20110110Application.pdf

~. ROCKY MOUNTAINPOR
A DISION OF PAIFICOP E J ~,/ ,"'- r-;
201 South Main, Suite 2300
Salt Lake Cit, Uth 84111
Janua 8,2011
1011 JAN J 0 Arf 9: 39
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VI OVERNGHT DELIVERY
Idaho Public Service Commssion
472 W. Washigton Street
P.O. Box 83720
Boise, Idaho 83720-0074
Attention: Jean D. Jewell
Commssion Secreta
PAc-6- i( ~
RE: In the Mattr of the Applications of Rocky Mountan Power for Approval of Power Purchase
Agreements Between Rocky Mountain Power and Cedar Creek Wind
Please fid enclosed the onginal and seven (7) copies each of five separte Applications and
Power Purhae Agreements between Rocky Mounta Power under which Ceda Creek would
sell and Rocky Mounta Power would purchae electrc energy generted from each of the five
Ceda Creek Wind projects ("Projects") located in Bingh County, Idaho:
Project Name
Rattlesna Canyon
Coyote Hil
Nort Point
Steep Ridge
i/ 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 diected to Ted Weston, Idao Reguatory Manager at [phone], or
Danel Solander, Senior Counel, at [phone].
\fry Truy Your,IJ;lri ~ / ti1
Jeffey K. Larsen
Vice President, Regulation
Enclosures
!:~;;E'Cf:
¿UH JAN l 0 AM 9: Ll5
PA--É - a -o
PROJECT
FIV PINE
Mark C. Moench
Daniel E. Solander
Yvonne R. Hogle
Rocky Mountain Power
201 South Main Street, Suite 2300
Salt Lake City, Utah 84111
Telephone: [phone]
Fax: [phone]
Email: mark.moench(ßpacificorp.com
danel.solander(ßpacificorp.com
yyonne.hogle(ßpacificorp.com
tOj I HHd .,. O. A'r."l Q. 1.5.."Yo'''....._ " H 1 Jca q",'
Attorneys for Rocky Mountain Power
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-ll-.a
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 Utilty Regulatory
Policies Act of 1978 ("PURPA"), hereby respectfully applies to the Idaho Public Utilities
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 and RM
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 Five Pine Project ("Facilty"). In support of this
Application RMP represents as follows:
I. BACKGROUND
1. Communications 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:
Daniel E. Solander
201 South Main, Suite 2300
Salt Lake City, Uta 84111
Telephone: [phone]
Fax: [phone]
Email: daniel.solander(ßpacificorp.com
In addition, the Company respectfully requests that all data requests regarding this
matter be addressed to one or more of the following:
Bye-mail (preferred)datarequest~pacificorp.com
By regular mail Data Request Response Center
PacifiCorp
825 NE Multnomah, Suite 2000
Portland, OR 97232
2. Sections 201 and 210 ofPURPA, and pertinent regulations of the Federal
Energy Reguatory Commission ("FERC"), require that regulated electric utilities
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, constrct, install, own, operate, and
maintain a 25.2 megawatt ("MW") (Facility Capacity Rating) wind generating facility
named Five Pine, to be located in Bingham County, Idaho. The Facilty will be a QF
under the applicable provisions of PURP A. The PP A for this Facility and the other four
Cedar Creek projects; Rattlesnake Canyon, North Point, Coyote Hil, and Steep Ridge,
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 Arguents are scheduled for Januar 27,2011. As par ofthe
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 reguations, and this
Commission's Orders to enter into power purchase agreements with PUR A QFs. As
stated in the Joint Petition filing, RMP has received multiple requests from PURP A wind
QF developers for published avoided cost rate PPAs. The Company continues to process
these requests as part of its normal course of business with the appropriate level of due
dilgence to ensure these potential resources comply with all PURP A reguations and
Commission Orders and are submitted to this Commission for review and decision, as is
its legal obligation. However, the request in ths Application, the other four Applications
for Cedar Creek Wind projects, as well as several other QF PPA Applications that will be
fied 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
unettered PURPA QF generation on system reliability, 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 curent 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-stadard QF project using the
Commission Ordered IRP-methodology addresses the specific operating characteristics of
the QF as par 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 wil have a significant
impact on the net power cost portion of its Idaho and other jurisdiction customer's rates.
The Five Pine 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 communty-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 threshold and
therefore too low. In May 2010, Cedar Creek resubmitted five individual QF projects
totaling 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 PURPA's reguation including the
1-mile separation requirement, and met all Idaho rules and Commssion 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 stadard 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 instace, the published
avoided cost prices are significantly higher than the avoided cost prices produced using
the IRP-methodology. Furher, stadard 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-methodology and the stadard default pricing nature of the QF process will 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 anual incremental expense
associated with these five contracts be situs assigned to the state of Idaho. Ths would be
in addition to Idaho's allocation of the cost produced by IRP-methodology valuation
representative of the avoided cost RMP would have otherwse 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 signficant 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
andthe 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 varous Commission Orders applicable to this
PURPA agreement for a wind resource. See Order Nos. 29632, 30423, 31021, and 31025.
A copy of the PPA is attched to this Application as Attachment 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"). Ths PP A was executed
by Cedar Creek on December 13, 2010. It was subsequently executed by RMP on
December 22,2010, and now filed for the Commission's review on January 7, 2011.
11. The nameplate rating of this Facility is 25.2 MW. Cedar Creek has attested
and documented through its generation profie that the Facility wil not exceed 10 aMW
on a monthly basis. Furhermore, as described in Section 5.3 of the PPA, should the
Facility exceed 10 aMW on a monthly basis, RMP will accept the energy that does not
exceed the Maximum Facility Delivery Rate (Inadvertent Energy), but will not purchase
or pay for this Inadvertent Energy.
12. This PURPA wind agreement includes the Mechanical Availability
Guarantee ("MAG"), Wind Integration Cost adjustment, and Wind Forecasting cost
sharng 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
$1,441,280 for the Five Pine project with retur of the securty as specific PP A
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 wil monitor compliance with these initial requirements. In addition, RMP will
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 RMP for the cost of securng the network resource
and transmission service request.
15. Cedar Creek's projects share a common collector substation for the five
wind QF projects including Five Pine, 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 (ltNRIt) on RMP's system, which requires the Company's merchant
fuction to submit a Transmission Service Request (ltTSRIt) on behalf of the Facility to
PacifiCorp Transmission. Submission of such request will occur by Januar 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 sufficient time and resources will be
available to constrct the interconnection facilities, and transmission upgrades if required,
in time to allow the Facility to achieve the Scheduled Commercial Operation Date. Cedar
Creek has been further 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 curilment or disconnection of its Facility should certain operating
conditions develop on the Company's system. Section 6 of the PPA defines the conditions
for curailment and obligations of Cedar Creek in the event of curtilment.
19. Section 2.1 of the PPA provides that the PPA will not become effective
until the Commssion 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 will be allowed as prudent and legitimate expenses for
ratemakng 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
utilty 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 hearing is not necessar to consider the issues
presented herein and respectfully requests that this Application be processed' under
Modified Procedure, i.e., by written submissions rather than by hearing. Reference
Commission Rules of Procedure, IDAPA 31.01.01.201-204. If, however, the Commission
determines that a technical hearing is required, the Company stands ready to prepare and
present its testimony in such hearng.
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 Five Pine facilty.
Dated this 7th day of Januay, 2011
Respectfully submitted,
.--/ .. .,r! ~ flit' ~ l\~ A./! !. , FBy(tj/~ I/~ 3¿,
Danel E. Solander / /'
Attorney for Rocky Mountain Power
POWER PURCHASE AGREEMENT REGf:
BETWEN ZDll JAr4 i 0 AM 9: 45
CEDAR CREEK WIND, LLC
iUPrl"iLiRelating to FIVE PINE, a Wind Turbine Generation Proj!êUT¡ES
a non-fueled, on-system, Intermittent Resource with Mechancal Availabilty Guarantee,
Idaho Qualifying Facility-lOaMW /Month or less
AND
PACIFICORP
Section 1: Definitions................................................. ................. ....................................... 1
Section 2: Term, Commercial Operation Date ................................................................... 9
Section 3: Representations and Waranties.................. ................................ ................. .... 12
Section 4: Delivery of Power; Availabilty Guaranty....................................................... 15
Section 5: Purchase Prices ...................,............................................................................ 17
Section 6: Operation and Control .......................................................................~............. 19
Section 7: Motive Force....................................................................................................22
Section 8: Generation Forecasting Costs .......................................................................... 23
Section 9: Metering; Reports and Records ....................................................................... 23
Section 10: Bilings, Computations and Payments ,.............. ............ ................................ 25
Section i 1: Securty ..............,...........................................................................................26
Section 12: Defaults and Remedies .................................................................................. 28
Section 13: Indemnfication; Liabilty.............................................................................. 30
Section 14: Insurance........................................................................................................ 31
Section 15: Force Majeure................................................................................................ 32
Section 16: Several Obligations........................................................................................ 33
Section 17: Choice of Law.................................................................................. .............. 33Section 18: Paral Invalidity .......,....................................................................................33
Section 19: Waiver............................................................................................................ 33
Section 20: Governental Jurisdiction and Authorizations ............................................. 33
Section 21: Successors and Assigns........................................ ..... .... ................... ............. 34
Section 22: Entire Agreement...........................................................................................34
Section 23: Notices ........................................................................................................... 34
Cedar Creek Wind, LLC-Five Pine
POWER PURCHASE AGREEMENT
THIS POWER PURCim AGREE T, relating to FIVE PINE, a wind turbine generation
project entered into ths day of , 20lQ is between Cedar Creek Wind, LLC,
a Delaware limited liabilty company ( e "Seller") and PacifiCorp, an Oregon corporation
acting in its merchant function capacity ("PacifiCorp"). Seller and PacifiCorp are referred to
collectively as the "Parties" and individualy as a "Party".
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 Facilty Capacity Rating of 25,300-kilowatts (kW) as fuer described
in Exhibit A and Exhibit B ("Facilty").
B. Seller has secured rights to deliver output from its Facilty to PacifiCorp across
interconnection facilties shared by five Quaifyg Facilties (Coyote Hil, Five Pine, Steep
Ridge, North Point, and Rattlesnake Canyon); the five Quaifyng Facilties have agreed to
allocate comingled line losses on those interconnection facilties as set fort in Addendum L.
C. Seller intends to operate the Facilty as a Quaifying Facilty, as such term is
defined in Section 1.55 below, and to sell Net Output to PacifiCorp in Idao.
D. Seller estiates that the average anual Net Output to be delivered by the Facilty
to PacifiCorp is 74,111,209 kilowatt-hours (kWh) ("Average Annual Net Output") pursuapt to
the Intial Year Energy Delivery Schedule in Section 4.3.1, which amount of energy PacifiCorpwill include in its resource plang. )
E. Seller intends to sell and PacifiCorp intends to purchase all the Net Output from
the Facility in accordace with the terms and conditions of ths Agreement.
F. PacifiCorp intends to designate Seller's Facilty as a Network Resource for the
puroses of servg Network Load.
G. This Agreement is a ''New QF Contract" under the PacifiCorp Inter-Jursdictional
Cost Allocation Revised Protocol.
