average megawatts ("aMW"). This PP A was executed
by Cedar Creek on December 13, 2010. It was subsequently executed by RMP on
December 22,2010, and now fied for the Commission's review on Januar 7, 2011.
11. The nameplate rating of this Facility is 27.6 MW. Cedar Creek has attested
and documented through its generation profile that the Facility will not exceed 10 aMW
on a monthly basis. Furhermore, as described in Section 5.3 of the PPA, should the
Facilty exceed 10 aMW on a monthly basis, RMP will accept the energy that does not
exceed the Maximum Facilty Delivery Rate (Inadvertent Energy), but will not purchase
or pay for this Inadvertent Energy.
12. This PURPA wind agreement includes the Mechanical Availability
Guaantee ("MAG"), Wind Integration Cost adjustment, and Wind Forecasting cost
sharing as required in Commission Order No. 30497. In addition, Cedar Creek and RMP
have agreed to Delay Liquidated Damages and associated Delay Security provisions of
$1,429,585 for the Rattlesnake Canyon project with retur of the security as specific PPA
milestones are met.
13. Cedar Creek has elected October 1, 2012, as the Scheduled Commercial
Operation Date for this Facility. The PPA establishes numerous requirements in Section 2
that Cedar Creek must meet prior to RMP accepting energy deliveries from this Facility.
Cedar Creek must deliver a monthly report on progress staring in October 2011 and
RMP will monitor compliance with these initial requirements. In addition, RMP wil
monitor the ongoing contractual requirements through the full term of this PP A.
14. The PP A, as signed and submitted by the paries thereto, contains non-
levelized published avoided cost rates in conformity with applicable IPUC Orders. In
addition, Cedar Creek shall reimburse RM for the cost of securing the network resource
and transmission service request.
15. Cedar Creek's projects share a common collector substation for the five
wind QF projects including Rattlesnake Canyon, which then delivers aggregated energy
via a Cedar Creek owned 345-kV transmission line to the Point of Delivery at the Goshen
Substation. This Facility and the other four Cedar Creek project's net output generation
is individually metered at the collector substation and each PP A contains an Addendum L
which distributes the line losses between the collector substation and the Point of
Delivery to each project based on their percentage of the monthly net output to the
aggregated delivery at the Point of Delivery.
16. The PP A provides that all applicable interconnection costs and monthly
operational or maintenance charges as defined in the Generator Interconnection
Agreement ("GIA") will be assessed to Seller. PURPA QF generation must be designated
as a network resource ("NR") on RMP's system, which requires the Company's merchant
fuction to submit a Transmission Service Request ("TSR") on behalf of the Facility to
PacifiCorp Transmission. Submission of such request will occur by January 30, 2011.
Upon resolution of any and all required upgrades, if necessar, to acquire network
transmission capacity for this Facility's delivery of energy and upon execution of the
PPA and the GIA, this Facility may then be designated as a network resource.
17. Seller has selected October 1, 2012, as the Scheduled Commercial
Operation Date. Cedar Creek has been advised that it is Cedar Creek's responsibilty to
work with PacifiCorp Transmission to ensure that suffcient time and resources will be
available to constrct the interconnection facilities, and transmission upgrades if required,
in time to allow the Facilty to achieve the Scheduled Commercial Operation Date. Cedar
Creek has been fuher advised that delays in the interconnection or transmission process
are not Force Majuere events in achieving the Scheduled Commercial Operation Date and
if Seller fails to achieve the Scheduled Commercial Operation Date at the times specified
in the PP A, delay damages will be assessed.. Cedar Creek has advised RMP that is has
been advised of and accepted the responsibility and risk associated with meeting the
Schedule Commercial Operation Date requirements relating to interconnection and
possible transmission upgrades.
18. Cedar Creek has also been made aware of and accepted the provisions of
the PPA regarding curailment or disconnection of its Facility should certain operating
conditions develop on the Company's system. Section 6 of the PP A defines the conditions
for curtailment and obligations of Cedar Creek in the event of curailment.
19. Section 2.1 of the PPA provides that the PPA will not become effective
until the Commission has approved all of the PP A's terms and conditions and issued a
final and non-appealable order that declares that all payments RMP makes to Cedar
Creek for purchases of energy wil be allowed as prudent and legitimate expenses for
ratemaking puroses and that Idaho will allow PacifiCorp to recover through its rates in
Idaho any shortfall in recovery of power purchase costs under the PP A if any other public
utility commission with jurisdiction over PacifiCorp disallows recovery of any par of
that state's proportionate share of said expenses.
III. MODIFIED PROCEDURE
20. RMP believes that a hearng is not necessar to consider the issues
presented herein and respectfully requests that this Application be processed under
Modified Procedure, i.e., by wrtten submissions rather than by hearing. Reference
Commission Rules of Procedure, rDAPA 31.01.01.201-204. If, however, the Commission
determines that a techncal hearing is required, the Company stads ready to prepare and
present its testimony in such hearing.
WHEREFORE, Rocky Mountain Power respectfully requests that the
Commission issue an Order accepting or rejecting the published avoided cost rate Power
Purchase Agreement ("PPA") between RMP and Cedar Creek Wind LLC ("Cedar Creek"
or "Seller') under which Cedar Creek would sell and RMP would purchase electric energy
generated from the Rattlesnake Canyon facility.
Dated this 7th day of Janua, 2011
Respectfuly submitted,
'"
By l//~ ,kí.~../1tr7
Daniel E. Solander r /
Attorney for Rocky Mountain Power
POWER PURCHASE AGREEMENT
BETWEEN
CEDAR CREEK WIND, LLC
Relating to RATTLESNAKE CANYON, a Wind Turbine Generation Project
a non-fueled, on-system, Intermittent Resource with Mechanical Availability Guarantee,
Idaho Qualifyng Facility-10aMW/Month or less
AND
PACIFICORP
ZOff JÂri '0 AM 9: 41
Section 1: Definitions ........... ..... ....... ....... ........ .... ............... ........ ........... ........ ................. .....1
Section 2: Ter, Commercial Operation Date ....................................................................9
Section 3: Representations and Waranties ................................................... ...... ..... ...... ...13
Section 4: Delivery of Power; Availabiliy Guaranty .......................................................15
Section 5: Purchase Prices..... .......................... ............... ............. ................... ................ ...17
Section 6: Operation and Control.................. ........ ...... ............ ................ .... .................... ..20
Section 7: Motive Force ....................................................................................................23
Section 8: Generation Forecasting Costs...........................................................................23
Section 9: Meterng; Reports and Records ......................................... .......... .....................24
Section 10: Bilings, Computations and Payments............................................................26
Section 11: Securty..... ...................... ...................................... ..................... ...... ..... ..........27
Section 12: Defaults and Remedies...................................................................................28
Section 13: Indemnification; Liabilty................................................ .................... ........... 31
Section 14: Insurance........................................................................................,................32
Section 15: Force Majeure.................................................................................................33
Section 16: Several Obligations ........................................................................................34
Section 17: Choice of Law ................................................................................................34
Section 18: Paral Invalidity .............................................................................................34
Section 19: Waiver .........................................................................................................!..34
Section 20: Governental Jursdiction and AuthorizatioIls ...... ........................................ 34
Section 21: Successors and Assigns ..................................................................................35
Section 22: Entire Agreement............................................................................................35
Section 23: Notices............................................................................................................35
Cedar Creek Wind, LLC-Rattlesnake Canyon
POWER PURCHASE AGREEMENT
THIS POWER PURCHASE AGREEMENT re1ating to MTTLESNAKE CANYON, a wind
tubine generation project entered into ths 11M day of~\; , 20lQ is between Cedar
Creek Wind, LLC, a Delaware limited liabilty company (the "Seller") and PacifiCorp, an
Oregon corporation acting in its merchant fuction capacity ("PacifiCorp"). Seller ànd
PacifiCorp are referred to collectively as the "Parties" and individually as a "Part".
RECITALS
A. Seller intends to constrct, own, operate and maintain a wind facilty, including
Seller's Interconnection Facilities, for the generation of electrc power located in Bingham,
County with an expected Facility Capacity Rating of 27,600-kilowatts (kW) as furter described
in Exhibit A and Exhibit B ("Facilty").
B. Seller has secured rights to deliver output. from its Facilty to PacifiCorp across
interconnection facilities shared by five Qualifyng Facilities (Coyote Hil, Five Pine, Steep
Ridge, North Point, and Rattlesnake Canyon); the five Qualifyg Facilities have agreed to
allocate comingled line losses on those interconnection facilities as set forthin Addendum L.
C. Seller intends to operate the Facility as a Qualifyng Facilty, as such term is
defined in Section 1.55 below, and to sell Net Output to PacifiCorp in Idaho.
D. Seller estimates that the average anual Net Output to be delivered by the Facilty
to PacifiCorp is 73,115,137 kilowatt-hours (kWh) ("Average Annual Net Output") pursuant to
the Initial Year Energy Delivery Schedule in Section 4.3.1, which amount of energy PacifiCorp
wil include in its resoUIce planing.
E. Seller intends to sell and PacifiCorp intends to purchase all the Net Output from
the Facility in accordance with the terms and conditions of ths Agreement.
F. PacifiCorp intends to designate Seller's Facility as a Network Resource for the
puroses of servng Network Load.
. G. Ths Agreement is a "New QF Contract" under the PacifiCorp Inter-Jursdictonal
Cost Allocation Revised Protocol.
H. Seller 1R has LJ has not authorized Transmission Provider to release generation
data to PacifiCorp. If yes, the authorization is attached as Exhibit H.
NOW, THEREFORE, the Paries mutually agree as follows:
SECTION 1: DEFINITIONS
When used in this Agreement, the following terms shall have the following meanngs:
1.1 "As-built Supplement" shall be a supplement to Exhibit A, provided by Seller
following completion of constrction of the Facilty, accurately describing the completed
Facilty.
1
Cedar Creek Wind, LLC-Rattlesnake Canyon
1.2 "Availabilty" means, for any Biling Period, the ratio, expressed as a
percentage, of (x) the aggregate sum of the tubine-minutes in which each of the Wind
Turbines at the Facilty was available to generate at the Maximum Facility Delivery Rate
during the Biling Period over (y) the product of the number of Wind Turbines that comprise
the Facilty Capacity Rating as of Commercial Operation multiplied by the number of minutes
in such Biling Period. 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
Facilty Delivery Rate to the Point of Delivery; unless if unavailable due solely to (i) a default
by PacifiCorp; (ii) to the extent not caused by Seller's actions, a curailment in accordance
with Section 6.3 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 "Billng Period" means the time period between PacifiCorp's reading of its
power purchase meter at the Facilty and for this Agreement shall coincide with calendar
months.
1.4 "Commercial Operation" means that not less than the 90 % of the expected
Facility Capacity Rating is fuly operational and reliable and the Facility is fuly
interconnected, fully integrated, and synchronied with the System, all of which shall be
Seller's responsibilty 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:
1.4.1 PacifiCorp has received a certificate addressed to PacifiCorp from a
Licensed Professional Engineer (a) stating the Facilty Capacity Rating of the Facilty
at the anticipated time of Commercial Operation and (b) stating that the Facility is able
to generate electric power reliabÍy in amounts required by this Agreement and in
accordance with all other terms and conditions of this Agreement.
1.4.2 Start-Up Testing of the Facilty has been completed in accordance with
Exhibit E.
1.4.3 PacifiCorp has received a certificate addressed to PacifiCorp from a
Licensed Professional Engineer, an attorney in good stading 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 Facilty is physically interconnected
with the System in conformance with the Generation Interconnection Agreement and
able to deliver energy consistent with the terms of this Agreement, and the Facilty is
fuly 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
2
Cedar Creek Wind, LLC-Rattlesnake Canyon
writing, Seller shall have provided copies of any or all such requested Required
Facilty Documents.
1.4.5 Seller has complied with the security requirements of Section 11.
1.4.6 Network Resource Designation and Transmission Service Request. (i)
PacifiCorp has received c.onfirmation from the Transmission Provider that the Facilty
has been designated as a Network Resource and (ii) PacifiCorp has received
confirmation from the Transmission Provider that the transmission service request has
been granted in suffcient capacity to meet or exceed the Maximum Facilty Delivery
Rate and the Seller has paid all costs associated with any requirements of the
transmission service request.
