ML19343A337

Stipulation Incorporating Encl License Conditions W/O Admission of Violation to Antitrust Laws

ML19343A337
Person / Time
Site:	Comanche Peak
Issue date:	09/12/1980
From:	Bouknight J, Stahl D CENTRAL & SOUTH WEST CORP., TEXAS UTILITIES ELECTRIC CO. (TU ELECTRIC)
To:
Shared Package
ML19343A334	List: ML19343A337
References
ISSUANCES-A, NUDOCS 8009170235
Download: ML19343A337 (17)

Text

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UNITED STATES OF Ah.RICA NUCLEAR REGULATORY COMMISSION BEFORE THE ATOMIC SAFETY AND LICENSING BOARD In the Matter of TEXAS UTILITIES GENERATING ) NRC Docket Nos. 50-445A COMPANY, et al. ) 50-446A

)

(Comanche Peak Steam Electric )

Station, Units 1 and 2) )

STIPULATION It is hereby stipulated and agreed by and between West Texas Utilities Company, Central Power and Light Company, South Western Electric Power Company, Public Service Company of Oklahoma.and Central and Scath West

< Corporation (jointly "CSW") and Texas Utilities Generating g Company (" Applicant"), as follows:

1. Applicant hereby consents to incorporate into the license for Coranche Peak Steam Electric Station, Units 4

1 and 2, the conditions set out in the attached document, entitled " Proposed License Conditions for Comanche Peak Steam Electric Statior., Units 1 and 2" (hereinafter "these conditions").

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2. CSW is of the opinion, which it will communicate to the Board, that the licensing of Comanche Peak Steam Electric Station, Units 1 and 2, under these conditions will not create or maintain a situation inconsis-tent with the antitrust laws or the policies thereunder in accordance with the standards set forth in Section 105 of the Atomic Energy Act and will withdraw their request that the NRC conduct a hearing pursuant to Section 105c of the Atomic Energy Act in these dockets.

3. CSW will not seek, or take any position in support of, any modification of these conditions in this hearing (without prejudice to the right of CSW to seek a further hearing before the NRC pursuant to paragraph 3.D.2(1)(a) of these conditions), and Applicant shall not withdraw its consent to incorporat. ion of these conditions into the license for the Comanche Peak Steam Electric Station, Units 1 and 2, notwithstanding the outcome of any '

further proceedings herein. To the extent that CSW parti-cipates further'in the proceeding, it will defend these conditions should they be challenged, but this obligation of CSW shall not extend to any issue raised by it in any proceeding initiated by it under paragraph 3.D.2(1)(a) of these conditions.

4. Applicant denies that its past conduct and/or its proposed activities under the license for Comanche Peak Electric Station without these conditions are inconsistent with the antitrust laws in any respect, and i

nothing. in the Stipulation or in these concitions constitutes any admission or evidence of inconsistenc-j with or violation of any law or regulation, state or fedr,ral.- Nothing in this Stipulation or in these conditions coastitutes any evidence against Applicant or any admission by Applicant as to any issue in this or any other proceeding.

CENT AND SOUTH W ST CORPO TION By ~

/

l TEXATU ILITIES GENERATING COMPANY By /

MbN b x)

Dated: September 12, 1980

f -(FINAL)

LICENSE CONDITIONS FOR COMANCHE PEAK STEAM ELECTRIC STATION NUCLEAR UNITS NOS. I AND 2 D. (1) The following definitions apply to perograph 3.D.(2):

(c) " Applicants" mecns severo!!y cnd jointly Texcs Utilities Generating Company, Dollas Power & Light Company, Texcs Electric Service Company, Texas Power & Light Company, Texcs Utilities Company and each otle subsidicry, affiliate or successor cortgany now or hereafter engaged in the generation, transmission and/or the distribution of electric power in the State of Texcs.