H. Seller i: has U has not authorized Transmission Provider to release generation
data to PacifiCorp. If yes, the authorization is attched as Exhibit H.
NOW, THEREFORE, the Pares mutuly agree as follows:
SECTION 1: DEFITIONS
When used in this Agreement, the following term shall have the following meanings:
1.1 "As-built Supplement" shall be a supplement to Exhibit A, provided by Seller
followig completion of constrction of the Facilty, accurately describing the completed
Facility.
1
Cedar Creek Wind, LLC-Five Pine
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 Facilty Delivery Rate during the Biling
Period over (y) the product ofthe 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 durng minutes in which it is (a) in an
emergency, stop, service mode or pause state; (b) in "ru" status and faulted; or (c) otherwse not
operational or capable of delivering at the Maximum Facilty Delivery Rate to the Point of
Delivery; uness if unavailable due solely to (i) a default by PacifiCorp; (ii) to the extent not
caused by Seller's actions, a curtlment in accordance with Section 6.3 or (iii) insuffcient wid
(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 "Biling Period" means the time period between PacifiCorp's reading of its
power purchase meter at the Facilty and for ths Agreement shall coincide with calenda month.
1.4 "Commercial Operation" means that not less than the 90% of the expected
Facilty Capacity Rating is fuly operational and reliable and the Facilty is fuly interconnected,
fully integrated, and synchronized with the System, all of which shall be Seller's responsibility to
receive or obtan, and which occurs when all of the following events (i) have occured, and (ii)
remain simultaneously tre and accurate as of the date and moment on which Seller gives
PacifiCorp notice that Commercial Operation has occured:
1.4.1 PacifiCorp has received a certficate addressed to PacifiCorp from a
Licensed Professional Engineer (a) stating the Facilty Capacity Rating of the Facilty atthe anticipated time of Commercial Operation and (b) stating that the Facilty is able to
generate electrc power reliably in amounts required by ths Agreement and in accordance
with all other terms and conditions of this Agreement.
1.4.2 Sta-Up Testing of the Facilty has been completed in accordance with
Exhibit E.
1.4.3 PacifiCorp has received a certficate addressed to PacifiCorp from a
Licensed Professional Engineer, an attorney in good standing in Idao, or a letter from
Transmission Provider, statig that, in accordance with the Generation Interconnection
Agreement, all required interconnection facilties have been constrcted, all required
interconnection tests have be~n completed and the Facility is physically interconnected
with the System in conformance with the Generation Interconnection Agreement and able
to deliver energy consistent with the terms of this Agreement, and the Facility is fuly
integrated and synchronized with the System.
1.4.4 PacifiCorp has received a certficate addressed to PacifiCorp from a
Licensed Professional Engineer, or an attorney in good standing in Idaho, stating that
Seller has obtained all Required Facilty Documents and, if requested by PacifiCorp in
wrting, Seller shall have provided copies of any or all such requested Required Facilty
Documents.
2
Cedar Creek Wind, LLC-Five Pine
1.45 Seller has complied with the securty requirements of Section 11.
1.4.6 Network Resource Designation and Transmission Service Request. (i)
PacifiCorp ha received confirmation 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 servce request has been granted in
sufficient capacity to meet or exceed the Maximum Facility Delivery Rate and the Seller
has paid all costs associated with any requirements of the tranmission service request.
1.5 "Commercial Operation Date" means the date, as designated by PacifiCorp
pursuant to Section 2.4, the Facilty first achieves Commercial Operation.
1.6 "Commission" means the Idaho Public Utilities Commission.
1.7 "Conforming Energy" mean all Net Energy except Non-Conformg Energy.
1.8 "Conforming Energy Purchase Price" mean the applicable price for
Conformng Energy and capacity, specified in Section 5.1.
1.9 "Contract Year" mea a twelve (12) month penod commencing at 00:00 hours
Pacific Prevailig Time ("PPT") on Janua 1 and endig on 24:00 hours PPT on December 31;
provided, however, that the first Contract Yea shal commence on the Commercial Operation
Date and end on the next succeedig December 31, and the last Contract Year shall end on the
Expiration Date, uness earlier termted as provided herein.
1.10 "Cut-in Wind Speed" mea the wid speed at which a stationar wid tubine
begins producing Net Energy, as specified by the turbine manufacturer and set fort in Exhibit
A.
1.11 "Delay Liquidated Damages", "Delay Daily Minimum", "Delay Period",
"Delay Price" and "Delay Volume" shal have the meangs set fort in Section 2.5 of this
Agreement. "Delay Security" shall have the meang set fort in Section 11.1.1 of this
Agreement.
1.12 "Default Security" shall have the meanng set fort in Section 11.2 of this
Agreement.
1.13 "Effective Date" shall have the meaning set forth in Section 2.1 of ths
Agreement.
1.14 "Energy Delivery Schedule" shall have the meanng set fort in Section 4.3 of
this Agreement.
1.15 "Environmental Attributes" means any and all claims, credits, benefits,
emissions reductions, offsets, and allowances, howsoever entitled, resultig from the avoidance
of the emission of any gas, chemical, or other substace to the ai, soil or water, which are
deemed of value by PacifiCorp. Environmenta Attbutes include but are not limited to: (1) any
avoided emissions of pollutats to the air, soil, or water such as (subject to the foregoing) sulfu
3
Cedar Creek Wind, LLC-Five Pine
oxides (SOx), nitrogen oxides (NOx), carbon monoxide (CO), and other pollutats; and (2) any
avoided emissions of carbon dioxide (C02), methane (CH4), and other greenhouse gases
(GHGs) that have been determed by the United Nations Intergovernental Panel on Climate
Change to contribute to the actual or potential threat of altering the Ear's climate by trapping
heat in the atmosphere. Environmental Attibutes do not include (i) Production Tax Credits or
certai other ta incentives existing now or in the future associated with the constrction,
ownership or operation of the Facilty, (ii) matters designated by PacifiCorp as sources of
liabilty, or (ii) adverse wildlife or environmenta impacts.
1.16 "Environmental Contamination" means the introduction or presence of
Hazdous Materials at such levels, quantities or location, or of such form or character, as to
constitute a violation of federal, state or local laws or reguations, and present a material risk
under federal, state or local laws and regulations that the Premises will not be available or usable
for the puroses contemplated by this Agreement.
1.17 "Expiration Date" shall have the meaning set fort in Section 2.1 of this
Agreement.
1.18 "Facilty" is defined in Recital A of this 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 meanng set fort in Section 15.1.
1.21 "Forced Outage" means an outage that requires removal of one or more Wind
Turbines from servce, 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" means the generation interconnection
agreement entered into separately between Seller and Transmission Provider, as applicable,
specifying the Point of Delivery and providing for the constrction and operation of the
Interconnection Facilties.
1.23 "Governmental Authority" means any supranational, federal, state or other
political subdivision thereof, having jursdiction over Seller, PacifiCorp or this Agreement,
including any municipalty, township or county, and any entity or body exercising executive,legislative, judicial, reguatory or admnistrative fuctions of or pertaiing to governent,
including any corporation or other entity owned or controlled by any of the foregoing.
1.24 "Hazardous Materials" mean any waste or other substance that is listed,
defined, designated or classified as or determned to be hazdous under or pursuat to any
environmenta law or reguation.
1.25 "Inadvertent Energy" means: (1) energy delivered to the Point of Delivery in
excess of the Maximum Monthy Purchase Obligation; and (2) energy delivered to the Point of
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Cedar Creek Wind, LLC-Five Pine
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 mea 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, uness 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 utilzed for such days. If
the ICE index or any replacement of that index ceases to be published during the term of ths
Agreement, PacifiCorp shall select as a replacement a substatially equivalent index that, after
any appropriate or necessar 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
uneasonably withold, condition or delay.
1.27 "Initial Year Energy Delivery Schedule" shal have the meaning set fort in
Section 4.3.1.
1.28 "Interconnection Facilties" mean all the facilties and ancilar equipment used
to interconnect the Facilty to the System, as defined in the Generation Interconnection
Agreement.
1.29 "Letter of Credit" mean an irrevocable stadby letter of credit in a form
reasonably acceptable to PacifiCorp, namng PacifiCorp as the pary entitled to demand payment
and present draw requests thereunder. Such letter of credit shall be provided by an institution
that is a United States office of a commercial ban or trst 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 leas "A" from Stadard & Poor's and "A2" from Moody's
Investor Services, and (uness 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
training and experience in the engineering discipline(s) relevant to the matters with respect to
which such person is called to provide a cerification, evaluation and/or opinon, 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 manufactuer or supplier of any equipment installed in the Facility. Such
Licensed Professional Engineer shall be licensed in an appropriate engineerig discipline for the
required certfication being made. The engagement and payment of a Licensed Professional
Engineer solely to provide the certifications, evaluations and opinions required by ths
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" mean any outage of one or more Wind Turbines that is
not a Forced Outage or a Planed Outage. A Maintenance Outage is an outage that can be
deferred until afer the end of the next weekend, but that requires that the Wind Turbine( s) be
5
Cedar Creek Wind, LLC-Five Pine
removed from service before the next Planed Outage. A Maintenance Outage may occur any
time durng the year and must have a flexible star 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 Seller's abilty to fulfill its obligations under ths
Agreement.
1.33 "Maximum Facilty Delivery Rate" means the maximum instantaeous rate
(kW) 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 "Maximum 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 fort in Exhibit A.
1.35 "Maximum Monthly Purchase Obligation" means the maxmum amount of
energy PacifiCorp is obligated to purchase under this Agreement in a calendar month. In
accordance with Commission Order No. 29632, the Maximum Monthly Purchase Obligation for
a given month in kWh, shall equal 10,000 kW multiplied by the total number of hours in that
month and prorated for any parial month; provided however that, subsequent to the Effective
Date of this Agreement, any change by the Commssion to the Maxmum Monthy Purchase
Obligation established by Order No. 29632 shall have no affect on the obligations of the Paries
pursuant to ths Agreement.
1.36 "Nameplate Capacity Rating" means the maximum instataeous generatig
capacity of any qualifying small power or cogeneration generating unt supplyig 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 operatig 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" means the Nort American Electric Reliabilty Corporation.
1.38 "Net Energy" means the energy component, in kWh, of Net Output. Net Energy
does not include Inadvertent Energy.
1.39 "Net Output" mean all energy and capacity produced by the Facilty, less station
use and less tranformation and transmission losses and other adjustments, if any. For puroses
of calculating payment under this Agreement, Net Output of energy shall be calculated as set
fort in Addendum L. Net Output does not include Inadvertent Energy.
1.40 "Network Resource" shall have the meanng set forth in the Tariff.
1.41 "Network Service Provider" means PacifiCorp Transmission, as a provider of
network service to PacifiCorp under the Tariff.
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Cedar Creek Wind, LLC-Five Pine
1.42 "Non-Conforming Energy" meas Net Output produced by the Facilty 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-Peak Hours" mean all hours of the week that are not On-Peak Hours.
1.45 "On-Peak Hours" mean hours from 6:00 a.m. to 10:00 p.m. Pacific Prevailing
Time, Monday though Satuday, excludig Western Electcity Coordinating Council (WECC)
and Nort American Electrc Reliability Corpration (NERC) holidays.