1.5 "Commercial Operation Date" means the date, as designated by PacifiCorp
pursuat to Section 2.4, the Facilty first achieves Commercial Operation.
1.6 "Commission" mean the Idaho Public Utilties Commission.
1.7 "Conforming Energy" means all Net Energy except Non-Conformig Energy.
1.8 "Conformng Energy Purchase Price" mean the applicable price for
Conforming Energy and capacity, specified in Section 5.1.
1.9 "Contract Year" means a twelve (12) month period commencing at 00:00
hours Pacific Prevailing Time ("PPT") on Janua 1 and ending on 24:00 hours PPT 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 shal end on the Expiration Date, unless earlier terminated as provided herein.
1.10 "Cut-in Wind Speed" means the wind speed at which a stationary wind turbine
begins producing Net Energy, as specified by the tubine manufactuer and set fort in
Exhbit A.
1.11 "Delay Liquidated Damages", "Delay Daily Minimum", "Delay Period",
"Delay Price" and "Delay Volume~~ shall have the meangs set forth in Section 2.5 of this
Agreement. "Delay Security" shall have the meanng set fort in Section 11.1.1 of this
Agreement.
1.12 "Default Security" shall have the meaning set fort in Section 11.2 of this
Agreement.
1.13 "Effective Date" shall have the meaning set forth II Section 2.1 of this
Agreement.
1.14 "Energy Delivery Schedule" shall have the meaning set fort in Section 4.3 of
this Agreement.
3
Cedar Creek Wind, LLC-Rattlesnake Canyon
1.15 "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 (C02), methane (CH4), and other
greenhouse gases (GHGs) that have been determined by the United Nations Intergovernental
Panel on Climate Change to contribute to the actual or potential theat of altering the Eart' 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 futue associated
with the construction, ownership or operation of the Facility, (ii) matters designated by
PacifiCorp as sources of liabilty, or (iii) adverse wildlife or environmental impacts.
1.16 "Environmenta Contamination" means the introduction or presence of
Hazrdous Materials at such levels, quantities or location, or of such form or character, as to
constitute a violation of federal, state or 10ca11aws or regulations, and present a material risk
under federal, state or local laws and regulations that the Premises wil not be available or
usable for the purposes contemplated by this Agreement.
1.17 "Expiration Date" shall have the meanig set fort in Section 2.1 of this
Agreement.
1.18 "Facilty" is defied in Recital A of ths Agreement.
1.19 "Facilty Capacity Rating" means the sum of the Nameplate Capacity Ratings
for all generators comprising the Facilty.
1.20 "Force Majeure" has the meaning set fort in Section 15.1.
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 Planed Outages are not Forced Outages.
1.22 "Generation Interconnection Agreement" meas the generation
interconnection agreement entered into 'separate1y between Seller and Transmission Provider,
as applicable, specifying the Point of Delivery and providing for the construction and
operation of the Interconnection Facilties.
1.23 "Governmental Authority" means any suprantional, federal, state or other
political subdivision thereof, having jurisdiction over Seller, PacifiCorp or this Agreement,
including any muncipality, township or county, and any entity or body exercising executive,
legislative, judicial, regulatory or adminstrative functions of or pertining to government,
including any corporation or other entity owned or controlled by any of the foregoing.
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Cedar Creek Wind, LLC-Rattlesnake Canyon
1.24 "Hazardous Matenals" means any waste or other substance that is listed,
defined, designated or classified as or determined to be hazardous under or pursuant to any
environmental law or reguation.
1.25, "Inadvertent Energy" mean: (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 Facilty Delivery Rate on an hour-averaged basis.
Inadvertent Energy is not included in Net Energy.
1.26 "Index Price", for each day, shall mean the weighted average of the average
Peak and Off-Peak firm energy market prices, as published in the Intercontinental Exchange
(ICE) Day Ahead Power Price Report for the Palo Verde Hub. For Sunday and NERC
holidays, the 24-Hour Index Price shall be used, unless ICE shall publish a Firm On-Peak and
Firm Off-Peak Price for such days for Palo Verde, in which event such indices shall be
utilized for such days. If the ICE 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 withold, condition or delay.
1.27 "Initial Year Energy Delivery Schedule" shall have the meanng setforth in
Section 4.3.1.
1.28 "Interconnection Facilties" means all the facilities and ancilar equipment
used to interconnect the Facility to the System, as defined in the Generation Interconnection
Agreement.
1.29 "Letter of Credit" means an irrevocable standby letter of credit in a form
reasonably acceptable to PacifiCorp, nag PacifiCorp as the party entitled to demand
payment and present draw requests thereunder. Such letter of credit shall be provided by an
institution tht is a United States offce of a commercial bank or trust company organized
under the laws of the United States of America or a political subdivision thereof, with a credit
rating on its long-term senior unsecured debt of at least "A" from Standard & Poor's and
"A2" from Moody's Investor Services, and (unless otherwise agreed) having assets of at least
$10,000,000,000 (net of reserves).
1.30 "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
trainig 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 Facilty, or of a manufacturer or supplier of any equipment installed in the Facilty. 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 opinons required by
5
Cedar Creek Wind, LLC-Rattlesnake Canyon
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.
1.31 "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 Planed Outage. A Maintenance Outage may occur any
time during the year and must have a flexible start date.
1.32 "Material Adverse Change" shall mean, with respect to the Seller, if the
Seller has experienced a change in facts or circumstances related to development or operation
of the Facilty that materially and adversely impact Seiler's abilty to fulfill its obligations
under this Agreement.
1.33 "Maxmum Facility Delivery Rate" means the maximum instantaneous rate
(lW) at which the Facilty is capable of delivering Net Output at the Point of Delivery, as
specified in Exhibit A, and in compliance with the Generation Interconnection Agreement.
1.34 "Maxmum GIA Delivery Rate" means the maximum rate (kW) at which the
Generator Interconnection Agreement allows the Facilty to deliver energy to the Point of
Delivery and is set forth in Exhibit A.
1.35 "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 Commssion Order No. 29632, the Maximum Monthly Purchase Obligation
for a given month, in kWh, shall equa11O,OOO kW multiplied by the total number of hours in
that month and prorated for any parial month; provided however that, subsequent to the
Effective Date of ths Agreement, any change by the Commssion to the Maximum Monthly
Purchase Obligation established by Order No. 29632 shall have no affect on the obligations of
the Parties pursuant to this Agreement.
1.36 "Nameplate Capacity Rating" means the maximum intantaneous generating
capacity of any qualifying small power or cogeneration generating unit supplying all or par of
the energy sold by the Facilty, expressed in MW or kW, when operated consistent with the
manufactuer's recommended power factor and operating parameters, as set fort in a notice
from Seller to PacifiCorp delivered before the Commercial Operation Date and, if applicable,
updated in the As-built Supplement.
1.37 "NERC" mean the Nort American Electric Reliabilty Corporation.
1.38 "Net Energy" mean the energy component, in kWh, of Net Output. Net
Energy does not include Inadvertent Energy.
1.39 "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
6
Cedar Creek Wind, LLC-Rattlesnake Canyon
purposes of calculating payment under ths Agreement, Net Output of energy shall be
calculated as set forth in Addendum L. Net Output does not include Inadvertent Energy.
1.40 "Network Resource" shall have the meang set forth in the Tariff.
1.41 "Network Service Provider" means PacifiCorp Transmission, as a provider of
network service to PacifiCorp under the Tariff.
1.42 "Non-Conforming Energy" means Net Ç)utput produced by the Facility prior
to the Commercial Operation Date.
1.43 "Non-Conforming Energy Purchase Price" means the applicable price for
Non-Conforming Energy and capacity, specified in Section 5.1.
1.44 "Off-Pea Hours" means all hours of the week that are not On-Peak Hours.
1.45 "On-Pea Hours" means hours from 6:00 a.m. to 10:00 p.m. Pacific
Prevailing Time, Monday though Saturday, excluding Western Electricity Coordinating
Council (WECC) and Nort American Electric Reliabilty Corporation (NERC) holidays.
1.46 "Output Shortfall" and "Output Shortfall Damges" shall have the meangs
set fort in Section 4.5 of this Agreement.
1.47 "PacifiCorp" is defied in the first paragraph of this Agreement, and excludes
PacifiCorp Transmission.
1.48 "PacifiCorp Transmission" means PacifiCorp, an Oregon corporation, acting
in its interconnection and transmission fuction capacity.
1.49 "Planned Outage" means an outage of predetermined duration that is scheduled
in Seller's Energy Delivery Schedule. Boiler overhauls, turbine overhauls or inspections are
tyical planned outages. Maintenace Outages and Forced Outages are not Planed Outages.
1.50 "Point of Delivery" means the point of interconnection between the Facility
and the System, as specified in the Generation Interconnection Agreement and in Exhibit B.
1.51 "Premises" means the real propert on which the Facilty is or wil be located,
as more fuly described on Exhibit A.
1.52 "Prime Rate" means the rate per anum equal to the publicly anounced prime
rate or reference rate for commercial loan 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 bilion or more in assets in New
York City, N. Y., selected by the Part to whom interest based on the prime rate is being paid.
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Cedar Creek Wind, LLC-Rattlesnake Canyon
1.53 "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 Facilty is eligible. Production Tax Credits do not include any ta credit determined by
reference to investment.
1.54 "Prudent Electrical Practices" means any of the practices, methods and acts
engaged in or approved by a significant portion of the electrical utilty 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 reliabilty, safety and expedition.
Prudent 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 spectru of possible practices, methods or
acts.
1.55 "QF" means "Qualifying Facility", as that term is defied in the version of
FERC Regulations (codified at 18 CFR Part 292) in effect on the date of ths Agreement.
1.56 "Required Facilty Documents" means all deeds, titles, leases (including Wind
Leases), licenses, permits, authorizations, and agreements demonstrating that seller controls
the necessary propert rights and government authorizations to construct, operate, and
maintain the Facilty, including without limitation those set fort in Exhibit C.
1.57 "Requirements of Law" mean any applicable and mandatory (but not merely
advisory) federal, state and local law, statute, reguation, rule, code or ordinance enacted,
adopted, issued or promulgated by any federal, state, local or other Governental Authority
or regulatory body (including those pertaining to electrical, building, zonig, environmental
and occupational safety and health requirements).
1.58 "Scheduled Commercial Operation Date" mean the date by which Seller
promises to achieve Commercial Operation, as specified in Section 2.2.7.
1.59 "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.
1.60 "Shared Interconnection Facilties" means that portion of the Interconnection
Facilties used by the Facilty and one or more other Qualifying Facilties.
1.61 "Seller's Forecast-Cost Share" and "Seller's Capped Forecast-Cost Share"
shall have the meangs set forth in Sections 8.2 and 8.3 respectively.
1.62 "Subsequent Energy Delivery Schedule" shall have the meaning set forth in
Section 4.3.3.
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Cedar Creek Wind, LLC-Rattlesnake Canyon
1.63 "System" means the electric transmission substation and transmission or
distribution facilties owned, operated or maintained by Tranmission Provider, which shall
include, after construction and installation of the Facilty, the circuit reinforcements,
extensions, and associated terminal facilty reinorcements or additions required to
interconnect the Facilty, all as set fort in the Generation Interconnection Agreement.
1.64 "Tariff" means the PacifiCorp Transmission FERC Electric Tariff Seventh
Revised Volume No.11 Pro Forma Open Access Tranmission Tariff or the Transmission
Provider's corresponding FERC tariff or both, as revised from time to time.
1.65 "Transmission Provider" meaS PacifiCorp Tranmission or a successor,
including any regiona transmission organization ("RTO").
1.66 "Wind Leases" means the memoranda of wind lease and redacted wind leases
recorded in the county in which the Facilty is located in connection with the development of
the Facilty, as~the same may be supplemented, amended, extended, restated, or replaced from
time to time.
1.67 "Wind Turbine" means a type SWT-2.3-101 Siemens 2,300 kilowatt wind
turbine. At its full Facilty Capacity Rating, the Facilty wil consist of 12 Wind Turbines.
