ML20126K010

Settlement Agreement Between Util & Cities of Anaheim, Banning & Riverside,Ca.Cities Will Amend Petition to Intervene by Withdrawing Objections to AEC Licensing Proceedings.Ltrs Encl

ML20126K010
Person / Time
Site:	San Onofre
Issue date:	08/04/1972
From:	Elizabeth Crawford, Drewry W, Dutton J, Lewis B AFFILIATION NOT ASSIGNED, ANAHEIM, CA, RIVERSIDE COUNTY, CA, SOUTHERN CALIFORNIA EDISON CO.
To:
Shared Package
ML20126J991	List: ML20126J988 ML20126J993 ML20126J997 ML20126K001 ML20126K005 ML20126K010 ML20126K012 ML20126K018
References
NUDOCS 8105080261
Download: ML20126K010 (64)

Text

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lh APPENDIX 7 SETTLE'GNT AGREEMENT THIS SETTI.EMENT AGZ-"CNT is made and entered ints by and between S'0UTHERN CALIFORNIA EDISON COMPANY (Edison), and the cities of ANAHEIM, BANNING AND RIVERSIDE '(Cities), and relates to those matters which have been the subject of negotiations for a considerable time and includes claims relating to the-matters involving the parties presently pending before regulatory commissions, before the U. S. Court of Appeals for the District of Columbia and before the Department of Justice.

As a result of those settlement discussions, but subject to conditions set forth in this Settlement Agreement, and with the agreement that each condition of the Settlement Agreement is in cons,ideration and support of every other condition, the parties have agreed as follows:

ARTICLE 1 - DISPOSITION OF PENDING PROCEEDINGS 1.1 Cities will withdraw their objections and cooperate with Edison to attain the prompt and early disposition of Federal Power Commission Docket No. E-7618 so as to permit the rates filed therein as modified hereunder'to become final.

1.2 Cities will withdraw with prejudice their intervention in Federal Power Co_ mission Projects 67 and 120 having to do with relicensing of certain hydroelectric projects of Edison.

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4 APPENDIX 7

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cion in California Pu'elic Utili:ies Cc-mission Certifica:e Applicatica :so. 52976 having to do with the proposed T..ird "ide:;-Vincent High V:ltage Tr  : is:i:n line.

1.4 Cities will amend their petiti n to intervene to with-draw their objections in the Atomic Energy Commission Licensing Proceedings Docket Nos. 50-361 and 50-362 relating to the licensing of San Onofre Units 2 and 3. Upon Edison's request,, Cities will advise the Atomic Energy Commission and the Department of Justice that the Cities have settled their claims relative to San Onofre on the basis of the proposal in this Settlement Agreement. Such advice may be used by Edison to the end that the Department of Justice will recommend to the Atomic Energy Commission that the granting of a license to Edison and San Diego Gas & Electric Company for San Onofre Units 2 and 3 will not create or maintain a situation incon-sistent with the antitrust laws. Nothing contained in this paragraph shall limit the Cities from otherwise participat-ing in the licensing proceedings. 1 1

1.5 Cities will dismiss their appeal in cities of Anaheim, Riverside and Banning, California vs. Federal Power Ceu. mis- l l

sion, pending before the U. S. Court of Appeals for the l District of Columbia, as No. 71-1652.

Cities have, in the pending appeal, taken the position that Edison was not lawfully entitled to file unilaterally

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APPENDD( 7 wuu une c cus.u z u ,. - . --..a=.... ...-- .... . --- -- -----

l and to modify the ciscounts amplicable to Ci:ies which l

were the subject of Edison's filing on er ab:u:

March 23, 1571 (which baccma effa;;ive 3 i;-  : : rsfund on . November 14, ~.971); Edison's ;;; :i:n . :h:: i:s said i filing was lawful in all respects, that it was not con-tractually prohibited from making such filing and that the additional revenues now being collected under such rate increases and modifications are neither unjust nor unreasonable. It is Edison's further position that, if the Cities were to prevail in such litigation and Edison were required to await expiration of the terms of the present contracts with the Cities and were thereafter required to make a new filing with the Federal Power Commission and were not permitted to place such rates >

into effect before the regular processing, including a ,

new five months' suspension, it has been estimated by i Edison (utilizing the Cities' lead-growth projections) that Edison would be exposed to loss of revenues from Cities in excess of $5 million, in addition to poten-cial costs arising out of litigation of other claims by ,

Cities. In c onsideration of Cities dismissing such appeal, releasing other claims, and agreeing that, except

&s otherwise provided in Paragraph 2.4 of this Agreement, Edison will not be prohibited by contract or otherwise ,

fram making future unilateral rate filings under

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APPENDD( 7 Sec:icn 205 of -he redera' . P:,:c: A::, nn: i:ies ;n:s -

-taking, as aforesaid, to cooperate in per=icting the said

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this Agree =ent, to bec me final, c_sen ar.e=3 --- re; .. .

Cities $3,100,000 as of Ss;tember ',  : -2. Idiser frr::

agrees to pay to the Cities , . as of September 1, 1972. :ne

. sum'of $25,000, which Edison believes is significantly less than it would necessarily incur in any defense of Cities' antitrust claims.

- 1.6 The'S3,125,000 sum included in Paragraph 1.5, shall ,

be paid promptly upon approval or acceptance by the Federal Power Commission of this Settlement Agreement and upon the tenders for filing specified in Paragraph 5.6, and shall be distributed as follows:

Anaheim $1,715,000 Riverside $1,402,000 Banning S 8,000 Said sums will be adjusted for prepayment or post-payment at an interest rate of 1/2% per month compounded monthly.

1.7 Cities shall make -no claim based upon allegations of ,

past anti-competitive activities against Edison arising out of Edison's participation in, or non-participation in, or receipt of power from the Navajo Project or the Navajo-

. Four Corners Project, but Cities reserve their rights to s N otherwise seek participation in or otherwise obtain power from the Navajo Project, i ,

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APPENDIX 7

.A..~1CLI : - FJ.TI M.4TTER5 2.. 1 : son azrees to provide service a: 220 kV and :he C : es of Ananeim and Riverside herebv commi: :: :ake ,

.... ice c: such higher v:1: age as 2::.. __ n::-_;;ry f;cilities and rights of way can b. pr:: red :nd the i necessary construction completed. ' The necessary details involved in determining the arrangements for each of the 220 to 66 V substations to be constructed, and the timing and responsibility for providing such facilities are as set forth in Exhibit G.

2.2 Edison agrees to modify and request the Federal Power Commission to accept for filing and make effective as provided herein concurrently upon the acceptance or approval of this Settlement Agreement, a modification of Rate Schedule l

R-2 applicable to Cities as filed in Federal Power Cm.uission Docket No. E-7618 relative to the Cities to increase the voltage l discount effective November 14,1971, to 10 cents per kilowatt j l

for service taken at 33 kV, 20 cents per kilowatt for service .

I taken at 66 kV and 35 cents per kilowatt for service taken at 220 kV. Edison further agrees that in the event the City of Banning receives service prior to November 14, 1977, at 115 kV in accordance with Exhibit G, the rate schedule on file at that time under which Banning is served will be further modified effective when such service co==ences i

to provide for a voltage discount of 30 cents per kilowatt i

for service taken at 115 kV. The rate schedules as modified 5- '

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...n: in 2:::rcance with this Se::lemen: A g r = =.:. ... .

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.n= par:1es agree that :he c:~.:4;= eie:.-...c . . _ ~ . ~ . l

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;'t in Paracraph 2.2. a'

2 un:i'. ": verb =r 1 . j 1977, and that during that pcried, nene of the oar:ies l

will contest the voltage discounts.

2.4 Edison will make no new rate filings before the Federal Power Commission concerning full requirements service which will effect prior to June 1, 1973, an increase in the level of rates applicable to resale customers taking such full requirements service. Edison may file new or increased rates pursuant to Section 205 of the Federal Power Act, which races Edison may request to be made effective, subject to refund, allowing for full statutory suspension, as early as June 1, 1973, and Cities may oppose or seek the modification of any such rates except as limited by this Settlement Agreement.

2.5 New services under terms and conditions as set forth in Article 4 of this Agreement shall be made available to the Cities by Edison, subject to regulatory authorization.

2.5 With the exception of the R-2 Rate Schedules currently in effect as modified herein, nothing herein shall be con-strued as a waiver by any of the Cities of their right to oppose future rate filings of Edison, except that each i

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APPEND!X 7

'. errces not te cr :ic any such rate fi'.inz on ene basis

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AH C.E - ;E'_ EASE 3.1 Ine C :ies hereby release Edison, its directors, officers, e=ployees, agents and attorneys from any and all claims and demands, in connection with the subject matters involved in the allegations of Cities in the legal or administrative proceedings enumerated in 3.2 below, of whatever nature, .

anticipated or unanticipated, known or unknown, arising out of, or by virtue of, any conduct of Edison, occurring prior to the date of this Settlement Agreement, which conduct allegedly breached any contractual relationship or allegedly violated any of the laws or regulations of the United States Government, or any agency thereof, or the laws or regulations of the State of California, or any of the several states or political subdivisions thereof, or any agency thereof.

3.2 The aforesaid claims and demands relate to the matters involving the allegations of Cities in those legal or administrative proceedings known as:

. 3.2.1 Federal Power Commission Docket No. E-7618, a l rate filing of Edison.