(b) " North Texas Area" means the following Texas counties:

Anderson, Andrews, Angelina, Archer, Bastrop, Baylor, Bell,

Borden, Bosque, Brown, Burnet, Cherokee, Cicy, Coke, Collin, Comanche, Cooke, Coryell, Crane, Culberson, DcIlcs, Dawson, Deltc, Denton, Ecstland, Ector, Ellis, Ercth, Falls, Fannin, Fisher, Freestone, Gcines, Glasscock, Grayson, Henderson, Hill, Hood, Hopkins, Houston, Howard, Hunt, Jack, Johnson, Kaufman, Kent, Lamar, Lamposas, Leon, Limestone, Loving, Lynn, Martin, McLennan, Midland, Milcm, Mitchell, Montague, Nacogdoches, Navarro, Nolen, Polo Pinto, Pcrker, Pecos, Rains, Reagan, Red

River, Reeves, Rockwall, . Rusk, Scurry, Schockelford, Smith, Somervell, Stephens, Sterling, Torrent, Terry, Tom Green, Travis, Upton, Von Zandt, Ward, Wichite, Wilborger, Williamson, Winkler, Wise, Wood, and Young.

(c) " Entity" mecns an electric utility which is a person, o private or public corporction, a governmental agency or authority, c municipality, a cooperative, or en association owning or operating or contractually . controlling, or proposing in good faith to own or operate or contractually control, facilities for gene.ation of electric power and energy; provided, however, that as used in porogranhs 3.D.(2)(c), 3.D.(2)(b), 3.D.(2)(g), 3.D.(2)(i), 3.D.(2)(j)(c) ,

and (b), 3.D.(2)(k), 3.D.(2)(l) and 3.D.(2)(m), " Entity" means on electric utility which is e person, a privote or public corporation, a governmental ogency or authority, a municipality, a cooperative, or an cssociation owning or operating, or proposing in good faith to own or operate, facilities for generction, transmission and/or distribution of electric power and energy.

(d) " Entity in the North Texcs Area" mecns on Entity which owns or operctes facilities for the generation, transmission and/or distribution of electric power in any cree within the North Texcs Arec.

(e) " Bulk Power" mecns the electric power and/or electric energy supplied or made available at transmission or subtransmission voltages.

2 (f) " Costs" means cil appropriate operating cnd maintenance expenses and cll ownership costs where applicable.

(g) The terms " connection" and " interconnection" cre used interchangeably.

(2) The Applicants defined in Peregraph 3.D.(l)(c) cre suject to the following antitrust conditions:

(c) The Applicents shall afford cn opportunity to porticipate in the Comanche Peck Steam Electric Station, Units I cnd 2, for tne term of the instant license, or any extension or renewal thereof, to any Entity (ies) in the North Texcs Area making a timely request therefor, through a recsoncble ownership interest ir. such unit (s) on recsoncbie terms and conditions and on a bcsis thct will fully compenscte Applicants for their costs. It is understood that any request received prior to December I,1973, shcIl be deemed to be timely. In connection with such participation, the Appliccnts also will interconnect with cnd offer transmission service os mcy be required for delivery of such power to such Entity (ies) at a point or points on the Applicents' system on a bcsis thct will fully compensate the Applicents for their costs including a recsoncble return on investment. Notwithstanding the December I,1973 date cppearing hereincbove, the Applicants' offer of participction in Comanche Peck, Units I and 2, to Tex-La Electric Cooperctive of Texcs, Inc. shcIl not obligate the Applicants, by virtue of such offer, to offer en opportunity to pcrticipate in Comanche Peck, Units I cnd 2, to any other Entity.