SECTION 2: TERM, COMMERCIAL OPERATION DATE
2.1 This Agreement shall become effective after execution by both Parties and after
approval by the Commission ("Effective Date"); provided, however, ths Agreement shall not
become effective until the Commission has determined, pursuat to a final and non-appealable
order, that the prices to be paid for energy and capacity are just and reasonable, in the public
interest, and that the costs incurred by PacifiCorp for purchases of capacity and energy from
Seller are legitimate expenses, all of which the Commission wil allow PacifiCorp to recover
in rates in Idaho in the event other jurisdictions deny recovery of their proportionate share of
said expenses.
Unless earlier terinated as provided herein, the Agreement shall remain in effect unti
24:00 PPT September 30,2032 ("Expiration Date").
2.2 Time is of the essence of this Agreement, and Seller's abilty to meet certin
requirements prior to the Commercial Operation Date and to achieve Commercial Operation
by the Scheduled Commercial Operation Date is critically important. Therefore,
2.2.1 By September 30, 2011, Seller shall obtain and provide to PacifiCorp
copies of all governmental permits and authorizations listed in Exhibit C.
2.2.2 By the date 30 calendar days after the Effective Date, Seller shall
provide Delay Security required under Section 11.1.1, as applicable.
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Cedar Creek Wind, LLe-Rattlesnake Canyon
2.2.3 By June 30, 2011, Seller: (i) has provided all information and paid all
fees the Transmission Provider requires to designate the Facilty as a Network
Resource in accordance with the Tariff (OATT); and (ii) has provided all information
reasonably required by PacifiCorp to submit a transmission service request for the
Facilty to the Transmission Provider pursuant to the Tariff.
2.2.4 At least ten business days prior to delivery of any energy from the
Facilty to PacifiCorp, Seller shall provide PacifiCorp with an executed Generation
Interconnection Agreement.
2.2.5 Prior to Commercial Operation Date, Seller shall provide Default
Security required under Section 11.2, as applicable.
2.2.6 Prior to Commercial Operation Date, Seller shall provide PacifiCorp
with an As-built Supplement reasonably acceptable to PacifiCorp.
2.2.7 By 00:00 PPT October 1, 2012, Seller shall achieve Commercial
Operation ("Scheduled Commercial Operation Date").
2.3 Begining October 1, 2011, Seller shal provide PacifiCorp a one-page monthy
update bye-mail on the progress of the milestones in Section 2.2.
2.4 Establishing Commercial Operation. Seller shall provide written notice to
PacifiCorp stating when Seller believes that the Facilty has achieved Commercial Operation.
PacifiCorp shall have ten (10) business days after receipt either to confrm 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 (10)
business day period, PacifiCorp either does not respond or else confirms that the Facility has
achieved Commercial Operation, the original date of receipt of Seller's notice shall be the
Commercial Operation Date. If PacifiCorp notifies Seller within such ten (10) business day
period that PacifiCorp reasonably believes the Facilty has not achieved Commercial
Operation, Seller may, if it has a good faith belief that Commercial Operation has been
achieved, submit a Technical Dispute Notice, or else Seller shall address the concerns stated in
PacifiCorp's notice to the mutual satisfaction of both Parties. If Seller submits a Technical
Dispute Notice and the Techncal Expert determes that Commercial Operation has been
achieved, then the Commercial Operation. Date shall be the date, as determed by the
Technical Expert, that the Facilty first met all the requirements of Commercial Operation;
otherwise the date upon which Seller has addressed the concern stated in PacifiCorp's notice
to PacifiCorp's reasonable satisfaction, as specified in a notice from PacifiCorp to Seller, shall
be the Commercial Operation Date. If Commercial Operation is achieved at less than one
hundred percent (100%) of the expected Facilty Capacity Rating and Seller inorms
PacifiCorp that Seller intends to bring the Facilty to one hundred percent (100%) of the
expected Facilty Capacity Rating, Seller shall provide PacifiCorp with a list of all items to be
completed in order to achieve the expected Facilty Capacity Rating.
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Cedar Creek Wind, LLG-Rattlesnake Canyon
2.4.1 Technical Expert. If, and only if, a dispute regards (i) whether or not
Commercial Operation has been achieved, and/or (ii) the date when Commercial
Operation was achieved, the Parties may have such dispute, and only such dispute,
resolved pursuat to this Section 2.4.1. Any such dispute wil be determned by an
independent technical expert, who shall be a mutully acceptable third party with
training and experience in the disciplines relevant to the matters with respect to which
such person is called upon to provide a certification, evaluation or opinion (the
"Technical Expert"), which determination shall be (X) made (subject to the terms in
this Section 2.4) in accordance with the Construction Industry Arbitration Rules and
Mediation Procedures (Including Procedures for Large, Complex Construction
Disputes) of the AAA, as amended and effective on October 1, 2009 (the "Technical
Dispute Procedures"), notwithstanding any dollar amounts or dollar limitations
contained therein, and (Y) binding upon the Parties.
(a) Either Par may commence the dispute process as to the matters
set forth in paragraph 2.4.1, a1Jove, with the Amercan Arbitration Association
("AA") by notifying AAA and the other Pary in wrting ("Technical Dispute
Notice") of such Pary's desire that the dispute be resolved through a
determination by a Technical Expert.
(b) The deterination shall be conducted by a sole Technical Exper.
The Paries may select any mutually acceptable Techncal Expert. If the Pares
canot agree on a Technical Expert within five (5) days after the date of the
Technical Dispute Notice, then the AA's Arbitration Administrator shall send a
list and resumes of thee (3) available technical expers meeting the qualifications
set forth in Section 2.4.1 to the Paries, each of whom shall strke one name, and
the remaining person shall be appointed as the Techncal Expert. If more than
one name remains, either because one or both Paries have failed to respond to the
AAA's Arbitration Administrator withn five (5) days after receiving the list or
because one or both Paries have failed to strke a name from the list or because
both Paries strke the same name, the AAA's Arbitration Administrator will
choose the Techncal Exper from the remaining names. If the designated
Techncal Expert shall die, become incapable or, unwiling to, or unable to sere
or proceed with the deterination, a substitute Techncal Expert shall be
appointed in accordance with the selection procedure descrbed above, and such
substitute Technical Expert shall have all such powers as if he or she has been
originally appointed herein.
(c) Within thirty (30) days of the appointment of the Techncal Exper
pursuant to the foregoing sub-section, each Party shall submit to the Technical
Expert (and copy the other Pary) a wrtten report containig its position with
respect to the dispute, and arguents therefor together with supporting
documentation and calculations. Discovery shall be limited to Facility documen-
tation relating to the disputed matter. Within sixty (60) days from receipt of such
submissions, the Technical Expert shall select one or the other Part's position
with respect to the disputed, arbitrate-able issues set forth in paragraph 2.4.1
above, whereupon such selection shall be a binding determnation upon the
11
Cedar Creek Wind, UC-Rattlesnake Canyon
Paries for all purposes hereof. The costs of the Technical Exper, including his or
her fees and expenses, shall be borne by the Pary whose position was not selected
by the Technical Expert; each Party shall otherise bear its own expenses. ifthe
Techncal Expert fails to render a decision within niety (90) days from receipt of
each Pary's submissions, either Pary may, prior to the Techncal Exper's final
decision, initiate litigation, in which case the Technical Expert's final decision
shall not be binding on the Paries uness otherwise agreed.
2.4.2 All verbal and written communications between the Paries and issued or
prepared in connection with this Section 2.4.1 shall be deemed prepared and
communcated in furterance, and in the context, of dispute settlement, and shall be
exempt from discovery and production, and shall not be admissible in evidence
(whether as admission or otherwise) in any litigation or other proceedings for the
resolution of the dispute. i
2.4.3 All deadlines specified in this Section 2.4 may be extended by mutual
agreement of the Parties.
2.5 Delay Damages. Seller shall cause the Facilty 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, until the earlier of
occurrence of the Commercial Operation Date or the termination of this Agreement ("Delay
Liquidated Damages"), provided that Seller shall not accrue any Delay Liquidate Damages
after: (i) Seller has timely achieved the milestone in Section 2.2.3; and (ii) Seller has satisfied
all requirements of Commercial Operation except for one or more requirements in Section
1.4.6. Bilings and payments for Delay Liquidated Damages shall be made in accordance with
Section 11.1.
2.5.1 Delay Liquidated Damages. Delay Liquidated Damages equals the sum
of: for each day in the Delay Period, the greater of (1) the Delay Daily Minmum or
(2) the Delay Price times the Delay Volume
Where:
"Delay Daily Minimum" equals (a) for the first fort-five (45) calendar days
following the Scheduled Commercial Operation Date: one-ninetieth (l/90th) of
forty-five dollars ($45) multiplied by the Maximum Facility Delivery Rate with
the Maximum Facility Delivery Rate being measured in kW; (b) after the forty-
fift (45th) calendar day following the Scheduled Commercial Operation date: the
Delay Price times the Delay Volume.
"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
12
Cedar Creek Wind, UC-Rattlesnake Canyon
"Delay Volume" equals the applicable Scheduled Monthy Energy Deliver
divided by the number of days in that month.
2.5.2 Appropriateness of Damages. The Parties agree that the damages
PacifiCorp would incur due to delay in the Facilty achieving Commercial Operation on
or before the Scheduled Commercial Operation Date would be diffcult or impossible to
predict with certainty , and that the Delay Liquidated Damages are an appropriate
approximation of such damages.
SECTION 3: REPRESENTATIONS AND WARRNTIES
3.1 PacifiCorp represents, covenants, and warrants to Seller that:
3.1.1 PacifiCorp is duly organzed and validly existing under the laws of the
State of Oregon.
3.1.2 PacifiCorp has the requisite corporate power and authority to enter into
this Agreement and to perform according to the terms of this Agreement.
3.1.3 PacifiCorp has taken all corporate actions required to be taken by it to
authorize the execution, delivery and performance of this Agreement and the
consumation of the transactions contemplated hereby.
3.1.4 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 reguatory agency or other body having authority to which
PacifiCorp is subject.
3.1.5 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 enforceabilty of this Agreement may be limted by bankptcy,
insolvency, bank moratorium or similar laws affecting creditors' rights generally and
laws restricting the availability of equitable remedies and except as the enforceabilty of
this Agreement may be subject to general principles of equity, whether or not such
enforceabilty is considered in a proceeding at equity or in law).
3.2 Seller represents, covenants, and warrants to PacifiCorp that:
3.2.1 Seller is a limited liabilty company duly organed and validly existing
under the laws of Delaware.
3.2.2 Seller has the requisite power and authority to enter into this Agreement
and has, or wil have at the date of Commercial Operation of the Facilty, all requisite
power and authority to perform according to the terms hereof, including all required
reguatOry authority to mae wholesale sales from the Facility.
13
Cedar Creek Wind, LLC-Rattlesnake Canyon
3.2.3 Seller's shareholders, directors, and offcers have taken all actions
required to authorize the execution, delivery and performance of this Agreement and
the consumation 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 indentue, 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.
3.2.5 This Agreement is a valid and legally binding obligation of Seller,
enforceable against Seller in accordance with its terms (except as the enforceabilty of
this Agreement may be limited by bankptcy, insolvency, ban moratorium or similar
laws affecting creditors' rights generally and laws restricting the availabilty of
equitable remedies and except as the enforceabilty 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).
3.2.6 The Facilty 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 Reguatory 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 Facilty is a QF and providing
sufficient proof (including copies of all documents and data as PacifiCorp may request)
demonstrating that Seller has maintained and wil continue to maintain the Facilty as a
QF.
3.2.7 Neither the Seller nor any of its principal equity owners is or has within
the past two (2) years been the debtor in any bankptcy proceeding, is unable to pay
its bils 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's
abilty to own and operate the Facilty in accordance with the terms of this Agreement.
3.2.8 Seller has not at any time defaulted in any of its payment obligations for
electricity purchased from PacifiCorp.
3.2.9 Seller is not in default under any of its other material agreements that
would result in Seller's failure to perform its material obligations hereunder.