1.46 "Output Shortfall" and "Output Shortfall Damages" shall have the meanings
set fort in Section 4.5 of this Agreement.
1.47 "PacifCorp" is defied in the first paragraph of ths Agreement, and excludes
PacifiCorp Transmission.
1.48 "PacifCorp Transmission" means PacifiCorp, an Oregon corporation, acting in
its interconnection and transmission fuction capacity.
1.49 "Planned Outage" mean an outage of predetermned duration that is scheduled
in Seller's Energy Delivery Schedule. Boiler overhauls, tubine overhauls or inspections are
tyical planed outages. Maintenance Outages and Forced Outages are not Planed Outages.
1.50 "Point of Delivery" means the point of interconnection between the Facilty 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 will be located, as
more fully described on Exhibit A.
1.52 "Prime Rate" means the rate per anum equa to the publicly anounced prie
rate or reference rate for commercial loan to large businesses in effect from tie to time quoted
by JPMorgan Chase & Co. If a JPMorgan Chase & Co. prime rate is not available, the
applicable Prime Rate shall be the anounced prime rate or reference rate for commercial loans
in effect from time to time quoted by a ban with $10 bilion or more in assets in New York
City, N.Y., selected by the Pary to whom interest based on the prime rate is being paid.
1.53 "Production Tax Credits" means production ta credits under Section 45 of the
Internal Revenue Code as in effect from time to time durg 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 stte ta credit determined by
reference to renewable electric energy produced from wid resources for which the Facility is
eligible. Production Tax Credits do not include any tax 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 signficant portion of the electrical utilty industr or any of the
7
Cedar Creek Wind, LLC-Five Pine
practices, methods or acts, which, in the exercise of reasonable judgment in the light of the facts
known at the time a decision is made, could have been expected to accomplish the desired result
at the lowest reasonable cost consistent with reliability, safety and expedition. Prudent Electrcal
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 Facilty", as that term is defined in the version of
FERC Regulations (codified at 18 CFR Par 292) in effect on the date of ths Agreement.
1.56 "Required Facilty Documents" means all deeds, titles, leases (including Wind
Leases), licenses, permits, authonzations, and agreements demonstrating that seller controls the
necessary property rights and governent authorizations to constrct, operate, and maintain the
Facility, including without limtation those set fort in Exhibit C.
1.57 "Requirements of Law" means any applicable and mandatory (but not merely
advisory) federal, state and local law, statute, regulation, rue, code or ordinance enacted,
adopted, issued or promulgated by any federal, state, local or other Governenta Authority or
regulatory body (including those pertaining to electrcal, building, zoning, environmental and
occupational safety and health requirements).
1.58 "Scheduled Commercial Operation Date" means 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 porton 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 meanings set fort 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.
1.63 "System" means the electric transmission substation and transmission or
distrbution facilities owned, operated or maintaned by Transmission Provider, which shall
include, after constrction and installation ofthe Facility, the circuit reinforcements, extensions,
and associated terminal facilty reinforcements 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.1 1 Pro Forma Open Access Transmission Tarff or the Transmission
Provider's correspondig FERC taff or both, as revised from time to time.
1.65 "Transmission Provider" mean PacifiCorp Transmission or a successor,
including any regional transmission organization ("RTO").
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Cedar Creek Wind, LLC-Five Pine
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 ty SWT-2.3-10l Siemens 2,300 kilowatt wind
tubine. At its full Facilty Capacity Rating, the Facilty will consist of 11 Wind Turbines.
SECTION 2: TERM, COMMERCIAL OPERATION DATE
2.1 This Agreement shall become effective afer execution by both Paries and afer
approval by the Commission ("Effectie Date"); provided, however, this Agreement shall not
become effective until the Commission has determed, 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 incured by PacifiCorp for purchases of capacity and energy from
Seller are legitimate expenses, all of which the Commssion will allow PacifiCorp to recover in
rates in Idaho in the event other jurisdictions deny recovery of their proportonate share of said
expenses.
Unless earlier terminated as provided herein, the Agreement shall remain in effect until
24:00 PPT September 30,2032 ("Expiration Date").
2.2 Time is of the essence of ths Agreement, and Seller's abilty to meet certn
requiements 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 obtan and provide to PacifiCorp
copies of all governental permits and authoritions listed in Exhibit C.
2.2.2 By the date 30 calendar days after the Effective Date, Seller shall provide
Delay Securty required under Section 11.1.1, as applicable.
2.2.3 By June 30, 2011, Seller: (i) has provided all information and paid all fees
the Tranmission Provider requires to designate the Facility as a Network Resource in
accordance with the Tariff (OATI); and (ii) has provided all information reasonably
required by PacifiCorp to submit a transmission service request for the Facility to the
Transmission Provider pursuant to the Tarff.
2.2.4 At leat 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.
9
Cedar Creek Wind, LLC-Five Pine
2.2.7 By 00:00 PPT October 1, 2012, Seller shall achieve Commercial
Operation ("Scheduled Commercial Operation Date").
2.3 Beginng October 1, 2011, Seller shall provide PacifiCorp a one-page monthly
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 confirm to Seller that all of the
conditions to Commercial Operation have been satisfied or have occured, 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 Facilty 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 Pares. If Seller submits a Techncal Dispute Notice and the
Techncal Expert determines that Commercial Operation has been achieved, then the
Commercial Operation Date shall be the date, as determined by the Techncal Expert~ that the
Facilty first met all the requirements of Commercial Operation; otherwse 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 informs PacifiCorp that Seller intends to
bring the Facility 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
Facility Capacity Rating.
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 Paries may have such dispute, and only such dispute,
resolved pursuant to ths Section 2.4.1. Any such dispute will be determined by an
independent techncal expert, who shall be a mutually acceptable third par 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 Industr Arbitration Rules and Mediation
Procedures (Including Procedures for Large, Complex Constrction 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, above, with the American Arbitration Association
("AA") by notifying AAA and the other Par in writing ("Technical Dispute
10
Cedar Creek Wind, LLC-Five Pine
Notice") of such Par's desire that the dispute be resolved though a
determtion by a Technical Expert. -
(b) The determnation shall be conducted by a sole Technical Expert.
The Paries may select any mutualy acceptable Technical Expert. If the Paries
canot agree on a Techncal Expert within five (5) days after the date of the
Techncal Dispute Notice, then the AA's Arbitration Administator shall send a
list and resumes of thee (3) avaiable techncal expert meeting the qualifications
set fort in Section 2.41 to the Paries, each of whom shall strike one name, and
the remaing person shall be appointed as the Technical Expert. If more than
one name remain, either because one or both Paries have failed to respond to the
AAA's Arbitration Admstrator within five (5) days afer receiving the list or
because one or both Pares have failed to strike a name from the list or because
both Partes strike the same name, the AA's Arbitration Adminstrator wil
choose the Techncal Expert from the rèmaining names. If the designated
Technical Expert shall die, become incapable or, unwillng to, or unable to serve
or proceed with the determination, a substitute Technical Expert shall be
appointed in accordance with the selection procedure described above, and such
substitute Techncal Expert shall have all such powers as if he or she has been
originally appointed herein.
(c) With thrt (30) days of the appointment of the Technical Expert
pursuat to the foregoing sub-section, each Pary shall submit to the Technical
Expert (and copy the other Par) a wrtten report containing its position with
respect to the dispute, and arguents therefor together with supporting
documentation and calculations. Discovery shall be limited to Facilty documen-
tation relating to the disputed matter. Withn sixty (60) days from receipt of such
submissions, the Techncal Expert shall select one or the other Pary's position
with respect to the disputed, arbitrate-able issues set forth in paragraph 2.4.1
above, whereupon such selection shall be a bindig determination upon the
Paries for all puroses hereof. The costs of the Technical Expert, including his or
her fees and expenses, shall be borne by the Par whose position was not selected
by the Technical Expert; eah Pary shall otherwse bear its own expenses. If the
Technical Expert fails to render a decision withn ninety (90) days from receipt of
each Par's submissions, either Pary may, prior to the Technical Expert's final
decision, initiate litigation, in which case the Techncal Expert's final decision
shall not be binding on the Pares uness otherwse agreed.
2.4.2 All verbal and wrtten communications between the Paries and issued or
prepared in connection with this Section 2.4.1 shall be deemed prepared and
communcated in fuherance, and in the context, of dispute settlement, and shall be
exempt from discovery and production, and shall not be admssible in evidence (whether
as admission or otherwse) in any litigation or other proceedings for the resolution of the
dispute.
2.4.3 All deadlines specified in ths Section 2.4 may be extended by mutul
agreement of the Paries.
11
Cedar Creek Wind LLC-Five Pine
2.5 Delay Damages. Seller shall cause the Facility to achieve Commercial Operation
on or before the Scheduled Commercial Operation Date. If Commercial Operation occurs after
the Scheduled Commercial Operation Date, Seller shall be liable to pay PacifiCorp delay
damages for the number of days ("Delay Period") the Commercial Operation Date occurs afer
the Scheduled Commercial Operation Date, until the earlier of occurence of the Commercial
Operation Date or the termination of ths Agreement ("Delay Liquidated Damages"), provided
that Seller shall not accrue any Delay Liquidated Damages after: (i) Seller has tiely 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 accordace 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 Minimum or (2)
the Delay Price times the Delay Volume
Where:
"Delay Daily Minimum" equals (a) for the first forty-five (45) calenda days
followig the Scheduled Commercial Operation Date: one-ninetieth (1I90th) of
forty-five dollars ($45) multiplied by the MaximWT Facilty Delivery Rate with
the Maximum Facilty Delivery Rate being measured in kW; (b) afer the fort-
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 monthy Conforming Energy
Purchase Prices; and
"Delay Volume" equals the applicable Scheduled Monthly Energy Delivery
divided by the number of days in that month.
2.5.2 Appropriateness of Damages. The Pares 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 difficult or impossible to
predict with certainty, and that the Delay Liquidated Damges are an appropriate
approximation of such damages.
SECTION 3: REPRESENTATIONS AND WARNTIES
3.1 PacifiCorp represents, covenants, and warants to Seller that:
3.1.1 PacifiCorp is duly organized 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 ths Agreement.
12
Cedar Creek Wind, LLC-Five Pine
3.1.3 PacifiCorp has taen all corporate actions required to be taen by it to
authorize the execution, delivery and pedormance 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
indentu, mortage, or other material agreement binding on PacifiCorp or any valid
order of any cour, or any reguatory agency or other body having authority to which
PacifiCorp is subject.
3.1.5 Subject to Commssion 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 ths Agreement may be limited by banptcy,
insolvency, ban moratorium or similar laws affecting creditors' rights generally and
laws restricting the availabilty of equitable remedies and except as the enforceabilty of
ths Agreement may be subject to general pnnciples of equity~ whether or not such
enforceabilty is considered in a proceeding at equity or in law).
3.2 Seller represents, covenants, and warants to PacifiCorp that:
3.2.1 Seller is a limted liabilty company duly organzed and validly existing
under the laws of Delaware.
3.2.2 Seller has the requisite power and authority to enter into ths Agreement
and has, or will have at the date of Commercial Operation of the Facility, all requisite
power and authority to perform accordig to the terms hereof, including all required
regulatory authority to make wholesae sales from the Facilty.