(b) The Applicants, cs long cs they are members of the Texcs

. interconnected Systems (TIS), shall support reasoncble requests by Entities in the North Texcs Area having generating ecoccity for membership in TIS. The Applicants shcIl ciso propose and actively support, os long cs they are members thereof, the creation of one or more additional classifications of TIS membership based on non-discriminatory criteric to cfford access to dctc, studies and recommendations to all Entities in the North Texas Area who desire membership. Tne Applicants shcIl also support requests by qualified Entities in t ie North Texcs Area for membership in cny or operating organization of which other electricareutility the Applicents membersplanning (other than one involving only the Applicents). The Applicants shall share information with other Entities with respect to, and shall, with other such Entities through cny electric utility planning organizutions (other than one involving only the Applicants) of which the Appliccnts cre members, conduct and/or participcte in joint studies and planning of future generation, transmission and related facilities; provided, however, this condition shall not obligate the Applicants to conduct or participate in such joint studies or joint plcnning unless (1) the studies or planning are requested and conducted in

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good faith and are based on reasonably realistic and reasonably i

complete dato and projections, (2) the studies or planning are reasondly justified on the basis of sound engineering principles, (3) appropriate protection is accorded proprietary or other confidentic! business and financial infe'mation, and (4) the costs i for such studies or planning are allocrited on c fair and equitable basis.

3 (c) The Applicants will connect with, coordinate reserves, and sell, '

purchese or exchange emergency and/or scheduled maintenance bulk power with any Entity (ies) in the North Texas Area on terms i

that will provide for the Applicants' costs, including a reasoncble return on investment, in connection therewith and allow such Entity (ies) full access to the benefits of such reserve coordinction.

(d) Emergency service and/or scheduled maintenance service to be provided by each party shall be furnished to the fullest extent 7 available from the supplying party and desired by the party in 1 need. If requested, . Applicants shcIl exchange maintenance i schedules with any Entity in the North Texcs Arec. The Applicants and each such Entity (ies) shall provide to the other emergr y service and/or. scheduled maintenance service if and when c. uilcble to the extent they con do so without unreasonably impairing service to their customers including other electric systems to whom they have firm commitments. Any curtailment or refusal to provide such emergency and/or scheduled maintenance service shall be on a non-discriminatory basis.

(e) The _ Applicants and the other party (ies) to a reserve sharing arrangement shcIl from time to time jointly establish the minimum reserves to be installed and/or provided under contractuoi crrangements as necessary to maintain in total a reserve margin sufficient to provide odequate reli_ ability of power supply to the interconnected systems of the parties in accordance '

, with good industry practice as uveloped in the area. Unless i otherwise agreed upon, minimum reserve requirements shall be "

. calculated as a percentage of each party's estimated net peak load demand (taking into occount firm sales and firm purchases). No party to the arrangement shall be required to maintain greater reserves than the percentage which results from the aforescid coleulation. The reliability of power delivered into TIS-ERCOT over de csynchronous connections sho!! not be treated differently by the' Applicants, for purposes of spinning _ond installed reserve cciculctions and requirements, then would be the cose if such power origincted within TlS-ERCOT. _ Outages on de asynchronous connections sho!! be treated by the Applicants the some os losses of generation within TIS-ERCOT. The Applicants agree to support

, the adoption of principles involving de asynchronous connections

; contained in this naragraph within any TIS or ERCOT

organization.

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. . (f) The parties to such a reserve shoring crrangement sho!! provide such amounts of spinning reserves cs mcy be equitable and adequate to avoid the imposition of unrecsonsle demands or the other party (ies) in meeting the normal contingencies of operating its (their) system (s). However, in no circumstances shcIl such reserve requirement exceed the installed reserve requirement.

(g) Interconnections with any Entity will not be limited to low voltages when higher voltages cre requested and cre availcble from the Applicants' instciled facilities in the crec where c connection is desired, when the proposed arrangement is found to be technically and economically feasible. Control and telemetering facilities shcIl be provided as required for safe end prudent operation of the interconnected systems.

(h) Interconnection and coordinction agreements shall not embody any restrictive provisions pertaining to intersystem coordination.

Good industry prcetice es developed in trie creo from time to time (if not unreasonsly restrictive) will satisfy this provision.