3.2.2 Federal Power Commission Projects No. 67 and 120, having to do with relicensing of hydroelectric projects of Edison.

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APPENDIX 7

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3.2.4 Atomic Energy Cc= mission Licensing Pro-ceeding Docke: Ecs. 50-361 and 50-362, relating to the San Onofre Nuclear Generating Station.

3.2.5 City of Anaheim, et al, vs. Federal Power Commission, U. S. Court of Appeals, D. C. Circuit Case No. 71-1652.

3.3 Edison hereby releases Cities, their officials, officers, employees, agents and attorneys from any and all claims and demands of whatever nature, anticipated or unantici-pated, known or unknown, arising out of or by virtue of any conduct of Cities occurring prior to the date of this Settlement Agreement in connection with the subject matters of, or documents provided in, or activities related to, the legal and administrative proceedings listed here in Paragraphs 3.2.1 through 3.2.5.  ;

3.4 Each of the undersigned expressly waive the. provisions i 1

1 of Section 1542 of the Civil Code of the State of i I

California, reading as - follows: )

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1 APPENDIX 7

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.sterially affe::ed his se::le=ent with the ]

debtor."

ARTICLE 4 - FURTHER AGREEMENT 4.1 Edison agrees, subject to regulatory authorization, to rake available to Cities the following services and will take the steps reasonably necessary to seek to obtain such authoriration:

4.1.1 Combined dispatch of power resources, sharing of reserves , transmission service, purchase and sale of capacity or energy and other necessary supplemental services, as part of integrated operation of City-owned resources with those of Edison in accordance with Exhibit A attached. A definitive agreement reflecting Exhibit A attached, with which the parties agree to abide, will be entered into between Edison and each City at an appropriate time in the future.

. 4.1.2 Partial Requirements Service, under terms and conditions to be determined as set forth in Paragraph 5.8, to supple =ent and back up other 9

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APPENDIX 7.

power rescurce: aatainec oy ..e ..._c: ....

----v~?' i '- =dison's resource? s? set i:r::-

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4.1.3 Transmis sion service on Ecis ;;

ne: work in conjunction with in;es;6:cd operaticns under the ter=s and conditions set forth in

- Exhibits C and D attached. Such transmission service is based on using Edison's existing and planned transmission network and is therefore

-limited to power flows to the City. If a City requests specific transmission service both to and from a City and'if such service is technically feasible, Edison will provide such service and will develop and tender for filing appropriate rates and charges.

4.1.4 Transmission service outside the 220 kV network but within Edison's certificated area on a point-to-point basis in conjunction with integrated operation under terms and conditions set forth in Exhibits C and I attached. Such transmission service is based on using Edison's existing transmission system and is therefore ilmited to' power flows to the City. ,

If a City requests specific transmission service both to and from a City and if such service is technically feasible, Edison will provide such service and will develop and tender for filing appropriate races and charges.

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to make mutually sat.3.m.. cry arrange:2n:2 .. ,

trcnsmit the City-c.nsi p:wer ever facili:ics existing at the time such trans=ission service is requested and where such facilities are owned solely by Edison to Edison's 220 kV network when a City requests specific service. Any such service will be provided under Edison's transmission rate schedules or under rates, terms, and conditions to be agreed upon, and, in the event of disagreement, Edison shall develop and tender for filing with the Federal Power Ccamission, an appropriate rate schedule and service agreement for

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such service, and Cities may oppose or seek the modification thereof.

If City desires transmission of power over facilities outside dison's certificated service area, where such facilities are interconnected with, but not solely owned by, Edison, then City shall be responsible for negotiations with.che appropriate owner or owners of such facilities for such trans-mission. Edison shall cooperate with City in its efforts to obtain such transmission of power.

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APPENDIX 7 0.1.6- Sncuac C;;1e5 o3;ain an en;;..=cenC Lo say ..

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Cent of Edison anc Cities 41.. LOJ sXceed Ediscn's present entitlement (present".y s::ima:ed cc be 327 megawatts) and provided further that Edison remains entitled to an amount at least equal to the ccmbined entitlement of Cities.

4.1.7 Participation on a mutually agreeable basis in new generating units initiated by Edison in which Edison is a joint participant with other utilities or generating agencies. Such resources shall be integrated in accordance with those principles set forth in Exhibit A concerning integrated operation. Participation is also offered in the ownership of San Onofre Units 2 and 3 on the basis set forth in Exhibit F, provided that Cities commit themselves :c such participation not later than November 1, 1977. Participation is neither offered to nor waived by the Cities in existing plants or contractual arrange =ents or in future power sources that will be owned solely by Edison or in contractual arrange =ents related to such power sources.

4.2 Edison agrees that no agreenent between it and any other electricel system er syste=s will be sonstrued by i

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and :he service ar.s. 2 cn: c:n.in;..: d h: :in, .:

s2) :he 2nterin; in : crr-._: :::.:

and Edisen or any ::Fer 5;s:en :: ::.ieve :he ci-fe=' -

Obje::ive hereunder :o have opper: uni: Les of cen:::::ing for, utilizing, and developing, independent power sources.

Edison will cooperate with Cities in achieving the Cities' objective, but nothing in' this Paragraph 4.2 shall inhibit Edison from exercising its rights , and performing all the terms and conditions of all lawful agreements to which it is now a party.

4.3 Cities will, promptly upon approval or acceptance by the Federal Power Commission of this Settlement Agreement, and upon the tenders for filing specified in Paragraph 5.6, return to Edison all documents, and all copies of such documents, including summaries thereof where possible, in the possession of Cities, their attorneys or agents, (except copies of documents attached to Cities' filings or pleadings in proceedings listed in 3.2), which Cities, their actorneys or agents have obtained from Edison or have made in the {

course of discovery proceedings in Federal Power Commission l

Docket No. E-7618, and will refrain from making or retaining other copies thereof. Such documents, summaries thereof, l

or information contained in such documents shall not be 1

used against Edison by Cities, their accorneys or agents in any way, including use in any other legal proceedings. l

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APPENDIX 7

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the parties agree in advance pertain to cost o f s e rvic e ,

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.'.T:CLE 5 - On~ERAL CONDIT!CNS l

5.1 The making of this Settlement Agreement or sne  !

- acceptance of it by any regulatory co= mission shall not be deemed in any respect to constitute a finding by such commission or an admission by any of the Cities or by Edison that any allegation or contention urged by the other parties in the various proceedings now pending or as to any of the matters covered by this Settlement Agreement is true or valid.

5.2 This Settlement Agreement is conditioned expressly upon the approval or acceptance by the Federal Power Cannission of all of its terms and conditions, including the permitting to become effective, consistent with Article 2, of the rate schedules as specified in Section 5.5. " Approval or acceptance" as used in this Settlement Agreement refers to a final order of the Federal Power Commission which is no longer subject to review.

5.3 Contracts setting forth rates for the services con-templated herein shall be tendered for filing with the Federal Power Commission and such contracts and rates shall be subject to change, except as expressly limited 14 -  ;

1 _ _ , _ -

APPENDIX 7

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-"-e"---  :- Section 205 of the Federal Power Act.

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rhe Rules of Edisen

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: :h: TJisr::

7:wcr 00mmissi n, as such Kules may be .:fified fr:-

time to time upon filing by Ecison pursuant to Section 205 of the Federal Power Act.

5.5 Concurrently with the submission of this Settlement Agreement to the Federal Power Commission and consistent with Article 2, Edison will tender Exhibits G and H for filing as rate schedules with the request that they be accepted for filing and allowed to go into effect concurrently upon approval or acceptance of the Se,ttlement Agreement.

5.6 Immediately upon approval or acceptance by the Federal Power Commission of this Settlement Agreement, but not prior to closing of Docket E-7618, Edison will tender to the Federal Power Commission for filing as rate schedules Exhibit C, D, and E hereto. Cities will not oppose such filings made consistent with this Settlement Agreement.

5.7 Edison will tender to the Federal Power Commission for filing as a rate schedule each of the definitive Integrated Operation Agreements negotiated pursuant to  !

Exhibit A when such agree =ents are executed, but nct prior to the conclusion of the current resale rate 15 -  ;

APPENDD( 7

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c  ;; i .J f:ra :f : :e ra:ed Operari - A:resmen:,  ::

ac I:-:hibi: A shall be a:: ached, and Ci:ies rese ce

-;.c right to intervene, oppose and seek modificacicn :f the proposed for= of contract and the parties agree that the matter may be consolidated for hearing and decision upon timely motion in any Edison rate case involving .

. resale rates subsequent to.this Settlement Agreement.

Neither party will take a position which does not-conform to the agreed upon principles in Exhibit A.

5.8 The parties have agreed that partial requirements service should be available to Cities from Edison but have not resolved their differences as to the appropriate races, terms and conditions for such service. A copy of the contract rate schedule as proposed by Edison without concurrence by the Cities (Exhibit B, Partial Requirements Service) is attached hereto. It is the Cities' position ,

that the disparity between the all requirements and partial requirements rates as presently proposed, will prevent the Cities from developing their cwn resource ,

program; and further that the applicability of Edison's

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all requirements race schedules should be extended te partial requirements service, or these rates should be otherwise established, so as to enable the Cities to i.