3.2.3 Seller's shareholders, directors, and officers have taen all actions required
to authorize the execution, delivery and pedormance of this Agreement and the
consumation of the tranactions contemplated hereby.
3.2.4 The execution and delivery of ths Agreement does not contravene any
provision of, or constitute a default under, any indenture, mortgage, or other material
agreement binding on Seller or any valid order of any cour, 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 agait Seller in accordance with its terms (except as the enforceabilty of
this Agreement may be limited by banptcy, insolvency, ban moratorium or similar
laws affectig creditors' nghts generally and laws restrctig 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 enforceabilty 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 certifcation, which may include a Federal
13
Cedar Creek Wind, LLe-Five Pine
Energy Regulatory Commission self-certification to PacifiCorp prior to PacifiCorp's
execution of this Agreement. At any tie PacifiCorp has reason to believe durng the
term of ths Agreement that Seller's status as a QF is in question, PacifiCorp may require
Seller to provide PacifiCorp with a wrtten 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 Facilty, 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 maintaed and will continue to maintan 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 banptcy proceeding, is unable to ,pay its
bils in the ordinar 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, tite and interest in and to the Facility, free and clear
of all liens and encumbrances other than liens and encumbrances related to third-pary
financing of the Facility, and Seller (or its successor in interest) will continue to own for
the term of this Agreement, 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-pary
financing of the Facility.
3.2.11 In entering into this Agreement and the undertaking by Seller of the
obligations set fort herein Seller has investigated and determned that it is capable of
performing hereunder and has not relied upon the advice, experience or expertise of
PacifiCorp in connection with the transactions contemplated by ths Agreement.
3.2.12 All professionals or experts including, but not limited to, engieers,
attorneys or accountants, that Seller may have consulted or relied on in underting the
transactions contemplated by ths Agreement have been solely those of Seller.
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 shall 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.
14
Cedar Creek Wind, LLC-Five Pine
3.3 Notice. If at any time durng ths Agreement, any Par obtais actual knowledge.
of any event or information which would have caused. any of the representations and waranties
in this Section 3 to have been materially untre or misleading when made, such Pary shall
provide the other Party with written notice of the event or information, the representations and
waranties affected, and the action, if any, which such Par intends to take to make the
representations and waranties true and correct. The notice required pursuant to this Section
shall be given as soon as practicable afer the occurence of each such event.
SECTION 4: DELIVERY OF POWER; AVAILABILITY GUARATY
4.1 Delivery and Acceptance of Net Output. Except for any curlment specified in
Section 6.3, unless otherwise provided herein, PacifiCorp will purchase and Seller wil sell all
Net Output from the Facilty.
4.2 No Sales to Thrd Paries. Durng 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 followig:
4.3.1 During the first twelve full calendar months following the Commercial
Operation Date, Seller predicts that the Facilty will produce and deliver the following
monthy amounts ("Initial Year Energy Delivery Schedule"):
Month Energy Delivery (kWh)Avg.kW
Janua 6,111,881 8,215
Februar 5,751,609 8,559
March 6,383,379 8,580
April 5,813,013 8,074
May 5,749,609 7,728
June 5,971,092 8,293
July 5,813,754 7,814
August 6,445,274 8,663
September 6,196,070 8,606
October 6,298,805 8,466
November 6,764,871 9,396
December 6,811,853 9,156
TOTAL:74,111,209 8,460
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Cedar Creek Wind, LLC-Five Pine
4.3.2 Seller may revise the Initial Year Energy Delivery Schedule any time prior
to the Commercial Operation Date.
4.3.3 Beginning at the end of the nith full calendar month of operation, and at
the end of every third month thereafer, Seller shall supplement the Energy Delivery
Schedule with thee 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 will 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 afer 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 durng 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 calenda months of Commercial
Operation. After 5:00 p.m. PPT of the fift business day following the end of the thrd
full calendar month of Commercial Operation and the end of each thrd 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
this 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 will be deemed to be an election of no change.
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 Availability, the resulting shortfall shall be expressed in kWh as the
"Output Shortall." The Output Shortall shall be calculated in accordance with the following
formula:
Output Shortall = (Guaranteed Availability - Availabilty) *
Scheduled Monthy Energy Delivery
Seller shall pay PacifiCorp for any Output Shortfall at the lower of (l) 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 Conforming Energy Purchase Prices ("Output Shortfall Damages").
Output Shortfall Damages = Output Shortfall * Output Shortfall Price
Where:
Output Shortfall Price =(Index Price - Weighted Average CEPP), except
that if Output Shortfall Price -0 0, then Output
Shortfall Price = 0, and except that if Output
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Cedar Creek Wind, LLC-Five Pine
Shortall Price ~ Weighted Average CEPP, then
Output Shortall Price = Weighted Average CEPP
Weighted Average CEPP = the weighted average On-Peak and Off-Peak
Conforming Energy Purchase Prices for the month
of Output Shortfall
If an Output Shortall occurs in any given month, Seller may owe PacifiCorp liquidated
damages. Each Pary agrees and acknowledges that (a) the damages that PacifiCorp would incur
due to the Facilty's failure to achieve the Guateed Avaiabilty would be difficult or
impossible to predict with certaity, 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 reta all performance related data
for the Facility for a minimum of thee 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 will pay
Seller Conforming Energy or Non-Conformg Energy Purchae Prices for Net Output adjusted
for the month and On-Pea Hours or Off-Peak Hours and the wind integration cost using the
followig formulae, in accordance with Commssion Order Nos. 30423,31025, and 31021:
Conforming Energy Purchase Price = (ARte * MPM) - WIC
Non-Conforming Energy Purchase Price = (ARnce * MPM) - WIC
Where:
AR =Conformng Energy anua rate from Table 1, below, for the year
of the Net Output.
the lower of.
85% of the Conformg Energy anual rate from Table 1
below, for the year of Net Output
ARnce =
or
MPM =
85% of average of the daily Index Price for each day of the
month, or porton of month, of Net Output.
monthy 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 during On-Peak Hours or Off-Peak Hours.
$6.50/MWh, the wid integration cost prescribed in Commission
Order No. 31021.
WIC =
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Cedar Creek Wind, LLC-Five Pine
Example calculations are provided in Exhibit G.
Table 1: Conforming Energy Annual Rates (from Commission Order No. 31025)
Conforming Energ
Annual Rate (.ARee)
Year S/Mh
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
2028 113.26
2029 116.56
2030 119.95
2031 124.51
2032 128.50
Table 2: Monthly On-PeaklOff-Peak Multipliers
Month On-Peak Off-Peak
Hours Hours
Januar 103%94%
Februar 105%97%
March 95%80%
April 95%76%
May 92%63%
June 94%65%
July 121%92%
August 121%106%
September 109%99%
October 115%105%
November 110%96%
December 129%120%
5.2 Payment.
For each Biling Period in each Contract Year, PacifiCorp shall pay Seller as follows:
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Cedar Creek Wind, LLC-Five Pine
For delivery of Conformng Energy:
Payment = (CEnergyon-Peak * CEPPriceon_pea / 1000) +
(CEnergYoff-Peak * CEPPriceoff-Peak / 1000)
For delivery of Non-Conformg Energy:
Payment (NCEnergyon-Peak * NCEPPriceo_Peak / 1000) +
(NCEnergYOf-pea * NCEPPriceoff-Peak / 1000)
Where:
CEnergy
CEPPrice
NCEnergy
NCEPPrice
On-Pea
Off-Peak
=Conformg Energy in kWh
Conformg Energy Purchase Price in $/MWh
Non-Conforming Energy in kWh
Non-Conforming Energy Purchase Pnce in $/M
the correspondig value for On-Peak Hours
the correspondig value for Off-Peak Hours
=
=
=
5.3 Inadvertent Energy. So long as acceptace of Inadvertent Energy does not cause
PacifiCorp to violate the terms of its Network Transmission Servce and is consistent with
Prudent Electrcal Practices, PacifiCorp will accept Indverent Energy, but will not purchase or
pay for Inadvertent Energy.
SECTION 6: OPERATION AND CONTROL
6.1 As-Buit Supplement. Upon completon of any constrction affecting the Facilty,
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 PacifCorp, which approval shall not uneasonably be witheld,
conditioned or delayed.
6.2 Operation. Seller shall operate and maitan the Facilty in a safe maner in
accordance with the Generation Interconnection Agreement, Prudent Electrical Practices and in
accordance with the requiements of all applicable federal, state and local laws and the National
Electrc 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 electrc system is disconnected, suspended or interpted,
in whole or in par, pursuat to the Generation Interconnection Agreement, or to the extent
generation curilment is requied as a result of Seller's non-compliance with the Generation
Interconnection Agreement. PacifiCorp shall have the right to inspect the Facility to confrm
that Seller is operating the Facilty in accordace with the provisions of this Section 6 upon
reasonable notice to Seller. Seller is solely responsible for the operation and maintenance of the
Facilty. PacifiCorp shall not, by reason of its decision to inspect or not to inspect the Facilty, or
by any action or inaction taken with respect to any such inspection, assume or be held
responsible for any liability or occurence arsing from the operation and maintenance by Seller
of the Facilty.
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Cedar Creek Wind, LLC-Five Pine
6.3 Curailment. PacifiCorp shall not be obligated to purchase, receive, pay for, or
pay any damages associated with, Net Output (or associated Production Tax Credits or
Environmenta Attibutes) if such Net Output (or associated Production Tax Credits or
Environmental Attibutes) is not delivered to the System or Point of Delivery due to any of the
followig: (a) the interconnection between the Facility and the System is disconnected,
suspended or interrupted, in whole or in par, consistent with the terms of the Generation
Interconnection Agreement, (b) the Transmission Provider or Network Service Provider directs a
general curtilment, reduction, or redispatch of generation in the area, (which would include the
Net Output) for any reason, even if such curailment or redispatch directive is caried out by
PacifiCorp, which may fufill such directive by acting in its sole discretion; or if PacifiCorp
curls or otherwse reduces the Net Output in order to meet its obligations to the Transmission
Provider or Network Service Provider to operate withn system limitations, (c) the Facilty's
Output is not received because the Facilty is not fully integrated or synchronized with the
System, or (d) an event of Force Majeure prevents either Par from delivering or receiving Net
Output. Seller shall reasonably determine the MWh amount of Net Output curailed pursuant to
ths Section 6.3 afet the fact based on the amount of energy that could have been generated at
the Facility and delivered to PacifiCorp as Net Output but that was not generated and delivered
because of the curlment. Seller shall determine the quantity of such curled energy based on
(x) the time and duration of the curailment period and (y) wid conditions recorded at the
Facility during the period of curailment 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 confrm to its reasonable
satisfaction the amount of energy that was not generated or delivered because of a curlment
described in this Section 6.3.