(i) The Applicents shcIl participcte in and facilitate the exchange of bulk power by transmission over the Applicants' transmission facilities between or cmong two or more Entities in th: North Texcs Area with which the Applicants are connected, cnd between cny such Entity (ies) and cny Entity (ies) outside the North Texcs Area between whose facilities the Applicants' transmission lines and other transmission lines, including any direct current (csynchronous) transmission iines, form a continuous electricci pcth; provided, that (i) permission to utilize such other trcnsmission lines hcs been requested by the proponent of the arrangement, (ii) the arrangements reason sly. con be accommodated from a functional and technical standpoint and (iii) any Entity (ies) requesting such trcnsmission arrangements shall have given Applicants reasonable advance notice of its (their) schedule and requirements. Such transmission shall be on terms that fully compensate the Applicants for their costs including a recson6 e return on investment; provided, however, that such transmission services and the rates to be charged therefor shcIl be subject to cny reguictory agency (ies) having jurisdiction thereof.

The Applicants shall not refuse to provide such transmission service merely because the rates to be charged therefor are the subject of dispute with such Entity. The Applicents shcIl not be required to enter into any crrcngement which would unrecsonably impair system relichility or emergency transmission capacity, it being recognized that while some transmission may be operated fully looded, other transmission may be for emergency use end operated either unloaded or porticily loaded. (The foregoing applies to any Entity (ies) to which the Applicents may be connected in the future as well es those to which they are now connected.)

(j)(c) The Applicants shall include in their planning and construction programs sufficient transm:ssion ccpocity as required for the transactions referred to in parographs (i) and (k), provided any Entity (ies) in the North Texas Area gives the Applicants sufficient advance notice as may be necessary to occommodate its (their) requirements from a fu .ctionc! and technical standpoint onc tst such Entity (ies) fully compensates the Applicants for their costs including c recsoncble return on investment. The Applic=nts shcIl not be required to constmet transmission facilities if construction of such facilities is infeasible, or if such would unrecsonably impcir system relisility or emergency transmission capacity. In connection with the performance of their obligations above, the Applicents shcIl not be foreclosed from requiring a reasoncole contribution in aid of construction or from making arrangements for coordincted construction of future transmission lines such that each of the parties to the transaction would own on interest in or o segment of the transmission addition in proportion to its shore of the cost of the oddition. Any such contribution mode in aid of construction or ownership interest shcIl be p ,perly credited in determining any wheeling charges. If the App? cents engage in joint ownership of transmission lines with any o.her Entity, they shall not refuse to engage in similar transactions in comparable circumstances with other Entities, subject to the provisions limiting the Applicants' obligations above.

(jXb) Applicants shcIl provid ether Entities with reason 61e access to any future interstate interconnection facilities which Applicants may own, on terms and conditions comparable to the provisions of porograph D.2(i) hereof, and subporograph (c) of this pcrograph.

(k) The Applicents shc!!, upon recsonste advance notice, sell full cnd partic! requirements bulk power to requesting Entities in the North Texas crea having, on the date of this License, non-oggregated generating ecpocity of less than 200 MW (including no genercting capacity) under reasonable terms and conditions, whien shall provide for recovery of Applicants' costs, including a reason 61e return on investment. The Applicants shcIl not be required to make any such sole if they do not have avcilable sufficient bulk power or adequate transmission to provide the requested service or if the sale wou!d impair their cbility to render odequcte and relisle service to their own customers or their ability to discharge prior commitments.