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. ..;. 7.... . . . . . . . _ _ . . ._<= ge. _.;_._, .:.73,333: yng have :he e' -seuirerents and rar:ial recuirements rare matters :: :: idated fer hearing and decisien. Parties agree that any filing by Edison of a rate for partial require =ents service, such as Exhibit B, may be consolidated for hearing and decision (with such rate cases). Absent a prior. agreement, the parties agree to relegate to litigation and decision in such subsequent proceedings the determination of proper rates, terms and conditions for partial requirements service.

5.9 Nothing herein shall be construed as a waiver by any of the Cities of their rights to file complaints under the Federal Power Act as to any matter herein except as set forth in Paragraphs 1.5 and 2.3 and Article 3.

t 5.10 Commitments made and services offered herein shall be subject to interruption or curtailment in case of force majeure.

5.11 If filing with any public agency is necessary to implement the load shedding or load curtailment program referred to in Exhibit A of. this Agreement, Edison shall file in accordance with statutory require =ents.

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APPEN0!X 7

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this Acreement shall not constitute the dedication of the

.. curiic or to re ::.ar par:), n:: a:ic;; the s;atus

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5.12 This Agreemen: is cade upon the explicit understand-ing that it constitutes a negotiated settlement and that all offers of settlement and discussions relating thereto are and shall be privileged and shall be without prejudice to the position of any party. It is further agreed that the parties shall not be considered as necessarily agree-ing with any method of cost-of-service determination, or  ;

design of rate schedule, or the application of any rule of law. This Settlement Agreement and such additional agreements as may be required to implement this Agreement are submitted on the same explicit understanding and on the further condition that in the event any appropriate ce=nission does not by order accept this Settlement Agreement, it shall be deemed withdrawn and shall not constitute part of the record in any proceeding or be used for any other purpose.

5.14 Upon any breach of this Agreement, any party may seek whatever remedy it deems appropriate including,.but not limited to, rescission or damages. Breach by a City, however, shall not entitle Edison to discontinue any of the services offered hereunder which Cities are taking as of the date of the breach.

i j

APPENDIX 7

. . . s . . : . . .: n : cr=.. :e _. : : .u . :;

i..a State or Calirornia, or of Uniteo states receraA taw, as 5'. 13 The rirr

: ries here:: rerreren: that they have been appropriately authorized to enter in:o this Agreer.ent on behalf of tce party for whom they sign.

Executed this fourth day of August 1972.

SOUTHERN CALIFORNIA EDISON COMPANY By /s/ Wm. C. Drewry Vice President & Assistant to the Preside Attest: J. C. Bobek, Assistant Secretary CITY OF ANAHEIM By /s/ Jack C. Dutton Attest: Dene M. Daoust CITY OF BANNING By /s/ Earle W. Crawford Attest: Norma J. Brenton CITY OF RIVERSIDE By /s/ Ben Lewis Accest: Virginia J. Strohecker i

Approved as to Form

/s/ John Woodhead Riv. City Attorney 19 -

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APPENDIX 7

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IN Er.: ___

4 cpE;ATION

~. OEnGr*. .ITECCin" 1.1 The parties to the Integrated Operation Agreement shall be Southern California Edison Co=pany (Edison) and the City of (City) .

The principles set forth herein shall form the basis

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for a definitive Integrated Operation Agreement.

1.2 In order to better meet the power requirements of the respective parties and obtain operational economies on their respective syste=s, Edison and City agree to integrace their power sources. To accomplish this, Edison agrees to provide dispatching services for sources owned by, or under the control of, the City and to schedule operation and maintenance of such sources in the same manner as if they were owned or controlled by Edison.

1.3 Edison and the City will participate in joint planning in order that each party will have available to it sufficient information as to the future load, transmission and power supply plans of the other and in order to make joint power flow studies as related to future plans. The City and Edison shall each appoint a representative to freely exchange information and determine procedures regarding planning, engineering ,

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APPENDlX 7 l

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~.......

. . _ . . .u.'....

ny p::sennai, n::icns, _'_......: , inf:r z:icn cri I coopera:icn reasenably requ_ rec f:: planning, cpert:in:,

dispatching, maintenance and billing activities. The City will provide Edison with information needed to schedule deliveries from City's sources and to provide Edison with complete data concerning generation by City-operated units.

1.5 The Integrated Operation Agreement shall become effective when signed by both parties and shall remain in effect until canceled by one party giving the other not less than 10 years' advance written notice of such cancellation, except that such agree-ment may be mutually terminated at any time. City may cancel the Integrated Operation Agreement and Exhibit A on 30 days' written notice, if no City sources of generation have been integrated into the combined resource plan. In the event Edison files (under Section 205 of the Federal Power Act) a change in rates which affects Integrated Operation and which creates a substantial detriment to City, City may cancel the Integrated Operation Agreement upon five years ' written notice given not later than 90 days after such change is final.

A-2 [

APPENDIX 7 m . ...:.. ... --.:.:.... j i

i 1

- - -- - . . . . :. .  : ..:. .. .... --n.

l or c:qu .. . ...... .. . ... . .

.~ .; . . . . . .. .. :t c '. '.

or a art :f th: el:-:tri::*. 'r: uir: :r t- :r its sys:er.

To integrate such source c :ources int: Ec son's system, j 1

City shall, at the earlies t practicat'.c - L:e , infor= l Edison in writing of such desire. City shall show by the use of historical growth trends, future forecasts I and other available supporting data that such sources will meet all or a part of its requirements in the reasonably foreseeable future. Sources from which City may obtain generation include, but are not limited to the following:

By construction of generating facilities 2.1.1 either solely or in participation with parties other than Edison.

2.1.2 By purchase of power frc= third parties.

2.1.3 By participation with Edison in new generating units initiated by Edison in which Edison is a joint participant with other l

, a j

- utilities or generating agencies; provided u .

that Edison's and City's shares shall be in y

proportion to the relative size of Edison's and City's historical loads as determined from an average of the last six annual peak de= ands for each system, the latest of which i!

A-3 a ,__ .m_ , _,

APPENDIX 7 is for :.e vear recesin. :ne - . _ . c_rin.

rhi:P :he Cit: r- '-- -- ete" 7e-~'ciS?!'en, be de:erninci :: -he .earis: :.:'_  :::En:.

Edison sha*.1, as so:n si pr_...:...e, ini;r.

City of Edison's plans f:r i:s par:icipati:n in such projects.

2.2 Edison agrees to use its best efforts to integrate power sources planned by the City into the resource plan developed for the combined systems, provided:

2.2.1 Sufficient notice of the estimated date of firm operation is given to Edison in order that adequate and reliable power supplies for the combined systems may be provided in a timely manner; 2.2.2 Sufficient notice is given to Edison of the date when City must make a definite ce=mic-ment to proceed with the construction or acquisition of such power source; 2.2.3 Such sources are of appropriate size, type, reliability and design, and have appropriate operating characteristics, for integration; 2.2.4 Such sources do not exceed the City's system requirements for the reasonably fore- 1 seeable future, unless City and Edison =utually

(

A-4 l

1

+ -

APPENDIX 7 1;rsi :: . ...;  :.. ... . .: . . . . .i desirable; Such s0urces ".?:0.0 r. : :id2r & 7::0

^

... 3 s ource propos ed b; Ifis: '

'- * :urrInc resource planning f:r ::e ::n':ined sys: ens and for which Edison has made substantial financial or other commitments toward its ~

construction, unless City and Edison mutually agree that City's proposed power source is desirable; 2.2.6 Such sources are compatible with (a) resources planned for the combined systems, (b) the resource plans submitted annually by Edison to the California Public Utilities Connission under its General Order 131, and (c) other resource plans periodically submitted to regional agencies and organizations, which plans shall include the future power sources of the City previously agreed to be integrated into the combined systems; and 2.2.7 Agreement between the parties is reached regarding transmission facilities required to

integrate the City's proposed source into the combined systems.

2.3 Within 60 days of the later of (a) receipt by Edison of the information on a proposed City power A-5

. . - . - .. .- - - _ - . , _ . . _ . _ , - . - . _ ..~. - _ _ . . _ - . _ . . - - - . . . . _ _

APPENDEX 7 a-.--= == a:-  :- - ; ,e p .- n a n-  ;- -a p.-- ,.

. . -. .:.iz z i:n f a c i'_ i:is; m; ' ( ;.._

... _._.,,  :. e r. c . _ ir.:: r:: ;. :; , ..:.: .:

:he 7:ur:e f pcwer r:p: sed 5- Ci:" ce:s :he cri eria se: for:'.- in See:icr 2.~. In the e'cen: :ht:

Edison inferms the City tha: such proposed source of power does not meet said criteria, Edison shall, upon request by the City, make available for examination by the City the plans and specifications of Edison's comparable existing and planned sources of power.

2.4 As soon as practicable after Edison has informed City pursuant to Section 2.3 that the source of power proposed by the City can be integrated into the resource plan for the combined systems, City shall enter into appropriate transmission service arrange-ments with Edison for such source. After City has made a definite commitment to Edison to proceed with the construction or acquisition of such source of power, City shall take all steps necessary to make available the proposed source of power by the estimated date of firm operation.

2.5 In the event Edison is unable or unwilling to construct such new transmission facilities as may be required to integrate the City's source of power into the combined syste=s, City shall have the right to construct transmission facilities to provide such A-6 i

. . . ..- . . . . , , . . , . , , - . - - . - . . . . , - . - . . ~.