3.2.10 Seller owns all right, title and interest in and to the Facilty, free and
clear of all liens and encumbrances other than liens and encumbrances related to thrd-
party financing of the Facility, and Seller (or its successor in interest) wil continue to
own for the term of this Agreement, all right, title and interest in and to the Facilty,
14
Cedar Creek Wind, LLC-Rattlesliake Canyon
free and clear of all liens and encumbrances other than liens and encumbrances related
to third-party financing of the Facility.
3.2.11 In entering into this Agreement and the undertakig by Seller of the
obligations set fort herein, Seller has investigated and determined that it is capable of
performing hereunder and has not relied upon the advice, experience or expertise of
PacifiCorp in connection with the tranactions contemplated by this Agreement.
3.2.12 All professionals or experts including, but not limited to, engineers,
attorneys or accountants, that Seller may have consulted or relied on in undertakg the
transactions contemplated by this Agreement have been solely those of Seller.;., ¡. "".~ . /1,,'
3.2.13 All leases of real property required for the operation of the Facilty or
the performance of any obligations of Seller hereunder are set fort and accurately
described in Exhibit C. Upon request by PacifiCorp, Seller shal provide copies of the
Wind Leases to PacifiCorp.
3.2.14 All information about the Facilty set fort in Exhibit A, Exhibit B, and
Exhibit C has been verified by Seller and is accurate to the best of its knowledge.
3.3 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 Part with written notice of the event or inormation, 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 pursuat
to this Section shall be given as soon as practicable after the occurrence of each such event.
SECTION 4: DELIVERY OF POWER; AVAILABILITY GUARTY
4.1 Delivery and Acceptance of Net Output. Except for any curtaiment specified
in Section 6.3, uness otherwise provided herein, PacifiCorp wil purchase and Seller wil sell
all Net Output from the Facilty.
4.2 No Sales to Third Parties. During the term of this Agreement, Seller shall not
sell any Net Output from the Facilty to any entity other than PacifiCorp.
4.3 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 Facilty
("Energy Delivery Schedule"), in accordance with the following:
4.3.1 During the first twelve full calendar month following the Commercial
Operation Date, Seller predicts that the Facilty wil produce and deliver the following
monthly amounts ("Initial Year Energy Delivery Schedule"):
15
Cedar Creek Wind, LLC-Rattlesnake Canyon
Month Energy Delivery (kWh)Avg.kW
Januar 6,285,415 8,448
Februar 5,669,415 8,437
March 6,236,024 8,382
April 5,700,174 7,917
May 5,553,040 7,464
June 5,796,677 8,051
July 5,716,795 7,684
Augut 6,333:199 8,512
September 6,112,516 8,490
October 6,163,807 8,285
November 6,753,219 9,379
December 6,794,856 9,133
TOTAL:73,115,137 8,346
4.3.2 Seller may revise the Initial Year Energy Delivery Schedule any time
prior to the Commercial Operation Date.
4.3.3 Beginnng at the end of the ninth full calendar month of operation, and at
the end of every third month thereafter, Seller shall supplement the Energy Delivery
Schedule with three additional ,months of forward estimates (which shall be appended to
this Agreement using the format specified in Exhibit D) ("Subsequent Energy
Delivery Schedule"), such that the Energy Delivery Schedule wil provide at least
thee months of scheduled energy estimates at all times. Seller shall provide
Subsequent Energy Delivery Schedules no later than 5 :00 pm PPT 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 thee-month period during the previous year.
4.3.4 Upon and after the Commercial Operation Date, Seller may no longer
revise the Energy Delivery Schedule for the first six ful calendar months of
Commercial Operation. After 5:00 p.m. PPT of the fifth business day following the
end of the third full calendar month of Commercial Operation and the end of each third
calendar month thereafter, Seller may no longer revise the Energy Delivery Schedule
for the six calendar months immediately following such third month. Subject to the
foregoing restrictions in ths Section 4.3.4, Seller may revise the Energy Delivery
Schedule for any unestricted month by providing written notice to PacifiCorp. Failure
to provide timely written notice of changed amounts wil be deemed to be an election
of no change.
16
Cedar Creek Wind, LLC-Rattlesnake Canyon
4.4 Minimum Availabilty Obligation. Seller shall cause the Facilty to achieve an
Availabilty of at least 85% during each month ("Guaranteed Availabilty").
4.5 Liquidated Damages for Output Shortfall. If the Availabilty in any given
month falls below the Guaranteed Availabilty, 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 Availabilty - Availabilty) *
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
Conforming Energy Purchase Prices; or (2) the weighted average of the On-Peak and Off-
Peak monthly Conformg Energy Purchase Prices ("Output Shortfall Damages").
Output Shortfall Damages = Output Shortfall * Output Shortfall Price
Where:
(Index Price - Weighted Average CEPP), except
that if Output Shortfall Price oe 0, then Output
Shortfall Price = 0, and except that if Output
Shortall Price ). W eighted Average CEPP, then
Output Shortfall Price = Weighted Average CEPP
Weighted Average CEPP = the weighted average On-Peak and, Off-Peak
Conforming Energy Puchase Prices for the month
of Output Shortfall
Output Shortfall Price =
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 Facilty's failure to achieve the Guaranteed Availability would be diffcult or
impossible to predict with certinty, and (b) the liquidated damages contemplated in this
Section 4.5 are a fair and reasonable calculation of such damages.
4.6 Audit Rights. In addition to data provided under Sections 9.3 and 9.4,
PacifiCorp shall have the right, but not the obligation, to audit the Facilty's compliance with
its Guaranteed Availabilty 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
5.1 Energy Purchase Price. Except as provided in Section 5.3, PacifiCorp wil pay
Seller Conforming Energy or Non-Conforming Energy Purchase Prices for Net Output
17
Cedar Creek Wind, LLC-Rattlesnake Canyon
adjusted for the month and On-Peak Hours or Off-Peak Hours and the wind integration cost
using the following formulae, in accordance with Commssion Order Nos. 30423, 31025, and
31021 :
Where:
ARce
ARnce
MPM
WIC
Conformig Energy Purchase Price = (ARce * MPM) - WIC
Non-Conformig Energy Purchase Price = (ARnce * MPM) - WIC
=Conforming Energy anual rate from Table 1, below, for the year
of the Net Output.
the lower of.
85% of the Conforming Energy anual rate from Table 1
below, for the year of Net Output
=
or
=
85% of average of the daily Index Price for each day of
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 occured durng On-Peak Hours or Off-Peak Hours.
$6.50/MWh, the wind integration cost prescribed in Commission
Order No. 31021.
=
Example calculations are provided in Exhibit G.
Table i: Conformig Energy Annual Rates (from Commission Order No. 31025)
Conforming Energy
Annual Rate (ARe)
Year S/MWh
2012 63.97
2013 67.51
2014 71.32
2015 75.40
2016 77.76
2017 80.07
2018 82.58
2019 85.05
2020 87.61
2021 90.63
2022 93.78
2023 97.05
2024 100.44
2025 103.98
2026 106.98
2027 110.07
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Cedar Creek Wind, LLC-Ratt/esnake Canyon
2028 113.26
2029 116.56
2030 119.95
2031 124.51
2032 128.50
Table 2: Monthly On,:Peak/Off-Peak Multipliers,
Month On-Peak Off-Peak
Hours Hours
Januai 103%94%
Februar 105%97%
March 95%80%
April 95%76%
May 92%63%
June 94%65%
July 121%92%
Augut 121%106%
September 109%99%
October 115%105%
November 110%96%
December 129%120%
5.2 Payment.
For each Billng Period in each Contract Year, PacifiCorp shall pay Seller as follows:
For delivery of Conforming Energy:
Payment - (CEnergYon_Pe * CEPPriceOnPea / 1000) +
(CEnergy Off-Pe * CEPPriceOf_Peak / 1000)
For deliver of Non-Conformng Energy:
Payment - (NCEnergyOnPe * NCEPPrIceOn_Pe / 1000) +
(NCEnergYoff_Pe * NCEPPriceOff_peak / 1000)
Where:
CEnergy =
CEPPrice =
NCEnergy =
NCEPPrice =
On-Peak =
Off-Peak =
Conformng Energy in kWh
Conforming Energy Purchase Price in $/M
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
5.3 Inadvertent Energy. So long as acceptance of Inadvertent Energy does not
cause PacifiCorp to violate the terms of its Network Transmission Service and is consistent
19
Cedar Creek Wind, LLC-Rattlesnake Canyon
with Prudent Electrical Practices, PacifiCorp wil accept Inadvertent Energy, but wil not
purchase or pay for Inadvertent Energy.
SECTION 6: OPERATION AND CONTROL
6.1 As-Built Supplement. Upon completion of any construction affecting the
Facility, Seller shall provide PacifiCorp an As-built Supplement bearing the stamp of a
Licensed Professional Engineer that accurately depicts the Facilty as built. The As-built
Supplement must be reviewed and approved by PacifiCorp, which approval shall not
unreasonably be witheld, conditioned or delayed.
6.2 Operation. Seller shall operate and maintain the Facilty 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 Facilty to the extent the
interconnection between the Facilty and PacifiCorp's electric system is disconnected,
suspended or interrpted, in 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
inpect the Facilty 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 Facilty, or by any action or inction taken with respect to any
such inspection, assume or be held responsible for any liabilty or occurrence arising from the
operation and maintenace by Seller of the Facility.
6.3 Curtailment. PacifiCorp shall not be obligated to purchase, receive, pay for, or
pay any damages associated with, Net Output (or associated Production Tax Credits or
Environmental Attributes) if such Net Output (or associated Production Tax Credits or
Environmental Attributes) is not delivered to the System or Point of Delivery due to any of the
following: (a) the interconnection between the Facilty and the System is disconnected,
suspended or interrupted, in whole or in part, consistent with the terms of the Generation
Interconnection Agreement, (b) the Transmission Provider or Network Service Provider
directs a general curailment, reduction, or redispatch of generation in the area, (which would
include the Net Output) for any reason, even if such curtailment or redispatch directive is
carried out by PacifiCorp, which may fu1fù1 such directive by acting in its sole discretion; or if
PacifiCorp curtails or otherwise reduces the Net Output in order to meet its obligations to the
Transmission Provider or Network Service Provider to operate within system limitations, (c)
the Facilty'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. Seller shall reasonably determine the MWh amount of Net Output
curtailed pursuant to this Section 6.3 after the fact based on the amount of energy that could
have been generated at the Facilty 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
20
Cedar Creek Wind, LLe-Rattlesnake Canyon
curtailed energy based on (x) the time and duration of the curtailment period and (y) wind
conditions recorded at the Facilty during the period of curtailment and the power curve
specified for the for the Wind Turbines as shown 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 energy that was not generated or delivered
because of a curtailment described in this Section 6.3.
6.4 PacifiCoro as Merchant. Seller acknowledges that PacifiCorp, acting in its
merchant capacity function as purchaser under this Agreement, has no responsibilty for or
control over PacifiCorp Transmission or any successor Transmission Provider.
6.5 Outages.
6.5.1 Planned Outages. Except as otherwise provided herein, Seller shall not
schedule Planed Outage during any portion of the months of November, December,
January, Februry, June, July, and August, except to the extent a Planed Outage is
reasonably required to enable à 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 Planed 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 fift (150) hours
of Planned Outages for each calendar year. Seller shall notify PacifiCorp of any
deviation to the anual Planed Outage schedule, above, on the Monday preceding the
scheduling week in which the sooner of the following wil occur: (a) the outage as
predicted in the Planned Outage schedule; or (b) the outage per Seller's revised plans.
Such notice shall consist of a Monday-Sunday, hourly spreadsheet showing the revised
total Facility curtailment (MW) for that scheduling week. Seller shall not schedule any
maintenance of Shared Interconnection Facilities during November, December,
January, February, June, July, or August, without the prior written approval of
PacifiCorp, which approval may be reasonably witheld by PacifiCorp.
6.5.2 Maintenace 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 begin (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
requirements of Seller and the service obligations of PacifiCorp. Seller shall tae all
reasonable measures and use commercially reasonable 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
21
Cedar Creek Wind, LLC-Rattlesnake Canyon
start date and time of the outage, the amount of generation capacity of the Facility that
wil not be available, and the expected completion date and time of the outage. Seller
may provide notices under this Section 6.5.2 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 miniize the frequency
and duration of Maintenace Outages.