6.4 PacifiCoro as Merchant. Seller acknowledges that PacifiCorp, acting in its
merchant capacity fuction 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 Planed Outages. Except as otherwse provided herein, Seller shall not
schedule Planed Outage during any porton of the months of November, December,
Janua, Februar, June, July, and August, except tó the extent a Planed Outage is
reasonably required to enable a vendor to satisfy a guantee requirement in a situation in
which the vendor is not otherwse able to pedorm the guarantee work at a time other than
during one of the months specified above. Seller shall, in Exhibit D, provide PacifiCorp
with an anual forecast of Planed Outages for each Contract Year at least one (1) month,
but no more that thee (3) months, before the first day of that Contract Year, and shall
promptly update such schedule, or otherwse 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 Planed 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 will occur: (a) the outage as predicted in the Planed Outage
schedule; or (b) the outage per Seller's revised plans. Such notice shall consist of a
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Cedar Creek Wind, LLC-Five Pine
Monday-Sunday, hourly spreadsheet showing the revised total Facilty curlment (MW)
for that scheduling week. Seller shall not schedule any maintenance of Shared
Interconnection Facilties durg November, December, Janua, Februar, June, July, or
August, without the pnor written approval of PacifiCorp, which approval may be
reasonably witheld by PacifiCorp.
6.5.2 Maintenance Outages. If Seller reasonably determines that it is necessar
to schedule a Maintenance Outae, Seller shall notify PacifiCorp of the proposed
Maintenance Outage as soon as practicable but in any event at least five (5) days before
the outage begins (or such shorter period to which PacifiCorp may reasonably consent in
light of then existing wind conditions). Upon such notice, the Paries 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 durng the followig periods: June 15 though June 30,
July, August, and September 1 though September 15. Seller shall include in such notice
of a proposed Maintenance Outage the expected sta date and time of the outage, the
amount of generation capacity of the Facility that will not be available, and the expected
completion date and time of the outage. Seller may provide notices under this Section
6.5.2 orally. Seller shall conf any such oral notication 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 substatial impact on Seller. Seller shall notify
PacifiCorp of any subsequent changes in generation capacity of the Facilty during such
Maintenance Outage and any changes in the Maitenance Outage completion date and
time. Seller shall tae all reasonable measures and exercise its best efforts consistent with
Prudent Electrcal Practices to miize the frequency and duration of Maintenance
Outages.
6.5.3 Forced Outages. Seller shall promptly provide to PacifiCorp an oral
report, via telephone to a number specifed by PacifiCorp, of any Forced Outage of the
Facilty. Such report shall include the amount of generation capacity of the Facility that
will not be available because of the Forced Outage and the expected retu date and time
of such generation capacity. Seller shall promptly update the report as necessar to
advise PacifiCorp of changed circumstaces. If the Forced Outage resulted in more than
15% of the Facilty Capacity Rating of the Facilty being unavailable, Seller shall confrm
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 minimize 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 limitation, restrction, derating
or outage known to Seller that affects the generation capacity of the Facilty in an amount
greater than five percent (5%) of the Facilty Capacity Rating for the following day.
21
Cedar Creek Wind, LLC-Five Pine
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 Planed
Outages and Maintenance Outages that Seller reasonably expects to encounter in the
ordinar course of operating the Facilty into the Scheduled Monthy Energy Delivery
amounts in the Energy Delivery Schedule set forth 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 Pary shall designate authorized representatives to
communcate 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
Generation Interconnection Agreement due to Seller's lack of standing as a "scheduling
coordinator" or other RTO recognzed designation, qualification or otherwse, then (a)
Seller shall acquie such RTO recognized stading (or shall contract with a third pary
who has such RTO recognized standing) such that PacifiCorp is no longer responsible for
Seller's performance under the Generation Interconnection Agreement, and (b) Seller
shall defend, indemnify and hold PacifiCorp harless against any liabilty 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 Maximum 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 inspectors ("PacifiCorp
Representatives") with reasonable access to the Facilty: (a) for the purose of reading or testing
metering equipment, (b) as necessar to witness any acceptace tests, ( c) for puroses of
implementing Section 4.6, and (d) for other reasonable puroses at the reasonable request of
PacifiCorp. PacifiCorp shall release Seller against and from any and all any and all loss, fines,
penalties, claims, actions or suits, including costs and attorney's fees, both at tral and on appeal
resulting from actions or omissions by any of the PacifiCorp Representatives in connection with
their access to the Facilty, 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 ths Agreement, Seller provided to PacifiCorp Wind Leases and
a motive force plan including an hourly wind profile acceptable to PacifiCorp in its reasonable
22
Cedar Creek Wind, LLC-Five Pine
discretion and atthed hereto as Exhibit F-l, together with a certification from a Licensed
Professional Engineer to PacifiCorp attched hereto as Exhibit F-2, certifying that the
implementation of the fuel or motive force plan can reasonably be expected to provide fuel or
motive force to the Facilty for the duration of ths Agreement adequate to generate power and
energy in quantities necessar to deliver the Average Anual Net Output.
SECTION 8: GENERATION FORECASTING COSTS
8.1 Forecast Service Election. PacifiCorp may, in its discretion, add forecasting
services for Seller's Facilty to PacifCorp's existig contract with a qualified wind-energy-
production forecasting vendor, which contract and vendor may change durg the term of this
Agreement.
8.2 Seller's Forecast-Cost Share. Pursuant to Commission Order No. 30497, Seller
shall be responsible for 50% of PacifiCorp's cost of adding such forecasting services ("Seller'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 tota payments made by PacifiCorp to Seller for Net Output
during the previous Contract Year '("SeIler's Capped Forecast-Cost Share"). If the last
Contract Year of this Agreement is shorter than a ful caenda year, the cap will be prorated for
that shortened year. For the years) prior to the second Contract Year of this agreement that
equals a ful calendar year, Seller's Forecas-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 equa payments for each month of such year except the last
month of such year. (For example, in a Contract Year equag a ful calenda year, Seller would
pay l/llth of Seller's Forecast-Cost Share durg 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 Forecas-Cost Share. For a Contract Year
encompassed by just one calendar month, Seller's payment to PacifiCorp and PacifiCorp's
refud to Seller shall be calculated and paid simultaeously. To the extent practicable, payments
and refuds under this Section shall be included in monthy payments and invoices under Section
10.
SECTION 9: METERIG; REPORTS AN RECORDS
9.1 Metering Adjustment. Meterig wil be performed at the location specifed in
Exhibit B and in the maner specified in the Generator Interconnection Agreement. All
quantities of energy purchased hereunder shall be adjusted in accordance with Addendum L, so
23
Cedar Creek Wind, LLC-Five Pine
that 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 inspections 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 actu period canot 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 bilings or payments resulting
from a correction in the meter records shall be made in the next monthly biling or payment
rendered.
9.3 Telemetering. In accordance with the Generation Interconnection Agreement,
Seller shall provide telemetering equipment and facilties capable of transmitting to
Transmission Provider (who will share it with PacifiCorp as authorized by Exhibit H, "Seller
Authorization to Release Generation Data to PacifiCorp") the followig information concerning
the Facilty on a real-time basis, and will operate such equipment when requested by PacifiCorp
to indicate:
(a) instantaneous MW output at the Point of Delivery;
(b) Net Output;
(c) the Facilty's total instataneous generation capacity; and
(d) wind velocity at tubine 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, wid speed data wind direction data and gross
output data. Seller shall provide such real-time data to PacifiCotp in the same detal that Seller
receives the data (e.g., if Seller receives the data in four second intervals, PacifCorp shall also
receive the data in four second intervals). PacifiCorp shall have the right from time to tie to
require Seller to provide additional telemetering equipment and facilties to the extent necessar
and reaonable.
9.4 Monthy Reports and Logs and Other Information.
9.4.1 Reports. Withn thrty (30) calendar days afer the end of each Biling
Period, Seller shall provide to PacifiCorp a report in electronic format, which report shall
include (a) sumaries 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) sumaries of any other signficant events related to the
constrction or operation of the Facilty for the Biling Period; (c) detals of Availabilty
i If station service is supplied via separate facilties, PacifiCorp wil deduct station service from the metered facilty
output to calculate Net Output.
24
Cedar Creek Wind, LLC-Five Pine
of the Facilty for the Biling Perod sufcient to calculate Availabilty and including
hourly average wid velocity meaured at tubine hub height and ambient air
temperature; and (d) any supportg inormation that PacifCorp may from time to time
reasonably request (including historical wid 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 ths Agreement commencing on
the Commercial Operation Date. Seller shall provide PacifiCorp with a copy of the
electronic fault log withn thrt (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' gudelines and recommendations for maintenance of the Facilty
equipment.
9.4.4 By each Janua 10 following the Commercial Operation Date, Seller
shall provide to PacifiCorp wrtten certfication 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 tie from the Effective Date, one (1) year's advance notice of the
termination or expiration of any agreement, includig Wind Leases, pursuat to which
the Facility or any equipment relatig thereto is upon the Facilty site; provided that the
foregoing does not authonze 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 envionmenta laws or reguations arsing out of
the constrction or operation of the Facilty, or the presence of Environmental
Containation at the Facilty or on the Premises, alleged to exist by any Governental
Authority having jursdiction over the Premises, or the present existence of, or the
occurence during Seller's occupancy of the Premises of, any enforcement, legal, or
reguatory action or proceeding relatig to such alleged violation or alleged presence of
Envionmental Contanation presetly occurg or havig occured during the period
of time that Seller has occupied the Premises.
9.5 Maintenance of Metering Eguipment. To the extent not otherwise provided in the
Generator Interconnection Agreement, PacifiCorp shall inspect, test, repair and replace the
meterig equipment periodically, or at the request of Seller if Seller has reason to believe
metering may be off and requests an inspection in wrtig. To the extent not otherwse provided
in the Generator Interconnection Agreement, al PacifiCorp's costs relating to designng,
installing, maintaining, and repairing metering equipment instaled to accommodate Seller's
Facility shall be borne by Seller.
SECTION 10: BILLINGS, COMPUTATIONS AND PAYMENTS
10.1 Payment for Net Output. On or before the thieth (30th) day followig the end
of each Biling Period, PacifiCorp shall send to Seller payment for Seller's deliveries of Net
25
Cedar Creek Wind, LLC-Five Pine
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 ths
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. Thir calendar days afer the end of each
Contract Year, PacifiCorp shall deliver to Seller an invoice showing PacifiCorp's computation of
Output Shortfall, if any, for all Billng Periods in the prior Contract Year and Output Shortfall
Damages, if any. In preparing such invoices, PacifiCorp shall utilze 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 otherwse not available. To the extent
required, PacifiCorp shall prepare any such invoice as promptly as practicable followig 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 wrting by PacifiCorp or by
any other mean agreed to by the Paries in writing from time to tie, the amount set fort as due
in such invoice, and shall within thirty (30) days afer receiving the invoice raise any objections
regarding any disputed porton of the invoice. Objections not made by Seller with the thirty-
day period shall be deemed waived.
10.3 Interest on Overdue Amounts. Any amounts owing afer 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.
lOA Disputed Amounts. If either Pary, in good faith, disputes any amount due
pursuat to an invoice rendered hereunder, such Par shall notify the other Pary 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 occured. If any amount disputed
by such Par is determed to be due to the other Par, or if the Paries resolve the payment
dispute, the amount due shall be paid withn five (5) days afer such determination or resolution,
along with interest in accordance with Section 10.3.