APPENDD( 7

. -=- -_;-- . , - -;--a ge - . ,a ---a--.. as

._&ities; provided :ha: 5 _ : .;

......_, . : 2. . .

...-_. - . .1 c i an.cre in:c eitnc. 2 a; rect n: i:r

- -- e r re d --z s:i ns er an nteprt:ed Opera:irns A--== en: vich Idisrn. Edisen will agree to enter in:: arrangements with such other u:ili:ies substan-tially in accord with its existing interconnection agreements or principles set forth herein for Integrated Operations.

2.6 City shall take all steps necessary to make the proposed source of power available in accordance with Section 2.4 above within the time necessary to proceed with the project involved. If, under any circumstances , the City decides to abandon its involvement in the proposed power source, Edison shall have the right to assume ownership of the source and the responsibility for its completion upon reimbursing the City for all costs incurred by City in connection with such pcuer source.

2.7 The parties will support each other in obtaining any necessary authorizations and regulatory approvals for new sites, rights-of-way and facilities associated with transmission services and new sources of power included by agreement in the combined resource plan.

3. Citv-Owned and coerated Generation 3.1 City shall design and construct i:s sources of e

A-7 '

APPENDIX 7 p....-.... . . . . . . . . . . . . . . . . . . - . . . . . .. 2 :2 r*

c:pable :f :.risrnine - r c manner cr= parable to Edis:n's eat ::= ;f concrc;i:n.

. Ci:7 --. . . .. a:  :. - - . : : :. - . . 7. :: :i=e to ti=e

n desir b': uni:

h:rt:::ris:ier and design criteria bea. ing on u:.it reliability and usabili:y so that the

-parties have a reasonable period of time to exchange views on such characteristics and criteria. Such exchange shall not create any responsibility on the part of the requesting party or anyone else as to the adequacy or capability of such source and is only intended to enable the requesting party to evaluate the reliability of sources which are to be integrated with its own sources of generation.

3.3 The Rated Capability of a source of generation, including a purchase from a specific generating unit owned by a third party, shall be the City's share of the unit's maximum level of net generation that can be continuously maintained (with only ordinary maintenance and adjus tment) under physical, regulatory, legal, warranty, or other restrictions at any given time. The Rated Capability shall be determined by operating tests of the type normally used by Edison to establish the capability of its generating units.

The Rated Capability of a source of purchased pcwer '

will be deemed to be its maximum firm rate of delivery under the purchase contract.

i A-8

- _-- u_ _ c= _ , . - . . __ .__ ,- ,

APPEND!X 7

- - -2..... . . . _ . .: ......:._..... .-_o9,7,4

. .. a 2:_rce cf ..s e. .;;i: ._  :) ::. .... --:e when

. . :; ._: ::::n3cr_:=. . :. .. : :.. ..;r.:...  ;.:ures

.uiptent are :: -

--=re-ir- o--:-- erusly i- 5":P ::ndici:r cPz  : --

r :::e is carsble :f

tinuous delivery int: the inte; rated systems at its Rated Capability. Such demonstration shall include satisfactory completion of all necessary start-up and performance tests which would be performed normally on similar Edison sources. Such date shall, for the purposes herein, be considered to be the date of firm operation.

3.5 City shall, at Edison's request, install and maintain at City's expense automatic generation control equipment compatible with Edison's automatic generation control system on those sources of City's generation which have been designated by Edison.

Edison will not request such equipment to be installed on City sources unless Edison would install such equipment on the source if Edison owned it.

4 Interrated Oceration and Maintenance 4.1 Af ter City acquires a source or sources of power, City and Edison shall at all times each contribute a proportionate share of the reserve require =ents for the combined systems. City's contribution shall be dee=ed to be a percentage of the then effective Rated i

I

'l A-9 l

4 APPENDIX 7 i

7-, :2 , .__ ..- - , ,-..e. 7

. Idison fcr ..a ..___--- . :.L:

_:.a - .::.. : _:i*:s yesrs , : :. - - :: . ~ . - - - .~

l i- th = e e- '

- '.i:b such er:  :- ir :: :: ~.

Scid avers;e sh:1; he de:ernin2: :: : c.3 narrei:

0.01 percen:.

4.2 City shall be responsible for the operation and maintenance of the sources of generation owned and operated by it.

4.3 City shall make its sources of power available for scheduling by Edison to meet the cambined require- ,

ments of Edison and City. City's sources will not be scheduled by Edison for operation in excess of l l

s their Rated Capability except under energency condi- ,

tions. Edison shall inform City in advance when such operation is anticipated and the duration thereof. In the event that an emergency arises where such advance notification is not possible, Edison shall inform the City as soon as possible after such operation has  !

occurred. Edison shall schedule City sources in accordance with good electric utility practice.

4.4 City shall coordinate with Edison the schedules

~

for maintenance and refueling work on City's sources l s

of power. City shall perform all such work on sources l solely owned by it in accordance with such schedules, and shall not, except in emergencies, take any such source l k

out of service without prior approval of the Edison  !

dispatcher.

A-10  : I 8l l

APPENDIX 7

,.s . . . . , . . . . _ _ . . . . . , _ _ _ . . . . ....c.., ...Z ._..

-f -- cr.e 2:in: er scheculine limica:icn: er an" e f

<=-~'c c@ ~:=c o f r m ,*: - *' ~~ ghail uge dnn 5i =ece

.c res:c:a . . . . Lv ..u...... a: ..c c:-.... .: . . . . . .

in :he even: cf cc:c o c. . . . _ _ . . Ocuse c 1 cr e ,..c2 such scurces c becc=e :enperari'y unavailable. .

4.6 As long as the City is purchasing a portion of its load requirements from Edison, in the event that the lack of availability of generating sources or transmission capacity results in insufficient capacity to provide adequate service to the combined loads of Edison's and City's systems, and load curtailment or limitations on new loads becomes necessary on the combined system, the City and Edison agree to engage jointly in load curtailment on a pro rata basis and/or in ILnitations on new loads. No curtailment or limita-tion will be initiated until all reasonable efforts have been made by each party to make full use of all California and adjacent regional resources.

4.7 Each party shall operate its system, in accordance with good electric utility practice, to minimize the reactive pcwer de=and placed on the other party's system.

4.8 In the event that Edison, at its sole option, schedules energy from City's Rated Capability during any hour, which energy exceeds the City's requirements during that hour, Edison shall pay City for such excess energy at a rate per kilowa :-hour equal to City's incremental cost plus 15 percent of such cost. ii

APPENDIX 7

. ... . __.... ..e........... 7.... .. ..... ...... . ,

da:e-of fir. coera:ica :f :ne coera:::n of such scurce .

is c reed :: h, Edisca. Edi3:n . _ '.ca. for suc..

n::,, :: : :n:. ... .

~

. : . .. : .. ' . L ...:.:n::~. :::..

N: ::;;;i:  :: Inarg; ::...: . . '. . . . : . ~. : .: s d nds:

any applicable par:ia'. require:ca:5 ra:e until a source of power is firm. Edison will cooperate, when condi.

tions on its system permit, by providing a load for wcrranty testing of all new City units.

4.10- Edison shall provide scheduling and dispatching ,

services for City's sources of power. City shall reimburse Edison monthly for such services at a mutually agreeable rate based on Edison's costs, including overheads, of providing such services.

4.11 In the event City acquires a non-firm source of energy, City will be credited for such energy to the extent that such energy is used to meet that portion of its requirements which is not being =et by City's other sources of power. Edison shall purchase from City all such energy which is excess to City's require- 1 i

ments at City's cost which cost shall include charges made by Edison and others to City for transmission service, plus 15 percent of such ecst provided, that 1 such energy is economically usable by Edison. Edison shall provide and City shall be obligated to pay for spinning reserves to back up such non-firm source at a charge equal to the incre=enta*. c:st incurred by

~

Edison in providing such reserce:. .

i A-12

. ~ . . _ _ _ _ - . -

APPENDIX 7 r

in tne event Ltty acquires a non-:tr= s:urce a:

g-,--.. v ;--- .u.8, .e, 3-. u n-- , : :---- -- --- 32.,

'tran:mi::irr : r- i : :":r ::::::fr- f r :i" i:' -- - 1 :-

owned oy Eolson :or ar suer n:n-i.rr 5: 2r:= --

energy. If City cesires ::ansmission of suc.. ncn-firm

. pcwer.over facilities cutside Edison's certifi:sted service area where such facilities are interconnected with but not solely owned by Edison, City shall be responsible for negotiations with the appropriate owner or owners of such facilities for such transmission.

Edison shall cooperate with City in its efforts to obtain such transmission of power. It is contemplaced that the period of time involved may be more or less chan 12 months and that the charges for transmission service will be calculated on a basis proportional to charges applicable to Network or Point-to-Point Transmission Service. If the period involved is not a multiple of 12 months, a special agreement will be required which may embody changes in the terms and conditions of Network or Point-to-Point Transmission Service to reflect conditions occasioned by the different period of time involved.

4.12 Either party may, from time to time, recuire a demonstration of the ability of a City's generating source to produce the Rated Capability of that source.

Such demonstration shall be similar to that set forth in Section 3.3 hereof. Such de=enstration shall be perfor=ed at the requesting party's sole er. pense.