6.5.3 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
Facilty. Such report shall include the amount of generation capacity of the Facilty
that wil 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 Facilty Capacity Rating of the Facilty being
unavailable, Seller shall confirm the oral report in writing as soon as practicable.
Seller shall tae all reasonable measures and exercise its best efforts consistent with
Prudent Electrical Practices to avoid Forced Outages and to minimie their duration.
6.5.4 Notice of Deratings and Outages. Without limiting other notice
requirements, Seller shall notify PacifiCorp, via telephone or via electronic mail, to a
number or email address specified by PacifiCorp, of any limtation, restriction,
derating or outage known to Seller that affects the generation capacity of the Facilty 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.
6.5.5 Effect of Outages on Estimated Output. Seller shall factor Planned
Outages and Maintenance Outages that Seller reasonably expects to encounter in the
ordina course of operating the Facilty into the Scheduled Monthly Energy Delivery
amounts in the Energy Delivery Schedule set fort in Exhibit D.
6.6 Scheduling.
6.6.1 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 Part shall designate authorized representatives
to communicate with regard to scheduling and related matters arising hereunder.
6.6.2 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
22
Cedar Creek Wind, LLC-Rattlesnake Canyon
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 R TO recognied standing (or shall contract with a third party
who has such RTO recognied 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 harmess against any liability
arising due to Seller's performance or failure to perform under the Generation
Interconnection Agreement or RTO requirement.
6,7 Delivery Exceeding the Maximum GIA Delivery Rate. Seller shall not deliver
energy from the Facility to the Point of Delivery at a rate that exceeds the Maxmum GIA
Delivery Rate. Seller's failure to limit such deliveries to the Maximum GIA Delivery Rate
shall be a breach of a material obligation subject to Section 12.1.8.
6.8 Access Rights. Upon reasonable prior notice and subject to the prudent safety
requirements of Seller, and Requirements of Law relating to workplace health and safety,
Seller shall provide PacifiCorp and its authorized agents, employees and inpectors
("PacifiCorp Representatives") with reasonable access to the Facilty: (a) for the purpose of
reading or testing metering equipment, (b) as necessary to witness any acceptance tests, (c) for
purposes of implementing Section 4.6, and (d) for other reasonable puroses at the reasonable
request of PacifiCorp. PacifiCorp shall release Seller againt and from any and all any and all
loss, fines, penalties, claims, actions or suits, including costs and attorney's fees, both at trial
and on appeal resulting from actions or omissions by any of the PacifiCorp Representatives in
connection with their access to the Facility, except to the extent that such damages are caused
or by the intentional or grossly negligent act or omission of Seller.
SECTION 7: MOTIVE FORCE
Prior to the execution of this Agreement, Seller provided to PacifiCorp Wind Leases and
a motive force plan including an hourly wind profile acceptable to PacifiCorp in its reasonable
discretion and attached hereto as Exhibit F-l, together with a cerfication from a Licensed
Professional Engineer to PacifiCorp attched hereto as Exhibit F-2, certifyng 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 necessar to deliver the Average Annual Net Output.
SECTION 8: GENERATION FORECASTING COSTS
8.1 Forecast Service Election. PacifCorp may, in its discretion, add forecasting
services for Seller's Facilty 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.
23
Cedar Creek Wind, LLC-Rattlesnake Canyon
8.2 Seller's Forecast-Cost Share. Pusuant to Commssion Order No. 30497, Seller
shall be responsible for 50% of PacifiCorp's cost of adding such forecasting services
("Seller's Forecast-Cost Share") up to Seller's Capped Forecast-Cost Share.
8.3 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 wil 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 1I11th of Seller's Forecast-Cost Share during each of the first 11 months.)
In the last month of each Contract Year, PacifiCorp shall refud 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: METERIG; REPORTS AN RECORDS
9.1 Metering Adjustment. Metering wil be performed at the location specified in
Exhibit B and in the manner specified in the Generator Interconnection Agreement. All
quantities of energy purchased hereunder shall be adjusted in accordance with Addendum L,
so tht the purchased amount reflects the net amount of power flowing into the System at the
Point of Delivery. i
9.2 Metering Errors. If any inpections or tests made pursuant to the Generator
Interconnection Agreement discloses 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 thee Biling Periods, in the amount the metering
equipment shall have been shown to be in error by such test. Any correction in billngs or
payments resulting from a correction in the meter records shall be made in the next monthly
biling or payment rendered.
1 If station service is supplied via separate facilities, PacifiCorp will deduct station servce from the metered facility
output to calculate Net Output.
24
Cedar Creek Wind, LLC-Rattlesnake Canyon
9.3 Te1emetering. In accordance with the Generation Interconnection Agreement,
Seller shall provide te1emetering equipment and facilties capable of tranmitting to
Transmission Provider (who wil share it with PacifiCorp as authorized by Exhibit H, "Seller
Authorization to Release Generation Data to PacifiCorp") the following information
concernng the Facilty on a real-time basis, and wil operate such equipment when requested
by PacifiCorp to indicate:
(a)
(b)
(c) the Facilty's total instantaneous generation capacity; and
(d) wind velocity at turbine hub height.
Seller shall also transmit to PacifiCorp any other data from the Facilty 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.g., if Seller receives the data in four second intervals, PacifiCorp shall also
receive the data in four second interals). PacifiCorp shall have the right from time to tie to
require Seller to provide additional te1emeterng equipment and facilities to the extent necessar
and reasonable.
instantaneous MW output at the Point of Deliver;
Net Output;
9.4 Monthly Reports and Logs and Other Information.
9.4.1 Reports. Within thirty (30) calendar days after the end of each Billng
Period, Seller shall provide to PacifiCorp a report in electronic format, which report
shall include (a) summaries of the Facilty's wind and output data for the Biling Period
in intervals not to exceed one hour (or such shorter period as is reasonably possible
with commercially available technology), including information from the Facilty's
computer monitoring system; (b) sumries of any other significant events related to
the construction or operation of the Facility for the Biling Period; (c) details of
Availabilty of the Facilty for the Biling Period sufficient to calculate Availabilty and
including hourly average wind velocity measured at tubine hub height and ambient air
temperatue; and (d) any supporting information that PacifiCorp may from time to time
reasonably request (including historical wind data for the Facilty).
9.4.2 Electronic Fault Log. Seller shall maintain an electronic fault log of
operations of the Facilty 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 thirt (30) calendar days after the end of the Biling Period to
which the fault log applies.
9.4.3 Upon the request of PacifiCorp, Seller shall provide PacifiCorp the
manufacturers' guidelines and recommendations for maintenace of the Facilty
equipment.
25
Cedar Creek Wind, LLC-Rattlesnake Canyon
9.4.4 By each January 10 following the Commercial Operation Date, Seller
shall provide to PacifiCorp written certification that Seller has completed all the
manufacturers' guidelines and recommendations for maintenance of the Facilty
equipment applicable to the previous calendar year.
9.4.5 At any time from the Effective Date, one (1) year's advance notice of
the termination or expiration of any agreement, including Wind Leases, pursuant to
which the Facility or any equipment relating thereto is upon the Facilty site; provided
that the foregoing does not authorize any early termination of any land lease.
9.4.6 As soon as it is known to Seller, Seller shall disclose to PacifiCorp, the
extent of any material violation of any environmental laws or regulations arising out of
the construction or operation of the Facilty, or the presence of Environmental
Contamnation at the Facilty or on the Premises, alleged to exist by any Governmenta
Authority having jurisdiction over the Premises, or the present existence of, or the
occurrence during Seller's occupancy of the Premises of, any enforcement, legal, or
regulatory action or proceeding relating to such alleged violation or alleged presence of
Environmental Contamition presently occurring or having occurred during the period
of time that Seller has occupied the Premises.
9.5 Maintenace of Metering Equipment. To the extent not otherwise provided in
the Generator Interconnection Agreement, PacifiCorp shall inspect, test, repair and replace the
metering equipment periodically, or at the request of Seller if Seller has reason to believe
metering may be off and requests an inspection in writing. To the extent not otherwise
provided in the Generator Interconnection Agreement, all PacifiCorp's costs relating to
designing, installing, maintainng, and repairing metering equipment installed to accommodate
Seller's Facilty shall be borne by Seller.
SECTION 10: BILLINGS, COMPUTATIONS AND PAYMENTS
10.1 Payment for Net Output. On or before the thirtieth (30th) day following the end
of each Biling 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 or the Generation Interconnection Agreement. Any such offsets shall be
separately itemized on the statement accompanying each payment to Seller.
10.2 Anual Invoicing for Output Shortfall. Thirt 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 Biling Periods in the prior Contract Year and
Output Shortall 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
26
Cedar Creek Wind, LLC-Rattlesnake Canyon
as practicable following its receipt of actual results for the relevant Contract Year. Seller shall
pay to PacifiCorp, by wire transfer of immediately available fuds 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 fort as due in such invoice, and shall within thirt (30) days after
receiving the invoice raise any objections regarding any disputed portion of the invoice.
Objections not made by Seller withn the thirty-day period shall be deemed waived.
10.3 Interest on Overdue Amounts. Any amounts owing after the due date thereof
shall bear interest at the Prime Rate on the date the amount became due, 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 Par, in good faith, disputes any amount due
pursuant to an invoice rendered hereunder, such Part shall notify the other Part of the
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. 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 Paries 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 10.3.
SECTION 11: SECURITY
11.1 Delay Security:
11.1.1 Duty to Post Security. By the date provided in Section 2.2.2, Seller
shall post a Letter of Credit, cash or a parental guaranty, each in a form acceptable to
PacifiCorp, in the amount of $1,429,585 as calculated pursuant to Section 11.1.2
("Delay Security"). To the extent PacifiCorp receives payment from the Delay
Security, Seller shall, within fifteen (15) calendar days, restore the Delay Security as if
no such deduction had occured.
11.1.2 Calculation of Delay Security. The dollar value of Delay Security shall
equal the greater of: (1) fort-five dollars ($45) multiplied by the Maximum Facilty
Delivery Rate with the Maximum Facilty Delivery Rate being measured in kW; or (2)
the sum of the products, for each of the first three calendar months after the Scheduled
Commercial Operation Date, of:
the energy in the Initial Year Energy Delivery Schedule for the month (kWh)
multiplied by the monthly weighted average On-Peak and Off-Peak Conforming
Energy Purchase Price for the months ($/MW) divided by 1000.
Such amount shall be fixed upon execution of this Agreement.
11.1.3 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
27
Cedar Creek Wind, LLC-Rattlesnake Canyon
first of each month, PacifiCorp wil invoice Seller for Delay Liquidated Damages
incurred, if any, during the preceding month. If insufficient Delay Security is
available, Seller shall pay PacifiCorp for invoiced Delay Liquidated Damages no later
than five business days after receiving such invoice. The Parties wil make bilings and
payments for Delay Liquidated Damages in accordance with Section 10.
11.1.4 Partial Release of Delay Security. Provided that Seller has maintained
Delay Security in accordance with Section 11.1.1, PacifiCorp shall release one-third of
the original amount of Delay Security stated in Section 11.1.1 each time Seller
accomplishes a milestone (a) or (b), below:
(a) Seller has (i) executed the Generation Interconnection Agreement
with Transmission Provider; and (ii) paid in full any interconnection and/or
system upgrade costs Seller is obligated to pay in advance of interconnection
construction.
(b) Seller has poured the concrete foundation at each of its planed
individual Wind Turbine locations.
PacifiCorp shall make the parial refund of Delay Security required above within ten
business days of the date Seller provides PacifiCorp wrtten notice (along with
satisfactory documentation thereof) that it has accomplished milestone (a) or (b).
11.1.5 Full Release of Delay Security. Unless PacifiCorp disputes whether
Seller has paid all Delay Liquidated Damages, PacifiCorp shall release all remaing
Delay Security upon the earlier of the 30th calendar day following commencement of
Commercial Operation or the 60t calendar day following PacifiCorp's termination of
ths Agreement.