SECTION 11: SECURTY
11.1 Delay Securty:
11.1.1 Duty to Post Securty. By the date provided in Section 2.2.2, Seller shall
post a Letter of Credit, cash or a parenta guaranty, each in a form acceptable to
PacifiCorp, in the amount of$1,441,280 as calculated pursuat to Section 11.1.2 ("Delay
Security"). To the extent PacifiCorp receives payment from the Delay Securty, Seller
shall, within fifteen (15) calendar days, restore the Delay Security as if no such deduction
had occured.
26
Cedar Creek Wind, LLC-Five Pine
11.1.2 Calculation of Delay Securty. The dollar value of Delay Security shall
equal the greater of: (1) fort-five dollar ($45) multiplied by the Maximum Facility
Delivery Rate with the Maximum Facilty Delivery Rate being measured in kW; or (2)
the sum of the products, for each of the fist thee calenda months after the Scheduled
Commercial Operation Date, of:
the energy in the Intial Yea Energy Delivery Schedule for the month (kWh)
multiplied by the monthy weighted average On-Peak and Off-Peak Conformng
Energy Purchase Price for the month ($/M) divided by 1000.
Such amount shall be fied upon execution of ths Agreement.
11.1.3 Right to Draw on Securty. PacifiCorp shall have the right to draw on the
Delay Security to collect Delay Liquidated Damages. Commencing on or about first of
each month, PacifiCorp will invoice Seller for Delay Liquidated Damages incured, if
any, during the preceding month. If inufcient Delay Security is available, Seller shall
pay PacifiCorp for invoiced Delay Liquidated Damages no later than five business days
after receiving such invoice. The Pares will make bilings and payments for Delay
Liquidated Damages in accordance with Section 10.
11.1.4 Paral Release of Delay Securty. Provided that Seller has maintained
Delay Securty in accordance with Section 11.1.1, PacifiCorp shal release one-third of
the origina amount of Delay Securty stted 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 Tranmission Provider; and (ii) paid in ful any interconnection and/or
system upgrade costs Seller is obligated to pay in advance of interconnection
constction.
(b) Seller has poured the concrete foundation at each of its planed
individua Wind Turbine locations.
PacifiCorp shall make the paral refud of Delay Security required above withn ten
business days of the date Seller provides PacifiCorp wntten 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 remaining Delay
Securty upon the earlier of the 30th calendar day following commencement of
Commercial Operation or the 60th calendar day following PacifiCorp's termination of
this Agreement.
11.1.6 Default. Seller's failure to post and maintan Delay Security In
accordance with Section 11.1 will constitute an event of default, uness cured il
accordance with Section 12.1.1 of this Agreement.
11.2 Default Security (Levelized Pncing Only).
27
Cedar Creek Wind, LLC-Five Pine
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 make a payment when due under this
Agreement or post and maintain security in conformance with the requirements of
Section 11 or maintain insurance in conformance with the requirements of Section 14 of
ths Agreement, if the failure is not cured within ten (10) business days afer the non-
defaulting Par gives the defaulting Pary a notice of the default.
12.1.2 Breach of Representation. Breach by a Par of a representation or
waranty set fort in ths 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 paries
related to this Agreement, the Generation Interconnection Agreement, or the Facility
within the time allowed for a cure under such agreement or instrent.
12.1.4 Insolvency. A Pary (a) makes an assignment for the benefit of its
creditors; (b) files a petition or otherwse 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 filed against it and such petition is
not withdrawn or dismissed withn sixt (60) days afer such filing; (c) becomes
insolvent; or (d) is unable to pay its debts when due.
12.1.5 Material Adverse Change. A Material Adverse Change has occured with
respect to Seller and Seller fails to provide such performance assurances as are
reasonably requested by PacifiCorp, with thrt (30) days from the date of such request.
12.1.6 Sale to Third-Par. 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 calenda months.
12.1.8 A Pary otherwse fails to perform any material obligation (including but
not limited to failure by Seller to meet any deadline set fort in Section 2.2.1 though
2.2.6) imposed upon that Par by this Agreement if the failure is not cured within thrt
(30) days afer the non-defaulting Pary gives the defaulting Pary notice of the default.
12.1.9 Seller fails to achieve the Commercial Onlne Date by the 91st day
following the Scheduled Commercial Online Date, provided, however, that, upon wrtten
notice from the defaulting Pary delivered prior to the 91st day of delay, ths ninety (90)
day period shall be extended by an additional one hundred and fift (150) days if (a)
28
Cedar Creek Wind LLC-Five Pine
Seller has poured the concrete foundation at each of its planed individua wind tubine
locations; and (b) Seller replenishes Delay Default Securty 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 ths Agreement is terminated.
12.2 In the event of any default hereunder, the non-defaulting Par must notify the
defaulting Par in wrting of the circumstaces indicatig the default and outlining the
requirements to cure the default. If the default has not been cured within the prescribed time,
above, the non-defaultig Par may termate ths Agreement at its sole discretion by delivering
written notice to the other Pary and may pursue any and all legal or equitable remedies provided
by law or puruat to ths 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 termated because of Seller's default and Seller
wishes to again sell Net Output from the facilty 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 ths Agreement, includig but not limted to the purchase pnces as set fort in
(Section 5), unti the Expiration Date (as set fort in Section 2.1). At such time Seller and
PacifiCorp agree to execute a wrtten document ratifying the terms of this Agreement.
12.4 If ths Agreement is terminated as a result of Seller's default, 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, counterclai, or otherwse withold payment), Seller shall pay PacifiCorp
Output Shortfall Damages for a period of eighteen (18) month from the date of termintion plus
the estimated administrative cost to acquire the replacement power. The Paries agree that the
daages PacifiCorp would incur due to termination resulting from Seller's default would be
diffcult or impossible to predict with certty, and that the daages in ths Section 12.4 are an
appropriate approximation of such damages.
12.5 Recoupment of Damages.
(a) Default Security Available. If Seller has posted Default Security,
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, PacifiCorp may collect
any remaining amount owing by parially witholdig futue payments to
Seller over a reasnable period of time. PacifiCorp and Seller shall work
together in good faith to estalish the period, and monthy amounts, of
such witholding 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 termination event resulting from default under this
Agreement, in addition to and not in limitation of any other right or remedy under this
Agreement or applicable law (including any right to set-off, counterclaim, or otherwse withold
payment), the non-defaulting Par may at its option set-off, against any amounts owed to the
defaulting Pary, any amounts owed by the defaulting Pary under any contract(s) or
29
Cedar Creek Wind, LLC-Five Pine
agreement(s) between the Paries. The obligations of the Paries shall be deemed satisfied and
discharged to the extent of any such set-off. The non-defaulting Par shall give the defaulting
Pary wrtten notice of any set-off, but failure to give such notice shall not afect the validity of
the set-off.
12.7 Amounts owed by Seller pursuat to this Section 12 shall be due within five (5)
business days afer any invoice from PacifiCorp for the same.
SECTION 13: INDEMNIFICATION; LIABILITY
13.l Indemnties.
13.1.1 Indemnty by Seller. Seller shall release, indemnify and hold harless
PacifiCorp, its directors, offcers, agents, and representatives against and from any and all
loss, fines, penalties, claims, actions or suits, including costs and attorney's fees, both at
trial and on appeal, resulting from, or arising out of or in any way connected with (a) the
energy delivered by Seller under ths Agreement to and at the Point of Delivery, (b) any
facilities on Seller's side of the Point of Delivery, (c) Seller's operation and/or
maintenance of the Facilty, or (d) arising from Seller's breach of this Agreement,
including without limitation any loss, claim, action or suit, for or on account of injur,
bodily or otherwise, to, or death of, persons, or for damage to, or destrction or economic
loss of propert belonging to PacifiCorp, Seller or others, excepting only such loss,
clai, action or suit as may be caused solely by the fault or gross negligence, of
PacifiCorp, its directors, officers, employees, agents or representatives.
13.1.2 Indemnity by PacifiCorp. PacifiCorp shall release, indemnfy and hold
harless Seller, its directors, offcers, agents, lenders and representatives against and
from any and all loss, fines, penalties, claims, actions or suits, including costs and
attorney's fees, both at trial and on appeal, resulting from, or arsing out of or in any way
connected with the energy delivered by Seller under this Agreement afer the Point of
Delivery, including without liitation any loss, claim, action or suit, for or on account of
injur, bodily or otherwse, to, or death of, persons, or for damage to, or destruction or
economic loss of property, excepting only such loss, claim, action or suit as may be
caused solely by the fault or gross negligence of Seller, its directors, officers, employees,
agents, lenders or representatives.
13.2 No Dedication. Nothing in ths Agreement shall be constred to create any duty
to, any standard of care with reference to, or any liabilty to any person not a Pary to this
Agreement. No undertking by one Pary to the other under any provision of this Agreement
shall constitute the dedication of that Par' s system or any portion thereof to the other Pary or
to the public, nor afect the status of PacifiCorp as an independent public utilty corporation or
Seller as an independent individual or entity.
13.3 No Waranty. Any review, acceptace or failure to review Seller's design,
specifications, equipment or facilities shall not be an endorsement or a confirmation by
PacifiCorp and PacifiCorp makes no waranties, expressed or implied, regarding any aspect of
30
Cedar Creek Wind, LLC-Five Pine
Seller'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 AR INCLUDED IN THE LIQUIDATED DAMAGES, DELAY DAMAGES, OR
OTHER SPECIFIED MEASURE OF DAMGES EXPRESSL Y PROVIDED FOR IN THIS
AGREEMENT, NEITHER PARTY SHALL BE LIALE TO THE OTHER PARTY FOR
SPECIAL, PUNITIVE, INIRECT, EXEMPLARY OR CONSEQUENTIAL DAMAGES,
WHETHER SUCH DAMGES AR ALLOWED OR PROVIDED BY CONTRCT, TORT
(INCLUDING NEGLIGENCE), STRICT LIABILITY, STATUTE OR OTHERWISE.
SECTION 14: INSURACE
14.1 Certificates. Prior to connection of the Facilty to the System, Seller shall secure
and continuously car insurance in compliance with the requirements of this Section. Seller
shall provide PacifiCorp insurance certficate(s) (of "ACORD Form" or the equivalent)
certifying Seller's compliance with the insurance requirements hereunder. Commercial General
Liabilty coverage wrtten on a "clais-made" basis, if any, shall be specifically identified on the
certificate. If requested by PacifiCorp, a copy of each insuance policy, certified as a tre copy
by an authorized representative of the issuig inurance company, shall be furshed to
PacifCorp.
14.2 Requied Policies and Coverages. Without limiting any liabilties or any other
obligations of Seller under this Agreement, Seller shall secure and continuously cary 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 insurance, to include contractual liabilty,
with a minium single limit of $1,000,000 per occurence to protect against and from al
loss by reason of injur to persons or daage to property based upon and arsing out of
the activity under this Agreement.
14.2.2 All Risk Property insurance providing coverage in an amount at least
equal to 80% of the replacement value of the Facilty against "all risks" of physical loss
or damage, including coverage for ear movement, flood, and boiler and machinery.
The Property policy may contan separate sub-limits and deductibles subject to insurance
company underwiting. gudelines. The Risk Policy will be maintained in accordance
with terms available in the insurance market for simlar facilties.