I

.e I

.,a; 4

-,_. _. .-,...m., -

,..m..,... ,,,y ._. _ . . . - ., . , . . _

APPENDZX 7

.. ............cc_;... T .;__.__.

.1 The cesign anc construction :: C::y-cwne :as:__-

ties a any poin: ci in:er:::nse:isn ':e:::can :..2 sy : ems of Edis:n :nf i:: :. l '. - - ' _' : : :- ::--

wri: ten approval Of Edis:- _:n; as Ci:; has made such design and performed such construction in accordance with Edison's standards, Edison shall not withhold such approval.

5.2 City shall have the right to construct trans-mission facilities, or arrange with others for trans-mission service, and such facilities or the facilities providing such service, may be connected to Edison's system when (a) ac :quate electrical system protection is provided; (b) che City reimburses Edison for costs incurred by it as a result of such connection; and (c) the City arranges for transmission service to be provided by Edison in accordance with the terms and conditions of Edison's rates for such service. Such facilities or arrangements may be constructed or pro-vided jointly with other utilities, provided that such utilities have entered into either an agreement for interconnected operations or an Integrated Operations Agreement with Edison. Edison will agree to enter into arrangements with such other utilities substantially in accord with its existing interconnection agreements or principles set forth herein for Integrated Operations.

A-la .

APPENDIX 7

6. Supolemen:a1 Service and Losses

.. Jd sen si.;11 pr vide

- he Oc;;ncs :f Ci y's

=.ectric sys:er requirements in:~_udin; ::-1::::.: :

p?"er and energy for unavailable 7. :c' C:7abili y under rates, cer=s, conditions, and f:r: Of cen:ract to be agreed upon by the parties or determined by final order of the Federal Power Cecmission.

6.2 Prior to determining the City's capacity and

~

energy credits,the Rated Capability of each of the City's sources of generation and its associated energy shall be reduced to reflect appropriate average transmission losses from that source to the point of interconnection between Edison's and City's Systems.

6.3 Capacity credit under any applicable partial requirements rate for a City's source of generation shall be given when such source is integrated into the combined systems as provided in Section 2.0 hereof, but not prior to the date of firm operation.

6.4 In the event of a forced outage of a City resource, Edison shall use its best efforts to provide transmission service ever existing facilities solely owned by Edison for any appropriate resource City may obtain to replace the resource forced out.

If City desires transmission of power from such A-15 .

i

APPENDlX 7

........ . . :. .~.....: :u::ii: :ll:-'---~~----'

sa;cice crea unere such facili:ies are in:ercennec:ec

...c. su: r.;; 30.c_y cwned by Edison, Ci:y sn '. be -

..: ;n:i': 1: f:: .:;::it:icns ci:'- : .r : :- rr ri::<

-- .:r :r ryn:r; :f such facilities for such transmissier.

Edison shall c::pera:e with City in its efferts c:

obtain such transmission of power. It is contemplated that the period of time involved may be more or less than 12 months and that the charges for transmission service will be calculated on a basis proportional to charges applicable to Network or Point-to-Point Transmission Service. If the period involved is not a multiple of 12 months a special agreement will be required which may embody changes in the terms and conditions of Network or Point-to-Point Transmission Service to reflect conditions occasioned by the different period of time involved.

7. Sale of Surplus Power 7.1 In the event City ccustructs or acquires a source of power which Edison and City have agreed will be integrated with the power sources available to the combined systems, and a portion of such scurce will exceed the L= mediately foreseeable requirements of the City, Edison will purchase such portion subject to the following:

7.1.1 City shall first use such source of power to meet its own esti=ated requirements.

i A-16

APPENDZX 7

.'.~.

. _ : :. . .. . . . a. :

,_.sn Ed . s:n 2: .eas: inu vears' advance notice of the amount of such un_e:s sacr:er nc::ce is etherwise agreed up:n.

7. lc2 Ti y ani : fir: crc- agreed that City wi'_'. have a need for such pcrtion for its own-requirements in the reasonably foreseeable future; 7.1.4 The capacity associated with such portion is available for a minimum of 12 consecutive months; 7.1.5 Energy associated with such capacity bears the same ratio to the total energy availability as the ratio'of capacity to be purchased bears to the total capacity of the source; and 7.1.6 The price for capacity and energy to be purchased by Edison shall fully ec=pensate City for investment and all other associated Costs.

7.1.7 For purposes of determining Rated Capability, it shall be deemed that the Rated Capability of such source is equal to its total capability minus the amount of capacity being sold to Edison.

F 7.2 In the event City desires to sell outside the combined systems all or a part of the output of any l A-17 ,

s ,

l

_ _ . . _ . . _ _ _ _~_ . _ . . _ . . _ . - - _ . . _

APPENDZX 7

. - ... ___ ... __ 7. ._,  :; ., ..__1 '

fir : Off:r :-

sell suen ou:put to Edisen a: a price which shall ful'c c moensa:e Ci:v for inves::en; and all :her ass::i_:_. ...:_.  ::. :;.. . -. :.: :fis:- d:es n:: :: ::. a

purch::: : _:h :::;.:, i:; - :; sell it ou: side :he c:mbined sys: ems during peri,ods when it is anticipated such output will not be required to serve the combined loads of Edison and the City. Where applicable, Edison agrees to provide transmission service for the period of the sale in accordance with the terms and conditions of the Integrated Operations Agreement.

7.3 In the event Edison refuses to integrate the City's proposed source of power into the combined systems as City proposes, City may proceed with its construction or acquisition. In such event, City shall not receive a capacity credit under any applicable partial requirements rate until such. integration is agreed upon between the parties. The City shall be free to sell all or part of the output outside the combined systems and where applicable Edison agrees .

to provide transmission service for the period of

- the sale in accordance with the terms and conditions of the Integrated Operations Ar,reement.

8. Transmission Line Design Racings 8.1 Charges for Network Transmission Service and Point-to-Point Transmission Service are based on the A-18 .

i

- . ~ .

y -+ -

p, w -s -+me.-m.-g,

.-9 3 -,-,*--te,a - yeoame-y* eys-+= -

= e-,e-4.-- e--,e- .-y-------c-e ,w-ow.4 +ow+se-maw

APPENDIX 7

2. . . . ..

of determining such charges , 5 :n ;e3__n ratin_3 5..a .1 be deemed to be as fol'..cws:

8.1.1 For a"~_ 220 k" :::nsmi. .:c 'in:. . . . '. _ _ . d _

fer Network Transmissitn service , and c'-er=

such lines are listed in Schedule 18A of cne Federal Power Commission Annual Power Syste=

Statement Form 12, 57 percent of those capacity ratings set forth in said Schedule; 8.1.2 -For a transmission line operating at 220 kV or less, where such line is not utilized for Network Transmission Service but where such line is listed in Schedule 18A of the Federal Power Commission Annual Power System Statement ,

Form 12, 57 percent of its capacity rating as set forth in said Schedule.

8.1.3 For a transmission line operating at 220 kV or less and where such line is not listed in Schedule 18A of the Federal Power Commission Annual Power System Statement Form 12, 57 per-cent of Edison's estimate of the capacity rating that would be set forth in said Schedule if such line were listed.

8.1.4 Capacity ratings of transmission lines operating at 220 kV or less, as such ratings A-19 6

APPENDEX 7 are ce: :nr:n in a . c. . tene:u.e _:.., r . n::

be less thcn the : :::n: ::rr, i : ::---d-~ -

ha: line s overnet: . : r. _ _ : . : . - - . . . , _.

60 Hert: cen:inuous a'_:arna-in; curren:, .r_1 raise the condue:cr ::.; art:ure frcr In ar. bien; air :empera:ure of 400 cen:igrade :o a condue:c:

temperature of 900 centigrade wi:h a cross wind of two feet per second; 8.1.5 Except for Edison's 500 kV line constructed between Eldorado Substation and the Colorado River (which presently has a design racing of 768 megawatts), a transmission line operating at 500 kV shall be deemed to have a design rating of 1,000 MW, unless a different design rating'is established frem stability studies, which studies give weight to generator and transmission line impedances, transients, series compensation, and parallel circuits, as well as conductor material and size. In the event the design rating of a 500 kV line is changed as a result of changes in series compensation or other factors, charges for transmission service will be modified accordingly.

8.1.6 For the 800 kV DC transmission line between Celilo and Sylmar Converter Stations, the design rating, with all equipment in service, shall be A-20 i

._ - ~ ~ . - . - . _ . _ , . - . .

APPENDZX 7

'...'^^

. . . . . . . . . iu . . . . . . . . . . .  ;-'----

ne Oregon-Nevada borcer, of wnica s:isen 5 en:i:lement is 21.5 percen: Of su:'n ::-in;.

per-

...  : :ner party =ay reques: s rr. :

.- ..a

ent figure, or the basis of de:ernining capacity ratings set forth'above, not more than once in any five-year period. If such a review indicates that such figure should be increased or decreased by more than one percentage point, or if such basis should be changed, an increase or decrease in charges, as appropriate, shall be made and reflected in the next scheduled rate filing. City may, on request, review studies made by Edison which are used to determine the design rating for the 500 kV transmission line in question.