(1)(c) in connection with the performance of their obligctions herein and subject to the provisions of this paragraph, the Applicants will not

' disconnect from ~or refuse to connect their then-existing or ,

proposed facilities with the facilities of cny Entity, used or I proposed to be used for the transmission of electric energy in interstate commerce by reason of the interstate chcrocter of such I

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fccilities, and the Applicants will not prevent any Entity with which they mair.inin connection from establishing, maintcining, modifying, or utdizing a connection with facilities used or proposed to be used for the transmission of electric energy in interstate commerce by recson of the interstate chorocter of such facilities, provided that, anything in these License Conditions to the contrcry notwithstcnding (but subject to ocrogrcph 1(b) and 1(d) below), any Entity seeking to estcblish, maintain, modify or utillze any conne: tion which could effect the nonjurisdictionc! stctus of the Applicants under the Federcl Power Act shcl! hcve filed cn application with and used its best efforts to obtain en order from the Federal Energy Regulatory Commission, applicable to the Applicants under Sections 210, 211 and 212 of such Act, receiring the estcblishment, mcintencnce, modificction or utilization of such connection. In the event thct en Entity files on appl lcetion pursucnt to this subparagraph, the Applicants ogree that they will not unrecsonably oppose ar1y such application. In the event such application is denied by a valid order of the Federal Energy Reguictory Commission, any continuing refusal by the Applicents to estchlish, maintcin, modify or utilize such connection with such Entity shcIl be subject to review by the NRC in accordcnce with the Atomic Energy Act of l*54, es cmended, and the ru!es and

. reguictions thereunder, to . deterrnine whether any such refurm!

would create or maintain c situction inconsistent with the entitrust laws or the policies thereunder in occordance with the standcrds set Erth in Section 105 of such Act; provided thct cil factual determinctions by the FERC on any cost or system relichility rec:,cn(s) for any such refusal sha!! not be subject to redeterminction by the NRC. The burden of proof will bt on the Applicants in such NRC proceeding.

(I)(b) Applicants shcl! not enter into or maintcin any agreement or understcnding with any other Entity (ies) to refuse to deal with another Entity (ies) with the purpose of maintaining an exemption from jurisdiction under the Federal Power Act, and in the event thct Applicants refuse to mcke on interconnection with or choose to disconnect from any Entity (ies), such decision and/or action by the Applicents will be undertaken unilaterally, not jointly, cnd without consultation with any other Entity (ies), proviced, however, that after Applicants decide to undertake such action, they may notify any offected Entity.

(i)(c) in the event thct en Entity files on replication pursucnt to subparog oph (c) of this porogrcph solely oy recson of Applicents' desire to mcintain their exemption from jurisdiction uncer the Federci Power Act, Applicants agree to pay such Entity's reasoncble expenses in connection with such coplice ' ion and the ensuing proceeding if, provided, however, that Applicants shc!! not be required to pcy for cny expenses of such Entity if that Entity's J/ This obligation shall not apply to the expenses ' the Centrol & South West Corporation or Houston Industries or any of their respective subsidic-les, including,, but not limited to, the expenses of Centrol & South West Corporation and any of its subsidicries incurred in FERC Docket No. EL79-8.

7 opplication . is denied by FERC for reasons advocated by Appliconts at FERC, and provided further, that Applicants shall not be required to pay for any expenses of such Entity which that Entity would have incurred had it not filed on opplicction solely by recson of Applicants' desire to mcintain their exemption from jurisdiction under the Federo! Power Act.

(IXd) Nothing in inese License Conditions shcl! impcir the right of the Department of Justice or any other Entity, public or private, to file on antitrust action in any Federal Court in the event any Applicant refuses to establish, maintain, modify or utilize any connection with any Entity (ies), provided, that nothing herein shc!!

' preclude any Applicent from raising any legal or equitcble defense thct may be availcble to it.

(m) Applicants ogree to use their best efforts to amend any agreements with c!! Entities to ensure that such ogreements are not inconsistent with porograph 3.D.(2)(1)(c) and (b) above.

(n) The Applicants will, in occordance with applicable law, ellow ownership pcrticipction in future nuclect generating fccilities which they mcy construct, own, and operate in the State of Texas on conditions similar to these License Conditions.