11.1.6 Default. Seller's failure to post and maintain Delay Security in
accordance with Section 11.1 wil constitute an event of default, uness cured in
accordance with Section 12.1.1 of this Agreement.
11.2 Default Security (Leve1ized Pricing Only).
Reserved.
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 mae a payment when due under ths
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.
28
Cedar Creek Wind, LLC-Rattlesnake Canyon
12.1.2 Breach of Representation. Breach by a Party of a representation or
warranty set fort 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
the Generation Interconnection Agreement or any other agreement between the parties
related to this Agreement, the Generation Interconnection Agreement, or the Facilty
within the time allowed for a cure under such agreement or instruent.
12.1.4 Insolvency. A Party (a) makes an assignent for the benefit of its
creditors; (b) fies a petition or otherwise commences, authorizes or acquiesces in the
commencement of a proceeding or cause of action under any banptcy or similar law
for the protection of creditors, or has such a petition fied against it and such petition is
not withdrawn or dismissed within sixty (60) days after such filing; (c) becomes
insolvent; or (d) is unble 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 performnce assurances as are
reasonably requested by PacifiCorp, within thirt (30) days from the date of such
request.
12.1.6 Sale to Third-Pary. Seller's sale of Net Output to an entity other than
PacifiCorp, as prohibited by Section 4.2.
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 llonths.
12.1.8 A Part otherwise fails to perform any material obligation (including but
not limted to failure by Seller to meet any deadline set fort in Section 2.2.1 though
2.2.6) imposed upon that Party by this Agreement if the failure is not cured within
thirt (30) days after the non-defaulting Party gives the defaulting Party notice of the
default.
12.1.9 Seller fails to achieve the Commercial Online Date by the 91't day
following the Scheduled Commercial Online Date, provided, however, that, upon
written notice from the defaulting Part delivered prior to the 91'1 day of delay, ths
ninety (90) day period shall be extended by an additional one hundred and fifty (150)
days if (a) Seller has poured the concrete foundation at each of its planned individual
wind tubine locations; and (b) Seller replenishes Delay Default Security in accordance
with Section 11.1.1. Seller shall continue to accrue Delay Liquidated Damages in
accordance with Section 2.5 (Delay Price times the Delay Value) until the Project
achieves Commercial Operation or this Agreement is terminated.
12.2 In the event of any default hereunder, the non-defaulting Party must notify the
defaulting Pary in writing of the circumstances indicating the default and outlinig the
requirements to cure the default. If the default has not been cured within the prescribed time,
29
Cedar Creek Wind, LLC-Rattlesnake Canyon
above, the non-defaulting Part may termiate 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 ths Section
12 are cumulative such that the exercise of one or more rights shall not constitute a waiver of
any other rights.
12.3 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
fort in (Section 5), until the Expiration Date (as set fort 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, 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 withold payment), Seller shall pay
PacifiCorp Output Shortfall Damages for a period of eightefn (18) months from the date of
termination plus the estimated administrative cost to acquire the replacement power. The
Parties agree that the damages PacifiCorp would incur due to termination resulting from
Seller's default would be difficult or impossible to predict with certinty, and tht the damages
in this Section 12.4 are an appropriate approximation of such damages.
12.5 Recoupment of Damages.
(a) Default Securty Available. If Seller has posted Default Secunty,
PacifiCorp may draw upon that securty to satisfy any damages, above.
(b) Default Security Unavailable. If Seller has not posted Default Securty, or
if PacifiCorp has exhausted the Default Securty, .:acifiCorp may collect
any remaining amount owing by parally witholding futue payments to
Seller over a reasonable perod of time. PacifiCorp and Seller shall work
together in good faith to establish the period, and monthly amounts, of
such withholding so as to avoid Seller's default on its commercial or
financing agreements necessar for its continued operation of the Facility,
12.6 Upon an event of default or termition event resulting from default under this
Agreement, in addition to and not in limitation of any other right or remedy under ths
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 Part, 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 Part 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.
12.7 Amounts owed by Seller pursuant to this Section 12 shall be due within five (5)
business days after any irivoice from PacifiCorp for the same.
30
Cedar Creek Wind, LLC-Rattlesnake Canyon
SECTION 13: INDEMNIFICATION; LIABILITY
13.1 Indemnties.
13.1.1 Indemnty by Seller. Seller shall release, indemnfy and hold harmless
PacifiCorp, its directors, officers, agents, and representatives against and from any and
all loss, fines, penaltíes, 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 faciltíes on Seller's side of the Point of Delivery , (c) Seller's
operation and/or maintenance of the Facilty, or (d) arising from Seller's breach of ths
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 damge 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 Indemntv bv PacifiCoro. PacifiCorp shall release, indemnfy and hold
harmless Seller, its directors, officers, agents, lenders and representatives against and
from any and all loss, fines, penalties, claims, actíons 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, includig 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 propert, 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.
13.2 No Dedication. Nothng in this Agreement shall be construed to create any
duty to, any standard of care with reference to, or any liabilty to any person not a Par 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 utilty
corporation or Seller as an independent individual or entity.
13.3 No Warranty, Any review, acceptance or failure to review Seller's design,
specifications, equipment or facilties shall not be an endorsement or a confirmation by
PacifiCorp and PacifiCorp makes no warranties, expressed or implied, regarding any aspect of
Seller i s design, specifications, equipment or facilties, including, but not limited to, safety,
durability, reliabilty, strength, capacity, adequacy or economic feasibilty.
13.4 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
31
Cedar Creek Wind, LLC~Rattlesnake Canyon
FOR SPECIAL, PUNITIVE, INDIRECT, EXEMPLARY OR CONSEQUENTIAL
DAMAGES, WHETHER SUCH DAMAGES AR ALLOWED OR PROVIDED BY
CONTRACT, TORT (INCLUDING NEGLIGENCE), STRICT LIABILITY, STATUTE OR
OTHERWISE.
SECTION 14: INSURNCE
14.1 Certificates. Prior to connection of the Facilty to the System, Seller shall
secure and continuously carry insurance in compliance with the requirements of this Section.
Seller shall provide PacifiCorp insurance certificate(s) (of" ACORD Form" or the equivalent)
certifying Seller's compliance with the inurance requirements hereunder. Commercial
General Liabilty coverage written on a "claims-made" basis, if any, shall be specifically
identified on the certificate. If requested by PacifiCorp, a copy of each insurance policy,
certified as a true copy by an authorized representative of the issuing insurance company, shall
be furnished to PacifiCorp.
14.2 Required Policies and Coverages. Without limiting any liabilties or any other
obligations of Seller under this Agreement, Seller shall secure and continuously carry with an
insurance company or companies rated not lower than "A-:VII" by the A.M. Insurance
Reports the insurance coverage specified below:
14.2.1 Commercial General Liabilty inurance, to include contractual liability,
with a minimum single limit of $1,000,000 per occurrence to protect against and from
all loss by reason of injur to persons or damage to propert based upon and arising
out of the activity under this Agreement.
14.2.2 All Risk Propert inurance providing coverage in an amount at least
equal to 80 % of the rep1acemènt value of the Facilty against "all risks" of physical loss
or damage, including coverage for eart movement, flood, and boiler and machinery.
The Propert policy may contain separate sub-limits and deductib1es subject to
insurance company underwriting guidelines. The Risk Policy wil be maintained in
accordance with terms available in the insurance market for similar facilties.
14.3 The Commercial General Liabilty policy required herein shall include (i)
provisions or endorsements naming PacifiCorp, its Board of Directors, Officers and
employees as additional inureds, and (ii) cross liability coverage so that the insurance applies
separately to each inured against whom claim is made or suit is brought, even in instances
where one insured claims against or sues another insured.
14.4 All liabilty policies required by this Agreement shall include provisions that
such insurance is primary insurance with respect to the interests of PacifiCorp and that any
other insurance maintained by PacifiCorp is excess and not contributory insurance with the
insurance required hereunder, and provisions that such policies shall not be canceled or their
limits of liabilty reduced without (i) ten (10) business days prior written notice to PacifiCorp
32
Cedar Creek Wind, LLC-Rattlesnake Canyon
if canceled for nonpayment of premium, or (ii) thirty (30) business days prior written notice to
PacifiCorp if canceled for any other reason.
14.5 Commercial General Liabilty insurance coverage provided on a "claims-made"
basis shall be maintained by Seller for a minimum period of five (5) years after the completion
of this Agreement and for such other length of time necessary to cover liabilities arising out of
the activities under this Agreement.
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 Part is unable to prevent or overcome. By way of
example, Force Majeure may include but is not limited to acts of God, flood, storm, wars,
hostilties, civil strife, strikes, and other labor disturbances, eartquaes, 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 Part, (ii) by the exercise of reasonable foresight such Part
could not reasonably have been expected to avoid and (ii) by the exercise of due dilgence,
such Part shall be unable to prevent or overcome. Force Majeure, however, specifically
excludes the cost or availability of fuel or motive force to operate the Facilty 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 performnce 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 notiçe describing the
particulars of the occurrence, including the start date of the Force Majeure, the cause
of Force Majeure, whether the Facilty remains parially 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 the non-performing Party uses its best effort to remedy its inbilty to
perform; and
15.1.4 the non-performig Party shall provide prompt written notice to the
other Pary 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 Part which arose before the Force Majeure causing the
suspension of performance shall be excused as a result of the Force Majeure.
33
Cedar Creek Wind, LLC-Rattlesnake Canyon
15.3 Neither Part 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 constred to create an association, trst,
parership or joint ventue or to impose a trst or parership duty, obligation or liability
between the Paries. If Seller includes two or more paries, each such pary shall be jointly and
severally liable for Seller's obligations under this Agreement.
SECTION 17: CHOICE OF LAW
Ths Agreement shall be interpreted and enforced in accordance with the laws of the state of
Idaho, excluding any choice of law rules which may direct the application of the laws of another
jursdiction.
SECTION 18: PARTIAL INVALIDITY
It is not the intention of the Parties to violate any laws governng the subject matter of this
Agreement. If any of the terms of the Agreement are finally held or deterined to be invalid,
ilegal or void as being contrar to any applicable law or public policy, all other terms of the
Agreement shall remain in effect. If any ters are fially held or determined to be invalid,
ilegal or void, the Paries shall enter into negotiations concernmg the ters affected by such
decision for the purose of achieving conformity with requirements of any applicable law and
the intent of the Paries to ths Agreement.
SECTION 19: WAIVER
Any waiver at any time by either Pary of its rights with respect to a default under ths
Agreement or with respect to any other matters arsing 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 of copies of all local, state and federal
licenses, permits and other approvals as then may be required by law for the constrction,
operation and maintenance of the Facility. Failure to maintain such lawful status after the
Commercial Operation Date shall be an event of default, subject to Section 12.
34
Cedar Creek Wind, LLC-Rattlesnake Canyon
SECTION 21: SUCCESSORS AND ASSIGNS
This Agreement and all of the ters and provisions hereof shall be binding upon and inure to the
benefit of the respective successors and assign of the Parties hereto, except that no assignent
hereof by either Pary shall become effective without the written consent of both Pares being
first obtained. Such consent shall not be uneasonably witheld. Notwithtanding the foregoing,
any entity with which PacifiCorp may consolidate, or into which it may merge, or to which it
may conveyor tranfer substantially all of its electric utility assets, shall automatically, without
further act, and without need of consent or approval by the Seller, succeed to allofPacifiCorp's
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: ENTIR AGREEMENT
22.1 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 Facilty. No modification of this Agreement shall be
effective unless it is in writing and signed by both Paries.
22.2 By executing this Agreement, each Part releases the other from any
claims, known or unown, that may have arisen prior to the execution date of this Agreement
with respect to the Facilty and any predecessor facilty proposed to have been constructed on
the site of the Facilty.
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.