9. Notices 9.1 Any written notice, if to be given to the City, shall be addressed to and if to Edison, to Secretary, Southern California Edison Company, P. O. Box 800, Rose =ead, California 91770.

l A-21 E

1 APPEND!X 7 1

l

:t. :: :ne ecen: cd ary cisa;reemen: between -.

r

ia: :i:: r..:..:: :: (i) any :.aes:i:n :f ft:t rr )

1 epini:n inv:1 red ir the application of the provisions  ;

cf that agreement, or (ii) the interpretation of any provision of that agreement, the disagreement will be submitted to arbitration, unless such matter is within a regulatory agency's jurisdiction.

11. No Dedication of Facilities 11.1 Any undertaking by one party to another party under the Integrated Operation Agreement shall not constitute the dedication of the electrical system or any portion thereof of any party to the public cr to the other party, and it is agreed that any such undertaking shall cease upon the termination of that agreement.

12. Regulatorv Authority 12.1 The Integrated Operation Agreement shall be subject to filing with, and to such changes or modifications as may from time to ti=e be directed by appropriate regulatory authority, if any, in the exercise of its jurisdiction.

A-22 i

, _ _ , _ , _ _ _ . - . _ _ ._. E' _ , . _. . _-

_~ . _

a 1

APPEND 1X 7

. L'ncontrollacle 7:rces

.;." . ; r ; f 5 t.e . . _; :: i;;3 rec :: be in cefE_~.: )

ir :: e -: rf:rr:nce :f I-- cf i:s ch'.i;ations under the In:egrs:*: Opera:icn Agreement'or any rela:ed i Transmission Service Agreement (other than. obligations of said party.to pay costs and' expenses) when a

- failure of performance shall.be due to uncontrollable -

forces. The - term " uncontrollable forces" shall be -

any cause beyond the control of the party affected, including but not restricted to failure of or threat of failure of facilities, flood, earthquake, storm, fire, lightning, epidemic, war,. riot, civil disturbance or disobedience, labor dispute, labor or material

-?

shortage, sabotage, restraint by court order or public authority, and action or non-action by or i failure to obtain the necessary authorizations or' i approvals from any governmental agency or authority, which by exercise of due diligence it shall be unable to overcome. Nothing contained herein shall be construed so as to require a party to settle any i i

strike or labor dispute in which it may be involved.

Any party rendered unable to fulfill any of its obligations under the Integrated Operation Agreement  !

by reason of uncontrollable forces shall exercise due diligence to remove such inability with all reasonable dispatch.

?

A-23  :)

APPENDlX 7 1 . *1'I*I7' I;;;?p; f77 --" >*ee de-e-s

-,:-- "OSE, Charge

/ e:

vuus . ;, , , , - un: u, - u , ,. Thomas E. Kuyper, Esq. Assistant Attorney General Antitrust Division . Department of Justice Washington, D. C. 20530

• Re: Southern California Edison Company, San Onofre Nuclear Generation Station, Nuclear Units #2 and #3, .

AEC Dockets 50-361A and 50-362A

Dear Mr. Kuyper:

On July 12, 1971, the Department of Justice Antitrust Division completed its review in connection with the above genersting' station and recommended to the Atomic

-Energy Commission that an antitrust hearing be held pursuant 1954, as amended. to Section loS(c) of the Atomic Enercy Act of Southern California Edison Co pany

(" Edison") denied then and continues to deny every allegation thEt Edison has violated any of the antitrust laws of the United f tates or that any activities under the proposed license would create or maintain a situation s inconsistent with those laws.

Edison has entered into agreements with all of its large resale customers which provide, amonc other things, for integrated operations and coordinated planning of customer ments resources with Edison resources , partial require-service, transmission service, and participation by units. such customers in certain futuro Edison generating N Edison is agreeable to the imposition of conditions to thethe of Sanlicence, Onofre licence which .1111 er. body, for the period

.. previ."icns Cen*? rally in accord with such .

....uGrect cnts with it.s larde resalc cus_t.ome,;.;_._,_ Edison ,ggy.ee3,, ,

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APPENODC 8 1

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.= c c2 2 therefore, that conditiens in the ferm attached nn. be made part of the license fcr the above units on the following express understandings with the Departmen; of Justice:

a. Nothing in these conditions shall be decced to enlarge or modify the extent to which Edison has heretofore dedicated any of its properties to public service.'

b. Edison does not intend to become a common c'arrier

. by reason of these conditions'.

c. These commitments by Edison are made in order to render unnecessary an antitrust hearing with respect to the pending applications for these units. The Department of Justice will recommend to the Atcmic Energy Commission that there be no antitrust hearing in this matter as a hearing is no lenger needed.

d. These commitr.ents do not constitute an admission of any of the allegations contained in the Department of Justice letter of July 12, 1971, to the Atomic Energy Co.mmission.

e. Edison reserves the right to contend in any other proceedings before the Atomic Eners:

.. s Commissicn and with respect to any attempt in this proceeding to modify these conditions should they be imposed by the Atomic Energy Commission as license conditions, that the Atomic Energy Commissien does not have jurisdiction to impose such conditions.

The undersigned is authorized by Edison to act on its behalf and to submit the foregoing to the Department of Justice and the Atomic Energy Commission.

Very truly yours, i

%u.

m  % .x

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i iom=** --

• APPEND 8X 8 _

1 l

l SOUTHER: CAI.IFOR::: A ~ EDISC:: CCi4P AI:Y.

CONDIT!O::5 TO 3/,:t 0:: FF.*:.

' :JCLEAE U:::TS f 2 A :D 63 AI' L7 'l~1 0E -

nZC EOCKETS NOS. 50-361A A:D 50 :62A T

1. As used herein:

1.1 " Bulk. Power" means the electric power, and any t attendant energy, supplied or made available at  ;

transmission or subtransmission voltage by one

' e,ntity to another, 1.2 " Entity" means, person, a private or public corporation, a municipality,.a cooperativc, an' association, a joint stock association or business  ;

trust owning, operating or propocing in good

. faith to own or operate equipment or facilities for the generation, transmission or distribut' ion of electricity to or for the public as' a utility. .

2. Applicant . recognizes it ' is generally in the public  !

, interest for electric utilities to interconnect, coor-dinate reserves, and/or engage in bulk power supply transactions in order to provide mutual, -though not

• necessarily equal benefits, to each of the parties in  ;

such arrangements. However, Applicant should not be obif gated to enter into such a,n arrangement if (1) to f do so would v.iolate, or incapacitate it from performing any lawfully existing contracts it has with another .

party or (2) there is contemporaneous 1y ava11cb3e to it a mutually exclusive competing or alternative '

' arrangement with another. party which affords it greater benefits. In implementing the commitments in the succeeding paragraphs, Applicant will act in accordance with these principles.

3. Applicant shall, pursuant to such principles, permit participation on mutually agreeable terms in new nuclear generating units initiated by Applicant, upon timely s  :

e, 6s APPENDEX 8-

.-: z - -  ; :: . entity (ie:) uithin or contiGurus

1 11. ;.. ' '

:

. . . _ .  ; area which at that tine coe not h3 9 tc;;rs to f n titern:tive co ;2r;t;y-pr;;;c s;,c;;

P - Ouer cupply. ' lith roepect to th::e uni:s n:

initiated by Applicant in which Applicant i: a join:

participant witn other utilities, Applicant shall ce:perate in facilitatir,5 the participation of any rich entity (ies) which seeks such participation upon timely application.

4. Applicant'shall permit interconnection and coordination of reserves by meanc of agreements for the sale and purchape of emer cncy bulk power with any entity (ies) within or conLi6uous to Applicant's service area and thereby allow such other entity (ies), as well as-Applicant, full access on a proportionate basis' to the benefits of reserve coordination. (" Proportionate basis" refers to the equalized percentage of reserves concept rather than the largest single-unit concept, unless the participants have otherwise agreed. ) Interconnections will not be limited to low voltages when higher voltages are available from Applicant's installed facilities in the-area where interconnection is desired, when the proposed arrangement is found to be functionally, technically and economically feasibic. Emergency service to be provided under such agreements will be furnished to the fullest extent avail-able and desired where such supply does not jeopardize 4

or impair ' service to the supplier's customers.

5 Applicant shall sell bulk powe'r to or purchase bulk power from any other entity (ies) within or contiguous to Applicant's service area. This refers to the mutually

., beneficial opportunity to coordinate in the planning of a/ With respect to Applicant 's present or future resale l customers " timely application" shall be in no event later than 90 days after publication by the Atomic Energy Commission of the notice of the receipt of application .fer

' a construction permit. With respect to all other entity (ies) referred to above " timely application" shall be within a reasonable period from a planning standpoint after the  :

first public announcement of Applicant's intention to construct the specific unit, but in no event later than the said time specified for Applicant 's resale customers J l

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:: cr sell bulk power if such purchase er sale cann:t be found to be functionally, technically and ecenemically feacible.

6. Applicant shall, pursuaht to such principles, transmit bulk power over its transmission facilities within its

' ~

service arca, both between or among two or more entities with which it is interconnected to-the extent that such transmission can b'e found to be functionally, technically and economically feasible and c' an be e-frected without an adverse affect on service t.o its own customers..

Applicant is obligated under this condition to transmit bulk power on the terms stated above, and in connection with Applicant's plan to construct 'new transmission facilities for its own use within its service area, to include 'in its planning and construction program sufficient transmission capacity as required for such transmission, provided thtt such entity (ies) give Applicant sufficient adyn':e notice as may be required-to accommodate the arran3ement from a functional and technical standpoint and that such entity (ies) are obligated to compensate Applicant fully for.the use of its system.