14.3 The Commercial General Liabilty policy requied herein shall include (i)
provisions or endorsements naming PacifiCorp, its Board of Directors, Officers and employees
as additional insureds, and (ii) cross liabilty coverage so that the inurance applies separately to
each insured 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 primar insurance with respect to the interests of PacifiCorp and that any other
31
Cedar Creek Wind, LLC-Five Pine
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 wrtten notice to PacifiCorp if canceled
for nonpayment of premium, or (ii) thirt (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 maintaned by Seller for a minimum period of five (5) years afer the completion of
this Agreement and for such other length of time necessar to cover liabilities arsing out of the
activities under ths Agreement.
SECTION 15: FORCE MAJEUR
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 Pary is unable to prevent or overcome. By way of example,
Force Majeure may include but is not limited to acts of God, flood, storms, wars, hostilties, civil
strife, strikes, and other labor distubances, earhquaes, fires, lightnng, epidemics, sabotage,
restraint by cour 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 Par, (ii) by the exercise of reasonable foresight such Pary could not reasonably have been
expected to avoid and (iii) by the exercise of due diligence, such Pary shall be unable to prevent
or overcome. Force Majeure, however, specifically excludes the cost or availabilty of fuel or
motive force to operate the Facilty or changes in market conditions that afect the price of
energy or transmission. If either Pary is rendered wholly or in par unable to perform its
obligation under ths Agreement because of an event of Force Majeure, both Paries shall be
excused from whatever pedormance is affected by the event of Force Majeur, provided that:
15.1.1 the non-performing Pary, shall, withn two (2) weeks afer the occurrence
of the Force Majeure, give the other Pary written notice describing the particulars of the
occurence, including the sta date of the Force Majeure, the cause of Force Majeure,
whether the Facilty remains parally 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 requied by the Force Majeure;
15.1.3 the non-performing Par uses its best efforts to remedy its inabilty to
perform; and
15.1.4 the non-performing Pary shall provide prompt wrtten notice to the other
Pary at the end of the Force Majeure event detailng the end date, cause there of, damage
caused there by and any repais tht were required as a result of the Force Majeure event,
and the end date of the Force Majeure.
15.2 No obligations of either Par which arose before the Force Majeure causing the
suspension of performance shall be excused as a result of the Force Majeure.
32
Cedar Creek Wind, LLC-Five Pine
15.3 Neither Par shall be required to settle any strke, walout, lockout or other labor
dispute on terms which, in the sole judgment of the Par involved in the dispute, are contrar to
the Pary's best interests.
SECTION 16: SEVERA OBLIGATIONS
Nothing contained in ths 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.
i
SECTION 17: CHOICE OF LAW
This Agreement shall be interpreted and enforced in accordance with the laws of the state of
Idaho, excluding any choice of law rues which may direct the application of the laws of another
jurisdiction.
SECTION 18: PARTIA INVALIDITY
It is not the intention of the Pares to violate any laws governng the subject matter of this
Agreement. If any of the terms of the Agreement are fmally held or determined to be invalid,
ilegal or void as being contrary to any applicable law or public policy, all other terms of the
Agreement shall remain in effect. If any terms are finally held or determined to be invalid,
ilegal or void, the Paries shall enter into negotiations concerning the terms afected by such
decision for the purose of achieving conformty with requirements of any applicable law and
the intent of the Pares to ths Agreement.
SECTION 19: WAIVER
Any waiver at any tie by either Pary of its rights with respect to a default under this
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
PacifCorp's compliance with the term of ths 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 requied by law for the constrction,
operation and maintenance of the Facilty. Failur to maintai such lawf sttus afer the
Commercial Operation Date shall be an event of default, subject to Section 12.
33
Cedar Creek Wind, LLC-Five Pine
SECTION 21: SUCCESSORS AND ASSIGNS
This Agreement and all of the terms and provisions hereof shall be binding upon and inure to the .
benefit of the respective successors and assigns of the Paries hereto, except that no assignent
hereof by either Party shall become effective without the written consent of both Pares being
first obtained. Such consent shall not be uneasonably witheld. Notwithstading the foregoing,
any entity with which PacifiCorp may consolidate, or into which it may merge, or to which it
may conveyor transfer substatially all of its electric utility assets~ shall automatically, without
furer act, and without need of consent or approval by the Seller, succeed to all ofPacifiCorp's
rights, obligations~ and interests under this Agreement. This arcle shall not prevent a financing
entity with recorded or secured rights from exercising all rights and remedies available to it
under law or contract. PacifiCorp shall have the right to be notified by the financing entity that it
is exercising such rights or remedies.
SECTION 22: ENTIRE AGREEMENT
22.1 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 Facility. No modification of this Agreement shall be effective unless it is in
wrting and signed by both Paries.
22.2 By executing this Agreement, each Par releases the other from any
claims, known or unown, that may have arsen prior to the execution date of ths Agreement
with respect to the Facility and any predecessor facilty proposed to have been constrcted on the
site of the Facilty.
SECTION 23: NOTICES
All notices except as otherwse provided in this Agreement shal be in writig, 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 certfied or registered mail and retu receipt requested.
Notices PacifiCorp Seller
All Notices PacifiCorp Cedar Creek Wind, LLC
825 NE Multnomah Street Portland,701B Winslow Way E
OR 97232 Bainbridge Island, W A 98110
Att: 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~summitpower.com
Duns: 00-790-9013 Duns: 83-297-9483
Federal Tax ID Number: 93-0246090 Federal Tax ID Number: 80-032653 1
34
Cedar Creek Wind, LLC-Five Pine
Notices PacifiCorp Seller
All Invoices:Att: Back Offce, Suite 700 Att: (accounting(ßsumitpower.com)
Phone: (503) 813 - 5578 Vici Hall, General Accounting
Facsimile: (503) 813 - 5580 Manager (vhall(ßsummitpower.com)
Phone: [phone]
Scheduling:Att: Resource Plang, Suite 600 Attn: (tcameron(fsumitpower.com)
Phone: (503) 813 - 6090 Thomas CameronFacsimile: (503) 813 - 6265 [phone]
Payments:Attn: Back Office, Suite 700 Att: ( accounting(fsumitpower.com)
Phone: (503) 813 - 5578 Vici Hal, General Accounting
Facsimile: (503) 813 - 5580 Manager (vhall(fsumtpower.com)
Phone: [phone]
Wire Transfer:Ban One N.A.BNK: Wells Fargo
To be provided in separate letter from To be provided in separate lettr fromPacifiCorp to Seller Seller to PacifiCorp
Credit and Att: Credit Manger, Suite 700 Att: Richard W. Burkhardt
Collections:Phone: (503) 813 - 5684 (rburkhardt(fsumtpower.com)
Facsimile: [phone] Chief Financial Offcer
Phone: [phone]
With Additional Att: Pacifi Corp General Counsel Att: Richard W. Burkhardt
Notices of an Phone: [phone] (rburkhdt(ßsummitpower .com)
Event of Default Facsimile: [phone] Chief Financial Officer
or Potential Phone: [phone]
Event of Default Davis Wright Tremaie LLP
to:1201 Thid Avenue, Suite 2200
Seattle, WA 98101
Attention: . Scott MacCormack
Facsimle No.: [phone]
The Pares may change the person to whom such notices ar addressed, or their addrsses, by
. providing wrtten notices thereof in accordance with ths Section.
REOF, the Pares hereto have caused this Agreement to be executed
es as of the date fist above wrttn.
Title: Director, Short Term Ongination
and QF Contracts
35
Cedar Creek Wind, LLC-Five Pine
EXIBITA
DESCRIPTION OF SELLER'S FACILITY
(Seller to Complete)
Seller's Facilty consists of 11 wind tubine 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-2.3-10l
Number of Phases: Three
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: 25,300 kW at or above rated wind speed and below cut-out
speed
Maximum Facilty Delivery Rate: _24,920 kW at PacifiCorp GoshenSubstation at 345 kV ,
'.1Maxum GIA Delivery Rate 151,800 - intataneous kW (combined with the other Cedf
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 Five Pine is approximately 60 kW. Cutout loads would be infequent and not
concurent with stadby loads.
Location of the Facilty: The Facilty is located in Bingham County, Idaho. The location is
more parcularly described as follows: 430 17.841' Latitude, 111058.747' Longitude WGS84..
Locations of each tubine tower relative to other quaifying facilties owned by Ceda Creek
Wind showig Cedar Creek Wind's compliance with the spacing requiements 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 -2.3-101. PacifiCorp maintains the power cure in its fies pursuant to a Non-Disclosure
Agreement between PacifiCorp and Seller
A-l
Cedar Creek Wind LLC-Five Pine
EXHBIT A - Attchments
1. Cedar Creek Wind Far Site Map
2. Distace Between Wind Turbines of Adjacent Qualifying Facilties
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Distance Between Wind Turbines of Adjacent Qualifying Facilities
Date 11/16110
The table beow lists the distnc ben turbnes in se Qualiing
Facilities. The distance ar base on the tuine lotions defined by Wind
Logics in their Turbne Laou Revion 5 documen dated 11/16/10.
Nort PointCOyote HiH
Turbne Turne .Dian
T6 T14 5632.2'
T6 T15 5356.1'
T6 T16 568.0'
T7 T14 6161.2'
T7 T15 5610.9'
T7 T16 5594.1'
T7 T17 5595.3'
T11 T15 631.3'
T11 T16 5842.6'
T11 T17 541.7'
Coyoe Hilllatnake . Canyon
Turbine Turbne Disnc13T25558.5'
T36 T23 607.0'
T36 124 6504.5'
T37 T2 5378.4'
T37 T23 569.7'
T37 T24 5898.8'
Noh Point/st RIgeTurbTurbinDitanc
T12 T25 5799.5'
T12 T27 537.2'
T12 no 541.6'
T12 T32 5358.6'
stR~aeatake canyonTurTurbneI Dinc
T34 T40 1948.3'
St D Ridgeiv Pine
Turbne Turbine Distnce
T48 T29 546.8'
T48 T31 558.3'
T48 T35 5921.7'
Verified by:
. --_._.~_._._-- - ..._- '.~.. . A
Cedar Creek Wind, LLC-Five Pine
EXHIBITB
POINT OF DELIVERY /PARTIES' INTERCONNECTION FACILITffS
(Seller has provided the following single line drawing of the Facility intercònnection facilities
including metering points used to calculate Net Output and any tranmission facilities on Seller's
side of the Point of Delivery.)
The Metering Point and the Point of Delivery is the PacifiCorp 345kV bus at the Goshen
substation.
The Project will be shared by a 34.5kV-345kV collector substation. Each project will have a
34.5kV breaker that will connectto a common 34.5kVbus. The bus will 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-Five Pine
EXHIBIT B - Attachments
1. Substation Meterig One-Line Diagram (Drawing No. 00E001)
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Cedar Creek Wind, LLC-Five Pine
EXHITC
REQUID FACILITY DOCUMNTS
Qualifyng Facilty Number from FERC: QFIO-537-000
The following Documents are required prior to delivery of any output from the Facilty:
Generation Interconnection Agreement
Agreement permittg Seller access to shaed interconnection facilties
Property rights required to maintain and operate the Project in accordace 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 Admstration Determation of No Hazd
Bingham County Special Use Permt
Crossing agreements with paries other than PacifiCorp Transmission
C-l
Cedar Creek Wind, LLC-Five Pine
EXHIBITD
SUBSEQUENT ENERGY DELIVERY SCHEDULE
Five Pine Wind Pro.iect
Scheduled Monthly
Energy Delivery AvekW/mo
Janua
Februar
March
April
May
June .