Notices PacifCorp Seller
All Notices PacifiCorp Cedar Creek Wind, LLC
825 NE Mu1tnomah Street Portland,701B Winslow Way E
OR 97232 Bainbridge Island, WA 98110
Attn: Contract Administration,Attn: Richard W. Burkhardt
Suite 600 Phone: (206) 780 - 3551
Phone: (503) 813 - 5380 Facsimile: (206) 780 - 3571Facsimile: (503) 813 - 6291
E-mail:E-mail:
rburkhardt~suiitpower.com
Duns: 00-790-9013 Duns: 83-297-9483
Federal Tax ID Number: 93-0246090 Federal Tax ID Number:80-0326531
35
Cedar Creek Wind, LLC-Rattlesna/æ Canyon
Notices PacifiCorp Seller
All Invoices:Attn: Back Offce, Suite 700 Attn: ( accountingaysumitpower.com)
Phone: (503) 813 - 5578 Vici Hall, General Accountig
Facsimile: (503)813 - 5580 Manager (vhall(isumtpower.com)
Phone: [phone]
Schedulig:Att: Resource Planing, Suite 600 Attn: (tcameron(isumitpower.com)
Phone: (503) 813 - 6090 Thomas CameronFacsimile: (503) 813 - 6265 [phone]
Payments:Att: Back Offce, Suite 700 Att: (accountigaysumitpower. com)
Phone: (503) 813 - 5578 Vici Hall, General Accountig
Facsimile: (503) 813 - 5580 Manager (vhall(isumtpower.com)
Phone: [phone]
Wire Transfer:Ban One N.A.BNK: Wells Fargo
To be provided in separte letter from To be provided in separate letter fromPacifiCorp to Seller Seller to PacifiCorp
Credit and Att: Credit Manager, Suite 700 Att: RichardW. Burkhardt
Collections:Phone: (503) 813 - 5684 (rburkhardtwummitpower.com)
Facsimle: [phone] Chief Financial Officer
Phone: [phone]
With Additional Attn: PacifiCorp General Counsel Att: Richard W. Burkhardt
Notices of an Phone: [phone] (rburkhardt(ásummitpower.com)
Event of Default Facsimile: [phone] Chief Financial Offcer
or Potential Phone: [phone]
Event of Default Davis Wright Tremaie LLP
to:1201 Thd Avenue, Suite 2200
Seattle, W A 98101
Attention: Scott MacCormack
Facsimile No.: [phone]
The Pares may change the person to whom such notices are addressed, or their addresses, by
providing wrtten notices thereof in accrdance with ths Section.
WITNESS WHEREOF, the Pares hereto have caused ths Agreement to be executed
in th . res ectiv ames as of the date first above wrtten.
Title: Dir , Short Term Origination
and QF Contracts
36
Cedar Creek Wind, LLC-Rattlesnake Canyon
EXlBIT A
DESCRIPTION OF SELLER'S FACILITY
(Seller to Complete)
Seller's Facilty consists of 12 wind turbine generator(s) manufactued by Siemens. More
specifically, each generator at the Facilty is described as:
Type (synchronous or inductive): Asynchronous with Inverter
Model: Siemens SWT-2.3-101
Number of Phases: Thee
Rated Output (kW): 2,300 Rated Output (kV A): 2,555
Rated Voltage (line to line): 750V
Rated Current (A): Stator: Converter Supply Curent: 1953A; Rotor: 2070 A
Maximum kW Output: 2300 kW Maximum kV A Output: 2555kV A
Minimum kW Output: _40_ kW
Manufacturer's Published Cut-in Wind Speed: 4 meters/second
Facilty Capacity Rating: 27,600 kW at or above rated wid speed and below cut-out
speed
Maximum Facilty Delivery Rate: _27,176 kW at PacifiCorp Goshen
Substation at 345 kV
Maximum GIA Delivery Rate 151,800 - instataneous kW (combined with the other Cedar
Creek Projects described in Addendum L)
Identify the maximum output of the generator(s) and describe any differences between that
output and the Nameplate Capacity Rating: Maximum generator output is 2300 kW (same as
Nameplate Capacity Rating)
Station service requirements, and other loads served by the Facilty, if any, are described
as follows: Station service requirements consist of Cedar Creek Wind Operations and
Maintenance building loads, tubine stadby loads, and tubine cutout loads. Average tubine
standby load for Rattlesnake Canyon is approximately 60 kW. Cutout loads would be infrequent
and not concurrent with stadby loads.
Location of the Facilty: The Facility is located in Bingham County, Idaho. The location is
more paricularly described as follows: 43° 17.177' Latitude, 11202.997' Longitude WGS84.
Locations of each tubine tower relative to other qualifying facilties owned by Cedar Creek
Wind showing Cedar Creek Wind's compliance with the spacing requirements in 18 C.F .R. §
292.204 are attched hereto.
Power factor requirements:
Rated Power Factor (PF) or reactive load (kV AR): 0.9 Leading to 0.9 Lagging
Seller has provided a copy of manufactuer's Power Cure (Rev. 4, June 2010) for the Siemens
SWT-2.3-1OL. PacifiCorp maintains the power curve in its fies pursuant to a Non-Disclosure
Agreement between PacifiCorp and Seller.
A-I
Cedar Creek Wind, LLC-Rattlesnalæ Canyon
EXHIBIT A - Attachments
1. Cedar Creek Wind Far Site Map
2. Distance Between Wind Turbines of Adjacent Qualifyng Facilties
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Distance Between Wind Turbines of Adjacent Qualifying Facilites
Date 1111612010
The table below lists the distance between turbines in separate Qualifying
Facilities. These distance are based on the turbine locations defned by Wind
Logics in their Turbine Layout Revision 5 docmerit dated 11/16/10.
North Point/Coyote Hil
Turbine Turbine Distance
T6 T14 5632.2'
T6 T15 5356.1'
T6 T16 5638.0'
17 T14 6161.2'
17 T15 5610.9'
17 T16 5594.1'
17 T17 5595.3'
T11 T15 6361.3'.)
T11 T16 5842.6';
T11 T17 5401,7'
Coyote HiUlRatlesnake Canyon'
Turbine Turbine Oistahce
T$6 T22 $5$8,5'
T36 T23 6057.0'
T36 T24 6504.5'
T37 T22 5378.4'
T37 T23 5629.7'
T37 T24 5898.e'
North Point/SteeD Ridae
Turbine TUrbine Distance
T12 T25 5799.5'
T12 T27 5397.2'
T12 T30 5401.6'
T12 T32 5358.6'
Stee Ridge/Coyote Hill
Turbine Turbine 1 Distance
T32 T24 1 1534.9Î
Steep . RitlgelRat1etinake Oanyan
Turbine ITurbine I Qistance
T34 IT40 19#8.3'
Stee i).' RidgelFivePirie
Turbine Turbine Di.$lance
148 T29 5466.8'
T48 T31 5558.3'
T48 T35 5921.7'
Verified by:
-"'-"--'-'-~'-'--'-'---."',-"~---"---~--"-,,,,,,,- -'.. ,-~.
Cedar Creek Wind, LLC-Rattlesnake Canyon
EXHIBITB
POINT OF DELIVERY / PARTIES' INERCONNECTION FACILITIES
(Seller has provided the following single line drawing of the Facility interconnection facilities
including meterng points used to calculate Net Output and any transmission facilities on Seller's
side ofthe Point of Delivery.)
The Metering Point and the Point of Delivery is the PacifiCorp 345kV bus at the Goshen
substation.
The Project wil be shared by a 34.5kV-345kV collector substation. Each project wil have a
34.5kV breaker that wil connect to a common 34.5kV bus. The bus wil connect to a central
34.5kV main breaker, 34.5-345kV Power Transformer, 345kV breaker, line disconnect switch
and a 5.1 mile 345kV transmission line to the Goshen Substation.
B-1
Cedar Creek Wind, LLC-Rattlesnake Canyon
EXHIBIT B - Attachments
1. Substation Metering One-Line Diagram
B-2
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Cedar Creek Wind, LLC-Rattlesnake Canyon
EXHBITC
REQUIRED FACILITY DOCUMENTS
Qualifyng Facilty Number from FERC: QF10-535-000
The following Documents are required prior to delivery of any output from the Facility:
Generation Interconnection Agreement
Agreement permitting Seller access to shared interconnection facilities
Property rights required to maintain and operate the Project in accordance with this
Agreement (site leases, transmission easements, etc).
The following Permits are required on or before the milestone date specified in Section 2.2.1.
Federal Aviation Admnistration Determination of No Hazard
Bingham County Special Use Permit
Crossing agreements with paries other than PacifiCorp Transmission
C-1
Cedar Creek Wind, LLC-Rattlesnake Canyon
EXHIBITD
SUBSEQUENT ENERGY DELIVERY SCHEDULE
Rattlesnake Canyon Wind Pro.ject
Scheduled Monthly
Energy Delivery AvekW/mo
Januar
Februar
March
April
May
June
July
August
September
October
November
December
TOTAL:
Planned Outages. Seller will provide a Planed Outage schedule anually not to exceed 150
hours per year.
D-1
Cedar Creek Wind, LLC-Rattlesnake Canyon
EXHIBITE
START-UP TESTING
Required factory testing includes such checks and tests necessar to determine that the
equipment systems and subsystems have been properly manufactued and installed, function
properly, and are in a condition to perit safe and efficient start-up of the Facility, which may
include but are not limited to:
1. Test of mechancal and electrical equipment;
2. Calibration of all monitoring instrents;
3. Operating tests of all valves, operators, motor starters and motor;
4. Alar, signs, and fail-safe or system shutdown control tests;
5. Point-to-point continuity tests;
6. Bench tests of protective devices; and
7. Tests required by manufactuer(s) and designer(s) of equipment.
Required star-up tests are those checks and tests necessar to determine that all features
and equipment, systems, and subsystems have been properly installed and adjusted, fuction
properly, and are capable of operating simultaneously in such condition that the Facility is
capable of continuous delivery into PacifiCorp's electrcal system, which may include but are
not limited to:
1. Turbine/generator mechancal rus and fuctionaity;
2. System operation tests;
3. Brake tests;
4. Energization oftransformers;
5. Synchronizing tests (maual and auto);
6. Excitation and voltage regulation operation tests;
7. Auto stop/sta sequence;
8. Completion of any state and federal environmental testing requiements; and
9. Tests required by manufactuer(s) and designer(s) of equipment.
For wind projects only, the following Wind Turbine Generator Installation Checklists are
required documents to be signed offby Manufactuer or Subcontract Category Commissioning
Personnel as par ofthe Commissioning and staup testing:
Turbine Installation
Foundation Inspection (by Owner's independent inspector)
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
Cedar Creek Wind, LLC-Rattlesnake Canyon
EXHIBIT F-l
MOTIVE FORCE PLAN
WIND SPEED DATA SUMMARIES & HOURLY WIND PROFILE
F1-1
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EXHIBITF-2
ENGINEER'S CERTIFICATION
RATTLESNAKE CANYON
I hereby certify that I am a Licensed Professional Engineer who is licensed to practice
engineering in the state of Idaho and that I have no economic relationship, association,
or nexus with Cedar Creek Wind, LLC and no involvement in the subject wind
project.
Having reviewed, and in reliance 1 upon the Western Energy Group, LLC, Cedar
Creek, Idaho, Site Visit Summar report dated September 30, 2010, and Cedar Creek
Wind Far Turbine Layout Analysis dated November 16, 2010, prepared by Wind
Logics on behalf of Cedar Creek Wind, LLC, I hereby certify:
MAES IN EXHIBIT F-l ARE ACCURATE;
(2) THAT THE AVERAGE ANNUAL NET OUTPUT ESTIMATE is 73,115,397
KWH PER YEAR IN EACH FULL CALENDAR YEAR OF THIS AGREEMENT
BASED ~ MOTIVE FORC PLAN IN EXHIBIT F-I;
(3) THAT THE FACILITY, UNDER AVERAGE DESIGN CONDITIONS, LIKELY
WILL GE TE NO MORE / i 0 aWW IN ANY CALENDAR MONTH.
Rob
i No independent verification of the raw wind data contained in summar fonn in Exhibit F-l has been
conducted.
Exibii F-2 Engineer's Certifcate Sleep Ridge (2).doc
Cedar Creek Wind, LLC-Rattlesnake Canyon
EXHIBITG
SAMPLE ENERGY PURCHASE PRICE CALCULATIONS
The following are samples of calculations of energy purchase prices using the formula and tables
in Section 5.1.