Applicant shall use its best efforts to facilitate the transmission' of bulk power over then existing transmission facilities outside its service area for such entities.

7.' The. foregoing conditions shall be implemented in a manner consistent wi'th the provisions of the Federal Power Act i and all rates, charges or practices ~in connection therewith are to be subject to the approval of regulatory agencies

-l having j urisdiction over them.

W 4

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_ APPENDIX-9 SI'tlu1.J. W .\!i l #1.sicii n 2600 VIRGINIA AVENut:,. N W W ASHLf4GTCN, L 0, i l 0,l.7

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_ . . . aou October 25, I978 Twou.,e 6 4'*CE S 8 FR f NCIS J A Mf !E C Ant 8" . 0CK

'* L s y Ok a nie3N 0960 N pcwvGM sm John H. Shenefield Assistant Attorney General Antitrust Division United States Department of Justice Washington, D.C. 20530 Re: Arizona Public Service Company et al. Palo Verde Nuclear Generation Station Units 4 and 5; NRC Project Number P-662A, Department of Justice File Number 60 415-95 pa --

Dear Mr. Shenefield:

This is with reference to your letter of September 13, 1978 to Howard K. Shapar, advising the Nuclear Regulatory Commission

• 1 that in your opinion it is not necessary for the Commission to hold an antitrust hearing in the Palo Verde proceeding. The Cities of Anaheim and Ri'rerside, California do not seek an anti-trust review in relation to the construction permit for Palo Verde I

units 4 and 5. They (and other utilities) are participants in those units and want to avoid any delay in the issuance of a con- l struction permit for the units. ,..- l However, the Cities take issue with the factual assumptions in your letter. Contrary to the implications of your letter, it is the Cities' experience that the San Onofre conditions have neither resolved nor prevented situations inconsistent with tha antitrust laws. In Cities' view, Southern California Edison l Company has not lived up to the San Onofre conditions, or if tha conditions be narrowly construed, Edison has in any event acted l anticompetitively. The Cities therefore recommend that the )

Department of Justice consider taking action, outside the Palo l Verde proceeding, to enforco the San Onofre conditions and Ctne antitrust laws against Edison. ,-

7 The Cities recommend action outside t'le(PYlo Verde'proce4 ding

. r: . 3./-T ri:WT partly because many other electric systems a r'ge involved in,th(

N OCT 27 - d: I

. y, I u c. D.

I  :

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APPEN0!X 9 i

--2_

.Tney_ and'-their . electric custoasrs may b2 0$ver:cly. :i project.

~~o' '

r---'-"-tien of the project is delayad hv an antitrust i review.

Among other. obligations, the San onofre conditions obligate .

Edison to "transm i t bulk power over its transmission facilities t

within its'servicefarea" and "use-its best efforts to facilitate

. the transmission-of bulk power over then existing transmission facilities.outside its service area. . ." .Nevertheless, Edison has for example refused Anaheim and Riverside's requests for firm transmission: service from the Northwest, thereby foreclosing the Cities 1from : competing for. supplies -of bulk ~ power from ' sellers in "

the Northwest.and from purchasing energy sold by the Bonneville-Power Administration to which the Cities have statutory pre-ference.. (The f acts as Cities' understand them- will be presented in testimony on behalf of the Cities, to be served October 27,

- 1978 in ' Federal Energy, Regulatory Commission Docket No. E-7777 (Phase II). We shall -send you a copy: then. )

Briefly summarized, these are the facts as we understandand them: - Bulk power.- transactions between the Pacific Northwest California occur over the Pacific Northwest-Pacific Southwest Intertie. The principal f acilities of the Intertie below. the Oregon border'are two 500 KV AC lines controlled under forty year contracts by Edison and the two other members of the California

-Power Pools. and an 800 KV DC line in' which Edison is entitled to half the capacity .under a seventy-five year contract -(with the Los '

Angeles' Department of Water and Power and three smaller entities entitled to the other half) . Together, Edison, Pacific Gas &

Electric ' Company and San Diego Gas &~ Electric Company now control Ed ison ,

about 2,800'MW of the total.3,900 MW in the Intertie.

PG&E and SDG&E share their portion of the Intertie 43%, 50%, and 7%. (They also share imports from the Northwest on the same per-

• centage basis.)

~

Furthermore, Edison has the right of first refu-sal for any capacity in the DC line that is surplus to the needs of Los Angeles. and the others (and they must give Edison substan-tial' notice before attempting to sell capacity rights in the DC line). Moreover, the~ California Power Pool members claim that transmission rights-purchased by other entities such as the Sacramento Municipal Utility District and the California Depart-

. -ment of Water Resources revert to the Pool members whenThe not Pool used by the other entities and cannot be resold to others.

members have refused -to recognize DWR's interim sale of part.of its

- Intertie capacity to' the Cities.

In Cities' view, Edison's combining to control the Intertie has helped Edison to ' divide sales markets, to foreclose the Cities from supply markets,. and to, impose and maintain a price squeeze on '

the Cities. For example, Edison, PG&E, and SDG&E use the Intertie to export power ' to Northwest entities; Edison, PG&E and SDG&E appear to divide such sales to Northwest entities 43t'from Edisen,

50% from PG&E and 7% from SDG&E. ~ The California Power Pool mem-l s\

l

' APPENDIX 9 As Citie:

cars li%ewise divice tne u.arketuichin California.

' '---'c buyer in Ediron's

- th

.c r e prciers to buy frer FOLC, the buycr mus. get Edison's per-r;ssion to do so; and Fe s ;n . 3 : proclav untra recerves for the

1: '1 0 '. spinning reserves, chich uould be charged to the ca s t), which tends to h; such arrangements uneconomic.

Finally, with the Cities constrained to dependence on Edison, Edison has been able to impose a price squeeze on the Cities, charging them more than it charges retail customers for comparable services, for a long period until the Federal Energy Regulatory

. Commission. reduces the wholesale rates. The Cities areThey trying to have escape their dependence on Edison, but it takes time.

succeeded in purchasing some energy from Nevada Power Company in an interim arrangement also beneficial to Edison. The Cities are pursuing participation in projects such as San onofre and Palo Ve'rde (but contrary to the fif th San Onofre condition, relating in part to coordinated planning of transmission, Edison has thus far refused to let Cities participate in the high voltage lines from Palo Verde to California, offering only to sell transmission ser-vices to the Cities). As stated, Cities are seeking power sup-However, Edison has plies in the Northwest (and the Southwest).

used its control over the Intertie in a manner that forecloses Cities from soon diversifying its power sources so as to escape present dependence on Edison. As a consequence, Cities are vulnerable to Edison's price squeeze and could be driven out of business, with Edison taking over Cities' retail service areas.

The Cities are in earnest about their antitrust allegations against Edison. On March 2, 1978 Anaheim, Riverside, and others filed an antitrust suit against Ed i son . Anaheim, Riverside, Ban-nine, Colton, and Azusa, Cslifornia v. Soutnern California Edison Company, U.S. District Court, Central District of California, CV-78-810-MML. On August 31, 1978, the Court denied Edison's motion to dismiss the suit, but def erred- the action pending three FERC proceedings. In two of the FERC proceedings, Anaheim, Riverside and others are raising the issues of the Intertie, the California Power Pool agreement, the Seven Party Agreement (between the California Power Pool members and four investor-owned utilities in the Northwest), and related agreements and transactions: FERC

. Docket Nos. E-7777 (Phase II) and E-7796. Finally, the Cities have pursued the price squeeze issue in an Edison wholesale rate case, FERC Docket No. , ER76-205.

Enforcement of the San Onofre conditions would help ame-1: orate the antitrust harm now being suf fered by Anaheim, River-side, and others. Enforcement would open the way for the Cities to reach economical sources of electricity, thus vindicating the Cities' rights to preference power from federal sources, their rights to compete with others for less expensive electricity from whatever source, and their right to escape from the price squeeze imposed by Edison. While the D?partment of Justice must often s

APPEND 8X 9 Jaavd it to the partia= to seek a vindication of their rights unier the antitrust la.ws, the San Onofre cor.d::icr.s resulted it-

.... .............a. - . . . . . .  :..'...... . .. .

f el ! c cing the Depa r t., ?n t 's ear. lier rec 0.cn.eni: .i n for cn c n t :. . : .' : .

hc :.r i r.; by t's a URC, and the 5:n Onofre con ::: ens hace lec ..:

De pa r t.:,a n t ce sugger.. i.e fur *.her antitrt.. .....ni in :..a P:.1 Verde proceeding. Ir. cur tieu, th e De pc r :.c.c r. : c7 Ju:ticc ch;; ;

therefore sesh snfer:........ Of the San Cr.:frc un;iti:n: (in c manner that doec not c...c; ten delay of the .'11: *lcrde construction permit or the San Onofre operating license because a delay would hurt Anaheim, Riverside, and possibly others);.or, the Department should otherwise seek enforcement of the antitrust laws against '

Ed i so n'.

Sincerely, Alan J. Both Attorney for the Cities of Anaheim and Riverside, California cc: Gordon W. Hoyt Utilities Director Everett C. Ross Public Utilities Director I.