(o) Applicants shcIl use their best efforts to modify the Offer of Settlement filed in FERC Docket No. EL79-8 to include each of the undertokings set forth in the letter agreement among Applicants, Centrol & South West Corporation, Houston Li

& Power Company and the FERC Staff dated September 1980; Ji,ghting Applicants shall thereciter use their best efforts to secure opprovc! thereof bv the FERC, and shcIl obide by any valid order (s) of the FERC issued pursuont to the Offer of Settlement.

Nothing herein shall preclude the Department of Justice from instituting or intervening in any proceeding at FERC, including FERC Docket No. EL79-8, and from presenting such arguments and evidence that it deems oppropriate.

(p) The foregoing conditions shall be implemented (i) in a manner consistent with opplicable Federal, state and local statutes and 4

regulations and (ii) subject to any regulatory agency having jurisdiction. Nothing herein sho!! preclude the Applicants from seeking on exemDtion or other relief to which they mcy be entitled under oppliccble low or shcIl be construed cs c waiver of their right io contest the oppliccbility of the license conditions with resper: to any fcctual situction.

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September 11, 1980 John A. Cameron, Jr., Esq.

Federal Energy Regulatory Commission 825 North Capitol Street, N.E.

Roor 8712 Washington, D.C. 20426

Dear Mr. Cameron:

In order to avoid any possible misunderstandings, we wish to confirm our understanding of the FERC Staff's settle-ment demands in Docket No. EL79-E.

The FERC Stsff will, on the date set for filing comments, a#firmatively support the Offer of Settlement tendered by Centz c1 and South West Corporation (CSW), et al., in Docket No. EL79-8, dated July 2E, 1960, (herein " Offer of Settlement")

and withdraw the proposed Transmission Service settlement Agreement sent out under your cover letter of July 3,1980, if the following modifications are made to the Offer of Settlement by CSW, Texas Utilities Company (TU), and Houston Lighting & Power Company (HL&P). However, it is understood that no provision of the Offer of Settlement, as modified, shall be construed to affect the rights or obligations of the FERC Staff or any party hereto in any future proceedings at the FERC, to investigate or contest any rate filing made pursuant to the following paragraphs. The FERC Staff makes it clear that this letter is w2thout prejudice to any FERC Staff request that additional relief be ordered in Docket No. EL79-8 against electric utilities other than CSW, TU and HL&F.

" System" as used herein means, respectively, (a) HL&P, (b) all TU operating companies, (c) CSW operating companies in the Electric Reliability Council of Texas (ERCOT), (d) CSW operating companies in the Southwest Power Fool (SWFF).

(1) Rates and service shall be determined from time to time in accordance with the procedures of Sections 205 and 206 of the Federal Power Act, whether or not otherwise applic- l able, by virtue of agreement of the parties pursuant to section y.

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. W w Ju "QDO W UUU f\ lAlM' U _s 211(d)(3) of the Federal Power Act, as amended. Each System agrees to file rates with the FERC, deemed to be rate increase filings pursuant to Section 205(e) of the Federal Power Act, for wheeling power to, from, and over the proposed direct current (DC) interconnection facilities which will:

(a) roll in each System's alternating current l

( AC) and DC transmission costs, if any, with l the result that any utility using any Syster's l AC or DC lines, or both, for wheeling power in interstate commerce will pay a rate designed to recover all costs and a reasonable return on both the AC and DC investment and related operating costs; (b) be the same for that System regardless of whether the interstate movement comes over the North or the South interconnection; (c) be the same for that System regardless of,the distancethet involved System'sof the actual transmission over lines; (d) or may, dirtinguish between types of service (e.g. economy, interruptible, firm) and length of service (e.g. short term to multiyear);

(e) be filed at the FERC at least one yehr before the DC liner go into operation, under the

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terms and conditions in paragraph 13 of the proposed order contained in the Offer of Settlement, which means that the initial rate will go into effect subject to refund, if the Commission orders a hearing on the rates:

(f) not include rates for wheeling of power solely within ERCOT-TIS which does not involve