July
August
September
October
November
December
TOTAL:
Planed Outages. Seller will provide a Planed Outage schedule anualy not to exceed 150
hours per year.
D- 1
Cedar Creek Wind, LLC-Five Pine
EXHITE
START-UP TESTING
Required factory testing includes such checks and tests necessary to determine that the
equipment systems and subsystems have been properly manufactured and installed, fuction
properly, and are in a condition to permt sae and effcient sta-up of the Facilty, which may
include but are not limited to:
1. Test of mechanical and electrcal equipment;
2. Calibration of all monitoring instrents;
3. Operating tests of all valves, operators, motor staers and motor;
4. Alars, signals, and fail-sae or system shutdown control tests;
5. Point-to-point contiuity tests;
6. Bench test 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 instaled and adjusted, fuction
properly, and are capable of operating simultaneously in such condition that the Facilty is
capable of continuous delivery into PacifiCorp's electrical system, which may include but are
not limited to:
1. Turbine/generator mechancal rus and fuctionality;
2. System operation tests;
3. Brake tests;
4. Energization of trsformers;
5. Synchronizing tests (manual and auto);
6. Excitation and voltage regulation operation tests;
7. Auto stop/sta sequence;
8. Completion of any state and federal environmental testing requirements; and
9. Tests required by manufactuers) and designer(s) of equipment.
For wind projects only, the followig Wind Turbine Generator Installation Checklists are
required documents to be signed offby Manufactuer or Subcontract Category Commissioning
Personnel as par of the Commissionig and stp testng:
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-Five Pine
EXlBITF-l
MOTIVE FORCE PLAN
WIND SPEED DATA SUMMARIES & HOURLY WIND PROFILE
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5
EXHITF-2
ENGINEER'S CERTIFICATION
FIVE PINE
I hereby certify that I am a License Profesional 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 windproject. .
Having reviewed, and in reliance i upon the Western Energy Group, LLC, Cedar
Creek, Idaho, Site Visit Sunuar reprt dated September 30, 2010, and Cedar Creek
Wind Fan Turbine Layout Analysis dated November 16, 2010, prepared by Wind
Logics on behalf of Cedar Creek Wind, LLC, I hereby certify:
ARIES IN EXHIBIT F-l ARE ACCURATE;
Ro
(2) THAT THE AVERAGE ANNAL NET OUTPUT ESTIMATE is 74,111,491
KWH PER ~ rN EACH FUL. L. CA. LENDAR YEAR OF THIS AGREEMENT
BASED O)l'tHjYOTJVE FORGE' LAN IN EXHIBIT F-l ;// ;/~ .,'t .' .'
(3) THAT THE FACILITY, UNDER AVERAGE DESIGN CONDITIONS, LIKELY
WILL GENÉRÂ TE NO MORE THAN 10 aMW IN ANY CALENDAR MONTH./''/ ~. .~'¡'/
~.¿:¿./) .-'
Rob Looper, State oliah~a1 Engineer # 8155
"
i No indepedent verification of the raw wind data contained in summary form in Exhibit F-I has been
conducted.
Exhibit F-2 Engineer's Certtfcaie Five fine (2).doc
Cedar Creek Wind, LLC-Five Pine
EXHBITG
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 during an On-Peak Hour in May of 2011
equals $60.24IMWh (the 2011 anual 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
$48.92IMWh.
Table 1: Sample calculations for non-levelized On-Peak Conformng Energy in 2011: Purchase
Price = (anual rate * monthly On-Peak multiplier) - wid integration cost.
Conforming
Energy Calculated Purchase
Annual Rate On-Peak Wind Price for 2011 On-
for 2011 Hour Integration Peak Conforming
Month (perMWh)Multiplier Cost Energy (per MWh)
Janua $60.24 103%$6.50 $55.55
Februar $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
Augut $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: Purhase
Price = (anual rate * monthly Off-Peak multiplier) - wind integration cost.
Conforming
Energy Calculated Purchase
Annual Rate Off-Peak Wind Price for 2011 Off-
for 2011 Hour Integration Peak Conforming
Month (per MWh) Multiplier Cost Energy (per MWh)
Januar $60.24 94%$6.50 $50.13
February $60.24 97%$6.50 $51.93
March $60.24 80%$6.50 $41.69
G - 1
Cedar Creek Wind, LLC-Five Pine
Conformng
Energy Calculated Purchase
Annual Rate Off-Peak Wind Price for 2011 Off-
for 2011 Hour Integration Peak Conforming
Month (per MWh) 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-Five Pine
EXHIBITH
Seller Authoriation to Release Generation Data to PacifCorp
H-1
WESTERN ENERGY SUMMIT. POWER
May 7, 2010
Pacificorp
Attn: Kenneth Huston
825 NE Multnomah, Ste. 1600,
Portland, Oregon 97232
RE: Cedar Creek Wind, LLC PacifCorp Tranmission
Dear Mr. Huston:
Cedar Creek Wind, LLC hereby voluntaly authorizes PacifCorp's Transmission business unit
to share Cedar Creek ~ind, LLC's generator interconnection information and generator meter
data with market fuctiòn employees of PacifiCorp, includig, but not liited to the those in the
Commercial and Tradig group. Ceda Crek Wind, LLC acknowledges that PacifiCorp did not
provide it any preferences, either opertional or rate-related, in exchange for ths voluntar
consent.
Sincerely,~~~~
Dana C. Zentz, P.E.
Vice President
Sumit Power Group, Inc.lCedar Creek Wind, LLC
[phone] (Offce)
[phone] (Mobile)
Cedar Creek Wind, He
701 Winslow Way E., Suite B
Bainbridge Island, WA 98110
1
206-780-3551
fax: [phone]
CONFIDENTIAL
Cedar Creek Wind, LLC-Five Pine
ADDENDUML
STATION LOAD, LOSSES, and NET OUTPUT
ALLOCATION ALGORITHM FOR THE
CEDAR CREEK WIND, LLC PROJECTS
Ths Addendum L is hereby made a par of, and clarifies certain terms in, the Power Purchase
A. greement between Cedar Creek find, LLC relating to FIVE PINE, and PacifCorp
("Agreement") entered into the '2i)l4day of ~ 2010. Capitalized terms not defined
herein shall have the meaning set forth in the Agreement. Ceda 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 Hill, Five Pine, Steep
Ridge, Nort Point, and Rattlesnake Canyon) separate, Idaho small wind Quaifying Facilties
(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 Delivery ("Shared InterconnectionFacilties"). .
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 Facilty and the Point of Delivery (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 Auxilar Load and
Losses), the Paries do agree as follows:
A. Billig 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 (ala Facility 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 tota station auxliar load and losses for the Shared
Interconnection Facilties for Cedar Creek Projects i = 1 to 5 whenever such total
load and losses exceeds tota generation output.
P ALL¡ = the allocated share of P ALLT for Project i as determined by multiplying PALLT by
NR¡ ând dividing by NRT.
NR¡=
NRT =
PALLT =
L-1
Cedar Creek Wind, LLe-Five Pine
OP¡ = for a given integration interval, 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 Shaed Interconnection Facilties. For any integration interval
durg which any energy is delivered to a Project from the Shared Interconnection
Facilties, such delivered energy is accumulated in a separate meter register and
does not decrement the register used to meaure accumulated OPi. Therefore OPi is
by definition always greater th or equa to zero, and in the event the meter records
OP¡ less than zero, OP¡ shal be deemed to equa zero.
i
OPT the sum of all OP¡ (i = 1 to 5).
NOT = for a given integration interval, the tota 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 10-minute intervals), adjusted for any
transformation losses between the meter and the Point of Delivery. For any
integration interval during 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 defition always
greater than or equa to zero and in the event the meter records NOT less than zero,
NOT shall be deemed to equa zero.
NO¡ = the net energy sold to PacifiCorp by Cedar Creek Project i durng the integration
interval.
SALLT = the tota of all station auxilar load and losses for the Shared Interconnection
Facilties for Cedar Creek Projects (i = 1 to 5) when NOr is positive.
SALL¡ = the allocated share for Ceda Creek Project i of SALLT.
2. Calculations
Calculations shall be reconciled and settled monthy. Calculations shall be based upon raw data
gathered from specified meters using a meterg integration interval of 5, 10, or 15 minutes at
PacifCorp's election to match the metering instlation PacifiCorp specified ("integration
interval"). Calculations shall be rounded to the nearest kilowatt-hour in the fina step.
(a). When Total Generation Output -:= Station Auxilary Load and Losses
When, for any integration interval, the tota of all OP¡ Project output amounts of energy among
all Cedar Creek Projects (OPT) is less than or equal to the tota station auxliar load and losses
for the Shared Interconnection Facilties, the meters at the Point of Delivery wil accumulate the
Utilty Supplier's delivery of purchased energy, P ALLT, to supply such net total load and losses
in a meter register tht is separate from that which accumulates NOT and NOT shall equal zero or
if negative, be deemed to equal zero. The "Utity Supplier" shall be the utility providing retail
electric servce at the Facilty (Rocky Mountan Power). PacifiCorp shall have no obligation to
serve any of the Cedar Creek Projects' retal electric needs absent a separate written agreement
with PacifiCorp and then only with the permission of Seller's Utilty Supplier. None of the costs
associated with provision of retail electric service to Seller shall be borne by PacifiCorp.
L~2
Cedar Creek Wind, LLC-Five Pine
(b). When Total Generation Output ~ Statin Auxiliary Load and Losses
When, for any integration interval, the total generation of energy among all Cedar Creek Projects
is greater than the tota station auxilar load and losses for the Shared Interconnection Facilties,
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 interval (SALLT) is allocated to each Ceda Creek Project in proportion to its generation
output (OP¡) in the same integration interval to determine NO¡ by the formulae:
Let SALLT = ( OPT - NOT) and
SALL¡ = (SALLT) * (OP¡ / OPT)
The Net Output energy sold by each Project i is then determined as:
NO¡ = (OP¡ - SALL¡) and substituting for SALL¡ ;
NO¡ = NOT * (OP¡ / OPT J
n. Limitation ofPacifiCorp Purchase Liabilty. PacifiCorp's total purchase obligation to the
Cedar Creek Projects shall at no time exceed tota 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 purchaed from all the
Cedar Creek Projects at the Point of Delivery by PacifiCorp equas NOT.
C. PacifiCorp Right to Offset. In the event PacifiCorp determineS it has underpaid one or
more Cedar Creek Proj ects (due to metering error or otherwse) and, as a result of underpaying
one or more Cedar Creek Projects, has overpaid Seller, PacifiCorp may adjust Seller's futue
payment(s) accordingly in order to recaptue 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 terms and conditions set forth in this Addendum L, PacifiCorp may,
upon thirty days written notice, cancel all Addendum L agreements. In the event PacifiCorp
cancels this Addendum L in accordace 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