The calculation for the non-Ievelized purchase price durng an On-Peak Hour in May of 2011
equals $60.24/MWh (the 2011 annual rate for Conforming Energy) multiplied by 92% (0.92)
(the May On-Peak Hour multiplier) minus $6.50/MWh (the wind integration cost), which equals
$48.92/MWh.
Table 1: Sample calculations for non-Ievelized On-Peak Conforming Energy in 2011: Purchase
Price = (anual rate * monthly On-Peak multiplier) - wind integration cost.
Conformig
Energy Calculated Purchase
Annual Rate On-Peak Wind Price for 2011 On-
for 2011 Hour Integration Peak Conforming
Month (per MWh) Multiplier Cost Energy (per MWh)
Januar $60.24 103%$6.50 $55.55
February
...
$60.24 105%$6.50 $56.75
March $60.24 95%$6.50 $50.73
April $60.24 95%$6.50 $50.73
May $60.24 92%$6.50 $48.92
June $60.24 94%$6.50 $50.13
July $60.24 121%$6.50 $66.39
August $60.24 121%$6.50 $66.39
September $60.24 109%$6.50 $59.16
October $60.24 115%$6.50 $62.78
November $60.24 110%$6.50 $59.76
December $60.24 129%$6.50 $71.21
Table 2: Sample calculations for non-levelized Off-Peak Conforming Energy in 2011: Purchase
Price = (anual rate * monthly Off-Peak multiplier) - wind integration cost.
Conformig
Energy Calculated Purchase
Annual Rate Off-Peak Wind Price for 2011 Off-
for 2011 Hour Integration Peak Conforming
Month (perMWh)Multiplier Cost Energy (per MWh)
Januar $60.24 94%$6.50 $50.13
Februar $60.24 97%$6.50 $51.93
March $60.24 80%$6.50 $41.69
G -1
Cedar Creek Wind, LLC-Rattlesnake Canyon
Conforming
Energy Calculated Purchase
Annual Rate Off-Peak Wind Price for 2011 Off-
for 2011 Hour Integration Peak Conforming
Month (perMW)Multiplier Cost Energy (per MWh)
April $60.24 76%$6.50 $39.28
May $60.24 63%$6.50 $31.45
June $60.24 65%$6.50 $32.66
July $60.24 92%$6.50 $48.92
August $60.24 106%$6.50 $57.35
September $60.24 99%$6.50 $53.14
October $60.24 105%$6.50 $56.75
November $60.24 96%$6.50 $51.33
December $60.24 120%$6.50 $65.79
G-2
Cedar Creek Wind, LLC-Rattlesnake Canyon
EXHIBITH
Seller Authoriation to Release Generation Data to PacifiCorp
H -1
WEST~RNENERGY
May 7, 2010
Pacificorp
Attn: Kenneth Huston
825 NE Multnomah, Ste. 1600,
Portland, Oregon 97232
RE: Cedar Creek Wind, LLC PacifiCorp Transmission
Dear Mr. Huston:
Cedar Creek Wind, LLC hereby voluntarily authorizes PacifiCorp's Tranmission business unit
to share Ceda Creek Wind, LLC's generator interconnection information and generator meter
data with market fuction employees of PacifiCorp, including, but not limited to the those in the
Commercial and Trading group. Ceda Creek Wind, LLC acknowledges that PacifiCorp did not
provide it any preferences, either operational or rate-related, in exchange for this voluntar
consent.
Sincerely,~~~~
Dana C. Zentz, P.E.
Vice President
Summit Power Group, Inc.lCedar Creek Wind, LLC
[phone] (Office)
[phone] (Mobile)
!!lWis:-i:Jl .il $ ;d~ .. .mm _ !5~"'~2 ~~_¡M_~~~ m A JIl!.~ie~_ !$i'00~r.
Cedar Creek Wind, LLC
701 Winslow Way E., Suite B
Bainbridge Island, WA 98110
1
206.780-3551
fax: [phone]
CONFIDENTIAL
Cedar Creek Wind, LLC-Rattlesnake Canyon
ADDENDUML
STATION LOAD, LOSSES, and NET OUTPUT
ALLOCATION ALGORITHM FOR THE
CEDAR CREEK WIN, LLC PROJECTS
This Addendum L is hereby made a par of, and clarfies cerin terms in, the Power Purchase
Agreement between Cedar Creek Wind, LLC relating to RATTLESNAKE CANON, and
PacifCorp ("Agreement") entered into the ~ßay of -D.l~ 2010. Capitalized terms
not defined herein shall have the meanng set forth in the Agreement. Cedar Creek Wind, LLC
("Seller") and PacifiCorp are at times referred to herein individualy as a "Party" or collectively
as the "Parties".
Cedar Creek Wind, LLC shall own a complex of five (namely, Coyote Hil, Five Pine, Steep
Ridge, Nort Point, and Rattlesnake Canyon) separate, Idaho small wind Qualifyng Facilities
(each, a "Cedar Creek Project" and collectively, the "Cedar Creek Projects") that share
collector wires, a 34.5/345 kV substation (Cedar Creek Substation), and related equipment,
which connect the Qualifying Facilties to the Point of Deliver ("Shared Interconnection
Facilties").
PacifiCorp has agreed to buy (and Seller has agreed to sell), at the Point of Delivery, Seller's
total energy output net of: (1) Seller's station service; (2) energy provided by Seller to another
Cedar Creek Project for station service; (3) Seller's share of the transformation losses; and (4)
Seller's share of the line losses between Seller's Facility and the Point of Deliver (together
Seller's "Station Auxilary Load and Losses"). However, Seller and PacifiCorp agree that it is
impossible to measure Seller's Station Auxilar Load and Losses separate and apar from the
Station Auxiliar Load and Losses of the other Cedar Creek Projects. Therefore, in order to
implement an objective, practicable, and equitable process by which PacifiCorp may quantify
energy delivered by Seller to the Point of Delivery (net of its Station Auxilary Load and
Losses), the Paries do agree as follows:
A. Biling Formulae. PacifiCorp shall determine Seller's Net Output in kWh for puroses of
the Agreement using the method specified below.
1. Definitions
the nameplate rating (a/a Facilty Capacity Rating) of Cedar Creek Project i
the sum of all the nameplate ratings of Cedar Creek Projects (i = 1 to 5).
the accumulated purchased energy from Utilty Supplier, as determined at the Point
of Delivery, to supply the net total station auxiliar load and losses for the Shared
Interconnection Facilities for Cedar Creek Projects i = 1 to 5 whenever such total
load and losses exceeds total generation output.
the allocated share of P ALLT for Project i as determined by multiplying P ALLT by
NR¡ and dividing by NRT.
NR¡=
NRT =
PALLT =
PALL¡
L-1
Cedar Creek Wind, LLe-Rattlesnake Canyon
OP¡ for a given integration interal, the metered output energy of Cedar Creek Project i,
as determined by PacifiCorp's meter at the point where Cedar Creek Project i
connects to the Shared Interconnection Facilities. For any integration interval
during which any energy is delivered to a Project from the Shared Interconnection
Facilities, such delivered energy is accumulated in a separate meter register and
does not decrement the register used to measure accumulated OP¡. Therefore OP¡ is
by definition always greater than or equal to zero, and in the event the. meter records
OP¡ less than zero, OP¡ shall be deemed to equal zero.
OPT = the sum of all OP¡ (i = 1 to 5).
NOr = for a given integration interal, the total energy delivered to the Point of Delivery
(345 kV bus at Goshen Substation). NOT shall be as measured at PacifiCorp's
meter near the Point of Delivery (kWh, in lO-minute interals), adjusted for any
transformation losses between the meter and the Point of Delivery. For any
integration interval durg which any energy is delivered to the Point of Delivery
from PacifiCorp's system, such delivered energy is accumulated in a separate meter
register of the PacifiCorp meter and does not decrement the register used to
measure accumulated Net Output energy. Therefore NOT is by defiition always
greater than or equal to zero and in the event the meter records NOT less than zero,
NOT shall be deemed to equal zero.
NOi = the net energy sold to PacifiCorp by Cedar Creek Project i durng the integration
intervaL.
SALLT = the total of all station auxilary load and losses for the Shared Interconnection
Facilities for Cedar Creek Projects (i = 1 to 5) when NOris positive.
SALL¡ = the allocated share for Cedar Creek Project i of SAL LT.
2. Calculations
Calculations shall be reconciled and settled monthy. Calculations shall be based upon raw data
gathered from specified meters using a metering integration interal of 5, 10, or 15 minutes at
PacifiCorp's election to match the metering installation PacifiCorp specified ("integration
interval"). Calculations shall be rounded to the nearest kilowatt-hour in the final step.
(a). When Total Generation Output oc= Station Auxiliary Load and Losses
When, for any integration interal, the total of all OPi Project output amounts of energy among
all Cedar Creek Projects (OPT) is less than or equal to the total station auxiliar load and losses
for the Shared Interconnection Facilities, the meters at the Point of Delivery wil accumulate the
Utility Supplier's delivery of purchased energy, P ALLT, to supply such net total load and losses
in a meter register that is separate from that which accumulates NOT and NOT shall equal zero or
if negative, be deeed to equal zero. The "Utiity Supplier" shall be the utilty providing retail
electrc servce at the Facility (Rocky Mountain Power). PacifiCorp shall have no obligation to
serve any of the Cedar Creek Projects' retail electrc needs absent a separate wrtten agreement
with PacifiCorp and then only with the permission of Seller's Utiity Supplier. None of the costs
associated with provision of retail electrc service to Seller shall be borne by PacifiCorp.
L-2
Cedar Creek Wind, LLC-Rattlesnake Canyon
(b). When Total Generation Output ;: Station Auxiliary Load and Losses
When, for any integration interval, the total generation of energy among all Cedar Creek Projects
is greater than the total station auxiliar load and losses for the Shared Interconnection Facilities,
the meters at the Point of Delivery will accumulate in a separate register PacifiCorp's receipt of
the total combined energy from all the Projects (NOT). The difference between OPT and NOT for
that interal (SALLT) is allocated to each Cedar Creek Project in proportion to its generation
output (OPi) in the same integration interval to determine NOi by the formulae:
Let SALLT = ( OPT - NOT J and
SALLi = (SALLT J * (OPi / OPT J
The Net Output energy sold by each Project i is then determined as:
NOi = (OPi - SALLi J and substituting for SALL¡ ;
NOi NOT * (OPi / OPT)
B. Limitation of PacifiCorp Purchase Liabilty. PacifiCorp's total purchase obligation to the
Cedar Creek Projects shall at no time exceed total energy delivered by the Cedar Creek Projects
to the Point of Delivery. Therefore, in the event the sum of the Net Output energy (calculated
according to the preceding formulae) for all the Cedar Creek Projects is greater than NOT, then
PacifiCorp shall reduce calculated Net Output energy from each Cedar Creek Project, pro rata
each Cedar Creek Project's share of the OPT, such that the total energy purchased from all the
Cedar Creek Projects at the Point of Deliver by PacifiCorp equals NOT.
C. PacifiCorp Right to Offset. In the event PacifiCorp deterines it has underpaid one or
more Cedar Creek Projects (due to metering error or otherwise) and, as a result of underpaying
one or more Cedar Creek Projects, has overpaid Seller, PacifiCorp may adjust Seller's future
payment(s) accordingly in order to recapture any overpayment received by Seller in a reasonable
time.
D. Condition Subsequent. This Addendum L was negotiated jointly among the Cedar Creek
Projects and PacifiCorp and is intended by all of the Cedar Creek Projects and PacifiCorp to be
one of five identical bilateral agreements, each between PacifiCorp and a Cedar Creek Project,
but each related to the other. Therefore, in the event one or more Cedar Creek Projects does not
agree to be bound by the ters and conditions set forth in this Addendum L, PacifiCorp may,
upon thiry days wrtten notice, cancel all Addendum L agreements. In the event PacifiCorp
cancels this Addendum L in accordance with this Section D, PacifiCorp may satisfy its
obligation to pay Seller by depositing when due, with an escrow agent chosen by the Cedar
Creek Projects, the total payment due to all Cedar Creek Projects under their respective Power
Purchase Agreements, less offsets (if any) calculated based upon NOT and the Contract Price.
(END)
L-3