! the proposed DC interconnection. However, i the CSW ERCOT operating companies, being subject to FERC jurisdiction, will file,_

within three months of a final FERC order in Docket No. EL79-8 no longer subject to judicial review, a proposed wheeling tariff, to be collected subject to refund, applicable to whee 2 ~.g within ERCOT-TIS for utilities in ERCO2 w2th less than 1500 Mw load, consistent with this paragraph (1) and with paragraph (2) below; i

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0 ,a e u (g) be designed by each System to recover all of its costs and a reasonable return for the use of its AC and DC facilities; (h) be a single rate for each type of service over the TU System's combined transmission facilities, the CSW ERCOT System's combined transmission facilities, and the CSW SWFP System's combined transmission facilities.

Thus, a wheeling customer would pay a single rate to each such System for a transaction utilizing all or any part of the combined transmission facilities of the TU System, the CSW ERCOT System, and the CSW SWFP System, respectively. The single rates will be based upon the transmission costs per kw of system

- load for each company within the TU System,

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the CSW ERCOT System and the CSW SWPP System, respectively, which costs shall be multiplied by the ratio of power flow over each such company's transmission system to the power flow over all or any part of the combined transmission facilities of the respective System, such flows being determined by a composite of typical wheeling transactions over the respective Systems. The single rate for each System shall then be determined by i

adding together the resulting weighted trans-mission costs for each company within that System (as calculated per the preceding sentence), to which appropriate transmission losses shall be added; (i) be in lieu of any " contract path" or similar theory for determining which utility or utilities paid for within ERCOT-TIS are entitled to be wheeling. The method for determining the amount of kilowatts or kilowatthours for bi] ling purposes shall be the calculated load flow through each System with and without the proposed wheeling using the TIS computer programs and data base, as revised from time to time to reflect current and projected systems. Whenever any System is requested to wheel power, such System will provide a load flow analysis at cost within two working days of the request or upon payment of costs, whichever is later. (It is all Systems' belief that a single load flow study would suffice for all potentially affected companies s

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• ]D $j'$Uaf5)Q 1% O in ERCOT-TIS, since the data base is common and coordinated regularly with all relevant systems.); and -

(j) provide for interstate economy interchange and emergency power transmission service, which may be requested on an hour-to-hour basis, in accordance with good utility prac-tice in the area.

(2) Whenever any System has been requested to wheel, it will respond with an answer to the request (including an explanation of any denial of service) as follows (dating from the within completion of the load flow study for wheeling ERCOT-TIS,

' by CSW SWIF ): or from the date of a request for wheeling (a) for transmission service lasting for one or more years, within thirty days, or the first working day after thirty calendar days; and (b) for transmission service lasting for less than one year, within two working days.

(3) As part of their respective wheeling rates filed pursuant to paragraphs (1) and (8), HL&P and CSW will each reserve 15% of the capacity in their respective DC intercon-nection facilities for firn. puwer wheeling (herein "the reservation") pursuant to the following:

(a) the reservation shall be made for utilities in ERCOT and SWPF having loads less than 500 MW (herein " qualified utilities");

(b) the reservation shall continue for five years after each facility goes into commercial operation at its rated capacity. At the end of the five year period,.HL&P or CSW, or L

both, may file pursuant to the procedures set i forth in the first sentence of paragraph' (1),

supra, as a change in service, to delete the reservation for qualified utilities; (c) CSW ccrpanies shall make reservation capacity

' available for firm power wheeling in eacn of their DC interconn;ction facilities, so long as there is capacity available in either of

' them; when.either of the DC interconnection facilities is out of service, CSW shall not be obligated to make reservation capacity

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. D associated with that facility available on the other interconnection facility; (d) HL&P and CSW will solicit requests for reser-vation capacity from qualified utilities one year before the respective DC interconnection facilities go into commercial operation, and at one year intervals thereafter for reservatio.

capacity which has not been previously committed.