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'i'ais letter is to forn:11y c nfir:r. the City c' G1=l:~.c's  :.  :

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Wrvico Capart 1:nt, indicates t'.ct Ito lias discus:ca el rcqu:sted p.,rticipr.tica by the City of Glendale with ycur Mr. E1111.: Ceuil, ccutiva a,

g war su;Vico pty), upon Presid:at, occes.cn cur:.n;;

and tnewith.

pc.st severs; Davidyx.rs. .

J. Fogarty, , Vic: l'rcsid=t Tac Ci.ty of.Glendaic requests ycur cc.s.iccration of c. rigat for.

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aau o.:ncrs.up or d...is.

p.rtic,pation v.. .

t.. i i ts . Car first proforance on o ncrship ::: 1d Isc en a cc:rprd'0 irir1. witit tac Pacific .Intert.ie o..ncrs. hip c.l allccatica..'.:rinciples.

.: nre prc;arca to crrnar.e rin=cing ror : .:.s port ca or car.ersnip cs suits the needs for construction.

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fir:n, preferably, or sunlus energy frc:t thess p1=ts en prefer-Jay lon; )

tCit: CCntracts or With tir.0 li"".it.tions.

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APPENDIX 11 c m . H z e- C. ' : . --i~ Educa Comcany ,

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Mr. J. Zeithley City Mannger ,

. City of Glendale . '

Glendale, California

Dear Mr. Keithley:

Thank you for your letter of May 16, 1975, in which you, on behalf of the City of Glendale, have requested to participate in San Onofre Nuclear Generating Station Units 2 and 3. As you know, these units are now under construction and are planned for coc=ercial operation in 1981 and 1932.

s Our plans for these units have received conti.uing

• public notice and discussion for several years. On June 1,

.1970 Edison and-San Diego Gas & Electric applied to the AEC for.a construction permit. After many delays, hearings and sub=ittals, such a permit was received on Cetober'18,.1973.

The capacity and energy of Edison's share of Units e 2 and 3 is need?d to serve Edison's retail and resale customers, e.nd to meet its other firm contractual ccanitments.

If the capacity and energy of any portion of these units were acquired by a utility syste located outsice Edison's service crea, Edison would be unable to replace that ecpacity and energy with conparable resourc e by theWetima of the units' believe yocr respective co=nercial operating dates.

request is not tinaly and, therefore, cannot he accomnciated from a planning standpoint. Accordingly, Ediscn is non prepared to offer you participation in the capacity and energy of San Gnofre Units 2 and 3.

• Te;hile soms inferr*>.1 discussions may have occurred between your Mr. W. E. Fell and Messrs. Willian R. Gould and  ;

David J. Fogarty during the past several years, I am sura it was made clear, for the reasons given above, that participa- >

tion in Units 2 and 3 was not available to the City of s

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not elect to acquira the persions of Edison's interest in  !

'- Units 2 and 3 which Edison has offered to m ka available to them, such portiens will, pursuant to that agreement's terms, revert back to Idison, and thereby will maintain the capacity and energy wi-JJ n tha area sarved by Edison and its resale customers.  ;

With respect to your request to purchase capacity and ' energy from Units 2 and,3, we do not anticipate any ,

surplus capacity or energy from these units. Therefore, we could not agree to such a sale at this tima, t With respect to pc. ticipation in Edison's future nuclear ceneratica units Ediscn e

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Kcclear R2gulatory Co-* ssion's license for San Onofre Units 2 and 3. A coc.y of these conditions is attached.

My staff wi*.1 he ha.py to mest with you to discuss t ue 4 .p a C a. .. .s oso s

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Co.. .. n.a .w..s .

e Yours very truly,

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APPENDIX 12 -

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Janua ry 17, 1977 , ,

Mr. acScrt L. Mycrt Manager of Resale Accounts Southern Cali fornia Edison Company Post Office Sex 800

, Rosemead, Cali fornia S1770

Dear Bob:

Subj ect: . Paio Verde to Devers 500 kv Transmission Line The City of Anaheim is discussing with the Salt River Project aquisition of a part of their interest in various generating projects in Arizona.

Among the projects bsing discussed is the Paio Verde Nuclear Project.

As you know, the sosteren California Edison Company proposes to construct a 500 kv transmiisich ' ne f rom Palo Verde to the Devers Substation.

Anaheim'has expresses an interest in acquiring an ownership interest in 100 megawatts of capacity in the Palo Verde Plant. Anaheim would like to acquire an ownership interest in the proposed Palo Verde-Oevers (or Paio Since the line has not yet Verde-Sundesert-Devers) transmission line.

received the necessary regulatory agency approvals, etc. , it appears that is the time to pian for joint ownership of the line. Udder what now terms and conditions will the Southern California Edison Company share ownership in the above-mentioned transmission line with the City of Anabelm.

,,eIy truly yours, V,

. 4 %.. %

Gorden V. HJy t Utliities Director cc: Alan R. Watts, Esq.

George Spiegel, Esq.

- Mr. Vins ton H. Peterson s

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< APPENDIX 13 1 l

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T Mr. Gordon '.1. !!cvt*

Utilities Dirceter

• City of Anaheim Post Office Dox 3222 Anahein, Californic 92803 7

Dear Gordon:

.9 This is in respense to your letter inceiry of . nuary 17,

c. 1977, concerning terrts and conditions for sharinc cwnershic in Edicon's Pale Verde to orvers 500 kV Transminsion Line for N the parpece of transmittinn pcuer frcrs che Talo Vcrde Muc1 car Project that ycn nay acquire from the .< alt River Project.

Edison has a particioation ownershim interest in Palo Verde !;ucicar Project Units 1, O a nd 3 o f 5;i 5 MU. In addition, 2 Edison has contractusi rights to participate in additionni generating units in Arizona which are planneri fer initial l operatica in the inte 1900's. Edison's participation ownership

_ interest in those planned units would be appro.v.imately 400 tr7.

The Palo Verde to Devers 500 k7 Transmission Line is required for tranccitting this 903 WT cf pcwcr to idison.

~

As you are auare, Edisen has expressed an interest to participate in the Second Northwest-Southwest DC ';'r ince.ission Line te the e:: tent of a 4 00 MU share. If this DC line is ter=incted at Ucstving Substatien near Phconix, Ari:ena , Edicen plans to use the Palo Verde to Devers 500 hv Trans11nsion Line for further trans:sission of OC transmission line ocwcr to Edison.

. You are also auare that Edison has n:n:can=4 on interrst in acquiring a pertion of Salt River troicer's interest in the Palo Verde Muclear Project. To thr ei.:en: that T'licen acm'iros this interest, the Pale Verde to Dever: 500 ku Transrissien 4

Line will be uced to tran :.it it to Edison.

Acenrdinaly, we are unable to of for vou lenq-ter= f i r--

tr:ns=iscion servi =c en the raio verin te .7cv..rc 5M hv rnns-

is cia n .ir.< . Fewever, u- .rc willin7 to liacuns s h ; r t - : # :--

fir: tr .ncni :nien n:rvi:n =rra wenen:n for vrn en :"iF lino- .

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APPENDlX 14 f ,,i

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Of:::- of Oiiit:*s 1:c'::

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kr. Acber. . Myers Manager of Resale Accounts'<

Southern California Edisen Ccar Ay

- Post Office Sox 800

' Rosemead', CA . 91770

Dear Bob:

I have reviewed your 2 er of March 16, 1977 wherein Edison states its inability ta offer long-term firm transmission L.

service, on Edison's proposed Palo Verde to Devers 500 kv cransmission line, to the City of Anaheim where such trans-mission-service is needed'to enable Anaheim to participate in ownership in the Palo Verde Nuclear Project of Arizona Public Service Ccmpany (NRC Docket No. 50-528A). Edison further refuses to consider co-ownership with Anaheim in this planned transmission line between Palo Verde Nuclear Project and Edison's Devers Substation.

' We are disappointed in your statement of an Edison position which appears contrary to the tenor and terms of our arrangements under which Anaheim power : and transmission resources and operations are integrated, the conditions to the San Onofre license (NRC Docket Nos. 50-316A, et all) and the conditions to the Palo Verde license (NRC Docket Nos. STN 50-528, et all). Among other things, these require Edisen to proceed en a joint planning basis so as to include in its planning and construction program sufficient transmission capacity as is required by Anaheim. Moreover, the withhciding of transmission capacity.from Anaheim could result in eliminating Anaheim's cc=petitive opportunity to obtain aNeedless portiento of say, the presently this raises unallocated Palo Verde capacity.

needless legal questions.

Edison's' policy here is unproductive. The Eureau of Land Management, and other regulatory agencies, as well as enviremental agencies, are bound'to insist that all parties interested in

ansmission from Palo Verde to bring power into Califcrnia combine their efforts so that the resulting facilities provide the service at lcwest overall cost and minimum cverall 4

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APPENDIX 14 With res:ect te yo :: sp'ocific rc~;urs t f0- c -c'..T.o r ship of ~ dison 's Pa ~ o Ver '.c to Devers 7:r.::st-is::.c.. ..ine , un iio

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. ROBERT L. MY'RS

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RLM:vs . .

~ ') cc: 'finston !!. Pct:crson c George Spio<yel .

Alan t?ntts N R. P. Durbank .

bec: E. A. Myers, Jr.

• A. Arenal David Barry O R. K. Durant .

., P. E. Martin .

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R. L. Mitchell < '.a.

c R. L. Whelchel M.-D. Wh Y te i

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