HL&F and CSW, respectively, may utilize any unused portion of the reservation capacity until a timely request for wheeling is made by a qualified utility; reservation capacity may be used on a firm basis from year to year or less if, after notice, capacity is not con-tracted for by qualified utilities; and (e) The reservation in this paragraph (3 ) is reduced by the amount of capacity purchased pursuant to paragraph (4)(a), below.

(4)(a) Superseding paragraph 1(f) of the Settlement Agreement (Attachment 1 in the Offer of Settlement filed in Docket No. EL79-8 by CSW et al, dated July 28, 1980) in its entirety, the capacity reserved for qualified utilities pursuant to paragraph (3) of this letter agreement will be available for purchase by qualified utilities at the depreciated original cost thereof, until either (1) the reservation of capacity has been terminated or (2) the opportunity to participate in ownership of additional DC capacity to be installed has been tendered as set forth below, whichever comes first. Purchase of reservation capacity by qualified utilities in the South intercon-nection shall be on a pro rata basis from both agree;CSW and HL&P unless HL&P and CSW otherwise (b) Whenever planning is undertaken to increase the capacity of the Interconnections, but at

- intervals of no more than every three years after June 30, 1983, until June 30, 2004, electric utilities in ERCOT and SW7? Will be given the opportunity to participate in the p3 anning of increases in the capacity of the Interconnections and of participating in the ownership of any incremental capacity added,

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provided again that each party that wishes to participate pays its pro rata share of the capital costs of constructing the Interconnec-tion which it wishes to participate in and undertakes to pay its pro rata share of the costs of operating and maintaining that Interconnection and agrees further to be bound by the terms and conditions of the Agreement between Ownerc of the Interconnec-tions; and (c) This understanding is without prejudice to the right of either CSW or HL&P to sell DC capacity which is not subject to paragraph (3).

(5) The FERC order will be a final order, not an order contingent upon the issuance of any order by a court or other regulatory agency. However, some mechanism to reopen the FERC proceedings in the event that orders in other forums, including, but not limited to, SEC Admin. Proc. File No. 3-4951, cannot be obtained, is acceptable.

(6) Recognition of any environmental guidelines and periodic reports on the progress of construction and com-pliance with environmental requirements, not affecting the substance of the Order, will be included.

(7) subject to reasonable contingencies, such as possible delays under paragraph (6) supra and force majeure, CSW and HL&P will commit to cause the DC capacity to be installed and operational within 5 years of the date of a final FERC order, no longer subject to judicial review. It is understood that HL&F's commitment and CSW's commitment are several, not joint.

(8) The CSW SWPP operating companies shall file the single rate for wheeling within SWPP, as provided in paragraph 1(h) for utilities in SWFP with less than 1500 F.w load, within three months of a final FERC order in Docket No. EL79-8, no longer subject to judicial review. It shall go into effect subject to refund, if the Commission so orders. The CSW SWPP single rate filing shall be consistent with subparagraphs 1(a),

(c), (d), (g) and (h), and with paragraph (2). The proposed

,, rate to be filed pursuant to this paragraph (8) shall not apply to existing agreements for wheeling or purchase and resale service which either PSO or SWEPCO may have with other utilities.

)/' _-

If you will confirm this Staff settlement demand by executing a copy of this letter below, the underoigned counsel, tive cli,nt, e

each being duly authorized to do so by his respec-accept your settlement demand.

By our respective signatures, we all represent that this letter, together with the Offer of Settlement previously i filed in this docket, constitutes the final settlement between the FERC Staff, CSW, TU, and HL&F.

m Cou sel for*

Houston Lighting & Power Company

& A

_Counctil for Texas Utilities Company and the Operating Companies thereof Ut Counsel for /

Central & South West Corporatien and the Operating Companies thereof Confirmed:

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i un'sel fo'r the pRCStaff Accord:

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C0 u s e  !

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